Health Insurance (Amendment) Bill 2014: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

As I noted yesterday, this legislation represents an updating of the regulatory regime for the health insurance sector in this State. Some of the Bill continues what I acknowledge, as the health delivery system currently is structured, is the necessary system of community rating, which helps to ensure that consumers are charged the same premium for a particular plan regardless of age, gender or health status, thus preventing price discrimination against those more likely to require medical treatment. Unfortunately, it is also but a way of propping up the ailing health system. Members still await details of the Government's long-promised universal health insurance proposals. In the interim, many people continue to take out private health insurance because they cannot rely on the health service when they or their loved ones are unwell and this, as I already have stated, in itself is a tragedy.

As long as the type of health insurance market and the type of health funding system that exist in this State are retained, the regulatory regime provided for in this Bill will be necessary. Accordingly, I record that Sinn Féin will not oppose the Bill's passage. It involves a complex system of risk equalisation to support the community rating principle. This entails the transfer of compensation from insurers who carry lighter risk burdens than those who carry heavier risk burdens. All this requires regulation, monitoring, enforcement and as provided for in this Bill.

In the absence of such legislation, the unregulated market would discriminate against the old, the sick or any other group or individual that insurance companies decide to be a greater risk. The legislation is, therefore, supposed to be a protection against the working out of the raw profit motive in the health insurance sector. It is supposed to be based on solidarity between generations and also between the healthy and the sick. That is welcome, in so far as it goes. However, as I have already stated on numerous occasions, Sinn Féin would go much further and would extend the principle of solidarity to the way we fund, organise, structure and manage our entire health care system. I will return to this point later.

Risk equalisation makes possible the scheme of community rating which ensures that all consumers are charged the same premium for a particular health insurance plan regardless, as I have already said, of age, gender or health status. The State continues to subsidise the private for-profit health system with private occupancy of public hospitals. Private health insurance still represents a fast track to care for private patients while public waiting lists grow and involves the dual working of hospital consultants in the public and private sectors. The background to private health insurance is laid out in the Health Insurance Acts 1994 to 2013. It includes such principles as intergenerational solidarity between all those covered by insurance.

The concept of risk equalisation is used in community-rated health to distribute the risk of insuring citizens with different risk profiles. A risk equalisation scheme has existed in the private health insurance market since 1 January 2013. Young, old, well and less well citizens are balanced to create premia that are more acceptable to all those choosing to take out private health insurance. In light of the system we currently have in place, this is a good thing. It is designed to stop market forces deciding to cherry-pick only healthy patients. Rampant capitalism does not have a place in health care in any circumstances. I am glad the Government recognises that. I am at a loss, however, to understand why it feels it appropriate to apply this rampant capitalism to its planned so-called universal health insurance plan.

The private health insurance model used by this and previous Governments allows for a hospital bed charge payable from the risk equalisation fund for each hospital visit involving an overnight stay. The main aim of this Bill is to outline the overall premium payable in respect of young adults and also to allow people to change insurers without being obliged to observe an initial waiting period. The Bill will also make changes to hospital bed credits and to the levels of stamp duty collected.

Section 2 makes provision for a sliding scale of health insurance premiums for young adults up to and including age 25 and will remove the requirement to be in full time education or to be dependent on the policyholder. The new subsection 5A to be inserted into the principal Act will mean that if offering young adult rates, health insurers shall offer the full range of rates within the specified bands. The regulations to provide for lifetime community rating will come into effect on 1 May 2015. After this date there will be late-entry loadings for those aged 35 and over who have not bought private health insurance up to this point. It will be a loading of 2% per year up to a maximum loading of 70% at age 69 and over. This is to encourage younger adults to take out insurance at a younger age than might otherwise have been considered.

Section 4 deals with those people who are to transfer from one policy to another and lays out that waiting periods need not apply in these cases. This is a common-sense approach. Section 6 and 7 revise credits payable from the risk equalisation fund and section 8 specifies the applicable stamp duty rates for the coming years.

Despite everything I have just stated, it seems that the Bill will not have the desired effect because most younger adults who do not have private health insurance are reported to have no intention of taking it out even if these measures are introduced. We have also seen that the HSE is directing hospitals to charge private health insurance patients as much as possible. We welcome the recouping of these costs but we also recognise that this will force more members of the public to turn to the public health system, which is currently ill-equipped to deal with any further increase in use of services.

This Bill arises out of a necessity to have social solidarity in the private health insurance sphere. Why not then extend social solidarity across the entire health care system? Unfortunately, it seems that Fine Gael and Labour are wedded to their flawed plan of providing universal health insurance at some unspecified point in the future. Theirs is a system that would see competing private insurance companies gobble up much of the overall health spend and those moneys spent on administration and advertising, with the balance hived off to satisfy the insatiable appetite of investors for profits and dividends. In the case of an insurance system based on competing private health insurance companies, which, as we see it, is the least desirable model, the profit motive and the interests of shareholders - rather than public health - become paramount.

We still need to know much more about the funding of universal health insurance. What is compulsory health insurance going to cost people who have neither medical cards nor private health insurance at present? We still do not know the answer to that question. Sinn Féin wants to see the development of universal public health care based on medical need and funded from fair and reformed general taxation. We note that recently the Irish Medical Organisation has expressed concerns about universal health insurance as a method of funding universal health care. I welcome the IMO's intervention. We are again calling for an open debate on this matter by means of which we can examine all options for health care reform and funding, not just the flawed proposal of the Fine Gael and Labour Government.

