Hospitals are warning that new spending restrictions introduced by the Health Service Executive (HSE) in recent weeks will impact on patient care and force some to choose between paying staff, suppliers or the Revenue Commissioners.
The Irish Times understands that a number of large voluntary hospitals are concerned at the impact of expenditure limits put forward by the HSE at the end of October and which are intended to apply until the end of the year.
It is understood that the Mater, St James’s and Tallaght in Dublin are among the hospitals facing potential difficulties in dealing with the new spending limits.
Voluntary hospitals are run by independent boards, although they receive the vast bulk of the funding from the HSE.
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The representative body for voluntary hospitals said that, on October 31st, the HSE had advised the chairs and chief executives of the various institutions that new cash limits would be imposed until the end of 2024.
It said that these sought to cap the amount each voluntary hospital could spend in the final two months.
The Irish Voluntary Healthcare Association (IVHA) said each individual hospital had been asked to confirm if they could operate within the limits.
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It said the “majority of large voluntary hospitals are unlikely to be able to do so”.
The IVHA said: “The imposition of these cash limits 10 months into the year, with insufficient notice, presents real and practical challenges to hospital managements. If fully imposed, there will be an impact on patient care and certain hospitals will be forced to choose between paying staff, suppliers or the Revenue Commissioners.
“The non-pay limits are based on 2023 budgets. They take no account of the increase in demand for healthcare services, which is 8 per cent for level-four hospitals (large institutions which have a 24-hour emergency department and provide care in a number of specialities) in 2024. Similarly, these cash limits do not account for increased costs, which in places have been imposed by the HSE, for example where increases in the costs of medicines have been agreed.”
The HSE has not publicly commented on the nature of the new cash limits.
It said hospitals were given increased cash limits in July and August after the Government agreed to provide an additional €1.7 billion in funding to the health service over 2024 and 2025. Overall, the health service will receive record funding of €24.3 billion this year.
The HSE said, however, that hospitals were also required to deliver savings and increased productivity as part of this funding agreement.
The Irish Times reported last week that the HSE board warned management at the end of September that additional spending controls would have to be introduced if measures aimed at tackling overspending in non-pay areas – such as on goods and services – were not successful.
The HSE said: “The final cash-based supplementary approved by the Oireachtas for Department of Health- funded services was €1,749 million. This represents an increase of €47 million on the additional €1,702 million funding for 2024 set out in the two-year agreement announced in July. The agreement also details productivity and savings that the HSE needs to deliver, and these are to be delivered by all HSE-funded services, with a portion therefore coming from acute voluntary hospitals.”
“The hospitals were given increased cash limits in July/August arising from the two-year agreement with Government on funding. They were also required to deliver productivity and savings, as part of the overall requirement on the HSE in this regard. Engagement with the voluntaries and with all HSE services is ongoing as we work to ensure we remain within our overall cash limit for 2024.”
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