Electronic Health Records Vendor To Pay $154.92 Million For FCA Violations

Posted On Monday, June 5, 2017

eClinicalWorks, one of the largest electronic health record vendors in the United States, settled FCA violations related to its software, the DOJ announced on May 31.  The FCA suit was a qui tam action filed by a whistleblower in the District of Vermont, alleging that eClinicalWorks misrepresented the capability of its software used to maintain electronic health records (“EHR”).  The company received federal funds provided to EHR vendors like eClinicalWorks to adopt certified technology necessary to the accuracy and security of personal health data.  To receive federal funds, however, an EHR vendor must truthfully certify that its software met these requirements which are established by HHS and verified by an independent certifying agency.

The United States joined the qui tam case through its complaint-in-intervention, alleging that eClinicalWorks concealed from the certifying agency the non-compliant nature of its software and, as a result, falsely obtained its certification.  The government claimed that, for example, the software did not accurately record user actions through its audit function and did not satisfy the data portability requirement to allow the transfer of patient health information from one EHR vendor to another. 

Under the settlement, eClinicalWorks and three of its founders – the CEO, the COO, and the Chief Medical Officer – accepted joint and several liability for the payment of $154.92 million.  Three other employees, one a software developer and the two others, project managers, will each pay $50,000 and $15,000, respectively.  The settlement also includes a corporate integrity agreement with the HHS Office of Inspector General requiring eClinicalWorks to take remedial measures and subject itself to monitoring of its software quality control systems by an oversight agency.  The whistleblower, a software technician, will receive approximately $30 million under the False Claims Act.

The DOJ press release, the United States’ complaint-in-intervention, and the Corporate Integrity Agreement can be found herehere, and here, respectively.