Recent news stories about manager embezzlement give us all a black eye. What can managers do to limit their liability, and how can physicians protect the practice without managing the day-to-day operations themselves?
Here are nine suggestions:
Perform a thorough background check before hiring a manager, and have your manager bonded.
Have your bank statements sent to the physician’s home address and/or make sure the physician has the master access to the bank accounts online. Physicians, have a personal relationship with your practice banker and make time for a short meeting with them quarterly.
Have the physician sign your practice checks. Each check should be attached to an invoice that lists the goods or service purchased. Do not order a rubber stamp of the doctor’s signature.
Insist on a duplicate, numbered receipt book for staff to give receipts to patients for all over the counter payments.
Have your insurance and patient checks sent to a lockbox.
Make sure the manager takes time off ”“ at least several weeks a year. Managers who are “too busy” or “can’t ever get away” are a red flag. The physician should review all mail during the manager’s vacation.
Check the monthly credit card statement carefully before making the payment. Keep the card restricted to a relatively low limit to manage your liability. Do not pay practice bills routinely on the card to build frequent flyer miles as this makes it much easier for an employee to hide non-approved expenditures.
Have a budget and make sure variances can be explained.
Hire a CPA to review the books quarterly. Even if you do not need the services of a CPA for your statement reconciliation, taxes or partners distribution, hire one to review the expenses and receipts, and ensure that the retirement plan is being funded appropriately.
A qualified, ethical manager has nothing to hide and will thank you for following these nine rules. The rules protect the manager as well as the practice.
collects mail delivered to a special practice Post Office Box (typically only payments)
opens the mail and discards the envelopes
separates the checks from the accompanying paperwork
scans or copies the checks and the accompanying paperwork
itemizes the checks on an electronic or manual deposit slip
deposits the checks in the practice’s bank account or makes scanned copies available to the bank
returns the original checks/paperwork to the practice, or holds it in-house for a period before shredding
makes the electronic or paper copies accessible to the practice for posting to the practice management system
Pricing for this service varies based on number of pieces processed and number of functions applied to the mail. Advantages of using a lockbox include faster deposit of daily monies and elimination of staff involvement in check-handling and making deposits.
My practice spends about $9,000 a year going to the bank. That’s what it costs for the time it takes for one person to open the envelopes, separate the checks from the EOBs, add the check totals, stamp the backs of the checks, copy/scan the checks, write the deposit slip and go to the bank on a daily basis.
Now my practice is evaluating one old option and one relatively new option. The lockbox has been around for a long time, but as technology has become more sophisticated and less expensive, and time has become more valuable, the lockbox has seemingly become more affordable. Evaluating it now, it seems like a great deal to have someone else perform all the steps listed above as well as having the check and EOB images stored online for easy access.
The newer option is the check reader that scans and uploads the check image to your bank, depositing a group of checks in the bank from the comfort of your own office. BusinessWeek had a good overview of this technology in a video recently. Click the link below to see the video.
if you’re spending too much money depositing your money, maybe you should call your banker.