VA awards $108M for pharmacy support services, with a significant portion allocated to temporary staffing

Contract Overview

Contract Amount: $107,927,607 ($107.9M)

Contractor: DLH Solutions Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-02-01

End Date: 2023-10-31

Contract Duration: 272 days

Daily Burn Rate: $396.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: BRIDGE PHARMACIST / PHARMACY TECHNICIAN FOR CMOP

Place of Performance

Location: LEAVENWORTH, LEAVENWORTH County, KANSAS, 66048

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $107.9 million to DLH SOLUTIONS INC for work described as: BRIDGE PHARMACIST / PHARMACY TECHNICIAN FOR CMOP Key points: 1. The contract's value suggests a substantial need for pharmacy personnel to support the CMOP operations. 2. A firm-fixed-price contract type indicates that the government has a clear understanding of the scope and cost. 3. The short duration of the delivery order (less than a year) points to an immediate or short-term need. 4. The award was made under full and open competition, suggesting a robust bidding process. 5. The primary service category is temporary help services, highlighting a focus on staffing rather than long-term solutions. 6. The contract was awarded to a single vendor, DLH Solutions Inc., indicating their capacity to meet the VA's requirements.

Value Assessment

Rating: good

The contract value of approximately $108 million for pharmacy support services appears substantial. Benchmarking against similar contracts for temporary pharmacy staffing can provide a clearer picture of value for money. The firm-fixed-price structure suggests that pricing was determined upfront. Without specific per-unit cost data or comparisons to market rates for pharmacist and pharmacy technician services, a definitive value assessment is challenging, but the scale of the award implies significant operational support is required.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The data does not specify the number of bids received, but the 'full and open' designation generally suggests a competitive environment. This approach is intended to foster price discovery and ensure the government receives competitive pricing by allowing multiple vendors to vie for the contract.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it increases the likelihood of obtaining services at the most competitive prices, thereby maximizing the value of federal dollars spent.

Public Impact

Veterans will benefit from the continued and efficient operation of the Consolidated Mail Outpatient Pharmacy (CMOP) services, ensuring timely access to medications. The contract directly supports the delivery of essential pharmacy technician and pharmacist services, crucial for medication dispensing and patient care. The services are likely concentrated in areas served by the CMOP facilities, primarily supporting the Department of Veterans Affairs' healthcare network. The contract will impact the workforce by creating demand for temporary pharmacy technicians and pharmacists, potentially offering employment opportunities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on temporary staff, which could impact institutional knowledge and long-term service continuity.
The significant dollar amount for temporary help services warrants scrutiny to ensure it aligns with actual needs and market rates.
The duration of the delivery order (less than a year) might indicate a reactive approach to staffing needs rather than proactive planning.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that should yield fair pricing.
The firm-fixed-price contract type provides cost certainty for the government.
The contract supports critical pharmacy operations for the VA, directly impacting veteran healthcare.

Sector Analysis

The healthcare sector, particularly within government services, relies heavily on staffing and support contracts to maintain operational efficiency. Temporary help services are common in this sector to manage fluctuating workloads, specialized skill needs, or to fill immediate vacancies. The Department of Veterans Affairs, as a major healthcare provider, frequently utilizes such contracts to ensure continuity of care. Spending in this area is benchmarked against the broader federal contracting landscape for healthcare support and temporary staffing services.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no specific subcontracting requirements for small businesses were mandated. The award to DLH Solutions Inc., a single entity, does not inherently suggest opportunities for small business subcontractors unless DLH Solutions Inc. voluntarily engages them. Further analysis would be needed to determine if small businesses are indirectly benefiting through subcontracting opportunities.

Oversight & Accountability

The Department of Veterans Affairs is responsible for the oversight of this contract. As a delivery order under a larger contract vehicle, it likely falls under existing VA procurement regulations and oversight mechanisms. Transparency is generally maintained through contract award databases like FPDS. Specific accountability measures would be detailed within the contract terms and conditions, including performance standards and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

VA Pharmacy Benefits Management
CMOP Operations Support
Temporary Healthcare Staffing Contracts
Federal Healthcare Services Contracts

Risk Flags

Potential for high turnover in temporary staffing
Ensuring consistent quality of service with temporary staff
Adequacy of oversight for temporary personnel
Market rate comparison for temporary pharmacy services

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $107.9 million to DLH SOLUTIONS INC. BRIDGE PHARMACIST / PHARMACY TECHNICIAN FOR CMOP

Who is the contractor on this award?

