The person now simply described as Ireland’s richest man, Seán Quinn, looks set to fight the Irish government after emergency legislation was passed in the Dáil to close a loophole in risk equalisation legislation. Despite the move, the Quinn Group has confirmed it is to go-ahead with its takeover of health insurer BUPA Ireland even though the emergency legislation on Wednesday night will probably cost the company tens of millions over the next three years.
The Cabinet kept its intentions secret until the close of business at 6pm or else Quinn or Vivas, the other health insurer in the Irish market, could have re-registered with the Health Insurance Authority to avail of the loophole. Vivas actually would have only had to change underwriters. Such a move would have allowed them to take advantage of another three-year exemption from making risk equalisation payments, compensating the VHI for its older customers base.
Mary Harney, Minister for Health and Children, has since welcomed the subsequent decision of the Quinn Group to continue with its takeover of Bupa but the company has reacted angrily to the steps taken.
Bupa announced it was pulling out of the Irish insurance market after a failed High Court challenge against risk equalisation last November but last month Quinn stepped in and bought the company for a rumoured €150m.
This certainly isn’t the end of the story and with a personal fortune estimated at around 2 billion euros Quinn certainly has the financial clout to take on anyone, including the State.
Apart from a lenghty legal battle, changes that could be on the cards include higher premiums for older people taking out insurance for the first time as well as a tighter schedule for VHI to work on the same financial basis as private companies.
Earlier this month, the Irish Competition Authority said risk equalisation in Private Health Insurance Market will reduce competition and put up prices.