Practice Fusion's EHR software is free, but it is sponsored by pharmaceutical companies.
The San Francisco-based EHR vendor raised $157.5 million in venture capital funding and stores patient data remotely, processing it and sending alerts to physicians when a patient needs a vaccination update or medication refill. Into those alerts is tucked an funding notification from pharmaceutical companies, such as Merck & Co., putting that company's name in a physician's eyesight, according to the Wall Street Journal.
Practice Fusion commands 6.7 percent of the total market share, according to a report by SK&A, which translates to approximately 112,000 provider users and 5.5 million office visits per month. To keep the system available for free, the company sells de-identified patient data to drug companies and other customers and offers advertising spots to drug companies to reach physicians, according to the report.
Some have raised ethical questions as to whether this practice violates anti-kickback laws. Pharmaceutical companies are regulated in the number of ways they can advertise directly to physicians, and free software subsidized by drug company advertisements could fall under that law, according to the report.
Alerts are becoming more common in the EHR market. Epic offers alerts through its system but does not sell sponsorships. Athenahealth does not sell sponsorships on its system but does on its medical reference mobile app. Practice Fusion executives have claimed the practice is ethical and does not violate anti-kickback laws, according to the report.
"It's a fine line between recommending some kind of guidelines-based care versus recommending something that is marketing or sales-driven," Joseph Kvedar, MD, vice president of connected health at Partners Healthcare, told the Wall Street Journal. "It's dicey."