Hospitals are to receive a €200 million financial bailout to avoid a looming financial crisis after five of the biggest Dublin facilities warned they expected to be unable to pay all staff in full before Christmas.
The chairs and chief executives of St James’s, the Mater, St Vincent’s, Tallaght and Beaumont hospitals said in a letter to the Health Service Executive three weeks ago they were collectively facing a financial shortfall of more than €100 million.
The letter sent to HSE chairman Ciarán Devane and chief executive Bernard Gloster on November 13th said that “due to the cash limits set for the hospitals, it is expected that hospitals will not be in a position to fully pay all of their staff and suppliers in the months of November and December”.
The hospitals – which all have their own boards and are not run directly by the HSE – also warned of the potential implications for patient services.
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“Apart from the fiduciary responsibilities and duties of hospital boards under company law and corporate governance, the budget gap presents the prospect of a significant curtailment of services across the Dublin hospitals if we are being tasked to deliver contracted services within the allocation provided.”
Following queries about the letter from The Irish Times on Friday, the HSE said on Friday night that hospitals would be receiving additional funding.
“Within the overall cash funding provided by government to the HSE in 2024, it has been possible to allocate about €200 million in final additional cash to a number of our larger voluntary partners over the last week or so including the five hospitals referred to as well as disability and community voluntary providers.
“With this final 2024 allocation, the HSE is satisfied that these voluntary organisations have sufficient cash to meet their needs.”
The HSE said its regional health service executives would reply to hospitals in their areas next week “now that the final cash allocation process referred to above has been completed”.
The voluntary hospitals, as they are known, receive hundreds of millions in funding from the HSE to deliver services for patients under service level agreements.
The voluntary hospital chiefs said given the “extreme financial constraints” they were facing, they had no alternative but to invoke dispute resolution procedures under their service agreement with the HSE.
The hospitals, in the same letter, said the HSE had “unilaterally imposed” financial and staffing limits without consultation on July 26th this year.
“The budget gap presented in 2024 is on top of historical deficits, and deficits left with the hospitals in 2023 due to insufficient supplementary funding for services delivered.
“The hospitals now find themselves in a financially uncertain position, which for some hospitals raises issues with their external auditors on the ‘going concern’ principle.”
The hospital chiefs argued that collectively they had delivered about 8 per cent more activity than set out in their targets.
“Hospitals are left with uncertainty regarding how the funding required to meet this level of demand will be provided.”
The hospitals maintained pay awards for staff after forecasts made in the first quarter of the year had not been funded, nor had HSE contract prices increased.
They argued expenditure on drugs under demand-led schemes such as on Pembrolizumab for cervical cancer patients had not been funded.
They also maintained the first of the surgical hubs – one of the government reforms aimed at tackling waiting lists – was “ready to go live without an agreed financial limit”.
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