In the time which I have left to me I propose to refer to the financial position. Although I dealt with the financial position in my contribution to the December debate on the Adjournment, it is worthwhile underlining some of the salient features in order that Deputies will be clear about the financial background which must affect the planning and operation of the health services in the current year. The non-capital allocation represents the major portion of the overall resources provided for the health services in the current year and I will deal in the first instance with the non-capital provision and its implications.
The net non-capital provision in the Book of Estimates for Health is £963.612 million. This compares with an out-turn figure of £936.7 million for 1983. The Estimates provision for health services will enable a sum in the region of about £1,062 million to be spent on health services in 1984 when account is taken of Appropriations-in-Aid. This represents an increase of £29 million on the 1983 out-turn of expenditure.
Regarding private and semi-private accommodation in public hospitals, charges have been increased by 25 per cent as from 1 January 1984. Details of the revised charges have been published. The revised charges are still substantially less than the average actual cost. For example, the revised charge for private accommodation is £69 a day in a teaching hospital. The average actual cost will be about £120 a day and will reach about £135 a day in the case of major large teaching hospitals. Voluntary Health Insurance members will be fully indemnified against the increased charges.
A hospital admission charge of £100 is to be made in the case of persons who have not discharged their liabilities in respect of health contributions. Regulations in this regard are at present being drawn up.
The threshold for the refund of drugs scheme has been increased from £23 to £28 with effect from 1 January 1984. The amount to be refunded in respect of January 1984, and subsequent months, will thus be expenditure in excess of £28.
I would like to avail of this opportunity to record my appreciation of the efforts of health boards, voluntary hospitals and homes in successfully coping with their 1983 budgetary situation. It is generally accepted that there were no major problems in 1983. There was no need for a Supplementary Estimate. Furthermore, I found it possible to make the required savings of £13.6 million in the Estimate without reducing the 1983 allocations of health agencies. The satisfactory out-turn in 1983 helps to cope with the 1984 situation.
The health agencies are at present considering the measures to be taken to avoid exceeding the non-capital allocations for 1984 which were notified to them last December.
I will not in any way pretend that serious problems will not arise, involving difficult decisions, in securing the necessary cuts in expenditure. All health boards have already met to consider their position and I am heartened by the fact that a number of boards have already adopted a range of proposals aimed at aligning expenditure with the allocation levels approved. I would urge all other boards to give priority attention to the budgetary situation. I would stress that there will be no extra funds at my disposal in 1983-84 that would enable me to ease the position for any health board or other health agency. It is essential, therefore, that decisions are taken without delay as to how the budgetary situation is to be dealt with at board level. The longer the delay the more difficult the problems become.
I have no illusions about the magnitude of the task facing health agencies. I am confident, however, that the various health bodies will deal with the situation in a responsible manner. Officers of my Department will be available to discuss difficulties arising. I met the Chairmen and chief executive officers in December last, for a preliminary discussion of the financial constraints. I will be reviewing the position in the light of reports from the health boards on the measures they propose to take to operate within allocations and the implications of such measures.
Much emphasis has been placed on the magnitude of increases in expenditure on health services in the last decade or so. In 1972-73 net non-capital expenditure on health services amounted to £108 million representing 4.7 per cent of GNP. In 1983 expenditure reached £1,033 million representing just under 8 per cent of GNP. It is noteworthy, however, that expenditure on health services has fallen in real terms since 1981. The situation as regards the provision of resources for health services is not likely to show any dramatic improvement in the medium term. Consequently, there is an urgent need to consider ways and means of securing necessary improvements in services in the context of continuing limitations on resources.
It will be of primary importance in future to ensure that expenditure on the health services is used in the most cost effective way possible. My Department are already taking steps to see that value for money is obtained across a broad range of services. For example, a number of studies were carried out last year on supplies, energy, transport and housekeeping and the recommendations for improved practices set out in those reports have been circulated to the health agencies. Other services, for example, patient admission procedures in general hospitals, are now being examined to ensure that they are being delivered in an efficient and effective manner and this process will continue. Also, new financial and non-financial systems which are being implemented in health boards and hospitals will be of immense value to both local and departmental management. The management information that will be produced by those systems, for example in the costing area, will improve the quality of analysis and decision making by managers. In general, it is fair to say that the rapid growth in expenditure in the past decade on the health services has meant that there is room for greater economies and better use of resources. The studies I have mentioned, the critical evaluation of services, the new management systems being introduced throughout health boards and hospitals, all of these developments can only assist the Department and its agencies in delivering the services in an efficient way so that value for money is got for every pound spent on the health services.
