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Cerner Corp CERN

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Cerner Unlikely to Be Affected Long-Term by VA Strategic Review; Implementation to Resume in 2022

Dylan Finley, CFA Equity Analyst

Analyst Note

| Dylan Finley, CFA |

Narrow-moat Cerner reported solid second-quarter results and provided insight into the short- and long-term revenue impact resulting from the Department of Veterans Affairs' strategic review of its electronic health record modernization program. As a reminder, it was announced in March 2021 that the VA would temporarily pause the $16 billion rollout of its EHR modernization project with Cerner, expected to be completed by 2028, while a review is launched into the program. The VA inspector general has noted several issues with implementation thus far--partially as a result of the agency's preparedness--resulting in higher costs, delays, and frustration among clinicians. Last week, the VA published a comprehensive report finding implementation issues were related to user training and governance, rather than technology issues with Cerner's EHR. The department announced it would continue to pause the EHR implementation program through the remainder of 2021 and would work closely with Cerner to ensure readiness at future sites beginning in 2022.

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Company Profile

Business Description

Cerner is a leading supplier of healthcare information technology solutions and tech-enabled services. The company is a long-standing market leader in the electronic health record industry, and along with rival Epic Systems corners a majority of the market for acute care EHR within health systems. The company is guided by the mission of the founding partners to provide seamless medical records across all healthcare providers to improve outcomes. Beyond medical records, the company offers a wide range of technology that supports the clinical, financial, and operational needs of healthcare facilities.

2800 Rockcreek Parkway
North Kansas City, MO, 64117
T +1 816 221-1024
Sector Healthcare
Industry Health Information Services
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 28, 2020
Stock Type Classic Growth
Employees 26,400