What Is a Certified Fraud Examiner (CFE)?

Amber Ratcliffe
Woman looking at papers in front of a laptop

Anywhere there are complex financial systems at work, there’s a potential for abuse of those systems. In healthcare especially, fraud is something responsible providers need to be on the lookout for. It’s why many organizations choose to work with a Certified Fraud Examiner as part of their ongoing efforts to remain responsible and compliant with financial best practices.

What Is a Certified Fraud Examiner?

A Certified Fraud Examiner (CFE) is a professional who specializes in detecting, investigating, and preventing fraud within the healthcare industry. They possess expertise in identifying fraudulent activities — including billing schemes, kickbacks, insurance fraud, and embezzlement — that may occur in healthcare organizations.

CFEs use their knowledge of accounting principles, legal regulations, and investigative techniques to uncover fraudulent practices. They conduct thorough examinations of financial records, interview individuals involved, analyze financial data, and gather evidence to build cases against potential perpetrators.

The primary goal of a Certified Fraud Examiner in healthcare is to safeguard the integrity of healthcare systems and protect patients, insurance providers, and government programs from financial losses due to fraudulent activities.

Benefits of the CFE in Healthcare Compliance

Working with a CFE gives providers access to specialized skills, knowledge, and resources for effectively managing fraud risks. They can also help strengthen compliance programs and protect against financial losses due to fraudulent activities.

Here’s a look at some of the chief benefits of incorporating a CFE into your compliance efforts:

  • Expertise in Fraud Detection. CFEs possess specialized skills in identifying and detecting fraudulent activities. Their understanding of common fraud indicators, investigative techniques, and data analysis enables them to recognize and address critical compliance risks.
  • Proactive Fraud Prevention. By identifying possible fraudulent activities, CFEs can proactively prevent it from occurring! By conducting thorough assessments of internal controls, policies, and procedures, they can identify vulnerabilities and recommend preventive measures to mitigate fraud risks.
  • Effective Investigations. In the event of suspected fraud, CFEs have the expertise to conduct comprehensive investigations. They’re trained in gathering evidence, conducting interviews, analyzing financial records, and documenting findings. Their involvement ensures investigations are conducted in a systematic and thorough manner.
  • Compliance Program Enhancement. These experts can contribute to the development and improvement of healthcare compliance programs. Their knowledge of fraud risks and regulatory requirements allows them to provide valuable insights and recommendations to enhance internal controls, policies, and training programs.
  • Collaborate with Leadership. CFEs collaborate with various stakeholders — including compliance officers, legal teams, auditors, and law enforcement agencies — to address fraud and compliance-related issues. Their expertise helps facilitate effective communication and coordination, to ensure fraud prevention and detection.
  • Protect Reputation and Financial Integrity. By actively working to detect and prevent fraud, CFEs help safeguard the reputation and financial integrity of healthcare organizations. Their efforts protect patients, insurance providers, and government programs from financial losses and maintain the trust and confidence of patients.

Above all, a CFE gives providers, patients, payers, and government agencies the peace of mind that everything is on the level and above board. Working with a CFE sends a clear message: “fraud has no place in our organization.”

Common Types of Healthcare Fraud

Fraud is a straightforward concept that, unfortunately, can manifest in many ways within a healthcare organization. From sophisticated Medicare fraud to a rising prevalence of telehealth fraud, healthcare organizations need to be diligent in understanding these threats.

Here’s a look at some of the common types of healthcare fraud and how they come to be:

  • Double billing: Submitting multiple claims for the same service.
  • Unbundling: Submitting multiple bills for the same service.
  • Phantom billing: Billing for a service or supplies the patient never received.
  • Upcoding: Billing for a more expensive service than the patient received.

Keep in mind that these are just examples of provider fraud! The scope of potential healthcare fraud is vast and can span patients, third-party service providers, and general bad actors out to abuse the system.

Thankfully, for as diverse as healthcare fraud can be, CFEs are equally adept in identifying it in whatever form it takes.

Laws Governing Healthcare Fraud

When it comes to identifying healthcare fraud, no one is more knowledgeable than CFEs in understanding specifically what laws a provider (or other entity) might’ve violated. Typically, that means looking at the five main Federal laws governing healthcare fraud:

  1. False Claims Act (FCA). The FCA prohibits submitting false or fraudulent claims for payment to government healthcare programs, such as Medicare and Medicaid.
  2. Anti-Kickback Statute (AKS). The AKS prohibits the exchange of remuneration in return for patient referrals or the generation of healthcare business reimbursed by federal healthcare programs.
  3. Physician Self-Referral Law (Stark Law). The Stark Law prohibits physicians from referring Medicare or Medicaid patients to entities with which they have financial relationships, unless specific exceptions are met.
  4. Health Insurance Portability and Accountability Act (HIPAA). While most often associated with patient privacy and data security, HIPAA includes provisions related to healthcare fraud and abuse.
  5. Controlled Substances Act (CSA). The CSA regulates the manufacturing, distribution, and dispensing of controlled substances, including prescription medications.

In addition, the Federal False Statements Act (18 U.S.C. § 1001) makes it illegal to knowingly make false statements, including false statements related to healthcare matters. The Affordable Care Act (ACA) also established the Health Care Fraud Prevention and Enforcement Action Team (HEAT) and increased resources for fraud investigations and prosecutions.

It’s also important to note that healthcare fraud may also be subject to state laws, as well as regulations from agencies such as the Centers for Medicare and Medicaid Services (CMS) and the Office of Inspector General (OIG). Here again, a CFE is an invaluable resource for understanding the nuances and specifics of each law in the context of fraudulent activities.

Using Software to Centralize Documentation and Prevent Fraud

Accountability and transparency are invaluable — whether you’re working with a CFE or not. By creating and sharing policies with your entire organization, you are proactively working to prevent fraud. Having these policies and procedures documented and stored in a compliance platform, there is no excuse for employees to claim they were unaware. Compliance training focused on fraud is another great method of prevention.

Learn how MedTrainer streamlines proactive fraud prevention with document management and modern learning management system


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