VA replacement of legacy EHR systems could charge as much as $16 Billion

The Department of Veterans Affairs requires Congress to fund IT modernization of VA to keep its legacy EHR systems from failing and to replace its decades-old electronic health records system.

VA officials this month declared that they plan to replace the Veterans Health Information Systems and Technology Architecture (VistA) with the similar commercial off-the-shelf EHR from Cerner that the Department of Defense is presently implementing

“This will finally put all sufferers data in one shared system, enabling seamless care between VA and DoD without the manual and electronic exchange and reconciliation of data that we presently do in our separate systems,” VA Secretary David Shulkin, MD, testified on the day of Wednesday before a Senate appropriations subcommittee.

Although, Shulkin conceded that the department doesn’t yet currently know how much Cerner’s Millennium EHR will cost to replace VistA. As a result, he said the VA did not include a funding request for new legacy EHR systems in the department’s Fiscal Year 2018 budget.

But, Sen. Jon Tester (D-Montana) claimed the VA’s procurement of new legacy EHR systems could cost as much as $16 billion—an estimate attributed to former VA CIO Roger Baker to replace VistA. By comparison, DoD in the year of 2015 awarded a $4.3 billion contract to a Leidos-Cerner team to modernize its EHR. He asserts that the VA’s system has the potential to cost significantly more to serve its 9 million-plus beneficiaries.

While Shulkin wouldn’t comment on Tester’s $16 billion figure nor provide his own specific cost estimates, he told lawmakers that the department “will come in the FY19 budget with firm numbers so that we can have the suitable discussion about whether this is something that you can support.”

Nevertheless, Shulkin pointed out that the VA’s FY18 budget includes $200 million to “start the procedure of change management,” adding that the majority of the cost of the commercial EHR—specifically in the first two years of the procurement—is “going to be all internal change management to get ready for the installation.”