Questions and answers about coronavirus and the UK economy
Questions and answers about coronavirus and the UK economy

How is Ireland’s healthcare system coping with coronavirus?

Hospital capacity constraints have been a key factor in Ireland’s policy response to Covid-19. But as demand for healthcare continues to grow, and with the risk of a renewed surge of the virus, new thinking will be required to meet healthcare needs and support economic recovery.

At the outset of the pandemic, health officials and politicians worldwide emphasised the need to ‘flatten the curve’ to ensure that health and emergency care facilities were not overwhelmed by the ensuing onslaught from the illness. In all healthcare systems, responses focused on preventing capacity being stretched beyond its limits. Few countries in Europe were as exposed to a Covid-19 surge potentially overwhelming the hospital system as Ireland.

The low levels of public hospital capacity not only informed the initial responses, but they continue to be a key factor in planning future responses. The tightness of hospital capacity constraints in Ireland is likely to have reduced much of the flexibility that policy-makers have to lift public health restrictions on other parts of the economy and society. But a more solid basis for government borrowing and a better than expected economic performance may provide enough fiscal capacity for the state to invest in the required healthcare capacity.

Ireland’s economic prospects during coronavirus: better than expected?

The pandemic has severely affected Ireland’s economy and society. The unemployment rate is currently at 14.7%, down from a peak of 30.4% in April, but still three times higher than February’s rate of 4.9% (McQuinn et al, 2020). Yet economic output and some sources of tax revenue have held up relatively well compared with other European countries.

In the second quarter of 2020, Ireland’s GDP contracted by 6.1%, less than the 11.4% average across all EU-27 countries or the 19.8% contraction in the UK (Eurostat, 2020). Despite widespread job losses, income tax receipts were down only 1.4% in the year to August compared to 2019. This unexpectedly strong performance is attributed to the way that job losses have been concentrated in specific sectors and occupations, combined with the progressivity of the income tax system in Ireland (McQuinn et al, 2020). Corporation tax has also remained buoyant.

The net effect of the crisis on Ireland’s fiscal position has so far been less negative than initially expected: forecasts suggest a budget deficit of 6% of GDP in 2020. The relative resilience of Ireland’s economic output is attributed to a strong performance by the export sector, particularly associated with multinationals involved in pharmaceuticals and ‘Big Tech’. This masks a severe downturn in the domestic economy, especially in some service sectors (O’Toole, 2020).

The stronger than expected overall economic performance, along with access to low-cost borrowing, has provided financial flexibility to the government in combating the implications of Covid-19. This contrasts with the strict austerity policies during the Great Recession.

There has been continued support of workers through the pandemic unemployment payment (PUP) and (temporary) employment wage subsidy schemes (TWSS, EWSS). The EWSS has the key benefit of allowing employers to keep workers on their payroll through the pandemic, with the government providing payments to employees through employers’ payroll systems. This should help to reduce some of the negative unemployment ‘scarring’ effects (Arulampalam, 2001) once the economy re-opens.

Substantial additional funding has also been provided to the health service. At least €2.2 billion of additional spending attributable to Covid-19 will be spent in the public health service in 2020 (PBO, 2020; HSE, 2020). This compares with the €17 billion allocated to the Health Service Executive (HSE, which is responsible for the provision of public health and social care) for 2020 (HSE, 2019). Much of this additional spending, including procurement of private hospital facilities, is driven by the low levels of public hospital capacity that existed before Covid-19.

How did Ireland’s healthcare capacity compare with other countries before coronavirus?

While the economic situation in Ireland before Covid-19 was favourable, the same cannot be said for the health service. Prior to the pandemic, the Irish public hospital and community care system had severe capacity constraints (Keegan et al, 2019; Smith et al, 2019).

Table 1 illustrates Ireland’s low level of public hospital capacity compared with several other countries and the EU-15 average. Despite total healthcare expenditure being slightly higher than the average, hospital beds and intensive care beds per capita were considerably below EU averages. In-patient bed occupancy rates averaged 95%, the highest in the OECD.

