Health investment review exposes mounting problems

The Irish health system has some of the longest waiting lists, lowest hospital bed capacity and highest bed occupancy among western European countries, according to new research.

The analysis of historical investment in healthcare by the Department of Health lays bare the long-term challenges facing the healthcare system. And it comes as the service struggles to cope with a fourth wave of infections in the 20-month coronavirus pandemic.

The report indicates that Irish healthcare capital spending between 1970 and 1966 was two-thirds that of other EU countries, leaving the Republic’s health system with higher average acute-care occupancy at 90 per cent compared with 79 per cent for the “EU15” countries in western Europe.

The State has low acute-care bed capacity with an average of three beds for every 1,000 people in 2019. This compared with 3.9 beds in the EU15 and 4.7 beds in the developed Organisation for Economic Co-operation and Development countries.

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The Republic has some of the longest waiting times in the EU15 for various procedures. It had 622,963 people waiting for outpatient procedures last January, when in-patient and day case waiting-list numbers were 81,456.

“The low level of investment in healthcare historically in Ireland likely continues to impact the modern Irish health system, both in terms of the structure and distribution of investment, and in terms of the capital stock currently held within the sector,” noted the report.

The analysis found that growth in current expenditure on the health service has been prioritised over capital expenditure, resulting historically in a small proportion of overall spend.

“While healthcare capital investment makes up approximately 10 per cent of the overall health budget, its impact on the capacity to deliver care in a region or service area is far greater,” stated the report.

Regional investment

A separate report on strategic considerations on the future of investment in healthcare found a possible lack of regional diversity in investment, with Dublin accounting for 47 per cent followed by Galway with the next greatest share at 7 per cent, Cork with 6.5 per cent, Limerick with 5.5 per cent and Sligo with 2 per cent.

“This may run counter to the expected investment under the National Planning Framework, which calls for balanced regional growth,” noted the report.

Questioning the long-term feasibility of projects, this report found that 76 per cent of expenditure under the 2018-2027 National Development Plan has yet to take place.

It concluded that more than €4 billion, or 42 per cent of the planned investment, is at the “appraisal” stage where uncertainty is greatest “due to the absence of a detailed brief and market engagement. Therefore, the uncertainty around this €4 billion estimate is large and presents risks in the form of noise” – unwanted variability in professional judgments – “underestimation bias [and] optimism bias.”

These risks have been seen in cost overruns at the National Children's Hospital and National Maternity Hospital, the report notes.

Risk in healthcare investment

A third report on dealing with uncertainty and risk in healthcare investment found that the final cost of six projects valued at more than €100 million, now at appraisal stage, could increase 66 per cent or €1.4 billion on the 2018 estimates to deliver the projects.

Separately, a review into a pension bonus scheme for public servants found the scheme “difficult to justify”.

The review examined Professional Added Years, a scheme in which additional years of service are added to some public servants pensions, where they work in certain specialist or technical roles.

The spending review noted a “lack of transparency” around ongoing costs of the scheme, which is available for public servants employed prior to 2013. The review found even a small award of extra years to someone’s pension “can have significant capital cost implications over the life of a pension”.

The pension bonuses are “generous and difficult to justify in the current broader pensions policy and sustainability context”, it added.