Hospital budgets are in a critical condition

Over-spending by hospitals is running at twice the rate it was this time last year. And there’s little sign the trend is going to change, writes Claire O’Sullivan

JUST five months into the year and already the HSE hospitals budget has derailed once more. The hospital sector alone is now €101m over-budget, with hospital management having spent €1,659m rather than the €1.558m it is allocated.

Latest hospital expenditure figures show that some hospitals in the country have over-spent by as much as 10%-28% up to the end of the May.

These include: Kilcreene Orthopaedic Hospital in Kilkenny, which is 28% over-budget; University Hospital Limerick (UHL), which is 18% over; Waterford Regional Hospital, which is 12% over; Mercy University Hospital and South Tipperary are both 18% over-budget, while South Infirmary in Cork is spending 16% more than its allocated budget to date.

Our Lady’s Hospital, Navan, is 17% over-budget already while the Royal Victoria Eye & Ear is spending 13.55% in excess of its allocation.

In 2012, the HSE went over-budget by €500m. Last year, it over-spent by €350m, requiring a €200m bailout and €150m of extra savings. This year, it is on course to run a deficit of €500m.

This time last year, there was a €52.91m gross deficit in the hospitals budget — so this year, Irish hospitals are over-spending by nearly twice as much as last year. So why is this happening? And why can’t they get things under control?

Talking to hospital consultants, local politicians, and hospital management, there isn’t one common problem facing the hospitals’ finance teams — beyond the obvious: A desperate lack of cash, as €1bn has been cut from the health budget since 2008.

Staff say an array of structural, political, and economic decisions are behind the yawning gap between allocated budget and expenditure.

The greatest budget overruns are in the University of Limerick Hospital Group, with an 11.73% overspend, while in Dublin North East it’s just 5.79%.

A series of emails about the over-spend were sent by the Irish Examiner to individual HSE-run hospitals. Some 10 days later, they still hadn’t been answered.

According to the Department of Health, high-level performance assurance meetings are taking place. The director general of the HSE has met the board chairs, CEOs, and clinical directors of the 10 hospital groups/hospitals with the greatest financial challenges.

Limerick TD, Fianna Fáil’s Niall Collins, says UHL’s problems stem from a failure to resource the hospital following the reconfiguration. He says that “the hospital just can’t cope with the demand”. “The emergency department is just carnage; there isn’t a day without people being left far too long on trolleys. We saw the closure of acute services at Nenagh and Clare, but there wasn’t a commensurate increase in budgets at Limerick when all those cases transferred,” he said.

Sources at UHL agree that reconfiguration funding just tapered off, but what galls them more is that for political reasons, money is being spent on smaller hospitals such as Nenagh “which are doing bugger all compared to us”. They also say UHL suffered hugely when it was lumped in with the HSE West following the break-up of the health boards: Galway hospitals took the lion’s share of the HSE West budget, while Limerick suffered as the poor relation.

In Cork, the South Infirmary, which has a 16% overrun, is blaming its financial woes on the Department of Health’s decision to reduce private patient charges.

“The variance between budget and spend is as a result of a loss in private income, primarily due to the introduction of new legislation this year that reduced private patient charges,” said CEO Gerard O’Callaghan. “There are discussions with the HSE regarding this issue.” The hospital didn’t have an overrun last year.

At the Mercy University Hospital in Cork, talks are ongoing with the HSE. The Mercy’s expenditure is broadly in line with last year, but it’s believed there has been a “small increase” in the number of patient services this year. It stood 18% over-budget at the end of May.

At last week’s health committee meeting, Laverne McGuinness, sitting in on behalf of the director general, confirmed that the acute hospital sector was responsible for about three-quarters of the HSE’s deficit to date.

She pointed to another problem: “Acute hospital agency costs overall have increased by €25.8m (up 56%) compared to the same period last year. However, 80.3% of that increase is in the areas of medical and support services staff and this primarily reflects the diminishing capacity to recruit doctors and price increases for agency staff,” she said.

As far as Sinn Féin’s health spokesman, Caoimhghín Ó Caoláin is concerned, the overrun figures are a stark reminder of how “we can’t cut resources any further” in a “demand-led health service”. He says the health service had been bled dry by austerity, with 5,000 fewer nurses alone working for the HSE.

“And now, they want different hospitals to carry over their over-spend, rather than get a supplementary budget? That’s making a bad situation already worse. I just hope Minister [Leo] Varadkar can see these figures as a wake-up call. We have moved beyond a point of reasonableness”.

In the Dublin East Hospital Group, the medical staff agree. “We are skinned to the bone in the South East. We can’t do anything more with our budgets. The only option left will be to close beds,” said one hospital consultant.

He says: “You will see that many of the worst-performing hospitals have always suffered from a lack of resources, so after years of cuts, they are barely surviving”.

In the words of his colleagues elsewhere, these hospitals are “treading water”.

Department of Health officials say the HSE is sending a clear message to hospital managers at the high-level meetings they have introduced: “Service safety and quality first, financial management next — and then all other priorities come behind these, including elective access for non-clinically urgent cases”.

That will play out as: More beds and operating theatres closing, staff positions remaining unfilled, and waiting lists and trolley numbers steadily rising.

DUBLIN NORTH EAST HOSPITAL GROUP:

Beaumont Hospital

Budget to date: €97,584,000

Overrun: €5,486,000 (5.62%)

Our Lady of Lourdes Hospital, Drogheda

Budget: €52,050,000

Overrun: €2,959,000 (5.69%)

Connolly Hospital, Blanchardstown

Budget: €34,856,000

Overrun: €1,378,000 (3.95%)

Cavan Monaghan General Hospital

Budget: €29,887,000

Overrun: €2,353,000 (7.87%)

Louth County Hospital

Budget: €7,237,000

Overrun: €780,000 (10.78%)

Monaghan General Hospital

Budget: €2,984,000

Overrun: €258,000 (8.66%)

Rotunda Hospital

Budget: €18,132,000

Overrun: €837,000 (4.62%)

DUBLIN MIDLANDS HOSPITAL GROUP:

St James’s Hospital

Budget: €124,064,000

Overrun: €2,638,000 (2.13%)

St Luke’s Hospital

Budget: €16,849,000

Overrun: €77,000 (0.45%)

Adelaide & Meath Hospital, Tallaght (acute only)

Budget: €63,942,000

Overrun: €3,772,000 (5.9%)

Midland Regional, Tullamore

Budget: €33,712,000

Overrun: €1,609,000 (4.77%)

Naas General

Budget: €21,770,000

Overrun: €804,000 (3.69%)

Midland Regional Hospital Portlaoise

Budget: €18,644,000

Overrun: €2,408,000 (12.91%)

Coombe Women and Infants University Hospital

Budget: €19,270,000

Overrun: €654,000 (3.4%)

DUBLIN EAST HOSPITAL GROUP:

Mater Misericordiae University Hospital

Budget: €89,704,000

Overrun: €4,519,000 (5.04%)

St Vincent’s University Hospital

Budget: €80,158,000

Overrun: €6,272,000 (7.82%)

Midland Regional Hospital, Mullingar

Budget: €23,594,000

Overrun: €918,000 (3.89%)

St Lukes, Kilkenny

Budget: €20,630,000

Overrun: €1,774,000 (8.6%)

Wexford General Hospital

Budget: €19,173,000

Overrun: €1,786,000 (9.31%)

National Maternity, Holles Street

Budget: €18,311,000

Overrun: €507,000 (2.77%)

Our Lady’s Hospital, Navan

Budget: €15,242,000

Overrun: €2,568,000 (16.85%)

St Columcilles Hospital, Loughlinstown

Budget: €15,233,000

Underspend: €918,000 (-6.03%)

St Michael’s Dún Laoghaire

Budget: €9,893,000

Overrun: €228,000 (2.31%)

Cappagh National Orthopaedic

Budget: €9,787,000

Overrun: €821,000 (8.38%)

Royal Victoria Eye and Ear Hospital, Dublin

Budget: €8,613,000

Overrun: €1,167,000 (13.55%)

SOUTH-SOUTH WEST HOSPITAL GROUP:

Cork University Hospital

Budget: €105,528,000

Overrun: €4,714,000 (4.47%)

Waterford Regional Hospital

Budget: €54,866,000

Overrun: €6,402,000 (11.67%)

Kerry General Hospital

Budget: €28,679,000

Overrun: €719,000 (2.51%)

Mercy University Hospital

Budget: €23,276,000

Overrun: €4,157,000 (17.86%)

South Tipperary General Hospital

Budget: €18,099,000

Overrun: €3,231,000 (17.85%)

South Infirmary Victoria Hospital

Budget: €16,618,000

Overrun: €2,719,000 (16.36%)

Bantry General Hospital

Budget: €6,795,000

Overrun: €118,000 (1.73%)

Mallow General Hospital

Budget:€6,904,000

Overrun: €404,000 (5.86%)

Kilcreene Orthopaedic Hospital

Budget: €2,157,000

Overrun: €601,000 (27.84%)

WEST-NORTH EAST HOSPITAL GROUP:

Galway University Hospital

Budget: €108,920,000

Overrun: €4,731,000 (4.34%)

Sligo General Hospital

Budget: €40,132,000

Overrun: €4,971,000 (12.39%)

Letterkenny General Hospital

Budget: €43,800,000

Overrun: €1,038,000 (2.47%)

Mayo General Hospital

Budget: €31,786,000

Overrun: €3,109,000 (9.78%)

Portiuncula General and Maternity

Budget: €18,224,000

Overrun: €3,884,000 (21.31%)

Roscommon County Hospital

Budget: €7,152,000

Overrun: €342,000 (4.78%)

LIMERICKHOSPITAL GROUP:

University Hospital Limerick

Budget: €62,409,000

Overrun: €11,221,000 (17.98%)

Ennis General Hospital

Budget: €7,151,000

Underspend: €297,000 (-4.16%)

Nenagh General Hospital

Budget: €6,792,000

Underspend: €289,000 (-4,25%)

St John’s Hospital Limerick

Budget: €6,998,000

Overrun: €1,045,000 (14.93%)

University Maternity Hospital, Limerick

Budget €7,612,000

Overrun: €494,000 (6.5%)

Croom Hospital

Budget: €5,390,000

Underspend: €444,000 (-8.24%)

Mid Western Regional Acute

Budget: €1,260,000

Underspend: €280,000 (-22.22%)

NATIONAL CHILDREN’S HOSPITAL GROUP:

Temple St Children’s University Hospital

Budget: €32,478,000

Overrun: €3,371,000 (10.38%)

Our Lady’s Hospital for Sick Children, Crumlin

Budget: €47,216,000

Overrun: €1,499,000 (3.17%)

Adelaide and Meath Hospital

Budget: €6,500,000

Overrun: 0%

TOTAL HOSPITAL GROUP:

Budget: €1.558bn

Overrun €101m (6.49%)


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