Thursday, 22 March 2012
Finance Bill 2012 (Certified Money Bill): Committee and Remaining Stages
Sean Barrett (Independent)
I move recommendation No. 21:
In page 186, to delete lines 20 and 21 and substitute the following:
“(b) €285 in respect of an insured person aged 18 to 60 years, and
(c) €95 in respect of an insured person aged 60 years or over.”.
I welcome the Minister back to the House. Section 105 and recommendations Nos. 21 and 22 deal with the health insurance market in Ireland.
While in theory the levy is used to cross subsidise the insurance bills of older people in the health sector I am not sure that is fact. There was never any evidence that competing insurance companies were unwilling to provide insurance. During the court cases in which the State was involved it never produced a witness aged over 60 or 85 years who had been refused cover. I believe this is a subterfuge by the Department of Health to subsidise VHI and to restrict competition, which I believe it does. It also distorts the market.
Why for instance are we imposing this levy on people aged over 60 years and telling them, despite that in doing so we have added to their bills, they can now afford health insurance? If this was sincerely about elderly people they would be exempted. The amendment seeks to introduce reduced fees. A case on this matter was brought before the European Court and the Supreme Court and was lost. The goal of Government appears to be to protect the VHI rather than the consumer. We have a regime of open enrolment lifetime cover and community rating, which means one cannot discriminate on pricing between people of different ages. We have discussed this matter with the Minister for Health, Deputy Reilly. The Leader also obtained a copy of the Milliman report on operation of the VHI for us. The subsidy is distorted into huge costs in the Irish health service. It is difficult for the Minister to control costs because he is at the centre of the service and the patient cannot do so because he or she is sick. Competing health insurance companies could control them.
Evidence which has recently come to light in this area confirms the view I have expressed. The Milliman report looked into the VHI and why it requires so much assistance, one of the reasons being that a treatment which under best practice should require 3.7 days in hospital requires 11.6 days here. If this subsidy were not distorted into high cost health services and so on and if we had competition in the health insurance business and the required hospital stay was reduced from 11.6 days to 3.7 the result would be a €1,000 per night saving. This would feed into public patient services and would be particularly good news for the Department of Finance given the health budget is one of the most difficult to control. The Minister, Deputy Noonan, as a former Minister for Health, will be only too well aware of this.
The Leader provided us with a heavily redacted copy of the Milliman report, which deals with efficiencies in VHI and what is being supported by the levy. An unredacted copy of the report might yield substantial savings for the Minister and his Department. We have put off addressing this problem for long enough. As I mentioned earlier, cases before the courts on this matter were lost. I suggest that a much better alternative to any of the levies in this area would be to let loose officials from the Departments of Finance and Health on an unredacted copy of the Milliman report in order to see how unnecessarily long stays can be reduced resulting in substantial savings.
In the meantime, a levy should not be imposed on older people so they can afford health insurance. The reason I tabled this amendment is it appears there is documentation in the Department of Health, which it is hoped will be made available to the Minister for Finance, which states we do not have to pay that much for health insurance in Ireland. Also, we do not have to pay that much for health care. If the culture of keeping private patients in hospital for 11 days when they could be released in 3.6 days extends to public patients we are looking at a major item of public expenditure which needs to analysed. I gather from the Minister that Milliman is currently working with the Department of Health. I suggest they should also be working with the Department of Finance. This is an area where savings are needed. I hope this is the last time such a levy is imposed and that we spend the next years examining the waste which if addressed could result in a reduction in the cost of health insurance and health care in general in Ireland.