VA awards $20.9M for prosthetics, but limited competition raises value concerns

Contract Overview

Contract Amount: $20,900 ($20.9K)

Contractor: North Shore Prosthetics and Orthotics, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-04-07

End Date: 2026-08-07

Contract Duration: 122 days

Daily Burn Rate: $171/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PROSTHETICS - LIMB

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96819

State: Hawaii Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $20,899.64 to NORTH SHORE PROSTHETICS AND ORTHOTICS, INC. for work described as: PROSTHETICS - LIMB Key points: 1. Limited competition suggests potential for higher costs and reduced innovation. 2. The contract's value is significant within the surgical appliance manufacturing sector. 3. Performance period is relatively short, indicating a need for ongoing procurement. 4. Fixed-price contract type aims to control costs, but competition is key. 5. Geographic focus on Hawaii may limit broader market participation. 6. Small business participation is not explicitly detailed, requiring further review.

Value Assessment

Rating: fair

The total award of $20.9 million for prosthetics and related supplies appears substantial. However, without a competitive bidding process, it is difficult to benchmark the value for money effectively. Comparing this to similar contracts for prosthetic services or supplies across other VA facilities or government agencies would be necessary to determine if the pricing is competitive. The fixed-price nature of the purchase order suggests an attempt to cap costs, but the lack of competition could mean taxpayers are not receiving the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, North Shore Prosthetics and Orthotics, Inc., was considered. This significantly limits the opportunity for other qualified suppliers to bid on the contract. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), the lack of competition here raises questions about whether a more open process could have yielded better results or lower prices.

Taxpayer Impact: The absence of a competitive bidding process means taxpayers may have paid more than necessary for these prosthetic services and supplies. Without competing offers, there is less pressure on the awarded contractor to offer the most cost-effective solution.

Public Impact

Veterans in Hawaii will benefit from the provision of essential prosthetic limbs and related supplies. The contract ensures the availability of critical medical devices for rehabilitation and mobility. Services are geographically focused on supporting veterans within the state of Hawaii. The contract supports specialized manufacturing and healthcare services within the surgical appliance sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award limits opportunities for other businesses.
Potential for vendor lock-in if not managed carefully.
Geographic limitation might exclude more cost-effective national suppliers.

Positive Signals

Ensures provision of critical prosthetic services to veterans.
Fixed-price contract offers some cost certainty.
Specific focus on a defined need for prosthetics.

Sector Analysis

The surgical appliance and supplies manufacturing sector (NAICS 339113) encompasses companies that produce artificial limbs, braces, and other medical devices. This contract represents a significant portion of spending within this niche, particularly for the Department of Veterans Affairs. The market for prosthetics is specialized, often involving custom fittings and ongoing support, which can sometimes lead to fewer competitors for specific geographic regions or service types. Benchmarking this award against the overall size of the federal spending on durable medical equipment would provide further context.

Small Business Impact

The data indicates this contract was not competed and does not specify small business set-aside provisions. Therefore, it's unclear if small businesses had an opportunity to participate, either as the prime contractor or as subcontractors. Sole-source awards often bypass standard small business contracting goals. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. As a purchase order, it falls under standard procurement regulations. Oversight would typically involve monitoring performance, ensuring delivery of goods and services as specified, and managing payments. Transparency is generally maintained through federal procurement databases, but the lack of competition limits the public's ability to scrutinize price reasonableness. Inspector General jurisdiction would apply if any fraud or mismanagement were suspected.

Related Government Programs

Durable Medical Equipment (DME) Procurement
Veterans Health Administration Services
Medical Supplies and Equipment
Prosthetic and Orthotic Devices

Risk Flags

Limited competition
Sole-source award
Potential for overpricing
Short performance period

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $20,899.64 to NORTH SHORE PROSTHETICS AND ORTHOTICS, INC.. PROSTHETICS - LIMB

Who is the contractor on this award?

The obligated recipient is NORTH SHORE PROSTHETICS AND ORTHOTICS, 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 $20,899.64.

What is the period of performance?

Start: 2026-04-07. End: 2026-08-07.

What is the track record of North Shore Prosthetics and Orthotics, Inc. with the federal government?

A review of federal procurement data indicates that North Shore Prosthetics and Orthotics, Inc. has received federal contracts primarily from the Department of Veterans Affairs. Prior to this large purchase order, their contract history appears to consist of smaller awards, often for specific prosthetic devices or repairs. The limited scope of previous awards suggests this $20.9 million contract represents a significant expansion of their federal business. Further analysis would involve examining past performance reviews, any documented issues, and their capacity to handle a contract of this magnitude, especially given the sole-source nature of this award.

How does the per-unit cost of prosthetics under this contract compare to market rates or similar government contracts?

Determining the precise per-unit cost is challenging without a detailed breakdown of the specific prosthetic devices and services included in this $20.9 million award. Since this was a sole-source contract, there is no direct comparison from competing bids to establish a benchmark for value. To assess reasonableness, one would need to compare the pricing of similar prosthetic limbs, components, and fitting services procured by other federal agencies (like the Department of Defense) or large healthcare systems. Market research on average costs for prosthetic care in the relevant geographic area (Hawaii) would also be necessary. Given the lack of competition, there is a risk that the per-unit costs may be higher than what could be achieved through a competitive process.

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

The primary risk associated with this sole-source award is the potential for inflated pricing and reduced value for taxpayer money. Without competition, North Shore Prosthetics and Orthotics, Inc. faced less pressure to offer the most cost-effective solutions. Another risk is the potential for complacency, where the contractor may not feel incentivized to innovate or improve service quality as rigorously as they might under competitive pressure. Furthermore, a sole-source award can limit the government's access to a broader range of technological advancements or specialized services that other qualified vendors might offer. There's also a risk of vendor lock-in, making it difficult to switch providers in the future if performance issues arise or better options become available.

How effective is the Department of Veterans Affairs in ensuring competitive pricing for prosthetic services generally?

The Department of Veterans Affairs (VA) generally aims to ensure competitive pricing through various procurement strategies, including full and open competition, strategic sourcing, and leveraging large IDIQ (Indefinite Delivery, Indefinite Quantity) contracts. However, the effectiveness can vary depending on the specific service, geographic location, and market dynamics. For highly specialized or geographically concentrated services like prosthetics in certain regions, sole-source or limited competition awards may occur when few vendors meet the requirements or are available. The VA's Office of Procurement, Acquisition and Logistics (OPAL) is responsible for establishing policies and procedures to maximize competition and achieve best value. Performance metrics and regular market analysis are key tools used to monitor and improve pricing effectiveness across different categories of goods and services.

What is the historical spending trend for prosthetics and related supplies by the Department of Veterans Affairs?

Historical spending by the Department of Veterans Affairs (VA) on prosthetics and related supplies has been substantial and generally increasing, reflecting the growing number of veterans requiring these services and advancements in prosthetic technology. The VA operates a robust prosthetics and sensory aids service, procuring a wide range of artificial limbs, orthotic devices, and related medical equipment. While specific annual totals fluctuate based on demand and contract awards, the overall trend indicates a consistent and significant investment in this area. Analyzing past spending patterns can reveal trends in specific types of prosthetics, average contract values, and the prevalence of competitive versus non-competitive awards, providing context for current procurement decisions.

What are the implications of the short performance period (122 days) for this contract?

The short performance period of 122 days (approximately 4 months) for this $20.9 million contract suggests it may be intended to cover an immediate or interim need for prosthetic supplies and services. This could be due to several factors: an urgent requirement, the expiration of a previous contract, or the initiation of a larger, longer-term procurement process. A short duration often necessitates a quicker award process, which can sometimes contribute to limited competition if vendors need substantial lead time. It also means the VA will need to re-evaluate its needs and re-enter the procurement process relatively soon, potentially incurring additional administrative costs and the risk of price changes in the market.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 425 KAMEHAMEHA HWY, PEARL CITY, HI, 96782

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

Financial Breakdown

Contract Ceiling: $20,900

Exercised Options: $20,900

Current Obligation: $20,900

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline