The former head of fraud detection in the NHS has said that the healthcare system could be losing as much as £1bn a year from fraud while procuring services, often from private companies.

Jim Gee, the former director of counter-fraud services for the Department of Health and chief executive of the NHS Counter-Fraud Service, said the health service was missing out on huge potential savings by cutting the budget for research and investigations into the problem.

His report highlights how NHS Protect, the national fraud prevention and investigation body, has had its budget cut by about 30 per cent since 2006. He also accused the Government of cutting back on fraud measurement exercises.

Mr Gee said: “Fraud is one of the last great unreduced healthcare costs. Putting money into it makes absolute sense. It is one of the least painful ways of cutting costs, before you cut the quality, or extent, of patient services.”

Although it conducted 15 fraud measurement operations between 1998 and 2006, the NHS has done only two since 2009. Given the resulting shortage of data, Mr Gee based his estimates on procurement fraud on the lowest average loss rate in other industry sectors, which is 5.8 per cent.

Major areas of healthcare fraud were likely to involve dentists, who received £3bn from the NHS in 2013. In the case of fraud by suppliers of dentistry services, Mr Gee used average losses identified in previous NHS inquiries, which showed suspected losses of 4.03 per cent. That would indicate losses of £137m.

Milsted Langdon’s head of Dental Services, David Jacobs, is a member of the National Association of Specialist Dental Accountants & Lawyers (NASDAL), meaning we are able to draw on a wealth of knowledge and expertise from accountants and lawyers around the country who, between them, act for over 5,000 dental clients in the UK. To find out how our specialist accountants for dentists can help you, please contact us.