36C10B19Q0305-003.pdf

National Teleradiology Program PACS Upgrade Control Number: TAC-19-54554 Service/Support

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity: Department of Veterans Affairs (VA) Office of Procurement, Acquisition and Logistics

Technology Acquisition Center 23 Christopher Way Eatontown, New Jersey 07724

2. Description of Action: The proposed action is for a sole source, firm-fixed-price (FFP) contract with Intelerad, Inc. (Intelerad) for maintenance and technical support for the existing VA National Teleradiology Program (NTP) Picture Archive and Communication System (PACS).

3. Description of the Supplies or Services: VA requires maintenance and technical support for the PACS platform to upgrade NTP’s existing system along with subsequent system maintenance and support after completion of the upgrade. Maintenance would include the repair and replacement of hardware as needed for the system to remain operable after the upgrade is completed. Technical support would involve upgrading the NTP PACS from IntelePACS version 4.9 and migrating all NTP PACS specific applications from IntelePACS version 4.9 to 4.16 or newer. IntelePACS version 4.9, upon which VA NTP’s relies on for its PACS will reach end of life at the end of 2021.

The upgraded IntelePACS version 4.16 will be installed on the existing NTP infrastructure and, as a component of the upgrade process, the Contractor will be required to upgrade the PACS server operating system (OS) to a version that is compatible with the PACS application. VA currently utilizes the Linux OS on all NTP PACS servers from RedHat Enterprise License (REHL) 6.x. Upon upgrading to IntelePACS version 4.16 or newer, all NTP PACS servers will need to upgrade in tandem in order to ensure a seamless transition. The current recommended OS for an IntelePACS upgrade/deployment is RHEL version 8. The entire upgrade to include the IntelePACS upgrade and subsequent OS upgrade is projected to take between 28-36 months. The extensive timeline is required due to the time and effort required to complete the upgrade. A complete preliminary analysis of NTPs components must be performed to determine which can be transferred to version 4.16 and which require additional coding to achieve compatibility. Following analysis and upgrade of the components, validation and testing must be performed in a manner that ensures no disruption to the system’s performance and to ensure that it remains in continuous operation. To accomplish this, the system upgrade will have to be performed outside of critical operating hours and must be very closely coordinated with NTP’s clinical operations, which adds to the timeline.

This requirement also includes two years of post-upgrade support which includes furnishing all necessary replacement hardware or hardware components, software, software updates, ongoing software development for the PACS system and assignment engine optimization and technical support services required to maintain the NTP PACS and all associated components at a minimum 99.9% uptime. No new software is being procured under this proposed action, and no new hardware will be procured other than hardware components that may be needed for routine maintenance of the system as part of normal use and wear.

The period of performance is 30 months from date of contract award with two 12-month option periods for post-upgrade system support. VA requires this length of PoP as it anticipates utilizing this system for a minimum of five years. No new software is being procured under this proposed action (only upgrades to existing software and OS) and hardware replacement parts are included in the scope of service for the two 12-month option periods which cover full system maintenance, service and support.

4. Statutory Authority: The statutory authority permitting other than full and open competition is Section 41 U.S.C. 3304(a)(1) as implemented by the Federal Acquisition Regulation (FAR) Subpart 6.302-1 entitled, “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

5. Rationale Supporting Use of Authority Cited Above: The proposed source for this action is Intelerad, 895 De La Gauchetiere Street West, Suite 400, Montreal, QC H3B4G1 Canada. Intelerad is the Original Equipment Manufacturer (OEM) of the NTP PACS brand name software (IntelePACS) and currently provides maintenance support for the existing PACS system. Intelerad is the only source capable of meeting VA’s requirements due to the proprietary nature of the current products. The NTP PACS is comprised of various interrelated components of hardware and IntelePACS brand name software and licenses. The IntelePACS software is proprietary in nature and is the intellectual property of Intelerad. Only Intelerad can access the proprietary source code for IntelePACS software which is needed to service, support, update and upgrade the components of the PACS. Access to this proprietary data is also required to ensure all the services provided are properly configured and the system remains in continuous operation throughout the upgrade project. Since Intelerad does not sell the PACS software or support through resellers, Intelerad is the only source that is able to provide the updates and upgrades to the IntelePACS software. In addition, only Intelerad specified hardware replacement parts can meet all of VA’s form, fit, function and compatibility requirements. Specifically, use of non-compatible hardware components would not function in the existing Intelerad items. In addition, the hardware maintenance required must be configured to work with the Intelerad brand name software and thus cannot be separated.

The FDA requires medical device manufacturers to possess 510K certification to market medical devices and systems and ongoing software updates and upgrades must be similarly reviewed or go through the vendor’s internal quality certification process to ensure that they are safe and effective for their intended use. The NTP’s PACS from Intelerad, IntelePACS, falls under this requirement. In accordance with Section 510(k) of the Food, Drug and Cosmetic Act, medical devices used in patient care must be certified by the FDA and due to the proprietary nature of IntelePACS, only the OEM can update/upgrade the NTP PACS application. The 510K certification is a premarket submission made to the FDA to demonstrate that the device to be marketed is at least as safe and effective, that is, substantially equivalent, to a legally marketed device. In this instance, the previously marketed devices are IntelePACS and InteleViewer. Intelerad is the only vendor possessing 510K certification (K150707) for the IntelePACS and InteleViewer products.

Accordingly, Intelerad is the singular entity that can legally provide software upgrades to the system and possesses the proprietary knowledge of the system and associated coding components required for ongoing system sustainment and expansion. Only Intelerad has the detailed understanding and access to the proprietary code of the software capabilities and function to immediately address any software functionality issues.

As NTP PACS is a mission critical medical system delivering care for up to 2500 critical patients per day, it is imperative that this upgrade along with maintenance, support and sustainment of the system be provided by a contractor with expert level knowledge of the application/system and access to the proprietary code which is only available through the OEM who developed the application and provides ongoing support as a key component of their core business. Utilization of another vendor’s PACS support team would require replacement of the IntelePACS software and associated hardware as they would have no capability to support the system in place. Replacement of the PACS would require 18-24 months for deployment, which would result in extensive delivery delays and extensive duplication of costs that would not be recovered through competition and would also be clinically unacceptable, particularly given the strict system uptime requirements.

The upgrade approach utilizes all of the existing NTP PACS infrastructure and hardware, while maintaining existing interfaces at over 100 VA facilities. Wholesale replacement of the PACS would entail full hardware replacement, new deployments and reconfiguration of each facility’s VistA and DICOM interfaces. Additionally, NTP requires the PACS vendor to undertake interface development work over the next 12 months to validate functionality with VHA’s new Electronic Health Record Modernization (EHRM) for initial site deployment in VISN 20. An in-place upgrade provides the opportunity to maintain continuity of operations with existing VA hospitals with serial transition to the new EHRM sites as they come on line. With a comprehensive PACS replacement from another vendor, it would introduce significantly increased risk and complexity if we were to attempt to activate a completely new PACS concurrent with EHRM deployment

Continuity of service/support coverage is essential to maintain continuous operation of the NTP PACS. Due to the scale and complexity of the NTP PACS, there are multiple work orders or support tickets submitted every day that require action by the PACS vendor to resolve a technical issue to allow one or more exams to be successfully received and dictated. While issues may be as limited as impacting a single STAT case, they can also be significant in scope such that it will impact an entire VISN or the NTP PACS as a whole. For larger scale issues such as those on a VISN level, they can impact hundreds of critical patients, delaying their care and treatment. Significant harm can come to critical patients when their STAT interpretations and subsequent treatments are delayed, which is why it is imperative that there is no break in support coverage for the NTP PACS.

6. Efforts to Obtain Competition: Market research was conducted, details of which are in the market research section of this document. No competition is anticipated. In accordance with FAR 5.201, the proposed action will be synopsized on the Federal Business Opportunities Page (FBO) and this justification will also be made publicly available within 14 days after contract award in accordance with FAR 6.302-1(c). Any responses received from the synopsis posting will be evaluated.

7. Actions to Increase Competition: In order to remove or overcome barriers to competition in future acquisitions for this requirement, the agency will work with the program office to perform additional market research so that other solutions can be considered.

8. Market Research: Market research was conducted by the Government’s technical experts in late 2018 and early 2019 by reviewing similar clinical products and services such as Philips and VIsage PACS to ascertain if these vendors could meet VA’s requirements and if their technical support departments had the demonstrated capability to perform an upgrade to the NTP IntelePACS system, and to provide subsequent service and support of the system. Specifically, the Government’s technical experts conducted research on web sites and utilized first-hand knowledge of commercial PACS that are deployed within VA. As a result, the technical experts confirmed that none of the vendors researched were able to meet VA’s requirements as outlined in Section 5 of this justification.

9. Other Facts: The current version of the NTP PACS, IntelePACS 4.9, will reach end of life on November 30, 2020 and VA NTP is currently utilizing a VA NTP-specific version of the PACS, which requires a dedicated support team due to all of the customization NTP requires. Absent an upgrade to VA NTP’s PACS, there will be a significant cost premium for ongoing PACS support, since there are additional costs associated with both the NTP specific applications and an added cost to maintain the system past its designated end of life. The current estimate is that there will be an additional cost to support the NTP PACS if it goes end of life of $600,000 in the first-year past end of life and $916,000 additional in the second year. These costs will be avoided provided the upgrade is completed in advance of the PACS’s end of life date.