Seanad Éireann debate -
Tuesday, 11 Jul 1995

Vol. 144 No. 8

Adjournment Matters. - Psychiatric Health Insurance Costs.

Ms Honan

I thank the Minister of State at the Department of Health, Deputy Currie, for coming to the House.

I am concerned at the likely effects of changes in health insurance regulations being proposed by the Minister for Health, Deputy Michael Noonan, including the effect they will have on the future availability and quality of psychiatric care in Ireland. At present, people in need of psychiatric treatment who are members of the VHI are entitled to 180 days in-patient treatment each year and people who are suffering from alcohol dependence or other forms of substance abuse are entitled to 90 days in-patient treatment every five years.

The draft regulations pursuant to the Health Insurance Act, 1994, have been published and the Minister is proposing that companies wishing to offer health insurance in Ireland need only provide a minimum of 40 days in-patient treatment per year, and for sufferers of substance abuse, only 40 days in-patient treatment in a subscriber's lifetime. I am concerned, as are providers of the service and families of patients, that these minimum periods will become the norm. This is not acceptable. Many people who suffer from psychiatric illness recover very quickly, but many more need long term care and support in order to recover fully. Mental disorders which are treated by modern psychiatry do not involve highly expensive, hi-tech appliances. However, they rely on some effective treatment methods and these can take place over a long time.

It appears that it is only psychiatry and the psychiatrically ill that are being singled out for discrimination in terms of the time allowed for in-patient treatment under this new proposal. There is no other area within the health services in which the Minister is proposing to set minimum cover periods. By doing so in the area of psychiatric illnesses he is discriminating against sufferers in a way that would not be acceptable in any other form of illness, and is not acceptable with regard to psychiatric illnesses.

The alteration in cover for people suffering from psychiatric illnesses will reduce the role of private psychiatric services from that of providing professional in-patient treatment and after care to short term care because many patients will not be able to afford to stay in these institutions for longer than the period that is going to be covered by the insurance costs. They will, therefore, have to use public psychiatric hospitals which are already strained, or else become a burden to their families. Indeed, the introduction of this severe restriction will have a very damaging impact on the sufferers of psychiatric illnesses, especially their families, who will then bear the burden of caring for them when their health insurance cover expires.

There is no need for such a draconian minimum period and the VHI, which is the only health insurance company currently operating in this country, has not sought a reduction in the number of days allowable, either for psychiatric illnesses or for those suffering from alcohol or drug dependency. The competition in the health insurance market will not, therefore, be affected by this new legislation which demands a minimum that is less than is covered at present.

Why did the Minister for Health find it necessary to introduce this minimum requirement and why has he refused to meet representatives of the two major providers of psychiatric care in Ireland, St. Patrick's Hospital and St. John of God Hospital? I understand that they treat more than 90 per cent of all private psychiatric patients in this country. There is a misconception that these private psychiatric hospitals tend to have people suffering from alcohol abuse for long periods. However, it has been shown that the average length of stay in these hospitals is no longer than the average length of stay in general public hospitals, so this argument cannot be levied against them.

I have had representations from a number of people, including parents of psychiatrically ill patients and from the hospitals, who believe that this minimum level, which is likely to become the basic level, will result in approximately 30 per cent of patients currently being treated in the private psychiatric sector having to seek care from the public sector. Patients most seriously affected would be those who suffer from serious psychiatric illnesses, who tend to spend longer than usual in psychiatric hospitals. They are people who are single, separated, female and young, people who have, in the main, been committed to psychiatric hospitals because they are psychotic and disturbed. Many of them are part of the most vulnerable groups who do not have much social support, resources or family support. These changes could, therefore, seriously affect this group of people in a way that would not be acceptable.

