210 health insurance policies cancelled per day

Almost 210 private health insurance policies are being cancelled every day.

It is primarily younger, healthier people who are discontinuing their policies. Last year, the daily cancellation average was 175 policies.

Latest quarterly figures, for April to June, show 19,000 health insurance policies had been cancelled. Overall, about 64,000 individuals or families gave up their private insurance over the previous 12 months.

At the end of June, there were 2,059,000 people covered by in-patient health insurance plans, according to latest figures from the Health Insurance Authority.

The market peaked at 2.3m people insured at the end of 2008 but has fallen every year since.

At the end of Dec 2009, there were 2,260,000 people with private insurance in-patient plans, 2,228,000 in 2010, and 2,163,000 in 2011.

Based on Central Statistics Office population estimates for April 2012, 44.9% of the population have in-patient health insurance plans, down from the 2008 peak of 50.9%.

Dermot Goode of healthinsurancesavings.ie said he expected up to 75,000 people could end up canceling their cover this year.

“What this shows is the trend of the younger, healthier people leaving the marketplace, and it also show no signs of abating whatsoever,” he said.

Mr Goode said those who thought things were OK because more than 2m people had private health insurance were missing the point. “The people who are leaving are the young, health members who are aged between 24 and 35 predominantly, and they are the people who don’t claim,” he said.

Mr Goode said community rating was premised on a steady influx of younger, healthier members subsidising older ones. He believed Ireland’s insurance model was now under serious threat because there was an exodus of the younger, healthier people instead of a steady influx.

Mr Goode said more health insurance price increases could be expected in October or November in the order of 5-8% with insurance companies wanting to get a small financial boost at the start of 2014 when around a quarter of holders are expected to renew their policies.

“I have some sympathy for insurance companies — they are trying to pass on a price increase that covers their additional claims exposure but, at the same time, doesn’t push thousands more over the edge of terms of affordability.”

New lower cost plans have just been released by Aviva Health, VHI Healthcare and Laya Healthcare, covering a restricted list of public and private hospitals in a bid to encourage people to maintain some level of health cover.

Mr Goode said the new plans signalled the days of being covered for all public and private hospitals were now gone. “People need to know that if they reduce their cover and subsequently increase it, the increased cover will not apply for at least two years for any existing condition,” he added.