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If you think your practice has never been embezzled, you just haven’t found out yet
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WAIKOLOA, Hawaii — A Medical Group Management Association study reported that 83% of medical practices have experienced embezzlement. Discovering embezzlement, knowing what to do about it and putting in place preventative measures were the topics of a panel here at Hawaiian Eye 2019.
The cost of embezzlement is $25 billion per year, according to the Medical Group Management Association.
“Most physicians experience it at some time or another,” Candace S. Simerson, FASOA, COE, CMPE, and then surveyed the audience to see if they believe they have ever been embezzled.
“So, this is more common than our audience thinks it is so that may mean that many of you are being embezzled and just don’t know, said OSN Chief Medical Editor Richard L. Lindstrom, MD, who was part of the panel moderated by Allison W. Shuren, MSN, JD, and Simerson.
Lindstrom said that the best way to prevent embezzlement is to be “careful with the separation of duties especially in your accounting group. So that the same person who collects the money, doesn’t deposit the money,” noting that it is “harder to get two people to collude and almost impossible to get three people to collude.”
Lindstrom recommended conducting a forensic audit in a random fashion every 2 to 3 years.
“It is expensive but if you are a big practice and a lot of money is going through your practice it might make sense to do an intense audit every so often,” Lindstrom said.
Simerson also recommended “tying all of your financial systems – your computer systems, your practice management system – to confirm that payments being made are actually being sent to your bank, so you know that the appropriate discounts and adjustments being made.”
“That reconciliation will really help you tighten up and identify issues,” she said.
“You should bring law enforcement in if you think someone has stolen from you and you want them to go to jail, unless you don’t want law enforcement looking at your records,” said former U.S. New Jersey State Attorney Paul J. Fishman, JD, “because there is a risk when you turn someone in that the investigation can take a turn that you weren’t quite expecting, so if that person turns out to be someone who doesn’t like you very much, you have to think about that just a little bit.”
Fishman alluded to his talk from the previous day about how the start of an investigation might lead to a further investigation in a different direction, for instance, Medicare billing errors. – by Joan-Marie Stiglich, ELS
Reference: Shuren AW, Simerson CS. Panel: Stories of sleepless nights. Presented at: Hawaiian Eye; Jan. 19-25, 2019; Waikoloa, Hawaii.
Disclosures: Shuren, Simerson, Lindstrom and Fishman report no relevant financial disclosures.