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Athena EHR settlement is win for whistleblowers exposing kickbacks, fraud

The recent settlement by electronic health records vendor athenahealthcare shows how whistleblowers are continuing to play a key role in exposing EHR kickbacks and fraud.

Athenahealthcare Inc. agreed to pay $18.25 million to resolve two whistleblower lawsuits and a government complaint that alleged the ERH vendor paid illegal kickbacks to boost sales of its EHR software, athenaClinicals.

DOJ said Athena engaged in three marketing programs that violated the False Claims Act and the Anti-Kickback Statute.

As part of one marketing program, Athena invited prospective and existing customers to “Concierge Events,” designed to build good will with clients. Guests allegedly received free tickets to top-tier sporting events like the Masters Tournament and the Kentucky Derby as well as complimentary travel, luxury accommodations, meals and alcohol.

The second marketing program allegedly involved kickbacks for referrals. Athena allegedly paid kickbacks of up to $3,000 to existing customers for each new client that signed up for Athena’s services, regardless of how much time, if any, the existing customer spent speaking to the new client or meeting with the new client.

The third marketing program was targeted at competing EHR vendors that were discontinuing their products. Athena allegedly made deals for referrals with those EHR vendors, paying them kickbacks for referrals based on the value and volume of business that Athena gained.

Fraud involving EHR software can undermine physician’s best practices and the quality of care they provide as well as endanger patients’ health. It also can drain taxpayer funds, which were used to provide incentive payments to healthcare providers to buy and use EHR software.

The first-ever False Claims Act case against an EHR vendor that was settled underscores this potential danger. In 2017, EHR vendor eClinicalWorks paid the government $155 million to settle the ground-breaking whistleblower case brought on behalf of a client by Phillips & Cohen LLP.

The qui tam complaint and the government alleged that eClinicalWorks paid kickbacks, falsely certified its electronic health records met government criteria and violated the False Claims Act in other ways, such as failing to sufficiently test software before it was released and failing to correct long-standing critical and urgent problems and bugs in eCW’s software.

The government has since settled similar cases involving EHR software, such as one against Greenway Health that settled for $57.25 million settlement and a kickback case against Practice Fusion that settled for $145 million in 2020.

Whistleblowers, particularly those in the EHR or healthcare industry, are essential to uncovering flawed EHR software and exposing illegal conduct by EHR vendors. As industry insiders, EHR whistleblowers might have first-hand insights into poorly coded software and improper business dealings.

Under the False Claims Act, whistleblowers are able to file lawsuits on behalf of the government when government funds are being lost to fraud. Whistleblowers who file qui tam lawsuits are entitled to protection against job retaliation and a reward based on the amount the government recovers as a result of their cases.

The reward for the three Athena whistleblowers who filed the two qui tam lawsuits had not been determined as of Jan. 28, when DOJ announced the settlement.

Those who are aware of kickbacks by EHR vendors or other issues with EHR software should consult with an experienced whistleblower lawyer who can answer questions based on their circumstances and advise them about their options.


Phillips & Cohen is the most successful law firm representing whistleblowers, with recoveries from our cases totaling over $12.3 billion. We have been recognized for our work by numerous national awards. Our attorneys and cases have been in The New York TimesThe Wall Street Journal, the Financial Times and other news media. Three of our cases were featured in the CBS series, “Whistleblower.” Phillips & Cohen’s roster includes former federal prosecutors, the first head of the SEC Office of the Whistleblower, a former deputy administrator of the Centers for Medicare and Medicaid Services, the author of a leading treatise on the False Claims Act and attorneys with decades of experience representing whistleblowers. Contact us.





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