NextGen Will Pay $31M to Settle False Claims Allegations

DOJ says the EHR vendor 'falsely obtained certification for its software.'

NextGen Healthcare Inc. will pay $31 million to resolve whistleblower allegations that the electronic health records (EHR) vendor lied about its software's capabilities and paid kickbacks to users who shilled their product, the Department of Justice announced.

NextGen has denied the allegations, which occured nearly a decade ago, and says it settled with DOJ to avoid lengthy and costly litigation.

In a civil complaint filed with the settlement, DOJ says NextGen "falsely obtained certification for its software in connection with the 2014 Edition certification criteria published by the Department of Health and Human Service's Office of the National Coordinator."

Specifically, DOJ alleges that NextGen "relied on an auxiliary product designed only to perform the certification test scripts, which concealed from the certifying entity that NextGen's EHR lacked critical functionality."

Because of that, DOJ says the EHR that NextGen sold to providers lacked mandated functions, including the ability to record vital sign data, translate data into required medical vocabularies, and create complete clinical summaries. 

DOJ also alleges that NextGen violated the Anti-Kickback Statute when it gave credits worth as much as $10,000 to existing customers whose recommendation of NextGen's EHR software led to a new sale. The kickbacks also included tickets to sporting events and other entertainment.

"Electronic health records play a pivotal role in the provision of safe, effective healthcare, and the testing and certification process of the EHR Incentive Program was intended to provide assurances to providers that their EHR can perform certain important functions," U.S. Attorney Nikolas P. Kerest for the District of Vermont, the lead prosecutor of the case, says in a media release. "With this settlement, our office has now resolved five investigations into misconduct by EHR companies, demonstrating our commitment to ensuring that EHR companies are held responsible for their misrepresentations."

The settlement resolves claims brought under whistleblower provisions of the False Claims Act by Toby Markowitz and Elizabeth Ringold, healthcare professionals at a facility that used NextGen's software, who will receive $5.6 million.

NextGen Responds

NextGen issued the following statement in response to the settlement.

"The company denies that any of its conduct violated the law, and the settlement agreement does not include any admissions of wrongdoing. This agreement relates to claims from more than a decade ago. The settlement resolves the matter without monitoring or changes to NextGen Healthcare's products or compliance policies. To avoid the distraction and expense of litigation, we believe it is in the best interest of the company to put this historical matter behind us and keep our attention focused on innovating solutions that enable better healthcare outcomes for all."