VA awards $19.5M for emergency physician services, raising questions about competition and value

Contract Overview

Contract Amount: $19,524,722 ($19.5M)

Contractor: University Emergency Medical Services Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2020-03-01

End Date: 2025-05-31

Contract Duration: 1,917 days

Daily Burn Rate: $10.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: BOARD CERTIFIED/BOARD ELIGIBLE EMERGENCY DEPARTMENT PHYSICIAN AND ADVANCED PRACTICE PROVIDER SERVICES ON BEHALF OF THE VA WESTERN NEW YORK HEALTHCARE SYSTEM AT BUFFALO

Place of Performance

Location: BUFFALO, ERIE County, NEW YORK, 14215

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $19.5 million to UNIVERSITY EMERGENCY MEDICAL SERVICES INC for work described as: BOARD CERTIFIED/BOARD ELIGIBLE EMERGENCY DEPARTMENT PHYSICIAN AND ADVANCED PRACTICE PROVIDER SERVICES ON BEHALF OF THE VA WESTERN NEW YORK HEALTHCARE SYSTEM AT BUFFALO Key points: 1. Contract awarded on a firm-fixed-price basis, providing cost certainty but potentially limiting flexibility. 2. The contract duration of over 1900 days suggests a long-term need for these specialized services. 3. Sole-source award indicates a lack of competitive bidding, potentially impacting price discovery. 4. The contractor, University Emergency Medical Services Inc., has a history with the VA. 5. Services are critical for the VA Western New York Healthcare System, impacting veteran care. 6. The North American Industry Classification System (NAICS) code 611310 points to educational services, which is unusual for physician services.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without comparable sole-source awards or detailed service breakdowns. The firm-fixed-price structure provides some cost predictability. However, the absence of competition means there's no direct market comparison to assess if the pricing is optimal. The total award amount of $19.5 million over approximately five years suggests a significant investment in emergency physician services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one responsible source is available or in cases of urgent need. The lack of competition means that multiple bidders did not have the opportunity to offer their services, which can limit price negotiation and potentially lead to higher costs for the government.

Taxpayer Impact: Taxpayers may not be receiving the best possible price due to the absence of a competitive bidding process. This could result in a higher overall expenditure for these essential medical services.

Public Impact

Veterans in the Western New York region will benefit from continuous access to board-certified emergency department physicians and advanced practice providers. The services ensure the operational readiness of the VA Western New York Healthcare System's emergency department. This contract supports the delivery of critical healthcare services, directly impacting patient outcomes for veterans. The contract supports a specialized healthcare workforce, ensuring adequate staffing for emergency medical care.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to suboptimal pricing.
Unusual NAICS code assignment could indicate misclassification or unique service delivery model.
Firm-fixed-price contract may not adapt well to fluctuating service demands.
Long contract duration limits opportunities for re-evaluation of market rates.

Positive Signals

Ensures continuity of care for veteran emergency services.
Firm-fixed-price provides budget certainty for the VA.
Contract is with an established entity, potentially reducing onboarding risks.
Services are critical for a key healthcare facility.

Sector Analysis

The healthcare sector, particularly emergency medical services, is a critical area of federal spending. Contracts for physician staffing are common across various agencies, including the VA, to ensure adequate patient care. The market for these services is competitive, with numerous providers vying for government contracts. However, sole-source awards, like this one, can occur due to specialized needs or specific circumstances. Benchmarking is difficult without comparable data, but overall federal spending on healthcare services is substantial.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to a single, likely larger, entity suggests that small businesses were not actively solicited or considered for this specific requirement. This may limit opportunities for small business participation in providing these specialized emergency physician services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures are inherent in the firm-fixed-price structure, requiring the contractor to deliver specified services within the agreed-upon cost. Transparency is limited due to the sole-source nature of the award, making public scrutiny of the procurement process more difficult. The VA Office of Inspector General may conduct audits or investigations if concerns arise regarding performance or cost.

Related Government Programs

VA Physician and Provider Services
Emergency Medical Services Contracts
Healthcare Staffing Contracts
Veterans Health Administration Services

Risk Flags

Lack of Competition
Unusual NAICS Code
Potential for Overpricing
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $19.5 million to UNIVERSITY EMERGENCY MEDICAL SERVICES INC. BOARD CERTIFIED/BOARD ELIGIBLE EMERGENCY DEPARTMENT PHYSICIAN AND ADVANCED PRACTICE PROVIDER SERVICES ON BEHALF OF THE VA WESTERN NEW YORK HEALTHCARE SYSTEM AT BUFFALO

Who is the contractor on this award?

