Agnesian HealthCare sues Cerner over coding errors within its billing and scheduling software

lawsuit and book
Agnesian HealthCare says flaws in Cerner's billing and scheduling software led to at least $16 million in damages and hurt its reputation.

Wisconsin-based Agnesian HealthCare claims coding errors within Cerner's billing and scheduling software cost the health system at least $16 million and counting.

complaint filed with a Wisconsin circuit court in Fond du Lac County alleges that Agnesian integrated Cerner’s billing, scheduling and claims software in August 2015 but immediately encountered “pervasive errors” on inpatient billing statements that forced the provider to “expend extraordinary amounts of time and financial resources” to process claims manually.

After Cerner said the coding errors were resolved, Agnesian discovered coding errors earlier this year that caused claims to automatically write off reimbursable charges, according to the complaint.

RELATED: EHR vendor CliniComp sues VA over no-bid contract with Cerner to replace VistA

Although the hospital said it hadn’t been able to “fully quantify the damages caused by Cerner’s wrongful conduct,” it estimated that the software defects had cost at least $16 million to date and continued at a clip of at least $200,000 per month.

The integrated health system also said the software complications had caused "grave damage" to its reputation in the community. 

“Thousands of Agnesian patients have been subject to the stress of not being able to reconcile their billing statements to the healthcare services provided, resulting in the sustained erosion of the community's confidence in Agnesian.”

Last week, Cerner filed a motion to dismiss the lawsuit, pointing to a binding arbitration agreement between the two companies. Alternatively, Cerner has requested that the case be moved to the United States District Court for the Western District of Missouri, where Cerner is headquartered, arguing it is the “appropriate forum for a federal court to compel arbitration.”

“Cerner disagrees with the allegations and will aggressively defend the case," Cerner spokesperson Misti Preston said in an email to FierceHealthcare. 

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