The new head of the HSE acute hospitals section has warned hospitals their costs are running at unsustainable levels and must be tackled urgently.

Dr Tony O'Connell, national director of acute hospitals, has told hospitals there was a 'lack of visibility' on targeted savings so far this year.

He said three-quarters of savings that acute hospitals claimed they had made did not stand up to scrutiny, according to a report in the Irish Times.

There had been a generally poor response to requests from HSE for hospitals to submit cost containment plans, Dr O'Connell stated in a letter to hospitals.

At the start of the year, the HSE said acute public hospitals would have to make do with nearly €250 million less in funding in 2014.

Health Minister James Reilly admitted this week that €108 million targeted for health service savings this year will not be achieved.