Health Care Fraud: Legal and Ethical Implications

Health Care Fraud Ethical and Legal Implications
Health care fraud has significant legal and ethical implications on healthcare providers and organizations.

Health care fraud is any deceptive practice used in transactions in the healthcare system to exploit people and organizations for ulterior gains, such as personal financial gains. Concerns on healthcare fraud have increased because of increased vulnerabilities linked to the use of information technology, such as information systems for electronic health records and transactions in the healthcare system. These technologies are part of the ongoing advancement of the health care system. Health care fraud can occur in just about any health care organization in the country. The problem has significant adverse effects on the system and can be very difficult to address because of its complexity.

This article focuses on the ethical and legal implications of health care fraud.

Ethical Implications of Health Care Fraud

The ethical implications of health care fraud are on how managers of health care organizations apply effective ethical systems to successfully counteract the issue of fraud. Managers and leaders are directly responsible for the actions of their respective organizations. If healthcare fraud continues to occur in the organization, the health care organization remains vulnerable. Attention is needed on vulnerable areas of the healthcare organization, such as how the organization processes client and financial information.

Health care organizations must ensure that their activities remain compliant to standards and requirements imposed by the government, including those pertaining to ethical practice. Managers and leaders need to ensure that the practice of personnel within their organization are compliant to existing laws, rules and regulations, and the ethical codes of conduct from professional organizations linked to health care.

Legal Implications of Health Care Fraud

The legal implication of health care fraud on healthcare providers and organizations is the need to create better systems of compliance. Healthcare providers may face lawsuits for not taking the necessary steps to prevent fraud. Whistleblowers can expose illegal activities in healthcare settings. The government protects whistleblowers and they can be assets of the government in evaluating health care organizations and in identifying problems in the health care system. Healthcare providers and organizations must make sure that the conduct of personnel is compliant to rules and regulations on fraud specific to health care settings. Else, the healthcare provider or organization may be held liable for non-compliance of its personnel. Thus, health care fraud has led to the requirement that healthcare providers and organizations apply measures to ensure compliance to rules and regulations to prevent fraud.

Final Note

Health care fraud can be addressed through strict management approaches for compliance to rules in the health care system. The ethical implications of health care fraud point to the need to ensure ethical conduct of all personnel in the healthcare organization to prevent fraud. The legal implications of health care fraud require strict compliance to rules and regulations against fraudulent activity in health care.

  • Beauvais, B., Wells, R., Vasey, J., & Dellifraine, J. L. (2007). Does Money Really Matter? The Effects of Fiscal Margin on Quality of Care in Military Treatment Facilities. Hospital Topics, 85(3), 2-15.
  • Centers for Medicare and Medicaid Services (2015). Report Fraud & Abuse [Opens in New Window]
  • Hannigan, N. S. (2006). Blowing the whistle on healthcare fraud: Should I? Journal of the American Academy of Nurse Practitioners, 18(11), 512-7.
  • Harold G. Koenig. (2000). Editorial: Exploring Psychobiological, Psychosocial, and Cultural Aspects of Patient Care: The International Journal of Psychiatry in Medicine in the 21st Century. International Journal of Psychiatry in Medicine, 30(3), 195-202.
  • Mooney, G. (2009). Is it not time for health economists to rethink equity and access? Health Economics, Policy and Law, 4(2), 209-221.
  • Occupational Safety & Health Administration (2014). Filing whistleblower complaints under the Affordable Care Act [Opens in New Window]
  • Smith, K. V. (2005). Ethical Issues Related to Health Care: The Older Adult’s Perspective. Journal of Gerontological Nursing, 31(2), 32-9.
  • U.S. Department of Justice (2014). Justice Department Recovers Nearly $6 Billion from False Claims Act Cases in Fiscal Year 2014 [Opens in New Window]

This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Copyright by Panmore Institute - All rights reserved. Small parts of this article may be quoted or paraphrased for research purposes, as long as the article is properly cited and referenced together with its URL/link.