On the pay side of the health services I should mention that the allocation for the current year represents a 2¾ per cent reduction below 1983 pay volume. I fully appreciate the efforts made by the health boards and other health agencies over the past two to three years to cope with the financial restraints which had to be imposed because of the economic circumstances in which the country finds itself. I am heartened and encouraged by the continuing search for economies and improvement in efficiency and effectiveness which have enabled us to absorb these financial restraints without endangering the fabric of our health services. For the time being I am afraid we must continue in our search for the ways and means to survive and keep intact the vital and essential elements of our services. Given the good will and co-operation of all concerned I have no doubt that the very valuable and worthwhile services which have been built up can be maintained, perhaps even in a more healthy state than they were before. To facilitate the health boards and agencies in their task I am prepared to leave them relatively free to determine the measures they need to take to ensure that they will keep within their allocation. This flexibility would also apply to the question of filling or non-filling of vacancies which may arise. It will therefore be essentially a matter for each health board or agency to determine in the light of their own requirements. Through careful and prudent management of their resources I am sure they can get through what is without question a difficult and testing time though at the same time a challenging one.
I am concerned to ensure that the Voluntary Health Insurance play their part in controlling health care costs. To this end, I have asked the board to examine, for example, ways in which the use of out-patient facilities might be positively encouraged as part of their schemes as an alternative to costly hospital in-patient treatment. The board have also been asked to review their schemes generally in an effort to promote the use of the most efficient treatment procedures available.
I might add that the most recent report of the VHI board showed the board's schemes to be still attractive to a significant proportion of the population and despite the general economic difficulties the VHI's membership has remained buoyant. Indeed, the total number now covered by the board's schemes is over one million persons.
I should also say in this context that the board have raised with me the problems which can be created for them by a situation in which the development of private hospital facilities is not statutorily controlled. At present, there is no statutory control covering the establishment of private hospitals except where such private hospitals are intended to cater for the mentally ill or maternity patients in which case such hospitals are subject to the Mental Treatment Acts and the Registration of Maternity Homes Act, 1934. In effect, therefore, other than in respect of hospitals catering for the mentally ill or maternity patients, anyone may establish a private hospital providing a range of services from general medicine to cardiac surgery without seeking any permission from anyone to do so.
In the case of homes for incapacitated persons, nursing homes, certain standards are laid down in the Homes for Incapacitated Persons Regulations, 1966, made under the Health (Homes for Incapacitated Persons) Act 1964. Yet the only requirement laid down under the 1964 Act is that where a person proposes to establish a home, he shall, not less than one month before the date on which it is proposed to commence business, notify in writing the health authority in whose functional area the home will be situated of the name and address of the home and the name of the person in charge of the home.
The majority of voluntary hospitals, with the exception of hospitals which are administered by corporate bodies established under the Health (Corporate Bodies) Act, 1961, are in effect private hospitals operating under charters or private Acts. In reality, therefore, at present, there is little statutory control over the establishment and operation of hospitals or nursing homes here other than those hospitals owned and administered by health boards and statutory bodies. If unchecked this could lead to chaos in the organisation of hospital services generally. I am therefore at the moment preparing a submission to Government in which I propose to suggest measures to remedy a gap in the controls available to my Department to secure the most efficient use of resources.
I devoted a considerable portion of the contribution I made on the Adjournment Debate on 16 December last to my endeavours to systematically streamline institutional services with the twin objectives of eliminating wasteful use of scarce resources and of ensuring the continuation of vital services and the development by re-allocation of resources of facilities which it is absolutely essential to provide. While I have in the past year been involved in a number of closures of hospitals, for example Teach Ultain, Mercer's Hospital, Bantry, Trim and Dungarvan maternity units, I have at the same time provided for the expansion of cardiac surgery services at the Mater Hospital, of the establishment of a bone marrow transplant service at St. James's Hospital and the expansion of the renal dialysis services throughout the country.
I will continue with my efforts to streamline the services weeding out those services and facilities which are identified as patently unnecessary to the provision of an effective service.
This year the Department of Health's capital allocation will be £55.5 million compared with £53 million in 1983. This increased allocation will facilitate the continuation of an extensive building programme of hospitals and a wide variety of other health care facilities in various locations throughout the country. The capital development works in the health area this year are being carried through as an integral part of a medium term — five years — health capital programme. It is perfectly clear from the exhaustive review which I have carried out that the capital investment programme of our health services must have regard not alone to the likely future availability of capital funds from the Exchequer to plan and build essential facilities but equally must have regard to the additional revenue expenditure implications of new capital development which in the labour-intensive health sector can be particularly daunting. Against this background it is imperative that a scale of priorities be identified so that increasingly scarce resources can be applied to those areas of the service in greatest need. I am acutely aware that such a process must, of necessity, involve a number of difficult decisions for me and my Department as we can never hope to meet all the demands, both rational and irrational, which are daily made upon us. Unlike some of my predecessors, however, I am prepared to take up the challenge so that an attitude of pleasing all regardless of cost can be replaced by an honest, measured and coherent strategy of defining real priority needs and meeting those within a reasonable time frame. It will be necessary to reduce the scale of some developments particularly those in the general hospital area where past planning and inflated expectations must be brought into line with present and future reality.
The capital allocation for 1984 will, on the general hospital side, allow for ongoing planning and/or construction of major new facilities in the different health board areas. These include the six major hospitals for the Dublin area — St. James's, Beaumont, Mater, James Connolly, St. Vincents and Tallaght, including Naas — which will enable the replacement of a number of patently unsuitable hospital buildings dating from the middle of the last century. Outside of Dublin funds will continue to be allocated for planned new development in Castlebar, Mullingar, Ardkeen, Sligo, Wexford, Cavan and the completion of new hospitals in Tralee and Letterkenny.
