‘On The Record’
Minister James Reilly today 27 February 2014 welcomed the launch of the Government’s Action Plan for Jobs 2014. The Action Plan demonstrates the Government’s commitment to create and maintain jobs in Ireland.
The Jobs Action Plan outlines the initiatives the Department of Health will take this year to progress the eHealth Strategy. It also includes actions to progress the Health Identifiers Bill and to publish the Health Information Bill, both of which are important to the health system but which can have enterprise benefit.
Minister Reilly said, “Last December I published the eHealth Strategy. This is an area which has been identified as having the potential to transform healthcare delivery systems. It also brings significant potential for economic development, including job creation, entrepreneurial start-ups and further direct foreign investment. The strategy seeks to exploit all of the many benefits which today’s ICT has to offer in modernising the way we treat patients and particularly in providing care in the most appropriate setting and at the most appropriate level within the health services.”
Continuing Minister Reilly said, “Another key initiative is the Health Innovation Hub. Last year’s Action Plan and this year’s Action plan include measures to bring this initiative to fruition. Good progress is being made through the Demonstrator (pilot) in Cork with a second round of projects being examined for engagement with the Demonstrator. This provides a unique opportunity for enterprise and the health system, and my Department will continue to work with the Department of Jobs, Enterprise and Innovation to bring proposals for Government consideration later in the year on the steps required for the establishment of a national Health Innovation Hub.”
Also included in the Action Plan for Jobs are initiatives which the Health Research Board, an agency of the Department of Health, will continue to progress. In particular the HRB will continue to take steps to establish Clinical Research Facilities (CRFs) in Dublin, Cork and Galway and provide a collaborative framework to link all CRFs by 2016. A robust clinical research infrastructure, including highly specialised expertise and capacity, is essential in development and delivering health care and 8,000 participants have taken part in clinical studies in these CRFs so far. Their establishment will also facilitate closer collaboration between the health system and industry.
Address by the Minister for Health Dr. James Reilly T.D. to the Select Committee on Health Estimate for 2014
Chairman, I am pleased to have the opportunity to address the Select Committee today on the Revised Estimates for 2014 for my Department (Vote 38) and for the Health Service Executive (Vote 39).
Copies of the Revised Estimates for the Health Votes, and briefing documents by subhead on the two Votes have been provided to the Deputies. As you are aware, the annual estimates are being reconfigured along programme lines, to ensure greater transparency in Government expenditure. The Department of Health is working towards the development of Programme Budgeting and changing the structure of the Health Votes to reflect this. This will take some time, however, as the financial systems in the HSE will have to be adapted to allow for this in the context of the financial reform programme currently underway. In the interim, the appendices to the Revised Estimates for the Health Votes have been constructed along programme lines – based on the HSE National Service Plan– to provide a high-level programme breakdown of health expenditure. In addition, 2 programme subheads (PCRS and long term residential care) are now included in the REV; the third programme for which information had been extracted – the Children and Families Directorate – is now funded through the Department of Children and Youth Affairs following the establishment of the Child and Family Agency.
Before looking at the estimates in detail, I would like to make a few general observations about the overall budgetary situation facing the health sector. As the members of the Committee are fully aware, this Government is committed to tackling Ireland’s very serious deficit problem. Current health expenditure in 2014 will account for 27% of Gross Current Expenditure, meaning that fiscal realignment must, of necessity, impact on health sector spending.
Health Reform Programme
The challenges facing the health system at a time of growing demand means that this Government must press ahead with major health sector reform. I will continue to deliver the Government’s programme of health reform throughout the course of this year, and I am pleased that the HSE has set the advancement and implementation of these reforms at the centre of its planning for 2014, including, but not limited to;
• Phased implementation of a Money Follows the Patient funding system in hospitals;
• The transition to hospital groups including appointment of new Group CEOs where required;
• The establishment of new Community Areas with associated governance and organisational arrangements; and
• The establishment of a Patient Safety Agency;
In 2013, we published Healthy Ireland – our strategy for improving the health of Irish people and enhancing our health and wellbeing. It is an ambitious strategy which aims to embed health and wellbeing across public policy and services, and sets out a whole of Government and cross-sectoral approach to address the demands placed on health and social care services from the growing incidence of chronic illnesses together with the challenges of an ageing population.
