An inside look at Epic’s confidential vendor services agreement

Startups have for years complained about the difficulty of working with Epic, the electronic health record company with the largest hospital market share in the country. But there’s been very little publicly available documentation to demonstrate that in practice. That’s largely because people are afraid to publicly air grievances about Epic for fear they’ll be blacklisted from their ecosystem and data.

A company shared an Epic’ Vendor Services Agreement with Second Opinion to give the healthcare community a sense of what startups struggle with when it comes to Epic.

I shared Epic’s Vendor Services agreement with Sharona Hoffman, professor of law and bioethics at Case Western Reserve University, who says it strongly favors Epic. 

“There is no provision that jumps out as blatantly illegal,” Hoffman told Second Opinion, “but it sort of accumulates all these very, very one-sided—and perhaps questionable— provisions that perhaps together would raise a lot of questions about whether this contract is unconscionable and perhaps unenforceable.”

For example, she says, with 30 days’ notice, Epic can change the details of the vendor services agreement at any time.  “The words ‘at Epic's sole discretion’ appear a lot,” notes Hoffman. 

In response to a request for comment about the vendor services agreement, Epic confirmed the document and informed Second Opinion that the vendor services agreement was updated today, because of confusion over some of the provisions in it. The company sent over the following statement: 

“We regularly update our agreements to reflect the ongoing evolution of our programs. As an example, we recently removed a section pertaining to employment practices that confused vendors and was not applicable to many of them.”

Despite these changes, we are still going to look at the vendor services agreement of yore and compare it to the new contract.  A copy of the legal services agreement shared with me by one founder, who requested anonymity for fear of retribution, is pasted below for our premium subscribers.

Hoffman notes that Epic caps the damages they can incur from the vendor. The provision caps Epic’s liability at fees paid the preceding 12 months with complete exclusion of consequential damages, she said. “No lawyer is going to take that case because they can't make money,” she said. 

Though this stuck out to Hoffman, Epic is not the only company that caps its liability in contracts. Apple caps its own liability at $50 in its contract with developers that build and sell apps in its App Store.