Press Release

Announcement by Micheal Martin TD, Minister for Health and Children following the publication of the 2003 Estimates

In the context of the Health Estimates, announced on November 14th 2002, the Minister for Health and Children, Micheál Martin TD was required to make savings of over €20 million revenue under the Drug Payments Scheme to meet expenditure provision for 2003. This is against the background of the €230 further required to meet the increased cost of the GMS as a whole, an increase of 31% on 2002.

It should be noted that this follows a 40 % increase (€56m) in the cost of the DPS since 2000.

In order to protect lower income groups the following set of measures have been decided upon:

  • An increase in the monthly DPS expenditure threshold of €5 to €70, to take effect in the New Year: this will produce savings of €7.2 million.
  • Substitution of generic drugs for proprietary drugs: substitution is possible for about 18 % of DPS prescriptions, and is likely to save €2 million in 2003;
  • Discontinuing advance stock payments to community pharmacy contractors: at the introduction of the GMS in 1972, pharmacists entering the state scheme had to settle with suppliers within 30 days but were not reimbursed by the State within that period, so they were paid an advance payment equating to one month´s ingredient cost, surrendered on termination of the contract. However, as pharmacists are now paid within 2 weeks of claiming reimbursement from the GMS (Payments) Board, there is no basis for these advances. Savings are likely to be about €5 million.
  • A detailed examination of invalid/illegible claims: community pharmacists are currently reimbursed where, for a variety of reasons, the eligibility of the patient is not properly verified. The Minister is firmly of the view that a far stricter approach must be taken to such claims from now on, and this should yield savings of €2 million.

There will also be an increase of 5% in the income for public hospitals from charges raised by these hospitals from private beds; this will give additional income of €5 million. This income goes towards supporting services in public hospitals and is part, therefore, of their budgets. Even with this increase, the cost of providing services to private patients in those hospitals is well in excess of the income from the private insurance companies. This is recognised in the White Paper on Health Insurance 1999 which set down that public hospitals would move towards a system of full economic costing over a 5-7 year period. In the interests of equity, it is Government policy to gradually eliminate the subsidy.

This is an issue of fairness for the public patient and taxpayers. It is reasonable to expect that the private health insurance companies, who have seen a significant increase in their membership, carry their fair share. The income raised from these charges represents a valuable source of finance for the public hospitals and is part of their approved budget

The Minister said “The best use of finite health resources in the current situation requires careful targeting of available funds through responsible governance. Effective management of our health system gives us the best guarantee that the Health Strategy will be delivered”.