Judge rules protestor couldn't compete for Vista replacement

The electronic health records vendor that challenged the move by Veterans Affairs Secretary David Shulkin to award a planned multibillion electronic health record contract to Cerner could not have credibly competed for the contract, a federal judge ruled.

In a recently unsealed decision, Judge Lydia Kay Griggsby of the Court of Federal Claims ruled that San Diego-based firm CliniComp lacked the experience with a contract of the size and scope of the VA's electronic health record system.

"The evidence before the Court makes clear that CliniComp has not shown that CliniComp has the kind of experience that would enable it to compete for the work contemplated by the VA’s planned contract with Cerner," Griggsby wrote.

The VA plans to use the Cerner system as a replacement for its homegrown Vista electronic health record at an estimated 1,600 facilities nationwide, reaching millions of patients. In its filings, ClinComp stated that it provides electronic health records services to 44 VA health care facilities in the U.S. and 56 Department of Defense facilities worldwide.

According to the declaration of a VA contracting officer included in the court documents, VA plans an award to Cerner to take place "sometime in November 2017, no sooner than November 9."

A VA source told FCW that a contract isn't likely to be signed for Veteran's Day, but the parties have agreed to top-line number in the neighborhood of $10 billion -- significantly less than the $16 billion - $18 billion estimates that have been reported in the press.

The contract can't be signed until a deal is reached in Congress with appropriators to get the money for the Cerner deal in the right accounts at the right time, the source explained. Shulkin has had meetings with appropriators this week to hammer out the final details.

Matthew Truex, a contracting officer with the VA's Technology Acquisition Center revealed in the Nov. 6 declaration that is part of the court record that the Cerner health record system will launch initially in the northwest U.S. at the Veterans Integrated Service Network 20, which includes sites in Oregon, Washington, Idaho and Alaska.

The first task orders on the Cerner contract are anticipated in early 2018, with a go-live date at the first sites sometime in mid-2019.

This rollout schedule matches the Department of Defense strategy, which recently wrapped up implementing initial operating capability for the Cerner electronic health record at sites in the Pacific Northwest. Most recently MHS Genesis went live at Madigan Army Medical Center in Washington state on Oct. 23.

The VA source told FCW that the plan to track DOD rollouts of the Cerner software -- to go where there are already people on the ground to install the software and train medical staff -- is a big reason why the price tag for the overall VA deal will be lower than expected.

The DOD effort, branded MHS Genesis, is being led by integrator Leidos, with Cerner as a subcontractor. On a Nov. 2 earnings call, Leidos CEO Roger Krone said once the VA closes its deal with Cerner, conversations can begin with likely subcontractors.

"We are hopeful that we will have a meaningful role in the program going forward," Krone said.

CliniComp intends to appeal Griggsby's ruling. The company is also seeking an injunction to prevent VA from making an award to Cerner while the appeal grinds on -- a move that the U.S and Cerner both oppose. CliniComp also represents that its existing contracts with VA would be in jeopardy if the Cerner deal moves forward.

While the judge ruled that CliniComp lacked standing, the language of her ruling appeared to open the door to other challenges.

"The Court notes, however, that there is less evidence in the administrative record to specifically support the Secretary’s decision to award the subject contract to Cerner," Griggsby wrote. At another point she observed, "The administrative record does not provide any other information to explain why the Secretary selected Cerner to perform this contract."

Once the contract is signed, it is subject to protest by other vendors.