The Government is proposing to bring in universal health insurance with the State subsidising those who cannot afford to pay insurance premiums. The State will still have a huge regulatory, managerial and funding role. Why then bestow on private for-profit insurance companies such a central place in the system? What contribution will they make? These companies are funded by the consumers who buy their products. The insurance companies, on behalf of policyholders, will buy services from private or public hospitals or other service providers. They will be obliged to make substantial profits in the process. The Minister has already recognised the failure of the insurance companies to reduce their outgoings and to address their cost base. Why not cut out that profit for the privateers and keep the money involved within the health system or in the pockets of citizens?

When Fine Gael and Labour should have been aiming for a system of universal health care that would allow timely access to suitable care - free at the point of delivery for all citizens - they looked instead to universal health insurance as a solution for everything. In reality, it is merely a funding model and a deeply flawed one at that.

It is a model that has been widely criticised, including by the medical profession, and many examples that have been held up are both flawed and very hard to compare with an Irish context.

Sinn Féin is strongly opposed to the pro-business and for-profit slant of Fine Gael on health care. Universal health insurance represents a fillip for private health insurance companies and the for-profit health care companies. Similar models in the Netherlands have seen the quality and range of care continually reduced, with premia rising by up to 40%. Further, the majority of the population purchases additional insurance cover to make up the shortfall in the universal health insurance basket of cover.

Another important fact is that the Dutch had made a large investment in primary care prior to the introduction of universal health insurance. We, on the other hand, have under-resourced primary care for many years now. In the United States, the system of privatisation simply diverts badly needed funds away from front-line services towards administration and introduces the forces of the market economy, with "consumers" buying "products". The multi-payer model also requires much regulation, again taking the focus away from treating patients.

Sinn Féin has long held that an equitable system of health care must be based on a progressive funding model to ensure that those in poverty, or those who are most in need of health care services, can access a service of an acceptable level without having to pay hand over fist at every turn. Again, we do not know what the cost of the Government system will be for an average family. Can we really trust the Government that gave us Uisce Éireann to overhaul the health service? I think not. We have no idea as to the quality and kind of care that will be provided, or even when we will see this system.

We in Sinn Féin want universal health care, based on equal access for all and on the basis of need, and need alone. We want that to be State provided, funded from fair general taxation and free at the point of delivery. This would involve a higher contribution in tax from the highest earners than they contribute at present. We do not favour the model of insurance-based funding. However, if health insurance is to be the basis for funding, it should involve a State insurance scheme.

We simply cannot continue to have a two-tier system in which people die simply because they do not have private health insurance. I do not exaggerate. I recall again in this House the tragic case of Susie Long who passed away in 2007. She had been referred for a colonoscopy in 2005. She waited seven months for this test. She found out in 2007 that another patient who had been lucky enough to have insurance had been referred and diagnosed within days. That she lacked insurance contributed to her delayed diagnosis. It is a great shame that we have not moved very far on from this system. While we hope this could not occur again, we know those who rely on the public health system rely on a system that is creaking and groaning under massive strains, dealing with a larger and sicker population, and doing less with less.

It is appropriate to pay tribute to front-line service providers, including consultants, doctors, nurses and the various other specialists and support staff, particularly across the network of hospital sites. They are doing heroic work at a very difficult time within the health service and personally considering all the strains that have visited all our lives, our families’ lives and our communities over the years.

The deeply flawed two-tier system is reeling from the health cuts of the Government and its predecessor, yet it is being asked to deal with ever-increasing demand. The promised market-based private health insurance system is not the route to real and necessary reform of our health services. We demand an open discussion on the most progressive and equitable ways to fund a single-tier system, free at the point of care, that provides for all on the basis of need, and need alone. We ask the Government to accept that it has chosen a bad model. We ask for a fair system. That surely is not too much to ask of those currently in government who claim the mantle of James Connolly.

I dtosach na haicíde is fusa í a leigheas. Ba chóir dúinn éirí as an bplean seo sula gcuirtear blianta eile amú air.

Like its predecessor, this Bill is a necessary measure for the insurance sector as it stands. Overall, however, the future of health insurance and the entire health system generally under this Government needs re-examination or we will risk wasting further years before we have a system that we can rely on and of which we can all be proud.

The next speaking slot is shared by Deputies Richard Boyd Barrett, Finian McGrath and Michael Fitzmaurice.

On the face of it, this Bill is not one that one would oppose, and it seems like a reasonable attempt to deal with a problem. The problem, as the Minister knows, is that there is a crisis in the health insurance sector — I hate to use the word "market". I will state later why I hate to see the words "market" and "health" together in the one sentence. However, given that health insurance exists and that many people feel obliged to take it out, this legislation, on the face of it, is a reasonable attempt to deal with the fact that rising insurance premiums, combined with the impact of the recession, income cuts and the consequences of unemployment, have meant the number of people in a position to retain their health insurance has dropped pretty catastrophically over recent years. The percentage has dropped from over 50% to 44%, a big drop.

Anecdotally, we know people must question all the time whether they can maintain their health insurance or, as somebody told me yesterday, avail of it for six months, then drop it and take it out again when he can afford it. I refer to obtaining cover intermittently. There is a real problem in this regard. In so far as these measures are going some way towards making health insurance a little more affordable, obviously against a background of premiums rising very significantly, by an average of €100 per year over the past couple of years, the Bill seems to be an attempt to contain the dramatic increases in the cost of health insurance and the falling off in the take-up of health insurance cover.

However, it is worth saying that the Minister has said publicly he can give no guarantee these measures will actually contain the prices. He is quoted as having said the Bill will create an environment in which the health insurance industry can contain the increase in fees.

Ultimately, however, that decision will be taken by the private health insurance companies which is a matter of significant concern because those companies are out to make money. The private health insurers' primary interest is not to maintain affordability or, for that matter, to ensure that subscribers are covered, but to make money by whatever means is best. The Minister might say it is in their interest that greater numbers take out health insurance and therefore the insurers will want, where possible, to make premiums affordable, but the two do not necessarily go together. That is a matter of concern. The bottom line is it is left in the insurers' hands to determine whether insurance premiums are affordable.

On the face of it the Bill is a reasonable attempt to deal with a problem that we all are aware of, but to my mind this is like a sticking plaster on a gaping wound. It fits in with an approach to providing health care for the population that, ultimately, will not work and can result only in a two-tier health system which also is not particularly good value for money in terms of health expenditure generally, that is, the model of a health insurance market and of generally making a market of the delivery of health services. It just does not work. The problems we are seeing on a range of levels are merely the symptoms of a fundamentally flawed approach to health. The fundamental flaw is the idea that the private market is the appropriate vehicle to deliver universal health care for ordinary citizens and the crisis, in terms of the affordability of private health insurance, is one significant indicator of the unsustainable nature of that approach to health care.

The other side of this coin is the crisis in the public health service which is reaching dramatic proportions. For a number of years there has been a very severe crisis which has been dramatically worsened by the €3 billion of cuts in the public health service since the crash of 2008 and which has resulted in an incredible 10,000 staff being taken out of the health service, not to mention the closure of 2,000 beds across the country in the past couple of years and thousands more that have been taken out over the previous number of years.

Where all of this really stares us in the face is when we hear now on the radio as we drive home the proliferation of advertisements for the Mater Private, the Beacon clinic and the Blackrock Clinic. It is blasted at us, day in, day out, that for a price, if we have the money to take out the particular private health insurance package that is required to get into the Mater Private or wherever, we can deal with a crisis heart situation. If we have an accident and emergency matter, if we have the money, we will get it seen to in these places. With a dire situation in the public health service resulting from cuts, the pressure is on to do precisely that. Otherwise a person will wait a year, as 40,000 people do, for procedures or the person may die, as one young man did recently in Limerick. As was discussed earlier, a patient may die on a trolley waiting for care in the public health service. Certainly, a person could sit on a trolley waiting in the most unacceptable circumstances, as so many people do.

Some 6,977 patients waited on trolleys in October 2014, an increase of 63% on the number on trolleys in 2007. Those statistics indicate the disastrous situation we face. For those who might be tempted by the advertisements which imply they will not have to go into that nightmare which is the public health system if they can afford the premium packages of private health care, increasingly, for ordinary low and middle-income families, these are completely unaffordable and they are screwed if they do not have a lot of money. That is not an acceptable way to deliver health services which should be a basic human right in a civilised society.

Neither is it good value for money. Fine Gael often would pride itself on being the party that cares about the efficient use of resources. I point out to the Minister that in the United States, where there is one of the most privatised models of health care in the world, approximately 40% of all health spending is on administration, such as billing and all that is associated with a privatised model. It is spent not on the delivery of front-line health care, but on the making of profits for the private health sector. Is it not obvious that private companies will take a slice of the funding that should go into health services? That is what they are about. Inevitably, where there are private providers, in insurance or in services themselves, they will take a big slice for themselves and that is funding that should go into the health services. The alternative, as the Minister will be aware, is the National Health Service model, funded through progressive and fair taxation and delivering, not universal health insurance but universal health care, to all citizens at the point of need, and without which the Minister will be faced inevitably with the contradictions, crises and anomalies that he is trying to deal with in this Bill.

I thank the Leas-Cheann Comhairle for the opportunity to speak on the Health Insurance (Amendment) Bill. This is an important debate and I am glad the Minister, Deputy Varadkar, is in the House. It is important, when discussing this legislation that we not only analyse the Bill, but also put forward suggestions for reform.

For too long, this debate has gone on and it is time to deal with the real reform agenda, both in the area of health insurance and in the broader health service. Whether we like it or not, health will always be an important issue and it will always be on the political agenda. One can always judge a society by the way it treats its patients and runs a health service. We have seen in recent years the huge crisis in health insurance services.

Before I get into the details, I welcome the reforms of the medical card issued yesterday. I genuinely hope that these will work because we must ensure that sick and disabled children are guaranteed a medical card as a major priority.

We also must look at the broader issue in particular hospitals that have to deal with a crisis of patients on trolleys seven days a week. We have to do something about that. Despite the Government talking for the past four years about that issue, the situation is as bad as ever. It is not good enough. In my constituency, Beaumont Hospital urgently needs supports. It needs a quality system that will free up the beds for many patients who are stuck in accident and emergency not only on trolleys, but also on chairs.

Some nights one cannot even get a chair. I know that from direct experience myself because over a year ago I spent 24 hours on a chair before I eventually got into the system. We must face the reality in that regard.

We are discussing health insurance and reform of the health service but I wish to take the opportunity to refer to the disability sector. The sector has been penalised for the past four years due to repeated cuts. The Minister has an opportunity to put disability back onto the agenda and to reinstate and develop disability services. We, on this side of the House, will support him. The efficient management of resources is required. I strongly support such an approach.

We should take a broader view in the course of the debate. The health service should never be looked at as if it is just another business service. It is not a private business. We must accept that. Changes are required to be made very quickly when a crisis occurs such as flu or other epidemics such as Ebola. We must ensure we have the infrastructure to deal with issues as they arise. I do not enjoy listening to people prattling on as if the HSE is an SME when it is a health service. Like many colleagues, I firmly believe we should have a broader, universal health service that is paid for out of general taxation. That is part of my political vision for this country.

Currently, 700 people are in hospital who should be in other caring environments. If the matter were addressed, it would immediately free up hospitals beds which are urgently required in many hospitals. We must be radical, reforming and creative.

