ATTACHMENT B - Statement of Work.docx

MEDICAL/SURGICAL PRIME VENDOR

GENERATION-Z VERSION 1 (MSPV GEN-Z V1)

STATEMENT OF WORK (SOW)

DEPARTMENT OF VETERANS AFFAIRS

Tracker ID:

November 10, 2022 Prepared By:

Office of Procurement, Acquisition and Logistics (OPAL) Strategic Acquisition Center (SAC) 10300 Spotsylvania Avenue, Suite 400 Fredericksburg, VA 22408

Table of Contents

SOW – MSPV Gen-Z V1 Page 1 of 77

MEDICAL/SURGICAL PRIME VENDOR GENERATION-Z VERSION 1

Section I. Scope

Definitions may be found in Appendix A: Definitions.

A. 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 1,298 health care facilities, including 171 medical centers and 1,113 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 Frederick, MD, and its assigned Contracting Officer (CO).

B. Scope

1. This Statement of Work (SOW) provides for performance of MSPV support for Authorized Customers within the geographic area specified in Appendix C: VISN Map and Table herein. The Prime Vendor (PV) offerors will propose pricing for each MSPV Contract Line Item Number (CLIN) identified in the contract. Each CLIN is a VA Veteran Integrated Service Network (VISN), other government agency (OGA), or the territory of Puerto Rico. 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 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 Product List separately established by VA. For each MSPV Product List supply, VA has identified an authorized source of supply and pricing through a separate Request for Quote(s) (RFQ), evaluation, and selection process. Pricing established through this process will be maintained as the pricing for each supply. VA-authorized suppliers are subject to the terms established by their own particular supply agreements, including applicable Federal Acquisition Regulation (FAR) and VA Acquisition Regulation (VAAR) clauses and other terms and restrictions under which supply agreements were solicited and awarded. The MSPV Product List of authorized suppliers will be made available to PVs; it is anticipated that supplies will be added to and removed from the MSPV Product List throughout the Period of Performance (PoP) of this SOW. The MSPV Product List, in addition to serving as a comprehensive list of supplies 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. In the future, the VA may utilize the 832 transaction set for transmitting updates to the Product List via Electronic Data Interchange (EDI).

c. The PVs shall fill supply orders placed under this SOW by establishing bilateral commercial agreements with all VA authorized suppliers to distribute the specific supplies identified on the MSPV Product List. In establishing these bilateral commercial agreements, the PV shall assure that the agreements contain all VA-required terms, conditions and/or clauses. Prices billed to PVs by authorized suppliers for supplies shall be at the current Blanket Purchase Agreement (BPA) price current as of the date VA places an order. For example, if an order is placed on the 14th of the month, the new Product List is published on the 15th, delivery is received after the Product List update, the invoice shall reflect the price effective on the 14th. MSPV Gen-Z V1 authorized Suppliers shall be paid prices listed for supplies on the MSPV Product List, regardless of the “into stock cost” for the PV.

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 prompt payment to suppliers for supplies delivered to Authorized Customers.

e. The commercial practice of chargebacks will be permitted under the MSPV program and shall be charged by the PV to the Authorized supplier. This practice, similar to a rebate, is defined and permitted only for recouping distributor costs resulting from the price difference between a distributor’s acquisition cost and the contractually agreed upon BPA price, between the Authorized supplier and the Government. The amount of the chargeback is calculated as the difference between the acquisition cost and the authorized customer’s contracted price times the quantity of product sold to the customer. VA reserves the right to request breakdowns of these chargebacks.

f. The PV is prohibited from charging commercial fees to VA authorized suppliers; however, applicable commercial fees may be charged to VA. Commercial fees are defined as fees that capture the costs of services that a distributor provides to the authorized supplier as part of the process of distributing items from the supplier to the customer. Commercial fees shall be charged to VA as a Sub-CLIN in Attachment A in the Request for Proposals (RFP). Examples of commercial fees include, but are not limited to, electronic funds transfer (EFT) or Automated Clearing House (ACH) fee, administrative fees, reporting/tracing fees, procurement, and inventory management fees. VA reserves the right to request an itemized breakdown of commercial fees. These commercial fees shall be assessed as a percentage of the order value that represents the PVs cost and profit associated with services that a distributor provides to the authorized supplier as part of the normal business process of distributing items from the supplier to the authorized customer.

g. 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 current BPA price on the date VA places the order. The distribution fees charged by the PV for the delivery of the medical/surgical supplies to the Authorized Customer will be calculated as provided in Section I.D Type of Contract, herein, and in the Contract Pricing Schedule, and invoiced separately.

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

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

c. Orders for, or including, any supply that is not expressly identified on VA’s MSPV Product List (except supplies removed from VA’s MSPV Product List, which may be delivered up to 60-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 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 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. Authorized customers will fulfill requirements within the scope of this contract to the maximum extent possible. However, nothing in this SOW will restrict or limit authorized customers from fulfilling requirements through alternate procurement vehicles.

4. The Office of Procurement for VHA will ensure that supplies are placed on the MSPV Product List from which Authorized Customers may order. It is incumbent on the PV to honor the parameters of the 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 requirements, within the scope of the contract, 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. The PV must be capable of receiving electronic (EDI) updates to the Product List.

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.

C. Government Authorized Customers

1. The PV shall provide distribution and supply management services for Medical/surgical supplies and select medical equipment on the MSPV Product List to the awarded CLIN(s) and corresponding Authorized Customers specified in Appendix F: MSPV Gen-Z V1 Delivery Addresses. 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 to the list of new ordering locations (i.e., new outpatient clinics, contingency warehouse).

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 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 the MSPV Gen-Z V1 program, 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 Gen-Z V1 Program.

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 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/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.

e. Veterans Benefits Administration (VBA)

i. The VBA is responsible for administering the VA’s programs that provide financial and other forms of assistance to veterans, their dependents, and survivors in a responsive, timely, and compassionate manner in recognition of their service to the Nation. Major benefit programs include Disability Compensation, Pension Programs, Dependency, and Indemnity Compensation (DIC) support, Burial and Interment Allowances, Education resources to Veterans and Veterans’ dependents, and Vocational Rehabilitation and Employment (VR&E) programs.

f. National Cemetery Administration (NCA)

i. The NCA operates 155 national cemeteries and 34 soldiers' lots and monument sites in 42 states and Puerto Rico. More than 4 million Americans, including Veterans of every war and conflict, are buried in VA's national cemeteries. VA also provides funding to establish, expand, improve, and maintain 119 Veterans cemeteries in 48 states and territories including tribal trust lands, Guam, and Saipan. For Veterans not buried in a VA national cemetery, VA provides headstones, markers, or medallions to commemorate their service.

g. Veterans Affairs Central Office (VACO)

i. Located in Washington, D.C., VACO directs the activities of the VA regional offices (sometimes called Veterans Service Centers) and the VA medical centers. The Central Office dictates standard rules and procedures for regional offices and medical centers when handling claims. The Central Office consists of the VBA, headed by the VA undersecretary for benefits, and the VHA, headed by the Under secretary for Health, who oversees the VA medical care facilities. Other departments in VACO include the office that oversees the national cemetery system (NCA) the Office of General Counsel (OGC), and the Office of Inspector General (OIG).

h. Department of State

i. Located in Dulles, Virginia, this Department of State Office has historically been supported by the VA MSPV program.

D. Type of Contract

1. The resulting acquisition vehicle will be a multiple-award Indefinite Delivery Indefinite Quantity (IDIQ) contract in accordance with Federal Acquisition Regulation (FAR) 16.504. Delivery orders awarded against this IDIQ will require 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. PV(s) will propose distribution fees for each CLIN to provide PV distribution and supply management services. These distribution fees shall be assessed as a percentage of the order value that represents the PVs cost and profit associated with activities related to “last mile delivery”. Value-added service fees to the VA shall be charged in accordance with RFP Attachment A and include, but are not limited to, OSR fee, emergency delivery and drop shipments. Individual facilities will elect to utilize these additional services and will pay the agreed upon fee.

2. The ordering period for the base IDIQ contract is five (5) years with one optional period of five (5) years. Each delivery order shall specify the period of performance that will govern a particular delivery order awarded under the base IDIQ contract in accordance with FAR 16 procedures. There is an effort to determine the feasibility of a joint VA/DLA contract, and depending on the outcome of that effort, IDIQ and delivery order option periods may not be exercised by the VA.

Section II. MSPV Business Processes

A. Commercial Supplier Agreements for Medical Surgical Supplies

1. As part of the PV obligations outlined in this contract, the PV must have bilateral commercial agreements in place with all VA authorized suppliers for the MSPV Product List supplies. Over the life of this agreement, suppliers and supply items may be added to and removed from the MSPV Product List, as well as prices for supply items on the MSPV Product List may be adjusted. Within 60 consecutive days of the respective supplier’s addition to the MSPV Product List, PV’s bilateral commercial agreements must provide coverage for all suppliers who are contracted with the VA before program implementation.

a. After contract implementation, new authorized suppliers will establish contracts or Blanket Purchase Agreements (BPA) with VA and be added to the MSPV list of authorized suppliers to support facility needs. PVs shall add these new authorized suppliers on a rolling basis. PVs shall have no more than 60-consecutive days from the release of an updated MSPV Product List to establish bilateral commercial agreements with new authorized suppliers and begin accepting orders for new supplies.

