Internal Controls in the Healthcare Workplace
Internal Accounting Controls in the Healthcare Workplace
In the healthcare workplace, there are many control measures put into place that must be used in order to protect the welfare of the patients and the workers who care for them. One of the specific healthcare areas in which internal controls are seen is accounting. Assets have to be safeguarded, and fiduciary responsibilities to the Board must be fulfilled (Rezaee, 2002). If the operations carried out by the accounting department in the healthcare facility are both effective and efficient, that department and the rest of the healthcare institution will be much better able to treat patients and process payments for that treatment, along with balancing the budget for the hospital and ensuring that new technology can be acquired as older, outdated technology comes to the end of its useful life. The policies and procedures that are created for an accounting department in a healthcare facility also have to accurately reflect the work processes that are being used in that facility. Without that, there would be little point to the procedures, and the policies would not be useful to the people who needed them the most and who were expected to follow them (Rezaee, 2002).
One of the most significant issues when it comes to healthcare accounting is the filing of insurance claims that are fraudulent (Carruthers & Espeland, 1992). Healthcare companies have gotten into trouble in the past for doing this, and it is a serious breach of both trust and ethics. Because that is the case, the accounting department should have a compliance program that seeks to prevent these kinds of issues from occurring (Rezaee, 2002). It is not always possible to stop these sorts of things from happening, but it is possible to provide a system that makes the fraudulent claims made to insurance companies much more difficult to get away with or to get past the internal controls and the people who are charged with processing the claims. No hospital is immune to accounting problems, of course, but hospitals that do not have any internal controls often find that they are struggling to pay their bills and that there are billing and other monetary problems taking place – many of which do not come to light until they are far advanced in nature. At that time, it is not always possible to correct them.
Internal controls in the accounting department of a healthcare institution are not things that are simply pulled out of the air. There are specific components to them, such as environment, risk, and activities (Elliot & Elliot, 2004). The environment includes issues such as integrity, competence, ethics, the philosophy of management, the operating style of the institution, and the overall culture of the organization. Risk has to be identified, but more must be done. Simply knowing the risks is not enough, as they should also be assessed and (if possible) prevented. If the risks cannot be prevented, they should be mitigated as much as they can be and any further concerns that cannot be adjusted or reduced should be issues for which the healthcare institutions has carefully prepared. When one knows what to do in a crisis, it is much easier to deal with that crisis, even if there was nothing that could be done to prevent the crisis from occurring in the first place (Dey & Lys, 2005; Friedlob & Plewa, 1996). The activities of the healthcare organization play a large part in whether it is successful in reducing or eliminating its risk. If the work is being done according to correct procedures and policies, there is some protecting from disaster and from serious problems that could arise in the future.
By making sure every employee knows what he or she is supposed to be doing, and by monitoring those employees to ensure compliance, there is less of a risk of problems with accounting in healthcare organizations. These internal controls are a valuable part of keeping things moving properly. The goal is to promote a very strong environment of control and a positive attitude when it comes to the management (Rezaee, 2002). Everyone should be able to get along and be respected members of the team, but at the same time there has to be a strong system of checks and balances that should not be ignored. This may mean that procedures and disciplinary actions sometimes appear to be a big heavy-handed, but that is a good thing in the sense of not taking chances with accounting issues. Overall, each and every person who works in accounting in a healthcare setting must be properly trained and properly qualified, and they must all follow the rules, policies, and procedures given to them by the management of the healthcare organization for which they work (Rezaee, 2002). If this is not done, sloppy work can result – which can mean serious financial and even legal trouble for the healthcare institution, especially in cases such as billing or insurance fraud.
How reliable the people in the accounting department are, and how reliable their financial reporting is, can greatly affect the bottom line of the healthcare institution (Rezaee, 2002). These kinds of issues can be important if the healthcare institution is ever audited or there is a claim that must be investigated. The point of internal controls in accounting are so that everything is done correctly, but also so that there is a record of how everything was done and by whom. That is important, since a problem in the accounting department could have multiple or different causes. It could be that a person did something wrong by accident or on purpose, but it could also be that a policy or procedure was simply incorrect (Rezaee, 2002). It may have been followed to the letter by the employees, but if it was incorrect it could have still resulted in serious problems for the institution as a whole. The people must be vetted, but so must the controls themselves. Guessing at them or not keeping them up-to-date can be nearly as bad as avoiding them altogether, and can cause just as much if not more trouble. Once internal control procedures have been established, the lines of communication regarding them must also stay open between managers and between management and employees (Rezaee, 2002).
