OCC Equip Svcs_JandA_Transition 12months_supplemental_Final Redacted 07212022.pdf

DEPARTMENT OF VETERANS AFFAIRS

Office of Procurement, Acquisition and Logistics (OPAL)

Strategic Acquisition Center (SAC) 10300 Spotsylvania Ave, Suite 400

Fredericksburg, VA 22408

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity: Department of Veterans Affairs (VA)

Strategic Acquisition Center (SAC)

2. Description of Action: This justification and approval sets forth the facts and requests approval to modify the current sole source Equipment and Services Requirements Contract on behalf of VA’s Veterans Healthcare Administration (VHA) Office of Connected Care (OCC). To support the transition effort, an extension is needed for the existing procurement with Iron Bow Technologies, LLC under contract number 36C10G21D0016, which will otherwise expire on September 29, 2022. Such an extension is necessary to avoid a gap in service for critical and essential connected care technology equipment and services. The agency continues to work toward a competitive follow-on procurement which contemplates multiple awards and greater opportunities for Service-Disabled Veteran-Owned Small Businesses (SDVOSBs), Veteran-Owned Small Businesses (VOSBs), and/or other Small Businesses (SBs).

This contract action will result in a bilateral modification to the existing contract number 36C10G21D0016 for an extension of twelve (12) months. The estimated value of this action is $319,714,455.78. This transition contract modification will be awarded to the current contractor, Iron Bow Technologies, LLC, 2121 Cooperative Way STE 500 Herndon, Virginia 20171-5346.

In accordance with Federal Acquisition Regulation (FAR) 5.201 and 5.302, a synopsis/ notice of intent to sole source will be publicized for the proposed modification action. Additionally, an award notice including the Justification and Approval (J&A) will be posted to Contract Opportunities (SAM.gov) in accordance with regulatory requirements.

3. Description of Supplies or Services: The connected care technology network is a major VA system, exceptionally complex and diverse as it supports many clinical disciplines across VA enterprise. OCC requires all digital services, applications, platforms, architecture, and equipment to integrate effectively so that all components work together seamlessly to ensure VA's connected care technology system provides safe, effective, and quality medical and critical care. This contract modification will provide OCC with continued contract support that delivers the standardized equipment and services necessary to procure, maintain, enhance, remediate, integrate, deploy, and support OCC's connected care technology network. Patient safety and access to care are fundamental goals for VHA. This

Strategic Acquisition Center (SAC) network impacts multiple clinical disciplines and procedures and requires equipment, components, online health platforms, web and mobile medical applications, software, and infrastructure platforms that must be integrated through interfaces and enhancements to OCC connected care technologies.

This requirement is to provide continued support for VA's existing network for telehealth. VA’s network comprises of highly specialized equipment, to include more than 8,650 videoconferencing codec devices, 133,000 patient-issued iPads, 23,000 Provider issued iPads, and more than 175,000 peripheral devices such as stethoscopes, cameras, etc., out of more than 170 VA medical centers and 1,063 VA clinics. In FY21, over 2.5 million Veterans received at least some of their VA healthcare through over 10 million telehealth encounters. VA’s single National OCC Help Desk supports all VA sites and telehealth equipment and operates 24x7x365. This Help Desk is both Veteran and employee-facing and is staffed by a team of contractors who have been equipped and trained appropriately. The contractor utilizes Government Furnished Equipment and VA privacy and information security requirements to do the following: 1) support the registration of the equipment and components onto VA’s national network, 2) initiate and continue the service and warranty for each device, 3) troubleshoot, repair or replace each device as needed and, 4) respond to requests for assistance from Veterans and VA staff.

