Boom to bust: its impact on Irish health policy and health services

Sara Burke^*

Smaller budgets, less staff, fewer hospital beds, doing more with less, ‘reform’ without actual reform, increased privatisation of healthcare are the themes that run through any analysis of the impact of Ireland’s economic crisis on the health system.

While health services have not been the major victim of budgetary cuts to the public sector, frontline staff and users of the public health system are feeling the hurt of the cuts that have been introduced to date.

The current bust is impacting on the public provision of health and social care in a more subtle and perhaps insidious way than it is in other areas. And one thing is for certain, more palpable hits are yet to come. Additionally the economic crisis is being used as a lever to introduce change that has been long planned but very slow to take effect.

Health service funding quadrupled from €4 billion in 1997 to €16 billion in 2008. Yet health funding had been levelling out since 2005/6 and in effect this was already being felt as a cut, as a constraining budget was providing more services to more people (with the population experiencing a baby boom and people living longer). Medical inflation has continued to rise alongside increased expectations and demands on health services. The budget allocated to health in 2010 was a 5 per cent reduction on the 2009 budget, the first actual cut experienced in the health system for two decades.

Health expenditure did increase significantly during the boom, however it was making up for decades of under spending and for a hugely under resourced health system in terms of staffing, buildings and equipment. It was investment that was long over due and needed to be maintained.

However the greatest failure of the boom time in health is that while budgetary allocation multiplied, there was lots of time wasting and rhetoric on ‘reform’. Yet the main deficiency in the Irish health system – the absence of universal health care – remained intact. In fact the inherent inequality in the Irish health system was allowed to flourish.

After the greatest period of economic growth (and subsequent decline) experienced by any developed nation, Ireland still has a system which privileges the richer half of the population over the poorer half in terms of access to public hospital care. This means that public patients can have to wait longer for what can be life saving diagnosis and treatment in public hospitals. (There are many other inequalities in the Irish health system, but inequality in access to public hospital care is the most critical).

Between 2001 and 2010 there has been much time, effort and money spent on reforming the Irish health services, most evident in the establishment of the Health Service Executive (HSE) in 2005. The setting up of the HSE is a perfect example of how not to reform a health system. There was no CEO for seven months; an ex-banker filled the role on an interim basis until one was finally found. Eleven different health boards, over 50 hospitals and multiple other health and social care agencies were merged into one centralised monolith. Yet not one person lost their job, no changed work practices were introduced, instead roles were duplicated, decision making stymied and there was little modification in how health and social care services were actually delivered – all under the name of ‘reform’.

Five years on, some improvements in clinical care are evident, and are most visible in cancer care, although this too has its own dilemmas with no service north of Dublin or Galway. The HSE has taken a long time to get its structures right, restructuring too many times to keep track of, and in 2010, there is little evidence they have got the formula right. There has also been a consistent effort under the HSE’s ‘Transformation programme’ championed by CEO Brendan Drumm of shifting from inpatient hospital care to day care, from hospitals to the community, of building up primary care and mental health services in the community. But progress has been very slow on all these fronts.

Now that money is in shorter supply, these issues have become more important than ever, with the economic crisis being used as a lever to introduce these ‘reforms’, which had been planned but largely unsuccessfully implemented until 2008/9. The mantra of HSE management has been ‘to do more with less’. By January 2010, there were over 3,250 fewer staff and 1,500 fewer hospital beds than there was in September 2007. At a certain point it is simply not possible ‘to do more with less’ unless real reform and better management are actually put in place.

Meanwhile from 2001 to 2010, there was a steady, although virtually silent, privatisation of many aspects of health care, most palpable in the Fair Deal scheme for older people. Privatisation is justified on the basis that it takes pressure off the public health system. It could also be interpreted that it is in the interest of the private (largely for-profit) health care providers for the public health system to fail, that building up and funding private health care undermines the public system.

A variety of measures have been introduced during the three national budgetary initiatives in response to the economic crisis in October 2008, April and December 2009. These include: the removal of medical cards as a universal entitlement to over 70 year olds; increased charges on patients such as higher fees for presenting at Emergency Departments, for public hospital beds and long stay charges; increasing how much two thirds of the population pay out of pocket for prescription drugs from €100 to €120 per month and introducing a 50 cent prescription charge for each item for medical card holders; and a cut in the capital budget for health services (i.e. buildings and equipment) of 26 per cent two years running.

These measures combined with lower incomes evident through increased unemployment, cuts to social welfare payments, and cuts in public sector wages of between 5 and 15 per cent mean that people have less to live on as well as increased costs of accessing health and social care services. These measures hit hardest those with least income who are also those with the poorest health, who need services most.

Interestingly, after the powerful demonstration of older people outside Dáil Eireann when the government announced the withdrawal of medical cards in October 2008 to all over 70 year olds, no further action has been taken to curtail the numbers covered by them. In fact there are now more people with medical cards than at anytime since 1996. Medical cards are an effective pro-poor measure as they enable people who may not be able to afford it to access healthcare they need. Yet essentially, in October 2008, the government removed the only aspect of universalism in the Irish health system.

In recessionary times, people need quality, public health services more than ever. However, if budgets continue to be cut, staff numbers and places of care reduced, the cuts will continue to impact on those who have the greatest need for services.

One of the great scandals of the boom is that our government failed to introduce universal access to health care on the basis of medical need, not ability to pay. The great disgrace of bust would be to run down the services that we have maintained and built up.

Cutting health and social care services now costs more in the short and long term, economically but more vitally in terms of people’s health, well-being and quality of life. Given how badly we managed the health system in times of plenty, it is unlikely we will do it any better in these times of less.