Practice Fusion, Inc. (Practice Fusion), an electronic health record (EHR) vendor acquired by Allscripts in 2018, recently agreed to pay $145 million to resolve criminal and civil investigations related to an illegal kickback arrangement with a major opioid company.

The settlement included $26 million in criminal fines and forfeiture to resolve two felony charges related to Anti-Kickback Statute (AKS) violations.  Pursuant to the settlement, Practice Fusion admitted that “it solicited and received kickbacks from a major opioid company in exchange for utilizing its EHR software to influence physician prescribing of opioid pain medications.”  Practice Fusion acknowledged that it implemented CDS alerts with the intention of increasing the likelihood that doctors would prescribe extended release opioids (“EROs”).  The criminal fine is the largest in the history of the District of Vermont.

Christina E. Nolan, U.S. Attorney for the District of Vermont stated that the arrangement allowed the opioid company “to inject itself in the sacred doctor-patient relationship.”  She added, “The companies illegally conspired to allow the drug company to have its thumb on the scale at precisely the moment a doctor was making incredibly intimate, personal, and important decisions about a patient’s medical care, including the need for pain medication and prescription amounts.

As part of its three-year Deferred Prosecution Agreement, Practice Fusion agreed to adopt a comprehensive compliance program to prevent such abuses from occurring in the future.  Practice Fusion also agreed to pay $118.6 million to resolve civil federal and state False Claims Act (FCA) claims that Practice Fusion misled the government certifying body regarding certain functionalities of its EHR software.

The Practice Fusion settlement represents DOJ’s third civil EHR vendor settlement in recent years, following the eClinicalWorks settlement in May 2017 and the Greenway Health settlement in February 2019.  The U.S. Attorney’s Office for the District of Vermont and DOJ’s Commercial Litigation Branch, Fraud Section, led both matters.  In announcing the eClinicalWorks settlement, U.S. Attorney Nolan stated that “EHR companies should consider themselves on notice.”  This is the first time DOJ has taken criminal action against an EHR vendor.

Photo of Stefanie Doebler Stefanie Doebler

Stefanie Doebler leads the firm’s Health Care Practice Group and is a member of the Food, Drug, and Device Practice Group. She has more than 20 years of experience counseling on health care compliance matters for pharmaceutical, biotech, medical device, and technology clients.

Stefanie Doebler leads the firm’s Health Care Practice Group and is a member of the Food, Drug, and Device Practice Group. She has more than 20 years of experience counseling on health care compliance matters for pharmaceutical, biotech, medical device, and technology clients. She provides pre- and post-market advice related to advertising and promotion, fraud and abuse, digital health, and telehealth. Stefanie also advises on the development and implementation of health care compliance programs and helps clients conduct internal reviews, compliance audits, and risk assessments. Clients say that Stefanie’s advice is practical and solution-oriented. Her work for a broad range of life sciences clients, ranging from start-ups to multinationals, gives her unique insights into industry practices and benchmarking.

Stefanie regularly interacts with Boards of Directors and senior leadership on health care compliance matters in connection with high-stakes strategic matters. She is recognized by clients as a true partner—developing a deep knowledge of their business priorities, operational challenges, competitive pressures, and risk tolerance.

Stefanie works closely with colleagues in other practice areas, such as privacy, government contracts, antitrust, and tax to provide cross-functional assistance to clients and to help anticipate how changes to the law and enforcement landscape could affect their activities. She collaborates with life sciences litigation colleagues to conduct investigations and respond to government inquiries. She also leads health care compliance diligence for complex transactions, including mergers and acquisitions, joint ventures, and public offerings, and she assists with licensing transactions for development and commercialization.

Stefanie counsels in-house counsel and their business partners to ensure that their activities comply with the Federal Anti-Kickback Statute and the Federal False Claims Act; other fraud and abuse laws including the Beneficiary Inducement Act, the Eliminating Kickbacks in Recovery Act, the federal health care program exclusion laws, and similar state laws; the Federal Food, Drug, and Cosmetic Act and FDA’s requirements for medical product advertising; state practice of medicine laws, including corporate practice of medicine and telehealth; state pharmacy laws; price reporting requirements for the Medicaid Drug Rebate Program and Medicare Part B; and the Sunshine Act and state transparency laws.

Stefanie is an avid reader, devouring between 60 and 90 books a year–primarily contemporary literature, historical fiction, and mystery and thrillers. She loves to trade book recommendations with clients.

Read more about Stefanie Doebler
Show more Show less
Photo of Anna D. Kraus Anna D. Kraus

Anna Durand Kraus advises on issues relating to the complex array of laws governing the health care industry. Her background as Deputy General Counsel to the U.S. Department of Health and Human Services (“HHS”) gives her broad experience with, and valuable insight into…

Anna Durand Kraus advises on issues relating to the complex array of laws governing the health care industry. Her background as Deputy General Counsel to the U.S. Department of Health and Human Services (“HHS”) gives her broad experience with, and valuable insight into, the programs and issues within the purview of HHS, including Medicare, Medicaid, fraud and abuse, and HIPAA privacy and security. Anna is co-chair of the firm’s Health Care Industry practice group.

Anna regularly advises clients on Medicare reimbursement matters, particularly those arising under Part B and the Part D prescription drug benefit. She also has extensive experience with the Medicaid Drug Rebate program. She assists numerous pharmaceutical and device manufacturers, health care providers, pharmacy benefit managers, and other health care industry stakeholders to navigate the challenges and opportunities presented by the Affordable Care Act.

Anna is a trusted adviser on health information privacy, security and breach notification issues, including those arising under the Health Insurance Portability and Accountability Act (“HIPAA”) and the Health Information Technology for Economic and Clinical Health (“HITECH”) Act. Her background in this area dates back to the issuance of the original HIPAA privacy regulations.

Anna’s clients depend on her to guide them through compliance with the Anti-Kickback statute, the Stark regulations, and other laws preventing fraud and abuse in the health care industry. Her deep knowledge of these laws has made her an important component of the firm’s representation of pharmaceutical companies and health care organizations under federal investigation or facing allegations under the False Claims Act. In addition, clients contemplating acquisitions in the health care sector rely on her to guide due diligence efforts.

Read more about Anna D. Kraus
Show more Show less