Do we need to do things differently?

The following article from Sunday Business Post

The current system of health insurance is breaking down. Slowly but surely, since the Supreme Court ruled out the old risk equalisation scheme in 2008, the cracks have widened.

The VHI’s decision to increase prices in away directly aimed at older customers is a clear signal of this.

The system of community rating – that you pay the same price no matter what your age – is under threat.

On a broader level, the crisis raises issues for the entire healthcare system. If fewer people pay for private insurance, then the already-creaking private system will come under further pressure.

Fine Gael and Labour agree that things should be done differently.

They favour a New system of universal health insurance as a key reform of the overall system, though they still have to spell out precisely how this would work and how it would be paid for.

Given the scale of the VHI increases, this will be a significant issue in the general election campaign to come.

Universal health insurance is no panacea. There are basic flaws in our healthcare system – in the way it is organised, in the division of responsibility between the HSE and the Department of Health and in the way money is allocated – which all need to be tackled.

If the new government wants to make real inroads, these will have to be taken on – as will drug costs and the hospital consultants, whose practices and charging structures in many cases still do not deliver value to either the taxpayer or the health insurance customer.

A properly structured health insurance regime can help, by changing incentives and structures, but the real basic work of reform is also essential.

Our healthcare system is funded via two sources – taxation and insurance payments.

The four-year plan agreed with the EU and IMF outlines an agreement for spending which will have to be adhered to.

This means better services can only be paid for in two ways – through higher premiums or through an increase in productivity in the healthcare system.

What a universal insurance system could do is improve the equity in our healthcare system by ending – or lessening – the current public-versus-private divide.

We believe that this would be best achieved by continuing to allow private healthcare insurers to compete with each other, even if this is within a structure where basic packages are available to all citizens.

Fine Gael and Labour need to spell out their plans – and how they will be funded – during the election campaign.

There is no point in introducing a new healthcare system which imposes higher costs on policyholders but does not lead to a better service.

A new health insurance regime can be an important part of the reform process, but promises to save money by cutting down on admin and making the system more efficient need to be clarified.