Epic Systems hit with antitrust lawsuit by Particle Health

WISCONSIN, UNITED STATES — Epic Systems, a prominent electronic health record (EHR) vendor, faces an antitrust lawsuit from intelligent data platform Particle Health.
The lawsuit, filed in the Southern District of New York, alleged that Epic leveraged its dominant position in the EHR market to stifle competition and restrict access to patient data for Particle’s clients
Particle Health claimed that Epic used its control over patient information to undermine its business. The startup specializes in facilitating data sharing and analysis for healthcare organizations and recently entered the payer platform market, which assists insurers in accessing and analyzing medical records.
Allegations of anticompetitive behavior by Epic
According to the lawsuit, Epic is accused of denying health data access to Particle’s customers, effectively blocking competition in the emerging payer market. The lawsuit stated that Epic launched a “multi-pronged campaign” to destroy Particle’s growth and eliminate competition.
The conflict escalated earlier this year when Epic reportedly cut off data requests from some Particle customers, citing unauthorized uses of patient information and potential privacy risks. Particle argues that this move was part of Epic’s strategy to maintain its dominance and prevent new entrants from gaining a foothold in the payer platform sector.
Scrutiny of Epic’s business practices
In March, Epic Systems came under increased scrutiny regarding its methods for maintaining its dominant position in the EHR market. Although Epic’s market share remains below the 50% threshold generally associated with monopolistic status, a report by Forbes identified several practices by the company that approach monopolistic behavior. These practices include:
- Artificially inflating costs for third-party vendors
- Enforcing non-compete clauses and a network of non-solicitation agreements
- Raising fees to unsustainable and anticompetitive levels
- Utilizing bundling, tying, and specific pricing strategies
- Appearing to favor certain market participants over others
- Engaging in vertical market manipulation
- Suppressing competition through the introduction of new products
Impact on Particle Health’s business
Particle alleged that Epic’s actions significantly hindered its revenue growth. The startup claimed that Epic’s refusal to share records slowed down the onboarding process for new customers, extending it from two days to over a month.
Additionally, Particle argued that Epic’s public statements about data security risks have damaged its reputation and eroded public trust.
The dispute also involved Carequality, an interoperability framework that facilitates the exchange of health documents. Epic initiated a dispute process with Carequality, questioning Particle’s reasons for requesting records. This process lasted over five months and required Particle to implement a corrective action plan.
Epic’s defense against allegations
Epic has dismissed the lawsuit as “baseless,” asserting that it complies with all relevant regulations regarding data sharing under HIPAA. In a statement to Healthcare Dive, an Epic spokesperson said that the company’s software is “open and interoperable,” allowing healthcare organizations to share data securely.
“Epic will continue to protect patient privacy and vigorously defend itself against Particle’s meritless claims,” the spokesperson stated.
Epic added that the lawsuit is an attempt by Particle to divert attention from its own alleged violations of HIPAA privacy protections on the Carequality exchange.
Particle Health is seeking monetary damages and an injunction to stop what it describes as Epic’s anticompetitive conduct. This legal battle underscores ongoing tensions in the healthcare technology sector over data access and market competition.