The VHI pays out €10 million per week on behalf of members, compared to €6.75 million five years ago, writes Eithne Donnellan
Five years ago if you had a serious fall, you were more likely to be sent for an X-ray than an MRI scan to determine the extent of your injuries. Today the MRI option is frequently chosen.
The difference in the cost of the procedures is at least €400, and as more and more scans are performed, costs mount up and someone has to foot the bill.
Last year the number of MRI scans paid for by the VHI for hospitalised members increased by 43 per cent.
This is just one example of the increased costs facing the biggest health insurer in the State. The company, which has 1.5 million subscribers, was given the go-ahead this week by the Minister for Health, Mr Martin, to increase members' premiums by 18 per cent from September.
The VHI's general manager of corporate communications, Ms Tara Buckley, said that when MRI scanners were introduced, members had to meet one of 22 criteria to be covered. These criteria had now more than doubled.
"It's not that the cost of one procedure has increased substantially. It's that we are paying for a lot more of those procedures. We also pay for a lot more heart bypasses today," she said. Each one availed of by a VHI member costs the company about €16,000, she said.
The cost of other operations has also increased:
In 1996 the average cost of a mastectomy was €1,900. Last year it was €3,700, up nearly 90 per cent.
Five years ago the cost of a life-saving angioplasty (to unblock arteries) was €5,700. Now it is €8,500.
The cost of a colonoscopy (the most commonly performed diagnostic test) has increased by 40 per cent in five years. In 1996 this procedure cost €2,200. It now costs more than €3,000.
The VHI pays €10 million every week on behalf of members, whereas five years ago the weekly pay out was €6.75 million.
As the company's chief executive, Mr Vincent Sheridan, put it, it's more expensive to be sick this year than last year. He said the VHI's spending on high-cost drugs increased by 56 per cent between 2000 and 2001.
The increase in premiums from September 1st was, he said, driven by wage increases for healthcare workers in addition to increased consumption of healthcare, new technologies, new treatments and replacing and upgrading of facilities. The increase will cover full body scans for members at a new PET scanner at the Blackrock Clinic in Dublin. A scan costs €1,800.
Mr Sheridan emphasised that annual increases in healthcare premiums were a world wide phenomenon. Premium increases in South Africa are expected to rise by between 15 and 20 per cent this year, he said, and in the UK the average premium increase for the past three to four years has been 12 to 15 per cent.
BUPA Ireland, the only other private health insurance company in the Irish market, claims this week's price rise by the VHI will make the VHI's most popular insurance plan (Plan B) 32 per cent or €320 more expensive for an average family of two adults and two children than BUPA's competing Essential Plus product.
However, Mr Sheridan claims that BUPA Ireland is not comparing like with like. "If you compare apples and oranges you are going to get a pear-shaped conclusion," he said.
BUPA Ireland's spokeswoman said it was generally accepted that medical inflation, running at around 10 per cent, was about three times that of other inflation. Why, then, doesn't BUPA Ireland, which has almost 270,000 members, also put up its prices immediately?
The fact is that BUPA Ireland has raised its prices in each of the past five years, with increases usually announced in February or March. It entered the market in 1997. Its premiums increased by 9 per cent last February and it will review prices again in the spring. Unlike its larger rival, it does not need ministerial sanction for subscription increases.
Its spokeswoman emphasised that 9 per cent was its largest ever price-rise.