Open Bar: The Wolf in Sheep’s Clothing – Trusted Employees Who Go Rogue

Question: What steps can healthcare providers take to run an efficient practice and keep staff’s hands out of the cookie jar?

Response: 

Whether professional office staff members are minding patients, records or the till, healthcare providers may be negatively impacted by, and ultimately responsible for, the acts or omissions of their employees. One provider recently discovered that an employee was storing medical records in the office ceiling. The provider said, “She was working for me for 12 years!” This revelation came to light when ceiling tiles had to be removed to install a sprinkler system.

Another provider, who paid for a clerical worker’s nursing education, determined that she was cashing patients’ checks for co-payments and pocketing cash payments. Numerous providers have suffered at the hands of trusted office staff who abused their position and stole prescription pads or sample medications, wrongly accessed or shared protected health information or committed insurance fraud by submitting fabricated bills for services the provider never performed. Larceny, check tampering and fraudulent billing could potentially be devastating to professionals and their practice.

Although delegation of tasks to hired personnel is the only way to run a busy practice, providers must remain vigilant, be involved in every aspect of their office operations and refrain from tossing caution to the wind. Oversight is obviously essential. A hands-on approach to consistently evaluate staff who are entrusted to act on an employer’s behalf is the key to minimizing liability exposure and/or asset depletion. Many studies of employees’ behavior have concluded that it is mainly the most trusted, long-time staff member who may turn out to be a wolf in sheep’s clothing.

Lack of internal controls is one of the most prevalent causes of fraud. Proactive monitoring and analysis, fraud training, anti-fraud policies, codes of conduct and periodic surprise audits to reduce fraud losses are crucial for a practice’s smooth operations. The presence of a robust system of anti-fraud controls is a powerful deterrent in the fight against fraud by office staff.

It is speculative as to whether even the most vigorous audit policies would have led a provider to check overhead ceilings for patients’ records. However, it is proof positive that anyone can cut corners, bend the rules, be enticed into self-enrichment and commit the unimaginable. Providers must consistently practice due diligence to avoid compromising patient information, assets or their professional license. Complacency spells danger, and providers must never let their guard down.

MLMIC policyholders can reach out to our healthcare attorneys for questions about liability risks associated with personnel or other healthcare law inquiries by calling (877) 426-9555 Monday-Friday, 8 a.m.-6 p.m. or by email here.

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This document is for general purposes only and should not be construed as medical or legal advice. This document is not comprehensive and does not cover all possible factual circumstances. Because the facts applicable to your situation may vary, or the laws applicable in your jurisdiction may differ, please contact your attorney or other professional advisors for any questions related to legal, medical or professional obligations, the applicable state or federal laws or other professional questions.