HHS awarded $16.3M for occupational health staffing, a sole-source contract with a high per-unit cost

Contract Overview

Contract Amount: $16,264,162 ($16.3M)

Contractor: STG International, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2010-06-29

End Date: 2011-06-30

Contract Duration: 366 days

Daily Burn Rate: $44.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: Healthcare

Official Description: TAS::75 4552 001::TAS OCCUPATIONAL HEALTH STAFFING SUPPORT SERVICES

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20857

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $16.3 million to STG INTERNATIONAL, INC. for work described as: TAS::75 4552 001::TAS OCCUPATIONAL HEALTH STAFFING SUPPORT SERVICES Key points: 1. The contract's value of $16.3 million over 366 days suggests a significant investment in specialized health support. 2. Sole-source procurement raises questions about potential overpayment and lack of competitive pressure on pricing. 3. The contract's duration and cost indicate a substantial need for ongoing occupational health services. 4. The absence of competition limits the government's ability to explore alternative service providers or innovative solutions. 5. Performance context is limited due to the lack of comparative data from a competitive bidding process.

Value Assessment

Rating: questionable

The total award of $16.3 million for a 366-day contract for occupational health staffing appears high, especially given it was sole-sourced. Without competitive bids, it's difficult to benchmark the value effectively against market rates or similar government contracts. The lack of transparency in pricing negotiations for sole-source awards makes a definitive value assessment challenging, but the high dollar amount warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This typically occurs when only one vendor is capable of meeting the requirement, or in emergency situations. The lack of competition means that the government did not benefit from the price discovery and innovation that typically arises from multiple bidders vying for a contract. This can lead to higher prices and potentially less optimal service delivery.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. The government missed an opportunity to secure potentially better pricing and terms through a competitive process.

Public Impact

Federal employees within the Department of Health and Human Services (HHS) likely benefit from the occupational health services provided. The services delivered are expected to support the health and well-being of the federal workforce. The geographic impact is primarily focused on the location of HHS facilities in Maryland. Workforce implications include the employment of occupational health professionals by the contractor to fulfill the service requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs for taxpayers.
Lack of transparency in the procurement process makes it difficult to assess true value for money.
High contract value without clear performance metrics or competitive benchmarks raises concerns about efficiency.

Positive Signals

Contract addresses a critical need for occupational health services within a major federal agency.
The contractor, STG INTERNATIONAL, INC., is providing essential support to the federal workforce.
The contract duration suggests a commitment to sustained health support for employees.

Sector Analysis

Occupational health services fall under the broader healthcare services sector, specifically within the 'All Other Miscellaneous Ambulatory Health Care Services' category. This sector is characterized by a mix of public and private providers, with government contracts often focusing on supporting federal employees or specific public health initiatives. The market size for such specialized staffing can be substantial, driven by regulatory requirements and the need to maintain a healthy and productive workforce. Benchmarking this contract's value is challenging without competitive data, but its scale suggests a significant operational requirement.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides or subcontracting plans. Therefore, it does not appear to directly benefit the small business ecosystem through this specific award. The focus was on securing the required occupational health services, and the procurement method did not prioritize small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services' contracting and program management offices. As a sole-source award, the justification for the procurement method and the contractor's performance would be subject to internal review. Transparency is limited due to the non-competitive nature. There is no specific mention of Inspector General jurisdiction for this particular award, but the HHS OIG generally oversees agency programs and contracts for waste, fraud, and abuse.

Related Government Programs

Federal Occupational Health Services
Department of Health and Human Services Staffing Contracts
Ambulatory Health Care Services Contracts
Government Health Support Services

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency regarding performance metrics and value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $16.3 million to STG INTERNATIONAL, INC.. TAS::75 4552 001::TAS OCCUPATIONAL HEALTH STAFFING SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is STG INTERNATIONAL, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.3 million.

What is the period of performance?

Start: 2010-06-29. End: 2011-06-30.

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

The provided data indicates the contract was 'NOT COMPETED,' which is synonymous with a sole-source award in this context. Federal regulations permit sole-source procurements under specific circumstances, such as when only one responsible source can satisfy the agency's needs, or in cases of urgent and compelling need. Without further documentation from the agency (e.g., a Justification for Other Than Full and Open Competition - JOFOC), the precise reason for this sole-source award remains unknown. However, such awards often stem from unique capabilities, proprietary technology, or established relationships where transitioning to a new vendor would be significantly disruptive or costly.

How does the contract's value compare to similar occupational health staffing contracts?

Direct comparison of this $16.3 million contract to similar occupational health staffing contracts is challenging due to the sole-source nature of this award and the lack of specific service details. Competitive contracts often reveal a range of pricing based on scope, duration, and provider qualifications. Sole-source awards, by definition, bypass this competitive benchmarking. To assess value, one would need to compare the per-diem or per-hour rates against industry standards for comparable roles (e.g., occupational health nurses, physicians) in the Maryland region, and evaluate the scope of services against the total cost. The absence of competitive bids means this price was likely negotiated directly, potentially without the downward pressure that multiple offers would provide.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not include specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this occupational health staffing support services contract. Typically, government contracts, especially those for essential services like healthcare, would outline measurable performance standards. These might include metrics related to response times for employee health issues, availability of medical staff, adherence to health protocols, patient satisfaction, or compliance with regulatory requirements. The absence of this information in the summary data suggests it may be detailed within the full contract document, which is not accessible here. Robust KPIs and SLAs are crucial for ensuring the contractor delivers effective and efficient services and for holding them accountable.

What is the historical spending pattern for occupational health staffing support services at HHS?

The provided data only details a single contract awarded from June 2010 to June 2011 for $16.3 million. To understand historical spending patterns, one would need to analyze HHS's procurement history over several years, looking for all contracts related to occupational health staffing support services. This would involve querying federal procurement databases (like FPDS or USASpending) for similar contract actions, noting their values, durations, procurement methods (competed vs. sole-source), and the specific offices within HHS that awarded them. Without this broader dataset, it's impossible to establish a trend or determine if this $16.3 million award represents a typical, increased, or decreased level of spending for these services.

What is the track record of STG INTERNATIONAL, INC. in providing similar government services?

STG INTERNATIONAL, INC. has a history of providing various services to the federal government, including staffing, healthcare, and logistics support. To assess their track record specifically for occupational health staffing, a deeper dive into their past performance on similar contracts would be necessary. This would involve reviewing contract databases for previous awards to STG in this specific service area, examining their performance evaluations (if publicly available), and looking for any past performance issues or commendations. Their ability to successfully execute this $16.3 million sole-source contract suggests they possess the necessary qualifications and capacity, but a comprehensive review of their broader federal contracting history would provide a more complete picture of their reliability and expertise.

Industry Classification

NAICS: Health Care and Social Assistance › Other Ambulatory Health Care Services › All Other Miscellaneous Ambulatory Health Care Services

Product/Service Code: MEDICAL SERVICES › GENERAL HEALTH CARE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 99 CANAL CENTER PLZ STE 500, ALEXANDRIA, VA, 22314

Business Categories: Asian Pacific American Owned Business, Category Business, Minority Owned Business, Not Designated a Small Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $18,447,715

Exercised Options: $18,447,715

Current Obligation: $16,264,162

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline