High costs and widespread inefficiencies of Irish health system highlighted in OECD report

Healthcare in Ireland suffers from widespread inefficiencies, elevated costs and fragmented governance, according to a new report.

In publishing its annual economic survey of Ireland on Wednesday, the Organisation for Economic Development and Co-operation (OECD) for the first time included a detailed assessment of the health system.

It says overall spending in Ireland on health is high, particularly in light of our relatively young population, and expensive compared to other European countries. Ireland is one of the highest spenders on health in the OECD and also has one of the highest shares of Government spending on health.

The State is facing some of the largest pressures on public spending from health and pensions over the next 40 years, the OECD warns, given our current youthful population, rapid expected ageing and relatively high long-term care costs.

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According to the OECD, Ireland’s waiting lists are shorter than in most eastern European countries, but well above the UK, Sweden and New Zealand.

Notwithstanding the centralised nature of the system, governance structures are fragmented and hamper the strategic planning of healthcare service delivery, it states.

Overall, the health of the Irish population has improved substantially during recent decades, and is quite good compared with other OECD countries, the report notes.

However, health spending is “elevated”, partly reflecting a system that is strongly based on hospitals. Population ageing is exacerbating spending pressures and the health sector is dealing with past underspending that has constrained service delivery, contributing to substantial waiting lists, and heavy pressure on staff.

Quality of care in the Irish health service is generally good, but there are widespread inefficiencies, according to the report.

Overweight including obesity affects 61 per cent of the Irish population, slightly above the OECD average. One-quarter of the population is obese.

The report says there is “significant scope” for scaling up efforts to curb the damaging consequences of alcohol consumption, and describes the level of obesity as a “growing concern”.

It suggests fines should be introduced to police rules supporting healthier diets and reduced sugar intake.

Another recommendation is the removal of tax relief for private health insurance, or making it conditional on means testing.

Drug prices should be linked to an average of the lowest prices among benchmark countries, it also suggests.

While describing the Government’s Sláintecare reforms as “complicated”, it says stepping up efforts to address legacy issues and move forward on the reforms, while using resources effectively, is now key to meeting the challenges in health.

“There is a need to balance the trade-off between efficiency and equity, while reforming Ireland’s complex health system,” it says.

However, measures resulting in increased public spending should avoid providing incentives to “freeride” subsidised public care to those who could bear a greater share of its costs.

“Conversely, if not well designed, policies shifting part of the burden of costly healthcare on to the private sector, such as through higher out-of-pocket payments, could undermine the broader objective of ensuring more vulnerable households have timely access to care on waiting list.”

Welcoming the report, Minister for Health Stephen Donnelly acknowledged Ireland has high costs in the health sector by international standards, and that it was important to deliver value for money.

“The issues Ireland’s healthcare services faces are shared by many of our OECD peers and learning from the initiatives of other countries is a major benefit of work like this. The OECD provide a broadly positive assessment of the current reform direction, which we will use to further enhance and accelerate these reforms, to deliver an efficient, effective, patient-centred health service,” he said.