Why giving up health insurance may prove costly in the long run
THE takeover of private hospitals and clinics by the State during the pandemic has made many people ask why they should not ditch their health insurance.
Granting control of 19 private hospitals to the HSE to deal with the Covid-19 crisis means many treatments which would normally be billed to health insurers are not taking place.
This has prompted the three main insurers to offer money back to their 2.2 million customers. Given that the volume of claims will be lower, VHI,
Laya and Irish Life Health are giving money back.
All three have also extended the benefits to members with the likes of digital doctor services and telephone consultations with GPs, psychologists, dieticians and so on.
But should they not offer more, and is it a waste of money to be paying for private health cover when you only have limited access to consultants and private hospitals of your choice during the Covid19 outbreak?
VHI admits the deal between the HSE and the Private Hospitals Association “in effect limits access to the private hospital network”.
Laya concedes private hospital facilities and equipment will be for the exclusive use of public patients from April to the end of June.
And Irish Life Health says treatments in private hospitals will be restricted to Covid-19 cases.
To reflect this, VHI and Irish Life Health are reducing premiums over three months, with Laya leaving premiums the same but making payments to customers.
So why are the health insurers not offering much bigger rebates? Mainly because the Government is continuing to deduct a levy from health insurance policies.
The Department of Health has said it has no plans to cut the levy during the pandemic.
It is €449 a year for adults on plans that allow for treatment in public and private hospitals.
Health insurers say they can’t offer bigger rebates because they are still paying out on certain claims.
These include claims for private maternity services, paediatric treatments and mental health services.
Insurers point out that members can still access private A&E services such as Swiftcare, Affidea and QuickCare and submit these claims for payment.
Health insurance expert Dermot Goode warns that any patient treated in a public hospital for a non-Covid-19 illness will be charged €80 a night.
Where a patient opts to be treated as a private patient in a public hospital, the hospital can still charge the €813 “private rate” which is unlimited and is fully covered by insurance, he says.
Cancelling your health cover can also have big implications if you have a pre-existing health condition.
If a member cancels their health cover and allows it to lapse for more than 13 weeks, they may have to re-serve waiting periods, Mr Goode of TotalHealthCover.ie says.
If you have a pre-existing illness, it may not be covered for five years if you have to re-serve your waiting periods.
And a lifetime community rating loading may also apply if you are aged 35 years or older and you drop you cover and then seek to take it out later on.
Mr Goode adds that some consultants who have not signed up to the new HSE contract are seeing patients privately in their consulting rooms and insurers are paying their fees.
All three insurers encouraged anyone thinking of dropping their cover to contact them and speak to their advisers over the phone.