There are more ways to separate you from your money than you can imagine. Some are small and seemingly trivial (see Prevent Embezzlement by Sweating the Small Stuff). Other methods are bigger and more costly.
Big-Ticket Theft
Big-ticket theft is a less common but important and potentially very costly form of embezzlement. Simple theft is extremely common in the physician practice. Office supplies can disappear in surprisingly large quantities. Larger items, including furnishings, office equipment, or computers can also disappear. Physically smaller and easier to steal, medical supplies and medical equipment theft can be costlier. The monetary cost associated with the loss of bigger ticket items is obviously larger but, individually, not incapacitating, although it is still consequential. In most cases, these items will be missed, but there are also smaller items that can be taken with less chance of detection. Losses could easily be in the tens of thousands of dollars.
Employees with a key can remove expensive items by taking the items themselves or, more likely, by providing a copy of the key to an accomplice as in a practice we know where the office manager walked in on a Monday morning to find all the office chairs were missing. A single chair possibly doesn’t matter but opening the office after hours to have the furnishings cleared out is potentially devastating. Not only are you faced with large monetary losses, but office productivity suffers for days or weeks.
Stealing computers not only is a direct monetary loss that risks loss of the data, which is potentially far more costly. Without advanced information and cybersecurity protocols and adherence as discussed in the Using Health Care IT section of this website, the data breach could cost many thousands of dollars. Direct and secondary costs of this type of embezzlement could cripple and perhaps even destroy a practice. The associated problems can last for months, draining revenue and manpower.
Medical Equipment
Medical equipment is sold every day on-line. Much of it is legitimate. Some of it is hot. When you purchase used equipment from another practice, be sure to confirm with that practice that the sale is legitimate. View the sale of specialty medical equipment by an individual with healthy skepticism. Staff members who deal with the equipment or order the supplies are in an excellent position to appreciate the value.
Medical Supplies
Equipment loss is fairly obvious; whereas a slightly increased rate of supply use, could rapidly run into the thousands of dollars, but might take months or years to uncover. Some medications have a clear street value. For example, botulinum toxin costs hundreds of dollars per vial. The vials can be sold to other providers or used in so-called cosmetic parties. Controlled medications such as narcotics or sedatives are a topic unto themselves. These types of medications may be taken for subsequent sale or personal use.
Prevention
Create an environment of team accountability and security. Careful monitoring of the drug sample closet and the medication refrigerators is vital. Limit access and keep the area within easy line of sight of other staff members.
The Employee Handbook must have specific policies regarding equipment and medication security. See our checklist on how to Make Embezzlement More Difficult With HR Practices too!
At Smart Business Great Medicine, our motto is Trust, and Verify!
We hope understanding the ways theft and loss can occur helps you build and maintain your defenses.
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