Speech by Minister for Health Leo Varadkar at MacGill Summer School Glenties 23 July 2015

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Director, Distinguished Guests, Ladies and Gentlemen

I want to begin by thanking Joe Mullholland for the invitation to return to Glenties. The MacGill Summer School serves an important function, and allows us to debate key issues and discuss new ideas in a considered way.

And we certainly need that in Health.

When the Taoiseach, John A. Costello, approached Tom O’Higgins in 1954 to become the first-ever Fine Gael Minister for Health, he gave him a firm instruction: ‘try to take health out of politics’. An instruction that I suspect has been given by Taoisigh to Ministers many times since.

O’Higgins knew the scale of the challenge – he had seen how the Mother and Child controversy had damaged the previous coalition, the first Inter Party government. He also bore witness to the power of vested interests from professional groups, to religious and other bodies that cloaked themselves in the language of morality and tradition, and frustrated even the most tepid patient-centred reforms.

So, he approached the job with skill and sensitivity. Among his notable achievements were the extension of new hospital and specialist services to 75% of the population, bringing into operation the mother and child maternity service, and actually building and opening long-promised new hospitals like Connolly Hospital in Blanchardstown and University of Limerick Hospital – as we call them today.

Perhaps his greatest achievement was the introduction of legislation to establish the VHI, and he advanced money to the Board to get it off the ground. Whilst acknowledging the contribution of VHI and its initial success, its establishment did sow the seeds of what became our own uniquely unusual two-tier system, and all the perversities and unfairness that comes with it. This is something I will speak more about later.

When I became Minister for Health last summer I took it upon myself to try and follow in O’Higgins’s footsteps, and – once again – take some of the political heat out of health, and create some space for reasoned appraisal of the strengths and weaknesses of our health service.

I prioritised getting important practical reforms and projects over the line, like GP care without fees for the oldest and youngest in our society on a universal basis, with no means test or sickness tests – the first concrete step to universal health care.

I pressed ahead with important and overdue infrastructure projects like the new National Children’s Hospital. Planning permission for the Children’s Hospital will be lodged within weeks.

And I sought to map out a vision for the future – not grandiose, maybe not even ideal, but just maybe a vision that is politically deliverable, affordable – better and visibly so.

What few recognise is that I haven’t devoted all of my energies to fire-fighting and defensive actions. And by doing so I have gained some time and space to get some important things done. A Health Minister who is always on the defensive makes an easy target for others, but is never going to be able to get things done for patients or taxpayers.

In the past year I have rolled up my sleeves and sought to ameliorate patient safety issues, hospital overcrowding, and excessive waiting times for public patients, whether by opening more community and acute hospital beds, securing more funding for the Fair Deal nursing home support scheme, promoting system change, or by setting maximum permissible waiting times and resourcing and enforcing them. I have acknowledged the many shortcomings and failings in our health service. But I have also defended our health service and our staff when they come under relentless and unfair attack, or are subjected to unbalanced criticism.

We face many challenges in the health service, particularly in terms of equity and access. But lots of things in our health service are going well or are getting better, thanks in part to the National Clinical Programmes.

That includes:

· improving life expectancy,

· cheaper medicines,

· improving cancer survival,

· reduced deaths and disability from stroke,

· fewer heart attacks and almost nationwide access to primary Percutaneous Coronary Intervention,

· an air ambulance to take people in remote areas such as this to specialist centres in time,

· getting advanced paramedics to the scene of serious emergencies,

· providing care long before the patient gets to hospital,

· the lowest MRSA infection rates reported in many years,

· practical North-South co-operation in areas like cardiology and radiotherapy that will be of great benefit to this county in particular,

· and coming from behind to provide world-leading programmes, from bilateral cochlear implants to the treatment of Hepatitis C.

We continue to have lower maternal and peri-natal mortality rates than in the United Kingdom or United States and we have more midwives and consultants than ever before against a backdrop of falling birth rates, notwithstanding the criticism of our maternity services and all the work that still needs to be done in that field.

We have lower surgical complication rates than the NHS, and you are statistically much less likely to die of a stroke or heart attack in an Irish hospital than a British one. And though we struggle to recruit and retain staff, the number of doctors registered with the Medical Council at 19,000 is now at a ten year high, the number of consultants and NCHDs employed in the public health service is at an all-time high, and we have 500 more nurses on staff today than this day last year.

Anyone who follows the public debates and discourse on health would be forgiven for thinking it otherwise. But those of us who know the health service, have worked in it and care about it, know that we have many things to be proud of, much to protect, and most importantly, much to build on.

When our chair this evening, Ruth Barrington, published her seminal study of health, medicine and politics in Ireland, 1900 to 1970, almost 30 years ago she began the book with a question: ‘How did we come to have one of the best health services in the world?’

I suspect that if the book were revised for publication in 2015 she might rewrite that opening, and pose a different question about what has changed in the meantime. To understand the problems that developed in the health service we can be guided by two key studies by my colleague on the panel Maev Ann Wren, because they expose the political, economic and cultural forces that were at play in recent decades, as well as setting out some useful ideas about reform.

