36C10G19R0050-0001002.pdf

MEDICAL/SURGICAL PRIME VENDOR 2.0 STATEMENT OF WORK (SOW)

DEPARTMENT OF VETERANS AFFAIRS

Tracker ID:

October 18, 2019

Prepared By:

Office of Procurement, Acquisition and Logistics (OPAL)

Strategic Acquisition Center (SAC)

10300 Spotsylvania Avenue, Suite 400

Fredericksburg, VA 22408

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Table of Contents

Scope

Background Scope Government Authorized Customers

Type of Contract

MSPV Business Processes

Commercial Supplier Agreements for Medical Surgical Supplies Prime Vendor Order Number (PVON) for New PVs Supply Classification PV Support Issue Resolution

VA Ordering Procedures

Contract/Delivery Orders Emergency Orders for Core and Non-Core List Supplies

Work Requirements for Prime Vendors

Contract Phase-in/out Core List Creation and Management

MSPV 2.0 Product List Requirements New Authorized Customer Joining a Region during PoP Core List Supply Report

Customer Service Drop Shipments

Shelf Life

Substitute Supplies

Delivery, Risk of Loss, and Inspection & Acceptance Terms Packaging and Storage Temperature Requirements

Hazardous Materials (HAZMAT) and Dangerous Goods Supply Recall Notification Returned Goods Policy Ordering Options

General Information Consumption Report and Price Adjudication Process Authorized Supplier Utilization Report Metrics Fill Rate

Order Lead/Delivery Time

MSPV 2.0 Program Spend

Estimated Program Spend

Pricing of Distribution Services

Prime Vendor Conventional/Bulk Distribution Fee Supply Pricing Full-Time, On-Site Customer Service Representative (OSR) Part Time, On-Site Customer Service Representative

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LUM

Alternate Delivery Locations Stockless Service Will Call

Additional Distribution and Supply Management Services

Appendix A: Definitions

Appendix B: Acronyms

Appendix C: VISN Map and Table

Appendix D: Performance Requirements Summary

Appendix E: Federal Bureau of Prisons (BOP) Security Requirements for

Supply Delivery

Attachments

Attachment I: VAMC and OGA Facilities

Attachment II: Product Categories

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MEDICAL/SURGICAL PRIME VENDOR 2.0

Scope

Definitions may be found in Appendix A: Definitions.

Background

1. The U.S. Department of Veterans Affairs (VA), Veterans Health Administration

(VHA) manages the United States’ largest integrated healthcare system, providing care at 1,243 health care facilities (Attachment I: VAMC and OGA Facilities), including 172 medical centers and 1,062 outpatient sites of care of varying complexity (VHA outpatient clinics), serving approximately 9 million enrolled

Veterans each year. The healthcare system receives most of medical and surgical supply support through the Medical/Surgical Prime Vendor (MSPV) program.

2. This contract shall be administered by the VA’s Strategic Acquisition Center (SAC) in Fredericksburg, VA and its assigned Contracting Officer (CO).

Scope

1. This Statement of Work (SOW) provides for performance of MSPV support for VA

Authorized Customers within the geographic area specified in Appendix C: VISN

Map and Table herein. The Prime Vendor (PV) will propose for the MSPV contracts by Veteran Integrated Service Network (VISN). These VISNs are comprised of groups of VA Medical Centers (VAMCs) and multiple VISNs may be awarded to the same Offeror. PV support includes comprehensive distribution and supply management functions necessary to assure delivery and availability of certain covered medical/surgical supplies identified in a VA-provided and maintained MSPV 2.0 Product List.

a. Authorized Customers eligible to place orders under this SOW are defined in

Section I.C. Government Authorized Customers herein.

b. Covered medical/surgical supplies eligible for order and distribution under this SOW are defined as medical, surgical, dental and laboratory supplies identified on the MSPV 2.0 Product List separately established by VA, which is being made available to PVs in Attachment II: Product Categories. For each MSPV 2.0 Product List supply, VA has identified an authorized source of supply and pricing through a separate competitive Request for Quote(s)

(RFQ), evaluation, and selection process. Pricing established through this process will be maintained as the pricing for each supply. The MSPV 2.0 list of authorized suppliers will be made available to PVs; it is anticipated that supplies will be added to and removed from the MSPV 2.0 Product List throughout the Period of Performance (PoP) of this SOW. The MSPV 2.0

Product List, in addition to serving as a comprehensive list of supplies

SOW – MSPV 2.0 Page 5 of 72 available for order under this SOW, shall serve as the basis for a narrower, facility-specific Core List of medical/surgical supplies to be used as the basis for recurring Authorized Customer orders under this SOW.

c. The PVs shall fill supply orders placed under this SOW by establishing commercial agreements with all VA authorized suppliers to distribute the specific supplies identified on the MSPV 2.0 Product List. In establishing these commercial agreements, the PV shall assure that the agreements contain all VA-required terms, conditions and/or clauses. Prices billed between PVs and authorized suppliers for supplies shall be agreed-upon between those parties based on commercial costs and any agreed-upon commercial fees.

