Private sector can save health service

COMMETN/Ray Kinsella: There was something Hutton-esque in the disclosures under the Freedom of Information Act of serious deficiencies in the infrastructure in the health service's public acute systems.

The correspondence provides a unique insight into the manner in which issues of major concern to clinical/medical staff are bounced between, on the one hand, hospital management and the Department of Health and Children and, on the other, Hawkins House and Merrion Street.

It needs to be said that the Department of Health and Children emerges with credit for forcefully arguing its case.

What is equally clear is that the Department of Finance remains true to its vocation of saying No or, more to the point: "Well, all right - but this will have to come out of next year's vote."

Having an official in the Department of Finance (no matter how senior) sitting in judgment on whether, or not, a piece of life-saving equipment is acquired for an acute hospital is wholly unacceptable from the perspective both of public and clinical governance. It's also bad economics.

At a quite different level, the catalogue of deficiencies that has been published highlights the fact that this is a systematic problem.

These weaknesses - beyond the control of local risk management - are like a virus embedded in the wider public system.

Delays and repeat tests are distressing to individuals. Scarce medical manpower can undermine the confidence and morale of both doctor and patient. They are also costly. From what has been revealed to date, it's an insurer's nightmare.

Dealing with deficiencies already identified will involve very significant costs. Something in the order of €350-€500 million will be needed just to get us back to where the public thought we were before any sought-after improvements or upgrades are considered.

The first category of expenditure cannot be delayed or phased in. Why? Because there is a knock-on effect in both diagnostics and surgery. The treatment capacity in the system is only as robust as its weaker link.

Second, the existence of these systems failures and deficiencies leaves the Government exposed to litigation.

It is worth making the point that there is a "natural" level of risk in any acute system. The point is that the catalogue of deficiencies which have been published adds to and magnifies these risks. Hence the urgency.

There are two issues that need to be addressed. The first has to do with reforming the policy process - including the whole issue of sustainable funding of the acute systems. The second, more immediate issue, relates to the auditing and funding of the existing difficulties within the acute system.

The two are integrally related. I have argued before that funding the acute system at anything like recent levels is simply not possible.

A new health strategy will have to start with the consultants, nurses, GPs and other front-line service providers. They know the needs and what's not being dealt with. They also know what "world best" system can be transposed to Ireland.

Once the priorities, problems and possibilities have been identified and shaped into a strategy, and costed, it could be passed to a public forum and an amended strategy sent to an all-party Dáil committee before being sent on to the Government.

Then there is the issue of funding the necessary upgrading and replacements identified in the recent Freedom of Information data. There will be a huge temptation to incorporate at least part of this into capital budgets for hospitals, going forward.

This should be resisted, both as a matter of principle and also because those deficiencies need to be funded immediately. In any event, capital budgets are already being cut. A robust platform needs to be created in order to meet the strains of demand and the challenge of risk - clinical and operational. That's why a separate audit of deficient equipment needs to be made - and funded - and accounted for in future votes in a transparent manner so that future upgrading and/or replacements can be benchmarked.

There are a number of options:

An increase in tax;

A reduction in expenditure elsewhere;

An increase in borrowing;

Re-engineering the SSIA Scheme, through the Social Partnership Forum to accommodate the costs of refurbishment.

Yes, there are financial (and political) issues. But acute healthcare is one of the very few issues that is so central that this must be an option, if it is agreed by the social partners.

More generally, whatever option - or mix - is taken, one thing is absolutely clear. There needs to be a rebalancing of the whole public/private mix.

The private sector needs to be encouraged to absorb a much greater part of the burden of expenditure and risk of funding acute healthcare. It is primarily the job of Government to develop protocols to ensure equality, access and quality and a sustainable volume of Exchequer funding.

The very large increase in funding in 1997-2002 - some 70 per cent in real terms - is history. Lessons can, of course, be learned But the acute system is stretched as tight as a violin string. We are operating above safe capacity levels.

This particular debacle will have served a purpose if it highlights the vulnerability of the acute system and concentrates on moving away from crisis management and "death by a thousand cuts" to a supply-side policy in which the private sector plays a much greater role in promoting equality and innovation, by shouldering a greater proportion of the expenditure and the risk.

Prof Ray Kinsella is director for insurance studies at the Smurfit Graduate School of Business and editor of the forthcoming book Acute HealthCare in Ireland: Changes, Cutbacks and Challenges.