Mt. San Rafael Hospital and three of its physicians have agreed to pay $650,000 to settle allegations that they unlawfully prescribed opioids and other controlled substances in violation of federal law. The settlement was announced by the United States Attorney’s Office for the District of Colorado.
The hospital, located in Trinidad, Colorado, and doctors Sheryll Castro-Flores, Joseph Jimenez, and Douglas McFarland were accused of violating both the Controlled Substances Act and the False Claims Act between January 2016 and December 2023. According to federal authorities, the doctors issued prescriptions for opioids and other drugs without a legitimate medical purpose or outside standard professional practice.
Federal officials allege that the physicians ignored warning signs such as high opioid doses, risky drug combinations, evidence of substance abuse among patients, long-term opioid use without proper oversight, cash payments despite insurance coverage, patients traveling long distances for prescriptions, and frequent requests for early refills.
The government claims that Mt. San Rafael Hospital is also responsible because it employed these doctors. The hospital allegedly contributed to improper claims submitted to Medicare and other federal health programs by allowing invalid prescriptions.
To resolve these allegations:
– Dr. Castro-Flores will pay $112,500.
– Dr. Jimenez will pay $112,500.
– Dr. McFarland will pay $100,000.
– Mt. San Rafael Hospital will pay $325,000.
In addition to the financial settlement, Mt. San Rafael Hospital has adopted new policies prohibiting opioid prescriptions for chronic pain management and implemented protocols intended to ensure safer prescribing practices aligned with state guidelines.
“Doctors and the hospitals who employ them must prescribe controlled substances carefully to protect patients and the community from the dangers of overprescribing,” said United States Attorney Peter McNeilly. “When doctors write prescriptions for opioids despite red flags signaling that the prescriptions may be invalid, they place the patient at risk of harm and they increase the likelihood of illegal diversion. And, when doctors cause illegitimate prescriptions to be submitted to Medicare and other federal healthcare plans, taxpayers pay for those illegitimate prescriptions. We will continue to hold doctors and hospitals accountable when they disregard these important obligations.”
“DEA will continue to relentlessly pursue hospitals and practitioners who engage in egregious prescribing practices jeopardizing the health and safety of patients and the community,” said DEA Rocky Mountain Field Division Diversion Program Manager George Taylor. “DEA, alongside federal and state partners, will not tolerate those that violate the trust of patients and will hold those parties accountable.”
“Physicians who recklessly, illegitimately distribute controlled substances undermine ongoing public health efforts to address the opioid crisis and betray their professional responsibility to serve the health and well-being of the public,” said Special Agent in Charge Linda T. Hanley of Health and Human Services Office of Inspector General (HHS-OIG). “Working closely with our law enforcement partners, HHS-OIG will continue to investigate such allegations to safeguard our health care system’s integrity as well as patient safety.”
None of those involved admitted liability as part of this settlement agreement.
The investigation was conducted by agents from both DEA’s Rocky Mountain Division as well as Health & Human Services’ Office of Inspector General; Assistant United States Attorney Jacob Licht represented the government.
