Westborough, MA-based eClinicalWorks has agreed to pay a $155 million to the federal government for civil fraud and kickback charges. Both the government and the whistleblower alleged that eClinicalWorks falsely represented to customers that its EHR system complied with Meaningful Use requirements. The settlement marks the first time an EHR vendor is being charged for the truthfulness and accuracy of representations made when seeking government certification of its EHR system and the government applying the federal Anti-Kickback Statute (AKS) law to the promotion and sale of EHR systems. Despite the settlement agreement, eClinicalWorks has denied all allegations.
The American Recovery and Reinvestment Act of 2009 established the Electronic Health Records (EHR) Incentive Program to encourage healthcare providers to adopt and demonstrate their “meaningful use” of EHR technology. Under the program, the U.S. Department of Health and Human Services (HHS) offers incentive payments to healthcare providers that adopt certified EHR technology and meet certain requirements relating to their use of the technology. To obtain certification for their product, companies that develop and market EHR software must attest that their product satisfies applicable HHS-adopted criteria and pass testing by an accredited independent certifying entity approved by HHS.
Whistleblower Lawsuit Overview
The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The initial whistleblower lawsuit was filed in 2015 when Brendan Delaney, a City of New York software technician implementing the eClinicalWorks EHR system at Rikers Island prison realized the EHR system allegedly put patients at risk.
Under the lawsuit, Mr. Delaney alleged that eClinicalWorks:
– Falsely certified that its EHR met all government criteria
– Failed to adequately test software before it was released
– Failed to correct critical and urgent problems and bugs in the software “for months and even years.”
– Failed to ensure data portability and audit log requirements
– Failed to reliably record laboratory and diagnostic imaging orders
– Paid kickbacks totaling at least $392k to influential customers to recommend eClinicalWorks products to prospective customers and other kickbacks in the form of “consulting” and “speaker” fees
For example, in order for eClinicalWorks to falsely meet the Meaningful Use requirements, the company allegedly modified its software by “hardcoding” only the drug codes required for testing. Instead of properly programming the functionality to retrieve any drug code from a complete database, eCW simply typed the 16 codes necessary for certification testing directly into its software.
Settlement Agreement Details
Under terms of the settlement, eClinicalWorks and its founders and executives Girish Navani, Dr. Rajesh Dharampuriya, and Mahesh Navani are liable for payment of $154.92 million. Additionally, Developer Jagan Vaithilingam will pay $50,000, and Project Managers Bryan Sequeira, and Robert Lynes will each pay $15,000. Mr. Delaney will receive approximately $30 million.
As part of the settlement, eCW entered into a Corporate Integrity Agreement (CIA) with the HHS Office of Inspector General (HHS-OIG) covering the company’s EHR software.
The agreement requires that eClinicalWorks:
– retain an Independent Software Quality Oversight Organization to assess eClinicalWork’s software quality control systems and provide written semi-annual reports to OIG and eCW documenting its reviews and recommendations.
– provide prompt notice to its customers of any safety related issues and maintain on its customer portal a comprehensive list of such issues and any steps users should take to mitigate potential patient safety risks.
– requires eClinicalWorks to allow customers to obtain updated versions of their software free of charge and to give customers the option to have eCW transfer their data to another EHR software provider without penalties or service charges
– retain an Independent Review Organization to review the company’s arrangements with healthcare providers to ensure compliance with the Anti-Kickback Statute.
“This settlement is the largest False Claims Act recovery in the District of Vermont and we believe the largest financial recovery in the history of the State of Vermont,” said Acting U.S. Attorney Eugenia A.P. Cowles for the District of Vermont in a statement. “This significant recovery is a testament to the hard work and dedication of this office and our partners in the Commercial Litigation Branch of the Civil Division and at HHS. This resolution demonstrates that EHR companies will not succeed in flouting the certification requirements.”
Implications for Current eClinicalWorks Customers
eCW must provide notice to its customers of any safety related issues and maintain on its customer portal a comprehensive list of such issues and any steps users should take to mitigate potential patient safety risks. The settlement requires eCW customers to receive updated versions of their EHR software free of charge and provides an option to have ECW transfer their data to another EHR software provider without penalties or service charges.
It is important to note that the claims resolved by the settlement are allegations only, and there has been no determination of liability.
