By its very nature, fraud is a hidden crime. Fraud against the NHS results in less money being available for patient care.

The vulnerability of the NHS to fraud is likely to be heightened against the background of widespread organisational change and cuts in resources.

Press coverage

A recent report “The financial cost of healthcare fraud 2014” has attempted to quantify the true cost of  fraud. Co-authored by BDO LLP and the University of Portsmouth, the report analysed worldwide healthcare expenditure and concluded that just under 7% of total health expenditure is lost to fraud and error.

The report was picked up by the BBC’s Panorama programme “The Great NHS Robbery,” which suggested that fraud in the NHS could be even greater than benefit fraud. They reported that the NHS had fewer resources to tackle fraud than the DWP (who employ six times the number of investigators than NHS Protect) and that NHS Protect has had its budget cut by 30% since 2006.

Panorama estimated that £7 billion was being lost to fraud in the NHS each year and cited widespread and varied examples of fraud ranging from GP’s, dentists and private companies manipulating patient figures to theft of medical products for resale on eBay.

The government’s annual fraud indicator shows only £229 million losses in the NHS, attributed to patients claiming false exemptions and dentists making false claims. It is likely that these official figures represent only a fraction of the suspected losses, with procurement and payroll being two particularly vulnerable areas that are not measured.

On the ground

NHS Protect has been doing an admirable job, deploying approximately 300 accredited counter fraud specialists to tackle fraud at a local level. NHS Protect has achieved some high profile successes, including the conviction and imprisonment of dentist Joyce Trail for seven years after she obtained some £1.4 million from the NHS by forging documents and claiming for procedures on patients she had never met or were no longer alive.

Despite NHS Protect’s efforts, securing a criminal conviction can take many years, with the standard of proof in criminal cases being “beyond reasonable doubt”. Overcoming this hurdle requires a huge investment of time and resources and the evidence does not always support a prosecution.

Civil litigation

It is however possible to pursue fraudsters in the civil courts. Whilst cogent proof is required in a civil fraud claim, the standard of proof is lower than that in a criminal case, being “the balance of probabilities”.

Civil litigation has a number of other advantages, including the ability to act quickly, to obtain interim orders (such as search orders and freezing injunctions) and greater control over the timetable of the case and what information is released into the public domain. Cases are also determined by a judge, reducing the uncertainties associated with jury trials. It is possible to run civil and criminal proceedings in parallel.

Mills & Reeve have acted for numerous NHS bodies, liaising closely with local counter fraud investigators, and have recovered monies in cases where the evidence did not support a criminal prosecution.

Both criminal and civil options should be carefully considered at the outset of any fraud investigation. Given the likely extent of fraud in the NHS and the difficulties faced in securing a criminal conviction, NHS bodies may increasingly focus their resources on fraud prevention and look to the civil courts for a positive outcome