ANALYSIS: The Government is taking on vested interests but has not resolved its difference over how to pay for health, writes Mark Brennock, Chief Political Correspondent.
The Minister for Health, Mr Martin, has always argued that as more and more people are being treated with better and better drugs and procedures, the costs of the health services are bound to rise.
The Minister for Finance, Mr McCreevy, however, has consistently argued that what is required now is not billions more in resources, but greater value for money, achieved through a transformation of the structures that deliver health services.
As health spending soared from £3.6 billion in 1997 to over €9 billion this year, health began to be depicted by the Taoiseach and Ministers as a "black hole" as far as money was concerned. This view has now spread around the Dáil chamber.
Even the Labour Party, in its attack on the Government in the Dáil this week over broken promises, criticised the Government not for underfunding the health services, but for not getting value for money.
So while the health strategy of 18 months ago - with its promise of €10 billion in spending over 10 years - encapsulated the Martin doctrine, yesterday's Health Service Reform Programme published by the Government is the blueprint for the implementation of the McCreevy agenda.
It promises many changes long sought by black-hole theorists: rationalisation of health agencies, the abolition of the 30-year-old health board structure, a new executive agency to manage the health service, making health professionals more responsible for their spending, modernising management, and substantial use of new information technology.
In addition, a major push to change the way hospital consultants work appears imminent. And local interests seeking to preserve small local hospitals are to be taken on as the Government seeks to centralise hi-tech medicine in "centres of excellence".
"Politics, including local politics, has to stop at the door of our hospitals", the Taoiseach declared on Tuesday night.
If the Government sticks to this determination, it will be a politically brave move. A threat to close a local hospital tends to lead to the emergence of a "save the local hospital candidate" who stands a good chance of getting elected and threatening the Government's majority.
But faced with the fact that they cannot now afford to commit the money promised in the health strategy, the Taoiseach and his Ministers are pushing the value for money agenda very hard. The process of reform outlined yesterday will test the "black-hole theory" over the next few years.
Health is now and always a dangerous political issue for the Government, with voters' personal experience of the health services and the constant press coverage of the failings in the health service liable to lead to a build-up of anti-Government feeling. That is why the detailed health strategy was launched before the last election in an effort to neutralise the issue. It is also why the Government - short of the funds promised in that strategy - is coming at the issue again.
Voters don't care in the least about the structures within the health services, except insofar as they have been told that they contribute to the bed shortages, long waiting lists to see consultants and the chaos they so often encounter when seeking health care. Politicians, medical professionals and even many health board personnel accept that these reforms are a good thing. But unless they achieve enough value for money to transform the public's experience of the health services, they won't defuse the issue politically.
Ministers at yesterday's press conference were very cautious about predicting that these reforms would, in fact, transform the service available to the public.
Mr Martin would only say (twice) that he believed the reforms, when implemented, would bring "far greater consistency in regard to hospital services across the country", and would smooth the path towards aims such as the development of centres of excellence for cancer care.
There is, therefore, little Government confidence then that these reforms alone will resolve the political issue which has blighted the Government's claim to have transformed the State during the economic boom. The funding issue hasn't gone away.
Mr Martin pointed to this yesterday, when calling for more "balance and perspective in how we view the whole health system". More people than ever were being treated, quality was improving, productivity was increasing. "Most importantly, I think we all have to recognise that with the plans, there are challenges for society more generally", he said.
He didn't spell out these "challenges for society". But they undoubtedly include the question he has raised a number of times recently: how to pay for the health services. As better treatments continue to become available, the cost of the health services will continue to rise. Unless Government is going to restrict access to life-saving and life-enhancing treatments, it must face the political decision as to how to pay for it.
Yesterday, Mr McCreevy laid out the dramatic reality of health costs. In 1997 the State collected €6.625 billion in tax and spent €3.6 billion on health. In 2003 it expected to raise €9.307 billion in tax and spend all of this on health.
Or to put it another way, 19 per cent of public expenditure was spent on health in 1997; 24 per cent of a greatly increased public spend is going to health in 2003.
Mr Martin implicitly raised the "who pays" question later, suggesting that further escalation in health costs was inevitable. Some €50 million extra was being spent on cardiovascular treatment this year, he said. This was "good news" for him as Minister for Health (because sick people were getting better) but "bad news" for the Minister for Finance (because it is an awful lot of money).
He said the bill for drugs dealing with peptic ulcers had gone through the roof. He could have listed many more of what he called "cost drivers".
However, the Tánaiste ruled out paying for the inevitable cost increases through taxation. She suggested that the lower the tax rates, the higher the tax revenue available to the Exchequer (although if this is the case, one wonders why they haven't cut tax rates still further).
So this leaves the Government driving forward with the reform agenda, hoping that if implemented it will deliver some cost savings. Even the Government itself doesn't expect it to resolve the underfunding of services.
Divided on how much and how to fund the health services, Mr Martin and Mr McCreevy are united behind the reform plans. But to borrow a phrase, the issue of how to fund the standard of health service expected by voters in a rich country hasn't gone away you know.