Reilly criticises VHI's €1m payment to consultant as 'grossly out of step'

THE PAYMENT by the VHI of some €1 million to a consultant doctor last year was criticised by Minister for Health Dr James Reilly.

He said he was not satisfied that any consultant should be paid that amount of money in a single year.

“This level of remuneration is grossly out of step with most ordinary people’s expectations,” he added. “The individual, whom I do not know, is working hard in a system that over-rewards.”

Dr Reilly said there were only so many procedures one could carry out safely in a week.

“If this level of remuneration is available to people who work hard and safely, the service provided is grossly overpriced,” he added.

The Minister said he was dissatisfied that several other consultants also earned enormous sums from the VHI and, to a lesser extent, from other insurers in recent years.

The Minister was replying to Tom Fleming (Ind), who said the office of the Comptroller and Auditor General should investigate the manner in which the VHI negotiated prices for various medical procedures with consultants, and the daily cost of hospital beds.

Dr Reilly said that while owned by the State, the VHI was a not-for-profit company operating in a competitive market and negotiated directly with the service-providers on pricing.

While it would be inappropriate for any Minister to intervene directly in matters relating to prices, he had concerns about the claim levels and, in particular, the cost of services being provided to and paid for by the VHI, he said.

The company was acting on behalf of consumers and should have done more to control costs, he added. However, he said the Comptroller and Auditor General’s office had no audit powers relating to the VHI and was not the appropriate regulator.

Mr Fleming said he was disappointed to hear that the Comptroller and Auditor General did not have a role in the matter.

“The remuneration received by the consultant is mind-boggling and many people are incensed when they read about these exorbitant sums,” he added.

Mr Fleming said consumers were being ripped off and were probably paying the highest premiums in Europe.

He urged the Minister to develop a step-by-step plan to ensure private health insurance would be more affordable by the end of the year.

“At present, many individuals have been ruled out of the market,” said Mr Fleming.

Dr Reilly said while he was deeply concerned about the current position, he must acknowledge the VHI had made attempts to save money during the year.

There had been a 15 per cent reduction in consultants’ fees and a 6 per cent reduction in private hospital fees per procedure.

In addition, said Dr Reilly, there had been an annualised reduction in internal administration costs of €14 million.

“These actions have generated annualised savings of €100 million but in my view they do not go far enough,” he added.

Dr Reilly said he would endeavour, on behalf of the people, by means of appointments to the board and through the appointment of a new chief executive, to ensure that driving down costs would become the focal point of the VHI’s activities.