VA official pledges budget shortfall related to medical record system won’t result in service cuts in Spokane

WASHINGTON – After the Department of Veterans Affairs admitted a new medical record system has upended the budget of Spokane’s VA hospital, the department’s top health official said Wednesday the issue would not result in cuts to service at Mann-Grandstaff VA Medical Center or other facilities using the system.

Undersecretary for Health Shereef Elnahal told reporters at VA headquarters in Washington, D.C., he was looking closely at the new electronic health record system’s impact on the finances of the Inland Northwest hospitals and clinics that have served as a test bed for the computer system since October 2020.

“We will make sure that those facilities get the resources they need for the vets that they’re seeing,” said Elnahal, who was confirmed by the Senate in July to lead the Veterans Health Administration, the part of the VA charged with providing health care to more than 9 million veterans.

In written responses to questions from The Spokesman-Review on Monday, VA Press Secretary Terrence Hayes said the system – developed by Cerner Corp. under a $10 billion contract to replace the department’s existing system – has increased the cost of care provided in VA facilities that have adopted it. Meanwhile, he confirmed, slowdowns caused by the new system have reduced the facilities’ capacity to treat patients and forced the VA to send more veterans to outside hospitals, resulting in additional costs.

The tech giant Oracle acquired Cerner in a $28.3 billion deal that closed in June, and the company is now known as Oracle Cerner. Hayes said the Veterans Health Administration is working with the company to resolve problems with its system.

In addition, Hayes said, the system is “not equipped” to correctly bill patients and insurance companies, “causing a significant reduction in overall collections” at the four Northwest VA medical centers where it has been deployed – in Spokane, Walla Walla and Roseburg and White City, Oregon.

The only site outside of the Northwest using the system is in Columbus, Ohio, where it launched in April. Elnahal visited the Columbus hospital Sept. 9 and on Wednesday said employees there told him of “increased stress” and “difficulty with the system as it is currently configured.”

“The system should ultimately be something that enables better care, and be intuitive, and we’re not there yet with this system,” Elnahal said. “It has to improve.”

Hayes said the Veterans Health Administration has provided additional funding to the regional division that covers Washington, Oregon, Alaska and parts of Idaho and Montana, “ensuring that they are funded as required for the lost productivity and the associated budget shortfalls that have been identified to VHA’s Office of Finance.” He said no facility in the region has been directed to reduce its staffing level as a result of the budget problems.

In July, Reps. Cathy McMorris Rodgers of Spokane and Dan Newhouse of Sunnyside, along with two of their fellow Republicans from Ohio, sent a letter to VA Deputy Secretary Donald Remy asking that the VA create a dedicated fund for additional staffing at hospitals and clinics using the new system.

“The medical centers in our districts should not have to choose between staffing up to continue safely caring for veterans and blowing a hole in their budgets, forcing painful cuts in the future,” they wrote.

“Whatever is ultimately decided about the fate of the program, our medical centers cannot be left behind,” the lawmakers added. “They have been forced onto a deeply flawed system, and they are struggling to address the needs of the veterans in our communities.”

Hayes said that while the VA’s budget does not currently include the “staff augmentation fund” requested by the lawmakers, the office in charge of rolling out the new system is collaborating with other parts of the VA “to provide additional resources such as more training, at-the-elbow support and virtual clinical resources as necessary for successful deployment.”

Congress has already appropriated money for additional staff for “deployment and implementation activities,” Hayes said. That approach assumes a hospital will serve fewer patients while employees learn to use a new medical record system, something Elnahal said is normal.

“However, it shouldn’t decrease permanently,” he said. “There should be a restoration of productivity over time.”

In March, Remy told The Spokesman-Review he expected productivity at the VA hospital in Walla Walla to return to normal within three months of launch. Six months later, Hayes said the Wainwright Memorial VA Medical Center “has not returned to pre-deployment productivity.”

At that same time, Remy said productivity at Mann-Grandstaff had already returned to normal, pre-Cerner levels. But on Monday, Hayes said productivity “is increasing month-over-month and returning to pre-deployment levels,” adding that because the Oracle Cerner system measures workload differently, “exact comparisons before and after the implementation are difficult.”

After a planned August launch of the Oracle Cerner system in Western Washington was delayed, no additional deployments are planned until 2023, and VA leaders have said they will not roll the system out at other facilities until they fix problems that risk patient safety. In the meantime, the system continues to be used throughout the Inland Northwest, in southern Oregon and in central Ohio.