Health

Wednesday 27 August 2014

Hospitals managers warned they won't be getting any budget bailout

Health Minister Dr James Reilly. Photo: Collins
Health Minister Dr James Reilly. Photo: Collins

HSE bosses have told hospital managers they won't be getting any budget bailout this year, and they have to keep spending under control.

A confidential government report shows the health service heading for a €530m overrun this year, with many hospitals running over budget already.

The HSE document suggests overspends this year at all the major hospitals in Dublin, with St James's Hospital the highest at €24.3m. The other overspends outlined in the capital are:

* Mater Hospital: €7m.

* Crumlin Children's Hospital: €6.8m.

* Beaumont Hospital: €4.3m.

* Tallaght Hospital: €3.2m.

The positions in the hospitals around the rest of the country are not specified, but overruns are predicted in every area:

* Northern Health Area: €22.3m.

* Midland Health Area: €22m.

* Western Health Area: €20.3m.

The overspend is being caused by a spillover of payments from last year, hospital admissions being up and demographic pressures.

But the health budget is also bloated due to the well-publicised problems with savings from medical card probity, and implementing the Haddington Road agreement.

The HSE report, obtained by the Irish Independent, predicts "a full-year 2014 potential cash shortfall of €532m".

Department of Health and HSE sources say the startling projection is on the basis of nothing happening to address the overrun and there is action being taken to fix the budget.

"It won't be that, but we have a job to do," a source said.

BILLS

The figures are based on spending in the first few months of the year, which is always higher due to bills hanging over.

These sources say the shortfall will ultimately be in the region of €150-€200m.

But the HSE has written to hospital management informing them they must manage spending within their budget allocation and there will be no bailout.

"It's quite clear. Their cash target for the year is the same," a source said.

The letter, from HSE chief financial officer Tom Byrne to hospital managers, was sent in the past week. The latest black hole in health is now threatening the Coalition's ability to deliver tax cuts in next year's Budget.

Tensions are mounting within the Government over Health Minister James Reilly's failure once again to get spending under control and achieve savings under the Haddington Road agreement.

Mr Byrne told the Irish Independent the €530m figure was simply based on the level of cash spent in the first two months, known as the "burn rate", which would not reflect the year as a whole.

"I don't believe it reflects the position the HSE will be in at the end of the year," he said.

Mr Byrne also said there would be measures taken to contain spending throughout the rest of the year.

Irish Independent

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