Healthcare Fraud: Whose Problem is it Anyway?

Abstract

The National Health Care Anti-Fraud Association estimates that the annual cost of healthcare fraud is somewhere between 3% and 10% of total healthcare costs.1 That estimate is not only astounding because of its magnitude, but also because of its range, indicating uncertainty. The sum of '100B per year, one way or another, matters. For example, that difference would fund all of the imagined Nationwide Health Information Network (NHIN) in any of its possible forms and a whole lot more. The Office of the National Coordinator for Health Information Technology (ONC) has completed two contracts related to healthcare fraud. The first, performed by the Foundation on Research and Education of the American Health Information Management Association, issued a report in 2005 in which an expert panel recommended a set of “Guiding Principles” for health information technology relating to healthcare fraud management.2 (“Fraud management” is defined as the prevention, detection and prosecution of fraud.) The second contract, performed by RTI International, issued a report in 2007 in which a second expert panel recommended 14 requirements for electronic health records related to healthcare fraud management.3 I served as the co-chairman of the first expert panel and the chairman of the second expert panel. It is my experience with these two panels and the subsequent industry reaction that prompts the title of this paper. In our kickoff meeting under the first contract, Dr. David Brailer, in giving the charge to our panel, asked us to answer the question, “Should the emerging NHIN play a role with regard to reducing healthcare fraud and, if so, what role?” The ensuing contract process involved an extensive review of the literature, on-site interviews with multiple healthcare stakeholders including providers, consumers, payers, healthcare economists, law enforcement, and technology organizations. The expert panel, which included representatives from …