Pentagon Software Sharing May Create Competition for Cerner

Electronic-health-record vendors Epic Systems Corp. and Cerner Corp. may face competition from a joint patient information-sharing network being developed by the U.S. Defense and Veterans Affairs departments, analysts said. Prompted by President Barack Obama's push for medical facilities to adopt electronic records, hospitals may pay companies to modify the open-source code likely to power the government-developed system, rather than buying commercial systems, said Ed Meagher, former Veterans Affairs deputy chief information officer.

Veterans Affairs plans to modernize its records system using open-source software, making it likely the joint VA-DoD system also will use it, said Meagher, now vice president of health care strategy for Computer Sciences Corp. in Falls Church, Virginia. Open-source software is publicly available and can be shared with other organizations at no charge.

"VA and the DOD are going to spend north of $4 billion turning these two systems into one new system," said Meagher, whose company may win business modifying the government's open- source code for other hospital systems. "And when they're done, anybody in the world will be able to use it."...