36C24419R0102-002.docx

36C24419R0102

PAGE 1 OF

1. REQUISITION NO.

2. CONTRACT NO.

3. AWARD/EFFECTIVE DATE

4. ORDER NO.

5. SOLICITATION NUMBER

6. SOLICITATION ISSUE DATE

a. NAME

b. TELEPHONE NO. (No Collect Calls)

8. OFFER DUE DATE/LOCAL

TIME

9. ISSUED BY

CODE

10. THIS ACQUISITION IS

UNRESTRICTED OR

SET ASIDE:

% FOR:

SMALL BUSINESS

HUBZONE SMALL

BUSINESS

SERVICE-DISABLED

VETERAN-OWNED

SMALL BUSINESS

WOMEN-OWNED SMALL BUSINESS

(WOSB) ELIGIBLE UNDER THE WOMEN-OWNED

SMALL BUSINESS PROGRAM

EDWOSB

8(A)

NAICS:

SIZE STANDARD:

11. DELIVERY FOR FOB DESTINA-

TION UNLESS BLOCK IS

MARKED

SEE SCHEDULE

12. DISCOUNT TERMS

13a. THIS CONTRACT IS A

RATED ORDER UNDER

DPAS (15 CFR 700)

13b. RATING

14. METHOD OF SOLICITATION

RFQ

IFB

RFP

15. DELIVER TO

CODE

16. ADMINISTERED BY

CODE

17a. CONTRACTOR/OFFEROR

CODE

FACILITY CODE

18a. PAYMENT WILL BE MADE BY

CODE

TELEPHONE NO.

DUNS:

DUNS+4:

PHONE:

FAX:

17b. CHECK IF REMITTANCE IS DIFFERENT AND PUT SUCH ADDRESS IN OFFER 18b. SUBMIT INVOICES TO ADDRESS SHOWN IN BLOCK 18a UNLESS BLOCK BELOW IS CHECKED

SEE ADDENDUM

19.

20.

21.

22.

23.

24.

ITEM NO.

SCHEDULE OF SUPPLIES/SERVICES

QUANTITY

UNIT

UNIT PRICE

AMOUNT

(Use Reverse and/or Attach Additional Sheets as Necessary)

25. ACCOUNTING AND APPROPRIATION DATA

26. TOTAL AWARD AMOUNT (For Govt. Use Only) 27a. SOLICITATION INCORPORATES BY REFERENCE FAR 52.212-1, 52.212-4. FAR 52.212-3 AND 52.212-5 ARE ATTACHED. ADDENDA

ARE

ARE NOT ATTACHED.

27b. CONTRACT/PURCHASE ORDER INCORPORATES BY REFERENCE FAR 52.212-4. FAR 52.212-5 IS ATTACHED. ADDENDA

ARE

ARE NOT ATTACHED

28. CONTRACTOR IS REQUIRED TO SIGN THIS DOCUMENT AND RETURN _______________

29. AWARD OF CONTRACT: REF. ___________________________________ OFFER

COPIES TO ISSUING OFFICE. CONTRACTOR AGREES TO FURNISH AND

DATED ________________________________. YOUR OFFER ON SOLICITATION

DELIVER ALL ITEMS SET FORTH OR OTHERWISE IDENTIFIED ABOVE AND ON ANY

(BLOCK 5), INCLUDING ANY ADDITIONS OR CHANGES WHICH ARE

ADDITIONAL SHEETS SUBJECT TO THE TERMS AND CONDITIONS SPECIFIED

SET FORTH HEREIN IS ACCEPTED AS TO ITEMS:

30a. SIGNATURE OF OFFEROR/CONTRACTOR 31a. UNITED STATES OF AMERICA (SIGNATURE OF CONTRACTING OFFICER) 30b. NAME AND TITLE OF SIGNER (TYPE OR PRINT) 30c. DATE SIGNED 31b. NAME OF CONTRACTING OFFICER (TYPE OR PRINT) 31c. DATE SIGNED

AUTHORIZED FOR LOCAL REPRODUCTION

(REV. 2/2012)

PREVIOUS EDITION IS NOT USABLE

Prescribed by GSA - FAR (48 CFR) 53.212

7. FOR SOLICITATION

INFORMATION CALL:

STANDARD FORM 1449

OFFEROR TO COMPLETE BLOCKS 12, 17, 23, 24, & 30

SOLICITATION/CONTRACT/ORDER FOR COMMERCIAL ITEMS

36C24419R0102 07-18-2019 Will Schlobohm,william.schlobohm2@va.gov 878 271 6639 08-19-2019

1600 HRS

00244 Department of Veterans Affairs Network Contracting Office 4

X X 339115 1000 Employees N/A X VISN 4(Refer to Perf. Work Statement

00244 Department of Veterans Affairs Network Contracting Office 4

Refer to VAAR: 852.232-72 (Electronic Submission of Payment Req) https://www.fsc.va.gov/einvoice.asp

(877) 353-9791

(512) 460-5429 See CONTINUATION Page This solicitation is for the furnishment of prescription eyeglass for veterans in VISN 4.

This procurement is being completed in accordance with FAR Part 15.

Award is intended to be a single Fixed-Price per Item Indefinite Delivery (ID): Requirements contract.

Four (4) year base period with four (4) one-year option periods to be exercised at the discretion of the Government.

Anticipated award effective date is 10/1/2019.

A continuation of the description of services can be found in section "B.

Performance Work Statement".

See CONTINUATION Page Determined at Task Order Level X Table of Contents

B.1 PERFORMANCE WORK STATEMENT………………………………………….5-14

See attached document: Attachment A - Estimated Annual QTY per facilities (for informational purposes only).

See attached document: Attachment B – Past Performance Questionnaire Example See attached document: Attachment C - Eyeglass QASP.

See attached document: Attachment D - Payment Methodology.

A.2 CONTRACT ADMINISTRATION DATA

1. Contract Administration: All contract administration matters will be handled by the following individuals:

a. CONTRACTOR:

b. GOVERNMENT: Contracting Officer 36C244 Department of Veterans Affairs Network Contracting Office 4

2. CONTRACTOR REMITTANCE ADDRESS: All payments by the Government to the contractor will be made in accordance with:

3. INVOICES: Invoices shall be submitted in arrears:

4. GOVERNMENT INVOICE ADDRESS: All Invoices from the contractor shall be submitted electronically in accordance with VAAR Clause 852.232-72 Electronic Submission of Payment Requests.

Refer to VAAR: 852.232-72 (Electronic Submission of Payment Req) https://www.fsc.va.gov/einvoice.asp

ACKNOWLEDGMENT OF AMENDMENTS: The offeror acknowledges receipt of amendments to the Solicitation numbered and dated as follows:

Page 1 of Page 1 of

SECTION B - CONTINUATION OF SF 1449 BLOCKS

B.1 Performance Work Statement (PWS) (A Continuation of 1449 Description of Services)

1.0 DESCRIPTION OF SERVICES

VISN 4 has an ongoing program to furnish eyeglasses to Veterans that require them and are eligible for assistance.

The eyeglass and related services are to be provided to the following facilities:

(460) Wilmington, DE (460GA) Georgetown, DE (Sussex County) (460GC) Dover, DE (Kent County) (460GD) Cape May, NJ (460HE) Northfield, NJ (Atlantic County) (460HG) Vineland, NJ (Cumberland County)

(503) Altoona, PA (James E. Van Zandt) (503GA) Johnstown, PA (503GB) DuBois, PA (503GC) State College, PA (503GD) Mapleton Depot, PA (Huntingdon County) (503GE) Indiana, PA

(529) Butler, PA (Duffy Road) (Abie Abraham) (529A4) Butler, PA (New Castle Road) (529GA) Hermitage, PA (Michael A. Marzano) (529GB) New Castle, PA (Lawrence County) (529GC) Kittanning, PA (Armstrong County) (529GD) Monroe Township, PA (Clarion County) (529GF) Cranberry Township, PA

(542) Coatesville, PA (542GA) Springfield, PA (542GE) Spring City, PA

(562) Erie, PA HCS (562GA) Meadville, PA (Crawford County) (562GB) Ashtabula, OH (562GC) Bradford, PA (McKean County) (562GD) Franklin, PA (Venango County) (562GE) Warren, PA

(595) Lebanon, PA (595GA) Camp Hill, PA (595GC) Lancaster, PA (595GD) Wyomissing, PA (Berks County) (595GE) York, PA (595GF) Pottsville, PA (Schuylkill County) (595QA) Annville, PA (Fort Indiantown Gap)

(642) Philadelphia, PA (Corporal Michael J. Crescenz) (642GA) Burlington County, NJ (642GC) Horsham, PA (Victor J. Saracini) (642GD) Gloucester County, NJ (642GF) Camden, NJ (642QA) Chestnut Street, PA (642QB) Fourth Street, PA

(646) Pittsburgh-University Drive, PA (646A4) Heinz, PA (H. John Heinz III) (646GA) St. Clairsville, OH (Belmont County) (646GB) Greensburg, PA (Westmoreland County) (646GD) Washington, PA (646GE) Uniontown, PA (Fayette County)

(693) Wilkes-Barre, PA (693B4) Allentown, PA (693GA) Sayre, PA (693GB) Williamsport, PA (693GC) Tobyhanna, PA (693GF) Berwick, PA (Columbia County) (693GG) Bangor, PA (Northampton County) (693QA) Honesdale, PA (Wayne County)

2.0 GENERAL REQUIREMENTS

2.1 Standards of Performance

Sample frame kits are to be new and will not be included in the inventory. The Contractor shall provide a wide selection of frames for the Veterans to choose from (frame line to be approved by the VA). The contractor shall fabricate the eyeglasses in strict conformance to the eyeglass prescription and verify final spectacles with the prescription. Verification of prescription and delivery to the beneficiary shall be documented and provided to the VA during each billing cycle (refer to Attachment D Payment Methodology). The contractor shall not add or substitute components or alter the beneficiary’s prescription in any way without prior approval and written authorization from the VA clinic Team or designee. All items provided by the contractor shall be new and be of current styles. The Items will be maintained in Optometry or Ophthalmology and discontinued style frames are not acceptable. VA prior to contract performance must approve frame selection. Any proposed substitutes for, or changes to, the approved frame selection shall be approved in writing by the COR and Contracting Officer. All frames must have a one-year warranty.

