Lawmakers want VA to nail down total EHR modernization cost

The Department of Veterans Affairs needs to figure out the cost of its troubled electronic health record modernization program as it moves to restart deployments of the new software, lawmakers and witnesses warned during a House hearing on Monday. 

VA initially signed a $10 billion contract — which was later revised to over $16 billion — with Cerner in May 2018 to modernize its legacy health record system and make it interoperable with the Pentagon’s new health record, which was also provided by Cerner. Oracle later acquired Cerner in 2022.

Almost as soon as the new EHR system went live in 2020 at the Mann-Grandstaff VA Medical Center in Spokane, Washington, however, the modernization project was beset by a host of problems, including cost overruns, patient safety concerns and technical glitches. VA subsequently paused deployments of the EHR system in April 2023 as part of a “reset” to address problems at the facilities where the software had been deployed. 

Following the successful joint VA-DOD rollout of the EHR software at the Captain James A. Lovell Federal Health Care Center in North Chicago, Illinois last March — the sixth facility to use the new system — and citing significant improvements at the other sites using the Oracle Cerner EHR, VA announced in December that it was “beginning early-stage planning” to restart deployments in mid-2026.

Even as VA looks to implement the Oracle Cerner EHR system at four of its Michigan-based medical facilities in 2026, members of the House Veterans’ Affairs Technology Modernization Subcommittee pressed the department on Monday to pin down the long-term costs and time commitments needed to complete the modernization project. 

Rep. Tom Barrett, R-Mich., the panel’s chairman, said he was not convinced VA has fixed all of the EHR program’s problems during its reset period and noted that — despite the fact VA is 7 years into the original 10-year contract for the project — “Congress has not received a schedule nor an up-to-date cost estimate to evaluate this program’s current state.”

Cost estimates for the entirety of the project have varied, with GAO Information Technology and Cybersecurity Director Carol Harris noting that these have ranged from $16.1 billion to an independent analysis that pegged the project’s total cost at almost $50 billion. 

“While the latter is more realistic, neither reflects the many changes and delays to the program,” Harris said. 

Seema Verma, Oracle Health’s executive vice president, said that an accelerated deployment of the new system — bolstered by progress made during the reset phase — would help drive down the project’s total cost and said that the company did not agree with the $50 billion figure cited by Harris. 

The department and Oracle Cerner previously renegotiated their existing contract in May 2023 to include more accountability provisions in the agreement and to change the terms of the remaining contract from a 5-year term to five 1-year terms. 

With the current contract slated to fully expire in May 2028, and VA still needing to deploy the new software to more than 160 other VA medical facilities, Neil Evans — acting program executive director of VA’s Electronic Health Record Modernization Integration Office — said the project would not be completed by that time. 

To get a better understanding of the full scope of the modernization project, acting VA Inspector General David Case said the department “must develop and maintain an integrated master schedule to clearly track and project the program's cost to completion.” 

Evans told the lawmakers that the department is committed to developing a detailed integrated master schedule and updated life cycle cost estimate to help guide the modernization project’s path forward.

“We recognize the importance of providing this information to inform decisionmaking and ensure the success of future deployments,” he said.