VA spent $1.1 billion in five years on EHR modernization

The Veterans Affairs Department spent $1.1 billion in five years on modernizing two EHR systems, according to a new Government Accountability Office report.

The VA spent that money between 2011 and 2016 on VistA Evolution, a modernized version of its homegrown EHR, and on iEHR, an integrated system with the Defense Department. Both efforts are now nearly moot, since the VA has decided to replace its EHR with one made by Cerner, the same company that makes the Defense Department's system. The VA contract, still in the works, is estimated to be worth $10 billion for a project that will take 10 years from when the contract is signed. Cerner President Zane Burke told Modern Healthcare he expects the contract to be signed by the end of the fourth quarter.

The GAO has designated VA healthcare as "high risk" since 2015, with concerns that the VA is not effectively and efficiently using resources to give veterans "timely access" to healthcare. EHRs are "crucial for optimizing the healthcare provided to veterans," according to the GAO report.

But the agency has struggled to modernize its system. Among the EHR-related problems facing the organization is a lack of interoperability, according to the GAO. The Cerner EHR will help solve this problem, VA Secretary Dr. David Shulkin has said, since it will make sharing records with the Defense Department easier.

The Cerner EHR is the latest in the VA's continuing efforts to modernize its EHR—efforts that began in 2001, when the VA set out with its HealtheVet initiative to modernize VistA by 2018 at a cost of $11 billion. In 2010, the VA ended the project.

A year later, the VA began work on iEHR and then in 2014, on VistA Evolution. The $1.1 billion the agency spent between 2011 and 2016 went to 138 contractors—including, notably, Cerner, whose contracts were worth $6.3 million for development work on iEHR and $7.1 million for operations and maintenance of VistA Evolution.

Overall, the majority of the contracted money went to development, with about a third going to project management and under a tenth going to operations and maintenance.

The GAO has already recommended that the VA better manage its software licenses, which it started to address beginning in 2015. But, the GAO noted, the VA has not tended to its recommendation to update its CIO certification policy yet.

The GAO emphasized how important sufficient planning will be for the success of the Cerner contract. Such planning will be help the agency minimize risks, according to the report, and "guide this latest electronic health record modernization initiative to a successful outcome—one which VA, for almost two decades, has yet to achieve."