James Reilly (Dublin North, Fine Gael) | Oireachtas source

Many statements have been made here. I thank Senators for engaging with the Bill. The Central Bank is the Financial Regulator for the country and, as such, regulates for matters governing the prudential and solvency requirements for the health insurance market. Insurers wishing to operate in the Irish market must satisfy the Central Bank and other requirements before they are authorised to operate in the Irish market. It is the role and responsibility of the Central Bank to keep these issues under review and matters such as those raised by Senator Barrett are not appropriate to this legislation and, therefore, I cannot accept these amendments. However, I wish to say a few words about some of the comments he has made and also, perhaps, to address the issue of costs in VHI.

I agree with Senator Barrett that monopolies are bad. That is why under UHI we will have competing health insurers obviously heavily regulated by the Health Insurance Authority. I would point out that VHI has one of the lowest administrative costs of any insurer in the western world. I would also put it to him that if older people were not the heavier users of the service why is it that none of the new people who entered the market have not sought to attract them? I do not have the exact figures with me but one of the new insurers has attracted 40% of younger people. Clearly that is because they are producing products that attract younger people? Why are they not producing products that attract older people? It is glaringly obvious to everybody that his contention that older people are not greater users of the service is utterly wrong and misleading. While I do not have a vast array of information with me to underpin that I do have one piece of information that can be checked and verified, namely, that the average cost of a medical card is ¤1,000 or thereabouts. The average cost of a medical card for the over 70s is about ¤2,500. If that does not make the argument clear I do not know what does.

The Senator made other contentions. I have the report from the Health Insurance Authority from last month, page 13 of which states that the net cost for those aged 80 to 84 is 3.3 times that for the age group 18 to 29. I utterly reject that contention. Regretfully, I have to say to Senator Barrett that he is misleading the House with his selective quoting from the High Court case. The High Court case vindicated community rating and said there was a justifiable interference in the interests of the common good. It found against on one point only.

The European Court of Justice did not tell us that the Health Insurance Authority should not regulate VHI. It is for the Central Bank to regulate on prudential issues. In terms of the response to money for VHI insurers seeking to take on its older people, we have had a number of new entrants into the market. We have had two new players in the market in 2012, Swiss Re which underwrites Laya Healthcare and Munich Re which underwrites Glo Health. As everybody is aware the VHI share of the market is falling consistently and is down to 57%, yet it is responsible for 80% of the payout because of the much older profile of its clients. As a Government we said we would address the issues arising from the European Court of Justice case by the end of 2013. I cannot accept the Senator's contention around older people not being greater users of the service nor do I accept a very misleading comment he has made in respect of the High Court case. I regret I cannot accept the Senator's amendments and ask the House to reject them.