Another frontier of contemporary ethics is using whistle-blowers as a means to fight fraud and abuse in health care organizations. The federal government does this by increasingly relying on the False Claims Act and qui tam suits brought by whistleblowers. This article argues that this approach is dysfunctional for both the whistleblower and the organizations targeted by them. The article proposes that enhanced standards, informed by virtue ethics and utilized by independent bodies such as the Joint Commission on the Accreditation of Healthcare Organizations or JCAHO during the health care organization accreditation process, offer a better alternative to the current retributive approach now used by the federal government.
Since the mid-1990s, the federal government increasingly relied on whistleblowing as a method to control fraud, waste, and abuse in the Medicare and Medicaid programs. Although not the result of a single, specific policy decision, several factors combined to create the situation. First, in 1986, an amendment to the Federal False Claims Act made the filing of whistleblower suits much easier. Second, in 1995 in an effort to combat fraud, waste, and abuse in both Medicare and Medicaid, the U.S. Department of Justice (DOJ) implemented a new anti-fraud, waste, and abuse program called "Operation Restore Trust" or (ORT).
Elected officials and managers, working in the program offices of both Medicare and Medicaid programs and even in the general public, were confused about fraud. Waste, and abuse for years. Medicare alone lost $20 billion in 1997 to fraud, waste, and abuse, translating to a loss of 11 cents of every Medicare dollar spent in the United States (HCFA, 2000). Although we will not know the exact dollar amount of Medicare and Medicaid funds lost to fraud, waste, and abuse, a reduction of any sort in those losses will not only result in a financial savings for the taxpayers but will provide much needed increase in public confidence in the future integrity of the programs.
As a method of achieving these ends, whistleblowing is not without its hazards. For example, very often during the process of disclosure the individual whistleblower is placed at extreme personal and professional risk. Although the False Claims Act allows for potential financial gain for the successful whistleblower, many whistleblowers ultimately regret their decisions. Moreover, many of the organizations targeted by whistleblowers suffer both during and long after the original allegations (Burton, 1993; Kircheimer and Taylor, 2000).
This article argues that whistleblowing is dysfunctional for both whistleblowers and their organizations. Health care organizations, whose primary mission is to care for the sick and injured in an increasingly competitive marketplace, can ill afford such a dysfunctional situation. Yet, fraud, waste, and abuse in health care persist and public managers and policy-makers should not ignore it.
This article suggests that our health organizations need alternative methods that do not cause disruption and dysfunction to address the problem of fraud, waste, and abuse in health care. According to Fletcher, Sorrell, and Silva (1998), private health care accrediting organizations such as the Joint Commission on the Accreditation of Healthcare Organizations or JCAHO can provide a viable alternative to whistleblowing but only if the JCAHO goes beyond mere compliance with standard practice.
This article argues that the JCAHO accreditation process can provide an alternative to whistleblowing but only if it includes a strong ethical grounding in its approach to health care accreditation. This article examines the potential for virtue ethics, as first described by Aristotle and later developed by Lynch and Lynch (1997), as an ethical mindset for managers in both public and private organizations to provide just such an ethical grounding for the JCAHO standards. …