The obligated recipient is DLH SOLUTIONS 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 $107.9 million.

What is the period of performance?

Start: 2023-02-01. End: 2023-10-31.

What is the track record of DLH Solutions Inc. in performing similar federal contracts, particularly for the Department of Veterans Affairs?

DLH Solutions Inc. has a significant history of performing federal contracts, including those with the Department of Veterans Affairs. Their portfolio often includes IT, healthcare, and professional services. For VA contracts, they have been involved in various support roles, including healthcare staffing and administrative services. Analyzing their past performance ratings, any past performance issues, and the types of services they have successfully delivered to the VA and other agencies would provide context for their ability to fulfill this pharmacy support contract. Specific contract data would reveal the scale and duration of their previous engagements, helping to assess their capacity and experience.

How does the awarded amount of approximately $108 million compare to historical spending on similar pharmacy support services by the VA or other federal agencies?

The $108 million award for pharmacy support services, specifically for temporary help, is a substantial figure. To benchmark its value, one would compare it to previous VA contracts for CMOP staffing or similar temporary healthcare staffing needs. Analyzing the average cost per pharmacist or pharmacy technician hour/day/month across comparable contracts would be crucial. If this award represents a significant increase or decrease compared to historical averages, it could indicate changes in market rates, increased demand, or potentially a more or less competitive bidding environment. Without direct comparative data, it's difficult to definitively state if this represents excellent or questionable value.

What are the primary risks associated with a contract of this magnitude focused on temporary staffing for critical pharmacy operations?

Key risks include potential disruptions to pharmacy operations if temporary staff turnover is high or if recruitment is challenging. There's also a risk of inconsistent service quality if training and onboarding are inadequate. Over-reliance on temporary staff could lead to a lack of institutional knowledge and long-term commitment, potentially impacting efficiency and morale of permanent staff. Furthermore, ensuring compliance with all VA regulations and pharmacy standards by a transient workforce requires robust oversight. The significant dollar amount also presents a financial risk if the services procured do not yield the expected operational benefits or if costs escalate unexpectedly, despite the fixed-price nature.

How effective is the current CMOP system in serving veterans, and how does this contract contribute to its overall effectiveness?

The Consolidated Mail Outpatient Pharmacy (CMOP) system is a critical component of the VA's healthcare infrastructure, designed to provide timely and cost-effective prescription fulfillment to veterans nationwide. Its effectiveness is generally measured by prescription fill rates, delivery times, accuracy, and patient satisfaction. This contract, by providing essential pharmacist and pharmacy technician support, directly contributes to the operational capacity and efficiency of the CMOP. Adequate staffing ensures that prescriptions are processed accurately and dispatched promptly, thereby enhancing veterans' access to necessary medications and supporting their overall health management. The success of this contract is thus tied to the continued smooth functioning of the CMOP.

What are the historical spending patterns for temporary help services within the VA's healthcare sector, and does this award align with those trends?

Historical spending on temporary help services within the VA's healthcare sector has generally been significant, driven by the need to maintain staffing levels across various medical and administrative functions. Agencies often use temporary staffing to address immediate needs, manage fluctuations in demand, or cover for permanent staff absences. This $108 million award for pharmacy support appears to be a substantial investment within this category. Analyzing past VA spending on similar temporary healthcare staffing contracts would reveal if this award is an outlier or consistent with established patterns. Trends might show an increase in such spending due to workforce shortages or specific program expansions.

What is the potential impact of this contract on the broader market for pharmacy technicians and pharmacists, both within the federal government and the private sector?

A contract of this size, focused on temporary staffing, can have a notable impact on the market for pharmacists and pharmacy technicians. It signals a significant demand from a major federal agency, potentially drawing qualified professionals towards government contracts. This could influence salary expectations and availability in both the federal and private sectors. If DLH Solutions Inc. actively recruits from the existing pool of professionals, it might create competition for talent, potentially driving up wages or making it harder for other organizations to fill positions. Conversely, it could also stimulate training and recruitment efforts to meet the increased demand.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Employment Services › Temporary Help Services

Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: DLH Holdings Corp

Address: 3565 PIEDMONT RD NE, BUILDING 3, SUITE 700, ATLANTA, GA, 30305

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

Financial Breakdown

Contract Ceiling: $146,114,738

Exercised Options: $107,927,607

Current Obligation: $107,927,607

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36F79722D0187

IDV Type: FSS

Timeline