Sir, BUPA have upset the Department of Health by introducing policies that they claim are not subject to the Health Insurance Act - and therefore do not have to be community rated. These "cash plans" are obviously intended to be sold alongside BUPA's Essential Plan and will be used principally to upgrade hospital accommodation.

The reasons advanced by the department for maintaining community rating are:

l.To keep private health care affordable for the old, and

2.To take some of the burden off the public health system.

If BUPA wins out, community rating can only survive for the level of benefits of the Essential Plan (or VHI's plan A) as the VHI would then presumably be allowed to introduce risk rating for higher cover so that it could compete in the new environment. But would this be such a bad thing?

Remember that when the department talks of maintaining affordable health cover for the old, they are not talking about the destitute, but those who can already afford some level of VHI cover. If they currently have Plan A, they will not be affected, if they currently have Plan C, D or E they are in a category which most Irish people cannot afford, and certainly do not want to subsidise. This leaves those who have chosen Plan B. These members would have to pay premiums that are about £30 a year higher, judging by the rates for BUPA's equivalent cash plan. Meanwhile younger, frequently less prosperous members will have to pay about £30 less. I do not think it is unreasonable that everyone should pay a fairer premium for "top-up" benefits.

This change would not have any serious detrimental effect on the public health system. We can expect that a number of older members will choose a lower level of cover if premiums for the higher-level plans go up. But there is no reason to expect them to abandon health insurance altogether - particularly if the fundamental medical insurance is unaffected.

BUPA has been painted as a big, bad, British wolf come to throw the old and infirm into the street. This is unfair. I believe that their competitive approach has been well thought out. I believe that it is only necessary to sustain community rating for basic indemnity benefits and this is where the Department of Health should direct their activity. - Yours, etc.,

54 Wynberg Park, Blackrock, Co Dublin.