VA underestimated EHR project costs by $ 2.5 billion, OIG says

According to the findings of the Department’s Office of the Inspector General, the Department of Veterans Affairs has exceeded cost estimates by several billion dollars for overhauling its electronic health records.

Auditors identified “weaknesses” in the way the VA designed its cost estimates for the project, which led the ministry to erroneously price $ 2.5 billion, according to the. report, which the inspector general published on Wednesday.

Three years ago, the VA reported to Congress that the 10-year system-wide implementation of a new EHR system from Cerner Corp. would cost around $ 16.1 billion, including $ 4.3 billion to pay for upgrades to the department’s IT infrastructure. The Office of the Inspector General, however, found that VA did not represent $ 2.5 billion in other necessary technological improvements. The VA “assumed” the money would come from other parts of the department, according to the report.

The VA Office of EHR Modernization believed that these costs were beyond what the department is required to report to Congress and that the funds would come from the budgets of the VA Office of Information and Technology (OIT) and the Veterans Health Administration (VHA) officials told listeners. The VA is preparing to restart its EHR deployment in the coming weeks after completing a strategic review of the project in June.

The Inspector General’s report, however, specifies that the VA must report all related costs to lawmakers, regardless of the source of funding.

The VA may not have enough money to cover those $ 2.5 billion in expenses, according to the OIG. The EHR Modernization Office does not have formal agreements with the ILO and VHA that would facilitate these divisions to help fund the EHR project, the report said.

“While it is generally understood that the ILO and the VHA will pay for some IT infrastructure upgrades necessary to deploy and maintain the new electronic health record system, establishing formal agreements would help to clarify who will fund the upgrades, ”the inspector general said.

The Office of EHR Modernization also did not present additional updates of its infrastructure costs to Congress as it identified them and the VA did not have full documentation on how it reached the figure. $ 4.3 billion, which made it difficult to determine the accuracy of the estimate. is, says the report.

Since January, the EHR Modernization Office has developed new procedures for its staff that align with the Government Accountability Office’s cost estimation guidelines and made improvements to its cost models, which will likely improve the reliability of future projections, according to the report. .

The report’s findings mirror an OIG report released in May that found that the VA may not have budgeted enough money for necessary physical infrastructure upgrades.

House lawmakers raised concerns about the findings of the latest report on Thursday and announced a July 21 hearing on recent OIG reports and VA’s progress on the EHR initiative.

“I continue to have serious concerns regarding the management of the EHRM program, including the lack of clarity regarding life cycle costs, failures in staff training and inadequate change management practices,” Representative Frank Mrvan (D-Ind.), Who chairs a subcommittee overseeing VA technology, said in a Press release.

In a separate report this week, the OIG discovered “significant” issues with the EHR training provided to clinical and administrative staff at Mann-Grandstaff VA Medical Center in Spokane, Wash., which was the first site to put the new EHR system into service. last year. Gaps included a lack of training for staff who use the system in their day-to-day work and a lack of time to cover complex topics.

Fifty-five percent of hospital staff said they were unable to document patient care in the new EHR without difficulty and 65% said they were unable to navigate without difficulty in the different applications of the new EHR, according to an OIG survey. administered two to three months after the implementation of the new records system by the VA.

The VA halted the deployment of the EHR to conduct a “strategic review” of the project in March following an assessment conducted during the first month in office of VA secretary Denis McDonough.

The department is committed to the new EHR, which is designed to more easily share data with the Department of Defense military health system, but may adjust the timing of future deployments, McDonough said at the time.

The VA is not in a position to comment on the draft EHR until officials have testified to the strategic review at a Senate veterans committee next Wednesday, department spokeswoman Melissa Bryant said.

“VA takes very seriously the findings of this and other OIG reports regarding the challenges of deploying our electronic health record,” she wrote in an emailed statement.

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