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

5. Rationale Justifying Use of Cited Statutory Authority: The Contracting Officer assigned the follow-on effort left the agency in March 2021 and a new Contracting Officer was assigned. Concerned that one single contractor for such a large, complex and growing requirement would hinder innovation and flexibility, the new Contracting Officer conducted research, along with the program office, to explore alternative acquisition strategies. After extensive market research and planning, discussed more fully below, VA reasonably determined it was more appropriate to break the requirement into three (3) smaller, separate and distinct contract vehicles, with the goal of providing more robust competition in the near future and more opportunities for small businesses. In significantly changing its acquisition strategy, VA’s long-term objective is to ultimately reduce its costs and administrative burden for such a critical and dynamic need.

The current contract expires on September 29, 2022. The agency has spent substantial time and resources breaking one work statement into three, in addition to changing all the other ancillary documentation. The change in acquisition

Strategic Acquisition Center (SAC) strategy and the transition from one contractor to multiple contractors requires sufficient lead time to enable mission success. If VA competed this interim requirement now, it would result in disruption in services, inadequate knowledge transfer, unacceptable delays, and substantial duplication of costs, including an increase in award cost caused by a new contractor start-up process; these points are addressed in more detail as follows:

Disruption in Services:

VA must continue to have a contractual vehicle in place to procure connected care technology equipment, software licenses, subscriptions and provide integrated services and solutions. In-depth knowledge of the connected care system is required to allow for continuity of operations and provide the insight that ensures the highest standards of performance, which is critical to facilitating the delivery of timely and safe healthcare for Veterans. Without an extension of the current contract, there will be a service disruption, which would have a detrimental effect on the health and well-being of Veterans, especially during the ongoing COVID-19 public health emergency and world-wide pandemic.

Knowledge Transfer:

Due to the scale and complexity of this requirement, the incumbent contractor is the only source currently that has the resources, knowledge, and expertise to permit an uninterrupted continuity of operations. The critical knowledge and capabilities required for this acquisition also apply to transferring and centralizing four maintenance agreement cycles:

VA Video Connect (VVC) hardware, application, and software maintenance;

Clinical Video codec maintenance;

Clinical Video cart and peripheral maintenance; and Clinical Video tablet maintenance.

For transition, any new contractor would need to 1) acquire knowledge from the current contractor; 2) transition and understand what is covered in the four separate but related maintenance agreements stated above; 3) ensure renewal option dates and deadlines are met, including applicable annual license agreements, and; 4) provide continuity in service for the existing and expanding inventory of connected care technologies. In addition, tablets loaned to Veterans include data plans specific to Mobile Service Providers (MSP). If a new contractor assumes responsibility for the OCC contract, there is potential for an MSP change which would necessitate swapping out physical SIM cards. Doing so would require VA to retrieve over 115,000 tablets currently issued to Veterans, replace the SIM cards, and reship the devices. As a result, Veterans would be unable to access VA video appointments and other services/apps enabled via the tablets.

Strategic Acquisition Center (SAC)

Unacceptable Delays:

Without transition and knowledge transfer of this large-scale complex requirement, there would be significant delays in getting a new contractor fully operational, resulting in delay of services required for Veteran Care.

Transitioning to a new contractor creates the risk of mission failure in terms of the following:

Comprehensive device offering of VA, OIT, and Telehealth-approved devices;

Integration of clinical and videoconferencing devices;

Comprehensive technical support through a Help Desk staff that has been appropriately vetted;

Completed T4 level background investigations;

Staff trained to support VA’s national telehealth network; and loss of development teams who support and enhance OCC’s mobile app portfolio.

If the existing services from the incumbent were completely severed today, the Government estimates that awarding to a new contractor would double the expected transition time, resulting in an estimated 22 months before a new contractor would be able to fully meet all requirements of this effort. For example, based on the current contract for the Help Desk, up to 12,500 VA staff and Veterans per week would no longer be able to receive assistance or support in using connected care products. New software could not be developed, existing applications would begin to fail immediately as they need continual maintenance, and VA applications would be removed from both the Apple App Store and Google Play store due to an inability to respond to app store requests for changes. The failure of a single shared service, such as user authentication, would result in all OCC mobile apps going offline, potentially for months, including such vital applications as VA’s video visit platform (VVC) as well as RX Refill, Annie, Image Viewing Solution, Stroke Code, and the Patient-Generated Health Database. The losses in function would extend to virtually all aspects of the OCC Program:

analytics, Virtual Health Resource Centers (VHRCs), implementation, communications, and training which would render OCC unable to fulfill its mission.

Duplication of Cost to the Government (Sunk Costs):

There is a substantial duplication of costs to the Government that is not expected to be recovered through competition. For example, over 115,000 tablets issued to Veterans would be rendered inoperable without registration in an active Mobile Device Management (MDM) platform. The transition to a new MDM, in concert with SIM card replacement, is expected to take up to 12 months. Telehealth video virtual visits are more cost-effective. As 115,000 tablets would be inoperable, this would shift patient care to “care in the community” and increase primary care visits resulting in an increase in estimated Government cost of ~$199M. Additionally, VA

Strategic Acquisition Center (SAC)

Health Chat provides the Government with cost savings of ~$7.9M through the resolution of medical needs rather than through Primary Care, Emergency Department, Urgent Care, and Triage Nurse appointments that Veterans would have pursued instead. Any service interruption would eliminate the cost savings of this program until a new contractor can begin maintaining or replacing the app.

These costs equate to a total cost of $206.9M sunk costs that will be unrecoverable through competition of this transition period.

Summary:

Awarding this contract to another source without the opportunity for appropriate transition time would interrupt services and have a deleterious effect on the health and well-being of Veterans who access VA healthcare through connected care services nationwide. First, Veterans who are home-bound or have other conditions or circumstances that inhibit their ability to receive healthcare in person would not be able to access care timely. This could worsen health conditions and prolong appointment wait times due to increased requests for in-person care. Second, unaddressed equipment malfunctions will cause Veterans to be without medical care. Third, Veterans nationwide and their caregivers cannot afford the wait required for Veterans to travel to and from VA medical facilities to access care.

Lastly, access to VA healthcare through connected care services is critically important during the COVID-19 pandemic. As outlined above, service interruptions would incur and a duplication of costs at a conservative estimate of $206.9M.

Delays are related to changes in the acquisition strategy. Due to COVID-19, OCC’s programs have expanded significantly in scope and scale; this expansion has caused delays by adding to the complexity of the requirements. VA needs time to transition from one diverse, complex contract to the anticipated three separate competed contracts. The only reasonable and viable solution to avoid an interruption in the services and the shutdown of the Connected Care program is to extend the existing contract for twelve months.

6. Description of Efforts to Solicit Offers from as Many Offerors as Practicable: To ensure that market research was conducted, to as many potential sources as practicable, a series of Request for Information (RFIs) were issued to industry.

These RFIs sought to improve competition and create new contract vehicle(s) so that the current OCC system is not compromised in terms of quality for Veteran use. RFIs were issued on the following dates: July 7, 2021, October 6, 2021, and December 8, 2021. In the end, the findings resulted in the recompete strategy stated under section 11 of this J&A. This effort did not yield any additional sources that can meet the Government’s requirements under the current short-term acquisition strategy. Therefore, there is no competition anticipated for this acquisition. The proposed action will be synopsized on the Contract Opportunities Page per FAR 5.201.

Strategic Acquisition Center (SAC)

7. Fair and Reasonable Price Determination: No modification will be executed until the Contracting Officer determines any modified cost to the Master Price List (MPL) is fair and reasonable. As this is a supplemental modification to the base contract, the Government anticipates price increases on a minimum number of line items. For those increases the Government will determine those prices fair and reasonable in accordance with FAR 15.404. This determination will be based on a comparison of the current contract pricing, an Independent Government Cost Estimate, and other information as made available. Based on the Government historical prices for this requirement, the Contracting Officer anticipates the updated MPL cost will be fair and reasonable. Furthermore, a proposal analysis in accordance with FAR 15.404 will be accomplished at the Task Order level.

