DoD's $1.37B Healthcare Contract with CHRISTUS HEALTH Faces Scrutiny Over Competition and Value
Contract Overview
Contract Amount: $1,368,144,402 ($1.4B)
Contractor: Christus Health
Awarding Agency: Department of Defense
Start Date: 2013-10-01
End Date: 2023-09-30
Contract Duration: 3,651 days
Daily Burn Rate: $374.7K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: COMPREHENSIVE HEALTHCARE SERVICES
Place of Performance
Location: HOUSTON, HARRIS County, TEXAS, 77008
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $1.37 billion to CHRISTUS HEALTH for work described as: COMPREHENSIVE HEALTHCARE SERVICES Key points: 1. Significant spending of $1.37B over 10 years on healthcare services. 2. Lack of competition raises concerns about price discovery and potential overspending. 3. Contract awarded as 'NOT AVAILABLE FOR COMPETITION' suggests limited market options or specific requirements. 4. The sector is critical for military readiness and personnel well-being, demanding efficient resource allocation.
Value Assessment
Rating: questionable
The contract value of $1.37B over 10 years is substantial. Without available pricing data or benchmarks, it's difficult to assess if this represents good value. The lack of competition further complicates a fair value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'NOT AVAILABLE FOR COMPETITION', indicating a sole-source or limited competition scenario. This significantly restricts price discovery and may lead to higher costs compared to a competitive bidding process.
Taxpayer Impact: The absence of robust competition for a contract of this magnitude raises concerns about taxpayer money being used efficiently. Potential overpayment could divert funds from other critical defense needs.
Public Impact
Military personnel and their families rely on these comprehensive healthcare services. The large contract value represents a significant portion of the Defense Health Agency's budget. Potential inefficiencies or overpricing could impact the quality or availability of care. The long duration of the contract limits opportunities for reassessment and cost optimization.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- No available pricing data
- Long contract duration
- Potential for cost overruns
Positive Signals
- Provides essential healthcare services
- Long-term relationship with provider
Sector Analysis
This contract falls within the healthcare sector, specifically focusing on direct health and medical insurance carriers for the Department of Defense. Healthcare spending is a major component of federal budgets, and efficient procurement is crucial for service delivery and cost control.
Small Business Impact
The provided data does not indicate any specific provisions or set-asides for small businesses within this contract. The focus appears to be on a large, established provider, potentially excluding smaller entities from participating.
Oversight & Accountability
The 'NOT AVAILABLE FOR COMPETITION' status warrants closer oversight to ensure the government is receiving fair pricing and adequate service levels. Transparency regarding the justification for limited competition is essential for accountability.
Related Government Programs
- Direct Health and Medical Insurance Carriers
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Lack of competitive bidding
- Potential for inflated pricing
- Limited transparency on justification
- Long-term commitment without reassessment
- Difficulty in benchmarking costs
Tags
direct-health-and-medical-insurance-carr, department-of-defense, tx, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.37 billion to CHRISTUS HEALTH. COMPREHENSIVE HEALTHCARE SERVICES
Who is the contractor on this award?
The obligated recipient is CHRISTUS HEALTH.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $1.37 billion.
What is the period of performance?
Start: 2013-10-01. End: 2023-09-30.
What specific factors justified the 'NOT AVAILABLE FOR COMPETITION' award, and were alternatives thoroughly explored?
The justification for a sole-source or limited competition award typically involves unique capabilities, urgent needs, or lack of market availability. A thorough review would involve documenting why other qualified sources could not meet the requirements and exploring phased competition or future competitive strategies to ensure better value over time.
How is the agency ensuring cost-effectiveness and fair pricing without a competitive bidding process?
Ensuring cost-effectiveness without competition relies heavily on robust negotiation, market research, and ongoing performance monitoring. The agency should employ independent cost analysis, benchmark against similar contracts (if possible), and implement strict performance metrics tied to payment to mitigate risks of overpricing and ensure value.
What mechanisms are in place to assess the quality and efficiency of healthcare services provided under this long-term contract?
Quality and efficiency are typically assessed through Service Level Agreements (SLAs), Key Performance Indicators (KPIs), patient satisfaction surveys, and regular performance reviews. The contract should include clear metrics for clinical outcomes, access to care, and administrative efficiency, with penalties for non-performance and incentives for exceeding expectations.
Industry Classification
NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers
Product/Service Code: MEDICAL SERVICES › GENERAL HEALTH CARE SERVICES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 919 HIDDEN RIDGE DR, IRVING, TX, 75038
Business Categories: Category Business, Corporate Entity Tax Exempt, Hospital, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,368,144,402
Exercised Options: $1,368,144,402
Current Obligation: $1,368,144,402
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2013-10-01
Current End Date: 2023-09-30
Potential End Date: 2023-09-30 00:00:00
Last Modified: 2025-08-28
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