James Reilly (Dublin North, Fine Gael)
Link to this: Individually | In context

Question 231: To ask the Minister for Health and Children the progress made to date on the new risk equalisation scheme in view of the fact that it is ten months since the Supreme Court struck down her original scheme; and if she will make a statement on the matter. [22542/09]

Mary Harney (Dublin Mid West, Progressive Democrats)
Link to this: Individually | In context

Since the Supreme Court Decision of July 2008 that found the previous risk equalisation scheme to be ultra vires, my Department, the Health Insurance Authority and other interests in the Irish private health insurance market have met to discuss the creation and development of a replacement scheme to support the principles of community rating and intergenerational solidarity. The Supreme Court did not find against the principle of risk equalisation. Submissions have also been received regarding the development of a new scheme from a number of interested parties. The Health Insurance Authority will begin a consultation process in relation to the new scheme in the coming months.

Following the Supreme Court judgement the Health Insurance Authority noted that there was an urgent need for measures to protect the interests of consumers in a community rated market to address the fact that as persons get older they become more unprofitable for insurers and in the absence of any intervention the overall effect would be that on average older people would pay higher premiums for health insurance.

Given the importance of protecting the market and supporting the principles of community rating, intergenerational solidarity and recognising the higher costs that arise for older age groups, the Government decided that interim measures, as announced on 19th November need to be put into place in order to support community rating until such time as the new scheme is put in place. It is anticipated that they will remain in place for the next three years. These measures are set out in the Health Insurance (Miscellaneous Provisions) Bill 2008.

The interim solution consists of two distinct elements: an age-related private health insurance relief provided to individuals who hold private health insurance policies which aims to secure a health policy objective of achieving inter-generational solidarity in terms of assisting individuals to meet their health insurance costs on the basis of age and a levy charged on health insurance companies. This Bill also provides for additional measures that will enhance consumer protection and increase the regulatory powers and functions of the Health Insurance Authority.