DOJ's $27M contract with Quest Diagnostics for medical labs in FY26 faces scrutiny over value and competition
Contract Overview
Contract Amount: $27,044 ($27.0K)
Contractor: Quest Diagnostics Incorporated
Awarding Agency: Department of Justice
Start Date: 2026-01-20
End Date: 2026-03-31
Contract Duration: 70 days
Daily Burn Rate: $386/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: FY26 QUEST DIAGNOSTICS -POP JAN-MARCH
Place of Performance
Location: SECAUCUS, HUDSON County, NEW JERSEY, 07094
Plain-Language Summary
Department of Justice obligated $27,043.84 to QUEST DIAGNOSTICS INCORPORATED for work described as: FY26 QUEST DIAGNOSTICS -POP JAN-MARCH Key points: 1. Quest Diagnostics secured a $27M contract for medical laboratory services. 2. The contract was awarded under full and open competition. 3. Potential risks include the concentration of services and the BPA call award method. 4. The healthcare sector, specifically medical laboratories, is a significant area of federal spending.
Value Assessment
Rating: fair
The contract value of $27M for a 2-month period appears high for medical laboratory services. Benchmarking against similar contracts for comparable services is needed to assess if this pricing is competitive.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Awarded via a BPA call under full and open competition, this method allows for competitive pricing. However, the specific details of the call and the number of bidders are crucial to understanding the price discovery achieved.
Taxpayer Impact: Taxpayer funds are being utilized for essential medical laboratory services. Ensuring competitive pricing through robust competition is key to maximizing value for money.
Public Impact
Ensures critical medical laboratory services for federal inmates. Supports the operational needs of the Federal Prison System. Potential for cost savings if pricing is benchmarked effectively against market rates.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- High per-unit cost potential
- Limited duration may indicate a need for ongoing services
- BPA call award method requires careful review
Positive Signals
- Full and open competition utilized
- Services are essential for inmate health
Sector Analysis
The healthcare sector, particularly medical laboratories, represents a substantial portion of federal spending. Benchmarks for similar contracts are essential for evaluating the value of this award.
Small Business Impact
The data does not indicate whether small businesses were involved in this contract. Further analysis is needed to determine opportunities for small business participation in future procurements.
Oversight & Accountability
Oversight is crucial to ensure the quality of services and adherence to contract terms. The Bureau of Prisons should monitor performance and costs closely.
Related Government Programs
- Medical Laboratories
- Department of Justice Contracting
- Federal Prison System / Bureau of Prisons Programs
Risk Flags
- High contract value for a short duration
- Potential for vendor lock-in
- Lack of detailed service breakdown for cost analysis
- Need for independent cost benchmarking
Tags
medical-laboratories, department-of-justice, nj, bpa-call, under-100k
Frequently Asked Questions
What is this federal contract paying for?
Department of Justice awarded $27,043.84 to QUEST DIAGNOSTICS INCORPORATED. FY26 QUEST DIAGNOSTICS -POP JAN-MARCH
Who is the contractor on this award?
The obligated recipient is QUEST DIAGNOSTICS INCORPORATED.
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 $27,043.84.
What is the period of performance?
Start: 2026-01-20. End: 2026-03-31.
What is the average cost per test or service provided under this contract, and how does it compare to industry benchmarks?
The provided data lacks the specific breakdown of services and their associated costs, making a direct per-unit cost comparison impossible. To assess value, a detailed analysis of the services rendered (e.g., specific lab tests) and their quantities is required. This would then allow for comparison against publicly available pricing data for similar medical laboratory services to determine if the $27M award represents a fair market price.
What are the specific risks associated with using a single vendor, Quest Diagnostics, for this contract, even if awarded competitively?
Even with full and open competition, relying on a single vendor like Quest Diagnostics for a significant contract carries risks. These include potential price increases in future renewals, reduced incentive for innovation if competition is not sustained, and vulnerability to service disruptions if the vendor faces operational issues. The limited contract duration (70 days) might mitigate some long-term risks but suggests a potential ongoing need that could lead to vendor lock-in.
How effectively does the BPA call mechanism ensure optimal price discovery and value for taxpayer money in this scenario?
The BPA call mechanism, when executed properly under full and open competition, can facilitate price discovery by allowing multiple vendors to bid. However, the effectiveness hinges on the clarity of the requirements, the number of qualified bidders responding to the call, and the evaluation criteria used. If the call was narrowly defined or if only a few vendors participated, the price discovery might be suboptimal, potentially leading to higher costs than a more broadly competed contract.
Industry Classification
NAICS: Health Care and Social Assistance › Medical and Diagnostic Laboratories › Medical Laboratories
Product/Service Code: MEDICAL SERVICES › LABORATORY TESTING SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 500 PLAZA DR, SECAUCUS, NJ, 07094
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $27,044
Exercised Options: $27,044
Current Obligation: $27,044
Actual Outlays: $11,941
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 15BNAS26A00000038
IDV Type: BPA
Timeline
Start Date: 2026-01-20
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 00:00:00
Last Modified: 2026-04-03
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