Written answers

Thursday, 13 February 2014

Department of Health

Health Insurance Prices

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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72. To ask the Minister for Health the extent to which he and his Department continue to monitor and address the issues which appear continuously to drive private health insurance premiums upward; the extent to which such premiums are affected by the public or the private health sector; and if he will make a statement on the matter. [6873/14]

Photo of James ReillyJames Reilly (Dublin North, Fine Gael)
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The main legislative provisions for the regulation of the Irish private health insurance market are included in the Health Insurance Acts 1994 to 2013 and Regulations made under those Acts. Under this legislation, my Department oversees the maintenance of a competitive and sustainable private health insurance market and monitors developments on an ongoing basis.

There are a number of factors which affect the cost of private health insurance premiums such as increased usage of hospital services and the increasing cost of claims, the age profile of those holding private health insurance and ongoing medical innovations which, while welcome, can have an impact on the cost of care. There has been a significant increase in private hospital capacity over recent years, which can be considered as a contributory factor to increased utilisation of private hospital accommodation. As a result, a significant number of private health insurance claims are for procedures which are performed in private facilities and the negotiated price for procedures in private hospitals is a "package" price, which may include the cost of surgery, drugs, pathology and accommodation. Taking all relevant factors into account, the insurance companies, operating as commercial providers, then make commercial decisions when setting their premium prices each year.

I have been strongly seeking much greater cost control in the private health insurance industry and have consistently emphasised the vital need to address the rising cost of private health insurance and the necessity for all private health insurers to address their cost base aggressively. Last year I established the Consultative Forum on Health Insurance, comprising representatives from the private health insurance companies, my Department, and the Health Insurance Authority, to generate ideas to address health insurance costs. I appointed an independent Chairperson Mr. Pat McLoughlin, who will work with my Department and the insurers under the auspices of the Forum on a review process to give effect to real cost reductions in the private health insurance market. Mr McLoughlin’s first report was published on 26 December 2013, and the second phase of the review has commenced and will report within three months. In particular it will study further the drivers behind rising costs in the PHI industry and seek to address them.

The Government remains committed to keeping down the cost of health insurance, so that it is affordable for as many people as possible, as part of measures to ensure the sustainability of the private health insurance market in the transition to Universal Health Insurance.

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