Health Insurance (Amendment) Bill 2012: Report and Final Stages

I move amendment No. 1:

In page 4, between lines 6 and 7, to insert the following:

“(b) the necessity of ensuring, in the interests of societal and intergenerational solidarity, that the more healthy, including the young access health insurance cover so as to ensure that the health insurance market is made up of a sufficient mix of the more healthy, including the young and the less healthy, including the old,”.

This amendment is on foot of the discussion on Committee Stage about the difficulties the insurance market is facing and my concern that if we are to develop the notion of intergenerational solidarity, community rating and risk equalisation, the need to get young people into the health insurance market is of critical importance. That is the reason I put down this amendment. It is because of the necessity to ensure, in the interests of societal and intergenerational solidarity, that the more healthy, including the young, access health insurance cover and that the health insurance market is made up of a sufficient mix of the more healthy, including the young, and the less healthy, including the old.

The purpose of this amendment is to ensure we have a sustainable health insurance market in the next number of years. The Minister has committed himself to bringing about universal health insurance. We can have a debate about that another day but in the meantime, even if we move towards universal health insurance, it is critically important that we have vibrancy and sustainability in the health insurance market. That means we must have an approach whereby young people see it as beneficial and there is merit in taking out private health insurance with a health insurer. Otherwise, we will have a situation, as is currently the case, in which people are reducing their cover and even reducing the number of people insured in their families. We now have cases in which the father in a family has given up health insurance because he cannot afford it.

I do not expect the Minister to resolve the difficulties families are under in terms of funding private health insurance but, at the same time, it is within his remit at least to try to curtail rising health inflation and to ensure also that we have an attractive health insurance market that gives people some reward for taking out private health insurance. If we do not do that we will not have a sustainable intergenerational support base for young people to assist in community rating and cross-subsidisation in terms of those who are older and drawing on health insurance. That is the reason behind this amendment. I tabled it knowing the Minister would reject it, but I wanted to stimulate some debate between now and the time when universal health insurance is established, so that in the meantime we can have a sustainable, vibrant insurance market in which there is cross-subsidisation, risk equalisation, community rating and intergenerational solidarity.

I support Deputy Kelleher's amendment. He has made a valid argument, which we raised with the Minister on Committee Stage, regarding the challenges we face. The reality is that unless we can encourage young people to go into the health insurance market we will continue to see the haemorrhaging of individuals and families out of the system. It is estimated that by the end of this year approximately 200,000 people will have left the health insurance system since 2008. Something must be done to incentivise people to take up health insurance and encourage others to join up for the first time.

The difficulty is that the Health Insurance Authority has said that is a pointless exercise at this stage in that universal health insurance will be introduced in four years' time and therefore it will not make a huge difference. The reality is that it will take a period of time to implement universal health insurance in its totality. It will not happen in four years' time. Hopefully, it will commence at that stage, but it will take a period of time to roll out. There was a contribution by the health insurers at the Oireachtas committee recently and, according to their evidence, it will take ten years to implement universal health insurance. If we are talking about up to 14 years for the full implementation of universal health insurance, many people will have leaked out of the system in the intervening period. Some type of incentive must be built in.

The argument is being made by the Health Insurance Authority that once universal health insurance comes in everyone will be legally obliged to sign up to health insurance and therefore we will not have to try to incentivise it. The difficulty is that we must try to get new people into the system now if we are to make the health insurance system sustainable in the short term. The argument I made to the Minister on Committee Stage was that some sort of incentive must be put in place, and not just for young people coming into the health insurance market. Why should someone who has continuously paid his or her VHI subscription year in, year out for the past 40 or 50 years have to pay the same amount for the same benefits as someone of the same age who is signing up for the first time?

