Your day-to-day focus as a veterinarian or practice manager is to provide patients with the best possible medical care and ensure that the hospital runs efficiently and effectively. You wear many hats and adhere to a plethora of state and federal regulations. All of this can be a challenge for anyone. Unfortunately, compliance with U.S. Drug Enforcement Administration regulations is one area where many veterinary practices fail to implement a cohesive and comprehensive program. One of the most commonly reported reasons is the cost. We often hear “It’s too expensive” or “I can’t afford it right now.”
DEA compliance, just like with veterinary care, is most effective when applied proactively. While compliance is not cheap, it’s an investment that pays dividends. Failing to prioritize it can put you and your practice at risk.
The financial impact of a DEA violation begins with mandated federal and, in some cases, state fines. On the federal level, up to $15,040 is the cost of each violation. In over three years of assisting veterinary practices nationwide, we have identified from five to 27 potential violations at each location. When we are engaged to assist veterinarians after federal charges have been filed, we never see fewer than 11 violations.
Other expenses often are incurred when DEA violations are alleged. They include:
1. Attorney Fees
When the DEA comes knocking, one of the first calls you make is to an attorney. Plan on spending anywhere from $150 to $700 an hour on legal fees. Under an hourly fee structure, the bill can quickly climb into the $10,000 to $15,000 range. A lawyer who bills an hourly rate might require a retainer.
2. Remediation Costs
Typically, a third-party expert who specializes in DEA compliance is needed to correct problems and work with the agency to reduce potential fines. The expense can easily total in the tens of thousands of dollars.
3. Crisis Management
When your reputation is on the line, you need a public relations firm to help keep you out of the headlines or tell your side of the story. Fees vary, but plan on $2,000 to $10,000 a month.
4. The Loss of Patients
Even the best crisis-management efforts rarely succeed in keeping felony allegations under wraps. When word gets out that you are the subject of a DEA investigation, your clients might choose another clinic.
5. The Loss of Employees
Team members might want out, too. According to PeopleKeep.com, the cost of replacing a salaried employee averages six to nine months’ worth of salary. With a practice manager making $60,000 a year, that’s $30,000 to $45,000 in recruiting and training expenses.
6. Compliance Oversight
You might have to enroll in a monitoring program. Several clients we worked with paid for three years of oversight.
7. Rehabilitation Program
If you are found guilty of failing to prevent drug diversion by an employee, you might be responsible, to some degree, for the cost of the employee’s drug rehabilitation program. We have worked with clients who had to pay as much as $20,000 a month.
8. State Investigation
Veterinarians are subject to oversight by state veterinary medical boards as well as state boards of pharmacy, which can assess additional fines.
9. Loss of Your DEA License
Getting back a DEA license isn’t easy. If you’re lucky, it might be an 18- to 24-month process. If the license return is denied, you incur the cost of sourcing and employing a new DEA registrant.
10. Lost Inventory
In cases of drug diversion, you might be cut off from your controlled-substances supplier.
When you add everything up, the cost of noncompliance can easily exceed $100,000. Proactively investing in compliance pays dividends and provides the peace of mind of knowing that the controlled substances you are entrusted with are protected.