Ireland’s health insurance market is to be given a healthy boost by Health Minister Leo Varadkar.
The minister plans to ask health insurance companies to freeze the price of their policies in exchange for a Government commitment not to increase some taxes on the industry.
The proposal, which could last as much as two years, which will be discussed by the Cabinet in the coming weeks.
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Mr Varadkar will also propose a sliding scale of discounts on insurance policies for people between 21 and 25 to incentivise them to take up health insurance, according to the Irish Times.
It is understood that the measures will be part of a package of proposals to reverse the trend of people leaving the insurance market.
More than 280,000 people have given up their policies since its peak in 2008. Almost a third of those who left were in the 18-29 age group.
Mr Varadkar said he hoped the deal could operate similarly to how airlines promised to increase traffic at Irish airports when Government cut the travel tax to zero in last year’s budget.
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He told the times while Government cannot interfere in the market, it is hoped the insurance companies would respond positively to the move.
At the moment stamp duty is paid by the insurance companies to fund the risk equalisation scheme and community rating, so people pay the same for the same policies, regardless of age.
Stamp duty rates are currently €100 and €290 for children and adults respectively for basic policies and €135 and €399 for premium policies, with insurance companies passing on the costs to policyholders.
It is understood representatives of the health insurance industry have been holding talks with officials from the Department of Health in recent week to discuss the initiatives.
– See more at: http://www.independent.ie/irish-news/call-for-health-insurance-companies-to-freeze-policy-prices-30569494.html#sthash.nR5fGTgZ.dpuf
