Everything you need to know about your health insurance policy

Is it true my health insurance company is giving me my money back?

Yes, at least partially. The VHI, Laya Healthcare and Irish Life Health have all confirmed that policy holders will be getting refunds in the weeks ahead as a result of the Government's effective takeover of the State's private hospitals.

Remind me again why that happened?

Last month, as the Government readied itself for the coronavirus “surge”, it reached an agreement with 19 private hospitals to effectively take control of them in order to provide additional capacity to the public as the number of people with Covid-19 grew. The move meant that almost overnight an estimated 2,000 beds become available to the HSE at a time when the public system was facing a potential major surge of patients ill with the virus. The deal is going to cost the HSE around €115 million a month.

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So what am I paying my private health insurance for now then?

That is a question many people have asked as the move did mean many of the elements of the private health care system which they were paying for are now unavailable. There will continue to be some parts of the private healthcare system operating in the coming days, such as maternity and psychiatric care, but for the months ahead the scale of what is on offer in the private health market will be dramatically reduced for the greater good.

So, why don’t I just cancel my policy now and start it again when things are back to normal?

That would be a bad idea and could leave you without cover for many things for a long time into the future. Under long-standing rules governing health insurance in Ireland a person who lets their policy lapse for 90 days or more is considered as a new entrant to the market when they take out a new policy. That means waiting periods of up to a year apply before any claims will be entertained while a person with a pre-existing condition may have to wait up to five years before they will be able to make a claim for treatments for that particular condition.

How much am I paying for health insurance anyway?

That depends on the policy you have their are more than 300 policies on the market and range in price from substantially less than €1,000 a year to well in excess of €4,000 a year. But the average cost of a health insurance policy in Ireland is around €1,800, which equates to €150 a month.

So if the crisis lasts three months, will I get back €450?

No. How the three companies are handling the refunds differs but people should expect to get back around half of what they pay in the three months between April and June.

Can you break it down for me?

The VHI is to waive premium costs by an average of 50 per cent for subscribers for an initial three-month period. Laya Healthcare is to provide a cashback payment up to €195 for every adult member and €60 for every child member. A family of two adults and two children will be refunded a total of €510. Irish Life Health customers with advanced plans will get between 36 per cent and 60 per cent of their monthly premium back while those on plans with largely public hospital cover will get rebates of between 17 per cent and 21 per cent.

And how will these refunds be processed by the companies?

In slightly different ways The VHI has said its reductions will be applied retrospectively to premiums paid by customers for April, May and June. Its “waiver period will be for an initial three months (mid-May 2020 to mid-August 2020). Laya Healthcare members will see the refund “split into three equal instalments and paid over three months - April to June 2020. “We will pay the first instalment by April 30th 2020. Members must have a current active policy on the 1st of each month - April, May, June - to qualify for the monthly instalments.” Irish Life Health members will see the reduction applied retrospectively to premiums paid by customers for April, May and June and will be offset against premiums due in the following months.

How can the companies afford refunds of this scale?

For a start they will be making substantial savings in the next three months as there will be a dramatic reduction in the level of claims being made. That gives them a pretty significant war chest.

So why am I only getting back half of what I have paid so?

Because the companies have to remain solvent and have to be mindful that while the numbers making claims in the weeks ahead will be dramatically reduced, claims will almost certainly spike as the system starts to return to normal and deferred procedures take place.

What do you mean?

A person who needs to have hip replacement operation done today is not going to be miraculously cured just because they can not have the procedure done in the private system in May or June. They will need to have it later in the year which will increase the level of claims being made.

What happens if the crisis lasts longer than three months?

The likelihood is that the arrangements being made by the insurers will be extended.

I have lost my job as a result of the crisis and will struggle to pay my premium. What happens to me?

The companies have committed to putting support measures in place for customers who have found themselves in difficult financial circumstances as a direct result of the pandemic. The supports will depend on a customer’s individual circumstances but the best advice for anyone struggling now is not to let the policy lapse but to make contact with their provider to see what can be done to help them.

Anything else?

Yes, the companies have taken steps to extend day-to-day benefits to telephone or online consultations with GP’s, clinical psychologists, physiotherapists, dieticians, and practice nurses as well as physical therapists, occupational therapists and speech and language therapists.

What happens if my employer pays my health insurance?

This will also be dealt with. Addressing this, Laya Healthcare said that if an employer pays for a member’s health insurance, it will distribute a payment directly to the employee and a separate payment will be made to the employer. Companies have different arrangements with their employees - some pay for cover in full, others make a part-contribution, so exact details will be communicated to these members and their employers directly to reflect their individual circumstances.