I am particularly aware of what went wrong in 2004 with the creation of the HSE. I recall it well. I was a Senior House Officer in St James at the time and a young county councillor in my spare time. As Maev Ann wrote in ‘How Ireland Cares’: ‘the legislation providing for the establishment of the HSE, the Health Act 2004, passed all stages in the Dáil in a guillotined debate in November and December 2004, without time for many provisions to be discussed and fully understood within or outside of the Dáil, even by the Government’. ‘Even by the Government’ – that is an incredible indictment.

Writing in 2006, Maev Ann and her co-author, Dale Tussing, wrote that ‘There was no White Paper outlining intent of the legislation. The policy-operations divide between Minister and CEO leaves great scope for confusion and blame. The legislation is deficient in accountability’.

Some of the progress we have made in health since 2011 has been slow, but some of the caution has been justified because reforms should not be rushed. That was the cause of so many of the problems back in 2004, and I am determined not to repeat them.

We have had so much upheaval in health. There have been three major sets of structural reforms in ten years. There is great instability in the system at the moment. Many key posts are vacant, filled with newly-appointed staff who barely have their feet under the table, or by ‘interims’ or people ‘acting up’, or people in newly-created roles.

In my mind, the health service is a little like a ship damaged at sea. Ideally, you’d sail it into harbour, take it out of service for a while, put into dry dock and carry out a full repair. But you can’t. The ship is still at sea, has to keep sailing and therefore needs to be repaired at sea. So we need to make changes slowly, resource them well, project manage them carefully, and bring as many people with us as we can.

We all want changes that will bring about a universal health service with timely access to safe and quality health care for everyone.

July the 1st of this year marked the first step tangible in step in realising that vision with the extension of GP services without fees to 270,000 children under the age of six, and an enhanced and better-funded service for 150,000 children under six who already have a medical or doctor visit card.

The second step comes next month with the inclusion of another 36,000 people aged 70 or older. It has been described as the biggest move towards universal access since the Mother and Child Scheme in the 1950s, but we shouldn’t forget that many other countries did this more than half a century ago.

When considering vision and policy for the future, I believe we should always start with Healthy Ireland, the Government-led programme to improve our personal and public health. It’s the best way to ensure that we all live longer and healthier lives, and it’s the best way to tackle rising health costs in the long term.

We’ve made great progress on smoking and now we need a similar focus on alcohol misuse, obesity and physical inactivity. I look forward to piloting our first ever public health legislation on alcohol through the Dáil and Seanad, and publishing new action plans on obesity, physical activity and public health this year.

The next important step is building up primary and social care in the community. The Government has already expressed its desire to extend GP care without fees to all children in a second term, if we are re-elected. I think that can be done. And I can see no reason why we should not do so within the first years of the new Government, perhaps extending it first to all primary school children and then to all secondary school children.

We are already showing form on chronic disease, with better asthma care written into the new under six contract, and a new diabetes contract for GPs starting later this year, alongside better access to ultrasound and a GP minor surgery pilot.

I’m looking forward to concluding discussions with the IMO on further extending the scope of – and access to – general practice ahead of the March 2016 deadline if possible. However, I would not like GPs to become de facto public servants, entirely dependent on the State for their income. Their autonomy is one of the things that makes General Practice work.

I would like to find a different way to cover adults – who are not already covered – for free access to primary care. I believe there are two options. The first is social insurance, using a reformed PRSI/USC system to refund medical expenses such as GP visits and visits to the pharmacy, dentists and therapists. With rising employment, falling unemployment and rising wages, I think it is affordable. It could also be a major step towards a single-payer social insurance based system with payments to providers, or refunds to patients, administered by a new single payer.

Another way of achieving the same outcome would be to introduce universal health insurance for primary care first, using a multi-payer system, and giving people the option to pay for it through Social Insurance – their PRSI – or to opt out in favour of a new or existing private health insurance policy that offers the same or better.  I think it could be done within the term of the new government. In fact, I am sure of it.

Of course, we should never make the mistake of thinking that primary care is just about GPs and dentists. Therapists, nurses, community midwives and psychologists play an increasingly important role.

Community Pharmacists are enthusiastic to do more, to manage patients as well as dispense prescriptions, and we should help them to do more – to manage minor ailments, administer more vaccines, and do more medicine management and monitoring.

We also need a new scheme to reduce the out-of-pocket cost of medicines. €140 per month is just too much and falls very heavily on single-person households. The €2.50 prescription fee is also too high. Some of the savings we make from any agreement with the pharmaceutical industry should be used to reduce these fees or introduce lower monthly or annual caps.

We also need to continue building primary care centres. There are now almost 90 primary care centres up and running, with a new one being opened every month. This is impressive but it needs to be sustained.

We remain inadequately resourced for home help and home care packages in many parts of the country. These are crucial for keeping people well, functioning and in their own home.

I don’t think we will ever resolve the problems in our hospitals without focusing on all of these. Taken together, this is an expensive package, but it should be possible over the next five years if we prioritise it.

So what about the hospitals? When it comes to funding hospitals, you have to ask three questions in my view:

· Is it enough?

· Is it spent well?

· And how is it collected?

An underfunded service will be a poor service, no matter how it is organised. With the current staffing levels of specialist doctors, midwives and nurses, critical care beds and other capacity, no system of universal healthcare will be able to deal with unmet demand.

In other words, no matter how much you tinker with the current system, unless you have the necessary resources in place you won’t get rid of long waiting times or overcrowding. An under resourced universal healthcare system which puts everyone on a lengthy waiting list – albeit everyone waiting for the same length of time – won’t have much appeal.

At the same time, no matter how you much money you have, it will never be enough if you don’t spend it well and spend it efficiently. That’s why we need to develop autonomous hospital groups and community healthcare organisations, and place them on a statutory footing as providers of hospital care. These have been established on an administrative basis.

It’s certainly not the case that all hospital groups have to be the same, and one size does not need to fit all. Voluntary hospitals may come together to lead their hospital groups. In others, new governance arrangements will be required at group level. In some they exist already. It is my strong view, however, that the current administrative set-up needs to be replaced with a clear statutory one, and that this should be done within the first two years of the next Government.

I am also strongly of the view that hospital groups should be truly autonomous to the extent that any body which is funded mainly by public money can be. That means having board members that are not all appointed by the Minister. The Hospital Groups, or Trusts if you prefer, must also have the authority and freedom to negotiate independent contracts to recruit managers and specialists outside of the constraints of public sector rules in the way semi-State companies do now, and to recruit their own general staff and enter into the contracts independently as semi-States do now.  They should own their own assets and be able to borrow against them.

Along with greater authority will come accountability, including for meeting healthcare standards as assessed by HIQA, and for delivering value in the use of public money as audited by the C&AG and subjected to scrutiny by the PAC.

The move to Activity Based Funding is a critical reform. It is more advanced than people may think but will require a long transition period given the huge variation in efficiency versus funding from one hospital to another. We need a major investment in modern, IT-based financial systems so that we can actually follow the money. And we also need electronic patient records, so that we can follow the patient. At present, we really can’t do either very well.

Activity-based funding will replace block-grant budgets and will ensure that money follows the patient, and therefore that hospitals and community healthcare organisations are incentivised and paid more to do more work, whether that involves more hip operations, more home help hours or more dermatology clinics. I believe linking spending to activity is the biggest single reform that will make the most difference for the better in our health service, from the point of view of patients and taxpayers.  I believe it can be done during the term of office of the next Government.

At the top, we need a Health Commission to assess demand, allocate funding, and set models of care. This would split the health purchaser from health and social care providers, and allow the Health Commissioners to get the best value from health providers whether they are public, voluntary, charities, NGOs or private companies.

The Health Commission could be based upon a re-shaping of existing responsibilities and expertise in the HSE and the NTPF, but also with input from new people who bring additional skills. A Health Pricing Office separate from providers and purchasers will also be required. Providing for this function could take place within the first half of the term of the next government.

One crucial and deliverable reform is the ending of any preferential access for patients with health insurance in public hospitals to theatre, admission, a specialist opinion or diagnostics. Health Insurance should get you a nicer room and other hotel-style benefits in a publicly-funded hospital, but nothing else.

As you all know, we are a long way from this sort of health service, and well behind other advanced countries. And of course there is a price tag attached to any new set-up or major reform of this nature. The funding required cannot – and should not – be taken away from frontline services. The reform process will need a dedicated funding stream of its own.

And the third question I posed was: how do you collect the money? Do you take it from tax, from social insurance, from health insurance, or from out-of-pocket payments, or some form of combination?

I am agnostic. I see no compelling evidence to favour one collection system over another. Australia has a two-tier system a little like ours, but because access to the public hospitals is timely and the most complex and specialist centres are in public hospitals, people really only take out health insurance for hotel-type benefits, but they do so in large numbers. In Britain, the health service is almost entirely tax-funded and provides timely access and reasonable outcomes. Nonetheless, a proportion do take out private health insurance policies, mainly with BUPA. They have a two-tier system too. It’s just a very different one.

The Dutch system rates high on quality and cost and operates under a multi-payer compulsory private insurance regime. Germany does it differently still. France differently again.

The reason their systems are relatively better than ours is because they get the other things right.

So, we need to get the other things right first before making the final leap – adequate funding and staffing, sufficient numbers of specialists, sustained investment in health and wellbeing, universal primary care, much stronger social care, autonomous statutory hospital trusts and community healthcare organisations, activity-based funding, and a health commission with a purchaser/provider split.

Ladies and Gentleman, earlier today I travelled to this place from Sligo. And this year, as you know, we mark the 150th an anniversary of that county’s great poet.

WB Yeats believed it was easy to get lost in the labyrinth we make in art or politics. Over the past 30 years we have made health a labyrinth, a maze to confuse and trap. To light the way out of our current problems, we need a realistic vision, and the time and determination to follow it to the end. In the next five years, with a political mandate behind us and a strong stable economy to finance, I believe we have a new opportunity to do exactly that.

Thank You.