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DPER refused to support draft memo on new regions due to HSE’s finances

By Dermot - 21st Nov 2019

The Department of Public Expenditure and Reform (DPER) refused to support a draft memo for Government on the creation of regional integrated care organisations (RICOs) due to the precarious financial position of the HSE, the Medical Independent can reveal.

Mr Ronnie Downes, Assistant Secretary, Central Expenditure Policy, DPER, outlined the decision in correspondence with Dr Colm O’Reardon (PhD), Deputy Secretary General, Policy and Strategy, Department of Health, on 19 June 2019, which has been obtained by this newspaper through Freedom of Information law.

Mr Downes referred to a recent meeting between the DPER and the Department of Health, during which the subject of RICOs was discussed.

“[W]e… agreed that any such substantive decision on the part of Government would need to be taken on the basis of a fully-developed and tested business case which, realistically, would involve a period of intensive preparatory work, which we in DPER would do our part to support,” according to Mr Downes.

“We also agreed that, in the interests of helping to foster a sense of direction as part of the Sláintecare Implementation Strategy, there may nevertheless be merit in bringing a memo to Government to inform them of the work-to-date in developing geographical templates for future RICOs… ”

However, Mr Downes said the DPER’s position regarding the memo changed as a result of the HSE’s financial performance in the first quarter of the year, which was worse than expected.

“I have to say that in light of the alarming news regarding health sector over-spending in Q1 2019 — which now appears to be far worse than previously indicated — the narrow space for even such a memo may now have evaporated, and we will not be in a position to support such a memo in advance of an urgent engagement on how the over-riding priority of cost management is being addressed,” according to Mr Downes.

Mr Downes stated in previous correspondence on 30 May that the DPER had “serious reservations” about the RICO plan and that it would be “premature” to press ahead with the proposal.

In response, on 20 June, Dr O’Reardon stated the Department of Health fully shared the concern about the emerging financial position in the HSE.

He added that this did not change the fact that “fundamental reform of the HSE” was necessary and amendments had been made to the draft memo “to more clearly reflect the work that is required before the Government can or should commit itself to implementing the RICO model”.

The proposal to divide the health service into six regions was announced by the Government on 17 July 2019.