Cuts To Fraud & Audit Jobs Mean Millions Of Health Dollars Overpaid Or Stolen Will Be Lost

Underfunded frontline health services will be further impacted

The ability of Health NZ to claw back millions of scarce health dollars lost to fraud and overpayment each year will be undermined by proposed cuts to the jobs of audit and fraud experts.

The Audit Assurance and Risk team is a critical Health NZ Te Whatu Ora unit focused on ensuring some $12 billion of annual funding of the primary health care sector is paid out correctly and not subject to fraud.

But Health NZ is proposing to remove 23 roles, a cut of 28% of the workforce, at a time when the health dollar has never been scarcer.

"We see every day how underfunded the health system is so cutting the very team that claws back overpayments and tackles fraud makes no sense," said Fleur Fitzsimons, National Secretary for the Public Service Association for Te Pūkenga Here Tikanga Mahi.

"By not detecting overpayments or cracking down on fraud, it means precious health dollars are not being used for their proper purpose of improving outcomes for patients no matter where they are in the health system.

"The system will just be ripe to be exploited by more fraudsters and the loser will be all users of the health system from patients to clinicians.

"This is just more evidence of how poorly thought through many of the spending cuts we have seen throughout the public sector have been.

"The Government has imposed a health funding crisis in this country and should be doing all it can to make the health dollar go further, including properly funding the health system in the first place.

"These workers are highly specialised auditors and fraud investigators who save the Government millions of dollars each year - it’s simply penny wise and pound foolish to scrap these roles.

"Each year they carry out audits and fraud investigations of those receiving health funding like medical clinics, midwives, pharmacies and disability support providers to ensure the money is being used correctly for the specified purposes.

"The amount saved in salary cuts pales beside the loss of money not being clawed back with a minimum of 80 providers or fraudulent actors not being held to account each year. These experts are good at what they do, recovering $6 for every $1 invested in the team. One audit recently recovered $6 million from a provider which was overpaid.

"But they face a big challenge. The team estimates that Health NZ is currently losing at least 3% of the $12 billion of annual provider funding due to civil and criminal fraud and error - that’s a huge loss of $360 million annually.

"Part of the problem is that the payment systems at Health NZ are antiquated, but you don’t fix that by axing the very people who are doing their best to save scarce health dollars.

"The PSA calls for these proposed cuts to be reversed."

PSA submission to Te Whatu Ora Audit & Assurance Consultation Document

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