This book brings an unusual opportunity to explore the peculiarities of America's health care industry's approach to fraud control, when compared with the financial services sector, credit card companies, or the Internal Revenue Service-all of which have to defend themselves against fraud.

Criminal fraud must be factored into the current debates about health care reform, budget deficits, and proposed Medicare/Medicaid cutbacks. As a polity, how can we make good public policy if we don't know how much of the nation's one trillion dollar health care budget is being lost to fraud? The amounts are staggering, measured in hundreds of billions of dollars, but nobody knows for sure exactly how much is being lost. Malcolm Sparrow, an expert on fraud control, reviews how the health care industry approaches the problem and concludes that fraud is rampant, largely uncontrolled, and mostly invisible to policymakers. The problem will only get worse, he says, unless the industry at all levels changes its priorities, its strategies for uncovering and preventing fraud, and its technological approach. Many believe that electronic claims processing will save billions of dollars and that managed care will eliminate the major categories of fraud. By contrast, Sparrow shows how electronic claims processing could lead to unprecedented fraud losses, and how managed care makes fraud much more dangerous to human health. The final section-prescriptions for progress-is a must for policymakers at every level, and for anyone with an interest in the science of fraud control more broadly, in any context.

The National Institute of Justice (NIJ) is the research, development and evaluation agency of the US Department of Justice. The NIJ is dedicated to improving knowledge and understanding of crime and justice issues through science. NIJ provides objective and independent knowledge and tools to reduce crime and promote justice, particularly at the state and local levels. Each year, the NIJ publishes and sponsors dozens of research and study documents detailing results, analyses and statistics that help to further the organization's mission. These documents relate to topics like biometrics, corrections technology, gun violence, digital forensics, human trafficking, electronic crime, terrorism, tribal justice and more. This document is one of these publications.

"The Regulatory Craft" tackles one of the most pressing public policy issues of our time --the reform of regulatory and enforcement practice. Malcolm K. Sparrow shows how the vogue prescriptions for reform (centered on concepts of customer service and process improvement) fail to take account of the distinctive character of regulatory responsibilities --which involve the delivery of obligations rather than just services.In order to construct more balanced prescriptions for reform, Sparrow invites us to reconsider the central purpose of social regulation --the abatement or control of risks to society. He recounts the experiences of pioneering agencies that have confronted the risk-control challenge directly, developing operational capacities for specifying risk-concentrations, problem areas, or patterns of noncompliance, and then designing interventions tailored to each problem. At the heart of a new regulatory craftsmanship, according to Sparrow, lies the central notion, "pick important problems and fix them." This beguilingly simple idea turns out to present enormously complex implementation challenges and carries with it profound consequences for the way regulators organize their work, manage their discretion, and report their performance. Although the book is primarily aimed at regulatory and law-enforcement practitioners, it will also be invaluable for legislators, overseers, and others who care about the nature and quality of regulatory practice, and who want to know what kind of performance to demand from regulators and how it might be delivered. It stresses the enormous benefit to society that might accrue from development of the risk-control art as a core professional skill for regulators.

The current crisis in policing can be traced to failures of reform. "Sparrow surely is right to condemn policing directed only at crime rates rather than community satisfaction." -The New York Times Book Review In the past two years, America has witnessed incendiary milestones in the poor relations between police and the African-American community: Ferguson, Baltimore, and more recently Baton Rouge, St. Paul, and Dallas. Malcolm Sparrow, who teaches at Harvard Kennedy School of Government and is a former British police detective, argues that other factors in the development of police theory and practice over the last twenty-five years have also played a major role in contributing to these tragedies and to a great many other cases involving excessive police force and community alienation. Sparrow shows how the core ideas of community and problem-solving policing have failed to thrive. In many police departments these foundational ideas have been reduced to mere rhetoric. The result is heavy reliance on narrow quantitative metrics, where police define how well they are doing by tallying up traffic stops, or arrests made for petty crimes. Sparrow's analysis shows what it will take for police departments to escape their narrow focus and perverse metrics and turn back to making public safety and public cooperation their primary goals. Police, according to Sparrow, are in the risk-control business and need to grasp the fundamental nature of that challenge and develop a much more sophisticated understanding of its implications for mission, methods, measurement, partnerships, and analysis.

Policing, environmental protection, and tax administration have much more in common than practitioners in these areas often recognize. Their cultures and traditions have, for the past few decades, incorporated a classic enforcement mentality, based on the underlying assumption that a ruthless and efficient investigative and enforcement capability would produce compliance through the mechanisms of deterrence. In these fields, and perhaps in many other enforcement or compliance oriented professions, Sparrow believes the traditional enforcement approach is under stress. There are too many violators, too many laws to be enforced, and not enough resources to get the job done.