A total of 250,000 people dropped out of the private health insurance market in the five years to the end of 2013. Increases in premiums ranged from 7.3% in 2011 to 12.1% in 2012. In 2008, the average premium paid per insured person was €729, but in 2013 the average premium had increased to €1,050, representing a 58% increase in the period 2008 to 2013. That is an absolute scandal. Families are being hammered left, right and centre. Politicians wonder why people are very angry with the Government and disillusioned. Another reason for their anger is the significant increase in the premium for private health insurance. The average cost of claim per insured person increased by 12.6% per annum between 2008 and 2012.

The age structure of the market saw a significant ageing of the insured population. In 2003, a total of 13.3% of the insured population was aged over 60 but that had increased to 19% of the insured population by the second half of 2012. We must plan for the fact that people live longer. That is fantastic news, but we must also develop a long-term approach to deal with such issues in the health service.

The number of people in this country with health insurance was in decline from 2009 to the middle of 2014 but since then there has been a small increase of 1,000 people. However, people have major concerns about the overall decline and in particular the age profile of people with health insurance cover and the impact that might have on the sustainability of the health insurance market as a whole. We must be conscious that the health service is not a private business and things change by the moment. People live longer, cures are found and there is a general improvement in the quality of life. That is the case for approximately 70% of people, which leaves 28% of the population who are in a severely disadvantaged situation, who impact on the health service. There are also health implications for the 28.6% of children who were living in poverty in 2014. We must address the issue of economic disadvantage or we will have more problems in the health service and more people using the health service.

The market has also been affected by the increase in premiums and claims at a time of reducing income among consumers. In 2012, a consultative forum on health insurance was set up, which I welcomed at the time, as I considered it a very important development. We must get people involved who know the issue in a bit more detail. The Minister for Health has appointed a new chairperson, Pat McLoughlin, and the forum has already produced two reports. We must ensure that the reports and positive aspects of the legislation are included in the broader debate on health insurance.

The legislation seeks to amend the existing health insurance legislation. The principal Act is the Health Insurance Act 1994. The Bill also introduces a system of graduated discounting of health insurance plans for young adults aged between 18 and 25 years, inclusive. It would also permit an insured person to move from a restricted membership insurer to another registered insurer without an additional waiting period. I welcome the change.

As part of an annual process of adjustment, the Bill seeks to specify the amount of risk equalisation credits payable and the amount of hospital bed utilisation credit applicable from March 2015. The Bill also seeks to amend stamp duty levies and some technical amendments to health insurance legislation. These measures are designed to address the increase in premiums and stabilise private health insurance in the interests of consumers. I support the approach, which is sensible. The key point is that we must protect the interests of consumers – I prefer the term "citizens". I am concerned that our focus is still too much on a two-tier health service. We must deal with the immediate problem in terms of the Bill before us and the impact of market forces. However, we must also look to the longer term. For me, that means a universal health service.

The Minister probably would not agree with me but if he wants to see a good quality health service in a very poor country, he should take a trip to Havana for that purpose.

The Minister has been there.

Deputy Finian McGrath should look at their cancer survival rates.

When I was there a few years ago, I looked at the GP service and front-line services. Nobody was on a trolley in the accident and emergency departments. There was a quality health service even though the country is being hammered and bullied again by the Minister’s pals in the USA, but that is a debate for another day.

They just send people home to die.

Overall, I welcome the debate on the Bill and I look forward to hearing the contributions of colleagues.

I wish to make a point of order.

This is very important legislation. It is about containing the cost of health insurance for families across the State and it is very important that we have the Bill enacted before the end of the year. We lost our slot two weeks ago because the deputy leader of Sinn Féin had a temper tantrum and decided to have a sit-in in the Chamber.

We lost our slot earlier today as well.

We lost our slot this morning because the Sinn Féin spokesperson demanded that I would be in two places at once and now the Sinn Féin benches are empty. Its Members could not bother to be here, nor could Fianna Fáil. I have listened to them talk about the Government not respecting the Parliament, and parliamentary and political reform. It really churns my stomach to see the hypocrisy of Sinn Féin and Fianna Fáil in leaving their benches empty during this important debate.

The matter is outside my control.

The Independents are here.

Independent Members constitute the entire Opposition at the moment.

I thank the Minister for being present to listen to the few of us who are present at the moment. Parts of the Bill are good but I worry about other parts. Many families in the country are in distress with their mortgages currently and are afraid of more money being required by them to buy insurance. If they are struggling at the moment, they will struggle even more if we try to put more burdens on them. Before we impose charges on people to buy their own insurance, we must examine the procedures involved.

I have health insurance. A few years ago, a day procedure was not covered by health insurance but if one spent a few hours in a bed at night that stay was covered. A root and branch analysis is required of how costs can be cut and how efficiencies in the system can be implemented. For example, there is a need to deal with the cost of medicines in order to bring that cost down.

Deputy Finian McGrath informed the House in his contribution that 250,000 have dropped out of health insurance cover for the simple reason that between 2008 and to date, people did not have the money. People with young families who cannot afford to pay that bill will not pay it and they will hope for the best that they will not need the cover.

I am thinking about a young person in Roscommon, Leitrim or Ballinasloe who knows that the accident and emergency department in Roscommon is closed and there is speculation that Ballinasloe will be downgraded to a 12-hour accident and emergency department. I ask the Minister what is the buy-in for the people in those areas.

The recruitment of consultants and junior doctors is a concern. I offer a constructive suggestion to the Minister. If young people entering college are prepared to commit to working in the country for five years, I suggest that the Government would waive their college fees. This could apply to doctors and nurses as a carrot to dangle in front of them to keep them in this country. If we struggle to replace consultants and junior doctors, then we are in trouble and it is becoming a significant problem in many parts of the country.

People with disabilities need to be helped. I refer to cuts in funding for Ability West and the services run by the Brothers of Charity. We have to deal with the situation whereby a person in one part of Ireland is three minutes away from an accident and emergency department and another person is two hours away from that service. We need to be upfront and honest with people. The health service needs a radical overhaul because, in my view, we are going nowhere. The system is in chaos with elderly people currently waiting 15 to 20 weeks, a situation the Minister is endeavouring to address and this is appreciated. However, we cannot keep going from storm to storm because sooner or later the boat will sink in the sea.