The obligated recipient is UNIVERSITY EMERGENCY MEDICAL SERVICES INC.

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 $19.5 million.

What is the period of performance?

Start: 2020-03-01. End: 2025-05-31.

What is the track record of University Emergency Medical Services Inc. with the VA?

University Emergency Medical Services Inc. has a history of contracting with the Department of Veterans Affairs. While specific details of past performance are not provided in this data snippet, the fact that they were awarded this significant sole-source contract suggests a prior relationship or established capability recognized by the VA. Further investigation into their contract history, performance reviews, and any past issues or commendations would be necessary for a comprehensive assessment of their track record. This could involve reviewing contract databases and VA performance management systems.

How does the pricing of this contract compare to similar VA emergency physician service contracts?

Direct comparison of pricing for this contract is difficult due to its sole-source nature and the firm-fixed-price structure. Typically, competitive bidding allows for price discovery and benchmarking against market rates. Without comparable competitively awarded contracts for similar services at the VA Western New York Healthcare System or other comparable facilities, it's challenging to definitively state if the pricing is optimal. The total award of $19.5 million over approximately five years provides a broad figure, but a per-physician or per-hour cost analysis against market data would be needed for a more granular assessment of value for money.

What are the primary risks associated with this sole-source award for emergency physician services?

The primary risk associated with this sole-source award is the potential for inflated costs due to the lack of competition. Without competing bids, the VA may not be securing the most cost-effective solution. Another risk is contractor performance; while the firm-fixed-price contract provides cost certainty, it doesn't guarantee quality or responsiveness. If the contractor underperforms or faces staffing issues, it could disrupt critical emergency services for veterans. The unusual NAICS code also presents a potential risk if it misrepresents the actual services provided, leading to potential compliance or oversight issues.

How effective is the VA in ensuring value for money through sole-source contracts for critical medical services?

The VA's effectiveness in ensuring value for money through sole-source contracts can vary. While sole-source awards are intended for specific, justifiable circumstances (e.g., unique capabilities, urgent needs), they inherently reduce the potential for competitive pricing. The VA relies on robust internal cost analysis, negotiation, and performance monitoring to mitigate these risks. However, the absence of a competitive baseline makes it harder to ascertain if the 'best value' is achieved. For critical services like emergency physician staffing, continuity of care is paramount, which can sometimes justify a sole-source approach, but requires diligent oversight to prevent price gouging.

What are the historical spending patterns for emergency physician services at the VA Western New York Healthcare System?

Historical spending patterns for emergency physician services at the VA Western New York Healthcare System are not detailed in the provided data. This specific contract, valued at $19.5 million over its duration, represents a significant investment. To understand historical patterns, one would need to examine previous contracts for similar services at this specific facility, noting their award types (competitive vs. sole-source), durations, values, and the contractors involved. Analyzing trends in spending, pricing, and competition over time would provide crucial context for evaluating the current contract's justification and value.

What is the significance of the NAICS code 611310 (Colleges, Universities, and Professional Schools) for this contract?

The assignment of NAICS code 611310, which pertains to Colleges, Universities, and Professional Schools, to a contract for emergency physician services is highly unusual and warrants further investigation. Typically, physician services would fall under healthcare-related NAICS codes (e.g., 62). This discrepancy could indicate several possibilities: the contractor is an academic medical institution providing services as part of a teaching program, there's a unique contractual arrangement involving educational components, or it could be a data entry error. Understanding the rationale behind this NAICS code is crucial for accurately assessing the contract's nature, scope, and compliance.

Industry Classification

NAICS: Educational Services › Colleges, Universities, and Professional Schools › Colleges, Universities, and Professional Schools

Product/Service Code: MEDICAL SERVICES › GENERAL HEALTH CARE SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36C24219R0055

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 100 HIGH ST, BUFFALO, NY, 14215

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

Financial Breakdown

Contract Ceiling: $22,872,694

Exercised Options: $19,524,722

Current Obligation: $19,524,722

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline