GOVERNMENT CLAIMS that private health insurance premiums will not rise due to its proposals to sell off the VHI were dismissed as worthless by Fine Gael yesterday.
The party’s health spokesman Dr James Reilly said the official factsheet released by the Government with its announcement in relation to the planned privatisation of the VHI made no claim that premiums would not rise.
“This Government is a past master at doing the opposite of what it promises. The prime example is the health levy, which the Government claimed would not affect the price of health insurance, and would help to keep people in the insurance market.
“Yet premiums have shot up following its introduction, and people are now leaving the market in their droves. Some 4,000 people are dropping health insurance every month,” he said.
However, Taoiseach Brian Cowen again defended the Government’s plans for the VHI yesterday. Its privatisation was aimed at creating a sustainable health insurance market, he said.
Speaking at Portlaoise after the opening of the M7/M8 motorway extension, Mr Cowen said older patients’ welfare was a priority.
“What we’re doing is trying to provide more security for older and sicker people to ensure that there is inter-generational solidarity through having an effective risk equalisation system put in place so as to avoid any prospect of segmentation of the market where the costs of premia to older people would skyrocket,” he said.
“We don’t want that. We want to maintain the benefits and that characteristic of private health insurance and therefore you have to make some decisions,” he added.
Prof Charles Normand, professor of health policy and management at TCD, pointed out that most older and sicker people do not have private health insurance because they cannot afford it.
He said he believed privatisation of the VHI and risk equalisation probably would not make much difference to premiums.
“Premiums have been rising a lot partly because they used to be much more heavily subsidised than they are now. That was mainly because the VHI and other insurers bought hospital services at below the cost price. These prices have been rising and that’s one of the reasons why the premia have been rising,” he said.
Asked on RTÉ’s Morning Ireland if the proposed changes would increase health insurance premiums, he said the VHI would have to become profitable if competition from other insurers was strong and that would contain the extent that premiums might rise.
Socialist MEP Joe Higgins said the VHI plan was “a further instalment in this Government’s destruction of the very idea of a public health service”.