What urologists can learn from EHR fraud case

Robert A. Dowling, MDIn May 2017, the U.S. Department of Justice (DOJ) announced a $155 million settlement with one of the nation’s largest electronic health records vendors-eClinicalWorks (ECW). In its complaint, which was initiated by a whistleblower, the government charged ECW with violations of the False Claims Act (FCA) and the federal Anti-Kickback Statute (AKS) (bit.ly/ECWcomplaint).

While the settlement has been newsworthy for its potential impact on the heavily regulated vendor community (bit.ly/ECWimpact), it also serves as a reminder to all physicians that the DOJ is serious about enforcing these statutes. In this article, I will review this settlement, the statutes that formed the basis for the complaint, and its relevance to practicing urologists.

DOJ alleges false statements

In the recently announced settlement, the DOJ alleges that ECW:

• made false statements about compliance with certain certification criteria. Specifically, the DOJ accused ECW of falsely representing that it was compliant with a functionality to implement a drug vocabulary called RxNorm into its prescribing software. The DOJ further alleged that ECW “hardcoded” the software specifically to pass that portion of the certification test pertaining to RxNorm functionality.

• failed to properly satisfy other certification criteria including data portability, audit logs, imaging orders, and drug interaction checking

• made payments to referral sources and consultants that violate the AKS. Allegations include:
• Practices were paid up to $500 for a referral that executed a contract with ECW.

• Practices were paid to host site visits based upon the number of potential prospects.

• Users were paid up to $250 to be references and a bonus if a purchase was executed.

• Fees were paid for promotion of ECW products.

• Off-the-books fees were paid to a consultant for sourcing new customers.

ECW, for its part, admitted no wrongdoing under the settlement, and will be subject to further scrutiny under a Corporate Integrity Agreement with the Office of Inspector General (OIG) at the Department of Health and Human Services (bit.ly/ECWsettlement). The whistleblower in the case stands to profit handsomely-by some reports up to $30 million (bit.ly/ECWwhistleblower).

Next: How statutes could apply to urologists

Setting aside the specific implications of the ECW settlement for health IT vendors, their customers, and their customers’ patients for a moment, the settlement presents an opportunity to review these statutes and how they could directly apply to urologists. An excellent primer on the FCA is available online (bit.ly/FCAprimer). Among the activities prohibited by the FCA are: knowingly presenting a false claim for payment, making a false statement material to support a false claim, and conspiring with other individuals to seek payment on a false claim. In addition, violation of the AKS is a per se violation of the FCA (bit.ly/ECWcomplaint). Some have interpreted liability under this statute (FCA) for physician upcoding, unbundling, and billing for medically unnecessary services (bit.ly/Fraud101).

Also by Dr. Dowling: Measure practice safety, quality with this DIY tool

The civil penalties under FCA are significant-$5,000-$10,000 for each false claim-and double to treble the amount of the government’s damages depending on certain conditions. One need look no further than the website of the HHS OIG for examples of enforcement and settlement actions involving scores of physician practices and invoking the FCA (bit.ly/HHSOIGexamples).

While the ECW settlement involved no allegations of physicians directly violating the FCA, it does serve as an example of enforcement activities in health care and the determination of the government to prosecute companies and individuals. Also, it is noteworthy that the DOJ accused ECW of causing physicians to submit false information to the government-since they attested to meaningful use and received federal incentive dollars on the premise that they were using certified EHR technology.

The AKS imposes criminal and civil penalties for “the knowing and willful offer, payment, solicitation, or receipt of any remuneration, in cash or in kind, to induce or in return for referring an individual for the furnishing or arranging of any item or service for which payment may be made under a federal health care program. Remuneration means anything of value and can include gifts, under-market rent, or payments that are above fair market value for the services provided. Criminal penalties for violation are a fine of up to $25,000 and imprisonment for up to 5 years.” (bit.ly/Fraudlawguide).

Read: How will quality be measured under MIPS?

In the ECW case, the DOJ alleged payments were made to physician practices to induce referrals to ECW and promote the company and its services. Those practices contemplating hosting site visits to showcase treatments, procedures, or technology may wish to consult with their attorney before entering into any formal or informal arrangements with industry vendors. Finally, physicians acting as part-time consultants to vendors-including but not limited to health IT and other technology companies-should review those arrangements carefully for compliance with these and other statutes.

Next: 'Litmus test' for industry relationships

‘Litmus test’ for industry relationships

CMS has published a helpful booklet for physicians entitled “Avoiding Medicare Fraud and Abuse” (bit.ly/Fraudroadmap). The booklet outlines a “litmus test” you can conduct to decide whether a relationship with industry is safe and appropriate: “If your contribution is your time and effort or your ability to generate useful ideas and the payment you receive is fair market value compensation for your services without regard to referrals, then, depending on the circumstances, you may legitimately serve as a bona fide consultant. If your contribution is your ability to prescribe a drug, use a medical device, or refer patients for particular services or supplies, the potential consulting relationship likely is one you should avoid as it could violate fraud and abuse laws.”

Also see - Value-based pay in 2017: Where does urology fit?

Bottom line: The ECW settlement serves as a cautionary tale that a complex set of federal statutes governs health care reimbursement, and physicians may be liable under one or more of these statutes for civil or criminal penalties. A baseline understanding of the False Claims Act, Anti-Kickback Statute, and other relevant laws is a necessary part of practicing medicine in the modern age.

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