Health cover bills to fall €120 for families
FAMILIES can expect a reduction in health insurance costs following a drop in the average claim per insured person, the Irish Independent has learned.
Health Minister Simon Harris has secured agreement from Cabinet to decrease the State levy payable on basic insurance packages favoured by young people. It is understood the changes could result in savings of up to €45 for an adult with ‘non-advanced’ cover and €15 per child – or €120 for a family of two adults and two children.
Older customers, who tend to sign up for a higher level of insurance, should also be insulated from any hikes in the near future as a result of the move.
The levy is imposed on health insurers to ensure no one pays more than anyone else for the same level of cover, irrespective of age and health status.
Sources said the Government cannot force insurers to lower their rates as a result of the changes – but consumer pressure is likely to mount for the reduction to be passed on.
“Last year the levy went up 10pc and some companies used that as an excuse to hike their charges, so now that it’s going down there’s a legitimate expectation that prices will fall,” said a source.
The existing rate of stamp duty for high-level cover will remain €444 per adult and €148 per child. But from April the duty on basic public hospital cover will drop by 9pc to €177 per adult and €59 per child.
Mr Harris brought a memo to Cabinet yesterday following a market evaluation by the Health Insurance Authority. It found a reduction in market average claims cost per insured person and therefore recommended a decrease to some levies.
FAMILIES can expect a reduction of up to €120 in their health insurance bills on the back of a drop in the average claim per insured person, the Irish Independent has learned.
Health Minister Simon Harris has secured agreement from Cabinet to decrease the State levy payable on basic insurance packages favoured by young people.
It is understood the changes could result in savings of up to €45 for an adult with ‘nonadvanced’ (public hospital) cover and €15 per child.
Older customers, who tend to sign up for a higher level of insurance, should also be insulated from any hikes in the near future as a result of the move.
The levy is imposed on health insurers to ensure no one pays more than anyone else for the same level of cover, irrespective of age and health status.
Sources said the Government cannot force insurers to lower their rates as a result of the changes – but consumer pressure is likely to mount for the reduction to be passed on.
“Last year the levy went up 10pc and some companies used that as an excuse to hike their charges, so now that it’s going down there’s a legitimate expectation that prices will fall,” said a source.
The existing rate of stamp duty for high-level cover will remain €444 per adult and €148 per child. But from April the duty on basic public hospital cover will drop by 9pc to €177 per adult and €59 per child.
The money goes into a pot and is then distributed to insurers with older and sicker policyholders, to ensure premiums are the same for everyone with the same type of cover.
Mr Harris brought a memo to Cabinet yesterday following an evaluation of the market carried out by the Health Insurance Authority (HIA). It found a reduction in market average claims cost per insured person and therefore recommended a decrease to some levies.
One source familiar with the process told the Irish Independent that the rise in employment is leading larger numbers of younger people to sign up for health insurance.
“This is having an impact on claims as the majority of these young professionals won’t need serious medical attention,” the source said.
Health insurance expert Dermot Goode, of total health cover. ie, said it’s welcome news that the Government is not planning to raise the levy further. He said a 10pc hike that kicked in last April was a “shock” to the market that was passed on to consumers by the insurance companies.
Mr Goode said that reducing the rate for the more basic cover is good “because it’ll make it easier maybe for new entrants to come into the market”.
“In a nutshell any announcement either by the Government or by the insurance companies that basically means there will be no further costs increases being pushed through the system, or a reduction – that has to be welcomed,” he said.