HHS awards $5.9M for emergency medicine services at Fort Yates Hospital, with limited competition

Contract Overview

Contract Amount: $5,895,780 ($5.9M)

Contractor: BAY Area Anesthesia LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-02-26

End Date: 2026-05-29

Contract Duration: 457 days

Daily Burn Rate: $12.9K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EMERGENCY MEDICINE PHYSICIAN AND NURSING SERVICES, AT THE FORT YATES HOSPITAL (FYH), FORT YATES, ND

Place of Performance

Location: FORT YATES, SIOUX County, NORTH DAKOTA, 58538

State: North Dakota Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $5.9 million to BAY AREA ANESTHESIA LLC for work described as: EMERGENCY MEDICINE PHYSICIAN AND NURSING SERVICES, AT THE FORT YATES HOSPITAL (FYH), FORT YATES, ND Key points: 1. Value for money appears fair given the critical nature of emergency services, though benchmarking is limited. 2. Competition dynamics indicate a sole-source award, potentially impacting price discovery and cost-effectiveness. 3. Risk indicators are moderate, primarily related to the sole-source nature and potential for cost overruns without competitive pressure. 4. Performance context is essential, as uninterrupted emergency services are vital for the Fort Yates community. 5. Sector positioning places this contract within the healthcare services for federal facilities, specifically serving the Indian Health Service.

Value Assessment

Rating: fair

The contract value of $5.9 million for 457 days of emergency medicine physician and nursing services is difficult to benchmark precisely due to the specific location and limited public data on comparable sole-source awards for rural IHS facilities. The firm-fixed-price structure provides some cost certainty, but without competitive bidding, it's challenging to definitively assess if this represents optimal value for money. The price per day is approximately $12,901, which needs to be evaluated against the specific scope of services and staffing levels required.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source purchase order, meaning it was not competed. The justification for a sole-source award typically involves unique capabilities or circumstances where only one source can reasonably provide the required services. The absence of competition means that potential cost savings that might arise from a bidding process are not realized, and the government does not benefit from a range of proposals to choose from.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the most cost-effective service, as there was no market pressure to drive down prices. This award bypasses the standard competitive process designed to ensure fair and reasonable pricing.

Public Impact

The primary beneficiaries are the residents of the Fort Yates community and surrounding areas who rely on the Fort Yates Hospital for emergency medical care. The services delivered include essential emergency medicine physician and nursing support, ensuring critical care availability. The geographic impact is localized to Fort Yates, North Dakota, and the service area of the Indian Health Service facility. Workforce implications include the provision of specialized medical personnel to maintain hospital operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential for cost savings.
Lack of transparency in the sole-source justification process.
Potential for price creep over the contract duration without competitive oversight.

Positive Signals

Ensures continuity of critical emergency medical services for a vulnerable population.
Firm-fixed-price contract provides budget certainty.
Award supports a vital healthcare facility in a rural area.

Sector Analysis

This contract falls within the healthcare services sector, specifically focusing on hospital operations and emergency medical care. The market for specialized medical staffing, particularly in rural or remote areas serving federal populations like those managed by the Indian Health Service, can be limited. Benchmarking is challenging as many such contracts may be sole-sourced or awarded under specific tribal or federal agreements, making direct comparisons difficult.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for small businesses based on the limited information. The award to Bay Area Anesthesia LLC, a single entity, suggests a focus on specialized service delivery rather than broad subcontracting. Further analysis would be needed to determine if any small business participation was mandated or occurred.

Oversight & Accountability

Oversight for this contract would primarily fall under the Indian Health Service (IHS) within the Department of Health and Human Services (HHS). Accountability measures would be tied to the performance standards outlined in the purchase order and the firm-fixed-price agreement. Transparency is limited due to the sole-source nature of the award; details regarding the justification and negotiation process are not publicly detailed. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse.