The Contractor shall designate an individual in his/her employment as “Contract Manager” who will be the primary point of contact (POC). The Contract Manager shall act as liaison to resolve day-to-day business arraignment and operational problems throughout the term of the contract. This individual shall be available to VA Medical Centers and Outpatient Clinics during normal business hours 8:00AM to 4:30PM (EST), Monday through Friday, excluding weekends and federal holidays.

3.0 SPECIFIC REQUIREMENTS

3.1 LENSES

All lenses shall be fabricated in strict conformance to the eyeglass prescription. All items provided by the contractor shall be new. All lenses shall be fabricated and provided in accordance with the standards set forth in the American National Standards Institute for Ophthalmic Lenses, ANSI Z80.1, 2010 or latest edition. All ophthalmic lenses shall be in accordance with Food and Drug Administration (FDA) Regulation, 21 CFR 801.410 for impact resistance, unless otherwise specified in the order by the ordering clinician. Glass ophthalmic lenses shall be chemically strengthened for impact resistance. All glass and plastic ophthalmic lenses shall be corrected curved lenses. Ophthalmic lenses with cylinder power of less than 1.5D or greater than 1.5D shall be fabricated in minus cylinder form, unless positive cylinder form is specified in the order. All lenses shall include UV coating, scratch resistance coating on all plastic lenses, balanced lenses, tint (when prescribed), roll & polish edge (when prescribed) as well as frames and cases (cushioned, open-end, pocket or clip-on) at no additional charge to the Government. It will be the patient’s preference as to which type of frames and cases they prefer.

Single Vision Lenses: Lenses shall be available in glass, plastic, polycarbonate. and high index plastic; when lens blanks are available. Construction of single vision lenses shall include spheres, Plano cylinders, and sphero-cylinders in all powers. Photochromatic lenses shall be available. Oversized blanks shall be available when needed. All lenses shall be placed in frames unless otherwise requested.

Bifocal Lenses: Lenses shall be available in glass, plastic or polycarbonate and high index plastic; when lens blanks are available. Construction of bifocal lenses shall include spheres, Plano cylinders, and sphero-cylinders in all powers with a range of +0.50 to + 4.50D which shall be available. Lenses shall be available in glass with flattop, and executive, polycarbonate with flattop segments. Photochromatic lenses shall be available. Oversized blanks shall be available when needed. All lenses shall be placed in frames unless otherwise requested.

Trifocal Lenses: Lenses shall be available in glass, plastic, or polycarbonate and high index plastic; when lens blanks are available. Construction of trifocal lenses shall include spheres, Plano cylinders, and sphero-cylinders in all powers. Add powers with a range of +1.50 to +4.50D, 50% intermediate power shall be available. Lenses shall be available in glass with flattop and executive segments. Photochromatic lenses shall be available. Oversized blanks shall be available when needed. All lenses shall be placed in frames unless otherwise requested.

Special Lenses: The Contractor shall provide special lens design in opaque, frosted or black, balanced lens, prismatic lens, cataract lens, polycarbonate, hi-index, over power, A/R coating, safety lenses, executive style, solid or gradient tinted (all colors) lenses, Photochromic lenses (Transitions or equivalent), aspheric lens, FL-41 tint, and slab-off prism. These requirements will be specified by the Government on the prescription or order. Updates shall be furnished upon publication.

Progressive Lenses: Lenses shall be available in glass, plastic, polycarbonate, and high index materials. Photochromatic lenses must also be available. Progressive lens style / layout shall be the same for all materials. Progressive style shall be considered “soft” in design. Construction of lenses shall include spheres, plano-cylinders, and sphero-cylinders in all powers. Add powers of +1.00 to +3.50 shall be available. Non-adaptable would be replaced by lined bifocals or trifocal at no charge to the VA. Oversized blanks shall be available when needed. All lenses shall be placed in frames unless otherwise requested.

3.2 FRAMES

All frames shall be provided in accordance with the “American National Standard Requirements for Ophthalmic Frames” ANSI Z80.5-2010 or latest version.

All items provided by the contractor shall be new. The Contractor shall provide completely assembled eyeglass frames placed in standard alignment and include mounting of lenses. All items provided by the contractor shall include fitting and adjustment services and a minimum of one-year warranty.