Table 1: Comparison of healthcare indicators in Ireland, other countries and the EU-15

Table showing comparison of healthcare indicators in Ireland

Sources: OECD. Health at a Glance 2019; OECD. Beyond containment: Health systems responses to COVID-19 in the OECD

‘Nationalisation’ and procurement of facilities

As Table 1 shows, non-government financing makes up 26% of healthcare expenditure in Ireland, higher than most countries in Europe. One reason for this is that Ireland is unique in a European context as the full population does not have free access to public healthcare and there is a mixed public-private system of payments and provision (Connolly and Wren, 2019). Approximately 32% of the population has an income means-tested Medical Card entitling them to free public healthcare. Approximately 11% of the population, including all children under six and over-70s, have a GP Visit Card providing free GP care. In addition, 46% of the population (the vast majority of those without a Medical Card) have private health insurance.

Private hospitals play a central role in the delivery of acute care, particularly elective (scheduled) care. Private hospitals provide 30% of all day-patient activity and 15% of all in-patient bed days (Keegan, Brick et al, 2019). But virtually all acute emergency care and acute care for patients with Covid-19 occurs in public hospitals, even for patients with private health insurance.

An early step taken by the Irish government during the pandemic was effectively to nationalise the private hospitals on a temporary basis. Other healthcare systems, including NHS England, secured private bed capacity to aid the state’s response to Covid-19. But in mixed public-private systems, such as those in Ireland and Australia, due to the large relative size of private hospitals, the procurement of the sector has significantly increased the capacity available. It is estimated that the procurement of private hospitals by the state increased in-patient bed and critical care (intensive care) capacity by 20% and 13% respectively in the two countries.

Other facilities were also procured and established at a rapid pace. One of Ireland’s largest convention centres was converted into an isolation and step-down/recuperation facility (the Irish equivalent of NHS Nightingale), adding 450 beds for post-Covid-19 care. Similar but smaller facilities were also set up in other parts of the country to alleviate pressure on hospitals.

Rapid changes also occurred within the primary care system. A number of health and primary care centres were reconfigured into ‘community assessment hubs’ for the purposes of assisting with Covid-19 testing, and drive-in testing was offered from facilities such as sports stadiums. As the population without a Medical Card or GP Visit Card ordinarily pay at least €50 per GP consultation (Connolly et al, 2018), there were fears that such costs would inhibit people with Covid-19 symptoms presenting for testing. Therefore, all Covid-19-related GP consultations were covered by the state.

These actions, many of which would not have been considered previously, provided authorities with practical solutions and a significant capacity buffer in the event that Covid-19 placed an excessive burden on existing facilities.

Did Covid-19 overwhelm Ireland’s public hospital system?

The first confirmed case of Covid-19 in Ireland occurred on 29 February; following that case, Covid-19 hospitalisations quickly increased. Figure 1 shows that the number of people in hospital as in-patients and in critical care reached almost 900 at the peak in mid-April and reduced steadily thereafter.
By mid-October, there were 225 people in hospital with confirmed Covid-19, 29 of them in intensive care, with numbers trending upwards (although from a low base). This has resulted in Ireland once more imposing restrictions at the behest of the National Public Health Expert Team (NPHET) to try to reduce the spread of Covid-19 into the winter months.

Figure 1: Covid-19 hospitalisations in Ireland: 11 March to 15 October 2020

Figure showing Covid-19 hospitalisations in Ireland

Sources: Health Service Executive (HSE) Daily Operations Report

Pent-up demand and waiting numbers continue to increase

Evidence shows that Germany’s well-resourced healthcare system may help to explain its comparatively low fatality rate for Covid-19 (Tan and Trujillo Jara, 2020). But while Ireland’s much less well-resourced hospital system came under severe pressure, it was not overwhelmed. Some of this was because Covid-19 hospitalisations were not as high as was initially feared. In addition, sufficient capacity was also made available for Covid-19 as both public and private hospitals stopped or curtailed elective activity.

While care is required when comparing across countries, it appears that Covid-19 survival rates in Irish hospitals have been high by international standards, with 80% survival rates for Covid-19 patients in hospital (HPSC, 2020). Caveats to these survival rates include the fact that the data capture confirmed and suspected Covid-19 deaths from hospitalised cases, and the relatively high proportion (over 50%) of Covid-19 deaths occurring within nursing homes (Comas-Herrera et al, 2020).

In addition to hospitals curtailing elective activity, there has been a sharp change in hospital care demand and use in the initial part of the pandemic. Between February and April, there was a 31% reduction in emergency department attendances, with a large reduction across all severities of illness as measured at triage (Brick et al, 2020). The reduction in emergency department demand was put down to fear of the virus, reduced referrals from GPs and fewer injuries due to reduced travel and activity.

Figure 2 captures some of these changes in hospital use, showing how occupancy rates reduced from close to 100% to under 80% within a month. Since April, there has been a steady increase in use. Occupancy rates have increased to more than 95% once more, at a time when Covid-19 infections rates are also increasing. This severely constrains the ability to meet demand for hospital care.

Figure 2: Public hospital bed occupancy rates: 7 March to 15 October 2020

Figure showing public hospital bed occupancy rates

Sources: National Office of Clinical Audit.
Note: Seven-day moving average. Captures critical care demand and capacity for Ireland’s Model 3 and 4 adult hospitals.

Unlike general hospital beds, there has been more flexibility in the supply and occupancy of critical care beds. Figure 3 shows that the number of critical care beds fluctuated over time as resource allocation responded to demand pressures. The number of Covid-19 cases in critical care peaked at approximately 150 in early April but has fallen since, and it remains relatively low at 30 cases despite recent increases in cases. But in absolute terms, the number of open and staffed critical care beds remains low by international standards.

Figure 3: Public hospital critical care demand and capacity: 27 March to 11 October 2020

Figure showing public hospital critical care demand and capacity

Sources: ICU-Bed Information System (ICU-BIS) National Office of Clinical Audit.
Notes: *Refers to baseline sustainable critical care capacity – ICU Bed Capacity Census, May 2020. This figure captures critical care demand and capacity for Ireland’s Model 3 and 4 adult hospitals.

While Ireland’s hospital system has had some success in managing the additional burden of Covid-19, the numbers waiting for care has continued to grow. In recent years, the public hospital system has struggled with long waiting times for elective care.

While it is difficult to compare waiting list data across countries, there is evidence that waiting numbers and times for care in Ireland far exceed European peers (Siciliani et al, 2013). For a population of just under five million prior to the outbreak of the pandemic, there were over 600,000 cases on outpatient waiting lists. Lack of capacity is a key reason behind these long waiting lists, and this follows research from Australia showing that increases in bed occupancy are clearly linked with longer waiting times (Johar et al, 2012).

Between January and May 2020, day-patient and in-patient waiting numbers increased by 42% and 20% respectively (see Figure 4). While outpatient waiting numbers increased by a lower rate (around 3%), this may be more reflective of the difficulties involved in making it onto the outpatient waiting list.

Waiting times also lengthened. At the end of August, 70%, 82% and 78%, respectively, of people waiting as day-patients, in-patients and outpatients had been waiting for more than three months, with 40% of outpatients were waiting for at least 12 months. These figures underestimate the true waiting numbers as they do not capture the fall in the numbers not being added to the lists due to lack of use of, for example, GP services. In addition, these data do not capture private patients waiting for care in private hospitals.

Figure 4: Public hospital day-patient, in-patient and outpatient waiting: January to August 2020

Figure showing public hospital day-patient, in-patient and outpatient waitingFigure showing public hospital day-patient, in-patient and outpatient waiting (2)

Source: National Treatment Purchase Fund: Day-patient and in-patient; Outpatient

What does the future hold?

The ramifications of Covid-19 for the Irish, and other (Karjalainen, 2020) healthcare systems are far reaching and will require considerable short-, medium- and long-term planning. Covid-19 has shone a light on the insufficient hospital capacity in Ireland that was evident prior to the pandemic. This low level of capacity will continue to affect the country’s options for responding to the pandemic and for how resources can be targeted within the healthcare system.

The health authorities have thus far shown the ability to respond to severe capacity constraints, often in novel and speedy ways. More innovative planning is needed to continue to accommodate Covid-19 surges while trying to meet the high level of pent-up demand for care.

In September, the HSE announced an ambitious plan to increase the country’s healthcare capacity and workforce, and to reconfigure care towards the community – the ‘Winter Plan’. To support this plan, the government has earmarked an additional €600 million to increase acute, critical care and step-down care bed capacity. In total, an additional 12,500 staff in the areas of testing and health and social care services are to be hired by April 2021. This is a 10% increase in HSE staff levels (HSE, 2020) in a six-month period.

Like other countries, Ireland is struggling to attract healthcare workers. Ireland trains a large number of medical and nursing workers, but fails to employ many graduates (OECD, 2019). Many Irish medical and nursing workers work abroad, especially in English-speaking countries. For example, Irish doctors and nurses are the third most common non-UK nationality in the NHS.

Attempts have been made to address this challenge. On St Patrick’s Day, a ‘Be On Call’ for Ireland scheme was launched to attract Irish healthcare workers back. The scheme had little impact: despite over 73,000 people applying for the scheme, by August, only 209 had been hired by the HSE. This suggests that attempts to increase capacity will be curtailed by the challenge of matching skills with needed staff positions.

Before Covid-19, public waiting lists in Ireland were already lengthy. It is clear that it will take considerable time to begin clearing waiting lists, especially as Covid-19 continues to circulate. But as occupancy rates in public hospitals have returned to pre-Covid-19 levels (97%) and with the anticipation of increased winter demand, there are plans in place to re-engage private facilities to ensure continuity of elective procedures, allowing unscheduled emergency care to take priority in public hospitals.

This should be a top priority for policy-makers. Consideration should also be given to how to allocate scarce capacity optimally across specialties and treatments to maximise total health gains (Gravelle and Siciliani, 2008).

What about non-acute care?

Healthcare systems have initially focused on increasing acute capacity to combat Covid-19. In countries like Ireland with severe acute capacity constraints, this focus was necessary. But a continued focus on acute care may result in primary and community care becoming squeezed and unable to meet demand from non-Covid-19 patients, especially those with mental health needs. Greater focus on primary and community care may better reflect the needs of the Irish population.

Ensuring that primary and community care become central to the delivery of healthcare in Ireland also aligns more closely with the proposals made under a new proposed universal healthcare plan called Sláintecare (‘Sláinte’ means ‘health’ in Irish). Ireland has never had an NHS-type universal healthcare system. Sláintecare is the first plan, with cross-party political support, which proposes to establish a ‘national’ health service for all in Ireland.

The plan is ambitious. It concentrates on moving away from a hospital-centric system towards a community and integrated care system with more localised decision-making, and to ensure a better resourced system with the flexibility to care for the population (Burke et al, 2018). This may help to alleviate pressures on acute hospitals, and focus on increased use of primary and community care for chronic disease management, clinical testing, home care for older people and treatment of less complex illnesses.

Despite the intended ten years to implement (2018-2028) Sláintecare, in March, the chief executive of the HSE was quoted as saying that they were implementing ‘Sláintecare on speed’ as a consequence of Covid-19. While elements, such as the expansion of GP Visit Cards to all children, have been delayed, some elements have been accelerated. The Winter Plan has proposed large increases in home support hours, community care beds and community care more generally. While policy-makers need to address the imminent dangers of Covid-19, ensuring that the needs of all patients are met, as well as the continued implementation of Sláintecare, should be a clear policy focus in the short and medium term.

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Authors: Brendan Walsh, Conor Keegan, Aoife Brick, Seán Lyons
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