Consumers and businesses in Ireland will be hit with rising health insurance prices in 2023, with premiums for some rising by up to 10pc, a new industry report says.
Medical inflation for 2022 has risen to 8pc in Ireland, a trend that is likely to continue for the foreseeable future, according to WTW’S 2022 Global Medical Trends Survey Report.
And the rising cost of health insurance premiums could see the market revert to a situation where people are again forced in significant numbers to drop their private cover due to a growing lack of affordability – similar to what happened more than a decade ago. the root cause of the financial crisis is that many are opting out of health coverage, according to one expert at a global insurance consulting firm.
The combination of Ireland’s aging population and the rising cost of providing healthcare to patients means rates are likely to rise in the sector even if some of the inflationary pressures on the economy dissipate, the WTW report said.
By 2022 medical inflation has risen to 8pc in Ireland, a trend that is likely to continue for the foreseeable future.
The immediate impact on health insurance companies for workers who haven’t locked in rates — and for the people paying the premiums themselves — will be a series of big increases in health insurance premiums in 2023 and beyond, David Glennon said. , director of WTW Health and Benefits Ireland.
“In recent years, health insurance rates have been stable and insurers have reduced premiums for their customers many times. The reason for this is that applications have dropped significantly during the Covid-19 crisis,” said Glennon.
“We are now seeing requests from private and public hospitals starting to return to normal levels, which will put pressure on prices.
“Although the increase will vary by programme, business plans can expect an increase of between 5pc and 7pc by 2023. Individual consumer plans may have even greater increases.”
One of the key factors driving higher rates in this sector is that both private and public hospitals are also demanding higher payments from health insurers due to increased pressure on their cost bases, he said.
“Almost all the money received from private hospitals comes from health insurance. “Their costs are skyrocketing and right now they’re all knocking on the doors of health insurance providers asking for money,” Glennon said.
The main reason for this increase in hospital costs is the severe shortage of staff and the increase in labor costs, said Glennon. Public sector pay negotiations have concluded with unions offering a 6.5pc rise over two years under proposals set out by the Industrial Relations Commission, while the 3% pay deal has been pushed back to February 2022.
The restoration of hours at Haddington Road has driven payroll costs up by 3.85pc.
Hospitals have also faced rising energy costs and general inflationary pressures, and after the drop in 2022 Health Minister Stephen Donnelly announced that health insurance levy would rise by €32 to €438 on a standard health insurance policy.
The report, which contains a comprehensive analysis of health companies around the world and includes data from two Irish insurers, suggested that all of these different cost pressures were set to grow on individual premiums next year.
