ACE Dental Software Blog

Using Dental Software to Prevent Practice Embezzlement - Part 4

In this, part four of our series, we will look at another method an employee can use to embezzle money from a practice. This method involves changing the procedure fees.

When the patient is checked out, the employee may enter all of the procedures, fees and payments exactly as they should be entered with one small difference. The employee could reduce the fee.

For example, let's suppose the procedure was a crown with a normal fee of $1000. If the employee knows the patient is going to pay $200 in cash, the employee could change the fee to $800 and pocket the cash.

Even if the employee is not given permission to edit or delete transactions, they still may be able to change the fee before it is posted. This type of activity is much less likely in a practice where the doctor carefully monitors production and collection reports. But of course, all embezzlement activity is less likely when the doctor is focused on the business.

Sometimes, when the schedule is full and the activity is hectic, it's difficult to stay focused on the business. In those situations, the ACE Dental program has a solution for this situation.

The solution is called the "Changed Fee Report". Anytime a procedure is posted to a patient with a fee that is not to be listed in the fee schedule, that transaction is flagged and will appear on the Changed Fee Report.

Like the deleted/edited transaction report, this is a secret report, that is, it is not mentioned in our documentation. Access to this report is only given to the doctor. 

Using Dental Software to Prevent Practice Embezzlement - Part 3

In this, part three of our series, we will look at another method an employee can use to embezzle money from a practice. This method involves editing or deleting transactions.

When the patient is checked out, the employee may enter all of the procedures, fees and payments exactly as they should be entered. Perhaps, even a walk-out statement may be printed. If the employee has been given permission through the security system, any or all of these transactions can be deleted or edited to show a lesser amount charged and paid. The employee can then keep the money.

Let's talk for a minute about the security system. Most dental software programs allow an administrator to set up permissions for each employee. Of course, the ACE program has the ability to limit who in the practice can enter transactions, edit transactions and delete transactions. This may give some a false sense of security. It is an unfortunate fact that many dishonest employees are some of the most trusted employees. These of the employees who are most likely given permission for this type of activity.

The first line of defense in preventing this type of activity lies in the normal reporting system. The doctor should review the production report, collection report and day sheet every day. The doctor should look for any discrepancies. If any patient was seen and does not appear on these reports, an explanation should be forthcoming. If any of the fees seem suspicious, further investigation is warranted.

The second line of defense lies in the audit trail. The best dental software programs always provide an audit trail of all transaction activity. ACE Dental Software provides this in a deleted/edited transaction report. This is a secret report, that is, it is not mentioned in our documentation. Access to this report is only given to the doctor. This is a powerful report that keeps a copy of every deleted transaction. In addition, the report keeps a before and after copy of every edited transaction. If an employee is using this technique to embezzle from the practice, this report will catch them red-handed.

The B and A types are Before and After edits. The D type is a deleted transaction.

Using Dental Software to Prevent Practice Embezzlement - Part 2

In part one, we explored the most common way an employee can embezzle from a practice. That method was to simply not record an appointment and keep the payment. The second most common method of embezzlement involves the inappropriate use of adjustments.

When a patient is checked out, it is very easy for an employee to lower the amount owed by entering a simple adjustment. This can be done after the patient has been checked out and a walk-out statement printed. If the patient has paid any cash portion, the adjustment can be for part or all of the cash and the employee will pocket that amount. Some employees have been so bold as to offer the patients an unauthorized cash discount to encourage the patients to pay in cash.

 

Even if there is no cash payment involved, and the patient pays with a check, then the check may be held for later use. The employee can substitute that check on another day when there is a comparable amount of cash. The employee simply keeps the cash and the check offsets the shortage.

How can the doctor use dental software prevent this activity? Most dental software programs offer an adjustment report. In the ACE program, simply pull down the report menu and click on adjustment report. Enter the date range (it will default to today's date). All adjustments made for that date range will appear on the report. The doctor should view this report at least weekly if not daily. By watching that report over time, the doctor can get an idea of what is normal and what is abnormal activity on that report.

 

Some dental software programs offer additional security measures. In the ACE program, we can set permissions to determine who can and cannot enter adjustments. If you log in as administrator, and select a given staff person, you are presented with a list of permissions. If you uncheck the Enter Adjustments box, the staff person cannot enter adjustments. They will then have to ask

another employee who has this permission to enter the necessary adjustments. This can be an enormous deterrence to any unscrupulous use of adjustments.

Using Dental Software to Prevent Practice Embezzlement

This blog will be the first in the series concerning practice embezzlement and how you can use dental software to prevent it. While many dentists would like to think that this is a topic that will never affect them, nothing could be further from the truth. It is been estimated that 80% of all practices have been or will be victims of embezzlement. Embezzlement amounts have ranged from $50 to over $1 million. Duration of embezzlement has ranged from days to over 10 years. The average detected embezzlement is approximately $100,000. If the doctor is not diligent, embezzlement is easy with very low risk of punishment. In fact, one study showed fewer than 20% of guilty employees were prosecuted.

