VA awards $2.27M for urgent lab testing to Laboratory Corporation of America, highlighting a need for rapid diagnostic services

Contract Overview

Contract Amount: $2,269,450 ($2.3M)

Contractor: Laboratory Corporation of America

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-07-01

End Date: 2025-12-31

Contract Duration: 183 days

Daily Burn Rate: $12.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: URGENT REF LAB TESTING

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10010

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.3 million to LABORATORY CORPORATION OF AMERICA for work described as: URGENT REF LAB TESTING Key points: 1. The contract's value appears reasonable given the critical nature of urgent lab testing, though specific performance metrics are needed for a full value assessment. 2. Full and open competition was utilized, suggesting a healthy market for these services and potential for competitive pricing. 3. The short duration (183 days) indicates a need for immediate or short-term support, potentially for surge capacity or specific project requirements. 4. This contract falls within the Medical Laboratories (NAICS 621511) sector, a vital component of healthcare infrastructure. 5. The fixed-price contract type helps mitigate cost overrun risks for the government.

Value Assessment

Rating: good

The contract value of $2.27 million for approximately six months of urgent lab testing services seems aligned with market rates for such critical healthcare support. Benchmarking against similar sole-source or limited-competition contracts for urgent medical services would provide further context. The firm fixed-price structure offers cost certainty. However, without detailed performance standards or comparison to pre-negotiated rates for specific tests, a definitive value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. This approach generally fosters a competitive environment, driving down prices and encouraging innovation. The specific number of bidders is not provided, but the method suggests a robust market for medical laboratory services capable of handling urgent testing needs.

Taxpayer Impact: Taxpayers benefit from the competitive bidding process, which is expected to yield a fair market price for essential laboratory services and prevent overpayment.

Public Impact

Veterans receiving care from the Department of Veterans Affairs will benefit from timely and accurate laboratory test results. Essential diagnostic services will be delivered, supporting clinical decision-making and patient treatment plans. The services are geographically focused on New York (ST: NY, SN: NEW YORK), impacting veterans in that region. This contract supports the healthcare workforce within the medical laboratory sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the quality and timeliness of the urgent testing.
The contract's short duration might indicate a reactive approach rather than proactive capacity planning.
Limited information on the specific types of 'urgent' tests required could obscure potential cost drivers.

Positive Signals

Awarded under full and open competition, suggesting a competitive market and fair pricing.
Firm fixed-price contract type provides cost predictability for the VA.
The contract addresses a critical need for urgent laboratory services, ensuring timely patient care.

Sector Analysis

The Medical Laboratories sector (NAICS 621511) is a critical part of the healthcare industry, providing essential diagnostic testing services. This contract fits within the broader healthcare services market, which is characterized by high demand, technological advancements, and significant government spending. Comparable spending benchmarks for laboratory services can vary widely based on test complexity, volume, and geographic location. The VA's reliance on large national providers like Laboratory Corporation of America is common for specialized or high-volume testing needs.

Small Business Impact

There is no indication that this contract includes a small business set-aside. Given the nature of urgent, large-scale laboratory testing, it is likely that larger, established companies with extensive infrastructure and specialized capabilities are best positioned to compete. Subcontracting opportunities for small businesses may exist, but are not explicitly detailed in the provided data. The impact on the small business ecosystem is likely minimal unless specific subcontracting plans are mandated.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Veterans Affairs contracting officers and program managers. Accountability measures are inherent in the firm fixed-price structure, which obligates the contractor to deliver services at the agreed-upon price. Transparency is facilitated by the contract award itself being publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Veterans Affairs Medical Services Contracts
Federal Healthcare Services
Diagnostic Laboratory Services
Urgent Medical Needs Contracts

Risk Flags

Potential for service disruption if contractor faces unforeseen issues.
Dependence on a single vendor for critical, time-sensitive services.
Lack of detailed performance metrics in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.3 million to LABORATORY CORPORATION OF AMERICA. URGENT REF LAB TESTING

Who is the contractor on this award?

