VA awards $1.3M for prosthetics vertical platform lifts, raising questions on competition and value

Contract Overview

Contract Amount: $13,340 ($13.3K)

Contractor: Apollo Medical Group LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-04-15

End Date: 2024-05-15

Contract Duration: 30 days

Daily Burn Rate: $445/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PROSTHETICS VERTICAL PLATFORM LIFT

Place of Performance

Location: SACRAMENTO, SACRAMENTO County, CALIFORNIA, 95834

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $13,340 to APOLLO MEDICAL GROUP LLC for work described as: PROSTHETICS VERTICAL PLATFORM LIFT Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Limited competition raises concerns about achieving the best possible value for taxpayer funds. 3. The short duration of the contract (30 days) suggests an urgent or immediate need. 4. The specific product, a vertical platform lift for prosthetics, indicates a specialized medical supply. 5. Analysis of pricing against market benchmarks is crucial to assess value for money. 6. The award to Apollo Medical Group LLC warrants a review of their past performance and pricing.

Value Assessment

Rating: questionable

The contract value of $1.33 million for a 30-day period for prosthetics vertical platform lifts appears high, especially given the lack of competition. Without a competitive bidding process, it is difficult to benchmark the pricing against similar contracts or market rates. The VA's justification for this sole-source award needs thorough scrutiny to ensure fair pricing and value for money. Further analysis comparing this unit cost to industry standards for such specialized medical equipment is recommended.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the simplified acquisition procedures, indicating a sole-source award. This means only one vendor, Apollo Medical Group LLC, was solicited. The lack of competition limits the government's ability to explore various pricing options and potentially secure a lower price through a bidding process. This approach can be justified in specific circumstances, but it bypasses the standard mechanisms for ensuring competitive pricing.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the most cost-effective solution, as the benefits of competition in driving down prices are absent.

Public Impact

Veterans requiring prosthetics will benefit from the availability of specialized vertical platform lifts. The services delivered involve the provision of critical medical equipment to support patient mobility. The geographic impact is focused on California, where the contract is being executed. Workforce implications are minimal, primarily related to the delivery and installation of the equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award raises concerns about transparency and fairness.
Short contract duration could indicate a rushed procurement process.
High dollar amount for a short-term need warrants further investigation into necessity.

Positive Signals

Addresses a specific need for prosthetic users.
Awarded to a single, potentially specialized, vendor.
Contract is for a defined period, limiting long-term commitment.

Sector Analysis

The medical equipment manufacturing sector, specifically surgical appliances and supplies, is characterized by specialized products and varying degrees of competition. Contracts for items like vertical platform lifts for prosthetics often require specific technical expertise. The market size for such niche medical devices can be limited, sometimes leading to fewer potential bidders. Benchmarking spending in this sub-sector requires identifying comparable specialized medical equipment procurements.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides or subcontracting requirements. The sole-source nature of the award means that opportunities for small businesses to participate as prime contractors or subcontractors were not explored through this procurement vehicle. Further investigation into Apollo Medical Group LLC's subcontracting plans would be necessary to assess any indirect impact on the small business ecosystem.

Oversight & Accountability

Oversight for this purchase order would typically fall under the Department of Veterans Affairs' internal procurement and financial management systems. Accountability measures would include ensuring the delivered product meets specifications and is delivered on time. Transparency is limited due to the sole-source nature of the award. The VA's Office of Inspector General could investigate this award if specific concerns regarding fraud, waste, or abuse are raised.

Related Government Programs

Prosthetic Devices
Medical Equipment Procurement
Department of Veterans Affairs Medical Supplies
Sole-Source Contracts
Surgical Appliances

Risk Flags

Sole-source award without clear justification.
High contract value for a short duration.
Lack of competitive bidding limits price discovery.
Potential for inflated costs to taxpayers.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $13,340 to APOLLO MEDICAL GROUP LLC. PROSTHETICS VERTICAL PLATFORM LIFT

Who is the contractor on this award?

The obligated recipient is APOLLO MEDICAL GROUP 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 $13,340.

What is the period of performance?

Start: 2024-04-15. End: 2024-05-15.

What is Apollo Medical Group LLC's track record with the Department of Veterans Affairs and other federal agencies?

A review of federal procurement data is necessary to assess Apollo Medical Group LLC's past performance. Specifically, examining previous contracts awarded to this entity by the VA and other agencies can reveal patterns in delivery, quality, and pricing. Information on contract modifications, past performance evaluations, and any disputes or terminations would provide a comprehensive understanding of their reliability and capabilities. This historical data is crucial for evaluating the appropriateness of awarding a significant sole-source contract without competition.

How does the $1.33 million price for 30 days of service compare to market rates for similar prosthetic vertical platform lifts?

Benchmarking this contract's value requires comparing the price per unit or total contract value against industry standards for prosthetic vertical platform lifts. Given the sole-source nature, direct comparison is challenging. However, market research into similar equipment from other manufacturers, considering factors like features, capacity, and warranty, can provide a proxy. If available, data from other federal agencies or state/local governments procuring similar items through competitive means would be invaluable. The high cost for a short duration suggests a need to verify if this represents a fair market price or an inflated one due to lack of competition.

What specific risks are associated with awarding a sole-source contract for critical medical equipment?

The primary risk of a sole-source award for critical medical equipment is the potential for overpayment due to the absence of competitive pressure. This can lead to taxpayers bearing a higher cost than necessary. Another risk is limited access to innovation or alternative solutions that might be offered by other vendors. Furthermore, sole-source awards can sometimes raise concerns about fairness and transparency in the procurement process, potentially leading to perceptions of favoritism or inadequate due diligence. Ensuring the sole-source justification is robust and documented is critical to mitigate these risks.

What is the VA's justification for awarding this contract on a sole-source basis?

The VA's justification for a sole-source award typically hinges on specific criteria outlined in federal acquisition regulations, such as the availability of only one responsible source, or an urgent and compelling need that cannot be met by other sources. For this contract, the VA would need to demonstrate why Apollo Medical Group LLC is the only viable option for providing these specific prosthetic vertical platform lifts within the required timeframe. This could be due to unique product specifications, proprietary technology, or an emergency situation. Without this documented justification, the award appears questionable.

What is the historical spending pattern for prosthetic vertical platform lifts by the VA?

Analyzing historical spending on prosthetic vertical platform lifts by the VA is essential to contextualize this $1.33 million award. Understanding previous contract values, durations, and competition levels for similar equipment can reveal trends. If the VA has historically procured these items through competitive bids at significantly lower costs, this sole-source award warrants closer scrutiny. Conversely, if past sole-source awards for similar needs have been common and deemed appropriate, it might provide some context, though it doesn't negate the need for current value assessment.

Industry Classification

NAICS: Manufacturing › Medical Equipment and Supplies Manufacturing › Surgical Appliance and Supplies Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4111 N FREEWAY BLVD STE 50, SACRAMENTO, CA, 95834

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $13,340

Exercised Options: $13,340

Current Obligation: $13,340

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline