Cutting funds puts Gesy viability in danger, says HIO (updated)

By Nick Theodoulou and Gina Agapiou

Knives are out in the Gesy row after the finance ministry drew its scalpel and trimmed €150m from the Health Insurance Organisation’s (HIO) budget, prompting opposition Akel to accuse it of seeking to undermine the health care system.

A fiery debate in parliament on Thursday blazed into Friday as Akel MP Giorgos Loukaides accused Finance Minister Constantinos Petrides of “strangling” Gesy, following the latter’s warning that it could collapse unless major restructuring takes place.

“The vast majority of the public understands that Gesy is in its infancy and requires our help so that it can stand on its own two feet and not to kill it, as is the aim of its sworn enemies,” Loukaides said on Friday.

His comments came as the HIO slammed the ministry’s “unilateral” move to cut €150m from its budget, which the organisation said was suddenly announced half-way through Thursday’s discussion in the House watchdog committee.

But Petrides hit back on Friday afternoon, saying that nothing has been cut. He reasoned that the funds represent expenditure covered by the health ministry.

According to the law, Petrides explained, those costs must be recovered from the wider Gesy budget and this is what the health ministry had done in consultation with the finance ministry.

He further said that Disy has done more than any other party to secure Gesy and had ensured its implementation in the first place.

Greens MP Stavros Papadouris supported the finance minister’s decision. He said the AG’s report has identified abuses in the operation of the HIO and the Auditor General would refer the issue to the Attorney General’s Office.

The intention to cut funds from the HIO is justified, Papadouris said, as these are payments that the HIO cannot cover and are eventually passed on to the health ministry.

Petrides said the finance ministry “does not control” the finances of HIO, which not only does not balance its budget but a series of medical services are not offered by Gesy and get saddled onto the finance ministry – that is, transferred to taxpayers.

The finance minister centred his arguments on the auditor general’s scathing report, released earlier this month, which highlighted alleged illegalities on part of the HIO, along with systemic overspending and incompetence.

“[At the House watchdog committee on Thursday] I did nothing more and nothing less than agree with the findings of the auditor general and I support his recommendations.

“Therefore, according to Loukaides, is the auditor general also an enemy of Gesy?” Petrides replied.

Reports on Friday suggested that the AG’s office will soon submit its report to the police.

For its part, HIO president Thomas Antoniou told state radio that the budget cut will not be accepted, warning that this will destabilise Gesy. It is the state that owes the HIO and not the other way around, Antoniou said.

Petrides’ warning on Thursday that Gesy will collapse unless major restructuring takes place put a target on his back, with many criticising him; and the government more widely, of not wanting the national health system to succeed.

Many in opposition see ulterior motives, claiming that some secretly desire to privatise sectors of Gesy.

But Petrides has said that Gesy is on a trajectory to fail on its own – if current practices continue; and he attributed the situation to the HIO, the entity charged with running Gesy, with not properly enforcing the relevant legislation.

“Those who refuse to implement the philosophy and architecture of Gesy, are leading it to collapse sure as night follows day,” he told MPs on Thursday.

Unless remedial action is taken, Petrides said, inevitably contributions to Gesy would need to go up by 20 to 30 per cent if the system is to “survive”.

Earlier this week, senior HIO official Angelos Tropis said that Gesy’s expenditure for 2021 was €1.21bn.

Health Minister Michalis Hadjipantelas conceded that problems and abuses exist within Gesy and that previous contracts signed with private healthcare facilities for the same surgeries have different prices.

The chairman dismissed the notion that the organisation’s contracts with private hospitals and clinics were unlawful.

Hitting back, he said that HIO board includes people from the ministries of finance and health, who did not object to these contracts. The contracts were also signed off by ex-Health Minister Constantinos Ioannou, he claimed.

A meeting of the HIO board of directors in the presence of the health minister will be held on Tuesday, focusing on the abuses of the health scheme and ways to reduce them.

According to the health minister, in the new contracts with private healthcare facilities, the provision of the relevant legislation would be implemented – namely prohibiting the exercise of private medical practice in facilities enrolled with Gesy.

The contracts will be forwarded to the attorney-general for vetting, ensuring that all healthcare providers are treated equally.