Part 7. Fraud Is Simple To Detect, Inexpensive To Find
Every credit card company has ways to detect potential fraudulent activity and they take simple steps to verify the validity of suspect charges. For instance, if they see a charge on a credit card that is atypical such as large purchases made just after small ones (which is, apparently, behaviour characteristic of a criminal with a stolen card) or a large number of online purchases or purchases that don’t fit a cardholder’s profile, they will telephone the cardholder to ask if he or she authorized the purchase. And why? Because credit card companies are intensely interested in stemming the losses they incur from fraudulent transactions.
Banks monitor for fraud all the time, and for the same reason. They use fraud detection indicators to identify anomalies such as unusually high purchases of popular items, they flag multiple accounts opened within a short period of time, they monitor usage patterns. They use readily available software that analyzes data and generates alerts.
Private insurance companies employ a variety of methods, both electronic and good old-fashioned “have a look”, to detect and discourage fraud. They employ pre-payment investigation of flagged claims, they employ forensic accountants, they monitor specific healthcare providers. They have instituted co-pays and deductibles, not just for the cost-saving component but also to give the patient incentive to refuse unnecessary treatment. Some areas of benefit particularly susceptible to fraud and abuse now have annual or even lifetime caps. Some insurance companies limit the quantity of medical accessories that they will cover.
There are software companies, service providers and many other types of business who specialize in providing fraud detection services. And some of them are very, very good at what they do.
When it comes to the government, not only do they have the budget to do this, they also have the means already in hand.
And what does the Ministry of Health and Long-Term Care do to stem the drain of tax dollars stolen by fraud? They’ve set up an email address and a hotline for “the public” to report suspected cases of health card abuse. Please.
How much time or effort would it take the Ministries of Health to do something effective in combating fraud? Take for example the Ontario Health Insurance Plan or OHIP. The Ministry does send letters to patients asking them to verify that they did receive the services that were billed for. This is not a very effective strategy, though, as the response rate from the patients is less than 2%. Instead, how about requiring that a patient sign a form after treatment verifying that the treatment and services being billed for were in fact received? Granted, that would be a nuisance for all concerned but it would make it very difficult for anyone to bill for goods and services not delivered.
Every doctor who bills OHIP has a profile in the system. Well it doesn’t take more than a single report to determine which of these are billing outside of the typical profile. So if you have, say, 1000 of a particular type of specialist in the system billing an average of $400,000 annually, the few that are billing several times that should be easily detected and flagged for investigation. The ophthalmologist who billed $6.6 million in one year springs to mind as do the 154 diagnostic radiologist who each billed OHIP $1 million or more.
Even the Ontario Minister of Health and Long-Term Care recognizes that something is wrong. Eric Hoskins was quoted in the Toronto Star as noting that “2% of doctors … take 10% of the $11.6 billion set aside to pay doctors for their services, offices, staff and equipment”. And what did the Minister propose to do about it? In a classic case of missing the boat, Hoskins wanted to cut fees payable to all doctors. If the Ministry would devote some private-sector-style effort to detecting and deterring fraud, the money that would be saved would not only more than eliminate any need for fee cuts, it would also pay for the fraud detection software, systems, and personnel.
And they can do it. But they don’t.
Are the Ministries restricted in pursuing fraud by the current legal framework? That’s covered in part 8 of our series.
Tim Daciuk says
Actually you are wrong, as so much of this series has errors. With credit cards, if a charge is denied, you don’t get to buy your roller skates. If a healthcare charge is denied you don’t get your heart medication”. As a result health systems always have to err on the side of being more forgiving, as the stakes are so much higher. Your comparison to banks and credit cards is naïve at best.
Judy Gayton says
Toxic Allopathic drugs, touted as protective of heart or any disease for that matter actually cause heart disease. This, coupled with chronic misinformation about diet, specifically fats, bought and paid for by self interested lobby groups peddling their unfit for human consumption wares, provided a reasonable explanation as to why heart disease is so prevalent. The more Allopathic drugs a person consumes, the more health problems they suffer.
The solution disingenuously couched as “forgiving” fraud a is a euphemism for turning a blind-eye to the death, disease and addiction caused by the toxic sick care industry and those profiting from covering up the harm it causes.