VA awards $401M contract for physician services to Health Net Federal Services, LLC
Contract Overview
Contract Amount: $401,444,842 ($401.4M)
Contractor: Health NET Federal Services, LLC
Awarding Agency: Department of Veterans Affairs
Start Date: 2018-01-01
End Date: 2018-09-30
Contract Duration: 272 days
Daily Burn Rate: $1.5M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Healthcare
Official Description: EXPRESS REPORT: PCCC/CHOICE
Place of Performance
Location: RANCHO CORDOVA, SACRAMENTO County, CALIFORNIA, 95742
Plain-Language Summary
Department of Veterans Affairs obligated $401.4 million to HEALTH NET FEDERAL SERVICES, LLC for work described as: EXPRESS REPORT: PCCC/CHOICE Key points: 1. Contract value of $401.4M for physician services. 2. Awarded to Health Net Federal Services, LLC. 3. Procured under full and open competition. 4. Sector is Healthcare (Offices of Physicians).
Value Assessment
Rating: good
The contract value of $401.4M appears reasonable for physician services over a 9-month period, considering the scope of services typically provided by a large healthcare contractor.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process and a competitive bidding environment. This method generally leads to more favorable pricing for the government.
Taxpayer Impact: The use of full and open competition is expected to maximize value for taxpayers by ensuring the government receives competitive pricing for essential physician services.
Public Impact
Ensures continued access to physician services for veterans. Supports healthcare delivery within the Department of Veterans Affairs. Potential impact on patient care quality and wait times.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Contract duration is relatively short (9 months).
- Fixed Price Incentive contract type can lead to cost overruns if not managed carefully.
Positive Signals
- Awarded under full and open competition.
- Significant value indicates a substantial need and commitment.
Sector Analysis
This contract falls within the Healthcare sector, specifically for physician services. Spending benchmarks for physician services can vary widely based on location, specialty, and service volume, but $401M for 9 months suggests a large-scale operation.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The award to Health Net Federal Services, LLC, a large entity, suggests that small businesses may not have been primary awardees for this specific contract.
Oversight & Accountability
The Department of Veterans Affairs is responsible for oversight of this contract. The use of a Fixed Price Incentive contract type requires diligent monitoring to ensure cost control and performance standards are met.
Related Government Programs
- Offices of Physicians (except Mental Health Specialists)
- Department of Veterans Affairs Contracting
- Department of Veterans Affairs Programs
Risk Flags
- Potential for cost overruns due to FPI contract type.
- Short contract duration may lead to frequent re-competition and transition costs.
- Dependence on a single large contractor for critical services.
- Lack of explicit small business participation noted.
Tags
offices-of-physicians-except-mental-heal, department-of-veterans-affairs, ca, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Veterans Affairs awarded $401.4 million to HEALTH NET FEDERAL SERVICES, LLC. EXPRESS REPORT: PCCC/CHOICE
Who is the contractor on this award?
The obligated recipient is HEALTH NET FEDERAL SERVICES, 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 $401.4 million.
What is the period of performance?
Start: 2018-01-01. End: 2018-09-30.
What specific physician services are covered under this contract and how do they align with VA's patient needs?
The contract covers services under NAICS code 621111 (Offices of Physicians). This typically includes general and specialized medical services provided by physicians. A detailed breakdown of specific services, patient volumes, and specialties would be needed to fully assess alignment with VA's patient needs and ensure efficient resource allocation.
What are the key performance indicators (KPIs) and incentive structures within the Fixed Price Incentive contract?
The Fixed Price Incentive (FPI) contract type links contractor profit to performance against cost and schedule targets. Key KPIs would likely include patient access, quality of care metrics, and provider availability. The incentive structure would define how deviations from target costs and performance impact the final price paid, requiring careful VA oversight to manage risks and reward efficiency.
How does the $401M award compare to historical spending on similar physician services by the VA or other federal agencies?
Benchmarking this $401M award requires comparing it against similar contracts for physician services within the VA or other agencies, considering factors like contract duration, scope of services, and geographic location. Without specific comparative data, it's difficult to definitively assess if this represents optimal value, though the full and open competition suggests a competitive outcome.
Industry Classification
NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians (except Mental Health Specialists)
Product/Service Code: MEDICAL SERVICES › OTHER MEDICAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: Centene Corporation (UEI: 809245525)
Address: 2025 AEROJET RD, RANCHO CORDOVA, CA, 95742
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $401,444,842
Exercised Options: $401,444,842
Current Obligation: $401,444,842
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: VA79113D0053
IDV Type: IDC
Timeline
Start Date: 2018-01-01
Current End Date: 2018-09-30
Potential End Date: 2022-03-31 00:00:00
Last Modified: 2021-06-14
More Contracts from Health NET Federal Services, LLC
- Managed Care Support Services in Support of the Tricare Program — $23.5B (Department of Defense)
- Provide Managed Care Support to the Department of Defense Tricare Program. Contractor Shall Assist Military Health System in Operating an Integrated Healthcare Delivery System Combining Resources of the Military's Direct Medical Care System and the Contractors Managed Care Support to Provide Health, Medical and Administrative Support Services to Eligible Beneficiaries in the North Region — $19.4B (Department of Defense)
- Federal Contract — $16.5B (Department of Defense)
- FY17 4TH QTR Express Report: — $311.8M (Department of Veterans Affairs)
- Patient Centered Community Care (pccc). Modification to Exercise Option Year 2 — $265.0M (Department of Veterans Affairs)
View all Health NET Federal Services, LLC federal contracts →
Other Department of Veterans Affairs Contracts
- CCN Region 3 Express Report — $5.2B (Optum Public Sector Solutions, Inc.)
- Express Report for FY22 Region 2 — $5.1B (Optum Public Sector Solutions, Inc.)
- Fiscal Year 2022 Express Report for Region 1 — $4.2B (Optum Public Sector Solutions, Inc.)
- Express Report for the Patient Centered Community Care (PC3) Contract — $3.3B (Triwest Healthcare Alliance Corp)
- CCN Region Three FY21 Express Report — $3.1B (Optum Public Sector Solutions, Inc.)