Reilly warns of serious service cuts

The health service is facing a spending cut of well over €800 million next year, much greater than was initially indicated by the Government, and health consumers are yet again facing extra charges.

Health Minister James Reilly had little in the way of good news to impart as he outlined the Government's Budget expenditure measures in health today. He admitted that there would be serious cuts in services in 2012 and these would present 'a real challenge.'

The Minister said it would not be possible to protect all services and there would be reductions in services.

One of the few crumbs of comfort offered was that the phasing in of free GP care would start as planned from next year, when 56,000 long-term illness scheme patients would no longer have to pay GP fees. It had previously been speculated that this plan might be deferred due to cutbacks.

But in a political embarrassment for Dr Reilly, he has been forced to do a u-turn on the pledge he made last March to abolish his predecessor's 50 cent per item medical card prescription charge.

The Minister said since the charge raised €27 million annually, it was not possible to abolish it at this time without adversely affecting frontline services.

He told journalists that the option of quadrupling the current prescription charge has initially been looked at, but he said it was still his intention that it should eventually be abolished in the future for those who are chronically ill and for the lowest earners.

Dr Reilly announced that monthly threshold over which people do not have to pay for drug costs under the Drugs Payment Scheme is being raised from €120 to €132, a measure that will save €12 million.

In addition, health insurers will have to pay more to cover the cost of patients being treated in private beds in public hospitals. The precise level of increase has yet to be calculated.

The Government will also in future charge insurance companies for private patients even if they are treated in public beds in public hospitals, by abolishing the current system of designated public or private beds.

The Government intends to collect an additional €143 million from insurers under these private bed measures in 2012.

This will inevitably lead to yet more increases in insurance premia next year.

However, Dr Reilly said health insurers also needed to bring down their cost base more, referring to the case of one consultant who was paid €1 million a year from an insurance company in private fees.

The Minister said said come consultants were being paid more than was appropriate from private insurance.

He said there were also many procedures currently carried out on private patients in hospitals that could be performed in primary care.

The Minister warned that some community nursing units for elderly patients would close in 2012.

The HSE is set to lose more staff next year, with 1,200 having applied to retire early from the health service to avail of favourable pension tax provisions before then are changed in February. This will cost an extra €97 million next year.

Overall health staff numbers are expected to shrink by between 2,000 to 3,000 next year, the Minister said.

Diminishing staff numbers are expected to add further pressure to services.

It is also planned to cut spending on overtime, premium payments and agency staff in the health service.

Dr Reilly said that health savings measures amounting to €543 million had been agreed by the Government

However, when other factors, including the carry-over the deficit from 2011 were taken into account, the real cut in the health budget could be of the order of €843 million.

He said costs that would have to be met include the EU equal pay agency staff directive, funding the Fair Deal scheme, VAT increases, pensions, and increments and increased health and social care demand-led needs.

He said while around €1 billion in cuts had been planned for 2011, this target had not been met - €800 million had been taken out this year with around €200 million carried over into next year's cuts.

Minister Reilly said the HSE's clinical programmes and his recently-established Special Delivery Unit (SDU) were making progress towards changing the way healthcare was being delivered, improving performance and cutting waiting lists.

He said the SDU had managed to reduce the numbers waiting over 12 months for planned treatment down to 948, with one hospital responsible for 676 of these patients.

Asked how these initiatives were going to do deliver real improvements in access to hospital care in the face of €800 million in cutbacks, the Minister said they were delivering in terms of 12 month waiters and the maximum wait would move down to nine months next year.

He said the SDU was looking at providing more beds in the community, more homecare packages more home help and intermediate care beds to provide to take pressure off hospitals.

Minister for Primary Care Roisin Shortall said discussions would take place on reducing further the price of patented drugs in 2012, and a system of reference pricing and generic substitution would also be introduced, which would lead to further cuts in drug costs.

In addition, there would be an initiative to reduce overprescribing.

It was also announced today that additional €35 million for mental health services is to be provided as promised under the the Programme for Government.

Budget blues - plus ca change?

[Posted: Mon 05/12/2011]