There has been no undue delay on the part of the Voluntary Health Insurance Board in its discussions with private hospitals on new contractual arrangements. VHI hospital agreements expired on 31 December 1991 and the board was fully prepared to effect new agreements in advance of 1 January 1992. It must be appreciated that these discussions addressed many complex issues including costs, complexity of services and new technology and, in most cases, hospitals asked for more time. The board agreed to this request, continued to pay accounts at current rates and undertook to backdate agreements to 1 January.
Individual agreements had to be reached and have now been concluded with the vast majority of private hospitals. I am satisfied that the negotiations did not affect the viability of hospitals and that the information requested by the Voluntary Health Insurance Board was necessary before reaching agreement. It will be understood that the board as an insurance underwriter must be in a position to satisfy itself as to the reasonableness of cost presented to it and ensure that VHI remains affordable to its 1.2 million insured.
The agreements provide for VHI reimbursement to hospitals for their legitimate costs, plus an overall marginal 3 per cent of turnover to allow for some development.
