DoD's $29.2M Medical/Dental Assessment Services Contract with OptumServe Raises Questions on Value and Competition
Contract Overview
Contract Amount: $29,193,846 ($29.2M)
Contractor: Optumserve Health Services, Inc.
Awarding Agency: Department of Defense
Start Date: 2017-12-05
End Date: 2018-12-04
Contract Duration: 364 days
Daily Burn Rate: $80.2K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: IGF::OT::IGF MEDICAL/DENTAL ASSESSMENT SERVICES
Place of Performance
Location: LA CROSSE, LA CROSSE County, WISCONSIN, 54601
Plain-Language Summary
Department of Defense obligated $29.2 million to OPTUMSERVE HEALTH SERVICES, INC. for work described as: IGF::OT::IGF MEDICAL/DENTAL ASSESSMENT SERVICES Key points: 1. The contract awarded to OptumServe for medical/dental assessment services represents a significant expenditure of $29.2 million. 2. While awarded under full and open competition, the specific pricing and value proposition require deeper analysis. 3. Potential risks include ensuring consistent quality of care and efficient resource allocation across the contract duration. 4. The spending falls within the broader healthcare sector, specifically supporting defense health services.
Value Assessment
Rating: questionable
The contract's total value of $29.2 million for a one-year period suggests a substantial per-unit cost. Without detailed service breakdowns and comparison data against similar government or commercial contracts for medical/dental assessments, it's difficult to definitively assess its value for money.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. This method is generally conducive to competitive pricing, but the final price achieved still needs to be benchmarked against market rates to confirm optimal price discovery.
Taxpayer Impact: Taxpayer funds are being utilized for this contract. While competition aims for efficiency, the ultimate impact depends on whether the services provided offer demonstrable value and cost-effectiveness compared to alternatives.
Public Impact
Ensures access to essential medical and dental assessment services for military personnel and potentially their families. Supports the operational readiness and well-being of the armed forces. The contract's performance directly impacts the quality and efficiency of healthcare delivery within the Department of Defense.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of detailed cost breakdown for unit services.
- Potential for price creep in follow-on contracts.
- Ensuring consistent quality across all assessment locations.
Positive Signals
- Awarded through full and open competition.
- Supports critical defense health infrastructure.
Sector Analysis
This contract falls under the Healthcare sector, specifically within the Defense Health Agency's purview. Spending benchmarks for similar medical and dental assessment services within the federal government or large healthcare systems would be useful for comparison.
Small Business Impact
The data indicates the primary awardee is OptumServe Health Services, Inc., a large corporation. There is no explicit information provided regarding subcontracting opportunities for small businesses within this contract, which warrants further investigation.
Oversight & Accountability
Oversight by the Defense Health Agency is crucial to ensure that OptumServe meets all contractual obligations, delivers high-quality services, and adheres to pricing agreements. Regular performance reviews and audits are essential for accountability.
Related Government Programs
- Offices of Physicians (except Mental Health Specialists)
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Lack of detailed service-level cost data.
- Potential for undefined scope creep.
- Dependence on a single large contractor for critical services.
- Need for robust performance monitoring and quality assurance.
- Unclear small business participation.
Tags
offices-of-physicians-except-mental-heal, department-of-defense, wi, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $29.2 million to OPTUMSERVE HEALTH SERVICES, INC.. IGF::OT::IGF MEDICAL/DENTAL ASSESSMENT SERVICES
Who is the contractor on this award?
The obligated recipient is OPTUMSERVE HEALTH SERVICES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $29.2 million.
What is the period of performance?
Start: 2017-12-05. End: 2018-12-04.
What specific medical and dental assessment services are included in this contract, and how do their unit costs compare to industry benchmarks?
The contract covers 'MEDICAL/DENTAL ASSESSMENT SERVICES' under NAICS code 621111 (Offices of Physicians). However, specific service details and unit costs are not provided. A comprehensive analysis would require comparing the contract's pricing structure against similar services procured by other federal agencies or large private healthcare providers to ascertain if the $29.2 million represents a fair market value.
What are the key performance indicators (KPIs) used to measure the effectiveness and quality of the services provided by OptumServe?
The provided data does not specify the KPIs for this contract. Effective oversight would necessitate clearly defined metrics related to timeliness of appointments, accuracy of assessments, patient satisfaction, and adherence to clinical standards. The Defense Health Agency should be actively monitoring these KPIs to ensure the contractor is meeting performance expectations and delivering value.
Given the full and open competition, what was the range of bids received, and what factors led to OptumServe's selection at the awarded price?
While the contract states 'FULL AND OPEN COMPETITION,' the specific bid range is not detailed. Understanding the competitive landscape, including the number of bidders and their respective proposals, is crucial. The selection process should have evaluated not only price but also technical capabilities and past performance to ensure the best value was obtained for the government.
Industry Classification
NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians (except Mental Health Specialists)
Product/Service Code: MEDICAL SERVICES › OTHER MEDICAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Unitedhealth Group Incorporated (UEI: 112871561)
Address: 328 FRONT ST S, LA CROSSE, WI, 54601
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $29,193,846
Exercised Options: $29,193,846
Current Obligation: $29,193,846
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HT001113D0001
IDV Type: IDC
Timeline
Start Date: 2017-12-05
Current End Date: 2018-12-04
Potential End Date: 2018-12-04 00:00:00
Last Modified: 2020-05-28
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