VA looking to renegotiate its $10B contract with Oracle Cerner

The Department of Veterans Affairs is trying to negotiate a five-year option period for its $10 billion contract with Oracle Cerner as the EHR modernization program has been troubled since its rollout in 2020, FCW reported March 16. 

At a Senate Veterans Affairs Committee hearing on March 15, U.S. Sen. Jon Tester, D-Mont., chairman of the Senate Veterans Affairs Committee, said he wants to see the VA negotiate "tougher" terms and "severe penalties for poor performance," with Oracle Cerner. 

"If Oracle won't agree to those terms, then the VA should be prepared to renegotiate an entirely new contract or find a different team of partners," said Mr. Tester. 

Michael Parrish, chief acquisitions officer of the VA told lawmakers at the hearing that it would be renegotiating with the Oracle team to strengthen and add more enforcement mechanisms, specifically around service level agreement.

VA contracted with Cerner on a sole-source basis in 2018.

This comes after the VA confirmed that the Oracle Cerner EHR system caused six incidents of "catastrophic harm" to veterans, with four of those incidents leading to the death of patients. 

There are currently two proposed bills aimed at scrapping the entire VA modernization program.

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