THE REPUBLIC’S two million private health insurance subscribers could face additional increases of up to 5 per cent on their premiums under proposals to significantly increase charges for private beds in public hospitals.
The proposals are to be published today in a report by a Government-appointed steering group.
This has recommended that the Cabinet could consider increasing the charges for private beds in public regional and teaching hospitals by up to 15 per cent to meet new estimates for the economic cost of providing such facilities.
The cost of private facilities in HSE county hospitals could rise by up to 38 per cent.
The report says such an increase would generate an additional €50.8 million approximately.
However, health insurance companies have told the Department of Health that for every increase of 10 per cent in the bed charges, premium levels would rise by up to 3.3 per cent. Such increases would be in addition to those generated by regular cost pressures.
At present, the Government charges insurance companies €910 per day for a private bed in a HSE regional or voluntary teaching hospital, in addition to the €75 daily statutory in-patient charge.
Under the model in the report the new weighted average cost of a bed-day in a regional or teaching hospital would be €1,122 per day.
Government sources said last night it was not certain the interim proposals would be implemented. They said a more fundamental examination of how hospitals are paid for private facilities was being undertaken. This would assess if there were more appropriate ways of charging that would fit with the Government’s goals, such as encouraging more day case work.
One option that could be looked at by the Government would be to charge insurance companies on a procedure basis rather than per night in hospital.
The interim report of the group on value-for-money and policy options on the economic cost of private facilities in public hospitals proposes significant changes in the way this is calculated.
For many years it has been Government policy to move towards charging insurance companies the full economic cost of the provision of private facilities for their subscribers in public hospitals.
The report says that after several large hikes, insurers pay about 97 per cent of the actual cost for private beds in HSE regional and voluntary teaching hospitals.
Up to now the Government has based its estimates for the economic cost of a private patient in a public hospital on the average cost per bed-day in each of the various categories of hospitals.
The report urges that pension spending and the cost of very expensive treatments for small numbers of patients, with a new capital depreciation charge, should be included in the assessment of the economic cost. One option open to Government would be to set private bed charges at the level of the new average cost as calculated in the newly developed model.