https://www.justice.gov/opa/pr/electronic-health-records-vendor-pay-145-million-resolve-criminal-and-civil-investigations-0
Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Monday, January 27, 2020
Electronic Health Records Vendor to Pay $145 Million to Resolve Criminal and Civil Investigations
Practice Fusion Inc. Admits to Kickback Scheme Aimed at Increasing Opioid Prescriptions
Practice Fusion Inc. (Practice Fusion), a San Francisco-based health information technology developer, will pay $145 million to resolve criminal and civil investigations relating to its electronic health records (EHR) software, the Department of Justice announced today.
As part of the criminal resolution, Practice Fusion admits that it solicited and received kickbacks from a major opioid company in exchange for utilizing its EHR software to influence physician prescribing of opioid pain medications. Practice Fusion has executed a deferred prosecution agreement and agreed to pay over $26 million in criminal fines and forfeiture. In separate civil settlements, Practice Fusion has agreed to pay a total of approximately $118.6 million to the federal government and states to resolve allegations that it accepted kickbacks from the opioid company and other pharmaceutical companies and also caused its users to submit false claims for federal incentive payments by misrepresenting the capabilities of its EHR software.
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The resolution announced today addresses allegations that Practice Fusion extracted unlawful kickbacks from pharmaceutical companies in exchange for implementing clinical decision support (CDS) alerts in its EHR software designed to increase prescriptions for their drug products. Specifically, in exchange for “sponsorship” payments from pharmaceutical companies, Practice Fusion allowed the companies to influence the development and implementation of the CDS alerts in ways aimed at increasing sales of the companies’ products. Practice Fusion allegedly permitted pharmaceutical companies to participate in designing the CDS alert, including selecting the guidelines used to develop the alerts, setting the criteria that would determine when a healthcare provider received an alert, and in some cases, even drafting the language used in the alert itself. The CDS alerts that Practice Fusion agreed to implement did not always reflect accepted medical standards. In discussions with pharmaceutical companies, Practice Fusion touted the anticipated financial benefit to the pharmaceutical companies from increased sales of pharmaceutical products that would result from the CDS alerts. Between 2014 and 2019, health care providers using Practice Fusion’s EHR software wrote numerous prescriptions after receiving CDS alerts that pharmaceutical companies participated in designing.
Practice Fusion executed a deferred prosecution agreement with the U.S. Attorney’s Office for the District of Vermont based on its solicitation and receipt of kickbacks from a major opioid company to arrange for an increase in prescriptions of extended release opioids by healthcare providers who used Practice Fusion’s EHR software. As detailed in the criminal Information made public today, Practice Fusion solicited a payment of nearly $1 million from the opioid company to create a CDS alert that would cause doctors to prescribe more extended release opioids. That payment was financed by the opioid company’s marketing department, and the CDS was designed with input from the marketing department. Practice Fusion and the opioid company entered the CDS sponsorship because they believed that the CDS would influence doctors’ prescriptions of extended release opioids. In marketing the “pain” CDS alert, Practice Fusion touted that it would result in a favorable return on investment for the opioid company based on doctors prescribing more opioids.
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The civil settlement with the United States resolves Practice Fusion’s civil liability arising from the submission of false claims to federal healthcare programs tainted by the kickback arrangement between Practice Fusion and the opioid company. It also resolves allegations of kickbacks relating to thirteen other CDS arrangements where Practice Fusion agreed with pharmaceutical companies to implement CDS alerts intended to increase sales of their products. The $118.6 million settlement amount includes approximately $113.4 million to the federal government and up to $5.2 million to states that opt to participate in separate state agreements.
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