1. Integrity and Corruption in the Health Sector:
General Introduction
Dr Musa Ajlouni

2. What is Integrity ?
http://www.quotespicture.org/integrity-quotes-17.html

3. What is corruption?
“Abuse of entrusted authority for
private gain.”
(USAID Anticorruption Strategy 2005)
Logo from a Moldovan NGO working on anti-corruption

4. Corruption in the health sector
“Actions of stakeholders within the health
system mandated with governance and
regulatory roles, or those that have a role
in the delivery of services and/or providing
inputs to the system, which are not legally
provided for and which do or have the
potential to do damage to the public or its
interests.”
Source:Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

5. Corruption in the health sector
Corruption in the health sector is a
concern in all countries, but it is an
especially critical problem in
developing and transitional
economies where public resources
are already scarce”

6. Corruption in the health sector
Health system corruption is less likely
in societies where there is broad
adherence to the rule of law,
transparency and trust, and where the
public sector is ruled by effective civil
service codes and strong
accountability mechanisms.
Source: William D. Savedoff and Karen Hussmann(2005).The causes of Corruption in the Health
Sector.

7. High corruption vulnerability in
the health sector
• High degree of imbalances of
information
• Inelastic demand for services
• Providers choose services for patients
(Supply induced demand )
• Health professionals have assumed a
cultural role as trusted healers who are
above suspicion

8. • Services are highly individualized
making it difficult to standardize and
monitor service provision( clinical
freedom)
• The uncertainty of the health market
• The complexity of health system
High corruption vulnerability in
the health sector

9. Impact of Corruption in the health
sector
• Reduces the resources available for
health
• Lowers the quality, equity and
effectiveness of health care services
• Decreases the volume of services
• Increases the cost of provided services

10. Source: Five key actors in the health system Source: Savedoff and Hussmann, Chapter 1, The causes of corruption in the health sector, in Transparency International (ed.),
Global Corruption Report 2006.
Five key actors in the health system

11. How are corruption and
fraud manifested in the
health sector?

12. § Pharmaceutical companies can skew
research studies, influence review
boards or simply bribe regulators to
approve or speed up the processing of
their applications.
§ Health care providers and facilities may
be tempted to pay a regulator to
overlook lapses in licensing
requirements.
Regulators (ministries of health,
parliaments, supervisory commissions)

13. Payers/Financers (Public and Private)
§ Decisions may be made to favour regions
governed by political allies, rather than
following criteria of equity and efficiency.
§ The public insurer can also allocate
resources for political gain and at the
expense of patients or taxpayers.
§ Private insurers: fraudulent billing. May bribe
insurance regulators to ignore illegal
practices.

14. Health care providers (hospitals, doctors,
nurses, pharmacists)
Providers may act in ways that are
not in their patients’ best interests,
whether motivated by direct
financial gain, increased prestige,
greater power or improved working
conditions.

15. Health care providers
§ When providers are paid ‘fee-for-service’
it is in their financial interest to provide
more services, and more costly services.
§ When paid on a ‘capitated’ basis they
may provide fewer services .
§ When paid a fixed salary there is a
tendency to be less productive and
provide less care.

16. Health care providers
§ Publicly employed health providers may:
• Abuse job by referring patients to their
parallel private practice (or use public
facilities and supplies to serve their private
patients)
• Absenting themselves to provide private
consultations elsewhere.
• Steal drugs and medical supplies
• Take bribes from patients for services that
are supposed to be free.

17. Health care providers
§ They may create ‘phantom’ patients to claim
additional payments.
§ They can order tests to be conducted at private
laboratories in which they have a financial stake.
§ They may prescribe expensive drugs in
exchange for kickbacks or bribes from
pharmaceutical companies.
§ Non-qualified health care providers who pass
themselves as qualified and provide services
that they are not qualified to provide (Quackery).

18. Health care providers
§ Health facility officials may accept
kickbacks to influence the
procurement of drugs and supplies,
infrastructure investments and
medical equipment. In so doing, they
may pay higher prices or overlook
shoddy work.

19. Patients
§ Patients may try to get free or subsidized care
by underreporting their personal or family
income.
§ Patients may misrepresent their enrolment in an
insurance plan by using the insurance cards of
friends or family members.
§ A patient may bribe a doctor to obtain benefits
for non-health issues, such as a health
certificate to obtain a driver’s license, to avoid
military service or to obtain disability payments.

20. Suppliers
§ A range of practices are commonly used
by pharmaceutical companies as
incentives to encourage the use of their
product such as distributing free samples,
gifts, sponsored trips or training courses.

