A Country Report adopted by the EU Commission today is highly critical of Ireland's health system, which it says "faces a crisis of cost-effectiveness".

The report states "year after year significant overspends are recorded in healthcare, yet process and output measurements do not reveal an improvement in performance. Neither are the persistent deficits attributable to any major expansion in service provision".

The report was part of the economic policy recommendations for each of the 28 EU states under the EU’s "European Semester" process, aimed at co-ordinating budget policy across the member states. 

The Commission says despite Ireland’s young population (relative to other European states) - which should mean lower per capita health spending, as older people are the biggest consumers of health care - "Ireland is one of the highest per capita spenders on health in the EU and the ageing of the population is likely to lead to higher spending and fiscal sustainability concerns".

It says: "Considerable scope exists for savings to be made, potentially freeing up resources for ambitious reform plans", notably Sláintecare. It says the cost of implementing Sláintecare will be high, but not implementing it would be even costlier.

The report says much of the cost problems of the Irish health service lie in the hospital system: "Public hospitals constitute an area where the cost-effectiveness crisis is most acute. Over the 2014-2017 period expenditure increased by 17% while outputs remained relatively flat and waiting times increased sharply.

Compared with other EU countries, Ireland has the highest occupancy rate for one of the lowest numbers of hospital beds per 1000 population. Efforts to implement Activity-Based Funding, as well as Performance and Accountability Frameworks, have only had limited success so far and there has been little progress since the 2015 Flory Report, which stressed the need for hospitals to produce realistic annual efficiency improvement plans".

It slates the management of money in the health system, and says this partly explains the constant over-runs in the health budget: "Budget management is weak across all levels of the health system. The framework of accountability for expenditure under the Health Service Executive to parliament is highly complex, and the HSE has repeatedly struggled to effectively manage a budget and stay within it, despite subsequent annual increases in expenditure.

"Comprehensive planning and funding models are either non-existent, poorly functioning or unconnected locally and regionally. Governance and accountability are hampered by lack of data on health workforce and private practice. For 2019, the Department of Health plans to increase the budget allocation for the HSE while requiring it to avoid overspends."

It says more money will be needed to address even basic health care access, such as GP visits and the development of primary healthcare centres to take the strain off the hospital system: "Access to some core health services is still not universal in Ireland. An outlier in the EU, only around 50% of the Irish population are covered for the costs of general practitioner visits, and general practitioners are reluctant to see both coverage and service provision expanded without a commensurate change in remuneration.

"Without the expansion of coverage under Sláintecare, patients will continue to use hospital services for conditions that should normally be treated in primary care settings. Strong investment needs remain in order to deliver care at its lowest point of complexity."