THE British based health insurance company BUPA will be competing with the VHI by the end of the year. BUPA announced yesterday it was setting up a new company, BUPA Ireland Ltd, which would offer a range of insurance and health care products to Irish customers.
The Minister for Health, Mr Noonan, welcomed the competition BUPA would provide, but said any insurance company offering health cover would have to provide "open enrolment and community rating".
Open enrolment means one cannot be turned down for health insurance on age grounds and community rating means similar premiums must pertain for all consumers.
"It means that no insurance company can cherry pick in the market," a spokeswoman for the Department said last night.
The general secretary of the Irish Hospital Consultants' Association, Mr Finbar Fitzpatrick, also welcomed BUPA's announcement, saying the IHCA had campaigned for competition, in the health field since its inception seven years ago. He said the IHCA would be seeking an immediate meeting with BUPA's Irish staff to discuss its plans.
The managing director of BUPA Ireland Ltd is Mr Martin O'Rourke, former assistant chief executive of the VHI, where he had responsibility for operations and corporate planning. He has been an independent management consultant since last year.
Details of what BUPA will offer will be made available after the company has had discussions with doctors and hospitals and considered the Irish market, according to the chairman of BUPA Ireland, Ms Margaret Downes.
BUPA Ireland will have offices in Dublin and Cork, and intends to employ 40 people initially, Ms Downes said. "Irish consumers will benefit from increased competition by the arrival of a strong, international, innovative health care company.
The company insures more than three million people in 115 countries, over two million of them in the UK. Its largest centre outside the UK is Spain, where it bought the second largest health care organisation there, Sanitas. BUPA is also a majority shareholder in the Blackrock Clinic.
It operates 29 hospitals in Britain and has 33 private health screening clinics across Europe, including Britain. It has 45 per cent of the private health insurance market in the UK, 60 per cent of which is taken out by employers. As well as providing, health insurance, it offers programmes to encourage health awareness in the work place, Ms Downes said.
She said there are no plans at the moment for BUPA Ireland to open or run hospitals or clinics. While details of what would be offered to Irish customers had not been worked out, a screening service was likely.
The BUPA announcement yesterday comes almost two years after an EU directive on non life insurance came into force on July 1st 1994, ending the VHI monopoly. The Government introduced health insurance legislation that year, specifying two elements which had to be maintained community rating and open enrolment. These conditions made the Irish market unattractive to other European insurers, and none of them has sought entry until now.