Romania: 37 Medical Professionals Investigated for Embezzlement of Insurance Funds

In many countries that struggle with systemic corruption, basic public services such as education and health care are commonly affected by fraud schemes that siphon millions away from already underfunded services. A recent scandal in Romania illustrates how such schemes may take place, involving large criminal organisations of dozens of people seeking to divert public funds.

On March 30th, Romanian Prosecutors requested the detention of 37 persons accused of participating in a network of organised crime responsible for embezzling funds from the budget of the National Health Insurance Authority by requesting reimbursement for false medical tests. The Bucharest Tribunal placed 22 persons in preventive detention for 29 days. Ten of them are medical physicians. Among those arrested are also directors of two medical laboratories, as well as nurses and other employees. Other 15 persons under investigation in the case are not being held in detention, but have been forbidden to leave the country.

Prosecutors stated that the criminal activity primarily consisted of fraud. A number of physicians and other employees of medical laboratories are suspected of having requested reimbursement for medical tests which were never performed. In this way, they caused damages of more than 500,000 euros. Physicians are being accused of releasing approximately 14,000 false requests for medical tests, half of them on the name of around 800 patients, reported the Agence France-Presse (AFP). They allegedly received 10% of the total value as bribe.

According to the investigation, physicians often did not inform the patients, but only used their identity in drafting the false documents. “Oftentimes, they invented a fictional medical condition or one which was already present in the people’s records. In other cases, the patients were consulted and given a diagnosis, but medical employees also requested false medical investigations in addition to the ones which were actually carried out”, declared the prosecutors for Mediafax.

Sorin Paveliu, an expert of the Romanian Academic Society (SAR), explains that the Romanian health system includes hundreds of small laboratories. Meanwhile, he points out to the example of Germany where “A city like Cologne, the ‘homeland’ of the Bismark security system, has only one central laboratory, located in a skyscraper, which caters to the needs of the entire city within a 40 kilometres radius.” Paveliu underlines the efficiency of this system: “Results are sent within 2 hours by e-mail. Laboratory efficiency is consistent with the number of tests that are carried out daily”. Tens of thousands of some type of test, performed with high-technology machines, have a much smaller cost per analysis, than small-scale laboratories. There are no high costs associated with a monopoly, all costs of ‘production’ are transparent, Paveliu explains. “By contrast, in Romania, the insurers – both state and private companies – have signed contracts with hundreds of smaller and medium-size laboratories. Each of these entities is ready to bribe anyone who would ensure them a contract!”

As mentioned by Mr. Paveliu, this fraud case shows how the Romanian health care system is prone to certain corruption risks in the health sector that have been pointed out by recent studies. The British Department for International Development (DFID) has highlighted in a practice paper that a large number of dispersed actors contributes to increase the system’s vulnerabilities to corruption. In a larger network of providers, suppliers and policy makers, conflict of interests are difficult to identify and new opportunities for corruption emerge. Moreover, in systems where the public sector finances health care but provision is in part offered by private actors, overbilling the public insurance system is a common avenue for corruption, as illustrated by the recent case in Romania. Such systems require more efficient monitoring and oversight mechanisms, in order for similar cases of corruption to be successfully prevented.


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