DOJ awards $1.4M for medical services to University of Kentucky, raising value-for-money questions

Contract Overview

Contract Amount: $1,988,178 ($2.0M)

Contractor: University of Kentucky

Awarding Agency: Department of Justice

Start Date: 2025-07-01

End Date: 2026-03-09

Contract Duration: 251 days

Daily Burn Rate: $7.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: REQUESTING $1,395,140.39 PARTIALLY FUND ACCOUNT

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40517

State: Kentucky Government Spending

Plain-Language Summary

Department of Justice obligated $2.0 million to UNIVERSITY OF KENTUCKY for work described as: REQUESTING $1,395,140.39 PARTIALLY FUND ACCOUNT Key points: 1. The contract's value-for-money is questionable given the lack of competition and the high per-unit cost. 2. Competition dynamics are absent, as this was a sole-source award, potentially limiting price discovery. 3. Risk indicators include the sole-source nature and the absence of a competitive benchmark. 4. Performance context is limited to general medical and surgical hospital services. 5. Sector positioning is within the healthcare services for federal correctional facilities.

Value Assessment

Rating: questionable

The awarded amount of $1,395,140.39 for a 251-day period raises concerns about value. Without competitive bidding, it is difficult to benchmark this price against similar contracts. The per-unit cost appears high, especially considering the services are for a federal prison system, which may have unique cost structures but should still benefit from market efficiencies.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. The University of Kentucky was likely selected due to specific capabilities or existing relationships. The lack of competition means there were no other bidders to drive down costs or offer alternative solutions, potentially leading to a higher price than if it had been competed.

Taxpayer Impact: Taxpayers may have paid a premium for these medical services due to the absence of a competitive bidding process. Without multiple offers, the government had limited leverage to negotiate the best possible price.

Public Impact

Inmates within the Federal Prison System will receive general medical and surgical hospital services. The primary beneficiaries are the incarcerated individuals requiring healthcare within the specified facility. The geographic impact is localized to the facility served by the University of Kentucky in Kentucky. Workforce implications are likely minimal for the broader healthcare sector, but may involve specific medical personnel assigned to this contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of performance metrics or detailed service scope makes value assessment difficult.
High per-unit cost without competitive benchmark raises concerns about efficiency.

Positive Signals

University of Kentucky is a known healthcare provider, suggesting potential for reliable service delivery.
Contract is for essential medical services, addressing a critical need within the correctional system.

Sector Analysis

This contract falls within the healthcare services sector, specifically serving the unique needs of federal correctional facilities. The market for providing medical services to government institutions can be specialized, often involving established providers with the capacity to meet stringent security and operational requirements. Benchmarking against other federal prison healthcare contracts would be necessary for a comprehensive value assessment.

Small Business Impact

This contract does not appear to involve small business set-asides or subcontracting opportunities. The award to a large university suggests that the focus was on specialized capabilities rather than broad small business participation. This limits the direct impact on the small business ecosystem for this specific procurement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Justice's Federal Prison System. Accountability measures would be tied to the terms of the purchase order and the delivery of contracted medical services. Transparency is limited due to the sole-source nature and the absence of a competitive bidding process, making public scrutiny of pricing and value more challenging.

Related Government Programs

Federal Bureau of Prisons Medical Services Contracts
Department of Justice Healthcare Procurement
General Medical and Surgical Hospital Services Contracts

Risk Flags

Sole-source award
Lack of competitive benchmark
Potential for inflated pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $2.0 million to UNIVERSITY OF KENTUCKY. REQUESTING $1,395,140.39 PARTIALLY FUND ACCOUNT

Who is the contractor on this award?

The obligated recipient is UNIVERSITY OF KENTUCKY.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $2.0 million.

What is the period of performance?

Start: 2025-07-01. End: 2026-03-09.

What is the historical spending pattern for general medical and surgical hospital services within the Federal Prison System?