Chronic diseases such as cancer, cardiovascular and chronic respiratory disease and diabetes are the leading causes of mortality and account for over three quarters of all deaths in Ireland. The risk factors associated with the increased prevalence of chronic diseases, such as obesity, lack of exercise, unhealthy eating patterns, over consumption of alcohol, and use of tobacco products are generally preventable. Healthy Ireland is critical in terms of enabling the required shift in emphasis towards health prevention, promotion and improvement in the years ahead.
Progress over recent years
The 2013 edition of Health at a Glance published by the OECD shows that Ireland continues to make substantive headway in improving health outcomes. Mortality due to cancer fell by 21%, ischemic heart disease by 59% and cerebrovascular disease by 54% between 1990 and 2012 and in all three instances the rates of improvement in Ireland were above the OECD average. Life expectancy in Ireland has increased by a full four years since 2000 to reach 80.6 today, again above the OECD average.
Now I would like to address the estimates for health in some detail.
The Revised Estimate for 2014 for the Health Group of Votes provides for gross expenditure of €13.164 billion for health services. Of this amount, some €12.774 billion is for current funding and €390 million for capital funding. A further €544 million (€537m current and €7m capital) in relation to children and family services is funded through the newly established Child and Family Agency under the aegis of the Minister for Children & Youth Affairs. Significant cost extraction is required with €619m in savings to be achieved in 2014. The primary aim in targeting savings is to cut the cost of services and not the services themselves. This will be achieved largely through efficiencies and re-configuration under the Croke Park and Haddington Road Agreements, new charging arrangements for private patients in public hospitals and curtailing the growing cost of pharmaceuticals.
The required savings have been incorporated in the HSE Service Plan which was published on 18th December last, and are recognised in these Revised Estimates before the Committee today.
Vote 38 – Department of Health
The funding for Vote 38 provides for gross expenditure of €206 million. This comprises €16m capital and €190m for current expenditure. This represents a 6% reduction on the provisional outturn position for 2013, and it represents a 17% reduction on the 2013 budget. All health agencies funded by my Department were required to achieve further efficiency savings this year, with the Department’s Administrative budget being reduced in line with the moratorium on recruitment and the provision for legal costs and statutory enquiries also reduced. The provision for the National Treatment Purchase Fund has also been significantly reduced, pending consideration of its future role in the context of the structural reforms set out in Future Health.
In addition to the funding reduction, some €22m was transferred from the Department’s Vote to the HSE, in the context of the Drugs Initiative. The funding will be used to support approximately 220 Drugs Task Force projects in respect of which the HSE has acted as “channel of funding” for a number of years. The HSE also provides funding to a significant number of the same drugs projects from its own vote. The HSE funded projects are subject to the standard governance and monitoring procedures of the HSE. Separate reporting, accountability and monitoring arrangements had applied to projects funded by the Department through the “channel of funding” arrangement.
Allocations to Drugs Task Forces will continue to be based on Drugs Task Force recommendations and will continue to focus on tackling the drug problem. Transfer of operational responsibility for funding administration of Drugs Task Force Projects to the HSE is a key priority in the HSE Primary Care Operational Plan 2014.
Some €7.4m remains in the Department of Health Vote for 2014, €6.6m of which is in respect of expenditure on 100 community drugs projects The remainder funds the activities of the National Advisory Committee on Drugs and Alcohol, the Family Support Network and the Citywide Drugs Crisis Campaign, which represents the community sector.
Vote 39 – Health Service Executive
The gross provision for the HSE is €12.958 billion comprising an exchequer contribution of €11.553 billion plus Appropriations-in-Aid of €1.405 billion. This is made up of €12.584 billion in current expenditure, and €374 million for capital expenditure.
As Members will be aware from discussions on the National Service Plan, some €537m has transferred from the Vote of the HSE to the Vote of the Minister for Children and Youth Affairs following the establishment of the Child and Family Agency, which is now responsible for funding Children and Families services
In addition to this adjustment, the revised Estimate for the HSE includes additional health funding of €47 million over and above the Budget provision and €22 million referenced earlier in relation to the drugs programme.
The Health Service Executive is required to achieve savings measures of €619 million next year in order to remain within the 2014 Health expenditure ceiling.
As with last year, the significant cost of drugs and medicines has been targeted for savings measures. In recent years, a number of changes to the pricing and reimbursement system have been successfully introduced, primarily through pricing and supply agreements with the pharmaceutical industry, and we have made good progress in addressing the cost base. With the passing of the Health (Pricing and Supply of Medical Goods) Act 2013 we now have a robust system of reference pricing and generic substitution and we have already reduced the cost of atorvastatins by some 70%.
More reductions will follow in 2014, and some €50m in targeted savings are built into the budget for PCRS. This saves patients money and saves taxpayers’ money, allowing us to focus on maintaining frontline services.
The 2014 Estimate also provides for the full year effect of the reductions to professional fees paid to GPs and pharmacists under the Financial Emergency Measures in the Public Interest (FEMPI) Act 2009. Overall these reductions will save in the region of €70 million in a full year, half of which was achieved in 2013.
Medical Card Probity & Haddington Road
The savings targets in relation to medical card probity and the demanding set of savings targets under the Haddington Road Agreement were discussed at length with the Joint Committee on 14th and 16th of this month, and I do not propose, therefore, to go into any further detail on these now. Suffice it to say that my Department will be working closely with the HSE and with the assistance and support of the Departments of An Taoiseach and Public Expenditure and Reform to ensure that savings from these measures are maximised.
In setting the Estimate for the HSE, tough decisions had to be taken by Government given the need to take corrective action in relation to public spending. The health service must, of necessity, contribute to the expenditure reductions required in 2014, but the Government’s objective has always been to ensure that these reductions are achieved in a way that secures the best possible outcomes for those in receipt of services, with a particular focus on protecting services for the most vulnerable. To protect services, we need to reduce costs and improve productivity.
Capital Investment 2014-2018
Suitable and appropriate facilities are required in order to provide safe and cost effective health care. Recent capital investment has brought about a significant improvement in the standard of facilities across all care programmes. Nevertheless, a significant proportion of the health care infrastructure is old, and, therefore, generally unsuitable for contemporary health care delivery.
The HSE has submitted its draft Capital Plan for the multi-annual five year period 2014-2018. This is under consideration and requires my approval with the consent of the Minister for Public Expenditure and Reform.
For the multi-annual five year period 2014-2018, the major priority projects are – the Children’s Hospital, the Central Mental Hospital, the relocation of the National Maternity Hospital, the National Programme for Radiation Oncology and the continued roll out of primary care infrastructure in line with the National Primary Care Strategy. In addition the refurbishment programme for the Community Nursing Homes and residential mental health facilities must be progressed.
Considerable progress is being achieved on numerous projects over all health care groups nationally. Facilities which are due to become operational in 2014 or early 2015 include
- 21 PCC centres;
- 38 facilities in the Acute sector;
- 9 facilities with 348 beds for the Older People CNU refurbishment programme;
- In relation to Mental Health, 16 facilities will be delivered; eight of which will provide 212 beds. Associated with this programme is an additional 18 high support residential places which will be provided for persons with disabilities who are currently resident in mental health facilities.
Chairman, the health services had a lot of investment of taxpayer’s money during the good years, but there hasn’t been the degree of improvement that the people have a right to expect. This Government fully intends to correct this, even in these difficult economic times. Our reform agenda, while ambitious, will be delivered.
To conclude, I thank the Committee for its attention and I commend the estimates for the Health group of Votes to the Committee. I will of course be glad to supply any further information or clarification that Members may request.
Check against delivery
Speech by Ms Kathleen Lynch TD, Minister for State at the Department of Health on a Topical Issue Debate regarding the provision of ambulance services. I would like to thank Deputies Adams and McConalogue for raising these issues today and at the outset to express my sympathies to the families involved.
In relation to the response of the National Ambulance Service (NAS) to the incident raised by Deputy Adams, the NAS has reviewed the incident and has confirmed that at the time of the call, there was high call activity in the area. The NAS is, however, satisfied that the call was appropriately prioritised, using the Advanced Medical Priority Dispatch System, and that the closest available ambulance was tasked. Read the rest of this entry »