Independent Project Oversight Report (IPOR) Rating

Key Questions

Is the project on track to satisfy the customer's business objectives?Yes

Is the project on track to achieve the objectives in the approved timeframe?Yes

Is the project on track to achieve the objectives within the approved budget?Yes

Project Overall Health

Comments

Green

The overall project health rating for this reporting period is Green. Project current status and key accomplishments: • Project Completion Status - 48% complete. • Implementation progress of project milestones across the five hospital sites: - MedSelect: - Completed: DSH-C - In progress: DSH-M and DSH-A - Not started: DSH-N and DSH-P - RxWorks – Removed from project scope: - Suspended: DSH-C and DSH-M - Not started: DSH-A, DSH-N, and DSH-P - Centrack: - Completed: DSH-C, DSH-M, and DSC-A - Not started: DSH-N and DSH-P - Verify Spooler: - Completed: DSH-C, DSH-M, and DSH-N - In progress: DSH-A - Not started: DSH-P • Organization Change Management (OCM): - OCM-related activities across all the hospital sites are ongoing. • Fire Marshal permits have been issued for all five hospital sites. • DSH-Coalinga (DSH-C) MedSelect (Deployment completed): - Hospital-wide deployment of MedSelect v 9.1.3 completed. Centrack deployment completed. Verify & Spooler deployment completed. • DSH-Metro (DSH-M) MedSelect deployment is in progress. First unit go-live planned for the week of September 14, 2026, has been moved to mid-October due to reported issues with the new software release. RxWorks deployment completed on August 26, 2025. Verify & Spooler deployment completed. Centrack deployment completed: - Post-implementation activities are in progress. Infrastructure-related work is completed. • DSH-Atascadero (DSH-A) MedSelect (Deployment in progress): - Planning efforts for the MedSelect Cabinet implementation at DSH-A are in progress. - Existing MedSelect system upgrade to v.9.1.3 completed. Centrack workstation installation completed on 7/25/25. Verify & Spooler (Go-live is planned for fall of 2026). Infrastructure (In progress) - Phase 1 of the construction works is complete. Phase 2 completion is expected in February 2027. • DSH-Napa (DSH-N) MedSelect (Not started) Centrack (Not started): - Centrack implementation follows successful MedSelect installation and configuration. Verify & Spooler implemented in September 2026. Infrastructure (Planning in progress): - The construction Invitation for Bid (IFB) was released on July 1. Contract development in progress. • DSH-Patton (DSH-P) MedSelect (Upgrade of existing machines is complete) - The existing physical MedSelect server was migrated to a new virtual server and upgraded from older version to 9.1.2/Oracle Standard. - Planning for hospital-wide deployment of v9.1.2 on new machines is in progress. Centrack (Not started): - Centrack implementation follows successful MedSelect installation and configuration. Verify & Spooler (Not started). Infrastructure (Planning in progress): - The construction IFB was released on July 7. Contract development in progress. • Project Approval Lifecycle (PAL) - (1/2019 – 4/2022) - PAL Stage 4 was approved in July 2021, and again re-validated in April 2022.

