P03 NCO21-FY23-255 JOFOC 36C261-23-AP-1294 Crestwood Behavioral Health CNH - HCA Approved - Copy.pdf

VHAPG Part 813.5 Simplified Acquisition Procedures for Certain Commercial Items

Effective Date: 02/01/2022 Page 1 of 5

DEPARTMENT OF VETERANS AFFAIRS

SOLE SOURCE JUSTIFICATION UNDER SIMPLIFIED PROCEDURES FOR CERTAIN

COMMERCIAL ITEMS IN ACCORDANCE WITH FAR 13.5

Acquisition Plan Action ID: 36C261-23-AP-1294

1. Contracting Activity: Department of Veterans Affairs (VA), Regional Procurement Office West

(RPOW), Network Contracting Office (NCO) 21 on behalf of the Veterans Integrated Service

Networks (VISN) 21, VA Northern California Health Care System (VANCHCS).

2. Nature and/or Description of the Action Being Processed: VANCHCS has an ongoing need for

Community Nursing Home (CNH) services to serve Veterans that are currently located within the facility. The families of seven (7) Veterans who are currently located at the facility do not want to move their family member due to medical hardship on the patient, disruption in treatment plan, and disruption to family members in the local area.

In accordance with (IAW) FAR 6.302-1, Only One Responsible Source and No Other Supplies or

Services Will Satisfy Agency Requirements, a sole source award will be made to Crestwood

Behavioral Health Inc. The type of contract will be a Firm Fixed Price (FFP) Indefinite

Delivery/Indefinite Quantity (ID/IQ) with Economic Price Adjustment (EPA) consisting of five (5) one-year ordering periods.

FAR 13.5 Simplified Procedures for Certain Commercial Items: This procurement will be accomplished IAW FAR 13.5 Simplified Procedures for Certain Commercial Items and specifically

FAR 13.501 Special Documentation Requirements, where acquisitions conducted under Simplified

Acquisition Procedures are exempt from the requirements of FAR Part 6, but still require a justification using the format of FAR 6.303-2.

3. Description of Supplies/Services Required to Meet the Agency’s Needs: The proposed action is to award a FFP ID/IQ with EPA with the rates adjusting only to the current published Medicaid rate, with a nursing home facility capable of furnishing the total medical, nursing, and psychosocial needs of VA beneficiaries.

• All nursing home facility(s) must have current Center of Medicare and Medicaid Services

(CMS) certification (Medicare and/or Medicaid) and a State nursing home license.

• The VA requires CNHs to have bed capacity to ensure their ability to take referrals when requested. The CNH also must be able to accept VA referrals in a timely fashion (within 24 hours of request).

• Provider visits must be provided at the rate of one (1) visit per month. Laboratory, x-ray, and other special services will be available to VA patients as needed. In addition, the care provided will include room, meals, nursing care, and other services or supplies commensurate with the VA-authorized level of care, without extra charge.

• The per diem rate(s) established in the ID/IQ shall include the cost of primary medical care, one (1) provider visit per month and needed consultation, drugs and routine supplies, laboratory, x-ray, and other special services authorized by VA, unless otherwise specifically excepted.

Effective Date: 02/01/2022 Page 2 of 5

• Full attention shall be given to motivating and educating patients to achieve and maintain independence in the activities of daily living. Every effort shall be made to keep patients ambulatory and to achieve an optimal level of self-care.

The total estimated value of the proposed action is not to exceed (NTE) $6,000,000.00 over the term of the ID/IQ for five (5) one-year ordering periods and will allow for increased needs over the government's estimate, if required. The guaranteed minimum for the contract is one (1) room for one

(1) veteran for one (1) day.

