VA not sharing details on supply chain upgrade, Republican lawmaker says

The Department of Veterans Affairs has launched an ambitious effort to modernize its medical supply chain system but has provided lawmakers with few details about the project’s cost or execution, a top Republican warned on Tuesday. 

During a hearing of the House Veterans' Affairs Committee's Subcommittee on Technology Modernization, Rosendale said he agreed that the department needs to modernize its systems but cautioned that “there is very little detail about how it may be accomplished.”

“The supply chain modernization project is a gigantic effort the likes of which we have only seen with the EHR, and we know how that has turned out,” Rosendale said, referring to VA’s beleaguered rollout of a commercial electronic health record system that has been plagued by usability issues and resulted in the department instituting a pause on new deployments of the software last year. 

Rosendale said the department has only provided Congress with “a rough idea of what the project may entail,” despite the fact that a contract award for the new system is reportedly close to being announced. And he warned that “there does not seem to be any approved budget” for the project, which he called “stratospheric.” 

After pressing the agency for almost a year to report the project’s cost, schedule and objectives to Congress, Rosendale said VA submitted the requested information to his office 24 hours before the hearing, which estimated the initiative’s lifecycle cost to be between $9 billion and $15 billion.

The department previously began looking at using the Pentagon’s supply chain management system in 2018 to upgrade its legacy systems, but announced in December 2022 that it would not deploy the DOD logistics system following concerns from agency watchdogs and lawmakers over its effectiveness.

Since then, VA has pursued its own supply chain modernization project, which included requesting proposals from outside contractors in June 2023 to undertake the effort.

The department currently has 63 different supply chain systems spread across 171 different sites, which has caused problems for clinicians and other providers who need timely access to medical supplies and other resources. Contracting documents indicate VA is looking to create "an advanced, integrated system of systems that provides responsive, efficient clinical/non-clinical supply support.” 

Rosendale said that VA seems to be rushing forward without a plan in place, warning that “the government will be paying a contractor in order to find out what the government will be buying from that company.”

Sheila Cherfilus-McCormick, D-Fla. — the panel’s ranking member — echoed Rosendale’s concerns, saying that patients and providers deserve a modernized supply chain but that “it has yet to be proven that VA has the capacity to provide this solution.”

VA Chief Acquisition Officer Michael Parrish provided the panel with some additional details about the modernization project, including outlining its broader objectives and the component agencies tasked with overseeing the initiative. He also said VA’s approach to the project has been guided by input from agency watchdogs and industry providers to maximize the system’s effectiveness and limit its cost.

“This has been, and will continue to be, a deliberate, field-driven iterative process, in that the project has to complete multiple milestones before we fully commit to spending taxpayer dollars in deploying the expected enterprise solution,” Parrish said. “This effort has been ongoing for several years now, which is necessary to get the hard decisions right before we commit taxpayer dollars.”

Rosendale said, however, that VA has failed thus far to be transparent with Congress about the project and the cost of its deployment. 

“You have not come forward and presented a reasonable plan that we can sit down and have a conversation to try and help the VA, and that’s where this committee gets very upset,” he said.