VA awards $63.9M for kidney dialysis centers, with FRESENIUS MEDICAL CARE HOLDINGS INC as the primary contractor

Contract Overview

Contract Amount: $63,907,477 ($63.9M)

Contractor: Fresenius Medical Care Holdings Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2019-01-01

End Date: 2019-04-01

Contract Duration: 90 days

Daily Burn Rate: $710.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS REPORT: 1/1/19 TO 3/31/19 FY19 Q2

Place of Performance

Location: WALTHAM, MIDDLESEX County, MASSACHUSETTS, 02451

State: Massachusetts Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $63.9 million to FRESENIUS MEDICAL CARE HOLDINGS INC for work described as: EXPRESS REPORT: 1/1/19 TO 3/31/19 FY19 Q2 Key points: 1. The contract was awarded under a firm-fixed-price structure, indicating predictable costs for the government. 2. This delivery order represents a portion of a larger indefinite-delivery indefinite-quantity (IDIQ) contract, suggesting ongoing needs. 3. The contract duration of 90 days points to a short-term requirement or a specific phase of a larger project. 4. The award was made through full and open competition, implying a robust bidding process. 5. The primary contractor, FRESENIUS MEDICAL CARE HOLDINGS INC, is a significant player in the healthcare services sector. 6. The North American Industry Classification System (NAICS) code 621492 identifies the specific service as kidney dialysis centers.

Value Assessment

Rating: good

The contract value of $63.9 million for a 90-day period for kidney dialysis centers appears to be within a reasonable range for specialized medical services. Benchmarking against similar contracts would require access to a broader dataset of VA and other federal agency procurements for dialysis services. However, the firm-fixed-price nature of the award suggests that the government has locked in costs, which is a positive indicator for value. The awarded amount is also below the ceiling of $71,008,300 mentioned in the data, indicating potential for cost savings or that this is one of multiple orders under a larger contract.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting that multiple vendors were invited to bid. This process typically leads to a more competitive pricing environment as contractors vie for the award. The specific number of bidders is not provided, but the designation 'full and open' implies a broad solicitation. This method is generally preferred for ensuring fair market prices and maximizing the pool of potential suppliers.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it is designed to foster a competitive environment, which can drive down prices and ensure the government receives the best value for its investment in essential healthcare services like kidney dialysis.

Public Impact

Veterans requiring kidney dialysis services are the primary beneficiaries of this contract. The contract ensures the continued provision of essential medical services for patients with end-stage renal disease. The services are likely delivered at or near VA medical facilities, impacting veterans within the geographic scope of those facilities. This contract supports the healthcare workforce, including medical professionals and support staff at dialysis centers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on a single large contractor if this is part of a larger IDIQ.
The short duration of the delivery order might indicate a need for more stable, long-term contracting solutions for dialysis services.
Lack of specific performance metrics in the provided data makes it difficult to assess the quality of services delivered.

Positive Signals

The use of full and open competition suggests a commitment to leveraging market forces for better pricing and service.
The firm-fixed-price contract type provides cost certainty for the government.
The contract is awarded to a known entity in the healthcare sector, potentially indicating a level of established capability.

Sector Analysis

The healthcare services sector, specifically focusing on outpatient care centers (NAICS 621492), is characterized by specialized medical treatments. Kidney dialysis is a critical, ongoing service for individuals with kidney failure. Federal spending in this area is substantial, driven by the needs of specific populations like veterans. Competition can vary depending on the geographic location and the number of specialized providers available. This contract fits within the broader federal strategy to provide comprehensive healthcare to its beneficiaries.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Given the specialized nature of kidney dialysis services and the large contract value, it is likely that larger, established healthcare providers, such as FRESENIUS MEDICAL CARE HOLDINGS INC, are the primary participants. There is no information on subcontracting plans, but typically, large healthcare contracts may involve smaller specialized service providers, though this is not guaranteed.

Oversight & Accountability

The Department of Veterans Affairs (VA) is responsible for the oversight of this contract. As a delivery order under a larger contract, oversight would likely involve contract officers, program managers, and potentially quality assurance specialists to ensure services meet the required standards. The VA has its own Inspector General's office to investigate fraud, waste, and abuse, which would have jurisdiction if any issues arise. Transparency is generally maintained through contract databases like FPDS, where basic award information is publicly available.

Related Government Programs

VA Medical Care Programs
Outpatient Services Contracts
End-Stage Renal Disease (ESRD) Treatment Programs
Federal Healthcare Procurement

Risk Flags

Contract Duration
Potential for Sole-Source if part of larger IDIQ
Limited Performance Data

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $63.9 million to FRESENIUS MEDICAL CARE HOLDINGS INC. EXPRESS REPORT: 1/1/19 TO 3/31/19 FY19 Q2

Who is the contractor on this award?

