VHI Healthcare says it remains over €50m short of financial sustainability, despite reporting a surplus of €7.4m for last year, according to its annual report for 2011.
The insurer has expressed concern at the rising cost of private beds in public hospitals.
VHI Healthcare says its hospital insurance business continues to be loss making but it is creating the financial environment to achieve long term sustainability.
Its latest annual report shows it made a surplus of €7.4m last year, compared with a loss of over €3m the previous year.
VHI has reserves of €295m, but it will need an extra cash injection of up to €250m to meet Central Bank regulatory status being demanded by the European Commission.
The company has expressed concern at the rising cost of private beds in public hospitals which have increased by 41% since 2009.
It says the rates charged are set by the Department of Health and are not subject to negotiation and has asked the Health Minister to look at the issue.
VHI chief executive Declan Moran said the company's business had been stabilised, despite a fall in members, people increasingly downgrading their cover and the increasing age of its customers.
It has engaged consultancy firm Milliman to examine the potential for further cost-saving measures.
The Consumers Association of Ireland has called on VHI Healthcare to "fight back" against increased charges for private beds in hospitals.
CAI Chief Executive Dermot Jewell said that "most VHI subscribers expect to see another hike in their premiums this year which they can ill afford and already many have dropped cover due to the soaring costs."
He said that the country and customers cannot sustain private health insurance increases.
