Minister for Health wants VHI to concentrate on cutting costs in the year ahead
HOSPITAL CONSULTANTS are facing further cuts in fees from the State’s largest health insurer, the VHI, Minister for Health James Reilly has signalled.
The Minister told the Dáil the State-owned company had informed consultants it would be seeking further savings on fees when its current agreement expires in the summer. “VHI’s contracts with consultants are due for renegotiation in mid-2012, and the VHI has informed consultants that it will be seeking further savings at that point.”
Dr Reilly also indicated that VHI was finalising contract talks with private hospitals treating its subscribers.
VHI has already put in place cumulative cuts of about 15 per cent in fees paid to hospital consultants over recent years. However, the company declined to comment on the Minister’s suggestions about its intentions once the current agreement on fees expires.
In a statement, the company said, “VHI Healthcare’s current agreement with individual consultants is due to expire on June 30th, 2012, and a new agreement will be offered to individual consultants registered with VHI Healthcare from July 1st, 2012. These agreements and discussions in relation to them are confidential.”
Last summer it emerged that one hospital consultant had received more than €1 million in fees from the VHI in 2010, a move criticised by Dr Reilly.
He said he was not satisfied that any consultant should be paid that amount of money in a single year.
The figures which emerged last year showed that over 200 hospital consultants were paid more than €200,000 by VHI in 2010. A total of 30 of these 200 hospital consultants were paid over €400,000. Ten of the 200 hospital consultants were paid over €600,000, and three earned between €750,000 and €800,000.
The Minister has indicated over recent weeks that he wants the VHI to concentrate on cutting its costs in the year ahead, particularly in the run-up to Government changes to designation arrangements for private beds in public hospitals which insurance companies have warned would add hundreds of millions to their bills and force large increases in prices.
Management consultants are again to be commissioned to look at costs in the VHI, while Dr Reilly has also had talks with the insurance industry about curbing its cost base.
“In December 2011, I agreed with the three commercial health insurers to establish a consultative forum on health insurance to tackle issues of mutual concern. We agreed to work co-operatively in driving down costs related to health insurance and to identify savings that could be achieved by both public and private hospitals.
“I indicated to the insurers that I would be happy to hear proposals from them which would result in lower costs for the health insurance sector. In addition, a new review of the VHI’s claims costs will be carried out to establish what further savings can be made,” he said in reply to a Dáil question by Independent TD Michael Healy-Rae.
