Denis Naughten TD, will this evening (Tuesday) seek to force the hand of the Minister for Health to introduce a lifetime community rating measure on health insurance policies which will help to reduce the cost facing many families at present. Naughten’s amendment would force the Health Minister to act upon legislation introduced in 2001 to facilitate the introduction lifetime community rating, which insurers and Health Insurance Authority agree is the only mechanism to reduce the cost of health insurance.
Naughten explained: “As the health insurance system in this country currently operates, it cannot survive without young people joining up, but there is no incentive for a young person to take out, and maintain health insurance policies other than a fear that he or she may get sick. Consequently, the 80,000 people who are set to leave the health insurance system this year are mainly young families struggling to meet bills, due to the rapidly rising cost. While at the same time, people over the age of 60 are signing up for health insurance.”
These trends clearly indicate that only those who rely on health insurance and the wealthy will remain within the system in the coming years unless immediate action is taken to curb the haemorrhage of the young. If this pattern is allowed to continue, then many more families will be forced out of the health insurance system, thus pushing up the cost even further for people left with insurance. And many of those may decide that they will take the risk of leaving the system and instead wait for the introduction of the Government’s promised universal health insurance in the second half of this decade.
However, without curbing the current decline in health insurance membership, the future of a universal model is increasingly uncertain. Naughten explained: “Such is the withdrawal of numbers from the health insurance system that it will be near impossible to introduce universal health insurance within the timeline envisaged by Government. The Dutch universal health insurance system was introduced at a time when close to 90% of the population had health insurance cover; at present rates we’ll have less than half that in Ireland by the time it is introduced here”.
A lifetime community rating would decrease this decline by ensuring that those who take out health insurance earlier in life are rewarded in the long term. Effectively, a 60 year old person who took out health insurance at 25 pays the same as a 25 year old, but a 60 year old who took out health insurance at 55 would pay more to allow for the fact that he or she did not make the contributions when he or she was younger. Naughten concluded by saying “this would maintain possibility of introducing universal health insurance in the long term, while driving down premiums in the interim.”