VA awards $190.6M for medical disability exams in Northeast region, with QTC Medical Services Inc. as prime contractor

Contract Overview

Contract Amount: $190,608,790 ($190.6M)

Contractor: QTC Medical Services Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-10-01

End Date: 2023-09-30

Contract Duration: 364 days

Daily Burn Rate: $523.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MEDICAL DISABILITY EXAMINATIONS (MDES) UNDER SECTION 504 OF THE VETERANS BENEFITS IMPROVEMENTS ACT OF 1996 (PUBLIC LAW 104 275 38 U.S.C. 5101), REGION 1 (NORTHEAST) - MODIFICATION TO EXERCISE OPTION PERIOD 4

Place of Performance

Location: SAN DIMAS, LOS ANGELES County, CALIFORNIA, 91773

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $190.6 million to QTC MEDICAL SERVICES INC for work described as: MEDICAL DISABILITY EXAMINATIONS (MDES) UNDER SECTION 504 OF THE VETERANS BENEFITS IMPROVEMENTS ACT OF 1996 (PUBLIC LAW 104 275 38 U.S.C. 5101), REGION 1 (NORTHEAST) - MODIFICATION TO EXERCISE OPTION PERIOD 4 Key points: 1. Contract focuses on essential medical disability examinations to support veterans' benefits claims. 2. The award represents a significant investment in veteran healthcare services. 3. Performance period spans one year, indicating a defined scope of work. 4. The contract type is Firm Fixed Price, which helps manage cost certainty. 5. The geographic focus is Region 1 (Northeast), serving a critical veteran population. 6. This contract is a modification to exercise an option period, suggesting prior performance. 7. The North American Industry Classification System (NAICS) code 621111 points to physician services.

Value Assessment

Rating: good

The contract value of $190.6 million for a one-year period for medical disability examinations appears substantial. Benchmarking against similar large-scale contracts for veteran medical evaluations would be necessary for a precise value-for-money assessment. However, given the specialized nature of these examinations and the large number of veterans served, the pricing may be competitive within the market for such services. The firm fixed-price structure provides cost predictability for the VA.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the competitive nature of the award process suggests that the VA sought to obtain the best value through a robust bidding environment. This approach generally leads to more favorable pricing and service offerings.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down costs through market forces and encourages innovation among service providers, ensuring efficient use of public funds.

Public Impact

Veterans in the Northeast region will benefit from timely and accurate medical disability examinations. These examinations are crucial for determining eligibility and levels of compensation for various VA benefits. The services delivered will support the Department of Veterans Affairs' mission to care for its veterans. The contract has implications for the healthcare workforce, potentially creating or sustaining jobs for medical professionals and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased workload on QTC Medical Services Inc. given the contract value.
Ensuring consistent quality of examinations across a large geographic region can be challenging.
Dependence on a single contractor for a critical service raises concerns about service continuity if issues arise.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Firm Fixed Price contract type provides cost certainty for the government.
Modification to exercise an option period indicates satisfactory past performance.
Focus on a specific region allows for targeted service delivery and management.

Sector Analysis

The healthcare services sector, particularly within the government contracting space, is highly competitive. This contract falls under the physician services sub-sector, which is essential for the functioning of the broader healthcare system. The Department of Veterans Affairs is a major procurer of medical services, and contracts like this represent a significant portion of their spending to meet the healthcare needs of veterans. Comparable spending benchmarks would involve analyzing other large contracts for similar medical examination services across different government agencies or regions.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a primary set-aside criterion for this specific contract. While QTC Medical Services Inc. is the prime contractor, there is no explicit information on subcontracting plans for small businesses within this award. Further analysis would be needed to determine if subcontracting opportunities exist and how they might impact the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Veterans Affairs contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and managing payments. Transparency is facilitated through contract award databases and reporting requirements. The Inspector General's office within the VA may also conduct audits or investigations into the contract's execution and financial management.

Related Government Programs

Veterans Health Administration Medical Services
VA Disability Compensation Program
TRICARE Medical Services
Federal Employee Health Benefits Program Medical Services

Risk Flags

Potential for service delivery delays
Quality assurance concerns
Workforce availability challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $190.6 million to QTC MEDICAL SERVICES INC. MEDICAL DISABILITY EXAMINATIONS (MDES) UNDER SECTION 504 OF THE VETERANS BENEFITS IMPROVEMENTS ACT OF 1996 (PUBLIC LAW 104 275 38 U.S.C. 5101), REGION 1 (NORTHEAST) - MODIFICATION TO EXERCISE OPTION PERIOD 4

Who is the contractor on this award?

