DOD's $22M contract for military entrance processing services awarded to Chenega Tri-Services, LLC

Contract Overview

Contract Amount: $21,999,980 ($22.0M)

Contractor: Chenega Tri-Services, LLC

Awarding Agency: Department of Defense

Start Date: 2025-04-18

End Date: 2025-12-17

Contract Duration: 243 days

Daily Burn Rate: $90.5K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: UNITED STATES MILITARY ENTRANCE PROCESSING COMMAND (USMEPCOM) - FEE BASIS PROVIDERS SERVICES

Place of Performance

Location: NORTH CHICAGO, LAKE County, ILLINOIS, 60064

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $22.0 million to CHENEGA TRI-SERVICES, LLC for work described as: UNITED STATES MILITARY ENTRANCE PROCESSING COMMAND (USMEPCOM) - FEE BASIS PROVIDERS SERVICES Key points: 1. Contract awarded on a firm-fixed-price basis, indicating predictable costs for the government. 2. The contract duration is 243 days, suggesting a short-term or specific project need. 3. Awarded as 'NOT COMPETED', raising questions about potential cost savings through competition. 4. The North American Industry Classification System (NAICS) code 621111 points to physician services, aligning with medical evaluations. 5. The contract is for services supporting the UNITED STATES MILITARY ENTRANCE PROCESSING COMMAND (USMEPCOM). 6. The base award amount is $9,053,500, with a potential ceiling not explicitly stated but implied by the total award. 7. The contract is not set aside for small businesses, indicating a focus on larger prime contractors.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The firm-fixed-price structure provides cost certainty, but the absence of competition means potential savings from market forces are likely foregone. Comparing this to similar contracts for medical screening services at other military installations would be necessary to assess if the pricing is aligned with market rates. The lack of competition is a primary concern for value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a 'NOT COMPETED' procedure, indicating it was not subject to a full and open competition. This typically means either a sole-source justification was made, or it falls under specific exceptions to competitive requirements. The lack of multiple bidders means there was no opportunity for price discovery through a bidding war, potentially leading to higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without comparing bids, it's impossible to know if a lower price could have been achieved.

Public Impact

Potential recruits undergoing military entrance processing will receive necessary medical evaluations. Services are likely delivered at or near military entrance processing stations, impacting individuals seeking to join the armed forces. The contract supports the operational readiness of the U.S. Military by ensuring medical qualifications of new enlistees. The geographic impact is concentrated in Illinois, where the contract is being performed. The contract supports the workforce within the healthcare services sector, specifically those providing physician services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Absence of a competitive process limits transparency in pricing.
Potential for contractor lock-in if future needs are also sole-sourced.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Supports a critical function for military recruitment and readiness.
Awarded to a known entity, Chenega Tri-Services, LLC, potentially indicating past performance.

Sector Analysis

This contract falls within the Healthcare and Social Assistance sector, specifically focusing on physician services (NAICS 621111). The market for medical services supporting government functions, such as military entrance processing, is specialized. While specific market size data for this niche is not readily available, the broader healthcare services market is substantial. This contract represents a small portion of overall federal spending on healthcare and personnel support services.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses in the provided data. This suggests that the prime contractor, Chenega Tri-Services, LLC, is expected to perform the majority of the work. The absence of small business participation goals means there is no direct mechanism to ensure benefits flow to the small business ecosystem through this specific award.

Oversight & Accountability

Oversight mechanisms for this contract would typically be managed by the Department of the Army contracting officers and program managers within USMEPCOM. Accountability measures are inherent in the firm-fixed-price contract type, requiring delivery of specified services. Transparency is limited by the non-competitive award; however, contract details are generally available through federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Entrance Processing Command (MEPCOM) Operations
Department of Defense Healthcare Services
Physician Services Contracts
Federal Medical Screening Services

Risk Flags

Non-competitive award
Lack of clear value-for-money assessment due to no competition
Potential for higher costs to taxpayers

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.0 million to CHENEGA TRI-SERVICES, LLC. UNITED STATES MILITARY ENTRANCE PROCESSING COMMAND (USMEPCOM) - FEE BASIS PROVIDERS SERVICES

Who is the contractor on this award?

