HHS awards $2.5M contract for orthopedic services in New Mexico, competed under SAP

Contract Overview

Contract Amount: $2,518,450 ($2.5M)

Contractor: CHG Companies, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2023-03-23

End Date: 2025-09-30

Contract Duration: 922 days

Daily Burn Rate: $2.7K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: LABOR HOURS

Sector: Healthcare

Official Description: CONTRACTOR SHALL PROVIDER ORTHOPEDIC SERVICES.

Place of Performance

Location: GALLUP, MCKINLEY County, NEW MEXICO, 87301

State: New Mexico Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $2.5 million to CHG COMPANIES, INC. for work described as: CONTRACTOR SHALL PROVIDER ORTHOPEDIC SERVICES. Key points: 1. Value for money appears reasonable given the contract type and duration. 2. Competition dynamics indicate a potentially efficient procurement process. 3. Risk indicators are low, with a clear service requirement and established contractor. 4. Performance context is focused on specialized medical services. 5. Sector positioning is within healthcare services, specifically physician support.

Value Assessment

Rating: good

The contract value of $2.5 million over approximately 2.5 years for orthopedic services seems aligned with market rates for specialized medical support. While direct comparisons are difficult without more granular service details, the award under Simplified Acquisition Procedures (SAP) suggests a focus on smaller, efficient procurements. The pricing structure, likely based on labor hours, allows for flexibility but requires diligent oversight to ensure cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was competed under Simplified Acquisition Procedures (SAP), which allows for a broader range of competition for smaller dollar value procurements. While the specific number of bidders is not detailed, the SAP process generally encourages multiple offers, leading to competitive pricing. The use of SAP suggests that the agency sought to balance competition with procurement efficiency for this service need.

Taxpayer Impact: Competing under SAP for this contract likely resulted in a fair market price for taxpayers by leveraging a competitive environment while maintaining efficient acquisition timelines.

Public Impact

Beneficiaries include Native American communities in New Mexico requiring orthopedic care. Services delivered encompass essential orthopedic medical support. Geographic impact is concentrated within New Mexico. Workforce implications involve the provision of specialized medical professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if service needs expand beyond initial estimates.
Ensuring consistent quality of care across the contract duration.

Positive Signals

Clear definition of services required.
Contract awarded to a known entity (CHG Companies, Inc.).
Procurement conducted through a competitive process.

Sector Analysis

The healthcare services sector is vast, with significant federal spending on medical support and specialized care. This contract falls within the 'Offices of Physicians' category, specifically focusing on orthopedic services. Federal agencies like the Indian Health Service frequently contract for such specialized medical expertise to serve underserved populations, often benchmarking against private sector rates while ensuring compliance with federal acquisition regulations.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. The award to CHG COMPANIES, INC. does not preclude them from utilizing small businesses in their subcontracting efforts, but this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically fall under the Indian Health Service's program management and contracting offices. Accountability measures would include performance monitoring against the contract's Statement of Work and adherence to service level agreements. Transparency is facilitated through federal contract databases, though detailed performance metrics may not be publicly available.

Related Government Programs

Indian Health Service Contracts
Medical Services Contracts
Orthopedic Care Programs

Risk Flags

Potential for inconsistent service quality.
Risk of cost overruns if labor hours are not managed effectively.
Dependence on contractor's ability to source qualified personnel in the region.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $2.5 million to CHG COMPANIES, INC.. CONTRACTOR SHALL PROVIDER ORTHOPEDIC SERVICES.

Who is the contractor on this award?

The obligated recipient is CHG COMPANIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $2.5 million.

What is the period of performance?

Start: 2023-03-23. End: 2025-09-30.

What is the track record of CHG COMPANIES, INC. in providing similar orthopedic services to federal agencies?

Information regarding CHG COMPANIES, INC.'s specific track record in providing orthopedic services to federal agencies is not detailed in the provided data. However, the award of this contract suggests they have met the qualifications and requirements set forth by the Indian Health Service. Further investigation into their past performance ratings, other federal contracts, and client feedback would be necessary for a comprehensive assessment of their track record in this specialized area. Understanding their experience with government contracting regulations and their capacity to deliver consistent, high-quality care within the specified geographic region would also be crucial.

How does the awarded amount compare to similar orthopedic service contracts within the federal government?

Directly comparing the $2.5 million award for orthopedic services is challenging without granular details on the scope of work, duration, and specific services rendered. However, the contract was competed under Simplified Acquisition Procedures (SAP), typically used for procurements valued between $10,000 and $250,000, though thresholds can be higher under certain conditions. The total value suggests a significant scope or duration. Benchmarking against other IHS or VA contracts for physician services, particularly specialists, would provide a better context. The pricing is likely influenced by labor hour rates, which can vary significantly based on geographic location and the specific expertise required for orthopedic care.

What are the primary risk indicators associated with this contract, and how are they being mitigated?

The primary risk indicators for this contract revolve around service delivery and quality assurance. Ensuring that CHG COMPANIES, INC. consistently provides high-quality orthopedic care that meets the needs of the patient population is paramount. Mitigation strategies likely include clearly defined performance standards in the contract, regular performance reviews by the Indian Health Service, and potentially site visits or patient feedback mechanisms. Another risk could be related to the availability of specialized orthopedic personnel in the New Mexico region, which the contractor must manage. The contract's structure, based on labor hours, also carries a risk of cost overruns if not managed tightly, necessitating robust oversight from the agency.

How effective is the Indian Health Service in managing contracts for specialized medical services like orthopedics?

The effectiveness of the Indian Health Service (IHS) in managing contracts for specialized medical services like orthopedics can be assessed through various lenses. Their ability to secure necessary services for underserved populations, as indicated by this contract award, suggests a functional procurement process. However, challenges can arise in ensuring consistent quality, managing costs, and addressing geographic disparities in healthcare access. The IHS operates under specific mandates to serve Native American communities, which can involve unique contracting complexities. Evaluating their effectiveness would require analyzing contract performance data, patient outcomes, and stakeholder feedback over time, as well as comparing their contract management practices to those of other federal healthcare providers.

What are the historical spending patterns for orthopedic services by the Indian Health Service?

Historical spending patterns for orthopedic services by the Indian Health Service (IHS) are not detailed in the provided data. However, it is understood that the IHS consistently allocates funds towards medical services to meet the healthcare needs of eligible American Indians and Alaska Natives. Spending on specialized services like orthopedics would fluctuate based on demand, availability of in-house specialists, and the geographic distribution of facilities. Analyzing past IHS budgets and contract awards for medical professionals would reveal trends in their investment in orthopedic care, potentially showing an increase or decrease in reliance on contracted services over time.

Industry Classification

NAICS: Health Care and Social Assistance › Offices of Physicians › Offices of Physicians (except Mental Health Specialists)

Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 75H71023P00011

Offers Received: 3

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 7259 S BINGHAM JUNCTION BLVD, MIDVALE, UT, 84047

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

Financial Breakdown

Contract Ceiling: $2,518,450

Exercised Options: $2,518,450

Current Obligation: $2,518,450

Actual Outlays: $2,518,450

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline