VA awards $305M task order to QTC Medical Services for physician services in FY24

Contract Overview

Contract Amount: $304,763,926 ($304.8M)

Contractor: QTC Medical Services Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-10-01

End Date: 2024-09-30

Contract Duration: 365 days

Daily Burn Rate: $835.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MDE FY24 FUNDING TASK ORDER - SUBJECT TO THE AVAILABILITY OF FUNDS

Place of Performance

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

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $304.8 million to QTC MEDICAL SERVICES INC for work described as: MDE FY24 FUNDING TASK ORDER - SUBJECT TO THE AVAILABILITY OF FUNDS Key points: 1. Contract value represents a significant investment in physician services for the VA. 2. Full and open competition was utilized, suggesting a potentially competitive bidding process. 3. The contract is a delivery order, indicating it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 4. Performance period aligns with the federal fiscal year 2024. 5. The North American Industry Classification System (NAICS) code 621111 points to a focus on physician office services. 6. The contract is firm-fixed-price, providing cost certainty for the government.

Value Assessment

Rating: good

The awarded amount of $304.8 million for a one-year period is substantial for physician services. Benchmarking against similar contracts for physician services within the VA or other federal agencies would be necessary for a precise value-for-money assessment. However, the firm-fixed-price structure generally offers good cost control. The prior benchmark of $834,970 suggests this task order is a significant increase or a new, larger requirement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. This method typically fosters a competitive environment, which can lead to better pricing and service quality. The number of bidders is not specified, but the use of this procurement method suggests a deliberate effort to maximize competition.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a wide range of potential providers, potentially driving down costs and improving service delivery.

Public Impact

Veterans will benefit from access to physician services, potentially improving healthcare outcomes. The contract supports the delivery of medical services, specifically from physician offices. Services are likely concentrated in California, based on the 'SN' field indicating 'CALIFORNIA'. This contract supports employment within the healthcare sector, particularly for physicians and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased workload on QTC Medical Services, requiring robust management.
Dependence on a single contractor for a large volume of services could pose a risk if performance falters.

Positive Signals

Firm-fixed-price contract provides budget certainty for the VA.
Full and open competition suggests a deliberate effort to obtain competitive pricing.
The contract is for a defined period, allowing for re-evaluation of needs and contractors.

Sector Analysis

The healthcare services sector, particularly the provision of physician services, is a critical component of the federal healthcare system. The NAICS code 621111 specifically targets offices of physicians. Spending in this area is consistently high across federal agencies, especially the Department of Veterans Affairs, which relies on a network of providers to serve its beneficiaries. This contract fits within the broader landscape of federal healthcare procurement, aiming to ensure access to medical expertise.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions or subcontracting requirements for this particular task order. Therefore, the direct impact on small businesses is not evident from this data alone. Further analysis would be needed to determine if subcontracting opportunities exist or if the prime contractor has a history of engaging small businesses.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting and program management offices. As a delivery order under an IDIQ, the underlying contract likely has established oversight mechanisms. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Veterans Affairs Medical Care Programs
Federal Healthcare Services Contracts
Physician Services Procurement
Indefinite Delivery/Indefinite Quantity (IDIQ) Contracts

Risk Flags

Large contract value concentrated with a single provider.
Potential for performance degradation due to scale.
Dependence on contractor's ability to meet demand in specific geographic areas.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $304.8 million to QTC MEDICAL SERVICES INC. MDE FY24 FUNDING TASK ORDER - SUBJECT TO THE AVAILABILITY OF FUNDS

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 $304.8 million.

What is the period of performance?

Start: 2023-10-01. End: 2024-09-30.

What is the historical performance and track record of QTC Medical Services Inc. with the Department of Veterans Affairs?

QTC Medical Services Inc. has a significant history of contracting with the Department of Veterans Affairs, primarily for providing medical examination and diagnostic services to veterans. They are a major contractor in this space, often handling pre-discharge, disability, and compensation and pension examinations. Their performance history with the VA is extensive, with numerous awards and task orders issued over many years. While generally considered a capable provider, like any large contractor, there have been instances of scrutiny regarding wait times, data accuracy, and overall service efficiency. The VA's contract management and oversight processes are designed to monitor and address any performance deficiencies. A detailed review of past performance evaluations and any corrective actions would provide a more granular understanding of their track record.

How does the $305 million FY24 task order value compare to previous spending with QTC Medical Services for similar physician services?

The $304.8 million value for this FY24 task order is substantial and represents a significant portion of the VA's spending on physician services for the year. Without knowing the specific services covered under this task order and comparing it to the 'prior benchmark' of $834,970, it's difficult to make a direct comparison. If this task order is for a new or expanded scope of services, or if it represents a consolidation of previous smaller requirements, the value could be justified. However, if it's a continuation of existing services, this figure warrants scrutiny to ensure it aligns with market rates and historical spending trends for comparable services. The VA's historical spending data would be crucial for a precise comparison.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this task order?

While the specific KPIs and SLAs for this task order are not detailed in the provided data, they are critical components of any government contract, especially for healthcare services. Typically, for physician services, KPIs would likely include metrics related to appointment availability (e.g., time to schedule an appointment), turnaround time for medical reports, accuracy and completeness of documentation, patient satisfaction scores, and adherence to clinical protocols. SLAs would define the expected performance standards and potential remedies or penalties for non-compliance. The firm-fixed-price nature of the contract suggests that the government is seeking specific outcomes and deliverables within a set budget, making these performance metrics essential for ensuring value and quality of care for veterans.

What is the risk assessment associated with awarding a $305 million task order to a single contractor?

Awarding a $305 million task order to a single contractor like QTC Medical Services Inc. carries inherent risks, primarily related to performance and dependency. If QTC Medical Services experiences significant operational issues, staffing shortages, or management problems, it could disrupt the delivery of essential physician services to veterans, potentially leading to delays in care or examinations. The large contract value also means a substantial portion of the VA's physician service needs are concentrated with one entity, increasing the impact of any failure. Mitigation strategies would include robust contract oversight by the VA, clear performance standards, contingency planning, and potentially maintaining relationships with other providers for surge capacity or backup. The government must actively monitor performance to ensure risks are managed effectively.

How does the geographic focus on California (SN: CALIFORNIA) impact the overall delivery and accessibility of these physician services?

The designation 'SN: CALIFORNIA' strongly suggests that this task order is primarily focused on delivering physician services within the state of California. This geographic concentration can have several implications. It allows for a more tailored approach to meeting the specific needs of veterans in California, potentially leading to more efficient service delivery if QTC has established infrastructure and personnel in the region. However, it also means that veterans outside of California may not directly benefit from this specific task order, requiring separate contracting efforts for other geographic areas. Furthermore, the success of this task order will heavily depend on QTC's capacity and network of providers within California to meet the demand effectively and avoid long wait times or accessibility issues for veterans in that state.

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: $304,763,926

Exercised Options: $304,763,926

Current Obligation: $304,763,926

Actual Outlays: $273,357,524

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10X19D0002

IDV Type: IDC

Timeline