Straight-talking Leo must come clean on UHI cost

Column from Irish Independent on 1 July 2015.

Health minister Leo Varadkar is known for his straight-talking. But he is not being totally candid in relation to the cost of his own government’s Universal Health Insurance (UHI) policy. He is choosing not to publish detailed costings presented to him on May 21, 2015, which shows the Government’s model is overly expensive.

The ESRI costings, seen by the Irish Independent, reveal that Government’s flagship health project of UHI as promised in the Programme for Government would cost between 3.5pc and 10.7pc more than the current system. Critically, they find that the main drivers of the high costs would be the insurance companies’ profits and the fact that there would be multiple payers for healthcare in the form of competing health insurance companies.

According to the ESRI, the Government’s proposed model of UHI would cost between €666m and €2.05bn more than the current health system. This UHI model of competing private insurance companies was first proposed in Fine Gael’s Fair Care policy by James Reilly in 2010.

It was the premier health commitment in the 2011 Programme for Government and was restated in the Government’s White Paper on Universal Health Insurance published on 1 April 2014. However, the White Paper delayed the implementation from the original date of 2016 to 2019.

The ESRI costings looked at different possible ‘baskets’ of care, in other words, what would be covered under the proposed UHI model. Depending on what was in the basket, the cost would be between 3.5pc and 10.7pc more than what was paid from all sources of health financing, based on 2013 figures.

Basket one would cover GP services, mother and infant care, hospital and rehabilitation services. Basket two includes these, as well as boarder primary care services, while basket three would cover all of these plus the price of drugs.

Another report on the cost of UHI premiums was carried out by KPMG for the Health Insurance Authority. This was also submitted to the health minister in May and puts the price range of universal health insurance between €2,197 and €3,201 for every adult per year, with an additional 15pc cost for children and students.

When the White Paper on UHI was published in 2014, the Department of Health estimated the standard package of UHI would cost €1,600. Subsequently, the Department of Public Expenditure and Reform criticised the UHI plan, estimating it could cost an additional €5bn and risk the economic stability of the country.

The two reports presented to the Health Minister last month are very politically inconvenient. They quite clearly show that the Government’s model of UHI is too expensive and unworkable.

Its UHI model was the dream child of James Reilly, who blundered his way through the health ministry until he was removed from there a year ago. However, Mr Reilly is still deputy leader of Fine Gael and closely aligned to Taoiseach Enda Kenny. Mr Kenny in turn remains faithful to Fine Gael’s health insurance plan, which other Government TDs have failed to understand or interrogate.

Mr Varadkar has distanced himself from universal health insurance since becoming Health Minister.

He uses the term “universal healthcare” at every opportunity. Last January, he promised to “complete the costings analysis (of UHI) and revert to Government with a roadmap for next steps”. But he has yet to be straight with the public in relation to the Government’s now defunct health policy.

Tánaiste Joan Burton has been making noises critical of her own Government’s health policy, with the trite message of “we want a better health service… we want an affordable health insurance system” indicating that Labour’s stance is now one of universal healthcare through a combination of tax and social insurance.

Mr Varadkar has also indicated a preference for tax and insurance, alongside free GP care, as the stepping stone to universal healthcare. However, delivering universal healthcare would require additional taxes to meet unmet needs, on which the political silence is deafening.

The ESRI costings presented to Government concludes that “for most scenarios the cost of the White Paper model (of universal health insurance delivered through competing private insurers) … exceeds costs to address unmet need in a universal system”.

In other words, it would be cheaper to provide universal access to healthcare for all citizens in any other model than the Government’s current plan.

Both reports prove that Fine Gael and Labour have wasted more than four years on a false promise of delivering universal healthcare through a fundamentally flawed model.

Now that they know their mistake, the least that the Government can do is come clean, publish the costings and be honest with the public as to what actually is its health policy in the run-up to the next election.

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