Modernizing Medicine Inc. (ModMed), an electronic health record (EHR) technology vendor located in Boca Raton, Florida, has agreed to pay $45 million to resolve allegations that it violated the False Claims Act (FCA) by accepting and providing unlawful remuneration in exchange for referrals and by causing its users to report inaccurate information in connection with claims for federal incentive payments. The Anti-Kickback Statute prohibits anyone from offering or paying, directly or indirectly, any remuneration — which includes money or any other thing of value — to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. In a complaint filed in conjunction with the settlement, the United States alleged that ModMed violated the FCA and the Anti-Kickback Statute through three marketing programs: First, ModMed solicited and received kickbacks from Miraca Life Sciences Inc. (Miraca) in exchange for recommending and arranging for ModMed’s users to utilize Miraca’s pathology lab services. Second, ModMed conspired with Miraca to improperly donate ModMed’s EHR to healthcare providers in an effort to increase lab orders to Miraca and simultaneously add customers to ModMed’s user base. Third, ModMed paid kickbacks to its current healthcare provider customers and to other influential sources in the healthcare industry to recommend ModMed’s EHR and refer potential customers to ModMed.
