Increased spending on health has not led to higher productivity in hospitals, report finds

Report found savings of €554m were to be found across the health service this year.

A new report on spending and productivity in the health sector has raised concerns increasing budgets has not resulted in more activity in hospitals.

It also found savings of €554m were to be found across the health service this year.

The health budget increased by €8bn between 2016 and 2022, but activity in hospitals increased by less than 10% in that time, the report, published on Monday by the Department of Health, shows.

The plans target savings of €500m in "non-pay savings/cost containment in acute settings".

The action plan also includes a target to reduce spending on external management consultancy firms. This would include firms such as PwC and EY Ireland. 

The Irish Examiner previously reported the HSE spent more than €458m on external consultancy firms.

The target for last year was a 30% reduction in costs, coming to €113m, with monthly reduction targets now set for this year. 

Each hospital will have to report its reduction targets to the new regional executive officers (REOs) in six new HSE regions.

The plan will also see a reduction in the cost of care at HSE long-term residential care facilities for older people, although the amounts are yet to be decided upon.

A medicines taskforce will examine saving to be gained in this area, with a target of saving €20m. This will include enhanced expenditure controls across hospitals and various schemes.

Hospitals will be asked to report to the new REOs on a range of targets also around boosting productivity.

In terms of activity, these include the number of patients, how long they stay in hospitals, how operating theatres are used, and consultant productivity, as well as the number of patients who do not show up for their appointments.

Each region will be expected to run at least one virtual ward, whereby patients can stay at home and receive support remotely. This frees up hospital beds for people in need for in-person care.

New approach to waiting lists

Waiting lists will also see a new approach, with a central referral system to be introduced for each region to speed up patients’ access to care.

The reforms will mandate the use of outsourcing to private providers for patients who have been on a list longer than 12 months without an active plan. 

This will include specialities such as dermatology, where waiting lists are extremely long.

Health Minister Stephen Donnelly said this was about matching spending with outcomes.

“Between 2016 and 2022, the health service budget increased by over €8bn. We currently rank ninth in terms of spending per capita out of the EU14 adjusting for prices,” he said.

The analysis showed, he said, staff numbers grew by 30% or the equivalent of 16,000 full-time staff in that time.

“We have 2,500 more doctors, 5,600 more nurses, and 3,700 more support and administrative staff. And yet, as this analysis shows, activity in our hospitals has increased by less than 10% over the same period,” he said.

Last year, however, he said: “We saw outpatient activity rise 6%, day cases 7% and inpatient activity rise 6%.” 

He described waiting lists as now decreasing, and said the number of people waiting longer than 10 or 12 weeks for care had “decreased substantially”.

“This is very positive, and we will work hard to deliver another reduction in waiting times in 2024,” he said.