Health insurance company Bupa will go out of business if the Minister for Health, Mary Harney, triggers the controversial risk-equalisation scheme, lawyers for Bupa have claimed before the High Court.
The court was told the scheme - which would involve Bupa paying a subsidy to its rival VHI to compensate for the VHI having a greater number of high risk, older and more expensive subscribers - is now on the Minister's desk.
Ms Harney has to give a decision by December 27th on whether to implement the scheme.
In court yesterday, Mr Paul Sreenan SC, for Bupa, sought the earliest possible hearing of its legal challenge to the legality of the scheme.
The case was a matter of critical urgency for all parties and would take six weeks when it goes to hearing, he said.
Mr Sreenan said the Minister for Health has the file for the introduction of the risk-equalisation scheme on her desk and reviews the situation every six months.
She has to make a decision on it by the end of the month, he said. If the scheme was introduced, it would put Bupa out of business.
Bupa is challenging the legality of the scheme under Irish and European law.
Mr Sreenan said Bupa has an annual profit of €23 million and the cost of the scheme would be €30 million.
If the Minister inroduced the scheme, Bupa would be deprived of any remedy and could not litigate, Mr Sreenan argued.
Mr Justice Liam McKechnie adjourned the matter until next Wednesday when a date in January will be fixed for the next hearing.
The VHI - with 1.55 million members - has said the risk-equalisation scheme is vital to the future of the community rating scheme under which health insurers must charge customers the same premium for a particular plan regardless of their age or health history.
Under the risk-equalisation scheme, the VHI's rivals - Bupa and Vivas - will have to make payments to compensate the VHI for the fact that its membership base is older and gives rise to higher claims costs.
It is estimated the VHI could receive up to €33 million under the proposed scheme.
