I thank the Chairman. It is a pleasure for me to meet the committee again to talk about the priorities in health care reform. It is useful for the Minister for Health and Children to engage with the committee on several occasions each year. I very much welcome this opportunity to speak to the committee which is not focused on a Bill but on the general health agenda.
My priority and that of the Government is to see through the health reform programme. We have trebled spending on health between 1997 and 2005 but that increased spending does not deliver the results most people expect in the absence of appropriate reforms. Therefore, in future we must match increased investment with reform. As part of that agenda, we passed a Health Act last year which radically changes the way we deliver health services in Ireland. We have moved from a regional delivery structure to a unified structure. The Health Service Executive is a single national body responsible for the delivery of health care. It became fully operational in terms of its mandate in the middle of June this year.
The HSE has just completed recruitment of its key management team and the personnel who will take responsibility for its various aspects. Accountability for funding has moved from the Department of Health and Children to the HSE, a move on which I was very keen. That was recommended as part of the reform process, but those who spend the money must be accountable to the Oireachtas for the manner in which it is spent. It is not possible to achieve good, effective outcomes if one set of individuals accounts for the money and another for the delivery of services.
This was the biggest change in management process ever undertaken here in either the public or private sector. As with any reform, major transitional issues will arise as we seek to turn around a massive organisation. In terms of health care the organisation employs almost 100,000 people directly and if one includes the providers of health care in the voluntary and independent sector, it amounts to many more.
Notwithstanding the transitional difficulties and challenges, the HSE is in good shape as autumn approaches to fulfil the mandate the Oireachtas expects of it in the legislation. During our debate on the Act committee members were interested in several issues, particularly accountability to the Oireachtas, Members of the Dáil and Seanad and this committee and I gave an undertaking to bring forward regulations to that effect. The regulations have been drafted and will soon be in effect.
When the autumn Oireachtas session begins, there will be 45 people in the HSE parliamentary affairs division which will comprise a national central division and regional divisions. The HSE will hold a briefing session in September for Members of the Oireachtas about its parliamentary affairs division and will give each Member details of the individuals responsible for various services in order that Members can engage meaningfully with it. That is important. I have made clear to the acting CEO that to be able to respond rapidly to queries of Members of the Oireachtas on behalf of patients who are constituents will be an important performance indicator for the Health Service Executive.
Second, we want to put in place the regional forum, for which I have approved the regulations. I am required in the Act to consult with the Minister for the Environment, Heritage and Local Government and that consultation is under way. I hope the regulations can be signed into law this month or in August — certainly by autumn of this year.
The third area about which concern was expressed was the complaints procedure. A number of seminars have taken place with various stakeholders, patient groups, service providers and others regarding an appropriate complaints mechanism. When they are being concluded those regulations will be brought into effect.
The major challenge to the delivery of health care is a speedy response to the needs of patients. The acute hospital system, between outpatient appointments, accident and emergency services and inpatient activity, accounts for 2.2 million patients per year. This amounts to considerable activity and it is becoming more complex. The population is aging and there are increasing demands, particularly from those in the older age bracket. The challenges of ensuring we have capacity to meet the needs of our growing population is immense. We must also ensure that when we have capacity in place we use it as efficiently and effectively as possible. That is why during these months, an audit is taking place of ten major hospitals in the first instance.
The purpose of the audit is to establish what the practices are with a view to achieving best practice to resolve difficulties and to make sure the hospitals operate as efficiently and effectively as possible. I want to see our acute hospital system benchmarked against best international practice. Unless we have some baseline data, we will not be able to achieve this. That is under way. In terms of discharge policies, outpatient and inpatient activity, day case activity and so on, it is clear that the skill mix in hospital and other care settings is very much dependent on having good base data and benchmarking against best international practice.
Busy accident and emergency departments remain a challenge, particularly in the Dublin area but not exclusively so, where two main difficulties present. On the north side of the city we have two doctors at night between 6 p.m. and 8 a.m. or 9 a.m. and at weekends to cater for 500,000 people. That is not adequate or satisfactory. We have not been able to resolve the issues with the GPs in the traditional way as we have done in other parts of the country. I have discussed this with Professor Drumm and the head of the primary care division in the HSE, Aidan Browne. Since the traditional route is not producing results, the intention is to go to tender shortly for out of hours services on the north side of Dublin.
