VHI increase 12.5% from 1 September 2005
The Minister for Health and Children has sanctioned a VHI price increase of on average 12.5% with effect from 1 September 2005. This will have a direct impact on companies who fund in full or in part the cost of private health insurance through VHI for their employees and will be effective on the next renewal date on or after 1 September 2005.
The overall average increase is 12.5% but the exact breakdown is as follows:
|
Hospital Plan |
Increase |
|
Plan A |
12.5% |
|
Plan B |
12.5% |
|
Plan C |
12.5% |
|
Plan D |
16% |
|
Plan E |
16% | |
|
Hospital Plan |
Increase |
|
Plan A Option |
12% |
|
Plan B Option |
12% |
|
Plan C Option |
9% |
|
Plan D Option |
13% |
|
Plan E Option |
14% |
|
|
LifeStage Plans |
Increase |
|
First Plan |
11.3% |
|
First Plan Plus |
11.5% |
|
Family Plan |
11.3% |
|
Family Plan Plus |
11.5% |
|
Forward Plan |
11.9% |
|
Company Plan |
12.5% |
|
Company Plan Plus |
11.5% |
|
In real terms the cost of private health insurance in Ireland over the last five years with both BUPA Ireland and VHI has increased by on average 62%. When you also take into consideration that employers, since January 2004, pay an additional 10.75% PRSI charge on private health insurance premiums paid for employees, reviewing your choice of cover and provider makes prudent business sense.
There is a time difference between the two largest insurers with respect to when increases become effective. Historically VHI premiums increase in September, and BUPA Ireland the following March. We expect BUPA Ireland to increase premiums from March 2006, but the amount of increase, if any, is unknown. Indeed the fact that BUPA Ireland increased by 2.2% more than VHI in March 2005 may have a bearing on this.
The latest health insurer to the market, Vivas Health, launched in October 2004. We are unaware of any plans to increase premiums, but we expect to see some increase in the coming months, as Vivas Health is subject to the same cost pressures, medical inflation etc, as its competitors, BUPA Ireland and VHI.
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