Health minister Terry Lake admitted Monday he “read the riot act” to project leaders involved in building an $842-million integrated, electronic health records system because of disagreements, risk of cost overruns and stalled progress with the megaproject.

And while Lake said he’s still not at the point where he can say he’s satisfied and confident all issues are resolved, he’s hoping the arrival of a new contractor to replace the ousted IBM will help resolve challenges plaguing the 10-year information technology project.

In a few weeks, Cerner will take over the project, which aims to integrate software systems between all hospitals and health facilities in Provincial Health Services Authority (PHSA), Vancouver Coastal Health (VCH) and Providence Health Care.

While IBM was chosen through a tender process, Lake said Cerner was given the contract without tender. Lake did not disclose what Cerner will be paid, but said it will be funded within the existing budget, out of funds previously designated for IBM.

The health minister responded to Vancouver Sun questions after the release of Freedom of Information documents showing that for most of the past year, the gargantuan Clinical Systems and Transformation Project (CST) project has grappled with “serious shortfalls” in transparency, clarity and measures of success and is now more than a year behind schedule.

Described as one of the biggest health care system undertakings in provincial history, CST is now in a reset mode.

IBM has already been paid about $72 million for a few years of work. Getting out of the contract with IBM four months ago cost taxpayers at least $150,000 in legal fees and $40,000 in mediator costs.

Lake said health authorities will have their own employees working alongside Cerner contractors to build a system that satisfies all. Among other things, every “playbook” — a diagnostic and treatment information system — developed by IBM was rejected by project leaders and clinicians, according to documents obtained by The Sun.

The new system was supposed to be operating in the first of three dozen health facilities next month. But that goal has been pushed back a year. Lake said some of the delays relate to how to roll out the system. VCH sought a gradual start-up, while others wanted one in which hospitals start using the new software on a single, pre-determined day.

“The PHSA folks thought this big bang approach was good. You light up everything all at once. But VCH was concerned about that,” said Lake. To get all parties on the same page, Lake installed an assistant deputy minister, Sabine Feulgen, as project board chair, to be the government’s eyes and ears.

Lake said Feulgen had experience with big projects in her former job with the Treasury Board and he’s confident she’ll be able to monitor the project. In the past few months, Lake also instructed health authorities to reduce the “burn” (spending) rate on the project while PricewaterhouseCoopers (PWC) worked out a new governance model.

“There will be more accountability and clearer lines of authority,” Lake said, referring to the PWC model. About 200 workers, including contractors and health authority staff, have been working on the project for a few years, but about 70 were laid off or reassigned in the past few months. The project completion date is now estimated at 2024 and the first health facility is expected to go live with the new system in autumn, 2016.

Two external reviews of the digital medical record platform revealed “areas of significant concern,” according to a memo by Vancouver Coastal Health CEO Mary Ackenhusen to health ministry deputy minister Stephen Brown and other top officials.