Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Health when he will act to stop the rise in the cost of private health insurance; and if he will make a statement on the matter. [7880/13]

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

On 28 January I met with the top management of the VHI. It informed me of its intention to increase premiums by 8% having previously communicated an 11% increase. I told it in the strongest possible terms that this was not acceptable to me. It has since announced that the premium increase will now be 6%. However, I remain very concerned about the cost of health insurance and have requested the VHI to submit a detailed cost containment plan, which is in preparation, with clear targets and timelines under each heading so as to minimise the need for any future premium increases.

I have repeatedly raised the issue of the cost of private health insurance with insurers and am determined to address costs in the sector in the interests of consumers. Last year, I established the Health Insurance Consultative Forum which comprises representatives from the country's main health insurance companies, the Health Insurance Authority (HIA) and my Department. This forum was established to generate ideas which would help address health insurance costs, whilst always respecting the requirements of competition law. I have made it clear to the health insurers that I believe significant savings can be made, the effect of which can be to contain the cost of health insurance premiums. Given the VHI’s very significant share of overall costs in the market, I will continue to focus strongly on the need for the VHI to address its costs and to address aggressively the base cost of procedures, including professional fees.

The programme for Government commitment to put a permanent scheme of risk equalisation in place in the private health insurance market has been achieved following the passing, in December 2012, of the Health Insurance (Amendment) Act 2012. The new risk equalisation scheme came into effect from 1 January, 2013 when it replaced the previous interim scheme. This is a key requirement for the existing private health insurance market and is designed to keep health insurance affordable for older persons, to maintain the stability of the market and to contribute to the protection of affordability for those who need it most.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The Minister is totally inconsistent when it comes to private health insurance, in what he said two years ago and what he has done since he took office. Families are under huge pressure to pay and retain private health insurance. When the Minister brought forward the Health Insurance (Amendment) Bill last November he said that the lower plans would not be rated at the high rating of risk equalisation but when it came to the passage of the Bill all plans were rated at the high rating. That went against what the Minister had said on Second Stage. It has already had an impact on people's ability to retain private health insurance.

The Minister talks about universal health insurance and all that will flow from that. His policies to date are driving people out of private health insurance and forcing more people into the public hospital system which is against everything that he stated previously. Would he please explain why all plans were rated at the higher level in view of the fact that he said they would not be and the Health Information Authority also recommended that 47 plans should be on the lower rate?

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

It is very difficult not to remind the Deputy that during his party's tenure the price of premia went up and up and up. Since last year we have made serious attempts but they are not enough - more needs to be done and I have made that very clear in my initial response. We are reducing consultant fees, there has been a 15% reduction in the past two years, and the price of procedures has been reduced by between 13% and 53%. This has already been done. A payment scheme for radiologists and pathologists was introduced, based on the national quality benchmarks which will lead to reduced lengths of stay and has the potential to save €42 million per year for the VHI. The reduction in length of stay and price for some high volume procedures saved €7 million in 2012.

I could go on but I have advised the VHI that notwithstanding that it is responsible for only 57% of the market it is responsible for 80% of the pay-out. It must reduce the cost of each procedure. Why are we still paying the same rate for procedures that used to take two hours but now take only 20 minutes because of modern technology? We must pay by procedure rather than average length of stay which only encourages inefficiency. We have to introduce a more robust audit because the audit has clearly not been robust enough. Finally we need to bring in clinical audit so that clinicians are challenged as to why they are performing and repeating tests that others with a more objective view might say are unnecessary.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

This time two years ago the Minister was apoplectic with rage in this Chamber because the VHI had announced a moderate increase. Since he took office, however, we have had consistent increases, year in year out, month in, month out. The facts do not lie. People are dropping out of health insurance at an alarming rate. The legislation that the Minister passed and brought through this Chamber and the Seanad last year had a direct impact and forced health insurers to increase premia particularly on the lower plans.

Why did the Minister not take the advice of the Health Insurance Authority, HIA, and ensure the 47 lowest plans were on the lowest rate of risk equalisation? What changed in the meantime?

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I have discussed this with the insurance companies. They require very little modification for all to fall into the lower rating. When the Deputy's party was in power there was a 23% increase in 2008, 11% in 2009.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I am talking about 2013.

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Yes, but the Deputy has accused me of presiding over a rapid rise in premia.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

Five years ago, the Minister nearly fell over himself about the rise in health insurance when he was on this side of the House.

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Deputy's interpretation of events is somewhat at variance with reality.

Terence Flanagan (Dublin North East, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Minister to conclude without interruption.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The Minister should look it up on YouTube.

James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I will conclude. The figures I referred to are well above the 6% premia increase that is currently planned. The applications I have put into the system should not increase the overall cost of health insurance. It is about community rating and transferring the risk from the older and less well back to the young who are more well. That was always the way. It was the same when I was young and paying my insurance. I was subsidising older people. Community rating is accepted on all sides of the House.

Billy Kelleher (Cork North Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The problem is younger people cannot afford private health insurance.