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Global Health Care Fraud Tops $415 Billion, Expert Says at First World Anti-Fraud Summit Global Organizations Lose $415 Billion a Year to Health Care Fraud
Key Takeaway: A proactive approach to fraud, emphasizing outcomes over investigations, can reduce fraud losses by 40 percent in one year.
Next Steps: Organizations need to strengthen cooperation among national and international anti-fraud networks.
By James Swann
While public and private organizations around the world are losing $415 billion a year to health care fraud, adopting proactive fraud-fighting measures can reduce fraud losses by 40 percent within a year, a speaker said at the inaugural Global Health Care Fraud Prevention Summit in Atlanta.
The fraud figures were part of a report on international health care fraud, The Financial Cost of Healthcare Fraud, that was released at the summit.
Jim Gee, a co-author of the report and director of counter fraud services at PKF (UK) LLP, an accounting and business consulting firm in London, identified several keys to fraud reduction, including:
The report, from PKF and the University of Portsmouth in England, was based on an analysis of fraud loss percentages for 33 organizations operating in six countries (United Kingdom, United States, France, Belgium, the Netherlands, and New Zealand).
On average, 7.3 percent of the organizations' medical expenditures were fraudulent, the report said.
The Nov. 15 summit was sponsored by the Global Health Care Anti-Fraud Network (GHCAN) and held in conjunction with the National Health Care Anti-Fraud Association's Annual Training Conference.
GHCAN was founded by the Canadian Health Care Anti-Fraud Association, the European Healthcare Fraud & Corruption Network, the Health Insurance Counter Fraud Group, and the NHCAA.
Increase of International Fraud
NHCAA Chief Executive Officer Louis Saccoccio, who attended the summit, told BNA that "more and more, it has become apparent that health care fraud knows no boundaries."
Saccoccio said the "evolving global health care landscape creates a heightened need for international cooperation between organizations involved in the prevention, detection, investigation and prosecution of health care fraud."
Gee said that the global rise of health care fraud has led to an evolution in enforcement over the past decade, moving from a model that relied on reactive measures to one focused on preempting fraud.
That approach has helped organizations increase their resilience, and the more resilient an organization is, the less it will lose to fraud, he said.
In particular, the new approach has focused on outcomes, such as reducing fraud losses, rather than on activities, such as investigations into individual perpetrators.
Organizations have begun to measure the extent of fraud losses more accurately through the use of data mining data and statistical analysis, Gee said.
By James Swann
Reproduced with permission from BNA's Health Care Fraud Report, 15 HRFA 992 (Dec. 14, 2011). Copyright 2011 by The Bureau of National Affairs, Inc. (800-372-1033)
Released November 15, 2011
Today, PKF (UK) LLP and the Centre for Counter Fraud Studies at University of Portsmouth publish a major report concerning the financial cost of healthcare fraud. It is being launched at the first ever Global Healthcare Fraud Prevention Summit in Atlanta, U.S.
The Report, with a Foreword from Dr David Evans, the Director of Health Systems Financing for the World Health Organisation and a Preface from Paul Vincke, President of the European Healthcare Fraud and Corruption Network, shows that an average of 7.29% of healthcare expenditure is being lost to fraud (and error) each year, up from 5.59% when last reviewed in 2009. This equates to £260 billion (US$415 billion) globally. The report describes how these losses take place and highlights the additional resources which could be spent on patient care by enhancing the fraud resilience of healthcare organisations.
You can download a copy of the report by clicking here. For more information you can email jim.gee@uk.pkf.com or visit the counter fraud services web pages, which contain several other reports and much useful information.
Media Contacts: United States
Leigh McKenna
Director of Government & Public Affairs
Phone: 202.349.7987
Email: LMckenna@nhcaa.org
Credentialed media interested in attending the Global Health Care Fraud Prevention Summit must pre-register. Please direct media inquiries to:
Leigih McKenna, Director of Government & Public Affairs
202.349.7987
Email: LMckenna@nhcaa.org