Medfusion, Allscripts' Ugly Divorce is Laid Out in Lawsuit
The Medfusion, Allscripts relationship has taken a turn for the worse, with the Cary, N.C.-based provider of patient portal technologies suing the Chicago-based provider of electronic health record (EHR) systems.
The two companies previously ended their strategic relationship in April of this year over financial disputes, although Medfusion said it would temporarily provide its online patient portal to approximately 30,000 Allscripts providers to avoid disruption. The lawsuit seeks punitive damages worth $4.5 million in payments from Allscripts. Medfusion alleges that Allscripts' billing problems caused negative financial consequences to Medfusion due to the backlog that was worth more than $10 million.
The companies made a five-year agreement in 2009. However, in 2013, Allscripts acquired Jardogs, which is a patient portal vendor that rivals Medfusion. According to the suit, Allscripts announced the acquisition at the HIMSS conference and gave virtually no advance notice to Medfusion. Medfusion says it had prepared to jointly market with Allscripts at the show. The suit says that with 18 months left on the five-year contract, Allscripts made Jardogs' products its preferred solution. They say Allscripts created marketing material, which stated the Jardogs product was better than their Medfusion portal.
The suit also says that it converting customers who were waiting to have Medfusion's portal implemented. Allscripts failure to speed up this process for potential portal users led to Medfusion's $10 million backlog the company says. It said the company had $5.46 million in owed money from Allscripts and that the company had paid $993 thousand in respond. This is how they got the $4.5 million number.
“The good part for us is now that the relationship is terminated, we’re in a lot better position to bring innovation to our clients,” Medfusion CEO Steve Malik said to BizJournals.com.
Allscripts said they do not comment on pending litigation.
