DoD's $13.5M nursing services contract awarded to Maxim Healthcare Services, Inc. shows potential value concerns

Contract Overview

Contract Amount: $13,545,211 ($13.5M)

Contractor: Maxim Healthcare Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2005-11-29

End Date: 2008-03-31

Contract Duration: 853 days

Daily Burn Rate: $15.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE

Sector: Healthcare

Official Description: TAS::21 2020::TAS 200604!600065!2100!W91YTZ!WALTER REED ARMY MEDICAL CENTER !V797P4516A !C!N! !N!W91YTZ06F0060! !20051129!20060930!878933951!878933951!044306348!N!LOCKHEED MARTIN ASPENMED SERVI!8150 LEESBURG PIKE # 400 !VIENNA !VA!22182!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000007570846!N!N!000000000000!Q401!NURSING SERVICES !S1 !SERVICES !000 !NOT DISCERNABLE !621999!E! !6! ! ! ! ! !99990909!B! ! ! ! !A! ! ! !000! ! ! ! ! ! ! ! !B!N! ! ! ! ! ! ! !000! ! ! ! ! ! ! ! ! !0001! !

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20012

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $13.5 million to MAXIM HEALTHCARE SERVICES, INC. for work described as: TAS::21 2020::TAS 200604!600065!2100!W91YTZ!WALTER REED ARMY MEDICAL CENTER !V797P4516A !C!N! !N!W91YTZ06F0060! !20051129!20060930!878933951!878933951!044306348!N!LOCKHEED MARTIN ASPENMED SERVI!8150 LEESBURG PIKE # 400 !VIENNA !VA!22182!50000!001!11!WASHING… Key points: 1. Contract value appears high relative to the number of bids received. 2. Limited competition may have impacted price discovery and taxpayer value. 3. The contract's duration and fixed-price nature present moderate cost control risks. 4. Performance context is limited, making it difficult to assess overall effectiveness. 5. This contract falls within the broader healthcare services sector for the Department of Defense. 6. Small business participation is not explicitly detailed, requiring further investigation.

Value Assessment

Rating: fair

The contract's total value of $13.5 million for nursing services over approximately 2.8 years raises questions about value for money, especially given the limited competition. Benchmarking against similar contracts for nursing services within the DoD or other federal agencies would be necessary to definitively assess if the pricing was competitive. Without more detailed performance metrics or a comparison of the specific services rendered against market rates, it's challenging to provide a precise value assessment. However, the single award in a full and open competition suggests potential for better pricing if more bidders had participated.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, which theoretically allows any responsible source to submit an offer. However, the data indicates only one bid was received. This limited number of bidders, despite the open competition, suggests potential issues with market interest, contractor capability, or the structure of the solicitation itself. A single bid in an open competition often leads to less competitive pricing and may indicate barriers to entry for other potential contractors.

Taxpayer Impact: When only one bid is received in a full and open competition, taxpayers may not be receiving the best possible price. The lack of competing offers means the government is negotiating with a single entity, potentially missing out on cost savings that would arise from a more robust bidding process.

Public Impact

Military personnel and their families at Walter Reed Army Medical Center likely benefited from the nursing services provided. The contract ensured the availability of essential healthcare support staff within a key military medical facility. The geographic impact is primarily focused on the Washington D.C. metropolitan area, specifically serving the Walter Reed Army Medical Center. The contract supported healthcare sector jobs, potentially including registered nurses, licensed practical nurses, and nursing assistants.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition despite full and open solicitation could lead to higher costs.
Lack of detailed performance metrics makes it difficult to assess service quality and value.
The contract's duration might not align with evolving healthcare needs or technological advancements.
Potential for contractor lock-in due to the single bid received.

Positive Signals

Awarded under full and open competition, adhering to federal procurement principles.
Fixed-price contract type can provide cost certainty if scope is well-defined.
The contractor, Maxim Healthcare Services, Inc., is an established provider in the healthcare staffing industry.

Sector Analysis

The federal healthcare services market is substantial, with significant spending directed towards supporting military health systems and civilian populations. Contracts for nursing services are critical for ensuring adequate staffing in government-run medical facilities. This specific contract for Walter Reed Army Medical Center falls within the broader category of healthcare support services, which includes a wide range of medical staffing and administrative functions. Comparable spending benchmarks for nursing services can vary widely based on location, required skill sets, and contract duration.

Small Business Impact

The provided data does not indicate if this contract included a small business set-aside or if there were specific subcontracting requirements for small businesses. Given the nature of specialized nursing services, it's possible that larger, established healthcare staffing firms were the primary focus. Further analysis would be needed to determine the extent of small business involvement, either as prime contractors or subcontractors, and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army and the Department of Defense. Accountability measures would include performance reviews, adherence to contract terms, and financial audits. Transparency is generally facilitated through contract databases like FPDS-NG, where basic award information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

TRICARE
Military Health System
Defense Health Agency Contracts
Nursing Services Contracts
Healthcare Staffing Contracts

Risk Flags

Limited competition despite full and open solicitation.
Potential for overpayment due to single bid.
Lack of detailed performance metrics.
Contract duration may not reflect current needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.5 million to MAXIM HEALTHCARE SERVICES, INC.. TAS::21 2020::TAS 200604!600065!2100!W91YTZ!WALTER REED ARMY MEDICAL CENTER !V797P4516A !C!N! !N!W91YTZ06F0060! !20051129!20060930!878933951!878933951!044306348!N!LOCKHEED MARTIN ASPENMED SERVI!8150 LEESBURG PIKE # 400 !VIENNA !VA!22182!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000007570846!N!N!000000000000!Q401!NURSING SERVICES !S1 !SERVICES !000 !NOT DISCERNABLE !621999!E

Who is the contractor on this award?

