Auditors battle with £14m health fraud

24 Sep 98
The battle against NHS fraud will be lost without further government support, health service accountants warned this week.

25 September 1998

The Healthcare Financial Management Association, which represents those who work in NHS finance, said better anti-corruption training should be introduced to tackle the problem. An HFMA survey of 74 health authorities found that 163 fraud investigations were launched in 1997, involving £8.2m. It believed frauds totalling £14m were perpetrated against the health service last year.

Around two-thirds of the swindles discovered last year occurred in primary care, the area which the HFMA and the Audit Commission has consistently identified as being most prone to fraud. The NHS spends £11bn a year on primary care services, such as general practice and eye and dental care. But according to the HFMA, the system for checking the validity of payments was based largely on trust. This will embarrass ministers who intend to hand over control of healthcare budgets to GPs and other primary care professionals next April.

Accountants and other NHS managers have called on the health department to ensure financial controls in the new system are adequate.

Health authorities and trusts have worked hard to put anti-fraud measures in place, the HFMA said. Most have action plans to counter corruption and the executive responsible for tackling fraud normally had a finance or an audit background.

Though some NHS bodies were working closely to address corruption, others were less co-operative. In audit, more than one in ten health authorities complained that the inability of internal and external audit bodies to work together had hampered the investigation of deceit in dental claims.

Only 6.4% of the money involved in all cases was recovered during the year, though this is twice as much as the previous year. Recovery was reported in only 22 of the 163 reported frauds.

Most of the organisations that responded to the survey said training was inadequate. This lack of knowledge made it difficult to obtain and interpret evidence to prove a misdemeanour had taken place.

John Flook, the HFMA's corporate governance and audit committee chairman, said there were encouraging signs. 'The survey reveals a little more of the iceberg of fraud. It is clear that authorities are taking the issue more seriously.' He added: 'There needs to be much greater investment in the training of managers and specialist auditors on fraud investigations.'

In Northern Ireland, audit chief John Dowdall warned that primary care fraud could be £15m a year – more than 11% of the payments made to the province's primary care practitioners.


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