Hundreds of thousands of health insurance customers are facing a hike in the cost of their premiums as VHI raises its prices for the second time in six months.
The company said the increase, which will be an average of 2 per cent from from May 1st, was necessary to cover the costs of new technologies, drugs and procedures as well as rising claims costs in public hospitals.
State-owned VHI is the Republic’s largest health insurer and has more than 1 million customers. A company spokeswoman said most customers will face an increase of some sort. The insurer last increased prices by 3 per cent in November.
VHI director of marketing and business development Declan Moran said the organisation has "worked hard" to keep the price increase as low as possible.
“But [we]need to ensure that our plans continue to deliver new and innovative benefits to our customers,” he said.
“Our commitment to our customers is that we will continue to deliver health insurance plans that are relevant to their needs and provide them with access to the latest drugs and treatments while striving to keep those plans affordable.”
In examples set out on Thursday, VHI said the cost of its “One-Plan Family” scheme covering two adults and two children will increase to €3071.60 a year from May - a monthly rise of €7.06.
The company said the cost of its “Start Plan” for adults will increase by 78 cent per month, bringing the annual cost to €474.01.
The “One Plan Starter” will increase by 79 cent per month, bringing the annual cost to €570.70.
Furthermore, the cost of the “One-Plan 250” scheme will rise by €2.27 a month, bringing the annual cost to €916.44.
In September, the company said the private health insurance model currently operated in the Republic will be unsustainable in the years ahead due to the surging cost of claims from an ageing population.
It forecast that the cost of claims in the overall market will rise by about 80 per cent to €3.4 billion by 2025.
In a submission to an Oireachtas committee examining the future of the health service in Ireland, VHI said it was difficult to see how the health insurance market could withstand such additional costs.
“The private medical insurance market is already seeing significant numbers of customers downgrading their cover, with many cancelling their private medical insurance policies due to financial constraints,” it said.