A group of House Democrats is calling for an investigation into a delayed contract between the Department of Veterans Affairs and Cerner. Meanwhile, the delay caused Cerner to revise its full-year revenue and earnings outlook given the size and scope of the pending deal.
Citing a recent Politico report that the Cerner contract is being held up by an obscure Florida doctor with access to President Donald Trump, lawmakers in the House Veterans’ Affairs Subcommittee on Oversight and Investigations and the Subcommittee on Health called for the VA Inspector General to investigate outside attempts to interfere with EHR modernization efforts.
“Simply put, updating the VA’s EHR is too important to the health and wellbeing of the 9 million veterans enrolled in VA healthcare for the process to by stymied by interference from outside political forces,” the representatives wrote (PDF) to Inspector General Michael Missal. “The process must be completely transparent and accountable, while ensuring the highest standards of patient care and responsible use of taxpayer resources.”
The letter was signed by Reps. Julia Brownley, D-Calif., Annie Kuster, D-N.H., Mark Takano, D-Calif., and J. Luis Correa, D. Calif.
The group also wrote a letter (PDF) to Acting Secretary Robert Wilkie asking for additional information about the agency’s inability to finalize the contract. The letter asked whether the VA disagreed with any of the 51 recommendations provided through MITRE Corporation’s independent assessment of Cerner, and whether any VA attorneys voiced concerns in executing a contract following Secretary David Shulkin’s departure.
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Last week, Cerner was forced to revise its expectations for the year after missing revenue expectations in the first quarter, with $1.293 billion, coupled with a drop in net earnings from $173.2 million during the first quarter last year to $160 million this year.
Cerner officials said they still expect the deal to commence, but wouldn't commit to a specific timeframe.
“We are still confident we will sign an agreement with the VA, but we are now anticipating it will be in the second half of the year and will have less impact on our results,” Cerner chief financial officer Marc Naughton said in an earnings call last week.
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Cerner dropped its year-end revenue expectations from between $5.45 billion and $5.65 billion to between $5.325 billion and $5.45 billion.
Cerner President Zane Burke added that the company continues “to believe we have broad support from key stakeholders” noting that House Appropriations Committee recently earmarked $1.2 billion in funding for the EHR modernization.
“That gives us the confidence in that," he said. “But obviously, it's been very challenging for us to predict the actual completion of that contract.”