VA awards $230K for skilled nursing care in Arizona, bypassing competition

Contract Overview

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

Contractor: Ridgecrest Community Healthcare, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-02-15

End Date: 2026-02-21

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: FY26 FEB 15-21 STATION 644

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85012

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: FY26 FEB 15-21 STATION 644 Key points: 1. The contract value represents a small portion of the VA's overall healthcare spending. 2. The short duration of the contract (6 days) suggests a specific, immediate need. 3. The use of Fixed Price with Economic Price Adjustment indicates potential for cost fluctuations. 4. The lack of competition raises questions about potential overpayment and limited market engagement. 5. The specific need for nursing care facilities aligns with the VA's mission to support veterans. 6. The contract's geographic focus is limited to Arizona.

Value Assessment

Rating: questionable

The contract value of $229,983.20 for a 6-day period of nursing care is difficult to benchmark without more context on the specific services and patient needs. However, the per-day cost appears high. Given the lack of competition, it's challenging to assess if this represents fair market value. The economic price adjustment clause also introduces uncertainty regarding the final cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required goods or services, or in urgent situations. The lack of competition limits the government's ability to explore alternative solutions or negotiate the best possible price.

Taxpayer Impact: Taxpayers may not be receiving the best value due to the absence of competitive bidding, potentially leading to higher costs than if multiple offers had been considered.

Public Impact

Veterans in Arizona requiring skilled nursing care will benefit from this contract. The services delivered are nursing care within a skilled nursing facility setting. The geographic impact is concentrated in Arizona. The contract supports the healthcare workforce within the nursing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Economic price adjustment introduces cost uncertainty.
Short contract duration may indicate reactive rather than strategic procurement.
Limited transparency due to sole-source award.

Positive Signals

Addresses a specific healthcare need for veterans.
Contract awarded to a known entity (RIDGECREST COMMUNITY HEALTHCARE, LLC).
Clear service category (Nursing Care Facilities).

Sector Analysis

The healthcare sector, specifically skilled nursing facilities, is a critical component of the broader healthcare industry. This contract falls under the subsector of long-term care and post-acute services. Spending in this area is driven by the healthcare needs of specific populations, including veterans. Benchmarking this contract is difficult without comparable data on per-diem rates for similar VA contracts or private sector facilities in Arizona.

Small Business Impact

This contract was not competed and there is no indication of a small business set-aside. Therefore, it does not appear to directly benefit small businesses through this specific award. Subcontracting opportunities are not specified, and the impact on the broader small business ecosystem is likely minimal for this particular contract.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' internal procurement and program management offices. Accountability measures would be tied to the delivery of nursing care services as per the contract terms. Transparency is limited due to the sole-source nature of the award, and Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

VA Medical Services Contracts
Skilled Nursing Facility Services
Veteran Healthcare Services

Risk Flags

Lack of Competition
Potential for Overpricing
Cost Uncertainty due to EPA

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: FY26 FEB 15-21 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: 2026-02-15. End: 2026-02-21.

What is the typical cost per day for skilled nursing care provided by the VA or similar facilities in Arizona?

Determining a precise 'typical' cost per day for skilled nursing care is complex, as rates vary significantly based on the level of care required, geographic location, facility type (e.g., VA-owned vs. community partner), and specific services included. For VA contracts, per diem rates can range widely. Community-based nursing homes often charge between $300-$600 per day, with higher rates for specialized care or in high-cost-of-living areas. Without specific details on the patient acuity and services provided under this $229,983.20 contract for a 6-day period, a direct comparison is challenging. However, if this contract covers a standard level of care for a small number of patients, the implied daily rate could be substantial, warranting scrutiny, especially given the sole-source award.

Why was this contract awarded on a sole-source basis instead of being competed?

The provided data indicates the contract was 'NOT COMPETED' and awarded as a 'sole-source'. This typically occurs when the contracting agency, in this case, the Department of Veterans Affairs (VA), determines that only one responsible source is available to meet the requirement. Reasons for sole-source awards can include urgent and compelling needs where delay would cause significant financial or operational damage, situations where only one vendor possesses unique capabilities or proprietary technology, or when a specific small business set-aside is not feasible. For this contract, the VA would need to justify why competition was not practicable, especially given the relatively short duration, which might suggest a specific, immediate need that could have potentially been met by multiple qualified providers if planned for.

What are the potential risks associated with a sole-source contract for nursing care?

Sole-source contracts for nursing care present several potential risks. Firstly, the absence of competition can lead to higher prices than might be achieved through a competitive bidding process, as the contractor faces less pressure to offer the most cost-effective solution. Secondly, it limits the VA's ability to explore a wider range of providers and potentially discover more innovative or specialized care options. Thirdly, without comparative bids, assessing the 'value for money' becomes more difficult, potentially leading to suboptimal resource allocation. Finally, sole-source awards can sometimes raise concerns about fairness and transparency in the procurement process, even if legally justified.

How does the 'Fixed Price with Economic Price Adjustment' (FP/EPA) clause impact the final cost and risk for the VA?

The 'Fixed Price with Economic Price Adjustment' (FP/EPA) contract type means that the base price is fixed, but it can be adjusted upwards (or sometimes downwards) based on specified economic factors, such as changes in labor costs, material costs, or inflation indices. For the VA, this clause introduces a degree of cost uncertainty. While it aims to protect the contractor from unforeseen economic fluctuations that could make the contract unprofitable, it shifts some of that risk to the government. The final cost of this contract could be higher than the initial fixed price if the economic indicators used for adjustment increase significantly during the contract period. Careful monitoring and clear adjustment formulas are crucial to manage this risk.

What is the significance of the contract being for 'Nursing Care Facilities (Skilled Nursing Facilities)'?

The classification 'Nursing Care Facilities (Skilled Nursing Facilities)' (NAICS code 623110) signifies that the contract is for services provided in facilities offering skilled nursing care. This level of care is typically for individuals who require medical attention and rehabilitation services beyond what can be provided in a hospital or assisted living facility. For the VA, this indicates a need to support veterans who require ongoing medical support, post-hospital recovery, or long-term care due to illness, injury, or disability. The focus on skilled nursing care highlights the VA's commitment to providing comprehensive healthcare services tailored to the complex medical needs of the veteran population.

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