Richard Bruton (Dublin North Central, Fine Gael)
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Question 186: To ask the Minister for Health and Children the way she intends replacing the €1 billion paid to public hospitals by VHI and BUPA when the private beds are removed from these same public hospitals. [35507/06]

Mary Harney (Dublin Mid West, Progressive Democrats)
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Private health insurance companies do not pay public hospitals €1billion in respect of private beds in public hospitals. The €1billion paid out by private health insurance companies is an estimate of the total payments by the companies in respect of consultant fees, claims from private hospitals claims from public hospitals and claims in respect of out-patient services.

Our initial estimate of the income which could be lost by the public hospitals which was published with the policy direction back in July 2005 was €145m. This initial estimate was calculated in advance of the identification by the HSE of the public hospitals that would be participating in this initiative. However, in 2005 the private health insurance income to the 10 hospital sites selected as sites for co location was €111m.

Additional income to the hospitals in respect of the lease of the land will off set the loss of income from the private health insurers.

It has always been accepted that there will be a loss of income to the hospitals and that any net loss will have to be met by the exchequer. The impact of this initiative will not occur until 2009 when the new hospitals are built and is likely to be phased over a number of years.