Many physician practices leaders believe their trusted employees would never steal from them, but statistics show that embezzlement is far more common than most doctors realize.
Indeed, 83 percent of practice administrators said in a 2009 Medical Group Management Association (MGMA) survey that they had been associated with a practice where there was an employee theft, Medscape reports.
While practices lose $25 million to employee theft and embezzlement annually, according to 2010 data from the Association of Certified Fraud Examiners, the median loss is $5,000. Numbers can soar much higher, however, considering that 17 percent of the thefts went undiscovered for more than two years.
The problem is perpetuated on three fronts, according to experts:
Practices fail to take steps to prevent embezzlement. These steps include but are not limited to:
- Ensure that two people count all cash
- Maintain a cash log and reconcile it against deposits monthly
- Set a limit for the amount of petty cash to be kept in the office
- Compare practice account records to online banking information
Thieves get away with their crimes. While 82 percent of the embezzlers connected with the MGMA survey were fired, just 29 percent were prosecuted. "Doctors worry about being sued for making a false accusation. If the employee leaves the practice and moves on, many doctors just don't want to pursue it," Laurie Morgan, a senior consultant with Capko and Morgan, a practice management firm in Thousand Oaks, California, told Medscape.
Practices miss signs of theft. Embezzlers often steal in small increments over time, through various schemes, making it easy for practices to attribute small losses to declining reimbursements. But when any amount of money is disappearing without explanation, practices should conduct a thorough reimbursement analysis to find the source of the problem.
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