I should say, particularly, that I am seeking to have the restriction upon the building of Cavan Hospital imposed by the taking of legal action by the Monaghan Hospital Retention Committee discharged by the High Court, and on the assumption that my efforts will be successful I have provided in the capital programme the money necessary to enable building to commence at the earliest possible date this year. I am concerned to do so because I know that it is imperative that the existing surgical hospital in Cavan should be replaced at the earliest possible date. In fact when I assumed office a year ago it was clearly identified to me as a project of the highest priority and I had provided for a commencement of building on the replacement hospital in last year's capital allocation.
The allocation will provide for the continuation of the special improvement schemes within our public psychiatric hospitals, the provision of new facilities for the mentally ill and the mentally handicapped as well as the development of improved services for the physically handicapped including up-dated centres for the deaf and the blind. A special emphasis will also be placed on the development and upgrading of geriatric hospitals and facilities throughout the country, e.g., St. Oliver Plunkett Hospital, Dundalk, and the Sacred Heart Home, Carlow.
In general, it will be my aim to continue the process of diverting an increasing share of the available resources into the low profile areas of priority need within the services, particularly in the community area. It is my intention to set aside a disparate allocation annually within the lifetime of the medium term capital programme to enable health boards to provide compact basic community care facilities which can be provided quickly and which will improve the effectiveness of the delivery of services within the community.
In the past I have stressed the extent to which I am committed to the strengthening and expansion of community care. In asking health boards to consider the manner in which they could live within their allocations in the current year, I put it to them that they should aim especially to safeguard the existing community care services and to try to avoid, as far as possible, making reductions in those services. I shall be examining, with particular care, when I receive their reports on their proposals for living within their allocations, the extent to which the health boards have found it possible to meet this requirement. It is particularly important, in the current year, that they should make the maximum possible effort to do so since, to the extent to which health boards succeed in limiting admissions to hospital, operating day hospitals or providing five-day week hospital care, a further burden will be placed on the existing community services. This is likely to be particularly true of the public health nursing services and the general practitioner services.
I would hope that in the current year general practitioners will co-operate to the maximum possible extent in reducing the numbers of referrals to hospitals. The constant increase in the number of hospital admissions has been a source of considerable concern over the past few years and I would appeal to general practitioners to ensure as far as possible that only those persons who cannot appropriately be treated in the community are referred for investigation and treatment in our general hospitals.
I would like to say also that I appreciate the extent to which the changes in nursing services which it will be necessary to make in the coming year will impact on the existing public health nursing services. These services provide, throughout the country, a high-class nursing service, which, particularly for the elderly, enables people to be maintained in their own homes where, in the absence of such services, it would be necessary to have them referred for institutional care. I know the burden that this imposes on the public health nursing staff and I would like to pay tribute to the extent to which they discharge these practical nursing duties in addition to their preventive role which is of so much importance, particularly in relation to the health and development of children.
We will, in the current year, clearly have to give a great deal more thought to the appropriate mix of services between the community and the hospital services. Of their nature the hospital services tend to be very expensive and while it would be a mistake to consider that, in all cases, an appropriate level of community care will necessarily be cheaper to provide, it is obviously desirable that we try to ensure that only those who require the high level of expertise and the technological facilities available in our general hospitals are admitted to them for care. This imposes on us the need critically to examine all the services we are providing within the community in order to establish how effective these are, how they might be improved and how they can be altered to provide a more effective and efficient health service in general.
Some of this work is currently being undertaken, particularly in the review body on the General Medical Services. This body who have representatives of the medical organisations and the relevant Government Departments are currently meeting frequently and reviewing the nature of the general practitioner services which might be provided in future, the manner in which these would be organised and the way in which these might be structured to assist in providing an effective foundation for an expanded system of primary health care. I would hope that, if the current rate of progress is maintained, the working party will be in a position to finalise their report before Easter.
As Deputies will know, there has, in recent years been a growing tendency to treat mentally ill patients to the maximum possible extent in the community. A review of services for the mentally ill has been in progress for some time and it involves representatives of all those involved in the provision of services. I would hope in the near future that this review will also be completed and that it will indicate the practical arrangements which may be necessary to make available effective community care for those who may suffer from mental illness.
In the past it was the practice that students and other young persons over the age of 16 years qualified for medical cards on the basis of their own personal income and without reference to their parents' financial circumstances. The result was that the great majority of students aged 16 years or over were automatically eligible for medical cards. Many of these students belong to families for which the payment of fees for normal family doctor and pharmacy services causes no hardship. Since eligibility for medical cards arises from hardship in paying for these services, the special position of students was an anomaly.
The Government decided to remove this anomaly by taking account of family circumstances in determining students' eligibility. The position now is that eligibility for medical cards will no longer be automatic but will be related to ability to pay for general practitioner services. Any student who is a dependent in a family with medical card eligibility will retain entitlement to a medical card.
