News Colum Kenny

Thursday 21 August 2014

Health cover now a complete shambles

Pay for a private health insurance policy and get peace of mind, right? Wrong.

Published 05/01/2014 | 00:55

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Health insurance is now a major worry for many

NO NEW income taxes in 2014? The Government has got to be kidding. This Government may not call it income tax, but yet another hike in private health insurance, and a further reduction in tax relief of the payments for it, are among new expenses that amount to the same thing.

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I am one of the falling number of people still paying for health insurance. And I realised last week, when my renewal fell due, that the standard level of VHI cover has gone up in price yet again. It will cost me and my wife over €400 more than it did this time last year.

On top of that, we will no longer get tax relief on the whole payment — not even at the lowest rate of taxation to which tax relief had already been reduced.

The Government has shifted health costs to patients willing to pay for insurance, it continues to waste money paying drug companies more than they get for their drugs in some other European countries and it presides over a system where professional fees are also out of kilter with those in other EU states.

When the Government capped tax relief on health insurance during 2013, it mis-informed the public. We shall not call it lying, because it was no doubt an honest mistake on the part of the minister or his spindoctor.

At first the public heard that only those with “goldplated” insurance policies would be hit by the cap on tax relief. Few people have “gold-plated” policies.

But soon Finance Minister Michael Noonan had to correct the record. Or, rather, his officials acknowledged quietly that more than half a million people who pay for health insurance would be hit.

And later, that figure was revised slightly upwards. When I say “slightly” I am being kind to the minister. For we are talking in fact of a revision upwards of more than 100 per cent. It turned out that more than a million policyholders are being stung.

But who cares if the Department of Finance gets its figures wrong? These are not figures that matter. Because the middle-class people in the firing line have no real choice but to stump up for private health insurance.

Or, rather, they have one very real choice. To stop paying it. Very large numbers have already done so because they can no longer afford health insurance. Many such people will not be eligible for medical cards. If they get sick, they will be left to their own devices. Hard luck.

And increased costs, as well as the capping of tax relief and the carelessness of ministers about consequences, are not even the half of it when it comes to the problem of private medical insurance.

For trying to figure out which policies cover what, and to what extent exactly, is like entering a complex maze. There is much that most policies no longer cover.

The basic principle that you pay for a policy and get reasonable security of mind no longer applies as it once did. There are all kinds of exemptions and catches, and no two policies appear to be the same. The myth of choice has become the reality of catch-you-out.

Once, it was simpler. Once, for example, on a policy like mine you would be covered for most of the cost of GP visits after a certain amount if you fell ill in a particular year. Now the equivalent policy covers no visits to the GP.

While the cost increases, the ground shifts from under you. Once you were covered for a semi-private bed if you went into hospital. Now you have to be really careful if you fall ill that you do not go to a hospital where your insurance covers only 40 to 50 per cent of a semi-private bed. You could end up with a whopping bill. And the “semi” in “semi-private” long ago ceased to guarantee you half a room.

And such catches apply across the board. It is just the kind of uncertainly that you do not need when being admitted to hospital or for tests, being forced to try and work out how much of each kind of test is covered, if it is covered at all.

And the amounts covered are risible. Maybe €60 or €70 for each consultant’s visit, when consultants charge two or three times that amount. We have make-believe health insurance for a make-do medical system.

Perhaps the most enraging pieces of advice from ministers is the glib one to “shop around”. The whole system is now a minefield of so many policies that the average person cannot compare them in any meaningful way.

For example, when I go to the special Health Insurance Authority website where one is supposed to get comparisons and I enter my current VHI policy name, the system throws up no less than 132 plans that “match my search”. This is dispiriting.

It soon becomes clear that each plan is in fact different and none matches my search in the sense of getting an exact

and clear match at a lower price. The detailed variables are sprawling and serves only to confuse customers rather than to reassure the public.

Why can the Government not set out clearly, let us say, three categories of policy that it regards as socially and politically desirable in terms of delivered private health insurance cover of a kind that gives people real security and confidence in times of illness? Then let the various private companies compete for those exactly defined products. And so let voters see if the Government even understands what is at stake anymore.

Many people who formerly paid for health insurance can no longer afford it, and are now dropping out of the system. Many more invisible young adults, whose parents can no longer afford to insure them (whether these young adults are working in insecure and low-paid jobs in Ireland, or emigrating), have no cover if they get seriously ill.

If the Government is partly about creating a health insurance system that works reasonably well for average citizens, then the shambles that is now private health insurance suggests that this Government has failed in that respect.

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