Medical Malpractice News

Safeguard Your Practice with Basic Controls

Tags: | Comments: 2 | April 20th, 2011

As a physician, your schedule is more hectic than most.  So, if you are like many doctors, you have probably turned over the financial details of your practice to staff.  In a practice without adequate internal controls, that decision could cost you.  Every practice will vary to some degree, but the following basic controls will go a long way towards ensuring that assets are properly accounted for and safeguarded against potential misappropriation.

  • Bond all appropriate practice employees.
  • Use a bank lockbox for payer and patient deposits.
  • Segregate job responsibilities; the person receiving cash should not be posting payments to patient accounts.
  • Reconcile receipts to sign-in sheets and appointment books on a daily basis.
  • Maintain pre-numbered patient charge tickets and account for the numerical sequence daily.
  • Reconcile daily cash posting to the bank statement.
  • Monitor contractual adjustments – look for unusual trends that don’t fit the pattern of the practice profile.
  • Require physician approvals for all bad debt write offs.
  • Have a physician review and approve all vendor invoices and sign all checks.
  • Forbid the use of a signature stamp.
  • Periodically review endorsements of cancelled checks for any anomalies and investigate accordingly.
  • Ensure proper computer password protection procedures are in place and properly enforced. Employees should only have access to those programs necessary for them to perform assigned job responsibilities.

Implementing some basic controls can offer peace of mind that your assets are being adequately protected.  Besides, it’s your money at the end of the day…why not protect it!

Contact Information
314-655-5564
rkrieger@amdcpa.com
www.amdhealthcare.com
www.graymatterblog.com

Comments

2 thoughts on “Safeguard Your Practice with Basic Controls

  1. @ben_utley

    Hi Richard, nice post. I’ve also heard that the bank statement is a crucial control point, and that only a highly trusted person- a partner perhaps- should receive bank statements directly and review them contemporaneously. Is this right?

  2. Richard Krieger

    Absolutely. Having the bank statements sent to an owner/partner or trusted individual within the practice who is not involved in the cash processing transactions is an excellent fraud prevention/detection control. Depending on the size of the practice, some owners may have the statements sent to their outside accounting firm for review. While having the statements sent to an independent party is an important control, the person reviewing the statements also needs to be alert for specific items such as unknown payees, missing checks, checks issued out sequence and other unusual items.

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