VA awards $88.8K contract for routine preventative maintenance to Medtronic USA Inc

Contract Overview

Contract Amount: $88,800 ($88.8K)

Contractor: Medtronic USA Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-05-17

End Date: 2027-05-16

Contract Duration: 1,460 days

Daily Burn Rate: $61/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: ROUTINE PREVENTATIVE MAINTENANCE

Place of Performance

Location: CLARKSBURG, HARRISON County, WEST VIRGINIA, 26301

State: West Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $88,800.16 to MEDTRONIC USA INC for work described as: ROUTINE PREVENTATIVE MAINTENANCE Key points: 1. Contract awarded on a firm-fixed-price basis, indicating predictable costs for the government. 2. The contract duration of 1460 days (4 years) suggests a long-term need for these services. 3. The absence of small business set-aside indicates potential missed opportunities for smaller enterprises. 4. The contract is for electronic and precision equipment repair and maintenance, a critical support function. 5. Awarded by the Department of Veterans Affairs, likely supporting medical equipment within VA facilities.

Value Assessment

Rating: fair

The contract value of $88.8K over four years is relatively low, averaging $22.2K annually. Without specific details on the equipment being maintained or the scope of work, it's difficult to benchmark against similar contracts. However, given the routine nature of preventative maintenance, this value appears reasonable for a single vendor supporting specific equipment. The firm-fixed-price structure helps control costs.

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 among multiple vendors. This approach is typically used when a specific vendor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition means the government did not benefit from potential price reductions or service enhancements that could arise from a competitive bidding process.

Taxpayer Impact: Sole-source awards can lead to higher prices for taxpayers as there is no competitive pressure to drive down costs. It also limits the government's ability to explore alternative solutions or vendors.

Public Impact

Veterans receiving care at VA facilities in West Virginia will benefit from the reliable functioning of medical equipment. The contract ensures the continuity of essential maintenance services for critical medical devices. The geographic impact is focused on West Virginia, where the VA facilities requiring this maintenance are located. The contract supports the operational readiness of VA healthcare infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potentially increases costs for taxpayers.
Lack of small business participation may exclude smaller, specialized service providers.
Limited transparency due to sole-source nature makes it harder to assess true value for money.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Long contract duration suggests a stable, ongoing need for essential maintenance.
Award to a known entity (Medtronic) may imply a pre-existing relationship or specialized knowledge.

Sector Analysis

The healthcare equipment maintenance sector is a critical component of the broader healthcare industry, ensuring the operational integrity of medical devices. This contract falls under the Electronic and Precision Equipment Repair and Maintenance NAICS code (811210). While the dollar amount is modest, it represents a segment of the larger market for medical device servicing, which is substantial and often involves specialized knowledge and certifications. Benchmarking this specific contract is challenging without more detail, but the annual spend is typical for routine maintenance of a defined set of equipment.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This means that opportunities for small businesses to participate in providing these essential maintenance services were not actively pursued through this award mechanism. The focus was likely on securing the required service efficiently, potentially overlooking the benefits of engaging the small business ecosystem.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. As a sole-source award, oversight would focus on ensuring Medtronic USA Inc. fulfills the terms of the firm-fixed-price agreement and delivers the routine preventative maintenance as specified. Transparency is limited due to the non-competitive nature, but standard contract management practices would apply. There is no explicit mention of an Inspector General's involvement for this specific award, but IG oversight is a general function within the VA.

Related Government Programs

Medical Equipment Maintenance Contracts
Department of Veterans Affairs Healthcare Services
Routine Preventative Maintenance Services
Sole Source Medical Device Support

Risk Flags

Sole-source award may indicate limited market competition or unique vendor capabilities.
Lack of small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $88,800.16 to MEDTRONIC USA INC. ROUTINE PREVENTATIVE MAINTENANCE

Who is the contractor on this award?

The obligated recipient is MEDTRONIC USA 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 $88,800.16.

What is the period of performance?

Start: 2023-05-17. End: 2027-05-16.

What specific medical equipment is covered under this routine preventative maintenance contract?

The provided data does not specify the exact make, model, or type of medical equipment that Medtronic USA Inc. is contracted to perform routine preventative maintenance on. This information is crucial for a comprehensive understanding of the contract's scope and value. Without this detail, it is difficult to assess the complexity of the maintenance required, the criticality of the equipment to patient care, or to accurately benchmark the pricing against similar services for comparable devices. Further investigation into the contract's statement of work or associated documentation would be necessary to identify the specific equipment.

How does the annual cost of $22.2K compare to industry benchmarks for similar preventative maintenance services?

Benchmarking the annual cost of $22.2K for routine preventative maintenance is challenging without knowing the specific type and volume of medical equipment being serviced. For high-complexity, high-volume equipment like MRI machines or CT scanners, this annual cost might be considered low. However, for less complex or lower-volume devices, it could be within a reasonable range. Industry benchmarks vary significantly based on equipment type, manufacturer, service provider, and contract terms (e.g., response times, parts included). A more precise comparison would require details on the equipment covered and the scope of services included in Medtronic's contract.

What are the potential risks associated with awarding this contract on a sole-source basis?

The primary risk of a sole-source award is the potential for inflated pricing due to the lack of competitive pressure. Taxpayers may end up paying more than they would in a competitive environment. Another risk is the potential for complacency from the awarded contractor, as there is no immediate threat of losing the business to a competitor. Furthermore, the government misses out on potential innovations or service improvements that might be offered by other qualified vendors. This also limits the government's ability to explore alternative solutions or leverage market dynamics to its advantage.

What is Medtronic USA Inc.'s track record with the Department of Veterans Affairs for similar maintenance services?

The provided data indicates Medtronic USA Inc. is the awardee for this specific contract. However, it does not offer insight into their past performance history with the Department of Veterans Affairs (VA) or other federal agencies for similar maintenance services. A thorough assessment of Medtronic's track record would involve reviewing past performance evaluations, any documented issues or commendations on previous contracts, and their overall reliability in fulfilling government requirements. This information is typically available through federal procurement databases or agency performance management systems.

What is the historical spending pattern for routine preventative maintenance of electronic and precision equipment by the VA?

The provided data only pertains to this single contract award. It does not offer any historical spending patterns for routine preventative maintenance of electronic and precision equipment by the Department of Veterans Affairs (VA). To analyze historical spending, one would need access to broader procurement data covering multiple years and various contracts within this category. This would allow for trend analysis, identification of major spending shifts, and comparison of spending across different types of equipment or service providers over time.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Electronic and Precision Equipment Repair and Maintenance

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Medtronic Public Limited Company

Address: 710 MEDTRONIC PKWY, MINNEAPOLIS, MN, 55432

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $109,625

Exercised Options: $88,800

Current Obligation: $88,800

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline