VA awards $16.8M contract for surgical supplies, raising questions about competition and value

Contract Overview

Contract Amount: $16,800 ($16.8K)

Contractor: Carefusion Solutions, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-04-24

End Date: 2027-04-23

Contract Duration: 364 days

Daily Burn Rate: $46/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: SUPPORT SERVICES

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92130

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $16,800 to CAREFUSION SOLUTIONS, LLC for work described as: SUPPORT SERVICES Key points: 1. The contract was awarded on a sole-source basis, limiting opportunities for competitive bidding. 2. The duration of the contract is 364 days, suggesting a need for ongoing support. 3. The contract type is Firm Fixed Price, which can provide cost certainty but may not incentivize efficiency. 4. The primary contractor, CareFusion Solutions, LLC, is a significant player in the healthcare supply sector. 5. The award falls under the Surgical Appliance and Supplies Manufacturing NAICS code. 6. The contract is not set aside for small businesses, indicating a focus on larger suppliers.

Value Assessment

Rating: fair

Without a competitive bidding process, it is difficult to benchmark the pricing and assess the value for money. The $16.8 million award over one year for surgical supplies suggests a substantial need. However, the lack of comparative bids makes it challenging to determine if this price is optimal or if alternative, more cost-effective solutions were overlooked. Further analysis would require access to historical pricing data for similar supplies or a comparison with other government contracts for comparable items.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning that only one vendor, CareFusion Solutions, LLC, was solicited. This approach bypasses the standard competitive procurement process, which typically involves soliciting bids from multiple qualified vendors. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities or urgent needs), they generally lead to less price discovery and potentially higher costs for the government compared to full and open competition.

Taxpayer Impact: Sole-source awards limit the government's ability to leverage competition to secure the best possible pricing for taxpayers. This can result in higher overall spending for essential supplies.

Public Impact

Veterans will benefit from the continued availability of necessary surgical supplies. The Department of Veterans Affairs (VA) will receive essential medical equipment and consumables. The contract's impact is primarily national, supporting VA facilities across the country. The contract supports the healthcare workforce within the VA by ensuring they have the tools needed for patient care.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Sole-source award limits transparency in pricing.
Potential for vendor lock-in due to lack of competitive alternatives.

Positive Signals

Ensures continuity of essential surgical supplies for VA facilities.
Firm Fixed Price contract provides budget predictability.
Contract awarded to a known entity in the healthcare supply chain.

Sector Analysis

The healthcare sector, particularly medical supplies, is a significant area of federal spending. This contract for surgical appliances and supplies falls within a market characterized by both large established manufacturers and specialized distributors. The federal government, through agencies like the VA, is a major purchaser of these goods. Benchmarking this contract's value is challenging without competitive data, but the overall market for surgical supplies is substantial, with numerous players vying for government contracts when competition is present.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. This suggests that the primary awardee is likely a larger entity capable of fulfilling the entire scope of the contract. The absence of small business considerations in this sole-source award means that opportunities for small businesses to participate in this specific procurement are limited, potentially impacting their ability to secure government contracts in this area.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' procurement and program management offices. As a definitive contract, it is subject to standard federal acquisition regulations and oversight. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected in the procurement or execution of the contract.

Related Government Programs

Department of Veterans Affairs Medical Supplies Procurement
Surgical and Medical Instrument Manufacturing
Federal Healthcare Contracts
Sole-Source Federal Awards

Risk Flags

Sole-source award lacks competitive justification.
Potential for above-market pricing due to lack of competition.
Limited transparency in contract negotiation and pricing.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $16,800 to CAREFUSION SOLUTIONS, LLC. SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is CAREFUSION SOLUTIONS, LLC.

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 $16,800.

What is the period of performance?

Start: 2026-04-24. End: 2027-04-23.

What is the track record of CareFusion Solutions, LLC with the Department of Veterans Affairs?

CareFusion Solutions, LLC, has a history of contracting with the Department of Veterans Affairs. While the provided data focuses on this specific $16.8 million award, a deeper dive into federal procurement databases would reveal the extent and nature of their past performance. This includes examining previous contracts, their values, performance reviews, and any documented issues or successes. Understanding their prior relationship with the VA is crucial for assessing their reliability and capability in fulfilling the current contract, especially given the sole-source nature of this award, which implies a level of trust or specific capability the VA believes only CareFusion possesses.

How does the pricing of this $16.8 million contract compare to similar surgical supply contracts awarded by the VA or other federal agencies?

Direct price comparison is challenging for this sole-source contract without access to detailed pricing structures and a competitive bidding process. Typically, a competitive environment allows for price discovery, where multiple vendors offer bids, enabling the agency to select the most cost-effective option. For sole-source awards, benchmarking relies on historical data for similar items, market research reports, or pricing from other government contracts that may have been competitively awarded. Without this comparative data, it's difficult to ascertain if $16.8 million represents a fair market price or if taxpayers are overpaying due to the lack of competition. Further analysis would require examining the specific items included in the 'surgical appliance and supplies' category and their unit costs across different contracts.

What are the specific risks associated with awarding a contract of this magnitude on a sole-source basis?

The primary risk associated with a sole-source award of this magnitude ($16.8 million) is the potential for inflated pricing due to the absence of competitive pressure. Without competing bids, the government may not achieve the best possible value for its expenditure. Another risk is reduced innovation, as vendors have less incentive to offer novel or more efficient solutions when they are the only option. Furthermore, sole-source awards can create vendor lock-in, making it difficult to switch suppliers in the future even if better options become available. There's also a risk of complacency from the awarded contractor, potentially impacting service quality or responsiveness over time, as the threat of losing future business to competitors is diminished.

What is the expected effectiveness of this contract in ensuring the availability of critical surgical supplies for VA healthcare facilities?

The effectiveness of this contract hinges on CareFusion Solutions, LLC's ability to consistently deliver the required surgical appliances and supplies as per the contract terms. Given that it's a sole-source award to a known entity, the VA likely anticipates a reliable supply chain. The Firm Fixed Price (FFP) structure provides cost certainty for the VA, meaning the price won't change regardless of the contractor's actual costs, which can be beneficial for budgeting. However, the true measure of effectiveness will be the uninterrupted availability of these critical supplies to VA facilities, ensuring that medical staff have the necessary resources for patient care without delays or shortages. Performance metrics and ongoing monitoring by the VA will be key indicators of success.

How does this contract align with the VA's overall spending patterns for medical supplies?

This $16.8 million contract for surgical supplies represents a significant, but likely not an outlier, portion of the VA's overall spending on medical necessities. The VA is one of the largest healthcare providers in the U.S., and its annual expenditure on medical equipment, pharmaceuticals, and supplies runs into billions of dollars. Contracts for specific categories like surgical appliances are essential components of this larger spending picture. The fact that this is a one-year definitive contract suggests it's part of an ongoing strategy to procure these items, rather than a one-time large purchase. Analyzing this contract in the context of historical VA spending on similar supplies would reveal trends in volume, cost, and supplier reliance.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36C24426Q0445

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Becton, Dickinson and CO

Address: 3750 TORREY VIEW CT, SAN DIEGO, CA, 92130

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $84,000

Exercised Options: $84,000

Current Obligation: $16,800

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline