Michael Ferris
Question:49 Mr. Ferris asked the Minister for Health and Children if he will implement a risk equalisation scheme in the health insurance market. [15923/97]
Written Answers. - Risk Equalisation Scheme.
The Health Insurance Act 1994 was enacted on 30 June 1994 in the context of our obligation to open the market in private medical insurance to competition under the EU's Third Non-Life Insurance Directive. The Act made provision, inter alia, for the Minister for Health to prescribe a scheme of risk equalisation. Such a scheme was prescribed by means of Statutory Instrument No. 84 of 1996, Health Insurance Act 1994 (Risk Equalisation Scheme), 1996, made on 28 March 1996.
The scheme provides for the establishment of a risk equalisation fund into which insurers with a risk profile better than the market average will be required to make payments, and from which payments will be made to insurers with a worse risk profile than the market average. The regulations provide that the risk equalisation scheme will not become operational unless, and until, the conditions in the market require it.
My predecessor initiated a review of the risk equalisation scheme by an independent advisory group. The group, which commenced its work last July, was requested to report to the Minister within six months. When the group's report is to hand, I will consider whether any amendments to the existing risk equalisation scheme would be desirable.