Health Insurance (Amendment) Bill 2014: Second Stage

I move: "That the Bill be now read a Second Time."

I welcome this opportunity to address the House on Second Stage of the Health Insurance (Amendment) Bill 2014. The main purpose of this Bill is to specify the risk equalisation credits and corresponding stamp duty levies from 1 March 2015. In addition, the Bill will specify the allowable rate of the net premium payable for young adults and provide for the transfer of an insured person from a restricted membership undertaking to another registered undertaking without any additional initial waiting period. I will also make some technical amendments to the Health Insurance Acts 1994 to 2013.

I recently announced a series of measures to address the rising cost of premiums for private health insurance. This follows completion of the second phase of Pat McLoughlin's report on health insurance costs, which was developed with the assistance of private health insurers, the Health Insurance Authority and the Department of Health. Taken together, these measures aim to ensure that private health insurance is affordable to as many people as possible in a sustainable, competitive market. The continued improvements in the economy create a positive backdrop. Employment grew by 2.4% in 2013 and the Economic and Social Research Institute is now forecasting a 1.8% growth in employment in 2014 and 2.7% growth in 2015.

It is reasonable to expect that the introduction of lifetime community rating from 1 May 2015, combined with the improvements in employment, will result in the numbers insured either holding steady or increasing modestly over the next year. The improvement follows a sustained period of problems in the industry - serious growth in costs and falls in membership of health insurance plans. For example, coverage of health insurance fell from a peak of 50.9% of the population in 2008 to 44% in June 2014. Average claims costs per insured person rose by 12.6% from 2008 to 2012.

However, more recent data are a little more positive. There was a welcome fall of 2% in average claim costs in 2013 and a reduction in the rate of claims inflation. We will monitor data to assess whether this is part of a continuing downward trend or just a blip. In particular, I am pleased that the size of the market contracted less in the year to July 2014 than it did during the previous 12 months. The reduction has improved from a fall of 63,460 members in the year to mid-2013 to a reduction of 36,000 in the year to mid-2014. As Garret FitzGerald might have said, the rate of decrease is decreasing. In fact, in Q3 of 2014, we recorded a small increase in the number of people with health insurance for the first time in many years.

I recently announced a number of important measures for the health insurance market. These include lifetime community rating, reduced rates for young adults, a reduction in the levy for the Health Insurance Authority and no change in the stamp duty levy for the risk equalisation scheme. I will detail each of these measures in turn.

I am introducing lifetime community rating from 1 May 2015. Lifetime community rating is a modification of community rating to reflect the age at which a person first takes out health insurance. Its primary purpose is to encourage people to purchase health insurance at a younger age. This spreads the costs of older and less healthy people across the market, helping to support affordable premium levels for all. Those who take out private health insurance earlier in life and retain it will pay lower premiums compared to those choosing to join when they are older.

From 1 May 2015, there will be late entry loadings for those aged 35 years of age and over who purchase private health insurance for the first time or renew after a break in cover of more than 13 weeks. The loadings are set at 2% per year starting at age 35 up to a maximum loading of 70% at age 69 and over. There is a grace period until 30 April 2015 to allow as many people as possible to take out health insurance. During this period, no penalties will apply. Following expiry of the grace period, there will be credits for previous periods of health insurance cover and credits of up to three years for unemployment since 2008, to reflect the impact of the recent recession.

The Health Insurance Authority will run an extensive communications campaign to publicise this significant change to the health insurance market. It is important that the public has enough notice of its introduction and sufficient opportunity to take out health insurance before the introduction of loadings.

I have decided in this Bill to remove the single very large step-effect increase in premia rates that occurs for most young adults after their 21st birthday. For many, premiums can increase by 100% or more. The Bill provides for the introduction of a young adult rate of premium that is age-based rather than student-based and is designed to smooth out the rise in premia between the child rate and a full adult rate. Insurers will retain the discretion whether to provide young adult rates. Where an insurer chooses to provide young adult rates, it must provide the full range of rates within the specified bands. This policy change will also remove the requirement to be a dependant of a policyholder or a full-time student dependent on parents.

I have also looked closely at the levy payable by insurers under section 17 of the Health Insurance Act 1994. This levy funds the work of the Health Insurance Authority, the statutory regulator. Regulations made in 2010 set the rate at 0.12% of insurers' premium income. In its annual report for 2013, the HIA reported a surplus of €10 million. As a contribution towards lowering costs in the industry, I have decided to reduce the levy to a nominal rate of just 0.01% for two years, with savings to the industry of €2 million in both years. Thereafter, the levy will be set at 0.09%, still a reduction of 25% on current levels. The HIA is satisfied that this level of funding is appropriate to fund its ongoing operations and the rate of levy will be subject to periodic review by my Department. I signed the statutory instrument for this earlier this week.

The risk equalisation scheme is designed to protect community rating by making it easier for older people to afford private health insurance. I am committed to making the scheme as effective as possible in a way that promotes fair and open competition. This scheme is funded by stamp duties levied on health insurance policies and the money generated is used to pay risk equalisation credits to take account of the higher costs of older and sicker people.

In recent years, it has been necessary to increase significantly the stamp duty on all policies in order to fund the rising costs of an increasingly older and less healthy population of insured people. The increase last year on advanced products was €49 per adult and €15 per child. I am pleased that with the agreement of the Minister for Finance, there will be no increase in stamp duty rates for products providing advanced cover in 2015. The levy will remain unchanged at €399 per adult and €135 per child. In addition, there will be a reduction in the levy rate for products providing non-advanced cover. The levy for an adult will be reduced by €50, down from €290 to €240, and for a child, it will be reduced by €20, down from €100 to €80, achieving reductions of 17% and 20%, respectively.

I am glad that at least one of the four insurers has already confirmed that it will pass on this reduction. These changes will apply from 1 March 2015 and follow the formal advice of the Health Insurance Authority, HIA. The effectiveness of the risk equalisation scheme, RES, is measured by the extent to which it compensates for the higher costs of older customers. The overall changes to the RES in 2015 improve its effectiveness for older age groups. In fact, most people over the age of 70 hold products providing for "advanced cover".

In this category, the revised rates will compensate for 81% of the higher claims costs for those over 70 and 88% of higher claims costs for those aged over 80. These changes are in line with the risk equalisation policy statement announced by my predecessor, the Minister, Deputy Reilly, in November 2013, which set a target of increasing effectiveness to 85% for those over 70 years and 90% for customers aged over 80 years by 2016. This target is subject to the advice of the HIA, the requirement not to over-compensate any insurer and to Government budgetary decisions each year.

This year, the Department and the HIA commenced work on a more refined health status measure using diagnosis related groups, DRGs, to enhance the risk equalisation scheme by improving support for less healthy people of all ages. The HIA carried out an analysis of international regimes and submitted a report to me on incorporating DRGs into the risk equalisation scheme. I will use this report to inform the changes that will be proposed from 2016 onwards.

I am determined to address the issues contributing to increased costs in the health insurance sector. In 2012, the Consultative Forum on Health Insurance was established to generate ideas to address the issue of health insurance costs. In June 2013, Mr. Pat McLoughlin was appointed as independent chairperson of the forum. The measures I have outlined here today are closely aligned to the recommendations of Mr. McLoughlin's two-phase report on private health insurance costs. The first report was published in December 2013 and the second was published last week. Mr. McLoughlin recommends a scheme of lifetime community rating and discounted rates for young adults. Both measures are before the House today.

I have also accepted the recommendations relating to the implementation of a case-based charging system using DRGs for private patients in public hospitals under the money follows the patient or activity-based funding model. I have also accepted the establishment of a steering group to build on the reforms under way in the area of the prevention of chronic disease. This will focus on the provision of an integrated model of care for patients with chronic conditions.

Other recommendations being implemented include an increased focus by private health insurers on combatting fraud in the private health insurance market and the establishment of a working group with the HSE and the health insurers on the recommendations relating to claims processing. Mr. McLoughlin's independent reports make several important recommendations under the headings of controlling costs, care settings and resources, age structure, clinical audit and utilisation management, private psychiatry, fraud waste and abuse, chronic disease management, claims processing, and admission and discharge processes. I have instructed the Department to pursue these, in conjunction with the private health insurers and the HSE, as appropriate. These measures, combined with the recent decision by my colleague, the Minister for Finance, not to decrease tax relief on health insurance premia and the freezing of hospital bed charges, all aim to support a competitive health insurance industry. From now on I want to place the consumer's needs at the centre of decision making and policy formulation.

I will now outline the specific sections of the Bill. Section 1 defines the principal Act as the Health Insurance Act 1994. Section 2 amends section 7(5)(b)(i) of the principal Act. The proposed amendment will provide for a sliding scale of young adult rates for health insurance premiums up to and including age 25 and will remove the requirement to be in full-time education or to be dependent on the policy holder. A new subsection 5A provides that where a health insurer proposes to offer young adult rates it shall offer the full range of rates within the specified bands. Insurers will retain the discretion whether to provide young adult rates, although it will be possible in future legislation to make this mandatory.

Section 3 amends section 7A of the principal Act. The regulations to provide for lifetime community rating take effect on 1 May 2015. From 1 May 2015 there will be late entry loadings for those aged 35 and over who purchase private health insurance for the first time, and are renewing after a break in cover of more than 13 weeks. This amendment clarifies that the obligation on insurers to impose lifetime community rating loadings as provided for by regulations is mandatory, by replacing "may" with "shall" and by clarifying in subsection 3 that the obligation to require the payment of late entry loadings is subject to the regulations signed into law on 7 July 2014.

Section 4 amends subsections 8(3) and 8(5) and deletes subsection 8(6) of the principal Act. The additional provisions proposed in 8(3) and amendment of 8(5) are made to clarify that people transferring from one health insurance policy to another health insurance policy are not required to serve additional waiting periods other than those applying to an upgrade in cover. Section 8(5) is also amended to provide for the transfer of served waiting times for people transferring from restricted membership undertakings to open market insurers, without the application of any additional initial waiting period. Subsection 8(6) is consequently deleted.

Section 5 amends section 1 Ic of the principal Act to provide for 1 March 2015 as the effective date for revised risk equalisation credits to be payable from the fund. Section 6 amends Schedule 3 of the principal Act to provide for the revised amount payable from the risk equalisation fund for the hospital bed utilisation credit. This will cover health insurance contracts renewed or taken out from 1 March 2015. Section 7 replaces table 2 in Schedule 4 to the principal Act with effect from 1 March 2015 whereby the applicable risk equalisation credits payable from the risk equalisation fund for certain classes of insured persons are revised. Section 8 amends section 125A of the Stamp Duties Act 1999 to specify the applicable stamp duty rates for the periods 1 January to 28 February 2015 and 1 March 2015 onwards. Section 9 provides for the Short Title, collective citation and construction of the Bill. I commend the Bill to the House.

I welcome the opportunity to speak on this Bill which we will support. We have been calling for many of the measures announced in the Bill with regard to lifetime community rating and the need to ensure there is risk equalisation that is fair and supports those who most need it.

While we welcome the Bill, it comes against a backdrop of great uncertainty about the Government’s policy on health insurance in general. It opposed risk equalisation in the past. It was vehemently opposed to the concept whereby the market would support those who most need it, older people and those with illness. We welcome its recent conversion.

The broader issue of where we are with regard to the roll-out of universal health insurance, which is still a central plank of Government policy on funding health care in the years ahead, is central to this debate. We are still unsure of what the Government intends to do. I believe that it wants to slowly abandon this policy, to judge by the Minister’s language and tone. He speaks about “universal health care” and universal health insurance has been dropped from his vocabulary. Can we have clarity on that because it is critically important that we know what the Government intends doing? The industry and society deserve an honest appraisal of what it intends to do with regard to universal health insurance. If it was committed to the fictional universal health insurance model it espoused prior to the election, we would not be discussing community lifetime rating at all because everybody would have to take out health insurance. This Bill seems to accept that we will not be going down the road of universal health insurance. How we fund our health services and provide the care that is required every day is critically important to the insurers, to those who wish to take out private health insurance and to others who cannot afford it or have an ideological objection to it so that they can make up their own minds. How we fund health services in the years ahead is central to our debate. It is evident from the context and content of this Bill that the Government is slowly but surely abandoning its universal health insurance model.

Significant resources were spent on that approach, for example, when people were sent abroad to examine the various models that are in place throughout the world. There was a commitment to publish a White Paper on universal health insurance. We were told there would be a consultative process.

I assume the Bill before the House is an indication that this policy is being abandoned. The reason it is being abandoned is very clear, to be political on this matter for a moment. Fine Gael has clearly made a calculated decision. It has realised that if it pursued the universal health insurance model espoused by the previous Minister for Health, it would be asking its supporters to pay their taxes and private health insurance premiums before being informed when the health insurance model came into being that everybody was on the same list together. Obviously, Fine Gael's supporters would not accept that. I assume the universal health insurance model is slowly being abandoned because it would not offer preferential treatment to people with private health insurance.

That is an original theory.

It is not; it is a very factual theory. If the universal health insurance model was the panacea for all the difficulties and challenges associated with the funding of health care, Fine Gael would be going full steam ahead with it.

I am sure the Deputy does not think that all of our supporters have private health insurance.

If universal health insurance was the utopian model, as we were being led to believe, I see no reason that the Government would not be moving full steam ahead with it. The contrary is the case in terms of the Minister's commitment to universal health insurance. It has actually been dropped from his lexicon and his vocabulary. He never speaks about it anymore. Instead, he speaks about universal health care. There is a fundamental difference between care and insurance, in terms of how we fund the health services in the years ahead. We will continue to pursue this issue to find out exactly what is the position of Fine Gael and the Government as a whole on the universal health insurance model that was proposed in the programme for Government.

Any society would judge itself on how it looks after those who are most vulnerable and most in need of our support. The Minister's party has had a latter-day conversion to the risk equalisation model, which is a critically important component in ensuring we have a vibrant health insurance market. More importantly, it helps to ensure people are not penalised as they get older and sicker and therefore have a greater need to draw on health insurance. A central tenet of any modern society is to ensure people are not penalised as they grow old. We should not uphold this tenet because it makes us feel better - we should do so because the people in question deserve it. They have served this country well. Many of them have been paying private health insurance for many years. The idea that they should be penalised as they grow older is simply unacceptable. That is why my party has always supported the concept of risk equalisation. If I wanted to look at how it evolved, I would mention that the opposition to it in this House was quite dramatic for many years. We were led to believe it would force families to abandon health insurance. Of course if there was no risk equalisation, older people would be forced to abandon private health insurance. That is the concept we endorsed and put through. Thankfully, most parties now agree to that very civilised principle.

Reference has been made to the impact of the Australian model of lifetime community rating in that country. I think it is a good idea. We called for it for a long time. It is quite clear and evident that since 2008 there has been a steady decline in the number of people taking out private health insurance. The primary age cohort that has been dropping out of health insurance comprises those under the age of 35. To put it simply, as the number of people taking out private health insurance has been decreasing, the burden that needs to be carried has been falling on fewer and fewer people. As a result, the spiralling cost of private health insurance has further exacerbated the problem of people dropping out of such insurance.

Government policies that added dramatically to the cost of private health insurance are a hidden part of this problem. The Minister said in his speech that "these measures, combined with the recent decision by my colleague, the Minister for Finance, not to decrease tax relief on health insurance premia and the freezing of hospital bed charges, all aim to support a competitive health insurance industry". That seems to be an indication that the policies pursued by the Government when it capped the tax relief on premiums and its policies with regard to hospital beds did not add to the competitiveness of the market. If the Government wanted a more competitive market, it should be going further by rowing back on the decisions it has made to date.

There is no doubt that last year's decision to cap tax relief was announced without consultation. The previous Minister for Health looked quite shocked when the Minister for Finance announced in this Chamber that he intended to cap tax relief on gold-plated health insurance premiums. By any stretch of the imagination, the measure that was introduced was not confined to gold-plated premiums. I think there is now an acknowledgement that the average premiums which families try to maintain on a yearly basis were also affected. Hundreds of thousands of people were directly affected by the increased cost that was imposed on health insurance premiums.

