Open letter to Mr John Buckley, Comptroller and Auditor General, Treasury Block, Dublin Castle, Dublin 2.
Dear Mr Buckley,
I wish to inform you of the multiple errors that I have discovered in various HSE-funded financial statements or reports pertaining to GMS general practice funding and operating expenses. The most significant mistakes pertaining to your responsibilities are:
• The Primary Care Reimbursement Service (PCRS) calculation of GMS payments to GPs per person has been reported at 12 per cent higher than the true figure over the 2007-2009 period.
• The 2011 OECD Health Data Report overestimates the GMS GP State income after expenses by 52 per cent.
But there also other mistakes in other Irish health-related reports:
• Central Statistics Office (CSO) Quarter 3 2007, Quarterly National Household Survey report under-reflects patient attendances, particularly in the over-65-year-old age group when compared to the equivalent UK General Household Survey, and audits of Irish local and UK national general practice administrative records.
• This CSO data, along with erroneous PCRS calculations, greatly alter the calculations in ESRI reports to cause an over-estimation of GMS payments per consultation by up to 47 per cent. The recent Irish Patients Association report over-estimates the cost of providing universal health insurance (UHI) by 42 per cent.
• Lastly, the March 2010 National Review of Out of Hours Services by the HSE, which compared HSE costs to the Northern Ireland equivalent service, failed to take into account the following:
o The five-times greater land mass covered;
o The 4.5-times more centres used;
o Double the over-70s population covered;
o The greater medical need of the under-70s with medical cards;
o The different payment structure for general practice in the UK;
o Differences in the rate of exchange and purchasing power parity; and
o All Irish State citizens are allowed access to the service.
To elaborate, the various reports I have concerns about include:
(a) The Primary Care Reimbursement Service (PCRS) Annual Accounts.
The PCRS Annual Accounts 2009 calculates the doctors’ payments per GMS patient at €337.94 when the applying of correct methodology to the same relevant data derives a sum of €295.99.
The same error has been made in previous annual reports because the PCRS calculation is based on the total of (GMS, including superannuation and benefits paid to retired DMOs + Mother and Child Scheme + Primary Childhood Immunisation Scheme + Methadone Scheme income)/(Total number of GMS patients — GP doctor visit patients).
My calculation is based on GMS (including superannuation and benefits paid to retired DMOs) income/total number of GMS patients.
(b) OECD Health Data Reports.
Irish self-employed GP remuneration statistics in 2011 OECD Health Data Reports based on information supplied to it by the Department of Health (DoH) are meant to reflect personal pre-tax income after all practice-related expenses for GMS GPs working full time. It calculates the average Irish GP with a GMS list in 2009 receiving an annual GMS income of €164,598 after expenses. This is based on an average gross income of €217,715 (not including benefits to retired DMOs) and results in an income-to-expenses ratio of 76:24.
The DoH calculates both out-of-hours and annual leave income as a personal income and not an expense. Also, the DoH assessment of costs does not adhere to the Department of an Taoiseach Regulatory Impact Analysis Guidelines on calculating staff costs, which has been endorsed by HIQA in its Health Technology Assessment Report.
This calculates Total Staff Cost = A. Mid-point pay range + B. 10.75 per cent Employer PRSI + C. Imputed pensions cost (typically 25 per cent of A but new levies have reduced that to 13.5 per cent of A for state employees) + D. Forty per cent of A in respect of ‘overheads’.
To give a good comparison to our data, three lines below the Irish remuneration figures in the OECD Health Data Report come the UK data. The most recent UK information comes from 2008 and shows the average contractor GP pre-tax income as Stg£105,300 (€122,876) based on tax returns. This figure comes from the NHS Health and Social Care Information Centre-produced GP Earnings and Expenses 2008/2009 Report.
Further analysis of that report will show that the average UK contractor GP gross earnings was £258,600 (€301,711) in 2008/09, with total expenses of Stg£153,300 (€178,900), resulting in an expense-to-earnings ratio of 59.3 per cent. This is in the context of the average list size of 1,408 patients for all UK GPs, excluding locums.
The 2006/07 UK GP Workload Survey found that the average number of sessions worked per week (normally defined as a half-day) was found to be 7.6 for the contractor GPs and 5.3 for the salaried GPs (average income £57,300 (€66,871)after expenses and before tax). GP partners held an average of only 87 surgery consultations per week, equivalent to an average of 11.7 minutes per consultation. In addition, they had an average of 17 telephone consultations.
The NHS funds a UK-salaried GP by three times the amount that the PCRS subsidises Irish GMS GPs to fund their medical cover costs. The cost of a salaried GP in the UK by daily rate works out at £503 per full day worked, which translates into about a daily rate of €636 once rate of exchange and purchasing power parity are taken into account. This was after total annual expenses of £6,700 (€7,818) for the year 2008/09 were taken into account. This compares very favourably to the current daily subsidy paid by the PCRS of €213.23 for locums, which has to also cover a 10.75 per cent employer PRSI payment if the locum has not formed a company and that sum of €213.23 also has to cover pension contributions, professional expenses and sick leave.
The UK data breakdown was interesting, with average office and general business expenses of £13,600 (€15,866); premises £17,400 (€20,292); employee £90,400 (€105,425); car and travel £1,500 (€1,749); interest £3,300 (€3,847); and in the case of non-dispensing practices, other expenses of £14,600 (€17,025).
Little of this is taken into account by the DoH when providing its own analysis of Irish GPs’ costs and net pre-tax income.
I have done my own analysis of PCRS GP payments data using OECD/UK guidelines, where practice costs are truly reflected. I have considered all fees as a true income, with the exception of the out-of-hours fees, as it has been well established in the 2010 out-of-hours report that there is considerable personal funding by GPs of deputising agencies, assistants and locums to provide the medical cover for the service. Many GMS GPs provide very little of their own out-of-hours (OOH) medical cover. (In the UK, many GPs opt out of the OOH service.)
I have considered all the allowances as a true expense, with the exception of the rural practice payments. I have doubled the fees received for locum expenses to reflect a more significant part payment towards the true expense of employing a locum, which is generally at least twice the fee paid by the PCRS and since 2009, sometimes there is an additional employer PRSI contribution of 10.75 per cent to be paid on top of that.
I have used the Regulatory Impact Analysis Guidelines — Basic Salary + Employers 10.75 per cent PRSI + 40 per cent Basic Salary in respect of ‘overheads’ to calculate a more realistic cost for the nurses and administrative staff expenses.
My final calculation for the total income in 2008 for the 2,098 GMS GPs after true total expenses was €229,469,490, or €109,375 per GMS GP, which is considerably less than the figure of €166,229 forwarded by the DoH to the OECD.
Issues worth noting are: the UK GP average list size is 1,404 patients and in 2008 the Irish GMS GP had 685 patients on his/her list. UK over-70 y.o. population comprises 11.5 per cent of the total list, when in Ireland the same age category make up 24.5 per cent of the list. Irish public patients under the age of 70 would be considered to have greater medical needs by virtue of them being eligible for a medical card than the average UK patient under 70. Having a bigger list/practice size confers economies of scale for the UK practices.
There were also the rate of exchange differentiation and the 2008 OECD 18 per cent purchasing power parity index difference between the two countries when considering all these figures.
(c.) Labour Party and Irish Patients Association estimates of the future costs of Universal Health Insurance.
The Labour Party health policy document extrapolates data from the ESRI 2010 Report – Evidence for the Expert Group on Resource Allocation and Financing in the Health Sector and estimates the cost at providing Universal Health Insurance (UHI) at €390 million. For work load estimates this assumes that CSO supplied data accurately reflects current GP attendance rates and that patients that are currently private but do not have a chronic illness will not attend any more frequently when they get a medical card. While the more recent Irish Patients Association (IPA) Review of the General Medical Scheme – Increased Work Load and Future Costs makes the claim that funding universal health insurance would cost the state an extra €844 million (€302.50 per person).
I believe that the true cost will be between these estimates. Based on current fees and demographics, in my opinion it would cost the state less than €597 million (€214 per person). I have based my calculation on CSO statistics indicating that there are 20,000 people who are currently over 70 who do not currently have a medical card. I have also calculated than for every 5,000 extra patients it will cost the state an extra €1 million and the cost for every 3,000 patients that move from under-70 to the over-70s medical card it will also cost the state an extra €1 million. Factors that need to be taken into consideration for costing extra medical cards that have not been considered in the IPA report include:
• The over-70s capitation fee is €280.31 while the under-70s capitation fee can be as low as €44.68 for males aged 5-15 years.
• Superannuation is directly related to capitation earnings (10%).
• Over-70s are potentially worth 3/1200 of an admin/nurse allowances when the under-70s are only worth 1/1200 of an allowance.
• Smaller GMS lists are more likely to use up their full allocation of allowances
• If universal health insurance were in effect there would be some natural economies of scale for the state
• Over 70s are greatly over represented in the influenza STCs
• Young children and the elderly will be over represented in the out-of-hours STCs.
• There is a small amount of fixed/discretionary costs in the annual budget that is not connected to the numbers of patients and therefore not expected to rise.
• In time, demographic changes will mean that a higher proportion of the national population will be over 70.
The IPA report starts very well by calculating the cost per patient using the same method that I have employed above, but then it extrapolates that the cost for every new patient on a medical card will be the same as the average cost pre-universal health insurance. Unfortunately, it does not take into account that currently the over-70s GMS patients make up about 8 per cent the national population but comprise 21.5 per cent of the total GMS population and result in 39 per cent of the total GMS costs based on extrapolating the above rates.
The 337,669 over-70 GMS patients probably cost the state closer to €576 per patient in doctors’ fees and allowances assuming my costing method.
The 78.5 per cent under 70 y.o. GMS population made up 61 per cent of the total GMS costs and probably cost the state closer to €221 per patient in doctors’ fees and allowances including fixed/discretionary costs.
If everybody was granted a medical card, over 95 per cent of current over-70-year-olds are currently covered => the cost to the state would be predominantly €212 per new patient if there mere no new over-70s medical cards, or €563 per new patient over 70 y.o. => final extra cost would be in the region of €592 million. In my opinion, the proposed €844 cost suggested by the IPA report over-estimates the final cost by c. 42 per cent.
For every extra 6,000 medical card patients that will convert from an under-70 to over-70-y.o. medical card it will have the effect of increasing the final average cost per patient by €1 or the total national cost by c. €2 million. However, as over-70s will comprise c. 20,000 of he new medical cards, the final average cost per patient will be c. €214, resulting in a final bill to the state of €597 million in total.
The Labour Party document under-estimates the final cost by 34 per cent due to using a different calculation method and under-estimating the increase workload associated with UHI.
(d.) CSO Quarterly National Household Survey Health Service Utilisation data in comparison to the equivalent UK General Household Survey, and also local audits of Irish general practice administrative records, QRESEARCH and PCRS data.
Another major theme to the IPA report is the extra resources needed as a consequence of a universal healthcare induced higher workload in primary care. The current workload estimation is based on extrapolation from the CSO Quarter 3 2007, Quarterly National Household Survey report looking at Health Status and Health Service Utilisation. The ESRI also uses this data for estimation of workload and combines it with PCRS data to assess payments per each patient. In my opinion, the CSO data analysis is very clever in determining the odds ratio of attending the GP depending on certain characteristics, but its method of data collection results in an underestimation of attendance rates, particularly in the elderly population. Also, it ignores contact with any of the 1,700 GP nurses (IPNA website calculation).
The CSO health consultations data was generated by an interviewer directly asking how many times the respondent had a surgery, domiciliary or telephone consultation (excluding telephoning for results) with their GP during the 12-month period prior to interview. The 2007 survey questioned 21,000 individuals.
It reported that across the state 69 per cent of the population questioned had at least one consultation with an average of 2.8 consultations per person (5.3 for GMS patients, 2.1 for non-GMS patients) in the previous 12 months. However, it also described how private patient GP attendance rates increase consistently from the 5- to 14-y.o. age group, but GMS attendance rates appear to peak in the 45- to 54-y.o. age group at 6.6 GP consultations per year then consistently decrease with progressive age to 5.3 GP consultations per over-70 year old patients. Intuitively this does not make sense.
Looking at UK data where the 2004 General Household Survey questioned 20,421 individuals, and the method of data collection was also a face-to-face interview where one of the questions posed was ‘Did the person talk to their GP for any reason at all, either in person or by telephone during the previous two weeks (excluding telephoning for results)?’ A similar question was asked regarding contact with the practice nurse.
Recollection of GP contact over the previous two weeks is clearly more reliable than recollection over the previous year. However, it does effectively reduce the sample pool of potential GP attendances by 96 per cent. The 2004 UK GHS found that GP contact consistently increased from the 5- to 15-year-old age group to 75+, with the exception of females over 75 years old appearing to attend marginally less than the 65- to 74-y.o. age group, but still more than the 45- to 64- y.o. category. Generally GP consultation rates were 6.5 per person in the 65-y.o.-plus category, which is a lot more than in the Irish CSO report.
QRESEARCH is a UK database that has over 30 million person years of observation from 525 practices spread throughout the UK. Its data is produced by direct analysis of general practice records. The percentage of QRESEARCH population aged 70 years and over at 11.84 per cent closely mirrors English census data.
Based on over 20 million consultations annually in more recent years it shows GP-only consultation rates increasing from 2.87 in 1999 to 3.44 per patient per year in 2009 (CSO 2007 data suggests the equivalent rate in Ireland is 2.8), with a much greater increase in nurse consultation rates from 0.96 to 1.9 in the same period. It shows a consistent increase in consultation rate with age.
QRESEARCH data analysis showed a total consultation rates per person years in 2009 of 5.1, reflecting in a rate of 4.3 for the under-70-y.o. population and 10.6 annual attendances for the 70-plus age group.
A joint audit of two Irish paperless group practices records, my own urban practice in Dublin 12 and the Red House Practice in Mallow, a mixed town/rural practice, produced results that were remarkably similar to the recent QRESEARCH data once the increased deprivation and rate of chronic illness associated with possessing a medical card along with the increased proportion of GMS population aged over 70 years old compared to the total UK population over 70 y.o. were taken into account.
This audit had a GMS population of 4,232 (once 122 nursing home patients were excluded as they were not on the IT system a full year) of which 2,981 were under 70 and 1,251 were over 70 years old. Some 29.6 per cent of the GMS population in this study are aged over 70 compared to 21.5 per cent of the national GMS population.
It had an estimated private population of 7,140 (unique private patient attendances in the study year / 0.67 in view of recent CSO data). This calculates as a population that is 37 per cent GMS and very similar to the national ratio.
Between the two practices the clinical staff consists of five full-time GMS principles, 1.75 assistants/locums and four full-time practice nurses.
I used the same criteria as QRESEARCH, 2004 UK General Household Survey and the CSO for calculating clinic contacts either directly from the appointment list or telephone calls and domiciliary visits from estimation of the minimal rates. I did not include approximately 25,000 patient annual contacts such as telephone calls looking for results, repeat prescriptions or other administration.
Our total private patient contact rate including visits to the GP or nurse, telephone consultations or domiciliary visits was 2.59 per patient per year (including patients who did not attend in the previous 12 months), and the total GMS contact rate was 7.24 per patient, resulting in a all patient contact rate of 4.37.
The total consultation rate in the under-70s is 3.63 with the rate in the over 70s being 9.42.
Analysis of our total GMS population shows a total consultation rate of 7.24 which is marginally more than the QRESEARCH rate of 5.1, but the difference would be accounted by the percentage of the QRESEARCH over 70 population being 11.84 per cent when in this two-practice study it is 29.6 per cent and the greater health needs assumed by virtue of our patients possessing a medical card.
Our rate of all annual consultations was 6.32 for our GMS under-70s, which is a population with much greater health needs than the UK equivalent age group that had a contact rate of 4.3 per person in 2009.
The rate of all annual consultations for our GMS over-70s, and the GMS covers 95 per cent of the Irish population, is 9.44 versus the 10.6 annual attendance rates in the UK over-70s. The QRESEARCH rate being higher can be possibly explained by them having a slightly older patient profile in the over-70s then we have in our population.
PCRS data for doctors on fee-per-item of service, which admittedly only covers a few GMS practices and by nature of the contract encourages patient attendances more than the capitation contract GPs, shows an overall visiting rate of 8.26 in 2009 and 9.59 in 2008.
This all shows that CSO data greatly underestimates general practice workload.
(e.) Competition in Professional Services General Medical Practitioners Report 2009a and the ESRI Report – Resource Allocation, Financing and Sustainability in Health Care: Evidence for the Expert Group on Resource Allocation and Financing in the Health Sector.
This Competition Authority and ESRI reports refer to an average payment of around €65 for every visit made by a public patient in 2008.
This sum is derived from dividing the 2008 Primary Care Reimbursement Service statistical analysis of claims and payments report sum of doctors GMS fees, allowances, superannuation and district medical officer related payments (€465,203,669) by the total number of full medical card patients and not including the DV medical card patients (1,352,120) to find the cost per patient (€344.05). Then dividing that sum by the CSO estimated 5.3 visits per GMS patient which clearly does not reflect the true workload, and results in the €64.91 payment per GMS visit.
The true cost per GMS patient per visit in 2008 terms should be calculated at GMS Fees, Allowances and Superannuation (€457,927,747) divided by the total number of all medical card patients (1,437,666) to give an annual payment per person of €318.52, which should then be divided by a number closer to my assessment of 7.24 visits per GMS patient per year, which gives a more realistic payment per visit of €43.99, which is 32 per cent less than the ESRI assessment. Or to put it the other way around, the ESRI assessment is 47 per cent more than then my assessment.
(f.) The March 2010 National Review Of Out Of Hours Services by the HSE.
This report compares the €107 million cost of running the national out-of-hours service and claims it is €90 million more expensive than the Northern Ireland costs of Stg£18.7-20 million without taking the rate of exchange difference or purchasing power parity into account.
It implies that the costs to run the service in the South should be similar to the North as the public populations covered are similar.
It does not take into account that the Southern service covers a landmass that is five times greater with 86 treatment/call centres versus the 19 centres in the North. There is a much greater degree of health needs associated with the Southern public patients by virtue of their eligibility for medical cards and the proportion of public patients that are aged over 70 years is twice the Northern Ireland proportion.
The NHS funds the full costs of providing a day-time primary care service unlike the GMS.
Also there is a moral duty of care for all citizens of Ireland despite the lack of contracts for a medical out-of-hours service to cover them.
Since this report there have been great reductions in direct GP funding for out-of-hours care with minimal reduction in the funding for the HSE associated costs.
I would appreciate it if you could assess my concerns and advise if the reason for all these incorrect calculations and material misstatements of facts are due to simple errors or do you perceive possible management bias in these publications? There does appear to be a clear consistency in HSE, DoH and PCRS data which consistently overestimates GP payments per patient and under-estimates the associated work load and costs of running the service.
This is on a background of a series of cutbacks in gross income despite a great increase in GMS numbers that are disproportionate compared to the reductions suffered by the rest of the public service and do not consider the final reductions in net income for us doctors. Over the same period, HSE management/administrative salary/superannuation costs that are reflected in the HSE 2010 Annual Accounts increased from €673 million in 2008 to €699 million in 2010 with a peak in 2009 despite the numbers of staff that have to be served reducing from 111,026 to 107,972 in the same period. Also HSE accounting policy is that pensions are accounted for on a pay-as-you-go basis, when GP payments reflect real and total costs.
My opinion on the CSO data is based on my disagreeing with their methodology alone and not with the integrity of the office, as is the case with the IPA and Labour Party reports. The ESRI data is victim of errors elsewhere.
The main intention of this letter is to request, could you please ensure that the obvious mistakes in the PCRS Annual Accounts are not repeated in future years? I also believe that the DoHC administered OECD Health Data calculation merits a significant alteration in its methodology.
Coherent health policy decisions should be made on analysis of fair, unbiased and competently produced evidence. Utilising the above reports as a resource to aid the decision-making about the funding levels of future primary care changes will only serve to unfairly disadvantage GPs. This will result in further undermining any trust GPs have in the HSE and will have consequences for their future engagement in primary care changes.
Dr William Behan,
Walkinstown,
Dublin 12.
About admin
Loading ...
