SIPTU chief urges Govt to stand firm against Bupa

The Government should enforce new rules in the health insurance business despite insurers threatening to pull out of the market, it was urged today.

Joe O’Flynn, SIPTU’s general secretary, criticised the insurer, Bupa, which has said it may move from the Irish market if risk equalisation provisions are introduced.

Under risk equalisation rules, the British-based multinational would have to compensate VHI because the state insurer has older and higher-risk members.

“The risk equalisation principle is specifically intended to prevent one insurance company cherry-picking the younger and generally healthier sectors of the population and leaving older and more vulnerable sectors without cover,” Mr O’Flynn said.

“In terms of public policy, it is a positive and progressive principle.”

The new risk equalisation measure is based on people paying the same price for the same level of health cover regardless of their age and well-being.

Insurance companies with large numbers of low-risk younger customers must pass on some of their profits to businesses with high-risk people on their books.

Bupa said in a leaked submission to the Health Insurance Authority (HIA) regulator that that risk equalisation – which could cost it up to €30m a year in payments to other companies – would “force” it out of the Irish market.

The HIA has submitted a report to Health Minister Mary Harney on risk equalisation and she must shortly make a decision on the matter.

Mr O’Flynn said: “Bupa was fully aware of this principle when they entered the market. It has done very lucrative business since entering the market.

“It should accept the rules of the game. The Minister for Health should ensure that the rules are enforced.”

He added: “If Bupa succeeds in bullying the minister into acquiescence, then in a very short time, it will become impossible to secure health insurance for anybody over 45 except at an astronomical cost.”