HHS/ASPR awards $59.2M contract for ventilator inventory management to Agiliti Health Inc

Contract Overview

Contract Amount: $59,226,708 ($59.2M)

Contractor: Agiliti Health Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2021-07-28

End Date: 2022-02-27

Contract Duration: 214 days

Daily Burn Rate: $276.8K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: THIS IS A CONTRACT BETWEEN THE DEPARTMENT OF HEALTH AND HUMAN SERVICES/THE ASSISTANT SECRETARY FOR PREPAREDNESS AND RESPONSE (HHS/ASPR) AND AGILITI HEALTH, INC. TO PROVIDE VENDOR MANAGED INVENTORY SERVICE OF MEDICAL VENTILATOR EQUIPMENT SUPPORTING

Place of Performance

Location: ATLANTA, DEKALB County, GEORGIA, 30341

State: Georgia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $59.2 million to AGILITI HEALTH INC for work described as: THIS IS A CONTRACT BETWEEN THE DEPARTMENT OF HEALTH AND HUMAN SERVICES/THE ASSISTANT SECRETARY FOR PREPAREDNESS AND RESPONSE (HHS/ASPR) AND AGILITI HEALTH, INC. TO PROVIDE VENDOR MANAGED INVENTORY SERVICE OF MEDICAL VENTILATOR EQUIPMENT SUPPORTING Key points: 1. Contract provides vendor-managed inventory for critical medical ventilator equipment. 2. Focus on ensuring readiness and availability of essential medical supplies. 3. Contract duration of 214 days indicates a short-term or surge requirement. 4. The firm-fixed-price structure aims to control costs for the government. 5. This award supports the Assistant Secretary for Preparedness and Response's mission. 6. The service category is 'Other Electronic and Precision Equipment Repair and Maintenance'.

Value Assessment

Rating: fair

The contract value of $59.2 million for a 214-day period suggests a significant investment in maintaining critical medical equipment inventory. Benchmarking this against similar vendor-managed inventory contracts for medical equipment is challenging without more specific service details. However, the cost per day is approximately $276,760, which appears high and warrants further investigation into the scope of services provided and the specific types of ventilator equipment managed. The firm-fixed-price nature provides cost certainty but does not inherently guarantee value for money without performance metrics.

Cost Per Unit: Approximately $276,760 per day. Comparison to market rates for similar vendor-managed inventory services for medical equipment is difficult without detailed service scope.

Competition Analysis

Competition Level: sole-source

This contract was not competed under simplified acquisition procedures, indicating a sole-source award. The lack of competition means that the government did not explore potential alternative vendors or pricing structures. This approach may be justified in emergency situations where rapid procurement is necessary, but it limits the government's ability to secure the most competitive pricing and potentially the best value.

Taxpayer Impact: For taxpayers, a sole-source award means there was no opportunity to benefit from competitive bidding, which could have led to lower prices or better terms.

Public Impact

Benefits the Department of Health and Human Services (HHS) and the Assistant Secretary for Preparedness and Response (ASPR) by ensuring the availability of critical medical equipment. Provides vendor-managed inventory services for medical ventilator equipment. Supports national preparedness and response capabilities for public health emergencies. Ensures that healthcare facilities have access to necessary equipment during critical times. Indirectly benefits the healthcare workforce by ensuring they have the tools needed to treat patients.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpayment and missed opportunities for better pricing.
The high daily cost warrants scrutiny to ensure efficient use of taxpayer funds.
Limited transparency into the specific services rendered for the total contract value.

Positive Signals

Ensures critical medical equipment is available, supporting public health emergency preparedness.
Vendor-managed inventory can streamline logistics and reduce the burden on government personnel.
Firm-fixed-price contract provides cost certainty for the government.

Sector Analysis

The healthcare sector, particularly in the context of emergency preparedness, relies heavily on specialized equipment and robust supply chain management. Contracts for medical equipment maintenance and inventory management are crucial for ensuring readiness. The market for such services can be specialized, with a few key players offering comprehensive solutions. This contract fits within the broader category of healthcare logistics and supply chain support, essential for government agencies like ASPR tasked with managing national health emergencies.

Small Business Impact

This contract was awarded to Agiliti Health, Inc. and was not competed under simplified acquisition procedures, nor does it indicate any specific small business set-aside provisions. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal based on the available data, and there is no indication of specific efforts to engage small businesses in this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services (HHS) and its Office of the Assistant Secretary for Preparedness and Response (ASPR). As a sole-source award, transparency might be limited compared to competed contracts. Accountability would be driven by the terms of the firm-fixed-price contract and performance expectations. The Inspector General for HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

HHS/ASPR Emergency Preparedness Contracts
Medical Equipment Maintenance Services
Vendor-Managed Inventory Contracts
Strategic National Stockpile Support
Public Health Supply Chain Management

Risk Flags

Sole-source award may limit price competition.
High daily cost warrants value-for-money assessment.
Limited public information on specific service details.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $59.2 million to AGILITI HEALTH INC. THIS IS A CONTRACT BETWEEN THE DEPARTMENT OF HEALTH AND HUMAN SERVICES/THE ASSISTANT SECRETARY FOR PREPAREDNESS AND RESPONSE (HHS/ASPR) AND AGILITI HEALTH, INC. TO PROVIDE VENDOR MANAGED INVENTORY SERVICE OF MEDICAL VENTILATOR EQUIPMENT SUPPORTING

Who is the contractor on this award?

The obligated recipient is AGILITI HEALTH INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).

What is the total obligated amount?

The obligated amount is $59.2 million.

What is the period of performance?

Start: 2021-07-28. End: 2022-02-27.

What specific services are included in the 'vendor managed inventory service of medical ventilator equipment'?

The provided data indicates the contract is for 'vendor managed inventory service of medical ventilator equipment'. This typically encompasses a range of services including tracking inventory levels, managing stock rotation, ensuring equipment is maintained and functional, and potentially delivering equipment to designated locations as needed. For a contract of this value and duration, it likely involves a comprehensive management system for a significant quantity of ventilators, ensuring their readiness for deployment during emergencies. Detailed service level agreements (SLAs) would define the exact scope, response times, and maintenance protocols.

How does the daily cost of approximately $276,760 compare to industry benchmarks for similar services?

The daily cost of approximately $276,760 for vendor-managed inventory of medical ventilator equipment is substantial. Benchmarking this figure accurately requires detailed knowledge of the specific types and quantities of ventilators managed, the scope of maintenance and logistics services provided, and the geographic coverage. Without this granular information, a direct comparison to industry benchmarks is difficult. However, given the significant daily expenditure, it suggests either a very large inventory of high-value equipment, extensive maintenance requirements, or a premium for rapid availability and emergency response capabilities. Further analysis would be needed to determine if this cost represents good value for money.

What is the justification for awarding this contract on a sole-source basis?

The data states the contract was 'NOT COMPETED UNDER SAP' (Simplified Acquisition Procedures), implying it was likely awarded sole-source or through other non-competitive means. Justifications for sole-source awards often include urgent and compelling needs, unique capabilities of a single provider, or situations where competition is not feasible or practical. In the context of emergency preparedness (HHS/ASPR), there might have been an immediate, critical need for ventilator inventory management that necessitated rapid procurement from a known provider, potentially Agiliti Health, Inc., due to existing relationships, specialized expertise, or immediate availability of their services.

What is the track record of Agiliti Health, Inc. in providing similar services to the federal government?

Agiliti Health, Inc. is a known provider of healthcare services, including equipment management and logistics. While this specific contract is a significant award, Agiliti has a history of working with healthcare providers and potentially government entities. To assess their track record specifically with the federal government for similar services, one would need to examine past federal contract awards, performance reviews, and any reported issues or successes. Their experience in managing critical medical equipment inventory is a key factor in their selection, but a deeper dive into their federal performance history would provide more context on their reliability and effectiveness in this domain.

What are the potential risks associated with a sole-source award for critical medical equipment inventory management?

The primary risks associated with a sole-source award for critical medical equipment inventory management include a lack of competitive pricing, potentially leading to higher costs for the government and taxpayers. There's also a risk that the government may not be accessing the most innovative solutions or the best overall value available in the market, as competition often drives efficiency and service improvements. Furthermore, reliance on a single vendor can create dependency and potential vulnerabilities if that vendor faces operational issues or decides to discontinue services. Without competitive pressure, there might also be less incentive for the vendor to proactively enhance service quality or reduce costs.

How does this contract contribute to the overall mission of the Assistant Secretary for Preparedness and Response (ASPR)?

This contract directly supports the ASPR's mission to lead, manage, and coordinate the federal government's efforts to prepare for, respond to, and recover from public health emergencies. By ensuring that critical medical ventilator equipment is properly managed, maintained, and readily available through a vendor-managed inventory system, ASPR enhances the nation's capacity to respond effectively to health crises. This contract ensures the readiness of essential medical assets, a core component of national preparedness, allowing for quicker and more efficient deployment of resources when needed.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance

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

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sizewise Rentals L.L.C. (UEI: 118040777)

Address: 6625 W 78TH ST STE 300, MINNEAPOLIS, MN, 55439

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

Financial Breakdown

Contract Ceiling: $59,226,708

Exercised Options: $59,226,708

Current Obligation: $59,226,708

Actual Outlays: $59,226,708

Contract Characteristics

Commercial Item: SUPPLIES OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Timeline