Consultants excluded from 15% voluntary pay cut….
It was reported in the Irish Times (24 June 2011) that hospital consultants and or their representative bodies lobbied the minister for health, James Reilly, so as not to be included in the 15% voluntary pay waiver announced by Minister of Public Expenditure and Reform on Wednesday last (22 June 2011). This was refuted by both a spokesperson for the Minister of Health and the Department of Public Expenditure and Reform (known as PER). So why are consultants excluded and who earns what in the public health system?
It is impossible to get a figure from the HSE as to how many people on its payroll of just under 106,000 staff earn over €200,000, an extraordinary fact in itself. It is some what explained by the fact that there are still 17 different pay roll systems in the HSE but also that many of these 106,000 are not direct staff of the HSE but people who work for voluntary hospitals or large voluntary agencies. Why on earth seven years into its existence the HSE has not managed to merge the pay roll systems remains an unanswered question.
However, it would appear that not very many of the 106,000 workforce earn more than €200,000 from the public purse. Lets start outside of the HSE with the Minister, as a result of various different pay cuts, he now has a salary of €169,000.
Michael Scanlon, the secretary-general in health, as a result of the most recent voluntary cut (on top of the previous pay cuts) is now paid €200,000 exactly, although he will still get his pension at his previous rate – see article linked to earlier. And according to the Department of Health no one else in the department or in any of the agencies directly funded by them is paid over €200,000.
HSE chief Cathal McGee took up post last year with a €322,000 basic salary, with no bonus, but a car allowance of €13,800. Yesterday, he confirmed he was happy to take the 15% voluntary reduction which leaves him with a salary of €280,000, signficantly above that of the minister. According to the HSE none of the National Directors earn over €200k ( the highest band starts at €183k).
And again according the the HSE, most consultants don’t earn over €200k FROM THEIR PUBLIC WORK – an important distinction as many earn significantly more than this when their public and private earnings are combined. Pay for consultants on type A contract on which they can only work in the public system ranges €176-196,000, while those on Type B who are allowed to work privately their sarlaries start between €146-158,000 however they can earn multiples of that from their private work – see below.
Tracey Cooper, HIQA CEO, earns around €170-180k. The CEOs of the voluntary hospitals earn less than €200,000 from the public purse according to the pay scales but some receive top up payments from the ‘research fund’ of their hospital.
Jimmy Tolan – the current VHI CEO, is the super high net earner in the health sector – his “total remuneration including pension paid to CEO to December 2010 amounted to a salary of €411,420 and performance related pay of €37,500”. That means he was paid the bones of €450,000 last year. He opted out of a bonus for 2011 (all semi state CEOs were asked to by government). When asked was he taking 15% waiver, I was told he already has taken a 40% pay cut from his original package worth €665,320 including pension and bonuses – he resigned in May but is in post til November. His salary is a multiple of the current minister. Figures published by PER yesterday say the starting salary of the new CEO to be recruited to replace Tolan will be €191k, a fraction of its predecessor’s.
So why is it so hard to know how much hospital consultants earn? 70% of those who work in the public system are allowed to work privately – with a cap of 20-30% of their workload although a minority far exceed that ratio. And while it is hard to get actual figures on their public salaries, it’s impossible to get definitive figures on their private incomes.
HSE figures released for this article say that “27 non academic hospital consultants earn more than €250K”, these are often clinical directors who maybe towards end of career, so they get an additional €50k for the clinical director post and would usually be on quite a high salary scale due to years of service.
The HSE could not give a figure for the numbers of consultants paid more than €200k. Many of the academic posts eg a professor in a university and a consultant could earn over €200k but it might be €180K from HSE and however more from the university.
Incredibly, the consultants earning over €200,000 are not included in the 15% voluntary waiver introduced this week. James Reilly spokesperson said the matter was “still being brought to cabinet table” and “still in discussion as part of Croke Park”. The response from the Dept of Public Expenditure and Reform was similar but different, “The same objectives are being pursued by minister Reilly in relation to hospital consultants through a separate process which is ongoing”.
But there was general consternation that consultants were not included in the waiver as they are the highest earners in the health sector. And rumour abounded that the Minister had been lobbied by consultants to that effect. There was a rare and surprising silence from bodies representing the consultants on this issue.
So can we estimate consultants’ total income – their public and private earnings? No one has those figures except Revenue but in order to get a ballpark figure for Type B contracts who are allowed to practice publicly and privately, one would need to add up their public salary, money paid to them by insurance companies and money paid directly to consultants by people out of pocket for private care. And there is no way of collating that.
When asked how much they paid to conultants, the VHI said it was commerically sensitve and released a statement on this saying that ‘We pay fees to over 2,300 consultant of which the average payout in 2010 was approximately €98,000 per consultant . 70% of consultants were paid less than €100,000 and 6% (138) paid more than €300,000. But that does not include their public income nor what they get from other insurance incomes plus money paid out of pocket and other earnings eg evidence in legal cases etc..
And earlier in the week news broke that some of these consultants who work privately and publicly are in trouble with the HSE for far exceeding their private workload as agreed in their contract.
The background to this is that a new hospital consultant contract was agreed in 2008 and is in place since 2009. Under this contract for the first time consultants are measured for public and private work. For the last two years, the HSE has been working with consultants carrying out more than 50% private work to reduce it, to verify the measurement tool and if not reduced the HSE issued a fine to these consultants.
Now, it is the end of the long two year process and this week 17 letters have been issued telling the worst offenders that as of 16 September that “their private practice will be suspended with effect of that date (16 Sept) and we will withdraw the clinical indemnity provided in respect of your private practice”.
And although those numbers exceeding the 20/30% private practice is not widespread, it is extremely significant that the HSE is taking them on in an attempt to level the playing field for public patients. We do not know much about who they are, what type of specialities, where they are except that many are in Limerick and Cork.
The IHCA on behalf of the consultants reject the HSE measurement of their public and private work, several attempts were made to contact both consultants’ representative bodies (IHCA and the IMO) today and their silence is deafening.