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Has the VA/Cerner Deal Ballooned From $10B to $16B?


“We are talking about a $16 billion project that will take a very long time,” Rep. Debbie Wasserman-Schultz (D-FL) said yesterday. Previous projections had been much lower.

(Screenshot of Debbie Wasserman-Schultz from yesterday's House Committee on Appropriations meeting)

During a House Committee on Appropriations meeting yesterday, Department of Veterans’ Affairs (VA) Secretary David Shulkin, MD, defended his agency’s caution towards its electronic health records (EHR) overhaul.

The biggest news about the planned Cerner deal, however, came from the people asking the questions.

“We are talking about a $16 billion project that will take a very long time,” Rep. Debbie Wasserman-Schultz (D-FL) said in an opening statement, while simultaneously expressing an understanding of the complexity of the project and a hope that it could fundamentally “change the nation’s use of electronic records.”

Previously, most of the talk had actually been about a $10 billion project. Several earlier estimates placed the number there, and it lined up with the $1.2 billion allotted for the project in the next budgetary year. The total cost was expected to be $10 billion over 10 years.

Shulkin did not dispute the $16 billion mentioned, and it is unclear where the additional $6 billion comes from or what it represents. The Secretary did provide some detail about where the deal is being held up, however.

A review from the MITRE Corporation has been completed, Shulkin said: The agency received 51 recommendations for the contract and it is working to ensure all are incorporated in the final deal.

He added that the VA is “taking extraordinary lengths to get the expertise,” needed to get the deal right. VA Executive in Charge Carolyn Clancy, MD seemed to tell the House Committee on Veterans’ Affairs yesterday that the deal was near completion, but Shulkin said that, “We’re still looking to do a few more reviews before we say we are ready to move forward.”

The agency head doubled-down on the importance of its new open application programming interface (API) initiative. “Open APIs are the key to having free flow of information, as well as adhering to industry standards,” he said.

Wasserman-Schultz warned, however, that allowing too much customization could result in costs ballooning further. She asked that the VA maintain strong oversight mechanisms to ensure that the plan remain on track and interoperability with the Department of Defense and private sector could be achieved.

Shulkin promised a Project Management Office to oversee the process, which he said would be “clinician-led and driven.”

The hearing was the second yesterday in which the biggest news—in this case, the $16 billion number—came from those asking the questions. In the House Committee on Veterans’ Affairs hearing, Rep. Julia Brownley (D-CA) indicated that Shulkin had actually been slotted to keynote last week’s HIMSS meeting in Las Vegas to announce the VA’s finalized contract with Cerner.

Related Coverage:

The Announcement that David Shulkin Didn't Make at HIMSS

Cerner Touts Early Successes in DoD EHR Transition, but VA Deal Still in Limbo

VA Secretary Says Agency Must Replace "130" Different EHR Systems

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