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Dáil Éireann debate -
Thursday, 19 Nov 2015

Vol. 897 No. 2

Health Insurance (Amendment) Bill 2015: Second Stage (Resumed)

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

The Dutch introduced their model of private-public health care, with private insurance companies competing to access public health services in 2006. By 2011 the cost of an ever reducing basket of services had increased by almost 10%, with the cost of unincluded and uncovered services increasing by 50%.

Mr. Dutrée raised the prospect of health care costs in the Netherlands doubling over the subsequent ten or more years, painting a picture of the Dutch people paying at least 25% of their annual income on health care, making the Netherlands the dearest country in the world for access to basic care, even more expensive than the United States of America. Was anyone in Fine Gael or the Labour Party listening? Was the former Minister for Health, Deputy Reilly or the Taoiseach taking any of this on board?

There were countless other voices. Indeed, there was a parade of caution but regrettably, it was clearly a case of "carry on regardless" and what a carry on it has been. Con men and their fellow traveller con artists have fed the Irish public a fallacy over the past five years. The current Minister for Health, Deputy Varadkar has been hedging his bets on universal health insurance since taking over the health portfolio from his Cabinet colleague, Deputy Reilly, but it took the blunt honesty of the ESRI and Dr. Maev-Ann Wren's determination to call it as she saw it, to wrest an acceptance from the Minister that the truth must out. Now we know that the Government's health plan is not viable, never was and never will be.

The Minister, attempting a soft landing for his embarrassed Fine Gael and Labour Party fellow Ministers, has said that he has requested further research on universal health insurance. What of An Taoiseach? Yesterday, in the course of Leader's Questions, the Taoiseach exposed his continuing personal comfort with the universal health insurance multi-player proposition when referring to the ESRI analysis. He reluctantly confirmed, after advising he could argue certain points, that the Government would not proceed with "that model" of universal health insurance. That he is wedded to a form of health insurance as the paying mechanism for health care is beyond question. The Minister for Health, despite his preference for referring to universal health care as distinct from universal health insurance, is as committed to a universal health insurance model as his Taoiseach and political master.

What Ireland and its people need is a system of health care services delivery paid for by fair and progressive taxation, accessible on the basis of medical need - and need alone - which is free at the point of delivery. Sinn Féin is committed to such a system. We are committed to ending the discriminatory and immoral - I emphasise immoral - two-tier system that fast-tracks those who can pay, leaving the less well off to languish on waiting lists, many in pain and all suffering anguish as they wait and wait. A day will yet come when the shared view of the two-tier system of health care services and the piggy-backing of private practice and private access on our publicly funded health services will be one of shame. All political parties, civic society organisations and churches of all denominations should be vocal in their condemnation of what is happening in our health services today. They should all be committed to achieving a single-tier public health system of which we can all be proud. No-one who claims to believe in equality or who claims to be a republican can take any other position.

While I have indicated that my party will support the passage of this Bill, I again urge the Minister to park any further review of universal health insurance and to stick firmly to universal health care and how we can develop that through a fair and progressive taxation system. That is something that all elected opinion should be able to rally behind and collectively ensure the delivery of within the earliest timeframe possible.

I welcome the opportunity to speak on the Health Insurance (Amendment) Bill 2015. The Bill raises the question of equity of access to health services in this country. We currently have a two-tier health system where ability to pay is key to timely access to services but what we need is a system based on medical need and which is free at the point of delivery. That concept is becoming more widely accepted and should be at the core of the delivery of our health services. Professor Brian Nolan of the ESRI said recently that the two-tier system is now widely regarded as problematic from an equity perspective. In the same vein, Ms Suzanne Quin, senior lecturer in social policy at UCD said that a policy which enables those who can afford it to access alternative paths to what they see as being a more comprehensive, superior quality and faster service is hard to justify on grounds of social justice while Dr. Samantha Smith of the ESRI said that health services should be delivered according to need.

This is an enormous issue for our health service. We need a service based on medical need which is free at the point of delivery. Related to that is the provision of health services as close to the patient as possible, the funding of those services and their quality. The provision of health services as close to patients as possible should be a key priority. All services should be provided locally to service users where possible. I accept that specialist services always have been and will continue to be necessary and that patients will have to travel to regional centres and specialist hospitals to avail of them. However, 95% of services can and should be provided locally in local general hospitals such as South Tipperary General Hospital.

I wish to refer in particular to the provision of inpatient acute psychiatric services in County Tipperary. The decision to close the service was taken by the previous Government through the former Minister of State, John Moloney, while the implementation of that decision was carried out by the current Minister of State at the Department of Health, Deputy Kathleen Lynch. That decision and subsequent closure was made against the advice of advocates, general practitioners, consultants and the entire mental health community in County Tipperary.

We now have a situation where there is no inpatient acute mental health service in the whole of County Tipperary. People in the south of the county must go to Kilkenny for services and those in the north of the county must go to Ennis.

The inpatient service in Kilkenny is the one I know best and it is particularly dysfunctional. South Tipperary patients are being absolutely disadvantaged in having to travel to Kilkenny for the service. The service should be and could be delivered locally. I have regular contact with families who tell me it is very difficulty to get admitted to the inpatient services in Kilkenny. When a person is admitted, there are questions around early discharge and follow-ups are not carried out by the same consultant. This is unacceptable. A strong case can be made for inpatient services to be provided in Tipperary. Will the Minister examine the situation again and put in place, as requested, a small inpatient unit for the county? Eight or ten beds would be adequate.

The community-based teams are not staffed properly. They are deficient, in particular, in respect of paramedical staff, physiotherapists, occupational therapists and social workers. Despite the best efforts of the staff, who provide a good service, they are hampered by the lack of fully-staffed community-based teams.

Will the Minister provide additional funding and staff for the general hospital service? In particular, I speak about South Tipperary General Hospital. The hospital has lost about 20% of its budget, which is about €12.5 million, and approximately 100 staff members. As a result, members of staff are working under huge pressure on a 24 hour basis. They have done tremendous work, given the hospital is running at a capacity of approximately 120%, but the situation simply cannot continue. Staffing levels need to be urgently addressed and, in particular, additional nursing and support staff need to be put in place.

The lack of funding and resources creates a particular problem in the accident and emergency unit. People are on trolleys for long hours and often for longer than 24 hours. The service urgently needs to be sorted out. We were promised an additional ten step-down beds. These beds are urgently needed to address the difficulties in the accident and emergency unit. We also need to open additional beds in the hospital to cater for the overflow from, and difficulties in, the accident and emergency unit.

The hospital needs capital development. A phase two development for the hospital is on the books. I urge the Minister to provide the capital investment required for the phase two development of the old part of the hospital. The new endoscopy, surgery and theatre services provided a number of years ago were an excellent development and are working very well but the older part of the hospital requires urgent attention and capital funding. Will the Minister make moneys available for the phase two development of South Tipperary General Hospital?

Apparently, Deputy Michael Fitzmaurice will not be coming in. I do not think I will need all the time allowed.

Tá 20 nóiméad ag an Teachta ar aon nós.

I do not know about the Minister but I get a pain in my head when I begin to think about things such as risk equalisation, risk equalisation credits, lifetime community rating and all the other very technical and complex stuff contained in the Bill and which revolve around the private health insurance system. However, the pain I get in my head is minor compared to the pain and hardship felt by people who have to wait for hours, if not days, on trolleys. It is minor compared to that suffered by people who are waiting in chronic pain for more than two to two and a half years for operations.

I mentioned a lady in my constituency who is looking for a hip replacement to the Minister a while ago. This lady rings me regularly. She is in absolute dire and chronic pain. She cannot move. This woman worked very hard all her life. She is told there is an 18 month waiting list but, as she points out, it took her approximately six to eight months to get on the list. The 18 months clock only started ticking then. She asks me what she is supposed to do for the next 18 months given she cannot move. This is the suffering that is going on. We then have the shambles in child mental health services and the chronic under-resourcing of residential care for people with disabilities. The list of chronically under-resourced health services goes on and the people who the health service is supposed to serve continue to suffer terrible hardship.

Is there a connection between the pain I get in my head when I think about risk equalisation, risk equalisation credits and lifetime community rating systems and the labyrinthine systems surrounding the competitive private health insurance industry? I put it to the Minister that there is and it has now been exposed by what one might argue is an unlikely source. It is certainly not a radically left source. The source is the ESRI and its report on the universal health insurance model, a model the Government claimed it was going to deliver and claims it had been working on since it was elected.

The ESRI has blown out of the water all of the main contentions this Government put forward about the merits of universal health insurance. It has confirmed all the key criticisms of those of us who opposed that vision and model and said it would not work. By extension, it has confirmed the private health insurance industry is simply not the way to deliver the sort of health services people who are sick and in pain need.

Trying to trawl through the complexities of this stuff is a pointless and futile exercise. All of it is unnecessary; it is waste. We are developing a complicated system to guarantee the private profits of a parasitical, profit seeking, health insurance industry that does nothing to deliver the health services people need. It is purely parasitical. The ESRI confirms this when it indicates that the €300 million margin that is taken by the private health insurance companies is one of the major reasons, if not the major reason, that the universal health insurance model the Minister had championed is simply not workable, will be too expensive and will not deliver for the patients. That is due to their profit taking. This confirms what we have been saying to the Minister and his predecessor for four years. When the Minister's predecessor made grand announcements about how the universal health insurance model would begin to be rolled out from January this year and would be completed by 2019, that it would provide a better, more efficient and cheaper service, reduce the cost of health care and so forth, we said the opposite would be the case. All the international evidence, and this is confirmed by the ESRI, showed that it would be the opposite and that it would make health care more costly and would not deliver the goods in terms of services.

If we are honest and apply ideological commitments to competitive insurance markets and competition in the health area, is it not blindingly obvious that the private health insurance industry must take €300 million in profits, it must have a big administration for sending out bills, it must pay big executive salaries to the top people in the private health insurance companies and it must advertise? One cannot move without encountering private health insurance advertising. It is everywhere. It is on advertising hoardings, radio stations and television. That costs big money. The people who take out private health insurance are paying for it. Ordinary citizens are paying for these advertisements, the executive salaries, the profits and for the huge billing, none of which contributes anything to front-line services for the people who are waiting for two years for an operation or for days on a trolley. Is it not obvious that this is simply waste?

That is the reason we find it difficult to get our heads around a Bill such as this. The legislation is trying to manage an irrational and parasitical system. Risk equalisation is about keeping the private health insurers in business so they can make money. It is about luring them in. The Minister and I debated this issue on a television programme and I was one of the few people who was very critical of the Minister. I am not throwing language around loosely but I believed the measures introduced by the Minister meant the Minister was effectively acting as a tout for these private, for-profit health insurance companies. He was saying to people that if they were over a certain age they would be penalised unless they had already taken out private health insurance. That was scaring people into taking out private health insurance, a huge amount of which then goes into waste on advertising, billing and executive salaries. I forgot to mention the private consultants. A sum of €400 million per year goes from the private health insurance companies into the pockets of private consultants. That is waste. To top up their already substantial public salaries they receive an extra €400 million from the premiums paid by people for private health insurance.

What does one get for one's private health insurance? I have never taken out private health insurance, and I never will, because apart from not believing in a two-tier system in which one pays to jump queues, it is clear one does not get anything for it. The big news that must be conveyed to the people who are terrified into taking out private health insurance is that one gets nothing for it. If one has a heart attack one ends up on a trolley in the same way as everybody else. That is the truth. One might move a little faster in the queues for some operations, but not for others. I have much anecdotal evidence that people sometimes get things faster in the public system in some areas, even though they will still have to wait for months, than they would in the private system.

