eClinicalWorks Settlement Raises Question Of Customer Liability

Posted on July 19, 2017 I Written By

Anne Zieger is veteran healthcare consultant and analyst with 20 years of industry experience. Zieger formerly served as editor-in-chief of FierceHealthcare.com and her commentaries have appeared in dozens of international business publications, including Forbes, Business Week and Information Week. She has also contributed content to hundreds of healthcare and health IT organizations, including several Fortune 500 companies. Contact her at @ziegerhealth on Twitter or visit her site at Zieger Healthcare.

Not much ago, my colleague John Lynn shared the news that EMR vendor eClinicalWorks had settled a whistleblower lawsuit for $155 million. The U.S. Department of Justice found that the vendor had skirted many EMR certification requirements, which in turn had caused providers using its software to file false claims for Meaningful Use incentives.

Today, I read an interesting follow-up by Becker’s Hospital Review addressing the issue of whether eCW users faced any liability for the vendor’s failure to meet certification standards.  The Becker’s writer, who reached out to CMS to find out its policy on the matter, found that while eCW’s customers technically submitted false claims for MU reimbursement, the agency won’t be asking any them to return any of the money.

If anyone has calculated how much CMS paid them, I haven’t seen the figures, but I’m sure it’s a pretty substantial sum of money. It’s good to see that the feds aren’t putting the squeeze on these customers, who presumably weren’t aware of eCW’s apparent skullduggery.

The thing is, I find it hard to believe that eCW is the only vendor who fudged things to get certified for the MU program. In fact, I’d guess that virtually every vendor in the industry has skirted if not crossed the line when it comes to EMR certification. That’s the way it goes, realistically, when you’re dealing with federal oversight.

After all, doesn’t every company work to save as much on taxes as they can? Yes, some are very conservative and only take whatever deductions they see as clearly legal, but others push harder. A goodly number of firms are willing to adopt strategies a tax lawyer might call “aggressive” – which don’t clearly violate the law but may raise a few eyebrows – in an effort to maximize their profits.

The big question here is whether an EMR customers could be on the hook for incentives paid wrongly due to an invalid vendor certification. If vendors are coloring outside the lines, it’s likely some will be caught, and if so, I’m betting that CMS will eventually get tough with their customers.

In the absence of clear evidence of customer wrongdoing, CMS might let customers keep their incentive payments. But I imagine that under some circumstances, the agency might wonder if they knew they what was going on and decided to take, say, a price cut in exchange for keeping its mouth shut.

Also, particularly if other vendors are hit with whistleblower suits, CMS might decide that customers should have validated that the EMR they were using actually had a legitimate certification. I don’t know how (or if) EMR customers would do this, but I can imagine a scenario under which CMS might take this tack.

Bottom line, we’d all better hope that CMS doesn’t decide to audit every vendor’s EMR certification filings. As I see it, their customers could easily be caught in the backlash.