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U-M Health System hit with $4.3 million fine for years of drug law violations

pills spilling out of pill bottle

The University of Michigan Health System has been hit with a $4.3 million fine for violating federal drug control laws, per a new legal settlement with the U.S. government.

The settlementlays out just a portion of what the government calls, at minimum, thousands of violations of the Controlled Substances Act over a period of years.

For one, UMHS failed to register 15 off-site facilities that received and dispensed controlled substances with the DEA. That “rendered unlawful all of the narcotics distributions from the main hospital to the unregistered off-site locations, as well as the unregistered locations’ subsequent dispensing of these narcotics to their patients,” according to the government.

And lax recordkeeping and procedures led to powerful drugs going missing on many occasions, with some documented instances of theft.

Between 2011 and 2012, 16,000 hydrocodone pills were stolen by one or more staff members. In other instances, nurses diverted powerful drugs, including fentanayl, for months or even years—in some cases, refilling the vials with saline before giving them to patients.

In some of these cases, UMHS failed to “notify the DEA in a timely manner regarding some instances of thefts or significant losses of controlled substances.”

The settlement does praise the health system for making major improvements since the government started investigating after two incidents December 2013. That’s when a nurse and a resident both overdosed on diverted fentanyl on hospital premises. The nurse died.

In addition to the fine, which the government calls the largest ever for a case of this kind, the settlement sets up a three-year agreement with the DEA for getting the health system in full compliance with Controlled Substances Act.

The memorandum of understanding sets out a series of steps to ensure that UMHS registers all facilities that prescribe and dispense controlled substances with the DEA; maintains complete and accurate records for all distribution and dispensing activities; and maintains effective controls against diversion at all facilities.

UMHS addressed the settlement in a written statement Thursday.

“’At Michigan Medicine, we take these issues very seriously and are always in the business of improving what we do,” spokeswoman Beata Mostafavi said via email. “We were not where we needed to be as a regulatory matter and, equally important, as measured against our own high standards.

“We’ve made multiple, substantial improvements to our pharmacy and controlled substance processes over the last several years and expect to continue those efforts in the future.”

Sarah Cwiek joined Michigan Public in October 2009. As our Detroit reporter, she is helping us expand our coverage of the economy, politics, and culture in and around the city of Detroit.
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