Cash-hungry health system remains on critical list

Spending splurge appears to have disappeared down a black hole, writes Gretchen Friemann.

At the height of the Celtic Tiger, the policy of injecting massive piles of surplus Exchequer cash into the ailing health service seemed the quickest and simplest way of bringing about its much-needed recovery.

But, as at least one of the three reports into the health system is expected to show next month, the pay-off from the spending splurge has been disappointing.

Rather than translating into higher access rates at public hospitals and reduced waiting lists, it appears the reverse has occurred with mounting bed closures and overcrowded accident and emergency departments.

The extra cash seems to have disappeared down a black hole and the public perception is once more of a health system in crisis.

So what has happened to taxpayers' money and is the health strategy, launched six months before the general election, still a credible economic and strategic blueprint for the country's health system? Commentators and politicians argue that many of the goals of the health strategy already lie in tatters.

Crucially, the €13 billion in extra funds required to implement the strategy over 10 years, and that Taoiseach, Mr Bertie Ahern, publicly backed two years ago, now looks to be unrealistic in the face of the Department of Finance's demands for a reduction in public spending.

In an article published in this newspaper last year, Prof John FitzGerald of the Economic and Social Research Institute calculated that if the health strategy were to be implemented by 2011 at the pace envisaged by the Department of Health, "this would require current health spending to increase by nearly 20 per cent in 2003 from €8.2 billion to €9.8 billion and capital spending to double from €497 million to €942 million." This year, the total health spend, including capital funding to provide for new buildings, beds and equipment, will only reach €8.9 billion.

The reason for this reduction is not only due to the deterioration in the country's finances but is also, commentators argue, down to the lack of quality management and clear accountability.

Despite the 154 per cent rise in health spending since 1997, critics of the health service claim there is little evidence of value for money. Ms Olivia Mitchell, Fine Gael's health spokesperson, said that in 2001 when health spending was €5 billion, 26,382 people were waiting for treatment, but by the start of 2003 this figure had jumped to 29,017, despite a health budget of €9 billion.

A report commissioned by the Department of Finance and due out next month is expected to reveal a worrying trend of profligacy and mismanagement within the health service. The Brennan report, chaired by Prof Niamh Brennan of UCD, contains examples where projected budgets for specific policies or projects have resulted in huge financial overruns, such as the 2001 pay deal for childcare workers. Estimated at a cost of €4.7 million per annum, the final bill totalled €11.4 million, a figure that climbed to €45-€50 million when the knock-on effect to other grades was counted.

The Government's health strategy, titled "Quality and Fairness: A health system for you", states accountability is one of its four fundamental principles, along with equity, a people-centred focus and quality of service.

The strategy highlights that "better planning and evaluation models must demonstrate that available resources are used as efficiently and effectively as possible. Strengthening and clarifying accountability and measurement mechanisms will require action on a number of fronts." So far the accountability mechanisms in the health service have achieved little noticeable progress, with Prof Brian Nolan of the Economic Social Research Institute identifying the poor transparency of the health service as one of its biggest problems. "It's this lack of accountability between where the money is going and the perceived outcome of that money that is the chief problem. It really is shocking what a poor sense we have of what the funds provided have produced," he said.

With 96,000 people on the payroll, the health service is the biggest public sector employer in the State and the cost of employing such a vast number of people consumes around 70 per cent of annual health budgets.

Prof Nolan believes a poorly functioning health system is not a threat to a country's economy. "It's perfectly possible to have a first-class economy with a third-class public health system. Look at the US. Ireland will have to decide what sort of public health service it wants and how much money should be channelled through the Exchequer to pay for it."