The new $4.3 billion Defense Healthcare Management System Modernization contract has been modified to make Cerner Corp. the sole data host for a remodeled military health records system.
Military officials have determined that access to proprietary Cerner data is necessary to make the new health records system work as expected, and that won’t happen if data is stored in government data centers.
The Navy office supervising a massive overhaul of the military’s electronic health records issued a “sole source modification” to the contract awarded this summer to serve 9.5 million military beneficiaries in about 1,000 locations worldwide.
The full Leidos-Cerner-Accenture partnership that won the 10-year contract still will be involved in implementation, but the Department of Defense said new records system capabilities “cannot be fully realized unless they are hosted in the Cerner environment.”
It said the new system “requires direct access to proprietary Cerner data, which is only available within Cerner-owned-and-operated data centers” rather than the originally intended government centers.
The sole-source modification is expected to cost about $5 million a year, the government estimated.
Cerner directed all questions about the contract modification to the military. No information was publicly available about whether the contract modification would affect Cerner employment or server capacity.
Government officials said it was impossible to anticipate before the contract was awarded that the new system would need full access to “quantitative models and strategies which are the result of extensive Cerner-funded research and development efforts conducted over 15 years.”
Forwarding “vast amounts” of clinical, operational and financial data to government servers would prevent access to needed Cerner models and data, and Defense officials concluded that “no other contractor can satisfy” the contract.
Health Data Management reported online on Tuesday that “some electronic health records vendors remain skeptical, questioning whether Cerner bid a compliant solution in the first place, which is why the contract now is being changed.”
Cerner responded to that report, saying, “We bid a fully compliant solution based on the request for proposals and requirements.”