DoD to increase Leidos contract for Cerner EHR by nearly $1.2B

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The Department of Defense is increasing the ceiling for its electronic health record modernization contract with prime contractor Leidos by nearly $1.2 billion.

The additional funds are meant to accommodate additional services and capabilities necessary to maintain a standard EHR baseline with the Department of Veterans Affairs and U.S. Coast Guard.

DoD awarded a $4.3 billion contract to Leidos in 2015 to provide a commercial-off-the-shelf Cerner EHR system—called MHS GENESIS—to be deployed worldwide to support healthcare delivery for 9.4 million beneficiaries. However, the VA and Coast Guard subsequently decided only recently to implement the same Cerner Millennium platform.

To achieve a single, integrated EHR among the three agencies, the Defense Health Agency announced late Tuesday in a Justification and Approval document—published online in—that DoD “needs to acquire the same core capabilities as the VA is acquiring to ensure consistency among the agencies.”

According to DoD, the $10 billion EHR modernization contract that VA signed with Cerner in May will implement extended system capabilities that were not available at the time the Pentagon awarded its original contract to Leidos.

The Leidos contract modification, to be awarded without full and open competition, will allow for the ordering of all services and capabilities “necessary to maintain a standard solution baseline” with the VA and Coast Guard, according to DoD’s announcement.

“The VA will contract for and conduct its own implementation of MHS GENESIS, while the USCG will join the DoD enterprise implementation under this subject contract that is already underway,” states the document.

Last year, DoD completed deployment of MHS GENESIS to four initial operational capability sites in the Pacific Northwest. However, a report released in May from DoD’s director of operational test and evaluation found the Cerner EHR to be “neither operationally effective nor operationally suitable” based on an assessment of three of four military sites in Washington State that were part of the rollout.

Also See: DoD rollout of Cerner EHR deemed not operationally effective or suitable

Nonetheless, Stacy Cummings, program executive officer for Defense Healthcare Management Systems, said on Tuesday that the DoD continues to make progress “optimizing” MHS GENESIS at the initial operational capability sites.

Cummings said the final report from DoD’s director of operational test and evaluation is expected later this year. In the meantime, she noted that her program office is working “closely with the independent test community to identify additional areas for refinement as we complete the MHS GENESIS baseline software configuration.”

In addition, Cummings announced that four military facilities will serve as “wave 1” sites—Naval Air Station Lemoore, Travis Air Force Base, Mountain Home Air Force Base and Presidio of Monterey Army Health Clinic—and will be the first locations to “field the standard baseline as MHS GENESIS and will benefit from the results of our optimization period, as well as improvements to our training, deployment, and inter-management strategy.”

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