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COMMITTEE OF PUBLIC ACCOUNTS debate -
Thursday, 14 Jun 2018

Engagement with Nursing Homes Ireland

We will continue with an engagement with representatives of Nursing Homes Ireland. We will examine the 2016 financial statements of the National Treatment Purchase Fund and matters related to the fair deal scheme. To assist us in our examination, we have invited representatives of Nursing Homes Ireland to discuss related matters with us in a short session before we deal with the National Treatment Purchase Fund.

I remind members and those in the Public Gallery that Nursing Homes Ireland is not a public body and its representatives are here voluntarily. We are joined today by Mr. Tadhg Daly, chief executive, Mr. Maurice Pratt, chairperson, Ms Vicky McDwyer, director and Ms Sinead Morrissey, practice development facilitator. Behind them are Mr. Michael McGlynn and Ms Fiona Kenny. They are all welcome to today's meeting. I apologise for the late start. We had indicated that we would meet this morning. We had representatives of the HSE and the State Claims Agency in and it went on much longer than we had predicted. I thank the witnesses for waiting for us. As a result we are tight for time and, therefore, I ask the witnesses to be as concise as possible with their opening statements. They do not have to read it all. The key points will be sufficient.

I remind members, witnesses and those in the Public Gallery to turn off their mobile phones or to put them on airplane mode. Putting phones on silent is not enough because it will interfere with the recording system. I advise witnesses that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable.

While we expect witnesses to answer questions put by the committee clearly and with candour, witnesses can and should expect to be treated fairly and with respect and consideration at all times.

I ask Mr. Tadhg Daly for a synopsis of his opening statement.

Mr. Tadhg Daly

I thank the committee for its invitation to appear. The committee has received my opening statement and the associated appendices, so I do not propose to read it in its entirety in the interest of time.

As an organisation, Nursing Homes Ireland has previously provided this committee with evidence of gross inequity that has been applied by the State in the utilisation of the fair deal scheme budget. We have had previous correspondence with the committee. We also made a submission in March 2017. The budget amounts to almost €1 billion of health spending per annum. The way the State spends that budget effectively means that HSE nursing homes are being paid fees that are, on average, 60% higher than those payable in respect of residents in the private and voluntary sector. In some instances, the fees in respect of residents in HSE nursing homes are four times those provided for residents in the private and voluntary sector. That is outlined in detail in appendix 1. In excess of 70% of private and voluntary nursing homes are small family-run, owner-operated business with fewer than 60 beds. Independent analysis provided to the Department of Health described the scheme as operating in an ad hoc manner, lacking rationale, consistency and fairness, only applying to the private sector and in the long run being unsustainable.

The NTPF is abusing its dominance as a monopoly purchaser, threatening the viability of the private and voluntary nursing home sector. Last week, HIQA, the independent regulator, informed of the voluntary closure of five nursing homes during 2017 due to financial concerns. Its report states: "There are examples of certain smaller nursing homes – which provide a more homely environment – closing voluntarily due to concerns over the financial viability of running such services."

Private and voluntary nursing homes provide care in a home from home to more than 23,000 residents throughout the country. Nursing homes are an essential part of our health service, providing care in the community in line with Government and cross-party support, as presented in the Sláintecare report. Four in ten applications for the fair deal scheme are from persons in acute hospitals. Each year, almost 9,000 people, which is an average of 800 per month, avail of transitional care in private and voluntary nursing homes. Without our sector, acute hospitals would grind to a halt.

HIQA's report last week stated, "nursing home providers are committed to excellence and striving continuously to improve the quality of their services". Furthermore, the regulator stated, "inspectors met and spoke with many people who use services and found that they were well looked after by competent and caring staff".

Our members are tasked with providing care under the fair deal scheme for fees that are, on average, 60% less than those payable to HSE counterparts. It is a fact that one third of the fair deal budget is allocated to State nursing homes that provide 20% of capacity. The fees in respect of HSE nursing homes are not subject to independent scrutiny. There is no negotiation process, no scrutiny of expenditure and no transparency, and there is long delayed and infrequent publication of those fees.

Another anomaly I bring to the attention of the committee is the myriad costs, including but not limited to capital costs and commercial rates, that are not included in the publicly published fees. Appendix 2 contains the statutory instrument, which was laid before the Houses of the Oireachtas on the commencement of the scheme. The HSE, as administrator of the scheme, in effect pays the nursing homes under its control whatever fee it deems appropriate.

The most recent publication of HSE fees in February this year revealed the disparity in fees between HSE and private nursing homes has increased from 53% to 60%. Over the 16 month period from October 2016 to February 2018, the fees in the HSE or State sector increased by an average of 11%. Over the corresponding period, the increase in private and voluntary nursing homes was on average 3.9%. Analysis of the most recent data informs the extent of this disparity. Appendix 1 outlines the examples of County Westmeath, where the fee differential is 163%, County Laois where it is 122% and County Longford where it is 115%.

There has been some admission by the State that the cost of care in public nursing homes requires deeper analysis. The review of the fair deal scheme, published in July 2015 and commissioned by the Department of Health, recommended a value for money review be undertaken by the Department with regard to public nursing home costs. The review recommended actions and timelines to address any cost distorting factors that cannot be attributed to inherent differences between the public and the private sectors. That was in 2015, more than three years ago. Speaking to the committee in March last year, representatives of the HSE committed to the review being undertaken in 2017. It remains outstanding. In April 2018, the Minister for Health informed the Dáil of the value for money analysis and stated the Department would work on the analysis throughout 2018. We highlight that accountability and transparency remain outstanding with the continued delay of the value for money review.

The gross inequity in the funding of nursing home care is threatening the viability of the private sector and I mentioned the five nursing homes that closed last year. The Department of Health's DKM Economic Consultants report, published in 2015, stated the fair deal pricing model "operates in an ad hoc manner, lacks rationale, consistency and fairness, only applies to the private sector, and in the long run is unsustainable". This is the pricing model set by the NTPF, whose representatives will appear before the committee after this session. Of stark concern, the report warns: "It is untenable that the State quality regulator can assess differentiated dependency levels and in doing so impose costs on nursing homes, while the State price regulator (NTPF) claims it is unable to reflect the same factor in its pricing decisions".

When the fair deal scheme commenced in 2009, a commitment was made that it would be reviewed after three years. The review was published six years later, in 2015. It pointed to the NTPF in its methodology used historical prices and, on many occasions, geographical location to set fees. It stated there was a requirement for a review of the system to be undertaken within an 18 month period. Thirty-three months on from this recommendation, and nine years after the introduction of the fair deal scheme, this pricing review of the scheme remains outstanding. This is evidence of prevarication by the NTPF, inexcusable delays and a lack of transparency from what is, in essence, a public body.

To say our members are frustrated would be an understatement. We reiterate our call for the publication by the NTPF and the Department of Health of the pricing review. In Appendix 5 of our submission we have outlined what we argue are some pertinent questions the committee may consider appropriate for the NTPF in the afternoon session. Our members are under sustained pressure to sustain services. It is unsustainable and untenable that the State tasks private and voluntary nursing homes with providing this specialist care for such low fees, which are, on average, 60% below those applied by their HSE counterparts. The inequity in the fair deal scheme is compounded by the fact there is no independent appeals process in the NTPF. This effectively means the NTPF, acting on behalf of the State, can adopt a take it or leave it approach with regard to fees to provide care regardless of the consequences.

The fair deal scheme is explicit and definitive in defining the goods and services covered. It explicitly excludes a range of services, therapies, specialised wheelchairs, transport and social activities that are essential to support the health, well-being and day-to-day living of nursing home residents. In Appendix 3 of our submission we have included the extract from the NTPF deed of agreement which our members are required to sign to be party to the scheme. Nursing homes are obliged to provide certain services that are explicitly outside the definition of long-term residential care services. Accordingly, it is appropriate for nursing homes to charge for services provided that are outside the definition. All charges for services excluded under the fair deal scheme are detailed in the contract for care and agreed with the individual resident on admission to the nursing home, as required by regulations. The regulatory requirements stipulate registered providers must ensure that contracts of care are clear, unambiguous and contain full details of the services to be provided and any charges. Our guiding principles as an organisation commit our members to clarity, openness and transparency with regard to all fees and charges.

It is also a fact that there is discriminatory or limited access to medical card services for residents in private and voluntary nursing homes. When people cross the threshold of a private nursing home the services they would ordinarily hold on to in their community are no longer available. This is discrimination of older people on the basis of where they reside, which is, in essence, their home.

The NTPF, as a monopoly purchaser, adopts a take it or leave it approach to negotiations. The Department of Health review informed that pricing is set on historical and geographical determinants and, as I stated, there is no independent appeals process. We acknowledge and respect the role fulfilled by the HSE in nursing home care and the dedicated staff in the public service. However, very serious questions arise surrounding transparency, accountability and fair allocation of funds for the provision of care in HSE nursing homes.

That the Government committed to a review of the system for pricing is an acknowledgement that the current pricing system is not fit for purpose. Appendix 4 of our submission sets out the terms of reference for the pricing review. The committee will note that according to one of the terms of reference, the deadline for completion was 1 June 2017, which is more than one year ago.

The minutes of the meeting of the working group to oversee the recommendations confirm that Deloitte and Prospectus provided a draft pricing report to the Department in June 2017. The minutes further confirm that the NTPF requested a revised draft to be produced, and confirm that the revised draft has been received by the NTPF and is being considered by it. This draft report has not been published. We are concerned about the delay in publishing the report.

The harsh reality is that the State wants to fund care for residents in the private and voluntary nursing home sector for fees that are significantly less than what it costs the State to provide such care. Critically, policymakers need to ensure the system strikes a balance between value for money and acknowledging the costs and ensuring the sustainability of the private and voluntary sector. While the private and voluntary sector is characterised by committed and resilient providers and staff, it is undoubtedly the case that failure to acknowledge the true cost of care threatens the sustainability of current provision. Transparency must be applied to HSE expenditure. We welcome the committee's examination of NTPF and wish it well with its work.

I thank Mr. Daly very much for that comprehensive statement.

Speakers have indicated in the following sequence: Deputy MacSharry, Catherine Murphy, Cassells and Connolly. We will have ten-minute slots.

I might not even need the ten minutes but I thank the Chairman.

In fairness to Mr. Daly, he probably gave us much of the information in the pack. Could he give me the average price for one of his members compared to the average on the State side?

Mr. Tadhg Daly

It is €963 versus approximately €1,400. We can get the exact figures for the Deputy in a moment.

It is okay. The figure is €1,400. Why is there such a wide difference?

Mr. Tadhg Daly

As I have said in the statement, there is no accountability or negotiation whatsoever with the HSE. In effect, it sets its own fees irrespective of anything else. Based on my statement, I argue that, given that a number of nursing homes closed last year and that the regulator has highlighted the fact that they have closed due to financial and viability concerns, the fee in the private sector is lowballed, which has serious implications for the sustainability and viability of the sector and for the continued growth required in the sector given the ageing population. Quality will also be an issue.

Mr. Daly said a take-it-or-leave-it approach is employed. Is Mr. Daly advised that the HSE operates to certain criteria or metrics? He mentioned that the arrangement is based on historical pricing and geography. Is there any formula provided to Mr. Daly stating how the calculation is done?

Mr. Tadhg Daly

Yes, they have criteria. They are quite vague and open to interpretation. We have argued that there is a requirement for a model that recognises the true cost of care and the inputs that are required, recognising capital costs, the return on investment and all those elements.

Mr. Daly said geography seemed to be one of the criteria. If Mr. Daly had a member in Dublin 2, Dublin 4 or Dublin 6 and another in Sligo, for example, what would be the difference in running costs for them? Are they not paying staff at the same rate and paying the same amount for electricity services?

Mr. Tadhg Daly

We do not negotiate. The negotiation is done by each individual member.

I understand that.

Mr. Tadhg Daly

It is a matter for the individual member to put forward its-----

From talking to your members, does Mr. Daly believe there is a difference in cost? If I own a nursing home in Sligo and Deputy Cassells owns one in Dublin, will he have more overheads than me? Does he have to pay higher salaries for physicians and staff? What are the facts?

Mr. Tadhg Daly

There are variants, obviously. If people are building a newer home in Dublin, for example, the cost of building and developing land is much higher. In terms of the cost of capital and servicing and financing the capital, the cost would be significantly higher.

That is in terms of building a new home. Apart from that, what about operating costs?

Mr. Tadhg Daly

Nursing homes across the country differ in terms of the services they provide. At this stage, it is all maximum dependency because the fair deal scheme has a care needs assessment such that only those who are regarded as maximum dependency are accepted. The average age is now almost 83. The patients are older now and more dependent. There are varying factors but it is a matter for each individual member to negotiate the fee that is pertinent to its operation. The National Treatment Purchase Fund examines all accounts and records. It has full visibility of the nursing homes' individual costs.

Has Nursing Homes Ireland, as a representative organisation, criteria that it would like to see employed in terms of the allocation? Does it simply want the same money being paid on the State side?

Mr. Tadhg Daly

No, what we are saying is that there needs to be a model that is transparent and equitable and that considers the care needs of the resident rather than just deciding on a fee that the State, as the monopoly purchaser, decides would be appropriate.

As part of Nursing Homes Ireland's own research, has it come up with a model that it feels should be employed?

Mr. Tadhg Daly

A number of years ago, one of the organisations that preceded Nursing Homes Ireland produced a cost-of-care model. There are definitely models. We have worked with Deloitte ourselves on a cost-of-care model. We argue that there needs to be more transparency, equity and fairness. What people feel at the moment is that, as a provider, one is beholden, in effect, because if one does not agree a rate with the National Treatment Purchase Fund-----

Mr. Tadhg Daly

Absolutely. One is out of the fair deal scheme and one might as well turn-----

I wonder whether it would be helpful in our work if Nursing Homes Ireland sent us its vision of what the model should be. Transparency, accountability, openness and fairness are all very general terms.

Mr. Tadhg Daly

We made a submission to the pricing review that we can send the Deputy. That details some of the features we argue should be part of the pricing model.

What kind of push-back is Nursing Homes Ireland getting from the National Treatment Purchase Fund or higher up in the general HSE on that?

Mr. Tadhg Daly

Our concern is that the fair deal pricing review was to be published over a year ago. Deloitte and Prospectus completed their work on time and submitted it but nothing has happened since. As the Deputy can imagine, we are justifiably concerned over the delay.

I appreciate that individual members negotiate their own rates. However, has Nursing Homes Ireland come across a clear discriminatory practice whereby nursing home A is getting X per day and nursing home B is getting X multiplied by two, or plus €50, per day?

Mr. Tadhg Daly

Appendix 1 to the documents we have provided breaks down the county averages in their entirety. One will see the full list of all the fees.

Would Mr. Daly say that the differentials there would underpin discrimination based on no criterion other than that members can be forced to take less in one area while they may have to be paid a little more somewhere else?

Mr. Tadhg Daly

Ultimately, what we are concerned about is that there is not a transparent model. If I were a nursing home owner, I would have to determine the detailed criteria used by the National Treatment Purchase Fund, as a State purchaser, rather than just refer to historical fees that were set, as referred to in the fair deal review, or, indeed, county averages. The former Minister of State, Kathleen Lynch, is on the record of the House as outlining that the idea of a county average bears no relevance either to the cost of providing such a service or the standard of care.

I have a question on membership. Have nursing homes attached to religious organisations, such as Brothers of Charity in Roscommon, evolved and become private? Are such organisations members of Nursing Homes Ireland?

Mr. Tadhg Daly

Yes. We represent the private and voluntary sectors.

So the likes of Brothers of Charity-----

Mr. Tadhg Daly

Nazareth House, in the Deputy's constituency, for example, is a member of our organisation.

It would be a member, as with Brothers of Charity.

I noted in some of the research some of the issues that have arisen. Mr. Daly mentioned that additional charges for social outings, etc., are agreed with the patient when he or she arrives, and that they are not covered under the various schemes. I came across a case where people in certain institutions were being charged for incontinence wear over a lengthy period. Are there now clear guidelines on this?

Mr. Tadhg Daly

A private resident may be paying for incontinence wear. Where a person is under the fair deal scheme, a supply is provided by the HSE, but it is not unlimited. The HSE actually restricts the supply to a certain number of incontinence pads per day.

How does it do that scientifically? Are people told?

Mr. Tadhg Daly

Three per day. If a person requires more-----

What happens then?

Mr. Tadhg Daly

They may have to pay for that on top of what is provided under the GMS, effectively. I made a point in my opening statement on the discrimination against older people on the basis of where they reside. If one is in a public nursing home, for example, there might not be charges for social activities and social programmes so it raises the question as to where the budget comes from. If one is in the private sector, however, one will have to pay for those services, despite the fact that there is one statutory scheme with the same rules for everybody. Therefore, the rules are not being applied equally.

If one is in the scheme, one still gets only three per day regardless of individual need.

Mr. Tadhg Daly

Yes.

Is that money taken from people's pensions?

