VA awards $550K for laboratory testing services to Quest Diagnostics, highlighting a competitive procurement process

Contract Overview

Contract Amount: $550,000 ($550.0K)

Contractor: Quest Diagnostics Incorporated

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-06-01

End Date: 2027-05-31

Contract Duration: 364 days

Daily Burn Rate: $1.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: VASTLHCS OY4 TASK ORDER - REFERRAL LABORATORY TESTING SERVICES FOR VISN 15

Place of Performance

Location: SAINT LOUIS, SAINT LOUIS CITY County, MISSOURI, 63106

State: Missouri Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $550,000.02 to QUEST DIAGNOSTICS INCORPORATED for work described as: VASTLHCS OY4 TASK ORDER - REFERRAL LABORATORY TESTING SERVICES FOR VISN 15 Key points: 1. The contract value of $550,000 for a one-year period suggests a moderate scale for specialized laboratory services. 2. Quest Diagnostics, a large established provider, likely brings significant capacity and expertise to this task order. 3. The firm fixed-price contract type indicates that the government has a clear understanding of the scope and associated costs. 4. The duration of one year, with potential for extensions, allows for flexibility while managing ongoing service needs. 5. The award falls within the Medical Laboratories NAICS code, a sector with consistent federal demand for diagnostic services.

Value Assessment

Rating: good

Benchmarking the $550,000 value against similar task orders for referral laboratory testing requires access to a broader dataset of comparable contracts. However, for a one-year duration, this amount appears reasonable for specialized services. The firm fixed-price structure helps control costs, assuming the scope is well-defined. Without specific performance metrics or detailed cost breakdowns, a precise value-for-money assessment is challenging, but the competitive award suggests a fair market price was likely achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all eligible responsible sources were permitted to submit offers. The specific number of bidders is not provided, but a full and open competition generally fosters a competitive environment, encouraging multiple vendors to vie for the contract. This process is designed to ensure the government receives the best possible pricing and quality by leveraging market forces.

Taxpayer Impact: A full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at competitive prices, preventing potential overspending and ensuring efficient use of public funds.

Public Impact

Veterans in VISN 15 will benefit from access to necessary referral laboratory testing services. The contract ensures the provision of critical diagnostic services that support patient care and treatment plans. The geographic impact is focused on the Missouri region served by VISN 15. The services delivered are essential for the operational efficiency of the VA healthcare system in the specified region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased reliance on a single large provider for specialized testing, which could limit future competition if not managed proactively.
Ensuring consistent quality and turnaround times across all referred tests is crucial for patient outcomes.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm fixed-price contract type provides cost certainty for the government.
Quest Diagnostics is a well-established provider with extensive experience in laboratory services.

Sector Analysis

The Medical Laboratories (NAICS 621511) sector encompasses establishments primarily engaged in performing medical laboratory tests for the diagnosis, detection, and treatment of diseases. Federal spending in this sector is driven by healthcare providers like the Department of Veterans Affairs, as well as other agencies requiring diagnostic services. The market is characterized by a mix of large national providers and smaller regional laboratories. This contract fits within the VA's broader strategy to ensure access to essential diagnostic services for its patient population, leveraging external providers for specialized or high-volume testing needs.

Small Business Impact

This contract was awarded under full and open competition and does not indicate any specific small business set-aside. Therefore, there are no direct subcontracting implications for small businesses mandated by this award. The primary contractor, Quest Diagnostics, is a large corporation, and while they may engage small businesses in their broader supply chain, this specific contract does not appear to be structured to directly benefit the small business ecosystem through set-asides or specific subcontracting goals.

Oversight & Accountability

Oversight for this task order will likely fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract, requiring delivery of specified services. Transparency is generally maintained through contract databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

VA Laboratory Services
VISN 15 Healthcare Contracts
Medical Diagnostic Services
Federal Healthcare Procurement

Risk Flags

Potential for scope creep if not clearly defined.
Dependence on contractor performance for critical patient care decisions.
Ensuring data security and privacy of patient information.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $550,000.02 to QUEST DIAGNOSTICS INCORPORATED. VASTLHCS OY4 TASK ORDER - REFERRAL LABORATORY TESTING SERVICES FOR VISN 15

Who is the contractor on this award?