The obligated recipient is LABORATORY CORPORATION OF AMERICA.

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 $2.3 million.

What is the period of performance?

Start: 2025-07-01. End: 2025-12-31.

What is the historical spending pattern of the Department of Veterans Affairs on urgent laboratory testing services?

Analyzing historical spending data for urgent laboratory testing by the VA is crucial for understanding trends, identifying potential increases or decreases in demand, and assessing the consistency of contractor selection. While specific data for 'urgent' testing is not readily available in this summary, the VA generally spends billions annually on healthcare services, including laboratory diagnostics. Examining past contracts awarded to Laboratory Corporation of America and other major lab providers for similar services over the last 5-10 years would reveal patterns in contract values, durations, and competition levels. This historical context helps determine if the current $2.27 million award is an anomaly or part of a sustained investment in rapid diagnostic capabilities.

How does the per-unit cost of services under this contract compare to other VA contracts or market rates for similar laboratory tests?

A detailed comparison of per-unit costs is challenging without knowing the specific tests included in this 'urgent lab testing' contract. However, the VA often negotiates national or regional agreements with large laboratory providers that may offer volume discounts. Benchmarking against publicly available price lists from Laboratory Corporation of America or other major clinical laboratories, adjusted for geographic location and potential volume, can provide an initial estimate. Comparing this contract's implied per-unit costs to previously awarded VA contracts for similar services, especially those also competed broadly, would offer a more direct comparison. If this contract is significantly higher or lower than benchmarks, it warrants further investigation into the reasons, such as urgency premiums, specific test panels, or unique service requirements.

What are the specific performance expectations and quality metrics associated with this urgent lab testing contract?

The provided data does not specify the performance expectations or quality metrics for this contract. For 'urgent' lab testing, key metrics would typically include turnaround time (TAT) for results, accuracy rates, specimen integrity, and potentially customer service responsiveness. The VA likely has internal standards or requirements outlined in the Performance Work Statement (PWS) that are not detailed here. Assessing the contractor's track record with the VA or other federal agencies on similar contracts, focusing on their historical performance against TAT and accuracy benchmarks, would be essential. Without these details, it's difficult to fully evaluate the quality and effectiveness of the services being procured.

What is Laboratory Corporation of America's track record with the Department of Veterans Affairs and other federal agencies?

Laboratory Corporation of America (Labcorp) is a major national provider of laboratory services and has a significant history of contracting with the Department of Veterans Affairs (VA) and other federal agencies, including the Department of Defense and Health and Human Services. Their track record typically involves providing a wide range of diagnostic testing, often through large, multi-year agreements. While specific performance details for past VA contracts are not provided here, Labcorp generally possesses the infrastructure and expertise to handle large volumes of testing. Past performance evaluations, if available through federal procurement databases or agency reports, would offer insights into their reliability, quality of service, and adherence to contract terms in previous engagements.

What is the potential risk associated with relying on a single vendor for urgent laboratory testing, even if competed?

Even though this contract was awarded under full and open competition, relying on a single vendor for 'urgent' laboratory testing introduces potential risks. These include service disruptions due to unforeseen issues with the contractor (e.g., equipment failure, staffing shortages, natural disasters), potential price increases in future contract renewals if competition diminishes, and a reduced ability to quickly pivot to alternative providers if needs change rapidly. The short duration of this specific contract mitigates some long-term risk, but the VA remains dependent on Labcorp for the defined period. Diversifying laboratory service providers or establishing robust contingency plans could further reduce reliance risk.

Industry Classification

NAICS: Health Care and Social Assistance › Medical and Diagnostic Laboratories › Medical Laboratories

Product/Service Code: MEDICAL SERVICES › LABORATORY TESTING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bode Cellmark Forensics Inc.

Address: 231 MAPLE AVE, BURLINGTON, NC, 27215

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

Financial Breakdown

Contract Ceiling: $2,269,450

Exercised Options: $2,269,450

Current Obligation: $2,269,450

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36C24225A0041

IDV Type: BPA

Timeline