In the past, when the Minister articulated the view on universal health insurance, he said there would be an incentive for insurers to improve the quality of health of the cohort of people they have insured. They would encourage people to give up smoking, lose weight and so forth, but how do we encourage that? Some incentive must be given to the individual for them to lose weight or give up the cigarettes and if that is not built into the price of the policy some other added bonus must be offered. I have suggested to the Minister that whatever carrot, so to speak, is looked at under universal health insurance, it should also be offered to people currently in the health insurance system in advance of the introduction of universal health insurance here. It is a fair proposal that is being put forward because incentives will be built into the universal health insurance system. Regardless of what they are, they will be decided by the insurers in many cases. Surely we can make some provision, as part of the roll-out of universal health insurance, that people already in the system get some additional benefit on foot of others coming into the new system in the future.

I support my colleague's amendment to this legislation. It is difficult not to be repetitive considering that the two previous speakers valiantly pleaded for this amendment to be accepted. It is clear that health insurers are having difficulties not just in trying to get the intergenerational mix about which my colleague, Deputy Kelleher, has spoken but also to retain the existing participants in the scheme. I see that as a major challenge, knowing many people who have had no choice, because of the decisions taken by this Government, but to cease payment in the private health insurance market. Some of those are more likely to be young, healthy individuals who by their nature are taking a gamble now in the hope that they will not need insurance in the future.

This creates a serious strain on the health insurance sector. I appeal to the Minister to examine the sector, not in the context of moving towards the schemes he has in mind to force people to take out health insurance but to try to assist them in the current climate. I do not have the answers for him, but he is in contact with the sector. Whatever incentive is needed to encourage people in order that they see the immediate benefits needs to be provided. The insurance sector will be put under phenomenal pressure at a time when it can least take it.

Deputy Billy Kelleher who tabled the amendment does not expect the Minister to accept it, but perhaps it might act as a catalyst within the mind of the Minister and his departmental policymakers to see the potential to address what is a phenomenal crisis. We hear statistics trotted out by the health insurance industry for the numbers of lost participants. I see this in my extended family and the constituency I represent. People are feeling the bite and cannot continue to make such a commitment. They are feeding their children, rather than covering the potential risk of illness. It is hard to blame them and unless we do something about it, we are pushing the bubble along a tube and, ultimately, it will burst. I appeal to the Minister to come forward with a methodology to find a way to solve the problem.

The Health Insurance Act regulates how private health insurance is provided for those who choose to purchase it. Currently, the figure amounts to 46% of the population. This has always been a remarkable feature of our system, given that, in theory, everyone is entitled to free hospital care. Over a period covering several Governments people lost faith in the ability of the public service to deliver. Deputy Timmy Dooley is correct in that we must maintain the health insurance market while we move to a universal health insurance system. He was reasonable in his comments, but, needless to say, he slipped in a comment about the decisions of the Government. Nonetheless, I am sure he accepts that it is economic circumstances that determines whether people can afford to take out insurance. Without being overly partisan, he shares responsibility in that regard.

I will and hope the clinicians do also.

I agree with Deputy Billy Kelleher in the sentiments he expressed. Young people are not being discouraged from entering the market. I hope the Deputy joins me in calling on insurers to provide student cover until the age of 23 years, as provided for in legislation. The insurers can do so if they want, but they have chosen not to do so. They are free to offer products and set prices at whatever level they like, subject only to compliance with certain minimum benefits outlined in regulations made under the Health Insurance Acts. My role is to ensure individuals who choose to purchase such products are protected from discrimination.

Deputy Denis Naughten made an interesting point about smoking. We want to see the Bill passed as quickly as possible because it will have an impact on the market early in the new year. However, we will refine and re-examine it as we go along and I can see a way by which we can take on board the concerns of the Deputy such that a smoker can be loaded as long as he or she is not penalised because of his or her age. The loading should be the same for smokers of all ages because we believe in community rating and do not want a difference to emerge, as that would make obesity, for example, more difficult to deal with. The issue of cigarette smoking could be examined and I will be happy to do so. There will be ample opportunity to revisit the matter because the matter will come before the Dáil on an annual basis.

The best way to ensure health insurance will be affordable for everyone is to reduce costs. This must be done. I have issued clear riding instructions to the new CEO and chairman of VHI that I expect to see the costs issue tackled. I expect to see a more robust audit and, for the first time, there will be a clinical audit in order that clinicians will be challenged on whether the carrying out of tests was necessary. Fines will ensue.

We can also cease paying by the day and pay by procedure. Private and public hospitals that are efficient in getting in patients on the day of a procedure and home quickly, with low readmission rates, will thrive. I also want to have a full examination of what we are paying for all procedures. Certain procedures used to take two hours but now take 20 minutes. However, we still pay the same remuneration rates. This issue must be addressed.

One of the main purposes of the Bill is to enhance intergenerational solidarity and solidarity between the healthy and the less healthy. This is reflected in my amendment to the Bill which broadens the scope of the cost subsidy to include more of the healthy, generally the young, and the less healthy who are generally older. Another issue we are discussing is that of lifetime community rating which could be introduced to allow insurers to charge people over the age of 30 years taking out health insurance for the first time a loading based on the age at which they take out private health insurance. These are issues I am happy to examine and take suggestions on, but, in the interests of getting the Bill through as expeditiously as possible, I will not accept the amendment. As Deputy Billy Kelleher pointed out, he expected this to be the case. I thank him for raising the issue because it is an important one. We are examining different ways to make health insurance more attractive and affordable for younger people.

I have been around the House long enough to know that, even if I had impressed on the Minister the need to accept the amendment through the force of argument, it would not have happened. The Minister has said insurance companies can offer packages to young people and the question is why are they not doing so. If they are to sustain a business model, there must be a number of young, healthy people to cross-subsidise. That is a basic principle. The VHI meets more than 80% of the cost and covers only 54% of people. This is another indication that if other insurers do not encourage young people to take out private health insurance, they will be in the same difficulty as the age profile of their clients moves upwards. Other companies will come in and cherry-pick younger people such that there will not be a continual creeping upwards of the age profile of clients. New clients are needed to cross-subsidise others and support intergenerational solidarity. We understand families are under pressure and that there is a need to drive down the cost of medical insurance and the fees charged by health care providers. We also appreciate that the Minister is carrying out an in-depth analysis of the health insurance sector, encouraging clinical audits and encouraging companies to tighten up on costs. However, the principle we are trying to invoke is that there should be positive engagement on policy between the Government, the Department and health insurers to encourage uptake of health insurance.

The other reason for the decline in the number of young people taking private health cover is that they are unsure of what universal health insurance means. The Minister says he has a target of providing universal health insurance by 2016. In the meantime, people will ask why they should take out private health cover other than to ensure it will be there for them if they get sick. What other benefit does it give? Does having cover allow a person to build up loyalty with an insurance company? People take out private health insurance for a number of reasons, but they do so primarily because they expect a loyalty bonus if they remain with a particular insurance provider.

I ask the Minister to look on this amendment favourably, even at this late hour. I accept that he cannot accept the amendment but can he give a commitment, at policy level, to ensure that young people see health insurance as beneficial until we move to mandatory health insurance?

I take on board what the Deputy is saying. Insurers are locked in competition for younger customers because that is where they make their greatest profit. For that reason, they will not cut prices too much. We want to encourage them to reduce their costs so that they are in a position to cut their prices.

We have already undertaken to discuss lifetime community rating with insurers. People take out insurance for the cover. In my experience, they also take it out because they want to have a one-to-one relationship with the treating consultant, which they sometimes feel they do not get in the public health service. That is something we are in the process of changing by having more consultants in hospitals. The new Labour Relations Commission agreement is about ensuring there are more consultants and senior decision makers around at all times.

I hope that clarifies matters for the Deputy. I am afraid I will not be accepting the amendment.

There is no point in my saying much more. Other Members want to discuss their amendments.

