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Laya boss: Donal Clancy

Laya boss: Donal Clancy

Laya boss: Donal Clancy

IRELAND'S second-biggest health insurer has warned the Government that further increases in levies and medical costs will drive a sector already in crisis into meltdown.

Laya Healthcare will today outline a series of proposals which it said would help stabilise the Irish health insurance market.

The Cork-based insurer, which has almost 500,000 members, has staunchly supported the proposed lifetime community rating, increased regulation of the State-owned VHI and other measures aimed at driving cost efficiencies with the healthcare sector.

Laya boss Donal Clancy has already sent a detailed briefing proposal to Health Minister Leo Varadkar and Finance Minister Michael Noonan on the crisis now gripping the private healthcare sector.

Since Ireland's economic crisis erupted in 2008, almost 300,000 people have quit the private healthcare market.

Almost nine out of 10 cited spiralling policy costs as their primary reason for opting out.

On average, between 6,000 and 7,000 people a month are now cancelling policies on affordability grounds - all of who then have to rely on public healthcare.

Customers

Fears are mounting that unless health insurance costs are reduced, the sector could lose 500,000 customers - one in four clients - by 2015/16.

"Laya Healthcare is asking that no new penalties, namely an increase in levies or a further cap on tax relief, are introduced in Budget 2015," Mr Clancy said.

"The sector is in crisis - that is obvious for everyone to see. It is simply not sustainable for the long-term if the current situation is allowed to continue."

Policy costs have soared in Ireland since 2008.

In January 2009, a basic private healthcare plan for two adults and three children cost €158 a month - the comparable policy today costs over €278.

Healthcare firms such as VHI, Laya and Aviva are worried that if the numbers quitting the sector continues to spiral, the costs for those remaining with cover will continue to rise.

Ireland currently has around two million people with private health cover. However, if the continue rate of people quitting the sector continues, one quarter or almost 500,000 will have opted out of private health cover by 2015/2016.

Despite the decline, Laya has continued to increase its customer base.

Irish Independent