d. The PVs shall be responsible for managing all aspects of supplier relationships necessary to assure timely delivery of covered medical/surgical supplies that comply in all aspects with the Government’s requirements as set forth in this SOW and in orders issued pursuant thereto. This includes, but is not limited to, liability for payment to suppliers for supplies delivered to VA

Authorized Customers.

e. The commercial fees PVs charge to VA authorized suppliers will be capped at

5% of supplied volume to the VA through the PV. The fee is 5% of the price on the MSPV 2.0 Product List. Such fees may include, but are not limited to, payment terms, cash discounts for prompt payment, electronic funds transfer

(EFT) or Automated Clearing House (ACH) fee, administrative fees, reporting/tracing fees, distribution fees, procurement and inventory management fees, and return fees. Such fees shall be outlined between the PV and the VA authorized supplier.

f. As orders under this SOW are filled, PVs will invoice VA for the actual price of the medical/surgical supplies delivered to VA (which shall be at the pricing assigned to that same supply on VA’s MSPV 2.0 Product List); plus an added distribution fee calculated as provided in Section I.D Type of Contract, herein, and in the Contract Pricing Schedule.

g. The PV roles and expectations are outlined in Section II.D PV Support.

2. Specifically excluded from the scope of this SOW:

a. Orders for Reusable Medical Equipment (RME), except as necessary to assist with the set of specific medical/surgical supplies included in the MSPV 2.0

Product List. Additional information on RME can be found in Appendix A:

Definitions.

b. Orders for High Tech Medical Equipment (HTME).

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c. Orders for or including any supply that is not expressly identified on VA’s

MSPV 2.0 Product List (except supplies removed from VA’s MSPV 2.0

Product List, which may be delivered up to 90-consecutive days after the date of removal).

d. Orders to be filled by a source other than the authorized source identified for that supply in MSPV 2.0 list of authorized suppliers.

e. Orders that would require payment of a base supply price that exceeds the pricing indicated for the ordered supply as indicated in the MSPV 2.0 Product

List.

f. Orders placed by organizations located outside the PV’s assigned/awarded geographical area of coverage, or that do not qualify as Authorized Customers under this SOW.

3. Nothing in this SOW shall preclude, restrict or limit any Authorized Customer from filling requirements for covered supplies via any other procurement method or contract instrument, even though the supplies are eligible to be ordered under this

SOW.

4. The Office of Procurement for VHA will ensure that supplies are placed on the

MSPV 2.0 Product List from which Authorized Customers may order. It is incumbent on the PV to honor the parameters of the contract scope of work set forth in this SOW. The PV shall screen all orders on receipt to identify all potential conflicts or questionable instances where supplies are not clearly within the parameters of this SOW and shall seek the CO’s guidance on scope concerns in advance of filling any such orders. Additional contracts and supplies may be added over the lifecycle of this program and any addition of supplies or suppliers will be communicated to the PV. The CO is responsible for making the final determination as to whether any order or supply is or is not within scope of this SOW.

5. The PV shall not be entitled to payment in any instances where supplies are provided (or prices are charged) outside the scope of this SOW.

Government Authorized Customers

1. The PV shall provide distribution and supply management services for medical/surgical supplies and select medical equipment on the MSPV 2.0 Product

List to the awarded Contract Line Item Number(s)’s (CLIN) Authorized Customers specified in Attachment I. Authorized Customers may include: VAMCs and Other

Government Agencies (OGA) Facilities, in accordance with the terms and conditions set forth in this SOW and contract. During the term of the contract, VA reserves the right to add or delete VAMCs and OGAs to the list of government

Authorized Customers.

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2. OGAs may also be designated as government Authorized Customers under this contract. The facilities of a given OGA will be considered a separate CLIN(s) from

VAMCs aligned to VISNs. These CLINs will be independent of other VISNs that are aligned to VAMCs. As such, an OGA CLIN may overlap geographically with an existing VISN, but PVs will propose separately to service these areas. The same terms and conditions apply to OGAs as do apply to VAMCs except for any differences detailed in this document. OGAs may order medical/surgical supplies through MSPV 2.0, subject to execution of appropriate and legally-compliant

Interagency Agreements (IAA) as required by the agency, which OGAs will be responsible for initiating with VA. Identified below are the OGAs currently eligible to participate in the MSPV 2.0 Program. Any additional OGAs who, in the future, request to participate in the VHA MSPV 2.0 Program, will be added to Attachment

I.

a. Consolidated Mail Outpatient Pharmacy (CMOP)

i. VA provides approximately 80% of all outpatient prescriptions to

Veterans via mail order through CMOP, a system of seven highly automated pharmacies. CMOP processes 470,000 prescriptions daily.

b. Federal Bureau of Prisons (BOP)

i. BOP is organized into six regions: Mid-Atlantic, North Central, Northeast, South Central, Southeast, and Western Region. Each regional office provides oversight for each facility.

ii. Additional BOP requirements can be found in Appendix E: Federal

Bureau of Prisons (BOP) Security Requirements for Supply

Delivery.

c. Health & Human Services (HHS)

i. HHS operates a Supply Services Center in Perry Point, Maryland, that supports the sourcing of pharmaceutical, medical, and dental supplies to federal civilian agencies.

d. Indian Health Services (IHS)

i. IHS National Supply Service Center (NSSC) located in Oklahoma

City, Oklahoma, services IHS, Tribal, and Urban (I/T/U) facilities nationwide. The NSSC coordinates and manages the purchase and distribution of pharmaceuticals, medical, and other health care related supplies. Accordingly, NSSC serves as the IHS Supply

SOW – MSPV 2.0 Page 8 of 72 management, operation, and distributor of emergency and pandemic supplies. Reference public law (P.L.) 93-638.

ii. IHS is not subject to the ordering processes outlined in Section III.A

Contract/Delivery Orders (and others) related to Electronic Data

Interchange (EDI) capabilities. IHS facilities are not currently capable of employing EDI transactions and will instead opt for a send-for-review process to place orders with the relevant PV.

Type of Contract

1. This SOW will result in award of multiple individual Indefinite Delivery, Indefinite

Quantity (IDIQ) contracts to provide PV support, as defined in Section II.D PV

Support to each of the VISNs identified in Appendix C: VISN Map and Table herein.

a. PVs will propose distribution fees for each CLIN to provide PV distribution and supply management services. These distribution fees shall be flat fees to be assessed as a percentage of the supply price. Additional value-added services, such as Low Unit of Measure (LUM) and Saturday delivery, will adhere to this same fee structure, namely assessed as a fixed percent of the supply price.

i. Additional distribution fees, such as fees for additional services (on-site representatives, low-unit of measure, and stockless service, etc.)

will also be proposed by VISN and the same expectations apply.

Individual facilities will elect to have these other services and will pay a fee for the elected services based on their VISN’s spend.

2. The IDIQ contracts awarded under this SOW will be structured to include a 36-month base period, plus two 36-month option periods. This equates to a maximum potential contract length of nine years. An implementation period of 120-consecutive days will be included in the PoP.

MSPV Business Processes

Commercial Supplier Agreements for Medical Surgical Supplies

1. As part of the PV obligations outlined in this contract, the PV must have commercial agreements in place with all VA authorized suppliers for the MSPV 2.0

Product List supplies. Over the life of this agreement, suppliers and supply items will be added to and removed from the MSPV 2.0 Product List, as well as prices for supply items on the MSPV 2.0 Product List will be adjusted. Within 60-consecutive days of the respective supplier’s addition to the MSPV 2.0 Product List, PV’s commercial agreements must provide coverage for all suppliers who are contracted with the VA before program implementation.

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a. After contract implementation, new authorized suppliers will establish contracts with VA and be added to the MSPV 2.0 list of authorized suppliers to support facility needs. PVs will add these new authorized suppliers on a rolling basis. PVs will have 60-consecutive days from the release of an updated MSPV 2.0 Product List to establish commercial agreements with new authorized suppliers and begin accepting orders for new supplies.

2. Commercial agreements established by PVs with VA authorized suppliers pursuant to Section II.A Commercial Supplier Agreements for Medical Surgical Supplies, above, shall provide, at a minimum, that any and all medical/surgical supplies delivered to an Authorized Customer under this SOW shall at all times: (1) have current a Food and Drug Administration (FDA) premarket approval as required by

FDA under Part 814 title 21, Code of Federal Regulations, or any successor regulation; (2) be compliant with Global Standard 1 (GS1), Health Industry

Business Communications Council (HIBCC), and/or International Society for

Blood Transfusion (ISBT) 128 standards; (3) be compliant with either the Buy

American Act (BAA) IAW 41 U.S.C. Chapter 83 or Trade Agreement Act (TAA)

IAW 19 U.S.C. 2501 as determined by inclusion on the MSPV Product List; (4) have sufficient shelf life remaining to satisfy the requirements of 0, herein.

Commercial agreements shall also contain appropriate flow downs of standard

Federal Acquisition Regulation (FAR) and VA Acquisition Regulation (VAAR) clauses contained in the PV’s contract, as required by implementing FAR regulation; and (5) be required to notify the VA if the PV learns that compliance with any of the aforementioned conditions has lapsed.

3. In situations where the PV cannot form a commercial agreement, the PV must within two consecutive days after knowing the commercial agreement cannot be formed provide to the Government a written report detailing those authorized suppliers that are not under commercial agreement. At a minimum, the report should identify the VA contract number, the authorized supplier name, and a detailed explanation as to why the PV does not have an arrangement with the authorized supplier. This report must be sent to the SAC and Healthcare

Commodities Program Office (HCPO) and a contingency plan needs to be developed.

4. The PV is required to provide a monthly report to the SAC and HCPO detailing the list of authorized suppliers with whom PVs have been able and unable to establish a commercial agreement. If after 60-consecutive days from the release of an updated

MSPV 2.0 Product List, the PV cannot establish a commercial agreement with a

VA authorized suppliers as required by Section II.A Commercial Supplier

Agreements for Medical Surgical Supplies above, the PV must within two consecutive days after knowing the commercial agreement cannot be formed provide to the Government a written report detailing those specific suppliers that are not under commercial agreement. At a minimum, the report should identify the

VA contract number, the authorized supplier name, date agreement entered or a

SOW – MSPV 2.0 Page 10 of 72 detailed explanation as to why the PV does not have an arrangement with the authorized supplier, whichever is applicable.

5. It is the intention of VA to avoid passthrough arrangements between PVs and VA authorized suppliers. To that end, it is not required that VA authorized suppliers take physical possession of supplies provided to PVs. However, authorized resellers must, at minimum, comply with the requirements of 13 CFR 121.406(b) prior to the

PVs selling the supplies to the Government.

6. VA reserves the right to remove any supply from the MSPV 2.0 Product List.

a. If a supply is removed from the MSPV 2.0 Product List, the PV may continue for up to 90-consecutive days from the date of removal to distribute to

Authorized Customers any units of that supply already in stock. These sales must be at the contract price in the MSPV 2.0 Product List at time of removal.

7. The PV shall not require more than $10 million of product liability coverage per commercial supply contract holder. The PV shall not require the commercial supply contract holder to meet any additional insurance term or condition without first obtaining the permission of the SAC and the administering CO.

8. The commercial agreements prescribed in this section are solely between the PV and VA authorized suppliers, and do not involve the Government as a party.

Prime Vendor Order Number (PVON) for New PVs

1. Within 90-consecutive days of any contract award under this SOW, the PV shall have its Information Technology representative responsible for assigning the PVON contact the Authorized Customer Contracting Officer’s Representative (COR) to arrange training and to obtain a sample file with information relevant to a specific company’s PVON. The format of PVONs assigned is at the discretion of the PV but shall not contain any special characters (e.g., asterisk, ampersand, etc.), but PVONs may include dashes. The PV will be responsible for accessing the MSPV 2.0

Product List posted by VA and populating the catalog with the PVONs. The PVON assigned shall be provided to VA simultaneously when the Authorized Customer is notified of the PVON. PVONs are not required to be established until there is demand from at least one Authorized Customer for a supply.

Supply Classification

1. Core List: Utilizing the PV’s Catalog (developed based on the MSPV 2.0 Product

List of supplies) each facility will develop a Core List. The Core List will consist of supplies that a given facility estimates it will order at least one Unit of Measure

(UOM) or one LUM of that supply in a 30-consecutive day period, for two consecutive periods. For example, a supply order for one UOM (or LUM) on July

17th and another on August 13th makes the item eligible for a Core designation.

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However, if there is not another order on or prior to September 12th, the item will no longer be eligible as Core. UOM is defined as the quantity available for conventional/bulk delivery on the MSPV 2.0 Product List. LUM is defined as any

UOM less than the quantity available for conventional/bulk delivery on the MSPV

2.0 Product List. The PV will be responsible for providing recommendations for the addition and removal of Core and Non-Core designated items. Final authority on designating supplies as Core or Non-Core List rests with each facility.

a. The PV shall consolidate usage for authorized customers ordering from the same distribution center such that, if any single or combination of authorized customers' orders an item within a 30-consecutive day period, for two periods, the item should be retained on the PVs catalog and continue to be stocked in the specific distribution center. The determination of whether an item remains as Core should take into consideration all authorized customers buying the item regardless of Core or Non-Core orders. In other words, if several authorized customers, who order from the same distribution center, order the same Non-Core item within a 30-consecutive day period, for two consecutive periods, the PV should stock this item within the distribution center to provide an increased availability for the authorized customers. The PV shall provide a monthly list to affected facilities that identifies items that are Non-Core but are being stocked by a distribution center and available for delivery through the PV along with facility Core items.

2. Non-Core List: Utilizing the PV’s Catalog (developed based on MSPV 2.0 Product

List supplies), the PV and the facility will determine that any supply not ordered at least once in a 30-consecutive day period is a Non-Core List supply. This list should include all supplies available through the PV excluding those supplies already identified as Core List supplies.

a. As above, the PV and the facility are expected to work together to monitor supply data to determine the appropriate list for a given supply.

b. The PV shall consolidate usage for authorized customers ordering from the same distribution center such that, if any single or combination of authorized customers' orders an item within a 30-consecutive day period, for two periods, the item should be stocked in the specific distribution center. The determination of whether an item is stocked should take into consideration all authorized customers buying the item regardless of Core or Non-Core orders.

In other words, if several authorized customers, who order from the same distribution center, order the same Non-Core item within a 30-consecutive day period, for two consecutive periods, the PV should stock this item within the distribution center to provide an increased availability for the authorized customers. The PV shall provide a monthly list to affected facilities that identifies items that are Non-Core but are being stocked by a distribution center and available for delivery through the PV along with facility Core items. These consolidated items are a PV responsibility.

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3. PVs are required to track customer order history, even if the supplies are below the required frequency for Core List classification. PV tracking of actual customer ordering patterns must be used to estimate customer demand velocity for Non-core

List supplies to include seasonal ordering trends. This data shall be reported to the customer monthly. Further details are outlined in Appendix D: Performance

Requirements Summary.

a. This data is expected to be highly tentative in nature during implementation through the first six months of performance, but this data should be shared with Authorized Customers during performance reviews. Subsequently, the

PV is required to utilize order history and inventory projections to perform at or above the contractually rate of fill needed for Non-core List.

4. Different classifications of supplies have different fill rate requirements as detailed in Section IV.S Metrics

PV Support

1. PVs will propose for VISNs to which they wish to provide distribution services.

Upon contract award, VISNs may be organized into regions that are served by a particular PV.

a. PV backorder protocol: The PV must support all required electronic transactions. The customer places its order with the PV. Any supplies not filled in the next scheduled delivery shall be held on backorder. For backordered supplies, the PV shall contact the customer within 48 hours of original order to provide an estimated ship date (ESD). The customer shall then determine if this ESD is acceptable or cancel the order. PVs may not cancel backordered supplies without customer approval.

b. The Financial Services Center (FSC) will track PV adherence to ESDs through EDI transaction data. The rate at which PVs honor their ESDs will be part of the PV’s performance reviews throughout the life of the contract.

2. PVs will have the option to propose for VISNs to which they wish to serve as an

Alternate PV to provide distribution services. The Government will award one

Primary PV per VISN and intends to award one Alternate PV per VISN to achieve the greatest efficiencies and ensure continuity of service. Should the contract for a

Primary PV for a VISN be terminated, the Alternate PV shall assume the responsibilities of the Primary PV for that VISN as required. Any Alternate PV will be put into effect only by written authorization via Modification to the Contract from the CO. Only contractors receiving Primary PV awards are eligible to serve as an Alternate PV.

a. In the event of non-performance on the part of a Primary PV, the Alternate PV may be called upon at any time to provide support for the non-performing

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Primary PV’s VISN. Upon written authorization via modification to the contract from the CO, the implementation period for the Alternate PV and the authorized customer will begin. The implementation period for the Alternate

PV will be 60 days. No later than 60 days from written authorization via modification to the contract from the CO, the Alternate PV is required to be ready to accept and execute customer orders.

b. Alternate PV performance will be assessed against the same contract requirements as the Primary PV Performance. Alternate PV performance will begin 60 days after written authorization via modification to the contract from

CO.

Issue Resolution

1. Should issues arise during the execution of this contract that prevent a PV from executing contractual requirements due to lack of necessary data, approval or other required inputs from the Authorized Customer, PVs shall follow the following hierarchy for escalation and issue resolution:

a. Local facility COR

b. VISN COR

c. HCPO and SAC CO

2. A warranted Contracting Officer is the only person authorized to obligate the government during the execution of the contract.

VA Ordering Procedures

Contract/Delivery Orders

1. Order Methods: Participating facilities will normally generate orders in Integrated

Funds Distribution Control Point Activity Accounting and Procurement (IFCAP), which will be processed through the EDI as the required transmission method. Only in the event of emergencies or system failures will the PV also accept all types of delivery orders and order modifications via fax, telephone, and the contractor’s web portal. There shall be no limit on the number of orders placed by facilities in a day, but the PV shall be responsible for consolidating the orders for a single delivery on the next scheduled delivery date. If the VA implements a new electronic inventory and ordering system, the PV shall have the technical capability to work with the VA to adapt to any new system specifications required to accept electronic orders from the VA.

a. An Authorized Customer may place orders that are emergency or routine

(next business day delivery). The PV must designate a central location for

Authorized Customer orders to be sent. The PV will determine the appropriate distribution center or method to fulfill the order within the designated region.

The PV is required to have the capability to receive, manage, and fulfill

SOW – MSPV 2.0 Page 14 of 72 manual orders in instances where there are power outages, security breaches or other electronic systems issues.

b. An Authorized Customer may request the PV to setup a delivery location in their system for an Authorized Customer that is in the PV’s global geographical region. Upon contract modification, the PV shall set up the delivery location within five business days upon receipt of the request.

2. Minimum Purchase Order Amount: The minimum purchase order (PO) amount is the minimum dollar value for a unique PO that PVs are willing to accept to distribute supplies according to the terms of this contract. Offers shall include a minimum purchase order amount in their technical volume/proposal and the minimum PO will be established in the PV contract upon award.

3. Order Cut-off Time: Orders shall be accepted by the PV between the hours of 8:00

AM and 5:00 PM facility local time. Any order received by the PV prior to 1:00 PM facility local time is subject to next scheduled delivery day lead time. Orders received at the PV after 1:00 PM facility local time are subject to the following scheduled delivery day lead time.

4. EDI Order Confirmation: The PV shall generate EDI order confirmation (EDI

855) to the FSC within two hours after receipt of EDI orders. This EDI transmission will include a confirmation or rejection for each line item on the original order. The

PVs may continue to use a Value-Added Network (VAN) for EDI transmission. If they do not have a VAN in place, the PV shall be required to sign a Business

Association Agreement to bypass the VAN and communicate directly with the VA.

VA also requires an Interconnection Security Agreement Memorandum of

Understanding (ISA/MOU) to establish a direct connection with a vendor.

a. EDI Order Confirmation Report: The PV shall provide a monthly report to

FSC and the Healthcare Commodities Program Office (HCPO). Further details and requirements outlined in Appendix D: Performance Requirements

Summary.

5. Confirmation on Orders other than EDI: Confirmation to ordering facilities for facsimile orders and orders via any web portal shall be sent within two hours of receipt of order via email. Telephone orders shall be confirmed by phone or email within 30 minutes.

