Small increase in numbers with private health insurance, says Varadkar

A small increase in the number of people with private health insurance was recorded in the third quarter of this year, Minister for Health Leo Varadkar has said.

“This is a positive development, but it would be foolish to read too much into any one quarter,’’ he said.

The Minister was speaking in the Seanad, where he introduced the Health Insurance (Amendment) Bill 2014, specifying risk equalisation credits. It also specifies the allowable rate of the net premium payable for young adults and provides for the transfer of an insured person from a restricted membership undertaking without an additional waiting period.

Mr Varadkar said the private health insurance sector had experienced great difficulties since the economic downturn. Coverage had fallen from a peak of just under 51 per cent of the population in 2008 to 44 per cent in June 2014.

Average claims costs per insured persons rose by 12.6 per cent from 2008 to 2012. However, for the first time, there was a welcome reduction of 2 per cent in average claim costs in 2013, and he would continue to monitor data to ensure it was part of a continuing downward trend, he said.

Mr Varadkar said the reduction in those without health insurance had improved from a fall of 63,460 members, in the year to mid-2013, to 36,538, in the year to mid-2014.

The Minister said lifetime community rating would be introduced from May 1st, 2015. This would result in late-entry loadings for people aged 35 years and over, who purchased private health insurance for the first time or renewed after a break in cover of more than 13 weeks.

The loadings, he added, were set at two per cent per year, starting at age 35 years, up to a maximum loading of 70 per cent at age 69 years and over.

The Minister said the Bill provided for the introduction of a young adult rate of premium that was aged-based rather than student-based and was designed to smooth out the rise in premiums between child and full adult rates.

The policy change would remove the requirement to be the dependant of a policyholder or a full-time student dependent on parents, he said.

The Bill, which has passed all stages in the Dáil, was supported by the Opposition parties.

Independent Senator Sean D Barrett said he had misgivings about what was proposed.

“The McLoughlin report shows that we have now chosen to target people in very difficult circumstances,’’ he said.

“Young adults are going to have to pay more because the department is afraid they will wait to purchase health insurance until they are older.’’

Mr Barrett said the report revealed a decline in graduate salaries, taking them below 2004 levels.

“These are also people who have serious difficulties with mortgages because they were on the wrong end of the property bubble, with which all of us on both sides of these Houses are still trying to cope,’’ he added.