I cannot accept the Minister's argument although I know it is put in good faith. We need to have something in policy that supports the concept of intergenerational solidarity. My amendment would achieve that.

Amendment put and declared lost.

I move amendment No. 2:

In page 4, line 35, to delete “old.”,” and substitute the following:

“old,

(e) the imperative to ensure that all persons receive, in due time and to the highest standard possible, health services on the basis of need alone and not on the basis of ability to pay.”,”.

As I stated on Committee Stage, the Government's reform strategy is flawed because it is based on competing private health insurance companies and will represent the effective privatisation of the health services. The Minister's strategy has no basis in rights as it contains no commitment that patients will be guaranteed in law that they will receive basic essential health care. That is a core principle of mine. One of the core positions of Sinn Féin is a commitment to universal entitlement to health services on the basis of need, and need alone. Instead, the Government's strategy relies totally on regulation of the insurance industry, mainly through the legislation before us.

The purpose of my amendment is to set down a marker for citizens and to enshrine a commitment in law. Insurance companies must be made aware that there is an imperative for the State to ensure that all persons receive health services in due time, to the highest standard possible and on the basis of need alone and not on the basis of their ability to pay or the size of their bank balance.

Sinn Féin sees the amendment as a first step and would build on it, introducing separate rights based legislation and a rights basis for health care. That is necessary and, arguably, needed now more than ever, given the Government's approach to an insurance based model.

In the absence of the principle recognised in our amendment and its reinforcement in rights based legislation, which Sinn Féin is committed to, private insurance companies would be given too great a role in determining the level of basic health care services available to citizens. That is where we are going. Private insurance providers would have a critical role in determining the level of basic health care for each citizen.

The Fianna Fáil regime of 14 years' duration promised to introduce an eligibility for health and personal social services Bill. The Minister and I, as Opposition spokespeople on health, repeatedly requested advice on the progress of the Bill. Of course, it never saw the light of day. The Bill would have been hugely important. It would have placed the citizen's right to access health and personal social services in law. The Bill did not see the light of day under the former regime and there is no indication that it will re-present under the Minister's stewardship.

I refer again to a report recently published by the IMPACT trade union. The report had not been prior-studied when we debated the Bill in the select committee. I made reference to the report on that occasion but I do not think the Minister had access to the detail of it. The report was an analysis of the Government's proposed reforms and concluded that the Government has based its approach to universal health insurance on policy in the Netherlands, which the Minister repeated in his reply to me on Committee Stage. In that country, a system of competing private insurers has created an inequitable and inefficient system of funding with different tiers of entitlement. That is hugely worrying because this is the system the Minister and his Cabinet colleagues have lauded repeatedly. The idea of different tiers of entitlement is what we are, supposedly, trying to avoid and get away from when we commit to universal access to health care on the basis of need, and need alone. Why and how can there be different tiers of entitlement?

I appeal to the Minister, as I did previously, to consider the amendment.

It does not change the broad thrust of the legislation or the intent behind it, as the Minister has explained. I believe it is worthwhile and that it serves a particular purpose. It would have to be followed by rights-based legislation and that should follow at the earliest possible opportunity. I urge the Minister to accept the amendment and appeal to him to so do.

Sadly, Deputy Ó Caoláin has misconstrued the situation, which is a recurring problem. This universal health insurance, as outlined and committed to in the programme for Government, is not based on private insurance. The programme for Government is very clear the VHI will be retained. It is a State-owned insurer and it is to be retained as a public option. Furthermore, the assertion that these competing insurers would dictate the basic health care standard is again wrong. The Health Insurance Authority will determine the level of basic health care. It will determine the standard policy that must be available to all citizens.

The Deputy alluded to the IMPACT study. Our system will be based on a multi-payer model and will be underpinned by the principle of social solidarity, as I have said. Indeed, the Deputy quoted me as saying treatment would be based on medical need and not the ability to pay. Under UHI everyone will be insured for a standard package of curative services. A new insurance fund will subsidise or pay insurance premia for those who qualify for a full payment or a subsidy.