6. Confirmation Content on Orders other than EDI: All filled, unfilled, or partially filled purchase order line supplies for the medical/surgical supplies shall be listed on the order. A single order confirmation shall be provided, which includes Core

List and Non-core List supplies. This order confirmation applies to non-EDI orders.

EDI confirmation requirements are outlined in Section III.A.9 below. Facilities shall be able to print the confirmation. At a minimum, the order confirmation shall include the following information:

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• PV(s) Name

• PV(s) Contract Number

• Facility Name

• Facility Purchase Order Number

• Reason for Rejection

• Vendor Part Number

• Manufacturer’s Part Number

• Supply Description

• Core List or Non-core List Classification

• Unit of Purchase

• Packaging Multiple

• Quantity Ordered

• Quantity Confirmed

• Status of Non-Confirmed Line Item(s)/Quantities

• Note for Pre-Approved Supply Substitution (Yes/No)

• Line Item Unit of Purchase Price

• Line Item Total Cost

• Total Cost of Order

• Identification of Cancelled Medical/Surgical Supplies

7. Required PV Operating Hours: The PV must accept orders between the hours of

8:00 AM and 5:00 PM, facility local time, Monday through Friday, excluding federal holidays, unless otherwise agreed to by the PV and the ordering facility under contract within the region. Orders received at the PV prior to 1:00 PM facility local time are subject to next scheduled delivery day lead time. Orders received at the PV after 1:00 PM facility local time are subject to the following scheduled delivery day lead time. The PV must provide a toll-free access number and email address for the facility to use when contacting the PV’s customer service representative, if outside the local calling area. A phone number for 24-hour service must be provided to support emergency orders.

8. Ordering Procedure: The preferred method for Authorized Customers to place orders will be via EDI, however, an ordering facility that experiences a problem with its EDI is authorized to place telephone and/or facsimile orders until its electronic ordering system is functional.

9. Order Confirmations: At a minimum, the EDI order confirmation will include product number ordered, quantity ordered, unit of issue, delivered unit price, delivery order number, and the American National Standards Institute (ANSI)

Reject/Status Codes applicable to the ordered line item. For a complete listing of

EDI order confirmation information requirements, refer to Section IV.B Core List

Creation and Management. The PV shall have the means to screen and reject duplicate orders.

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a. The order confirmation must be in identical sequence to the delivery order placed by the ordering facility. The confirmation shall be communicated via

EDI. Furthermore, all unfilled or partially filled line items shall be listed on the confirmation request. For the delivered unit price of each supply, the packing list price must be identical to the confirmation price.

b. For non-drop ship supplies, the customer can initiate a cancellation request at any time up to delivery shipment to the facility.

i. PVs cannot refuse a cancellation request when providing distribution and supply management services to an Authorized

Customer.

c. Drop-ship supplies can be cancelled before the item has been shipped without a restocking fee.

i. An Authorized Customer may cancel an order after shipping but prior to delivery, however, a restock fee will apply if packaging is uncompromised.

10. Delivery: The PV shall package each order for delivery to the Authorized Customer delivery point(s) as required by the Authorized Customer(s). The PV shall send an advance shipment notice, to the ordering facility. An ANSI X12 (EDI 856)

“Advance Shipment Notice” shall be generated prior to shipment, and prior to being offered for delivery and must match order confirmations sent to the ordering officer.

For non-EDI orders, an email that contains shipment notice of the order, and any other relevant information is acceptable. The PV is required to segregate the

Authorized Customer’s orders by delivery order/call number, and by ordering site within the Authorized Customer. Multiple delivery orders/calls can be placed on a single pallet if the delivery orders/calls remain segregated. The PV shall comply with the carrier’s requirements involving shipment via air.

a. Routine delivery for Authorized Customers, including Hawaii and Alaska:

i. Deliver all Core List orders for non-emergency delivery supplies by the close of each facility’s delivery window the next scheduled delivery day. Preferred delivery hours are outlined in Attachment I:

VAMC and OGA Facilities. The times the facility has listed as their preferred window is the time the PV is required to delivery by.

Specific delivery hours will be established between the PV and the facility.

ii. All orders received by 1:00 PM, facility local time, must be delivered by close of the next scheduled delivery day within the facility’s delivery window except as noted above (i.e., federal holidays and weekends or if the PV and the facility establish a different delivery arrangement based on facility preference).

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iii. Delivery of Core List medical/surgical supplies: The PV shall bundle supplies as appropriate for delivery and provide one invoice per shipment by the required delivery date for all recurring medical/surgical supplies as specified by the facility. If supplies are not able to be shipped simultaneously, partial shipments may be utilized. Shipments to a facility for medical/surgical supplies not located at the PV’s primary distribution center servicing the customer shall be delivered with the regularly scheduled consolidated delivery for the facility. Facilities may reject any split shipments for Core List medical/surgical supplies. Approved split shipments for Core List medical/surgical supplies to facilities shall count against the unadjusted fill-rate.

iv. Delivery of Non-core List medical/surgical supplies: The delivery time (i.e. the number of days after receipt of order) for Non-core List medical/surgical supplies shall be determined through agreement between the PV(s) and the Authorized Customer.