In this book, Sparrow draws out remarkable parallels in the ways these professions are adapting to meet their current challenges, as they reject their traditional reliance on retrospective, case-by-case, after-the-fact enforcement. Rather than perpetuating their dependence on processes, procedures, and coverage, these professions are each developing new capacities for analyzing important patterns of noncompliance, prioritizing risks, and designing intelligent interventions using a much broader range of tools. Sparrow extracts the essence of the transformations underway, explores the critical implications for information management, and lays out the issues that need resolution before the emerging compliance strategies can reach maturity. This book is required reading for all those concerned with either the theory or the practice of the compliance side of government.

Policing, environmental protection, and tax administration have much more in common than practitioners in these areas often recognize. Their cultures and traditions have, for the past few decades, incorporated a classic enforcement mentality, based on the underlying assumption that a ruthless and efficient investigative and enforcement capability would produce compliance through the mechanisms of deterrence. In these fields, and perhaps in many other enforcement or compliance oriented professions, Sparrow believes the traditional enforcement approach is under stress. There are too many violators, too many laws to be enforced, and not enough resources to get the job done.

In this book, Sparrow draws out remarkable parallels in the ways these professions are adapting to meet their current challenges, as they reject their traditional reliance on retrospective, case-by-case, after-the-fact enforcement. Rather than perpetuating their dependence on processes, procedures, and coverage, these professions are each developing new capacities for analyzing important patterns of noncompliance, prioritizing risks, and designing intelligent interventions using a much broader range of tools. Sparrow extracts the essence of the transformations underway, explores the critical implications for information management, and lays out the issues that need resolution before the emerging compliance strategies can reach maturity. This book is required reading for all those concerned with either the theory or the practice of the compliance side of government.

Drawing on the experiences of innovative police departments that have tried new approaches to policing in cities as diverse as Los Angeles, Newport News, Virginia, and London, this important book assesses what can be done by enterprising police chiefs and progressive communities to combat the crime and violence that currently engulf our cities.

How should we deal with societal ills such as crime, poverty, pollution, terrorism, and corruption? The Character of Harms argues that control or mitigation of 'bad' things involves distinctive patterns of thought and action which turn out to be broadly applicable across a range of human endeavors, and which need to be better understood. Malcolm Sparrow demonstrates that an explicit focus on the bads, rather than on the countervailing goods (safety, prosperity, environmental stewardship, etc.) can provide rich opportunities for surgically efficient and effective interventions - an operational approach which he terms 'the sabotage of harms'. The book explores the institutional arrangements and decision-frameworks necessary to support this emerging operational model. Written for reflective practitioners charged with risk-control responsibilities across the public, private, and non-governmental sectors, The Character of Harms makes a powerful case for a new approach to tackling the complex problems facing society.

Who steals? An extraordinary range of folk--from low-life hoods who sign on as Medicare or Medicaid providers equipped with nothing more than beepers and mailboxes, to drug trafficking organizations, organized crime syndicates, and even major hospital chains. In "License to Steal," Malcolm K. Sparrow shows how the industry's defenses, which focus mostly on finding and correcting billing errors, are no match for such well orchestrated attacks. The maxim for thieves simply becomes "bill your lies correctly." Provided they do that, fraud perpetrators with any degree of sophistication can steal millions of dollars with impunity, testing payment systems carefully, and then spreading fraudulent billings widely enough across patient and provider accounts to escape detection. The kinds of highly automated, quality controlled claims processing systems that pervade the industry present fraud perpetrators with their favorite kind of target: rich, fast paying, transparent, utterly predictable check printing systems, with little threat of human intervention, and with the U.S. Treasury on the end of the electronic line. Sparrow picks apart the industry's response to the government's efforts to control this problem. The provider associations (well heeled and politically influential) have vociferously opposed almost every recent enforcement initiative, creating the unfortunate public impression that the entire health care industry is against effective fraud control. A significant segment of the industry, it seems, regards fraud and abuse not as a problem, but as a lucrative enterprise worth defending. Meanwhile, it remains a perfectly commonplace experience for patients or their relatives to examine a medical bill and discover that half of it never happened, or that; likewise, if patients then complain, they discover that no one seems to care, or that no one has the resources to do anything about it.Sparrow's research suggests that the growth of capitated managed care systems does not solve the problem, as many in the industry had assumed, but merely changes its form. The managed care environment produces scams involving "underutilization," and the withholding of medical care schemes that are harder to uncover and investigate, and much more dangerous to human health. Having worked extensively with federal and state officials since the appearance of his first book on this subject, Sparrow is in a unique position to evaluate recent law enforcement initiatives. He admits the "war on fraud" is at least now engaged, but it is far from won.