People who wait until they are over 30 years of age to take out private health insurance should have to pay a "late-entry loading", according to the independent statutory body established to regulate Ireland's private health insurance market.
The Health Insurance Authority (HIA) said yesterday it had made a submission to the Minister for Health, Mr Martin, on the proposal and was hoping to initiate discussions with him shortly.
Mr Dermot Ryan, chief executive of the HIA, said late entry loading was in operation in Austria, and under its system consumers paid extra for every year over 30 they were when they took out insurance.
He said the Irish health insurance market is underpinned by inter-generational solidarity under which young subscribers are subsidising older policy- holders and they are themselves subsidised when they get older by the next generation of young subscribers. To protect that system it would be "prudent" to introduce late-entry loading, he said. At present, people who take out insurance at age 55 for example do not pay extra, but they have to wait longer before being able to claim benefits.
Meanwhile the main health insurers in the Irish market, the VHI and Bupa, have until Friday to make their first returns to the HIA detailing the breakdown of the age of members and claims they made for the final six months of last year.
This data will be used to calculate the difference in risk profiles between members of both and if it is between 2 and 10 per cent, the HIA will have to make a decision on whether or not risk equalisation should be introduced.
Risk equalisation is a process that aims to equitably neutralise differences in insurers' costs that arise due to variations in the health status of their members. It results in cash transfers from insurers with lower risk members to insurers with higher risk members. The VHI says it has more older members and therefore higher costs and it wants risk equalisation. Bupa is resisting.
Mr Ryan's comments came at a media briefing following the publication of a report comparing the products on offer by the VHI and Bupa. Mr Ryan said he could not advice consumers on which product was best. It was up to consumers to make up their own minds, he said. These can be viewed on the HIA website at www.hia.ie