Health insurance: penalised for age?

I'm just looking at this VHI policy: One Plan 250

Show price breakdown
This price is for: One Adult aged between 26 and 34 and the start date shown. If you match this description, you can buy this plan without needing a quote. If your details differ, simply get a quote. Please note waiting periods may apply, see Terms and Conditions.

Always check the benefits before you buy.

I thought they weren't allowed use age to determine the cost of health insurance policies anymore?

Del2005

It's one of the many inconsistencies in discrimination law that a lot of discrimination is allowed!

It's supposed to be an incentive to get healthy young people to pay for older unhealthy people as due to group rating there was no need to get health insurance before you got old.

Jim2007

Deleted User wrote: »

I'm just looking at this VHI policy: One Plan 250



I thought they weren't allowed use age to determine the cost of health insurance policies anymore?

They can't refuse to insure you because of age, but it is most certainly a determining factor in calculating premiums and rightly so.

manonboard

I thought we all pay the same health insurance premiums over here.

My mums cost the same as mine (i pay both).

I thought it was a way to not load old people with higher costs by keeping the market profitable, etc

Atlantic Dawn

As far as I know this is because at age 35 if you have had not had health insurance before there's a loading on it to compensate for people who have never had health insurance all their life and then decide to take it out aged 60 or so when they are more likely to become ill. Every year after 35 there's a loading of 2% on what someone would pay if they had insurance since age 34, more info here...

http://health.gov.ie/blog/publications/introduction-of-lifetime-community-rating-lcr-to-the-private-health-insurance-market-faq/

Atlantic Dawn

Atlantic Dawn wrote: »

As far as I know this is because at age 35 if you have had not had health insurance before there's a loading on it to compensate for people who have never had health insurance all their life and then decide to take it out aged 60 or so when they are more likely to become ill. Every year after 35 there's a loading of 2% on what someone would pay if they had insurance since age 34, more info here...

http://health.gov.ie/blog/publications/introduction-of-lifetime-community-rating-lcr-to-the-private-health-insurance-market-faq/

But that wording does not indicate that at all. I have been insured before/currently have health insurance but it's not asking me that. In fact, as soon as I put in my date of birth it says: 'This purchase option is only available to adults aged between 25 and 34. If you do not match this criteria, please get a quote.'

manonboard

manonboard wrote: »

I thought we all pay the same health insurance premiums over here.

My mums cost the same as mine (i pay both).

I thought it was a way to not load old people with higher costs by keeping the market profitable, etc

This has been my understanding of the change in Irish law, too. In exchange, the Irish government in effect gave a huge handout to private health insurance companies by penalising everybody over 35 who did not take out insurance before May 2015. By changing the law like that it forced loads of people to give money to private insurance companies earlier than they might otherwise have done.

From Citizens Information.ie

Community rating
"Community rating" means that the insurance company must charge the same rate for a given level of service, regardless of age, sex or health status. So all adults pay the same amount for the same benefits. Unlike motor insurance or life insurance, matters such as age, sex, sexual orientation, health or past record of claims do not affect the price charged for insurance.

Charges may be lower than the normal adult rate for: people aged under 25; retired people who have a special arrangement within their company's health insurance scheme and people in group health insurance schemes. Charges for children must be reduced by at least 50%.

Lifetime community rating
Higher charges apply to people who are 35 years of age or older when they first take out health insurance. There is a 2% loading for each year over 34 years of age. So, for example, if you are 35 the cost is 2% higher than for a person aged 34 but if you are 44 then the cost is 20% higher.

If you previously had health insurance, you can be given credit for the time you were insured, reducing the number of years to which the loading applies.

If you have a break in cover of less than 13 weeks this will not affect your loading.

If you stopped your insurance cover for periods of unemployment since 1 January 2008, up to three years of credits can be provided.

Sleeper12

Deleted User wrote:

I thought they weren't allowed use age to determine the cost of health insurance policies anymore?

They aren't. Everyone over 34 needs a quote as they have to verify that there are no loadings on you due to lack of cover. For example at 50 years of age I pay the same amount as a 25 year old but I have show proof that I was covered since I was 34. If I wasn't then they would load the me 32 percent

coylemj

Sleeper12 wrote: »

They aren't. Everyone over 34 needs a quote as they have to verify that there are no loadings on you due to lack of cover. For example at 50 years of age I pay the same amount as a 25 year old but I have show proof that I was covered since I was 34. If I wasn't then they would load the me 32 percent

That doesn't answer the OP's query. There's nothing to stop them giving you a quote 'subject to you being able to provide proof of continuous cover since age 34'. In the same way that you can get a online quote for motor insurance subject to you producing a full driving licence and a cert. from your existing insurer to backup your stated no-claims history.