Has the Minister or the Government even quantified any of this? I have mentioned the amount of money that goes to private consultants from the private health insurance system. Do we know how much it spends on advertising? Would it not be useful to find out how much is wasted on advertising and billing administration? I asked about this with regard to the public health system last October. I tabled a parliamentary question seeking the annual cost of collecting fees in public hospitals for the last four years, including administration costs, the cost of debt collection agencies and legal costs. The Minister did not know the answer so he passed the question to the HSE. The HSE has passed it on to the hospital groups because it does not know either. How are we to have an efficient health system when the Minister does not know how much this stuff costs? How are we to accord him any credibility? Fine Gael is supposed to be the party of efficiency, yet the Minister does not even know how much this stuff is costing us. It is an absolute waste. Money is going on this stuff and even on the parliamentary questions that go back and forth in an effort to gather information about it. We would not have to ask them if the money was not going on this but into front-line health services.

International evidence shows that what I and other Members on this side of the House have been saying for the past four years is right. The cost of health insurance in Holland went through the roof under the model the Minister was pursuing. In the United States, billing costs account for over 30% of overall health expenditure. Please do not tell me that is efficient. That is the inevitable result of believing in competitive markets and competitive private health insurance being an integral part of a health system. It is simply parasitical. We can argue the toss on the efficacy of markets. There is not much strong evidence. The only evidence I am ever quoted about the efficacy of markets is Ryanair, God help us. Whatever about the airline industry, and it is debatable in that case to put it mildly, it just does not work in health care.

The other argument I hear, and I listened to a debate on the radio about this, is that if we had our way all the doctors would leave the country because we want to cut their wages to €100,000. There has already been emigration of some of our consultants, nurses and so forth. It was pointed out to me today that the consultants in the NHS are only paid €70,000. The Minister can shake his head, but that is what I was told. Perhaps he will give me the figures.

It is the basic salary before the performance bonus and almost all of them get the performance bonus.

Okay, it is €70,000 and perhaps they get a few bonuses or whatever. It is still well below-----

It is sterling, incidentally.

No, I was told it was €70,000, but let us see the figures. The ESRI says in its report that the cost of universal health insurance systems, regardless of where they are, is more expensive than systems of universal health care such as a national health service of the type we are proposing.

However, it would appear that in Britain, even with any extras there might be, consultants are not getting paid what they are getting paid here. They are getting paid less but they are not flooding out of the NHS. Why? By God, the Tories have done their best to wreck the NHS but even still, the National Health Service model is better and more workable and is not the shambolic chaos we now have in our health service. Most doctors are not greedy so-and-sos. As long as they are paid a reasonable amount of money - I cannot see what the Minister is holding up-----

It is an article which reads, "NHS warned of exodus of young doctors as registrations to work abroad soar". Some 98% have just voted to strike.

Members should speak through the Chair. The Minister should not be showing off an article.

I cannot read the detail of it from here.

It is in the English newspapers.

Fine, but I still-----

Will you please speak through the Chair?

Sorry, a Cheann Comhairle. I still contend, even if, as the Minister is suggesting, they are going on strike for better pay, what they are looking for would still leave them earning considerably less than what consultants are getting here. If we add in what the consultants are getting in private practice, given they are paid by the public purse and, then, as I mentioned, get €400 million from the private health insurance companies, they are earning pretty good money over here.

The reason they are leaving is because the health service in a mess. When the bag I carry my computer in burst, and I had to get another bag for the computer, coincidentally, I found an article written by Senator John Crown three or four years ago in which he made exactly this point. He said the reason doctors are leaving is not primarily to do with pay; it is to do with the mess in the health service. The international evidence shows this. Now, the ESRI is confirming that the Minister's model is basically null and void.

What is the alternative? The alternative is the national health service model. It is a one-tier system, with health care based on medical need, free at the point of delivery. Why would that be more efficient and cheaper? It is because there would not be all the waste, with excessive money going to private consultants through private health insurance companies, and all of the advertising, the billing and the unnecessary administration. The money could just be focused on the health service.

Would it still cost us, given this is the other thing the Minister will say? It would cost us. The ESRI suggests that in order to deliver the Minister's model, we would need between €500 million and €2 billion extra. I would say we still need that and probably a bit more - probably €2 billion to €3 billion - and we would certainly need to reverse the cuts that have been imposed in recent years, when the Government cut the budget from €17 billion to €13 billion and axed 10,000 staff and thousands of beds. That would need to be reversed and we would need more investment in a number of areas. One way or another, we need more money in the health service. However, if we did not have all of this profit-taking by private health insurance companies, the unnecessary and excessive money going to private consultants, and all the administration, billing, advertising and so on, that money could be directed to front-line services where it would be more efficiently spent. In addition, I, the Minister and ordinary members of the public would not have a pain in the head, never mind the pain we may be feeling in our bodies, when we think about the health service, because it would be simple. We would not have to think about it; we would just go and get the service as we need it.

Instead, we have this unbelievable, labyrinthine, shambolic, chaotic, failing system that even the Minister now has to acknowledge is failing and has to be reviewed. Four and a half years after the big promises, we are going to review it all again. I suggest that the review is a fundamental, root and branch abandoning of the privatised, private insurance model of delivering health care. We need to move to something that works, which, whenever it has been done, is the national health service model. That is what we need. The sooner this Government or any Government cops on to that, the better.

Of course, we can pay for that by just making those at the top pay a little bit more tax. To be honest, I think everybody would be willing to pay a bit more if they knew they were going to get a health service that works. The Government needs to make those at the top pay a fairer contribution towards the provision of the services we need for a civilised society.

I call Deputy James Bannon, who is sharing time with Deputy Michelle Mulherin.

I welcome the Minister for Health. The €6 million he gave for the new accident and emergency facility at the Midland Regional Hospital in Mullingar means work is progressing there in a very satisfactory manner. Another issue I have raised with him time and again is the development of step-down facilities at St. Joseph's hospital in Longford. It would take great pressure off the services at the Midland Regional Hospital if this were to happen. Hopefully, the Minister will have news on that in the not too distant future.

The Health Insurance (Amendment) Bill 2015 is important legislation as it seeks to ensure that our older citizens and people with illnesses can afford health insurance and are not discriminated against by insurance companies in favour of younger, healthier people. Throughout my time in the House, I have always found that the foremost theme associated with health care debates is equality. This Bill relates to equality of insurance.

Risk equalisation was introduced in Ireland as a way of levelling the playing field between younger and older health insurance customers. While there has been a long-running debate about the benefits and negatives of risk equalisation, I find that the pros heavily outweigh the cons. For example, without risk equalisation, there is no incentive for insurance providers to cover the needs of older or less healthy people. Indeed, like car insurance, premiums would be heavily risk-related on the age profile of consumers and no real equality would exist. Therefore, I find myself in full agreement with comments made by the Department of Health about risk equalisation. The Department is on the record as stating:

The risk equalisation system protects the right of older people to purchase health insurance at a reasonable rate. Without it, the competition in the market is distorted because insurers with a majority of senior citizens are at a significant disadvantage.

I came across an interesting statistic while researching this legislation. On 1 July 2015, there were 118,000 people with health insurance aged between 60 and 64. If this legislation is enacted, the age at which credits are payable will rise from 60 to 65. This will benefit insurers, like VHI, which have a much higher proportion of older customers than other insurers. Therefore, not only is this legislation about ensuring equality for the consumer, it is also about ensuring equality for the providers of insurance and creating a better market for both the consumer and the supplier.

The issue of stamp duty charges is another important aspect of this legislation. The reduction in stamp duty charges on non-advanced policies will make it cheaper for insurers to provide these products to customers.

The corresponding stamp duty levy will be reduced on products not providing advanced cover for an adult from €240 to €202, which is a reduction of €38. For a child, it stands at €80 and goes back down to €67, a reduction of €13. While this is to be warmly welcomed, it must be pointed out, as some Deputies have already, that the vast majority of people have advanced policies and these have only been adjusted by 1%. We can all agree that 1% is very unlikely to have an effect on the prices for insurers or consumers. I would like to see this particular area of the legislation being urgently addressed.

There are two further points I would like to make. The first concerns the reduction in the Health Insurance Authority levy. The levy is set to be reduced to a rate of just 0.01% of insurers' premium income for the years 2015 and 2016. This will result in savings for insurers of €2 million in both years. After that, the levy will be set at 0.09%, which is a substantial reduction on the current levels of 25%. Second, I wish to pay a special tribute to Mr. Pat McLoughlin, with whom I worked closely on the old Midland Health Board. He produced two reports on private health insurance. I remember reading his first report, which was published in the run up to Christmas 2013. This report outlined a scheme of life-time community rating and discounted rates for young adults. I am pleased to see these recommendations are being acted on by the Minister and I look forward to reading Mr. McLoughlin's second report, which has just been published.

I have touched on a few brief aspects of this legislation. As I stated at the outset, this Bill is all about equality, particularly for our older citizens. The major aim of the legislation is to make health insurance as affordable as possible, reducing the chance of a spike in premiums and ensuring that insurers who have a much higher proportion of older customers are also treated with fairness.

Now is the right time to try to take a new approach towards health insurance and we are doing so with the legislation before us. In addition, we are widening the scope by making it as equal as possible. The Minister and his officials are to be commended on this progressive and reforming legislation.

I welcome the Minister's forthright approach to universal health insurance, UHI. He has accepted the findings of an ESRI report on the particular UHI model which was being considered. It was found to be unaffordable and, therefore, the Minister will not pursue it. This is about taking stock and it is a practical and reasonable position to take. All the while, the Minister has confirmed his commitment to equalising universal health care, thus bringing a two-tier system to an end. However, as well all know, this will not happen overnight. It is not like declaring war. One cannot declare universal health care; it is something that has to be knitted and weaved together. One must put the foundation stones and the building blocks in place first. Reasonable people know it is more than just about having universal health insurance to provide universal health care. It is also about addressing issues such as capacity, resources and the management of those resources.

I welcome some of the reforms the Government has already undertaken on the path towards universal health care. These include free GP care for under-sixes and over-70s, as well as pushing forward with free GP care for under-12s. In addition, the development of primary care centres will handle chronic illnesses in the community rather than being treated in accident and emergency departments. If such conditions are not controlled and managed at primary care level, it can result in blocking acute hospital beds.

Hospitals groups have been established to achieve excellence of treatment by creating a confluence of expertise and sharing resources between hospitals in those groups. I also wish to compliment the Minister for additional funding for the fair deal scheme for nursing home care. In October 2014, 79 people in County Mayo were waiting to get into nursing homes. I was acutely aware of it, with many people contacting my office. Some people had to spend their own resources, which they simply could not afford to do. A year later, only four people were on the waiting list which is now down to two to four weeks.

There is continuous recruitment of nurses, doctors and consultants. I listened with amusement to Deputy Boyd Barrett who mentioned the high cost of consultants. As we all know, however, wages and salaries paid to consultants, doctors and nurses here are not as attractive as in other countries. To compound that, is Deputy Boyd Barrett actually suggesting that we should tax them more and use it to pay for the health service? He is not in the real world at all; he is talking about a fantasy land with oppressive rich people. We need to get these consultants, doctors and nurses because they make for a good health service. We also must compete in an international market because our graduates are much sought after.

Community services catering for those with dementia and Alzheimer's will require additional resources in future. In addition, we must take care of the carers because invariably such medical conditions are progressive, so those affected require care on a 24-7 basis. Some €27.5 million was pledged for the provision of integrated dementia services, which was to be co-funded by the Department of Health and Atlantic Philanthropies. I am concerned, however, because there are approximately 48,000 people with dementia and Alzheimer's in this country. Some 63% of them are being cared for in the community, which in effect means in their own homes. This money is, however, predominantly being spent in big centres of population, so only 500 families might benefit of the 30,000 people who are living with dementia at home and being supported by a community care policy.

I understand that only 56 of those packages have been authorised, despite all that funding. I am concerned because in County Mayo, we have an estimated 1,835 people with dementia but I am not aware that any of this funding is going to the county. The county has an ageing population and a proportionately higher number of older people compared to other counties. Given the projected figures for a rising number of people suffering from dementia, there will be an increased demand for such care services. I would like to know what the regional spend is in this regard and how much is being spent in County Mayo. The Minister may not have the answer to hand but it is important because there are many dementia patients in County Mayo.

Caring for the carers means that as well as having integrated care packages, we should also provide respite for carers. I am particularly concerned about a 12-bed respite care facility, Marian House in Ballindine, which is run by Western Alzheimers. It provides respite for 510 families in counties Mayo, Roscommon and Galway. There is a waiting time of between eight to 12 weeks for them to get respite. It is tailor-made care for people with Alzheimer's. HIQA has been into that facility and has said it must have €500,000 worth of works carried out to the premises, or it will have to scale down or possibly shut down in March 2016. What assistance is available to such respite care homes funded pursuant to section 38?

I urge that assistance be made available to them. I understand that they deal with the HSE. There is no service within the HSE that is comparable with the service provided by Western Alzheimers. It is doing a job where a gap in services provided by the HSE has been identified. It would be very much to the detriment of Mayo, Roscommon and Galway if such a service was to close. It would put huge pressure on these families, which are often put to the pin of their collar emotionally and financially in caring for their loved ones in their own homes.

The Minister may not be in a position to take any of those questions now or answer them in a fulsome way but I ask for a fair distribution of funding for integrated care packages tailor-made for people with dementia throughout the country - not just in Dublin or Cork. Some of that funding should come to Mayo and the west. I ask the Minister to look at respite care and the problems facing Marian House in Ballindine and take it up with the HSE. I am very concerned about it. There are a lot of volunteers in the community whose families have benefited from the service provided and who give passionate and strong testimony about the invaluable service and understanding provided by Western Alzheimers. I would like to see it continue. A lot of local fund-raising goes on as well but I do not know how it can possibly manage €500,000 between now and then. It needs some help and I am asking the Minister to take up this issue.

Today we are witnessing yet more legislation which seeks to further preserve the private health insurance industry. I am opposed to the Bill because I am opposed to the special protection afforded to private health insurance companies which profit off the backs of citizens. The Government’s priority has never been to establish access to health care based on need as opposed to the ability to pay. Instead, it has gleefully pushed the two-tier model left behind by flawed Governments of the past. Despite a nationwide call for a more compassionate health care system that does not abandon our elderly in the accident and emergency department corridors and that does not discriminate on the basis of ability to pay, we continue to bolster the health insurance industry. The Government’s inability to govern has meant a disintegrating health care system. Its failure to respond adequately to the health needs of the nation is shown by policy after policy that not only fail desperately but cause real damage to people's health in our country. While successive governments established the unfair two-tier system, this Government has pursued it, bringing inequality in access to health care to an unprecedented level. It was this Government which was responsible for implementing a permanent risk equalisation scheme in 2013 when the Health Insurance (Amendment) Act 2012 commenced and it has since failed time and again to govern on the health issue.

Despite an increase in health expenditure arising from this year's budget, health spending levels are still below pre-crisis levels by at least €1 billion. Free GP care for those over 70 is not sufficient to meet the health needs of elderly people. The correct Government policy would have been to assign free medical cards to those over 70 covering a range of community services, including hospital visits, dental services, prescription medicine costs, hospital care, optical and aural services, social work services and other community services. The Government also increased hospital charges, introduced new drug charges for medical card holders and increased charges for prescription items. These were all introduced in response to the so-called economic crisis. The Government's increase in drug charges was another step away from universal health care. The Mapping the Pathways to Universal Healthcare project in 2014 showed that Irish citizens paid €599 million more on prescription drugs and hospital charges than they did in 2007.

The Minister's imposition of a deadline last May for those under 34 years of age to acquire health insurance is another failed policy and another step away from universal health care. Anyone over the age of 35 who cannot afford private health insurance will be discriminated against on the basis of their age and inability to pay. In 2012, the former Minister, Deputy Reilly, introduced a target of nine months for hospital appointments. In 2014, the Minister doubled that target to 18 months and admitted even that it was unambitious. There are now more people waiting for outpatient, inpatient and day case hospital appointments than there were in 2012. This is a sad indictment. Furthermore, the Minister also failed in his suggestion that private companies could be allowed take over the management of under-performing public hospitals under future health service reforms. Is this the real model we are going to see in respect of the Minister's universal health insurance policy where hospitals will be handed over to private companies and a licence to print money is granted to them?

The Minister has also proposed that newly formed hospital groups should have the freedom to make collective agreements and negotiate independent contracts with staff "outside of the constraints of public sector rules in the way semi-State companies do now". Should they should also in his view be allowed to put the running of those hospitals out to tender because that seems to be way he will pursue the privatisation of health services?

At least one positive element emerged this week with the Government abandoning the plan to introduce universal health insurance with a multi-payer competing model. This model, which is based on the Dutch model, would have been disastrous for us. It would have seen the complete handover of control of the operation of our health service to the private sector. Perhaps that is something Fine Gael would like to see but it would have been a disaster and I welcome the fact that it has been abandoned. However, I am very worried that we will see an underhand development whereby the hospitals I mentioned earlier will be handed over individually on a piece-by-piece basis to private operators who can profit from them.

The introduction of this Bill which is another step away from universal health care by expanding on the lifetime community rating model which will only exacerbate the inequality of our two-tier health system. It privileges the access of private patients over public patients and is a step backwards on the road to universal health care, propping-up the profits of private health insurance companies and our two-tier system of health care.