I am not critical of the Bill because it contains some satisfactory provisions but we need to show the people a clear way forward. We are spending money educating medical and nursing students but once they have graduated they take a one-way flight. We need to invest in those people, to dangle the carrot in front of them. We need to be pound wise in this regard for the future. If we do not tackle that problem I foresee that it will be difficult to fill vacancies and it is a no-brainer that the health service will not work. I hope the Minister will take note of some of my suggestions.

Deputy Alan Farrell is sharing time with Deputy Liam Twomey and Deputy John Paul Phelan.

I welcome the contributions from the previous two speakers which I consider to be constructive and the Minister can speak for himself in that regard. It is heartening to hear Members being constructive on issues such as this because the purpose of this Bill is to attempt to reduce insurance premia so that the figures which Deputy Finian McGrath outlined of 250,000 leaving private health insurance over the past five or six years is tackled. An essential component of our integrated health system is that individuals have the option of taking out a health insurance policy but this must be affordable. A significant issue in recent years has been the ever-increasing cost of insurance premia from private insurance companies.

This Bill will encourage younger people to take out health insurance as they are vital to the lifetime community rating concept. Their participation is to their own benefit as they progress in life and it also supports older members of the community who may find insurance premia too expensive as they get older.

I welcome the proposal in the Bill to remove the 2009 interim scheme in respect of age-related credits and levies. From 1 March 2015, additional discounts of up to 20% will be available for those aged under 17 years and 17% for those over 18 years. I am a father of two young sons and I have a family insurance policy. The premium covering my two sons has been reduced by 50% which is very beneficial and will apply to many families who rely upon private health insurance companies to ensure they can access affordable health care. Such insurance is essential when one has children aged one year and three and a half years old and when one counts the number of visits to Temple Street hospital and to the GP in the past three years which would put a large dent in my and any family's cheque book. Children are prone to illness and to accidents and one must be ready to cater for those situations. Families need affordable health insurance policies because the waiting times to see certain consultants in the public health system can be as much as 18 months. The previous Minister and the current Minister have worked very hard to ensure that those waiting lists are reduced.

The number of individuals taking up health insurance has increased for the first time since the beginning of the recession, albeit it is a modest increase. This is reflective of the approach of this Government, the Department of Health and the insurance companies to deal with the spiralling costs. As the economy improves, the concept of private health insurance policies being a luxury commodity will, I hope, diminish, and people will begin to recognise the importance of such insurance.

I take this opportunity to note, welcome and recognise the work done with regard to medical cards, the more humane approach adopted by the Minister and the Department, in particular, when dealing with terminally-ill patients. This is a welcome development, even if late in the day. I acknowledge that this is part of the reform agenda which is taking somewhat longer to implement than some of us would wish.

Over recent years, the number of individuals between the ages of 18 and 25 who dropped out of health insurance has reduced by 31%. The age cohort of 18 to 25 year olds are the backbone of the private health insurance business because they pay their premia, they do not claim because they are for the most part young and healthy and they support older people who tend to avail of insurance a little more, for obvious reasons. This Bill will encourage younger people to take out health insurance policies along with initiatives by the insurance companies and this is welcome.

The lifetime community rating is a modification of the 2009 scheme and it aims to incentivise people to take out health insurance policies at a younger age.

Under the system those who take out insurance at a younger age and maintain it will pay lower premiums than those taking out health insurance at an older age, and this in itself it an incentive for those fortunate enough to be able to afford such a policy and who are in work. As the economy and the jobs market improve, and figures for this were announced yesterday, I very much hope we will see more individuals being able to take up insurance again, if their wage packets allow them to do so.

The Health Insurance Authority will mount a communications campaign on the changes being made in the health insurance market. Given the introduction of lifetime community rating on 1 May, such a campaign should start as soon as possible. Informing the public of precisely what we hope to achieve, not only through this Bill but through other measures taken by the Department of Health, is of paramount importance.

I am pleased to see credits for up to three years of unemployment since 2008 will be provided following the expiry of the grace period on 30 April for those who previously had health insurance. During the economic crisis premiums simply became unaffordable for many people throughout Ireland. Unfortunately such premium increases are an inevitable consequence of fewer people taking up insurance in the first place, because the fewer people in employment, the fewer policies are available. The cost of keeping such policies then becomes unaffordable and insurance companies must raise premiums because they are losing their customers.

Any measure by the Government to address these issues is welcome, as are attempts to reduce the cost of the provision of health care in the first place, to improve waiting times and to address issues such as those raised by other Members on important posts in the health service. The website is constantly looking for consultants of certain types, and it is very difficult to fill these positions, presumably because of the salary scale involved. Any measure to reduce the overall burden on the Exchequer for the provision of health care is welcome and this is one of those steps.

Rather shockingly, I must admit to being the third of the past five speakers to have visited Cuba. I did so a number of years ago on the expectation that President Castro would not be around for much longer and the country would greatly change in the coming years. While certain aspects of the health service might work pretty well, the Minister referred to cancer survival rates not being very hectic. What really struck me is that one is advised as a tourist to bring certain items which children in school often do not have, such as pens and pencils. I remember being part of a group that met two young lads. When we handed over pens and pencils to them, they smiled back most graciously. I was struck by the fact they both had immaculate sets of braces on their teeth, despite the fact they were barefoot and had virtually no clothes. Certain aspects of the health service in Cuba might be admirable, but the dire poverty in which most of the population lives, not to mention the political circumstances in the country, are hardly something which are desirable for Ireland.