The IMPACT report appears to assume the Government plans to implement the Dutch model in full. This is not the case. I have made it clear on numerous occasions that what we liked about the Dutch model was the multi-payer system, but we are not importing the Dutch model into Ireland. I doubt it would work in its fullness. We looked to Britain for hospital trusts, which we find to be a suitable model from the point of view of new hospital groups, and which we will bring in next year. A report on that is to hand and is being analysed by my Department as we speak. We looked to the North of Ireland, where the special delivery unit had such success before there was a change of Minister and a change of focus. We have brought that to bear here with considerable success, if I can remind the Chamber of the 25% reduction in the number of people who must endure long trolley waits, the number of people who await inpatient treatment for a year, nine months or, indeed, three months, and that the number of children awaiting inpatient treatment has fallen by 800. The 91% reduction in those waiting nine months or longer is, to my mind, considerable progress against a backdrop of reduced budgets and staff numbers. We are also looking to Denmark and Canada for patient safety.

We are not looking at any one model. We are looking at all models and we taking from each one of them what we feel is the best solution for our country in the 21st century. We are completely reforming the health service and that cannot be done overnight. It is akin to turning a huge tanker at sea. We must maintain it while we are reforming it and we have had many people bemoaning the fact that is dangerous because it involves so much change. There is no other way to do this, however, because piecemeal change in the past has not delivered and we intend to deliver. As I have said before, quoting John Donne, no man is an island, entire of itself, and no part of the health service is an island unto itself either. The emergency department problems cannot be fixed without fixing the hospital's problems, without fixing long-term care problems in the community, and without addressing primary care issues in the community. All these things are being tackled, along with the insurance industry, which has been reformed. I do not believe at any time in the history of this State there has been so much reform undertaken in the health service.

The IMPACT report argues for more analysis of a single payer model and cites Germany and France as examples of single payer models. These models both involve multiple insurance funds. The report fails to consider what would happen to the existing health insurers in Ireland, Aviva, Laya, Glo Health and the VHI, and the jobs they provide, if we introduce a single payer model. To be frank, having watched over recent years what the HSE, with a monolithic monopoly, has done to our health service, how it has robbed the front line of its ability to decide for itself what is best for the patient, I do not want to see a single payer model in this State. Competition is good. It is better for the end user, in this case the patient. If others wish to call him a client, so be it.

In essence, from a technical point of view, the principle objective of this Bill relates only to those who have chosen to avail of private health insurance cover. The issue of the basis on which access to services is available, that is, ability to pay or health needs, does not arise as that is covered by the State's current arrangements on accessibility to secondary care being free to all who reside within the State. Therefore, I do not accept the amendment.

The Minister set out to attempt to rubbish the point that the so-called reform strategy and what the Minister envisages in terms of universal health insurance as the basis of the delivery of same into the future is based on competing private health insurance companies, yet he concludes by lauding and applauding that very approach. His conclusion is so contradictory from what he said at the outset that it does not stand up. The Minister cannot have it both ways.

I indicated on Committee Stage that we are both committed to universal access on the basis of need. This, however, is not the basis on which to guarantee that. There are no guarantees. The model on which the Minister is basing so much of his intent, and which I must say from the very outset was referred to consistently by the Minister and others, is the model operated in the Netherlands, and that has been shown on more careful scrutiny to be anything but what it purports to be or, perhaps, what it set out to be.

There is serious concern and a lack of confidence about the approach. The Minister has still failed to produce a White Paper. We have no outline of a plan, although we have the Minister's continued and repeated statements that he is examining this and examining that. He is looking everywhere but he is not coming forward with the outline of how this will unfold, and that is the detail people want.

When I made the point about private insurance companies being given too great a role - not the determination of it in total, but too great a role - and I believe that is what they will have, in determining the level of basic health care services available to citizens, the Minister responded that the Health Insurance Authority would determine that.

