DHS awards $198M for medical screening, with 811k benchmarked as a high per-unit cost

Contract Overview

Contract Amount: $197,988,653 ($198.0M)

Contractor: Loyal Source Government Services LLC

Awarding Agency: Department of Homeland Security

Start Date: 2023-03-30

End Date: 2023-11-29

Contract Duration: 244 days

Daily Burn Rate: $811.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: MEDICAL SCREENING SERVICES

Place of Performance

Location: DONNA, HIDALGO County, TEXAS, 78537

State: Texas Government Spending

Plain-Language Summary

Department of Homeland Security obligated $198.0 million to LOYAL SOURCE GOVERNMENT SERVICES LLC for work described as: MEDICAL SCREENING SERVICES Key points: 1. The contract's value suggests a significant need for temporary medical screening personnel. 2. Competition dynamics indicate a full and open process, potentially driving better pricing. 3. The contract's duration and delivery order structure imply ongoing, adaptable service needs. 4. Performance context is limited without specific metrics on screening efficiency or accuracy. 5. The sector positioning is within essential government services, particularly border security. 6. Risk indicators include potential cost overruns if per-unit costs are not managed. 7. The contractor, Loyal Source Government Services LLC, has experience in government contracting.

Value Assessment

Rating: questionable

The total award of $197,988,653.01 for medical screening services over 244 days is substantial. Benchmarking against similar contracts is difficult without more specific service details. However, the reported benchmark of $8,114,290 per unit (assuming 'br' represents a unit cost or a significant portion thereof) appears exceptionally high for temporary staffing services, raising concerns about value for money. Further analysis is needed to understand what constitutes a 'unit' in this context and if it aligns with industry standards.

Cost Per Unit: $8,114,290 (per unit benchmark)

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The presence of a single award, however, does not reveal the number of bids received. A robust competitive process typically leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it allows for a wider range of offers, increasing the likelihood of securing services at competitive prices and encouraging market innovation.

Public Impact

Benefits U.S. Customs and Border Protection (CBP) by providing essential medical screening capabilities. Supports the delivery of temporary medical screening services, crucial for border operations. Geographic impact is primarily within Texas (ST), aligning with border security operations. Workforce implications include the provision of temporary medical personnel to support federal agencies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High per-unit cost benchmark raises concerns about overall cost-effectiveness.
Lack of specific performance metrics makes it difficult to assess service quality and efficiency.
Reliance on temporary staffing may introduce variability in service continuity and expertise.
The 'TIME AND MATERIALS' contract type can lead to cost uncertainty if not closely managed.

Positive Signals

Awarded through full and open competition, indicating a potentially competitive bidding process.
Contractor has experience in government services, suggesting familiarity with federal requirements.
The contract addresses a critical government function, ensuring operational continuity for CBP.

Sector Analysis

The Temporary Help Services sector (NAICS 561320) is a significant component of the broader professional, scientific, and technical services industry. Government agencies frequently utilize temporary staffing to manage fluctuating workloads, specialized skill requirements, or during periods of hiring freezes. The market size for government temporary staffing is substantial, driven by agencies like Homeland Security that require agile workforce solutions. This contract fits within the government's strategy to procure essential support services efficiently, though benchmarking against other large-scale temporary staffing contracts is necessary for a complete value assessment.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a small business set-aside (ss: false, sb: false). This suggests that large businesses were likely the primary bidders. There is no explicit information regarding subcontracting plans for small businesses within this award. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though opportunities may arise if the prime contractor opts to utilize small business subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the U.S. Customs and Border Protection (CBP) within the Department of Homeland Security. Accountability measures would be embedded in the contract's terms, including performance standards and reporting requirements. Transparency is facilitated through contract award databases like FPDS. The Inspector General for the Department of Homeland Security would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Department of Homeland Security Medical Services Contracts
U.S. Customs and Border Protection Staffing
Temporary Staffing Services for Federal Agencies
Medical Screening Services Contracts
Time and Materials Contracts

Risk Flags

High Per-Unit Cost Benchmark
Lack of Specific Performance Metrics
Potential for Cost Overruns (T&M Contract)

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $198.0 million to LOYAL SOURCE GOVERNMENT SERVICES LLC. MEDICAL SCREENING SERVICES

Who is the contractor on this award?

The obligated recipient is LOYAL SOURCE GOVERNMENT SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $198.0 million.

What is the period of performance?

Start: 2023-03-30. End: 2023-11-29.

What specific medical screening services are being provided under this contract, and what is the definition of a 'unit' for the $8.1 million benchmark?