The obligated recipient is MAXIM HEALTHCARE SERVICES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $13.5 million.

What is the period of performance?

Start: 2005-11-29. End: 2008-03-31.

What is the track record of Maxim Healthcare Services, Inc. with federal contracts, particularly in nursing services?

Maxim Healthcare Services, Inc. has a significant history of receiving federal contracts, primarily within the healthcare sector. Their awards often involve providing nursing and other healthcare professional staffing services to various government agencies, including the Department of Defense (DoD) and the Department of Veterans Affairs (VA). Analysis of their contract history reveals a pattern of securing large-value awards for staffing solutions across different military installations and healthcare facilities. While their extensive experience suggests capability, a deeper dive into past performance reviews, any documented disputes, or instances of contract modifications would provide a more comprehensive understanding of their reliability and effectiveness as a federal contractor. Specific to nursing services, their consistent awards indicate a strong market presence and established relationships within the federal healthcare procurement landscape.

How does the awarded price of $13.5 million compare to similar nursing services contracts awarded by the DoD or other federal agencies?

Benchmarking the $13.5 million award for nursing services requires comparing it against contracts with similar scope, duration, geographic location, and skill requirements. Contracts for nursing services can vary significantly in price due to factors like the level of nursing expertise required (e.g., RNs vs. LPNs, specialized units), the number of hours or personnel needed, and the specific location's cost of living and labor market. For instance, a contract providing general duty nurses in a lower cost-of-living area might be substantially less expensive than one requiring specialized critical care nurses in a high-cost urban center. Without detailed service level agreements and specific personnel counts for this Walter Reed contract, a precise comparison is difficult. However, given it was a single bid in a full and open competition, there is a possibility that the price could be higher than if multiple bids had been received, potentially indicating a fair, but not necessarily optimal, market price.

What are the primary risks associated with a sole bid received under a full and open competition for nursing services?

The primary risk associated with receiving only one bid under a full and open competition is the potential for inflated pricing and reduced value for taxpayers. When there is no competition, the government loses its leverage to negotiate the best possible price, as the single bidder knows they are the only option. This can lead to the government paying more than necessary for the services. Additionally, a single bid might indicate issues with the solicitation itself, such as overly restrictive requirements, unclear scope of work, or inadequate outreach, which could deter other qualified contractors from participating. This lack of competition can also limit the government's options if the sole bidder fails to perform adequately, as finding an alternative contractor quickly could be challenging and costly.

What specific nursing services were delivered under this contract, and how was their effectiveness measured?

The contract data indicates the service category as 'NURSING SERVICES' and the Product Service Code (PSC) as '621999' (Offices of All Other Miscellaneous Health Practitioners), suggesting a broad range of nursing support. However, the specific details of the services rendered – such as the number of nursing hours provided, the types of nursing specialties covered (e.g., general duty, critical care, specialized units), and the patient population served – are not explicitly detailed in the provided summary. Effectiveness is typically measured through performance metrics outlined in the contract's Performance Work Statement (PWS). These metrics could include adherence to schedules, patient care quality indicators, staff competency assessments, and compliance with healthcare regulations. Without access to the PWS and subsequent performance reports, a thorough assessment of the effectiveness of the nursing services delivered under this contract is not possible from the given data.

How has federal spending on nursing services contracts evolved over the past decade, and what trends are apparent?

Federal spending on nursing services contracts has generally seen an upward trend over the past decade, driven by factors such as an aging military population, increased demand for healthcare services at military treatment facilities, and the ongoing need for specialized medical personnel. Agencies like the Department of Defense (DoD) and the Department of Veterans Affairs (VA) are significant contributors to this spending, often utilizing contract nurses to fill staffing gaps, provide surge capacity during deployments or health crises, and offer specialized care. Trends include a greater emphasis on fixed-price contracts where feasible, increased use of indefinite-delivery/indefinite-quantity (IDIQ) vehicles for flexibility, and a growing focus on ensuring contractor performance and quality through more robust oversight and performance metrics. The COVID-19 pandemic also significantly impacted spending patterns, leading to a surge in demand for contract nurses across various federal agencies.

What is the significance of the contract being awarded in fiscal year 2005 for services extending into 2008?

The award date of November 29, 2005, for services extending through March 31, 2008, signifies a contract duration of approximately 2 years and 4 months. This timeframe is relatively standard for service contracts that require continuity of operations, such as providing essential healthcare staffing. Awarding contracts well in advance of the service period allows for a structured transition, ensures uninterrupted service delivery, and provides the contractor sufficient time for recruitment and mobilization. For the government, it ensures that critical functions like nursing support at a major medical center like Walter Reed are secured. The extended period also implies a stable requirement for these services, rather than a short-term or emergency need. However, longer contract durations can also increase the risk of price escalation if market conditions change significantly during the contract period, especially if fixed-price terms do not adequately account for potential inflation or increased labor costs.

Industry Classification

NAICS: Health Care and Social Assistance › Offices of Other Health Practitioners › Offices of All Other Miscellaneous Health Practitioners

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIXED PRICE (J)

Contractor Details

Address: 7227 LEE DEFOREST DR, COLUMBIA, MD, 21046

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: V797P4516A

IDV Type: FSS

Timeline