VA's July 2024 Medical Surgical Prime Vendor Spending Reaches $27.6M with Medline Industries

Contract Overview

Contract Amount: $27,607,507 ($27.6M)

Contractor: Medline Industries, LP

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-07-01

End Date: 2024-07-31

Contract Duration: 30 days

Daily Burn Rate: $920.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS REPORT: MEDICAL SURGICAL PRIME VENDOR EXPENDITURES FOR THE MONTH OF JULY 2024

Place of Performance

Location: NORTHFIELD, COOK County, ILLINOIS, 60093

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $27.6 million to MEDLINE INDUSTRIES, LP for work described as: EXPRESS REPORT: MEDICAL SURGICAL PRIME VENDOR EXPENDITURES FOR THE MONTH OF JULY 2024 Key points: 1. Significant monthly expenditure of $27.6M on medical surgical supplies. 2. Sole vendor, Medline Industries, LP, dominates this spending category. 3. Lack of competition raises concerns about potential price inflation. 4. Spending is concentrated in Surgical and Medical Instrument Manufacturing (NAICS 339112).

Value Assessment

Rating: questionable

The $27.6M expenditure for July 2024 represents a substantial outlay. Without competitive benchmarks or detailed pricing breakdowns, it's difficult to definitively assess value. However, the lack of competition suggests potential for higher-than-market pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This limits price discovery and negotiation leverage, potentially leading to less favorable pricing for the government compared to a competitive environment.

Taxpayer Impact: The absence of competition may result in taxpayers paying a premium for medical surgical supplies.

Public Impact

Veterans' access to essential medical supplies is maintained. Potential for increased costs impacts the VA's overall budget allocation. Lack of transparency in pricing may hinder public trust. Reliance on a single vendor could pose supply chain risks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
No clear price benchmarks

Positive Signals

Consistent supply delivery
Supports critical healthcare operations

Sector Analysis

The Department of Veterans Affairs relies heavily on vendors for medical surgical supplies to support healthcare services. Benchmarks for this sector are highly variable based on specific items, but consistent sole-source awards without re-competition warrant scrutiny.

Small Business Impact

There is no indication of small business participation in this specific contract award. Further analysis would be needed to determine if subcontracting opportunities were explored or if small businesses were excluded.

Oversight & Accountability

The contract was awarded as a delivery order under an existing arrangement, suggesting some level of prior oversight. However, the lack of re-competition for this significant expenditure raises questions about ongoing oversight and value assessment.

Related Government Programs

Surgical and Medical Instrument Manufacturing
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Lack of competitive bidding
Potential for price gouging
Supply chain vulnerability
Limited vendor options
Insufficient price transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $27.6 million to MEDLINE INDUSTRIES, LP. EXPRESS REPORT: MEDICAL SURGICAL PRIME VENDOR EXPENDITURES FOR THE MONTH OF JULY 2024

Who is the contractor on this award?

The obligated recipient is MEDLINE INDUSTRIES, LP.

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 $27.6 million.

What is the period of performance?

Start: 2024-07-01. End: 2024-07-31.

What is the historical pricing trend for these supplies under this vendor?

Historical pricing data is crucial for assessing value. Without it, it's impossible to determine if the current $27.6M expenditure represents an increase or decrease over time. Analyzing past invoices and comparing them to market indices would reveal if Medline Industries has maintained competitive pricing or if costs have escalated due to the lack of competition.

What are the risks associated with relying solely on Medline Industries for these critical supplies?

Sole reliance on Medline Industries presents several risks. Supply chain disruptions, whether due to geopolitical events, natural disasters, or the vendor's own operational issues, could severely impact the VA's ability to procure essential medical supplies. Furthermore, a lack of competition can lead to complacency and potentially lower service quality over time.

How does this monthly expenditure compare to similar contracts within the federal government?

Direct comparison is challenging without knowing the exact product mix and quantities. However, $27.6M monthly for medical surgical supplies is a substantial figure. Benchmarking against other agencies' prime vendor contracts for similar scope, adjusted for volume and item specifics, would help determine if this represents efficient spending or an area of potential overpayment.

Industry Classification

NAICS: Manufacturing › Medical Equipment and Supplies Manufacturing › Surgical and Medical Instrument Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3 LAKES DR, NORTHFIELD, IL, 60093

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,607,507

Exercised Options: $27,607,507

Current Obligation: $27,607,507

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10X23D0003

IDV Type: IDC

Timeline