Instead they are politely telling the OP that he cannot avail of that package because he's too old which smacks of cherry picking. Even when he attempts to get a quote by entering his details, they are telling him to PFO once they see he/she is >34.

notharrypotter

Deleted User wrote: »

This has been my understanding of the change in Irish law, too. In exchange, the Irish government in effect gave a huge handout to private health insurance companies by penalising everybody over 35 who did not take out insurance before May 2015.

More like to curtail the practice of strategic deferal by people who otherwise would simply wait until they are much older and sicker before purchasing health insurance.

Sleeper12

coylemj wrote:

That doesn't answer the OP's query. There's nothing to stop them giving you a quote 'subject to you being able to provide proof of continuous cover since age 34'. In the same way that you can get a online quote for motor insurance subject to you producing a full driving licence and a cert. from your existing insurer to backup your stated no-claims history.

But the insurance company doesn't have to do this. They can quote anyway they want so long as everyone gets the same price.

There is nothing to suggest in the op that people over 34 will pay more.

coylemj

Deleted User wrote: »

This has been my understanding of the change in Irish law, too. In exchange, the Irish government in effect gave a huge handout to private health insurance companies by penalising everybody over 35 who did not take out insurance before May 2015. By changing the law like that it forced loads of people to give money to private insurance companies earlier than they might otherwise have done.

The previous system was unsustainable and would eventually have pushed the VHI (with it's older age profile) into bankruptcy.

What happened in the 1990s was that Mary Harney held out a carrot to entice new entrants into the market. The deal was that they got a 'holiday' from having to chip into the community fund, the mechanism by which companies with younger members paid money to compensate companies (principally the VHI) who had an older member profile.

Enter BUPA from the UK who immediately set about cherry-picking the market with goodies aimed at younger people like extra maternity benefits and subsidies for laser eye treatment. They also signed up a lot of US companies who paid their staff medical insurance as an employee benefit so we're talking about the likes of Microsoft, HP etc. - companies with a predominantly younger (and healthier) workforce.

At face value, this might have made sense from the perspective of public policy - create a competitive insurance market, reduce administration costs by having leaner and more efficient companies and reduce premiums all round - great! Instead, as soon as their holiday ended, what did BUPA do? Simple, they upped sticks and took themselves back to the UK with several hundred millions euros worth of premiums from healthy young Irish people, leaving the VHI with it's back to the wall. It was a classic 'smash and grab' which should have been foreseen from the start.

The present system may not be perfect and some may see it as subsiding private business but there has to be an incentive to sign up for medical insurance when you are young rather than wait until your joints start creaking or cancers and illnesses associated with old age come calling.

eeguy

notharrypotter wrote: »

More like to curtail the practice of strategic deferal by people who otherwise would simply wait until they are much older and sicker before purchasing health insurance.

But thats how insurance in general should work?

You insure yourself on the chance thay something bad happens.

How insurance shouldn't work is that everyone pays the same regardless of situation. It's even worse now as you're penalised for not taking out insurance when you didnt really need insurance in the first place.

coylemj

eeguy wrote: »

How insurance shouldn't work is that everyone pays the same regardless of situation.

You can't let medical insurance operate in the same way as motor insurance. If it did, nobody under 40 would buy it and as soon as they reached middle age and actually needed it, it would be unaffordable.

eeguy

coylemj wrote: »

You can't let medical insurance operate in the same way as motor insurance. If it did, nobody under 40 would buy it and as soon as they reached middle age and actually needed it, it would be unaffordable.

I understand that, but penalising people for not buying an optional product is wrong.

coylemj

eeguy wrote: »

I understand that, but penalising people for not buying an optional product is wrong.

Medical insurance is optional all the way from the cradle to the grave. But if you arrive late to the party, there is a fee for late entry. And proper order too.

eeguy

coylemj wrote: »

Medical insurance is optional all the way from the cradle to the grave. But if you arrive late to the party, there is a fee for late entry. And proper order too.

I just let my company pay for it.

gustafo

I won't be paying for it anyway total rip off, typical banana republic we live in,

at the end of the day if you go to hospital with a serious problem they have to treat you whether you have insurance or not they can't leave you die, and if you havn't the funds to pay for the treatment what can they do.

coylemj

gustafo wrote: »

.... and if you havn't the funds to pay for the treatment what can they do.

Leave you to hobble around in pain with a gammy knee or a rusty hip for 10 years?

Or how about waiting two years for a colonoscopy in a public hospital, to then discover that you have untreatable bowel cancer?

Good luck.