Over the past few decades, fraud and abuse in the healthcare system has increased rapidly. Healthcare fraud occurs when individuals or entities defraud the government or insurance companies in healthcare schemes. Types of healthcare fraud include drugs and medical fraud. Abuse, on the other hand, occurs when the medical practitioners do not offer professional health practices that are acceptable by medical standards. Healthcare fraud and abuse have severe consequences. There are statutes that can be used to prosecute any individual that is involved in healthcare fraud and abuse. Major examples include; the Federal Healthcare Fraud Statute 18 U.S.C. 1347 , the Anti-Kickback Statute and the Civil Monetary Penalties Law (Leap & Billing, 2011).
The Federal Managers Financial Integrity Act of 1982 has assisted in reducing fraud and abuse. According to the Federal Managers Financial Integrity Act section 2, agency heads are required to submit a report indicating whether its financial statements and internal controls are efficient and effective (Leap & Billing, 2011). Firstly, the FMFIA has ensured that the internal controls are regularly maintained to curb fraud and abuse. Well established internal controls, reduce the rate of fraud in a healthcare facility.
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Secondly, FMFIA enhances accountability of all people in an agency. Duties are well allocated and segregated; hence it becomes hard for abuse and fraud to take place. Thirdly, the FMFIA and OMB Circular A-123 work hand in hand. Generally, the OMB Circular A-123 outlines the responsibilities of managements in federal agencies (Leap & Billing, 2011). This ensures that managers are well equipped with the know-how in performing their duties to reduce fraud and abuse. Finally, FMFIA provides corrective actions necessary to reduce cases of fraud. These measures help to decrease the occurrence of improper payments that result to frauds.
In conclusion, fraud and abuse can occur due to lack of proper internal control systems. To mitigate this, the Federal Managers Financial Integrity Act of 192 was established. The act has reduced the rate of fraud and abuse in many federal agencies. Finally, the act should be properly implemented to reduce its setbacks.
Reference
Leap, T. L. (2011). Phantom billing, fake prescriptions, and the high cost of medicine: Health care fraud and what to do about it . Cornell University Press.
