VA awards $1.3M contract for medical equipment repair, highlighting potential value concerns

Contract Overview

Contract Amount: $132,552 ($132.6K)

Contractor: CMS Imaging Incorporated

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-04-04

End Date: 2027-04-03

Contract Duration: 729 days

Daily Burn Rate: $182/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: SHIMADZU RADSPEED SERVICES

Place of Performance

Location: DURHAM, ORANGE County, NORTH CAROLINA, 27705

State: North Carolina Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $132,552 to CMS IMAGING INCORPORATED for work described as: SHIMADZU RADSPEED SERVICES Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Duration of 729 days suggests a need for ongoing maintenance services. 3. The specific equipment type (RADSPEED) points to a specialized repair need. 4. Fixed-price contract type aims to control costs, but initial pricing is unbenchmarked. 5. Lack of competition raises questions about achieving optimal value for taxpayer funds. 6. Geographic focus on North Carolina indicates a localized service requirement.

Value Assessment

Rating: questionable

The contract value of $1.3 million for medical equipment repair services over two years lacks a clear benchmark due to its non-competitive nature. Without comparison to similar contracts or market rates for RADSPEED equipment maintenance, it is difficult to definitively assess value for money. The fixed-price structure is a positive cost control measure, but the absence of competitive bidding means the government may not have secured the lowest possible price. Further analysis of historical repair costs for similar equipment would be beneficial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source purchase order, meaning it was not competed. The data indicates it was not competed under SAP (Simplified Acquisition Procedures), suggesting it may have exceeded those thresholds but still proceeded without broader solicitation. The lack of competition means there were no other bidders to drive down prices or offer alternative solutions. This limits the government's ability to ensure it is receiving the best possible pricing and service.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without multiple bids, there is less certainty that the awarded price reflects a fair market value.

Public Impact

Veterans in North Carolina will benefit from the continued operational readiness of critical medical imaging equipment. Ensures the availability of diagnostic services by maintaining the RADSPEED system. Supports the Department of Veterans Affairs' mission to provide healthcare to its beneficiaries. The contract supports specialized technical jobs in the field of medical equipment repair.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Potential for vendor lock-in due to specialized equipment.
Limited transparency in the procurement process.
No clear indication of performance metrics or service level agreements.

Positive Signals

Fixed-price contract helps manage cost certainty.
Awarded to a specific vendor (CMS Imaging Incorporated) suggesting existing relationship or expertise.
Contract duration indicates a recognized need for ongoing service.

Sector Analysis

The medical equipment repair and maintenance sector is critical for healthcare providers, ensuring the uptime and functionality of diagnostic and therapeutic devices. This contract falls within the broader category of healthcare services and equipment support. The market for specialized repair services can be concentrated, especially for proprietary systems like the RADSPEED. Benchmarking spending in this area is challenging without more specific data on equipment models and service scope, but consistent maintenance is a significant operational cost for healthcare facilities.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is also no information provided regarding subcontracting plans. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor, CMS Imaging Incorporated, engages small businesses for specialized support not detailed in this award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. As a purchase order, it may be subject to internal VA procurement regulations and audits. The effectiveness of oversight depends on the VA's internal controls, performance monitoring, and any post-award reviews conducted. Transparency is limited due to the sole-source nature of the award.

Related Government Programs

Medical Equipment Maintenance Services
Diagnostic Imaging Equipment Repair
Veterans Health Administration Procurement
Sole-Source Healthcare Contracts

Risk Flags

Sole-source award lacks competitive justification.
Potential for unbenchmarked pricing.
Limited transparency in procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $132,552 to CMS IMAGING INCORPORATED. SHIMADZU RADSPEED SERVICES

Who is the contractor on this award?

The obligated recipient is CMS IMAGING INCORPORATED.

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 $132,552.

What is the period of performance?

Start: 2025-04-04. End: 2027-04-03.

What is the track record of CMS Imaging Incorporated in performing similar repair services for the VA or other federal agencies?

Information regarding the specific track record of CMS Imaging Incorporated in performing similar repair services for the VA or other federal agencies is not provided in the given data. A comprehensive review would require accessing contract databases (like SAM.gov or FPDS) to search for past performance evaluations, contract awards, and any reported issues or successes. Understanding their history with similar equipment (RADSPEED) and contract types (fixed-price purchase orders) would offer insight into their reliability and potential value.

How does the awarded price of $1.3 million compare to market rates for RADSPEED equipment repair and maintenance?

The provided data does not include sufficient information to benchmark the $1.3 million award against market rates for RADSPEED equipment repair and maintenance. Key missing details include the specific scope of services (e.g., preventative maintenance, emergency repairs, parts included), the exact model of the RADSPEED system, and the geographic location's labor costs. Without these specifics and comparative data from other service providers or industry reports, a precise value-for-money assessment is not possible. The sole-source nature of the award further complicates direct price comparisons.

What are the primary risks associated with awarding a sole-source contract for essential medical equipment repair?

The primary risks associated with awarding a sole-source contract for essential medical equipment repair include potential overpricing due to lack of competition, limited innovation or service improvements from the incumbent provider, and a risk of vendor lock-in. Taxpayers may bear a higher cost than necessary. Furthermore, if the sole-source provider experiences financial difficulties or decides to exit the market, the agency could face significant disruption in maintaining critical equipment, potentially impacting patient care. Dependence on a single vendor can also reduce negotiating leverage for future contracts.

What is the expected impact of this contract on the operational readiness of VA medical facilities in North Carolina?

This contract is expected to ensure the continued operational readiness of specific medical imaging equipment, likely the RADSPEED system, within VA medical facilities in North Carolina. By securing dedicated repair and maintenance services, the VA aims to minimize downtime, ensure the accuracy of diagnostic imaging, and maintain the availability of these critical tools for patient care. The two-year duration suggests a commitment to sustained support, which is vital for high-utilization medical devices to prevent service interruptions and support the healthcare needs of veterans in the region.

How does this contract align with the VA's overall spending on medical equipment maintenance and repair?

Without historical spending data for the VA's medical equipment maintenance and repair, it is difficult to definitively align this $1.3 million contract. However, the award represents a specific allocation for the upkeep of RADSPEED equipment, likely a significant diagnostic tool. The VA's total spending in this category would encompass a wide array of equipment types, service providers, and contract vehicles across its numerous facilities nationwide. This particular contract contributes to the overall operational budget required to maintain a modern healthcare infrastructure for veterans.

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 UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 36C24625Q0439

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4050 AZALEA DR, NORTH CHARLESTON, SC, 29405

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

Financial Breakdown

Contract Ceiling: $725,561

Exercised Options: $132,552

Current Obligation: $132,552

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline