Fraud costing NHS £7 billion

Will Green is news editor of Supply Management
24 March 2014

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24 March 2014 | Will Green

Fraud and error is costing the NHS £7 billion a year, it has been claimed.

Researchers calculated global healthcare losses to fraud and error have increased by 25 per cent since 2008 from 5.59 per cent of total spend to 6.99 per cent.

A report entitled The Financial Cost of Healthcare Fraud 2014, produced by consultancy BDO in partnership with the Centre for Counter Fraud Studies at the University of Portsmouth, said if this was applied to the UK it would mean losses of £7 billion.

Mark Button, co-author of the report and director of the centre, said they had not broken down the figure into types of fraud but added: “A significant proportion of that figure would relate to procurement.

“We are moving towards a contractually-driven NHS with a mix of providers providing services with a financial incentive. In America, where that is a much stronger way of delivering healthcare, they have substantial evidence of fraud."

Button said the NHS had fewer than 300 fraud investigators, compared to 3,000 in the Department for Work and Pensions.

“The resources and people dedicated to countering fraud in the NHS have declined," he said. "At a time when I believe the risk has increased the simplest solution would be to try and enhance the resources again.”

The report, which collated data from around the world to produce its results, calculated the annual global cost of fraud and error in healthcare to be $487 billion (£313 billion), but a 40 per cent reduction in this figure was “possible within one year”.

The Department of Health said it did not recognise the loss figure, but a spokesman said: “These allegations are deeply concerning – fraud is a crime and we expect the NHS to take it very seriously.  That’s why anti-fraud specialists meet with trusts across the country to make sure they are tackling the issue. In 2012/13 alone there were over 450 criminal, civil and disciplinary actions following fraud investigations.

“NHS Protect, the organisation that leads work to tackle fraud in the NHS, has a multimillion pound annual budget and has recovered millions of pounds lost to fraud, bribery and corruption for the NHS. We have also put in place a cost recovery programme to make sure that we get the money for the world-class treatment visitors and migrants receive on our NHS.

“However, we know there is even more to do and in conjunction with NHS England we will be looking carefully at this issue over the coming months.”


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