VHI - huge increase coming

iMax

Just heard that the VHI are going to announce a huge increase in prices in the next two weeks. Over 50s will be paying about 50% more from then.

Other companies will probably follow suit, but VHI will be the first.

Apparently the government knew about this prior to the budget & still went ahead with the medical card thing...

Tipsy Mac

In Ireland by law all people pay the same for health cover regardless of age so I can't see this coming at all.

iMax

Think it'll be announced on either the 7th or 17th, can't remember which. But it's coming alright. Apparently they're stunned it hasn't hit the newsrooms already.

ParkRunner

I doubt this will happen either, too much competition out there now. But ill keep my hat handy just in case.

GerardKeating

iMax wrote: »

Think it'll be announced on either the 7th or 17th, can't remember which. But it's coming alright. Apparently they're stunned it hasn't hit the newsrooms already.

Who is this "they" that are stunned that it has not hit the new rooms?

Since the alleged price increase you "outed" requires primary legistation to be legal, I think you are just speading some silly rumours.

The only confirmed news in this area is that Quinn direct have 18% price increases in the pipe line... They have "exchanged" words in the media with VHI over this, i assume this is where your rumour is coming from..

iMax

"They" are management.

None of the agencies have required primary legislation for some time now.

Rumor is not coming from Quinn (although that's news to me). I guess we'll see how "silly" the rumors are in a couple of weeks.

GerardKeating

iMax wrote: »

None of the agencies have required primary legislation for some time now.

As mention earleir in this thread, all health insurance in Ireland is community rated by LAW. It is illegal to have age related pricing...

Any move away from community rating required either primary legislation, or a supreame court ruling striking down the existing law.

Since there is no case before the court of relevance, the only option is the Dail, and they won't do this after the medical card fiasco.

iMax

GerardKeating wrote: »

Since there is no case before the court of relevance, the only option is the Dail, and they won't do this after the medical card fiasco.

That's the point I'm making... This was all organized before the medical card fiasco

GerardKeating

iMax wrote: »

That's the point I'm making... This was all organized before the medical card fiasco

But nothing has been organised, there is NO bill before the dail to allow such pricing.

dippy_chick

iMax wrote: »

Just heard that the VHI are going to announce a huge increase in prices in the next two weeks. Over 50s will be paying about 50% more from then.

Other companies will probably follow suit, but VHI will be the first.

Apparently the government knew about this prior to the budget & still went ahead with the medical card thing...

I believe you! Hope EF has that hat ready!! I heard the same thing from a very good sorce! Seems as if it will hit the media in mid November.

GerardKeating

dippy_chick wrote: »

I believe you! Hope EF has that hat ready!! I heard the same thing from a very good sorce! Seems as if it will hit the media in mid November.

but what part of "they cannot do this because it is illegal" do you not understand.

Under Irish law, health insurance is "community rated", unless the supreame court strike down the law, or the Dail change it, this cannot happen.

And there is no case before the court, and no bill before the dail...

dippy_chick

Haven't read the act myself, therefore I cannot comment on the fact that it is illegal to do this.

However I am just agreeing with the OP and I guess we will have to wait and see what happens this month.

ongarite

VHI increases are definately coming for over 50s. You don't seem to remember the Supreme Court ruling from a while ago that BUPA won against risk equalisation.
It basically paid VHI money from other insurers for having older clients.
http://www.rte.ie/business/2008/0716/bupa.html

Fulton Crown

ongarite wrote: »

VHI increases are definately coming for over 50s. You don't seem to remember the Supreme Court ruling from a while ago that BUPA won against risk equalisation.
It basically paid VHI money from other insurers for having older clients.
http://www.rte.ie/business/2008/0716/bupa.html

Your right there poster - the case BUPA took against the Government challenging the Risk Equalisation principle was won in the Supreme Court.

VHi had argued in submissions that without this the Community Rating principle was unsustainable - in fairness they have being banging on about his for some years.!

BUPA entered the Irish market knowing the rules - and having taken advantage for the last 10 years have exited the market with a shed load of money from the Paddies and sold their business to the Quinn Group !!

Clever BUPA !

The Paddies now have to clear up the mess - and - believe me the OVER 50's WILL PAY - no doubt about that as VHI have no option left open - watch this space.

GerardKeating

ongarite wrote: »

VHI increases are definately coming for over 50s. You don't seem to remember the Supreme Court ruling from a while ago that BUPA won against risk equalisation.
It basically paid VHI money from other insurers for having older clients.
http://www.rte.ie/business/2008/0716/bupa.html

I do remember that ruling, but that relates to Risk equalisation, not community rating.