With all respect the Health Insurance Authority is a quango of little proven worth. That was emphasised and underlined by its representatives' recent appearance before the Oireachtas Joint Committee on Health and Children.

I will deal with the last point. I would not have been greatly impressed with the role the HIA had in the past. It is intended to beef it up considerably so it can act as a regulator. One is nearly afraid to use the word "regulator" in this country, having seen all the failures of regulation in the past.

However, it will be independent and will protect the consumer, define the standard policy to be available and monitor very closely any products created by the insurance companies to ensure there is no attempt at cherry-picking and segmenting in the market. By that I mean trying to encourage younger people into certain products and to discourage older people. I would be the first to accept that we need to beef it up.

I emphasise there will be competing insurers, with at least one public in the new arrangements. Ultimately the amendment has no relevance to the Bill, which relates to the current market and to those who chose to have private health insurance. It does not relate to the future universal health insurance system that we plan. The paper on universal health insurance will be available later this month as promised. As the amendment is not relevant to the Bill I decline to accept it.

As I have another amendment and as Deputy Naughten is also waiting to move amendment No. 4, I will not make any further contribution.

Question, "That the word proposed to be deleted stand", put and declared carried.
Amendment declared lost.

I move amendment No. 3:

In page 6, to delete lines 12 to 14.

It is quite obvious that this will suffer the same fate as my previous amendment. As I explained on Committee Stage, the effect of section 4 as it stands would be to remove the requirement to lay regulations before the Houses of the Oireachtas in draft form. I have explained that by reference back to the principal Act of 1994, which provides that a draft of the regulation shall be laid before each House of the Oireachtas and the regulation shall not be made until a resolution approving of the draft has been passed by each such House. I believe that is a very important provision and is as it should be.

As I recall, in his reply on Committee Stage, the Minister said that another provision, as yet not before us, would eliminate or make redundant such a requirement. I have no doubt he will explain this again in a moment. Regardless of what is to present, at this point that requirement exists. I believe it should remain unless and until a better methodology is presented and no such is offering in this Bill. We are simply being asked to remove a requirement for both Houses of the Oireachtas to have sight of the draft regulations. That should stand and Members of this House should be prepared to argue for and defend it. It is clearly not only in the interest of the Members of these Houses, bearing in mind our role and responsibility, but also in the wider public interest that the earliest scrutiny should take effect. I commend the amendment to the Minister.

I thank the Deputy and while I share the sentiment, as I explained on Committee State, the previous risk equalisation scheme in 2003 was mainly set out in regulations. The new scheme, including rates for risk equalisation credits and stamp duty levies, is strengthened in future by being set in primary legislation. The Houses will have ample opportunity to discuss amendments now and in the future. To put it another way, the Bill puts all these things that were in regulations into primary legislation, which makes them much more robust. They cannot be challenged in the courts in the way that regulations can be. As I will not be making regulations to provide for a risk equalisation scheme in the future, these subsections are no longer valid.

As I explained in my Second Stage contribution, I will make regulations to deal with the administration of the scheme, rather than the scheme itself, as provided for in the Bill. The regulations, which will not be introduced until the Bill is passed, under section 11F will include, for example, the making and determination of claims. The other set of regulations to be made by the Health Insurance Authority under section 11E will allow for the categorisation of products.

I am disappointed the Minister has not accepted the amendment. I am sure he understands why I focused on the matter and why I believe it to be important. I am not entirely convinced by the explanation he has given that this is no longer a requirement and a protection. There lies the difference between us on this matter, as with so many other matters. I will not prolong my contribution.

Question, "That the word proposed to be deleted stand", put and declared carried.
Amendment declared lost.

I move amendment No. 4:

In page 11, between lines 20 and 21, to insert the following:

“9.—Section 7A of the Principal Act is amended—

(a) in subsection (6), by deleting “may by regulation” and substituting “shall introduce by 1 January 2014 regulations which shall”, and

(b) in subsection (7), by deleting “Regulations under subsection (6) may” and substituting “Regulations under subsection (6) shall, inter alia,”.”.

