Where opportunity lies in the massive Cerner-VA EHR program

Given the Cerner-VA electronic health record program's size and complexity, analysts speaking at immixGroup's annual Government IT Sales Summit view that effort as one technology providers should pay close attention to.

The Veterans Affairs Department finalized its largest technology purchase of the year and one of the largest ever when it chose Cerner for the agency’s massive electronic health record implementation without a competition.

Cerner has brought largely the same team used for a similar EHR modernization effort at the Defense Department. The main roles see Cerner leading the VA team as prime and Leidos as a major subcontractor there, while Leidos leads the DOD program as prime with Cerner as a major subcontractor there. Accenture is on both teams as a major subcontractor.

But opportunities abound for more industry players to come on board the 10-year VA EHR program given the fact that is in early stages and its ripple effects across the entire agency enterprise, analysts said Thursday at immixGroup’s annual Government IT Sales Summit in Reston, Virginia.

Chris Wiedemann, a market intelligence consultant at immixGroup; and market intelligence senior analyst Kevin Shaker explained how the VA’s transformation of the country’s largest health care system to a commercial-off-the-shelf records solution is driving much of the agency’s year-over-year increase in IT spending given the program’s size and scope.

The VA’s IT budget for the current 2019 fiscal year comes out to $5.5 billion compared to the low-$5 billion range in the past two fiscal years, according to the presentation by Wiedemann and Shaker. And through its potential $10 billion EHR contract, Cerner’s share of the VA’s contracted IT spend “is only going to increase over the next few years,” they said.

After all as Shaker pointed out, “you really can’t talk about any modernization efforts at the VA without mentioning Cerner.”

Cerner has already become the VA’s top IT contractor for fiscal year 2018 with Leidos close behind in second given the latter’s portfolio of other modernization and systems integration work there, according to the presentation.

But just think about the VA EHR effort’s scope by itself aside from other IT programs there. The VA’s health care system has 9 million beneficiaries across more than 1,200 sites that include 170 large medical centers.

And the VA is looking for interoperability with DOD’s Genesis EHR platform, which can only add to the complexity given that envisioned linkage with another vast health care system.

And while the main players are obviously entrenched, the analysts said technology providers and resellers can look straight at the VA EHR modernization program for opportunities in a wide number of areas. Some of those could come from the Cerner team itself as they roll out the commercial EHR to more facilities, Wiedemann said.

“We’re looking for requirements in the next few years around things like large scale application or data integration,” Wiedemann said. “If you’ve got a story to tell about this kind of large scale system integration effort, there’s a pretty good chance that Cerner themselves will need your help as well as the EHR team on the VA side.”

The potential for knock-on opportunities arising out of the VA is an even larger underlying story, given how entrenched its current VistA-based EHR is across the entire health delivery enterprise. So every customer is going to be impacted by the move “often times in ways they themselves don’t know yet… change at this scale tends to create COTS opportunity,” Wiedemann said.

So where are those knock-on opportunities? Training, workflow management, business management and optimization. These are among the types of secondary requirements that arise out of a large-scale migration such as this, Wiedemann said.

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