Health insurance - €160 levy dressed up as tax relief

The Government announced that it would provide increased tax relief for private health insurance premiums for everyone over 50 years of age.

The scheme is being introduced as a substitute for the risk equalisation plan that was struck down by the Supreme Court. It was also necessary, because of the budget decision to increase charges for private beds by 20%, along with medical inflation.

Health Minister Mary Harney said these changes are necessary because older people would effectively face significantly higher premiums, possibly up by over 60%. This was a scenario that the Government could not support, because it would mean that many older people could not afford health insurance.