In a pair of hearings this week, Congress ramped up its scrutiny of the Department of Veterans Affairs’ $10 billion contract with Oracle to modernize veterans’ medical records, as the tech giant promised to revamp the troubled computer system it acquired only months earlier.
On Wednesday, a top VA official told a Senate Appropriations subcommittee the electronic health record system developed by Cerner Corp., for which Spokane’s VA medical center has served as the pilot site since October 2020, “needs major improvements.” Oracle acquired Cerner in a $28 billion deal that closed in June.
“Just one vet harmed is one vet too many,” VA Deputy Secretary Donald Remy said. “And right now, the bottom line is that the Cerner system is not delivering for veterans in the ways that it should. Not even close.”
A report released in July by the VA Office of Inspector General, an independent watchdog agency, found 149 cases of harm at Mann-Grandstaff VA Medical Center due to delays in care caused by the system. That report focused on just one of dozens of issues identified by VA patient safety experts, which have caused problems for other veterans, including a Chewelah, Washington, resident now battling terminal cancer after a delayed diagnosis he attributes to the system.
In a joint hearing Tuesday, two House subcommittees heard testimony from the VA’s top contracting officer, who warned that the VA “shouldn’t blindly follow” the Department of Defense, whose acquisition of a similar Cerner system was cited to justify awarding the $10 billion contract to Cerner in 2018 without going through the usual competitive bidding process for such a large federal contract.
That VA official, Chief Acquisition Officer Michael Parrish, told lawmakers his office would hold Oracle accountable to the terms of the existing contract and may renegotiate parts of the deal once the base contract expires in May .
In Wednesday’s hearing, the top Oracle executive in charge of the project told senators his company intends to rewrite the Cerner system as a new, cloud-based application that addresses many of the problems health care providers in Spokane have struggled with for nearly two years. Oracle will release a beta version of that system in 2023, Executive Vice President Mike Sicilia said, and will “deliver it as a cost-free upgrade under the current contract.”
In the same hearing, VA undersecretary for health Shereef Elnahal said he heard from VA employees in a recent trip to a VA medical center in Ohio that problems with the system are causing health care providers to leave their jobs.
“It was something I personally observed in my visit to Columbus,” said Elnahal, who was confirmed by the Senate in July. “Staff told me that this system was stressful to use and leadership told me that folks are leaving, in part because of the difficulty of the workflows.”
After the Cerner system launched in Spokane in 2020, reports of widespread errors and safety risks prompted VA Secretary Denis McDonough to pause the system’s deployment to other facilities, but the rollout resumed with Walla Walla’s VA hospital in March and the Ohio facility in April.
After the VA launched the system in June in Roseburg and White City, Oregon, reports of patient harm pushed the department’s leaders to postpone a planned August launch at larger, more complex facilities in Western Washington. The next planned deployment is in four cities in Michigan in late January , but Remy said Wednesday those plans aren’t set in stone.
The two hearings this week followed House and Senate hearings in July during which many of the same witnesses testified about the system. But this week’s hearings were notable for their focus on the cost of the project and the VA’s poor management of such a massive contract. Sen. Patty Murray, D-Wash., did not attend Wednesday’s hearing despite being a member of both the Appropriations and VA committees.
“Electronic health record modernization was created with practically no paper trail at all,” Rep. Matt Rosendale, R-Mont., said in Tuesday’s hearing, noting that Congress has already given the VA $5.5 billion for a program that has been operating for over four years “without a reliable cost estimate.”
The VA has maintained that the total cost of the program will be roughly $16 billion over a decade, but a recent projection by the Institute for Defense Analyses estimated the project would cost $33.6 billion to implement over 13 years and a total of $50.8 billion to sustain over 28 years.
Sen. Jon Tester, a Montana Democrat who chairs the Senate VA Committee and sits on the Appropriations Committee, summed up the frustration from Congress over the program’s struggles.
“We’re into this damn near five years,” Tester said. “Truthfully, we haven’t done a damn thing. I mean, we’ve implemented, and it’s been a train wreck.”
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