athenahealth Will Pay $18.25 Million To Settle Kickback Allegations

EHR developer athenahealth has agreed to pay $18.25 million to resolve allegations that it violated the federal False Claims Act by paying kickbacks to generates sales of its athenaClinicals product.

In its complaint, the US Justice Department claimed that athenahealth violated the False Claims Act and Anti-Kickback Statute by running questionable marketing programs.

One of the activities targeted by the US DoJ was athenahealth’s alleged practice of inviting prospects to luxury vacations. Between June 2014 and March 2019, the vendor treated prospects to all-expense-paid sports, entertainment, and recreational events. Some of these junkets, such as tips to the Masters Tournament and the Kentucky Derby, included fully paid for travel, luxury accommodations, meals and alcohol, according to the complaint.

Another issue the DoJ had with athenahealth was the structure of a lead generation program it ran under which it paid up to $3,000 per physician that signed up for athenahealth services, regardless of how much time the client spent speaking with or meeting the lead.

Also, the Department alleged that athenahealth entered into agreements with competing companies under which when they decided to discontinue their HIT products, they would refer their clients to athenahealth. The agency says that under these agreements, which it called “conversion deals,” athenahealth paid competitors based on the value and volume of practices that were eventually converted into athenahealth customers.

The DoJ argues that as a result of these activities, athenahealth generated sales improperly, and in turn, caused providers to submit false claims to the federal government under the meaningful use program.

In addition to resolving the federal government’s allegations regarding athenahealth, the settlement resolves allegations included in two whistleblower lawsuits.

This news reminds us that False Claims Act continue to emerge even though the meaningful use program is a thing of the past.

In March 2019, a pair of former employees filed suit against Community Health Systems, accusing the national healthcare organization of requesting hundreds of millions in federal incentive payments.

According to the suit, CHS submitted attestations for incentive payments for several years using an EHR from vendor Medhost, which is also named in the suit. The hospital chain received more than $450 million in such payments between 2012 and 2015.

Meanwhile, the feds continue to be on the prowl for kickbacks. In January 2020, the DoJ announced that EHR vendor Practice Fusion had agreed to pay $145 million to settle allegations that it engaged in a kickback scheme designed to increase opioid prescriptions, as well as causing customers to submit false meaningful use claims by misrepresenting the capabilities of its EHR system.

UPDATE: A spokesperson for athenahealth sent us the following statement:

athenahealth places the highest priority on compliance with all laws and regulations governing our industry.  Our dedicated employees work every day to create a thriving ecosystem that delivers accessible, high quality, and sustainable healthcare for all, through innovative products and services on an interconnected network of more than 160,000 healthcare providers and 100 million patients.  We do so ethically and with integrity—values that are integral to our company’s culture.  While we have full confidence in our robust compliance policies and programs, we agreed to this settlement—under which we admit no wrongdoing—to put this matter behind us and move forward with our critical work on behalf of patients and healthcare providers.

About the author

Anne Zieger

Anne Zieger

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

Add Comment

Click here to post a comment