82,000 forced to cancel health cover

MORE than 14,000 people have been forced to cancel their inpatient hospital health insurance cover in the first three months of this year as the economic crisis tightens its grip.

Since the recession began, 82,000 people have had to make the same difficult decision.

Figures from independent watchdog the Health Insurance Authority (HIA) show people are continuing to quit the market in droves — putting yet more pressure on public health services.

In its latest update on the sector, the HIA has confirmed that 14,000 customers cancelled their inpatient hospital cover in the first quarter of 2011, as they were forced to choose between paying household bills or affording the vital protection.

The rate of cancellation — the majority from VHI — is one of the highest quarterly totals since the economic crisis began. In total, 82,000 people have left the specific health insurance area since December 2008.

Speaking to the Irish Examiner, a HIA spokesperson said that while the slump is partially linked to the fact that policies are generally renewed at the start of every year, repeatedly rising costs, coupled with falling salaries, are key factors in the decline in cover.

In the past two years, VHI has raised average premium rates by 23% (2009) and 15%-45% dependent on policy details (November 2010).

Aviva Health Insurance increased premium rates by 14% from March 1, 2011, following its April 2010 move to raise family plan costs by €40 per year.

Quinn Healthcare raised average premium costs by 15% (January 2010), 7.9% (January 2011) and 6% (April 1, 2011) — a move it blamed on the Government’s “stealth tax” levy.

The Government’s health insurance levy costs an additional €205 per adult and €66 per child every year.

A spokesperson for VHI said it expects the health insurance market to “shrink further in 2011”, a situation it said is “inevitable given the economic climate”.

However, despite predicting further cancellations, VHI — which lost 162,000 customers in 2009 and 2010 — declined to rule out yet another cost increase on the back of the latest setback.

Quinn said its customer levels stayed “broadly the same” between the fourth quarter of 2010 and the first quarter of this year, while Aviva said its customer base grew between January and March.

Social Justice Ireland director Dr Seán Healy said the continuing exodus from private health insurance is further evidence that the two-tier health system fails to help those most in need.

He added that people will continue to quit their insurance policies because they are struggling to pay more pressing bills, a “vicious circle” scenario that will result in further premium cost rises for those who keep their coverage and yet more pressure on public hospital services.

Consumer Association of Ireland chief executive Dermot Jewell restated his call for Health Minister Dr James Reilly to address the insurance cost problems facing members of the public.

Mr Jewell, who made a similar call after price hikes were announced in March, said it is “clearly impossible for many people to pay for any type of cover”.

He added that the lack of any real competition in the health insurance market is putting patients at significant risk as growing numbers face the prospect of a lack of immediate access to care.