Billions of EU subsidies have contributed to improving the quality of healthcare in the regions. However, some hospitals purchased unnecessarily expensive or redundant equipment

Press release on audit No 22/04 – 6 February 2023

The SAO examined how the Ministry of Regional Development (MoRD) and the Centre for Regional Development of the Czech Republic (CRD) spent EU funds from the ‘Integrated Regional Operational Programme’ and funds from the State budget on aid for regional healthcare infrastructure between the years 2014 and 2022. In total, CZK 7.5 billion was spent over this period. According to the auditors, the vast majority of the funds provided for the projects examined was used effectively and economically and the medical equipment procured contributed to improving the quality of healthcare in the regions. However, the SAO also identified some shortcomings. The MoRD did not set measurable objectives for the beneficiaries of the subsidy, nor did it assess the effects of the aid provided, therefore it did not have information on the benefits and outcomes of the projects. The initially approved aid for beneficiaries in individual regions was unbalanced. Some hospitals purchased unnecessarily expensive or redundant equipment, so they did not behave in an entirely cost-effective manner.

The SAO pointed out that although the provided aid was expected to reduce the number of acute healthcare beds by 13% to the target of 38,368 beds at the end of 2023, the values reported on an ongoing basis indicate the opposite. While in 2014 there were 44,211 beds, the number increased slightly to 44,408 in 2020. In view of these developments, there is a risk that the target will not be achieved.

The aid was intended, inter alia, to enable access to quality health services in all regions. However, the issue of regional inequalities in the quality and accessibility of healthcare was completely neglected by the MoRD when preparing the conditions for the calls. Aid for the healthcare sector in the regions was unbalanced during the initial distribution of subsidies in 2016. While the MoRD allocated money to all the projects of hospitals in five regions who had submitted their applications earlier, for example the Pardubice Region Hospital would have remained entirely unaided as no subsidies were left for it. Moreover, only one fifth of the requirements of hospitals in the Ústí nad Labem Region would have been met. The MoRD did not remedy the situation until March 2019, less than two years before the end of the 2014-2020 programming period, only by shifting free resources from another operational programme where EU funds had not been absorbed.

The SAO reviewed eight hospitals – selected beneficiaries of subsidies – for which it examined a total of 16 projects representing dozens of purchases of medical equipment. Most of the projects which received aid from the Ministry of Regional Development did not have a specific and measurable objective to be achieved by funding. Projects with vague objectives such as “enhance the economic and social development of the city” or “increase the public’s positive perception of health service providers” were approved for aid.

One of the evaluation criteria for awarding a subsidy was also demonstrating the necessity of the project. However, this was assessed only formally by the CRD, therefore there was no guarantee that the subsidy would be used for genuinely necessary activities. This is illustrated by examples from the Vyškov Hospital and the Jihlava Hospital, which asked for a subsidy to purchase a total of seven operating tables with a load-bearing capacity of 360 kilograms or more – naturally this equipment is more expensive than the standard operating tables. The reasons for the request were an increase in the number of patients with morbid obesity. However, none of the hospitals reported how many patients with a weight of over 250 kg they operated. Furthermore, none of the hospitals purchased special beds and equipment, nor did they make the construction works needed to take care of morbidly obese patients. The question is, therefore, whether one such overdimensioned operating table would not suffice for each hospital. Therefore, the auditors assessed these purchases as being of limited economic value. Similarly, the SAO critically assessed the purchase of a second mobile anaesthesiology machine for magnetic resonance by the Liberec Regional Hospital, although it already had one and was sufficient for the hospital’s needs due to its low use. In total, around CZK 26 million was spent on these purchases of medical equipment with limited cost-effectiveness.

During the audit of selected projects, the SAO did not detect undue use of aid, breach of public procurement rules or non-compliance with other legislation. On the other hand the SAO considers that there was a lack of effectiveness in the use of public funds on the part of the Česká Lípa Hospital which had started using a newly acquired magnetic resonance machine only after ten months from the purchase.

Communication Department
Supreme Audit Office

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