Health Minister Mary Harney has warned that that between €600 million and €1 billion could be cut from the HSE's budget for 2011.
The Irish Nurses and Midwives Organisation (INMO) has warned that patient care will be severely compromised and frontline services significantly curtailed if this level of budget cuts is introduced in an uncontrolled fashion.
The Minister, attending an ESRI conference on health service funding today, said implementing the level of spending cuts needed in health next year would not be easy and the reduction could be as high as €1 billion.
She said the minimum reduction in the health budget would be €600 million.
The INMO reiterated its call for a crisis summit on the health service to be convened.
The Minister said that as pay cannot be cut next year as a result of the Croke Park agreement, making the necessary cuts in the non-pay element of the health budget would be very challenging.
She said staff redeployment would be crucial in order to maintain services.
Around €1 billion was taken out of the health budget this year, but much of this was taken up by public service pay cuts. However, the non-pay savings that were made still hit frontline services, and two of the HSE's four administrative regions ran up large deficits, necessitating cutbacks.
The INMO said its proposed health summit, which should be chaired by the Minister, would allow all stakeholders come to the table and challenged to produce new initiatives which would protect essential services in the context of our current economic situation.
"In return, the Government would have to acknowledge that there is a minimum level of funding required, in the short term, to maintain services required by ill and vulnerable people, which cannot be compromised or removed," the INMO said.
Stephen McMahon of the Irish Patients Association also warned of the dangers of taking up to €1 billion out of the health budget next year.
He said since, as the Minister indicated, 70% of the health budget was taken up with pay costs, and they largely cannot be touched in 2011, this meant that up to €1 billiion could be taken out out of the remaining health budget of around €4.5 - €5 billion, and this could could have a catastrophic effect on services.
Mr McMahon said while it was accepted that there had to be cuts, they needed to be balanced, measured and properly assessed. He said areas such as cutting absenteeism and hospital infection rates should be looked at for effecting savings.
Meanwhile, a healthcare expert today also warned of the dangers of implementing health cuts which could damage the system.
Prof Frances Ruane of the ESRI, who chaired a recent expert group on health service reform, said even before the current economic crisis, Ireland was facing major challenges in delivering on its stated healthcare objectives.
Addressing the ESRI conference, Prof Ruane said the current shortage of resources lended itself to cutting expenditure where it was easy to cut, risking much greater damage to the system than a systematic approach grounded in reallocating funds from where they have less benefit to where they have more.
However, she said there were key impediments to improvements, such as the historic power of vested interests in the health sector and the absence of structures to support the delivery of more cost-effective care.
Also addressing the conference, Aoife Brick of the ESRI said international evidence showed that measures to ensure sustainable health services should focus on those that reduce costs through efficiency rather than those that seek to shift the cost of care to patients.
She said since 2000, Irish public health spending has more than doubled in real terms to reach over €15 billion in 2009.
Prof Andrew Murphy, head of general practice at NUI Galway, told the conference that primary care GP services were the key to resolving Ireland's health service problems.
He said the drop of almost one-third in our heart disease death rates in the past 25 years had been delivered through primary care.
However, Prof Murphy said a key impediment to developing primary care in Ireland included the lack of universal patient registration with GP practices.
He said there was also a need to end the confusion over eligibility for services and for "the money to follow the patient."
Read more on the ESRI expert group report here
Also addressing the conference, Aoife Brick of the ESRI said international evidence showed that measures to ensure sustainable health services should focus on those that reduce costs through efficiency rather than those that seek to shift the cost of care to patients - taken from above. This is the method being used by Minister Harney's policy - make the patient pay and save money for the bonuses. Patients having to travel further to access services, patients having to pay more for those services, patients having to beg, borrow or steal to ensure they have the family covered by Private Health insurance, patients borrowing money to pay private fees to get treatment sooner, patient families having to pay costs of childminders and overnights to be with their sick relative in a distant hospital, - all makes health care much more expensive for patients.