INDUSTRY REACTION:THE VHI said the Supreme Court decision to strike down the risk equalisation scheme could have serious consequences for older and chronically ill people.
The VHI's chief executive Jimmy Tolan said the company, which stood to receive around €40 million in risk equaliastion payments under the scheme, was "very disappointed" with the ruling. He said the VHI would have to adapt to the new environment.
"We will look at our business and review the decision very carefully. Community rating has always been central to the Irish health insurance system and risk equalisation is necessary to ensure community rating is implemented," he said.
Mr Tolan said the VHI's goal was to try to ensure that private health insurance could continue to be purchased on acceptable terms by its more vulnerable customers.
Former chief executive of Bupa Ireland Martin O'Rourke said the judgment represented "a wonderful day for consumers".
He said they would have better choice of products in the markets and that the ruling would mean community rating was protected.
The ruling was also welcomed by the other main companies in the sector, the Quinn Group and Hibernian Insurance. However, trade unions expressed concern at the decision. Siptu president Jack O'Connor said the decision had effectively "spelt the death knell of the co-existence of private and public medicine".
He said that the effective abolition of community rating would inevitably lead to inadequate provision for old age and illness.
"Many people who are already paying very large health insurance bills on top of their tax and PRSI contributions now face the prospect of having to pay even more. All this is happening against a background of continuing cutbacks in our public health service. It is time to face up to the need to create a universal health insurance scheme, based on the concept of contributions according to ability to pay", he said.
Trade union Unite, which represents around 800 staff in the VHI, said that the ruling would have severe consequences and would be raised at the national pay talks.
