Healthcare Fraud

Abstract

Healthcare fraud involves wide-ranging illegal behaviors. It includes such activities as physicians who bill insurance companies or the government for services never provided, or that were unnecessary and, in many cases, harmful for the well-being of patients. Corporations are also involved in healthcare fraud, such as pharmaceutical companies that falsify clinical studies to get unsafe drugs approved for general population use. Healthcare fraud, similar to other white-collar crimes, has three general costs: financial, physical, and social. First, the United States is likely the largest financial victim of healthcare fraud in the world. This is in part because the United States unquestionably outspends other advanced industrial nations, in terms of both total expenditures on health as a percentage of gross domestic product and expenditures on health per capita. More money available in the United States for healthcare likely translates into additional opportunities for fraudulent activities and further monies lost due to these illegal acts. Second, healthcare fraud also has a physical cost. Thousands of patients in the United States die from prescription medications that were incorrectly prescribed or from tainted drugs approved by the US Food and Drug Administration as a result of fraudulent testing and reporting. Thousands of additional patients are injured and killed by unnecessary surgeries performed by physicians who want to maximize their reimbursements. A third and final cost of healthcare fraud concerns social costs. Such costs cannot be numerically calculated, and they include a loss of respect for and trust in the medical profession. In general, the financial, physical, and social costs of healthcare fraud are likely substantial in all advanced industrial nations.