As senior Ministers prepare to consider radical proposals for the introduction of universal health insurance next week, the Opposition has strongly criticised the plans as “representing a major tax hike”.
The Irish Times reported yesterday that under draft proposals drawn up by Minister for Health James Reilly, people who refuse to purchase mandatory cover for a standard or basic package of health benefits would have the costs deducted from their earnings or benefits.
The draft proposals were last week strongly criticised by the Department of Public Expenditure and Reform as being effectively unaffordable and threatening the financial stability of the State although these charges were strongly rejected by the Department of Health.
The Cabinet subcommittee on health involving the Taoiseach, Tánaiste, Minister for Finance and Minister for Public Expenditure and Reform and the Minister for Health will consider the proposals on Monday. Sources said there had been no further observations on the proposals issued by the Department of Public Expenditure and Reform since last week.
Risk-rated
The Minister's proposals would for the first time also introduce a partial risk-rated health insurance market in Ireland, a dramatic change from the traditional system where all policies were covered by the principle of community rating under which everyone pays the same for identical products regardless of age.
The full impact of this reform will probably not be known until the composition of the standard package of benefits – which everyone must purchase – is finally determined.
Senior health service sources have argued that the introduction of some elements of a risk-rated market should not translate necessarily into higher cost plans for older people.
Under the proposals people will be permitted to take out supplementary health insurance for products not in the standard basket of services or for private facilities.
However, these policies will be sold on a risk-rated rather than community-rated basis.
Taxation
Health sources said that some services not included in the standard basket would be funded by the Government through general taxation such as emergency department care and ambulance services.
However health service sources accepted that a small number of procedures such as pure cosmetic surgery could be classified as outside the standard basket and would therefore have to be paid for under a risk-related policy.
Fianna Fáil health spokesman Billy Kelleher said Dr Reilly's proposals represented "effectively the equivalent of a major tax hike for a great many people".
“The Department of Public Expenditure has estimated the average cost of a policy under Reilly’s plans to be €1,600. For the great many people who cannot currently afford health insurance and do not qualify for a medical card, this would be an unacceptable and unaffordable burden .”