The obligated recipient is QUEST DIAGNOSTICS INCORPORATED.

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 $550,000.02.

What is the period of performance?

Start: 2026-06-01. End: 2027-05-31.

What is the historical spending pattern of the VA for referral laboratory testing services, particularly within VISN 15?

Analyzing historical spending for referral laboratory testing services within VISN 15 requires access to detailed VA procurement data over multiple fiscal years. Generally, federal agencies like the VA utilize such contracts to supplement internal laboratory capabilities or to access specialized testing not available in-house. Spending patterns can fluctuate based on patient volume, changes in medical technology, and the availability of in-house resources. A consistent trend of outsourcing referral testing suggests a strategic decision to leverage external expertise and capacity, potentially for cost-efficiency or to ensure timely results for a wide range of diagnostic needs across the VISN's facilities. Without specific historical data for VISN 15, it's difficult to pinpoint exact trends, but the ongoing need for such services indicates a sustained requirement.

How does the pricing of this contract compare to other similar referral laboratory testing contracts awarded by the VA or other federal agencies?

A direct comparison of pricing for this $550,000 task order requires access to a benchmark database of similar contracts, including details on the scope of services, volume, and specific tests performed. As a firm fixed-price contract, the price is set regardless of the actual cost incurred by the contractor. The fact that it was awarded under full and open competition suggests that the pricing is likely competitive within the market for the specified services. However, without knowing the exact service catalog and volume commitments, it's challenging to definitively state if it represents the best value. Factors such as turnaround time, geographic coverage, and the breadth of tests offered by Quest Diagnostics would influence its overall cost-effectiveness compared to alternatives.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract to ensure quality and timeliness?

While the provided data does not explicitly list Key Performance Indicators (KPIs) or Service Level Agreements (SLAs), contracts for referral laboratory testing typically include stringent requirements to ensure quality and timeliness. These often encompass metrics such as specimen rejection rates, turnaround times for specific test categories (e.g., routine vs. STAT tests), accuracy of results, and compliance with all relevant accreditation standards (e.g., CLIA). The Department of Veterans Affairs would expect Quest Diagnostics to adhere to these standards, and performance would likely be monitored through regular reporting and potentially through periodic reviews. Failure to meet critical SLAs could result in penalties or contract termination, underscoring their importance in managing this service.

What is Quest Diagnostics' track record with the VA and other federal agencies for similar laboratory services?

Quest Diagnostics is a major provider of diagnostic testing services and has a significant track record of contracting with various federal agencies, including the Department of Veterans Affairs. They routinely handle large volumes of testing for healthcare providers nationwide. Their experience typically includes managing complex logistics, ensuring regulatory compliance, and delivering a wide array of diagnostic tests. Federal procurement databases often reflect past performance information, which would be a critical factor in the VA's decision-making process for awarding this task order. Generally, established providers like Quest Diagnostics are chosen for their proven ability to meet the demanding requirements of government healthcare systems.

What is the potential impact of this contract on the VA's internal laboratory capacity and resource allocation?

This contract for referral laboratory testing services suggests that the VA's internal laboratories within VISN 15 may either lack the capacity to perform all necessary tests, do not possess the specialized equipment for certain diagnostics, or find it more cost-effective to outsource these specific services. By utilizing Quest Diagnostics, the VA can potentially reduce the strain on its internal resources, allowing its staff and equipment to focus on core or high-priority testing. This strategic outsourcing can enhance operational efficiency, improve turnaround times for certain tests, and ensure access to a broader menu of diagnostic capabilities without requiring significant capital investment in new equipment or personnel for the VA itself.

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: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 500 PLAZA DR, SECAUCUS, NJ, 07094

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

Financial Breakdown

Contract Ceiling: $550,000

Exercised Options: $550,000

Current Obligation: $550,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C25522D0028

IDV Type: IDC

Timeline