VA launches 10-year, $22.3 billion procurement program

As the Department of Veterans Affairs ponders whether to continue upgrading its legacy electronic health record system or to replace it outright, the VA has awarded 21 contracts worth up to $22.3 billion for information technology infrastructure improvements.

While the agency conducts a business case analysis on the future viability of its Veterans Health Information Systems and Technology Architecture (VistA) EHR system, a new multi-billion dollar indefinite-delivery, indefinite-quantity contract vehicle has been put in place to help meet the VA’s near- and longer term healthcare IT needs.

The 10-year Transformation Twenty-One Total Technology program-Next Generation (T4NG) awards include a mix of large and small business vendors, serving as a follow-on procurement to the original T4 program.

“The T4NG supports our MyVA breakthrough initiatives by assisting in the delivery of healthcare and claims processing benefiting veterans and their families,” says Greg Giddens, principal executive director of the VA Office of Acquisition, Logistics, and Construction. “The T4NG vehicle specifically supports VA’s Office of Information Technology in delivering contractor-provided IT service solutions, including technical support, program management, strategy planning, systems/software engineering, enterprise network engineering, cybersecurity, operation and maintenance, IT facilities and other solutions encompassing the entire range of IT and health IT requirements.”


Shawn McCarthy, research director for IDC Government Insights, argues that T4NG provides the IT solutions and services that the VA is seeking and is very likely to become the “go-to place” for the department’s IT procurement for the next few years.

“There seems to be pent up demand for the set of solutions they can buy here,” says McCarthy, who adds that “information technology needs often change over a period of years, and during the end year or so of any big IT contract you sometimes hear rumblings about how an agency wants something different in its next big contract.”

VA’s fiscal 2017 budget request includes $4.3 billion for IT, including investments to continue modernization of the VistA EHR, strengthen cybersecurity, improve veterans’ access to benefits, and enhance the overall technology infrastructure.

According to Giddens, there are currently no specific tasks assigned against the new contracts, but he expects that T4NG will support VA’s major initiatives similar to the T4 program, which supported a wide array of efforts such as EHR, mobile application development, wireless access in hospitals, PBX maintenance, data center operations, cybersecurity and data analytics.

As an example of its success, the VA points to T4 task orders that resulted in reducing the veterans claims backlog by more than 45 percent by transitioning from a paper-intensive claims system to an electronic automated system. In addition, as of this past February, officials say that T4 has realized cost efficiencies of approximately $743 million, which the agency estimates will be the same cost efficiencies achieved under T4NG.

However, David Blackburn, founder and CEO of G2X Health, an online community for federal health IT executives, is skeptical about both the VA’s estimates of cost savings for T4 as well as projections for T4NG. At the same time, he sees the value of the T4NG contracts for the VA to easily acquire IT services.

“The $22.3 billion is a ceiling. It’s not an amount they’ll definitely spend,” Blackburn says. “What it allows them to do is release their task orders through this vehicle and have a pool of 21 approved vendors to compete and bid for the business, which will make the process a lot faster from a procurement standpoint. Many of the vendors, especially the smaller ones, are almost exclusively focused on the VA because the payoff is so big.”

Of the 21 awardees under T4NG, 10 are to Service-Disabled Veteran Owned Small Businesses, two are classified as small businesses, and nine awards were made to large vendors, including Accenture, Booz Allen Hamilton, CACI and IBM.

Cybersecurity, in particular, is an area of IT investment at the VA that Blackburn predicts will continue to grow. While he believes the department will continue to invest heavily in EHRs given the critical importance of such systems to its mission, what ultimately happens to the VA’s VistA system remains anyone’s guess.

“Will they change course of action on VistA?” asks Blackburn. “Potientially, yes. By their own admission, they have an antiquated EHR system, and the new CIO [LaVerne Council] is not enamored with it. But, at the same time, she may be stuck with it.”

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