January 9, 2014

A hospital is suing its EHR vendor. Is it the first suit of many?

Daily Briefing

Mountainview Medical Center in Montana has filed a lawsuit against its electronic health record (EHR) vendor for allegedly failing to meet a contractual deadline for the installation of a system that meets certain criteria of the meaningful use program.

Background on NextGen's EHR system

The EHR meaningful use program was created by the 2009 federal economic stimulus package. Through the program, health care providers who demonstrate meaningful use of certified electronic health record systems can qualify for Medicaid and Medicare incentive payments.

According to Office of the National Coordinator for Health IT records, the Certification Commission for Health Information Technology certified the hospital inpatient EHR system created by NextGen Healthcare Information Systems—Mountainview's EHR vendor—as meeting 2014 Edition meaningful use standards on Nov. 25, 2013, Modern Healthcare reports.

Kill three birds with one stone: Primer on Stage 2 meaningful use measures

Mountainview's complaint

According to the complaint filed in U.S. District Court in Helena last month, Mountainview in September 2012 established an agreement with NextGen that stipulated the vendor would install an EHR system that met 2014 Edition criteria for Stage 1 requirements of the meaningful use program by June 1, 2013. Mountainview said that NextGen failed to meet the initial deadline and that the vendor requested and received an extension until Oct. 1, 2013.

However, Mountainview said that in September 2013 it "learned that NextGen did not have an [EHR] that was certified pursuant to the 2014 [Edition] standards" required for use by hospitals after Oct. 1, 2013. Mountainview in its filings claimed that "NextGen's representations were false and misleading at the time such representations were made."

According to the critical-access hospital, it has spent $441,000 to install the EHR system. Mountainview is seeking compensation for the loss of revenue and federal reimbursement payments. It also is seeking compensation for attorney fees and other court costs.

NextGen spokesperson Michelle Rovner said the EHR vendor would not comment on the pending lawsuit. However, she noted that NextGen "firmly believe[s] the allegations made by Mountainview Medical Center regarding our inpatient application are without merit, and we will defend against them vigorously."

The first lawsuit of many?

Modern Healthcare notes that the Montana hospital may be the first of many organizations to take vendors to court over frustrations with EHR implementation that is either behind schedule or fails to meet new, more stringent requirements under the meaningful use program (Conn, Modern Healthcare, 1/6 [subscription required]; McCann, Healthcare IT News, 1/6).

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