EHR vendor CliniComp sues government over no-bid VA contract with Cerner

The San Diego-based vendor scorned the VA for not conducting a competitive bidding process and alleged there is ample time for other EHR vendors to compete for the contract.

By Jessica Davis

August 22, 2017

03:39 PM

San Diego-based electronic health record vendor CliniComp has filed a bid protest with the U.S. Court of Federal Claims against the Department of Veterans Affairs for allegedly awarding Cerner a contract for its new EHR without conducting a competitive bidding process.

CliniComp has provided EHR systems to the U.S. Department of Defense and some VA hospitals since 2009. However, VA Secretary David Shulkin announced in June that the VA would award Cerner a sole contract to replace its legacy VistA EHR system with a Cerner EHR.

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CliniComp said it filed an agency-level protest to contest the sole source award shortly after the announcement, according to the complaint. But the VA Deputy Assistant Secretary for Acquisition denied the protest on Aug. 7. In doing so, the VA violated the Competition in Contracting Act of 1978, the company claims.

Shulkin has told Congress that the price for the EHR has not yet been negotiated. And
CliniComp alleges that this timeframe could be used to open up competition among other vendors. Competitive bidding can also reduce costs associated with an EHR implementation.

“As shown by the nine counts set forth below, the VA’s decision to award a sole-source contract to Cerner is arbitrary, capricious, an abuse of discretion and violates the CICA and Federal Acquisition Regulations,” according to the suit.

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The VA has been pressed by Congress for many years to replace its outdated system with a modernized, off-the-shelf EHR. Shulkin said in the spring the VA would make its decision about its legacy system in July -- but made the announcement a month earlier.

In making the announcement, Shulkin said the agency “does not have sufficient time to allow for full and open competition.”

CliniComp said this statement “lacks a reasonable basis.”

“In the six to eight months to negotiate a sole source contract with Cerner, the VA could hold an accelerated full and open competition for the next generation of EHR,” the company claimed.

Officials from CliniComp and the VA were not immediately available for comment.