Many people are making great efforts on a continual basis to provide for their own health cover. Obviously, there are ideological arguments inside and outside this House about whether private health insurance is acceptable. When we consider whether it is right that private health insurance forms part of how we fund our health services, we must admit that people who take out such insurance are doing the State a service. They are alleviating the burden on the State, which is obliged under legislation to provide health care for everybody. People are willing to forgo certain luxuries, or have no luxuries at all, and to make huge sacrifices in order to pay for private health insurance. I find the idea that it is somehow wrong for them to do that very distasteful.

We have the system that we have. Following the abandonment of the universal health insurance model, it looks like we will have it for a while. Therefore, we should encourage people to take out private health insurance. We should not penalise them. This Government has consistently penalised ordinary families when they take out private health insurance. As I have said, last year's budget, which was a direct attack on families that pay private health insurance, is a case in point. We need to make it clear that if everybody decided to withdraw from private health insurance, the public health system would be lumbered with the cost and would, in effect, collapse as a result. Private health insurers pay out €1.8 billion in respect of health care each year. If that money was no longer available, the Government would have to put an equivalent amount of extra capacity into the public health system. Everybody should accept that the public system simply could not cope in such circumstances.

The attraction into private health insurance of young people must be a critical component of any effort to develop a sustainable private health insurance market. Competition, encouragement and social and intergenerational solidarity must also be features of such a market. We need to make sure the young subsidise the old. This straightforward and simple concept should be encouraged rather than discouraged. It has been quite evident for the last three or four years that something needs to be done to stimulate the uptake of private health insurance among younger people. Nothing has been done for a number of years.

We are now very much in a crisis situation. The age profile of people in private health insurance is exceptionally worrying. As I have said, the burden is falling on older people to subsidise older people. That is simply not sustainable. I hope this legislation will address this key area, which needs to be addressed. The prevarication that continued for three and a half years, when there was a pretence that universal health insurance would be introduced, has come to an end. The introduction of this legislation is, in effect, an admission that the Government is not going to go down the road of universal health insurance. The problem is that the unsustainable model which prevailed in recent years discouraged young people from coming into the health insurance market.

I would like to comment on the age structure of the market. There has been a significant ageing of the insured population. In 2003, the percentage of the insured population over the age of 60 was 13.3%, but this had increased to 19% by the second half of 2012. There has been a dramatic increase in the age profile of the insured.

If it is not underpinned by a continuous flow of younger people into the market, the sustainability of same is undermined.

The Minister referred to the advice of the Health Insurance Authority, HIA. That he has taken it on board is a welcome departure. The previous Minister for Health never took the HIA's advice. He continually dismissed logical advice on how to contain the cost of private health insurance for families and how to ensure a basic model of risk equalisation, which was important for social and intergenerational solidarity.

For all of the reasons I have listed, trying to provide cover proved difficult for families. The increases in premiums ranged from 7.3% in 2011 to 12.1% in 2012. In 2008, the average premium per insured person was €729. In 2013, it was €1,250, representing a dramatic increase in the cost of health insurance. There are many reasons for this, but Government policy and its neglect of the private insurance sector have been contributory factors. Introducing the instability of not knowing whether people would need to take out mandatory health insurance undermined people's initiative to join. Why would anyone have taken out health insurance in recent years if stated Government policy was to force people to do so in 2018 or thereabouts? In such circumstances, it was illogical to believe that anyone would take out insurance for the next six years. Thanks to the Government's policy, we are still in a vacuum. Sometimes, its policy may be at variance with the Minister's policy, but we need to know what the Government intends to do with universal health insurance. That insurance would be compulsory in a couple of years' time contributed to young people in particular not taking out insurance of their own. This Bill is an indication that the situation may be changing.

