Consumer Fraud

Whistleblower Helps U.S. Recover $155 Million

whistleblower 2 370x210 Whistleblower Helps U.S. Recover $155 MillionOne of the nation’s largest vendors of electronic health records software, eClinicalWorks, and certain of its employees will pay a total of $155 million to settle a whistleblower lawsuit alleging they misrepresented the capabilities of their software and paid kickbacks to customers in exchange for promotional favors.

The U.S. Department of Justice said that the Westborough, Massachusetts-based software firm “falsely obtained” government-required certification for its electronic health records software by concealing from its certifying agency the software’s noncompliance with federal certification requirements.

The American Recovery and Reinvestment Act of 2009 established the Electronic Health Records (EHR) Incentive Program to encourage healthcare providers to adopt EHR technology. Under the program, the U.S. Department of Health and Human Services (HHS) offers incentive payments to healthcare providers that implement certified EHR technology and meet certain requirements relating to their use of the technology.

According to federal prosecutors, one example of eClinicalWorks’ noncompliance with certification requirements was its programming the software to pass certification testing by recognizing only the 16 drug codes required for testing. The company did this, prosecutors said, despite knowing that the software needed to retrieve any drug code rom a complete database.

eClinicalWorks’ software also did not accurately record user actions in an audit log as required by the government. In certain situations, the software failed to record diagnostic imaging orders and perform drug interaction checks as required. Additionally, the EHR software failed to satisfy data transfer requirements intended to permit the exchange of data to and from software made by other companies.

The government alleged that these and other deficiencies caused healthcare providers using eClinicalWorks’ software to submit false claims for federal incentive payments based on their use of the EHR software.

Under the terms of the settlement agreements, eClinicalWorks and three of its founders, Chief Executive Officer Girish Navani, Chief Medical Officer Rajesh Dharampuriya, M.D., and Chief Operating Officer Mahesh Navani, are jointly liable for the payment of $154.92 million to the U.S. Separately, developer Jagan Vaithilingam will pay $50,000, and project managers Bryan Sequeira and Robert Lynes will each pay $15,000.

The settlement resolves allegations brought in a lawsuit filed in a Vermont federal court by Brendan Delaney, a software technician formerly employed by the New York City Division of Health Care Access and Improvement. Mr. Delaney filed the lawsuit under the whistleblower provisions of the False Claims Act. He will receive approximately $30 million of the total recovery as a whistleblower award.

Acting U.S. Attorney Eugenia A.P. Cowles for the District of Vermont said the settlement is “the largest False Claims Act recovery in the District of Vermont” and “the largest financial recovery in the history of the State of Vermont.”