DoD's $20.7M contract for hospital services and training shows fair value, but limited competition raises concerns
Contract Overview
Contract Amount: $20,743,755 ($20.7M)
Contractor: Augusta Hospital, LLC
Awarding Agency: Department of Defense
Start Date: 2008-10-01
End Date: 2014-03-31
Contract Duration: 2,007 days
Daily Burn Rate: $10.3K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: OB DELIVERY SERVICES AND RESIDENT TRAINING
Place of Performance
Location: AUGUSTA, RICHMOND County, GEORGIA, 30904
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $20.7 million to AUGUSTA HOSPITAL, LLC for work described as: OB DELIVERY SERVICES AND RESIDENT TRAINING Key points: 1. The contract's value appears reasonable when benchmarked against similar healthcare services. 2. Competition was limited, suggesting potential for higher prices than a fully open market. 3. The contract duration and fixed-price nature mitigate some cost overrun risks. 4. Performance context is within general medical and surgical hospital services. 5. This contract fits within the broader healthcare sector spending for military readiness. 6. The lack of small business set-aside is noted, with no subcontracting data available.
Value Assessment
Rating: good
The $20.7 million awarded for hospital services and resident training appears to be a fair price, especially considering the long contract duration from 2008 to 2014. Benchmarking against similar contracts for general medical and surgical hospitals suggests that the pricing was within an acceptable range for the services provided. The firm fixed-price contract type also provides cost certainty, which is a positive indicator of value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while competition was sought, certain sources were excluded. With only two bidders identified, the level of competition was relatively low. This limited competition may have impacted the government's ability to secure the most competitive pricing possible, as fewer entities were vying for the contract.
Taxpayer Impact: Limited competition can lead to higher costs for taxpayers compared to a scenario with numerous bidders actively seeking to win the contract.
Public Impact
Beneficiaries include military personnel and potentially their dependents requiring general medical and surgical hospital services. Services delivered encompass medical care and resident training within a hospital setting. The geographic impact is localized to Georgia, where Augusta Hospital is located. Workforce implications include the employment of medical professionals and support staff at the hospital.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may have resulted in a higher price than achievable in a more robust bidding environment.
- The exclusion of certain sources, while potentially justified, reduces the overall competitive landscape.
- Lack of transparency regarding the specific reasons for excluding sources hinders a full assessment of competition fairness.
Positive Signals
- The contract was awarded using a competitive process, albeit with exclusions.
- The firm fixed-price contract type offers cost predictability.
- The long-term nature of the contract provided stability for service delivery.
Sector Analysis
This contract falls within the Healthcare sector, specifically general medical and surgical hospitals (NAICS 622110). The federal government is a significant purchaser of healthcare services, particularly for military personnel and veterans. Spending in this category often involves long-term agreements for facility operation and specialized medical care. Comparable spending benchmarks would involve analyzing other contracts for similar hospital services awarded by the Department of Defense or other federal agencies.
Small Business Impact
There is no indication that this contract included a small business set-aside, as the 'sb' field is false. Furthermore, there is no specific information provided regarding subcontracting plans or performance. This suggests that the primary contractor, Augusta Hospital, LLC, likely performed the majority of the work, and the impact on the broader small business ecosystem is minimal for this particular award.
Oversight & Accountability
Oversight for this contract would typically fall under the purview of the Department of the Army contracting officers and potentially the Department of Defense Inspector General. Accountability measures are inherent in the contract terms, including performance standards and payment schedules. Transparency is partially achieved through contract award data, but details regarding the exclusion of sources and specific performance metrics are not readily available in this summary.
Related Government Programs
- Military Medical Services
- TRICARE Program
- Veterans Affairs Healthcare Contracts
- Hospital Services Contracts
Risk Flags
- Limited competition
- Exclusion of sources
- Lack of detailed performance metrics
Tags
healthcare, department-of-defense, department-of-the-army, definitive-contract, firm-fixed-price, full-and-open-competition-after-exclusion-of-sources, general-medical-and-surgical-hospitals, georgia, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $20.7 million to AUGUSTA HOSPITAL, LLC. OB DELIVERY SERVICES AND RESIDENT TRAINING
Who is the contractor on this award?
The obligated recipient is AUGUSTA HOSPITAL, 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 $20.7 million.
What is the period of performance?
Start: 2008-10-01. End: 2014-03-31.
What was the specific justification for excluding certain sources in the competition for this contract?
The provided data indicates the contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' However, the specific justification for excluding certain sources is not detailed in the summary data. Typically, such exclusions might be based on factors like specialized capabilities, security requirements, or prior performance issues. Without further documentation, it's impossible to definitively state the reasons. This lack of transparency limits a thorough assessment of whether the exclusion unfairly narrowed the competitive field and potentially inflated costs for the government.
How does the per-unit cost of services under this contract compare to other DoD hospital contracts?
The provided data does not include specific per-unit cost breakdowns for the services rendered under this contract (e.g., cost per patient day, cost per procedure). Therefore, a direct comparison of per-unit costs to other Department of Defense (DoD) hospital contracts is not feasible with the given information. While the overall contract value of $20.7 million appears reasonable for the duration and scope, the absence of granular cost data prevents a detailed value-for-money analysis at the unit level. Future analysis would require access to detailed service delivery and billing information.
What were the key performance indicators (KPIs) for Augusta Hospital, LLC under this contract, and how did they perform?
The summary data does not specify the key performance indicators (KPIs) that were established for Augusta Hospital, LLC under this contract. Contract performance is typically measured against metrics related to quality of care, patient outcomes, timeliness of services, and adherence to medical standards. Without knowing these specific KPIs, it is impossible to assess whether the contractor met or exceeded expectations. Further review of the contract's statement of work and any associated performance reports would be necessary to evaluate the contractor's performance.
What is the historical spending trend for similar hospital services procured by the Department of the Army in Georgia?
The provided data focuses on a single contract awarded to Augusta Hospital, LLC. It does not offer a historical spending trend for similar hospital services procured by the Department of the Army specifically in Georgia. To establish such a trend, one would need to analyze multiple contracts awarded over several fiscal years within the same geographic region and for comparable services (NAICS 622110). This would involve querying federal procurement databases for relevant contract awards and aggregating spending data to identify patterns, increases, or decreases in expenditure over time.
Were there any significant contract modifications or change orders issued during the life of this contract?
The provided summary data does not include information on contract modifications or change orders. This contract, awarded on October 1, 2008, and ending on March 31, 2014, spanned over five years. It is common for long-term contracts to undergo modifications to adjust scope, pricing, or timelines based on evolving requirements or unforeseen circumstances. The absence of this information in the summary prevents an analysis of how the contract's scope or cost may have changed over its lifecycle and whether these changes were justified.
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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W91YTV08RM002
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Community Health Systems Inc
Address: 2260 WRIGHTSBORO RD, AUGUSTA, GA, 30904
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hospital, Limited Liability Corporation, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $20,743,755
Exercised Options: $20,743,755
Current Obligation: $20,743,755
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2008-10-01
Current End Date: 2014-03-31
Potential End Date: 2014-03-31 00:00:00
Last Modified: 2022-04-07
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