Embezzlement & Employee Theft Can, And Probably Will, Happen To You.
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Employee embezzlement and thefts are the most common crimes in any cosmetic practice... in fact, it's pervasive.
Believe me it can and it did happen to us. It’s still hard to believe that I saw the evidence and ignored it because I just could not believe what my eyes were seeing. Instead of going with my gut instinct I listened to a mountain full of lies from my Physician Assistant so the first lesson learned is trust what your eyes are seeing and rely less on distracting noise.
When all was said and done, our P.A. had stolen over the course of just 14 months, more than $200,000 in Botox, Fillers and Laser Treatments.
How was she able to accomplish this? The theft occurred in three primary ways.
- With Botox/Dysport she would mix the proper dilution of 2.5 and then draw out a full syringe of properly diluted Botox and re-inject another syringe of saline. She would then take the syringe of Botox and put into her mini-cooler posing as a lunch box which she brought every day to keep it cold and then treat patients out of her house. The evidence of this was apparent with patients complaining of poor results. She would cover herself with some inventive lies such as; Botox out too long and I did not want to waste it, the refrigerator was not cooling to proper levels, she put the Botox in the freezer and the solution crystalized and weekend the Botox, I may have accidently put in too much saline and I used Dysport and it does not work as well as Botox. Looking back I can clearly see the evidence but listened to her lies and excuses.
- On fillers her number one excuse was that the product “leaked” while injecting and she was forced to use another syringe. Other excuses were the patient had a bad result so to keep them happy she offered a free syringe, a reaction that forced her to remove and re-inject later and I threw in some free syringes because she bought a package of Fractional Laser Treatments. Most of the time, she was simply pocketing the syringes to again inject patients of our practice at her house.
- Watch you consults and close ratios. We have been in a bad economy so this was hard to gage. She would “feel” out the patient during the consultation and those who she believed would be players she would offer discounts for Fractional Laser, IPL’s, Matrix etc. if they paid her directly in the room in cash. I was tipped off by this from a competitor who called me and told her one of their patients told them about this. After firing my P.A. within weeks we had identified 36 patients who paid cash in the room. She told those patients she was the co-owner so it was ok to pay in the room… To add insult to injury we had to complete their treatments as well.
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After having gone through this we put in some practices that I wish we had done all along. We now perform a Botox and filler audit every Friday. Every unit of Botox is logged onto a log sheet by patient and same for fillers. If we are off by more than 5% I will meet with my NP to go over the discrepancy. On lasers shot counts are logged for every patient. As an example if Mary comes in for a Fractional Laser Treatment and the beginning shot count was 45,000 and ending shot count was 45,400 then the next patient for the same treatment should begin at 45.401. We also now provide to each patient our policy of ONLY paying for services at the front desk during check out.
I was also amazed to find out that every staff member suspected what was going on but was afraid to say anything because they did not want to cause any problems if they were wrong. Lastly review your insurance policy for theft coverage. I was mortified to find that ours only covered $10,000 which left us loses of about $200,000.00. We were able to absorb the losses but many others might have been forced to lay off staff or worse go out of business. As a non-physician owner I trusted far too much that a professional medical practitioner would not steel. I now understand all too well that the white coat which commands respect could also have hidden prison stripes and to use my eyes and cover my ears…
Update: We're going to compile a report on embezzlement and employee theft in medical clinics.
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