BUPA leaving Ireland

Re: Bupa leaving Ireland All Fermoy jobs lost

ubiquitous said:
...the proposed levying of €161m from a company making circa €60m per year seems odd to say the least.
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There doesn't seem to be any certainty about the figure of €161m. BUPA are bandying this around like it's fact. Someone from VHI was on Questions and Answers last night saying that the actual calculation in the first 6 months of 2006 would come to €7.7m! If that is correct, then it seems highly unlikely that BUPA would have to pay anything like €161m. On a very simple basis, if you double it up for a full year then you're looking at a figure closer to €15m. That is a long long away from €161m. Maybe they're both way off the mark. But it would help BUPA's case if they revealed how they came to €161m. They seem to be unusually shy about revealing any of their figures.
 
Re: Bupa leaving Ireland All Fermoy jobs lost

NuMarvel said:
This does give a good picture of how it works, thanks. But what if a company has a lower claims costs because it's driven better agreements with the medical centres/hospitals etc or if it incentivises it's member to get health checks? What if it takes steps to keep it's claims costs down? Shouldn't this also be recognised?
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Yes it should - and it is (or at least the system attempts to AFAIK). I gave the simplified version above but the actual mechanics are more complex based on standardised/expected costs at each age weighted by the age profile of each insurer. So in my example, it wouldn't strictly be: A has cost of claims 70M and B has cost of claims 90M - more along the line of: 'given A's age profile, the standardised cost of claims is 70M and given B's age profile, the standardised cost of claims is 90M - so there is a RE transfer of 10M'. Now if A actually only spent 60M due to efficiencies (no €500 taxis, shorter hospital stays etc.), then they get to keep that 10M efficiency improvement.
 
Re: Bupa leaving Ireland All Fermoy jobs lost

nicelives said:
Exactly but €500 plus for a taxi transfer from one Dublin hospital to another is what the Vhi pay out, there's the wastage. All this was highlighted on Joe Duffy, not my own personal experience as I'm with BUPA.
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sure, sure, sure.... me screens are lighting up here...... gooood afternoon to yuuuooooooooo, mary in clontarf......:D
 
Re: Bupa leaving Ireland All Fermoy jobs lost

roland said:
Someone from VHI was on Questions and Answers last night saying that the actual calculation in the first 6 months of 2006 would come to €7.7m! If that is correct, then it seems highly unlikely that BUPA would have to pay anything like €161m. On a very simple basis, if you double it up for a full year then you're looking at a figure closer to €15m. That is a long long away from €161m.
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Sorry but it doesn't make sense for a company making "huge profits" (your own words) to abandon a market for the sake of paying an extra cost of €7-€15m per year?
 
Re: Bupa leaving Ireland All Fermoy jobs lost

ubiquitous said:
Sorry but it doesn't make sense for a company making "huge profits" (your own words) to abandon a market for the sake of paying an extra cost of €7-€15m per year?
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Maybe not but do you have any evidence to back up this theory that they won't abandon the market for €15M a year? Have they stayed put in other countries when faced with paying an extra €15M a year?

VHI say it's 15M p.a., BUPA say it's 54M p.a. - so the real answer is somewhere in the middle - it's not just 15M pa that they are abandoning a market for - as roland accepted and a more complete quote would have clarified.
 
Re: Bupa leaving Ireland All Fermoy jobs lost

Sorry, I did not say that BUPA "won't abandon the market for €15M a year". I merely said that it would not make sense for them to do so, if they are earning the "huge profits" alleged by Roland.

If the business is viable after paying RE, then I am puzzled as to why BUPA didn't decide to sell the business to another operator rather than unilaterally exit the market.

Unlike you, I don't claim to have all (or indeed any) of the answers, so your request for evidence to support my comments is a bit superfluous?
 
Re: Bupa leaving Ireland All Fermoy jobs lost

ubiquitous said:
Unlike you, I don't claim to have all (or indeed any) of the answers
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???

Where do I claim to have all (or indeed any) of the answers??

I joined the thread to add some information (and some views) to a debate that was really just a big uninformed moan-fest. I don't have all the answers because BUPA do not publish detailed accounts and information, nor do they publish their board papers and internal correspondence and I don't have access to interview Martin O'Rourke, other senior executives, accountants, auditors and actuaries. And I don't have the VHI/VIVAS info/access either nor access to Mary Harney's department - all which I would need to be able to work out all the answers. I do, however, know how risk equalisation works and I'm happy if even a few readers of this thread know a bit more about it now.
 
Well with the rebuff of AXA's approach (why they would want to buy a loss making entity I don't know - maybe to launder some of those super-normal motor insurance profits??), it seems that maybe BUPA are not quite as set on leaving the irish market as once they seemed.
 
Well I got my letter in the post today confirming Bupa won't be renewing my membership, so if they do decide to return to the market, this is one customer they're guaranteed not to win back!

