I would like to start on the collection of costs from health insurers for treating private patients in the first place, and then on the 2008 consultant contract. As regards private patient income, before setting out the specifics in terms of recouping private patient accommodation costs, I would like to highlight a few points. First, we are not yet satisfied with the time it is taking to recover accommodation costs from health insurers for patients treated in HSE and voluntary hospitals. Second, the delays in processing claims create primarily cashflow issues, but do not affect the amount of money eventually recovered by hospitals from insurers. Third, in general, HSE and voluntary hospitals recover 97% of private patient accommodation costs from insurers.
A number of initiatives have been introduced to address this situation and they include the following. A high-level group from the HSE and the voluntary hospitals has been working with health insurers to streamline the claims processes. At the moment each private patient insurance claim essentially has two parts, which is the critical issue. The private accommodation costs are payable to the HSE or voluntary hospital and the cost for providing private clinical services is payable to the consultant or consultants.
Claims for hospital accommodation costs, however, are not accepted by insurers unless they are signed off by the primary consultant, so we cannot collect our money without the consultant having signed off on our bill. This administrative requirement causes major logjams. Ideally, we would like insurers to remove this requirement. This would mean that hospitals would not then be dependent on consultants signing off on claims forms to recover private patient accommodation costs from insurers.
Insurers have now agreed to process claims signed off by a secondary consultant where there has been a significant delay in sign off by the primary consultant. However, there is no doubt that this entire issue would be resolved to a large degree if we did not require consultants to sign off on our fees.
The VHI has also agreed at this stage to introduce an improved payment arrangement. As the Secretary General mentioned, a payment on account of €50 million has been agreed in lieu of payments due. We anticipate receiving this payment shortly. We are exploring the possibility of having similar arrangements with other insurers.
In addition, we are now beginning to centralise the HSE's entire billing system for all billings across the country, which will be based in Kilkenny. This centralised approach will streamline all insurance claims and debt-collection processes.
The most up-to-date position on insurance claims is that there are claims for private accommodation costs of approximately €51 million currently being processed by insurers. This includes claims which are the subject of further information requests from insurance companies amounting to about €11 million. Outstanding claim forms, including private inpatient and day-care accommodation costs, amount to approximately €94 million, which are awaiting sign-off by consultants.
We have now introduced a major drive to have all outstanding claim forms signed off by consultants, submitted and paid by the end of the year. This is a very ambitious undertaking and each hospital has been issued with a target it must meet. Achieving this target will treble our current weekly cost recovery from insurers until the end of the year to over €20 million a week. A major factor determining the ability of hospitals to meet this target will be for consultants to sign off on all insurance claims in a timely fashion. I would encourage the consultants to co-operate fully with their local colleagues in achieving this, as ultimately the collection of this money is critically important to maintaining front-line services. The insurance companies are co-operating with us in this specific endeavour. Hospitals can now submit claims as they are ready, rather than once a month.
Our drive to recoup costs from health insurers this year could result in a decrease in cashflow from this source early next year. To try to address this, next year hospitals will have specific debt recovery targets. Hospitals that fail to reach their target will be subject to budget sanctions. Our target is to recover all outstanding debts within 30 days.
I now wish to deal with the issue of the consultant contract. The consultant contract 2008 introduces reforms which will benefit patients, move towards a consultant-provided service, and maximise the return from taxpayer investment in existing and additional consultant posts. These include the following: a longer working week of 37 instead of 33 scheduled hours; a longer working day, potentially from 8 a.m. to 8 p.m. instead of 9 a.m. to 5 p.m.; greater equity for public patients through a public-only contract type; limits on private practice and a common waiting list in diagnostic services; measures to ensure high quality services and patient safety; and the introduction of clinical directors — which is a huge advance — to manage consultants' clinical work and ensure that clinicians have a senior role in planning and managing services.
Some 1,688, or 90%, of the 1,888 consultants employed by the HSE in August 2008 signed up to the new contract. In addition, we have since created 218 entirely new consultant posts and approved 195 replacement consultant posts under the new contract. Over 400 consultant posts have been put in place since this. This represented a 10% increase in the overall number of consultant posts when one takes the new posts into account. It means that the new contract applies to 86% of consultants. The figures are that 2,025 of the existing 2,350 consultant posts have now taken the contract.
A unique and significant feature of the new contract is the creation of the post of clinical director. Clinical directors are key members of local corporate management teams. They plan how clinical services are delivered and how resources are employed. They contribute to deploying and managing consultants, strategic planning and achieving local clinical priorities.
Consultants report to their assigned clinical director who monitors and manages the public-private mix of their work where relevant, and develops and manages rosters. The current emphasis is on introducing rosters so that there is on-site consultant cover 12 hours a day, maximising the value of the additional four hours per week from each consultant. Clinical directors also deal with a range of other quality, safety and organisational issues.
In early 2009, a process started to verify that the new contract was being implemented as planned. I note the co-operation we have received from the four postgraduate training bodies for the different specialties in establishing and implementing what I believe is a unique form of clinical directorate in this country. It is one that will be of immense interest to other countries in terms of the success in getting it going.
A key element of the contract is the regulation of each consultant's public and private practice. In September 2008, we introduced new measurement systems to do this. The measurement system has been rolled out to the 49 acute hospitals and captures inpatient and day-case activity carried out by each consultant. This is weighted for case mix, which is extremely important as it gives an indication of the complexity or lack of complexity of the work. It reports on the level of private practice on a monthly basis. Details of on-site private outpatient activity and certain diagnostic activity are being collected manually by hospitals as an interim measure pending the development of an automated data collection system. The agreement and rules under which these measures were collected has been a huge undertaking and has now been agreed by all.
Consultants employed by the public health service, irrespective of whether they are employed under the consultant contract 2008, are now issued with a public-private mix measurement report every month. This documents their activity in regard to inpatient, day case and outpatient activity during the previous three months.
This measurement system is essential and when combined with the performance data we are now collecting through our HealthStat process, we have a very powerful combination to drive change. HealthStat concentrates on the output and throughput of facilities and individual consultants. By comparing data across the system, we can establish where taxpayers' investment is having the greatest impact and can make effective planning decisions based on this data.
The third interim report of the Committee of Public Accounts on the 2006 report of the Comptroller and Auditor General in regard to the health service made a number of recommendations and we believe our implementation of the key provisions of the consultant contract 2008 has significantly addressed these recommendations.