21. Suppliers
§ Suppliers may bribe procurement officers
to authorize low quality equipment or
repackaged expired medications. They
can persuade providers to use their
products at inflated prices, even when
cheaper, equally effective alternatives are
available.

22. Suppliers
§ Suppliers can bribe public health
authorities in any of their normal
procurement processes, including
kickbacks from companies that want to win
profitable hospital construction tenders
Source: Global Corruption Report 2005

23. Suppliers
§ Suppliers can bribe regulatory agencies to
develop policies in their favor. For
example, pharmaceutical companies may
influence governments to prevent generic
drug manufacturers from competition, or
equipment producers may try to change
regulations so that licensed facilities will
be required to purchase their products.

24. Corruption Categories
§ Practices which involve measures that
usually lead to monetary gains.
§ Non-monetary, which involve unethical
behaviors that are not primarily geared to
monetary benefit in the short term but in
due course would lead to some form of
benefit.

25. Monetary Corruption
1.Financial leakages
2.Siphoning of public funds for private gains
3.Illegal profits
4.Benefits
6.Incentives
7.Pilferage
8.Illegal fees
9.Kickbacks
Source: Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

26. 10.Informal payments
11.Petty corruption – over out allowances
12.Procurement frauds/irregularities
13.Theft of supplies and equipment
14.Over-invoicing and over payments
15.Clever book keeping
16.Overpayment for supplies
17. Graft and padding of bills
18. Selling public positions and bribes
Monetary Corruption
Source: Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

27. Non-monetary Corruption
1. Failure to base decisions on evidence
2. Deliberate lack of oversight by public officials
3. Deliberate inattention to mechanisms that
compel accountability
4. Preferential treatment to well connected
individuals
5. Unfair hiring practices and nepotism
6. Collusion/favoring amongst bidders in the
contracting process
Source: Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

28. Non-monetary Corruption
7. Inattention to staff accountably for misconduct
8. Use of public leverage/power for the benefit of
private practice
9. Illegal and unethical marketing practices
10. Managerial reluctance to confront physicians
11. Staff Absenteeism
12. Ghost workers
13. Shaving off duty hours
Source: Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

29. Underlying Causes of Corruption
• Lack of clear standards of performance for
providers
• Lack of effective auditing and supervision
• Limited enforcement of rules/no sanctions
• Lack of accountability and oversight
• Lack of citizen involvement and of local
oversight and authority
• Absence of monitoring and evaluation

30. Remedies
• Government-wide anti-corruption stance;
• Culture of public service;
• Procurement and contracting rules, and
enforcement of rules;
• Public standards of conduct and
oversight;
• Effective enforcement of rules and
rewards/punishment for behavior;

31. Remedies (cont.)
• Improvement in civil service rules, pay and
review;
• raise quality of public management of
health services;
• Reform of provider units (TQM) – health
providers input to raise productivity and
performance;

32. Remedies (cont.)
• Allow accountability at health service
delivery unit to stem petty theft and
improve management potential
• Improve fiscal oversight with
consequences for unlawful practices

33. Two basic strategies to address
corruption
• "Discipline-based approach" (top-down)
– Laws, policies and procedures against
corruption with adequate punitive consequence
for violation
– Attempts to prevent corrupt practices through
fear of punishment
• "Values-based approach" (bottom-up)
– Promotes institutional integrity through
promotion moral values and ethical principles
– Attempts to motivate ethical conduct of public
servant
Department of Medicines Policy and Standards
September 2007 – Good Governance for Medicines 33,WHO

34. Challenges
• Cultural change is difficult;
• Physicians hard to influence;
• Oversight is costly and complex;
• Some level of corruption emerges in most
health systems;
• Without controlling corruption health
system is compromised in eyes of the
public.

35. Corruption: a Global Issue

36. World Wide: Some Examples
An average of 5.59 percent of annual
global health spending is lost to fraud.
Based on WHO estimates that global
health care expenditure is about
US$4.7 trillion, this translates into
about US$260 billion lost globally to
fraud and error.
UNDP (2011).fighting Corruption In The Health Sector Methods, Tools And Good Practices.

37. Germany
§ In the mid-1990s, Germany investigated
450 hospitals and more than 2,700 doctors
on suspicion of taking bribes from
manufacturers of heart valves, life support
equipment, cardiac pacemakers and hip
joints.
Source: Savedoff and Hussmann, Chapter 1, The causes of corruption in the health sector, in Transparency International (ed.), Global
Corruption Report 2006.

