Sir, - The contrast between the pricing structure adopted by BUPA on its entry into the health insurance market, and the community rating principle which underpins the VHI premium structure, poses very interesting questions of the Irish consumer. The younger consumer can make modest savings by choosing BUPA now, but the breakdown in the community rating principled means that the older consumer (age 60 plus) is unlikely to be able to afford anything other than the basic cover of BUPA's essential plan.
Community rating works, because it transfers small amounts of money from the relatively numerous younger people to subsidise significantly the premiums paid by the relatively few older people. It enables older people to have private medical insurance at a time when they need it most.
The principle and spirit of community rating is undermined by BUPA's pricing structure. Will Ireland's young, and increasingly prosperous, consumers jump at the chance to save 10 per cent on their health insurance premiums?
Or will they remember that they too will be old and vulnerable some day, and may need a little help from the rest of the community?
If they go for the BUPA option, my advice to them would be to spend premium savings now and enjoy it. For even if they put all the money they saved on health insurance premiums while they were young, and invested wisely, they still will not be able to afford comprehensive health insurance cover when they are old. I await their collective decision with interest. - Yours, etc.,
(aged 28), Old Rectory, Lucan,
Co Dublin.