Focus Area/Rating	Comments
Governance Green	The Governance health rating for this reporting period is Green. The project continues to include the pillars of proper project governance: • Structure: The project team, Executive Committee, vendor, and user community are established and follow established roles and responsibilities. • People: The right people with the right skills are in place, and project, vendor, and hospital resources are engaged. • Communication: Consistent information sharing is taking place. Key project information and status are documented and communicated through both push and pull mechanisms. • Decision-Making: Roles and responsibilities are established through an approved Governance plan and project RACI, and decisions are being logged. Note: An Executive Steering Committee is established and meets regularly, and a dedicated meeting for working risks and issues is regularly scheduled, where risk and issue logs are documented and worked on in a consistent manner.
Time Management Yellow	The Time Management health rating for this reporting period is Yellow. The health rating has changed to yellow for this reporting period, primarily due to the following delays affecting the project timeline: 1. Construction at DSH-P and DSH-N: Construction was delayed by six months due to DGS Form 23 approval taking six months instead of three, new HCAI involvement requirements adding two months, and a three-month delay in the Department of State Architect exemption. DSH issued an Invitation for Bids (IFB) for each site in July, and construction began in October. The delay is expected to extend the project timeline by approximately 9%, shifting completion from February to June 2027. 2. ARxIUM equipment delivery: Delivery delays for DSH-P and DSH-N are causing a 7% impact on the DSH-Napa schedule. DSH requested corrective action from ARxIUM on September 10, 2026, with a response due September 24; no response has been received. DSH has escalated the issue to its legal teams. The preliminary assessment is that DSH-N completion, and the overall pharmacy modernization project, will be delayed by an additional 6-8 weeks. 3. MedSelect software: In September, pharmacies at DSH-Metro (DSH-M) and DSH-Coalinga (DSH-C) reported two critical medication-dispensing issues associated with MedSelect v.9.1.3.5000. To prevent the issue from recurring, the application was rolled back at DSH-C, and the planned go-live at DSH-M was suspended. ARxIUM identified the root causes and plans to release a fix during the week of October 12, 2026, resulting in a 4% delay to the milestone. The project team is assessing the impact of these delays on the overall project timeline, once confirmed, any changes to the project timeline will be reported in future IPORs. The IPO team is concerned about recurring delays in the MedSelect go-live at DSH-M and the upgrade at DSH-C, which is pushing back planned activities at the remaining hospital sites.
Cost & Contract Management Green	The Cost & Contract Management health rating for this reporting period is Green. The project experienced a cost variance of over 10%. To address this, the project submitted an SPR to the CDT that was approved on March 5, 2025, re-baselining the project cost. As a result of the PSC's December 8, 2025 decision not to proceed with the RxWorks implementation, the project team is assessing the impact of removing RxWorks-related activities from the project scope. The main vendor contract, set to expire in November 2026, is being amended through a Non-Competitive Bidding (NCB) process, and anticipated to be effective at the end of November 2026. Any change to the project cost and contract will be reported in the upcoming IPORs.
Scope Management Green	The Scope Management health rating for this reporting period is Green. The project is on track to achieve the set objectives. The Pharmacy Modernization project will improve patient care and pharmacy operations by implementing an enterprise-wide automated solution across all five state hospitals. The elements of this project are: Inventory (medication) control, medication repackaging and dispensing, secure management of controlled medications, accurate patient billing information, pharmacy data integration across all five hospitals (Coalinga, Metropolitan, Atascadero, Napa, and Patton), and modifications to the existing application environment and architecture to support new hardware and software.
Resources Green	The Resources health rating for this reporting period is Green. • A full-time state project manager is serving the project and is supported by another project manager on an as-needed basis, along with several DSH team members supporting the overall project effort. • One vendor project manager, along with other technical staff, is supporting the project.
Quality Yellow	The Quality health rating for this reporting period is Yellow. The Quality Focus Area rating has changed to Yellow for this reporting period, primarily because of recent critical issues identified in the vendor’s new MedSelect software release (version 9.1.3.5000). The issues were serious and sensitive and could affect confidence in the system. The project team promptly identified the issues, rolled back the software to the previous version, and reported them to the vendor. The vendor is working on a fix that is expected to be released in mid-October. The IPO team considers this a critical issue and recommends that the vendor conduct thorough testing before releasing new software versions to the production environment. The vendor should also take steps to prevent similar occurrences in the future. In addition, a faster turnaround time would help keep the project on schedule. Other than the above issues, to date, neither vendor products nor state activities have raised major project quality concerns. The high number of hardware issues with newly installed MedSelect equipment, along with recent critical issues resulting from the new MedSelect software release, are being addressed by the vendor and closely monitored by the project team.
Risk And Issues Green	The Risks and Issues health rating for this reporting period is Green. The IPO team confirms that the project team thoroughly maintains the project risk and issue register. In addition to the ability for stakeholders to raise risks and issues during regularly scheduled project meetings, the project has established a dedicated meeting to review risks and issues regularly. that the project team conducts regular meetings and maintains thorough records as follows:
Transition Readiness Green	The Transition Readiness health rating for this reporting period is Green. As part of Transition Readiness, the team is currently working with the vendor on future workflows and demonstrations to ensure all organizational change management elements are documented, reviewed, and approved. Additionally, stakeholders are involved throughout the project, participating in all walkthroughs and evaluations of the equipment configurations to ensure they are effective for their specific environments.
Conditions For Approval Green	There are no Conditions for Approval.
Corrective Action Green	There are no Corrective Action Plan Items.

• Special Project Report 1 (pdf)
• Stage 4 Project Readiness and Approval (pdf)
• Stage 3 Part B Solution Development (pdf)
• Stage 3 Part A Solution Development (pdf)
• Stage 2 Alternative Analysis (pdf)
• Stage 1 Business Analysis (pdf)