Anti-fraud software extended to all NHS acute trusts

A pilot scheme that detected nearly £1m of duplicate and fraudulent payments by the public sector has been extended to include all NHS acute trusts.

The Audit Commission’s creditor data matching exercise, in which NHS and local authority records are matched against each other and records from Companies House with the results fed back to trusts and LAs on a CD-ROM, proved so successful that it has been made mandatory for all NHS acute trusts and local councils for 2006-07. Primary care trusts (PCTs) have been given the option to join.

The scheme was piloted by 50 local authorities and four NHS trusts in 2004-05 as part of the National Fraud Initiative.

Peter Yetzes, associate director for IT at the Audit Commission, said: “In the public sector where there are so many people with the authority to pay, there is a risk that creditors can be paid twice. Everybody wants to make sure that doesn’t happen.”

Currently many acute trusts and PCTs use expensive external consultants to carry out external payments matching, said Yetzes. “With the National Fraud Initiative it costs £250 as part of the national audit fee and we run data matching nationally across all our audited authorities.”

The scheme not only detects fraud and duplicate payments but, by matching against payroll data too, it can detect NHS employees who are directors of companies that hold NHS contracts but have not declared an interest. Yetzes said: “This has important governance implications.”

The Audit Commission decided not to make the exercise mandatory for PCTs because of the current reconfiguration. “We not want to impose this at a time when they are undergoing such radical change,” said Yetzes. “It may well be that some will want to crack down on this type of fraud but we do not know how many.”

Overall the NFI detected £111m worth of fraud in 1,300 public bodies in 2004-05. This included over 300 NHS employees who were engaged in housing benefit fraud and £450,000 in overpayments to private care homes claiming fees for patients who had died.

It found instances of nurses working in two full time jobs, raising questions of patient safety as well as fraud, and NHS systems where it was possible to set VAT rates as high as 100%.

The extension of the NFI to include creditor data matching was a natural progression for a scheme that has developed since 1993 when Yetzes helped local authorities in London track down the so-called ‘tube fraud’.

He said: “This was a group of people who travelled round London by tube claiming student allowances in different boroughs.” Data matching between authorities enabled local government to track the fraudsters down. This initiative developed slowly into the NFI, with the NHS coming on board with its payroll data in 1998.

Yetzes emphasised that the Audit Commission was working hard to make the data submission as easy and cheap as possible. He had yet to come across an NHS payment system that was unable to submit data directly to the Audit Commission, he said.

“We do not want to put people in the hands of IT suppliers who will say it is expensive. It is not. We will give people every opportunity to do it as quickly and cheaply as possible.” Handbooks with specifications have already been issued.

He added: “Because it is new we are giving organisations a chance to get some sample data in so that come the real download in October they will know what to do.”

Next year the Audit Commission is replacing its CD-ROM with a web-based system to feedback results to LAs and NHS organisations. Yetzes said: “A sophisticated security system will allow authorities and health bodies to access results. It will give us the opportunity to update and feed changes through overnight.”