When an announcement came over the loudspeaker that armed intruders had entered a children's psychiatric hospital in Michigan, staff and patients flew into a panic. 

Workers rushed to get children to safety, loading them up with soaps and shampoo bottles to throw at the shooters if necessary. People frantically texted their loved ones what they thought could be their final messages. Armed police officers burst onto the scene.

But it turns out there were no gunmen at the state-run Hawthorn Center in Northville, Mich. It was all a drill. 

"People literally thought they were going to die," David Horein, whose son Dylan was a patient at Hawthorn at the time, told As It Happens host Nil Köksal. 

"I feel that this incident was a shining example of gross negligence on the behalf of the hospital."

The Michigan Department of Health and Human Services will now pay out $13 million US ($18 million Cdn) to the impacted workers and children as part of a class action settlement. The hospital has since shut down to make way for a new facility.

Lynn Sutfin, a spokesperson for the department, said they "felt it was in the best interest of all involved parties to settle this matter."

"We regret that our patients, staff and community were negatively affected by the unfortunate incident," she said in a written statement. 

"We commend our staff who worked quickly to engage law enforcement partners and the responding agencies who worked to resolve the situation."

Police didn't know about the drill, either

The unannounced drill went down on Dec. 21, 2022, at the facility north of Detroit.

According to the lawsuit, someone working at the front desk announced over the speakers that two men with guns were on the property, and shots had been fired.

"Everyone went into, 'Oh my God. This is the worst day of my life,'" Robin Wagner, attorney for the plaintiffs said. "People were hiding under their desks. They were barricading the doors, trying to figure out how to protect the children."

Police were not in on the ruse, so when workers called 911, dozens of Northville Township officers showed up with bulletproof vests and high-powered weapons. 

"You get an immediate adrenaline dump. Your stomach gets that queasy feeling. Your heart starts racing," Deputy Police Chief Matthew McKenzie told the Washington Post.

When the officers arrived, they found two unarmed men, who told them they were asked to pose as shooters for a drill. 

Father didn't know until he saw it on the news

Horein says he first learned there had been an active shooter drill when he visited his son for Christmas a few days later, but nobody told him it was unannounced. His son, who is autistic, didn't say much about it.

He didn't learn the true extent of what happened until several months later, when it made the local news.

"I was very angry," he said. 

He asked Dylan, who is now 12, about it again.

"He told me that he was terrified. He didn't like talking about it," Horein said.

"One of the staff members looked at him and said, 'Hey, I know you know how to fight. We're going to try to protect you. But if we go down, you're going to have to fight for your life. My son, who was 11 at the time, should not have had to bear that burden."

The family has since moved to Wisconsin to seek better treatment for their son, who Horein says is still feeling the impacts of the drill.

With the rise of mass shootings, especially in the U.S., active shooter shooting drills have become increasingly common in recent years, including in schools, though they remain controversial. 

Horein says he's been involved in active shooter drills himself when he served in the military.

"But we were always informed that it was a drill … so we could build muscle memory so that if the emergency ever happened in real life, we could respond with calm efficiency," he said. 

"By doing this drill unannounced, all they did was create panic. There was no training value at all."

$83K for impacted children

Judge James Redford approved the settlement on Oct. 4. Fifty children at the hospital each will receive roughly $60,000 US ($83,000 Cdn). 

Among staff, 90 people will receive, on average, a little more than $50,000 ($69,000), depending on their score on a trauma exam, Wagner said. Two dozen others will get smaller amounts, and more than $3 million ($4.1 million) will go to attorneys.

Wagner said the drill was organized by the Hawthorn Center's safety director, who still works for the state. That doesn't sit well with Horein. 

"From the very beginning, I have been calling for the termination of those decision makers who were involved in this, and that has not happened," Horein said. 

"There has never been a legitimate apology for the incident that took place, never a sincere acknowledgement of wrongdoing."