Health insurers and providers have an obligation to try to curtail costs. Much work remains to be done in this regard. There will be occasional clinical audits of payments, but people still hold the view that the level of service increases above what is necessary once a private health insurance card is shown. People are concerned about supplier-induced demand. We must aggressively ensure that an auditing system to prevent this is in place. We do not want clinicians and other medical professionals to cut corners, but people must not be incentivised to provide unnecessary diagnostics or other forms of care just because patients have private health insurance. That the system might contain such incentives is wrong, including ethically. The Minister should consider this matter.

In September 2013, VHI insured 54% of the market, Laya insured 23%, Aviva insured 15% and GloHealth insured 4%. One could argue that it is competition that will sustain the market, in that insurers and health service providers will compete with one another to get market share, but I wonder whether that is really the case. We have a dominant insurer in VHI. In terms of the cost of care for private patients, I wonder whether service providers are negotiated with aggressively. This matter should be also considered. Private health service providers are under financial pressure, but an upturn in the economy, more people entering the market and proper clinical auditing of treatments might help.

Turning to the question of how we will fund the health service in the years ahead, the Minister and others have often accused me of not having a determined health policy. Whenever I open the pages of a newspaper, though, the Government seems to be reverting to the policies that we would have pursued, namely, a publicly funded health system with the option of private health insurance. Pitting one against the other or removing private insurance entirely would disadvantage others. If no one took out private insurance, we would all be disadvantaged because the public health system would not be able to support everyone. It is fine if people take out private health insurance and the insurer has a contract with a health service provider, but the difficulty with this is that the public health system is underfunded. There is no point in trying to deny it. Consider the recent and alarming figures detailing the number of people awaiting inpatient and outpatient appointments. That the previous Minister scrapped the National Treatment Purchase Fund, NTPF, and pretended that the special delivery unit alone would address the underlying issue, namely, the capacity of the public health system to deal with the throughput, was farcical. This must be realised at some stage.

A patient who is in the public system should not be penalised by having to wait for a long time. If the public health system does not have sufficient capacity to ensure this, the patient's care should be contracted out to a private provider. This is not an irrational thought. It worked well in the case of the NTPF. There is no reason that the fund cannot be resumed. Under its guidelines, if someone was waiting for a certain period of time and the public health system could not deal with him or her, the patient's care was contracted out to a private provider. People were dealt with in a timely fashion.

In the tail end of 2014, we have reached crisis point. We are awaiting publication of the HSE's service plan for 2015. The figures are alarming. Judging by the amounts announced in the budget, the public health system will not be able to deal with those figures in 2015 alone. Something will have to be done to alleviate the pressure of patients who wait inordinate and unacceptable lengths of time for procedures.

Those in the public system see private insurance policyholders receiving treatment quickly. This is unfair, but it is not the fault of the private insurers. Nor is it the fault of families that, having worked hard and saved money, take out private health insurance. The unfairness lies in the State's failure to provide adequate resources to the public hospital system. We should not demonise people who slave continuously to retain their private health insurance for "jumping the queue".

It is the public health system, because of the lack of funding, that is delaying people's timely and speedy access to diagnostics and to care. This is where the fault lies and I reiterate that Fianna Fáil intended to go for a seismic shift over to a new system of funding the health services. Everybody would be assessed in a timely manner and everybody would get treatment based on their clinical need. However, the same principle should apply as it is. People should get their treatment based on their clinical need and if one is a public patient, one is entitled to treatment as quickly as a person who has private health insurance. The delay is not the fault of the person who takes out private health cover. The delay and the fault is with the Minister, the Government and the Health Service Executive, HSE, in providing sufficient resources to ensure that public patients are not waiting an inordinate length of time. Members would then not be having this debate because the system would be fair and equitable in the sense of access to health care, be it public or private, in a timely manner. This is the Minister's difficulty.

