Cerner wins big Veterans Affairs health records contract

Kansas City-based Cerner Corp. has been awarded the Department of Veterans Affairs contract for the VA’s next-generation electronic health records system.

The announcement Monday by VA Secretary David Shulkin said Cerner’s work on the Department of Defense’s system, now known as MHS Genesis, pushed the decision in Cerner’s favor.

Shulkin said the exact VA contract value may not be known for three to six months, but industry observers suggested it will be worth hundreds of million of dollars.

After 17 years of talking about melding the two health records systems, adoption of the same system “will ultimately result in all patient data residing in one common system,” the secretary said.

The new VA system, to replace its current VistA EHR, won’t be identical to the Defense Department’s, but its core will be Cerner’s Millennium software.

Shulkin said there was a “public interest exception” to allow awarding the Cerner contract without a “full and open competition.”

“We’re going to start, essentially, entering into the details of how we would implement a contract,” Shulkin said at a White House press conference. “We expect that process — again, trying to do this as quickly as possible — will be about three to six months at the latest. And during that time, we’re going to be developing both the implementation plans and the cost of this system, so that we can go out and make sure that we’re doing this right and that we have the resources available to do it.”

Asked at the press conference about the no-bid nature of the deal, Shulkin said that after lengthy review he believed “it is in the public interest to move quickly, and I also believe we can do this cheaper for the taxpayers by, essentially, moving forward quickly without a lengthy process.”

Separately, President Donald Trump championed taking quick action.

“The records will now be able to follow the veteran when they leave service, meaning faster, better and far better quality care,” Trump said. “This is one of the biggest wins for our veterans in decades, and I congratulate Secretary Shulkin for making this very, very important decision.”

Cerner spokesman Dan Smith said that along with the Defense Department work, the VA contract “will lead to ongoing innovation, improved interoperability and the creation of a single longitudinal health record that can facilitate the efficient exchange of data among military care facilities and the thousands of civilian health care providers where current and former service members receive health care.”

Cerner already is working on the 10-year, $4.3 billion Defense Department contract, on which it partnered with defense technology contractor Leidos, Accenture Federal Services and Intermountain Healthcare. The team beat out Cerner’s major rival, Epic, a Wisconsin-based health IT firm that also is a leading provider of electronic health records technology.

This time, however, Epic and other health IT companies weren’t offered a chance to bid. Epic spokesmen had no comment on the no-bid award as of Monday evening.

Shulkin’s statement said he was “committed to getting VA out of the software business, that I didn’t see remaining in that business as benefiting Veterans. And, because of that, we’re making a decision to move towards a commercial off-the-shelf product.”

One veterans organization, Iraq and Afghanistan Veterans of America, said it will closely watch implementation of the new system.

“Seamless electronic record-keeping has vexed the government for far too long,” said the organization’s CEO, Paulo Rieckhoff. “Time and time again, from multiple administrations, IAVA members have seen big promises on this problem that were never fulfilled. We’ve been here many times before. … But making this announcement is the easy part. The hard part is actually getting it done.”

The announcement didn’t include references to an implementation timeline for when the fully interoperable system would be working.

U.S. Rep. Phil Roe, a Tennessee Republican and chairman of the House Committee on Veterans Affairs, echoed Rieckhoff’s concern about fast and efficient implementation.

“Despite spending more than a billion dollars in hopes of achieving interoperability, VA’s antiquated IT systems have stood between veterans and the care they deserve for far too long, which is why the very first hearing I held as chairman was to assess VA’s IT landscape,” Roe said in a news release.

Shulkin said the Defense Department and the VA had been tackling interoperability issues for 17 years “at the cost of several hundred millions of dollars — in an attempt to create a consistent and accurate view of individual medical record information.”

But the bottom line was that “we still don’t have the ability to trade information seamlessly for our Veteran patients and seamlessly execute a share plan of acre with smooth handoffs,” Shulkin said. “For these reasons, I have decided that VA will adopt the same EHR system as DoD.”

Cerner employs 24,000 worldwide. The company had no immediate comment on how or whether the VA work would affect employment.

This story was originally published June 5, 2017 at 11:02 AM with the headline "Cerner wins big Veterans Affairs health records contract."