The Sixth Circuit recently became the first appellate court to consider and reject FCA liability based on a healthcare provider’s alleged false attestation of compliance with the Health Information Technology for Economic and Clinical Health Act (HITECH) Act’s meaningful use objectives. U.S. ex rel. Sheldon v. Kettering Health Network, 2016 WL 861399 (6th Cir. March 7, 2016). The HITECH Act was designed to encourage the adoption of Electronic Health Record (EHR) technology by healthcare providers through the creation of incentive payments for eligible providers.  As a condition of receiving those incentive payments, the HITECH Act requires healthcare providers to meet meaningful use objectives and compliance measures concerning the adoption of EHR technology.

The relator alleged that Kettering failed to meet the HITECH Act’s meaningful use objectives and compliance measures after Kettering informed relator of isolated breaches of the medical records of the relator and certain family members. In addition, the relator alleged that Kettering failed to run “CLARITY” reports from Kettering’s software system, which would have helped Kettering to monitor improper access to patient medical records. Based on these allegations, the relator claimed that Kettering’s meaningful use attestation was false and that this false certification resulted in improper meaningful use incentive payments being made to Kettering.

The Sixth Circuit affirmed the district court’s dismissal of relator’s theory of FCA liability, holding that “attestation of compliance [with the HITECH Act] is not rendered false by virtue of individual breaches.” The Sixth Circuit also held that allegations of occasional breaches of EHR, without more, cannot support an inference that a provider lacked policies and procedures necessary for HITECH Act compliance.  To the contrary, the Sixth Circuit noted that the allegations in the complaint indicated that Kettering, in fact, did have security policies and procedures in place and specifically referenced the letters from Kettering to the relator notifying her of the breach it had discovered after conducting an internal investigation.

With respect to the relator’s allegations concerning the CLARITY reports, the Sixth Circuit held that compliance with the HITECH Act did not “require that providers adhere to a particular schedule for running reports, or to purchase and use a particular brand of EHR software.” As such, the Sixth Circuit held that the relator failed to adequately plead the “false statement” element of her FCA claim.  The Sixth Circuit’s refusal to allow a relator to use the FCA to enforce HITECH compliance should be encouraging for healthcare providers grappling with EHR issues.

The Sixth Circuit also held that the complaint failed to meet the FCA’s heightened pleading standard Rule 9(b), by failing to allege a specific false claim for payment. According to the Sixth Circuit, the relator’s allegation that Kettering received meaningful use payments “as a result” of false certification equates to an allegation that claims “must have been submitted,” which is insufficient to plead fraud with particularity.  As the court noted, “[m]erely implying that attestations ‘must have been submitted’ by certain unnamed providers in the [provider’s] network does not satisfy Rule 9(b).”