Thousands of people cancelling private health insurance, says Martin

An estimated 140,000 people will have cancelled their private health insurance by the end of this year, Fianna Fáil leader Micheál Martin has said.

He told the Dáil that currently up to 6,000 people a month were opting out of health insurance. “The bottom line is Government policy is driving people out of the health insurance market. Families and individuals can no longer afford policies.’’

Mr Martin said the decision by Minister for Finance Michael Noonan to significantly reduce tax relief on health insurance policies in the budget had a huge impact on many people. "He pretended that the measure was for gold plated insurance policies but we now know that was an untruth as it affects up to 90 per cent of policies.''

Mr Martin said an additional bill of €30 million would flow from the decision to charge patients with health insurance for using public hospital beds, leading to a further increase. Earlier yesterday, he added, it had been announced that a 15 per cent stamp duty increase would be levied on policies.

“Cumulatively, in the short space of two months the Government has increased the cost of the average health insurance policy by €400. In many cases the amount will be higher.’’

Mr Martin called on the Government to reverse the budget decision on tax relief.

Risk equalisation
Taoiseach Enda Kenny said it was never an easy position to have to draft budgets in an area such as health given the economic circumstances. "I detect from the Deputy's question that he has changed policy in this regard. It appears that he is advocating the abandoning of risk equalisation and community rating.''

Mr Martin replied that he had not said that. “I referred to budget tax reliefs.’’

Mr Kenny accused Mr Martin of appearing to imply that there should be a change in Government policy, which would abandon older people to be manipulated by health insurance companies because they might well have higher costs in terms of their medical requirements and the treatment they needed.

Single-tier service

He said the clear objective of Minister for Health Dr James Reilly was to reform the health service and deliver a single-tier service in a way that allowed for older people to be charged the same rate for the same policy as people who were much younger.

The issue, he added, should not be underestimated. Every year 20,000 people reached the age of 65. In 2003 only 13 per cent of those who had health insurance were aged over 60; that increased to 15.9 per cent in 2009, and to 19 per cent in 2012.

“It is a fact of life that our population is ageing, and we will retain community rating and not have a situation where older people in our society are manipulated by health insurance companies that will seek to present health plans that effectively abandon the older population. We cannot and we will not do that.’’

Mr Kenny said that even in straitened times the Government still provided €400 million in support to policyholders through the tax system and €400 million in a subsidy to the public beds system because the full economic cost of beds in hospitals was not charged for.

Mr Martin asked if the Taoiseach honestly thought that increasing fees by reducing tax relief and charging for the utilisation of public beds by health insurance holders, even though they paid their taxes, would help community rating.

He repeated his request to reverse the budget decision on tax relief.

Mr Kenny said the answer was “no’’, adding that Mr Martin could not have it every way. The newer insurers could not just expect to have younger people who, naturally, required less medical attention than older people.