Bernard Durkan (Kildare North, Fine Gael)
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203. To ask the Minister for Health the extent to which the current private health insurance costs have been assessed with a view to identification of the most obvious issues contributing to escalation; the steps that can be taken to ensure a continuation of community rating at an affordable cost in the short to medium term; and if he will make a statement on the matter. [21781/14]

James Reilly (Dublin North, Fine Gael)
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I have consistently emphasised the need for much greater cost control in the private health insurance industry so that premiums are affordable for as many people as possible. My Department and the Health Insurance Authority (HIA) monitor the factors that contribute to costs on an ongoing basis.

The health insurance market is challenged by factors such as an ageing population, a reduction in numbers holding private health insurance and constant pressures on claims costs. In this regard, I appointed an independent chair to work with health insurers, the HIA and my own Department, to identify effective strategies for costs management. Mr. Pat McLoughlin's first report, published at the end of December, made a number of important recommendations now being pursued by insurers, the HSE and my Department. These recommendations include measures to control costs, greatly improve clinical audit, streamline claims processing and address fraud, waste and abuse in the industry. Work on Phase II of Mr. McLoughlin's report is progressing well and will be completed as soon as possible.

I am keen to create the best possible environment within which more people will want to obtain and retain private health insurance cover that is affordable, competitive and meets consumers' needs was we prepare to move to Universal Health Insurance.

In particular, I want to encourage younger people to join as early as possible. With this in mind, I will shortly be announcing important initiatives from 2015 in relation to Lifetime Community Rating and discounted rates for young adults. Lifetime Community Rating is intended to encourage people to join health insurance schemes early and to retain their private health insurance cover. Discounted rates for young adults are intended to help address the sharp increase in the cost of insurance faced by young people or their parents around the age of 21 years, when child and student discounts normally cease. My Department is working on the legislative changes required to implement these measures and it is intended that these two initiatives will operate from 2015, allowing for an appropriate notice period for both customers and insurers.