If the manufacturer discontinues a frame during the contract period, the contractor shall provide the VA with an approved substitute frame within 5 business days. All frames offered by the contractor shall be listed in either Frames/fax or frame catalogs and not be on any discontinued models. New free frame samples shall be provided with each contract renewal or if samples wear out or substitutions need to be made. When fulfilling prescriptions, the contractor shall provide completely assembled eyeglass frames placed in standard alignment and include mounting of lenses.

Privately owned frames may be submitted to the contractor for new lenses. Charges for lenses only shall be in accordance with the “B.2 Price Schedule”. Contractor is responsible for replacing like frames in the event of loss of privately-owned frames at no cost to the VA or beneficiary.

5.0 PERFORMANCE, DELIVERY, INSPECTION AND ACCEPTANCE

Contractor shall deliver items ordered under the forthcoming contract no later than seven business days after receipt of a delivery order (receipt of the delivery order will be done via SharePoint, a Veteran Affair’s electronic online portal), tracking of orders shall be available for one (1) year in advance. The contractor shall provide written notification to the COR and show cause in the event he is unable to deliver the required items in accordance with the Government's required delivery date.

If requested by COR, the Contractor shall be able to send monthly billing statements in a digital format i.e. Excel, .csv, or other digital format. These statements will be a billing summary of each eyeglass order invoiced and shipped during the prior business week. Required columns in weekly bill:

Invoice Date Invoice Number Billing amount Patient Name (Last Name, First Name Middle Site Identifier Purchase Order Number Lens Type In the event the Government requests expedited delivery, the ordering activity shall telephonically contact the contractor and inquire into the feasibility of obtaining this condition. The contractor shall respond within 24 hours to such request and expedited delivery shall be mutually agreed upon. Upon direction of VA, delivery of eyeglasses may be directly to the Prosthetics department or to the patient’s place of residence (at no extra charge to the Government for routine delivery to any of the above destinations). All deliveries should be sent by 1st class mail or any comparable means.

During the one-year warranty period the contractor shall make all necessary adjustments (i.e., material defects, distortions, etc). The contractor warrants/guarantees the eyeglasses against defective material and/or workmanship for a minimum of one year from the date of acceptance. Manufacturer’s warranties of eyeglass components that extend beyond the minimum one-year period shall be expressed and also enforced. The contractor agrees to furnish without additional cost to the government, all labor and materials necessary to correct defects that were detected during the guarantee period. Should the prescription be incorrectly filled, the contractor agrees to make corrections at no additional cost to the Government, all shipping cost will be covered by the contractor. These conditions do not apply to adjustments incidental to the wearing of eyeglasses, adjustments required by physical change of the wearer, or where there is evidence of deliberate misuse or alteration by anyone other than the contractor. If eyeglasses are returned to the contractor for correction of a problem due to contractor error, the corrected glasses shall be returned to VA facility within three (3) calendar days of receipt of the defective glasses. Contractor must have online portal capabilities for errors and issues to be easily recorded by each site.

The contractor shall immediately notify all affected VAMC(s), COR, and contracting activities in the event of a product recall, removal, required adjustment, required modification or substitutions that is suggested or mandated by the contractor, distributor, manufacturer, or any regulatory or official agency. The information that shall be included in this notification includes:

A complete item description, identification.

Administrative identification data including contract number, order numbers, and order date.

Reasons for recall, removal, adjustment, or modification.

Instructions for appropriate corrective action.

Contractor shall notify the VA within 24 hours if the manufacturer has a depletion of stock of a specific frame. The VA shall approve or disapprove all replacement frames.

6.0 QUALITY CONTROL AND PATIENT SATISFACTION:

6.1 Quality Control: The Contractor shall maintain a quality control plan that includes an ongoing review of manufactured products (timeliness and quality). Quarterly performance reports will be submitted to respective COR. Reports shall include:

Date of receipt of orders (or date orders delivered to/picked up by Optical Shop) VA error rates (errors submitted to the Contractor to be processed) Contractor error rates (errors submitted to VA or Veteran beneficiary) Accuracy of eyeglass fabrication (Spectacle Fabrication List) in accordance with ANSI Z80.1 and Z80.5 standards Number of eyeglasses returned due to fabrication error Average fabrication (Lab) process time Breakage/spoilage rate (specify frame, lens, etc.)

6.2 Patient Satisfaction: The Contractor shall send each patient a satisfaction survey in which they can score services from lowest to highest. Data shall be collected on a monthly basis, aggregated, and used for performance improvement, which are submitted to the respective facility COR on a quarterly basis. At a minimum, the surveys shall include:

Courteous and friendliness of staff Promptness of service Product choice Quality of product Timeliness of product delivery Fit and function of product Reason for returns The Government shall monitor the Contractor’s performance through monthly review of invoices for accuracy and timeliness, patient satisfaction and/or complaints received in Prosthetic and Sensory Aid Services (PSAS), and review of Contractor submitted performance improvement reports (quality assurance and patient satisfaction data). Performance monitoring will focus on, but not be limited to:

Equipment fabrication, repair and/or replace Number of remakes Number of eyeglass fabrication errors Number of prescription errors identified prior to product shipment Expedited delivery Accuracy of required documentation/reports submitted Number of patient complaints

6.3 SURVEY

On a quarterly basis, the Contractor will select 1% of random veterans who receive mailouts and verbally verify: Delivery of glasses, prescription accuracy, and quality of product.

