Proposed hikes to the health insurance levy will force more people to forego cover

Private insurance providers will address members of the Oireachtas health committee to warn them that increasing the levy will drive away even more people from health cover and will have a detrimental effect on the Government’s long-term plan to introduce universal healthcare. All insurers will meet members to discuss legislation which was recently published. At present, policy holders are required to pay a levy of €285 per adult and €95 per child annually for health cover.

If the planned legislation goes through, people will face costlier levies on premiums. Monies generated from the levy will be placed into a fund which is subsequently given to insurers who have a higher cohort of older customers as well as those more prone to illness. A key beneficiary of this funding is the fully State owned VHI which received €41 million in 2011. This has been criticised by the private insurers as they are subsidising the activities of what is effectively a Government body.

Despite many deciding to go without health insurance at a worrying rate, figures released by insurers have shown an increase in those over the age of 65 taking out a healthcare policy. While the principle of  “risk equalisation” where the cost of healthcare borne by older and ill people is mainly paid for by younger people makes cover more affordable for the former, it requires the latter to keep paying for cover in order to sustain the entire system – despite both groups being charged the same price.

Insurers have stated difficulties in engaging with Department of Health officials on the matter and were not privy to any developments. Further hikes to the health levy will also result in subscribers having to pay more for any procedure carried out in private hospitals as well as staying in semi-private rooms in public hospitals.