FRAUD & ABUSE IN HEALTH CARE ORGANIZATIONS

How do GAAP, Corporate Compliance, and Ethics combine to prevent Fraud & Abuse in health care organizations?

How do GAAP, Corporate Compliance, and Ethics combine to prevent Fraud & Abuse in health care organizations?

Introduction

In health care fraud cases and proceedings over $1.7 billion in judgments, settlements, and administrative impositions have been imposed by the United States General Accounting Office (GAO) at the highest level. This means higher costs to taxpayers and financial hardship and loss of mandatory services to normal individual. In the United States have been increasing in Medicare fraud and abuse and more than $38.5 billion or 11% of Medicare payments increase was noted in the year 2003. The health care providers were overpaid in the year 2004. A variety of schemes has been encompassed in the health care fraud.

Discussion

GAAP

Generally Accepted Accounting Principles provides an outline for accounting standards and financial principles used in any area. GAAP provides rules and guidelines for the preparation of financial and accounting statements.

Ethics

It is essential for health care professionals to follow ethical standards in their conduct. Ethical standards not only prevent frauds, but also improve corporate citizenship and position a firm as an ethical competitor within the business community. Professionals should not engage in activities which violates ethical principles.

Compliance

An effective Corporate Compliance Program is essential for today's healthcare agencies. This is significant in that the government wants the organization to demonstrate that their Corporate Compliance Program is effective. "Although we know that many companies have set up ethics programs, we know little about their actual influence on employee attitudes and behaviors" (Rehnquist 2004). It is essential for health care organization to have a compliance with fraud and abuse laws because it helps them to have success and and lawful behavior within the organization.

Fraud

Fraud incorporates a criminal activity which is forbidden under any jurisdiction. It is an offense and a crime which results in serious consequences.

Prevention of Fraud

The private and public insurers and providers nationwide are deceived by these frauds. The aim of these schemes has been the Medicare and Medicaid apart from the federally funded health benefit programs. Double billing schemes, hospitals billing for unnecessary or unperformed tests, physician kickbacks, and the quality of care provided to patients is few of the fraudulent activities. The patient safety is also endangered besides the monetary losses. Medicare or Medicaid insures more than forty million Americans. (Centers for Medicare ...