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Details of Practice Fusion’s $145 Million DOJ Settlement Include Opioid Prescribing Kickbacks

January 27, 2020 News 3 Comments


The Department of Justice today announced details about the previously announced $145 million settlement by Allscripts-owned Practice Fusion. Practice Fusion admits in the settlement that it:

  • Solicited and received a million-dollar kickback from an opioid manufacturer in return for allowing the drug company’s marketing department to design EHR clinical decision support alerts that encouraged opioid prescribing outside of accepted medical standards.
  • Solicited 13 other agreements in which drug companies paid the company to influence CDS alerts to increase their prescription drug sales.
  • Obtained ONC EHR certification fraudulently by falsely claiming to the certification body that its software met 2014 Edition portability requirements, after which it disabled the feature and advised users to contact the company if they needed patient data exported.
  • Allowed providers to falsely claim Medicare and Medicaid EHR incentive payments when its product did not incorporate standardized vocabularies as HHS requires.

A Deferred Prosecution Agreement requires Practice Fusion to make compliance changes, obtain independent oversight, report any evidence of kickback violations by other EHR vendors, and to make details of the company’s unlawful conduct available to the public on a website. The oversight organization must also approve any sponsored CDS rules before they are implemented.

The Northern California US Attorney said in the announcement, “Prescription decisions should be based on accurate data regarding a patient’s medical needs, untainted by corrupt schemes and illegal kickbacks. In deciding what is best for patients, electronic health records software is an important tool for care providers. It is critically important that technology companies do not cheat when certifying that software.”

The $145 million settlement amount was announced by Allscripts as a tentative agreement in August, but specific details were not provided. Allscripts said in its Q2 earnings call that the $145 million settlement was in line with what other EHR vendors have paid to settle DOJ charges, but also added that “we expect to have recoveries from a variety of third parties that will help offset a portion of the amounts we have agreed to pay the government.”

Allscripts acquired Practice Fusion in January 2018 for $100 million after withdrawing a previous offer of $250 million. Practice Fusion had been previously valued at up to $1.5 billion.

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Currently there are "3 comments" on this Article:

  1. The advertising business model does not work in healthcare. Most developed countries have some sort of ban on medical advertising. The PF story is one reason why.

    Most consumer software is driven by an advertising business model. Facebook, google search, android, Gmail, MyFitnessPal, recipe apps, etc. HHS is opening up medical data to these advertising companies.

  2. Why go through all that effort to sell vaporware when you can sell pharma something they badly want?

    “As the acknowledged data source, we plan to develop a monetizable distribution model that provides access to legacy client segments and adjacent market prospects such as biopharma, payers and actuaries, to name a few.”
    Brent Shafer, Cerner CEO

    “Our global market share, our clinical research practice and our overall platform leverage provide natural points of differentiation in a segment with a significant $60-plus billion addressable market.”
    Donald Trigg, Cerner EVP of Strategic Growth:

    SOURCE: Q2 2019 Conference Call https://investors.cerner.com/static-files/94b34e51-48a4-457e-81e0-4b6d6c948288

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