VA awards $1.24M for Pyxis PM system maintenance, raising questions about competition and value

Contract Overview

Contract Amount: $1,240,515 ($1.2M)

Contractor: Carefusion Solutions, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-06-01

End Date: 2026-11-30

Contract Duration: 2,008 days

Daily Burn Rate: $618/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: CAREFUSION PYXIS PM

Place of Performance

Location: DUBLIN, LAURENS County, GEORGIA, 31021

State: Georgia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $1.2 million to CAREFUSION SOLUTIONS, LLC for work described as: CAREFUSION PYXIS PM Key points: 1. Limited competition for essential medical equipment maintenance may lead to suboptimal pricing. 2. The contract's duration and firm-fixed-price structure could limit flexibility in addressing evolving needs. 3. Lack of a competitive bidding process warrants scrutiny of the awarded price against market benchmarks. 4. The sole-source nature of this award suggests potential reliance on a single vendor for critical infrastructure. 5. Performance context is limited due to the absence of comparative contract data. 6. The contract falls under the 'Other Electronic and Precision Equipment Repair and Maintenance' NAICS code.

Value Assessment

Rating: questionable

The contract value of $1.24 million for the CAREFUSION PYXIS PM system maintenance over approximately five years appears high given the lack of competitive bidding. Without comparable contracts or market data, it is difficult to definitively assess value for money. The firm-fixed-price structure, while providing cost certainty, may not be optimal if the scope of work changes significantly or if market prices for maintenance decrease. Further analysis would be needed to benchmark this against similar systems or 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 limits the opportunity for multiple vendors to bid, which typically drives down prices and encourages innovation. The absence of competition suggests that either CareFusion Solutions, LLC is the only provider capable of servicing this specific equipment, or that the agency did not adequately explore competitive options. This approach can lead to higher costs for taxpayers.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as there was no pressure from competing bids to lower costs.

Public Impact

Veterans will benefit from the continued maintenance and operational readiness of the CAREFUSION PYXIS PM system, crucial for medication management. The services delivered ensure the reliable functioning of essential medical equipment within VA facilities. The geographic impact is primarily within the facilities served by the Department of Veterans Affairs, likely nationwide. The contract supports the operational workforce within VA healthcare settings by ensuring equipment availability.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in inflated costs for taxpayers.
Sole-source award limits opportunities for other qualified vendors.
Firm-fixed-price contract may not adapt well to changing service needs.
Limited transparency into the justification for sole-source award.

Positive Signals

Ensures continued availability of critical medication management system.
Provides cost certainty through a firm-fixed-price agreement.
Supports the operational needs of the Department of Veterans Affairs.

Sector Analysis

The market for medical equipment maintenance and repair is diverse, with specialized providers for various types of equipment. This contract falls under the broader category of healthcare technology services. The NAICS code 811219 covers electronic and precision equipment repair and maintenance, indicating a niche service. Benchmarking spending in this specific sub-sector is challenging without more granular data on Pyxis PM system maintenance contracts.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information suggesting significant subcontracting opportunities for small businesses. The award to a specific solutions provider indicates a focus on specialized services that may not be readily available from smaller, generalist maintenance firms.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures would be tied to the terms of the purchase order and the performance of the contractor in maintaining the Pyxis PM system. Transparency is limited due to the sole-source nature of the award and the absence of publicly available justification documents.

Related Government Programs

Department of Veterans Affairs Medical Equipment Maintenance Contracts
Healthcare Technology Services Procurement
Pharmacy Automation System Maintenance

Risk Flags

Sole-source award raises concerns about fair pricing and competition.
Lack of transparency in the justification for sole-source procurement.
Potential for overpayment due to absence of competitive bidding.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $1.2 million to CAREFUSION SOLUTIONS, LLC. CAREFUSION PYXIS PM

Who is the contractor on this award?

The obligated recipient is CAREFUSION SOLUTIONS, 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 $1.2 million.

What is the period of performance?

Start: 2021-06-01. End: 2026-11-30.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT COMPETED' and is a 'SOLE SOURCE'. However, the specific justification for this sole-source determination is not detailed in the provided data. Typically, sole-source awards are justified when only one responsible source is available or capable of meeting the agency's needs. This could be due to proprietary technology, unique expertise, or urgent requirements where competition is not feasible. Without the official justification document, it's impossible to ascertain the precise reasons, but it implies a lack of readily available alternatives for servicing the CAREFUSION PYXIS PM system.

How does the awarded price compare to market rates for similar medical equipment maintenance services?

Benchmarking the awarded price of $1.24 million for the CAREFUSION PYXIS PM system maintenance against market rates is challenging with the provided data. The contract is for a specific product line (Pyxis PM) and covers a duration of approximately five years (June 2021 to November 2026). The NAICS code 811219 is broad. To perform a proper comparison, one would need data on other contracts for the maintenance of similar automated medication dispensing systems, considering factors like system size, features, number of units, and service level agreements. The sole-source nature of this award further complicates direct price comparison, as competitive pressures that typically align prices with market value were absent.

What are the potential risks associated with a sole-source award for critical medical equipment maintenance?

Sole-source awards for critical medical equipment maintenance carry several risks. Firstly, there's a significant risk of paying a premium price due to the lack of competition, as the contractor faces no pressure to offer the most cost-effective solution. Secondly, it can lead to vendor lock-in, making it difficult and potentially costly to switch providers in the future, even if better options emerge. Thirdly, there's a reduced incentive for the sole provider to innovate or improve service quality, as they are guaranteed the business. Finally, it limits opportunities for other qualified small or large businesses to compete for and win government contracts, potentially hindering market development and diversity.

What is the track record of CAREFUSION SOLUTIONS, LLC in providing similar services to the federal government?

The provided data identifies 'CAREFUSION SOLUTIONS, LLC' as the contractor. To assess their track record, one would need to examine their past performance on federal contracts, particularly those involving maintenance of medical equipment or similar systems. This would involve searching federal procurement databases (like SAM.gov or FPDS) for previous awards, contract performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or issues. Without access to this broader performance history, it's difficult to evaluate their reliability and effectiveness beyond this specific award.

How does this spending compare to historical VA spending on medication management systems maintenance?

The provided data offers a single contract award of $1.24 million for the CAREFUSION PYXIS PM system maintenance. To understand historical spending patterns, a broader analysis of the VA's procurement history for medication management systems, including Pyxis and similar technologies, would be necessary. This would involve aggregating spending data over multiple fiscal years and potentially across different VA facilities or regions. Comparing this $1.24 million award to the total historical spend would provide context on whether this represents a significant increase, decrease, or consistent level of investment in maintaining such critical systems.

Industry Classification

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

Solicitation ID: 36C24721Q0378

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Becton, Dickinson and CO

Address: 3750 TORREY VIEW COURT, SAN DIEGO, CA, 92130

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,240,515

Exercised Options: $1,240,515

Current Obligation: $1,240,515

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline