Billy Kelleher (Cork North Central, Fianna Fail) | Oireachtas source

I thought at some stage the Minister might realise his policies are undermining the very proposals of universal health insurance he and the Minister for Finance espouse. It was an appalling attack on ordinary families who, day in day out, are doing their best to retain their private health insurance.

In October or November last year the Minister came to the Dáil with a Health Insurance (Amendment) Bill and we spoke about advanced care packages and non-advanced care packages. We on this side of the House were led to believe a sizeable number of the present plans would qualify as non-advanced care plans and would attract the lower stamp duty. However, when it came to publishing the list of advanced and non-advanced packages we found the average heath insurance policy was in the advanced plan section and therefore attracted the higher levy. A clear commitment was given in this House that this would not be the case and that many of the plans on the market would attract the lower stamp duty and levy but that has not happened. The ordinary plans families take out to protect themselves and pay for their own health care, lightening the burden on the State, were undermined by that U-turn on the number of plans that would be in the non-advanced plan attracting the lower levy and stamp duty. I cannot understand that.

There is another situation that goes back to the Health Insurance Authority's report last year. We all accept that there is confidential, market-sensitive and commercially sensitive information in this that must be redacted and there is no difficulty in that. The Minister could easily have published the report. It is probably in his desk and he has probably already read it. The report stated:

There is a conflict between the maintenance of the principal objective (community rating) and the sustainability of the health insurance market. The recommendation of the authority has taken account of these conflicting objectives along with the evaluation and analysis of returns, avoiding overcompensation and the maintenance of fair and open competition in the market.

The Health Insurance Authority has stated that any further increases are at variance and conflict with the principal objective of community rating. This is because increases drive out of the health insurance market those people who would cross-subsidise older people. This is not just Deputy Kelleher having a go at the Minister, although he well deserves that for what he said. This is the opinion of the Health Insurance Authority of Ireland. Although the authority advises the Minister continually he never takes its views and recommendations into account. This is a glaring example from the 2012 report. If the report states the same again, the Minister is acting contrary to the advice of an authority whose remit is to analyse the state of the private health insurance market and make recommendations and observations on it. The Minister comes here and states the reasons he is doing that but none of them stack up.

The other issue at the heart of this is VHI, which has an older cohort and a higher percentage of claims and will be the beneficiary of this. Is the primary motivation of this to address the impairment VHI will be in when it is regulated by the Central Bank as an insurance company? We all know VHI needs a huge capital ratio and reserve to be compliant and seek a licence from the central licensing body. The Minister could be honest and say he is doing this to ensure VHI will receive the largest amount of funding in transfers to benefit it for the purpose of off-loading it or minimising the amount of money the State will have to inject into it to bring it into compliance.

That would be fine. At least it would be honest. Clearly, this is what is at the back of many people's minds when the Minister proposes this increase in the risk equalisation levy, despite everything he said prior to 2011 when he was in opposition and vehemently opposed to these measures and stood up to protect hard-pressed families. All that has happened is that these hard-pressed families are being pressed and squeezed harder than ever. Let us get real on this issue. The measures the Minister proposes run contrary to everything we are trying to do in terms of risk equalisation.

The Minister mentioned universal health insurance and said he planned to move to the next phase and would publish the White Paper. We have been waiting almost three years for the White Paper. The Minister had proposals concerning the Dutch model, on which he had a fixation for some time. Those proposals have disappeared into thin air and we now are to have a White Paper which is to be published some time towards the end of the year. The difficulty I have with this is that in the meantime the Minister is pursuing policies that may undermine what the White Paper will try to achieve. I am sure he has set the terms of reference for the White Paper and provided for a recommendation to be brought back on how to implement a system of universal health insurance.

Regardless of what type of model will be recommended by the White Paper, we know that the basic principle of universal health insurance is that there must be a vibrant health insurance market. However, all of the policies the Minister for Health and the Minister for Finance have pursued in recent times have shattered the health insurance market which is contracting at an alarming rate. Only the other day we saw private health providers laying off employees. They are not laying off staff for the fun of it but because the private health insurance market is contracting and no longer profitable. If it is no longer profitable, we will see a further contraction and shrinking of the market, leading to less competition. Currently, there are four health insurers. The big insurer is VHI which came from a single State-sponsored private health insurance company to its current position where it holds approximately 50% of the market. This position cannot be sustained if huge numbers continue to leave the private health insurance market.

I accept that some insurance companies will cherry-pick their clients. The difficulty with a universal health insurance system is whether the Minister will be able to guarantee that there will be no cherry-picking of the cohort of people who will be targeted for health insurance. The Minister talks about having a nice suite of guaranteed services and cover - a set suite. However, if we look at the Dutch model of universal health insurance, it is in huge difficulty, with private health insurance companies dictating the coverage that will be available. The idea that the Minister will, somehow, with his vibrant health insurance market, be able to decide what cover will be available and the standards that will be laid down in terms of the insurers' obligation to provide cover is farcical, particularly when we have a situation where private health insurers find it exceptionally difficult to retain their premiums at an affordable rate and are unable to attract younger people into the health insurance market. This is completely at variance with stated policy.

As I have mentioned the issue of tax relief, I will move on to the charge for beds for private patients in public hospitals. What the Minister has done in one fell swoop is to incentivise public hospitals to prioritise private patients over public patients, as private patients will now be seen as a revenue stream. We are faced with a bizarre situation where the Minister is trying to promote a single tier health system, under which people will access health care based on need rather than ability to pay - a policy championed by him all the time - but at the same time he is bringing forward a policy that will force public hospitals to prioritise private patients because of the possibility of generating income as a result. This runs contrary to everything the Minister has said. This proposal and change of policy will undermine the move to a single tier health system under which everybody can access health care based on need as opposed to ability to pay.

We must realise that, by and large, the people who take out private health insurance are not part of the gold-plated circle to which the Minister for Finance, Deputy Michael Noonan, alluded. Perhaps the people concerned are at the Fine Gael €100 dinners, but the people I know who have taken out insurance are struggling daily. They are also taxpayers and entitled to enter the public health system. They have paid their taxes, made their contributions and are citizens of the State. Now they are being asked to pay on the double. They are also being asked to subsidise the public hospital system through the full cost charge for private patients in public beds. This is nothing more than another way to fill the black holes in the Minister of Health's budget year in year out.

We are in the bizarre situation where we are back looking at an Estimate that is simply comical in terms of whether it can be delivered. We know that in 2014 the Minister must take €666 million out of the health system. He says there could be churn or a turnover of up to €1 billion in cuts. Is it credible to suggest this can be done without a massive upheaval in health services? At a time when the Minister is proposing to do this, he is forcing more people out of the private system into the public system, which will further clog up hospitals and acute hospital settings. This must stop at some stage. This is being done by the party that supports community rating and the concept of intergenerational solidarity which it implemented and brought forward against virulent opposition from the Minister and others at the time. The Minister cannot deny that he was virulently opposed to it. He opposed it tooth and nail. I do not mind a small U-turn from time to time, but I do mind U-turns of this magnitude being made without explanation. The Minister should at least explain why he has now decided that community rating is a good idea and why it was a bad idea just a couple of years ago.

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