Wisconsin system says Cerner's software caused $16 million in losses

Agnesian HealthCare is suing Cerner Corp. for a botched rollout of a revenue cycle management system, saying that problems caused the Wisconsin system to lose millions of dollars and damaged its reputation. Agnesian says it lost at least $16 million and is claiming $200,000 per month in damages.

Cerner earlier faced lawsuits from a Kansas hospital over implementation of an EHR system and a North Dakota system that alleged its patient-accounting software malfunctioned.

As healthcare systems work to meet meaningful use and Medicare Access and CHIP Reauthorization Act requirements, lawsuits between vendors and their customers may become more common, said Jeffrey Short, a healthcare IT and privacy lawyer with Hall Render. And if Agnesian wins this suit, Short said, “It may embolden others to pursue similar types of claims.”

Problems began as soon as Agnesian began using Cerner’s software in 2015, according to court documents, and the system had to resort to manually processing billing statements. After an initial fix, problems returned a year later, and Cerner told Agnesian that it would have to rebuild the software. Cerner said it disagrees with the allegations and will aggressively defend the case.

Agnesian initially paid $300,000 for the software. Last year the system reported $466.2 million in revenue, according to Modern Healthcare’s financial database.