The obligated recipient is CHENEGA TRI-SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $22.0 million.

What is the period of performance?

Start: 2025-04-18. End: 2025-12-17.

What is the track record of Chenega Tri-Services, LLC with similar government contracts?

Chenega Tri-Services, LLC, as part of the larger Chenega Corporation, has a significant history of performing government contracts, particularly within the Department of Defense and other federal agencies. They often provide a range of services including logistics, base operations support, and healthcare-related services. While specific details on past performance for identical services to USMEPCOM are not provided in this data snippet, their extensive experience suggests a familiarity with government contracting procedures and operational requirements. A deeper dive into their contract history, including past performance evaluations and any reported issues, would be necessary for a comprehensive assessment of their track record for this specific type of service.

How does the cost of this contract compare to similar services at other military installations?

Direct comparison of the cost is challenging without knowing the specific services rendered, the volume of individuals processed, and the geographic location's cost of living and labor market. However, the contract's award as 'NOT COMPETED' inherently raises concerns about whether the price reflects the best value achievable through market competition. Typically, competitive solicitations allow for price discovery and negotiation, leading to potentially lower costs. Without comparable competitive bids or publicly available benchmarks for similar physician services at other MEPCOM sites, it's difficult to definitively state if this contract's pricing is optimal. Further analysis would require access to pricing data from other, competitively awarded contracts for similar services.

What are the primary risks associated with a non-competitively awarded contract of this nature?

The primary risks associated with a non-competitively awarded contract like this one include potential overpayment due to the lack of price competition, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Taxpayers may not be receiving the best possible value for their money. There's also a risk of contractor complacency, as the absence of competition can lessen the pressure to maintain high service standards or competitive pricing in the future. Furthermore, it can create a perception of favoritism or an unfair playing field for other potential contractors.

How effective is the USMEPCOM in processing military entrance candidates, and how does this contract contribute?

The effectiveness of USMEPCOM is crucial for maintaining the operational readiness and strength of the U.S. military by ensuring that all new recruits meet the required physical and mental standards. This contract for Fee Basis Provider Services directly supports this mission by ensuring that necessary medical evaluations are conducted. The timely and accurate completion of these medical screenings is vital for processing individuals into military service. While the data provided doesn't offer metrics on USMEPCOM's overall effectiveness, this contract ensures a critical component of the entrance processing pipeline is resourced, contributing to the command's ability to fulfill its mandate.

What are the historical spending patterns for USMEPCOM's medical screening services?

Historical spending patterns for USMEPCOM's medical screening services would reveal trends in contract awards, amounts, and types of services procured over time. Without access to historical data, it's impossible to provide specific figures. However, it is reasonable to assume that USMEPCOM has consistently required medical screening services to process recruits. The nature of these contracts might vary, including competitively bid services, sole-source awards, and potentially different contract vehicles. Analyzing past spending could highlight whether non-competitive awards are a recurring practice for these services and whether overall spending has increased or decreased, potentially indicating changes in recruitment volume or service costs.

Are there any specific performance metrics or KPIs tied to this contract?

The provided data snippet does not explicitly detail specific performance metrics or Key Performance Indicators (KPIs) for this contract. However, as a firm-fixed-price contract for physician services, it is expected that the contractor will be required to meet certain standards related to the timeliness, accuracy, and completeness of medical examinations. These would typically be outlined in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). The government would monitor these aspects to ensure compliance. The absence of explicit KPIs in the summary data suggests that a detailed review of the contract document itself would be necessary to ascertain the precise performance expectations and measurement criteria.

Industry Classification

NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians (except Mental Health Specialists)

Product/Service Code: MEDICAL SERVICES › NURSING, NURSING HOME, EVAL/SCREEN

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5253 PRUE RD STE 230, SAN ANTONIO, TX, 78240

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,999,980

Exercised Options: $21,999,980

Current Obligation: $21,999,980

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W81K0425DA004

IDV Type: IDC

Timeline