The vast majority of consumers are retaining "some level of health insurance cover" despite economic difficulties, Minister for Health James Reilly has told the Dáil.

He said the numbers with health cover had been in decline since the peak of almost 2.3 million at the end of 2008. However, just over two million people, or 44.9 per cent of the population, currently hold private health insurance.

Dr Reilly listed the figures as he gave details of his Health Insurance Bill to implement risk equalisation in the private health insurance market.

Risk equalisation would be introduced from March next year but, insisting the legislation be introduced now, the Minister said he wanted to give insurers proper notice so they could regulate their products for the beginning of the new year.

New rates
He wanted to give commercial insurers as much advance notification as possible to allow them trade in the new rates into their business strategy for the year ahead in a planned manner.

It would also allow them “sufficient time to consider and review any actions necessary to avoid simply levying the full impact on to customers directly”.

Risk equalisation involved “looking at the market as a whole and to distribute fairly the differences that arise in insurance costs due to the different health status of the insured population”.

He said there were four insurers in the private health insurance market, but “there is clear disparity in the membership profile and thus the associated costs being incurred across the various commercial insurers”.

It would also allow them sufficient time to consider and review any actions necessary to avoid simply levying the full impact on to customers directly.

These revised risk equalisation credits were the latest measures to be introduced as part of an ongoing strategy to keep health insurance as affordable as possible, he said.

Cornerstone
"The community rating, reflecting the principle of intergenerational solidarity, is a fundamental cornerstone of the Irish health insurance market."

Under community rating everybody is charged the same premium for a particular health insurance plan, irrespective of age, gender and the current or likely future state of their health.

“Intergenerational solidarity between younger and older people also requires solidarity between healthy and less healthy people.

“So younger and healthier people effectively subsidise older and less healthy people on the understanding that these younger people will themselves be subsidised by later generations when they reach old age.”

The benefits of the Irish system could “best be seen as supporting the Irish market as a whole and ensuring that through the provision of risk equalisation credits for older customers, they can be helped and supported to purchase health insurance at an affordable price”.

Debate on the Bill continues tomorrow.