Mr. Tadhg Daly

Under the fair deal scheme, with which the Deputy is familiar, a person pays 80% of his or her income and retains 20%. The contribution would come from that or it may come from families who would contribute. It would be with the agreement of the resident. It would be outlined in the contract for care, as required by the regulations. It is clear and transparent. Many members advocate on behalf of residents to try to increase the provision but if it is not forthcoming it might be that the person would have to pay over and above what would be regarded as the standard.

It has come up at meetings of this committee that the chairman of HIQA, in a different capacity, attended a meeting of Nursing Homes Ireland to speak or provide advice. Would Mr. Daly like to tell us anything about that? It created some interest here that someone holding such a senior position in an agency responsible for regulating its members, public and private, had done so and why the chairman was inviting wearing a different hat, in the role of providing financial advice rather than as an after dinner speaker. It might be helpful in our deliberations if Mr. Daly cared to put anything on the record now.

Mr. Tadhg Daly

Mr. Brian McEnery, who was chairman of HIQA at the time, was invited to a number of our meetings. He spoke at several of our conferences but did so in his capacity as head of healthcare within BDO Ireland.

What is Mr. Daly's view of the head of healthcare in BDO Ireland being chair of the regulatory body?

Mr. Tadhg Daly

That is a matter for the Public Appointments Service.

It is but I wonder what is Mr. Daly's view?

Mr. Tadhg Daly

Mr. McEnery is an adviser to many nursing homes, as are many other financial firms around Ireland. At that time he undertook an annual survey, for example, and engaged with the NTPF on behalf of individual members. He had a great deal of financial knowledge and we felt it was appropriate that he would speak but, to be clear, he did so in his capacity as head of healthcare in BDO Ireland.

Did Nursing Homes Ireland engage him under the auspices of his role in BDO Ireland?

Mr. Tadhg Daly

We did not pay him, if that is what the Deputy means. It was an invitation to a meeting.

I understand that about that particular meeting. Generally, would Nursing Homes Ireland use BDO Ireland to say that it was getting the short end of the stick and ask how should it go about getting a fair deal in terms of being paid?

Mr. Tadhg Daly

We did an annual survey with BDO Ireland on one occasion, and we did a report with them on health's ageing crisis in 2012 or 2013. We also engaged with PWC for a submission to the Minister for Finance and Deloitte undertook our pricing model. We engage with several firms in the financial and legal sphere to assist us as an organisation.

How many private and voluntary nursing homes are in the country?

Mr. Tadhg Daly

Approximately, 440, and as an organisation, we represent 374.

Nursing Homes Ireland represents more than 80%.

Mr. Tadhg Daly

Approximately 85%.

I call Deputy Catherine Murphy who has ten minutes.

Negotiation takes place with each individual nursing home. It cannot be with a group because that would be in the territory of cartels. The NTPF tries to get best value for money in a contractual arrangement. Is that done on the basis of "Take it or leave it"? How does the NTPF negotiate with individual nursing homes? If I opened a nursing home tomorrow, how would I negotiate a price?

Mr. Tadhg Daly

Essentially, each individual nursing home negotiates an individual price. Based on feedback from our members, we argue that it is done on a take it or leave it basis. I am sure that members of this committee and other Deputies will have received representations on this model. Existing nursing homes have a deed of agreement that runs for a defined period, perhaps one, two or three years, at which point it comes up for renegotiation. In the case of a new nursing home, it would have to contact the NTPF and enter negotiations. It highlights what we see as a lack of sophistication in the model. Sometimes it is based on the average county rate, irrespective of the service provided.

If one is negotiating on anything, one will seek best value for money. How much information does Mr. Daly think should be publicly disclosed? To play devil's advocate, were the NTPF to disclose various methodologies, would this put the fund at a significant disadvantage and increase its costs?

Mr. Tadhg Daly

The Deputy referred to value for money. The private and voluntary sector is clearly providing that. Our concern relates to the residents. If we keep putting pressure on fees, it will have an impact on the viability and sustainability of services, and on standards. As I noted in my opening statement, the State knows what it costs to provide 24-7 residential care, because it pays that in its own facilities, but then it tries to pay up to 60% less in the private and voluntary sector. There is a benchmark, which is what the State is paying its own facilities.

Is it a case of like for like?

Mr. Tadhg Daly

Absolutely. According to HIQA reports, the standard of building and physical environment in the private sector is better than many in the State sector. Dependency levels is a line thrown out from time to time but in effect there is a care and needs assessment. All those who are assessed as requiring residential care are assessed by the HSE. The Dementia Services Information and Development Centre highlighted that the HSE was much more restrictive in its admission policy regarding residents who are not independently mobile.

I am trying to get a handle on this. Sometimes older buildings are more costly because they are not purpose-built. It might require additional staff to move people around and so on, and there can be historical costs such as pensions. Has Nursing Homes Ireland conducted an analysis or does it have the documentation to demonstrate that it is a like for like cost?

Mr. Tadhg Daly

When the Deputy referred to "like for like", I referred to the service that is being provided. The value for money review is being undertaken because the State is concerned that HSE costs are spiralling out of control. In a 16-month period, between October 2016 and February 2018, there was an 11% increase. I have provided the members with the figures. They can see that it would be an understatement to say that the differential is significant. That is why the value for money review is important to get a handle on what the costs are and to verify their legitimacy.

Are the terms of reference for the review which has been promised but has not been undertaken still valid or has anything changed?

Mr. Tadhg Daly

Under the terms of reference, No. 1 was to ensure the adequacy of capacity, continue to ensure value for money, and, returning to Deputy MacSharry's point, increasing the transparency of the pricing mechanism in order that existing and potential investors can make the most informed decisions possible. The fact that is provided for in the terms of reference is an acknowledgement that there is a lack of transparency in the current model. The other two terms we would highlight are No. 6, which highlights that particular consideration should be given to an independent appeals mechanism, which is currently absent, and No. 7, which referred to the appropriateness or otherwise of a system where it can be proofed against inflation in relevant areas of cost for a number of years.

Presumably an appeals process would only apply if there was a methodology to measure it against. It is not relevant unless the review takes place.

Mr. Tadhg Daly

Given that the NTPF is a monopoly purchaser and there is an imbalance of power, nursing homes are effectively price takers. In that case, there should be an independent appeal, having exhausted internal mechanisms. We do not suggest that everybody should go to independent appeal at the first hurdle. Rather, there would be an internal process and, all things being equal, when negotiations break down, it would go to external appeal.

Standards apply to the staffing ratios of nurses and care staff to patients. Who sets them?

Mr. Tadhg Daly

The standards are set by HIQA, but they do not specify the ratio of nurses or carers; rather, it has to do with the appropriate skill mix relative to the care needs and dependency levels of the residents. Particular numbers are not set.

The same standards apply to public and private settings.

Mr. Tadhg Daly

Yes.

Do other organisations set other standards?

Mr. Tadhg Daly

The HIQA standards were introduced in 2009 and there has been a positive development. My report highlights how providers are striving continuously to improve and that the feedback from residents is that they are being well looked after by competent and caring staff. HIQA's standards cover the full gamut from medication management to the physical environment and so on. There are other standards with which nursing homes have to comply, for example, fire safety, environmental health and Workplace Relations Commission standards.

I am just referring to quality of life. No standards are set.

Mr. Tadhg Daly

That would be covered by the HIQA standards.

Do they also cover occupational therapy and activities for residents?

Mr. Tadhg Daly

Yes. That is the point I was making in my opening statement. Under the regulations, nursing homes are obliged to provide a range of activities and services for residents to ensure their quality of life. However, these matters are expressly excluded under the fair deal scheme. That is the disconnect. On the one hand, an arm of the State has sets standards, with which we agree and support, for the provision of a range of facilities and services, while, on the other, a different arm of the State has not included these matters in the fair deal scheme. That is where the element of charges arises.

What is the average cost of the differential or does it vary?

Mr. Tadhg Daly

It varies. All nursing homes must agree a contract with the individual resident based on his or her care plan, care needs and likes and dislikes. Nursing homes are providing people with individualised care plans that meet their particular needs. The Deputy's will and preferences might differ from mine, for example.

I thank Mr. Daly.

I have a few questions for the witnesses, whom I welcome. The nursing home sector is important. As Mr. Daly stated, hospitals would effectively grind to a halt if the sector did not operate efficiently. When one considers that 30,000 people call one of the 458 private or voluntary facilities or the 122 public facilities home, it crystalises how important the sector is.

That 79% of facilities are private makes the points the witnesses have articulated for us all the more important in how we tease out the funding mechanisms. In the HSE's 2016 accounts some €900 million was allocated for nursing home support schemes. From a public expenditure point of view, the Comptroller and Auditor General would be interested in examining how that nearly €1 billion was spent and, if there were significant disparities in the funding models, determining how to go about addressing them. The facts outlined by the witnesses speak for themselves and show the major disparities. Under the fair deal scheme, a private provider has an average spend of €35,000 versus an average spend of €71,000 in the public sphere.

