Question

As a CEO of a hospital, discuss why fraud occurs? Discuss policies and actions at your hospital to prevent fraud? (200 word count)

Answer 1

Fraud can be defined as an intentional misrepresentation or deception of facts that can lead to an unauthorized gain or payment. This may hit to the reputation of any a health care organization. As a CEO, my research displays there are three types of fraud which are particularly common:

1) Diversion of patient fee revenue at point of service: To avoid this type of fraud, I will advisable the administration to fill out receipts with the amount noted in numbers and in words; and moreover there need to have a higher level of authorization for the release of refunds.

2) Diversion of accounts receivable, or checks submitted by firms or patients to pay debts owed on their accounts. Such type of fraud can be avoided by segregation of duties, i.e. having one individual open the mail or handle customer cash, while a different individual will be held responsible for cash deposits and follow-up collection. Moreover provide monthly statements to to the clients and asking employees to take regular leaves to deter the fraud.

3) Collusion between hospital purchasing agents and suppliers wherein the purchasing clerks and accountants can collude with suppliers for making a deliberate overpayment for an order. It can be avoided with improvements in financial and administrative systems so to deter employees from attempting these types of fraud.