John Gilroy (Labour) | Oireachtas source

I welcome the Minister to the Chamber. I also welcome this important and rather complex Bill. Senator O'Donovan put his finger on the nub of the complexity of this legislation when he suggested that the positive outcomes from it might not be immediately obvious in the short term. As the Senator suggested, in five years or so we might begin to see real reforms and savings in this area. While the question of health insurance provision policy is a difficult one, I suggest it might not be as difficult as we think it is. Perhaps it suits many people in the industry to portray it as opaque. When Bupa pulled out of the market some years ago, the threat of the sky falling in did not materialise. When Quinn Insurance went to the wall, the transition to a new provider was rather seamless, albeit expensive. These examples suggest that the opaque nature of the conversation about health insurance might be somewhat manufactured.

The Minister reminded us that this legislation passed through the Dáil unopposed. While I am glad that is the case, I am not terribly surprised, given that the legal framework supporting intergenerational solidarity, which is expressed through risk equalisation and community rating, enjoys wide support in our society. Having said that, if I understood correctly what Senator Barrett was saying about some studies to which he drew attention, they seem to call the entire concept of risk equalisation into question.

The key to providing affordable health insurance is to ensure that as many younger people as possible - those who are generally associated with enjoying better health statuses - get involved in buying policies so that they can support older people and people who enjoy fewer health benefits. I think we can welcome the idea of introducing a late-entry loading after the age of 35, especially as the suggested loading of 2% per annum is not terribly excessive. Having said that, we need to explain the proposal carefully because there is a great chance of mischief creeping in and this being misrepresented as something bad, when in fact it is something very good. The technical nature of this legislation means that it requires careful consideration and careful selling to the public.

The reduction of the levy to a level of virtually nothing initially, before it is set at a rate of 25% lower than it is at present, is certainly welcome. When taken with the reduction in stamp duty on all policies, it will lead to the accrual of significant savings. Can the Minister tell the House whether these reductions will be reflected in cheaper premiums? If they are absorbed by the industry, what mechanisms will be put in place to ensure those who buy health insurance policies see these savings?

Senator Barrett drew attention to the increase of 58% in the cost of health insurance since 2008. I was not aware of that, but it is rather alarming that such a substantial increase could take place. I wonder how much of this increase is accounted for by certain things within the industry. I could cite any number of anecdotal accounts of seemingly exorbitant charges that have been applied by some health providers to the health insurance industry. When the insurers are challenged on these apparently exorbitant costs, they say that they are part of a negotiated scheme and that savings are accrued in other places. It is difficult to obtain any information in a simple and understandable format from the health insurance industry when one questions it or from the health providers.

I have attempted to do so on many occasions and, invariably, I have come away none the wiser. Does the Minister see any role for the consultative forum to have an involvement in the negotiations between the health providers and the health insurance providers? If not, is there any other mechanism by which his Department or any other agency could take a closer look at the issue? I point to the case of a woman who told me her 15 year old son suffered from cardiac arrhythmia which was discovered when playing sports. As the waiting list was too long, they went private and the insurance company paid for it. The accommodation costs for two nights was €17,000. One could get a month in a hotel in Florida for the same accommodation costs. When we questioned it, we got no answer, no breakdown of the costs and how it could be that such an exorbitant fee was charged by the hospital and the health insurance company appeared quite happy to pay it.

The Labour Party will support the Bill which is long overdue. Senator Denis O'Donovan said that had this taken place ten years ago, we would see the benefits of it now. In supporting the Bill and commending it to the House, I would like to hear the Minister on the few points I have raised.