Deputy Marc MacSharry touched on the issue of geography. The methodology is similar to that used to fund local authorities. It is difficult to work out from the graph on screen. The Deputy used the example of Dublin versus Sligo and cited land costs. In my county of Meath there is an average weekly cost of €1,600 in the public sector versus €2,200 in the adjoining county of Westmeath, which is difficult to understand.

Mr. Daly touched on the type of care provided. According to his opening statement, many people with dementia were refused admission to HSE-operated facilities because they were "not independently mobile". If those with the most pressing and complex needs find themselves in private nursing homes and public homes are being funded to the tune of twice what private providers are receiving, how does it impact on the quality of care provision by and the resources available to private providers? I am interested in hearing his views on how such homes are even surviving.

Mr. Tadhg Daly

I thank the Deputy for his question. In essence, it is why we are before the committee. Recently, we engaged with the Office of the Comptroller and Auditor General and met some of his officials who were undertaking an examination of the scheme. The Deputy referenced my opening statement. It was not us saying it-----

Mr. Tadhg Daly

-----but the Dementia Services Information and Development Centre. It also states, curiously, that HSE facilities which receive the highest payments because they are said to be accommodating those with the highest needs are more restrictive. We see this on an ongoing basis. Likewise, the review of the fair deal scheme's pricing methodology referred to this approach lacking logic, being ad hoc and only applying to the private sector. When it was introduced in 2009, the aim of the fair deal scheme was to ensure equity and fairness for all residents and providers. Instead, the disparity with what the HSE pays for its own facilities has grown since. It is putting significant pressure on our sustainability. This has been verified independently by HIQA which has outlined that five nursing homes closed voluntarily in 2017.

Mr. Daly mentioned that the disparity had serious implications for quality. I am sure his members are complying with the HIQA standards as they should-----

Mr. Tadhg Daly

Yes.

-----but if the disparity is so large and the care needs of their residents are more complex and greater than those found in the public care system, how are the standards being maintained? Is there the potential for safety to be compromised?

Mr. Tadhg Daly

Based on last week's HIQA report, thankfully, that is not the case. Our members and their staff are deeply committed. They go above and beyond the call of duty.

Is it then the case that the funding provided meets the needs of facilities? Let us leave aside the question of how much funding is going to the public sector. Is the funding level adequate to cover the services provided by Mr. Daly's members?

Mr. Tadhg Daly

No. Our members have been closing on an ongoing basis. A number closed last year. We are not saying this - the regulator is. Like many small businesses in rural Ireland, our members are constantly refinancing to try to keep their businesses afloat. A lot of them are the largest employers and major service providers in many parts of the country. If we continue down this road, one need only look across the water at what is happening in Britain to see that there will be a serious impact on the entire health and social service. That will come our way if the disparity is not addressed quickly.

By how much is the public sector overfunded per head?

Mr. Tadhg Daly

That is what the value for money review should-----

In Mr. Daly's opinion. His body conducted an analysis of its members. In terms of their operational costs, by how much are they underfunded, given an average spend of €35,000?

Mr. Tadhg Daly

It is probably in the order of 40% to 50%, but the figure varies.

How are businesses surviving if it is of that magnitude?

Mr. Tadhg Daly

A number of them are closing. Some of them-----

At that magnitude, surely more will be closing on a regular basis.

Mr. Tadhg Daly

I do not want to sit here in a couple of years' time and tell the committee that more have closed. It would not be in anyone's interests, particularly given that we have an ageing population, but it is the reality and what I am hearing every day from our members who are literally living hand to mouth in trying to keep their businesses afloat. More than 70% are small family-run businesses. I argue that many providers are probably not remunerating themselves appropriately for their work. Family members may be helping out in many cases. That is the reality on the ground for a 24/7 business.

On quality, HIQA's previous report pointed out that providers were striving continuously to improve their services. However, if we continue to exert downward pressure on fees, it will have a serious impact on the sustainability of services and quality.

Towards the end of his report, Mr. Daly touched on the charges for the services being excluded under the nursing home support scheme. He outlined how it is explicit in what it provides, namely, basic care, bed and board, bedding and laundry but it does not include such basic things as newspapers, hairdressing, activities and transport. This is an issue I raised with the Ombudsman, Peter Tyndall when he was before the Committee on Public Petitions two weeks ago. He was talking about dealing with complaints from nursing homes and he touched on this specific issue because he said it was leading to the impoverishment of our elderly. He said that he saw situations where grandchildren were coming into nursing homes with more money in their pockets than the grandparents they were visiting and that was leading to an eroding of the autonomy of these people. He was looking at a case where they had maybe €7 per week to live on. I raised this with the Taoiseach on Tuesday and again he was kicking to touch saying that Minister of State at the Department of Health, Deputy Jim Daly, was looking at it and so on. I ask Mr. Daly to comment on that in terms of the contract for care and what needs to be addressed.

Mr. Tadhg Daly

We have been very clear from the outset of the scheme. When the scheme was launched in 2009, as an organisation we sought leave for judicial review of the scheme on the basis of the definition of long-term residential care services. We were very concerned at the narrow definition of long-term residential care services and the fact that it explicitly excluded many of the services that would be regarded as being included in such a scheme. We concur with the Ombudsman's concern around the fact that on the one hand a resident pays 80% of his or her income and then on the other hand he or she is told that it does not cover everything because the National Treatment Purchase Fund, NTPF, under section 40 of the Nursing Home Support Scheme Act 2009, has defined a long-term residential care service. That is why we have included that in appendix three to show the committee exactly what is included and excluded.

That is a hugely important point. If there is a situation where the Ombudsman is coming into a committee and saying that it is leading to the impoverishment of our elderly people and that their grandchildren have more money in their pockets than they do, it is not a case that they are living. They are just seeing out their time; it is like a jail sentence. I agree that it has to be addressed.

I ask the Comptroller and Auditor General for his view on the huge amount of public money that is being put into this sector and how we can look at a situation where care is being provided on the private side and is complying with Health Information and Quality Authority, HIQA, standards at an average spend of €35,000 and yet double the amount of money is being spent in the public side. Can Mr. McCarthy get his head around how this has been allowed to develop over a period of time?

Mr. Seamus McCarthy

I would prefer not to be definitive or make any statement until I have finished the casework which we are doing.

It would at least raise cause for concern.

Mr. Seamus McCarthy

Absolutely and the pricing and differentials in pricing are the subject of what we are looking at, among other things.

I have one question before we move on to Deputy Aylward. Did Mr. Daly mention that five nursing homes closed last year?

Mr. Tadhg Daly

That is right.

Out of over 400. Did any open last year?

Mr. Tadhg Daly

I would have to check the figure to be correct but I would say it was two.

Over the last four or five years - I know Mr. Daly said a few close each year - that is 1% of families retiring or getting out of the business. I know HIQA made the comment. Are many are coming into the sector?

Mr. Tadhg Daly

It was quite small in the past couple of years. There has been some additional capacity in north Dublin, but if we go back to the period of 2003 to 2009 the numbers were much more significant. The point I was making is that HIQA, as the regulator, highlighted the fact that it was due to financial viability.

HIQA said that.

Mr. Tadhg Daly

It said that in its own report.

I take that point. I call Deputy Aylward.

Unfortunately, my questions might overlap with much of what has been asked because we all ask the same kind of questions. I will start with the pricing review. Mr. Daly said it has been overdue for two or three years. Who is holding up the pricing review and who is involved? What role do the NTPF, the HSE, the Minister and the Department of Health play? Among all four of those, who decides on what will happen in the future? Why is it being held up? What does Mr. Daly think the reason is that the review is not taking place sooner rather than later?

Mr. Tadhg Daly

As I said in my opening remarks, it was mentioned when the review was published in 2015 that it would be done within 33 months so it was due on 1 June 2017. As I understand it, the minutes that have been released under freedom of information confirm that Deloitte and Prospectus submitted their piece on time. In essence that is a question for the NTPF which will be in this afternoon because we are concerned at the delay and prevarication around publishing that review.

What role do the HSE, the Department of Health, the Minister and the NTPF play? What role do they all have in deciding the scheme and services that we want into the future?

Mr. Tadhg Daly

The Minister and the Oireachtas set the legal parameters. The Health Act 2007 and subsequently the Nursing Homes Support Scheme Act 2009 are set by the Department of Health and the Minister and ratified by the Oireachtas, so that is that element of it. The HSE is the administrator of the scheme so it administers the budget on an annual basis and the NTPF has a role which is confined to negotiating with the private sector.

