$145 Settlement Proposed by Allscripts to Resolve HIPAA and Anti-Kickback Case

Allscripts Healthcare Solutions has proposed a settlement of $145 million to resolve alleged violations of the Health Insurance Portability and Accountability Act (HIPAA), the Health Information Technology for Economic and Clinical Health (HITECH) Act, and the Anti-Kickback statute. The alleged violations were in relation to the EHR company Practice Fusion, which was acquired by Allscripts for $100 million in Q1, 2018.

Prior to the acquisition, Practice Fusion had been investigated by the Attorney’s Office for the District of Vermont, and further requests for information were received between April 2018 and January 2019.

The Department of Justice (DOJ) issued a grand jury subpoena in March 2019 in response to the alleged business practices of Practice Fusion, potential violations of the Anti-Kickback Statute, and HIPAA violations. Practice Fusion was also alleged to have violated the HITECH Act and to have fraudulently claimed financial incentives under the HHS EHR incentive program.

If approved, the settlement will resolve all cases against Allscripts and Practice Fusion and will absolve both companies of civil and criminal liability related to the investigation.

Allscripts President Rick Poulton said the settlement was not insignificant and was in line with other settlements agreed with the DOJ in similar cases. Poulton said the financial settlement with the DOJ had been agreed in principle, but the nonfinancial terms and conditions of the settlement are subject to negotiation. The details of the settlement are not likely to be worked out for several weeks or months.

The Allscripts case is the latest DOJ action against a healthcare organization that allegedly falsely claimed they had met the requirements of the EHR incentive program (Meaningful Use) in order to receive incentive payments. In 2018, the EHR vendor eClinicalWorks settled its case with the DOJ for $155 million over similar false claims.