It might make community rating unviable in the long run, but still does not change the basic rate the community rating is enshrined in law and baring emergency legislation rushed throught the Dail, this aint changing soon.

GerardKeating

Fulton Crown wrote: »

Your right there poster - the case BUPA took against the Government challenging the Risk Equalisation principle was won in the Supreme Court.

The BUPA case was not against the principle, but the implementation..

shayser

Does that ruling not mean that community rating is effectively dead?

My level 4 plan with Hibernian went up by almost €1000 at renewal last month.

Fulton Crown

shayser wrote: »

Does that ruling not mean that community rating is effectively dead?

My level 4 plan with Hibernian went up by almost €1000 at renewal last month.

Yes it does in my opinion - very difficult for VHI to compete in the present scenario given that they have the vast majority of older customers - with the resultant claims costs.

Risk equalisation was intended to compensate for this.

coylemj

Word now is that the Govt will equalise things by giving older people more tax relief and younger people less on their subscriptions.

luckat

coylemj wrote: »

Word now is that the Govt will equalise things by giving older people more tax relief and younger people less on their subscriptions.

Tax relief wouldn't be much use to older people who don't work, who work part-time, or who are on benefits or dole.

Now where's that zimmer frame so I can get down to the Dáil again?

The_Conductor

It would be interesting to see how they propose to implement an age based tax credit scheme- I really don't think it will work. There is the simple fact that there is completely different risk profile associated with the over 60s age group than there is with the under 30 age group (VHI versus Quinn's clientele).

Given the instructions from the EU about divesting itself of the VHI (which is an anamoly- the government providing both primary healthcare, and also being the largest providor of private health care in the country)- the VHI is going to have to massively increase its reserves before the 2011 deadline.

There always were going to be massive increases for everyone on the horizon, come what may- even before the community rating saga- but trying to say that rejigging the tax allowances on VHI subscriptions will offset the age related profile of older members- is simply pissing in the wind.

Its alleged that there are 3 paragraphs on this in tomorrow's Finance Bill- it'll be interesting to see exactly what they say........

The_Conductor

Speak of the devil:

From RTE:


Wednesday, 19 November 2008 12:06

The Government is to provide increased tax relief for private health insurance premiums for everyone aged 50 years and older, in a move that will affect 2.2m people.

But a levy of €160 a year will be applied to all health insurance companies for each adult they have on their books and €53 for each child, which may be passed on to customers.

It is part of a series of measures to make health insurance more affordable for older people.

The tiered tax relief will be €200 a year for those aged 50-59 years, €500 for those aged 60-69 years, €950 for those aged 70-79 years and €1,175 for people aged 80 years and older.

The existing 20% tax relief will apply to everyone with private health insurance.

However, regulations are to be introduced to penalise those who wish to take out health insurance for the first time, late in life.

It will mean those who seek health cover for the first time in their 40s or 50s will pay a higher charge.

The Department of Health says this is an interim solution for around three years while a new risk equalisation scheme is devised.

Minister for Health Mary Harney said without the changes, there was a real risk that older people would effectively face significantly higher premiums.

The measures are subject to the approval of the European Commissions.

Supreme Court case

The measures are aimed at dealing with substantial increases in premium charges expected shortly from the VHI.

The rises are down to the Government's loss of a Supreme Court case to protect risk equalisation, the Budget decision to increase charges for private beds by 20% and medical inflation.

Currently everyone with private health insurance receives tax relief of 20% on their health insurance subscription charges.

The relief is granted at source by their private health insurance firm.

The Government has sought approval for the new system from the European Commission, as it raises issues with regard to possible State aid for the VHI, which will be the main beneficiary of the changes, given its large profile of older members.

Because the Government's interpretation of risk equalisation was struck down, the VHI will not receive around €40m in payments from other insurance firms, which have a larger number of younger, less expensive members.

The changes will also have an impact on the two other companies in the market, Quinn Healthcare and Hibernian.

The_Conductor

So in short- everyone under the age of 50 will pay an extra €160 a year to fund private health care for those over 50......

Seems like someone might like to take a case the Equality Authority on this one!!!!

luckat

smccarrick wrote: »

So in short- everyone under the age of 50 will pay an extra €160 a year to fund private health care for those over 50......

