As the Hours Count Down to a Possible DoD Mega-Announcement, Critics Express Skepticism

July 29, 2015
As news media reports indicated that the Department of Defense would announce its awarding of an EHR contract worth $10.5 billion late Wednesday afternoon, critics tell mainstream media reporters they are skeptical

As the hours count down to the awarding of what could be one of the biggest contracts in healthcare IT history, storm clouds are already gathering over whatever selection the Department of Defense makes in contracting out the development of a comprehensive electronic health record (EHR) to encompass both active military personnel who receive healthcare through the DoD’s care delivery system, and those veterans who receive care through the Veterans Administration (VA) healthcare system.

On Wednesday morning, media reports were already indicating that a formal announcement would be made of the selection at 5 PM eastern time Wednesday.

As Amy Ellis Nutt and Amy Brittain reported early Wednesday morning in The Washington Post, “The Pentagon is poised within days to award one of the most coveted health information-technology contracts in history — the first phase of a deal that could ultimately be worth more than $10.5 billion over the 18-year life of the contract. The effort, designed to provide a much-needed upgrade to the current system used by 9.5 million military personnel, including active duty and retirees, is being hotly pursued by three of the heaviest hitters in private industry: Epic Systems, Cerner and Allscripts Healthcare Solutions,” the Post’s reporters stated. And they quoted Christopher Miller, director of the DoD’s section process, as saying, “We are not just buying an off-the-shelf system; we’re really looking to modernize how the department delivers health care,” at the time that the contracted was announced as open for bid.

Nutt and Brittain also wrote this: “Skeptics, however, say choosing any of these three big commercial systems is risky. Doctors and other health-care professionals have complained that these electronic health records systems, as now configured, are clunky to use. The proprietary software means fixes and upgrades can be performed only by the manufacturer. And because none of the systems is Internet-based, sharing information between different systems can be difficult, critics say. Those complaints fuel concerns that the Pentagon will be unable to achieve one of its main goals anytime soon — building a records system that seamlessly interacts with the Veterans Health Administration.”

And the Post reporters quoted Dean Kross, M.D., a Pittsburgh cardiologist who studies healthcare IT, as saying that “None of the three finalists has been able to improve overall outcomes or reduce costs in the private sector despite a track record spanning more than a decade with complete freedom from oversight. How can anyone expect that to change now?” he asked.

Meanwhile, under the headline “Critics Warn of an $11 Billion Pentagon Health Records Fiasco,” Arthur Allen wrote Tuesday in Politico that, “As the Pentagon prepares the biggest federal IT contract announcement since, critics are warning of an even bigger fiasco, a record system that’s obsolete before it’s even finished. They say,” Allen continued, “the project to build a new electronic health record system, estimated to cost $11 billion over a decade, will bloat budgets while hurting the care of millions of service members because their doctors will be unable to smoothly and securely share their medical records across military, Veterans Administration and private health systems. The technical challenges are vast,” Allen pointed out. “The contractor will have to rewire and connect hundreds of hospitals and clinics, serving 10 million service members from the battlefields of Afghanistan to the suburbs of Washington, D.C. And because of its size and reach through the country and the world, the contract could put enormous commercial power in the hands of whichever EHR vendor wins it.”

And he reported that “Rep. Phil Roe (R-Tenn.), a physician who tracks the project, has given up trying to stop the contract, but he promises close appropriations controls. Some former Pentagon IT leaders want a one-year moratorium on the announcement, which is expected as early as this week.” Roe, a senior member of the Veterans Affairs Committee in the House of Representatives,  told Allen that  “I don’t want some other congressman to be sitting where I am 10 years from now and saying, ‘Why can’t the military and the Veterans Administration share records?’”

In his Politico story, Allen also extensively quoted Philip Newcomb, owner of the Seattle-based TSRI Corp., who had  “won over mid-level officials in both agencies with a code-converting program that allowed health records to be read within the Defense and VA systems, offering a possible way to integrate them without buying a new EHR system. His timing was bad, though,” Allen noted. “He presented the promising solution at a February 2014 meeting with officials from the two agencies. They liked it but warned him to stop calling it ‘Plan B,’ which suggested it was an alternative to the DHMSM contract that the military had announced a few months earlier. Three weeks later, the Pentagon canceled the agreement with TSRI. Newcomb believes they feared his solution would draw congressional attention and force the Pentagon to reconsider a joint venture with the VA.”

And, Allen reported, “Newcomb, who claims his system would save the agencies $56 billion over 10 years, has futilely circulated his plan in Congress since then.” He further quoted Newcomb as saying, “They’re making a horrendous mistake, in direct contradiction of what Congress had requested.”

Allen also noted in his report Tuesday that “Investors in the health IT sector also are skeptical. They anticipate that the Pentagon and whichever consortium wins the bid will have trouble agreeing on the details of the EHR implementation,” he wrote, attributing that perspective to Steve Rubis, vice president for digital healthcare at the investment research firm Stifel. “None of the three EHR vendors has had to contend with a client as complex as the Defense Department,” Allen quoted Stifel as saying.

Healthcare Informatics will keep its readers updated on this story as it unfolds.

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