Fraud in the health care system is a significant and growing threat.  The FBI estimates that between 3% and 10% of all health care expenditures are lost to fraud each year – up to $280 billion annually.  Health care fraud not only raises costs for consumers and employers – through higher premiums, greater out of pocket expenses, and inefficiency – it also puts patients at risk of undergoing unnecessary and risky tests and procedures.  And, of course, taxpayers are hit hard by the costs of fraud now that government programs, such as Medicare and Medicaid, dominate the U.S. marketplace.

The complicated nature of healthcare makes discovering fraud particularly difficult.  In addition, fraud can be perpetrated at many levels of the health care process – by providers, patients, suppliers, and third parties.  Health care fraud can take several forms, including:

  • Billing for services never provided.
  • Providers or patients selling drugs, devices, or supplies (including counterfeit items) on the black market.
  • Providing unnecessary, excessive, or duplicate services.
  • Employing unlicensed practitioners.
  • Falsifying information to enroll in public health insurance programs.
  • Un-bundling services or otherwise gaming claims to receive higher reimbursement.

Policy makers are well aware of health care fraud and have taken steps to address it.  At the Centers for Medicare and Medicaid Services (CMS), there are a range of activities under the Medicare Integrity Program and the Medicaid Integrity Program.  The HHS Office of the Inspector General (OIG) is very active in investigating cases of possible fraud and abuse in Medicare and Medicaid.   At the state level, state Medicaid agencies and state attorneys general are quite active.  Most large health insurers have their own sophisticated anti-fraud teams.  Despite these attempts to stem the tide, cases of fraud have remained pervasive, as highlighted in a recent GAO report on Medicare fraud: Important Steps Have Been Taken, but More Could be Done to Deter Fraud.

Forensic Health Services Research

Two researchers have offered an intriguing idea: using health services research to combat fraud.  In an article for the American Journal of Managed Care, Laurence F. McMahon, Jr. MD, MPH and Vineet Chopra, MD, MSc introduce the concept of forensic health services research.  Health services research (or HSR for short) is a multidisciplinary approach that examines the associations between access, cost, delivery, and outcomes.  HSR studies how social factors, organizations, financing systems, and human behaviors influence healthcare.  In their article – Introducing Forensic Health Services Research, Drs. McMahon and Chopra describe how health services research can be used as a tool to identify fraud and abuse.

Historically, given its ability to aide our understanding of costs and utilization, health services research has been successfully used to identify waste and inefficacy.  However, policy makers have the opportunity to employ HSR as a scientific discipline to help identify wasteful and fraudulent expenditures.  To make this happen, the authors recommend:

  1. Increased funding to attract HSR investigators, particularly by CMS.
  2. Payors should collaborate in data sharing to make HSR analysis possible.
  3. HSR investigators should be protected from the repercussions of their work (i.e., whistleblower protections).

While health services research has been woefully underfunded and has often struggled to provide actionable advice for policy makers, use of HSR to combat health care fraud is a great idea.  It could also play an important role in closing the longtime gap between research and policy.

To learn more about health services research, visit AcademyHealth.org and AHRQ.gov.  AcademyHealth is the professional society of health services researchers.  At the federal level, most health services research is done through the Agency for Healthcare Research and Quality (AHRQ).