14 Steps to Safeguard Your Practice from Embezzlement – Part II

This article is a continuation of “14 Steps to Safeguard Your Practice from Embezzlement.” If you have not yet done so, we recommend reading that article to have full context when reading this one.

Accounts Receivable and Statements

  1. Review your accounts-receivable aging report monthly. Look for changes from the previous month’s report that don’t make sense. Scrutinize any balance that is older than sixty days, as its very existence usually indicates a problem. Minimally, it means that someone dropped the ball in doing collections; at worst, it means that there’s some hanky-panky going on.
  2. Have a written policy that no balance write-offs or account adjustments are permitted without written doctor approval. If possible, consider a ‘lockout’ (in your computer software) to allow ONLY the owner the ability to write off balances.
  3. Spot-check day sheets against patient/client charts, ledger cards (or patient/client account records) and the schedule book at least once per quarter, looking for any discrepancies. That you do this sporadically should be overtly promoted to the staff.
  4. Routinely check with visiting patients/clients who have balances more than thirty days old—and with past-due patients/clients you are calling—to ensure they’ve received a statement from you. The intent is to look for incidents of the collections person throwing statements out, rather than mailing them, in order to cover a payment embezzlement.
  1. Become suspicious if you find that, all of a sudden, you are paying a lot of refund checks to patients/clients.

Accounts Payables and Purchasing

  1. Ensure all expenditures are authorized (via written request) and documented.

Safeguarding Records and Miscellaneous

  1. If you’re using paper day sheets, then remove them from the office each quarter and store them at home or in a safe deposit box.
  2. Always change the locks immediately when an employee who had access to any office keys leaves employment.

Always assume that if someone can rip you off, he/she will. So, take steps to prevent temptation and deny the opportunity. If you get that nagging feeling that something is not quite right, carefully and thoroughly check into it.


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