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VA’s sole-source authority
There’s no doubt the department had the authority to award a sole-source EHR contract to Cerner. The next big question is: What about the integrators?
BY NICK WAKEMAN
One of the common questions I’ve heard since the Department of Veter- ans Affairs announced it was award- ing a sole-source contract to Cerner to supply an electronic health record sys- tem is whether VA can actually do that. After all, it would be a no-competition contract worth billions of dollars.
The short answer is yes, VA has the authority, and it lies in a provision of the Competition in Contracting Act.
The regulations implementing the law cite several exemptions from competition. The VA decision seems to fall primarily in the seventh and last exemption: public interest.
VA Secretary David Shulkin said as much when he talked about the criti- cal need for veterans to have an EHR that is compatible with the system the Defense Department is building using Cerner’s products and Leidos’ integra- tion skills.
However, just because VA has the authority, the decision is not auto- matically bulletproof. A company like Epic, a competing EHR firm, could have filed a protest with the Government Accountability Office, but that was always a long shot. GAO has heard only two protests involving that kind of exemption from competition.
The one closest to the VA/Cerner decision involved the purchase of Russian helicopters for the Afghan Air Force in 2010. Sikorsky filed a protest,
arguing that the U.S. Navy had improp- erly limited the competition. The Navy said it was in the public interest to go with the Russian helicopters because the Afghan Air Force had been flying and maintaining such aircraft since the 1980s, and officials claimed it would take three years to retrain everyone to use a different helicopter.
GAO sided with the Navy and denied the protest.
Just because VA has the authority, the decision is not automatically bulletproof.
In the second case, the Air Force signed a sole-source contract for food services using the public interest justi- fication, but this time GAO sided with the protestor. However, the Air Force declined GAO’s recommendation to compete the work.
Given that DOD has already picked Cerner and the government has a long- time goal of creating an integrated health record that can follow individu- als from active military service into the VA system, the chances of convincing GAO to reject the public interest argu-
ment would have been slim. And with the 10-day window for filing protests now closed, the question will remain academic.
So VA can now move forward, and the scale of the project is massive — even compared to DOD’s $4.3 billion project with Cerner and Leidos. One estimate, reported by FCW, put the value at $16 billion.
The next question is how or even whether Leidos will be part of the VA project. Cerner was the only firm named in the announcement of the sole-source deal. Shulkin said in June that VA expects to strike a deal with Cerner in the next four months and after that “will be looking for help from...an integrator through separate procurement.”
A statement from Cerner simply said the company will build a “team of innovative and experienced partners” to work on the VA project.
Leidos CEO Roger Krone said at an investor conference in June that “this is frankly faster than we would have expected VA to move,” but he sees a role for the company to help VA with the integration.
So will Leidos or another company be Cerner’s partner? And how will VA or Cerner make that choice? Stay tuned. n
Nick Wakeman is editor-in-chief of Washington Technology.
WashingtonTechnology, a sister publication to FCW, covers all the ins and outs of the IT contracting community. Learn more at WashingtonTechnology.com.
34 July 2017 FCW.COM