CoreFLS experiment ended

After spending millions of dollars and thousands of hours, the Department of Veterans Affairs has decided to kill a pilot program intended to replace a financial management system at one of the busiest hospitals in the VA network.

On July 26, VA Secretary Anthony Principi gave orders to pull the plug on the project at the Bay Pines Veterans Affairs Medical Center in St. Petersburg, Fla., because its system doesn't work. An advisory team will decide whether the entire project that was supposed to encompass all 172 VA hospital facilities will also be ended.

The project, known as CoreFLS, has already cost over $200 million and was supposed to create an integrated system that combined logistical, billing and other management functions in October 2003. The VA has been paying BearingPoint Inc. $4 million a month to carry out the Florida pilot project, whose total value is estimated at $472 million.

"I've had serious concerns about the computer system since my visit to Bay Pines earlier this year," said Sen. Bill Nelson (D-Fla.). If a decision has been made to discontinue CoreFLS then I'll want to know what steps should be taken to recover some of the taxpayers' money."

VA officials planned the pilot as a way to highlight the strengths and weaknesses of certain commercial, off-the-shelf programs, Principi said in a statement.

CoreFLS was ill-fated from the start. A report in March by the VA's inspector general said employees were not being properly trained. And service suffered -- 81 surgeries were canceled between November 2003 and this past March because critical surgical supplies and instruments were not available or properly sterilized.

"Many of the problems with the CoreFLS project resulted from the manner in which the project is managed," the inspector general wrote in the report. "We found that data conversion needs management attention, employees need sufficient training to use CoreFLS and management needs to implement prior recommendations to improve the functionality of the CoreFLS system."

The VA spent $500,000 on a report by Carnegie Mellon University to analyze the project. That report has not been released, nor has a new inspector general's report that is currently sitting on Principi's desk. The report blamed a "lack of hands-on management and accountability from Bay Pines to the central office," according to sources close to the project.

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