HHS awards $36.1M contract to American Red Cross for blood and organ bank services

Contract Overview

Contract Amount: $36,130,338 ($36.1M)

Contractor: American National RED Cross, the

Awarding Agency: Department of Health and Human Services

Start Date: 2013-03-29

End Date: 2024-07-01

Contract Duration: 4,112 days

Daily Burn Rate: $8.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Healthcare

Official Description: IGF::CT::IGF AMERICAN RED CROSS:1108672 [13-007730]

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $36.1 million to AMERICAN NATIONAL RED CROSS, THE for work described as: IGF::CT::IGF AMERICAN RED CROSS:1108672 [13-007730] Key points: 1. Contract awarded to a single, established non-profit organization. 2. Long-term contract duration suggests ongoing need for services. 3. Services align with critical public health functions. 4. No small business set-aside indicates focus on specialized capabilities. 5. Cost-plus contract type allows for flexibility but requires careful oversight.

Value Assessment

Rating: fair

The contract's value of $36.1 million over its duration appears reasonable given the critical nature of blood and organ banking services. Benchmarking against similar contracts is challenging without more specific service details, but the American Red Cross is a well-established provider in this space. The 'Cost-No Fee' (CPFF) contract type means the government reimburses allowable costs plus a fixed fee, which can be efficient but necessitates robust cost monitoring to ensure value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to compete. However, the data does not specify the number of bids received. The nature of blood and organ banking services may inherently limit the number of qualified bidders to a few specialized organizations.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages competitive pricing and potentially leads to better value. However, the specific market for these services might be concentrated, impacting the degree of price pressure.

Public Impact

Benefits individuals requiring blood transfusions or organ transplants. Supports hospitals and medical facilities nationwide by ensuring a supply of blood and organs. Contributes to public health infrastructure and emergency preparedness. Impacts the healthcare workforce involved in collection, processing, and distribution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contract type requires diligent oversight to manage expenditures and prevent cost overruns.
Lack of specific performance metrics in the provided data makes it difficult to assess efficiency.
Long contract duration could lead to complacency if not actively managed.

Positive Signals

Award to a reputable and experienced organization like the American Red Cross.
Services are critical to public health and national well-being.
Full and open competition suggests an effort to secure the best possible provider.

Sector Analysis

The healthcare sector, specifically the blood and organ banking sub-sector, is vital for national health security and patient care. This contract falls within the broader category of health services, supporting the critical infrastructure for blood and organ procurement, processing, and distribution. Spending in this area is often driven by public health needs and emergency response requirements.

Small Business Impact

The contract does not appear to have a small business set-aside. Given the specialized nature of blood and organ banking, it is likely that the primary contractor, the American Red Cross, possesses unique capabilities and infrastructure. Subcontracting opportunities for small businesses may exist for ancillary services, but the core function is likely performed by the prime.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within the National Institutes of Health (NIH). The 'Cost-No Fee' (CPFF) contract type necessitates rigorous financial oversight to ensure that all costs incurred are allowable, allocable, and reasonable. Transparency would be enhanced through regular reporting requirements and potential audits.

Related Government Programs

National Blood Collection and Processing
Organ Procurement and Transplantation Network
Public Health Services

Risk Flags

Cost-plus contract type requires close financial oversight.
Long contract duration may increase risk of cost escalation.
Limited public data on specific performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $36.1 million to AMERICAN NATIONAL RED CROSS, THE. IGF::CT::IGF AMERICAN RED CROSS:1108672 [13-007730]

Who is the contractor on this award?

The obligated recipient is AMERICAN NATIONAL RED CROSS, THE.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $36.1 million.

What is the period of performance?

Start: 2013-03-29. End: 2024-07-01.

What is the historical spending trend for blood and organ bank services by the Department of Health and Human Services?

Historical spending data for blood and organ bank services by HHS reveals a consistent need for these critical functions. While specific figures fluctuate year-to-year based on demand and contract renewals, the overall trend indicates sustained investment in ensuring the availability of blood products and organs for transplantation. The American Red Cross, as a primary provider, has historically been a significant recipient of such funding. Analyzing past contract values and durations can provide context for the current $36.1 million award, suggesting a long-term commitment to maintaining these essential services. Factors influencing spending include demographic shifts, advancements in medical procedures, and public health emergencies.

How does the American Red Cross's performance on previous contracts compare to industry benchmarks?

The American Red Cross has a long-standing history of providing blood and organ banking services, often under significant government contracts. While specific performance metrics are not detailed in this data, their consistent engagement with federal agencies suggests a generally reliable track record. Benchmarking their performance against other entities in the blood and organ sector is complex due to the unique operational scale and mission-driven nature of the Red Cross. However, regulatory compliance, successful collection targets, and timely distribution of critical supplies are key indicators of performance. Any past issues or successes would be documented in contract performance reports and potentially reviewed during the procurement process.

What are the primary risks associated with a 'Cost-No Fee' contract for blood and organ banking services?

The primary risks associated with a 'Cost-No Fee' (CPFF) contract for blood and organ banking services revolve around cost control and contractor efficiency. While this contract type allows for flexibility in adapting to unforeseen needs and reimburses the contractor for allowable costs plus a fixed fee, it can incentivize higher spending if not rigorously managed. The government bears the financial risk of cost overruns, and there's a potential for the contractor to be less motivated to find cost savings compared to fixed-price contracts. Effective oversight, detailed cost reporting, and clear definitions of allowable expenses are crucial to mitigate these risks and ensure value for taxpayer money.

What is the estimated market size for blood and organ banking services within the federal government?

Estimating the precise market size for blood and organ banking services solely within the federal government is challenging as much of this critical infrastructure is managed by non-profit organizations like the American Red Cross, which also serve the civilian population. Federal spending in this area is often channeled through agencies like HHS (NIH, CDC) and DOD for military medical support. The total federal expenditure likely represents a significant portion of the overall funding required to maintain national blood reserves and organ transplant networks. While specific aggregate figures are not readily available, the recurring nature of these contracts and their critical importance suggest a substantial and consistent federal investment.

How does the duration of this contract (4112 days) impact potential cost savings or risks?

The extended duration of this contract, approximately 11.3 years, offers both potential benefits and risks. On the positive side, it provides stability and predictability for both the government and the contractor, allowing for long-term planning and investment in infrastructure and personnel. This can lead to operational efficiencies and potentially lower per-unit costs over time due to economies of scale. However, a long duration also increases the risk of cost escalation due to inflation, changes in market conditions, or technological advancements that might render current methods less efficient. It also necessitates robust contract management and periodic reviews to ensure continued value and alignment with evolving needs, as well as to guard against potential complacency.

Industry Classification

NAICS: Health Care and Social Assistance › Other Ambulatory Health Care Services › Blood and Organ Banks

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 2025 E ST NW, WASHINGTON, DC, 20006

Business Categories: Category Business, Corporate Entity Tax Exempt, Domestic Shelter, Manufacturer of Goods, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $63,543,930

Exercised Options: $36,130,338

Current Obligation: $36,130,338

Actual Outlays: $8,595,202

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline