Press Release

Tánaiste announces plan for 1,000 new public hospital beds over 5 years

Private beds in public hospitals will move to new private hospitals on public hospital campuses

The Tánaiste and Minister for Health and Children, Mary Harney, T.D., today (Thursday) announced plans to have new private hospitals built on the campuses of public hospitals that will free up 1,000 more beds for public patients.

The Tánaiste said,

“Today I wish to announce a strategic reform initiative for our health services.

“The Government has identified the need for new public beds in our hospitals. We are already investing substantial amounts in providing new beds.

“By now encouraging new private hospitals to take a substantial number of private and semi-private beds out of our public hospitals, we will create new beds for public patients in the fastest and most cost-effective way in the next five years.

“The policy brings together different elements of Government policy in a coherent and practical way with the aim of:

  • increasing bed capacity for public patients in public hospitals;
  • encouraging the participation of the private sector in generating extra capacity;
  • maximising the potential use of public hospital sites;
  • promoting efficiency among public and private acute service providers;
  • promoting greater competition in the supply of hospital services; and
  • offering improved quality and choice to all patients.

Health Service Executive

“The Board of the Health Service Executive was briefed on and discussed this policy initiative at its July meeting.

“My Department has written formally to the HSE setting out the policy and an assessment framework that should be applied for the new hospital proposals. This framework was drawn up by my Department with the assistance of Prospectus management consultants earlier this year.

“I am publishing the letter to the HSE and the assessment framework now so that every participant in this initiative will know all the ground rules from the start.

“I have indicated to the HSE that the policy is to allow up to 1,000 private beds to be moved from within the public hospital system over the next five years. This is an achievable and prudent target.”

“I expect that the HSE will begin work immediately so that as soon as possible invitations to tender for new hospital developments will be issued.

Public private mix

“The public private mix within our public hospitals has long been a feature of our health service. While it has advantages in terms of sharing clinical expertise, it has been recognised that inequities for public patients have arisen.

“This initiative today will improve access for public patients, while providing insured patients with purpose-built, new hospital facilities.

“It is also a central element of this policy – as set out already in the Finance Acts – that public patients should be able to have access to the new private facilities. This can be done through the National Treatment Purchase Fund or by direct arrangement with the Health Service Executive.

“I look forward to the private sector bringing forward proposals outlining how and at what cost they would make these facilities available for public patients.

“The public private mix has proven difficult to manage, and resource and cost sharing is not as clear as it should be. By separating out the management and financing of a substantial portion of private beds, it will bring greater clarity to issues such as these.

“It is Government policy since 1999 that the full economic cost of private beds in public hospitals should be paid by insurance companies. This initiative, which incorporates the policy of full economic charging, will achieve an increase in public beds and new hospital facilities.

“The initiative will build on the tax breaks available for private hospital investment. It is, in fact, an important rationale behind the tax concession. By locating new private hospitals adjacent to the existing public hospitals, we will achieve complementary roles for the public and private hospitals.”

Hospital organization and consultants

“This initiative is also designed to support our existing policy of building up regional self-sufficiency in our hospital services.

“Consultant-provided, team-based working arrangements are required to ensure best patient care. The introduction of such arrangements will be required under this initiative.

“This policy sets out clearly a very important aspect of the configuration of our hospitals for the future. It is a key part of the context for a new consultants’ contract.”


In conclusion, the Tánaiste said,

“This is a practical strategy aimed at achieving a fast response and a quick impact.

“It will pull together in a concerted and focused way the different strands of Government policy in relation to the Health Strategy commitments, tax breaks under the Finance Acts, private insurance and economic charging.

“It will ensure greater capacity for public patients and, at the same time, a more vibrant and innovative role for the private sector.

“It makes health policy sense and it makes economic sense.

“All patients will benefit.”