Keep an eye out for these red flags for possible embezzlement at your medical practice:
• Carl Frost, founder of Frost & Co., a healthcare consulting and accounting firm, advises physicians to keep an eye on the office manager who writes all the checks and makes all the deposits, in addition to other factors. "Collections aren't on an automated billing system. The same manager [who] handles all payroll functions and has a home computer for doing work from home," is a recipe for trouble, he says. "I've never had a client practice that had all those things going on and not been the victim of embezzlement."
• If your billing staffer refuses to take a vacation, be aware that this is a common trait among employees who embezzle, experts say. Insist on a vacation, and use the time to check over the employee's work.
• Watch and listen to your employees on a daily basis. Pay attention to sudden displays of wealth or, conversely, admissions about major financial setbacks, such as a spouse losing a job.
• Staffers who recommend friends or family for jobs in the practice. Though some companies actually encourage staff referrals, many practice experts say it's a bad idea because the pair could work together to embezzle, or because one relative might be reluctant to turn in another.