We will start with the easiest and most common way an employee can embezzle from a practice. If a patient visit is not recorded, the payment can be handled by the employee in any manner they choose. If there is a cash payment, the employee will simply pocket the cash. If there is a check payment, the employee can set aside the check. This check can be used later when another recorded appointment pays with cash for an amount comparable to the check. The employee can pocket the cash from the latter appointment and substitute the check from the previous appointment to make a deposit balance.

How can the doctor detect this type of activity? Some dental software offer features that help detect this. In the ACE program, whenever you run the daily reports such as production, collection or day sheet, a button appears on the screen to allow you to check for missing appointments.

This will create a report comparing every patient that was checked out during the day with every patient on the appointment book. If anyone was appointed on that day and does not appear checked out, that patient will appear on that report.

This is a quick and easy check that should be performed every day. It could mean the patient canceled their appointment, it could be the patient slipped out the door without checkout, or it could be something more sinister.

If an employee wants to avoid detection with this report, they may simply delete the appointment.

There is a simple way to detect this. Under the appointment book menu, simply select appointment list.

 

 

At the bottom of this report, select missed appointments. This will provide a list of all deleted appointments. If you click on the column for appointment date, the report will be sorted in appointment date order.

By clicking the second time, the most recent entries will appear at the top. In just a few seconds, we can tell if anyone who was treated that day has a deleted appointment.

This is only one of many ways an employee can embezzle from a practice. In future blogs, we will explore other ways.

Use Dental Software to Preblock the Appointment Book

It has been estimated that dental practices can get as much as 20% increase in production simply by effective utilization of preblocking. Preblocking means blocking time on the appointment book for primary procedures. 

Why is this important? Let's look at some numbers. If a practice wants to produce $1 million per year, assuming the doctor works 46 weeks at 4 days per week, that works out to close to $5500 per day. Virtually the only way to meet this kind of production goal is if half of the production each day comes from primary procedures. However, if the day is filled with secondary and tertiary procedures, the primary procedures must be delayed until the schedule allows the appointment. 

If preblocking is used to reserve a calculated number of appointment slots for comprehensive care and quadrant dentistry, performing multiple procedures when possible, these types of procedures can be booked sooner and production goals can be met more easily. Many practices like to block time each morning when the energy level for the staff is higher. There is usually sufficient diagnosed treatment sitting in the charts to fill many of these times. Advanced dental software programs like ACE allow you to search pretreatment items to find patients for these appointments. 

If categories are chosen for each appointment type, the "Search for next available appointment" function will honor the preblock categories in the book. The search function allows you to override the preblock for the next "x" days. This defaults to two days, but you can specify any number you want.

To see more about preblocking in ACE, click here.

Use 10 minutes intervals when scheduling appointments

Would you like to work an extra week and a half every year and not get paid for it? That's essentially what many practices are doing today because they continue to schedule appointments using 15 minute intervals.

By using 10 minute intervals, we can schedule much more accurately. Many procedure require 20 minutes or 40 minutes, for example. Using 15 minute intervals means we don't schedule enough time if we use 1 or 2 units respectively (15 or 30 minutes). Or, more likely, we're wasting time if we schedule using 2 and 3 units (30 and 45 minutes) for these types of appointments. 

Ten-minute units will now offer greater flexibility and result in increased productivity. Studies have shown that the average practice can schedule up to a week and half more appointments simply by switching from 15 to 10 minute intervals.

As a side benefit, the studies have shown patients will arrive more promptly when given a 9:10 appointment as opposed to a 9:00 appointment. It shows the practice is striving for greater efficiency and is also more respectful of the patient's time.

Most dental software programs today allow you to setup your practice to use 10 minute intervals for increased efficiency.

Dental software makes sending electronic claims easy.

Many dental practices are avoiding the use of electronic claims (e-claims). The word "electronic" scares them. They think it would be too complicated. Well, nothing could be further from the truth.

With only one or two mouse clicks, a whole days worth of claims can be sent. And, within seconds, a report will show if any claims are rejected and why. Those claims can be fixed immediately and resent. Attachments can also be sent electronically. The software makes it easy to track claims through to payment. As an added benefit, dental software allows a practice to check patient eligibility online.

The two biggest advantages of this service is efficiency of staff time and faster reimbursement. Most e-claims are paid in 7 days. Since the claim is settled faster, the patient balance can be resolved sooner. 

Not only is the patient happier, the accounts receivables are lower. This means fewer write-offs and better profitability.

In summary, the practice saves money on paper, printing, envelopes and postage. The staff is freed to do more productive and profitable tasks, like recalling overdue patients and spend quality time to interact with your patients. The patients are happier. Quick resolution means less write-offs and more profit.