Fraud in the US Healthcare System 

Unethical medical professionals are responsible for the loss of billions of dollars and exacerbating prescription drug abuse, at the expense of those seeking care. Healthcare license fraud is one example of unethical behavior and involves a person providing care and taking payment for treatment without the proper education and license. The implications of fraud in the US healthcare system are far-reaching.  

The US Department of Justice Healthcare Fraud Unit “routinely prosecutes defendants who orchestrate schemes that result in the loss of hundreds of millions or billions of dollars, the distribution of tens of millions of opioids, and complex money laundering, tax, and other associated financial crime offenses” (1). Healthcare fraud erodes systems of care by taking money and resources from patients who need it and/or misusing the authority and status associated with being a healthcare professional.  

However, many protective measures are in place to detect and reduce instances of healthcare fraud. For example, the National Practitioner Data Bank, a branch of the US Department of Health and Human Services, is a massive data repository that tracks information about adverse actions, medical malpractice payments, and judgments and convictions. This helps to track medical professionals who move across state lines to avoid detection (2). Using data to track instances of healthcare fraud across the US minimizes the risk of healthcare facilities hiring practitioners who have a documented history of clinical errors or crimes. 

More broadly, the False Claims Act allows patients and care-seekers to file suits on behalf of the government in fraud cases (3). This is especially pertinent in cases involving Medicare, Medicaid, and federal healthcare programs, which, as of December 2022, represents over 92 million Americans that are enrolled. The question remains: How prevalent is fraud in the US healthcare system? 

In 2022, there were over 900 civil cases of fraud and over $2 billion in settlements and judgements under the False Claims Act. The Department of Justice stated in a February 2023 press release that healthcare fraud was the leading source of False Claims Act settlements and judgements. This encompassed unnecessary services, substandard care, aggressive drug pricing, and fraud and abuse in the Medicaid program. With an average of more than 12 new cases every week, whistleblowing for fraud in the US healthcare system is common. 

With 2022 achieving the second highest number of False Claims Act settlements in history, it seems that healthcare fraud is a critical issue. Overdiagnosis of illnesses has been investigated by the DOJ to an estimated amount of over $12 billion dollars in overbilling in 2020. Patient care is not improving, while billions of dollars are siphoned from a system that is designed to support vulnerable populations and that is already underfunded. Furthermore, physicians that over-prescribe medications to increase patient access to controlled drugs, over-bill patients for unnecessary treatment, or provide inadequate care can ultimately erode the trust that patients have in the healthcare system.  

References 

1. Department of Justice. (2023). Healthcare Fraud Unit. https://www.justice.gov/criminal-fraud/health-care-fraud-unit.  

2. National Practitioner Data Bank. (2023). About Us. https://www.npdb.hrsa.gov/topNavigation/aboutUs.jsp 

3. Department of Justice. (2023). The False Claims Act. https://www.justice.gov/civil/false-claims-act