Investigation Finds VA/DoD Wasted $1.3 Billion on Cancelled EHR System

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The Department of Veterans Affairs and the Department of Defense (VA/DoD) spent at least $1.3 billion during the last four years trying unsuccessfully to develop a single “integrated” and “interoperable” EHR system between the two departments — leaving veterans’ disability claims to continue piling up in paper files across the country, a News21 investigation shows.

The investigation does not include the billions of dollars spent during the past thirty years including the $2 billion spent on a failed upgrade to the DoD’s existing EHR system.

In an email statement to News21, Sen. Patty Murray, D-Wash., a member of the Committee on Veterans’ Affairs expressed her concerns about the future of EHRs shared between the DOD and VA.

“While it is not easy to get the government’s two largest bureaucracies to work together efficiently, I have been very troubled about the effort to develop systems to allow communication between VA and DOD’s medical records. I am especially concerned DOD spent hundreds of millions of tax dollars — and thousands of staff hours over the last few years — trying to create an integrated IT platform with the VA only to announce they were unable to come to a solution.”


Back in 2008, the  National Defense Authorization Act for 2008 mandated that the DOD and VA develop and implement a EHR system that will allow for complete interopability between the Department of Defense and the Department of Veterans Affairs. However, after two years and more than $1 billion spent on a single, joint EHR system, the project was cancelled to focus on upgrading their existing EHR systems that would allow the two systems to share personal health information.

According to data gathered by News21, the VA began paying companies for the project in July 2011, at the same time money was still being spent by both the DOD and VA on the single, joint EHR system. Prior to the cancellation of the joint EHR system project, the VA awarded Harris Corp a multiyear contract worth $80.3 million to create interoperable software for the two department systems to communicate.

Future Plans/Upgrades

The VA plans to invest $12 billion over five years a on project called Transformation Twenty-One Total Technology, or T4 to upgrade its own technologies including upgrades to interoperable software that can be used between the VA and DOD, according to News21 investigation.

The 2014 DOD budget requests $466.9 million for “initial outfitting” and “replacement and modernization” of its current health care record.

Other key findings of the investigation include:

  • For a disability claim to be processed in 125 days, a goal outlined in a Jan. 25 VA report, the files must be electronic, which means all paper records must be scanned into the system.
  • The VA scanning system — Veterans Benefits Management System (VBMS) — cost $480 million between 2009 and 2012. As of early July, only about 30 percent of paper claims had been scanned — that’s 165 million pieces of paper, according to the VA.
  • In 2012, the average time a claim waited for evidence to be processed — which includes those health and service records from DOD as well as physical exams — was 206.7 days, according to Veterans Benefits Administration documents. Gathering evidence is the longest part of the claims process.
  • The VA did not say how it receives records from the DOD.

Featured image credit: photosteve101 via cc

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