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

I welcome the opportunity to speak on this legislation. We have had numerous debates in recent years on health insurance. There have been lots of changes in recent years, including legislation, the establishment of the Health Insurance Authority, amending legislation on a regular basis, the establishment of the community lifetime rating and other welcome decisions. The entire health insurance industry went through a very difficult and turbulent time with the downturn of the economy since 2008. We saw drastic numbers of people falling out of the market and the market beginning to teeter on the brink of being unsustainable in terms of the vibrancy and competition in the market. Just as critical to the sustainability of the market was making sure that we had inter-generational solidarity and were able to encourage younger people back into the market. For a long time, there was a downward spiral that was very troubling. As a result of the lifetime community rating and the returning growth in the economy, it has stabilised and we now see the numbers increasing again.

There is an interesting phenomenon in voluntary health insurance in this country. Up to half the population takes out private health insurance cover. They take it out for a number of reasons. Many people take it out because of the fear of the public health system. Let us be under no illusions about that. While there may be other incentives, many people do not trust that if they get sick or require diagnostic services they could get them in a timely fashion through the public health system. It is something we have to acknowledge and try to address as best we can in terms of investing in our public health system. At the same time, we have to acknowledge that there is not a bottomless pit of money and that it has to be found through general taxation in some way.

In addition to taxing to fund the health system, there are other challenges in terms of competitiveness and retaining people in employment. Getting that balance right will be the critical challenge for this House, for Government and for society at large. In the context of the discussions of the Committee on the Future of Healthcare, chaired by Deputy Róisín Shortall, it will be a key challenge to provide a direction and pathway for the public health system in the years ahead and beyond the horizon. At the same time, we have to be honest about how we fund it and make sure it is sustainable into the future. That is a challenge.

Previous Governments announced that they would introduce universal health insurance. It took the ESRI and the Department of Health a number of years to work out how much it would cost. In the end, they were not able to do that effectively and the policy was subsequently abandoned.

What I find fascinating in the context of the debate about health insurance is that very often there is a perception that those who are the most affluent, at the very top, are the only ones who have private health cover. Ordinary working families take out health cover. Pensioners take out or retain private health cover. It is a large chunk of household income in any one year. The reasons for taking it out are myriad. One of the fundamental issues is that they do not trust or have confidence in the public hospital system. That issue has to be addressed. When they are taking it out, they are doing two things: they are protecting themselves and lightening the burden on the public hospital system. If every person who has private health cover had to attend diagnostic clinics or receive treatment through the public hospital system as it stands, it would collapse in terms of capacity and loss of revenue. It is something we have to be conscious of when we are trying to address the challenges in the public health system.

We will not be opposing the Bill. We have to acknowledge this is another hike in insurance premiums. It will cost people more. We have to be conscious that while there is growth in the economy and while there is an increase in the number of people taking out private health insurance, there is also a limit to the ability of people to afford the continual increases.

I want to make some observations on which I might get some clarity from the Minister at some stage. I do not expect it this evening but perhaps he will address them in the discussions on Committee Stage. A big problem with the levy is that it is a flat levy. It is totally socially regressive from a taxation perspective. That is something we should look at. Somebody who pays €700 for a plan has a levy of €440, which is the same as somebody who pays over €5,000. There is no other stamp duty in that context. The cheapest non-advanced plan, which costs €433, has an annual levy of €202, which means the levy is over 40% of the overall insurance premium. The most expensive non-advanced plan is approximately €1,300, which means the levy is effectively 15% of the overall premium.

Now, let us consider advanced plans. The cheapest advanced plan on the market is approximately €655. The associated levy is €403, accounting for 60% of the premium. The most expensive plan is €6,300. Effectively, this means the levy is approximately 6% of that premium. I am keen to hear some observations from the Minister on the matter at some stage. Stamp duty is a form of taxation and if we continue to have a flat rate, then we are penalising those who are only just able to afford private health insurance. Perhaps the Minister can examine the matter in the context of the Bill or of broader policy in the future.

In recent years, when the former Minister, Senator James Reilly, was in the House, we often debated the issue of private health insurance and the fact that premiums were continually increasing. The increase in private health insurance costs has resulted in the proliferation of health insurance policies, to the point where there are currently 354 policies on the market. Thankfully, the number has decreased from 380 or thereabouts. In any event, many people are simply incapable of processing all the information. It is difficult to sit down and assess which insurance premium policy right for individuals and their families. That matter must be addressed and HIA has a role in this regard. I have raised the matter at committee level and in the Dáil on numerous occasions. There should be streamlining of the number of policies available in the marketplace. The difficulty in assessing these policies can be overpowering for many people. Moreover, the policies are opaque and there are small-print conditions in many of the premia as well. There are certain basic requirements but sometimes companies can be imaginative or inflexible in terms of how they present their policies and packages. We should remain vigilant in this area to ensure transparency in how policies are advertised and sold.

Risk equalisation is a concept we support. Indeed, we initiated the idea. At one time Fine Gael opposed it some years ago. That is history, however, so we can leave it behind us. It is a decent concept for society, something that should be supported and encouraged to ensure that we continue to have a sustainable market. The debate is unfolding in other countries too. For example, a debate is under way in the United States with regard to Obamacare and how to potentially change some elements of that system. This could make it difficult for certain cohorts of people with illnesses and pre-existing conditions to access private health care.

