HHS awards $3.6M for EKG interpretation, raising questions about competition and value

Contract Overview

Contract Amount: $3,615 ($3.6K)

Contractor: MCI Diagnostic Center LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2018-05-29

End Date: 2019-05-31

Contract Duration: 367 days

Daily Burn Rate: $10/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: IGF::OT::IGF EKG INTERPRETATION SERVICES - PAWNEE

Place of Performance

Location: PAWNEE, PAWNEE County, OKLAHOMA, 74058

State: Oklahoma Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $3,615 to MCI DIAGNOSTIC CENTER LLC for work described as: IGF::OT::IGF EKG INTERPRETATION SERVICES - PAWNEE Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Limited competition may have led to suboptimal pricing. 3. Performance period is relatively short, suggesting a need for ongoing evaluation. 4. The contract falls within the physician services sector, a critical area for healthcare delivery. 5. Spending on this service is a small fraction of overall healthcare expenditures.

Value Assessment

Rating: questionable

The contract value of $3.6 million for EKG interpretation services over approximately one year appears high given the lack of competitive bidding. Without comparable contracts or market benchmarks for similar services provided to the Indian Health Service, it is difficult to definitively assess value for money. The fixed-price nature of the purchase order provides some cost certainty, but the absence of competition prevents a robust comparison against market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT AVAILABLE FOR COMPETITION' basis, indicating that a full and open competition was not conducted. This suggests that either only one source was capable of providing the required services, or there were other justifications for not competing the award. The lack of multiple bidders means that the government did not benefit from the price reductions and service enhancements that typically arise from a competitive bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government missed an opportunity to secure potentially lower prices and better terms through a competitive solicitation.

Public Impact

Patients of the Indian Health Service will benefit from access to EKG interpretation services, crucial for diagnosing cardiac conditions. Services are delivered to support healthcare providers within the IHS network. The geographic impact is likely concentrated within the service areas of the Pawnee Indian Health Service facility. This contract supports the operational capacity of healthcare professionals by outsourcing a specialized diagnostic service.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpayment and limited vendor options.
The 'NOT AVAILABLE FOR COMPETITION' justification warrants further scrutiny to ensure it was appropriate.
Absence of performance metrics in the provided data makes it difficult to assess service quality.

Positive Signals

The contract addresses a critical healthcare need for EKG interpretation.
The fixed-price award provides cost predictability for the period of performance.
The award was made to a single entity, potentially simplifying contract administration.

Sector Analysis

The healthcare sector, particularly diagnostic services, is characterized by specialized expertise and regulatory oversight. EKG interpretation falls under the broader category of medical diagnostic imaging and laboratory services. The market for such services can be fragmented, with both in-house capabilities and outsourced providers. Spending benchmarks for outsourced EKG interpretation vary widely based on volume, turnaround time, and the qualifications of the interpreters. This contract represents a specific instance of the Indian Health Service procuring such a specialized service.

Small Business Impact

The provided data indicates that this contract was not awarded to a small business (ss: false) and there is no indication of small business subcontracting requirements (sb: false). Therefore, this specific award does not appear to directly benefit the small business ecosystem through set-asides or mandated subcontracting. Further investigation would be needed to determine if the prime contractor utilizes small businesses in its own supply chain.

Oversight & Accountability

Oversight for this contract would primarily fall under the Indian Health Service (IHS) within the Department of Health and Human Services (HHS). The Inspector General's office for HHS is responsible for auditing and investigating potential fraud, waste, and abuse within its programs. Transparency is facilitated through contract databases, but the specific performance monitoring and accountability measures implemented by IHS for this particular service are not detailed in the provided data.

Related Government Programs

Indian Health Service Medical Services
HHS Diagnostic Services Contracts
Federal Healthcare Provider Support
EKG Interpretation Services

Risk Flags

Sole-source award
Potential lack of price competition
Limited performance data available

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $3,615 to MCI DIAGNOSTIC CENTER LLC. IGF::OT::IGF EKG INTERPRETATION SERVICES - PAWNEE

Who is the contractor on this award?

The obligated recipient is MCI DIAGNOSTIC CENTER 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 $3,615.

What is the period of performance?

Start: 2018-05-29. End: 2019-05-31.

What is the track record of MCI Diagnostic Center LLC in performing federal contracts, particularly for the Indian Health Service?

Information regarding the specific track record of MCI Diagnostic Center LLC in performing federal contracts, especially with the Indian Health Service, is not detailed in the provided data snippet. A comprehensive review would require accessing historical contract databases (like FPDS-NG) to examine past performance evaluations, any reported issues, and the types of services previously rendered. Understanding their experience with similar healthcare services, their ability to meet delivery timelines, and their compliance with federal regulations would be crucial for assessing their reliability as a contractor for EKG interpretation.

How does the awarded price of $3.6 million for EKG interpretation services compare to market rates for similar services?

Directly comparing the $3.6 million award to market rates is challenging without more specific data on the volume of EKGs interpreted, the required turnaround times, and the qualifications of the interpreters. However, given the sole-source nature of the award, there is a significant risk that the price may not be competitive. Market research for similar outsourced EKG interpretation services typically involves analyzing per-interpretation fees or subscription models. Without a competitive bidding process, the government lacked the leverage to negotiate the best possible price, making it difficult to ascertain if this amount represents fair market value.

What are the specific risks associated with awarding a sole-source contract for essential healthcare services like EKG interpretation?

The primary risks associated with sole-source awards for essential healthcare services include potential overpricing due to lack of competition, reduced incentive for the contractor to innovate or improve service quality, and a lack of flexibility if the contractor's performance deteriorates or their capacity becomes insufficient. For EKG interpretation, this could mean delays in diagnosis, potentially impacting patient care, or paying a premium for a service that could be obtained at a lower cost through competitive means. It also limits the government's ability to switch providers if a better option emerges.

What was the justification for awarding this contract on a non-competitive basis, and was it appropriate?

The provided data indicates the contract was awarded under 'NOT AVAILABLE FOR COMPETITION.' This typically signifies that a justification for other than full and open competition (JOFOC) was approved. Common reasons include that only one responsible source exists, or an exception to the fair opportunity process applies. Without the specific JOFOC document, it's impossible to definitively state the justification. However, for essential services like EKG interpretation, such justifications are often scrutinized to ensure they are valid and that competition was genuinely not feasible or would have caused undue delay or cost.

How has federal spending on EKG interpretation services, particularly within the Indian Health Service, trended over the past five years?

Analyzing historical spending trends for EKG interpretation services within the Indian Health Service (IHS) requires access to comprehensive federal procurement data over multiple years. The provided snippet only details one contract award from 2018-2019. To understand trends, one would need to query databases like FPDS-NG for all contracts categorized under relevant Product Service Codes (PSCs) or North American Industry Classification System (NAICS) codes related to medical diagnostic services and specifically EKG interpretation, filtering by the IHS agency. This would reveal if spending has increased, decreased, or remained stable, and whether reliance on sole-source awards has been consistent.

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: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7018 S UTICA AVE, TULSA, OK, 74136

Business Categories: Black American Owned Business, Category Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $3,615

Exercised Options: $3,615

Current Obligation: $3,615

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline