A thorough root cause study is required in the case of Timothy Emeigh, a Maryland healthcare provider sentenced to 10 years in federal prison for healthcare fraud that resulted in patient deaths, to determine why and how the Medicare fraud happened. We may discover the fundamental causes of this fraudulent conduct and obtain insights into prospective preventative measures and risk management tactics for the future by using the “Five Whys” method.
Why did Medicare fraud occur?
Systemic flaws in the supervision and control procedures inside healthcare provider organisations led to Medicare fraud. The absence of strict checks and balances allowed fraudulent acts to flourish covertly. The commission of fraud was further aided by inadequate personnel supervision and training. Some dishonest people were drawn by the promise of financial gain to take advantage of loopholes in the system, which resulted in fraudulent claims, overbilling, and other dishonest actions (Leder-Luis, 2023). Authorities must strengthen regulatory monitoring, develop strong internal controls, and promote a culture of compliance and integrity within the healthcare sector to effectively battle this threat and protect Medicare and the vulnerable people it serves.
Why was there a lack of oversight and control measures?
A poor management structure inside healthcare institutions, which resulted in insufficient supervision and control mechanisms, is the root cause of Medicare fraud. The inability to prioritise compliance and fraud detection may be brought on by a lack of committed compliance officers or a compliance culture that places insufficient emphasis on moral behaviour and regulatory compliance. When a company ignores these important factors, it fosters a fraudulent atmosphere where dishonest people may exploit weaknesses for their gain (Ramadhan, 2020). Strict compliance regulations, an honest work environment, and hiring specialised individuals to fight fraud and safeguard Medicare’s integrity successfully are necessary to address these concerns.
Why did the management structure fail to prioritise compliance?
The management structure’s inability to put compliance first may result from a profit-driven approach prioritising material advantages over moral behaviour. The organisation’s push to increase income may cause them to ignore fraud warning indicators and red flags. A larger possibility of accepting or disregarding questionable actions exists when financial reasons precede ethical obligations. This culture’s emphasis on profit may unintentionally support deception as long as it results in higher earnings (Leder-Luis, 2023). Healthcare organisations must balance their financial objectives and moral convictions, foster an environment of openness and honesty, and tighten compliance controls to stop Medicare fraud and safeguard beneficiaries to handle this issue.
Why did the organisation prioritise profit over ethical practices?
Financial difficulties or ferocious rivalry in the healthcare sector may have affected the organisation’s decision to put profit above moral behaviour. Some healthcare organisations may give in to fraudulent schemes to increase income when pressured to maintain their financial viability or obtain a competitive edge. They can be tempted to take shortcuts to retain profitability or to survive in a cutthroat market, which would undermine their ethical standards (Ramadhan, 2020). Regulators need to address the underlying causes of these problems, implement effective monitoring, and encourage a business climate where ethical actions are rewarded, deterring dishonest behaviour in the quest for financial gain in such a difficult environment.
Why did Timothy Emeigh participate in the scheme?
Timothy Emeigh’s involvement in the Medicare scheme was probably motivated by selfish or financial objectives. He could have experienced financial issues or been seduced by the prospect of great rewards for participating in the fraudulent operations. Additionally, his lack of moral guidance and ethical instruction may have contributed to his propensity for engaging in such illegal activities.
The danger of Medicare fraud and similar incidents within the business may have been successfully mitigated by the administrator implementing some important preventive measures. Firstly, it would be crucial to create and enforce effective compliance systems. All staff members would receive thorough training and workshops, ensuring they know pertinent laws and moral principles (Johnson & Khoshgoftaar, 2019). These lectures would underline the serious repercussions of participating in unethical behaviour and the significance of upholding ethical standards.
The second step would be to strengthen internal controls. This might be accomplished by putting in place strong controls, including separation of roles, frequent audits, and monitoring procedures. By establishing openness and accountability, these steps would make it far more difficult for anyone to carry out fraudulent operations unnoticed. Another essential component of preventing fraud is fostering a culture of reporting wrongdoing (Pourhabibi et al., 2020). Early detection would benefit from creating a climate where workers feel secure and protected when reporting suspicious behaviour or probable fraud. Establishing anonymous reporting methods and providing protections for whistleblowers would be necessary to promote such a culture.
The organisation’s financial processes and compliance adherence might also be objectively assessed by employing third parties to undertake routine external audits. These audits provide another level of inspection and are an excellent way to spot any anomalies or fraudulent activity. Finally, it is critical to support ethical leadership among senior executives. When leaders prioritise compliance and ethical behaviour, it sets a powerful example for workers at all levels (Johnson & Khoshgoftaar, 2019). Encouraging everyone in the organisation to preserve ethical standards and follow established rules has a trickle-down effect that lowers the likelihood of Medicare fraud and other unethical activities. Administrators may greatly improve the organisation’s capacity to avoid fraud and promote an environment of integrity and accountability by putting these preventative measures into place.
In summary, Timothy Emeigh’s Medicare fraud resulted from several interrelated causes, including a lack of supervision and control procedures, along with an organisational concentration on profit above ethical principles. Healthcare organisations can significantly lower the risk of fraud and ensure their patients’ and stakeholders’ safety and well-being by conducting a thorough root cause analysis and implementing preventive measures like strong compliance programs, internal controls, whistleblower protection, external audits, and ethical leadership.
References
Johnson, J. M., & Khoshgoftaar, T. M. (2019). Medicare fraud detection using neural networks. Journal of Big Data, 6(1), 1-35. https://doi.org/10.1186/s40537-019-0225-0
Leder-Luis, J. (2023) ‘Can whistleblowers root out public expenditure fraud? evidence from Medicare’, Review of Economics and Statistics, pp. 1–49. doi:10.1162/rest_a_01339.
Pourhabibi, T., Ong, K. L., Kam, B. H., & Boo, Y. L. (2020). Fraud detection: A systematic literature review of graph-based anomaly detection approaches. Decision Support Systems, 133, 113303. https://doi.org/10.1016/j.dss.2020.113303
Ramadhan, D. (2020) ‘Root cause analysis using fraud Pentagon theory approach (a conceptual framework)’, Asia Pacific Fraud Journal, 5(1), p. 118. doi:10.21532/apfjournal.v5i1.142.
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