Doing Business An Analysis of the Columbia HCA Fraud
My goal is to relate the case to the subject of Business Ethics and derive important lessons on how business should be conducted.Reading through the case study, we can discern the numerous causal factors of the federal investigation of Columbia/ HCA. From what I can understand, the investigation was brought about by a combination of internal and external factors which is presented below:It was started in June 1996 by Treasury Secretary Robert Rubin that the Medicare program will go broke by 2001 with the way funds are being spent. Expenditures were increasing exponentially with $160 billion for the 1994 fiscal year. That’s about $440 million per day. By the year 2003, it is projected that it will mushroom to $380 billion or $1 billion per day according to the Congressional Budget Office. As a general observation, any activity that increases or decreases suddenly is subject to the curiosity of other people especially when it involves large amounts of money. This being the case, it only took a matter of time before it caught the attention of government authorities who have become very keen on finding ways to eliminate unnecessary expenditures and catching fraudulent transactions.The arguments used by the managers to justify the large increase in Medicare costs were the increase in efficiency, more expensive equipment, and better accounting practices. These arguments alone are enough to stir speculations because Medicare expenditures should rise due to the rise in harder-to-treat diseases requiring more expensive medication. Does it make sense then that there was an increase in acute and chronic diseases when the health care service became more efficient? Does it mean those doctors in the past misdiagnosed patients and when Columbia/HCA came into the picture, they suddenly became experts in diagnosis?Whistleblowers are those that expose the anomalies of their employees, partners, and co-employees. Anomalous activities, in this case, refers to fraudulent acts that cheat the government (and consequently the taxpayers) of their money.