Fraud: counter measures

27 March 2018 Seamus Ward

Login to access this content

Several things are known about fraud against the NHS: it is under-reported; the understanding of fraud and associated financial risk is patchy across the service; and there is a lack of benchmarks at local level. To help address this, the Department of Health and Social Care has set up the NHS Counter Fraud Authority (NHSCFA) to gather intelligence on fraud, build the understanding of risk and develop innovative and proportionate ways of tackling fraud against the NHS.

Set up last November, the NHSCFA initially grabbed headlines through its estimate that the NHS lost £1.25bn a year to fraud. It has since been working in the background, implementing its strategy and developing standards for commissioners and providers.

These standards were published in February and include a quality assurance programme with a self-assessment tool. The NHSCFA can visit an NHS organisation to assess its counter-fraud arrangements, while clinical commissioning groups also have a role in ensuring their providers’ arrangements are satisfactory.Matthew Jordan-Boyd

Healthcare Finance spoke to Matthew Jordan-Boyd (pictured), NHSCFA director of finance and corporate governance, about the role of the authority, the importance of counter-fraud arrangements in good governance, the levels of fraud and the assurance regime for local counter-fraud arrangements.

How is the work of the CFA different from NHS Protect – is it a rebadging or a change in approach?

The NHSCFA is a new special health authority and was created to focus purely on fraud, bribery and corruption across the NHS. The new structure and approach is designed to focus on filling the gaps in knowledge to improve understanding of fraud within the system in support of the Department of Health and Social Care anti-fraud strategy with a view to identify cross system solutions that reduce the financial loss to the system that fraud creates. 

What’s the local counter-fraud structure – has it changed?

No, the local counter-fraud structure has not changed. Each NHS body is directed by the secretary of state to take such action as is reasonably necessary for the purpose of preventing, detecting or investigating fraud. Each NHS organisation is still required to have access to an accredited local counter-fraud specialist to undertake local counter-fraud work.

The interaction between the local counter-fraud specialists and the NHSCFA differs, however, from the previous central approaches, as NHSCFA does not provide the support function for investigative work that was previously delivered by NHS Protect.

NHSCFA provides a quality control process for counter-fraud investigative work and provides the gateway process for NHS organisations to submit case files to the Crown Prosecution Service.

Due to this change in approach we have identified as a priority in 2018/19 the need to develop stronger links with the finance directors and chief finance officers to identify the best ways in which tools and information can be shared to ensure counter-fraud work is delivered effectively at a local level.

As part of their corporate governance role, what should boards be doing to counter fraud in their organisations?

The NHSCFA has developed and published its counter-fraud standards for providers and commissioners and has set out the approach to strategic leadership of counter-fraud. I would hope that boards and audit committees have familiarised themselves with those requirements to ensure internal assurance of delivery. However, the audit committee has a crucial role in holding the organisation independently to account in the application of the standards and in ensuring fraud, bribery and corruption are prevented or, if not prevented, properly investigated. The published counter-fraud standards can be found at www.cfa.nhs.uk.

Should the finance director/CFO lead on this?

Yes, I believe the finance director/CFO is key to driving the counter-fraud message at a strategic level. In the NHSCFA counter-fraud standards, organisations are required to have a member of the executive board responsible for overseeing and providing strategic management and support for all counter-fraud, bribery and corruption work within the organisation.

What is the level of NHS fraud?

The NHSCFA estimates the overall losses to fraud in the NHS to be £1.25bn [a year]. This estimate is based on our knowledge of fraud in the system to date and is reviewed annually.

What areas are most at risk?

Our strategic intelligence work identifies the key areas that we believe need to be addressed, although fraud is an ever changing issue and we must all be vigilant to ensure we identify new approaches by criminals as they emerge (see box for more).

 Is there a level that NHS fraud could be realistically brought down to?

We know that the fraud threats change as criminals look at different methodologies to defraud systems. NHSCFA, working with finance directors/CFOs, wants to bring the overall level of fraud down and will target those areas in which we can make the most impact across the system. In 2017/18 we have targeted optical fraud and EHIC (European Health Insurance Card), and in 2018/19 we will be targeting procurement and commissioning fraud and [fraudulent] pharmaceutical contractors.

Are there areas of anti-fraud activity on which CFA will focus/NHS bodies should focus?

As previously stated, the landscape of fraud is ever changing. However, areas of known NHS fraud include but are not limited to:

• Dental, pharmaceutical and optical contractor fraud

• GP fraud

• Payroll and identity fraud

• Access to care, procurement and commissioning fraud

• National tariff and performance data manipulation fraud.

What is the cost of counter-fraud activity?

NHSCFA spends in excess of £10m annually targeting and developing system-wide solutions to fraud, bribery and corruption within the NHS. However, each individual NHS organisation is responsible for the procurement and delivery of its own local service and will fund this directly as this requirement will be based on their local assessment of counter-fraud risk.

What do the CFA’s quality assurance programme self-assessments and on-site assessmentstell us about the robustness of counter-fraud activity in the NHS?

Few organisations meet all the standards when assessed. However, we have seen improvement in both providers’ and commissioners’ efforts to develop a strong counter-fraud culture within their own organisations. NHSCFA is working with strategic partners in order to develop its role in assisting organisations to identify fraud locally, and try to increase engagement with directors of finance and other finance professionals.

Self-assessments should be signed off by a board member – should this be the finance director or the full board?

Self-reviews are required to be signed off by the finance director, but best practice would be for audit committees to be fully engaged and boards sighted.

What is a commissioner’s role in ensuring providers have anti-fraud measures in place?

NHSCFA counter-fraud standards require co-ordinating commissioners to hold providers to account where the provider is not complying with standards. Where commissioners are not complying with standards, NHS England will hold them to account.

How will commissioners review providers’ arrangements?

Commissioners have a responsibility to review the self-review tool returns annually and seek further information for any areas of concern regarding counter-fraud compliance.

Will all commissioners have to review a provider’s anti-fraud arrangements or will it be performed by a lead commissioner?

Co-ordinating commissioners have been identified and they will review the self-review tool of providers under their co-ordination. They can liaise with the NHSCFA while undertaking this where required.

Level of fraud

The NHSCFA says fraud is under-reported and this can be due to suspicious activity being missed or a misconception that reporting fraud casts the organisation in a bad light. There are inconsistencies in local counter-fraud activity, it adds – in how it is reported and recorded and how fraud is identified and investigated, as well as the process used to apply sanctions.
Breakdown


























Supporting documents
Counter measures - April 2018