Will the taxpayer ultimately have to pay for the Tallaght Hospital overdraft?

Hawkeye123

Last week it was reported that Tallaght Hospital was to be extended a 12 million overdraft by AIB because it had overspent its budget.This raises the question, what about next year – will they get another 12million from the state owned bank if they overspend again? If so who will payfor it? If the taxpayer has to pay it then the net effect is that Tallaght Hospital did not play its part in the austerity. This raises another question,if the Tallaght hospital was located in some other part of the country – would it have gotten special treatment or is that only for Dublin based hospitals.

Is Tallaght Hospital realistically likely to make a profitnext year (or ever) to pay AIB back? If not, why on earth would AIB extend such an enormous overdraft to that hospital? What possessed the management at that bank to do such a reckless thing, especially when they are trying so desperately to rebuild their balance sheets to the point where they will not even lend to legitimate businesses that operate in the real world. Are AIB expecting the great white elephant to suddenly sprout wings and fly? If Tallaght hospital can avail of overdrafts – who is to say that every other bit of the public sector will not attempt to do the same when funding is reduced?

Finally – shouldn`t someone tell the troika about this development? Im sure it would be of interest to them.

thebman

Troika don't care, government just see votes. Everyone else, pays the bills.

Geuze

Overdrafts are not unique to this hospital.

AFIAK, Sligo Co. Co. have a 10m overdraft.

bbam

Hawkeye123 wrote: »

Last week it was reported that Tallaght Hospital was to be extended a 12 million overdraft by AIB because it had overspent its budget.This raises the question, what about next year – will they get another 12million from the state owned bank if they overspend again? If so who will payfor it? If the taxpayer has to pay it then the net effect is that Tallaght Hospital did not play its part in the austerity. This raises another question,if the Tallaght hospital was located in some other part of the country – would it have gotten special treatment or is that only for Dublin based hospitals.

Is Tallaght Hospital realistically likely to make a profitnext year (or ever) to pay AIB back? If not, why on earth would AIB extend such an enormous overdraft to that hospital? What possessed the management at that bank to do such a reckless thing, especially when they are trying so desperately to rebuild their balance sheets to the point where they will not even lend to legitimate businesses that operate in the real world. Are AIB expecting the great white elephant to suddenly sprout wings and fly? If Tallaght hospital can avail of overdrafts – who is to say that every other bit of the public sector will not attempt to do the same when funding is reduced?

Finally – shouldn`t someone tell the troika about this development? Im sure it would be of interest to them.

You talk of the hospital making a profit next year, what do you mean..

And yes... id fully expect the tax payer to pay the bill, I presume the overdraft is to carry them over until their next funding, see it as a means of averaging out their access to funding..

NIMAN

They won't close hospitals just cos they overspend, so simple answer, yes.

Head The Wall

Donegal is 12.7 million but seemingly these are figures from 2010 only published recently. What are the current figures like?

thebman

bbam wrote: »

You talk of the hospital making a profit next year, what do you mean..

And yes... id fully expect the tax payer to pay the bill, I presume the overdraft is to carry them over until their next funding, see it as a means of averaging out their access to funding..

lol until the game is up and they can't pay the overdraft with next years funding...

Then what is the plan?

whenever

NIMAN wrote: »

They won't close hospitals just cos they overspend, so simple answer, yes.

I'm curious how a hospital with an unrestricted A&E unit can operate to say to within say 5% of a budget. Should hospitals be permitted to go 'off call' for a period to reduce their expenditure?

GCU Flexible Demeanour

whenever wrote: »

I'm curious how a hospital with an unrestricted A&E unit can operate to say to within say 5% of a budget. Should hospitals be permitted to go 'off call' for a period to reduce their expenditure?

But, sure, if the level of ED attendances was utterly unpredictable they'd have no idea how many staff should be rostered.

And, for what its worth, the number of ED attendances has been falling since 2008. The number in 2011 was lower than the number in 2007; so the demand-led element of hospital service planning isn't growing.


(Table 11 on page 41 of this:
http://www.hse.ie/eng/services/Publications/corporate/annualreport2011.pdf)

Kurz

Why on earth wouldn't the taxpayer pay for the funding of this hospital? Who do you want to pay for it?

Fair enough there are a lot of inefficiencies in some of the hospitals but if we're talking about a state-funded bank providing an overdraft to a hospital then it's not really a situation where we should complain about where revenue is going.

We need a proper health minister who can make hospitals run properly without the need for this.

golden lane

people must pay for hospitals.....one way or the other....

Victor

Tallaght is a voluntary hospital, not owned by the state (the state will have certain protections as it grant-aided the development of the hospital), so the state won't be paying directly. However, yes, the state will ultimately pay - just like the customers of any business ultimately pay for any overdraft the business has.

whenever wrote: »

I'm curious how a hospital with an unrestricted A&E unit can operate to say to within say 5% of a budget. Should hospitals be permitted to go 'off call' for a period to reduce their expenditure?

Actually, it seems that A&E admissions are somewhat predictable, insofar as over a month, you know how much staff and materials you will need. Yes there will be variations, but those variations are tolerable.

Kurz wrote: »

We need a proper health minister who can make hospitals run properly without the need for this.

The position of health minister is a poisoned chalice. There is no magic solution.

Head The Wall

golden lane wrote: »

people must pay for hospitals.....one way or the other....

Yes, that is true but people will wonder how these hospitals seem to be running over budget by so much every year. If they know they can't meet their budgets they need to stand up to the minister and tell him it's just not possible with the systems in place.

juan.kerr

Hawkeye123 wrote: »

the net effect is that Tallaght Hospital did not play its part in the austerity.

Hawkeye123 wrote: »

Is Tallaght Hospital realistically likely to make a profitnext year (or ever) to pay AIB back?

:rolleyes: Ridiculous post. Since when did public hospitals 'make a profit'?

GCU Flexible Demeanour

juan.kerr wrote: »

:rolleyes: Ridiculous post. Since when did public hospitals 'make a profit'?

In one way, I know what you mean. On the other hand, doesn't the system operate on the basis that 25% of patients will be private.

And, at present, half of those private patients don't pay for the bed, because it may be formally designated as public. Legislation was promised last year to deal with this, but nothing has been done since. If we want to avoid overdrafts for public hospitals, this is a potential source of income which is not being pursued.

http://debates.oireachtas.ie/dail/2011/12/14/00230.asp

Written Answers - Hospital Charges

Wednesday, 14 December 2011

Minister for Health (Deputy James Reilly):<...> It is intended to introduce new legislation next year to allow public hospitals to raise charges in respect of all private patients in public hospitals. <...> It is estimated that an additional €200m per annum would arise, for which €75m has been anticipated next year as given the need for legislation, a full year effect will not apply until 2013.

Victor

juan.kerr wrote: »

:rolleyes: Ridiculous post. Since when did public hospitals 'make a profit'?

'Profit' may not be the correct word, but they should normally make some sort of surplus, so as to contribute to reserves.

thebman

juan.kerr wrote: »

:rolleyes: Ridiculous post. Since when did public hospitals 'make a profit'?

Nobody is asking them to make a profit, breaking even would be nice ...

Hawkeye123

bbam wrote: »

You talk of the hospital making a profit next year, what do you mean..

And yes... id fully expect the tax payer to pay the bill, I presume the overdraft is to carry them over until their next funding, see it as a means of averaging out their access to funding..

Hello bbam - let me explain. The troika have given guidelines to the government and the government are supposed to apply the necessary austerity. To that end, Tallaght hospital has a budget that it is supposed to adhere to. It hasn`t done so but by some miracle it was given a 12 million euro overdraft by an insolvent bank (which is now owned by the state). That is the context of this thread bbam.

Hawkeye123

juan.kerr wrote: »

:rolleyes: Ridiculous post. Since when did public hospitals 'make a profit'?

Hello juan.kerr. Assuming the hospital avails of the overdraft which AIB is making available to it - then one would resonably expect the hospital to pay this money back. If the hospital does not make a profit - how will it pay the money back? From the tone of your post I deduce you have issues with the concept of making a profit and while that is a separate matter I would point out that jealousy is a very unhealthy emotion to harbour. Food for thought since the preservation of health is of vital importance in a country in which hospitals squander taxpayers money in such an unsustainable way.

creedp

Hawkeye123 wrote: »

Hello juan.kerr. Assuming the hospital avails of the overdraft which AIB is making available to it - then one would resonably expect the hospital to pay this money back. If the hospital does not make a profit - how will it pay the money back? From the tone of your post I deduce you have issues with the concept of making a profit and while that is a separate matter I would point out that jealousy is a very unhealthy emotion to harbour. Food for thought since the preservation of health is of vital importance in a country in which hospitals squander taxpayers money in such an unsustainable way.

Simple answer it will pay it back from 2013 and then try and make cuts/savings in 2013 to stay with a reduced 2013 funding base. I'm not sure what jealousy has got to do with anything here! Why does everything have to dissolve into into the public -v- private argument even where it has absolutely no applicability to the discussion!

Public hospital don't make profits - they are not required to build up reserves. They operate within the confines of an annual allocation from the State unless they have a side show providing some private service for which they can generate an income stream and earn a profit from that. Bottom line Tallaght Hospital overspent in 2012 to the tune of €12m. Without the overdraft, the hospital would effectively shut down for the remainder of the year. Bit silly that option given that staff would contine to be paid!

Hawkeye123

creedp wrote: »

Simple answer it will pay it back from 2013 and then try and make cuts/savings in 2013 to stay with a reduced 2013 funding base.

Thank you for answering the initial question asked in this thread. If you are right - Tallaght Hospital will not only have to spend 12 million less next year, it will also have to pay interest on the 12 million it borrowed this year and presumably make a least some nominal contribution toward paying down the 12 million. That will require efficiency! What a culture shock Tallaght Hospital is in for! I`m not saying you are wrong creep - in fact I hope you are right. That said, I still think it is very suspicious that they got this 12 million overdraft from an insolvent state owned bank - a bank that will not even lend to viable profit making businesses which opperate in the real world. Anyone would think someone guaranteed they would get the 12 million back - I wonder who that could be minister O`Reilly.

[Jackass]

Thread Title: "Will the taxpayer ultimately have to pay for the Tallaght Hospital overdraft?"

Unless business really picks up in the gift shop, of course they will. Who else would?

Victor

creedp wrote: »

Public hospital don't make profits

Note that Tallaght Hospital is a private charity - it isn't owned by the HSE.

[Jackass]

Probably gets massive funding from it though. I doubt a charity could raise enough money to pay for all of the equitment, let alone all the staff, who are more than likely HSE employees and probably where the majority of overspends are incurred...

creedp

Victor wrote: »

Note that Tallaght Hospital is a private charity - it isn't owned by the HSE.

You are correct but it is my understanding that it is almost exclusively funded by the HSE so other than in terms of legal ownership it is by default a publicly funded hospital which is required to remain within its annual allocation from the HSE. As for guaranteeing the overdraft, AIB knows that come January the 2013 funding stream will commence and the O/D will be paid down. I'm sure that's a precondition!

Hawkeye123

creedp wrote: »

As for guaranteeing the overdraft, AIB knows that come January the 2013 funding stream will commence and the O/D will be paid down. I'm sure that's a precondition!

I wonder what Tallaght Hospital used as collateral - the hospital perhaps. That sounds like public private partnership in reverse. Still, it is very strange that AIB would give such an enormous overdraft to Tallaght Hospital. A more likely senario is that AIB were guaranteed repayment from the government.

Victor

Hawkeye123 wrote: »

A more likely senario is that AIB were guaranteed repayment from the government.

This was stated in the news reports.

Icepick

Victor wrote: »

just like the customers of any business ultimately pay for any overdraft the business has.

obviously not true for private businesses

Hawkeye123

Victor wrote: »

This was stated in the news reports.

Well then, sinse the state guaranteed the overdraft - it is probable the state will end up paying for it. This is a continuation of past policies - live today pay tomorrow.