AS pressure on the embattled Health Minister James Reilly intensifies this week-end, the Sunday Independent has learnt of a government plan to fast-track a radical shake-up of the hospital system. This plan focuses on the way hospitals are funded, and the length of time a patient stays in hospital.
The move, which is part of Dr Reilly's plan to reform the health system, may shore up his position following the fallout from the Budget – and allay anxiety within Fine Gael and Labour that the fiscal difficulties of the Department of Health could seriously impact on the December bailout exit and next year's council and European elections.
The fast-tracking of the plan was recommended by an international expert, and will be phased in to 38 hospitals around the country next year. It is seen as the way to dismantle the overly centralised control of the HSE.
Its central tenet is that, instead of giving a hospital a block grant, the funding will be based on the number of patients the hospital treats and the services it provides.
The first indications are also emerging that Dr Reilly may be losing the confidence of his chief political patron, the Taoiseach. One Fine Gael minister told the Sunday Independent: "Reilly's difficulties could blow our entire local election campaign to smithereens next year if we spend our time defending community hospitals being closed and old folks losing their home helps."
He added: "Reilly's day of reckoning is here – Fianna Fail sense they can reap a great deal of political capital over this." Another senior Fine Gael source told the Sunday Independent: "The boss is becoming very uneasy about Reilly, he is starting to fret about the need for James to get control of things, that he's spending too much time in the Dail and not enough in the department."
Another Fine Gael minister claimed: "Enda's people are starting to brief against Reilly. It's all very subtle but it's real, he's in such a bad space people are beginning to feel sorry for him."
One senior Fine Gael source said: "Simon Coveney's people are already talking Leo up as the replacement for Reilly, [but] every time the prospect is mentioned Varadkar goes pale."
In an intriguing development, Mr Varadkar has displayed far more public enthusiasm for the position of a directly elected lord mayor of Dublin.
One source told the Sunday Independent: "That stuff about Reilly's special relationship with Kenny is a fairytale. He got lucky and was the only top Dublin figure to back Enda in the leadership race, Kenny will drop him as quickly as Kenny needs to, Leo [Varadkar] is already being groomed as the heir apparent and he's not too happy about it."
And there is a growing realisation that a failure to make progress in health will also hit Labour's election prospects.
"It might be a Fine Gael minister, but health is a Labour issue," a senior government source said.
"Reilly might be the minister, but they will be screaming at the Labour candidate over ward closures."
Another Labour source close to the Cabinet said: "Any gloating in Labour about Reilly is foolish, this is a Coalition problem."
Though, Mr Howlin was publicly supportive of the Health Minister last week, Dr Reilly's relations with the secretary general of the Department of Public Expenditure, Robert Watt are believed to have deteriorated further.
They said: ''Watt is determined to keep control of this, he is not going to allow Reilly to set any precedents where the Troika are scarcely out the door and we're looking for a billion here and a billion there."
The embattled minister did receive strong support from the Fine Gail chairperson on Health, Jerry Buttimer, who told the Sunday Independent: "We are all guilty of crying wolf on occasions, but when it comes to Health, the wolf really is inside the door now."
Meanwhile, the new funding scheme is expected to make substantial savings and place the HSE bureaucracy under the microscope, as well as cutting waiting lists and hospital-stay times.
"At the moment, the HSE is purchasing services from itself. There's a conflict of interest. You're answerable to yourself. There's no accountability in the system. No one is accountable to anyone else. This is how the HSE will be dismantled," a source involved in drawing up the policy said.
"If you can't tell where money is spent, how can you tell whether you are getting value? It's not about closing small hospitals, it's actually about getting them doing more by shifting procedures from big to small hospitals.
"You turn it around. You say to the hospitals that we'll pay for each patient you treat. The more patients you treat, the more money you get – and vice versa," the source said.
- FIONNAN SHEAHAN and JOHN DRENNAN