The Fraud Act of 2006 states a person is in breach if they intend ‘to cause loss to another or to expose another to a risk of loss ’, therefore there does not have to be a financial loss for fraud to have taken place, exposing the NHS to the risk of loss is still considered to be fraud. We need to examine direct losses, as well as where the NHS may be at risk of loss. By capturing the estimated financial vulnerabilities in thematic areas, the NHSCFA and stakeholders can develop robust prevention strategies to prevent actual financial losses from fraud.
Various methods are used to calculate how financially vulnerable each thematic area is to fraud, bribery, and corruption and in some instances, methods are combined. The loss method applied to a thematic area is dependent on stakeholder engagement, available data, landscape, process, and policy. Methods include:
- Loss measurement exercises – These take the form of an in-depth analysis and measurement of a particular area to provide a statistically robust percentage of how much funding/reimbursement is vulnerable to fraud. This method provides the NHSCFA with the highest confidence.
- Comparative loss assessments – Where the NHSCFA has not directly measured the financial vulnerability, we are reliant on vulnerability percentages derived from partners or stakeholders. These would not be 100% comparable, however they are the most relevant without a loss measurement exercise available.
- Collaboration with policy holders – Where a percentage of fraudulent activity is established through the study of recent data, legislation, and changes to landscape.
- Baseline financial vulnerability rate – A legacy percentage of fraudulent activity which is applied due to no availability of a recent loss assessment, comparative loss assessment or guidance from policy holders. Improvements could be made through stakeholder collaboration.
The probability yardstick
To ensure a consistent approach to assessing the probability and/or uncertainty of reports and intelligence detailed within the SIA, the NHSCFA uses the ‘probability yardstick’. When using the measure of probability, the NHSCFA has considered the source, age and frequency of reporting around a common theme / MO.
| Likelihood of occurrence | Remote chance | Highly unlikely | Unlikely | Realistic possibility | Likely / probable | Highly likely | Almost certain |
|---|---|---|---|---|---|---|---|
| Percentage range | 0% - 5% | 10% - 20% | 25% - 35% | 40% - 50% | 55% - 75% | 80% - 90% | 95% - 100% |