Long-term contract for hospital services awarded to THE GENERAL HOSPITAL CORPORATION by HHS, spanning over 13 years

Contract Overview

Contract Amount: $12,709,148 ($12.7M)

Contractor: THE General Hospital Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 1994-09-15

End Date: 2007-07-31

Contract Duration: 4,702 days

Daily Burn Rate: $2.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST NO FEE

Sector: Healthcare

Place of Performance

Location: BOSTON, SUFFOLK County, MASSACHUSETTS, 02114

State: Massachusetts Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $12.7 million to THE GENERAL HOSPITAL CORPORATION for work described as: Key points: 1. Contract duration significantly exceeds typical service agreements, raising questions about sustained necessity and potential for market shifts. 2. Awarded under a cost-plus-fee structure, which can incentivize higher spending compared to fixed-price contracts. 3. The contract's extensive timeline suggests a stable, long-term relationship, potentially indicating a lack of recent competitive re-evaluation. 4. Performance context is limited without specific deliverables or outcome metrics, making value assessment challenging. 5. Sector positioning within healthcare services is broad, but the specific nature of services provided is not detailed. 6. The absence of small business participation is noted, suggesting limited opportunities for smaller entities in this specific award.

Value Assessment

Rating: questionable

Assessing the value of this contract is difficult due to its age and the lack of detailed performance data. The cost-plus-fee structure, while allowing for flexibility, can lead to higher overall costs for the government compared to fixed-price arrangements. Benchmarking against similar long-term hospital service contracts is challenging without knowing the specific services rendered and their associated market rates during the contract period (1994-2007). The extended duration suggests a potentially inflated cost over time if not rigorously managed and re-competed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. However, the long duration of the contract (over 13 years) raises questions about how frequently this competition was revisited. A single award over such an extended period might suggest either a highly specialized service or a lack of subsequent competitive solicitations, potentially limiting price discovery over time.

Taxpayer Impact: While full and open competition was initially employed, the prolonged period of the contract may have reduced the benefits of ongoing competition for taxpayers, potentially leading to less favorable pricing in later years compared to more frequent re-competitions.

Public Impact

Beneficiaries likely include patients requiring hospital services under the purview of the National Institutes of Health (NIH). Services delivered are hospital-related, though specific medical or research support functions are not detailed. Geographic impact is centered in Massachusetts, where the hospital is located. Workforce implications include employment at THE GENERAL HOSPITAL CORPORATION, supporting healthcare professionals and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Extended contract duration (1994-2007) without clear evidence of re-competition raises concerns about sustained value and potential for cost creep.
Cost-plus-fee contract type can lead to higher government spending compared to fixed-price arrangements.
Lack of specific performance metrics makes it difficult to assess the effectiveness and efficiency of services rendered.
No indication of small business participation or subcontracting opportunities.

Positive Signals

Awarded through full and open competition, suggesting an initial effort to secure competitive pricing.
Long-term nature of the contract implies a stable and potentially reliable provider of essential hospital services.
Contract was managed by a major federal agency (HHS/NIH), indicating a level of established oversight.

Sector Analysis

This contract falls within the healthcare services sector, specifically hospital operations and patient care. The market for hospital services is large and complex, often characterized by established providers and long-term relationships with government entities, particularly for research institutions like NIH. Benchmarking spending is difficult without specific service details, but federal spending on healthcare services is substantial, encompassing a wide range of medical supplies, equipment, and personnel.

Small Business Impact

There is no indication that this contract included small business set-asides. The nature of large-scale hospital services often favors established institutions capable of handling extensive patient loads and complex administrative requirements. This suggests limited direct subcontracting opportunities for small businesses unless specific ancillary services were outsourced, which is not detailed in the provided data.

Oversight & Accountability

Oversight would have been provided by the National Institutes of Health (NIH), a division of HHS. As a definitive contract, it likely involved periodic reviews and financial audits. However, the extended duration and cost-plus-fee structure necessitate robust oversight to ensure costs remained reasonable and services were necessary throughout the contract's life. Transparency is limited without access to detailed performance reports or audit findings.

