Health care fraud costs 'at least' $26 billion annually: report
Date: Tuesday, September 27 2005
Topic: Canadian News
Canadians are losing $26 billion per year to health care cheaters, says a new report released Thursday.
The study, prepared by Fraudbox, an insurance and institutional fraud investigation service, was presented to health care administrators, insurance companies and government officials attending an international health care conference in Niagara Falls.
The study asked health care insurance companies to report cases of claims that:
* Billed for services not rendered.
* Billed for drugs not dispensed.
* Filed a fraudulent insurance claim.
* Inflated costs.
* Deliberately applied medically unnecessary services.
The report defined health care fraud as an scheme involving the health care industry and that is "designed for illegal financial gain."
"It's a Pandora's box," Joel Alleyne of the Canadian Health Care Anti-Fraud Association told the CBCUnlocked French service. The report is a "snapshot," he says, and it appears to reveal only the tip of the iceberg.
The deeper you look, he says, "you find more and more fraud."
Ironically, the report suggests that commercial health care service suppliers are the largest group scamming the system, followed by individuals who submitted false claims.
Much of the fraud was uncovered almost by accident, when insurance adjusters noticed discrepancies in claims documentation or missing receipts.
Insurance companies are only now getting a handle on how big the problem is, says the report. Alleyne said what's needed is more corporate commitment to prevent and eliminate fraud.
* One-third of those surveyed said there was little corporate understanding of the depth of the problem.
* One-third said there seemed to be a lack of executive commitment in their company toward rooting out fraud.
* One out of four respondents says there is corporate fear that cracking down on fraud will antagonize customers.
The study also suggests that some insurance companies also believe that investigating fraud is a waste of time because government authorities don't take the issue seriously.
2004 Canadian Health Care Fraud Survey:
http://www.fraudbox.com/assets/results.pdf [PDF Link!]
[Proofreader's note: this article was edited for spelling and typos on September 27, 2005]