In a letter to HSE staff this evening, the HSE has said it is preparing to set aside around €200m from budgets, to offset overruns that may be building up as a result of industrial action by staff.
The letter from HSE chief executive Prof Brendan Drumm says the current industrial action involves some staff simply not performing the duties that are fundamental to their employment.
He said that staff are continuing to receive full pay, yet are not doing the work they are paid to do, and that this is having a severe affect on the HSE's ability to manage its business.
Prof Drumm wrote that he hopes there is still a window of opportunity to deal with the issues but in the absence of a resolution in the very near future, the HSE will be forced to take a more direct approach.
He said that if cuts were introduced they would have an immediate effect on services and patients.
One area being examined is the use of contract staff.
The IMPACT trade union has refused to provide a derogation from the action to allow financial data to be compiled.
It is awaiting clarifications on the Croke Park pay deal and has accused the HSE of trying to intimidate members into ending the action, with threats that staff could be taken off the payroll.
