Oracle Cerner bleeds jobs as Veterans Affairs project stalls
Health acquisition freezes recruitment after $10 billion contract put on hold
Oracle has launched a round of job cuts at its acquired Cerner health tech biz after one of its mega projects stalled.
Reports suggest the majority of the layoff could be attributed to Cerner's difficulties in implementing systems for US Department of Veterans Affairs (VA), an electronic health records project worth around $10 billion.
In April, the department said the project had ground to an indefinite halt while it focused on improving five sites that currently use the new EHR as part of a larger program reset. VA would fix the issues with the EHR that were identified during the recent "assess and address" period, the department said in a statement.
The move followed evidence to a Senate Committee hearing which claimed the new health records system caused harm to nearly 150 patients at a Washington hospital.
In May, the department said it had renegotiated its contract with Cerner parent Oracle to hold it accountable for EHR deployment.
News outlet Insider has reported hundreds of Oracle layoffs as well as rescinded job offers and reduced open positions within its health unit, citing three people familiar with the matter.
- Kinder, gentler Oracle says it's changed, and now wants you to succeed
- VA, Oracle's Cerner agree on renegotiated health records contract
- US Veterans Affairs Dept shoots down $10B Oracle Cerner dream
- Oracle reportedly making job cuts at health IT arm Cerner
Oracle has declined the opportunity to comment.
The cutbacks follow upbeat results from Oracle. Q4 revenue was $13.8 billion, up 17 percent year-on-year. Quarterly net income of $3.32 billion represented 4 percent growth. Annual net income of $8.5 billion was a 27 percent jump.
Despite the difficulties in Oracle Cerner's EHR rollout for the Department of Veterans Affairs, CTO and founder Larry Ellison has been chipper about the company's prospects in the healthcare market. In March, he said he was "pleased with this early success of the Cerner business."
In June last year, he said the Oracle Cerner could "build a revolutionary new health management information system in the cloud."
"That system will deliver much better information to healthcare professionals. Better information will fundamentally transform healthcare," he claimed.
In October, he told computer conference attendees: "We're gonna bankrupt Western civilization unless we find a more efficient way of providing healthcare to everybody." ®