2. The PV shall negotiate with VA-authorized suppliers to establish bilateral commercial agreements for distribution of the products/services included in the master listing. VA-authorized suppliers are subject to the terms established by their own particular supply agreements, including applicable Federal Acquisition Regulation (FAR) and VA Acquisition Regulation (VAAR) clauses and other terms and restrictions under which supply agreements were solicited and awarded. The terms applicable to the VA-authorized suppliers include that they (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 (FAR 52.225-1, -2) or Trade Agreement Act (FAR 52.225-5, -6) as determined by award of the underlying supply agreement. The PV shall notify the VA if the PV learns that the VA-authorized supplier's compliance with any of the aforementioned conditions has lapsed. The PV shall remove the noncompliant items upon notification/product removal from the authorized MSPV Product List and or the Cognizant CO. All noncompliant items removed will be evaluated for substitution through the current supplier or a new supplier with collaboration and approval from the VA.

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 shall 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 Medical Supply Program Office (MSPO) and a contingency plan needs to be developed.

4. The PV shall provide a monthly report to the SAC and MSPO detailing the list of authorized suppliers with whom PVs have been able and unable to establish a commercial agreement. At a minimum, the report should identify the VA Procurement Instrument Identifier (PIID or 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.

5. It is the intention of VA to limit passthrough arrangements between PVs and VA authorized suppliers. To that end, VA authorized suppliers are not required to take physical possession of supplies only in instances where the OEM does not allow for PV distribution. 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 Product List.

a. If a supply is removed from the MSPV Product List, the PV may continue for up to 60-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 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 bilateral commercial agreements prescribed in this section are solely between the PV and VA authorized suppliers, and do not involve the Government as a party.

B. Prime Vendor Order Number (PVON) for New PVs

1. Within 90-consecutive days of any contract under this SOW, the PV shall have its Information Technology representative, responsible for assigning the PVON, contact the Authorized Customer Contracting Officer 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.), however, PVONs may include dashes. The PV shall be responsible for accessing the MSPV 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. Upon notification from an authorized customer, the PV shall have seven business days to establish a PVON for items with a supplier already under a commercial agreement, and 60 consecutive days to establish a PVON for items provided by suppliers not currently under a commercial agreement.

C. Supply Classification

1. Core List: Utilizing the MSPV 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. 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 Product List. LUM is defined as any UOM less than the quantity available for conventional/bulk delivery on the MSPV Product List. The PV shall 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. If, after reviewing the Core List recommendations from the PV a facility does not remove the Core designation from an item that does not meet the criteria for a Core Item, the PV shall attempt resolution by following the resolution process identified in Section II.E. below. Supplies that have been identified as Core Items by a facility that are not ordered for 90 consecutive days may, if approved by the SAC CO, be subject to the buy-out provisions of this SOW.

2. Non-Core List: Utilizing the MSPV 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 shall 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.

3. PVs shall 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. Facility CORs will work with PV representatives to evaluate emergency cases and adjust approved emergency response plans as needed. Facility CORs will also work with PV representatives to identify frequently ordered emergency items and evaluate their suitability for MSPV Product List designation if not already included.

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 contractual 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

D. PV Support

1. PVs shall propose for VISNs to which they wish to provide distribution services. Upon delivery order 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 will then determine if this ESD is acceptable or cancel the order. PVs may not cancel backordered supplies without customer approval. The PV shall send backorder, substitute, replacement information in the 855 Purchase Order Acknowledgement (POA) via EDI, when applicable, based on current VA EDI implementation guidelines. Backorders for products that cannot be delivered within 90 days of the initial order date will be cancelled except for products that are on an allocation.

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.

E. 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. MSPO and SAC CO

2. CORs will validate that PVs provide all alternative/substitute items available from the MSPV Product List when the need for substitute arises, not just a singular recommendation.

3. VHA MSPO and SAC will monitor the Supplier Agreement Report and facilitate issue resolution during instances where agreements cannot be reached. The SAC CO will facilitate collaboration between PVs and authorized suppliers to aid in agreement formation when necessary.

4. If deemed necessary for issue resolution, only the warranted CO may obligate the Government or modify the terms and conditions of the contract or DO.

Section III. VA Ordering Procedures

A. Contract/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 by VA FSC, Electronic Commerce Branch (ECB) who will create and/or process ANSI X12 compliant EDI transactions including, but not limited to, the 850 Purchase Order (PO), 855 Purchase Order Acknowledgement (POA). The PV shall also accept other types of orders and order changes via fax, telephone, and the PV’s web portal, only during emergencies or system failures. 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. The PV shall be given a reasonable amount of time, agreed upon by MSPO, SAC, VA FSC, and the PV, to implement any new technical requirements.

