VA’s $543M medical equipment tracking system delayed after facing ‘catastrophic failure’

Veterans affairs sign
A VA project designed to digitally track medical equipment was on the cusp of "catastrophic failure" after just four years.

Five years and more than a half a billion dollars after the Department of Veterans Affairs launched a project designed to digitally track medical equipment, the new IT system is facing implementation delays in the wake of widespread failures.

Initially described as “transformative” when the VA signed a $543 million contract with Hewlett-Packard Enterprise Services in 2012, the real-time locating system (RTLS) technology was designed to resolve some of the glaring issues regarding VA's inventory management. But by March 2016, the pilot project was facing “catastrophic failure," according to documents obtained by the Austin American-Statesman.

RELATED: VA hospital put patients at ‘unnecessary risk’ due to poor inventory management

Although the system was scheduled to be operational across all VA hospitals by June 2017, the project has encountered problems with high system failure rates, defective tags and even questions about whether the VA’s Wi-Fi infrastructure was adequate to manage the technology. After a stop work order was issued in 2016 and the agency renegotiated contracts with HP, VA officials told the American-Statesman the system is now slated for rollout by June 2018.

RELATED: Veterans Affairs officials highlight IT progress, but full integration is still years away

Both the VA and HP—which has since become DXC Technology—attributed the problems to growing pains that often accompany a massive technology overhaul. But the documents also validate a common criticism against VA IT system—that the amount of money invested in technology doesn’t typically pay off, and bureaucratic obstacles often stifle innovation.

But VA Secretary David Shulkin has vowed to change the perception of the VA as an inefficient innovator by investing in commercial products and getting the VA away from software development. Perhaps his biggest test will be replacing the system’s longstanding, homegrown EHR system with a commercial product from Cerner.