The provided data indicates the contract is for 'MEDICAL SCREENING SERVICES' under NAICS code '561320' (Temporary Help Services). However, the specific nature of these services (e.g., pre-employment physicals, health screenings for detainees, COVID-19 testing, etc.) is not detailed. Similarly, the 'br' field, listed as 811429, is presented as a benchmark. Without further context, it is unclear if this represents a per-unit cost, a total cost for a specific subset of services, or another metric. If it is a per-unit cost, the definition of that unit is critical. For instance, if a 'unit' refers to a single screening event, $8.1 million per event would be astronomically high. If it represents a larger package of services or a team for a specific period, it might be more plausible, but still requires significant justification and comparison to market rates for similar temporary medical staffing engagements.

How does the $8.1 million benchmark compare to industry standards for similar medical screening services provided by temporary staffing agencies?

The $8.1 million benchmark ('br') is exceptionally high and requires significant clarification. Standard industry benchmarks for temporary medical staffing services typically focus on hourly rates for individual professionals (e.g., nurses, medical technicians) or daily/weekly rates for teams, often ranging from hundreds to a few thousand dollars per day per professional, depending on skill level and location. A benchmark of $8.1 million suggests either a misunderstanding of the data field, a vastly different definition of 'unit,' or an outlier cost. Without knowing what this benchmark represents (e.g., cost per facility, cost per large team deployment, cost over a specific period), a direct comparison to industry standards is impossible. However, if this figure is indeed a per-unit cost for a discrete service, it is orders of magnitude higher than typical market rates, indicating a potential issue with value for money or a need for deeper investigation into the scope and nature of the services.

What is the track record of Loyal Source Government Services LLC in providing similar medical screening or temporary staffing services to the federal government?

Loyal Source Government Services LLC has a history of securing federal contracts, including those related to staffing and support services. Publicly available data indicates they have been awarded numerous contracts across various agencies, suggesting experience in navigating federal procurement processes and delivering services. To assess their specific track record for medical screening, a deeper dive into past performance evaluations, contract history related to healthcare or screening services, and any reported issues or successes on similar engagements would be necessary. Their ability to successfully execute this large $198 million contract will depend on their demonstrated capacity, qualified personnel, and adherence to contractual requirements, particularly given the critical nature of medical screening at the border.

What are the potential risks associated with a 'Time and Materials' contract type for these services, and how are they mitigated?

The 'Time and Materials' (T&M) contract type, used here, carries inherent risks for the government, primarily related to cost control. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours at specified hourly rates and for the actual cost of materials. This can lead to cost uncertainty and potential overruns if the scope of work expands or if labor hours are not efficiently utilized. Mitigation strategies employed by the government typically include establishing ceiling prices, requiring detailed timesheets and justifications for hours worked, implementing robust oversight and auditing processes, and defining clear task orders. For this contract, CBP would need stringent monitoring of personnel hours and material costs to ensure the $198 million award does not significantly exceed the anticipated value, especially given the high per-unit benchmark.

How does the total spending on medical screening services by U.S. Customs and Border Protection compare to previous fiscal years?

To assess historical spending patterns for medical screening services by U.S. Customs and Border Protection (CBP), one would need to analyze contract data from previous fiscal years. This involves querying federal procurement databases (like FPDS or USASpending.gov) for contracts awarded by CBP related to medical services, health screenings, or temporary medical staffing. Comparing the total obligated amounts and the number of contracts awarded year-over-year would reveal trends. For instance, an increase in spending might indicate heightened operational needs, policy changes (like increased health protocols), or a shift towards outsourcing these services. Conversely, a decrease could suggest improved efficiency, in-house capabilities, or reduced operational tempo. Without this historical data, it's impossible to contextualize the current $198 million award within CBP's broader spending trajectory.

What performance metrics are likely being used to evaluate the success of this contract, and how are they monitored?

While specific performance metrics are not detailed in the provided data, contracts for medical screening services typically include metrics focused on timeliness, accuracy, and compliance. For CBP, this could involve the speed at which individuals are screened, the rate of identification of health concerns, adherence to health protocols (e.g., PPE usage, sanitation), and the accuracy of documentation. Monitoring likely involves regular reporting from the contractor, site visits by government personnel, and potentially data analysis of screening outcomes. Key Performance Indicators (KPIs) might include average screening time per individual, percentage of screenings completed within a target timeframe, and a low rate of reported errors or deficiencies. The effectiveness of these metrics and the rigor of their monitoring are crucial for ensuring value and mission accomplishment.

Industry Classification

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

Product/Service Code: MEDICAL SERVICES › NURSING, NURSING HOME, EVAL/SCREEN

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70B03C23Q00000101

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 12612 CHALLENGER PKWY STE 365, ORLANDO, FL, 32826

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $197,988,653

Exercised Options: $197,988,653

Current Obligation: $197,988,653

Actual Outlays: $185,520,809

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36F79722D0185

IDV Type: FSS

Timeline