VA awards $1.94B contract to TriWest Healthcare Alliance Corp for health and medical insurance carriers
Contract Overview
Contract Amount: $1,943,190,123 ($1.9B)
Contractor: Triwest Healthcare Alliance Corp
Awarding Agency: Department of Veterans Affairs
Start Date: 2019-08-06
End Date: 2027-03-31
Contract Duration: 2,794 days
Daily Burn Rate: $695.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: EXPRESS REPORT: QUARTER 2
Place of Performance
Location: FREDERICKSBURG, SPOTSYLVANIA County, VIRGINIA, 22408
State: Virginia Government Spending
Plain-Language Summary
Department of Veterans Affairs obligated $1.94 billion to TRIWEST HEALTHCARE ALLIANCE CORP for work described as: EXPRESS REPORT: QUARTER 2 Key points: 1. The contract value of $1.94 billion represents a significant investment in healthcare services. 2. Competition was full and open, suggesting a competitive bidding process. 3. The contract duration is long (2794 days), indicating a sustained need for these services. 4. The sector is healthcare, specifically direct health and medical insurance carriers.
Value Assessment
Rating: good
The award amount is substantial, but without specific per-unit cost data or benchmarks for similar long-term health insurance contracts, a precise value assessment is difficult. The firm fixed-price structure provides cost certainty.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically drives competitive pricing and ensures the government receives the best value. The delivery order structure suggests it's part of a larger framework.
Taxpayer Impact: The competitive nature of the award is positive for taxpayers, as it likely resulted in a more favorable price than a sole-source or limited competition contract.
Public Impact
Veterans will benefit from continued access to direct health and medical insurance services. The long contract duration provides stability for service providers and beneficiaries. The use of firm fixed-price contracts helps manage budget predictability for the VA.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration could lead to price escalation if not managed.
- Potential for scope creep over the contract's lifespan.
Positive Signals
- Full and open competition ensures market forces drive value.
- Firm fixed-price contract provides cost certainty.
Sector Analysis
This contract falls within the Healthcare sector, specifically focusing on direct health and medical insurance carriers. Spending in this area is critical for government healthcare providers like the VA, and benchmarks vary widely based on service scope and population served.
Small Business Impact
The data does not indicate whether small businesses were involved as subcontractors or prime contractors in this award. Further analysis would be needed to determine the extent of small business participation.
Oversight & Accountability
The Department of Veterans Affairs is responsible for overseeing this contract. The long duration necessitates robust oversight to ensure performance standards are met and costs remain aligned with value.
Related Government Programs
- Direct Health and Medical Insurance Carriers
- Department of Veterans Affairs Contracting
- Department of Veterans Affairs Programs
Risk Flags
- Long contract duration (over 7 years).
- Large contract value ($1.94 billion).
- Potential for scope creep over time.
- Lack of detailed cost-per-unit data for benchmarking.
Tags
direct-health-and-medical-insurance-carr, department-of-veterans-affairs, va, delivery-order, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Veterans Affairs awarded $1.94 billion to TRIWEST HEALTHCARE ALLIANCE CORP. EXPRESS REPORT: QUARTER 2
Who is the contractor on this award?
The obligated recipient is TRIWEST HEALTHCARE ALLIANCE CORP.
Which agency awarded this contract?
Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).
What is the total obligated amount?
The obligated amount is $1.94 billion.
What is the period of performance?
Start: 2019-08-06. End: 2027-03-31.
What is the projected cost per beneficiary or per service under this contract, and how does it compare to industry benchmarks?
The provided data lacks specific cost-per-beneficiary or cost-per-service metrics. To assess value effectively, a comparison against industry benchmarks for similar health insurance contracts, considering the specific services covered and the veteran population demographics, would be necessary. This would reveal if the $1.94 billion award represents efficient spending or potential overpayment.
What are the key performance indicators (KPIs) and service level agreements (SLAs) for this contract, and how will they be monitored?
The data does not detail the specific KPIs and SLAs. Effective oversight requires clearly defined performance metrics related to access to care, quality of service, and patient satisfaction. Regular monitoring and reporting against these metrics are crucial to ensure TriWest Healthcare Alliance Corp is meeting its contractual obligations and delivering value to veterans.
How will the VA ensure continued cost-effectiveness and adapt to potential changes in healthcare needs over the contract's 7+ year duration?
The firm fixed-price nature provides initial cost certainty. However, the VA must implement mechanisms for periodic review and potential adjustments, especially considering evolving healthcare needs and potential inflation. Proactive contract management, including performance reviews and market analysis, will be key to maintaining cost-effectiveness and adapting the contract's scope if necessary.
Industry Classification
NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers
Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 15810 N 28TH AVE, PHOENIX, AZ, 85053
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,943,190,123
Exercised Options: $1,943,190,123
Current Obligation: $1,943,190,123
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 36C10G19D0038
IDV Type: IDC
Timeline
Start Date: 2019-08-06
Current End Date: 2027-03-31
Potential End Date: 2027-03-31 00:00:00
Last Modified: 2023-12-01
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