Michael Lowry (Tipperary North, Independent) | Oireachtas source

I have grave concerns on the proposals contained in the Bill before the House today. The Health (Amendment) Bill seeks to give effect to the measures advanced in budget 2013 to charge private inpatients in public beds and to increase from €75 to €80 the acute public hospital inpatient charge. If advanced in its current form, the Bill will have a devastating impact on the private health insurance market and will further destabilise and jeopardise its viability.

This legislation will mean that patients with private health insurance will be charged on the double, with a claim being made on their health insurance policy for a service that they have already paid for through their taxes. We are locked in a vicious circle of rising health insurance costs as a direct result of the flawed approach taken by the Government. The average health insurance premium for a family of two adults and two children has doubled in the past three years. Policyholders have seen three separate increases over the past year and the Government's risk equalisation levy has added a significant burden to all adult policyholders.

Individuals and families alike are under immense pressure at the moment and are struggling to survive financially. Week-on-week, hundreds and thousands of individuals can no longer finance, and subsequently drop, their health insurance policies. In the past two years almost 200,000 individuals have been forced out of private health insurance, with a further 500,000 downgrading their policy.

Our community-rated system requires a large portion of young, healthy policyholders to offset the high costs incurred by older members. Over the past two years there has been a rapid decline in the number of people aged between 20 and 29 taking up a policy. The system is not sustainable if young people continue to leave in their droves. Health insurance providers and economists have indicated across the board that this Bill will lead to a drastic increase in premiums. Mr. Colm McCarthy, in a report commissioned by Aviva, has found that the proposed public bed re-designation will add 13% directly to premiums on a full-year basis and that, coupled with the haemorrhaging of young adult members, will mean premium increases in the region of 20% to 25%. It is expected that this legislation will directly result in the exodus of a further 300,000 individuals from the private health insurance market. In many cases those who have faithfully paid their policies for years will now be unable to finance them any longer and will be left with no choice but to give them up, without realising any benefit from their years of payment.

The Government must be cognisant that this exodus will in turn place further pressure on an already chaotic public health care system and will bring it to its knees. We are all aware of the state of our health care system and the huge backlog for public patients in securing appointments. For each insurance increase, more families will rely on public hospitals and the already overburdened system will flounder further. It is short-sighted in the extreme to introduce such policies, as ultimately the burden will fall on the State and subsequently the taxpayer. It is my belief that the Minister, Deputy Reilly, must take a step back and consider the impact that his policies are having on middle Ireland.

The programme for Government promises to advance free health care for all but the reality is that since this Government has come to power there has been no positive difference, rather, the cost of health insurance has risen steadily. The Bill is entirely contrary to the Government's stated aims. If the deterioration in private health insurance continues, the public system will decline further and fundamental health reform will become substantially more difficult and increasingly unlikely.

This legislation serves to drive health insurance out of the reach of the squeezed middle and into the realm of the well-off only. It seems the Government is knowingly ploughing ahead with policies that drive the cost of health insurance upwards rather than taking any steps to buck the trend with regard to the drastically rising costs. The Minister should address the cost issues in the health service directly rather than seek to make up the shortfall by placing an additional burden on the shoulders of struggling private patients.

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