Health minister Reilly claims health insurers don’t have to pass levy increase on to customers
HEALTH Minister James Reilly has claimed health insurers don’t have to pass on a levy increase to customers.
“Private health insurance is a profitable business, and the greatest profit is taken from the youngest and the fittest. Insurers don’t have to pass this on. They can reduce their profit on this group of clients”, he told RTE Radio’s News At One earlier today.
When pressed he stated he believed private health insurance companies could absorb the entire cost of the levy increase.
The Minister also claimed that some health insurance companies are paying higher commission to agents for landing customers under 40.
“They even pay a high percentage of commission to their agents for people under 40 years of age. They don’t pay the same commission or anything like it for the older clients.”
He added that the levy should make older clients more profitable for newer companies entering the market.
He also confirmed the government was examining the possibility of life time community rating in order to make the market fairer.
The money raised from the levy will remain within the health insurance market.
The minister denied claims that the move will drive people from the private health insurance market.
“60,000 people per annum over the last four years have left the insurance market. That figure will remain there or there abouts.” He said.
Donal Clancy Laya Healthcare’s managing director, said the company had no option but to pass the cost on to customers.
“I’ve no idea where the minister gets his figures from. Rather than justify why one has to make profits I can guarantee you we’re not making extortionate profits as he suggested.
“We found out these details last night and I can tell you that it’s in the region of €20-30m and if we have to pay out that money we’ll have to collect that money. We don’t have profits in any region of that number.”
He also categorically denied the Minister’s claims that insurance companies pay higher commission to agents who land customers under 40.
“There was an insinuation we give different commissions. We don’t give commission to anybody. I can’t speak for any of the other insurers in that respect, but from Laya’s point of view we don’t pay commission.”