VA awards $5.2M pharmacy services contract to Home Care Advantage Inc. for Utah region

Contract Overview

Contract Amount: $5,220,173 ($5.2M)

Contractor: Home Care Advantage Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-03-01

End Date: 2027-02-28

Contract Duration: 1,094 days

Daily Burn Rate: $4.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PHARMACY SERVICES

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84148

State: Utah Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $5.2 million to HOME CARE ADVANTAGE INC for work described as: PHARMACY SERVICES Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1094 days indicates a medium-term commitment for pharmacy services. 3. Fixed-price contract type suggests predictable costs for the government, assuming scope is well-defined. 4. The award to a single vendor, Home Care Advantage Inc., warrants scrutiny for potential future competition. 5. Geographic focus on Utah may indicate a localized need for these pharmacy services. 6. The North American Industry Classification System (NAICS) code 561320 points to temporary health care services, which may include pharmacy support staff or related functions.

Value Assessment

Rating: fair

The contract value of approximately $5.2 million over three years averages to about $1.74 million annually. Without specific benchmarks for pharmacy services of this nature, a direct value-for-money assessment is challenging. However, the fixed-price structure provides cost certainty. Comparison to similar VA or other federal contracts for pharmacy support services in the region would be necessary for a more robust valuation. The absence of detailed performance metrics in the provided data limits a deeper assessment of efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The data shows 4 offers were received. This level of competition is generally positive for price discovery and ensuring the government receives competitive pricing. The specific details of the bidding process and the evaluation criteria used are not provided, but the presence of multiple bids suggests a healthy market for these services.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces. The receipt of multiple bids suggests that the government likely secured a fair price for the pharmacy services, avoiding potential overpayment associated with less competitive solicitations.

Public Impact

Veterans in the Utah region are the primary beneficiaries, gaining access to essential pharmacy services. The contract ensures the provision of pharmacy-related support, potentially including medication dispensing, management, or related administrative functions. The geographic impact is concentrated within Utah, serving the specific needs of the veteran population in that state. Workforce implications may include the employment of pharmacy technicians, pharmacists, or administrative staff by the contractor to fulfill the service requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if competition diminishes in future solicitations.
Reliance on a single vendor for critical pharmacy services could pose a risk if the contractor experiences performance issues or financial instability.

Positive Signals

Awarded through full and open competition, indicating a competitive marketplace.
Fixed-price contract type provides cost predictability for the agency.
The contract duration suggests a stable, ongoing need for these services.

Sector Analysis

The healthcare sector, particularly within government contracting, is characterized by significant spending on pharmaceuticals and related services. This contract falls under the broader category of healthcare support services. The market for pharmacy services is competitive, with numerous providers ranging from large retail chains to specialized healthcare support firms. Benchmarking this contract's value would require comparing its per-unit costs or overall price against similar contracts awarded by the VA or other federal agencies for comparable services in different geographic regions.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While this contract was awarded under full and open competition, there is no explicit information regarding subcontracting opportunities for small businesses. The impact on the small business ecosystem is therefore neutral to unknown without further details on subcontracting plans or the contractor's history with small business engagement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs (VA). The VA typically has established procurement oversight mechanisms, including contract officers, program managers, and potentially an Office of Inspector General (OIG) that can investigate fraud, waste, and abuse. Transparency is facilitated through contract award databases like FPDS. Accountability measures would be tied to the contract's performance work statement and terms, with potential remedies for non-compliance.

Related Government Programs

VA Pharmacy Benefits Management
Medical and Surgical Supplies
Healthcare Staffing Services
Veterans Health Administration Services

Risk Flags

Potential for limited future competition due to single-award nature.
Reliance on contractor's ability to maintain quality under fixed-price terms.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $5.2 million to HOME CARE ADVANTAGE INC. PHARMACY SERVICES

Who is the contractor on this award?

The obligated recipient is HOME CARE ADVANTAGE 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 $5.2 million.

What is the period of performance?

Start: 2024-03-01. End: 2027-02-28.

What is the historical spending pattern for pharmacy services by the Department of Veterans Affairs in Utah?

