VA faces lawsuit over Cerner health record plan

EDITOR'S NOTE: This article first appeared on 

When Veterans Affairs chief David Shulkin announced plans to move the agency off its homegrown electronic health records system Vista to the commercial product from Cerner currently being deployed by the Defense Department, there was near unanimous approval from Congress and veterans groups, which had long complained about the inability of DOD and VA systems to work together. The announcement even rated at hat-tip from President Donald Trump.

But not everyone is cheering.

In a lawsuit filed Aug. 18, electronic health records vendor CliniComp, which does business with VA and DOD, is suing for injunctive relief to prevent the VA from issuing a contract to Cerner. The news was first reported in Modern Healthcare.

CliniComp filed an agency protest on June 14 complaining about the move to sole source the potentially multibillion dollar contract with Cerner. That protest was rejected in an Aug. 7 letter from the VA's deputy assistant secretary for acquisition and logistics.

The complaint alleges that Shuklin's decision to select Cerner without a competition using the "public interest" exception to federal contracting rules doesn't stand up and that Shulkin's public statements about an urgent need to shift to a new system reflects poor planning on the part of VA. The complaint states that the choice of Cerner was "arbitrary, capricious and an abuse of discretion."

In the determination and findings document obtained by publication Washington Technology via a Freedom of Information Act request, Shulkin asserts that continuing with Vista or going with another commercial provider aren't in the public interest.

"Continuing to modernize VistA or selecting a different commercial EHR other than the DoD EHR system, with a single shared record, will result in VA having to develop and maintain an increasingly complex technical architecture without providing seamless care," Shulkin wrote.

Shulkin also noted that VA was represented in the two-year procurement that resulted in the DOD's acquisition of the Cerner Millennial system by two non-voting advisers. He also indicated that the VA will benefit from contracting directly with Cerner rather than have an integrator act as prime contractor -- the role Leidos currently fills in the DOD contract awarded in 2015.

"This direct relationship with Cerner will also enable VA to accelerate the development and implementation of seamless health care for the nation's Veterans and likely hasten the adoption of national standards for EHR systems," Shulkin wrote.

The also-rans in the DOD acquisition, most notably electronic health record market leader Epic, apparently haven't filed protests or sued about the VA's sole source plan.

Cerner has joined the case as a defendant. A U.S Court of Federal Claims judge scheduled oral arguments for Oct. 2, and filings in the case are expected throughout September.

It's not clear if the lawsuit will delay the timetable for making an award to Cerner. A VA spokesperson told FCW that the agency does not comment on contract negotiations.

Cerner president Zane Burke told investors on a July 27 earnings call that he expected to sign a contract with VA before the end of 2017.

About the Author

Adam Mazmanian is executive editor of FCW.

Before joining the editing team, Mazmanian was an FCW staff writer covering Congress, government-wide technology policy and the Department of Veterans Affairs. Prior to joining FCW, Mazmanian was technology correspondent for National Journal and served in a variety of editorial roles at B2B news service SmartBrief. Mazmanian has contributed reviews and articles to the Washington Post, the Washington City Paper, Newsday, New York Press, Architect Magazine and other publications.

Click here for previous articles by Mazmanian. Connect with him on Twitter at @thisismaz.

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