GUEST BLOG: A new direction in healthcare

Economy, Life sciences and energy | Thu 28 Apr | Author – Business & Finance
Jim Dowdall Glohealth

By Jim Dowdall, CEO, GloHealth

Taking a more strategic and holistic approach to our healthcare system can deliver a better outcome for all.

People are living longer than ever before thanks to healthier lifestyles, new drugs and significant advancements in medical science. While this is good news and we will see a continued improvement in longevity in the coming years, the flip side is that our changing demographics, due to an aging population, will result in a continuous increase in the demand for healthcare.

To service the current healthcare demands, in 2014 the Exchequer provided €13.2bn for healthcare services with a further €4bn being paid for healthcare by health insurers or by citizens directly. While an annual spend of over €18bn on our overall health system is very significant, there is no doubt that we simply don’t get the required outcome for this investment.

Exchequer funding provides for 55 acute hospitals and 12,500 beds with over 50% of this bed capacity already being utilised by people over the age of 65. Due to aging and improved survival rates some experts estimate that the current

Exchequer funding will need to increase by 4% per annum just to maintain the current level of service. Clearly, this is not feasible.


Why do we have a healthcare system that simply doesn’t work and what can be done to help address this situation?

To start with we need to move past the simple response that throwing more money at the problem is the answer.

True, the current budget for the public health system is not sufficient in the way the system is structured. Recent analysis seems to indicate that the problems come from weak management, poor organisation, unwillingness to change and archaic work practices.

It is time now for a new Government and the Department of Health to demonstrate new thinking in tackling the real issues that prevent the delivery of a better quality health service.

It is time now for a new Government and the Department of Health to demonstrate new thinking in tackling the real issues that prevent the delivery of a better quality health service

We need to urgently change the annual budget grant model of funding for the public system. The payment model in the private healthcare system is broadly based on remuneration for medical procedures actually carried out.

This incentivises private hospital managers to treat as many patients as possible. However, in the public hospital system the hospital manager may want to treat fewer patients in order to control a budget already granted, incentivising the existence of long waiting lists.

We must align funding to patient throughput and outcomes as a matter of urgency. The annual budget cycle also limits the ability to fund major change programmes.

We should provide a capital spend allocation for a number of years so that those responsible for managing the public health services can plan for the medium to long-term and invest in strategic change that will result in a better service being delivered.


A critical mindset change required by policy makers is to now consider both the public and private healthcare systems as part of the overall solution. No developed country can afford to provide for the healthcare needs of its population through a public health system alone.

On an annual basis the private health system provides over 1 million bed nights, carries out 250,000 theatre procedures, including 50% of all heart surgeries and 65% of all spinal surgeries, while also completing around 3 million diagnostic tests.

Imagine the state that the public system would be in if the private system didn’t exist and think how, if used strategically, we can further alleviate the burden on the public system and help deliver a better overall health service.

If we look back to the benefits previously achieved through the National Treatment Purchase Fund, we can see this played a big part in reducing waiting lists and alleviating demand on the public system. Let’s restore a similar model and provide the managers of the seven public hospital groups with the ability to procure services from the most cost effective setting.

Engaging early and strategically with private healthcare operators would also help pre-empt the far too frequently occurring capacity crises in the public health system.

When we look at the challenges and issues with the current health system it is clear that the status quo is not an option.

We need the new Government to be determined to effect meaningful change – some of which can be implemented straight away. There is no doubt that the results would be a positive step forward towards the quality health system we all desire.