Press Release

Minister Reilly pledges service protection a key priority as savings are made

The Minister for Health Dr James Reilly TD has today pledged that the maintenance of health services will be the key priority for 2013 despite the need for significant savings in the area. At a press conference with Ministers of State Alex White T.D. and Kathleen Lynch T.D, Minister Reilly made clear that front line services would be protected to the greatest extent possible with the needs of patients being central to any decisions made.

Funding for the area of health was today put at €13.626 billion in current funding and €397million in capital funding for the Health Service in the year 2013. This represents an increase of €150m (€60m additional funding and €90m to cover a decrease in income) for the Health Group of Estimates over and above the original expenditure targets, set out in the Comprehensive Expenditure Review published last December.

However despite the extra funding provided, just over three quarters of a billion Euro in savings will have to be made next year representing a major challenge for the services. In the region of half a billion Euro of those savings will be achievable through cost efficiencies and separately through reorganisation under public service agreement. The clear majority of the savings will therefore have no recourse to front line activity but the ministers acknowledged that it is a very challenging Estimate and required taking a number of tough measures to ensure that the most vulnerable are protected.

“The lesson over the last year is that by reforming our health services we have managed to do more with less resources. For example, despite the departure of thousands of staff and a significant reduction in funding, inpatient waiting lists have been reduced, and the number of people on trolleys in ED has been cut by almost 25%” said Dr Reilly. “Next year will pose great difficulties but that same drive for efficiencies and a better way of doing business will provide the way of overcoming those challenges” he said. “The drive to implement our programme of reform will be crucial in meeting the difficulties ahead”.

Even with the significant reduction in the cost base over the last few years, further significant cost extraction is required in 2013 and 2014, with €781m in savings to be achieved in 2013.   However, Dr. Reilly stated ”the primary aim is to cut the cost of services and not the services themselves.  This will be achieved through efficiencies and re-organisation under public service agreement, curtailing the growing cost of pharmaceuticals and increasing income generation”.

The Savings will be made up of:

  • Reduction in the cost of Primary Care Schemes (€323m);
  • Pay related savings (€308m);
  • Increased generation of private income in public hospitals (€65m);
  • Net savings on Department’s Vote (€60m);
  • Savings on procurement (€20m);
  • Other savings (€5m).

The Minister announced that due to the current financial climate, it has been deemed necessary to increase the prescription charge from 50c to €1.50, It is essential that we control the value and cost of medicines as the international evidence shows that our costs are out of line with other comparable countries.

It has also been decided to reduce the income limits for persons over the age of 70 for medical card entitlement.  While tough decisions have had to be made in this regard, under the new arrangements 92% of over 70s will have medical cards, 5% will qualify for GP visit cards and the wealthiest 3% of people will have neither card (the same percentage as at the moment)

Given the pressure on the State finances, it is also necessary to take further measures to reduce costs in 2012.  The monthly threshold for the Drugs Payments Scheme is being increased from €132 per month to €144 per month with effect from 1st January 2013.  This Scheme ensures that individuals or families do not have to pay more than the monthly threshold on approved prescribed drugs, medicines and certain appliances. The estimated saving to the Exchequer of this measure is €10m.

Significant savings have been targeted in relation to the cost of prescribed drugs and medicines, and Dr. Reilly welcomed the new agreement with the Irish Pharmaceutical Healthcare Association (IPHA) which will provide savings in excess of €400m over the next three years.  This will mean significant reductions for patients in the cost of drugs, as well as a reduction in the drugs bill to the State.

Dr. Reilly said “My Department and the HSE will continue to work on the Health Reform Programme, which is a central element of the Programme for Government and critical to providing a health service which is fair to patients, gives them access when they need it and delivers value for money for the taxpayer”.

As set out in Future Health: A Strategic Framework  for Reform of the Health Service 2012 – 2015 – we are “committed to developing a universal, single-tier health service, which guarantees access to medical care based on need, not income’ and that continues to be our aim. Today, we have delivered two important Programme for Government measures with the allocation of a further €35m for new mental health services and the €15m necessary to provide free GP care for people with certain prescribed illnesses.

Dr Reilly also stressed the importance of stringent financial control in meeting the challenges of the year ahead and the importance of new thinking in securing the best outcomes for patients and those working in the service alike.  Among the other initiatives highlighted by the Minister is an improved structure of financial control being implemented both in the HSE and in the Department of Health. Agreement in principle has also been reached in the setting up a new Nurse Graduate Programme. Qualified nurses will be offered the opportunity to apply to take part in a placement programme in the health services for a specific period. The new scheme will be of great benefit in providing experience to nurses while also being of real value to the care of patients.