HHS awards $6.77M for emergency physician services at Kayenta Healthcare Center, serving Arizona's Navajo Nation

Contract Overview

Contract Amount: $6,774,320 ($6.8M)

Contractor: BAY Area Anesthesia LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-04-07

End Date: 2026-12-31

Contract Duration: 633 days

Daily Burn Rate: $10.7K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 8

Pricing Type: LABOR HOURS

Sector: Healthcare

Official Description: CONTRACTOR SHALL PROVIDE EMERGENCY PHYSICIAN SERVICES TO THE KAYENTA HEALTHCARE CENTER IN KAYENTA, AZ.

Place of Performance

Location: KAYENTA, NAVAJO County, ARIZONA, 86033

State: Arizona Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $6.8 million to BAY AREA ANESTHESIA LLC for work described as: CONTRACTOR SHALL PROVIDE EMERGENCY PHYSICIAN SERVICES TO THE KAYENTA HEALTHCARE CENTER IN KAYENTA, AZ. Key points: 1. Contract provides essential emergency physician services, crucial for remote healthcare access. 2. Competition was conducted under Simplified Acquisition Procedures (SAP), suggesting a focus on smaller value procurements. 3. The contract duration of over two years indicates a need for sustained medical staffing. 4. Performance is located in Kayenta, Arizona, highlighting service delivery to the Navajo Nation. 5. The award type is a Purchase Order, common for services with defined scopes and durations. 6. The North American Industry Classification System (NAICS) code 621111 points to physician office services.

Value Assessment

Rating: good

The contract value of $6.77 million over approximately 2 years for emergency physician services appears reasonable given the specialized nature of the work and the remote location. Benchmarking against similar contracts for physician services in underserved or tribal areas would provide a more precise value assessment. The absence of detailed performance metrics in the provided data makes a definitive value-for-money judgment challenging, but the award addresses a critical healthcare need.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a limited number of bidders and less formal solicitation processes compared to full and open competition. While the specific number of bidders is not provided, SAP is generally used for procurements valued below the threshold for full and open competition. This approach aims for efficiency but may result in less aggressive pricing than a broader competition.

Taxpayer Impact: For taxpayers, competition under SAP can lead to quicker contract awards and potentially lower administrative costs. However, it might also mean foregoing the potential for greater cost savings that could arise from a wider, more competitive bidding process.

Public Impact

Beneficiaries include residents of Kayenta, Arizona, and the surrounding Navajo Nation, who gain access to essential emergency medical care. Services delivered are emergency physician services, critical for immediate medical interventions. Geographic impact is concentrated in Kayenta, Arizona, addressing healthcare disparities in a rural and tribal area. Workforce implications include the provision of specialized medical professionals to a needed healthcare facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to SAP procedures could impact price optimization.
Ensuring consistent quality of care in a remote location requires robust oversight.
Dependence on a single contractor for critical emergency services poses a risk if performance falters.

Positive Signals

Addresses a critical healthcare need in an underserved community.
Contract duration suggests a commitment to sustained service provision.
Awarding to a specialized provider like Bay Area Anesthesia LLC indicates a focus on expertise.

Sector Analysis

This contract falls within the Healthcare sector, specifically focusing on physician services. The market for healthcare staffing, particularly in specialized or remote areas, is often characterized by high demand for qualified professionals. The value of this contract is relatively modest within the broader federal healthcare spending landscape, but it represents a significant investment in local healthcare infrastructure and access for a specific community.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside criterion for this contract (ss: false, sb: false). Therefore, the direct impact on small business subcontracting is not explicitly defined. However, the nature of the service (physician staffing) might involve larger healthcare groups, potentially limiting direct subcontracting opportunities for smaller entities unless specialized support services are required.

Oversight & Accountability

Oversight of this contract would primarily fall under the Indian Health Service (IHS), a division of HHS. Accountability measures would likely be tied to the terms and conditions of the Purchase Order, including service delivery standards, staffing levels, and reporting requirements. Transparency is facilitated by federal contract databases, but detailed operational oversight specifics are not publicly available.

Related Government Programs

Indian Health Service Contracts
Rural Healthcare Services
Emergency Medical Services
Physician Staffing Contracts

Risk Flags

Potential for limited competition
Reliance on contractor for critical services
Geographic isolation challenges

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $6.8 million to BAY AREA ANESTHESIA LLC. CONTRACTOR SHALL PROVIDE EMERGENCY PHYSICIAN SERVICES TO THE KAYENTA HEALTHCARE CENTER IN KAYENTA, AZ.

Who is the contractor on this award?

The obligated recipient is BAY AREA ANESTHESIA LLC.

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 $6.8 million.

What is the period of performance?

Start: 2025-04-07. End: 2026-12-31.

What is the track record of Bay Area Anesthesia LLC in providing similar healthcare services to federal agencies, particularly IHS?

A thorough review of Bay Area Anesthesia LLC's contract history with federal agencies, especially the Indian Health Service, is necessary to assess their track record. Information regarding past performance, any documented issues, or successful contract completions would provide insight into their reliability and capability. Without specific data on their past federal performance, it is difficult to definitively assess their suitability beyond the current award. Federal procurement databases and past performance reviews, if available, would be key resources for this analysis.

How does the awarded price compare to market rates for emergency physician services in similar rural or tribal healthcare settings?

To benchmark the value, a comparison of the contract's estimated cost against prevailing market rates for emergency physician services in comparable rural or tribal healthcare settings is essential. Factors such as geographic isolation, cost of living, and the specific scope of services (e.g., physician specialties, call coverage requirements) influence these rates. Analyzing data from similar IHS facilities or other federal healthcare providers in remote areas would help determine if the $6.77 million award represents a fair and reasonable price. The absence of detailed cost breakdowns makes this comparison challenging without further data.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential disruptions in physician staffing, challenges in maintaining consistent quality of care due to the remote location, and contractor performance issues. Mitigation strategies likely involve robust contract management by the IHS, including clear performance standards, regular reporting, and contingency plans for staffing shortages. The limited competition aspect also presents a risk if the contractor fails to perform, as finding a replacement quickly might be difficult. The contract duration and the critical nature of the service necessitate proactive risk management.

How effective is the Indian Health Service in ensuring adequate healthcare access through contracts like this in remote areas?

The effectiveness of IHS in ensuring healthcare access via contracts is multifaceted. This award demonstrates a commitment to providing essential services to the Kayenta community. However, overall effectiveness depends on consistent funding, efficient procurement processes, strong contract oversight, and the ability to attract and retain qualified providers in challenging locations. Evaluating IHS's broader success would require analyzing patient outcomes, access metrics, and satisfaction surveys across its network, not just this single contract.

What has been the historical spending pattern for emergency physician services at the Kayenta Healthcare Center?

Analyzing historical spending for emergency physician services at the Kayenta Healthcare Center would reveal trends in demand, pricing, and contractor stability. If this is a new requirement or a significant increase from previous spending, it warrants further investigation into the reasons. Understanding past expenditures helps in assessing the reasonableness of the current award and identifying any potential cost escalations or shifts in service needs. Data on prior contracts, including their values and durations, would be crucial for this historical context.

Industry Classification

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

Product/Service Code: MEDICAL SERVICES › OTHER MEDICAL SERVICES

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 75H71025Q00010

Offers Received: 8

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 1839 S ALMA SCHOOL RD STE 335, MESA, AZ, 85210

Business Categories: American Indian Owned Business, Category Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $6,774,320

Exercised Options: $6,774,320

Current Obligation: $6,774,320

Actual Outlays: $2,960,685

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline