James Reilly (Dublin North, Fine Gael)

Ba mhaith liom fáilte a chur roimh gach éinne ar ais anseo inniu. I welcome everybody back after the Christmas break.

I am concerned that private health insurance is becoming harder to afford, especially for older people, as insurers increasingly tailor their insurance plans towards younger, healthier customers. I am strongly committed to protecting community rating, whereby older and sicker customers should pay the same amount for the same cover as younger and healthier people. To protect community rating, we need a system of risk equalisation which ensures that community rating can survive. We have an interim scheme in place since 2009. It is designed to compensate insurers which have older, less healthy customers and therefore higher claims costs, compared to insurers which have younger, less costly customers. The interim scheme is funded by a community rating levy in respect of every health insurance policy written. I extended the interim scheme for a further year in 2012 and will introduce a more detailed risk equalisation scheme under new legislation from next January.

To keep down the cost of health insurance for older people, I increased significantly the age-related income tax credit for insured persons aged 60 years and over, from 1 January 2012. The measures I took are designed to result in no overall increase of premiums in the market and to spread the risk more evenly between the healthy and the less healthy, the old and the young. I welcome the announcements by Aviva and the VHI that they do not envisage passing an increase on to customers' premiums on foot of revised rates of age-related tax credit and community rating levy for 2012.

In December 2011 I agreed with the three commercial health insurers to establish a health insurance consultative forum, to tackle issues of mutual concern. We agreed to work co-operatively in driving down costs related to health insurance and to identify savings that could be achieved by public and private hospitals. I indicated to the insurers that I would be happy to hear proposals from them which would result in lower costs for the health insurance sector. A new review of the VHI's claims costs will be carried out to establish what further savings can be made. The review is to be completed early this year and will contribute significantly to more effective cost control within the private health insurance market. I am determined that these and other measures will have a significant impact in containing the level of any future increases in health insurance premiums.

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