Hospital records settlement reached

The owners of a Cherokee Village hospital accused of leaving reams of confidential patient records unsecured when the hospital closed in 2004 agreed to pay more than $40,000 to cover costs associated with the removal and storage of patient and employee files, Attorney General Leslie Rutledge announced Friday.

The settlement came in a suit Rutledge filed in Pike County Circuit Court in March accusing Country Medical Services of Arkansas, the parent company of Eastern Ozarks Hospital, and its owners of violating the Patient Information Protection Act and the Arkansas Deceptive Trade Practices Act.

The 40-bed hospital came under scrutiny in 2004 over reports of problems with pharmacy staffing, outdated medications and an inability to provide emergency services because of a lack of testing supplies.

In December of that year, the state Department of Health suspended the hospital’s license and ordered the facility to close.

When Country Medical Services abandoned the hospital, it also left behind roughly 146,000 unsecured employee and patient files, including copies of Social Security cards, driver’s licenses and medical test results, Rutledge said. Years later, investigators at the scene found the records rummaged through, she said.

In April, the attorney general’s office arranged with the Health Department to have the surviving files removed from the property.

The settlement announced Friday allows for the lawful destruction of the files and prevents Country Medical Services from owning or operating a business in Arkansas in the future, Rutledge said.

A civil penalty of $730,000 will be suspended as long as the terms of the judgment are followed.

The company must repay more than $40,000 for the costs incurred by the removal and storage of the patient and employee files.