What have all these disastrous policies done to people across Ireland? They have increased inequality in our health system through propping up the private health care system. What we need is a universal health care system. This can be brought about by establishing a fully functioning primary care model. People's health security is depleting and their health is in jeopardy. It was the Government's policies over the past four to five years that increased the costs of health care and reduced access for those who need it, which has left the prevalence of illness in this country still nowhere near under control.

The first Healthy Ireland survey provides up-to-date figures on the extent of illness in Ireland. Previous health research was cancelled due to austerity measures so this is the first data available since 2007. The nationally representative survey of 7,539 people found that 28% of the population has a health problem or long-standing illness, 19% are limited in their daily activities due to ill health and 43% had a health issue in the past year. The Irish Cancer Society published The Real Cost of Cancer Care, a survey of 409 people that shows the real costs of having a prevalent disease like cancer. A total of 35,000 people will be diagnosed with cancer this year. The survey found that the average additional cost of cancer was €862 per month and 40% of those surveyed did not have a medical card.

Regional health inequality has further marginalised people in rural constituencies. There is now a significant shortfall and geographical disparity in the supply of GPs and health inequality is becoming an increasing problem. We are witnessing a declining proportion of GPs working in rural areas, particularly in County Donegal. It has declined from 33% in the early 1990s to 22% in 2005. In County Donegal there are 48 to 57.7 GPs per 100,000 of population. The Government must recognise the peripheral nature of counties like Donegal in order to retain GPs in rural areas and restore the rural practice allowance to maintain GPs in our counties.

It is clear that we must move away from a privatisation model towards a universal one based on the need of services. The only way to achieve this is through the development of a primary care system with universal health care at its core. However, primary care has been talked about for over a decade now with very little results. Research has consistently proven that primary care is the best system, both in terms of equal access and cost effectiveness.

Strong primary care is associated with better population health, lower rates of unnecessary hospitalisations and relatively lower socio-economic inequality. Countries with strong primary care spend less on health care. However, Ireland's is the only EU health system that does not offer universal coverage for primary care.

Once again, the Minister is pushing further away the idea of a universal, single-tiered health service, which guarantees access based on need, not income. How can the promotion of greater uptake of private insurance and ensuring the structure of life-time community rating in our health system be seen as a step towards universal health care? Increasing the numbers of people with health insurance contradicts the notion of universal health care.

Today, there is still no right to health care in the Constitution or through any statutory provision even though Ireland is a signatory to Article 12 of the International Covenant on Economic, Social and Cultural Rights which recognises "the right of everyone to the enjoyment of the highest attainable standard of physical and mental health". Unless we recognise and vindicate that right, we will never provide a universal health care system in this State.

If the public needed evidence that we are further than ever away from the universal single-tiered health service promised by the Government parties ahead of the last election, which guaranteed "access based on need not income", it need only read this Bill. The Bill promotes what the Government sees as a cost-effective private health insurance market without moving to a clear timetable for the introduction of universal health insurance. It makes clear in one sense that mandatory private health insurance is still the Government's goal. The taxpayers who are being incentivised to purchase private cover already fund the health system. The one third of their salaries taken in tax pays for the provision of hospitals, doctors and nurses. The Government is attempting in this Bill to dupe them into not realising that private health cover is effectively double taxation. That approximately 300,000 people have left the private health insurance market since 2008 speaks volumes. Many who managed to hold on to it are struggling to do so. They are terrified by the prospect of ridiculously long waiting lists, particularly for non-life threatening illnesses. None the less that has the potential to make their lives miserable. Almost 1,000 people have been waiting for over two years for outpatient appointments at the University Hospital Waterford, despite numerous promises from the Minister for Health and his predecessor that these waiting lists would be tackled. I and many others believe that people are not signing up for the privilege of a private room in a hospital as private cover guarantees the insured in many hospitals in Europe. For most procedures, regardless of the level of cover, the patient will be put in a ward in a public hospital, like it or not. I have spoken to many in the past few months who had the top level of health insurance but that did not matter.

Many of the 100,000 who bought private cover over the past 12 months to beat the new deadline that would have made it more expensive as they got older did so as their confidence declined and they had a sense of panic about what was happening in the public system. They did not sign up because they thought they were getting a bargain, as many Ministers and Government public relations attempted to portray it to the media. Many have no choice but to have private health insurance because they know the consequences of going through the public system, with waiting lists for elective surgery or to see a specialist or consultant.

Some of the previous speakers said that consultants are not getting the money they should get. This is probably one of the few countries in the world where consultants do not work weekends or do shift work. It is outrageous. If a person has a heart attack at the weekend in Waterford, he or she is sent to Cork or Dublin because at 5 p.m. or 6 p.m., there is nobody there, apart from a consultant on call and a patient is lucky to get him or her. I do not know what the opinion polls show but when people analyse what is happening in the health system after this length of time and all the money supposedly spent, they will realise that they are afraid to turn up in a hospital because they may have to wait to be looked after. I have brought two or three examples to the Minister’s attention of the dire consequences of not having a specialist on duty. In one case, a man who had four stents complained of chest pains but as there was no consultant, he was seen by a doctor in the accident and emergency department who took approximately 30 minutes to get there, through no fault of his own. The coronary ward was full and he could not get into it. The man died. While I am not saying he would have survived had there been a consultant in the hospital, he did not have the chance he deserved. There are people waiting in the long grass on this issue. That man's family, who have appeared on "Prime Time", were not necessarily supporters of mine or anti-Government. I do not know what their politics were but it is a big family and they are aggrieved and in a state of shock and turmoil because of what happened to their father. This is serious in many hospitals. I can only speak for what is happening in the hospital in Waterford. Nothing is being done despite all the promises made about regeneration of the hospital services with 24-hour coronary care. That has not happened and will not happen this weekend when somebody might have a heart attack.

There is a generation of people with private health insurance who are already financially crippled by the universal social charge, colossal mortgages, property tax, and the list goes on. As far as I can gather from this Bill, and the Minister can correct me, it will not guarantee that the cost of insurance will go down at all. It will go up and insurers can put it up if they wish but there is no guarantee it will go down. Insurers will be allowed to retain discretion on whether to introduce higher rates. The health insurance levy went up 149% in the past five years. The Minister says he hopes to create a culture of competition between private providers. That is not good enough because he and I know that will not happen. It will go up and it is unlikely that it will go down. If it goes down momentarily, it will go back up.