11. System Changes: If there are "system changes", classified as any changes or adjustments made to the previous business process, including, but not limited to, the method of ordering or sharing of data via this MSPV program, the PV is required to inform the authorized customer, HCPO, FSC, and SAC of the changes 90-consecutive days before any changes take place. The PV will be responsible for explaining to the authorized customer, HCPO, FSC, and SAC the impact the

“system changes” will have on the ordering process and what processes are likely to be affected. In addition, the PV must notify the authorized customer, HCPO, FSC, and SAC 30-consecutive days prior to the planned “system change” of the planned cutover. The OSR will be provided any additional training and relevant materials no later than 30-consecutive days prior to the planned “system change”. The PV must also be prepared to answer any questions regarding the “system changes” before and while any “system changes” are implemented. Any system changes must remain compatible with VA systems and enable PVs to provide continuous support under the contract.

Emergency Orders for Core and Non-Core List Supplies

1. An emergency is defined as any event or situation which would prevent the

Authorized Customer from fulfilling its mission.

2. Emergency supplies are supplies requiring expedited delivery due to a specific need designated by the ordering facility which threatens the loss of life, limb, or eye-sight or impedes the ability to perform time-sensitive medical procedures. The designation of emergency order must be made at the time of order placement unless a threat concerning the loss of life, limb, or eye-sight occurs during the delivery timeframe provided by the vendor, and at that time, the emergency order

SOW – MSPV 2.0 Page 18 of 72 requirements will apply. The PV must provide each ordering facility with emergency order and delivery service 24-hours per day, seven days per week, including holidays. Emergency orders, whether for Core or Non-core List, are subject to all requirements stated herein if the supply is executable under the PV

Program.

a. The PV shall provide up to three emergency orders per facility per month at no additional charge to the facility.

b. Emergency order placement shall be created by the authorized customer, and the authorized customer will contact the PV representative via telephone number and/or pager number to confirm order placement. Emergency orders must be confirmed by the PV via phone within 30 minutes of order placement, whether Core or Non-core List orders. The authorized customer will provide a follow-up e-mail confirmation to the PV representative after verbal confirmation has occurred.

c. The PV must provide each ordering facility with the telephone number and/or pager number of the PV’s representative responsible for providing this service.

3. Continuous Supply Support during Catastrophes: The PVs shall maintain support for all Authorized Customers in a broad geographic area during catastrophes by adjusting their distribution system or capabilities to draw support from outside the geographic area. Historic examples demonstrating this need include Hurricanes Andrew, Katrina and Sandy and the Northridge and San

Francisco Bay area earthquakes. The PVs shall create and provide contingency continuity of service plans for each supported facility and geographical area as designated by Contract Line Item Number(s) (CLIN). Such plans must be in place by end of the implementation period. VISN Chief Supply Chain Officers (CSCOs) will then review and approve. This plan shall specifically address de-conflicting orders for supplies and formal cooperation agreements to ensure adequate support to VHA facilities across MSPV support areas. All plans shall be jointly updated, reviewed and accepted by the MSPV and relevant VISN CSCOs annually. The

VHA HCPO will be notified should unresolvable issues prevent plan agreement.

Acceptable performance is defined greater than or equal to 99% of all CO negotiated MSPV required services continuously available as required throughout the contingency/disaster response period.

4. Required PV Operating Hours: Accept receipt of emergency orders 24-hours a day, seven days per week, including holidays. There must be direct access to a PV representative, through a phone or rapid-response paging system.

5. Ordering Options: In the event of emergencies, the PV will accept all types of delivery orders and order modifications via fax, telephone, and the contractor’s web portal. Emergency orders can be placed directly with the PV representative. For additional requirements see Section III.A.1 Ordering Methods.

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6. Order Confirmation: The authorized customer will contact the PV representative via telephone number and/or pager number to confirm order placement. Emergency orders must be confirmed by the PV via phone within 30 minutes of order placement, whether Core or Non-core List orders. The authorized customer will provide a follow-up e-mail confirmation to the PV representative after verbal confirmation has occurred. For additional requirements regarding confirmations, see Section III.A.9 Order Confirmations.

7. Delivery:

a. For All Authorized Customers: Emergency orders of Core List supplies must be delivered within 12-hours of the order being placed. The PV and the ordering facility shall negotiate the delivery of Non-core List supply emergency orders at time of order placement.

b. Emergency orders may be delivered as separate shipments and are not required to be delivered with non-emergency orders. Each PV must offer (on the Pricing Sheet) a flat-rate transportation and handling cost that will be charged for each additional emergency shipment.

c. A PV shall indicate the number of emergency deliveries offered at no additional charge beyond the three required by this contract, and the PV shall specify any additional charges (if applicable) per delivery trip, for emergency orders which exceed the three per month shipment limitation. Additional emergency order delivery charges more than the three no-charge deliveries shall be charged at a flat rate per delivery trip. Drop shipments are authorized for emergency deliveries.

Work Requirements for Prime Vendors

Contract Phase-in/out

1. To ensure enough administrative time has been allowed for continuity of medical/surgical supplies and services at required quality levels as well as anticipated inventory levels for each facility covered by the contract, the PV shall begin accepting orders and delivering medical/surgical supplies for all facilities under this contract immediately following the 120-consecutive day implementation period. The contract PoP shall begin simultaneously with the start of the 120-consecutive day implementation period.