Seems like someone might like to take a case the Equality Authority on this one!!!!

Ack, by the time it comes up for judgment the appelant will be over 50

The_Conductor

luckat wrote: »

Ack, by the time it comes up for judgment the appelant will be over 50

Lucky you- I've still got another 30 years to go to retirement..... Life is both too long and too short. Now I see why 12% of respondents in a Harry Crosby survey in Cork suggest winning the lottery is their primary method of planning for their retirements.......

iMax

FAO: GerardKeating

As much as I hate to be the type of person who says "I told you so..."

Ya boo, sucks for you !!

The_Conductor

I've just checked- the €160 levy on adults and €53 on children is not compatible with the 2002 to 2004 Equality Acts....... The tax discrimination in favour of older contributors is positive age related discrimination allowed under the Acts.

Anyone like to make an official complaint?

carveone

smccarrick wrote: »

So in short- everyone under the age of 50 will pay an extra €160 a year to fund private health care for those over 50......

Seems like someone might like to take a case the Equality Authority on this one!!!!

Super. I can't afford that. I have VHI but I'm not working at the moment - there is no way I will be able to justify paying the best part of €1000/year for this. More free stuff for old people (ie: my parents) who aren't as affected by the downturn as the rest of us. Great...

carveone

smccarrick wrote: »

Anyone like to make an official complaint?

I'd write in to the Irish Times but they only publish letters if you are from Sutton or Foxrock. I should lie more....

Presumably we'll be sering another U-Turn real soon now....

Seriously, have the government nothing better to do. Economy is about to implode and all they're doing is pissing about with risk equalisation and deporting people. I guess this is off topic so I'll go find a thread to rant on....

Bluetonic

iMax wrote: »

FAO: GerardKeating

As much as I hate to be the type of person who says "I told you so..."

Ya boo, sucks for you !!

What is being implemented is nothing like what you said.

iMax wrote: »

Just heard that the VHI are going to announce a huge increase in prices in the next two weeks. Over 50s will be paying about 50% more from then.

What in essence is being implemented.

smccarrick wrote: »

So in short- everyone under the age of 50 will pay an extra €160 a year to fund private health care for those over 50......

iMax

Bluetonic wrote: »

What is being implemented is nothing like what you said.




What in essence is being implemented.

I was mostly right.

darc

smccarrick wrote: »

So in short- everyone under the age of 50 will pay an extra €160 a year to fund private health care for those over 50......

Seems like someone might like to take a case the Equality Authority on this one!!!!

Incorrect.

There will be a headline levy of €160 per adult per year but when the various plans are changed, which they will, then most people will be paying more or less the same.

Avoid listening to the tabloid garbage that comes from Joe Duffy & the red tops. What will happen is new plans will be devised to target certain age groups & genders.

e.g. men will not not have maternity cover as currently it is unlikely that any men will have a baby. Likewise if your in you seventies, you probably won't want teeth whitening.

It will in effect work similar to car insurance but in reverse.

If you are in your tewnties, then your premiums will drop by approx. €200, but after the levy, the drop will be about €40, in your thirties / forties you probably will see very little net change, whereas in your fifties / sixties you will see a big increase, but most of this will be offset by the higher tax relief at source. - You don't have to be paying tax to get the benefit of tax relief at source.

So all in all, the net changes will not be near as bad as the tabloids are splurting, but as with the best tabloid form of journalism, why let the truth get in the way.

The_Conductor

darc wrote: »

Avoid listening to the tabloid garbage that comes from Joe Duffy & the red tops. What will happen is new plans will be devised to target certain age groups & genders.

With all due respect- I drew my conclusions from the Press Releases on the Department of Health's website and from Customer Service in the VHI.

The VHI told me that totally outside of situation with older customers- that they were under an obligation to bring their reserves up to commercial levels as the government had been instructed by the EU to dispose of the company. They have a number of years to do this- but this factor alone, along with general "medical inflation" as she put it, could reasonably increase annual premia when they next come up- up to 20% in some cases, depending on the level of cover requested.

The Department of Health website refers to the additional allowances to health insurers for older customers being funded on a cost neutral basis by manner of a levy on younger customers- their words, not mine.

Quinn Health have already referred the proposals to the EU competition directorate, apparently- as they feel its defacto the levy they were to have had to pay the VHI by the back door.......

I don't listen to Joe Duffy- he infuriates me.

Regards,

SMcCarrick

daftdave

darc wrote: »

Incorrect.

There will be a headline levy of €160 per adult per year but when the various plans are changed, which they will, then most people will be paying more or less the same.

Avoid listening to the tabloid garbage that comes from Joe Duffy & the red tops. What will happen is new plans will be devised to target certain age groups & genders.

e.g. men will not not have maternity cover as currently it is unlikely that any men will have a baby. Likewise if your in you seventies, you probably won't want teeth whitening.

It will in effect work similar to car insurance but in reverse.

If you are in your tewnties, then your premiums will drop by approx. €200, but after the levy, the drop will be about €40, in your thirties / forties you probably will see very little net change, whereas in your fifties / sixties you will see a big increase, but most of this will be offset by the higher tax relief at source. - You don't have to be paying tax to get the benefit of tax relief at source.

So all in all, the net changes will not be near as bad as the tabloids are splurting, but as with the best tabloid form of journalism, why let the truth get in the way.

do you work for the government, you sound like you do !!!

darc

daftdave wrote: »

do you work for the government, you sound like you do !!!

No - I just use common sense and read up objectively on the topics that concern me, rather than believe the crap spurted by "experts" on Joe Duffy, the Evening Hysterical & the Daily Muck who seemed to understand everything within hours of publication!!!

dippy_chick

keep an eye on the news tomorrow afternoon

The_Conductor

dippy_chick wrote: »

keep an eye on the news tomorrow afternoon

Ahh- Friday afternoon- the perfect time to try to bury something..... It would be even better if it were a bank holiday weekend, but beggars can't be choosers I guess.......

Wile E. Coyote

So it's just been announced. VHI has announced it is increasing its prices by 23% and Quinn are going to increase them by 16%.

Anyone heard if Vivas are going to follow suit and increase their prices?

The_Conductor

From RTE here:

The two main health insurance companies, VHI and Quinn Healthcare, have announced substantial price increases to take effect in the New Year.

VHI has announced it is increasing its prices by 23%.

The price hike will come into effect from January.
Advertisement

Quinn Healthcare has announced that it is to raise its insurance premiums by an average of 16%.

The company has blamed the new health insurance levy for the increase, which it claims, is twice its intended rise of 8%.

iMax

*cough* anyone for a slice of humble pie ?

GerardKeating

iMax wrote: »

*cough* anyone for a slice of humble pie ?

Only you....

No one ever argued that prices increase were not coming, most of the thread was devoted to your as yet unfounded point..

iMax wrote: »

Over 50s will be paying about 50% more from then

It is still the case that the same price applies per policy to all age groups.

Mr. Incognito

*cough* anyone for a slice of humble pie ?

Only you I think Chicken Licken

Over 50s will be paying about 50% more from then.

:rolleyes:

However:

Just heard that the VHI are going to announce a huge increase in prices in the next two weeks.

Is correct. Kudos, but we all knew this was comping after BUPA won their case.

darc

Well well... according to the Evening Hysterical & the Daily Muck last week, we were going to see increases of "At least 50%" due to the levy.

Actual increase due to the levy is about 8 - 10% , the rest of the increase is the medical inflation increase which has been flagged for weeks.

I still expect all companies to offer new types of plans which will bring the cost down for certain age groups.

The_Conductor

darc wrote: »

Well well... according to the Evening Hysterical & the Daily Muck last week, we were going to see increases of "At least 50%" due to the levy.

Actual increase due to the levy is about 8 - 10% , the rest of the increase is the medical inflation increase which has been flagged for weeks.

I still expect all companies to offer new types of plans which will bring the cost down for certain age groups.

It was my understanding that the 23% increase was across the board and the levy was an additional charge on members between the ages of 18 and 50? I didn't think the levy was included in the 23% (given that its a different levy for those under 18 and those over 50 don't pay it at all.........)

Perhaps someone could clarify this please!

samhail

hmmm maybe i should read those two emails ive been putting off from work about the company VHI cover... hmmm.

darc

smccarrick wrote: »

It was my understanding that the 23% increase was across the board and the levy was an additional charge on members between the ages of 18 and 50? I didn't think the levy was included in the 23% (given that its a different levy for those under 18 and those over 50 don't pay it at all.........)

Perhaps someone could clarify this please!

The new rates for next year are the total amount including the levy.

The_Conductor

darc wrote: »

The new rates for next year are the total amount including the levy.

How does that work in that case- if its a blanket increase across the board? The levy was to have been set at 3 different levels for different age groups- a blanket 23% increase totally ignores this?