The Contractor shall submit quality assurance and patient satisfaction performance improvement reports to the COR on a quarterly basis not later than the 15th day of the first month following the end of the quarter (i.e. January 15th, May 15th, July 15th, and October 15th).

B.2 PRICE/COST SCHEDULE (OFFEROR SHALL COMPLETE ALL PRICING FILLABLE INFORMATION BELOW)

(A CO may designate representatives and alternate representatives to place orders against this contract. Ordering officers (OOs) will be authorized to place orders against this contract. The Contracting Officer (CO) will furnish the Contractor with the names of individuals authorized as OOs, by separate memorandum upon issuance of the contract. When OOs are added after award, the CO will furnish the Contractor with the names of individuals authorized as OOs, by memorandum upon OO appointment. OOs are responsible for issuing and administering orders placed under this contract. OOs have no authority to modify any term of this basic contract. Any deviation from the terms of the basic contract must be approved in writing by the CO responsible for this contract. The Contractor shall accept orders against this contract only from the CO and/or authorized OOs. Fulfilling orders from persons other than the CO or OO may result in loss or delay in payment for supplies/services provided under such orders.)

Individual Unit Fixed Prices (11 items):

*Note 1 – Quantities below are estimates only. Actual usage will depend on actual need. The individual unit prices will be utilized for ordering each pair of glasses.

*Note 2 - Refer to Attachment D for Payment Methodology

Frames-Each (Individual unit price) EstimatedRegular (Dress) Frames- Total

ADD-ONS

Annual Total: $___________ Eight (8) Year Total (Annual Total x 8): $___________

Tentative Effective Date is 10/01/2019 Tentative Expiration Date is 10/30/2027

SECTION C - CONTRACT CLAUSES

C.1 IT CONTRACT SECURITY

VA INFORMATION AND INFORMATION SYSTEM SECURITY/PRIVACY

1. GENERAL

Contractors, contractor personnel, subcontractors, and subcontractor personnel shall be subject to the same Federal laws, regulations, standards, and VA Directives and Handbooks as VA and VA personnel regarding information and information system security.

2. ACCESS TO VA INFORMATION AND VA INFORMATION SYSTEMS

a. A contractor/subcontractor shall request logical (technical) or physical access to VA information and VA information systems for their employees, subcontractors, and affiliates only to the extent necessary to perform the services specified in the contract, agreement, or task order.

b. All contractors, subcontractors, and third-party servicers and associates working with VA information are subject to the same investigative requirements as those of VA appointees or employees who have access to the same types of information. The level and process of background security investigations for contractors must be in accordance with VA Directive and Handbook 0710, Personnel Suitability and Security Program. The Office for Operations, Security, and Preparedness is responsible for these policies and procedures.

c. Contract personnel who require access to national security programs must have a valid security clearance. National Industrial Security Program (NISP) was established by Executive Order 12829 to ensure that cleared U.S. defense industry contract personnel safeguard the classified information in their possession while performing work on contracts, programs, bids, or research and development efforts. The Department of Veterans Affairs does not have a Memorandum of Agreement with Defense Security Service (DSS). Verification of a Security Clearance must be processed through the Special Security Officer located in the Planning and National Security Service within the Office of Operations, Security, and Preparedness.

d. Custom software development and outsourced operations must be located in the U.S. to the maximum extent practical. If such services are proposed to be performed abroad and are not disallowed by other VA policy or mandates, the contractor/subcontractor must state where all non-U.S. services are provided and detail a security plan, deemed to be acceptable by VA, specifically to address mitigation of the resulting problems of communication, control, data protection, and so forth. Location within the U.S. may be an evaluation factor.

e. The contractor or subcontractor must notify the Contracting Officer immediately when an employee working on a VA system or with access to VA information is reassigned or leaves the contractor or subcontractor's employ. The Contracting Officer must also be notified immediately by the contractor or subcontractor prior to an unfriendly termination.

