| 13.6°C Dublin

'Poor to pay for wealthy' health alert

LOW-income Irish families with 'Morris Minor' private health insurance plans will soon be subsidising wealthy families on 'Rolls-Royce' deals.

The warning has been sparked by an overhaul of the private insurance system in direct response to the Government's new Risk Equalisation Mechanism (REM) and the health levy.

One of Ireland's largest health insurers, Laya Healthcare, has warned that average health policy costs will soar by between 20pc and 40pc as a direct result of the new system.

 

Hospitals

 

Opposition health spokesman Billy Kelleher has warned that it is outrageous for 330,000 people on budget health insurance schemes to now risk losing full cover for private hospital procedures.

He said it is "a total disaster" for poorer Irish families.

"It is absolutely outrageous what is happening. We now have a scenario where people on 'Morris Minor' health policies where cost and affordability is the primary concern are now subsidising people on 'Rolls-Royce' schemes with all the additional benefits," he said.

"It just isn't fair and once again we have people at the lower end of the income scale paying the penalty," he told the Herald.

Mr Kelleher said that all schemes were being affected. The key fallout from the changes is that all insured patients will be charged for the use of beds in public hospitals.

Laya Healthcare boss Donal Clancy warned that the controversial changes may well represent "a tipping point" for the entire Irish health insurance sector.

"Irish health insurance is in the early stages of an upwards spiral which, if not reversed, will result in the market shrinking to a fraction of its current size," Mr Clancy said.

But the Government insisted it had to address the disparity in the cost of providing health insurance for different age sectors.

The average cost of providing health insurance for a person aged under 35 years is €700.

In contrast, the average cost for a person aged 75 years and over is €4,000.

 

Serious

 

The Government has argued that without the REM mechanism health insurance would effectively be made unaffordable for elderly people.

But Aviva chairman Brian Dunne said the medium-long term consequences of the price increases could be extremely serious.

He said that, given the continued pressure on household budgets, it was inevitable that the number of people abandoning the private healthcare sector would continue to spiral.

hnews@herald.ie


Privacy