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Konica Minolta Settles EHR False Claims Case for $500,000

Konica Minolta Healthcare Americas Inc. has agreed to pay a $500,000 financial penalty to settle a case against its former subsidiary, Viztek LLC, to resolve False Claims Act violations related to its electronic health record (EHR) product.

The American Recovery and Reinvestment Act of 2009 established the Medicare & Medicaid EHR Incentive Programs to encourage healthcare providers to adopt a certified EHR. Healthcare providers that adopted a certified EHR were entitled to claim incentive payments to offset the cost purchasing the solution, provided they were able to demonstrate meaningful use of the EHR technology.

Companies that developed and marketed EHR solutions were required to demonstrate that their products met the HHS-adopted criteria and obtain certification for their solutions. According to a Viztek whistleblower, a former product manager at the company, Viztek and Konica Minolta Healthcare had falsified testing results of the Viztek solution, EXA EHR, in 2015 and misrepresented the capabilities of the product. Konica Minolta acquired Viztek in October 2015 during the period when the EHR was being tested.

The whistleblower filed a lawsuit against Viztek and Konica Minolta in December 2017 under the whistleblower provisions of the False Claims Act, alleging that as a result of the falsified testing results, healthcare providers using the solution had submitted false claims to the HHS for EHR incentive payments in 2015 and 2016.

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According to the lawsuit, the capabilities of EXA EHR that were necessary to obtain certification had not been built into the product at the time of testing. Viztek attested to EHR testing company Infogard that the product met the HHS-adopted criteria, and hard-coded the software to ensure it passed the certification tests, even though the solution could not support the applicable criteria for its customers.

Infogard was also named as a defendant in the lawsuit. The lawsuit alleged Infogard either knew that EXA EHR did not meet all applicable requirements for certification or recklessly disregarded the fact that it did not meet the required criteria.

Under the Whistleblower provisions of the False Claims Act, the whistleblower is entitled to share in any settlement if they bring civil actions on behalf of the U.S government. The whistleblower is due to receive $100,000 of the settlement amount.

Author: Steve Alder is the editor-in-chief of HIPAA Journal. Steve is responsible for editorial policy regarding the topics covered on HIPAA Journal. He is a specialist on healthcare industry legal and regulatory affairs, and has several years of experience writing about HIPAA and other related legal topics. Steve has developed a deep understanding of regulatory issues surrounding the use of information technology in the healthcare industry and has written hundreds of articles on HIPAA-related topics.