3. VA INFORMATION CUSTODIAL LANGUAGE

a. Information made available to the contractor or subcontractor by VA for the performance or administration of this contract or information developed by the contractor/subcontractor in performance or administration of the contract shall be used only for those purposes and shall not be used in any other way without the prior written agreement of the VA. This clause expressly limits the contractor/subcontractor's rights to use data as described in Rights in Data - General, FAR 52.227-14(d) (1).

b. VA information should not be co-mingled, if possible, with any other data on the contractors/subcontractor's information systems or media storage systems in order to ensure VA requirements related to data protection and media sanitization can be met. If co-mingling must be allowed to meet the requirements of the business need, the contractor must ensure that VA's information is returned to the VA or destroyed in accordance with VA's sanitization requirements. VA reserves the right to conduct on site inspections of contractor and subcontractor IT resources to ensure data security controls, separation of data and job duties, and destruction/media sanitization procedures are in compliance with VA directive requirements.

c. Prior to termination or completion of this contract, contractor/ subcontractor must not destroy information received from VA, or gathered/ created by the contractor in the course of performing this contract without prior written approval by the VA. Any data destruction done on behalf of VA by a contractor/subcontractor must be done in accordance with National Archives and Records Administration (NARA) requirements as outlined in VA Directive 6300, Records and Information Management and its Handbook 6300.1 Records Management Procedures, applicable VA Records Control Schedules, and VA Handbook 6500.1, Electronic Media Sanitization. Self-certification by the contractor that the data destruction requirements above have been met must be sent to the VA Contracting Officer within 30 days of termination of the contract.

d. The contractor/subcontractor must receive, gather, store, back up, maintain, use, disclose and dispose of VA information only in compliance with the terms of the contract and applicable Federal and VA information confidentiality and security laws, regulations and policies. If Federal or VA information confidentiality and security laws, regulations and policies become applicable to the VA information or information systems after execution of the contract, or if NIST issues or updates applicable FIPS or Special Publications (SP) after execution of this contract, the parties agree to negotiate in good faith to implement the information confidentiality and security laws, regulations and policies in this contract.

e. The contractor/subcontractor shall not make copies of VA information except as authorized and necessary to perform the terms of the agreement or to preserve electronic information stored on contractor/subcontractor electronic storage media for restoration in case any electronic equipment or data used by the contractor/subcontractor needs to be restored to an operating state. If copies are made for restoration purposes, after the restoration is complete, the copies must be appropriately destroyed.

f. If VA determines that the contractor has violated any of the information confidentiality, privacy, and security provisions of the contract, it shall be sufficient grounds for VA to withhold payment to the contractor or third party or terminate the contract for default or terminate for cause under Federal Acquisition Regulation (FAR) part 12.

g. If a VHA contract is terminated for cause, the associated BAA must also be terminated and appropriate actions taken in accordance with VHA Handbook 1600.01, Business Associate Agreements. Absent an agreement to use or disclose protected health information, there is no business associate relationship.

h. The contractor/subcontractor must store, transport, or transmit VA sensitive information in an encrypted form, using VA-approved encryption tools that are, at a minimum, FIPS 140-2 validated.

i. The contractor/subcontractor's firewall and Web services security controls, if applicable, shall meet or exceed VA's minimum requirements. VA Configuration Guidelines are available upon request.

j. Except for uses and disclosures of VA information authorized by this contract for performance of the contract, the contractor/subcontractor may use and disclose VA information only in two other situations: (i) in response to a qualifying order of a court of competent jurisdiction, or (ii) with VA's prior written approval. The contractor/subcontractor must refer all requests for, demands for production of, or inquiries about, VA information and information systems to the VA contracting officer for response.

k. Notwithstanding the provision above, the contractor/subcontractor shall not release VA records protected by Title 38 U.S.C. 5705, confidentiality of medical quality assurance records and/or Title 38 U.S.C. 7332, confidentiality of certain health records pertaining to drug addiction, sickle cell anemia, alcoholism or alcohol abuse, or infection with human immunodeficiency virus. If the contractor/subcontractor is in receipt of a court order or other requests for the above mentioned information, that contractor/subcontractor shall immediately refer such court orders or other requests to the VA contracting officer for response.

l. For service that involves the storage, generating, transmitting, or exchanging of VA sensitive information but does not require C&A or an MOU-ISA for system interconnection, the contractor/subcontractor must complete a Contractor Security Control Assessment (CSCA) on a yearly basis and provide it to the COR.

4. INFORMATION SYSTEM DESIGN AND DEVELOPMENT

a. Information systems that are designed or developed for or on behalf of VA at non-VA facilities shall comply with all VA directives developed in accordance with FISMA, HIPAA, NIST, and related VA security and privacy control requirements for Federal information systems. This includes standards for the protection of electronic PHI, outlined in 45 C.F.R. Part 164, Subpart C, information and system security categorization level designations in accordance with FIPS 199 and FIPS 200 with implementation of all baseline security controls commensurate with the FIPS 199 system security categorization (reference Appendix D of VA Handbook 6500, VA Information Security Program). During the development cycle a Privacy Impact Assessment (PIA) must be completed, provided to the COR, and approved by the VA Privacy Service in accordance with Directive 6507, VA Privacy Impact Assessment.