Analyzing historical spending patterns for pharmacy services by the Department of Veterans Affairs (VA) in Utah is crucial for context. While specific historical data for this exact contract or vendor is not provided, the VA generally has a substantial and consistent need for pharmacy services across its network. Spending in this area can fluctuate based on veteran population growth, changes in healthcare policy, and the introduction of new pharmaceuticals. Examining prior contract awards for similar services in the Utah region, including the number of bidders, award values, and contract durations, would reveal trends in pricing, competition, and vendor performance. This historical perspective helps in assessing whether the current $5.2 million award represents a reasonable increase or decrease compared to past expenditures, considering inflation and market dynamics.

How does the per-unit cost of services under this contract compare to industry benchmarks for temporary health care staffing?

A direct comparison of per-unit costs for this contract against industry benchmarks for temporary health care staffing is challenging without specific details on the services rendered. The NAICS code 561320 covers a broad range of temporary health care services, which could include anything from administrative support to specialized clinical roles. To perform a meaningful benchmark, we would need to know the specific roles being filled (e.g., number of pharmacists, pharmacy technicians, hours worked), their associated pay rates, and the contractor's overhead and profit margins. If the contract involves direct patient care or dispensing, benchmarks from healthcare staffing agencies specializing in pharmacy personnel would be relevant. Without this granular data, assessing the value-for-money based on per-unit cost remains speculative, though the fixed-price nature provides some cost control.

What is Home Care Advantage Inc.'s track record with federal contracts, particularly with the Department of Veterans Affairs?

Evaluating Home Care Advantage Inc.'s track record with federal contracts, especially with the Department of Veterans Affairs (VA), is essential for assessing performance risk. Information from contract databases like the Federal Procurement Data System (FPDS) would reveal the company's history of awards, contract types, values, and agencies served. Key indicators include the number of past contracts, their duration, any instances of contract terminations, modifications, or disputes, and performance reviews if publicly available. A history of successful contract completion with the VA suggests reliability and competence. Conversely, a record marked by issues could indicate potential risks for this new award. Understanding their experience specifically with pharmacy-related services, rather than general temporary staffing, would provide further insight into their suitability for this particular contract.

What are the potential risks associated with a fixed-price contract for pharmacy services, and how are they mitigated?

Fixed-price contracts, while offering cost certainty, carry inherent risks for both the government and the contractor, particularly in service-based agreements like pharmacy operations. For the government, the primary risk is that the contractor may cut corners on quality or service delivery to maximize profit if the fixed price proves too low for the scope of work. Conversely, if the fixed price is too high, taxpayers may overpay. For the contractor, the risk lies in underestimating the effort required, leading to financial losses. Mitigation strategies include a clearly defined Performance Work Statement (PWS) detailing all required services, service level agreements (SLAs), and quality assurance surveillance plans (QASP). The VA's oversight, including regular performance reviews and potential penalties for non-compliance, helps ensure the contractor meets obligations. Robust initial cost estimation and market research by the government are also critical to setting a fair and appropriate fixed price.

How does the geographic concentration in Utah impact the overall effectiveness and cost-efficiency of this pharmacy services contract?

The geographic concentration of this pharmacy services contract in Utah has several implications for effectiveness and cost-efficiency. On the positive side, focusing on a specific region allows for tailored service delivery, potentially improving responsiveness and understanding of local veteran needs. It can also lead to efficiencies in logistics and management by concentrating resources. However, it also presents risks. If the contractor's operational capacity within Utah is limited, or if unforeseen local challenges arise (e.g., staffing shortages, regulatory changes), service delivery could be impacted. From a cost perspective, a localized contract might benefit from reduced travel and overhead compared to a nationwide award. However, it could also limit competition if only a few local providers are capable, potentially leading to higher prices than if the contract were competed more broadly. The VA's decision to award regionally suggests a belief that localized management offers advantages for this specific requirement.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Employment Services › Temporary Help Services

Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1179 SOUTH SIXTH STREET, INDIANA, PA, 15701

Business Categories: Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $10,987,004

Exercised Options: $5,220,173

Current Obligation: $5,220,173

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36F79721D0060

IDV Type: FSS

Timeline