VA awards $230K for skilled nursing care, but competition details are limited

Contract Overview

Contract Amount: $229,983 ($230.0K)

Contractor: Ridgecrest Community Healthcare, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-02-01

End Date: 2026-02-07

Contract Duration: 6 days

Daily Burn Rate: $38.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Healthcare

Official Description: EXPRESS REPORT: FY 26 FEB 1-7 STATION 644

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85032

State: Arizona Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $229,983.2 to RIDGECREST COMMUNITY HEALTHCARE, LLC for work described as: EXPRESS REPORT: FY 26 FEB 1-7 STATION 644 Key points: 1. The contract value of $230K for a 6-day period suggests a high daily rate for services. 2. Limited competition raises concerns about potential overpayment and lack of market-driven pricing. 3. The short duration of the contract may indicate a need for immediate or temporary care solutions. 4. The fixed-price with economic price adjustment structure introduces potential for cost escalation. 5. The specific need for nursing care facilities points to a critical healthcare requirement for veterans. 6. The contract's focus on Arizona aligns with regional veteran population needs.

Value Assessment

Rating: questionable

The contract awarded to RIDGECREST COMMUNITY HEALTHCARE, LLC for $229,983.20 over 6 days represents a daily rate of approximately $38,331. This rate appears exceptionally high when compared to typical per diem rates for skilled nursing facilities, which often range from a few hundred to a couple of thousand dollars per day, depending on the level of care and location. Without further context on the specific services provided and the patient acuity, it is difficult to definitively benchmark, but the initial figures suggest a significant premium. The lack of competition exacerbates concerns about whether this price reflects fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'NOT COMPETED,' indicating a sole-source or limited competition procurement. The data does not specify the reason for this approach, such as an emergency or a unique capability. The absence of a competitive bidding process means there was no opportunity for multiple vendors to offer their services, which typically drives down prices and encourages innovation. This lack of competition limits the government's ability to ensure it is receiving the best possible value for taxpayer dollars.

Taxpayer Impact: Taxpayers may be paying a higher price due to the absence of competitive pressure. Without bids from other providers, the government cannot be certain it secured the most cost-effective solution for these essential nursing care services.

Public Impact

Veterans in Arizona requiring skilled nursing care are the primary beneficiaries of this contract. The contract ensures the provision of essential nursing care services for a short-term period. The geographic impact is localized to Arizona, serving veterans within the state. The contract supports the healthcare workforce employed by RIDGECREST COMMUNITY HEALTHCARE, LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High daily cost raises concerns about value for money.
Lack of competition limits price discovery and potential savings.
Fixed Price with Economic Price Adjustment (FPEPA) contract type can lead to cost overruns.
Short contract duration (6 days) may indicate urgent or temporary needs, potentially at a premium.

Positive Signals

Ensures critical nursing care is provided to veterans.
Contract is awarded to a specific healthcare provider, potentially meeting a specialized need.
Focus on a specific geographic region (Arizona) targets service delivery effectively.

Sector Analysis

The healthcare sector, specifically skilled nursing facilities, is a critical component of the U.S. healthcare system, providing long-term care for individuals with complex medical needs. Federal spending in this area, particularly through the Department of Veterans Affairs (VA), is substantial, aimed at supporting veterans' health. This contract, though small in total dollar amount and duration, fits within the broader VA mission to provide comprehensive healthcare. Benchmarking this specific contract is challenging due to its unique characteristics, but overall federal spending on healthcare services for veterans is in the billions annually.

Small Business Impact

The provided data indicates that this contract was not competed and does not specify any small business set-aside provisions (ss: false, sb: false). Therefore, there is no direct analysis of small business participation or subcontracting opportunities related to this specific award. The absence of a competitive process limits the potential for small businesses to engage with this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs (VA). As a delivery order under a larger contract vehicle (though the base contract type is not specified), oversight would involve monitoring performance against the terms of the award, ensuring quality of care, and managing payments. Transparency is limited due to the sole-source nature of the award and the short duration. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

VA Medical Care
Skilled Nursing Facility Services
Veteran Healthcare Services
Long-Term Care Contracts

Risk Flags

High Unit Cost
Lack of Competition
Potential for Cost Overruns (FPEPA)
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $229,983.2 to RIDGECREST COMMUNITY HEALTHCARE, LLC. EXPRESS REPORT: FY 26 FEB 1-7 STATION 644

Who is the contractor on this award?

