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Following $155M FCA Settlement, EHR Provider Hit with Class Action Suit

Posted  January 4, 2018

By the C|C Whistleblower Lawyer Team

Last May, eClinicalWorks (ECW) resolved allegations that it misrepresented the capabilities of its software when the EHR has being tested for CMS certification. Healthcare providers that use CMS-certified EHR software qualify for incentive payments from the agency. Instead of developing software that met the relevant requirements, ECW allegedly designed software to pass the certification requirements without actually meeting the certification criteria. For example, the company only programed the software to work for the 16 drug prescription codes that they knew would be on the certification test. Additionally, ECW was accused of paying kickbacks to users in exchange for the users attesting that the software met the certifying criteria. Three executives of the company were also held jointly and severally liable for the settlement amount.

In addition to the payment, ECW entered into a Corporate Integrity Agreement that requires the company to retain a software auditor and provide semiannual written reports to the HHS Office of the Inspector General. The CIA also required ECW to report the problems with its software to its customers, and allow its customers to obtain software updates free of charge.

That case was brought by a whistleblower who received a $30M reward.

As a result of the conduct leading to that settlement, ECW’s customers are now suing it. Carrollton Family Clinic, a healthcare provider in Mississippi, is trying to certify a class of plaintiffs who relied on ECW’s statements that its software satisfied the criteria that qualified it for incentive payments. Carrollton also alleges that ECW engaged in deceptive trade practices, causing the provider to pay inflated prices for ECW software, thinking it qualified for incentive payments, instead of buying software from a cheaper, unqualified competitor. Carrollton has already had to forfeit $18K in incentive payments to Mississippi’s Medicaid program. The case was filed in the District of Massachusetts.

Tagged in: Contract Non-Compliance, Electronic Health Records, Government Procurement Fraud,