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Effingham Health System agrees to record-setting civil penalty

POSTED: May 16, 2018 3:51 p.m.
Mark Lastinger/staff/

Effingham Health System CEO Fran Baker-Witt addresses the media during Wednesday's news conference in the Kieffer Community Room.

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SPRINGFIELD — Effingham Health System is taking its medicine by agreeing to a record civil penalty related to alleged record keeping and notification violations of the Controlled Substances Act.
In the nation's largest settlement of its kind involving drug diversions at a hospital, Effingham Health System has agreed to pay the U.S. $4.1 million "to resolve allegations that it failed to provide effective controls and procedures to guard against theft and loss of controlled substances, leading to a significant diversion of opioids, and failing to timely report the suspected diversion to the Drug Enforcement Administration (DEA)."
The U.S. Attorneys Office announced the settlement in a Wednesday morning news release. The agency said Effingham Health System cooperated with the probe and was implementing changes to its pharmacy operations before it started in 2017.
The hospital responded quickly to the announcement with a news release of its own at a 2 p.m. news conference.
“We appreciate the cooperative nature of the United States Attorney’s Office and Drug Enforcement Agency, for recognizing the efforts put forth since 2016 to improve pharmacy operations," said Fran Baker-Witt, Effingham Health System CEO. “We were dismayed to find, through this investigation, vulnerabilities in our prior record keeping and reporting systems.”
Baker-Witt added, "This settlement is not an admission of liability, but in the spirit of cooperation, it has allowed us to avoid extensive legal expenses and costs related to an ongoing investigation. It assures that an ongoing investigation will not interrupt, or compromise, the care we provide our patients. "
The CEO said Effingham Health System was unaware of potential wrongdoing until the DEA notified it of the investigation. All the alleged violations occurred prior to her ascending to her position.
“We are experiencing a national opioid crisis and drug diversion is a challenge facing all healthcare systems, including some of the largest hospitals in our country,” she said. “We understand we have a critical responsibility to ensure that controlled substances are tracked and safeguarded, from theft or loss, and we take that responsibility seriously.”
The DEA launched an investigation after receiving reports of diversion at Effingham Health System. DEA determined that tens of thousands of oxycodone tablets were unaccounted for and were believed to have been diverted over more than a four-year period, in violation of the hospital’s responsibilities under the Controlled Substances Act.
“At a time when our country’s opioid crisis is ravaging communities across the country, hospitals like Effingham Health System have a critical responsibility to ensure that controlled substances are tracked and safeguarded from theft or loss and are not diverted for illegal uses,” said U.S. Attorney Bobby L. Christine. “Hospitals must adopt and maintain effective safeguards as a bulwark against diversion — the risk to the public is simply too great to accept anything less than what the law demands.”
Robert J. Murphy, the special agent in charge of the DEA Atlanta Field Division said, “Hospitals put lives at risk when they fail to maintain accurate record keeping of their inventory. Such careless behavior allows for substances to be diverted and sold on the black market with no true measure of accountability. This record-setting civil penalty is a proactive step that DEA Diversion and our partners in the U.S. Attorney’s Office can take to discourage other healthcare providers from engaging in such reckless behavior.”

Baker-Witt anyone suspected of wrongdoing in the wake of the probe has been terminated.

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