Lawsuit: Epic's Software Double-Bills Medicare, Medicaid for Anesthesia Services

Health IT giant Verona, Wis.-based Epic Systems has been hitwith a False Claims Act lawsuit that alleges the company's softwaredouble-bills Medicare and Medicaid for anesthesia services, resulting in thegovernment being overbilled by hundreds of millions of dollars.

The lawsuit, which was filed under the qui tam provision ofthe False Claims Act in 2015 and made public Thursday, alleges Epic's billingsoftware's default protocol is to charge for both the applicable base units foranesthesia provided on a procedure as well as the actual time taken for theprocedure. This results in the provider being reimbursed twice for the baseunit component, according to the lawsuit.

According to the lawsuit, Medicare adjusted its paymentapproach to anesthesia services in 2012 to require physicians to bill for theactual time on a procedure instead of 15-minute blocks of time. The suitalleges Epic's software allowed hospitals to set up their anesthesia billingmodules to bill for 15-minute increments in addition to the actual timeanesthesiologists spent on the procedure.

The whistle-blower who filed the lawsuit, GeraldinePetrowski, worked at Raleigh, N.C.-based WakeMed Health from September 2008through June 2014. In her role as supervisor of physician's coding, Ms.Petrowski served as the hospital liaison for Epic's implementation of itssoftware at WakeMed Health.

Ms. Petrowski claims she provided examples to Epic representativesillustrating the double-billing practice, and the company initially ignored hercomplaints. "It was only after relator, Petrowski, reiterated herdirection to fix this software setting that [Epic] relented and fixed it onlyfor the WakeMed Health facility," according to the lawsuit.

The lawsuit alleges the unlawful billing protocol hasresulted "in the presentation of hundreds of millions of dollars infraudulent bills for anesthesia services being submitted to Medicare andMedicaid as false claims."

In a statement to HealthcareIT News, an Epic spokeswoman said, "The plaintiff's assertionsrepresent a fundamental misunderstanding of how claims software works."

The Department of Justice declined to intervene in the case,and the whistle-blower will move forward in the case without the government.