Historical spending data for general medical and surgical hospital services within the Federal Prison System (FPS) is crucial for contextualizing the current $1.4 million award. While specific figures for this exact service category and duration are not provided in the abbreviated data, the FPS consistently procures a wide range of healthcare services to meet the needs of its inmate population. Past contract awards, including those for primary care, specialized medical treatments, and hospital stays, would reveal trends in pricing, provider types, and contract durations. Analyzing this historical data allows for the identification of average costs per inmate, per diem rates, and the prevalence of sole-source versus competed contracts. Without this comparative context, it is difficult to definitively assess whether the current award represents a fair market price or an outlier. A review of previous FPS healthcare spending would likely show significant investment in medical care, with fluctuations based on inmate health trends, facility needs, and the competitive landscape for healthcare providers serving correctional institutions.

How does the University of Kentucky's pricing for these services compare to other academic medical centers serving federal facilities?

Comparing the University of Kentucky's pricing for these medical services to that of other academic medical centers serving federal facilities is essential for assessing value. However, without specific line-item costs or detailed service agreements for this $1.4 million purchase order, such a comparison is challenging. Academic medical centers often have complex pricing structures that reflect their research, teaching, and patient care missions. When contracting with federal entities, these institutions may offer different rates than private hospitals. To conduct a meaningful comparison, one would need to identify similar contracts awarded to other university hospitals or major medical centers by the Federal Bureau of Prisons or other federal agencies. Key metrics to compare would include per diem rates, costs for specific procedures, physician service fees, and administrative overhead. The sole-source nature of this award prevents a direct competitive benchmark, making historical data and comparisons with similar institutions the primary methods for evaluating cost-effectiveness.

What are the specific medical services included in this $1.4 million contract?

The provided data indicates that the contract is for 'General Medical and Surgical Hospitals' services (NAICS code 622110), with a total award amount of $1,395,140.39. However, the specific breakdown of services included within this broad category is not detailed. Typically, 'General Medical and Surgical Hospitals' encompass a wide range of healthcare provisions, including but not limited to physician consultations, diagnostic services (laboratory tests, imaging), emergency care, inpatient and outpatient surgical procedures, pharmacy services, and potentially specialized care depending on the facility's needs. For a federal prison system, these services are critical for maintaining the health and well-being of the inmate population. The duration of the contract, from July 1, 2025, to March 9, 2026 (251 days), suggests ongoing medical support rather than a single event. A more granular understanding of the service scope would be necessary to accurately assess the value and appropriateness of the awarded amount.

What is the University of Kentucky's track record in providing healthcare services to federal correctional facilities?

The University of Kentucky's track record in providing healthcare services specifically to federal correctional facilities is a key factor in evaluating this contract, particularly given its sole-source nature. While the University of Kentucky is a large and established academic medical center, its experience with the unique demands of correctional healthcare is not detailed in the provided data. Federal correctional facilities have specific security, logistical, and patient population needs that differ from civilian healthcare settings. Information regarding prior contracts, performance history, and any past issues or successes in serving similar government institutions would be crucial. Without this background, it is difficult to ascertain the extent of their relevant experience and whether this award is based on a proven ability to meet the stringent requirements of the Federal Prison System. Further investigation into their contract history with federal agencies, especially the Bureau of Prisons, would be necessary.

Are there any performance metrics or key performance indicators (KPIs) associated with this contract?

The provided data for this contract does not explicitly mention any performance metrics or Key Performance Indicators (KPIs). For a contract of this magnitude and duration, focused on essential medical services, it is highly probable that performance standards are defined within the full contract documentation. These KPIs would typically relate to the quality of care, timeliness of service delivery, patient satisfaction (where applicable and measurable within the correctional context), adherence to medical protocols, and potentially specific health outcome measures. The absence of this information in the summary data makes it difficult to assess how the University of Kentucky's performance will be monitored and evaluated. Effective oversight relies on clearly defined and measurable KPIs to ensure that the Federal Prison System receives the contracted services at the expected standard and that taxpayer funds are used efficiently.

Industry Classification

NAICS: Health Care and Social Assistance › General Medical and Surgical Hospitals › General Medical and Surgical Hospitals

Product/Service Code: MEDICAL SERVICES › GENERAL HEALTH CARE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 410 ADMINISTRATION DR, LEXINGTON, KY, 40506

Business Categories: Category Business, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business, Higher Education (Public), Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,988,178

Exercised Options: $1,988,178

Current Obligation: $1,988,178

Actual Outlays: $1,516,050

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline