Colm Burke (Fine Gael) | Oireachtas source

I welcome the Minister. I, too, welcome this Bill in the sense of having a debate on this important issue. Major changes have taken place over the past three years in the health care sector and it is important we debate and scrutinise everything that has happened. In fairness to Senator Quinn, much work and research have been done on this Bill and I thank him and his assistants on the work they have done in carefully drafting the Bill. They dealt with three key issues. I suppose one of the reasons he raises this whole issue is as a result of the European Court of Justice ruling in 2011 and the request by the competition section of the European Commission that the Irish State end the unlimited guarantee provided to the VHI. In fairness to the Minister and the Department, they have responded to those issues.

As has been outlined, the three major components of the Bill provide for the transfer of responsibility for the management of the State's ownership of the VHI, require the VHI to meet its solvency requirements and propose the dissolution of the Health Insurance Authority. The Minister dealt adequately with these three components and has made most of the points I wanted to make, but on the solvency requirement, the VHI made an application on 17 June for authorisation and secured a four year reinsurance deal. The solvency issue would appear to have been dealt with and it will not be a concern from the State's point of view.

The fact the VHI made a profit in the past 12 months of more than €65 million shows careful management by the company of the premiums it charges and scrutiny the claims being made.

The Minister has responsibility for maintaining the stability of the health insurance market, which is important because, as he noted, more than 44% of the population have private health insurance. Before the Government took office, a major insurance company, albeit one that is not active in the health area, reinvested a sum of approximately €350 million in other markets, despite the requirement that this money be set aside to ensure sufficient funding was available for claims. The Minister has an important role in maintaining stability, ensuring uncertainty does not arise, guaranteeing full accountability and protecting policyholders. It is important that the Department continues to play a key role in these areas.

Section 3 dissolves the Health Insurance Authority, which plays an important role in the current market. While major changes have been introduced to the way in which the Central Bank works, I am concerned about the proposal to add another function to the Central Bank following the dissolution of the Health Insurance Authority. We need to have one body with the principal function of ensuring everything is above board in the health insurance sector.

Health insurance is an extremely important industry in which large sums are paid over by policyholders to health care providers. The Health Insurance Authority plays an important role in regulating the issue of solvency and ensuring insurance companies comply with current regulations. Its role also includes monitoring the insurance market, advising the Minister and operating the risk equalisation fund. This fund is extremely important because one insurance company, the VHI, is carrying a high proportion of older policyholders who are responsible for a greater number of claims than other age groups. Risk equalisation is an important tool in ensuring he age profile of policyholders is properly managed.

The Health Insurance Authority also provides consumer information. It is important that information is provided on the products provided by insurance companies. While the companies will engage in their own marketing efforts, it is important to have an independent authority monitoring the market and ensuring correct information is available to consumers.

I welcome this debate. Major changes will be made to the health service through the introduction of universal health insurance. It is important to have proper structures in place for the transition and the Minister is taking the correct steps as he moves towards the introduction of universal health insurance.