In the past year, 56,000 people have joined VHI and the introduction of a range of five new healthcare plans yesterday should keep that momentum of growth, according to the acting chief executive, Mr Aidan Walsh.
The new "Option Plans", a range of benefits for people looking for increased health insurance, includes full cover for heart surgery procedures for those on lower health insurance plans, enhanced maternity benefits, increased cover for GP visits and out-patient visits with consultants, the introduction for the first time of student rates, and an extension of overseas cover.
"VHI is winning new members at a rate of over 1,000 a week and this exceptionally high level of new membership has been maintained for almost two years. A membership base of 1.43 million provides us with an unrivalled platform from which further expansion can be initiated," said Mr Walsh.
But competitor, BUPA, says its "price advantage" has now widened considerably. The company said that its Essential Plus Scheme at £215 per annum (group rate) is now £75 less expensive than VHI's Plan B Option at £289. A student with BUPA, said a spokeswoman, is charged at £75 compared to the VHI Plan B Option of £121.
"While the new products bring VHI closer to BUPA Ireland's range of benefits they increase the VHI's price premium to 37 per cent compared to our premium. We believe Irish consumers will look closely at what they are paying for in their health insurance," said the BUPA spokeswoman. The company now has 30,000 members and company sources say that it has beaten targets set.
Following its recent 9 per cent premium increase, VHI prices, particularly in the Plan B market, are higher than those charged by BUPA. However, subscribers to BUPA's Essential Plus scheme have to pay an excess of £50 each time they are hospitalised. Yesterday, Mr Walsh said the new products were introduced following detailed research of members needs and not in response to competition from BUPA.
Mr Walsh said VHI has "a wider range of benefits, better outpatient cover and more hospitals and more doctors". The company has been working on the development of new products for a number of years, he said.
He said the premium increase for the "Option Plans" was very small. "People regard £260 a year for Plan B as excellent value for money," he said. "It is the lowest cost for private medical insurance in Europe and perhaps in the developed world," he said.
About 60 per cent of VHI customers are in group schemes and Mr Walsh said yesterday that they had only lost four "small" group schemes to BUPA.
Asked about the future of VHI, Mr Walsh said that a strategic alliance was being considered. "We are having discussions with the Department of Health in relation what the options might be."
He said there had "not been detailed discussions with third parties in relation to specific plans". VHI was interested in a strategic partner which has under-writing and marketing skills for its noncore products - long term-care, critical illness cover and dental.
"A number of people have approached us, including Irish and foreign interests, about what they would like to do in co-ordination with VHI."
VHI, he said, is well placed to record another small surplus in its accounts for the current year. Mr Walsh, who is acting chief executive, is due to complete his term at the end of the year. VHI chairman, Mr Derry Hussey, and a sub-committee of the board are currently seeking a new chief executive. Approaches have been made to a small number of candidates.
Last night, the Irish Medical Organisation said the VHI had not gone far enough in improving out-patient cover. "We are a little bit disappointed that the VHI did not address some fundamental issues in relation to out-patient cover. They seem to have simply tinkered with reimbursements and GP and consultant visits," said Mr Conal Devine, the IMO's industrial relations director.