The Health Service Executive has warned it may fail to achieve projected savings of over €400 million unless urgent action is taken to implement cost-cutting measures which were promised earlier this year.
Director designate Tony O'Brien said the HSE doesn't have the capacity "in itself" to address shortfalls which may emerge in a number of risk areas that are outside its controls.
Gross deficit
The health service has a gross deficit of almost €25 million at the end of April, Mr O'Brien said in the HSE latest's performance report. Significant and extended pressures on hospital emergency departments in the first four months of the year impact on costs and on the ability to sustain improvements in the system, he said.
Hospitals were €41 million over budget, though this was offset by underspending in other areas. St James’s hospital was €5 million over budget, St Vincent’s overspent by €4.3 million and the deficit at University Hospital Galway was €3.1 million, according to the report. Spending on high-tech drugs is running €17 million over budget.
Mr O'Brien listed a series of financial risk areas where large savings are being sought. A deficit of €65-€100 million is being projected in the area of medical cards, requiring "urgent need" for contingency measures to be implemented, he said. Following talks with the Department of Health, a draft shortlist of potential cost-cutting measures to be introduced has been drawn up.
The HSE hopes to make savings of €150 million arising from the Croke Park II process, which has not been concluded. Mr O'Brien said it wasn't possible at this point to be certain about how much of this saving will be delivered.
Legislation
New charges on private patients in public beds are projected to save €60 million but the legislation to effect this has only just been published.
Mr O’Brien expressed concern that advance payments made by private health insurance companies last year were now being recouped by the firms. He said urgent engagement was needed on the issue, where savings of €104 million were anticipated.
