by Susan Mitchell, Sunday Business Post

Health insurers are actively examining the introduction of private hospital-only insurance policies in response to recent announcements in the budget.

VHI Healthcare, Quinn Healthcare and Aviva confirmed they had begun to look at private hospital-only policies, a move that would have significant repercussions for the healthcare sector.

At present, only 20 per cent of beds in public hospitals are deemed private or semi-private and therefore chargeable. The Minister for Health, James Reilly, has proposed ending the system of formally designating private beds in public hospitals, and allowing them to charge for all privately-insured patients. The Department of Health hopes to raise €75 million from this measure, next year .

Health insurers have warned that the move could have colossal cost implications. It is largely this measure that led the VHI to estimate that premiums would have to rise by 50 per cent.

The VHI said average in-patient costs in private hospitals had fallen by 6 per cent since 2009, whereas prices in the public sector had increased by 21 per cent. Health insurers were not paying the full economic cost of those private beds in public hospitals, but will be doing so from January, when the cost will increase by 4 per cent.

Reilly has dismissed claims that price hikes of 50 per cent would be levied on consumers, but there is disquiet in Fine Gael about the proposal.

Patrick Brennan
Director of Corporate Business
Irish Health Insurance

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