Another disappointing aspect of the Bill is that it does not address pre-existing conditions. These will not be covered for up to five years by a private health insurer. If a person wishes to upgrade, and no doubt many will because the entry level provides very basic cover, insurers will be allowed to restrict cover for any medical condition that existed prior to the previous level of cover for at least two years. That should be reconsidered. I do not know what it means but it is terrible. Bringing forward the Bill is the Government’s attempt to create a sense of urgency and panic, coupled with the problem of waiting lists and the overall decline in the public system. It is scaremongering many young people into purchasing health insurance that they cannot afford.

It is all very well for those of us in opposition to be critical, and the Minister is right to say that at times we can be critical and do not offer alternatives. Some of us do but some of us just posture. I do not make derogatory remarks against any Minister or member of the Government but on the issue of health, we are nearing the end of 2015 and the start of 2016 and while there is no question that the previous Government bears much of the responsibility for what happened in the health service, the Minister is completely wide off the mark in that he has not listened to people who work in the health service or to people like myself and other Deputies who are inundated every week with calls to our constituency offices and who meet people in our constituency offices who are strapped for cash and cannot get even the basic care they need. The quality of life in any society is based to a large degree on the standard of education and health and while I am not speaking about the issue of education, we cannot but say that the health service is in meltdown. If one speaks to any people who have been in hospitals around the country, they will say that the health service is in a critical state, with waiting lists to try to get access to the service. In a western country if we cannot depend on a consultant to help save someone who has a heart attack on a Friday, Saturday or Sunday, that says it all.

I call Deputy Olivia Mitchell who I believe is sharing time with Deputy Dan Neville.

I did not realise that but if he arrives, that is fine.

The Deputy should keep going until-----

Until I have to stop.

I welcome the opportunity to discuss this year's adjustment to the risk equalisation scheme because it is not a secret that I have always been uneasy about the operation of such a scheme and its impact in terms of cost to health insurance customers, and its impact on competition generally.

I understand that the Health Insurance Authority, whose job is to advise on changes required to the scheme, is more than aware of the gravity and implications of its task, and I am sure it does everything possible to minimise costs, but the truth is that once someone starts to interfere in any market, no matter how hard they try to be precise and how careful they are in trying to isolate the differences in costs attributable to the difference in the customer age base, they cannot know with any certainty what the cost base and price might have been in a fully competitive market.

I understand the need to protect VHI customers and, consequently, the VHI itself but it must be remembered that the VHI was born and grew for 50 years in a totally protected environment, with zero competition, and all the young people who wanted insurance were insured by it. Despite that privileged position, and despite the long run-in it had in terms of the change brought about by EU deregulation of health insurance, it failed to accumulate the reserves required of the private sector and now requires a subsidy from its competitors to stay afloat.

My purpose here is not to criticise the VHI, of which I have been a member for over 50 years, and will remain one. I want the VHI to survive and prosper but I worry that we may be subsidising it for inefficiency, therefore losing all the possible benefits of competition. I realise that is due to the almost impossible task of trying to extract the extra cost of its carrying older people from, for instance, knowing the extra cost of carrying those older people if we had full competition. Consequently, it behoves us as legislators to inform ourselves and be constantly vigilant about a risk equalisation scheme and its accompanying stamp duty levy.

When it was first introduced, the levy on every insured person's premium was €160; I believe that was in 2009. Since then the total amount paid in levies by insured persons of all insurance companies is over €2.5 billion. It would not be accurate to say that has been the price of competition but it has been the loss to consumers of the potential benefits of competition. I am aware that is due to the fact that existing providers were sucking up all the young health insurance seekers.

When we interfere in the market for good reason, which we all know is to protect the investment in VHI over the years and to ensure that it will have money to pay for older people like myself and the Ceann Comhairle, we must be sure that competition has brought at least some benefits to all those insured. We rely totally on the Health Insurance Authority to guarantee the benefits of competition. It is its job, in addition to advising on the risk equalisation payments, but I wonder if equal attention is given to both objectives. I do not know that and I wonder if it is even knowable.

One of the important measures in this Bill, which I welcome, is to change what is considered to be the measure of health status for the purposes of determining the levy and the risk payment, and including day cases as well as hospital nights as an indicator. The Minister said earlier that 30% of hospital activity now consists of day cases, so it should be included, and I agree it should incentivise more efficient use of our hospitals. However, how is it expected that it will have no significant impact on the levy? I read a quote from the Department that it did not expect this to have any impact on the levy. I do not understand how that can be the case. I appreciate that excluding the age cohort from 60 to 65 will have a mitigating impact on the levy but will it be enough to offset a one-third increase in the number of cases? In, say, two years time when this is bedded in, I wonder if we will be able to say that it has had little impact on the consumer price of health insurance. Increasing the age threshold for risk equalisation payments will benefit the provider with most older people. If there is any possibility that these payments have any element of subsidising inefficiency, this change means we run the risk of increasing and reinforcing that inefficiency.

There is one other aspect of the legislation which I very much welcome and believe is a measure to reduce the danger of subsidising the form of monopoly over and above the necessary subsidy required by the different age profiles. That is the move towards creating diagnosis groups in an effort to get a more refined measure of health status. I understand that this cannot be introduced until better data collection methods are available but it at least demonstrates an awareness of the dangers of looking mainly at the different age profile.

I am not opposed to any of the measures in the Bill but I want to reiterate my concern about the possible pitfalls of risk equalisation and its impact on competition. I would point to a number of reasons that should concern all of us and why they should continue to command constant vigilance by this and future Ministers. First, since the liberalisation of the market kicked in, several new operators have come and gone and only this week we heard that another operator is to sell on. The only provider still standing is the one which is the major recipient of the levy. I do not know if there is any causal relationship between those two facts but we have to ask if there is such a relationship.

