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This Company Paid the Price for Employing an Unlicensed Healthcare Worker. Could It Happen to You?

Healthcare organizations tend to grudgingly accept credentialing as an expensive obligation. And while it’s true that conventional credentialing methods can be costly, time-consuming, and inefficient, healthcare credentialing is more than just a box to check.

Just ask the pharmacy chain that recently settled a consumer protection lawsuit for $7.5 million after employing an unlicensed pharmacist.

The case is a cautionary tale for other healthcare organizations. The moral of the story? There are real consequences to having a credentialing process that lets unqualified employees slip through the cracks.

What Happened?

In 2018, the California Board of Pharmacy brought a complaint against a well-known pharmacy chain alleging that one of the chain’s employees had verified nearly 750,000 prescriptions — including more than 100,000 prescriptions for controlled substances — over the course of 10 years despite not having a valid pharmacist’s license.

According to the complaint, the employee had previously been licensed as a pharmacy technician in California, but that credential had expired in 2008. Since then, the employee had been using the pharmacist license number of another person with a name similar to hers. In fact, the employee in question had never been licensed as a pharmacist.

According to CNN, Alameda County, California’s district attorney, whose office prosecuted the case, said the company had failed to properly check the employee’s credentials after being promoted into positions requiring a license.

According to the terms of the settlement, the company was — among other things — required to pay $7.5 million in penalties, implement a verification process to check licenses, and conduct annual licensure audits. Why such a process wasn’t in place to begin with is unclear.

Understandably, when the news broke that a big-name pharmacy chain had employed a “fake pharmacist” for over a decade and that that person had prepared prescriptions for hundreds of thousands of customers, the public was outraged. Needless to say, the employer did not come off as responsible or trustworthy.

“As a cancer patient, this is terrifying,” one person posted on social media. Pharmacists were also incensed at the insult to their profession, with some laying the blame squarely on the pharmacy chain. “This does not surprise me. People lie. That is why we are supposed to have leadership in place to protect patients,” one pharmacist told Pharmacy Times.

Could Your Healthcare Organization Be Next?

We don’t know for sure why the pharmacy chain in this story failed to notice an imposter working on its team for more than 10 years. What we do know is that periodic credentialing is a best practice in the healthcare industry.

It is no longer sufficient to take a snapshot of a healthcare worker’s credentials at the time of hiring. A lot can happen to someone’s certification during the tenure of their employment.

For example, a physician’s state license can lapse due to oversight. Or a license can be revoked for disciplinary reasons, such as for malpractice or Medicare fraud.

Making things more complicated, the licensure requirements themselves can change. (For example, several states loosened their requirements during the COVID pandemic.)

Regardless of the cause, continuing to employ uncredentialed workers in a healthcare field can expose your organization to a significant amount of risk.

If discovered (and it’s worth noting the pharmacy case discussed in this article originated from an unrelated routine investigation), your organization could face stiff financial penalties, negative publicity, and a loss of funding from major payers such as Medicare/Medicaid.

Unfortunately, it can be extremely difficult and expensive to keep on top of credentialing for a large group of medical employees. Often, the best you can do is cycle through your roster every year or so — remaining unaware of any credential changes that occur in the meantime.

What if you could be notified the instant one of your employees’ certification status changed? That’s one of the benefits of automated healthcare credentialing, which uses cutting-edge software to provide continuous intelligent monitoring of hundreds of primary sources.


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