Don't Get Fleeced!
With so much focus on increased competition, the risk of lawsuits and diminishing reimbursement rates, there is one financial threat to private medical practices that is all too often ignored: employee theft or embezzlement. According to the Medical Group Management Association (mgma.com), more than 82% of healthcare professionals have been affiliated with a medical practice victimized by embezzlement.1 More than 75% of facilities affected were independent medical practices, and the majority of perpetrators were employees who worked at the practice for more than three years.
Embezzlement can take many forms, from stealing retail products or petty cash to more complex financial schemes that can rob a facility of tens or even hundreds of thousands of dollars. Typical forms and methods of embezzlement include:
• Stealing cash payments before cash receipts are recorded
• Fraudulent disbursements, such as forging a company check or using a signature stamp
• Submitting inflated or fictitious business expenses
• Manipulating payroll to create a fictitious employee or to inflate pay rate or hours
• Opening a fictitious account and depositing refund checks to a fictitious patient
• Paying a bill twice and pocketing the resulting refund
• Giving a busy doctor a number of checks to sign at once, including an extra one for a fraudulent expense
• Purchasing supplies or equipment that the employee keeps for herself
Embezzlement frequently begins when an employee “borrows” some money with the intent of paying it back. When no one notices the missing funds, the money isn’t paid back. The need “to borrow” grows and, over time, the embezzled dollars can add up to significant amounts.
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