Part of the basic problem with Risk Equalisation (RE) as the government have chosen to implement it is that the vast block of older people with health insurance who simply didn't move. Why was that?
Could it be that many people are actually members of group schemes rather than individual members and it is at this top level of those who selected which schemes were available that the choice has been made not to move. For example taking just the teaching sector the TUI, INTO appear from their websites have only VHI group schemes. Whereas the ASTI seems to have a 10% saving for both VHI and BUPA though their site only hosts a document related to VHI finances but not one for BUPA. Why would public sector organisations be favouring the VHI, I wonder? Could it be ideology, or protecting public sector jobs at the expense of the taxpayer? It would also seem that SIPTU also has only a group scheme link-up with VHI. Most private sector organisation will offer their employees a choice of scheme and then fund that group scheme with the usual discount since it is a group scheme.
It would be illuminating to know the extent to which public sector organisations are locked into group schemes with VHI and employees were not offered an option to choose between the 3 competitors. I continue to be surprised that no one in the dead tree meeja has bothered to investigate this.
I suppose this means the question in focus should be did large public sector organisations which had links with the VHI and the concept of a state operated monoploy insurer refuse to allow BUPA pitch for their group schemes?
As most people in these group schemes were under 65, surely it would have made things even more unbalanced (and caused the crisis to come sooner) if BUPA had been able to take some of their custom?
ReplyDeleteYou are probably correct in that the unions-operated schemes were probably biased against BUPA, but I do not think it made any difference in the long run?
It couldn't have made things even more unbalanced since many of the members of these group schemes are quite spread in terms of age distribution. Many would be in their late 40s/ 50s and so on.
ReplyDeleteThe lack of balance was not simply pivoted about 65 year old cut off point. People start to an increase in medical problems a good bit before 65.
In part I was raising the point here since it appears not to have appeared in any of the media coverage that the big problem in this implementation was that it favoured VHI as an existing player who was coming from a monoploy situation.
A great many older people simply did not move insurers. The big question is Why not? From my experience BUPA were cheaper and offered more coverage and potential reimbursements in comparison to VHI. Of course, that was my experience and that of people I've worked with, but why haven't the media run a proper story trying to find out why people did move? Was it because VHI was so fantastic, was it laziness or loyalty, or were people not offered a choice because they were in group schemes?