On Monday, January 27, 2020, Practice Fusion, Inc. admitted to participating in a kickback scheme aimed at increasing opioid prescriptions. For its involvement, the company has agreed to pay $145 million to resolve criminal and civil investigations relating to its electronic health records (EHR) software, as well as take additional steps in a deferred prosecution agreement. While the company did admit to some of the allegations in the deferred prosecution agreement, the Settlement Agreement between the company and the Department of Justice (DOJ) is not an admission of liability by Practice Fusion (or Allscripts Healthcare Solutions, whose subsidiary Allscripts Healthcare, LLC, purchased Practice Fusion in early 2018).
The agreement can be broken down as $26 million in criminal fines and forfeiture and $118.6 million to the federal government and states to resolve civil allegations that it took kickbacks from the opioid company (and other pharmaceutical companies) and that it also caused its users to submit false claims for federal incentive payments by misrepresenting the capabilities of its EHR software.
The resolution covers allegations that Practice Fusion received unlawful kickbacks from pharmaceutical companies in exchange for implementing clinical decision support (CDS) alerts in its EHR software. These CDS alerts were allegedly designed to increase prescriptions for the pharmaceutical companies’ products. Specifically, in exchange for “sponsorship” payments from pharmaceutical companies, Practice Fusion allowed the companies to influence both the development and the implementation of the CDS alerts 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. These CDS alerts that Practice Fusion agreed to implement did not always reflect accepted medical standards.
When engaged in discussions with pharmaceutical companies, Practice Fusion touted the anticipated financial benefit to the pharmaceutical companies from increased sales 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.
Criminal Resolution
As detailed in the criminal Information that was made public at the same time as the resolution announcement, Practice Fusion solicited a payment of almost $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.
The Information charges Practice Fusion with two felony counts for violating the Anti-Kickback Statute (AKS) and conspiring with its opioid company client to violate the AKS. This case is the first ever criminal action against an EHR vendor and the Deferred Prosecution Agreement imposes strict requirements on Practice Fusion to ensure transparency as to its underlying conduct and to invest heavily in compliance and an independent oversight organization.
For monetary penalties, the Deferred Prosecution Agreement requires Practice Fusion to pay a criminal fine of $25,398,300 and forfeit criminal proceeds of $959,700. The company has also agreed to cooperate in any ongoing investigations of the kickback arrangement and report any evidence of kickback violations by any other EHR vendors. The Deferred Prosecution Agreement requires Practice Fusion to make documents relating to its unlawful conduct available to the public through a web site and mandates that Practice Fusion retain an independent oversight organization that is required to review and approve any sponsored CDS before Practice Fusion may implement it, and create a comprehensive compliance program designed to ensure such abuses are not repeated.
As part of the criminal resolution, the company did admit that it solicited and received kickbacks from a major opioid company in exchange for using its EHR software to influence physician’s prescribing of opioid pain medications.
Commentary
Christina E. Nolan, United States Attorney for the District of Vermont did not mince words when it came to announcing the settlement. “Practice Fusion’s conduct is abhorrent. During the height of the opioid crisis, the company took a million-dollar kickback to allow an opioid company to inject itself in the sacred doctor-patient relationship so that it could peddle even more of its highly addictive and dangerous opioids,” said Nolan. “The companies illegally conspired to allow the drug company to have its thumb on the scale at precisely the moment a doctor was making incredibly intimate, personal, and important decisions about a patient’s medical care, including the need for pain medication and prescription amounts. This recovery is commensurate to the nature of Practice Fusion’s misconduct, represents the largest criminal fine in the history of this District, and requires Practice Fusion to admit to its wrongs. It is another example of pioneering healthcare fraud enforcement by the talented Assistant U.S. Attorneys and staff of this U.S. Attorney’s Office, working with their partners in law enforcement. We cannot—and will not—tolerate technology companies influencing patient treatment merely because a pharmaceutical company provided a kickback.”