A spokesperson for Laya Healthcare has said the company will be reviewing and assessing a planned health insurance levy increase.

The Department of Health has written to insurers to advise them that the Government is to raise the levy by 10% from next April.

The Laya spokesperson said increases to the cost of private health insurance for members are unwelcome.

A statement from VHI, which has more older customers, welcomed the announcement.

It said the levy has increased support for older customers but said more needs to be done to support sicker customers by strengthening the health state aspect of the scheme.

The statement also said the levy paid is not inflationary and that every cent collected is given back.

Minister for Health Simon Harris earlier called on insurance companies to "think carefully" before passing on any planned increase in the health insurance levy.

He said a policy framework was already in place in relation to risk equalisation.

The minister said he would be bringing legislation on the issue to the Oireachtas shortly - perhaps as early as next week.

Mr Harris was speaking at the launch of a new guide for the parents of premature babies.

In a statement, the minister said the legislation is "to implement the recommendation of the independent Health Insurance Authority regarding increased credits payable to insurers, necessary to maintain a stable and sustainable health insurance market, and the level of stamp duty required to fund them.

"This is the way in which we ensure that everyone pays the same for their particular plan, regardless of age, health status or gender."

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An insurance expert has said the levy increase will "have to be passed on" to customers by insurance companies.

Speaking on RTÉ’s News at One, Dermot Goode of totalhealthcover.ie said that he was "surprised" by Mr Harris' comments that it was optional for insurers as to whether or not to absorb or pass on the new levy.

The comments were not welcome and would not give consumers any comfort, he said.

Mr Goode said if the minister is really concerned, he should instruct public hospitals to stop charging people who have health insurance "a new and additional private charge" when they do not get private services at public hospitals.

He said this measure was costing insurers an additional €150m.

Mr Harris also said he was hopeful that ongoing mediation between St Vincent's Hospital and the National Maternity Hospital at Holles Street would conclude shortly.

The talks, over plans to co-locate the NMH at the St Vincent's campus, are being mediated by Kieran Mulvey.