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Medical offices vulnerable to employee theft

Earlier this month, an office manager at a family practice in North Carolina pled guilty to embezzling more than $1 million from her employer. A 20-year employee, she stole the money over an 11-year period. She has been ordered to pay restitution and was sentenced to four to five years in prison with at least five years supervised probation following her release.

The North Carolina family practice is hardly alone in being victimized by its own employee. Last fall, the Medical Group Management Association (MGMA) released a report on employee theft and embezzlement at medical practices. The report found that nearly 83 percent of respondents had been affiliated with a medical practice that had been the victim of employee theft or embezzlement.

[See also: Experts identify ways to avoid hospital fraud, embezzlement.]

Donald Elton, a pulmonary and critical care physician in South Carolina and author of “How to Steal from a Medical Practice,” says the MGMA’s survey percentage is likely to be closer to 100 percent. “Most of them (medical practices) just don’t know,” he says. “I like to say it’s the perfect crime because the doctors aren’t looking.”

Elton’s office manager stole $20,000 from his business over a period of a year-and-a-half. He wanted to prosecute the woman who had been employed at his practice for 12 years and had worked her way up to the position of office manager, but because the stealing was her first offense, local authorities persuaded Elton to settle for pre-trial intervention. The practice received restitution, but Elton’s sense of outrage was not soothed. The woman left his practice, he says, and within a week was hired as a billing manager at another specialty practice.

“The police call this crime a breach of trust,” he says. “The people most likely to steal are the people you are least likely to suspect: The ones that are the long-time, loyal employees. They don’t like taking time off, and there are reasons for that. (They) tend not to take a lot of vacation time; tend to work extra hours; tend to be there late; tend to arrive early; tend to be the hard worker types that do just about everything for you. So all that kind of stuff suckers you in and facilitates their ability to steal from you. . . . We really felt slapped in the face.”

Stealing is easy to do and there are many ways employees can steal, Elton says, from pocketing co-pays and not processing the paperwork that would send up red flags about missing money from an office visit to spending more time on Facebook than doing the work they’re paid to do.

Elton’s experience has made him vigilant. He has installed software on his practice’s computers to monitor every mouse click and screen looked at by his employees. He has taught himself billing and controls access to the mail that comes into the practice.

“I think (stealing is) endemic in these professions, unfortunately. I get kind of a sour mood (thinking about it). I’ve hired enough people to know that it’s a very, very rare person you can really trust. I think it’s safer not to trust any of them,” he says. “There’s too much temptation.”