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PAUL DE LA GARZA and STEPHEN NOHLGRENAs investigators sort out problems with its troubled Bay Pines computer system, BearingPoint gets another new job.
ST. PETERSBURG - The Department of Veterans Affairs recently awarded a new computer contract to the same consultant under investigation for its work on a troubled new computer system at Bay Pines VA Medical Center.
BearingPoint was awarded the $445,000 contract in March even as federal investigators were examining the company's performance on the much larger Bay Pines project.
The new contract calls for the company to evaluate whether another VA computer system should be overhauled. That system monitors the cost-effectiveness and quality of patient treatment nationwide.
While the contract is small by federal standards, BearingPoint or another contractor eventually could be paid millions of dollars if a complete changeover is recommended, a former VA official said Friday.
Dr. Howard Green, a creator of the computer system under evaluation, said the cost is bound to escalate because the idea behind the modernization program is for BearingPoint to come up with better alternatives.
VA officials in Washington did not respond Friday to several telephone calls seeking comment.
BearingPoint spokesman John Schneidawind said the VA hired the company in March to review how well the Decision Support System helps VA management make cost-effective decisions. BearingPoint is scheduled to deliver its assessment to the VA by Sept. 21.
Schneidawind said the contract covers the first phase of DSS modernization. He emphasized that BearingPoint "is not being asked to provide cost estimates for future related work, nor has the VA requested a proposal from BearingPoint for future phases."
IBM and Deloitte Touche also bid on the contract, Schneidawind said. "We won, fair and square."
BearingPoint got the new contract a month after Congress and the VA inspector general began looking into its handling of a $472-million trial computer system at Bay Pines.
Hospital administrators say the Core Financial and Logistics System, or CoreFLS, is flawed and has contributed to scores of surgery cancellations.
In a March 19 report, the inspector general criticized the VA's lack of control in awarding the CoreFLS contract to BearingPoint. He said the VA should have estimated what CoreFLS was going to cost, then measured BearingPoint's contract proposal against those estimates.
Instead, some CoreFLS tasks had no cost estimates; two tasks had estimates identical to numbers BearingPoint submitted the same day. "It appears that the cost estimates ... were not prepared independently," the inspector general wrote.
VA documents that described what the CoreFLS job would entail contained wording and formats "either exact or quite similar to the contractor's proposal," the IG said. "This discovery is troublesome because either BearingPoint was actually the author of the statement of work or VA accepted a regurgitation of VA's "Statement of Work' as an acceptable technical proposal."
Schneidawind declined to comment on the IG report because it was preliminary. The final report has not been released.
CoreFLS had been scheduled to be rolled out nationally in February, but VA Secretary Anthony Principi put the program on hold while Carnegie Mellon conducts an assessment of the system. A report is due in June.
Under the new contract, BearingPoint will focus on DSS, which is similar to cost-accounting programs used by about 1,400 medical facilities around the world. Individual patients' medical records are entered into the computer, along with the cost of treating the patients and the results of that treatment. The computer analyzes these data and helps managers decide if the treatment made sense financially and medically.
Though the DSS system was fully implemented in 1999, some VA managers were slow to warm to it.
David McClure, technology chief for the General Accounting Office, told Congress in 2002 that VA managers complained that DSS was difficult to use. Properly run, he said the DSS system could save the VA money and improve the treatment of patients.
But four years after it started, the VA had yet to appoint a permanent project director, he said. Also, the VA had not yet filled one-third of the 56 staff positions authorized to run DSS.
In congressional testimony a year after he retired in 1999, Green complained that VA leaders had not bought into the system.
"Careful analysis of DSS information could be powerful and could be seen as jeopardizing programs, power and careers," he told Congress.
In an interview Friday, Green said DSS works well and that the BearingPoint examination is unnecessary.
"You know what's going to happen, everything is going to fall apart," said Green, who retired from the VA in 1999. "So the government is going to spend hundreds and hundreds and hundreds of millions of dollars for naught."
Green's wife, Dr. Elisabeth McSherry, worked with him to create the program. She is the head of data systems for DSS at the VA and is scheduled to retire at the end of June.
Green, who worked with the VA from 1973 through 1994, said he began working on DSS in the 1980s because the VA had no system to analyze medical costs. He estimated that since its inception, the VA has spent between $400-million and $500-million on DSS.