b. The contractor/subcontractor shall certify to the COR that applications are fully functional and operate correctly as intended on systems using the VA Federal Desktop Core Configuration (FDCC), and the common security configuration guidelines provided by NIST or the VA. This includes Internet Explorer 7 configured to operate on Windows XP and Vista (in Protected Mode on Vista) and future versions, as required.

c. The standard installation, operation, maintenance, updating, and patching of software shall not alter the configuration settings from the VA approved and FDCC configuration. Information technology staff must also use the Windows Installer Service for installation to the default "program files" directory and silently install and uninstall.

d. Applications designed for normal end users shall run in the standard user context without elevated system administration privileges.

e. The security controls must be designed, developed, approved by VA, and implemented in accordance with the provisions of VA security system development life cycle as outlined in NIST Special Publication 800-37, Guide for Applying the Risk Management Framework to Federal Information Systems, VA Handbook 6500, Information Security Program and VA Handbook 6500.5, Incorporating Security and Privacy in System Development Lifecycle.

f. The contractor/subcontractor is required to design, develop, or operate a System of Records Notice (SOR) on individuals to accomplish an agency function subject to the Privacy Act of 1974, (as amended), Public Law 93-579, December 31, 1974 (5 U.S.C. 552a) and applicable agency regulations. Violation of the Privacy Act may involve the imposition of criminal and civil penalties.

g. The contractor/subcontractor agrees to:

(1) Comply with the Privacy Act of 1974 (the Act) and the agency rules and regulations issued under the Act in the design, development, or operation of any system of records on individuals to accomplish an agency function when the contract specifically identifies:

(a) The Systems of Records (SOR); and

(b) The design, development, or operation work that the contractor/ subcontractor is to perform;

(1) Include the Privacy Act notification contained in this contract in every solicitation and resulting subcontract and in every subcontract awarded without a solicitation, when the work statement in the proposed subcontract requires the redesign, development, or operation of a SOR on individuals that is subject to the Privacy Act; and

(2) Include this Privacy Act clause, including this subparagraph (3), in all subcontracts awarded under this contract which requires the design, development, or operation of such a SOR.

h. In the event of violations of the Act, a civil action may be brought against the agency involved when the violation concerns the design, development, or operation of a SOR on individuals to accomplish an agency function, and criminal penalties may be imposed upon the officers or employees of the agency when the violation concerns the operation of a SOR on individuals to accomplish an agency function. For purposes of the Act, when the contract is for the operation of a SOR on individuals to accomplish an agency function, the contractor/subcontractor is considered to be an employee of the agency.

(1) "Operation of a System of Records" means performance of any of the activities associated with maintaining the SOR, including the collection, use, maintenance, and dissemination of records.

(2) "Record" means any item, collection, or grouping of information about an individual that is maintained by an agency, including, but not limited to, education, financial transactions, medical history, and criminal or employment history and contains the person's name, or identifying number, symbol, or any other identifying particular assigned to the individual, such as a fingerprint or voiceprint, or a photograph.

(3) "System of Records" means a group of any records under the control of any agency from which information is retrieved by the name of the individual or by some identifying number, symbol, or other identifying particular assigned to the individual.

i. The vendor shall ensure the security of all procured or developed systems and technologies, including their subcomponents (hereinafter referred to as "Systems"), throughout the life of this contract and any extension, warranty, or maintenance periods. This includes, but is not limited to workarounds, patches, hotfixes, upgrades, and any physical components (hereafter referred to as Security Fixes) which may be necessary to fix all security vulnerabilities published or known to the vendor anywhere in the Systems, including Operating Systems and firmware. The vendor shall ensure that Security Fixes shall not negatively impact the Systems.

j. The vendor shall notify VA within 24 hours of the discovery or disclosure of successful exploits of the vulnerability which can compromise the security of the Systems (including the confidentiality or integrity of its data and operations, or the availability of the system). Such issues shall be remediated as quickly as is practical, but in no event longer than 1 days.

k. When the Security Fixes involve installing third party patches (such as Microsoft OS patches or Adobe Acrobat), the vendor will provide written notice to the VA that the patch has been validated as not affecting the Systems within 10 working days. When the vendor is responsible for operations or maintenance of the Systems, they shall apply the Security Fixes within 1 days.

l. All other vulnerabilities shall be remediated as specified in this paragraph in a timely manner based on risk, but within 60 days of discovery or disclosure. Exceptions to this paragraph (e.g. for the convenience of VA) shall only be granted with approval of the contracting officer and the VA Assistant Secretary for Office of Information and Technology.

