The NHS and Fraud: Trusts should be required to act

Back in May 2011, 2020health published a report on the issue of fraud in the NHS: Stealing the NHS. For all the talk since about reducing the costs of NHS care, making efficiency savings and value  for money, there has been a consistent opportunity which is notable by it’s absence: Reducing fraud.

Today sees the publication of an excellent and timely report produced jointly by PKF and the Centre for Counter Fraud studies at the University of Portsmouth and supported by 2020health and the European Healthcare Fraud and Corruption Network. It details some of the ways in which the NHS is being fleeced of money intended for treating patients:

• Doctors charging for phantom procedures
• Patients lie about economic circumstances
• Contractors defrauding NHS supply chain
• Bogus doctors and fake expenses

One example was of a one Chief Executive Office who over-claimed on his mileage allowance by 55,000 miles! The report reveals that the total cost of fraud could be £3 billion per year or more. Yet the report’s authors argue that reducing fraud losses is one of the least painful ways to improve efficiency because tackling fraud incurs very little cost when compared with expenses such as procurement, staffing and utilities. Seventy-nine exercises were undertaken over a 11 year period to accurately measure healthcare fraud and error losses. 100% of the exercises showed percentage loss rates of more that 3% with more than 4 in 10 showing losses of over 8%, with an average of 7%. On the NHS budget, this would translate to £7Bn per year being lost to fraud. This is an astronomical loss and whether we’re talking about patients abusing the prescription service or hospitals claiming for phantom operations, the total cost of fraud within the NHS is an eye-watering amount.

One of the report’s lead authors, Jim Gee, Director of Counter Fraud Services at PKF, knows what he is talking about. He was the former Director of Counter Fraud Services for the Department of Health and points out that the NHS has been tasked with finding efficiency savings of £20 billion over the next few years, so minimising fraud has the potential to improve the quality of healthcare for everyone in this country.
Unbelievably at present, NHS Trusts are only required to demonstrate that someone is responsible for countering fraud, but they are under no obligation to provide details of how successful they are or to publish information relating to fraud and its costs. With the economy under huge pressure and the NHS being asked to find significant savings, it’s madness for the government not to insist that NHS Trusts take this subject in a much more serious and open way that inspires the confidence of the public.