“I think practices let it go because getting into an all out fight with an individual will likely end up damaging the practice for more then the stolen amount, even $20k, if that individual enlists all their friends and family to badmouth the practice online and in the area, you will likely loose much more then $20K worth of business not to mention any potential legal/marketing fees/stress.“

Practice Owner

Confronting a dental embezzler: “I’ll just let her go”

Most dentists when they are forced to confront a dishonest employee will often say to themselves, “I’ll just let just let her go.“

They believe the best solution to their dishonest employee problem is to simply terminate the person’s employment and move on.

I get it, no one enjoys confrontation.

Confrontation is unpleasant. We often take great strides to avoid it, especially dentists.

Some dentists avoid accusing their employee of embezzling for fear of retaliation.

“She’ll badmouth the practice.”, says one.

If your employee is stealing from the practice, whether you choose to “just let her go” or to terminate her employment for theft, she will bad mouth you and your practice anyway.

“Her friends and family will badmouth the practice online.”, says another.

It’s unlikely her friends and family will start badmouthing you online, and if by chance they do, then they’ve committed libel. A properly worded letter from your attorney can resolve the matter.

Most dentists fear confronting their employee.

Some doubt they will have “enough proof” to fire their employee.

Others fear being sued for wrongful termination. (keep reading to learn how to fire a dishonest employee)

It’s not hard for dentists to rationalize that the best solution to their employee dishonesty problem is to terminate their employment and move on.

“I’ll just let her go and everything will be fine.”

Maybe, but doing this can be a costly and emotionally draining decision.

Here are some things that can go wrong when you let a dishonest employee go without any accountability.

YOUR EX-EMPLOYEE IS HIRED BY ANOTHER OFFICE

Soon after firing your employee, you learn they were hired by another dentist. Ugh… “your problem” has now become “their problem”.  Chances are your ex-employee will soon be up to her old tricks with her new employer.

Chances are the other dentist is an alumnus of the same dental school, or in a study club you are yearning to join, or a member of your association.

Paths will cross at some point in time. Can be awkward.

Your ex-employee “bad-mouths” you and YOUR PRACTICE

There is a high probability that your former employee will start to bad-mouth you and your practice the moment she walks out the door.

She’ll bad mouth you at her new workplace and to her friends.

Some go so far as to make false accusations, like saying you abuse drugs, alcohol or even children.

Others will say that you committed fraud, have a psychological disorder, or are a gambling addict.

They do this to tarnish your reputation in order to build a wall between you, her friends and the new office where they work.

THEY CAN CONTINUE TO STEAL FROM YOU AFTER THEY ARE GONE

While your ex-employee worked for you, she likely could have accessed information about you, your employees, your business affairs and personal life.

Dishonest employees have been caught taking patient and business records.

The ex-employee can use this information to withdraw money from your bank account, obtain credit lines or credit cards in your name. (yes, this is easier to do, and has happened more often, than you may think. )

You can unexpectedly be billed for things you did not purchase. For example, when an ex-employee has access to online accounts (like Amazon) and starts racking up orders.

Ex-employees can use credit card information they took from from you, your employees or patients to commit additional frauds, even months after they have been fired.

YOU ARE SUED FOR WRONGFUL TERMINATION

Every dishonest employee feels self-entitlement towards their employer’s money, and that self-entitlement does not stop after they have been fired.

If you accuse a dishonest employee of stealing and terminate their employment, they may hire an employment lawyer and threaten to sue you!

This is what happened in one of my previous cases . (for brevity, the details have been left out)

This dentist suspected his employee was stealing and because he was in an “at will” state, he decided he could simply fire the employee.

The dentist confronted the employee, told her she was for stealing and said “your fired!”

The newly fired employee promptly filed a wrongful termination lawsuit.

After being served with a claim, the dentist hired me to perform a fraud examination to confirm if his suspicions were correct.

I uncovered over $60,000 in theft and submitted my report to the dentist.

The dentist used my report as ammunition to defend himself in the ex-employee’s wrongful termination lawsuit.

It did not go well.

The judge told the dentist that the theft was not admissible.

The court ruled that because the theft was discovered after the employee was fired, it was not admissible.

The dentist lost the wrongful termination lawsuit and was ordered to pay $80,000 in damages to his former employee.

He subsequently had to file a counter suit for damages.

YOUR PATIENTS START TO COMPLAIN

Dishonest employees use various methods to conceal their thefts.

Most will conceal their dirty work by adulterating the patient ledgers and billing records.

Soon after the employee has left the practice, patients can begin to complain about their account statements are not correct.

“I already PAID THIS! Why are you sending me a bill.”

“Why did my insurance company send this to me?”

Your staff may not know how to properly respond to patient complaints like this. Patients can (and do) lose faith in the office.

“If they can’t keep my account balance (or insurance) straight, how can they do dentistry?”

OOF! – YOUR UNEMPLOYMENT TAX GOES UP

In many states, being fired for theft will stop your employee from receiving unemployment payments. (i.e.: fired for cause)

If you decide to terminate a dishonest employee’s employment without cause, your former employee can file for unemployment benefits and you can see an increase in your Federal Unemployment Tax payments.

That’s like being ripped off twice!

PATIENTS LEAVE YOUR PRACTICE

If a dishonest employee has been with the practice for many years, they will have developed friendships and relationships with many patients.

Dishonest employees have been known to “help” patients by not charging for certain services, or giving patients discounts for bringing in cash (which they steal), or creating a false culture of insurance entitlement amongst patients by fraudulent billing.

After the dishonest employee is no longer in the practice, patients can start to ask questions:

“Why is Erin not working here anymore?”   

“What happened to Janie, where is she gone?”  

The patients are often unaware that their favorite employee was stealing from the practice.

All they remember is that the employee was really nice to them, and they did not have to pay as much out of pocket.

The implications can result in a negative impact on the practice goodwill. Some patients may decide to leave.

INSURANCE COMPANIES START ASKING QUESTIONS OR WANT TO AUDIT

It is common for dishonest employees to commit healthcare fraud by over-billing insurance companies for work that was not done. 

These fraudulent billing schemes can go on for months or years under the watchful eye of a dishonest employee.

When working in the practice, a dishonest employee can respond to questions from patients and insurance companies in order to create the illusion that everything is in order

When the dishonest employee has been fired, there is no one to deflect questions from insurance companies and patients.

The replacement staff are not prepared either.

JUST “LETTING HER GO” SENDS THE WRONG MESSAGE TO STAFF AND PEERS

Some or all of employees who remain with in the practice after the dishonest employee was “let go” without any consequence will feel that you made an unethical decision to not hold the dishonest employee accountable, and fire her for theft.

How to terminate the employment of a dishonest employee

USE A “REVERSE ONUS” APPROACH

Warning: I am not a lawyer and this should not be taken as legal advice. :-)

The safest approach is to provide the employee with an employment suspension letter giving notice to the serious allegations that have been uncovered, and to provide the employee with 2 business days to respond to the allegations contained in the letter.

If the employee fails to respond, or their response is not satisfactory, then the employer will exercise its right to terminate employment accordingly.

The written allegations must be clear and compelling, to ensure the employee is unable to provide a meaningful response that can absolve them of dishonesty.

Using the reverse onus approach, if the employee commences legal action against the employer, there is a paper trail to show that the employer gave the employee every opportunity to explain their conduct, and they failed.

Have a question?

I am always happy to help dentists and practice owners. If you have questions or concerns, do not hesitate to contact me for a consult.

Contact Bill

How to mentally prepare yourself before terminating employment

Lisa Mergens has some good suggestions on how to mentally prepare for an employment termination, written from the perspective of when you are firing someone without cause.