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pharmacy-fraudSeptember 30 2015

A report has suggested that fraud in general practice in England could amount to £348 million each year.

Accountant and business adviser firm PKF Littlejohn has estimated the level of fraud across the NHS as potentially being between £3.73 billion and £5.74 billion, using a variety of different sources, both from within the UK and globally.

Estimated levels of fraud in other NHS sectors include potentially £121 million in dental practice, £83 million in pharmaceutical services, £12.9 million in general optical services, £555 million in NHS Payroll, and potentially £1.27 billion in procurement.

Setting out how it achieved the estimate for pharmacy, it says that £2.1 billion was spent on Pharmaceutical Services (PhS) in the NHS in England in 2013-14. In addition, six NHS loss measurement exercises looking at the cost of fraud found an average rate of 3.97% in PhS. “If we apply this 3.97% percentage to PhS expenditure, fraud losses would equate to £83 million,” it says.

For general practice, it says £7.63 billion was paid to general practice service providers in 2013-2013. However, “as there has never been a successful NHS loss measurement exercise looking at expenditure on general practice, there is no NHS-specific loss percentage which can be applied.

“The best estimate of the cost of fraud in this area therefore has to be based on the healthcare global average fraud loss rate. If we apply this figure then fraud losses would equate to £348 million.”

It cites one example of a GP having falsified 1,700 patient records amounting to theft of £62,000, but also says fraud takes place in the following ways:

  • creating ghost patients
  • claiming for services provided to ghost employees including production of false prescriptions
  • claiming for services not provided (enhanced services)
  • raising false prescriptions for self-medicating
  • accepting bribes to register overseas visitors.

While recent data on patient prescription charge fraud has not been published, it refers to a Daily Mail report from December 2014 which suggested the figure was around £237 million. “It is not known how the Daily Mail obtained this information but there is no record of it having been challenged by the Department of Health. It would therefore not be unreasonable to accept this figure of loss for 2013-2014,” says the report.

The report has been written by Jim Gee, Head of Forensic and Counter Fraud Services at PKF Littlejohn, and Professor Mark Button, Director of the Centre for Counter Fraud Studies. Mr Gee is the former CEO of the NHS Counter Fraud Service.

“In the UK the NHS is under financial pressure as the cost of treatment rises faster than inflation and the resources that can be devoted to it. The good news from the report is that there are several examples cited where the cost of fraud (and healthcare fraud) has been reduced – by up to 40% within 12 months. Indeed the NHS itself achieved such reductions between 1998 and 2006, but the situation has now worsened again,” say the authors

“In the age of austerity, this report is intended as a contribution to a proper debate about how healthcare organisations can manage and minimise the cost of fraud and free up resources for better patient care.”

In response, a BBC report quotes Department of Health spokesperson as saying: “We do not recognise the figures in this highly speculative report which is full of inconsistencies. We are determined to stamp out fraud in the NHS through better information sharing to prevent and deter fraud and we are working with NHS Protect on crime risks and trends to do even more in the future.”

Links:

PFK Littlejohn announcement   

BBC coverage  

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