New levy to be introduced on health insurance

The Government is to introduce a €300 million tax relief scheme to subsidise health insurance costs for subscribers aged 50 and over.

It is to pay for the scheme by introducing a new €160 levy on companies for every adult with health insurance. This may or may not be passed on to consumers. The Government move follows the Supreme Court decision in July which struck down the risk equalisation scheme that compensated insurers with more older people on their books. Under the new measures, a new “community rating levy” of €160 for adults and €53 for children will be placed on insurance companies. Tax relief will be introduced for health insurance for those aged 50 and over. The additional tax relief will be €200 for those aged between 50 and 59, €500 for those between 60 and 69 years of age, €950 for those between 70 and 79 and €1,175 for those 80 years of age or more. The implementation of the measures is subject to approval by the European Commission.