5. INFORMATION SYSTEM HOSTING, OPERATION, MAINTENANCE, OR USE

a. For information systems that are hosted, operated, maintained, or used on behalf of VA at non-VA facilities, contractors/subcontractors are fully responsible and accountable for ensuring compliance with all HIPAA, Privacy Act, FISMA, NIST, FIPS, and VA security and privacy directives and handbooks. This includes conducting compliant risk assessments, routine vulnerablity scanning, system patching and change management procedures, and the completion of an acceptable contingency plan for each system. The contractor's security control procedures must be equivalent, to those procedures used to secure VA systems. A Privacy Impact Assessment (PIA) must also be provided to the COR and approved by VA Privacy Service prior to operational approval. All external Internet connections to VA's network involving VA information must be reviewed and approved by VA prior to implementation.

b. Adequate security controls for collecting, processing, transmitting, and storing of Personally Identifiable Information (PII), as determined by the VA Privacy Service, must be in place, tested, and approved by VA prior to hosting, operation, maintenance, or use of the information system, or systems by or on behalf of VA. These security controls are to be assessed and stated within the PIA and if these controls are determined not to be in place, or inadequate, a Plan of Action and Milestones (POA&M) must be submitted and approved prior to the collection of PII.

c. Outsourcing (contractor facility, contractor equipment or contractor staff) of systems or network operations, telecommunications services, or other managed services requires certification and accreditation (authorization) (C&A) of the contractor's systems in accordance with VA Handbook 6500.3, Certification and Accreditation and/or the VA OCS Certification Program Office. Government- owned (government facility or government equipment) contractor-operated systems, third party or business partner networks require memorandums of understanding and interconnection agreements (MOU-ISA) which detail what data types are shared, who has access, and the appropriate level of security controls for all systems connected to VA networks.

d. The contractor/subcontractor's system must adhere to all FISMA, FIPS, and NIST standards related to the annual FISMA security controls assessment and review and update the PIA. Any deficiencies noted during this assessment must be provided to the VA contracting officer and the ISO for entry into VA's POA&M management process. The contractor/subcontractor must use VA's POA&M process to document planned remedial actions to address any deficiencies in information security policies, procedures, and practices, and the completion of those activities. Security deficiencies must be corrected within the timeframes approved by the government. Contractor/subcontractor procedures are subject to periodic, unannounced assessments by VA officials, including the VA Office of Inspector General. The physical security aspects associated with contractor/ subcontractor activities must also be subject to such assessments. If major changes to the system occur that may affect the privacy or security of the data or the system, the C&A of the system may need to be reviewed, retested and re- authorized per VA Handbook 6500.3. This may require reviewing and updating all of the documentation (PIA, System Security Plan, Contingency Plan). The Certification Program Office can provide guidance on whether a new C&A would be necessary.

e. The contractor/subcontractor must conduct an annual self assessment on all systems and outsourced services as required. Both hard copy and electronic copies of the assessment must be provided to the COR. The government reserves the right to conduct such an assessment using government personnel or another contractor/subcontractor. The contractor/subcontractor must take appropriate and timely action (this can be specified in the contract) to correct or mitigate any weaknesses discovered during such testing, generally at no additional cost.

f. VA prohibits the installation and use of personally-owned or contractor/ subcontractor-owned equipment or software on VA's network. If non-VA owned equipment must be used to fulfill the requirements of a contract, it must be stated in the service agreement, SOW or contract. All of the security controls required for government furnished equipment (GFE) must be utilized in approved other equipment (OE) and must be funded by the owner of the equipment. All remote systems must be equipped with, and use, a VA-approved antivirus (AV) software and a personal (host-based or enclave based) firewall that is configured with a VA-approved configuration. Software must be kept current, including all critical updates and patches. Owners of approved OE are responsible for providing and maintaining the anti-viral software and the firewall on the non-VA owned OE.

g. All electronic storage media used on non-VA leased or non-VA owned IT equipment that is used to store, process, or access VA information must be handled in adherence with VA Handbook 6500.1, Electronic Media Sanitization upon: (i) completion or termination of the contract or (ii) disposal or return of the IT equipment by the contractor/subcontractor or any person acting on behalf of the contractor/subcontractor, whichever is earlier. Media (hard drives, optical disks, CDs, back-up tapes, etc.) used by the contractors/ subcontractors that contain VA information must be returned to the VA for sanitization or destruction or the contractor/subcontractor must self-certify that the media has been disposed of per 6500.1 requirements. This must be completed within 30 days of termination of the contract.

h. Bio-Medical devices and other equipment or systems containing media (hard drives, optical disks, etc.) with VA sensitive information must not be returned to the vendor at the end of lease, for trade-in, or other purposes. The options are:

(1) Vendor must accept the system without the drive;

(2) VA's initial medical device purchase includes a spare drive which must be installed in place of the original drive at time of turn-in; or

(3) VA must reimburse the company for media at a reasonable open market replacement cost at time of purchase.

(4) Due to the highly specialized and sometimes proprietary hardware and software associated with medical equipment/systems, if it is not possible for the VA to retain the hard drive, then;

(a) The equipment vendor must have an existing BAA if the device being traded in has sensitive information stored on it and hard drive(s) from the system are being returned physically intact; and

(b) Any fixed hard drive on the device must be non-destructively sanitized to the greatest extent possible without negatively impacting system operation.