I welcome some of the announcements made this week, particularly with regard to medical cards. Much pain, upset and angst were caused to people, particularly in the earlier part of 2014 with reviews and the loss of medical cards. The system announced and proposed by the Minister at the start of the week is a welcome development, and will ensure those who have terminal illnesses will not have their cards reviewed, and those subject to review heretofore will not be reviewed again. I welcome the Minister's actions in this area.

I also welcome some of the announcements made today on the HSE's service plan and the provision of approximately €10 million extra for the fair deal scheme. The waiting times at present are certainly too long and I hope the €10 million will go some way to significantly reducing the waiting periods. I welcome the inclusion of capital funding for the new emergency department medical assessment unit and endoscopy unit in St. Luke's General Hospital in Kilkenny, the building of which is under way at present. I hope it will be completed soon.

Some of our hospitals have difficulties recruiting for consultant positions. I specifically refer to University Hospital Waterford which, as I understand it, has 20 vacant consultant positions at present. I am not sure exactly what the cause is because I know many of these positions have been advertised. Sometimes applications are not received, or those who accepted have subsequently not taken up the positions. This leads to a great deal of hardship for a number of families and individuals in the south-east region.

There is not a great deal of disagreement among speakers on all sides of the House on the provisions of the Bill. There is no doubt the past seven or eight years have seen a significant reduction in the number of people who have private health insurance. This has coincided, not coincidentally, with the economic downturn. I hope that as the economy continues to recover and more people are back in work more people will be in a position to take up health insurance.

I certainly welcome the major provision in the legislation on the sliding scale for premiums for those under the age of 25. A great many of us did not have private health insurance when we were under the age of 25. I certainly did not until I was somewhere in or around my mid-20s. As Deputy Farrell pointed out, by their very nature people of that age tend to be more healthy and do not tend to put as much strain on the health insurance market by availing of insurance. However, they are an essential part of ensuring the health insurance market functions properly. The sliding scale proposed in section 7 of the Bill, which aims to reduce premiums to this category of people, is to be greatly welcomed.

While it is unfortunate there will be loaded premiums for those aged over 35 it is perhaps inevitable. In particular it is inevitable that there would be late entry loading for older people in their 60s who take up health insurance for the first time. I fully endorse and welcome the provision in the legislation which allows for the transfer of insured persons from restricted membership categories to other restricted membership categories. Recently one of my constituents was at the wrong end of the existing legislation in this regard and the provision in the Bill is to be greatly welcomed.

Deputy Mattie McGrath will share time with Deputy Lucinda Creighton. Is that agreed?

It is agreed, if she arrives.

The Deputies will share 20 minutes.

The main purposes of the Bill are to specify the allowable rate of net premium payable in respect of young adults; to provide for the transfer of an insured person from a restricted membership undertaking to another registered undertaking without the application of any additional initial waiting period; to specify the amount of risk equalisation credits in respect of age, gender and level of cover payable to insurers from the risk equalisation fund from 1 March 2015; to specify the amount of the hospital bed utilisation credit applicable from 1 March 2015, and to make consequential amendments to the Stamp Duties Consolidation Act 1999 to revise the stamp duty levy required to fund the risk equalisation credits for 2015.

The term "hospital bed utilisation credit" means the relevant amount payable in respect of each hospital stay, on or after 31 March 2013, involving an overnight stay in a hospital bed in private hospital accommodation by an insured person. Goodness knows, we need some of these issues. The prices health insurance companies are charging for beds are astonishing. There has to be a serious examination of these costs.

I am happy to have this brief time to contribute to the debate on an aspect of our health care system that is crying out for a more equitable application of regulations governing health insurance. In that sense I welcome those aspects of the Bill that seek to help tackle increasing health insurance premiums. The Bill aims to freeze stamp duty for public hospital cover, introduce young adult rates and reduce the Health Insurance Authority levy from 0.12% to 0.01%. That was greatly needed. Something had to be done to reduce premiums.

Earlier, Deputy Finian McGrath referred to some figures. I wish the Minister well in his new portfolio. The figures indicate that people have fled or rather were forced to flee by economic circumstances. No breadwinner in a household would want to give up health insurance, but it is a sad choice. I have a large family and we are at the pin of our collar to continue paying the health insurance. Thank God, they are all healthy. People, including elderly people, who have been paying for years, have been forced to give it up because of exorbitant increases in premiums. Other industries have taken repeated cuts in the past five years since the recession came, but this industry has increased its premiums every year.

The figures were already on the record, but I will refer to them again. Some 250,000 persons dropped out of the private health insurance market in the five years to the end of 2013. Those are working people, small business people and ordinary people who want to be able to pay to go to a private hospital. They do not want to put huge pressures on the public health service and are willing to pay but it has become impossible for them to pay because the prices have been hiked.

The increases in premiums ranged from 7.3% in 2011 to 12.1% in 2012. In 2008 the average premium paid per insured person was €729. In 2013, this had risen to €1,150, representing a 58% increase in the period from 2008 to 2013. That is madness. That any industry or insurance company could be allowed to get away with it indicates that the HSE and the Minister did not have their eye on the ball. It is reckless and puts huge pressure on already overcrowded and pressurised accident and emergency departments, and many other departments.

I compliment the newly elected Deputy Fitzmaurice, who is still in the Chamber, on his novel ideas about trying to get young graduate doctors and nurses to stay. They and their families have made huge efforts to put them through college to become qualified. I salute them for going into that noble profession. It is a pity that so many have to move abroad for work. There must be some clawback based on giving some service, giving something back. Loans could be provided for their education and maybe have a sensible payback system there.

