Health officials have called for cuts to overtime and agency work after reporting a big rise in such spending before the Covid-19 pandemic despite thousands of new health service staff being recruited.
“A decrease in the reliance on these staffing arrangements should be pursued,” Department of Health staff said in a review published on Friday by Minister for Public Expenditure Michael McGrath.
“Previous studies have found that not only are these temporary staffing arrangements a more expensive way to deliver healthcare in the long term, but they have also been linked to adverse patient outcomes.”
A second spending review – by officials in Mr McGrath’s department – found a “consistent overspend” for healthcare disability services despite the budget increasing 37 per cent in five years to more than €2 billion last year. “This trend has continued in 2020 when disabilities was an estimated 2.1 per cent [or €44 million] over the starting budget by year-end.”
Minister for Health Stephen Donnelly welcomed the findings on pay spending, suggesting they foster greater understanding. “The... paper has provided one of the most detailed analyses of agency and overtime expenditure in the Irish health service to date,” he said.
The review examined trends in 2012-2019 before the onset of coronavirus last year prompted another big rise in staff overtime and agency use. In the same period, the number of whole-time equivalent staff in the health service rose by 15,000 to reach 120,000 in 2019.
Annual spending on agency staff grew by 97 per cent in seven years, the review found. “Agency expenditure has had an almost constant increase from 2012 [€214.9 million] to 2019 [€423.3 million], with the only decrease shown in 2015, where expenditure fell 3 per cent [€9 million].”
The review went on to point out that annual overtime spending rose to a little below €300 million in 2019, up €92 million from 2014.
Driving factors
While acknowledging the increased reliance on such work to deliver healthcare, authors Emer Hanney and Claire Doyle said the factors driving it were not clear.
“One potential cause is that rising demand for agency and overtime is driven by staff supply shortages, implying that changes in permanent staffing levels is inversely related to agency and overtime usage,” the review said.
“An alternative theory is that rising expenditure on agency and overtime is driven by the rising demand for healthcare, implying that rising agency and overtime expenditure is correlated with higher levels of activity.”
Acute services where whole-time staffing rose 24 per cent after 2013 showed the lowest growth in agency spending. At the same time, “relative stagnation” in staffing in other services “may be driving the need for agency staff”.
There was “significantly higher growth” in agency spending in mental healthcare than in any other area. According to the review, mental health had the second smallest workforce and the highest agency spending after 2016.
In a third paper published on Friday, officials in the health and public expenditure departments said “careful targeting of services and effective cost controls” may help to limit rising expenditure expected with the promised introduction of a statutory scheme to support people to live in their own homes in old age.
“The financing model for the scheme has yet to be determined. Results of a scoping review of the available literature suggest that implementing a statutory home support scheme has the potential to significantly increase costs of long-term care,” they said.