Who does Mr. Daly hold responsible for dragging their feet on the review?

Mr. Tadhg Daly

Well the review-----

I am putting Mr. Daly on the spot but-----

Mr. Tadhg Daly

I am surprised and disappointed that the NTPF have not published that pricing review.

Why does Mr. Daly think it is doing that? Why does he think it is dragging it out and keeping it going for over a year?

Mr. Tadhg Daly

That is a matter for it to answer.

We will ask it later on but I wanted to get Mr. Daly's view on it.

To come back to what Mr. Daly said in his opening statement that a quarter of State funding for nursing home care is going towards public nursing home costs. They are only caring for 20% of residents. That means that 80% are in voluntary and private nursing homes. That is very unfair and the figures Mr. Daly is throwing out do not sound right to me. One third of all the money that is being spent is going towards 20% of the care. That means two thirds is going to 80% of the care. Straight away there is something wrong and there are questions marks over that. In my own county of Kilkenny, there is one nursing home and eight voluntary and private homes. I get representation on a continuous basis from the private nursing homes in my area, which is natural being a local politician. The voluntary sector has to fundraise. I know that because there are one or two of them very near to me. I give towards the fundraising as well because it is just to keep the doors open. This sounds very wrong. One nursing home in Kilkenny costs €1,596 per week while in the voluntary and private sectors, it costs €901 per week. That is almost €600 of a difference, or 77%, according to the chart in front of us. That is massive money. I want to keep all the services open because they are all needed but that shows there is an awful anomaly between the public, private and voluntary spheres.

Mr. Tadhg Daly

Absolutely and that was the point of producing such a table so that the members of the Committee of Public Accounts could try to get to the bottom of this anomaly and inequity, through the value for money review and through their dealings with public bodies such as the HSE, the NTPF and the Comptroller and Auditor General.

As Mr. Daly said, the statistics show that people are living longer and we will need more private nursing homes. I know that private nursing homes are under pressure. When I am out canvassing, I go into them and I am told they are trying to keep the doors open and provide a service but it is getting harder. It tells its own story.

How does Mr. Daly think the fair deal scheme is working? It was a good idea when it was introduced by the then Minister for Health, Mary Harney, and everyone was delighted with it. How does he think it is working now from his perspective and the perspective of private nursing home providers?

Mr. Tadhg Daly

Clearly we are disappointed with the pricing element of it. From the residents' point of view the fair deal scheme is a good one as there is certainty around the availability of nursing home care and it means that people know in advance how much they have to contribute themselves based on their income and their assets.

From the point of view of operators and representative bodies, the pricing element is deeply flawed. The pricing review committed to dealing with and addressing that, but the delay in that regard is having a negative and very severe impact. As Deputy Aylward stated, it is becoming more difficult for people to keep the doors open because of the cost of operating, the dependency level of older people, the cost and complexity of care, the cost of regulation and commercial rates. Costs are only going one way while our members are trying to maintain value for money, to use Deputy Connolly's phrase. There comes a tipping point, however, at which operators will no longer be able to sustain viable services.

I wish to ask Mr. Daly about the agricultural sector, which is my background. Last year, we raised with the Irish Farmers Association, IFA, and other farmer representative bodies the issue of discrepancies which mitigate against agriculture and probably private business as well. I refer to the cap of three years or 7.5% on individuals which does not apply to members of the farming community. I would like to ascertain where Mr. Daly stands on that issue as a private supplier before I raise it with the next grouping to come before the committee.

Mr. Tadhg Daly

From our point of view, it is up to the resident to choose the nursing home in which they wish to reside under the fair deal scheme. We have engaged with the Minister of State, Deputy Jim Daly, and understand that an amendment to remove that provision, which the farming community regard as unfair, is with the Office of the Attorney General. That is a matter for Deputies and policymakers. I suggest that the definition of long-term residential care services, as mentioned by Deputy Cassells, should also be considered when amendments are being made to the scheme.

I wanted to get Mr. Daly's view on the issue before that stage is reached. He mentioned medical cards. Is he of the view that people lose their medical cards when they go into private nursing homes? I did not understand the point he made in his statement in that regard. If a person is entitled to a medical card and goes into a private nursing home, he or she does not lose the entitlement to that medical card. What point was Mr. Daly making in regard to medical cards?

Mr. Tadhg Daly

The very important point I was making was that when people cross the threshold of a private nursing home, they do not lose their entitlement to services but the availability of services is highly restricted. For example, the provision of occupational therapy or physiotherapy to a person in the community is given a higher priority. In regard to persons in a nursing home, we have letters on file from the HSE stating that it does not provide services-----

People do not lose the service because they are in a private nursing home.

Mr. Tadhg Daly

They do not lose the service but they do not receive it.

Why is that? If a person is entitled to a service while living at home and then goes into a nursing home, he or she is not longer entitled to the service. I did not know that. It is news to me.

Mr. Tadhg Daly

The point I am making is that it is discrimination against older people on the basis of where they reside. If they were living in their own home on the main street, they would continue to-----

Who decides that?

Mr. Tadhg Daly

Ultimately, the HSE.

A person in a nursing home deserves the same treatment as he or she would receive at home. Is Mr. Daly saying that because a person has enough money to pay to go into a private nursing home, he or she will lose those services?

Mr. Tadhg Daly

Yes. Our longer opening statement references a report published several years ago by the Health Information and Quality Authority, HIQA, on the provision of such services. Primarily, it highlighted the unavailability of primary care and General Medical Service, GMS, services because of long waiting lists. To be fair, the HSE undertook a quality and patient safety audit a number of years ago which also highlighted that in some respects there was a postcode lottery. It is back to funding. As Deputy Aylward stated, in the local authority, historically, if there was a range of services, it may have been provided, but we have, as I stated, numerous letters on file where it is not provided because the resident is in a private or voluntary nursing home and they are-----

Mr. Daly used the word "discrimination". It is discrimination.

Mr. Tadhg Daly

It is discrimination, absolutely. We have raised this issue with the Ombudsman and he has recently received some complaints in this regard. We also raised it several years ago with the Equality Authority because-----

What excuse does the HSE give if a patient looks for a service of which he or she availed while living at home? Is the reason given that the service cannot be provided because the person is resident in a nursing home?

Mr. Tadhg Daly

The reason given is not that the person is a resident of a nursing home but rather the unavailability of the service. The service is already stretched in providing care to others, so the HSE is not in a position to provide it to residents.

Is Mr. Daly saying that if a resident who has a medical card needs to see his or her GP but is in a remote nursing home, the GP will not make a 40 mile trip to see him or her and the resident is not capable of travelling to see the GP?

Mr. Tadhg Daly

Correct.

Nursing homes probably have an arrangement whereby a GP visits once a week or similar.

Residents must have access to GP services. Just because they go into a nursing home does not mean that they do not have access to GP services.

GPs will not travel to see patients who are now in a nursing home 20 miles away from them.

If a resident becomes ill in a nursing home, what GP attends them?

He or she is taken to an accident and emergency department.

Mr. Tadhg Daly

We work closely with GPs, who can argue for their own causes, and there is regular GP cover for residents.

If there are 100 people in a nursing home and 20 different GPs dealt with those residents before their admission, those GPs will not regularly attend the nursing home. Do nursing homes have an arrangement with a GP to provide a GP service?

Mr. Tadhg Daly

HIQA standards stipulate that residents have the choice to maintain their existing GP as the-----

Is that practical?

Mr. Tadhg Daly

It is hoped that that will be dealt with as part of the GMS contract. The issue is more about access to allied health services. I can revert to the committee and provide it with information and documentation in regard to physiotherapy, occupational therapy, speech and language therapy and specialised wheelchairs, for example, to which a person would ordinarily be entitled but which are more difficult to procure when the person is in residential care.

Contracts for care were mentioned by Mr. Daly. Old-age pensioners pay approximately 80% of their pension towards contracts for care. One may read in newspapers of issues regarding the 20% remaining being taken for extra services such as hairdressing. I am not making any accusations but there are question marks in regard to how that money is being used. The patients are old and some are senile. Who takes care of how that 20% is spent and what money is left over? Patients depend on someone within the system to look after that 20% of their money and to ensure that the services for which they are paying are being provided. I received a phone call from a journalist prior to the witnesses' appearance before the committee in regard to the misappropriation of moneys in some institutions such as those represented by Mr. Daly. I do not mean for my use of "misappropriation" to be taken up wrongly. I ask Mr. Daly to comment on obtaining value for money for the 20% that is left and how the money and the extras are dealt with.

