Tuesday, 2 July 2013

Questions (640)

Dara Murphy


640. Deputy Dara Murphy asked the Minister for Health with regard to existing Government inpatient levy on private health insurers, if the new charge on private health insurance for the full cost of a public hospital bed is a double tax on private health insurance; and if he will make a statement on the matter. [31517/13]

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Written answers (Question to Health)

At present, private in-patients in public hospitals are subject to maintenance charges that generally range from €586 to €1,046 per day when they are accommodated in a private designated bed. However, in an emergency admission if a private designated bed is not available and a private in-patient is accommodated in a public bed, the maintenance charge is currently not levied, although the private in-patient continues to pay the fees of his/her hospital consultant.

The Comptroller and Auditor General has reported that 45% of in-patients treated privately by their consultants were not charged for their maintenance costs because they were not occupying private-designated beds. This situation represents a significant loss of income to the public hospital system and an indirect subsidy to private insurance companies, who cover most private patients. I believe that this situation cannot continue and that the new charge makes sense. Up to now insurers have enjoyed a significant subsidy, where these private patients have only paid a standard €75 charge per day to the hospital even though they have seen and paid their consultant privately.

The gap between the cost of providing this service to private in-patients and the amount that public hospitals are currently allowed to raise from those private patients is estimated to be about €200m per year. The subsidy is equivalent to the cost of treating over 30,000 public patients every year or operating a medium size public hospital. While everyone is entitled to use a public hospital, some people choose to be treated privately, in which case they have chosen to pay the consultant and the hospital. The Government believes that users of private services should pay for the costs of providing these services even when they are provided by a public hospital.

As part of Budget 2013, the Government announced that it would raise €60m in 2013 under this heading, and €115m in a full year. This represents a modest phasing in of the charge – as called for by the insurers themselves - and is a relatively modest extra cost on an industry that pays out some €2 billion in claims costs every year.

The Health (Amendment) Bill 2013 is presently before the Dáil and provides for charges to be levied on all in-patients who are treated privately by their consultant, irrespective of where the patient is accommodated in the hospital and regardless of whether they are admitted directly or through emergency departments.