While fraud is a word no company likes to hear, especially when it may be associated with one of its employees, it is possible that accounting fraud can occur in any healthcare company that does not have good internal controls. That is not to say it is impossible in companies where the internal controls are strong, but it is certainly much more difficult in these companies and is generally enough trouble that it is not attempted. Where controls are lax, however, there is a much higher chance of fraud. There are several ways in which employees can attempt to defraud a company within the healthcare field. Upcoding claims is one of the ways fraud is created (Rezaee, 2002). Filing insurance claims that are false and filing claims where the records have been falsified are also issues (Rezaee, 2002). When a person in the accounting department puts in an insurance claim, a system of checks and balances helps to ensure that the claim was for the right amount and the right patient, as well as for the right diagnosis and treatment. By adjusting the diagnosis or treatment the patient allegedly received, it is possible for the healthcare institution to receive more money for the claim.
While these kinds of changes to the diagnosis and treatment of a patient are certainly unethical and illegal, they can and do still happen. With strong internal controls there is less of a concern that something of that nature will take place. Getting “kickbacks” is another way healthcare accounting fraud occurs, as is mail fraud and writing bad checks (Rezaee, 2002). While those kinds of fraudulent activities can occur in any business, they are sometimes considered to be more egregious in the healthcare field because the idea is to care for and protect the patient. Clearly that is not being done and the patient’s best interests are not being kept in mind when the healthcare institution is busy figuring out how it can cheat the patient and/or his or her insurance company out of more money. Accepting kickbacks from vendors by pushing procedures, equipment, or medication that would otherwise not be needed or advised is also a serious issue that should never be overlooked (Rezaee, 2002). With good internal controls and a strong system in place to monitor employees, the incidence of these types of fraudulent practices can be greatly diminished.
Why do people in healthcare accounting departments commit fraud? There are many reasons, and they could apply to just about any person at any business. Needing money for something is the most common reason, especially when someone has an issue with a marriage or divorce, has substantial debt that he or she has accumulated, or has issues with substance abuse (Rezaee, 2002). Other people simply want to live beyond their means and see committing fraud as the way to receive extra money so they can continue to live a lifestyle they would otherwise not be able to afford. If they are angry at their managers or hate their jobs, there is also the possibility of committing fraud simply to “get back at” the person or persons they feel have slighted them. While none of these are good reasons to commit a fraudulent act, they are some of the most common reasons that have been offered when people who are committing fraud in the workplace have been caught.
Focusing on ethics can help prevent fraud, but it will not stop everyone. Additionally, more than ethics are needed in order to make sure procedures are followed properly. Often, there is no intended fraud or financial mistakes – only carelessness and misunderstandings left unchecked. Swift punishment of unethical actions along with strong information about procedures and policies can help healthcare institutions avoid financial problems. The Sarbanes-Oxley Act of 2002 helped with that by requiring full disclosure of conflicts of interest and setting other benchmarks with which companies must comply (Dey & Lys, 2005). By taking that into account, emphasizing ethics, and making policies and procedures clear, an accounting department in a healthcare institution can have strong and valuable internal controls.
Carruthers, B.G., & Espeland, W.N. (1992). Accounting for rationality: Double-entry bookkeeping and the rhetoric of economic rationality. American Journal of Sociology, 97(1).
Dey, a. & Lys, T.Z. (2005). Trends in earnings management and informativeness of earnings announcements in the Pre- and Post-Sarbanes-Oxley Periods. Evanston, IL: Kellogg School of Management.
Elliot, B. & Elliot, J. (2004). Financial accounting and reporting. London: Prentice Hall.
Friedlob, G.T. & Plewa, F. J (1996). Understanding balance sheets. New York, NY: John Wiley & Sons.
Rezaee, Z. (2002). Financial Statement Fraud: Prevention and Detection. New York, NY: Wiley
Get Professional Assignment Help Cheaply
Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?
Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.
Why Choose Our Academic Writing Service?
- Plagiarism free papers
- Timely delivery
- Any deadline
- Skilled, Experienced Native English Writers
- Subject-relevant academic writer
- Adherence to paper instructions
- Ability to tackle bulk assignments
- Reasonable prices
- 24/7 Customer Support
- Get superb grades consistently
Online Academic Help With Different Subjects
Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.
Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.
While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.
Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.
In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.
Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.
We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!
We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.
Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.
What discipline/subjects do you deal in?
We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.
Are your writers competent enough to handle my paper?
Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.
What if I don’t like the paper?
There is a very low likelihood that you won’t like the paper.
- When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
- We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.
In the event that you don’t like your paper:
- The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
- We will have a different writer write the paper from scratch.
- Last resort, if the above does not work, we will refund your money.
Will the professor find out I didn’t write the paper myself?
Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.
What if the paper is plagiarized?
We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.
When will I get my paper?
You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.
Will anyone find out that I used your services?
We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.
How our Assignment Help Service Works
1. Place an order
You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.
2. Pay for the order
Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!