This relates to an amendment I tabled on Committee Stage and tries to incentivise the provisions in the 2001 Act following the introduction of universal health insurance where we will have lifetime community rating implemented as per the provisions in 2001. I put forward an amendment as an alternative option. It comes back to the argument we had on amendment No. 1. Health insurers no longer announce premium increases on an annual basis, but perhaps three or four times a year. The concern is that premium inflation will continue. At the moment an adult will pay a health insurance levy of approximately €285 and a child pays approximately €95. That will increase significantly on foot of the legislation before us. At the same time nearly 200,000 people have left the health insurance market. The reality is that the best way to protect the community-rated system is to ensure that more young people come into the system.

However, the opposite is happening because with the increase in the cost of private health insurance, young people and young families are leaving the system. We have a bizarre situation where the numbers of older people within the system are increasing. If we look at a comparison between 2009 and 2010, the number of people over the age of 65 has increased from 40.9% to 43.4%. In real terms, between 2009 and 2011, an extra 5,500 people over the age of 80 joined the health insurance system. The number of people aged between 70 and 79 in the system has increased by 9,500, while the number of people aged between 60 and 69 in the system has increased by 5,000. Older people are joining health insurance later in life, while younger people are leaving the system. If this trend continues, the only people who will be able to afford health insurance in this country will be the wealthy or people who have no other choice but to remain in the system in order to access vital health care. I have huge concerns that the trend will undermine the principle of universal health insurance, in which most of us in this House believe.

I tabled an amendment to get around the logjam of lifetime community rating on Committee Stage. I have tabled a different amendment here on Report Stage but it is based on the same principle and would encourage the Minister to sign the 2001 regulation, implement lifetime community rating and introduce some type of incentive or give an indication that there will be an incentive built into the new universal health insurance system for people within the health system whenever that happens. The Minister sees where I am coming from in respect of this and acknowledged that in his original contribution this evening. What is crucially important is that we have a timeline in respect of that. I hope that when he responds to me he can give a timeline for the implementation of lifetime community rating. Based on the evidence we have received from the health insurers and the HIA, the only mechanism that is not being used to reduce the cost of health insurance is lifetime community rating. This could have an impact on the rate of increase of health insurance costs and hopefully see a curtailment of them. This could then be followed by a reduction in the rate of health insurance costs and could encourage even more people into the system. This would then take pressure off the community rated system and allow for the implementation of universal health insurance, a principle with which we all agree in this House.

Deputy Naughten's amendment aims to encourage people to stay or become involved in health insurance and make sure they will go into universal health insurance. The key point there is that universal health insurance will be mandatory so there is no need for incentives to get people into universal health insurance. It will be the law and we have a mandate from the people to do that. It is in our programme for Government and our electoral programme.

The White Paper on universal health insurance, which will be published next year as opposed to the paper which is coming out in a couple of weeks, will outline the details of the universal health insurance model in addition to the estimated costs and financing mechanisms associated with the introduction of universal health insurance. There are many key decisions that require careful planning and sequencing over the coming years and primary legislation, which will be required to underpin universal health insurance, will be developed in the future as part of that process.

The health insurance (risk equalisation) Bill provides for the introduction of a permanent scheme of risk equalisation. Therefore, I do not consider it appropriate to insert an amendment in the current Bill which would have the effect of compelling me to introduce lifetime community rating. However, as I have said, I am disposed to consider any measures that may assist with ensuring the maintenance of a healthy and functioning private health insurance market and will request my officials to further consider the implications of introducing lifetime community rating at this time under the existing health insurance legislation as part of the measures to ensure the sustainability of the private health insurance market in the transition to a universal health insurance system.

