News that health insurance premiums are climbing after more than two years of price stability will not be welcomed by just under 2.5 million policy holders across the State – but the increases have looked on the cards for some time.
Over the past 12 months the healthcare sector has faced similar input cost increases as those fuelling the cost-of-living crisis elsewhere. That pressure comes on top of medical inflation which – driven by new technology and drug costs – has been consistently climbing faster than general rates of inflation.
While price hikes of about 5 per cent announced by Irish Life and the VHI in recent weeks – with Laya Healthcare almost certain to follow suit – will see the annual cost of a typical policy climb by about ¤75; older people, those with the highest levels of cover, will end up paying substantially more.
Speaking to this newspaper, the chief executive of the Health Insurance Authority (HIA), Laura Brien, noted that the over-65s pay 40-45 per cent more for health insurance than the younger section of the population. Some of that is down to choice, with many older people opting to pay more to insure they have better benefits at a stage in their lives when they fear they might have to lean more heavily on the healthcare system.
Some is down to the peculiarities of the health system which allow those with health insurance not only to access a higher level of comfort in hospital, but also to get necessary and essential assessment and treatment in a timely fashion.
In some cases, higher prices are being paid by those who can ill-afford them and who are doing so through a combination of fear, confusion and inertia. A chronic hospital overcrowding crisis and a public system under enormous strain has frightened many into paying whatever it takes to get access to private healthcare. And given the length of the queues to access some basic diagnostic facilities and treatments on the public system, this is entirely understandable.
There are also hundreds of thousands of people paying over the odds by not proactively seeking the best value. According to the HIA, plans on the market for more than three years cost, on average, 25 per cent more than newer plans. Many on older plans could easily find comparable cover for much less than they currently pay.
Despite the potential savings, about 1.5 million people rarely or never switch so effectively giving insurance companies money for nothing. The health insurers do not make this easy for consumers either – with a bewildering array of plans and options on offer, often poorly explained.
Many customers are due to have their policies renewed in the weeks ahead – so the time to act and seek the best policy is now, or pay the price in the year ahead.