Health insurance: ‘It is all about what you need and the price you are paying’

Examine your plan’s benefits and see if there are any cheaper options

Laura Brien of the Health Insurance Authority says that although prices have gone up over recent years for many policies, their level of cover has changed, often to consumers’ detriment. Photograph: iStock

Laura Brien of the Health Insurance Authority says that although prices have gone up over recent years for many policies, their level of cover has changed, often to consumers’ detriment. Photograph: iStock

 

One of the first places that people in search of better value health insurance go to is the Health Insurance Authority’s website hia.ie, an organisation headed up by Laura Brien.

She says recent research suggests that about one-third of those with private health insurance have switched although most have made the switch only once and says that while the numbers switching have increased, the increase is a “slow burner” rather than anything more dramatic.

“People are worried more about what they might lose rather than thinking about what they might gain,” she says. “They are concerned that if they switch, they might lose access to certain hospitals or consultants or not have the same level of cover that they previously had.

“People think that waiting periods start again if they switch but that is not the case,” she says.

If a person has a certain level of cover with one company and they switch companies or to a different policy with their existing company, waiting periods apply only for any enhanced cover offered by their new policy. They do not apply to any cover that was offered by their previous policy.

That means that if a person has 90 per cent cover for cardiac care with a particular policy and switch to a policy that has 100 per cent cover for cardiac care, they will continue to have 90 per cent cover for that care from the moment they switch but will have to wait a set period before the benefit of the additional 10 per cent cover kicks in.

While she says she is agnostic about people choosing company A over company B or company C, she is evangelical about “ensuring people are able to get the best level of cover at the most affordable price. It is all about looking at the cover you have and asking if you are getting what you need for the price you are paying,” she says.

She says that not only have prices gone up over recent years for many policies but the level of cover offered by those policies has changed.

“It is a cumulative thing that happens over time,” she says. “The biggest thing we have seen is the excesses increasing and that can be to the detriment of the consumer. If a 10 per cent excess on a policy goes up to 20 per cent, then that can amount to big money for someone if they fall ill. That is where the biggest differences in the level of cover is happening.”

People over the age of 65 pay 34 per cent more for their cover than younger people

She highlights how companies tend to focus all of their marketing and advertising at younger more profitable cohorts. “If you look at a health insurance ad, do you ever see someone over 65 or do you ever see an image of an ambulance outside someone’s house? No, it is always ads featuring young healthy people or families playing with their children in the playground. The companies are advertising to younger people because they make more money from them.”

Brien says that people over the age of 65 pay 34 per cent more for their cover than younger people. She says some of this is because older people seek more cover which costs more but it is also because “they have been on the same plans for many years”.

The companies have rolled out multiple price increases in recent years blaming medical inflation and the higher cost of improved treatments.

“Not all plans are going up by the same amounts and we have seen price increases of 2-3 per cent on some lower cost plans while the higher end plans are going up by more than 6 per cent,” she says.

“People need to look at the benefits of their plans and see if there are any comparable plans that cost less.”

Brien says there are things that have pushed up costs including the Covid response across the healthcare sector as well as advances in technology and drugs but suggests that “at the same time certain practices have changed because of Covid and you would expect they would lead to costs going down. For example, hospitals are more interested in getting people in and out fast so instead of spending five nights in hospital, patients might be spending four and there are more day cases because people do not want to spend that extra time in hospital.”

She also points to a lack of “competitive pressure” across the private hospital sector.

“Even if three new private hospitals were to open tomorrow, they would be full at almost any price point so there is not a lot of competitive pressure and there is unlikely to be unless there is excess capacity.”

She points to Covid which has seen capacity in private hospitals reduced and cites the example of the Netherlands where almost everyone has private health insurers while less than 50 per cent of Irish adults have private policies. “Here the companies are focused on bringing more people into the market whereas in the Netherlands the focus is on beating up the suppliers on price.”

Other options

Not everyone wants or can afford health insurance and there are other options. One of them is Vigo Health, an Irish company set up last year to address a gap in the private everyday health market through a combination of strong digital healthcare and cash benefits.

The company says it is designed for people under the age of 40 who don’t have hospital insurance.

Chief executive Ruth Bailey says that for less than €10 a week people can get access to digital healthcare options including virtual and WhatsApp consultations with nurses, doctors, as well as physio and mental health professionals. It also offers full cover for MRI and CT scans as well as two visits to a minor injury clinic.

There is also up to €300 a year for blood tests and X-rays and up to €500 a year for consultant visits. It does not cover hospital stays.

“We don’t want to compare ourselves to hospital health insurance and it is not a replacement for that,” she says. “The market we are looking at is the 25-35s. The under-25s are more likely to be on their parents’ policies or just don’t care while the over-35s’ lifetime community rating kicks in.”

She says that just because this cohort are not buying health insurance “does not mean they have hospital needs on an outpatient basis. And with this you have the flexibility of getting everyday costs and access to fast diagnosis.”