VA Awards $790M Contract to TriWest for Health Insurance Services in Virginia

Contract Overview

Contract Amount: $789,752,406 ($789.8M)

Contractor: Triwest Healthcare Alliance Corp

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-02-01

End Date: 2025-02-28

Contract Duration: 27 days

Daily Burn Rate: $29.3M/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS REPORT: MARCH 2025

Place of Performance

Location: FREDERICKSBURG, SPOTSYLVANIA County, VIRGINIA, 22408

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $789.8 million to TRIWEST HEALTHCARE ALLIANCE CORP for work described as: EXPRESS REPORT: MARCH 2025 Key points: 1. Significant contract value of $790 million highlights substantial investment in healthcare services. 2. Full and open competition suggests a robust market, but specific carrier performance is key. 3. Risk of service disruption or quality issues exists, requiring diligent oversight. 4. Healthcare sector spending is consistently high, with this contract representing a notable portion for regional services.

Value Assessment

Rating: good

The contract's value of $789,752,405.75 for a 27-day period suggests a high per diem cost. Benchmarking against similar large-scale health insurance carrier contracts is necessary to fully assess pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating multiple bidders participated. This method generally promotes competitive pricing and allows the government to select the best value.

Taxpayer Impact: The competitive award process aims to ensure taxpayer funds are used efficiently for essential healthcare services.

Public Impact

Veterans in Virginia will continue to receive essential health insurance coverage. The large contract value could impact market dynamics for other healthcare providers in the region. Ensuring seamless transition and uninterrupted service delivery is critical for beneficiaries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for service gaps if transition is not managed effectively.
Ensuring provider network adequacy and quality of care.
Monitoring contract performance against service level agreements.

Positive Signals

Awarded through full and open competition.
Addresses critical healthcare needs for veterans.
Clear contract duration allows for future re-evaluation.

Sector Analysis

This contract falls within the healthcare sector, specifically health insurance carriers. Spending in this area is driven by demand for comprehensive medical services and administrative support for government healthcare programs.

Small Business Impact

The provided data does not indicate specific small business participation in this large contract award. Further analysis would be needed to determine the extent of small business involvement.

Oversight & Accountability

Oversight will be crucial to ensure TriWest Healthcare Alliance Corp meets all contractual obligations and performance standards. The Department of Veterans Affairs must actively monitor service delivery and beneficiary satisfaction.

Related Government Programs

Direct Health and Medical Insurance Carriers
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

High contract value increases financial risk if performance issues arise.
Potential for service disruption during transition phases.
Dependence on a single carrier for a large population.
Ensuring adequate provider network coverage across Virginia.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $789.8 million to TRIWEST HEALTHCARE ALLIANCE CORP. EXPRESS REPORT: MARCH 2025

Who is the contractor on this award?

The obligated recipient is TRIWEST HEALTHCARE ALLIANCE CORP.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $789.8 million.

What is the period of performance?

Start: 2025-02-01. End: 2025-02-28.

What is the projected cost per veteran served under this contract, and how does it compare to previous contracts or industry benchmarks?

The total contract value is approximately $790 million over 27 days. Without the number of veterans served, a precise per-veteran cost cannot be calculated. However, this daily expenditure is substantial and warrants comparison with similar regional health insurance contracts to ensure cost-effectiveness and identify potential areas for savings.

What are the key performance indicators (KPIs) for this contract, and what are the penalties for non-compliance?

Specific KPIs are not detailed in the provided data. However, typical KPIs for such contracts include network adequacy, claims processing times, patient satisfaction scores, and adherence to quality of care standards. The VA's contract management team will monitor these, and penalties for non-compliance could range from corrective action plans to financial deductions or contract termination.

How will the VA ensure continuity of care and minimize disruption for veterans during the contract period?

The VA will likely implement a robust transition plan, working closely with TriWest and potentially incumbent providers to ensure seamless service delivery. This includes clear communication channels, provider onboarding, and mechanisms for addressing any emergent issues promptly to prevent gaps in care for the veteran population.

Industry Classification

NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15810 N 28TH AVE, PHOENIX, AZ, 85053

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $789,752,406

Exercised Options: $789,752,406

Current Obligation: $789,752,406

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10G19D0038

IDV Type: IDC

Timeline