The obligated recipient is QTC MEDICAL SERVICES INC.

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 $190.6 million.

What is the period of performance?

Start: 2022-10-01. End: 2023-09-30.

What is the historical spending trend for Medical Disability Examinations (MDES) by the Department of Veterans Affairs in Region 1?

Analyzing historical spending for MDES in Region 1 requires access to detailed VA procurement data over several fiscal years. Typically, such contracts are awarded through competitive processes, and their value can fluctuate based on veteran population growth, changes in benefits eligibility, and the number of claims processed. Option periods, like the one exercised here, suggest a continuation of services, implying a consistent need. A trend analysis would involve comparing the current $190.6 million award to previous years' spending on similar services in the same region to identify any significant increases or decreases, which could be driven by policy changes, increased demand, or shifts in contracting strategies. Without specific historical data, it's difficult to pinpoint precise trends, but the substantial value of this award suggests a sustained and significant requirement for these services.

How does the per-veteran cost of these medical disability examinations compare to national averages or similar contracts?

Determining the per-veteran cost requires knowing the total number of examinations performed under this contract and dividing the total contract value by that number. Benchmarking this figure against national averages or similar contracts is crucial for assessing value for money. Factors influencing per-veteran cost include the complexity of examinations, geographic distribution of veterans, and the efficiency of the service provider. If the per-veteran cost is significantly higher than comparable contracts or national benchmarks, it could indicate potential inefficiencies or pricing issues. Conversely, a lower cost might suggest effective service delivery and competitive pricing. A detailed analysis would involve obtaining the volume of services delivered and comparing the resulting unit cost to industry standards and other VA contracts for similar services.

What is QTC Medical Services Inc.'s track record with the Department of Veterans Affairs and other federal agencies?

QTC Medical Services Inc. has a significant history of providing medical examination services to the Department of Veterans Affairs (VA) and other federal agencies. As a prime contractor on numerous awards, their track record involves delivering services such as Compensation and Pension (C&P) examinations, which are critical for veterans' benefits claims. Performance evaluations and past performance reviews, often available through federal procurement databases, would provide insights into their reliability, quality of service, and adherence to contract requirements. Examining their history with the VA, including any past issues, contract disputes, or commendations, is essential for understanding their capabilities and suitability for large-value contracts like this one. Their continued selection for significant contracts suggests a generally positive performance history, though a deeper dive into specific contract performance metrics is warranted.

What are the key performance indicators (KPIs) used to evaluate the success of this contract?

Key Performance Indicators (KPIs) for a contract like this typically focus on timeliness, quality, and efficiency of medical disability examinations. Common KPIs include the average turnaround time for completing examinations from request to report submission, the accuracy and completeness of examination reports, veteran satisfaction scores, and adherence to VA clinical guidelines. For example, the VA might set targets for the percentage of reports submitted within a specified number of days (e.g., 30 days) or require a certain level of quality assurance compliance. Performance against these KPIs directly impacts the contractor's ability to meet contractual obligations and potentially influences future contract awards. Monitoring these metrics ensures that veterans receive timely and accurate assessments, which is critical for the fair adjudication of their benefits claims.

Are there any identified risks associated with the performance of QTC Medical Services Inc. on this contract?

Potential risks associated with this contract could include challenges in recruiting and retaining qualified medical professionals across the Northeast region, ensuring consistent quality of examinations across diverse geographic locations, and managing the logistical complexities of scheduling appointments for a large veteran population. Furthermore, any significant delays in report submission or a decline in the quality of examinations could lead to backlogs in VA claims processing, impacting veterans. Dependence on a single large contractor also presents a risk if the contractor experiences financial instability or major operational disruptions. The VA's oversight mechanisms, including performance monitoring and quality assurance processes, are designed to mitigate these risks.

Industry Classification

NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians (except Mental Health Specialists)

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: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leidos Holdings, Inc.

Address: 924 OVERLAND CT, SAN DIMAS, CA, 91773

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $190,608,790

Exercised Options: $190,608,790

Current Obligation: $190,608,790

Actual Outlays: $184,608,845

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10X19D0002

IDV Type: IDC

Timeline