Residential and emergency care main contributors to health overspend

Cost pressures for providing residential care for people with intellectual disabilities, as well as emergency care, are some of the main reasons for health overspending, the public accounts committee will hear today.

HSE chief executive Paul Reid will also inform the PAC that compensation claims against State agencies are seeing spending pressures increase.

PAC members will quiz Mr Reid about public procurement issues, while separate questions will be put to officials about escalating costs related to the National Children’s Hospital.

Mr Reid will outline how overspending in health this year will amount to €319m. Nonetheless, he will say, that this compares to a bailout for services in 2018 that amounted to €636m.

“Pension and demand-led areas account for €200m of the variance as at September 2019,” says Mr Reid will state.

However, similar cost problems still continue to push up spending compared to previous months.

Mr Reid will tell the PAC: “The greatest cost pressures within our operational services are in respect of providing residential placements to people with an intellectual disability and the provision of specialist emergency care within the acute hospital setting, particularly in the context of an ageing population with increasingly complex needs.

“The costs within our pensions and demand-led areas are, in the main, driven by policy, legislation, demographics, and the macroeconomic environment and are not generally amenable to normal in-year financial management.

State Claims Agency reimbursements are also within this area and there is a significant and ongoing focus on mitigating, insofar as is practical, the underlying risks and issues which give rise to claims.

Mr Reid says monthly meetings with health managers to try to keep costs down are continuing.

Meanwhile, the team overseeing the construction of the children’s hospital will update the spending watchdog committee about the estimated €1.7bn costs.

Fred Barry, chairman of the National Paediatric Hospital Development Board, will reiterate that some costs, as consultants have advised, will be outside of the board’s control.

“As pointed out by PwC, some of these risks are under our control and some are not. We are actively managing those under our control while monitoring those that are not.”

TDs on the committee are also expected to seek details about the fit-out for the hospital and its facilities.