Related Government Programs

Indian Health Service Hospital Operations
Rural Healthcare Services
Emergency Medical Services Contracts
Federal Healthcare Provider Agreements

Risk Flags

Sole-source award may limit cost-effectiveness.
Limited public data for benchmarking sole-source healthcare contracts.
Potential for price escalation without competitive oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $5.9 million to BAY AREA ANESTHESIA LLC. EMERGENCY MEDICINE PHYSICIAN AND NURSING SERVICES, AT THE FORT YATES HOSPITAL (FYH), FORT YATES, ND

Who is the contractor on this award?

The obligated recipient is BAY AREA ANESTHESIA LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $5.9 million.

What is the period of performance?

Start: 2025-02-26. End: 2026-05-29.

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

The provided data indicates the contract was 'NOT COMPETED UNDER SAP' (Simplified Acquisition Procedures), suggesting it was likely awarded under specific sole-source authority. Common justifications for sole-source awards in federal contracting include situations where only one responsible source is available, or when a compelling urgency exists that precludes full and open competition. For healthcare services in remote locations like Fort Yates, ND, the availability of qualified providers with the necessary expertise and willingness to serve may be limited, potentially leading to a sole-source determination. A detailed review of the contract file and justification documentation would be required to ascertain the precise reasons.

How does the daily cost of these services compare to similar contracts for emergency medicine providers?

The daily cost for emergency medicine physician and nursing services under this contract is approximately $12,901 ($5,895,780 / 457 days). Benchmarking this figure is challenging without more specific data on the scope of services, required staffing levels (number of physicians, nurses, and their specialties), patient volume, and geographic location. Contracts for emergency services can vary significantly based on these factors. Sole-source awards, by their nature, lack direct competitive pricing data. To provide a robust comparison, one would need to identify similar sole-source or limited-competition contracts for emergency medicine staffing at rural Indian Health Service facilities or comparable critical access hospitals, considering the specific skill mix and service hours.

What are the potential risks associated with a sole-source award for essential healthcare services?

The primary risk associated with a sole-source award for essential healthcare services is the potential for inflated costs due to the absence of competitive pressure. Without multiple bidders vying for the contract, the awarded contractor may not have the same incentive to offer the most competitive pricing. Additionally, there's a risk of reduced innovation and service quality if the contractor faces no market-based pressure to improve. For taxpayers, this can translate to higher expenditures than might be achieved through a competitive process. Ensuring robust performance monitoring and clear contract terms becomes even more critical in sole-source situations to mitigate these risks.

What is the track record of Bay Area Anesthesia LLC in providing federal healthcare services?

Information regarding Bay Area Anesthesia LLC's specific track record in providing federal healthcare services, particularly to agencies like the Indian Health Service, is not detailed in the provided data. A comprehensive assessment would require searching federal contract databases (like SAM.gov or FPDS) for past performance history, including contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. Understanding their experience with similar populations, facility types, and regulatory environments would be crucial for evaluating their capability and reliability in fulfilling this contract.

What are the historical spending patterns for emergency medicine services at Fort Yates Hospital?

The provided data only includes details for the current contract award ($5.9 million from Feb 2025 to May 2026). Historical spending patterns for emergency medicine services at Fort Yates Hospital are not available in this dataset. To analyze historical spending, one would need to access previous contract awards for similar services at this specific facility, potentially going back several years. This would involve searching federal procurement databases for prior awards made by the Indian Health Service or other relevant entities to providers at Fort Yates Hospital. Understanding past spending levels, contract types (competed vs. sole-source), and award values would provide crucial context for evaluating the current contract's value and necessity.

Industry Classification

NAICS: Health Care and Social Assistance › General Medical and Surgical Hospitals › General Medical and Surgical Hospitals

Product/Service Code: MEDICAL SERVICES › GENERAL HEALTH CARE SERVICES

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: 1839 S ALMA SCHOOL RD STE 335, MESA, AZ, 85210

Business Categories: American Indian Owned Business, Category Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, 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: $6,786,780

Exercised Options: $6,786,780

Current Obligation: $5,895,780

Actual Outlays: $4,720,190

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline