Liam Twomey (Fine Gael)

On the Second Stage debate it became clear that if the VHI has to increase its reserves to 40% it will need to get €140 million before the end of next year. While the Minister says it has the option to use reinsurance, such mechanisms incur costs which will eventually be passed on to the consumer. There is no need for a health insurance company to have reserves equivalent to 40% of its premiums. Health insurance is not like waiting for hurricanes or storms to occur. It is pretty much a standard operation and does not change dramatically year on year. If one compares the VHI's historical performance with that of life assurance or accident insurance companies, one sees nothing has changed dramatically in this regard over the past decade. The €300 million VHI has at the moment is more than adequate to cover it.

From the viewpoint of the consumer, and I am sure the EU would have no objection, the Minister should lower the reserve limit to 30%. At least that way customers will not find themselves making up the shortfall on behalf of VHI for no apparent reason. There really is no need. It is like banks or any other financial service one could talk about. Health insurance does not require such an enormous reserve.

I raised that specifically on Second Stage and I was hoping it would be dealt with. We must look at this from the customers' viewpoint. I raised another issue, too, on Second Stage. As with the Dáil, if the Seanad is to have these debates on Second Stage that specifically deal with customers, they should warrant attention. The VHI, to all intents and purposes, holds a monopoly position. The strength of that monopoly is evident in the way Quinn Healthcare has responded to the hospital consultants. On coming into the market it was going to be much more aggressive to change things. However, the consultants told Quinn Healthcare, in effect, that they would not see its patients unless they paid the same rate as the VHI. That is what a vested interest did within the health service, demonstrating the power the consultants have. The Minister can understand this because she is well informed on contract negotiations with the consultants. Effectively, the customer has no say. Once the VHI and the consultants decided what would happen, it did, and Quinn Healthcare had to toe the line.

One of the points I raised on Second Stage bore out this scenario and perhaps the Minister might insert this in the legislation before she loses complete control of the VHI. This legislation is about the Minister losing control of the private health insurance market as well. Before she does that, she should provide in the legislation for some type of nod in the direction of the customers. One of the things I asked for was detailed itemised bills, as with any other private health insurance company on the European market. That should be included in the legislation. If we take the trouble to make Second Stage contributions in the Seanad that might help the legislation, I would appreciate it if the Minister would say whether what is being suggested is completely wrong.

My three points are that there is no need for a large reserve, the VHI is a monopoly that does not protect its customers and the Minister should push for itemised bills so that customers know what they are paying for.