More than 400,000 subscribers to BUPA Ireland are facing a 6 per cent increase in private health insurance charges from the beginning of March.
The company blamed the rise on a recent decision by the Minister for Health, Ms Harney, to increase the cost of private beds in public hospitals by 25 per cent.
The increase will see the cost of BUPA Ireland's mid-range Essential Plus scheme for two adults and two children rise by around €78 per year.
The Government said before Christmas that it had increased the cost of private beds in public hospitals as a step towards ultimately charging the full economic cost of these facilities.
The 25 per cent increase in the private bed charges in State hospitals is likely to lead to other health insurers raising their prices also in the months ahead.
A spokesperson for the country's largest private health insurance company, VHI Healthcare, said last night it had no plans at present to increase subscriptions.
However, the company has acknowledged that the increase in the private bed charges announced by Ms Harney in November was equal to an increase in premium of around 5 per cent.
This additional cost is expected to be passed on to subscribers when VHI reviews its charges in the summer.
The most recent entrant to the private health insurance market, Vivas Health, also said it had no plans at present to review its charges. However, its cost base will also be affected by the increase in the cost of private facilities in public hospitals.
The increase in BUPA subscriptions yesterday prompted a new spate of claim and counterclaim between the largest two health insurers over value for money in the sector.
BUPA Ireland said that even after the increase in its subscriptions, a family of two adults and two children on its Essential Plus scheme would still save around €144 annually compared with those with a similar level of cover provided by rival companies.
The managing director of BUPA Ireland, Mr Martin O'Rourke, urged consumers to shop around for the best value. He said the new increases in charges would enable it to maintain and improve its level of benefits for subscribers.
A spokesperson for VHI said that the price increase announced by BUPA yesterday was twice the size of the rise which it put in place last September.
Vivas said in a statement: "Consumers should be encouraged to shop around to access value in the health insurance market."
