Health insurance costs are on the rise again. One million customers of Laya and Irish Life face increases in many cases running into double digit percentages in coming months and this was followed by announcement from the VHI of a 7 per cent rise. Premiums fell on average last year but have rebounded strongly and look set to remain under upward pressure. Post-Covid, claims numbers and costs are firmly on the rise.
There are short- and long-term issues here. In the months ahead, the key issue for consumers is, of course, that many will be facing much higher costs. We must hope that competition, overseen by the Health Insurance Authority, is operating properly and that Axa’s recent purchase of Laya Healthcare will give it some additional impetus.
There is, however, evidence that the sector relies on the inertia of many customers, using new, cheaper policies to attract fresh business, while levying more from current policyholders. The message to customers is to shop around ahead of their policy renewal. They have nothing to lose; existing benefits will be retained if they move to another provider.
The longer-term issue for health insurance, meanwhile, brings some uncertainty. What is its role if the Sláintecare programme is fully implemented, removing private healthcare from public hospitals? In one scenario, the sector warns, this could lead to a loss of young members and a sharp rise in premiums for those remaining. This would happen if Sláintecare’s targets of cutting waiting lists and providing reliable services is met.
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In another scenario, if long waiting lists and other deficiencies remain, there may be an incentive for private hospitals to provide wider services, though whether this could be supported via a health insurance model is unclear. Either way, the challenges of reforming the healthcare system towards the desirable goal of universal access to decent services is complex and the pace of reform to date shows that there is a long way to go and some uncertainty about the final outcome.