Epic Systems Corporation is a privately held American healthcare software company. It’s one of the leading providers of electronic health record (EHR) systems, serving hospitals and healthcare organizations worldwide. Electronic health records have come to almost entirely replace the paper patient files long used by medical professionals. Its principal offices are in Wisconsin.

One of its less dominant competitors is Particle Health a healthcare data platform that provides access to a vast network of patient medical records through APIs. It acts as a bridge, connecting digital health companies with healthcare providers and data sources. Essentially, it simplifies the process of acquiring and integrating patient data, making it easier for innovators to develop new healthcare solutions.Particle is also a privately held company with offices in New York.

Particle has just filed litigation against Epic which seeks an adjudication that Epic has violated the Sherman Act – the cornerstone of U.S. antitrust enforcement – as well as monetary damages and injunctive relief compelling Epic to cease its anticompetitive conduct.

Particle’s lawsuit alleges that Epic is using its dominance in the electronic health records (EHR) market to prevent competition in the payer platform market. This emerging market holds the promise of transforming historically inefficient, paper- and fax-based processes into scalable systems for analyzing health records, predicting patient risk, and informing better care decisions. Like others in this emerging sector, Particle relies on the safe and secure exchange of health information. Epic’s actions have inappropriately hindered this exchange, the complaint alleges.

Particle claims “Epic’s manipulation of EHR access is already having negative consequences for doctors and patients”. The complaint details how a network of community oncology practices has seen over 2,800 patients’ quality of care harmed, due to Epic deliberately blocking important clinical information to doctors who work on Epic’s EHR software. These are records that providers who use Epic systems should have received – and which Particle has attempted to deliver – but which have been blocked by Epic.

Particle alleges that by “providing the software that stores the majority of American medical records, Epic gains control over a crucial resource: the medical records themselves. When a healthcare provider uses an EHR platform to collect, store, and organize medical records, the EHR company typically gains control over the distribution of those records to third parties, such as other healthcare providers or health insurance providers. In the U.S., somewhere between 81-94% of patients have at least one medical record stored in an Epic EHR. Epic is thus by far the dominant supplier of electronic medical records to third parties.”

“The problem this lawsuit addresses is that Epic is now attempting to use its power over EHRs to expand its dominance into the fledgling market for ‘payer platforms.’ A payer platform is a relatively new type of software platform that allows health insurance providers (also known as ‘health plans’ or ‘payers’) to efficiently request and instantaneously retrieve large numbers of medical records directly from the EHR platforms that generate and store them. In addition to obtaining the records at scale, payer platforms allow users to store the records, run analytics, and conduct other business-critical tasks within a self-contained system.”

The lawsuit goes on to claims that until” recently, payers obtained medical records – which are a critical part of their business – through a cumbersome, manual process. Payer platforms digitize and automate this process, helping health plans drastically improve their performance by reducing error-driven denials, providing better health-enhancing services to members, and generating more complete pictures of their members’ health and risk. The Epic Payer Platform (‘EPP’) is by far the largest payer platform in the nation.”

Epic released EPP in 2021, and, as the first payer platform, quickly gained customers. But, although the new market was growing rapidly, no competitors emerged to challenge EPP during the first few years of its existence.

Particle goes on to allege “No competitors could challenge EPP because Epic made it commercially impossible for any payer platform other than EPP to access records stored in Epic’s EHR software. Without the ability to pull Epic-stored records – which constitute a substantial majority of all medical records in the United States – and provide those records to payers at scale, any hypothetical competing payer platform was dead on arrival.”

Plaintiff Particle Health Inc. however, alleges it “solved this problem and is the only competitor in the payer platform market ever to pose a meaningful threat to EPP’s market share. Founded in 2018, Particle began offering its services a few years later. Particle’s platform, like EPP, provides both a record retrieval service, which allows users to interface with EHR companies like Epic to smoothly request medical records at scale, and an analytics service, which allows users to efficiently store and monitor trends in the medical records they request.

In 2023, Particle claims became the first competitor to figure out how to compete with EPP by being the first to recognize and respond to a seismic shift in how payers operate.

The lawsuit goes on to claim that “Epic first became aware of Particle’s entry into the payer platform market in late 2023, when it learned that a Particle customer was utilizing the Particle platform to provide EHRs to Blue Cross Blue Shield of Michigan. Epic immediately began to raise baseless complaints with Particle to intimidate it into exiting the market,”

Verona, Wisconsin-based Epic in a statement called Particle’s claims “baseless” and said it will “vigorously defend itself against Particle’s meritless claims.”

The case is Particle Health Inc v Epic Systems Corp, U.S. District Court for the Southern District of New York, No. 1:24-cv-07174.