FRAUD and error according to the European Healthcare Fraud and Corruption Network and the Center for Counter Fraud Services at Portsmouth University in Britain accounted for approx. $260 Billion in financial losses from global health care organizations. Yes, that’s billion with a B, five times the amount of money Bill Gates has and its lost every single year worldwide due to employee embezzlement and financial error. Global healthcare organizations are so often harranged and criticized for minuscule issues in comparison; it is absolutely shocking that overhauls in financial monitoring have not been performed on many of the big international and domestic healthcare units today.
Organizations like the Global Fund to fight AIDS, Tuberculosis and Malaria are constantly scrutinized for barring certain nations from funding. But what if they were instead more interrogated about their financial transparency and decorum. Perhaps then they could have avoided huge financial frauds like the famous Uganda challenge (http://www.ugpulse.com/articles/daily/Health.asp?ID=388), or the charges of fraud in India (http://www.alertnet.org/thenews/newsdesk/DEL264044.htm). The $260 Billion lost from organizations like this and smaller scale healthcare services could’ve quadrupled World Health Organization and UNICEF’s budget if protected from fraud and error. Perhaps with less fraud the Global Fund could’ve gotten around to funding those less fortunate countries.
What could be done to protect these organizations from fraud like this? These problems are in no way unique to global health organizations but their typical structure makes them especially vulnerable to money mismanagement. And sadly, because these organizations are largely dependent on large individual donations to operate, incidences of fraud especially harm prospective donors’ faith in them. Similar to not for profit organizations these units are dependent on the integrity and goodwill of their employees. Typical employees are not the type of people to be readily expected to steal money but instead could be more of an idealist with seemingly good intentions, perhaps even someone who’s accepting a drop in salary just to be working with an organization they are morally aligned with.
Studies show that in the not for profit sector the employee that steals is most likely to be described by their coworkers as honest and hard-working. It is precisely because they work hard, and because they feel they are doing an additional service, perhaps by taking that pay cut in order to be able to work at a morally inclined organization, that these employees feel entitled to more than their salary’s share. It is important that employees inside these organizations remember to maintain a healthy level of suspicion of their coworkers. And even more importantly, it is necessary that the heads of global health organizations revolutionize their financial transparencies and scrutinies. Its more than just a financial issue, millions of lives are at stake!
This problem is not unique to global health care organizations but has always been a huge issue for organizations that aren’t just about making profits. Like many not for profits these organizations depend on the integrity and good will of their employees. Lots of the time these employees aren’t as particularly fiscal minded.
Bernie Madoff made headline news all across the world for the largest ponzi scam in world history defrauding financial companies for approx. 18 Billion dollars. Deplorably, that is but a small percent of global health care annual losses from financial fraud and error. If these facts about global healthcare fraud are being read by you for the first time this instant, does it seem like governing priorities are healthy?
http://www.reuters.com/article/idUSTRE60H01620100118: Reuters article on Global Healthcare Fraud 2010
By: Gregory Leslie