False Claims Act Lawsuits Are Ready to “Go Viral” in the Health IT Industry

AHLA Health Care Liability & Litigation November 2017

Melissa L. Jampol and Richard W. Westling, Members of the Firm, and Yulian Shtern, an Associate, in the Health Care and Life Sciences and Litigation practices, in the firm’s New York, Nashville, and Newark offices, authored an article in American Health Lawyers Association (AHLA) Health Care Liability & Litigation, titled “False Claims Act Lawsuits Are Ready to 'Go Viral' in the Health IT Industry.”

Following is an excerpt (see below to download the full version in PDF format):

On May 31, 2017, in a first of its kind settlement, eClinical Works (ECW), one of the nation’s largest electronic health records (EHR) vendors, agreed to pay $155 million to settle a False Claims Act (FCA) lawsuit, filed by a qui tam relator, after the Department of Justice (DOJ) intervened. The settlement resolved allegations that ECW falsely certified the capabilities of its EHR software and paid kickbacks to customers in exchange for promoting its product. ECW also agreed to a unique corporate integrity agreement (CIA), tailored specifically for EHR vendors, which, among other things, requires it to hire an independent software quality oversight organization.

While health information technology (IT) vendors generally have stayed out of the spotlight in FCA litigation, the nature and amount of the ECW settlement is sure to increase the risk that other vendors will face FCA actions. Indeed, the complaint, settlement agreement, and CIA provide a roadmap for future actions against other health IT vendors.

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