VA's hearing aid contract saw $19.9M in November 2024 spending, with Sonova USA Inc. as the primary awardee

Contract Overview

Contract Amount: $19,987,215 ($20.0M)

Contractor: Sonova USA Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-11-01

End Date: 2024-11-30

Contract Duration: 29 days

Daily Burn Rate: $689.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS REPORT: NOVEMBER 2024 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT.

Place of Performance

Location: WARRENVILLE, DUPAGE County, ILLINOIS, 60555

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $20.0 million to SONOVA USA INC for work described as: EXPRESS REPORT: NOVEMBER 2024 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT. Key points: 1. Value for money appears fair given the firm fixed-price contract type, though detailed cost breakdowns are not provided. 2. Competition dynamics indicate a full and open competition, suggesting a healthy market for these medical devices. 3. Risk indicators are low due to the firm fixed-price nature and established contractor, but performance monitoring is key. 4. Performance context is limited to a single month's spending, making long-term trend analysis impossible. 5. Sector positioning places this contract within the broader electromedical apparatus manufacturing industry, serving a critical healthcare need. 6. The contract is a delivery order under a larger IDIQ, indicating ongoing needs for hearing aid apparatus.

Value Assessment

Rating: fair

The November 2024 spending of $19.9 million for hearing aid apparatus represents a significant monthly outlay. Benchmarking this against similar contracts is challenging without more granular data on the specific devices procured and their quantities. However, the firm fixed-price contract type suggests that pricing was determined upfront, which can offer some assurance of value if the awarded prices were competitive. Further analysis would require comparing unit costs to market rates for comparable electromedical devices.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The specific number of bidders is not detailed in this report, but the designation suggests a robust competitive environment. A full and open competition generally leads to better price discovery and potentially lower costs for the government as contractors vie for the award.

Taxpayer Impact: A full and open competition benefits taxpayers by fostering a marketplace where providers must offer competitive pricing to secure contracts, potentially leading to cost savings for the government.

Public Impact

Veterans requiring hearing assistance are the primary beneficiaries of this contract. The contract facilitates the procurement of electromedical apparatus, specifically hearing aids and related equipment. The geographic impact is national, as the Department of Veterans Affairs serves veterans across the United States. Workforce implications include support for manufacturing, distribution, and potentially audiology services related to the devices.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics for November 2024.
Limited visibility into the specific types and quantities of hearing aid apparatus procured.
Potential for price fluctuations in future delivery orders if market conditions change significantly.

Positive Signals

Award to a single, established contractor (Sonova USA Inc.) suggests reliability.
Firm fixed-price contract type provides cost certainty for this delivery order.
Full and open competition indicates a healthy and accessible market.

Sector Analysis

This contract falls within the electromedical and electrotherapeutic apparatus manufacturing sector, a critical component of the healthcare industry. This sector is characterized by innovation, stringent regulatory requirements, and significant government procurement, particularly for healthcare providers like the VA. Spending in this area is driven by the need to provide advanced medical devices to patient populations, with the VA being a major purchaser of such equipment to serve its veteran constituency.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Furthermore, there is no information regarding subcontracting plans or performance related to small businesses. Analysis of small business participation would require further investigation into the contract's overall structure and the awardee's subcontracting practices.

Oversight & Accountability

Oversight for this contract is managed by the Department of Veterans Affairs. As a delivery order under a larger contract, it is subject to the VA's internal procurement regulations and oversight mechanisms. Transparency is facilitated through contract award databases, though detailed spending breakdowns and performance reports may be internal. The Inspector General's office within the VA would have jurisdiction over any potential fraud, waste, or abuse related to this spending.

Related Government Programs

VA Medical Equipment Procurement
Hearing Health Services
Electromedical Apparatus Manufacturing
Federal Healthcare Contracts

Risk Flags

Spending concentration: High monthly spend concentrated with one vendor.
Limited performance data: November 2024 is a single data point.
Lack of detailed breakdown: Specific items and quantities not itemized.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $20.0 million to SONOVA USA INC. EXPRESS REPORT: NOVEMBER 2024 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT.

Who is the contractor on this award?

The obligated recipient is SONOVA USA 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 $20.0 million.

What is the period of performance?

Start: 2024-11-01. End: 2024-11-30.

What is the historical spending trend for this specific hearing aid contract over the past three years?

Detailed historical spending data for this specific delivery order or the parent IDIQ contract over the past three years is not available in the provided express report. The report focuses solely on November 2024 spending. To ascertain historical trends, one would need to access comprehensive contract databases (e.g., FPDS-NG, SAM.gov) and query for all delivery orders issued under the relevant IDIQ contract, aggregating spending by fiscal year or calendar year. This would reveal patterns of demand, potential seasonality, and the overall growth or decline in VA spending on hearing aid apparatus.

How does the November 2024 spending compare to the average monthly spending for this contract over its lifetime?

Comparing the November 2024 spending of $19.9 million to the average monthly spending requires knowing the total spending and duration of the contract. Since only November 2024 data is provided, we cannot calculate an average. If this were a new contract or a single delivery order, the November figure would be the only data point. If it's part of a larger IDIQ, we would need the total value of all prior delivery orders and the time elapsed since the contract's inception to compute a meaningful average. Without this context, the $19.9 million figure stands in isolation.

What specific types and quantities of hearing aid apparatus were procured with the $19.9 million in November 2024?

The provided express report does not specify the exact types and quantities of hearing aid apparatus procured during November 2024. It only states the total dollar amount spent ($19,987,215.17) and the North American Industry Classification System (NAICS) code (334510 - Electromedical and Electrotherapeutic Apparatus Manufacturing). To determine the specifics, one would need to consult the detailed contract line item (CLIN) data or the individual delivery order documentation associated with this award. This level of detail is typically found in more comprehensive contract files rather than summary reports.

What is Sonova USA Inc.'s track record with the VA for similar medical equipment contracts?

Sonova USA Inc. is a known entity in the hearing aid market. While this report confirms their award for VA hearing aid apparatus in November 2024, their broader track record with the VA for similar medical equipment would require a separate, in-depth analysis. This would involve searching federal procurement databases for past awards, contract performance evaluations (e.g., CPARS), and any history of disputes or issues. A positive track record with the VA suggests reliability and successful past performance, which are key factors in contract awards.

Are there any performance concerns or quality issues reported for Sonova USA Inc. on previous VA contracts?

The provided express report does not contain information regarding performance concerns or quality issues related to Sonova USA Inc. on previous VA contracts. Such information is typically found in Contract Performance Assessment Reporting System (CPARS) records or through Inspector General reports. A thorough review of CPARS data for Sonova USA Inc. would be necessary to assess their historical performance quality and identify any red flags or commendations from the VA on prior engagements.

What is the estimated total value of the parent IDIQ contract under which this delivery order was issued?

The provided express report focuses on a specific delivery order's spending for November 2024 and does not disclose the total value or details of the parent Indefinite Delivery/Indefinite Quantity (IDIQ) contract. To determine the total value of the parent IDIQ, one would need to access contract award data for the overarching contract vehicle. This information is usually available in federal procurement databases like SAM.gov or FPDS-NG, where the ceiling value, period of performance, and total obligated amounts for IDIQ contracts are typically documented.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Electromedical and Electrotherapeutic Apparatus Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

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: 4520 WEAVER PKWY, WARRENVILLE, IL, 60555

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

Financial Breakdown

Contract Ceiling: $19,987,215

Exercised Options: $19,987,215

Current Obligation: $19,987,215

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C79119D0036

IDV Type: IDC

Timeline