A federal judge last week tossed a lawsuit alleging that Community Health Systems had made false claims about its electronic health record software.
Two whistleblowers in 2018 had sued Community Health Systems and its EHR vendor Medhost in the U.S. District Court for the Southern District of Florida, accusing the Franklin, Tenn.-based system of submitting hundreds of millions of dollars in false claims to HHS for federal incentive payments for meaningfully using EHR software.
The lawsuit claimed CHS and Medhost had knowingly and falsely attested that the EHR software, developed by Medhost, complied with certification requirements. It alleged CHS made it a priority for its hospitals to submit attestations for incentive payments because they were an important source of revenue for the for-profit system.
U.S. District Judge Robert N. Scola, Jr., dismissed the complaint with prejudice June 11.
While the lawsuit alleged that Medhost had multiple software functionalities that did not work and weren't compliant with federal regulations, Scola said the lawsuit failed to show that Medhost had made misrepresentations about its software. It also failed to show that the company had knowledge of misrepresentations made to the government.
Scola likewise said the lawsuit failed to name any specific CHS hospital or management company employees who had made false submissions to the government or who had hidden concerns about alleged software defects.
"While the relators have indeed poured forth heaps of alleged facts, interwoven with conclusory allegations of wrongdoing, the resulting complaint is nonetheless fatally flawed," Scola wrote in the 38-page decision.
The 2018 lawsuit had claimed the EHR software implemented at CHS hospitals contained flaws that prevented clinicians from providing care safely and reliably, which should have made the software ineligible for certification under federal EHR incentive programs. For example, it said EHR problems led doctors to inadvertently order incorrect medications or dosages.
"Even though the flaws and lack of reliability with both the Medhost software and CHS' implementation of the software should have made the CHS hospitals ineligible for Meaningful Use incentive payments, CHS and CHS hospitals knowingly misrepresented to the government that the hospitals were eligible for subsidy payments," the complaint read.
The two whistleblowers, who worked for CHS as recently as December 2016, alleged the health system received more than $450 million in EHR incentive payments between 2012 and 2015.
HHS makes Medicare and Medicaid incentive payments to hospitals and physicians that demonstrate meaningful use of certified EHR technology through the Promoting Interoperability Program, formerly known as meaningful use. To qualify for incentive payments, hospitals and clinicians attest that they used certified technology and satisfied certain program objectives.
CHS and Medhost did not immediately respond to a request for comment.
In a statement on its website, Medhost said: "Thank you to the Medhost customers and partners who showed continued support to the company and its mission during the defense of this case."
Last year, Practice Fusion—an EHR developer owned by Allscripts Healthcare Solutions—agreed to pay $118.6 million to resolve allegations it accepted kickbacks and had caused its users to submit false claims for federal EHR incentive payments. It also agreed to pay more than $26 million in criminal fines and forfeiture.
In 2017, another EHR vendor, eClinicalWorks, and some of its employees were ordered to pay $155 million for allegedly falsely obtaining certification for its EHR software.