2. The PV shall perform the following functions during the implementation period: A draft transition plan shall be provided by the PV to the VHA HCPO and the CO as part of the offer. A final and fully developed transition plan shall be provided by the

PV to the VHA HCPO and the CO within 30-consecutive days of contract award.

Both the draft and final transition plans should include the following:

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a. Assist facilities with the identification of facility Core and Non-core List medical/surgical supplies and gather supply demand data from each individual facility that is being served by the PV. Specific to the implementation period, the PV shall provide the report detailed in Section IV.E.1. Core List Supply

Report at two intervals; 60-consecutive days and 120-consecutive days from the start of the implementation period.

b. The PV shall negotiate commercial agreements with VA-contracted authorized suppliers in accordance with Section II.A Commercial Supplier

Agreements for Medical Surgical Supplies. Specific to the implementation period, the PV shall provide the report detailed in Section II.A.3. at two intervals; 60-consecutive days and 120-consecutive days from the start of the implementation period.

c. By the end of the implementation period, PVs must be ready to deliver all supplies from the initial release of the MSPV 2.0 Product List that have been identified as Core List supplies by the PV’s Authorized Customers.

d. In situations where the PV cannot form a commercial agreement, the PV must within two consecutive days after knowing the commercial agreement cannot be formed provide to the Government a written report detailing those authorized suppliers that are not under commercial agreement. At a minimum, the report should identify the VA contract number, the authorized supplier name, and a detailed explanation as to why the PV does not have an arrangement with the authorized supplier. This report must be sent to the SAC and HCPO and a contingency plan needs to be developed.

e. The PV is required to provide a monthly report to the SAC and HCPO detailing the list of authorized suppliers with whom PVs have been able and unable to establish a commercial agreement. If after 60-consecutive days from the release of an updated MSPV 2.0 Product List, the PV cannot establish a commercial agreement with a VA authorized suppliers as required by Section

II.A Commercial Supplier Agreements for Medical Surgical Supplies above, the PV must within two consecutive days after knowing the commercial agreement cannot be formed provide to the Government a written report detailing those specific suppliers that are not under commercial agreement. At a minimum, the report should identify the VA contract number, the authorized supplier name, date agreement entered or a detailed explanation as to why the

PV does not have an arrangement with the authorized supplier, whichever is applicable.

f. Set-up facilities with any value-added services requested by facilities (See

Section VI.C Full-Time, On-Site Customer Service Representative).

Performance of value-added services will begin once the PoP has commenced.

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3. Throughout the contract PoP, VA will release updates to the MSPV 2.0 Product List every 30-consecutive days, or more often if updates are available. PVs are required to form commercial agreements with any new authorized suppliers within 60-consecutive days. After commercial agreements are formed, PVs will have an additional 60-consecutive days to stock supplies for delivery to Authorized

Customers.

4. The selected PV shall participate in post award briefings and trainings with end-use customers as scheduled by the Government. At least one post award briefing and train the trainer session will be held for each geographical area, as designated by

CLIN prior to implementation. These trainings will occur three to six months after contract award.

5. At least 60-consecutive days, before contract expiration, the outgoing PV shall assist the newly awarded PV(s), the geographical area, as designated by CLIN, and facility CORs with functions necessary for a smooth transition into the new contract. This 60-consecutive day period is included in the contract PoP.

a. The outgoing PV(s) shall provide a detailed final report on each individual facility on contract to HCPO. For each facility, the report shall provide the following:

i. Full 12-month usage data, volume commitment, and historical record for both Core List and Non-core List medical/surgical supplies.

ii. Full 12-month spend by facility broken out by month with an additional option for VISN-level data.

iii. Lessons-learned from serving the respective facility and relevant

VISN.

iv. Supply substitution list determined by facility or designee (not the vendor) in a common commercial format (Microsoft Excel is an example of a common commercial format). This list must always be created by the facility and should be agnostic and therefore not exclusively supplies self-manufactured by the PV.

b. The outgoing PV(s) shall provide a final reconciliation report to each facility and HCPO within 30-consecutive days from the contract expiration date. Any pending credits and rebills shall be resolved within 30-consecutive days from contract expiration date. This report shall include the following:

i. All stock out reports or shipment errors that occurred during the service with the outgoing PV.

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ii. The Core List and the changes that may have occurred to it over the last six months.

c. Buy-out requests will only be accepted for unique medical/surgical supplies stocked by the PV(s) solely to meet a particular VHA facility’s requirement and will be limited to 15 calendar days’ worth of inventory. In addition, these requests will only be accepted when the PV(s) has provided documented evidence that they have tried for at least 30 calendar days to dispose of the stock via other means that result in no charge to the facility.

i. If PVs are terminated for cause, no inventory buy-out will be offered. To be eligible for this inventory reduction, PVs must be compliant with all other requirements laid out in this contract.

Core List Creation and Management

1. Establishing Core List

a. The VA will provide demand data for each facility from the past 12 months to the PV. With that data, the PV will work with the facilities to establish a Core

List and the remaining supplies will be designated as Non-core List. Facility

Core List finalization is contingent upon approval from the respective facility.

b. PVs shall…