VA awards $4.76M for Siemens medical equipment services, with competition driving value

Contract Overview

Contract Amount: $4,763,582 ($4.8M)

Contractor: Siemens Medical Solutions USA, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2020-04-01

End Date: 2026-03-10

Contract Duration: 2,169 days

Daily Burn Rate: $2.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: SIEMENS SERVICE CONTRACT

Place of Performance

Location: HOUSTON, HARRIS County, TEXAS, 77030

State: Texas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $4.8 million to SIEMENS MEDICAL SOLUTIONS USA, INC. for work described as: SIEMENS SERVICE CONTRACT Key points: 1. Contract value of $4.76M over 6 years suggests a moderate annual spend. 2. Full and open competition indicates a healthy market for these services. 3. Fixed-price contract type helps mitigate cost overrun risks. 4. The contract supports essential medical equipment maintenance for veterans. 5. Siemens, a major player, likely offers competitive pricing due to market presence. 6. Performance period of nearly 6 years allows for stable service delivery.

Value Assessment

Rating: good

The contract value of $4.76M over approximately 6 years translates to an annual spend of roughly $800K. Benchmarking this against similar service contracts for complex medical equipment is challenging without more specific details on the exact equipment and services. However, the fixed-price nature of the contract suggests an effort to control costs. The competition level, being full and open, implies that the pricing is likely to be market-driven and represent fair value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. The data does not specify the number of bidders, but this procurement method generally fosters a competitive environment. A competitive process is expected to lead to more favorable pricing and better service terms for the government compared to sole-source or limited competition awards.

Taxpayer Impact: Taxpayers benefit from a competitive process that is designed to secure the best possible price and quality for the services rendered, preventing potential overpayment that could occur in less competitive scenarios.

Public Impact

Veterans receiving care at VA facilities will benefit from reliable access to functioning medical equipment. The contract ensures the maintenance and service of critical irradiation apparatus, vital for various medical treatments. Services are likely delivered within VA facilities in Texas, given the state code (ST: TX). This contract supports specialized technical roles for maintaining advanced medical equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if service requirements become highly specialized to Siemens equipment.
Reliance on a single contractor for critical equipment maintenance could pose a risk if performance falters.

Positive Signals

Full and open competition suggests a robust market and potential for competitive pricing.
Fixed-price contract type provides cost certainty for the government.
Long performance period allows for consistent service and relationship building.

Sector Analysis

This contract falls within the broader healthcare sector, specifically focusing on the manufacturing and servicing of medical equipment, categorized under NAICS code 334517 (Irradiation Apparatus Manufacturing). The market for medical equipment maintenance is substantial, driven by the increasing complexity and cost of healthcare technology. Siemens is a significant global player in this market, offering a wide range of medical solutions. This contract represents a portion of the VA's overall spending on maintaining its medical technology infrastructure.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (SB: false) and there is no information provided regarding small business subcontracting plans (SS: false). Therefore, this contract does not appear to directly benefit small businesses through set-asides. The primary contractor is a large corporation, and the focus is on specialized services for complex medical equipment, which may limit opportunities for broad subcontracting to small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs contracting officers and program managers. The fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally facilitated through contract databases like FPDS. Specific accountability measures would be detailed in the contract's performance work statement, with potential for Inspector General review if performance issues or fraud are suspected.

Related Government Programs

VA Medical Equipment Maintenance Contracts
Siemens Healthcare Services
Medical Device Manufacturing and Servicing
Federal Healthcare Technology Procurement

Risk Flags

Potential for vendor lock-in
Reliance on single supplier for critical equipment

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $4.8 million to SIEMENS MEDICAL SOLUTIONS USA, INC.. SIEMENS SERVICE CONTRACT

Who is the contractor on this award?

The obligated recipient is SIEMENS MEDICAL SOLUTIONS 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 $4.8 million.

What is the period of performance?

Start: 2020-04-01. End: 2026-03-10.

What is the historical spending trend for Siemens medical equipment services at the VA?

Analyzing historical spending requires access to detailed procurement data over multiple fiscal years. Without that specific data, it's difficult to establish a trend. However, the current award of $4.76M over approximately 6 years indicates a consistent need for these services. If the VA has previously contracted with Siemens for similar equipment, one might expect a pattern of recurring awards, potentially fluctuating based on equipment lifecycle, upgrades, and budget allocations. A deeper dive into past contracts with Siemens for irradiation apparatus or similar medical equipment would reveal if this award represents an increase, decrease, or stable level of spending.

How does the per-unit cost of service for this contract compare to industry benchmarks?

Determining a precise per-unit cost benchmark is challenging without knowing the specific type and quantity of irradiation apparatus being serviced, as well as the scope of services included (e.g., preventative maintenance, repairs, parts). The contract is a Delivery Order under a larger contract vehicle, and the total value is $4.76M. If we assume the 2169 days duration is the primary unit, the daily cost is approximately $2,194. However, this is not a true 'per-unit' cost in the sense of a single piece of equipment. To benchmark effectively, one would need to compare the hourly rates, travel costs, and parts markups against similar service agreements from competitors like GE Healthcare, Philips, or Varian Medical Systems, considering the specific equipment models and service level agreements.

What are the key performance indicators (KPIs) for this contract, and how is Siemens' performance being measured?

The specific Key Performance Indicators (KPIs) for this Siemens service contract are not detailed in the provided data. However, typical KPIs for such contracts often include response times for service calls (both emergency and routine), equipment uptime percentages, completion rates for preventative maintenance schedules, and customer satisfaction scores. The Department of Veterans Affairs would likely have a Performance Work Statement (PWS) outlining these requirements. Performance would be monitored by VA technical points of contact and contracting officers, with potential for award fee adjustments or penalties based on meeting or failing to meet these KPIs.

What is the risk associated with relying on a single vendor, Siemens, for critical medical equipment maintenance?

The primary risk of relying on a single vendor like Siemens for critical medical equipment maintenance is potential vendor lock-in and reduced leverage in future negotiations. If Siemens is the sole provider of parts and specialized technicians for this specific irradiation apparatus, the VA may face higher costs or longer wait times if issues arise. Furthermore, if Siemens experiences financial difficulties or decides to exit a particular market segment, the VA could be left without adequate support. Mitigating this risk often involves robust contract management, clear performance expectations, and potentially exploring multi-vendor strategies for future procurements where feasible.

What is the anticipated impact of this contract on veteran healthcare outcomes?

This contract is expected to have a positive impact on veteran healthcare outcomes by ensuring the reliable operation of critical medical equipment, specifically irradiation apparatus. This equipment is likely used in various treatment modalities, such as radiation therapy for cancer or sterilization processes. By guaranteeing timely maintenance and repair services, the contract helps minimize equipment downtime, ensuring that veterans can receive necessary treatments without undue delays. Consistent equipment availability and performance are crucial for delivering high-quality, effective healthcare services to the veteran population.

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

Parent Company: Altair Engineering Inc.

Address: 40 LIBERTY BLVD, MALVERN, PA, 19355

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $4,763,582

Exercised Options: $4,763,582

Current Obligation: $4,763,582

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE2D117D0023

IDV Type: IDC

Timeline