The audit office report about the state health services, Okypy, which was discussed at the House health committee on Thursday, must be seen as a red alert, an urgent warning that public hospitals are destined for a collapse. All the numbers show quite emphatically there is no way the public hospitals could become financially viable entities after May 31, when state support, according to the law, would be terminated. It should have been terminated last year, but public hospitals were given an additional year of state support, although everyone knows nothing will have changed.

How could it, when the Okypy model is a freak creation of the politicians, primarily designed to serve workers. First, Okypy has no control over the remuneration of 75 per cent of its employees, who remain public employees. Second, public hospitals operate under public service rules, which are both restrictive and costly (overtime pay for all work outside public service office hours and regulations for excessive numbers of staff). Third, a costly bureaucracy, with different tiers of management, has been created to manage operations. All the above lead to 80 per cent of annual expenditure going on the payroll, leaving very little money for investment in improving facilities or new medical equipment.

It suffices to say that in 2022, the period covered by the audit office report, out-patient visits at public hospitals fell by a staggering 50 per cent, while in-patient admissions were down by 20 per cent. Auditor-general Andreas Papaconstantinou said, “we are worried by the fact that although work, in terms of patient care, is declining, the number of doctors and nurses is increasing while for the administration it is increasing even more.” In short, Okypy – perhaps under pressure from the government – is doing the exact opposite of what is needed to make public hospitals financially viable and self-sufficient. It is increasing its employee numbers (and payroll) while it is serving fewer people and generating less revenue. This is a formula for bankruptcy.

The idea that public hospitals would become competitive is from the world of fantasy, considering it has recorded deficits ranging from €50m to €150m in the last three years, according to the audit office. Meanwhile, in keeping with the economic irrationality dictated by the unions, doctors are receiving bonus pay even though they are seeing fewer patients. Apparently, of the €19m allocated for pay incentives, €16m is paid to all the doctors, regardless of performance and productivity! And the doctors’ union Pasyki was threatening to strike on the grounds that its members had not received the extra ‘incentives pay’ for 2023. In public hospitals doctors get pay bonuses irrespective of performance and productivity, because the union is in charge.

Okypy executives told the committee there was a “culture problem” at the hospitals. Apart from the waste, there were no controls, no discipline and no punitive measures. In short it was a ‘free for all’ culture just like the rest of the public sector and the Okypy management could not make the necessary changes, because it invariably comes up against the reactionary unions.

Public hospitals that are wasteful, grossly overstaffed, and have a constantly rising payroll will never be self-sufficient, let alone competitive. As things are, it is only a matter of time before the system collapses, because the taxpayer will not be able to fund the Okypy black hole indefinitely.