Mr. Tadhg Daly

Ultimately, the money belongs to the resident. It is their money and they choose how to spend it. If they reside in a nursing home, a contract is agreed with the resident or their representative which sets out the fees based on the individualised care plan about which I spoke earlier, in terms of their will and preferences and requirements. It is all transparent and up front, but it is ultimately a feature of the scheme because the scheme excludes those services.

It is up to each private nursing home to provide those services.

Mr. Tadhg Daly

It is.

Who oversees that to ensure there is no wrongdoing in that regard? If there are moneys left over for savings, such as in the case of a person who wishes to save €20 per week, possibly towards burial costs, who oversees that and ensures it is being done and carried out properly and in accordance with the wishes of the patient, in particular those who do not have family members? If a resident has family members, the situation is different because the family members will visit the nursing home regularly and ensure the money is being spent correctly. If a resident has no family members, however, it is up to the nursing home to ensure that. I am seeking a general opinion on that issue.

Mr. Tadhg Daly

It is laid out in the regulations and standards. HIQA, as the independent regulator, oversees it.

Has Mr. Daly encountered any wrongdoing in that regard? Does that happen?

Mr. Tadhg Daly

Not as far as I am aware. There was one complaint to the Ombudsman in 2016 regarding charges for services and it was not upheld. It is important to point out that there is a complaints procedure if people want-----

There is a complaints procedure.

Mr. Tadhg Daly

Absolutely. It is important that people avail of that complaints procedure if they feel-----

I call Deputy Connolly because we must move on as there is a second group of witnesses to come before the committee.

I wish to clarify a few things. Mr. Daly is the CEO of Nursing Homes Ireland. Is that right?

Mr. Tadhg Daly

Correct.

Is that a paid position?

Mr. Tadhg Daly

It is, indeed.

Is Mr. Daly prepared to state his salary?

Mr. Tadhg Daly

Not here today, no.

Mr. Tadhg Daly

That is because we are a private organisation.

There is a board of directors. Is that right?

Mr. Tadhg Daly

Yes, there is a board of directors.

Mr. Tadhg Daly

No. The chairman is paid an honorarium but the directors are voluntary.

Is Mr. Daly prepared to say how much the chairman is paid?

Mr. Tadhg Daly

That is a matter for him, not me.

Mr. Maurice Pratt

I have no problem telling the Deputy what I am paid. I am paid €25,000 a year.

I ask because it is unusual to have representatives of a private body before us. The witnesses have talked a lot about transparency, openness and accountability, words we use here every week. I am asking them these questions in that context. There is a legal maxim and general saying that one comes to equity with clean hands. If one is demanding openness and accountability from an organisation, one needs to give them oneself.

Mr. Tadhg Daly

That is the point I am making, that there is no openness and transparency.

For one organisation, but we know precisely the salaries of everybody in the National Treatment Purchase Fund and the Health Service Executive. We had their representatives here today and it is all open and accountable. The witnesses' organisation is a for profit body. Is that right?

Mr. Tadhg Daly

No, it is not.

The representative body is not.

Mr. Tadhg Daly

No, it is not.

I understand that, but, by and large, nursing homes are run to make a profit.

Mr. Tadhg Daly

They are run to provide services for older people-----

And make a profit.

Mr. Tadhg Daly

-----to remain sustainable and able to reinvest in their services.

Let me reassure Mr. Daly, first, that 80% of the service is provided by private homes-----

Mr. Tadhg Daly

And voluntary services.

I understand we are reliant on them; therefore, let me praise them. It is not my preference, but my preference is not important. However, that is the reality. I would, however, prefer to see a ratio of 50:50. As somebody who collected 24,000 signatures to try to keep a public nursing home in Galway open, I am disappointed that the State has pulled out of the provision of nursing homes. Let me state my prejudices, as it were. I go back to the issue of openness and accountability. By and large, outside the voluntary homes, each home is run to make a profit. Is that right?

Mr. Tadhg Daly

Yes.

Therefore, the aim in providing a service is also to make a profit.

Mr. Tadhg Daly

The people who set up nursing homes do so to provide care for the older population.

Mr. Tadhg Daly

That is their function.

They are charities.

Mr. Tadhg Daly

Arguably, they are the most highly regulated across the health service.

Will Mr. Daly, please, listen to me? I can only ask questions for a little while.

Mr. Tadhg Daly

Fine.

They are not charities.

Mr. Tadhg Daly

Some of our members are.

Mr. Tadhg Daly

Approximately 20%.

I have two numbers for how many Nursing Homes Ireland represents.

Mr. Tadhg Daly

Some are not for profit.

How many homes does Nursing Homes Ireland represent?

Mr. Tadhg Daly

It represents 374.

What is the context? How many homes are there?

Mr. Tadhg Daly

There are 440.

The number is 440.

Mr. Tadhg Daly

It is 444 or 445. I do not know the exact number.

The 374 Nursing Homes Ireland represents all pay a membership fee.

Mr. Tadhg Daly

Correct.

For that privilege, Mr. Daly is the chief executive and on a salary, while Mr. Pratt is the chairperson. The witnesses do not have a very good opinion of the National Treatment Purchase Fund. Am I being fair or wrong in saying that?

Mr. Tadhg Daly

We have had very good engagement with it during the years. When the scheme was established, when it was going through the Houses of the Oireachtas in 2008 and 2009-----

Would Mr. Daly-----

Mr. Tadhg Daly

We understand it has a job to do, but we are concerned on two fronts. We are concerned about what we see as a take it or leave it approach. We are also concerned about the prevarication in publishing what, in essence, are terms of reference set by the Minister for Health and his Department. The delay in publishing the review is a source of serious concern.

I share those concerns and we will ask the questions. I have read it and an announcement was made. These are practical things on which we can agree. In view of his opening statement, Mr. Daly does not have very high regard for the National Treatment Purchase Fund, or does he?

Mr. Tadhg Daly

It has a role to play.

Does Mr. Daly hold it in high regard?

Mr. Tadhg Daly

I think it could improve significantly the way it does business. We hope the pricing review will enlighten and inform it and lead to a better standard of provision and a sustainable and viable sector.

And obviously more profit for that model in the provision of services.

Mr. Tadhg Daly

That is the Deputy's word. It is not necessarily about profit per se, but people make a profit. I do not think it is a dirty word, but it is important that the service being provided be sustainable. In the Deputy's own words, 80% of the service is being provided by the private sector. It is a key feature of the regulatory environment. In essence, all of our members provide a home from home for 50 or 60 people. We want to ensure the sustainability of that service.

We have had representatives of the National Treatment Purchase Fund and the Health Service Executive before us. In fairness, we give them a hard time, as is our duty, but we cannot subject nursing homes to the same scrutiny. They do not come within our remit because they are voluntary or private for-profit companies. There is an imbalance immediately. Is that right from the point of view of the committee?

Mr. Tadhg Daly

I do not understand the Deputy's question.

I have a little difficulty in that regard. When we go back to a certain meeting about which I will ask Mr. Daly, I am sure he will be happy to talk about it since we wrote to and invited the witnesses. At the time the date did not suit, although the witnesses were open to coming, but they participated in a meeting in October 2015, at which point many things were discussed, including a boycott of the National Treatment Purchase Fund and taking on patients under that system.

Mr. Tadhg Daly

In terms of-----

Will Mr. Daly, please, listen to my question because I will be stopped by the Chair? That meeting took place and Mr. Daly was at it. Was the issue of a boycott discussed?

Mr. Tadhg Daly

That meeting was the subject of an examination by the Competition and Consumer Protection Commission and it is a matter of public record that we reached agreement with it. It brought its inquiries to a close and there was no finding of an infringement by the organisations.

As I said, when we talk about openness and transparency, we do not spare the rod when representatives of public bodies come before us. At the meeting did Mr. Daly discuss the issue of a boycott, among other measures?

Mr. Tadhg Daly

At the meeting to which the Deputy refers a legally privileged document to which we have referred previously was discussed.

I am not referring to any note but to a meeting about which I have asked Mr. Daly who has confirmed that he was at it.

Mr. Tadhg Daly

I did not discuss the issue of a boycott, if that is what the Deputy is asking me.

Was it discussed at the meeting?

Mr. Tadhg Daly

I did not discuss the issue of a boycott at the meeting.

Will Mr. Daly, please, listen to my question? Was the issue of a boycott discussed?

Mr. Tadhg Daly

I am answering the question. I did not discuss the issue of a boycott.

Did Mr. Daly hear about the issue of a boycott being discussed?

Mr. Tadhg Daly

I did not discuss the issue of a boycott at the meeting.

If Mr. Daly is not prepared to discuss it, I will accept it.

Mr. Tadhg Daly

The Deputy is entitled to ask the question, but we engaged openly with the Competition and Consumer Protection Commission and entered into an agreement with it on 19 January. We have a copy if the Deputy wishes to see it.

