Healthcare Practice Strategies – Spring 2013 - Tips for Safeguarding Your Cash
Increasingly, medical practices are awash in cash. In fact, many practices are now generating upwards of 30 percent of total income from patients’ cash payments.
Along with that wave of checks, credit cards and cash come plenty of opportunities for funds to be mishandled and even misappropriated. With that in mind, consider these steps for effective cash handling:
FOLLOW THE 4 W'S OF CASH ACCOUNTABILITY. As you develop internal controls for safeguarding your funds, keep these four Ws in mind:
Who has access to cash?
Why do they have access to cash?
Where is the cash?
What has occurred from the transaction’s beginning to end?
SEGREGATE DUTIES. For example, ensure that staffers who enter cash into the books are not the same ones creating the deposit tickets. And use processes that provide an audit trail so you can track who is doing what and retrace the process from invoice or receipt entry through approval, posting and payment.
RECONCILE PROMPTLY (AND PROPERLY). To ensure proper accounting, reconcile payments received against the sign-in sheet and appointment schedule and against the record of daily receipts. Be sure to count and balance cash receipts daily and then compare receipts to deposit records.
SECURE YOUR ASSETS. Protecting the funds flowing through your practice also involves restricting access to cash to as few people as possible. To this end:
Minimize the amount of funds held overnight.
Lock cash (including credit card numbers) in a secure location, such as a safe or locked storage cabinet, and provide combinations and passwords only to authorized personnel.
- Consider lockbox services from your bank to reduce the amount of cash that flows through the office.
- Reconcile cash and checks separately.
- Count cash in a non-public area not easily visible to others.
- Deposit funds on a daily basis.
- Use a “buddy system” when carrying funds from one location to another.
- Conduct background checks on prospective employees.
- Consider fidelity bond coverage to protect against acts of employee dishonesty.
- Establish an anonymous fraud reporting system, such as a confidential fraud hotline.
Establishing good internal practice controls is a vital defense against theft and fraud.
Healthcare Practice Strategies – Spring 2013 Issue