August 3, 2019

Over the years of discussion of healthcare reform, it is often mentioned that wide-spread fraud in the system contributes greatly to healthcare expense. I traditionally have discounted these statements due to my belief that fraud, although costly, is a minor part of the over-all expense of healthcare. However, through personal observation and continual reports of fraud in the media, it is clear that fraud exists on a significant scale. If we eliminated fraud, would we drastically reduce the total cost of healthcare? I doubt that we would. However, we would reduce the cost; attain a higher level of trust with patients, community members, employees, and payers.

So, if it is beneficial to eliminate fraud, why don’t we? Well, that is a multi-faceted question that cannot be adequately addressed in a short article. However, we can look at a specific case which could be fictional, but at the same time, could be a combination of events or even a real example. Regardless, you, the reader will relate with your personal experience and/or know a colleague who has experienced such a situation.

The situation occurred in a small town with a small hospital. An employed physician received over $750,000.00 in bonus payments that were unearned due to an alleged contract manipulation between a previous CEO and the physician. The situation was researched by current staff and appropriately reported to the publicly elected Board of Trustees. The Board of Trustees responded (in chronological order) as follows:

  • Shock and disbelief
  • “Terminate the physician”
  • “Seek repayment”
  • “We need doctors”
  • “It was our mistake”
  • “Sometimes you need to go along to get along”
  • “I don’t care about the $750,000.00, if they will stay”

From the above, you can see how the Board moved from outrage to ultimate acceptance. Repayment of the unearned money was not pursued and the physician did not repay the unearned bonus. Is this fraud? Yes! Is this unethical? Yes! Is it costly? Yes! Is it demoralizing? Yes! Does it cheat the tax payer? Yes!

So, if we know that a situation is wrong on a number of levels, why do we rationalize the bad behavior? There are an infinite number of reasons that are beyond the scope of this article. However, if we truly believe that healthcare fraud is wrong on all levels, each of us (as leaders) MUST make the difficult decisions to address and eliminate fraud regardless of the proposed rationalizations and the personal consequences of doing the right thing!