Health insurance company wins appeal

Thu, 17 Jul 2008

Private health insurance company BUPA has won a supreme court appeal regarding the risk equalisation scheme within the health insurance market .

After months of legal wrangling, a court of five judges granted BUPA’s appeal against a high court rejection of their challenge to the scheme. The risk equalisation scheme, the judges said, was invalid due to a technicality.

The risk equalisation scheme was deferred from intended introduction in 2005. Designed to spread the claim costs of high-risk insurance policyholders, insurance companies with lower risk clients would have to compensate part-state insurance company VHI. The aim was for all insurers to share the costs.

The decision centres on a clouding of the meaning of the term ‘community rating.’ BUPA withdrew from the Irish health insurance market last year following difficulties in operating due to risk equalisation.
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