Dermot Goode, General Manager - Healthcare Division Cornmarket Group Financial Services Ltd 'Health Insurance - Now and in the future'

1. Health Insurance
“The market now and in the future”
Dermot Goode
- Cornmarket Healthcare Division
- www.healthinsurancesavings.ie

2. Presentation Overview
 Current Market
- Competition
- Price
- Consumer Trends
- Product Changes
 Looking Ahead
- Future for Community Rating
- Consumer Challenges
- Universal Healthcare
- Other Developments
 ‘Money Saving’ Tips

3. Health Insurance Landscape
 Three Insurers
 Level ‘Playing Field’
 ‘Tax Based’ Risk Equalisation Scheme
 New Government Proposals
 Affordability Issue
 Increasing Cancellations

4. Cost Drivers – Irish Market
 Health Insurance Levies
 Public Hospital Charges
 Normal ‘Medical Inflation’
 Increasing Claims Costs
 Ageing Population
 Age Profile of ‘Leavers’

5. Sample Price Analysis
1400
1200
1000
800 Jan-09
Jan-10
600 Jan-11
Mar-12
400
200
0
WL2 / L2H Ess Plus HP Access (Plan B)
Source HIA

6. Consumer Reaction
 Affordability is their biggest issue
 Split Cover / Dependent Deletions / Downgrades
 2.163 million insured (47.2% compared to high of 52%)
 66,000 cancellations during 2011
 106,000 now have cash plans only

7. Membership Statistics (HIA)
2,500 50.9% 51.2% 51.7% 50.6% 49.8% 47.2%
2,000
1,500
Total Insured Persons (000's)
Total Income (€m)
1,000
500
0
2006 2007 2008 2009 2010 2011

8. Health Insurance Products
 Over 200 plans
 Confusing terminology
 Special offers & 30 day pricing
 Product tweaks almost weekly
 Increasing role of the ‘Advisor’
 Financial Services Ombudsman

9. Changing Terms & Conditions
 Annual contracts
 Restricted illnesses
 Upgrade rules
 Credit for previous membership
 Consumers must read the ‘Small Print’

10. Looking Ahead
 Possible new entrant
 Higher costs for consumers
 More consumers exiting health insurance
 More product complexity
 Risk equalisation – new scheme
 Re-designation of private beds – public hospitals

11. Community Rating – Sustainable ?
 CR model needs a steady stream of younger members
 Present system is ‘creaking’
- younger ‘healthy lives’ are the ones exiting the system
 Some form or Risk Equalisation is needed – risks !!
 Minimum Benefits – reform needed ?
 Need to progress Universal Health Insurance

12. Consumer Challenges
 Affordability
 Higher premiums for reduced cover
 Making ‘like for like’ comparisons
 Covered for public hospitals only
 More may have to seek advice
 Impact on corporate clients

13. Universal Health Insurance (UHI)
- Points worth noting…
 Health insurance compulsory for all
 Consumers can opt for higher cover
 Hospital performance statistics
 More insurers to choose from
 How will it be funded
 Proper Risk Equalisation required
 Implementation lead time

14. Other Developments ??
 Lifetime Community Rating
 Higher Excesses
 Managed Care Model
 More Restricted Illnesses
 Cover for Selected Public Hospitals

15. Want to save money….
HP Access – Plan B (€1,364) / HP Extra – B Options (€1,644)
- One Plus Plan (€893)
- PMI 06 11 (€950)
Ess Plus (€1,480) / Ess Plus (with excess) (€1,240)
- Healthwise Plus – no excess (€878)
- Company Care Choice (€974)
Level 2 Hospital (€1,291)
- Level 2 Health Excess (€860)
- Business Plan Select (€951)

16. More ‘Money-Saving’ Tips
 Split cover
 Student rates
 Corporate plan equivalent
 Be sensible with your accommodation cover
 Mind those ‘special offers’
 Annual review

17. Any Questions
Cornmarket Group Financial Services Ltd is regulated by The
Central Bank of Ireland. A member of Irish Life Group Ltd.