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One thing that no dental practice wants to face is the possibility of employee theft or fraud.

A Dental Office also Needs Fraud Prevention

In our last article, we covered the importance of financial records.  One other reason for these records is to track the problem with embezzlement.

How Big of a Threat is Embezzlement to Dental Practices?

When it comes to theft and embezzlement, no one is totally immune.  "Susan Gunn, a national speaker and certified fraud examiner, told embezzlement course attendees at the Chicago Midwinter Meeting, that three out of five professional practices are currently being embezzled.  After the meeting, Susan stated that upwards of 80% of her course attendees currently suspect embezzlement or had recently been embezzled.  'Simply stated,' she said, 'we are in a crisis.'”  If you have ever suspected that something wasn’t quite right with your office finances, there was a good chance that you were right.

Several years ago, I became suspicious of an office manager who worked in one of my satellite offices.The office’s collections were way down and I was concerned.  After reviewing the software’s appointment book, it appeared that the office manager was under collecting for my associate’s work.  I noticed that completed procedures that appeared on the appointments were, in some instances, missing from the ledger. This was especially true for the “cash” patients. I then pulled my associate dentist’s progress notes and verified my suspicion. There was a huge discrepancy between the work my associate had recorded in his progress notes and the work the office manager had recorded in the ledger. 

I next printed an audit report which informed me that my office manager was also deleting cash payments and then reentering these payments at lower amounts. Hoping that she would make a voluntary confession, I asked why she had failed to enter certain procedures and why she had deleted cash payments from the software. She then surprised me by providing a very detailed and lengthy explanation, addressing all of my questions. I wanted to believe her, but I could not ignore the information the software provided.


And so, I called the patient and informed her we were auditing our books – the patient confirmed all of my suspicions...

 How can a dental practice prevent embezzlement?


Obviously, the first line of defense against embezzlement is to hire honest people.  But beyond reviewing work history and calling references, no one can guarantee that their staff will never steal from them.

Bluntly stated, without good software, you cannot properly protect yourself from employee theft.

I would not have pursued my suspicion and caught this office manager without the detailed information provided by my software program.  I shudder to think about the amount of money that she could have stolen had I not caught her early on.

Where Dental Practice Management Software Fits In

Dental Business A good software system will allow you to set up customized security and provide the reports you need to monitor your staff.

My office uses DentiMax but Dentrix, Eaglesoft, SoftDent and other software systems also have the ability to set up customized security and provide the reports you need to monitor your staff.  This type of functionality allows you to define the areas of the software your staff members have access to and to what degree they get this access.  If you don’t want your front desk to delete ledger items without your consent, like cash payments, limit their access rights to the ledger.  You could set up the ledger so your front desk can add and edit items but not delete items.  You should also be able to print an audit report by employee.  This report will tell you what your employees have deleted or added to your software.  For example, you might run an audit report by your office manager’s name to see if cash payments have been deleted.

During the Cold War, Ronald Reagan quoted an old Russian maxim to Mikhail Gorbechev, “Trust but verify.”


Do the best you can in hiring trustworthy employees, but use your software’s capabilities to verify their honesty.  By routinely verifying that your employees are honest, your trust and appreciation for them will increase.  But, per chance you find something wrong, you will be able to take immediate corrective action before a possible problem has a chance to balloon into something large scale or is allowed to continue unabated.

Dental Practice Software and Fraud Prevention

As a practice you want to make sure that your finances are in control.  One thing that you have to consider is that in some cases, there may be fraud going on.  With the right dental practice management software, however, you can help prevent this.


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