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 shall determine the appropriate distribution center or method to fulfill the order within the designated region. The PV shall be capable to receive, manage, and fulfill 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 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 the 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 establish communications between VA FSC and the PV, using either a direct connection, or a Value-Added Network. A direct connection (either Applicability Statement [AS2], or Secure File Transfer Protocol [SFTP]) requires an Interconnection Security Agreement (ISA) Memorandum of Understanding (MOU) between VA FSC and the PV. The PV shall host a SFTP server, if they select a direct SFTP connection to exchange EDI transactions with VA. If they do not have a VAN in place, the PV shall 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. Order confirmations must be received within two hours of the vendor receiving the order.

a. EDI Order Confirmation Report: The PV shall provide a monthly report to FSC and the Medical Supply Program Office (MSPO). 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:

· 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 addresses 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.

a. Federal Government Holidays:

i. Federal Government Holidays are indicated below, except for holidays designated by Presidential declaration. Alternate delivery dates may be mutually established in writing. The PV shall be required to make regularly scheduled deliveries on company holidays that do not coincide with the list of Federal holidays below unless alternate delivery dates have been mutually established in written communication.

New Year’s Day January 1st

Martin Luther King Jr.’s Birthday 3rd Monday in January

President’s Day 3rd Monday in February

Memorial Day Last Monday in May

Juneteenth June 19th

Independence Day July 4th

Labor Day 1st Monday in September

Indigenous Peoples’ Day 2nd Monday in October

Veterans Day November 11th

Thanksgiving Day 4th Thursday in November

Christmas Day December 25th

ii. When a Federal Government holiday falls on a Sunday, the following Monday shall be observed as a legal holiday. If a Federal Government holiday falls on a Saturday, Federal Government agencies observe the preceding Friday as a legal holiday.

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 submitting an order electronically 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, 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 screen and reject duplicate orders. Order confirmations must be received within two hours of the vendor receiving the order.

a. The order confirmation must be in identical sequence to the order placed by the ordering facility. The confirmation shall be communicated using an ANSI X12 compliant 855 purchase order acknowledgement transaction. 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 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, in addition to the 856, an email that contains shipment notice of the order and any other relevant information will need to be sent to the ordering facility with the shipment notice. The PV shall segregate the Authorized Customer’s orders by order/call number and by ordering site within the Authorized Customer. Multiple orders/calls can be placed on a single pallet if the orders/calls remain segregated. The PV shall comply with the carrier’s requirements involving shipment via air. The PV shall provide an itemized packing list for each PO on the delivery.

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 MSPV Gen-Z V1 Delivery Addresses. The times the facility has listed as their preferred window is the time the PV is required to deliver 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).

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 if approved in advance by the ordering facility. 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 unapproved 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 shall inform the authorized customer, MSPO, FSC, and SAC of the changes 90-consecutive days before any changes take place. The PV shall explain to the authorized customer, MSPO, 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, MSPO, 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.

12. Facility Service Level Election: Authorized customers must complete and submit the Government provided MSPV Gen-Z V1 Service Level Election Form (SLEF) to the PV, indicating required PV distribution services. The SLEF must be signed by the facility CSCO or COR and the PV. PVs shall acknowledge and provide a signed copy of the SLEF back to the corresponding facility. Upon completion, a final copy of the SLEF will be maintained by the facility COR with a copy provided to the PV and a copy provided to MSPO. Upon any changes to the selected services, a new SLEF will be completed with copies distributed as previously described.

B. Emergency Support and 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 eyesight or impedes the ability to perform time-sensitive medical procedures. The designation of an emergency order must be made at the time of order placement unless a threat concerning the loss of life, limb, or eyesight occurs during the delivery timeframe provided by the vendor, and at that time, the emergency order 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 MSPV 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.

d. The PV shall provide each supported customer with information and training on any options/services available for emergency support. The PV shall work with each supported customer in developing an emergency response plan and assist in establishing contingency orders tailored to specific scenarios. Procedures for implementing a contingency order will be mutually agreed upon by the PV and the customer before presenting to the CO and MSPO for approval. The development of a mutually agreed upon initial emergency response plan between the PV and customer shall be submitted to the SAC and MSPO for approval prior to the end of the implementation period. After approval, the contingency orders will become part of the emergency response plan. Emergency response plans will be reviewed jointly by the PV and the customer as needed but no less than annually. Notification will be provided to the CO and MSPO upon completion of the annual review. Approved emergency response plans, once executed, will remain in effect until the authorized customer, at the appropriate level (e.g., facility, VISN, etc.), can again fulfill their mission or is otherwise agreed upon between the PV and customer in the approved emergency response plan.

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 CSCOs will then review and approve. This plan shall specifically address de-conflicting orders for supplies and formal cooperation agreements to ensure adequate support of 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 MSPO will be notified should unresolvable issues prevent plan agreement. Acceptable performance is defined as 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 shall accept all types of orders and order changes via fax, telephone, and the PV’s web portal. Emergency orders can be placed directly with the PV representative. For additional requirements see Section III.A.1 Ordering Methods.

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 12hours 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.