Related Government Programs

Federal healthcare procurement
Hospital services contracts
NIH research support contracts
Cost-plus-fee contracts

Risk Flags

Long contract duration
Cost-plus-fee structure
Lack of specific performance metrics
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $12.7 million to THE GENERAL HOSPITAL CORPORATION. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is THE GENERAL HOSPITAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $12.7 million.

What is the period of performance?

Start: 1994-09-15. End: 2007-07-31.

What specific hospital services were provided under this contract?

The provided data does not specify the exact hospital services rendered by THE GENERAL HOSPITAL CORPORATION to the National Institutes of Health (NIH). Contracts of this nature typically encompass a broad range of medical care, including inpatient and outpatient services, diagnostic testing, surgical procedures, and potentially specialized research support. Without a detailed statement of work or contract line item details, it is impossible to ascertain the precise nature and scope of the services that justified a cost-plus-fee award spanning over 13 years and amounting to $12.7 million.

How does the total contract value of $12.7 million compare to similar long-term hospital service contracts?

Comparing the total contract value of $12.7 million for THE GENERAL HOSPITAL CORPORATION is challenging without knowing the specific services, duration, and inflation adjustments. This contract ran from 1994 to 2007, a period of 13 years. The average annual value was approximately $977,626. This figure needs to be contextualized against the type of hospital (e.g., community, research, specialized), patient volume, and the complexity of services. For instance, a contract supporting a large federal research hospital might naturally be higher than one for routine community care. Furthermore, cost-plus-fee contracts inherently have variable costs, making direct comparisons difficult without detailed cost breakdowns and performance metrics.

What were the primary risks associated with this cost-plus-fee contract structure?

The primary risk associated with a cost-plus-fee (CPF) contract structure, like the one awarded to THE GENERAL HOSPITAL CORPORATION, is the potential for cost overruns and reduced incentive for efficiency. The government agrees to pay the contractor's allowable costs plus a fixed fee representing profit. This can lead to the contractor having less motivation to control costs, as higher costs directly translate to higher allowable costs. For the government, the risk is paying more than necessary if costs are not rigorously monitored and controlled. In a long-term contract (1994-2007), this risk is amplified over time, potentially leading to significant budget implications if not managed effectively through stringent oversight and audits.

What does the 13-year duration of this contract imply about contractor performance and agency needs?

The 13-year duration (1994-2007) of this contract suggests a consistent and potentially satisfactory performance by THE GENERAL HOSPITAL CORPORATION, as well as a sustained need for the services provided by the National Institutes of Health (NIH). Agencies typically do not maintain contracts for such extended periods unless the contractor is meeting requirements and the services remain essential. However, such long durations can also indicate a lack of proactive contract management, potentially missing opportunities to re-compete the contract to ensure continued best value and incorporate updated technologies or service models. It implies a stable, long-term relationship that may have bypassed more recent competitive cycles.

Were there any specific performance metrics or milestones tied to this contract?

The provided data does not include specific performance metrics or milestones for this contract. For a cost-plus-fee contract, especially one spanning over a decade, performance is typically evaluated based on the allowability and reasonableness of costs incurred, adherence to the scope of work, and the quality of services delivered. Without access to the contract's statement of work, performance work statement, or any associated reports, it's impossible to detail the specific metrics used. Effective oversight would have relied on regular reporting from the contractor and potentially site visits or audits by the NIH contracting officer's representative to ensure compliance and satisfactory service delivery.

How did the total spending of $12.7 million align with the agency's budget for hospital services during that period?

Determining how the $12.7 million spent aligns with the National Institutes of Health's (NIH) budget for hospital services between 1994 and 2007 requires detailed historical budget data for the agency, which is not provided. Federal agencies manage complex budgets with numerous line items. This contract represented a portion of the NIH's overall healthcare and research support expenditures. The cost-plus-fee nature of the contract means the final amount could fluctuate based on actual costs incurred. To assess alignment, one would need to compare this expenditure against the specific appropriations allocated for such services during those fiscal years and analyze the proportion it represented of the total NIH budget.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: COST NO FEE (S)

Contractor Details

Parent Company: Partners Healthcare System, Inc

Address: 55 FRUIT ST, BOSTON

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $2,052,434

Exercised Options: $2,052,434

Current Obligation: $12,709,148

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline