Another fine medical card mess: James Reilly caves on cull
Taoiseach sends in his troubleshooters as €113m cuts target is abandoned
HEALTH Minister James Reilly has been forced to dramatically scale back his planned cull of medical cards – leaving another funding black hole of more than €40m, the Sunday Independent can reveal.
The abandonment of the original €113m target for the controversial medical card probity comes as the furore over top-ups in the health sector continues to rage.
The board of the Central Remedial Clinic is under mounting pressure to resign in the wake of damning revelations of management salary top ups being paid for out of fundraising.
The deepening 'top-up' scandal involving payments to senior health managers is distracting from the ongoing cuts to frontline services, which are affecting patients.
Senior government sources admit the health sector will need a bailout of "no less than €200m" by the end of the year.
The disarray in the health service has prompted Taoiseach Enda Kenny to order his officials to take an ever increasing role in the operation of Dr Reilly's department and the Health Service Executive (HSE).
Aside from supervising the spending side, the Taoiseach's office now has a designated spin doctor working with Health and the HSE on communications.
As well as setting out where €666m of cuts will be found in 2014, the HSE service plan will also contain details on the dismantling of the HSE and the long-term reform of the health service.
Talks on the HSE service plan are continuing with the negotiations now focused on the review of medical cards.
The implementation of the Haddington Road Agreement is another cause of friction.
A new target for medical card probity will be set out, with estimates ranging from €55m to €70m – well down from the original €113m.
The real figure of what is actually achievable may be even lower, with a senior source suggesting it will be "less than half".
The €113m estimate was hugely controversial as it appeared to have been created at the last minute and imposed on Health and the HSE in the run-up to Budget 2014. The failure to reach the pre-set targets for savings from medical cards and pay means savings have to be found elsewhere.
Government officials had hoped to get the sign-off by Cabinet on the HSE service plan this week. But Enda Kenny's departure to Japan for a week has put off this deadline.
Following talks last week between the Department of Health and the Department of Public Expenditure and Reform (DPER), government sources admitted the €113m target from the cuts to medical cards will not be achieved.
"The verification process is saying some of the stuff is not achievable. If that's the case, then you have to find it elsewhere.
"There is a general consensus across Government that this probity exercise is not going to do it. You would have to take out medical cards from January 1. When you step back, you find the number of people entitled to the card is high," a senior government source told the Sunday Independent.
But the review of medical cards won't just be a once-off and there are plans to repeat it every year.
Another source said: "When you apply for a tax credit, you have to do it every year. Why not be asked to certify you are still entitled to a medical card? It should never have been allowed to happen. Why shouldn't we always be checking the circumstances? Why not constantly do it?"
DPER and Health are also at odds over the payroll savings from the Haddington Road Agreement.
"Just get on with it and do it. If a signal is being given out to the system that it can't be achieved, then managers and staff don't do it.
"You have to try. We are still sticking to the target," a senior Government source said.
But Health and the HSE are arguing the "local circumstances" do not allow for the implementation of flat cuts in staffing and they want lower targets to be set.
"The average rules don't apply. It's very different. You have 2,600 organisations with a service level agreement. We don't want to set up people for failure. The system is actually responding so what you don't want to do is torpedo that," a Health source said.
Within the Taoiseach's department and DPER, there are also serious concerns about the management within Health and the HSE.
The Government has already put in a committee to oversee spending and verify estimates in the Department of Health, made up of the secretaries general of Health, Taoiseach and DPER, Ambrose McLoughlin, Martin Fraser and Robert Watt.
This so-called 'Three Wise Men' structure is expected to continue in some format even beyond the current budgeting process.
The Taoiseach has also been taking a more assertive role in cabinet sub-committee on health meetings and directing more oversight of Health.
Fine Gael and Labour Party ministers are annoyed at Dr Reilly's failure to get any credit for any of the gains in the health service, such as the reduction in hospital waiting lists and waiting time on trolleys in the A&E system.
The Taoiseach's office was already influential in simplifying the communication with the public on the review of the medical cards.
"The department is fire-fighting all the time. It's about trying to put a bit of shape on the overall plan for the minister. You should be constantly campaigning. There's achievements getting done that are not getting out," a government source said.
The HSE service plan also contains details on the HSE's own abolition, through the setting up the new hospital groups, the transition to the 'Money Follows The Patient' system and the setting up of a Systems Reform Office.
"Health is in a situation where it is being asked to deal with the underlying deficit, demographics and take money out," a source said.