Epic's countermove: Calls for Carequality, Particle Health to go public with patient privacy dispute

Editor's note: This story has been updated with a statement from Particle Health and Carequality. It also has been edited to accurately report that Carequality supports the exchange of 1 billion clinical documents a month.

Electronic health records giant Epic wants a behind-the-scenes dispute with Particle Health over patient data made public, saying the startup has mischaracterized the events in its antitrust lawsuit.

It's the latest move between the two companies after Particle Health filed a lawsuit against Epic five days ago alleging anti-competitive practices.

Particle Health filed the lawsuit in the Southern District of New York alleging that Epic is trying to muscle out competition. The 81-page lawsuit (PDF) argues Epic engaged in monopolistic, anti-competitive practices, using its "power over EHRs to expand its dominance into the fledgling market for payer platforms," according to the lawsuit, which was reviewed by Fierce Healthcare.

Particle Health alleges in its federal complaint that Epic has not only engaged in anticompetitive behavior but has purposefully blocked the exchange of patient information.

The lawsuit, in part, stems from developments last spring and growing tensions between the two companies over access and use of patients' clinical data.

Both Epic and Particle Health are connected to Carequality, which operates a nationwide health data exchange service used by more than 600,000 care providers, 50,000 clinics and 4,200 hospitals to access patients’ medical records. Carequality says it supports the exchange of 1 billion clinical documents each month.

Epic filed a formal dispute with Carequality on March 21, claiming that Particle was sharing patient data with some companies who were then using the data for reasons unrelated to treatment. "This poses potential security and privacy risks, including the potential for HIPAA Privacy Rule violations in the event disclosures of protected health information were made under the Treatment Permitted Purpose when the requesting entities did not have treatment relationships with the patients to whom the records related,” Epic said in the notice to its customers, which was viewed by Fierce Healthcare.

In a statement issued Friday, Epic said it filed the dispute against Particle Health at the direction of its customer governing council "because some Particle customers used the network to take people’s medical records under false pretenses."

"For example, a business, Integritort, claimed to be treating patients when in fact it was gathering medical records for personal injury law firms to review for potential class action lawsuits," Epic said in its statement.

In the ensuing months, there has been a closed-door resolution process involving Carequality’s Steering Committee, which issued a resolution. 

In its lawsuit, Particle Health detailed the Carequality Steering Committee's decision in the dispute, the first time it's been publicly disclosed. Particle said the steering committee fully agreed with Particle’s arguments, "expressly finding that Particle did absolutely nothing wrong and that Particle acted within the law and Carequality rules."

The Steering Committee, however, imposed a 'corrective action plan' on Particle that "gave Epic much of what it wanted while expressly disclaiming any finding of wrongdoing by Particle," the company wrote in the lawsuit.

Epic shot back, saying Particle "publicly mischaracterized the resolution," in its statement.

Now, Epic is requesting Carequality to release the resolution immediately so that "patients, healthcare organizations, other network participants, interoperability advocates, lawmakers, and journalists can evaluate the facts for themselves," and its calling on the health data company to support making the resolution public.

In a statement provided to Fierce Healthcare, a Particle spokesperson said, “CareQuality asked that the resolution remain confidential. If CareQuality wishes to release it now, we have no objection.”

Alan Swenson, Carequality's executive director, said in a statement to Fierce Healthcare that the resolution, which was confidentially shared with Epic and Particle Health, is still subject to appeal.

"To preserve the integrity of our confidential process, we will disclose more information once the process has come to a conclusion," Swenson said.

He also noted, “Carequality is committed to the integrity and transparency of our interoperability framework. Our independent and non-biased dispute resolution process has established procedures to consider all relevant information and reach an outcome that preserves trust, improves our framework, and reaches the best outcome for our community."

Particle Health, founded in 2018, is a data platform that aggregates health information for digital health companies through APIs, providing access to more than 300 million patients’ medical records. Particle’s platform provides both a record retrieval service, which allows users to interface with EHR companies like Epic to smoothly request medical records at scale, and an analytics service, which allows users to efficiently store and monitor trends in the medical records they request. 

Starting last year, Particle expanded its services to payers to assist so-called "pay-viders" with accessing patients records for “secondary” purposes more typically associated with health insurance, like population health analytics or processing claim, which is allowed under HIPAA and the rules of health information networks, the company said in the lawsuit. 

Tensions between the two companies got heated in April when Epic cut off data requests from some Particle Health customers, citing concerns about potentially inappropriate disclosures of protected health information and privacy risks to patients’ medical data, according to a notice sent to Epic customers April 10. 

Particle Health claims, in its complaint, that Epic's actions have hurt the company in the form of current and future lost customers and revenue. And, the Carequality dispute hindered Particle’s ability to compete and "is yet another example of Epic’s anticompetitive tactics," the company argued.