VA Spends $2.6M on Philips Imaging Equipment Maintenance, Awarded via Full and Open Competition

Contract Overview

Contract Amount: $2,639,858 ($2.6M)

Contractor: Philips North America LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-03-01

End Date: 2027-02-28

Contract Duration: 1,460 days

Daily Burn Rate: $1.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PHILIPS IMAGING EQUIPMENT MAINTENANCE

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10001

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.6 million to PHILIPS NORTH AMERICA LLC for work described as: PHILIPS IMAGING EQUIPMENT MAINTENANCE Key points: 1. The Department of Veterans Affairs (VA) awarded a contract valued at $2.64 million for Philips imaging equipment maintenance. 2. The contract was awarded to PHILIPS NORTH AMERICA LLC, the original equipment manufacturer. 3. Competition was full and open, suggesting a competitive bidding process. 4. The contract duration is approximately four years, aligning with typical maintenance cycles. 5. The spending is categorized under Irradiation Apparatus Manufacturing.

Value Assessment

Rating: good

The contract value of $2.64 million over four years appears reasonable for specialized imaging equipment maintenance. Benchmarking against similar OEM maintenance contracts would provide a more precise assessment of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded using full and open competition, which typically drives competitive pricing. The award to the OEM suggests they may have offered the most advantageous proposal.

Taxpayer Impact: The competitive nature of the award is positive for taxpayers, aiming to secure fair market value for essential medical equipment maintenance.

Public Impact

Ensures continued operation of critical medical imaging equipment for veterans. Supports the VA's mission to provide healthcare services. Maintains the functionality of advanced diagnostic tools.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for higher costs with OEM-only maintenance if alternatives exist.
Reliance on a single vendor for critical equipment support.

Positive Signals

Full and open competition utilized.
Contract awarded to the original equipment manufacturer, ensuring expertise.
Long-term maintenance plan for essential medical equipment.

Sector Analysis

This contract falls within the healthcare sector, specifically related to medical equipment maintenance. Spending on such services is crucial for maintaining the operational readiness of healthcare facilities and ensuring patient care.

Small Business Impact

The contract was awarded to a large corporation (PHILIPS NORTH AMERICA LLC) and there is no indication of small business participation in this specific award.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. Standard oversight mechanisms for federal contracts, including performance monitoring and payment verification, would apply.

Related Government Programs

Irradiation Apparatus Manufacturing
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Potential for price creep over the contract duration.
Dependence on a single manufacturer for critical equipment.
Limited visibility into alternative maintenance solutions.
Need for ongoing performance monitoring to ensure service quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.6 million to PHILIPS NORTH AMERICA LLC. PHILIPS IMAGING EQUIPMENT MAINTENANCE

Who is the contractor on this award?

The obligated recipient is PHILIPS NORTH AMERICA LLC.

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 $2.6 million.

What is the period of performance?

Start: 2023-03-01. End: 2027-02-28.

What is the benchmark cost for similar imaging equipment maintenance contracts, and how does this award compare?

Benchmarking requires access to a database of similar contracts. However, a $2.64 million contract over four years averages $660,000 annually. This figure should be compared against contracts for comparable Philips imaging systems from other federal agencies or commercial entities to assess if it represents fair market value and competitive pricing.

What are the risks associated with relying solely on the OEM for maintenance, even with full and open competition?

The primary risk is potential price escalation over time, as OEMs may have less incentive to reduce costs when they are the sole provider of parts and specialized labor. There's also a risk of vendor lock-in, making it difficult to switch to third-party maintenance providers in the future, which could be more cost-effective.

How effectively does this contract support the VA's mission of providing timely and accurate diagnostic services to veterans?

This contract is essential for ensuring the uptime and proper functioning of critical imaging equipment, directly supporting the VA's ability to provide timely and accurate diagnostic services. Reliable maintenance prevents equipment failures that could delay diagnoses and treatment for veterans.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Irradiation Apparatus Manufacturing

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 22100 BOTHELL EVERETT HWY, BOTHELL, WA, 98021

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

Financial Breakdown

Contract Ceiling: $3,319,425

Exercised Options: $2,639,858

Current Obligation: $2,639,858

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: VA797H17D0022

IDV Type: IDC

Timeline