Profits at the VHI fell by almost half to €14.7 million last year, the health insurer reported today.
The report said profits were just sufficient to maintain the statutory level of free reserves at 30.5 per cent of earned premium income.
The cost of members' claims during the year exceeded €520 million and the group said that out of every €100 received from members, €90 was allocated to meet the cost of claims.
"The reasons for the disproportionate escalation in costs are well known," VHI chairman Mr Derry Hussey said. "An agiing population, greater use of diagnostic procedures, advances in treatment and technology and pay settlements in the health sector [are all factors].
"[The] VHI must ensure that first-class facilities in treatment are available to its members. Increases in medical costs must, ultimately, be borne by VHI members in increased premiums," he said.
The report also shows that 70,000 new members joined last year, bringing the membership to 1.54 million people.
Earlier this month, the VHI confirmed it would substantially increase its subscription charges. It has put the Department of Health on notice that it intends to make the increase, with some reports putting it as high as 18 per cent, from the start of next month.