Warning over health insurance hikes
Hikes in health insurance bills for 1.4 million people will put more economic pressure on already hard-pressed households, Labour claimed today.
State-owned insurer Vhi said fees would jump 8% from next month, blaming the cost of funding the care of its elderly members.
The company says the price hike will come into effect from February 1 in order to fund high-quality healthcare needs of its customers.
The VHI has lost 120,000 customers during the last year.
"As a not for profit organisation the sole purpose of the price increase is to fund the healthcare needs of our customers," said Vhi Chief Executive Jimmy Tolan.
"We are particularly aware of the pressure that families are under and have kept the cost of a family of four on Plan B lower than it was this time last year.
"Our overall price increase is significantly lower than our competitors."
But Jan O’Sullivan, Labour Party health spokeswoman, said price jumps could deter people taking out insurance, placing extra pressure on public heath services.
“The announcement of an increase of 8% in VHI rates represents a further turning of the economic screw on hundreds of thousands of hard-pressed families,” Ms O’Sullivan said.
“The justification offered by private health insurance for increases over recent years was the rate of inflation.
“We are now experiencing significant deflation, but families are still being asked to pay even more.
“The net result of this is that we are likely to see a further fall in the number of people with private health insurance and this will, in turn, put more pressure on the public health service.”
Ms O'Sullivan said people were being expected to pay more for their health insurance despite significant deflation.
But despite the hike in charges Vhi said premiums for its family charge – two adults and two children – would fall by €4 because of a drop in the rates for child cover announced last year.
From February 1 Vhi customers will see the following changes to their annual premiums:
:: First Plan Level 1( for single adults) will jump from €640 to €680.
:: Plan B for two adults will jump from €1,656 to €1,813.98.
:: Plan B for family (Two adults and two children) will drop slightly from €2,256 to €2,252.14.
The state-owned insurer said it spent €1.3bn last year on claims, more than half on elderly customers.
It said it would suffer €170m in losses in meeting the needs of its older members.
“Age and health status are the greatest determinants of healthcare costs for our customers.
“There have been significant advances in technologies, new drugs and medical devices in the critical areas of cancer and cardiac care and these are having a positive impact on the quality of our customers’ lives.
“However, demand for healthcare services continue to increase and our biggest single challenge is funding our older customers healthcare needs within the current market environment.”
The organisation said it spends €900 per customer, twice that of its competitors.
Ms O’Sullivan said it was time for the state to roll out universal health care.
