Reduce Fraud in Your Office
by Richard V . Lyschik , DDS , FAGD , CFE
We summarized in our last article that no practice is 100 % safe from fraud and that you have to make ongoing corrections to continue to reduce fraud incidents . We are strong advocates of an employee manual that promotes an antifraud culture in your practice . You should make it clear to your staff that you will pursue all fraud cases vigorously , taking appropriate disciplinary , and when necessary , legal actions when justified !
There are three types of fraud that occur in a dental practice : Corruption , Asset Misappropriation , and Fraudulent Statements . The practice owner , the spouse , a staff member , along with numerous more outside services , have all been discovered committing fraud to the detriment of many dental practices .
When it comes to fraud incidence and occurrence , dental practices are no different than other businesses of similar size . Quite shockingly , the smaller the business , the greater is the chance of fraud , and larger is the proportion of loss to the practice from fraud . Over 40 % of businesses do not recover after a major fraud incident ! fraud alert
In a dental practice , a fraud incident becomes apparent when it affects over 5 % of the practice ’ s gross income . Much fraud remains undiscovered because the suspect employee keeps the theft under that threshold amount . But over time , sheer greed , mixed with confidence that the Doctor won ’ t notice , ultimately triggers suspicion .
The longer a fraud is allowed to continue , the greater is the median loss to the practice . Compounded by the disbelief that it may be someone the doctor has trusted , the fraud discovery is often more painful than the loss of money ! We have often heard : “ But she has been with the practice for many years !” and “ The family goes to our church !”
Our largest discovery to date has been over $ 700,000 stolen by one employee , over a twelve year period , in a Texas dental office . And as we have recently read in the ADA News , when Medicaid fraud has been uncovered , settlements are often in the millions of dollars !
Our team assists with guidance to gather evidence if there is suspicion of fraud in the dental practice . The goals of a fraud investigation include :
*
Prevent further loss or exposure to risk
*
Determine if there is any ongoing conduct of concern
*
Secure evidence necessary for disciplinary action
*
Minimize and recover losses
*
Review the reasons for the incident
*
Investigate measures to prevent a recurrence
*
Determine actions needed to strengthen future responses to fraud
TIPS While investigating potential fraud :
Avoid tipping off the fraudster ! When investigation details are leaked , concealment , and destruction of evidence typically occur at a faster rate . Close the circle slowly , review and print data , interview other staff , patients , etc . and finally include the fraudster . If computer data is involved , change those passwords !
Remove the fraudster once they have been tipped off to your investigation . Relocating in the practice is most often not practical , so it is best to suspend them with pay .
Consider law enforcement assistance . If it is determined that a formal referral to law enforcement will more than likely occur , then consider notifying the authorities to determine whether law enforcement personnel should participate in the interview .
40 NORTH TEXAS DENTISTRY | www . northtexasdentistry . com