38. Demands to punish corrupt doctors
(Germany)
§ Germany's state-backed insurers are
demanding prison sentences of up to three
years for doctors who accept bribes or
other gratuities: (Cooperation with
pharmacies and pharmaceuticals )
Source:http://www.dw.de/demands-to-punish-corrupt-doctors/a-16493639

39. Pakistan
§ A cross-country survey showed that 95% of the
population perceives that the health sector is
corrupt.
§ Another survey showed that the frequency of
informal payments to public health care
providers amongst the users of services is 96% .
§ Staff absenteeism and dual job holding is
amongst the most serious issues at a health
systems level in Pakistan.
Source: Nishtar S. Corruption in the health sector in Pakistan. Heartfile and transparency International; 2007.

40. China
In China and many former communist
countries of Eastern Europe and Central
Asia, the apparent existence of illegal
payments has led observers to conclude
that the health care system has been
‘privatized’, that it functions like a private
health care market and is only nominally
public.
Source: Transparency International’s Global Corruption Report 2006 :Corruption and paying for health care.

41. USA
The US Department of Health and Human
Services has given estimates that
government programs lose 10 per cent of
their funds through fraud each year, an
annual sum close to US $50 billion.
Source: Transparency International’s Global Corruption Report 2006 :Corruption and paying for health care.

42. Albania
§ Informal payments to doctors and nurses
are the single type of corruption that most
Albanians are familiar with and have
engaged in. News stories and word of
mouth in Albania report numerous stories
of poor patients being admitted to hospital
but largely ignored by the medical staff
because of their inability to pay informally.
Maranaj Marku. Albanian Health System Financing And Corruption .Council of Europe Expert July 2010

43. § It is a frequent practice for doctors to
intentionally avoid using public facilities
and equipment for patient examinations,
instead referring patients to private
providers of the same services,
with which the doctor has links.
Albania
Maranaj Marku. Albanian Health System Financing And Corruption .Council of Europe Expert July 2010

44. Integrity Score and Rank for Jordan,2012
Score: 48 Rank : 58/176
Source: Transparency International's 2012 Corruption Perceptions Index http://www.transparency.org/whatwedo/pub/corruption_perceptions_index_2012

45. Corruption Perception Index in the Arab Region,2012
818174Somalia37988Morocco
1317173Sudan41875Tunisia
1816169Iraq44666Saudi A
2115160Libya44666Kuwait
2314156Yemen47561Oman
1313144Syria48458Jordan
3012128Lebanon51353Bahrain
3211118Egypt68127UAE
3410105Algeria68127Qatar
Score
Arab
Region
Rank
World
Rank
CountryScore
Arab
Region
Rank
World
Rank
Country

46. Corruption Perception in
Jordan(2006 Survey).
Public Sector
Private Sector

47. Estimated Annual cost of health
Corruption In Jordan
• Total health expenditure in 2009 was
estimated at 1610 million JD / third on
pharmaceuticals.
• Estimated spending that is lost to
fraud (WHO 6 %):96 million JD is lost
annually as result of fraud in Jordan(32
millions on pharmaceuticals)

48. In Jordan
“..physicians/prescribers overall are
quite susceptible to promotion by
pharmaceutical manufacturers and
there is a culture of prescribing
branded new medicines, even where
older medicines with cheaper generic
equivalents exist and are scientifically
proven to be as effective and safe.”
Source:Samia Saad, MeTA Jordan Int.(2010).
A model Standard Treatment Guideline (STG) for Essential Hypertension and Improving
Rational Use of Medicines in Jordan.

49. Prescribing and dispensing
behavior in Jordan
§ “The prescribing behavior of physicians
[and dispensing behavior of pharmacists]
are the primary reason for the high level of
drug consumption in Jordan, changing the
prescribing behavior [and dispensing
practices] of providers is a necessary
condition for achieving overall cost
containment objectives”. (p.12 of NHA 2007)

50. Purchasing of Medications
There are some specific aspects of the
procurement process that are at higher risk
of inefficiency and potential corruption, such
as the local purchases of medications and
medical supplies especially amount below
the JD200 limit and as well the purchases of
medications paid through reimbursement by
the Health Insurance Administration.
Source: UNDP Study about Integrity Assessment in the Health Sector: Public procurement in
Jordan,Dec.2011

51. A study on Assessment of Current Situation of Home
Health Care Services in Jordan Revealed:
Prevalence of some unethical
practices that included: hiring of
unqualified workers, commission and
“split fees”, enticing and luring clients,
providing unnecessary services, etc.
Musa Ajlouni And Hania Dewani (2012).Assessment of Current Situation of Home Health Care Services in Jordan,
Scientific Research Support Fund

52. THANK YOU