State criticised over healthcare costs in EU report

The European Commission has strongly criticised the Government's failure to control health costs and reduce the price of medicines.

A failure to address barriers to entry to the medical labour market, unequal access to services for middle-income families and public patients, and poor outcomes are also highlighted in the health section of the commission's report on Ireland.

The Department of Health rejected the finding, saying "considerable progress" had been made in opening up the medical labour market and a series of reforms had cut the price of drugs.

Public healthcare spending in Ireland is second only to Denmark’s, even without taking into account our younger population, the commission report points out.

Public expenditure on health was 8.3 per cent in 2013, 1.1 per cent above the EU average.

“Ireland has an unusually high proportion of the population covered by private health insurance,” the report says, “thereby relieving part of the pressure on public spending”.

Care indicators

Despite the above-average spending, Ireland is frequently in the bottom third of OECD countries on a range of quality-of-care indicators,including avoidable hospital admissions, cancer survival rates and antibiotic use.

While there has been some degree of success in reducing expenditure since 2010, the commission warns that overruns are “becoming systematic and increasingly large”.

It describes the Government’s plans for universal health insurance, which have been delayed by some years, as being “in a quandary”.

Financial management and information systems remain weak and are not in a position to facilitate a planned move to hospital groups.

Unequal access remains an issue, the report says, particularly for middle-income earners who do not have medical cards and may not be able to afford private insurance.

The report highlights a “blurring of the lines” between the treatment of private and public patients in hospitals.

The commission says the Government’s plan to reduce the strain on hospitals by providing care in the community at primary care centres will prove challenging given the shortage of full-time GPs and difficulties in training and qualifications.

It says almost none of the barriers identified by the Competition Authority to enter in the medical labour market have been addressed.

Drug savings

On drug spending, the report says reforms have generated savings on the cost of off-patent medicines and that the use of generics has increased.

However, less progress has been made in improving prescribing practices.

The lack of competition in the supply of drugs is criticised.

The commission points out that 80 per cent of spending goes on medicines that have a single supplier.

Efforts to reduce costs have not been fully effective, and the authorities seem reluctant to activate their pricing powers under legislation, according to the report.

The Irish Pharmaceutical Healthcare Association criticised the commission’s findings on drug cost-effectiveness and said it was “imbalanced and unjustified” to single out the area.

It also said public spending on drugs in Ireland “has not been shown to be an outlier among EU member states”.