VA awards $7.6M contract to Armcorp Construction for primary care reconfiguration to PACT model in Ohio

Contract Overview

Contract Amount: $7,633,073 ($7.6M)

Contractor: Armcorp Construction Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-01-08

End Date: 2026-05-02

Contract Duration: 845 days

Daily Burn Rate: $9.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: ROJECT NO. 539-19-101 - RECONFIGURE PRIMARY CARE TO PACT MODEL.

Place of Performance

Location: CINCINNATI, HAMILTON County, OHIO, 45220

State: Ohio Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $7.6 million to ARMCORP CONSTRUCTION INC for work described as: ROJECT NO. 539-19-101 - RECONFIGURE PRIMARY CARE TO PACT MODEL. Key points: 1. Contract aims to modernize primary care delivery by aligning with the PACT Act model. 2. Construction services are essential for facility upgrades to support new care models. 3. The contract duration of 845 days suggests a significant scope of work. 4. Fixed-price contract type helps manage cost certainty for the government. 5. Geographic focus on Ohio indicates a specific regional implementation of the PACT model. 6. The award to Armcorp Construction Inc. warrants a review of their past performance in similar projects.

Value Assessment

Rating: good

The contract value of $7.6 million for reconfiguring primary care facilities appears reasonable given the scope of construction and modernization required to implement the PACT model. While direct comparisons are difficult without specific project details, construction projects of this nature, involving facility upgrades and system integration, often fall within this general cost range. The firm fixed-price nature of the contract provides cost control, but the final value will depend on the execution and any potential change orders. Benchmarking against similar VA facility renovation projects would provide a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which suggests that while full and open competition was intended, certain sources may have been excluded for specific reasons, or the competition was limited to a pre-qualified list. The presence of only two bidders (as indicated by 'no': 2) suggests a less robust competitive landscape than ideal for a project of this magnitude. This limited competition could potentially impact price discovery and may warrant further investigation into the exclusion criteria or the availability of qualified contractors.

Taxpayer Impact: A limited number of bidders may lead to higher prices for taxpayers compared to a scenario with broader competition. It is crucial to ensure that the exclusion of sources was justified and did not unduly restrict competition.

Public Impact

Veterans in Ohio will benefit from improved primary care services through the PACT model. The project will involve construction and renovation of healthcare facilities. The geographic impact is concentrated in Ohio, serving the veteran population in that state. The construction work will likely create temporary employment opportunities for skilled trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) raises concerns about potential price inflation and reduced contractor innovation.
The 'exclusion of sources' clause needs clarification to ensure it was justified and did not unfairly limit competition.
The scope of 'reconfigure primary care to PACT model' is broad and could lead to cost overruns if not precisely managed.

Positive Signals

The contract is a firm fixed-price type, which helps in controlling costs.
The project directly supports the implementation of the PACT Act, a significant veteran healthcare initiative.
The contract duration is clearly defined, allowing for structured project management.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically related to healthcare facilities. The construction market for healthcare infrastructure is substantial, driven by the need for modernization, expansion, and adaptation to new healthcare models like the PACT Act. Spending in this area is influenced by government healthcare initiatives, demographic shifts, and technological advancements in medical care. Comparable spending benchmarks would involve analyzing other VA construction projects or large-scale healthcare facility renovations.

Small Business Impact

The contract data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific award. There is no explicit mention of small business subcontracting goals. This suggests that the prime contractor, Armcorp Construction Inc., is likely a larger entity, and the focus was on securing the necessary construction expertise. The impact on the small business ecosystem would be minimal unless specific subcontracting opportunities arise that are not detailed in this award notice.

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 the firm fixed-price contract terms, performance milestones, and quality control standards. Transparency can be assessed through publicly available contract award data and performance reports. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected during the contract's lifecycle.

Related Government Programs

PACT Act Implementation
VA Healthcare Infrastructure Modernization
Medical Facility Construction
Veterans Health Administration Programs

Risk Flags

Limited Competition
Potential for Cost Overruns
Disruption to Services
Contractor Performance Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $7.6 million to ARMCORP CONSTRUCTION INC. ROJECT NO. 539-19-101 - RECONFIGURE PRIMARY CARE TO PACT MODEL.

