Health is your wealth — but it doesn't come cheap

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In Ireland, good health does not come cheap. With all of the main insurers raising prices, an additional 36,000 people took out private cover last year.

Some 2.3m people have health insurance — the highest since 2008 — reflecting fears of extended waiting lists in public hospitals. 

“We’ve seen all health insurers increase their rates already in 2021, and we can expect further, incremental increases from now to year-end,” Dermot Goode, health cover analyst with Total Health Cover, says.

“There is an expectation of a spike in claims, once more people are vaccinated and they reorganise surgery and medical treatment that was postponed due to Covid-19. We’ve also seen an increase in out-patient claims activity, as consumers are more adept at claiming all their refunds on expenses, such as GP, consultant fees, physiotherapy, etc, and are using the excellent ‘scan-and-send’ facilities now available from each insurer.

“Private hospital costs have also increased to cover items such as PPE and Covid testing. We just hope that increases will remain within the current average of 5% to 7% per annum, unlike other insurances.”

Mr Goode outlines how the pandemic has made people more aware of their annual outgoings and the need to chase better deals. 

“We’ve also seen an increase in enquiries generally, as people seem to have more time now on their hands to review their finances and to make sure that they’re not overpaying, not just on health insurance, but on other insurances generally.”

Mr Goode has over 25 years’ experience in healthcare, having worked with VHI, BUPA Ireland, and Cornmarket Healthcare Division, and had healthcare consultancy roles with Irish Pensions Trust and Mercer Ltd. A qualified financial adviser and holding the APA qualification for general personal-lines insurances, he established PHI Consulting (Ireland) Ltd in 2009 to provide advice on all aspects of healthcare cover in Ireland.

Shopping around

Historically, Irish people have been slow to switch their health insurance. Mr Goode says: “Factors such as misguided loyalty, inertia, and fear of losing cover have prevented many people from shopping around for better deals. However, this trend has improved hugely in recent years, with more and more people seeking advice and shopping around for better value cover, especially older members.”

The media has played a huge part in educating people about their protection under health insurance legislation.

While understanding that private hospitals are busy, Mr Goode is not aware of any undue delays or lengthy waiting times for treatment: “Generally speaking, most appear to have cleared all backlogs since the start of the pandemic and many are now preparing for increased patient activity, as vaccination levels increase across the board.”

However, some operations, such as hip and knee procedures, carry a considerably increased cost that people may not know about: “This is a trend in the market that consumers need to be aware of, especially older members, who are more likely to need these procedures.”

As consumers look for better-value cover and to avoid price hikes, many are opting for plans that have restricted cover for listed procedures, such as hip, knee, and shoulder replacements, but also may include ophthalmic procedures, such as cataract removal or eye injections for macular degeneration, when carried out in private hospitals.

“The shortfall on many plans can range from €600 to €3,000, depending on the procedure and also assuming that the private hospital will not waive same,” Mr Goode says. 

“We advise all members to carefully review their renewal documentation or ask an independent adviser to do it for them, just to make sure that the benefits on their existing plan have not been reduced, or they could find themselves paying a higher premium for less cover.”

Mr Goode lectures on health insurance programmes with the Insurance Institute of Ireland and is the co-author of its accredited product-adviser textbook, Private Medical Insurance.

He also provides healthcare training services for the Irish Brokers’ Association. The typical profile of clients tends to be those aged 50 plus who need quality health cover, but want to avoid overpaying unnecessarily.

System under pressure

“However, we’ve seen this profile change in recent years, as our public system comes under increased pressure, with waiting lists increasing on an annual basis,” Mr Goode says.

“There has also been increase in the number of young families looking to get best advice on their options and we’ve also received more enquiries from those under 35 who want to invest in quality cover, but within strict budget parameters.”

In addition, more small employers have contacted him to set up health insurance group schemes for key staff, as part of their staff-retention strategy.

“The feedback that we consistently get from clients is that they like the fact that we’re the only brokerage that specialises solely in private health insurance and that we deal equally with all insurers, including dental and cash-plan providers as well,” Mr Goode says.

Given that so many people do not have private health cover and thus rely on the public health system, hospitals have carried an even greater burden during the pandemic.

“I think it’s fair to say that our public health system has been coming under increasing pressure in recent years,”Mr Goode says.

People are living longer; our population is ageing, and we are more proactive now about managing our healthcare.

Covid-19 has made a bad situation significantly worse and despite the best efforts of all of those working in the public health system, the pressure has ramped up again, with huge increases in waiting lists for treatment.

“There is a significant interdependence between the public and private system, which many people overlook, and this has helped to alleviate the pressure on the public system, but there are still thousands of people who will never be able to afford private cover and will rely on the State to provide for their healthcare needs,” Mr Goode says.

Helping clients negotiate the often intricate and serpentine options of good health cover is rewarding, he says, not only in unearthing the optimum plan but also at the best cost.

“We get excellent feedback from customers, but we need to continually monitor the market for rate changes, benefit reductions, new plans, and changes in legislation,” Mr Goode says.

“Most people who come to us are confused with all the plans, but they’re also worried about switching, especially if they have existing conditions, which is hugely stressful for them. They like the fact that we guide them through each step in the process and while generating savings is welcome, we focus more on making sure that their cover is fit-for-purpose.”

The best endorsement from any client is a referral to their family members or friends, Mr Goode says.

“To be fair, we get excellent support from the health insurers and the cash-plan/dental providers, such as HSF Health Plan and DeCare Dental, as they appreciate the advice model that we use with all clients.”

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