Reilly seeks major cuts in spending on sick leave

MINISTER FOR Health James Reilly has told health managers he wants a “major concentration” on cutting costs for sick leave, overtime and agency workers to curb overspending in the health service.

Dr Reilly plans to deploy a new set of financial controllers at national and regional levels in the HSE with a brief to make savings in the €750 million spent annually in these three areas, as well as stemming overruns in spending on medical cards.

A senior financial control post will also be created in the Department of Health, a spokesman for the minister said yesterday.

Latest figures from the HSE show its underlying deficit rose to €253 million at the end of July. The figures were superficially improved by the early receipt of €130 million in funds from the UK but these will not count in the longer term.

In June, hospitals were overspending to the tune of €151 million, largely because they are busier than envisaged. The deficit in the medical card scheme was more than €92 million in the red due to increased activity and the non-delivery of savings on drug costs which were expected, according to the HSE.

By the end of the year, the HSE’s deficit is projected to top €500 million unless corrective action is taken. However, the HSE and the minister have differed on the way to cut costs, with Dr Reilly rejecting managers’ proposals to cut services and insisting instead that savings can be made by cutting cost on sick leave, overtime and agency workers.

His spokesman said managers were being moved to a “cash-limited” regime in these areas to encourage them to reduce spending. The HSE would also be required to adhere to the service levels envisaged in its service plan for the year.

“It is also the case the HSE is engaged in negotiations with the staff organisations, including consultants, and is seeking maximum co-operation in terms of work practices, etc. It is wrong, therefore, to suggest there is a paucity of action to tackle the overrun.”

He said Dr Reilly rejected the claim by Fianna Fáil leader Micheál Martin that he had misled the Dáil about the spending requirement for the health service.

The minister concluded a deal with insurance companies to get €125 million in unpaid income this year, he said, and also negotiated a “breakthrough” deal with branded drugs manufacturers that resulted in savings of €10 million. This would also pave the way for negotiations, starting next week, “which will secure savings on a much greater scale”.

Legislation allowing for generic substitution, which is currently before the Seanad, would allow for significant reductions in the cost of drugs to the HSE, he added.

Dr Reilly is leaving next week on a week-long visit to China, where he will speak at a health conference in Beijing. He is visiting at the invitation of Chen Zhu, the Chinese health minister. Last September, the minister spent a week in China promoting Ireland as a healthcare destination.

Among the groups taking part in the latest trip are the Royal College of Surgeons, the Royal College of Physicians, An Bord Altranais and the Irish College of General Practitioners.