Let us consider the marketplace here. VHI is the dominant player in the sense that it has approximately 50% of the overall market share. From a historical perspective, VHI was a monopoly. It carried a historical legacy into the modern market, where there is competition. There is a duty and an obligation on us to ensure this is managed properly because VHI has an older cohort of people. This means that it has a higher risk rating and risk equalisation is the way to address that.

There should be continued vigilance. The HIA must ensure that when it is assessing the marketplace sufficient due diligence is undertaken. Over a given period, we anticipate that the market, the make-up of the various players in the market and the profile of customers would change. This is why there should be continual assessment. Certainly, we have no wish to see cherry-picking of people who are considered low risk. Some of the packages being offered by insurance companies are tailored to attract younger people. As time unfolds, we expect that some people would become more high-risk when it comes to insurance cover. This should be reflected in how the HIA assesses the market.

The figures for the various age cohorts in the market are positive. Over 100,000 people have entered the market in recent times. I assume these are primarily from the younger cohort of individuals because of lifetime community rating and the upturn in the economy.

Other issues arise when we talk about private health insurance, private health care and the vibrancy of the market. We have to accept that 50% of people have some form of private health insurance. In that context, a broader issue arises in respect of how we provide services to people through the public health system. As the Minister is aware, we requested an extra €15 million for the National Treatment Purchase Fund for the purchase of additional health care for people who are on waiting lists. For the foreseeable future we must ensure that the National Treatment Purchase Fund is adequately resourced to enable it to buy health care, whether through the public hospital system by supporting public hospitals to expand their capacity or by buying private care.

I have raised the issue of scoliosis today already by way of a Topical Issue. I thank the Ceann Comhairle's office for facilitating me in that regard. I read three cases into the record and I have information on two more. Some of these cases are harrowing. The Government must be imaginative. I am in no way trying to be partisan or political. We must be imaginative in how we address this in the coming weeks and months.

The winter initiative has invested €2 million in this area. However, there are children aged five, six and seven years of age who have been waiting an inordinate length of time for life-changing surgery. If they do not get it, this illness will limit their lives. It is as serious as that. We have heard of cases involving children who had a spine curvature of approximately 35%. However, by the time they got to surgery, it was over 100%. That is an example of the severe impact of waiting times. I know of a case involving a child who is six years of age. The child can no longer retain his food because of the pressures on his stomach due to the curvature of his spine. That is an indication of the serious nature of this matter. I urge the Minister to address this. I have no monopoly on compassion. I urge the Minister to look at this in the most creative and imaginative way possible. I know the Minister has had contact with these families as well. The difficulty needs to be addressed quickly for this cohort of people on waiting lists. These people require surgery now. I will continue to raise the point in the hope that the Minister, the HSE and Our Lady's Children's Hospital Crumlin can use imaginative ways to speed up access to this life-changing surgery.

I recognise that commitments have been made for new theatres in Crumlin and the winter initiative and everything that flows from that. However, having examined the calendar and dates for these policies to be implemented, it is clear many of these children will be subject to severe and long-term damage while they are waiting. Some of the dates in question have been kicked out to July 2017 because of recruitment of additional consultants, etc. I understand that there are difficulties with the recruitment of theatre nurses but I believe the Government could be imaginative. If it is proving difficult to recruit on a long-term basis, then perhaps there could be some form of short-term contracts to bring in staff on a short-term basis. I am sure that with imaginative packages something could be done to bring in theatre nurses for these specific cases. We could recruit paediatric theatre nurses and additional consultants for several months to try to front-load the activity and capacity in Crumlin to address this particular issue. I urge the Minister to take action on that issue.

We will not oppose the Bill. We have always supported the two concepts of inter-generational solidarity and risk equalisation. The legislative programmes that have been brought forward in recent years seem to be working in this case.

In future, when the HIA makes recommendations the associated reports should be published as well.

When a report is being acted upon and when we bring forward legislation in this House, the very least we should have is the report on which the legislation is based so that we can make an informed decision. While we do not distrust the information the Minister gives us, at the same time we would like to see the reports. Reports on which legislation is based should be published as a matter of form. If there are challenges in the insurance industry and the broader private health insurance market, we would like to be able to see a report to that effect to make our own assessments of it.

Overall, this Bill will increase premiums and that will place additional pressure on families. I urge the Minister to consider the regressive nature of the stamp duty in that regard. Perhaps some tweaking is possible to lighten the burden on those who are already struggling to hold private health insurance and move to a situation in which those on higher premiums, who potentially have more flexibility in their disposable income, be considered as well. However, we must remember that there were tax reliefs and changes in budgets presented by the Minister for Finance, Deputy Noonan, in previous years which at the time were described as gold-plated insurance premiums and so on. There is no doubt we must accept that this policy change impacted on the cost of private health insurance for ordinary working families as well, even though it was said at the time that it would not have that impact. Sometimes people in their contributions on private health care put forward the view that the people who take out private health insurance are just the affluent and those who try to queue-jump and that there are gold-plated circles. There may be people who have substantial sums of money in this country, but when one considers that half the population takes out private health insurance, it must be acknowledged that these are just ordinary working families. As I said, they take it out for many reasons, among which the fact that they do not have confidence in the public health system. We must collectively address that in this House. I would like to reach a stage at which private health insurance is seen as something to be availed of not out of fear of a public health system not being able to deliver but because those who are insured want additional services available, as opposed to the basics, namely, treatments and diagnostics.

I look forward to the debate on Committee Stage. I ask the Minister to consider the regressive nature of the proposed duties.

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