The obligated recipient is RIDGECREST COMMUNITY HEALTHCARE, 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 $229,983.2.

What is the period of performance?

Start: 2026-02-01. End: 2026-02-07.

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

The provided data indicates the contract was 'NOT COMPETED' (ct: NOT COMPETED), classifying it as a sole-source or limited competition award. However, the specific justification for this determination is not included in the Express Report. Typically, sole-source awards are made under specific circumstances, such as when only one vendor can provide the required service (e.g., unique capability, proprietary technology), in cases of urgent and compelling need where competition is impractical, or when the contract value falls below certain thresholds for simplified acquisition procedures that may allow for limited competition. Without further documentation from the Department of Veterans Affairs, the precise reason for bypassing full and open competition remains unknown.

How does the daily rate of approximately $38,331 compare to market benchmarks for skilled nursing facilities?

The daily rate derived from this contract is approximately $38,331 ($229,983.20 / 6 days). This figure appears exceptionally high when benchmarked against typical per diem rates for skilled nursing facilities (SNFs). National averages for SNF care can range widely, but generally fall between $200 and $1,000 per day, with higher rates in specific high-cost-of-living areas or for highly specialized care. Even considering potential factors like intensive medical services, 24/7 staffing, and specialized equipment, a daily rate of $38,331 is orders of magnitude higher than standard market rates. This suggests either a highly unique and intensive level of care not typical for SNFs, or a significant potential for overpayment due to the lack of competitive bidding.

What are the potential risks associated with a Fixed Price with Economic Price Adjustment (FPEPA) contract for short-term nursing care?

A Fixed Price with Economic Price Adjustment (FPEPA) contract, while offering some protection against inflation for the contractor, introduces risks for the government, especially in a short-term scenario like this 6-day contract. The 'economic price adjustment' clause allows the contract price to be modified based on fluctuations in specific economic factors (e.g., labor costs, material costs). For a short duration, the potential for significant economic shifts impacting the price is lower, but it still opens the door for price increases beyond the initial fixed amount. The primary risk is that the government might end up paying more than initially anticipated if the economic indicators trigger an upward adjustment, without a corresponding increase in the value or scope of services provided. This is particularly concerning when coupled with a lack of competition, as the baseline price may not have been optimized.

What is the significance of the contract being a 'Delivery Order'?

The designation 'DELIVERY ORDER' (aw: DELIVERY ORDER) indicates that this contract is likely a task order or delivery order issued against a pre-existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar type of basic ordering agreement (BOA). IDIQ contracts establish terms and conditions for future purchases, allowing agencies to issue orders as needed. This approach can streamline the procurement process for recurring needs. However, the 'NOT COMPETED' status applies to this specific delivery order, meaning that even if the underlying IDIQ contract was competed, this particular order was not. This still raises questions about the competition for this specific service requirement and its associated pricing.

What does the short duration (6 days) imply about the nature of the nursing care required?

The extremely short duration of this contract (6 days, from 2026-02-01 to 2026-02-07) suggests that the nursing care required was likely for a very specific, short-term need. This could include covering an immediate gap in services, providing specialized care for a brief period, managing a temporary surge in patient needs, or fulfilling a critical requirement while a longer-term solution is being established. Such short-term, urgent needs can sometimes necessitate sole-source awards due to time constraints, but they also often come at a premium price compared to longer-term, planned service contracts. The high daily rate further supports the idea that this was a time-sensitive or specialized requirement.

Industry Classification

NAICS: Health Care and Social Assistance › Nursing Care Facilities (Skilled Nursing Facilities) › Nursing Care Facilities (Skilled Nursing Facilities)

Product/Service Code: MEDICAL SERVICES › NURSING, NURSING HOME, EVAL/SCREEN

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 16640 N 38TH ST, PHOENIX, AZ, 85032

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $229,983

Exercised Options: $229,983

Current Obligation: $229,983

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C26226D0040

IDV Type: IDC

Timeline