VA underestimated infrastructure prices that would increase EHR price ticket by as much as $5B: OIG

The full price of the Veterans Affairs Division’s new medical information system could possibly be $2.5 billion to $5.1 billion increased than at present estimated, based on two inspector normal reviews.

The VA’s business digital well being information venture was initially pegged at $10 billion then raised as much as $16.1 billion, together with $4.3 billion for info expertise infrastructure upgrades. 

However the VA did not account for hundreds of thousands in IT and bodily infrastructure wants, based on reviews from the VA Workplace of Inspector Basic (OIG). The OIG discovered that the estimate of about $4.3 billion was not dependable, and, as one other drawback, an absence of full documentation made it troublesome to find out the accuracy of estimates, the report issued final week mentioned.

The VA additionally didn’t report back to Congress different, important program-related IT infrastructure improve prices totaling about $2.5 billion, thus underreporting this system life-cycle prices by a major quantity, based on the inspector normal.

The report checked out price estimates for IT infrastructure—together with system interfaces and end-user units like desktops and laptops—utilizing documentation maintained by the Workplace of the Digital Well being File Modernization, or OEHRM. That central workplace manages the EHR system rollout at VA and the brand new EHR program on the Protection Division, MHS Genesis.

RELATED: First VA medical middle (lastly) goes reside on Cerner EHR as a part of $16B venture

The watchdog issued a report earlier this yr that discovered price estimates for bodily infrastructure work associated to the EHR venture—reminiscent of heating, air flow and cooling, electrical work and cabling—had been underreported by $1 billion to $2.6 billion.

The VA signed a $10 billion deal with Cerner in Could 2018 to maneuver from the VA’s personalized VistA platform to an off-the-shelf EHR to align the nation’s largest well being system with the Division of Protection (DOD), which has already began integrating Cerner’s MHS Genesis system.

For the VA, the Cerner EHR will change the roughly 130 operational situations of VistA at present in use throughout the division. Whereas the preliminary EHR contract signed with Cerner was for $10 billion, the VA has pushed the estimated 10-year price for implementing the system previous $16 billion.

Mann-Grandstaff VA Medical Middle in Spokane, Washington, went reside with the brand new Cerner EHR system in October 2020, the primary website as a part of VA’s large medical information venture.

It is a expertise venture that is been suffering from delays, management turnover, and infrastructure issues because it kicked off in 2018.

The OIG audit group evaluated two estimates OEHRM supplied to Congress dated December 2018 and August 2020—every for about $4.3 billion.

RELATED: Federal watchdog says VA’s March EHR go-live date was ‘unrealistic’

“Neither of the estimates totally met the traits of being well-documented, complete, and credible,” the OIG wrote relating to the IT infrastructure estimates.

The OIG discovered there’s an elevated threat of inadequate funding to finish the upgrades as a result of OEHRM lacks formal agreements with VA’s Workplace of Info and Expertise (OIT) and the Veterans Well being Administration (VHA) to commit these entities to funding the $2.5 billion in upgrades OEHRM expects them to contribute.

“By not together with the anticipated prices of some IT infrastructure upgrades essential to deploy and maintain the brand new system in congressionally mandated reviews, OEHRM has underreported the EHRM program’s complete price by about $2.5 billion, or 15%. This can be a good portion of one of many program’s three essential price elements,” the OIG wrote.

The watchdog famous that there’s appreciable threat {that a} program might expertise price overruns when preliminary estimates are unrealistic.

The IG really useful an unbiased price evaluation, formalize agreements with OIT and VHA to determine the anticipated funding contributions from every entity and set up procedures that determine when lifecycle price estimates needs to be up to date and guarantee these updates are disclosed in this system’s congressionally mandated reviews.

OEHRM officers agreed with all six suggestions and supplied motion plans. 

RELATED: Lawmakers irked at lack of transparency from VA after Cerner EHR venture delay

In preparation for deploying the Cerner EHR, VA medical services want vital upgrades to their bodily infrastructure, reminiscent of electrical work, cabling, heating, air flow, and cooling. These upgrades are important to the profitable deployment of the brand new system and are more likely to price billions of {dollars}, the IG wrote within the Could report.

VHA workers instructed the IG that it was not till November 2018, almost six months after Cerner signed the EHR, that key VHA workers had been first made conscious of a necessity for bodily infrastructure upgrades. The IG famous that the first time VA publicly introduced the vital price related to the EHRM program was in a February 2020 listening to, shut to 2 years after the contract with Cerner was signed.

“Nonetheless, not one of the eight quarterly reviews submitted by [the Office of Electronic Health Record Modernization] as of January 2021 included bodily infrastructure prices in this system’s life cycle price estimate, regardless of all however certainly one of them containing language indicating that bodily infrastructure prices had been included. Actually, the one infrastructure prices the life cycle price estimate included had been associated to info expertise infrastructure,” the report mentioned.

The IG warned that present estimates for bodily infrastructure prices are probably far too low, as a result of, partly, the estimates had been based mostly on VA’s first services to implement the brand new system, which had been discovered to be considerably decrease than precise wants dictated.

The VA IG made 5 suggestions, all of which had been accepted by VA management.

The IG additionally not too long ago launched a report coaching deficiencies with VA’s EHR on the Mann-Grandstaff VA Medical Middle in Spokane.

The Home Veterans Affairs Committee plans to maintain hearings on the 2 infrastructure reviews and the progress on the EHR venture within the coming weeks.

“It’s clear from these reviews that the associated fee estimate for VA’s EHRM venture was vastly underestimated by the earlier administration and that there are vital failures with the present workers coaching program,” mentioned Chairman Takano. “I admire the work of the Inspector Basic in figuring out these points, and I’m grateful that VA has acknowledged them and plans to supply our Committee higher transparency.”