This page contains a Flash digital edition of a book.
Things You Can Do to Safeguard Your Practice


Mark Divino, CPA (National Billing Partners, LLC)


With a continued sluggish economy coupled with declining reimbursement, physician practices need safeguards in place to ensure their assets are fully protected. Theft, embezzlement and general mismanagement of assets continues to plague many practices. The purpose of this article is to give practices some practical applications that can help detect and ultimately discourage mishandling of practice assets.


Due diligence on new employees is essential


Before hiring a new employee to the practice, there are some steps that should never be omitted. The following procedures should be performed on all new hires:


• Thorough reference and resume checks on prospective employees.


• Background checks that include state criminal records, social security number check and national felony warrant searches.


• Conduct credit checks for employees who will be handling money or other fiscal related duties such as patient credit card information.


Strong internal controls will help the practice avoid surprises


A practice should consider implementing the following items to strengthen its internal controls. A strong system of internal controls will not only detect irregularities but can be a very powerful deterrent.


• Segregation of duties – For example, one employee may open the mail and endorse checks, while the bank deposit is prepared by someone else.


• Cross training employees will ensure that no “one” person can perform a certain task.


• Have a detail set of Policy and Procedures which outline the duties each employee performs. These should be updated and reviewed by everyone on a regular basis.


• Draft a code of conduct that state the practice’s core values and guidelines on operating ethically and require every employee to sign it. Perhaps this can be done on an annual basis in conjunction with ethics training.


• Setup an anonymous whistle blower hotline using a third party.


• Make certain that all employees take their vacations. An employee who never takes a vacation is a red flag in that they could be potentially hiding something.


Make sure billing and collections operations are sound


There are certain best practices that all billing and collections operations should have which include:


• Superbills should be sequentially numbered and accounted for daily.


• Reconcile charges and receivables on a daily basis.


• Create or strengthen bad debt/write- off policy on who can approve and post uncollectible receivables.


• Restrict access to the practice management/billing system to enable employees to only access functions they need to perform their tasks.


• Enforce system password changes on a periodic basis such as quarterly.


• Performance monitoring – monitor billing and collections activity and review key performance indicators (KPI’s) such as collections ratios, days in A/R, A/R aging percentages, refund activity, denial rates and patient volumes.


• Consider outsourcing the billing and collections function as a reputable firm should have a strong system of internal controls in place.


Well designed cash management procedures help prevent theft


Perhaps the most at risk asset in a physician’s practice is cash. By implementing the procedures outlined below, the risk of theft can be mitigated.


• Perform daily reconciliation of bank deposit against receipts in the billing system; then monthly reconciliation against the bank statement and accounting system.


• Make sure check stock is locked up and has limited access; keep an inventory log and periodically audit for missing checks.


• Direct all checks and payments that come through the mail to a bank lock box.


• Checks that come into the office should be immediately stamped “For Deposit Only”.


• Review payroll and accounts payable reports on a random basis.


• Randomly verify vendors to ensure that that are legitimate.


Is your practice at risk?


For a free assessment of your practice’s internal controls or if you would like an evaluation to see if you are maximizing your reimbursement, please contact Mark Divino, CPA at 888-608-7999 or mdivino@mybillingpartner.com


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31