DoD's $105M Physician Services Contract Awarded to American Hospital Services Group LLC Under Full and Open Competition

Contract Overview

Contract Amount: $105,336,730 ($105.3M)

Contractor: American Hospital Services Group LLC

Awarding Agency: Department of Defense

Start Date: 2007-03-01

End Date: 2013-01-10

Contract Duration: 2,142 days

Daily Burn Rate: $49.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: RCCC:125189

Place of Performance

Location: NELLIS AFB, CLARK County, NEVADA, 89191

State: Nevada Government Spending

Plain-Language Summary

Department of Defense obligated $105.3 million to AMERICAN HOSPITAL SERVICES GROUP LLC for work described as: RCCC:125189 Key points: 1. Significant contract value of over $105 million awarded to a single provider. 2. Full and open competition was utilized, suggesting a potentially competitive bidding process. 3. The contract duration is substantial, spanning over 2100 days. 4. The North American Industry Classification System (NAICS) code 621112 indicates services related to physician offices, including mental health specialists.

Value Assessment

Rating: fair

The contract value of $105.3 million over approximately 6 years suggests an average annual spend of around $17.5 million. Without specific per-unit data or comparison points for similar physician services contracts, it's difficult to definitively assess pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically allows for the widest possible range of bidders. This method is intended to foster price discovery and ensure the government receives competitive pricing.

Taxpayer Impact: The use of full and open competition aims to maximize taxpayer value by encouraging multiple bids and potentially lowering costs compared to less competitive methods.

Public Impact

Ensures access to essential physician and mental health specialist services for military personnel and their families. The long contract duration provides stability in service provision but may limit opportunities for newer providers to enter the market. Potential for significant cost savings if the competitive bidding process effectively drove down prices. The specific services provided under NAICS 621112 are critical for maintaining the health and readiness of the armed forces.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration may reduce flexibility and opportunities for cost optimization.
Lack of specific performance metrics or outcome data makes it hard to assess effectiveness.
Potential for price creep over the contract's extended period without clear benchmarks.

Positive Signals

Awarded through full and open competition, indicating a structured and potentially cost-effective procurement.
Contract addresses critical healthcare needs for military personnel.
Firm Fixed Price contract type helps manage cost uncertainty for the government.

Sector Analysis

The healthcare sector, particularly physician services, is a significant area of government spending. Benchmarks for similar contracts are highly dependent on the specific services, location, and patient volume, making direct comparisons challenging without more granular data.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors or prime contractors. Further analysis would be needed to determine the extent of small business participation in this contract.

Oversight & Accountability

The contract was awarded under full and open competition, suggesting a degree of oversight in the procurement process. However, the long duration and lack of detailed performance data in this summary warrant further investigation into ongoing oversight mechanisms.

Related Government Programs

Offices of Physicians, Mental Health Specialists
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Lack of detailed performance metrics.
Long contract duration may limit adaptability and cost optimization.
Absence of specific per-unit cost data for benchmarking.
Potential for price increases over the contract's lifespan without clear controls.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $105.3 million to AMERICAN HOSPITAL SERVICES GROUP LLC. RCCC:125189

Who is the contractor on this award?

The obligated recipient is AMERICAN HOSPITAL SERVICES GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $105.3 million.

What is the period of performance?

Start: 2007-03-01. End: 2013-01-10.

What was the competitive landscape like during the bidding process, and did multiple bids truly drive down costs?

While the contract was awarded under 'full and open competition,' the number of bids received and the price differences between them are not provided. To assess true value, it's crucial to know if the competition was robust and if the winning bid was significantly lower than others, or if it was the only viable offer.

How does the per-unit cost of services compare to industry benchmarks for similar physician and mental health specialist services?

Without specific details on the volume of services rendered and the corresponding payments, a per-unit cost benchmark is impossible to establish. Comparing the overall contract value to industry averages for similar scope contracts is a starting point, but granular data is needed for a precise assessment of cost-effectiveness.

What mechanisms are in place to ensure the quality and effectiveness of the physician services provided over the contract's long duration?

The provided data lacks information on performance metrics, quality assurance protocols, or patient satisfaction surveys. Effective oversight would require regular reviews of service quality, provider performance, and patient outcomes to ensure the Department of Defense receives value and maintains the health readiness of its personnel.

Industry Classification

NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians, Mental Health Specialists

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Chenega Corporation (UEI: 622692994)

Address: 415 EAGLEVIEW BLVD STE 108, EXTON, PA, 06

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $198,677,234

Exercised Options: $105,336,730

Current Obligation: $105,336,730

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA701406D0001

IDV Type: IDC

Timeline