I would love to see it in due course.

Mr. Tadhg Daly

It is on the public record.

For the moment because I have limited time and in the interests of transparency and accountability, I am asking Mr. Daly questions about the meeting. I started by asking him his opinion of the National Treatment Purchase Fund and then asked what was discussed at the meeting. I am not referring to any note because it is legal and confidential, but we were led to believe, by various sources, that many things had been discussed, including the issue of a boycott. Is that correct?

Mr. Tadhg Daly

I have already said dI did not discuss the issue of a boycott at the meeting.

What did Mr. Daly discuss?

Mr. Tadhg Daly

The fair deal scheme was discussed at the meeting.

What problems were highlighted and of what solutions did Mr. Daly think?

Mr. Tadhg Daly

Many problems were discussed. They were outlined in my opening statement and included the fact that there was inequity in the scheme, a threat to the sustainability and viability of the private sector and the implications for the future care of the older population.

What steps was Mr. Daly prepared to take because of his frustration and because he wanted-----

Mr. Tadhg Daly

I have mentioned already that we had leave for a judicial review in 2009. As an organisation, our duty is to represent our members. We have to consider all options for legal recourse to ensure we can adequately and appropriately represent our members.

We will come back to the issue of dependency in respect of the NTPF and the difference in prices. I thank the witnesses for all of the information provided. I have read it and taken particular note of the position in Galway. The Health Service Executive or the NTPF talked about the high levels of dependency on public hospitals, but the witnesses then said that was not accurate. Will Mr. Daly clarify why it is not accurate?

Mr. Tadhg Daly

There are two points, one of which is that all those approved for inclusion in the fair deal scheme undergo an assessment of their financial means and also a care needs assessment. All those approved are, in effect, highly dependent because they require residential care. That is one point.

I do not understand it. That is not my experience from talking to family members. I understand there are different levels of dependency and that some patients or residents have a much higher level of dependency than others. Some are confined to bed, others are not. Some need hoists, others do not.

Mr. Tadhg Daly

All those approved for inclusion in the fair deal scheme have been assessed as requiring long-term residential care.

They have not all been assessed as being highly dependent.

Mr. Tadhg Daly

Absolutely - high or maximum dependency.

Mr. Tadhg Daly

That is the purpose of the scheme - to ensure only those who require residential care receiving funding under it and that those who can manage on their own-----

Mr. Tadhg Daly

That is the reality.

-----we are getting tired and confused. Perhaps I am confused.

Not all people assessed under the fair deal are regarded as high dependency.

Mr. Tadhg Daly

High or maximum dependency.

That is what Mr. Daly is saying.

Mr. Tadhg Daly

Yes. Absolutely.

Mr. Tadhg Daly

There may be some social cases potentially, so people who would be admitted-----

No, we are not going off-----

Mr. Tadhg Daly

They would be a small number.

While I may be wrong I can clarify this later with the National Treatment Purchase Fund. Just to be clear, there are different levels of dependency.

Mr. Tadhg Daly

Absolutely.

Different people under those different levels qualify under the fair deal system. Not all of them are on the high level.

Mr. Tadhg Daly

What is undertaken is called a CSAR, a common summary assessment record. This is done by a multidisciplinary team of HSE professionals; it is not done by nursing homes-----

Mr. Tadhg Daly

----- or not done by us. It is done by the HSE. It determines that a person requires residential care.

Mr. Tadhg Daly

The average is now 83.

We are going off-----

Mr. Tadhg Daly

The average length of stay is reducing.

We are going off-----

Mr. Tadhg Daly

We are not going off the point.

We are going off on a tangent. We can disagree on it and I can clarify it later. Mr. Daly is actually saying that all patients who qualify under the fair deal are high dependency. Am I right?

Mr. Tadhg Daly

What I have said is that there may be some social cases. When the Deputy says "dependency", if she is talking about dementia for example, while a person might not require a hoist, for example, or be confined to bed in her own language, the fact that they have limited cognitive ability might mean they have other dependency, but to the naked eye it may not seem that they are highly dependent.

The other point I would make is that if the Deputy reads our opening statement in the report by the dementia services they made the point that curiously the higher fees are given to the HSE, whereas in fact the private sector would be the majority provider of dementia care, for example.

I see the issues and we will be raising some of those. I am just trying to clarify. Mr. Daly is clearly telling us that the homes he represents have the same level of high dependency as the public nursing homes.

Mr. Tadhg Daly

It is mixed across the system because-----

Mr. Daly should listen to my question. I want to be fair. He said - he can take it back and I can-----

Mr. Tadhg Daly

No.

The homes Mr. Daly represents have the same level of high dependency for residents as the public nursing homes have.

Mr. Tadhg Daly

And in some cases higher dependency.

Okay, that is very good.

Mr. Tadhg Daly

We are talking about 23,000 people funded under the fair deal. They are all people with differing needs and differing requirements.

I am fully aware of that. I looked at the Health Service Executive arguments, which claimed there was a high level of dependency for various reasons in the public nursing homes which was one of many reasons that led to higher prices. Another was that its public nursing homes function in a different way. For example, the public nursing home in Carraroe has other functions. It runs a day centre in Carraroe and has many other functions in the community which a private for-profit nursing home would not have. That was another issue raised by the HSE among other issues that lead to higher costs.

I remind the Deputy that representatives from the National Treatment Purchase Fund are to come yet.

I call Deputy Cullinane and ask him to be tight.

We are always tight when I am asked to come in.

We have kept the good wine till last.

I will get the same time as everyone else, I am sure.

They were all on ten minutes, bar one.

Absolutely.

The witnesses are all very welcome. In his opening statement Mr. Daly spoke about evidence of gross inequity in the budget as applied by the State in terms of the nursing home support scheme. I ask him to elaborate on that.

Mr. Tadhg Daly

If the Deputy looks at table 1, which is the appendix, that shows the inequity. There is one scheme which is a statutory scheme set out by the Oireachtas which is supposed to provide equity for the residents and for the providers of care. However, in effect, there is a much higher remuneration or fee payment to the public nursing homes than in the private and voluntary nursing homes.

However, they are public nursing homes; they are owned by the State. It is taxpayers' money.

Mr. Tadhg Daly

The fair deal is all taxpayers' money.

I know that, but the money that goes into public nursing homes goes into public nursing homes and not into private nursing homes.

Mr. Tadhg Daly

The point I am making is that the fair deal is blind to whether it is public or private. It is the resident who chooses. The resident is approved, having undergone an assessment of need for support under the nursing home support scheme and it is he or she who chooses which nursing home to live in.

Mr. Daly's opening statement was quite striking in its language. He said that the NTPF is abusing its dominance as a monopoly purchaser, which is quite strong language. Can Mr. Daly elaborate on that?

Mr. Tadhg Daly

It is a monopoly purchaser because there is only one purchaser.

Mr. Daly said it was abusing its dominance.

Mr. Tadhg Daly

We would argue that it is abusing its dominance because what it is doing based on the feedback from our members is that it is not taking account of the legitimate fee increases. I made the point in my opening statement that from October 2016 to February 2018 the cost of care in the public system had increased by 11%, cognisant of increased salaries, increased wages and increased costs of operations, whereas the corresponding increase provided by the NTPF on average was 3.9% in the private sector.

Mr. Daly obviously feels very aggrieved and concerned by that.

Mr. Tadhg Daly

I am concerned on a number of fronts - concerned ultimately for residents who are supported by the scheme, concerned for our providers, and concerned for the sustainability and viability of the sector given that we have an ageing population.

Obviously the members of Mr. Daly's organisation have the same concern.

Mr. Tadhg Daly

Absolutely.

One of the ways Nursing Homes Ireland articulates that is by organising meetings to discuss those concerns. I refer to the meeting Teachta Connolly mentioned on 23 October 2015. Mr. Daly is absolutely right in saying that the minutes of that meeting are subject to legal privilege because that was something that was exercised by Nursing Homes Ireland. I understand there were legal representatives representing the organisation at that meeting. Was that not the case?

Mr. Tadhg Daly

It was a legal note.

It was a legal note because they were at the meeting; they took notes.

Mr. Tadhg Daly

Yes.

As Mr. Daly knows that note was leaked and it was covered in most of the national newspapers. The word "boycott" was used in every publication. Three or four newspapers published the article. Mr. Daly was at the meeting. He was asked a question earlier by Teachta Connolly. He said he did not use the word "boycott". However, he was not asked whether he used it. He was asked whether the word "boycott" was used at the meeting. I am asking again: was the word "boycott" used at the meeting?

Mr. Tadhg Daly

I dealt with that matter earlier.

Mr. Daly has not dealt with it, because what he-----

Mr. Tadhg Daly

I said-----

No. Mr. Daly can choose not to answer questions; that is no problem. However, he cannot come in and try to pull the wool over people's eyes. If he wants to not answer questions, that is entirely his prerogative. However, in not answering questions and not being upfront, in my view, it causes concern for me. He knows perfectly well he was not asked whether he used the word "boycott" personally. He was asked whether somebody at the meeting used the word "boycott".

Mr. Tadhg Daly

I have dealt with it on a number of occasions. The Competition and Consumer Protection Commission has examined this matter. We have an agreement and undertaking with it. It found that there was no infringement by the organisation.

No matter how many times Mr. Daly trots out the line about the Competition and Consumer Protection Commission, it does not make any material difference to the question I put as to whether the word "boycott" was used. The Competition and Consumer Protection Commission would be investigating whether something actually happened. What is in the public domain that we know about from the leaked documents was that it did not happen because there was strong legal advice at the meeting that the organisation needed to stop there. One of the lines in it was that the discussion could give rise to a dawn raid by the Competition and Consumer Protection Commission and its members. Obviously the Competition and Consumer Protection Commission was not able find any adverse findings against Nursing Homes Ireland because it did not happen, but that does not mean there was not discussion on it. I have gone through all the articles in all the media coverage. There is no doubt that the legal opinion given at the meeting was that there was serious concern about being in breach of competition rules because of some of the language that was being used and the direction in which the meeting was going. Is that not right?

Mr. Tadhg Daly

As an organisation, we absolutely accept and understand our legal obligations. We co-operated fully with the CCPC, as we said already, and we have an agreement undertaken with it. That matter is closed.

The matter is not closed. The matter is only closed when everybody says it is closed. It might be closed for the Competition and Consumer Protection Commission, but it was not closed for the Committee of Public Accounts which dealt with this in the past. We have said we might come back to it. Therefore from our perspective it is not closed because Mr. Daly is not answering the questions today. He is perfectly entitled not to answer them, but he is not answering them. Therefore we do not know to this day whether the word "boycott" was used, other than what we see in the public domain in the media, where the leaked documents indicate it was.

Mr. Daly is saying that he did not say it, but he cannot say whether he heard it. He is refusing to answer that, which I think speaks volumes.

Mr. Tadhg Daly

I have said to the Deputy that we have an agreement with the Competition and Consumer Protection Commission, CCPC. It has concluded its inquiries.

Why was Mr. McEnery at the meeting?

Mr. Tadhg Daly

I was asked that question earlier by Deputy MacSharry. Mr. McEnery is head of healthcare with BDO. He advises many people in the healthcare space. He has spoken at some of our conferences. He was there in an advisory capacity as a financial advisor.

That is not what he said when he was before the Committee of Public Accounts. Does Mr. Daly know that Mr. McEnery was before us?

Mr. Tadhg Daly

I do.

Does Mr. Daly know that Mr. McEnery said he had a serious issue with some of the language that was used in the minutes of the meeting, and that he was going to challenge them through his legal representatives?

Mr. Tadhg Daly

That is a matter for Mr. McEnery.

I know it is a matter for him. Mr. Daly is obviously being very defensive and that is fine.

Mr. Tadhg Daly

I am being fully open with the Deputy. We have an agreement with the CCPC, which I have referred to. I am happy to give the Deputy a copy of that.

If Mr. Daly characterises his answers to questions as "fully open" then I think we have an even bigger problem, because he is being anything but fully open. Many people appear before committees and for legal or other reasons decide not to answer questions. They are under no obligation. However, in doing that the witness does not get to say he is being fully open. Mr. Daly has been asked straight questions which he has not been able to answer.

Mr. Tadhg Daly

We were in contact with the chairman around that time. The document the Deputy refers to is a legally privileged document.

That is my point. Mr. Daly is still free to answer questions. He is still free, if he wishes, to clarify for the public on behalf of his organisation whether or not the word "boycott" was used at that meeting.

Just to clarify, we were told that the document we got was legally privileged. Every discussion that has arisen at this committee was based on the reports published in the national media, which might have been quite similar to the document that was circulated. We anchored none of our discussions on the document that we were told was legally privileged. I must be quite clear on that. We anchored all of our discussion on what was in the national media, which might or might not have come from the same source. It probably did. However, we did not use that privileged document here.

My point is that the document itself may be privileged, but the discussion at the meeting itself is not. The document is subject to it. The witness is quite free, if he wishes, to answer questions about what he heard or did not hear at the meeting. I am not asking him what was in a document as that is subject to privilege. I am asking him, as somebody who heads an organisation, whether or not the word "boycott" was used at a meeting of his organisation. I will ask him again. Not referencing any document, but as somebody who was at the meeting, did Mr. Daly hear anybody use the word "boycott"?

Mr. Tadhg Daly

I did not use the word "boycott".

Did Mr. Daly hear anybody use the word "boycott"?

Mr. Tadhg Daly

I have answered the question. I am happy to say that I did not use the word "boycott".

Did Mr. Daly hear anybody say it? Does he hear the question I am putting to him? If I asked him whether he used the word "boycott", then a reasonable response would be to say that he did not use the word "boycott". If I ask him whether anybody used the word "boycott", or whether he heard anybody use the word "boycott", then repeating that he did not say it is not a reasonable response. I am asking again. Did anybody use the word "boycott"?

Mr. Tadhg Daly

I have answered the question as far as I am concerned.

As far as the witness is concerned, he has given a response, but he has not answered the question. With respect, somebody cannot say he or she has answered a question when he or she clearly has not. I am asking for some direction from the Chair. If Mr. Daly is prepared to say that he simply cannot answer that question or he is not prepared to answer it, I will accept that. However, I will not accept that he has answered the question. If he is going to-----

He is here in a voluntary capacity.

I am in no position to force an answer from anybody. However, if the witness believes he has answered and everybody on one side of the table does not believe that, we have a different opinion on it. I cannot force words out of anybody's mouth.

Absolutely not. I am not trying to force words out of somebody's mouth. I am saying that one cannot-----

Deputy Cullinane can reject his answer.

With respect to Mr. Daly, that is not what I am saying. I am saying that if a witness is asked a direct question and he does not answer it, he cannot say that he has answered the question and has been upfront. Clearly he has not been. That is the point I am making. We have established that.

We are going to have to move on.

I have one final question. Mr. McEnery had a different view as to why he was at the meeting. His organisation represented 20 nursing homes. He would have been aware of the fees that they receive. He is also the chair of the Health Information and Quality Authority, HIQA, is he not?

Mr. Tadhg Daly

These are in the public domain.

Is he chair of HIQA?

Mr. Tadhg Daly

Not any longer as I understand it, but-----

He was at the time.

Mr. Tadhg Daly

At the time he was, yes. However, he was not invited in his capacity as chairperson-----

I know he was not invited in his capacity-----

Mr. Tadhg Daly

All the fees are published. The Deputy can go on to the website this evening and see all the fees of all nursing homes across the country.

Here is the problem for Mr. Daly. This was a meeting that was discussing pricing. The word "boycott" was used, or at least that is what we were told. I refer to Mr. Paul Rochford. The media reports that the threat of not taking in new admissions from the acute hospitals is a potentially very powerful lobbying tool, that as a lobbying group the biggest threat Nursing Homes Ireland, NHI, and its members have is ceasing admissions and new beds. The word "boycott" was used and the word "lobbying" was used several times. Legal figures advised against going down this route and that it could give rise to a dawn raid by the CCPC. Given that he was chair of HIQA, for Mr. McEnery to be at a meeting where the discussion was going that way was problematic for Mr. Daly.

I will finish on this, because I will not get any response from Mr. Daly. Mr. Daly has raised more concerns for the Committee of Public Accounts today than he has dealt with questions. I note instances where a witness appears before the committee, even in a voluntary capacity, and they do not answer questions. There is a very real public interest in this issue. The content of this meeting has been reported in the media several times, and Mr. Daly had an opportunity today to clear up some issues. He could have said that the word "boycott" was not used, if indeed it was not. That would have cleared that up. However, he is not in a position to do so, which I think speaks volumes. I think we will have to come back to it at some point.

I want to conclude because of the late hour. I apologise for the late start, and for delay faced by the next witnesses. I am bringing this section of today's proceedings to a conclusion. I want to thank the witnesses for coming in voluntarily as a private organisation not within the remit of the Committee of Public Accounts. I thank them for all the information that they provided. It will be of assistance to us in our discussions with the National Treatment Purchase Fund.

Sitting suspended at 4.37 p.m. and resumed at 4.40 p.m.
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