Who is the contractor on this award?

The obligated recipient is ARMCORP CONSTRUCTION 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 $7.6 million.

What is the period of performance?

Start: 2024-01-08. End: 2026-05-02.

What is Armcorp Construction Inc.'s track record with the Department of Veterans Affairs and similar healthcare construction projects?

A review of Armcorp Construction Inc.'s past performance with the VA and in similar healthcare construction projects is crucial. This would involve examining their history of on-time and on-budget project completion, quality of work, safety records, and any past disputes or contract modifications. Understanding their experience with government contracts, particularly those involving facility reconfiguration or modernization for healthcare delivery, will provide insight into their capability to successfully execute this PACT model project. Specific data on previous VA contracts, including their value, scope, and performance ratings, would be essential for a comprehensive assessment.

How does the awarded price of $7.6 million compare to similar VA primary care facility reconfiguration projects?

Benchmarking the $7.6 million award against similar VA primary care facility reconfiguration projects is key to assessing value for money. This comparison should consider the square footage involved, the complexity of the renovations (e.g., integration of new medical technologies, structural changes), the duration of the project, and the geographic location, as construction costs vary regionally. Analyzing the cost per square foot or cost per bed for similar projects awarded over the past few years would provide a quantitative basis for comparison. If this contract's cost per unit is significantly higher than comparable projects without a clear justification (e.g., unique site challenges, advanced technological integration), it could indicate potential overpricing or inefficiencies.

What are the specific risks associated with reconfiguring primary care facilities to the PACT model, and how are they mitigated?

Key risks in reconfiguring primary care facilities to the PACT model include potential disruptions to ongoing patient care during construction, scope creep leading to cost overruns, delays in material procurement or labor availability, and challenges in integrating new IT systems or workflows. Mitigation strategies should include phased construction schedules to minimize patient disruption, robust project management with clear change control processes, contingency planning for supply chain issues, and close collaboration between construction teams, clinical staff, and IT departments. The firm fixed-price contract helps mitigate cost risks, but effective oversight and proactive risk management are still paramount.

How effective is the PACT model in improving veteran healthcare outcomes, and what is the expected impact of this reconfiguration?

The PACT (P ACT) model aims to provide comprehensive healthcare services to eligible veterans, including expanded eligibility for toxic-exposed veterans, enhanced primary care, and mental health services. Its effectiveness is measured by improvements in access to care, patient satisfaction, health outcomes, and the ability to manage complex health needs. This reconfiguration project is expected to enhance the physical infrastructure to better support the PACT model's goals, potentially leading to more efficient service delivery, improved patient experience, and better health outcomes for veterans in the targeted Ohio region. Ongoing monitoring and evaluation of veteran health metrics post-reconfiguration will be crucial to assess the model's success.

What has been the historical spending trend for VA facility construction and renovation projects over the last five years?

Analyzing historical spending trends for VA facility construction and renovation projects over the last five years would reveal patterns in investment and identify any significant increases or decreases in budget allocation. This trend analysis can help contextualize the current $7.6 million award within the broader VA capital infrastructure investment strategy. Understanding whether spending has been consistently rising, stable, or declining can inform assessments of current contract values and future budget needs. It also helps identify if specific types of projects, like primary care modernizations, have seen increased funding emphasis.

Given the 'limited' competition, what steps are being taken to ensure fair pricing and prevent contractor collusion?

When competition is limited, especially under 'full and open competition after exclusion of sources,' ensuring fair pricing and preventing collusion requires heightened vigilance. The VA should have robust cost analysis procedures in place, potentially involving independent cost estimates and detailed review of the contractor's proposed costs. Price negotiation strategies should be employed to challenge any perceived excessive pricing. Furthermore, monitoring contract performance for any signs of unusual collaboration between bidders or deviations from the proposed scope could help detect potential collusion. Transparency in the award process, where permissible, and clear justification for any source exclusions are also important deterrents.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 36C25023B0065

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8511 STATE ROUTE 703, CELINA, OH, 45822

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $7,633,073

Exercised Options: $7,633,073

Current Obligation: $7,633,073

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline