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No-Bid Contracts and the Age of Transparency

Scott Honiberg and Jeffrey Weinstein, for HealthLeaders Media, May 10, 2010

So it was with more than a little interest that we noticed several months ago a very brief announcement in Federal Business Opportunities (the government's primary source of procurement information), about a sole source award for healthcare services coming out of the Executive Office of the President. The information indicated that the office was awarding a sole source contract for drug testing to a national laboratory firm. So of course we assumed in this new age of transparency this would be one of the times when the award would be thoroughly legitimate, fully transparent and fully documented.

We contacted two separate contracting personnel identified in the announcement and requested a copy of the J&A prepared by the government to justify the award. Two weeks later, after hearing nothing back, we sent another e-mail, this time enabling a request for a "Delivery" and "Read" receipt and again heard nothing back. We did a little more digging around and located the name and telephone number of another contracting person in the same office and decided we'd place a call and see if we could actually speck to someone. We left a voice mail with several ways to get in touch with us and we're still waiting to hear back from someone in that office.

While the examples above are clearly disturbing, we don't means to suggest that every J&A is an attempt to skirt requirements for competitive contracting. As we said earlier, there are many occasions when an award without competition is not only legal, but is absolutely legitimate. In spite of the examples above, there are some small, encouraging signs. As we also mentioned, the government is supposed to give companies a chance to submit qualifications before a proposed sole source award is actually made, so that it can actually compete a contract, if it is convinced that there is adequate competition.

We can confirm that recently, we have actually seen the government back-off plans for sole source awards, when it did receive information from organizations that made it clear there were other sources that could provide services in a cost-effective and timely fashion. So the lesson here is: if you learn about an opportunity that's proposed to be awarded without competition, submit your credentials and qualifications; you may be able to create a competitive opportunity when there otherwise would have been none.


Scott Honiberg is president and Jeff Weinstein is of counsel at Potomac Health Associates, Inc. They can be reached at S.Honiberg@PHAInc.com and J.Weinstein@PHAInc.com, respectively.
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