I will pick up where I left off last week when I spoke on the Bill. This is an annual event which involves the House giving its approval to continue with technical arrangements for the private health insurance system. The legislation is introduced annually to make adjustments to the risk equalisation scheme in respect of stamp duty levies, risk equalisation credits and hospital utilisation credit rates.
Private health insurance is regulated by the Health Insurance Authority and it is on its recommendation that these annual proposals are made. They are generally nodded through on the basis that there is general support for the principle of risk equalisation. Risk equalisation is an important element of private health insurance which prevents cherry-picking in the health insurance system. This is especially the case given the history of the health insurance system in this country where the VHI had the field to itself, more or less, for many decades. For this reason, the company has a disproportionate number of older members and it would be unfair to allow new entrants into the market which could cherry-pick younger and healthier clients or customers. That is the purpose of risk equalisation and it difficult to argue against the scheme. The new arrangements and rates will apply from 1 April 2018.
The legislation also makes amendments to the lifetime community rating scheme to extend the powers of the Minister in that regard. It proposes that the 2% loading for people aged over 35 years, which was introduced a couple of years ago, be modified to some extent and that the 2% annual loading be limited to a maximum of ten years.
This is clearly highly technical legislation. I am concerned, however, that some of the proposals regarding the lifetime community scheme are not entirely clear. Reference is made to a negative impact for older policyholders, which would affect the VHI in particular. I hope, although it is not entirely clear from the text, that it will not result in an appreciable increase in the cost of policies for older people because the cost of private health insurance has increased substantially in recent years and reached a point where it is unaffordable for many people.
Obviously, over recent years, many gave it up. During the austerity years, the level of cover went down to its lowest and it is gradually creeping up again, with 46% of people currently having it. As I said to the Minister last week, I would see this 46% who feel that they must have private health insurance out of fear and out of a lack of confidence in the public health system as a serious indictment of the health system. This is unheard of in most other European countries. Generally, in European countries, people have access to an affordable public health system that is generally free or almost free at the point of use and that is the kind of system we should have in this country. It is the kind of system that Irish people should be entitled to. Unfortunately, we are in a situation where nearly half the population feel they must fork out for very expensive insurance.
I spoke last week about the average premium. I do not accept the average premium figures provided. The average premium for a person over 50 on the basic plan B is €2,000 this year. It had been €1,500 last year. That has to be seen for what it is. It is essentially another tax for people. It is an additional tax of €38 a week or €167 per month to buy private health insurance. If the recent budget had announced the introduction of new taxes of €167 a month, the Government would be laughed out of it, but somehow people seem to think it is all right to put this kind of charge or tax on people just to access basic health cover. Of course, what people get from the basic plan B is basic health cover. It really only enables people to skip the queue and jump ahead of others who do not have private health insurance when it comes to elective surgery.
By and large, the health insurance policies that are available in this country give poor value for money. In addition to paying that €2,000 a year for private health insurance, people are also caught with paying usually the full cost of a GP. A consultant can cost €220 and a person enjoys little cover from his or her health insurance for that. Private health insurance does not cover medicines. In the main, it does not cover any diagnostics. It also does not cover emergency department access. No doubt people are being ripped off. They are faced with this considerable additional bill just so that they can have some peace of mind that if they have an emergency, or not so much have an emergency but need elective surgery, they will be able to access that in a timely way.
As I said, we are having the wrong debate here. The debate we need to be having is how we move from the current dysfunctional, unfair, inequitable and inefficient two-tier health system to a single-tier public health system comparable to most other countries. That is what all of the emphasis should be on at this point. If the Minister ever needed proof that the present system is so wrong, all he need do is look at the "RTÉ Investigates" programme to see the kind of carry-on there and the blatant abuse of the two-tier system. I suppose events have overtaken that shocking programme but we still need answers to what Deputy Harris, as Minister, will do about the revelations shown in that programme. At the recent Joint Committee on Health, the Minister spoke about pursing the cases that were highlighted in that programme, but of course the fact is that this is a systemic problem in many parts of the country, in particular in hospitals. I will undertake to send on to the Minister tomorrow details of that information that was drawn up by the "RTÉ Investigates" programme.