Total Estimated Annual Cost for facility: $1,126,183.41

ID/IQ Limit: $6,000,000.00

4. Statutory Authority Permitting Restricted Competition:

FAR 13.5 Simplified Procedures for Certain Commercial Items. The statutory authority for applying the Simplified Procedures for Commercial Items of FAR 13.5 is 41 U.S.C. § 1901 and is implemented by FAR 13.106-1(b)(2) for restricting competition on this procurement. Competition is restricted on this procurement for the reason below:

( x ) Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency

Requirements

( ) Unusual and Compelling Urgency

( ) Industrial Mobilization, Engineering, Developmental or Research Capability or Expert

Services

( ) International Agreement

( ) Authorized or Required by Statute

( ) National Security

( ) Public Interest

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition

Requires the Use of the Authority Cited Above (applicability of authority):

As prescribed in VHA Handbook 1143.2, VHA Community Nursing Home Oversight Procedures, for more than 35 years the CNH Program has maintained two cornerstones: some level of patient choice in choosing a nursing home close to the Veteran’s home and family, and a unique approach to local oversight of CNHs.

The quality of care for the Veteran is accomplished through placement in a nursing home that is in close proximity to where the Veteran and his/her family resides. Notably, in the VA’s community nursing home program the Veteran’s placement decision is made by the VA clinician(s)/provider(s), the Veteran, and the Veteran’s family. The placement decision will be based on established VA contracts within the catchment area the Veteran resides. The geographic factor in these circumstances makes this requirement unique and, therefore, not subject to competition.

Crestwood Behavioral Health Inc. is currently providing a much-needed service to seven (7) Veterans within the immediate geographical location of the facility. The seven (7) Veterans qualify to be beneficiaries of CNH services through the VA CNH program and relocation to a different facility may disrupt treatment plans and may become an undue burden for family members. To avoid disruption to the Veterans, the VA must award a new contract to Crestwood Behavioral Health Inc.

Effective Date: 02/01/2022 Page 3 of 5

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

a. A query of the VetCert data base was generated using North American Industry Classification

System (NAICS) 623110 Key Words Skilled Nursing Facility, with a States Searched-Strict

California which produced zero (0) Service-Disabled Veteran Owned Small Businesses

(SDVOSBs) or Veteran Owned Small Businesses (VOSBs). A query on Medicare.gov, Nursing Home Compare, confirmed there are a total of 23 licensed nursing homes in the

Modesto, CA area; resulting in the following CNH star ratings: three (3), five (5) stars-much above average; seven (7), four (4) stars-above average-including Crestwood Behavioral Health;

six (6), three (3) stars-average; two (2), two (2) stars-below average; four (4), one (1) star-much below average; zero (0), Overall rating not available: zero (0).

b. There are seven (7) Veterans currently residing at Crestwood Behavioral Health CNH.

Relocating the Veterans to another facility already under contract would have a negative impact on the patient care and necessitates sole sourcing this procurement.

c. IAW FAR 13.501(a)(1)(iii), this action will be synopsized at award on Contracting

Opportunities and the justification will be made publicly available.

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and

Reasonable:

Fair and reasonable pricing will be determined IAW FAR 13.106-3(a)(2). Pricing will be evaluated to be fair and reasonable based on a comparison to the Independent Government Cost Estimate (IGCE), and established Medicare Resource Utilization Group (RUG IV) rates and or the state issued

Medicaid rate. In addition, upon receipt of the Contractor’s quote, the Contracting Officer (CO) will request/negotiate a discount of the original rates/percentages received; ensuring the rates are fair and reasonable. The Government estimate was prepared based on established Medicaid RUG IV rates for various levels of care and established VA nursing home rates based on VA national guidelines for determining cost for VA nursing home contracts; to include expenditures for Fiscal Year (FY) 21 for

CNH services provided at Crestwood Behavioral Health Inc.

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons

Market Research Was Not Conducted:

CNH services are considered to be a commercial service; therefore, market research was conducted using the following platforms: Medicare.gov Nursing Home Compare, VetCert data base, VA website for Veteran population data, SAMBeta.gov website (Contract Opportunities only), SBA’s Dynamic

Small Business Search Tool, North American Industry Classification System (NAICS), and General

Service Administration (GSA)’s eLibrary. The last method of market research conducted for this unique service, is the on-going periodic outreach with local potential Contractors conducted by the

CNH Coordinator and Contracting Officer’s Representative (COR). The search using Medicare.gov

Nursing Home Compare conducted by the Contract Specialist (CS) confirmed there are a total of 23 licensed nursing homes in the Modesto, CA area. Results noted the following:

Description Number of Facilities

Facility has a Much Above Average rating (5/5) 3

Facility has an Above Average rating (4/5) 7*

Facility has an Average rating (3/5) 6

Facility has a Below Average rating (2/5) 2

Facility has a Much Below Average rating (1/5) 4

*Includes Crestwood Behavioral Health, Inc.

