In January 2021 federal prosecutors in the Eastern and Western Districts of Michigan announced that McLaren Health Care Corporation had agreed to pay $7.75 million to resolve allegations that it violated the Controlled Substances Act. The U.S. Attorney for the Eastern District described it as the largest civil Controlled Substances Act settlement in American history involving a health care system whose internal practices allowed the diversion of drugs, including opioids.
According to the reports, the DEA investigation began after learning that an unregistered substance abuse treatment facility in Boyne Falls was receiving prescription drugs from a subsidiary pharmacy in Western Michigan by calling in prescriptions for office stock. The investigation expanded to hospitals and facilities across the state. In 2018 DEA identified prescribing irregularities at the Port Huron retail pharmacy, which led the corporation to terminate a pharmacist who was diverting opioids for personal use. The drugs alleged to have been illegally distributed included hydrocodone, oxycodone and hydromorphone.
Prosecutors alleged that two pharmacies dispensed Schedule II drugs without written prescriptions and ignored red flags such as repeated identical prescriptions from the same prescriber, excessive quantities, early refills, entries for fake patients and cash discrepancies. They further alleged that the corporation failed to notify DEA of known employee thefts of controlled substances and that its corporate controlled-substance policies were deficient.
Under the settlement the corporation committed to implementing more robust compliance measures. A company compliance official stated that the health system cooperated with the government from the outset and maintains a controlled substance oversight committee. The settlement resolves allegations only and is not a finding of liability.