The alterations in cover for people suffering from alcohol dependence and other forms of substance abuse, from the current provision of 90 in-patient days every five years to 40 days in a lifetime, will reduce the role of private psychiatric services to that of providing scarce and valuable professional in-patient treatment. In addition, the restrictions on in-patient psychiatric care, together with the miserly recommended but minimum rate for day care psychiatric services, which is £15 per patient per day, will effectively mean that the role currently played by private psychiatric services will be substantially eroded. There is a policy to attempt to move people out from large psychiatric institutions and to attempt to have people treated, where possible, in the community or by attending day care hospitals. In this respect, a rate of £15 per patient per day is a small amount to pay these hospitals. There is no incentive for them to develop these day care facilities.

The proposed changes will be borne by patients who are most seriously affected by psychiatric illnesses, and by their families. Would it be possible for the Minister for Health to meet with representatives of these patients and the hospitals who are currently looking after them? Would the Minister also consider ensuring that the level of cover currently being provided by the VHI would be the recommended minimum levels under the new regulations and that the psychiatrically ill would be treated no differently from patients suffering from any other physical illness?

Minister of State at the Department of Health (Mr. Currie)

I thank Senator Honan for raising this issue and for giving me the opportunity to elaborate on it. As part of the Single Market developments in the EU, all health insurance companies who wish to enter the Irish health insurance market must meet certain criteria set out in the Health Insurance Act, 1994. This Act came into effect on 1 July 1994. These criteria are that premia must be community rated and that insurers guarantee open enrolment to their schemes and lifetime cover. A further requirement is that insurers must provide a minimum level of benefit so that their members have a guaranteed level of cover against costs. The draft health insurance regulations which have been issued to interested parties have been written pursuant to the 1994 Act. Departmental officials have consulted with a wide range of interest groups, including public and private sector service providers, since the publication of the draft regulations. The consultation phase on the regulations, which began last March, is now being finalised.

For psychiatric services the draft health insurance regulations require insurers to provide a minimum of 40 day in-patient cover in any one benefit year. They also set out minimum payments in relation to in-patient and day patient services in private psychiatric hospitals. The minimum cover of 40 days for in-patient treatment is, I would emphasise, only a minimum period designed to set a basic level of cover for in-patient psychiatric treatment. Insurance companies are free to offer any higher level of cover they wish. I stress this is the first time that psychiatric cover will be required on a statutory basis and the minimum requirement of 40 days will, therefore, give a guarantee to subscribers that some level of such cover will be available to them. It will also prevent a situation developing whereby, as in many health insurance schemes abroad, insurers refuse to offer benefit for psychiatric care or offer it at less than 30 days.

The benefits payable to private psychiatric hospitals for in-patient and day patient services have been set at a level so as not to be inherently inflationary. If they were set any higher a situation could arise whereby a hospital which charges rates lower than the minimum benefit would be paid at the higher rate.

With regard to the specific issue of day care cover, the Department of Health is currently examining the components of day care in psychiatric hospitals. The area is, however, ill-defined and the Department is examining the possibility of dropping the requirement for day care cover in the regulations and examining it in a review of the minimum benefit regulations by an assessor later this year.

It is essential the minimum benefit entitlement does not adversely constrain the development of a competitive market in private health insurance. In arriving at the minimum benefit levels set out in the draft health insurance regulations, we have tried to strike a balance between the commercial needs of the insurer and protecting consumers by requiring companies to provide a minimum level of cover across a broad range of services.

The EU Commission would not accept a regulatory framework which would require insurers to offer benefit which simply repeated the 180 days hospital cover available from the dominant insurer. It would see this as presenting a barrier to trade to insurers, which goes against the thrust of the Single Market.

These regulations are not set in stone. The Minister will appoint a minimum benefits assessor in the autumn whose role will be to review the minimum benefit regulations. The assessor will review the regulations to take account of developments in the market, new technology and procedures and inflation. The regulations can be changed to incorporate the recommendations made to the Minister for Health by the assessor. In the autumn the Department will consult with all interested parties, including the private psychiatric sector, in regard to the appointment of the assessor.