Healthcare fraud in North America a multi-billion dollar problem

by David Keelaghan28 Apr 2017
Healthcare in North America is big business. Last year, Canada’s health expenditure was $228 billion, which equates to $6,299 per person. It’s a healthy sum for sure, but is dwarfed by the US, where US$3.2 trillion dollars was spent in 2016. With such mammoth amounts involved, it is inevitable that certain individuals will try to game the system. According to the CLHIA, it is estimated that 2–10% of all healthcare dollars is lost to fraud in North America. It is a significant problem, not just on this continent but worldwide, which led to the formation of the Global Health Care Anti-Fraud Association (GHCAN). Signature members of the group were the Canadian Health Care Anti-Fraud Association, the European Healthcare Fraud & Corruption Network, the UK’s Health Insurance Counter Fraud Group, the Healthcare Forensics Management Unit in South Africa and the United States’ National Health Care Anti-Fraud Association.

The Canadian Health Care Anti-Fraud Association has since been rolled into the CLHIA’s remit, but the objectives remain the same: to build public, private, national and international partnerships with insurance carriers, service providers, law enforcement, health regulatory bodies, consumer groups and provider associations.

Lou Saccoccio, CEO of the National Healthcare Anti-Fraud Association in the US explains how collaboration is the best method to reduce fraud across the board.

 “The idea was to bring the private and the public sides together to share information about fraud and do educational programs,” he explains. “One of the best ways to go after fraud is to have the payers talk to each other because one payer may be seeing certain schemes the other isn’t aware of.”

In detecting fraud, the insurance providers of today have tools that were not available until recently. The digital era means scams have become increasingly sophisticated, but technology is being harnessed to stop bogus claims in their tracks.

“You need to use data analytics with things like predictive modelling and look at your claims data,” says Saccoccio. “Through that you can analyze were fraud is likely to be. What you really want to do is try and prevent it before it happens as opposed to pay and chase mode.”

He added: “You also have to invest in resources – investigators, clinicians, analysts. With data analytics you will get certain information, but you need to follow that up with investigation through people resources. Data analytics makes it easier, but it’s not foolproof and fraud is still a big problem.”


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