Protect yourself and your business! Don’t become the victim of dental embezzlement
You went to school to become a dentist and worked hard to move up in your field. You eventually opened a private practice because you love what you do and want to provide quality dental care to as many patients as possible.
However, if you are like many dentists, you may have forgotten one important fact — when you opened your practice, you also became a small business owner. Small business owners must make the commitment to not just do what they do best — in your case, dentistry — but also stay on top of every single part of their business.
Yes, that includes the business finances.
You likely pay certain members of your staff well to handle the accounting side of things, but don’t be naïve enough to completely turn a blind eye to cash flow. Too many dental practice owners do this and are shocked when they discover they’ve been the victims of dental embezzlement.
Dental embezzlement is such a widespread issue because too many dentists make it too easy for less-than-honest employees. The practice owner is often too hands-off with money and after a while, certain dental office employees begin to test the waters and learn what they can and cannot get away with. Some employees may have a hidden agenda to steal from the moment you hire them, while others may develop a plan over time if they are having money problems and assume you’d never miss a few hundred bucks.
You can, however, create a workplace that doesn’t set the perfect stage for an employee to steal from you. The American Dental Association notes that there are four conditions in a workplace that provide opportunities for fraud. The conditions are:
- Poor internal controls
- Too much control limited to specific employees
- Lack of supervision by management
- Failure to pre-screen employees accurately
Get involved, take control, and make sure your employees know you’re the boss, and you’re in charge of the growth of your business. The more involved you are, the less likely they are to try and pull the wool over your eyes.
Identifying Dental Embezzlement in Your Practice
Acts of embezzlement are not a one-size-fits-all type of deal. Some employees are experienced with committing this type of fraud, while others are not. Some will stick to basic embezzlement techniques, while others will create elaborate schemes. However, the American Dental Association states that there are certain types of fraud that are more common in health care:
Billing – 35%
Example: An employee orders too many supplies on purpose, returns the extras, and keeps the refund check.
Cash larceny – 29.7%
Example: A patient pays in cash and that money goes right into the employee’s pocket.
Skimming – 21.6%
Example: A patient is charged the correct amount, but when entered into the system, the employee notes a small (fake) discount and keeps that extra money.
Payroll – 13.5%
Example: An employee lies about the number of hours they worked to receive a bigger paycheck.
Expense reimbursement – 5.4%
Example: You send an employee to a conference, and when they submit information for reimbursement, they inflate mileage driven or submit fake receipts.
But you can’t imagine any of your employees committing acts like these, right? Unfortunately, that’s exactly how embezzlers want you to perceive them. Individuals who make the decision to embezzle do not usually fit the stereotype of the average criminal. In fact, they’re often thought to be some of the best employees. Employees who embezzle are usually described as:
- Very well liked by both staff and patients
- Extremely hard-working and committed to their job
- Rarely taking days off
- People who have a lot of responsibility within the practice
- Appear to live beyond their means
- They like to be in charge and are very territorial
Think about your dental office staff and which employees may fit the above descriptors. Have these individuals ever been questioned about discrepancies and fired back with angry (but seemingly valid) excuses? Have they ever faced financial issues in their personal lives, like major debt, bankruptcy, or gambling addiction? Do patients complain about accounting issues? You may have an embezzler on your hands.
Take Control of Your Dental Practice
You own a dental office because you love being a dentist, but you have to remember the other side of the coin — you’re in business to make money. Don’t let a dishonest employee with sticky fingers walk away with the cash you’ve worked so hard to earn.
The first step toward stopped dental embezzlement is opening your eyes to what goes on every day in your business. By being an engaged, present, and invested employer, you’ll be more likely to catch incidents of embezzlement and even put a stop to them before they happen.
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