Billy Kelleher (Cork North Central, Fianna Fail)
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1077. To ask the Minister for Health in relation to the proposed project 86156-3402 in the provision of a patient level costing system, if he will provide a breakdown of the costings involved in the pilot project; and if he will make a statement on the matter. [34275/14]

Billy Kelleher (Cork North Central, Fianna Fail)
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1078. To ask the Minister for Health in relation to the proposed project 86156-3402 in the provision of a patient level costing system, if he will detail all the parties/users who will have access to this shared information; and if he will make a statement on the matter. [34276/14]

Billy Kelleher (Cork North Central, Fianna Fail)
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1079. To ask the Minister for Health in relation to the proposed project 86156-3402 in the provision of a patient level costing system, the way this scheme will be funded; and if he will make a statement on the matter. [34277/14]

Leo Varadkar (Dublin West, Fine Gael)
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I propose to take Questions Nos. 1077 to 1079, inclusive, together.

A Patient Level Costing (PLC) system is being introduced in the context of the implementation of a new funding system for public hospital care called Money Follows the Patient (MFTP). Phase 1 of MFTP commenced in January 2014 and full implementation will take a number of years. MFTP involves moving away from inefficient block grant budgets to a system where hospitals are paid for the actual level of activity undertaken. As such, hospitals will be funded based on the quantity of the services they deliver to patients. They will be liberated, subject to overall budgetary ceilings, to pursue the most cost-effective means of delivering quality care. Budgetary discipline will be delivered through the use of fixed budgets for MFTP activity. The MFTP approach is initially being applied to inpatient and day-case activity in public hospitals. However, it is intended that the payment system will extend over time to cover other hospital activity and community care.

An effective PLC system is essential for the proper operation of the MFTP process. It will enable hospitals to understand their costs and, therefore, to operate effectively in the MFTP funding environment. Although a pilot PLC project has been underway since 2010, the PLC function must now be embedded across all hospitals. This will require investment in skills and also in PLC IT systems and feeder IT systems to improve cost collection. The data provided by the PLC pilot is being used in conjunction with the current speciality costing methodology to set prices for services and this will continue when rolled out to more hospitals.

The HSE published an Invitation to Tender for a PLC System, to include knowledge transfer, in July of this year with a closing date of 26 August. The tenders are currently being evaluated and this process is expected to be completed by October. Assuming a successful outcome, it is intended to establish a contract for the provision of the solution the fourth quarter of this year.

I have asked the HSE to respond directly in relation to the additional detailed information requested by the Deputy.