Áine Collins (Cork North West, Fine Gael) | Oireachtas source

I too welcome the opportunity to speak on this Bill. Risk equalisation has been a central plank of private health insurance from the outset. It is designed to take account of the differences in costs that arise due to the age or well-being of customers. That was relatively simple when the VHI was the only health insurance provider in the State, but with the introduction of other players into the market it has become more complicated. We need only recall the legal controversy that ensued when BUPA challenged the concept of risk equalisation in the courts. As a result of the actions of BUPA the current interim scheme was introduced, although it too was controversial. The Government’s commitment to the risk equalisation policy led to the withdrawal of BUPA from the Irish market. BUPA was then replaced by Quinn Insurance, which has now become Liberty Insurance.

The Bill will deliver on the Government’s commitment to strengthen the risk equalisation scheme. The principle involved is the provision of greater balance, which for the most part is fair. Most mainstream political parties agree with this principle but it is not true to say that healthier or younger people will pay more for their health insurance because of this new legislation. Equalisation has always been a central plank of Government policy regardless of the government in power. However, this is the first time health status has been included as a means of risk regulation in the insurance market. Until now the only factor considered was the age of the subscriber. Younger, healthier people may have to pay more for health insurance while they are young and healthy. It is inevitable that as they grow older or more infirm they will not be able to afford health insurance without equalisation measures. The idea is that equalisation benefits everybody in the long term.

The real controversy arose when other health insurers entered the market and were asked to make substantial financial contributions to the VHI. This is because the VHI has the majority of customers across all levels of well-being and, as a result, pays out by far the highest proportion of claims. People who joined the VHI many years ago are now using their services increasingly as they grow older. People are also living longer, and that inevitably contributes to increase demand for and utilisation of the health services.

It is important to ensure that there is genuine and fair competition among health insurers. The VHI should not be allowed to abuse the system or to use the system to cover up shortcomings in its operations. Administration costs should be similar across all insurance companies. The VHI has decided to increase its prices again from 22 November this year. This seems to be necessary to meet the requirements of the European Court of Justice on solvency, which are standard across the sector. The only way to reduce insurance costs, therefore, is to reduce hospital and care costs. There are many issues with regard to the way we deliver care services, judging from the past and present actions of the HSE and its inefficient handling of the recent change to home help services. It is highly unlikely that organisation is capable of doing anything more than squandering taxpayers' money at the expense of the most vulnerable in our society. Despite the fact that the HSE is overstaffed at an administrative level, all it was capable of doing was a desktop study of its customers' needs, which appears to bear no relation to the situation on the ground. Despite the fact that it has many administrators, the HSE seems unable to communicate with or even discuss cases with public representatives or people on the ground.

If the Minister and those of us in Fine Gael are to follow through with our election commitments to introduce universal health insurance at an affordable cost, we must begin by abolishing every bloc in the HSE. The organisation is unfit for purpose. Instead of promoting better health services, it is the main reason progress is not being made. We talk a great deal about how good we are at innovation in this country but I have yet to see any of that in the processes and the delivery of our health services.

This legislation for risk equalisation is an essential building block in moving towards universal health insurance, which is what the Government wants to deliver. We must now find ways in which we can deliver that. I commend the Bill to the House.

See this speech in context