8. Market Research: With the opportunity to establish a new procurement approach and the exponential growth due to the COVID 19 pandemic, extensive market research was conducted. As detailed in section 6 of this J&A, a series of RFIs were issued to industry, resulting in the current recompete strategy, which will improve competition (long-term) while increasing small business participation.

Although this market research supports competition as a long-term strategy, a shorter-term sole-source award is necessary for the interim. Competition is not yet possible without the tremendous risk of mission failure and impact on Veterans during the pandemic.

Iron Bow Technologies, LLC has successfully supported VA in similar efforts and has been determined to be a responsible source with respect to performance. In addition, the Federal Awardee Performance and Integrity Information System (FAPIIS) was reviewed and FAPIIS shows no reports for Iron Bow Technologies, LLC that would indicate defective pricing, instances of contractor fault or recipient not- qualified, terminations for cause, default, material failure to comply, or non-responsibility of the contractor.

The NAICS code for this effort is 334111 Electronic Computer Manufacturing.

These are commercial products. The most applicable Product Service Code is 6515

– Medical and Surgical Instruments, Equipment, and Supplies.

9. Other Facts: There are no other supporting facts.

10.Sources Expressing Interest: Iron Bow Technologies, LLC, 2121 Cooperative Way STE 500 Herndon, Virginia 20171-5346

11. Actions to Remove Barriers to Future Competition: The OCC and SAC anticipates establishing three competitive contract vehicles for OCC's connected care technology network of equipment and services. Historically this contract was procured under one contract vehicle with a single awardee for ten years. Today this

Strategic Acquisition Center (SAC) contract works seamlessly through one contractor and requires extensive integration between several functional areas that support the Connected Care requirement. Due to the COVID-19 pandemic, expansive growth of the program occurred. As a result, VA revisited opportunities to restructure the existing contract, and determined the original requirement can be separated into smaller separate contract vehicles to provide for even more opportunities for competition. With the opportunity to establish a new procurement approach and the growth and changes in demand due to the COVID 19 pandemic, market research was conducted as detailed in the market research section of this document. The findings resulted in the anticipated recompete strategy and restructuring of the single contract into a potential three-separate-procurements for: Program Support Integration (PSI), Connected Care Integrated Network (CCIN), and Product Catalog (i.e., Equipment, Licensing, and Warranty). It is anticipated to set PSI aside for Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) based on the RFI process.

Additionally, it is intended to procure CCIN as a single-award indefinite-delivery contract vehicle providing for full and open competition. Lastly, it is anticipated to procure the Product Catalog as a multiple single-award contract vehicle approach providing full and open competition. Overall, these separate strategies are intended to remove barriers to future competition and increase the utilization of small businesses.

12.Technical and Requirements Certification: I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Signature: _________________________________ Date: ____________ Neil C. Evans, MD Chief Officer Office of Connected Care

13. Procuring Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.

Signature: _________________________________ Date: ____________ Wendy M. Minch Contracting Officer (AS-5A) Strategic Acquisition Center

Strategic Acquisition Center (SAC)

Concur

Based on the foregoing justification, I hereby approve this acquisition on an “other than full and open competition” basis pursuant to the statutory authority cited in paragraph four above, subject to availability of funds, and provided that the property and services herein described have otherwise been authorized for acquisition.

Signature: _________________________________ Date: ____________ Christopher D. Parker Associate Executive Director Strategic Acquisition Center (SAC) Contracting Activity

Approval

Based on the foregoing justification, I hereby approve this acquisition on an “other than full and open competition” basis pursuant to the statutory authority cited in paragraph four above, subject to availability of funds, and provided that the property and services herein described have otherwise been authorized for acquisition. As this action exceeds $75M, the certification below required by FAR 6.304 serves as approval.

Signature: _________________________________ Date: ____________ Angela Billups, Ph.D.

Executive Director Office of Acquisitions and Logistics, and Senior Procurement Executive recommend approval