Effective Date: 02/01/2022 Page 4 of 5

A query of the VetCert data base was generated using NAICS 623110 and Key Words Skilled Nursing

Facility and Nursing Home with a States Searched-Strict California which produced zero (0) Service-

Disabled Veteran Owned Small Businesses (SDVOSBs) or Veteran Owned Small Businesses (VOSBs).

A search on SAMBeta.gov website (Contract Opportunities only) was conducted using the following:

Key Words: Skilled Nursing Facility; Status: Active; Agency: VA resulting in (0) opportunities. SBA’s

Dynamic Small Business Search Tool was used with the following search criteria: NAICS 623110 Key

Words Skilled Nursing Facility, and States Searched-Strict California, SDVOSB, and VOSB which produced zero (0) SDVOSB or VOSB. A query on NAICS using the following search criteria: Key

Words Skilled Nursing Facility resulted in the following code: 623110. A search on GSA library using the following: Key Words Community Nursing Home Service and Skilled Nursing Facility resulted in: no matches found using your search criteria.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

As prescribed in VHA Handbook 1143.2, the CNH Program has maintained two (2) corner stones:

some level of patient/Veteran choice in choosing a nursing home close to the Veteran’s home and family; and a unique approach to local oversight of CNHs. Thus, the Veteran, the Veteran’s family and CNH program personnel will have the choice of selecting a nursing home best suited for the

Veteran’s need. The Contractor, Crestwood Behavioral Health Inc., is currently providing satisfactory

CNH services for the seven (7) Veterans. The geographic factor in the CNH service makes the requirement unique and, therefore, not subject to competition. The Veteran’s, and family member(s) location, prior to the authorization for the unique service is the driving force behind the geographical location of the CNH. The VA does not intend on disrupting the Veteran’s quality of life, by separating the patient from his/her family member(s) due to the required unique service; in saying that, it is in the best interest of the Veteran(s) and the Government to award a sole source FP ID/IQ to

Crestwood Behavioral Health Inc. to support VANCHCS’s mission, and the seven (7) Veterans.

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

The Contractor, Crestwood Behavioral Health Inc., is currently providing CNH services to seven (7)

Veterans. The Contractor is willing to continue providing services to the Veterans receiving services in the facility.

11. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any Barriers to Competition before Making subsequent acquisitions for the supplies or services required:

Based on the inherent nature of the service and in line with VA policy where the Veteran and his/her family play a role in determining which nursing home facility will provide treatment for the Veteran, the opportunity to increase competition is limited.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona

Fide Need of the Department of Veterans Affairs and that the supporting data under my cognizance, which are included in the justification are accurate and complete to the best of my knowledge and belief.

Glynis Banks Date

Contracting Officer’s Representative

VANCHCS

Effective Date: 02/01/2022 Page 5 of 5

13. Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

a. Contracting Officer or Designee’s Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

Joleo Dianala

Contracting Officer

Network Contracting Office 21

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $750K): I certify the justification meets requirements for other than full and open competition.

Brooke C. Robison Date

Director of Contracting

Network Contracting Office 21

c. VHA RPO HCA Review and Approval: I have reviewed the foregoing justification and find it to be complete and accurate to the best of my knowledge and belief and approve ($750K to $75 million) for other than full and open competition.

Curtis M. Jordan Date

Executive Director, Regional Procurement Office West

Head of Contracting Activity (HCA) http://vaww.pclo.infoshare.va.gov/PMWeb/VHAPM_Part_806.3.aspx VHAMACRobisB Typewritten Text

11 JUL 23