A big Massachusetts developer of electronic medical records and some company executives will pay the federal government $155 million to settle a false claims lawsuit.
On Wednesday afternoon acting U.S. attorney for the district of Vermont Eugenia A.P. Cowles announced the settlement had been reached with eClinicalWorks LLC, a Westford, Mass., electronic medical records vendor with a customer base of more than 125,000 physicians and nurse practioners and annual revenue over $440 million.
The vendor will pay the money to resolve a lawsuit filed by the federal government alleging false claims of software performance and kickbacks to customers for false product promotions.
Under the settlement, eClinicalWorks and three of the company’s top executives—CEO Girish Navani, chief medical officer Dr. Rajesh Dharampuriya, and chief operating officer Mahesh Navani—are liable to pay the federal government $154.9 million. Other company employees including a developer and two project managers will pay fines of $50,000 and $15,000, respectively.
In its complaint, the government contends that eClinicalWorks falsely obtained certification for its electronic records software when it concealed that its software did not comply with certain requirements mandated by the U.S. Department of Health and Human Services.
“In order to pass certification testing without meeting the criteria for standardized drug codes, the company modified its software by coding only the drug codes required for testing,” the government says.
Rather than programming the capability to retrieve any drug code from a complete database, eClinicalWorks typed only the 16 codes necessary for certification directly into its software, according to the government lawsuit.
Specific false claims the government says eClinicalWorks instigated include:
- Falsely certified that its electronic health records software 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 $392,000 to influential customers to recommend eClinicalWorks products to prospective customers and other kickbacks in the form of “consulting” and “speaker” fees.
“Every day, millions of Americans rely on the accuracy of their electronic health records to record and transmit their vital health information,” says acting assistant attorney general for the civil division of the Department of Justice Chad A. Readler. “This resolution is a testament to our deep commitment to public health and our determination to hold accountable those whose conduct results in improper payments by the federal government.”
As part of the settlement eClinicalWorks does not admit any liability. But eClinicalWorks has entered into a five-year agreement with the Health and Human Services Office of Inspector General to assess the vendor’s software quality control and provide written semi-annual reports documenting various product reviews and recommendations.
“ECW must 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,” the government says. “ECW will 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.”
The settlement resolves a whistle blower lawsuit filed in 2015 by a former software technician for the New York Division of Healthcare Access, who received a payment of $30 million for reporting the company’s practices, the government says.
For its part, eClinicalWorks says the matter is now resolved. “Today’s settlement recognizes that we have addressed the issues raised and have taken significant measures to promote compliance and transparency,” Navani says. “We are pleased to put this matter behind us and concentrate all of our efforts on customers and continued innovations to enhance patient care delivery.”