The Minister has made the right sounds. The jury is out, but I wish him well. He should be given a chance to look at some ideas. The HSE and the whole system have failed us. Any industry with premiums increasing to that extent over the past five years without action is not fit for purpose. I am a small businessman as is the Deputy behind me. No business person could even dream of getting those increases in profits. The economy has gone the other way but those operating in this area have been reckless. I have many more figures but I will not quote them because the Minister has heard some of them already.

As the Minister said, regulation of the health insurance market should occur in the interest of the common good. We are all here to serve the common good. If we cannot serve the common good maybe it is time we packed our bags and stopped being public representatives. We are all elected in our own right by the people who expect us to work for the common good. I agree that central to any conception of the common good is a health insurance market in which intergenerational solidarity between all insured persons old and young exists in a fair and just manner. Community-rated health insurance systems across the world use risk equalisation as a mechanism to achieve such fairness. There are many examples across the world. I would not want to see us advocating the use of an American-style experience-rating model over the preferred community-rating model. What happens over there is not all good. A person over there with insurance is fine, but a person without insurance is in a very poor situation.

This is especially true given the dangers that exist for members of experience-rating schemes where the common practices of insurance companies is one of denying applicants insurance based on pre-existing conditions. If that was to happen in my business or that of Deputy Fitzmaurice, we would not be in business because there will always be accidents and incidents. Business people generally have a goodwill relationship with an insurance company - they strike a deal and carry on.

Experience-rating schemes also require a waiting period before pre-existing conditions are covered and drop members when they suffer an accident or get sick, which are not fair or in the common good. It is just another form of bullying. If the Bill sets out to counteract some of these kinds of outcomes then I welcome it even if I am uneasy about some of the provisions.

I hope the Acting Chairman will not mind me straying slightly from health insurance to general health issues. I agree with what the Minister said earlier about certain people demanding his presence this morning and stopping the work. We then wasted another hour back and forward with other issues which is not good enough. I had to put back by an hour an appointment in my constituency - some of us have further to travel than others.

The fair deal waiting list is putting pressure back on the system. There are people in hospital beds at €1,000 a night in my hospital - I do not know how much it is in bigger hospitals. They could be in a nursing home for €750 a week or less. The cap must be lifted there. The latest thing is charging for medical card patients if they spend more than 30 days in any hospital, whether it be respite, accident and emergency or a rehabilitation unit such as the one we have in St. Patrick's in Cashel. If they reach 30 days they are charged €25 a day. They do not have €25 a day. These are people who are sick and vulnerable. They would not owe €25 to anyone - they would not owe €2. They are getting sicker because they are getting these bills. I accept the hospital managements are doing their best to pay it at €2 a day, but if they are in for seven days a week they owe €175 out of the €200 payment. It is not possible.

I beg the Minister to show some humanity and address that issue because it is not fair. These are people who do not walk away from hospitals without paying their bills. They were born, reared and lived on the basis of paying their way. They would not buy something in a shop if they did not have money to pay for it. They never had holidays. They are not reckless people. It is not right to penalise them and frighten them. Spouses of patients have contacted me to say they cannot pay it. They would take their spouse, partner or sibling out of a hospital rather than accrue a bill they could not pay. That is not the way they operate. Their modus operandi is honesty and integrity, and to support the State and pay their way. To be threatened and intimidated, and get these bills is very hard and crude. Add that to the beds that are delayed the figures add up totally on the fair deal. It is nonsense and bad value for money to have bed-blockers in hospitals and also have that issue to contend with. It is just not acceptable.

We are hammering the working man and hammering the old. These are the people along with the small businesspeople that we need to regenerate our economy, to kick-start it and work to get us out of recession.

May I continue?

Go raibh maith agat. If Deputy Creighton arrives I will-----

I plead with the Minister to look at the system; he has put down markers that he intends to do so. We were promised by the previous Government, the leading parliamentary party off which I was a member for a good while, that the HSE would be disbanded.

We were promised that by the Minister's predecessor. I am not here to attack HSE officials but to look for some semblance of normality, accountability and understanding. I will welcome this Bill if it stops waste that is clearly occurring and insurance companies that have run amok. I know insurance companies have to be viable and cannot operate at a loss, but the rates charged by them are staggering.

I was a patient in a hospital in Cork a good many years ago and I could not believe the charges. I had to travel a distance the equivalent of from here to O'Connell Bridge or a little further and I could have walked it in the morning because I was fine but I was sent by ambulance. I could not have walked back because I had an anaesthetic but when I got my bill the morning I was leaving, which was ten days later, I nearly collapsed. That was 16 or 18 years ago, and I was charged £500 at the time for the trip. I shudder to think what a private ambulance would cost today. There is too much fat in the system in terms of charges. Someone must watch what is going on.

Another area of private health care relates to institutions. I salute the Brothers of Charity and other organisations that are providing much-needed services but in terms of their costs, one organisation is getting €860 million from the HSE. That is a huge amount of money. I have one sad case involving people who are very unhappy with the service. There must be accountability.

Regarding nursing care, qualified persons must be involved. We cannot have care people who do not have any qualifications. People who are sick need help, and that aspect must be challenged.

The people interested in the common good are depending on the Minister. The comic, Mr. Callan, might praise the Minister, and perhaps slag him, at weekends about his future roles in this or any other Government. I am up for that but I support the Minister being allowed to do his job. I will support him where common sense prevails and the common good is served. However, I will not support him when I see waste and there is a great deal of waste in this industry, and a great deal of over-charging. Costs are exorbitant. People must watch that. I know these issues are raised in the Committee of Public Accounts and other areas but they must be monitored on a daily basis.

I support what Deputy Fitzmaurice said about trying to put creative and innovative systems in place. We need change. Everything is back to the old system of not being able to do this or that. There are too many layers in terms of the people in the sector. We need a shake-up. Private people should be brought into this industry. I am not knocking all public officials but it must be run in a businesslike and compassionate manner. A fine balance must be struck between a business manner and a compassionate manner, but I see no sense in paying €1,000 a night for a bed when one can get seven days care in a nursing home in my county for €750. I have spoken to the hospital manager in South Tipperary General Hospital, which I prefer to call St. Joseph's, and it has offers from nursing homes to take people for less than that amount and we will lose out in terms of nursing home places because nursing homes will not be vibrant. They cannot remain viable when operating at half scale. They are a private business and they must break even. They have staff wages, insurance and all the other costs to pay, including oil for heating and maintenance, GPs and so on. If the bed-blockers and the capping system is not lifted, an issue which the Minister of State, Deputy Lynch, addressed in a Topical Issue debate with me, it will put huge pressure on the system.

I appeal to the Minister on the issue of medical cards. In the name of God and in the interests of common sense and common good, I ask him to desist from charging people who need a medical card. It is making them sicker and stressed and is also making their loved ones stressed. They have paid their way. They have no problem paying a doctor and would not go anywhere without the few bob in their handbag or pocket to pay their way. That is the kind of people they are. They is the way they were born, reared, bred and lived. They have lived frugally. For them to be asked for such charges puts them under pressure and it also puts hospital management and accountancy staff, who must be subject to audit, under enormous pressure.

I will support the aspects of this Bill that I find good and I look forward to the Minister's reply.

In the absence of Deputy Naughten, I invite the Minister to reply.

I thank Deputies for their contributions and broad support for the Bill. Its main purpose is to specify the risk equalisation credits, including a 50% increase in the hospital bed utilisation credit from €60 to €90 per night, and corresponding stamp duty levels from March 2015. In addition, the Bill will specify the allowable rate of net premium payable in respect of young adults, provide for the transfer of insured persons from a restricted membership undertaking without the application of any additional initial waiting period and make some other technical amendments to the Health Insurance Acts 1994 to 2013.

I would like to respond briefly to some of the issues raised, although many of them do not relate directly to the Bill. Deputy Kelleher raised the issue of universal health insurance, UHI. When I was appointed I took it upon myself to review the progress made to date and timescales for the implementation of a number of important reforms, including UHI. I remain committed to the important reforms the UHI system is intended to bring in but I do not believe it will be possible to have the full system in place by 2019, as envisaged by the White Paper. I intend to push ahead with key reforms such as GP care without fees for the youngest and the oldest in our society, the implementation of activity-based funding formerly described as "money follows the patient" and the development of the hospital groups, all of which are key steps on the path to universal health care.

Following the publication of the White Paper, a public consultation process was initiated and 137 submissions were received from members of the public and other stakeholders. An independent thematic analysis of submissions was received last month and that will be published in the future. In addition, a major exercise is now under way to estimate the cost of universal health insurance to the State, to individual households and to employers, and that has commenced. This work is being led by the ESRI and when I receive the results of this, which I expect to receive in the first quarter of 2015, I will then be in a position to make a presentation to the EMC and Cabinet sub-committee to set out the detailed next steps on the road to universal health care should the rationale for that remain in place.

As we all know, Ireland has a mixed hospital system where both public and private services are provided in public hospitals. The HSE has put in place specific measures to address waiting lists more efficiently in collaboration with acute hospitals, the special delivery unit, SDU, and the NTPF. These include strict observation of the national waiting list protocol, including strict adherence to chronological scheduling and biannual validation of lists for all patients waiting more than three months; adherence to the relevant HSE national clinical care programmes; flexible usage of theatre capacity with and between specialties; the introduction of centralised booking systems; pooling of lists, where appropriate; prioritising day surgery and admission on the date of surgery even if it is not day surgery; pre-admission clinics; and referral back to GPs for monitoring where possible. New pathways of care continue to be introduced to improve patient flow through hospitals, including, in particular, medical assessment, minor and local injury units, and urgent care centres, as well as the provision of care in non-hospital settings, which are increasingly used to provide a spectrum of care which supports the efficient use of hospital resources.

I welcome the Deputies' suggestions about retaining staff in the Irish health service. We are having difficulties holding on to nurses and doctors. It has always been the tradition that doctors and nurses emigrate, often to gain experience, but they tend to come back. They are not coming back in the numbers they used to for a number of reasons. It is not just down to salaries, although that is part of it. It partially comes down to the frustration of working in a system that has been creaking for the past number of years. I hope with the service plan published today and the first modest increase in spending in seven years that we will see some improvement in that regard and more hope across our health service. I note the suggestion that was made that we waive or pay the fees for people who agree to stay. There is some merit in that but, unfortunately, if we did it now, it would not produce results for a number of years or for at least a year, and there would be the argument that it should also be applied in other sectors where there are difficulties in recruitment. I welcome a positive suggestion and it is one that merits some thought.

It has also been mentioned that insurers should make more use of clinical audit to ensure the appropriate treatment of private patients. The McLoughlin report on the measures to reduce costs in the private health insurance market made a number of important recommendations, including the use of clinical audit. Insurers already have improved clinical audit, however. I agree that there is much more scope for improvement and I will be engaging with insurers on this issue through the consultative forum on health insurance.

In addition, when it comes to fraud, waste and abuse, the private health insurers have agreed to use existing anti-fraud and confidential hotline structures to facilitate combatting fraud in the private health insurance market.

This Bill, taken with the series of measures I announced to address the rising cost of health insurance premiums, are designed to work as a package. I want to make health insurance more affordable again for as many people as possible in a sustainable market and to try to limit the need for future increases. Following a lengthy period of rising premiums and a severe decline in health insurance cover the number of policyholders is for the first time in a long time increasingly slightly, with an increase of 1,000 in the number of people insured in the period July to September of this year. I hope these new measures will allow this trend to continue and that insurance companies will respond favourably.

I commend the Bill to the House.

Question put and agreed to.