Second, many people mentioned the report published this week on universal health insurance. It is taken as a given that it is not as imminent as we previously thought. That makes it all the more important to ensure that the system of health insurance we do have works as efficiently as possible for consumers who are paying dearly for it, and will continue to pay dearly for it.

Third, in the context of the many people in recent years who left insurance and the young people who chose not to take out insurance during the worst of the recession, two measures were introduced to bring them back in. One was a reduction in premium for very young entrants to entice them back in and the other was a late entry loading for anyone who had not taken out insurance before the age of 35.

This was done with very good reason, which I perfectly understand, and what is more, it is working. When we consider that the purpose of setting up this whole complicated and arcane risk-equalisation scheme was to ensure community rating, in other words that everybody would be charged the same, I do not know if anybody else sees the irony in the situation where saving community rating means doing away with it for these groups. So we will now be charged differently from everybody else.

I know it is working, but the point I am making is what a tangled web we weave when we interfere in or try to second-guess the market. I accept completely that compensating for different age profiles is a very difficult task, but that is not to deny the need for it for the moment. Presumably, eventually the age profiles will themselves equalise and we will not need a risk-equalisation scheme. We really need to monitor this scheme extremely carefully and ongoing vigilance is absolutely necessary. To the extent that the measures in the Bill will help to ensure the scheme works as efficiently as possible for consumers, I very much welcome it.

I thank Deputies for their contributions to the debate and the broad support from most parties for the Bill.

I am concerned that some of those who spoke against the Bill and intend to vote against it have got the wrong end of the stick. They seem to suggest that the Bill is designed to support or subsidise the health insurance industry. That is not the case; the purpose of the Bill is to underpin community rating, which prevents health insurers from charging older people, people with poor health status or sicker people more than they charge anyone else. That is why I am somewhat confused over why people might oppose the Bill.

I can understand that some people who believe in a public-only system may wish to abolish health insurance altogether. I do not agree; I believe people should be allowed to spend their own money on their own health if they so wish, as we allow them to do in all sorts of other spheres.

A fully public system based on need and not ability to pay would still require some level of rationing. All health services have some level of rationing, some level of waiting lists or some level of exclusion criteria because certain interventions are not cost effective. Are we really suggesting to people that they must accept that they cannot use their own money on their own health? I do not agree with that. In a free society if people want to spend their money on their own health, their children's education or whatever, they should be allowed to do so. That is why I think the debate about a single-tier system versus a two-tier system misunderstands the reality of health care.

Even in countries with extensive and advanced national health services, for example, the United Kingdom, people still have health insurance, where 10% to 15% of people take out insurance through BUPA which allows them to skip queues, have the consultant of their choice or have their treatment in a private hospital. Unless we were to outlaw private medicine and outlaw health insurance then we need some sort of legislation to underpin it and regulate it.

The purpose of this legislation is to ensure that health insurers cannot discriminate against older people or people with poor health status. I would have thought that on that basis, those who purport to support equality and social justice should be supporting the Bill and not opposing it, unless it really is their contention that they wish to make it illegal for people to spend their own money on their own health should they so wish and to outlaw private medicine altogether. I am not aware of any democratic country that has ever done that.

The main purpose of the Bill is to specify the risk-equalisation credits and corresponding stamp duty levies, from 1 March 2016. The Bill will set credits for the 60 to 64 age group at zero, while increasing the credits payable for those aged over 65. The Bill also provides for an improvement in the health status measure under the scheme by expanding the setting in which a utilisation credit will be payable to include day-case admissions. This increases the support provided by the scheme to all less healthy insured people. In response to Deputy Mitchell, it does not affect the levy because the levy is set in law. It may affect premiums, which is a different thing. However, I do not think it should have a major impact on premiums given that it is a relatively small measure.

The introduction of a utilisation credit for all day-case admissions to hospital increases the support provided under the scheme for less healthy people of all ages. The credits provided are set at low enough levels to retain the incentive for insurers to minimise hospital stays where appropriate and to implement the most cost effective, clinically appropriate treatment pathways. The reduction in stamp duty for non-advanced contracts supports the provision of lower cost entry level products and will support the sustainability of the market. These changes, coupled with the ongoing increases in employment which is a key driver in the demand for health insurance, will support the market and everyone wishing to avail of private health insurance.

A particular issue was raised on overcompensation and profit. Overcompensation arises if an undertaking, a health insurer, that is a net beneficiary of the risk equalisation system makes a profit that exceeds a reasonable profit over a three-year period. Reasonable profit is defined as a return on equity not exceeding 12% per annum on a rolling three-year basis, using approved accounting standards and having regard to the European Union framework for state aid in the form of public service compensation.

The avoidance of overcompensation is a fundamental part of the risk-equalisation scheme. In recommending the level of credits to be provided to insurers, the Health Insurance Authority must have regard to the aim of avoiding overcompensation or excess profits. The authority is also required to assess whether the risk-equalisation scheme overcompensates any insurer. Once a year, by 1 May, insurers are required to provide the authority with profit and loss accounts and balance sheets in so far as they relate to Irish health insurance business.

The authority assesses if any insurer has been overcompensated by risk equalisation, enabling it to earn in excess of a reasonable profit. If the authority determines under the Health Insurance Acts that an insurer, which is a net beneficiary of the risk equalisation scheme, has been overcompensated, a draft report is issued to the insurer. The authority will then take account of any submissions received from that insurer before making a final determination on overcompensation. If the authority determines that overcompensation has occurred, it issues a report to the Minister and the insurer concerned stating the amount of the overcompensation. The insurer must then refund the amount of overcompensation to the risk equalisation fund. No overcompensation has occurred to date under the scheme. To the end of 2014, profit as a percentage of earned premium in the market is 3.3%.

I again thank the Deputies for their contributions and their broad support for the Bill.

Question put and agreed to.