Obviously, on the broader issue of the insurance market itself, Fianna Fáil also examined some of the insurance models and while we did not send off teams of officials to examine the various models, we were able to get information from around the place and universal health insurance is far from being a utopian model. The Minister should fight tooth and nail for adequate funding and resources to be put in place to ensure the public hospital system has the resources to deal with patients in a timely manner. If this means being obliged to transfer some of them into the care of private health service providers, this should not be a difficulty. I note this is being done on an ad hoc basis and from time to time is done in a panic mode. The pressure comes on, waiting lists lengthen and the special delivery unit then makes a few telephone calls and acquires treatment. However, what really should be done is to put in place a proper structure whereby the State, through the HSE, could put out to tender a number of procedures in areas such as orthopaedics and ophthalmology or whatever are the areas in which there are inordinate waiting times. That work should be contracted out in order that people are dealt with quickly, effectively and in a timely manner. I am quite definite that in terms of value for money, this approach is worth re-examining because regardless of whether people had an ideological objection to it or otherwise, the National Treatment Purchase Fund was addressing the waiting lists. It was able to refer people into private health care in a timely manner and that capacity in the private hospital system has grown in recent years with the opening of other facilities. I assure the Minister that nobody minds where they are treated, albeit not in the geographical sense but in the context of public versus private, as long as they are treated quickly, efficiently and in a timely manner in a safe environment. This point should be reiterated through all Government policy in the short to medium term.

Thereafter, in the run up to the next general election, Members will have a broader debate on how the health services will be funded in the years ahead because the people have a right to know. The people in general have a right to know what precisely the Government intends to do. This will take into account both the funding of the health services and broader taxation policy, the question of who will pay, how it will be paid and who will own the health service. As matters stand at present, I am unsure who will be the final arbitrators in the delivery of health care in Ireland. If one goes down the universal health insurance model, coupled with the hospital groupings themselves in a scenario in which they are all bidding and tendering against one another, it quickly will become evident that the insurers will be the ones that will dictate the amount of care provided to people. The Minister can talk about all the baskets he likes in the context of universal health insurance cover but financial realities will dictate quickly. This has happened in the Netherlands and elsewhere where the various fruits slowly were taken from the baskets and only extremely basic cover was left. If one then broadens this out to the issue of primary care, I note it is under huge pressure in some countries that have the model until recently was being espoused or promoted.

Overall, Fianna Fáil welcomes this Bill. It is urgent because the prevarication over the past three years has meant there has been a weakening of the health insurance market in terms of the age profile of those taking out private health insurance. One cannot sustain a position in which one now is asking older people to support older people, as was the case with regard to the age profile of those who had private health insurance and the fact that nobody was being encouraged into the market for many reasons. I accept the downturn in the economy obviously had an impact on the number of people taking out health cover. However, there also was no incentivisation and with the other issue of compulsory health insurance hanging over people's heads, there was no incentive for people to even consider private health insurance. For all these reasons, I would appreciate an expeditious passage of this Bill to ensure that Government policy retains a vibrant health insurance market and does not overburden it with costs, as has been the case with the policy decisions of the Minister for Finance and the previous Minister for Health, which lumbered additional funding costs onto those who already were hard pressed. More importantly, Members must get a clear and concise statement from the Minister or somebody in government outlining precisely whether the Government intends to proceed with the pretence of a universal health insurance model or whether Members will revert to having a genuine discussion on how the health services will be funded in the years ahead.

Arís eile, tá Bille os ár gcomhair a dhéanann iarracht fadhbanna an chórais sláinte a leigheas. Is oth liom a rá go mbaineann an Bille seo le hathrú beag a dhéanamh ar an gcóras seo, a bhfuil dhá léibhéal ann - léibhéal amháin dóibh siúd a bhfuil airgead acu agus léibhéal eile dóibh siúd nach bhfuil airgead acu.

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 also is 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 in itself is a tragedy.

As I have stated previously on this issue, 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. 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 to those who carry heavier risk burdens. All this requires regulation, monitoring and enforcement, as provided for in this Bill. Without such legislation, the unregulated market would discriminate against the old, the sick or any other group or individuals which insurance companies decided were a greater risk. The legislation therefore is 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 between the healthy and the sick. This is welcome, in so far as it goes.

However, we in Sinn Féin would go much further in extending the principle of solidarity to the way the entire health care system is funded, organised, structured and managed and I will return to this point later.

Debate adjourned.