The obligated recipient is FRESENIUS MEDICAL CARE HOLDINGS 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 $63.9 million.

What is the period of performance?

Start: 2019-01-01. End: 2019-04-01.

What is the historical spending pattern for kidney dialysis centers by the Department of Veterans Affairs?

Analyzing historical spending for kidney dialysis centers by the VA requires accessing comprehensive contract data over multiple fiscal years. While this specific award is for $63.9 million over 90 days in FY19 Q2, understanding the broader trend involves looking at total annual expenditures, the number of contracts awarded, and the primary contractors involved. Historically, the VA has consistently funded dialysis services to meet the needs of its veteran population. Spending can fluctuate based on veteran population demographics, healthcare policy changes, and the availability of contracted services versus in-house provision. A detailed analysis would involve querying databases like FPDS-NG for all contracts tagged with relevant NAICS codes (e.g., 621492) and PSC codes related to medical equipment and services over several years to identify trends in award values, contract types, and key awardees.

How does the awarded amount compare to the potential ceiling of the parent contract?

The provided data indicates an awarded amount of $63,907,476.98 for this specific delivery order, with a ceiling of $71,008,300. This means the current award represents approximately 90% of the stated ceiling for this particular order or potentially a portion of a larger IDIQ contract's overall ceiling. The fact that the award is below the ceiling suggests that there is remaining capacity within the contract's financial limits. This could be for future delivery orders under the same contract or indicate that the ceiling was set conservatively. It is important to note that the 'br' value of 710083 might represent a ceiling for a specific task order or a broader contract vehicle, and its exact relationship to the $63.9M award needs further context from the parent contract documentation.

What is FRESENIUS MEDICAL CARE HOLDINGS INC's track record with the federal government, particularly the VA?

FRESENIUS MEDICAL CARE HOLDINGS INC is a major provider of dialysis products and services, and its track record with the federal government, including the VA, is extensive. Publicly available contract databases show numerous awards to Fresenius entities across various agencies, primarily for healthcare services and equipment. For the VA specifically, Fresenius has been a consistent recipient of contracts related to kidney dialysis and related medical supplies. Analyzing their performance history would involve reviewing past contract awards, their values, durations, and any reported issues such as contract terminations, disputes, or performance deficiencies. Generally, large, established companies like Fresenius have a significant presence and a history of fulfilling federal requirements, though specific contract performance can vary.

What are the key performance indicators (KPIs) typically used for kidney dialysis center contracts?

Key performance indicators (KPIs) for kidney dialysis center contracts typically focus on patient outcomes, service quality, operational efficiency, and compliance. Common KPIs include patient infection rates (e.g., bloodstream infection rates), adherence to treatment schedules, patient satisfaction scores, adequacy of dialysis treatment (measured by Kt/V levels), emergency room visit rates, and hospitalization rates. Operational KPIs might include staff-to-patient ratios, equipment maintenance schedules, and timely reporting of patient data. Compliance KPIs would involve adherence to all federal, state, and local regulations, as well as specific contract requirements. While not detailed in the award data, the VA would likely have established performance standards and monitoring mechanisms to ensure these KPIs are met.

What is the market size and competitive landscape for kidney dialysis services within the federal healthcare sector?

The market for kidney dialysis services within the federal healthcare sector, particularly for the Department of Veterans Affairs, is substantial due to the prevalence of chronic kidney disease among veterans. The competitive landscape includes large, national healthcare providers like Fresenius Medical Care, DaVita, and potentially other specialized regional providers. Federal agencies often utilize a mix of full and open competition, limited competition, and sole-source awards depending on the specific need, location, and availability of qualified providers. The market is characterized by high barriers to entry due to regulatory requirements, specialized equipment, and the need for skilled medical personnel. Federal spending in this area is driven by the commitment to provide comprehensive care to veterans, making it a stable but competitive market segment.

Industry Classification

NAICS: Health Care and Social Assistance › Outpatient Care Centers › Kidney Dialysis Centers

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: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fresenius Medical Care Capital City, LLC (UEI: 324661834)

Address: 920 WINTER ST, WALTHAM, MA, 02451

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

Financial Breakdown

Contract Ceiling: $63,907,477

Exercised Options: $63,907,477

Current Obligation: $63,907,477

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: VA79113D0019

IDV Type: IDC

Timeline