The Public Accounts Committee has been told that the HSE could lose €50m this year because of an irregularity in the new contract for hospital consultants.
The Health Service Executive's Professor Brendan Drumm told the committee that they had not foreseen the problem and they would have to work to fix the anomaly.
The new consultants' contract was agreed last year after protracted negotiations.
Under the contract, Type A consultants cannot bill health insurers for private patients.
The problem arises when one of these consultants admits a private patient to hospital - the HSE is left to pay the cost because the insurer cannot be asked to foot the bill.
Fianna Fáil TD Sean Fleming said he was shocked by the oversight and called it a backhanded subvention to the insurers.
But the Department of Health's Secretary General Michael Scanlan denied that the oversight resulted in a subsidy to health insurers.
