VA Spends $13.3M on Anesthesia Services with University Physicians Group, Not Competed
Contract Overview
Contract Amount: $13,259,262 ($13.3M)
Contractor: University Physicians Group
Awarding Agency: Department of Veterans Affairs
Start Date: 2008-01-01
End Date: 2011-06-30
Contract Duration: 1,276 days
Daily Burn Rate: $10.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: ANESTHESIA SERVICES
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78229
State: Texas Government Spending
Plain-Language Summary
Department of Veterans Affairs obligated $13.3 million to UNIVERSITY PHYSICIANS GROUP for work described as: ANESTHESIA SERVICES Key points: 1. Significant spending on anesthesia services highlights a critical healthcare need within the VA. 2. The sole provider, University Physicians Group, suggests potential lack of competition or specialized services. 3. A $13.3M contract without competition raises concerns about price discovery and value for taxpayer money. 4. The General Medical and Surgical Hospitals sector often involves complex service contracts requiring careful oversight.
Value Assessment
Rating: questionable
The contract value of $13.3M for anesthesia services is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to market rates for similar services provided to other large healthcare systems.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and may lead to higher costs for the government as there was no market pressure to offer the best price.
Taxpayer Impact: The lack of competition on a $13.3M contract means taxpayers may be overpaying for essential anesthesia services.
Public Impact
Veterans may experience continuity of care with a known provider, but potentially at a higher cost. The absence of competition could stifle innovation and service improvements from other potential providers. Transparency in sole-source contracts is crucial to ensure fair pricing and accountability for public funds.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Potential Overpricing
- Limited Transparency
Positive Signals
- Ensured continuity of care for veterans
Sector Analysis
Anesthesia services are crucial for general medical and surgical hospitals. Spending benchmarks for such services can vary widely based on geographic location, hospital size, and complexity of procedures. This $13.3M contract represents a significant investment in supporting VA medical facilities.
Small Business Impact
The contract data does not indicate any participation or subcontracting by small businesses. The focus appears to be on a single, larger provider for these specialized services.
Oversight & Accountability
The 'NOT COMPETED' status warrants further investigation into the justification for a sole-source award. Oversight should focus on ensuring the necessity of this approach and verifying the reasonableness of the price paid.
Related Government Programs
- General Medical and Surgical Hospitals
- Department of Veterans Affairs Contracting
- Department of Veterans Affairs Programs
Risk Flags
- Sole-source award lacks transparency.
- Potential for inflated pricing.
- No market-driven cost optimization.
- Risk of service disruption if provider fails.
- Limited opportunity for small business participation.
Tags
general-medical-and-surgical-hospitals, department-of-veterans-affairs, tx, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Veterans Affairs awarded $13.3 million to UNIVERSITY PHYSICIANS GROUP. ANESTHESIA SERVICES
Who is the contractor on this award?
The obligated recipient is UNIVERSITY PHYSICIANS GROUP.
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 $13.3 million.
What is the period of performance?
Start: 2008-01-01. End: 2011-06-30.
What was the justification for awarding this anesthesia services contract on a sole-source basis?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or a lack of other qualified sources. Without specific documentation, it's presumed the VA determined University Physicians Group was the only viable option at the time, possibly due to specialized expertise or existing infrastructure critical for uninterrupted patient care.
How was the 'firm fixed price' determined without competitive bidding to ensure value?
In the absence of competition, a firm fixed price is often determined through negotiation based on historical pricing, cost analysis of the contractor's proposed expenses, and comparison to industry benchmarks for similar services. The VA would have likely reviewed the contractor's cost structure and profit margins to ensure the price was fair and reasonable, though this process is less rigorous than competitive bidding.
What is the long-term risk of relying on a single provider for critical anesthesia services?
The long-term risk includes potential price escalation as the provider faces no competitive pressure, reduced incentive for innovation or service improvement, and vulnerability if the provider experiences financial difficulties or decides to discontinue services. This could disrupt critical healthcare operations for veterans and necessitate costly emergency procurements.
Industry Classification
NAICS: Health Care and Social Assistance › General Medical and Surgical Hospitals › General Medical and Surgical Hospitals
Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: VA-257-08-RP-0048
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6126 WURZBACH RD, SAN ANTONIO, TX, 90
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $13,259,262
Exercised Options: $13,259,262
Current Obligation: $13,259,262
Timeline
Start Date: 2008-01-01
Current End Date: 2011-06-30
Potential End Date: 2011-06-30 00:00:00
Last Modified: 2011-01-06
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