# VA Oracle EHR Modernization Contract The [[Department of Veterans Affairs]]' Electronic Health Record Modernization (EHRM) program — a 2018 sole-source contract to replace the VA's homegrown VistA records system with Cerner's commercial platform — is the largest civilian IT program in the federal government and, by the government's own 2026 numbers, one of its worst-performing. Awarded at **$10 billion over ten years**, the contract was modified on **August 18, 2026** to add roughly **$17 billion** and three option years, lifting the ceiling to just under **$27 billion** and the completion date to **May 2031**. Fewer than a tenth of the VA's 164 medical centers were running the system when the modification was signed. On September 2, 2026 the [[House Veterans' Affairs Committee]] voted 19–0 to subpoena [[Oracle Corporation]] chairman [[Larry Ellison]] and co-CEO [[Mike Sicilia]] after Oracle accepted, then withdrew from, an invitation to testify. > [!info] Not the $7B deal > A separate 10-year Pentagon enterprise software-licensing agreement with Oracle, worth up to ~$7B and announced July 23, 2026, is a different contract. Coverage of the two deals within a month of each other has led to the figures being conflated. --- ## Timeline | Date | Event | |---|---| | May 2018 | VA awards Cerner a 10-year, ~$10B sole-source contract under Secretary [[David Shulkin]] (first Trump administration), following the Defense Department's choice of Cerner for its own MHS GENESIS system. | | Oct 2020 | First go-live at Mann-Grandstaff VA Medical Center, Spokane, plus clinics in Coeur d'Alene, Wenatchee, Sandpoint and Libby, Montana. | | 2022 | Further deployments at Walla Walla, southern Oregon and central Ohio. Oracle completes its ~$28B acquisition of Cerner (June 2022), inheriting the contract; Sicilia tells the Senate in July 2022 that Oracle will fix the system's problems "at our expense." The Institute for Defense Analyses estimates lifecycle cost at $49.8B ($32.7B implementation + $17.1B sustainment). | | 2023 | VA pauses new deployments after patient-safety failures; the Spokesman-Review's reporting ties the system to thousands of patient-harm cases, ten classed as catastrophic. | | 2024 | Deployment at the joint VA–DoD Lovell Federal Health Care Center in Illinois. | | Feb 2025 | [[Doug Collins]] confirmed VA Secretary; restarts and accelerates the rollout. | | Apr 2026 | Largest single wave to date: four Michigan hospitals. | | Jun 2026 | Four hospitals in Ohio and Kentucky. | | Aug 12, 2026 | FedScoop obtains the VA's justification document: the ceiling would be exhausted by Q1 FY2027; 14 sites live, 36 scheduled through Jan 2028, 120 impossible under existing terms; the VA re-justifies sole-source after evaluating Epic, Meditech, Athenahealth and Veradigm. | | Aug 18, 2026 | Modification awarded: ~$16.9B added, three option years, ceiling ~$27B, end date May 16, 2031. | | Aug 26–27, 2026 | Oracle accepts a hearing invitation, then withdraws it the next day citing "timing constraints." | | Sept 2, 2026 | House Veterans' Affairs Committee hearing; committee votes 19–0 (all 11 Democrats plus 8 of 14 Republicans; six Republicans not voting) on [[Maxine Dexter]]'s motion to subpoena Ellison and Sicilia. | | Sept 15, 2026 | Subpoenas served. Return dates: Sicilia November 19, Ellison December 10. | | Sept 24, 2026 | Bloomberg Government reports Sicilia has agreed to appear in November; committee says discussions about Ellison's appearance are ongoing. | ## What the VA said at the hearing Deputy Secretary Paul Lawrence told the committee the full lifecycle cost would be roughly **$48 billion** — about $37B for deployment plus $11B for sustainment — and acknowledged the estimate was not independent. (Nextgov reported a VA figure closer to $56B including $19B+ for ten-year sustainment; the two figures have not been reconciled publicly.) Lawrence could not explain what drives the $17B increase, would not disclose Oracle's original proposal amount, and said he was "very confident" no further funding requests would be needed: "We have spent exactly the money you have allowed us. We have deployed in the schedule exactly as we said we would." GAO's Carol Harris testified that of 18 GAO recommendations on the program, 14 remained not fully implemented, and that the VA had produced no updated cost estimate or detailed schedule. GAO also flagged that legacy VistA maintenance, estimated at $2B over two fiscal years, could only be verified to about $1B. Committee chairman [[Mike Bost]] (R-Ill.): "This has been the biggest boondoggle I've seen." Ranking member [[Mark Takano]] (D-Calif.), after the subpoenas were served: Ellison and Sicilia "must answer under oath for what veterans will receive in exchange for a contract ceiling tripled behind closed doors." ## Why it matters for the KB - **Sole-source lock-in.** The 2018 award skipped competition on the theory that matching DoD's Cerner system justified it; the 2026 justification skips competition again on the theory that switching vendors now would delay care. Each stage of failure becomes the argument for the next extension — the platform-lock-in dynamic the KB tracks in [[Palantir $10B Army Contract]] and [[Anduril $20B Army Contract]], here in its civilian form. - **Donor-contractor oversight test.** Ellison is among the largest Trump-aligned donors and sits on PCAST; his family stack spans federal cloud, TikTok US and CBS ([[Ellison Family]]). The subpoena passed with a Republican chairman's support and eight Republican votes — a rare instance of GOP committee oversight landing on a top administration ally's company. Whether the November–December hearings produce anything beyond testimony is the open question. - **Acceleration under Collins.** The 2025 restart and the 2026 deployment surge preceded the ceiling breach; the VA's own press office framed the pace ("more than doubled the number of VA medical centers" on the system between April and June 2026) as an achievement weeks before the $17B modification became public. - **The privatization frame.** The VA page's central contest is care privatization; the EHR program is the IT analogue — a public system (VistA, built in-house over decades) replaced by a commercial vendor's platform at a cost that now exceeds several years of Community Care spending. ## See Also - [[Oracle Corporation]] · [[Oracle Health]] · [[Larry Ellison]] · [[Mike Sicilia]] - [[Department of Veterans Affairs]] · [[Doug Collins]] · [[David Shulkin]] - [[House Veterans' Affairs Committee]] · [[Mike Bost]] · [[Mark Takano]] · [[Maxine Dexter]] - [[Government Accountability Office]] - [[Ellison Family]] — the dynasty's regulatory-favor dependency