Camillus Glynn (Fianna Fail)

I move amendment No. 1:

To delete all words after "That" and substitute the following:

Seanad Éireann

—commends the Government on the measures it is promoting to improve access for public patients to acute hospital care;

—supports the Tánaiste's policy to develop private hospitals on the campuses of public hospitals in order that up to 1,000 beds currently reserved for private patients may be redesignated for use by public patients in the most cost-effective way;

—notes that the Health Service Executive has invited expressions of interest from developers who are interested in developing private hospitals at 11 public hospital sites;

—notes that the process is being conducted in accordance with the relevant EU law and will adhere to public procurement rules and best practice and will fully protect the public interest; and

—supports the Government's policy of encouraging public and private sectors to work together in the provision of health care for the benefit of the entire population and encourages further innovation and initiative in this regard.

Tá fáilte roimh an Aire. I welcome the opportunity to debate this motion.

As someone who was involved with the health board system for some time, both before and after its demise, it seems that one advantage it still has under the aegis of the HSE is that it holds a fair amount of property. I am in favour of the proposal that properties surplus to the HSE's established requirements should be devolved to another sector or arm of the health services.

The public private mix in public hospitals has long been a feature of the health service. While it has advantages when it comes to sharing clinical expertise, it has been recognised that inequities have arisen for public patients. That is a fact. This initiative will improve access for public patients while providing insured patients with new, purpose-built hospital facilities.

It is also a central element of the policy as set out in the Finance Acts that public patients should be able to access new private facilities. That can be done through the National Treatment Purchase Fund or by direct arrangement with the HSE. The Tánaiste has given very clear reasons to pursue that objective, to which there is a strong degree of logic. Whether we like it or not, all consultants employed in hospitals, irrespective of discipline, have several private patients and a private practice.

In 2001, the health strategy contained a commitment to increase acute beds by 3,000 over a ten-year period. That year, the average number of inpatient beds and day places available for the treatment of patients in public acute hospitals was 12,145. Hospital returns for 2005 show that the number has now risen to 13,255, an increase of 1,110 inpatient beds and day places. Some 90% of treatment places in acute hospitals are overnight inpatient beds. In addition, a further 450 acute beds or day places are at various stages of planning and development under the capital investment framework for 2005-09.

In July 2005, the Government announced an initiative to have private beds built on the campuses of public hospitals. The aim of the initiative is to enable up to 1,000 beds in public hospitals that are currently being used by private patients to be redesignated for use by public patients. I do not see anything wrong with that, I think it is a good initiative.

By allowing a new private hospital to take a substantial number of private and semi-private beds out of our public hospitals we will create new beds for public patients in the fastest and most cost effective way over the next five years. This will bring together different areas of Government policy in a coherent and practical way in order to increase bed capacity for public patients in public hospitals.

Encouraging the participation of the private sector in generating extra capacity maximises the potential use of public hospital sites, promotes efficiency in public and private acute service providers, promotes greater competition in the supply of hospital services and offers improved quality and choice to all patients. Choice is a very important element of our health service. The public-private mix has proven difficult to manage and resource and cost sharing is not as clear as it should be. Separating the management and financing of a substantial portion of private beds will bring greater clarity to such issues.

Since 1999, it has been Government policy that the full cost of private beds in public hospitals should be paid by insurance companies. This initiative, which incorporates the policy of full economic charging, will bring about an increase in the number of public beds and new hospital facilities. This is a realistic and achievable objective. It will offer tax breaks on private hospital investment and there is an important rationale behind this concession. By locating new private hospitals adjacent to existing public hospitals we will make their roles complementary. The initiative is designed to support the policy of building regional self sufficiency in our hospital services. Team-based working arrangements in the hospital are required to ensure best patient care and will be introduced.

This policy is a key part of the context for a new consultants' contract, which has been overlooked. Most Members of the House would agree a new contract must be negotiated.

Cost effectiveness is of great importance because we are all long-suffering taxpayers. This plan is designed to be a cost effective way of expanding the supply of beds for public patients. The scheme of capital allowances for the construction of private hospitals was reviewed by Indecon Economic Consultants as part of the overall review of property tax incentives in 2005. Indecon consulted widely in the course of its review which was published in February 2006, including consultations with the Department of Health and Children and the HSE.

When a new public bed is provided in the traditional way, the Exchequer bears 100% of the capital cost. By moving private beds into a new facility and thus allowing for new public beds, the State bears less than 50% of the capital cost. The running costs of the private beds would no longer be subsidised or managed by the State and taxpayers' money is saved. These beds are currently staffed by nurses paid through public funds, therefore, all that is required is the relocation of the private beds to a new facility financed by private investors. These facilities would be co-located, so consultant staff would be on site for both public and private patients. Consultants can use their time more effectively if they work in one place only, as opposed to many different sites.