VA awards $2.6M lease for medical scopes with service maintenance to Olympus America Inc

Contract Overview

Contract Amount: $2,611,709 ($2.6M)

Contractor: Olympus America 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: $2.4K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MEDICAL SCOPE LEASE W/ SERVICE MAINTENANCE

Place of Performance

Location: LOMA LINDA, SAN BERNARDINO County, CALIFORNIA, 92357

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.6 million to OLYMPUS AMERICA INC for work described as: MEDICAL SCOPE LEASE W/ SERVICE MAINTENANCE Key points: 1. The contract is for medical scope leasing and maintenance, a recurring need for healthcare providers. 2. Olympus America Inc. is a significant player in the medical device market, suggesting potential competition. 3. The contract value is moderate, but the long-term service component warrants attention. 4. Spending is within the healthcare sector, specifically for medical equipment.

Value Assessment

Rating: good

The contract value of $2.6M over approximately three years appears reasonable for specialized medical equipment leasing and maintenance. Benchmarking against similar long-term service agreements for high-value medical devices would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under SAP (Simplified Acquisition Procedures) via a BPA Call. While SAP aims for efficiency, it may limit the breadth of competition compared to full and open solicitations, potentially impacting price discovery.

Taxpayer Impact: The use of SAP suggests an effort to streamline procurement for this moderate-value contract, aiming for cost-effectiveness while ensuring necessary equipment is acquired.

Public Impact

Ensures VA facilities have access to up-to-date medical scoping technology. Supports diagnostic and procedural capabilities for veteran healthcare. Maintains operational readiness of critical medical equipment through service contracts. Potential for improved patient outcomes due to advanced equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition due to SAP and BPA Call.
Reliance on a single vendor for service maintenance.
Potential for price creep in future renewals.

Positive Signals

Addresses a critical healthcare need for veterans.
Utilizes a streamlined acquisition process.
Includes essential service maintenance to ensure equipment uptime.

Sector Analysis

This contract falls within the healthcare sector, specifically for electromedical apparatus. Spending on medical equipment and maintenance is a significant component of healthcare budgets, driven by technological advancements and the need for reliable patient care.

Small Business Impact

The data indicates this contract was awarded to Olympus America Inc., a large corporation. There is no explicit indication of small business participation in this specific award, suggesting opportunities may lie in subcontracting or future, differently structured procurements.

Oversight & Accountability

The contract was awarded by the Department of Veterans Affairs, which has established oversight mechanisms for procurement. The use of a BPA Call suggests adherence to specific agency procedures for this type of acquisition.

Related Government Programs

Electromedical and Electrotherapeutic Apparatus Manufacturing
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Potential for limited competition.
Vendor lock-in for service maintenance.
Lack of transparency on service cost escalation.
Absence of explicit small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.6 million to OLYMPUS AMERICA INC. MEDICAL SCOPE LEASE W/ SERVICE MAINTENANCE

Who is the contractor on this award?

The obligated recipient is OLYMPUS AMERICA 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 $2.6 million.

What is the period of performance?

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

What is the total cost of ownership over the contract's lifespan, including potential service escalations?

The total obligated amount is $2,611,709.43 over 1094 days. To assess the total cost of ownership, one would need to factor in any potential price adjustments for service maintenance, especially if the contract allows for annual escalations. Without explicit terms on service cost increases, the current value represents the base lease and initial maintenance.

What are the key performance indicators (KPIs) for the service maintenance component, and how are they monitored?

The provided data does not detail the specific Key Performance Indicators (KPIs) for the service maintenance. Effective oversight would require clear metrics such as response times for service calls, equipment uptime guarantees, and quality of repairs. The VA's contract management team should be actively monitoring these KPIs to ensure Olympus America Inc. meets its service obligations.

How does the cost of this lease and maintenance package compare to purchasing the equipment outright and securing separate maintenance contracts?

A direct comparison requires detailed cost data for outright purchase and separate maintenance agreements for comparable equipment. Leasing offers advantages like lower upfront costs and potentially easier technology refreshes. However, over the long term, purchasing might be more cost-effective. A thorough analysis would involve calculating the net present value of both options.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Electromedical and Electrotherapeutic Apparatus Manufacturing

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3500 CORPORATE PKWY, CENTER VALLEY, PA, 18034

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

Financial Breakdown

Contract Ceiling: $4,358,119

Exercised Options: $4,358,119

Current Obligation: $2,611,709

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36C26219A0033

IDV Type: BPA

Timeline