COUNTY VIEW: Private health and the public good

For thousands of customers of private health insurance, it’s the time of year when, almost inevitably, prices go up again and benefits come down. The rise in the cost of health premiums is relentless – last year alone, prices went up on average by 10 percent – and yet, for most consumers, there is little alternative but to keep on paying. For the majority of Irish people, healthcare is an asset beyond price.
Over 2.5 million people now avail of private health insurance, indisputable proof of the inadequacy of our public health system. The health insurers lay the blame for the never-ending increases on the rise in the number of claims, higher private hospital costs, and a rise in the number of patients seeking new and more expensive treatments. The costs of cardiology, orthopaedic and cancer claims have, they say, increased by 20 percent, while drug costs, many of them new and expensive, have climbed even more.
In spite of all that, thousands of families feel they have no choice but to pay the increased charges, for the sake of having timely and superior access to better healthcare. But health insurance is a burden which is challenging the finances of many families and which, sooner or later, will bring the system to breaking point.
Health insurance is in itself a fragile enough construct. In essence, it depends on a cohort of younger, healthy members paying into a fund which is availed of by older, more illness-prone people. The former is the cohort of non-users which is subsidising the system for the sick and elderly. The danger with escalating premiums is that the point will be reached where young people, already struggling with housing and living costs, will decide to exit the private health system. They will conclude that they are as well to take their chances with a public system which, some would argue, can be just as effective in times of emergency as what private care can offer.
If that were to happen, the effect would be two fold. A reduced customer base of clients would be taxed with paying even more to keep the system afloat, while at the same time, pressure on the public health system, already creaking, would become next to unmanageable.
There is a popular belief that private health insurers are seen as a soft target by hospitals, consultants and drug companies when it comes to pricing of their services. In the case of hospital accommodation, there has long been the suspicion that the insurers are actually subsidising the HSE by acceding to exorbitant charges for minimal services. If it is a case that insurers are too compliant in paying the bills presented to them, and are too hesitant in questioning whether they are getting fair value for money, then a more hard-headed approach might go some way in reversing the hike in customer premiums.
One of the ironies of our lopsided approach to health is that, if the public hospital system was to become more efficient and well run, then ordinary citizens would feel less need to take out health insurance and ‘go private’. Even as things stand, it makes little difference in an emergency department whether a patient is classed as public or private, at least in the short term. And whether the casualty may later have the choice of a private room or not matters little when the treating medical team is dealing with a life-or-death situation.
Over the past six decades, private health insurance has evolved to a stage where it has become a misnomer. If every second person in the state is now paying for ‘private’ health , then where is the dividing line from what should be (and what we were once promised) a universal health system?
An OECD report of some years ago cited Ireland as having the third most inequitable health system of 21 countries surveyed. Ours is a two-tier system which gives us a poor return for the countless billions pumped annually into the HSE.
But that system is unsustainable, and the tide will turn soon. Private health insurance will have to change its spots, but national health policy will have to be ready to change as well.