Many of those present are familiar with out of hours services in other parts of the country. I recently visited the facility in Carlow which caters for 500,000 patients. It is a fantastic facility and operates very effectively. I see no reason we cannot have a similar facility operating in the Dublin area. That is one of the difficulties that has to be resolved very quickly and since the traditional route has not proved capable of resolving it we have to find alternatives. That process is now under way but until it is resolved it will add to the difficulties in accident and emergency departments.
The second issue adding to difficulties in accident and emergency services is the matter of care of the elderly. The controversy and difficulties in regard to the charges issue has posed problems for the acute hospital system. Currently in the major Dublin hospitals we have over 400 late discharges. Many of these are being assessed for home care packages. It is my and many others' preference to keep as many as possible in a home environment. An innovative home care package has been introduced very much tailored to the needs of the patient rather than a fixed and prescriptive set of rules in which one hopes patients will fit. The individual patient's requirements are examined and a home care package is tailored around his or her needs. It is expensive but appropriate.
The Minister for Social and Family Affairs and I put together a group of officials to examine home care packages for the elderly. The group is due to report to us later this month on all options for care of the elderly. It has been a mismatch with much confusion over the many different factors applying in different places. Home care will be a strong feature of our policy. Several packages have been put in place. There are approximately 500 packages and it is to be hoped that there will be more.
We have acquired some step-down and high dependency beds in the private sector. More than 100 patients have used the step-down facilities which were acquired through a public procurement process and patients are being moved to the high dependency beds. Some younger disabled people fall into the category of late discharges. However, in the main they are elderly people and the provision of appropriate facilities for them is a priority. When it is resolved it will ease the pressures on the acute hospital system.
Various recommendations have been made in the area of bed capacity to achieve the extra 3,000 beds by the end of the decade. Some 900 of these will be in place by the end of the year. Between 400 and 500 are planned as part of the capital programme over the next several years. However, there is still a shortfall. Last week I announced it is intended to provide up to 1,000 of those beds by decanting 1,000 private beds in public hospitals into private facilities on public hospital grounds. Some 2,500 beds of the 12,900 beds in the acute hospital system in public hospitals are private beds. These private beds can be provided through alternative means. It is the quickest and most effective way of providing more public beds for public patients. There is significant interest in this from many hospitals. I have already received a proposal from one hospital which was well-thought out and I know several other hospitals are interested in pursuing this particular matter in this way.
I have seen speculation in the media about the costs of these beds. To provide a public bed costs approximately €500,000. To provide 1,000 beds, therefore, would cost €500 million. Staffing those beds would cost €345 million per year. This is based on the average costs in the acute hospital system. To provide these beds using capital allowances, at the highest level, would cost €220 million if all the investment was done through equity. The cost depends on the tax point of view on the debt-equity ratio. In the guidelines I have sent to the Health Service Executive which were drawn up by Prospectus which has much expertise in this area, the executive is required, before it gives approval to any public hospital to pursue this policy, to assess the private capacity in the area. It is also required to examine the cost to the Exchequer of providing the beds in this way by examining the debt-equity ratio.
Even if all the money was to be invested by way of equity and, therefore, the full capital allowances applied, these beds would cost at most €220 million as opposed to €500 million through the traditional way. It is estimated we need €25 million annually worth of consultants. Obviously when the beds are freed up in the public hospitals, the insurance companies pay the acute hospital system approximately €220 million per annum. Moving these beds would cost the public hospital system approximately €145 million per annum. We are moving to full economic cost for private beds in public hospitals, which every party supports. The insurers pay 60% of the costs of these beds which will cover the costs of decanting the beds. Therefore, there will be no additional cost to the insurers over and above what they will have to pay under the policy adopted by the Government several years ago.
The primary care strategy envisages spending €1 billion on primary care centres nationwide over several years. It is difficult to see how we could make that money available using the traditional method. There are a number of innovative projects, including one in Killarney where all the GPs have come together and put forward an innovative proposal, of which I am supportive. The Department is making advances with that group and others regarding the provision of primary care facilities at local level. Clearly, a growing number of our health requirements must be met at primary care level. For example, one of the big challenges facing health ministries worldwide is managing chronic illness in the community, whether it be diabetes, heart disease of whatever else. This is best suited to be done at primary care level.
We will soon open negotiations on the GMS contract with the IMO which I look forward to being completed as quickly as possible. In the meantime, the outstanding issues regarding Sustaining Progress have been resolved and the doctor-only medical cards which I announced last autumn are now being issued. In addition to issuing the cards we have changed the manner in which people's means will be calculated. Instead of the traditional way of looking at one's gross income, whereby one had to pay the first €26 per week towards one's mortgage or rent, €23 towards one's transport to work and so on, we will allow all reasonable expenses for mortgage or rent, child care and travel to work. In effect that means we are taking into account a person's net income, a much fairer way to allocate both the traditional medical card and the new doctor-only card.
The legislation to deal with illegal nursing home charges went through the Oireachtas and charges have been back in place since 14 July. Regarding waiting time for procedures, we established the national treatment purchase fund a number of years ago and to date it has treated more than 30,000 patients mainly in the private health care system in Ireland. We have some difficulties in getting referrals to the national treatment purchase fund and instead of waiting lists for procedures, we are moving to a patient register. That will be in place in some parts of the country later this year. In effect, the patient will get a card telling him or her that after three months waiting, he or she can contact the national treatment purchase fund and have the treatment provided. The fund will also have the patient data and will be able to write directly to the patient to outline the treatment it can offer in the patient's circumstances. This is a way of empowering patients.
I have also asked the national treatment purchase fund to look at outpatient waiting lists on a pilot basis as there are considerable delays in many key areas where there is a shortage of consultants. The national treatment purchase fund is looking at 5,000 patients on a pilot project basis and will report to me later this year. Essentially, the fund relates to surgical or procedure-based medicine, which is a new area for it, but I asked the members to do some pilot work in this area to see if there is a role for the fund in clearing waiting lists there also.
As everyone knows, the Government agreed in 2000 to establish an inquiry into organ retention. Unfortunately, the report was not ready for publication by 31 March last, the deadline given. The Government has appointed Dr. Deirdre Madden, a lawyer and scientist, to take forward the work, and she has agreed to report by 21 December. I met her recently and she is determined to meet that deadline. That is important because this inquiry in Northern Ireland and Britain was done in an 18-month timeframe. The inquiry to date has cost about €21 million, a considerable amount of money.
A major priority for all of us is the issue of disability. As everyone knows, we have moved to multi-annual funding, an appropriate way for the disability sector to be able to make plans with regard to its services. Funding is now guaranteed for five year periods hence, which is important.
I know people will ask me many questions about different matters and I will be delighted to answer them. The issues of hospital cleanliness, hygiene, MRSA and so on are a priority for me and for the HSE. Currently a hygiene audit of every hospital is being conducted. Like the other audit of practice and procedure, it is being done with a view to establishing the situation in each place. The results will be published, not to name and shame, but the public has a right to know the hygiene standards in various hospitals. The idea is to work with individual hospitals to bring them up to an acceptable standard. It is a fact that hospitals are not places where any of us should be unless we have to be there. However, we must ensure they operate to the highest possible standard.
I see that in our neighbouring jurisdiction the Prime Minister, in the course of the recent election, set a target of halving the rate of MRSA in Britain by 2009. Some might say that is not very ambitious, but it indicates how difficult it is to achieve. In addition to basic hygiene and operation to high standards, there are other important issues such as bed occupancy and isolation rooms. In the ideal hospital, everyone would have a single room. I recently met microbiologists who said that in future everyone would be in a single room, the only real way that one can maximise infection control and minimise the possibility of people contracting infections. We are a long way from that in Ireland and across Europe.
We know the cost implications of moving in that direction. Within the resources we have and the current hospital structure, we must ensure we operate to the highest possible standard. I am especially anxious, as is Pat McLoughlin of the National Hospitals Office, to ensure a senior clinician in every hospital will have responsibility for infection control and hygiene and that it is not a matter for the cleaning staff or someone from the HSE. A clinician should have overall responsibility for the area. I understand from other countries' experience that one achieves the best performance that way.
It is a privilege to appear before the committee and I am sure there are many areas about which members would like to ask with which I have not dealt. I would be delighted to take whatever questions they have.