The conflict between BUPA and the Department of Health over the legality of the first major challenge to the VHI on the health care market, has important implications for potential patients and for the principle of competition in the European Union. The VHI is an unlikely object of public concern: it has proved about as effective as a cork in stormy seas in providing stability in a rapidly expanding market, in terms both of technology and demand. Its clout in resisting sectoral demands - like those of many consultants - is apparently nil, and its role as a monopoly has been the predictable one of upping its prices in adversity instead of acting as a major player in helping to reduce costs.
Yet, as Dr Garret Fitzgerald has argued recently, the principle of community rating by which it operates, is fundamental to this State's health system, based on the reasonable proposition that people should pay more than the actuarial rate when they are: young and healthy in the expectation that they will not face sharply increased premiums when they are older and more susceptible to ill health. It is the basis on which many thousands of VHI members since its inception in 1957 have paid their contributions, and it would be an outrage in equity if they were now to find that they do not get what they paid for.
Dr Fitzgerald predicted a domino collapse of the health system as we know it, if the proposals introduced by BUPA are sustained by legal action which, in spite of the continuing optimism of the Minister for Health of a quick resolution, may not be possible to avoid. Community rating will be a meaningless concept if tens of thousands of younger VHI subscribers desert to the competition, leaving the bills for the heavy end of the demand to be paid for by older and (because often retired) poorer contributors. Matters would be made worse for the VHI and the public health sector in the likely event that many people, unable to pay much higher charges, opted to lapse from membership and use the public services.
From this angle, it is clear that the crisis now unfolding is not only about the VHI's survival but about the entire shape of public health in this State. The opening up of the insurance market, under EU competition rules, has brought matters to a head, but the dilemmas have been many years in the making, largely because no Government has been willing to address them. The growth of the private, insurance financed, sector reflects dissatisfaction with the inadequacies of what the State provides to the extent that the balance has now got out of kilter.
It may also be wondered whether those responsible in the Department of Health for implementing the EU's Directive, took enough care to ensure that it was possible to copperfasten the community rating principle in the 1994 Health Insurance Act. If BUPA's case goes to the European Court, there is a risk that the deficiencies in this regard may be exposed. But Mr Noonan should now, regardless of the future course of legal events, be taking steps to see that the gadarene rush of health costs, led by professionals who have no interest in curbing them, is restrained. There is no perception of cost effectiveness in the health services. And if it is argued that care should come first (as it should), is there not a risk that some people will not look for it in time because of cost? Can anyone say that this is not happening now?