I find is so sickening that they were giving it the old "it's the public who will suffer" line, and being sorry for their workforce, but when another company offer to take over the operation, they refuse point blank. Nice to see how much they care really!
 
kit said:
Well I got my letter in the post today confirming Bupa won't be renewing my membership, so if they do decide to return to the market, this is one customer they're guaranteed not to win back!
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Even if they were more competitive than others?
I find is so sickening that they were giving it the old "it's the public who will suffer" line, and being sorry for their workforce, but when another company offer to take over the operation, they refuse point blank. Nice to see how much they care really!
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Maybe they weren't made an offer that they couldn't refuse?

For the record I used to be with BUPA and always found them better organised that VHI but have been with VHI for the past few years because the job chose them and pays for it (BIK).
 
They would have to be very very competitive for me to even consider them ever again. 50 or 60 quid a year certainly wouldn't tempt me!

As regards the Axa offer, surely something is better than nothing? If their reasoning is, as they say, that they may decide to re-enter the market, who's to say Axa (or some other company) won't have stated up by then? It's money for old rope really.

And if the do decide to re-enter the market, its not as if they'd automatically get their previous customers back, well not this one anyways!;)
 
they would not sell up and give their comp here in ireland to axa, as they are a competitor in england... would be a major kick in the goolies..
 
kit said:
I find is so sickening that they were giving it the old "it's the public who will suffer" line, and being sorry for their workforce, but when another company offer to take over the operation, they refuse point blank. Nice to see how much they care really!
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This is what I'm confused about. AXA are reported to say they're in "confidential & delicate" negotiations with BUPA about taking over the business, but BUPA say they've never spoken to AXA and they're not in negotitations (see [broken link removed]). I mean, either negotiations are happening or they aren't!

I wonder though is this all pie in the sky? AXA haven't said when they plan on starting the health insurance business, I think it took VIVAS over a year to actually set up, and I remember that Bank of Ireland were reported to be thinking about it at one stage, but that never transpired (naturally, I can't find a link to that anywhere, but I remember it was definitely reported!).
 
suppose the only thing is,vivas had to start from the beginning where as axa, have branches around the country, data bases on their system to target mail people, and have staff on phones, claims etc, might be alot easier for them to get up and running quicker.....
 
NuMarvel said:
I wonder though is this all pie in the sky? AXA haven't said when they plan on starting the health insurance business, I think it took VIVAS over a year to actually set up, and I remember that Bank of Ireland were reported to be thinking about it at one stage, but that never transpired (naturally, I can't find a link to that anywhere, but I remember it was definitely reported!).
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They haven't said they are interested in starting from scratch the way VIVAS did - they want to take over BUPA's business not start one of their own. If they can't take over BUPA, they probably won't set up as a health insurer.
 
interesting to see axa think they can make a profit and bupa can't !
maybe it's bupa who are not very efficient after all
 
scuby said:
interesting to see axa think they can make a profit and bupa can't !
maybe it's bupa who are not very efficient after all
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Well, if AXA are only interested in starting health insurance by taking over bupa's members (as theroised in another post) then maybe their only interested in short term profit. They'd generate the €60 off million that bupa said they'd make in the next three years, have the three year delay on the risk payments and only then would have to start paying.

I don't know why, but I just think that the timing of all of this is very convenient for everyone. I don't know what I'm implying, but I have to ask why AXA haven't come into the market before now if they were serious about offering cover. The risk payments obviously aren't a deterrent and with all the reports that Mary Harney is waiting on (competiton authority report and the review of profitability levels in the market), you'd think that a company would wait to see what transpires. I'm not saying the others are golden children either, but for some reason, I look at this and wonder what's really going on...
 
NuMarvel said:
I don't know why, but I just think that the timing of all of this is very convenient for everyone. I don't know what I'm implying, but I have to ask why AXA haven't come into the market before now if they were serious about offering cover. The risk payments obviously aren't a deterrent and with all the reports that Mary Harney is waiting on (competiton authority report and the review of profitability levels in the market), you'd think that a company would wait to see what transpires. I'm not saying the others are golden children either, but for some reason, I look at this and wonder what's really going on...
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Firstly, with the ahem 'exit' of BUPA, that would free up a lot of room in the market for a new entrant, there would more opportunities to generate profit than previously.
The second point is that they obviously feel that BUPA have been guilty of telling little white lies as to the level of payments that will be required for equalisation.
 
Glenbhoy said:
Firstly, with the ahem 'exit' of BUPA, that would free up a lot of room in the market for a new entrant, there would more opportunities to generate profit than previously.
The second point is that they obviously feel that BUPA have been guilty of telling little white lies as to the level of payments that will be required for equalisation.
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I don't understand why AXA should get a three year holiday on risk equalisation payments if they take over BUPA's business. I can understand it if it was a new entrant building up a client base from scratch and they needed time to gain market share and build a capital surplus. I for one would be very suspicious if AXA just took over BUPA's business that they don't have any long term plans to remain here. What odds on BUPA buying back the business in 3 years time?
 
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