I am aware of the concerns of the Deputies and consumers alike about the cost of health insurance and I have outlined some of the areas which I want to tackle next. In fairness to the VHI, I must advise the House that last week, the VHI reported that its cost containment programme has delivered savings of €200 million since 2009 by applying various cost containment measures including reducing consultants' fees by 15% and reducing the prices paid for various procedures by between 13% and 53%. For example, the professional fee for the insertion of an ordinary stent has gone down from €1,100 to €200 and the cost of an MRI scan has been reduced from €650 to €160. However, I have informed the committee that I came across a patient for whom an MRI scan cost €8,000 because he was kept in hospital awaiting it. That is the difficulty of the current situation where we pay by the day instead of per procedure. Paying per procedure would definitely clear out that element.

The VHI has also introduced a payment system for radiologists and pathologists based on the national quality benchmarks which will lead to reduced length of stay and has the potential to save another €42 million for the VHI. It has also focused on claims recovery through the work of its special investigation unit. This is the audit I spoke about - a much more robust audit will be required. The VHI continues to focus on the issues and the findings of an external review of its claims entitled the Millman review.

The challenge for all of us must be to ensure that the health market remains viable and relevant, in particular given its role in supporting the provision of services in the public sector but also as we prepare for the transition to universal health insurance. Our public health sector has led the way in some aspects of this through the activities of the clinical care programmes, which have been far more efficient in recent times. Indeed, the VHI and some of the private hospitals are engaging with the clinical care programmes to make sure that sort of work ethic and protocols are put in place in their own hospitals.

I hope to have the interim paper from the implementation group on universal health insurance by 18 or 19 December 2012. I will not accept Deputy Naughten's amendment. I hope he will understand the reason but I am committed to further examining with my officials the issue of lifetime community rating.

I thank the Minister for his response. I accept that there is no need for an incentive to get people into universal health insurance. Under the Dutch system, 90% of people were already in a voluntary health insurance system before they introduced universal health insurance in that jurisdiction. If trends continue we could be down to less than 40% of the population with private health insurance in advance of universal health insurance coming in. It makes it far more difficult when one must fund that big a differential compared to what was the situation in the Netherlands. That is why I am saying it is important that we try to keep people within the present voluntary health insurance system and encourage new people to come in. I and everyone involved in the industry believe that lifetime community rating is a mechanism to do that. The difficulty is that it has taken 11 years for the Department to look at this situation, yet no decision has been made. That is why I am asking for a timeline in respect of it.

We all agree with the point the Minister made about moving from a situation where one pays by the day to paying by procedure. The difficulty, as the Minister knows, is that this legislation provides for the opposite. One pays by the length of time one is in the hospital bed. It is a weakness within the legislation that there is no sunset clause built into that provision so that it can be removed from the legislation within the next 12 months.

The lack of such a clause will undermine the principle of where we all want to go. This amendment to the legislation is required.

I reassure Deputy Naughten there is no need for a sunset clause because the provision exists for me to close this by setting the daily rate at nil.

As it is now 10 p.m., I am required to put the following question in accordance with an order of the Dáil of this day: "That the amendments set down by the Minister for Health and not disposed of are hereby made to the Bill, Fourth Stage is hereby completed and the Bill is hereby passed."

With the Leas-Cheann Comhairle's permission, I wish to provide the House with some information. On Committee Stage I gave the details of the risk equalisation credits but it would be remiss of me if I did not inform the House, as I informed the insurers, of the new stamp duty rates. I have sent them to the Minister for Finance and he has agreed with my recommendations which, in a forthcoming Finance Bill, will be proposed to come into effect on 31 March 2013. The existing rates of €95 for a child and €285 for an adult will apply until that date. For those aged 17 and under there will be a new rate for non-advanced cover of €100 and advanced cover of €120. For those aged 18 years and over the non-advanced cover rate will be €290 and the advanced cover rate will be €350.

Question put and agreed to.
The Dáil adjourned at 10.03 p.m. until 10.30 a.m. on Wednesday, 5 December 2012.