VA awards $276M task order to QTC Medical Services for physician services in California

Contract Overview

Contract Amount: $276,012,473 ($276.0M)

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: $756.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: FY24 FUNDING TASK ORDER.

Place of Performance

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

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $276.0 million to QTC MEDICAL SERVICES INC for work described as: FY24 FUNDING TASK ORDER. Key points: 1. Contract value represents a significant investment in healthcare services for veterans. 2. Competition dynamics for this contract are crucial for ensuring fair pricing. 3. Performance context will be key to evaluating the effectiveness of QTC Medical Services. 4. This contract positions QTC within the broader federal healthcare services sector. 5. Risk indicators will focus on service delivery quality and patient outcomes.

Value Assessment

Rating: good

The $276 million task order for physician services is substantial. Benchmarking against similar contracts for medical examination services awarded by the VA or other agencies would provide a clearer picture of value for money. Given the fixed-price nature, the primary value assessment will hinge on the quality and timeliness of services delivered relative to the cost. Without direct comparable contract data, it's difficult to definitively state if the pricing is optimal, but the scale suggests a competitive bid process was likely employed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely invited to submit proposals. The presence of full and open competition generally fosters a more robust price discovery process, as contractors vie to offer the most competitive terms. The number of bidders and the specific evaluation criteria would further illuminate the intensity of this competition and its potential impact on the final award price.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to more competitive pricing and a wider selection of qualified contractors, maximizing the value of federal dollars spent.

Public Impact

Veterans in California will benefit from access to physician services. The contract supports the delivery of medical examination services. Geographic impact is concentrated within California. This contract likely supports a workforce of physicians and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Ensuring consistent quality of care across all service locations.
Monitoring contractor performance to meet service level agreements.
Managing potential fluctuations in demand for services.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Fixed-price contract type can provide cost certainty.
Long-term nature of the contract allows for stable service provision.

Sector Analysis

The federal healthcare services sector is a large and complex market, with significant spending directed towards medical services for veterans and active-duty military personnel. This contract falls under the Offices of Physicians (except Mental Health Specialists) NAICS code, a critical component of healthcare delivery. Comparable spending benchmarks would involve analyzing other large-scale medical examination contracts awarded by the Department of Defense and the VA, which often exceed hundreds of millions of dollars annually.

Small Business Impact

While this contract was awarded under full and open competition and does not explicitly mention small business set-asides, it is important to assess subcontracting opportunities. Large prime contractors often engage small businesses for specialized services or support functions. The extent to which QTC Medical Services utilizes small business subcontractors will impact the small business ecosystem and their ability to secure federal contracts.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs contracting officers and program managers. Accountability measures will be tied to performance metrics outlined in the task order, such as timeliness of appointments, quality of reports, and patient satisfaction. Transparency is facilitated through contract award databases, though detailed performance reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

VA Medical Care
TRICARE Medical Services
DoD Medical Examination Services

Risk Flags

Potential for service delays
Quality assurance of medical evaluations
Contractor staffing levels
Patient satisfaction metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $276.0 million to QTC MEDICAL SERVICES INC. FY24 FUNDING TASK ORDER.

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 $276.0 million.

What is the period of performance?

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

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

QTC Medical Services has a significant history of providing medical examination and diagnostic services to the Department of Veterans Affairs (VA) and the Department of Defense (DoD). They are a well-established contractor in this space, often handling large volumes of claims-related examinations. Their performance history with the VA includes numerous task orders and contracts, some of which have been substantial in value. While generally considered a capable provider, like any large contractor, there have been instances of scrutiny regarding service delivery times and quality in specific regions or for particular contract types. A detailed review of past performance evaluations and any corrective actions taken would provide a more comprehensive understanding of their track record.

How does the $276 million value of this task order compare to similar contracts for physician services awarded by the VA?

The $276 million value for this single task order is substantial and falls within the upper range of large-scale medical examination contracts awarded by the VA. The VA frequently awards multi-year contracts and task orders in the hundreds of millions of dollars for comprehensive medical examination services across various regions. For instance, other major contracts for similar services have also been in the range of $100 million to over $500 million. This specific award to QTC Medical Services for services in California appears to be a significant, but not unprecedented, investment for the agency, reflecting the ongoing need for these critical veteran health services.

What are the primary risk indicators associated with a contract of this magnitude for physician services?

Key risk indicators for a contract of this magnitude include potential issues with service delivery timeliness, ensuring consistent quality of medical evaluations across numerous providers, and managing the administrative overhead associated with a large contract. There's also a risk of contractor performance degradation over time if oversight is not rigorous. Patient satisfaction and the accuracy of medical assessments are paramount, and any failures in these areas could lead to significant negative impacts on veterans' benefits and care. Furthermore, ensuring adequate staffing levels and provider qualifications across the contracted region presents an ongoing operational risk.

How effective is the current contract structure in ensuring program effectiveness for veteran healthcare?

The effectiveness of this contract structure hinges on the specific performance metrics and service level agreements (SLAs) established within the task order. A fixed-price contract, while offering cost certainty, requires robust monitoring to ensure that cost savings do not come at the expense of service quality or timeliness. The VA's program effectiveness will be measured by its ability to ensure veterans receive timely, accurate, and comprehensive medical examinations that support their healthcare needs and benefit claims. Regular performance reviews, data analysis of appointment wait times, and feedback mechanisms from veterans are crucial for assessing and ensuring the ongoing effectiveness of the program delivered under this contract.

What are the historical spending patterns for physician services by the Department of Veterans Affairs over the last five fiscal years?

The Department of Veterans Affairs has consistently allocated significant funding towards medical services, including physician services, over the past five fiscal years. Annual spending in this category has generally trended upwards, reflecting increased demand for veteran healthcare and expanded services. While precise figures for 'physician services' as a distinct category can vary based on reporting methodologies, overall medical care spending by the VA has been in the tens of billions of dollars annually. Contracts for medical examinations, diagnostic services, and direct physician support constitute a substantial portion of this expenditure, often awarded through competitive processes to both large and small businesses.

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: $276,012,473

Exercised Options: $276,012,473

Current Obligation: $276,012,473

Actual Outlays: $233,621,181

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10X22D0007

IDV Type: IDC

Timeline