Lawmakers are turning directly to Oracle for answers about why the Department of Veterans Affairs increased the ceiling on its electronic health record modernization contract by roughly $17 billion after VA officials could not offer reasoning at a congressional hearing in September.
Sen. Richard Blumenthal, D-Conn., ranking member of the Senate Veterans’Affairs Committee, and six other Democrats on the committee sent a letter Sept. 23 to Oracle Executive Chairman Larry Ellison and CEO Mike Sicilia demanding documents and detailed explanations for the increase. The lawmakers gave Oracle until Oct. 23 to respond.
The request comes weeks after VA increased the ceiling on its Oracle EHR contract from roughly $10 billion to approximately $27 billion.
At a Sept. 2 House Veterans’ Affairs Committee hearing, lawmakers repeatedly pressed VA officials to explain what specifically drove the additional $17 billion.
VA Deputy Secretary Paul Lawrence told lawmakers that VA had estimated what it would cost to complete the system’s deployment through 2031, asked Oracle for a proposal and then relied on the department’s acquisition team to negotiate the contract.
But Lawrence said he was not involved in the negotiations and could not explain the specific basis for Oracle’s proposal, how much VA negotiated from Oracle’s request or what specifically drove the additional costs.
When lawmakers asked where the $17 billion was going, Lawrence said it was not necessarily all going to Oracle.
Oracle declined to appear at the Sept. 2 hearing after initially accepting the invitation. The House committee subsequently voted 19-0 to subpoena Ellison and Sicilia to testify.
The Senate lawmakers said they support the House subpoenas and expect Oracle to comply. They also separately asked Senate Veterans’ Affairs Committee Chairman Jerry Moran, R-Kan., to hold a full committee hearing examining the EHR modernization program’s costs, delays and patient-safety concerns.
The Senate lawmakers are now asking Oracle to provide documents and analyses supporting the increase, including a full itemization of the “unanticipated complexities” cited as the basis for the additional costs.
They also want Oracle to explain what changed since 2022, when Sicilia told the Senate Veterans’ Affairs Committee that Oracle was committed to delivering the VA system without exceeding the contracted cost of $10 billion and would fix issues at Oracle’s expense.
The lawmakers also want Oracle to describe its role in helping VA address the 14 outstanding Government Accountability Office recommendations related to EHR modernization that remain not fully implemented. Documentation of cybersecurity performance measures have also been requested, along with an inquiry as to what Oracle has implemented or has plans to implement for the EHR system, in light of the GAO’s finding that the program lacks adequate cyber performance measures.
The $27 billion contract ceiling is separate from VA’s broader estimate of the program’s total lifecycle cost.
Lawrence told House lawmakers that VA estimates it will cost about $37 billion to complete deployment of the system through 2031, plus roughly $11 billion for sustainment, for a total of about $48 billion. He acknowledged during questioning that the estimate was not an independent assessment.
The GAO also told lawmakers that VA had not provided an updated cost estimate or enough detailed documentation for the watchdog agency to determine whether the department’s plans followed best practices.
The GAO reported that VA had fully implemented four of its 18 EHR modernization recommendations but had not fully implemented 14, including 12 priority recommendations, as of August.
Natalie Oliverio is an independent journalist and Navy veteran who covers military and veterans’ issues. Drawing on her experience as a talent executive and mentor, she writes about the policies, people and programs shaping the military community.
