OFFICE OF THE ASSISTANT SECRETARY OF DEFENSE HEALTH AFFAIRS

Transcription

1 OFFICE OF THE ASSISTANT SECRETARY OF DEFENSE HEALTH AFFAIRS 7700 ARLINGTON BOULEVARD, SUITE 5101 FALLS CHURCH, VIRGINIA Defense Health Agency June 16, 2016 via Electronic Delivery General Counsel Government Accountability Office 441 G Street, NW Washington, DC Via protests@gao.gov Re: Protest of D.H. Porter Enterprises, LLC (dba Staffing Etc.) On Defense Health Agency Request for Quotations Number HT Q-0001, Protest B , Agency Response to SBA s Comments Defense Health Agency (DHA) respectfully responds to the Small Business Administration (SBA) comments as requested by the Government Accountability Office (GAO) Hearing Officer. According to the SBA, dated June 14, 2016, the Agency s finding of Protester s quote as being technically unacceptable was a finding of non-responsibility, requiring the Agency to refer this matter to the SBA for the Protester to apply for a Certificate of Competence (CoC). Specifically, the SBA found: The Agency s conclusion that Staffing Etc. is technically unacceptable because it is unable to obtain the necessary resources at the proposed labor rates is also a non-responsibility finding because it relates to the firm s ability to perform the contract. It does not matter how an agency labels a technical factor in an LPTA procurement. If the factor is assess to determine a firm s capability to perform the contract and the agency uses an acceptable/unacceptable basis to evaluate that factor, then it is a responsibility-like factor. If the offeror is a small business concern, a finding of technical unacceptability for a responsibility- 1

2 like factor in an LPTA procurement requires referral of the firm to SBA for the opportunity to apply for a COC. [cites deleted] (Emphasis added). SBA Comments at 4 However, this comment mischaracterizes the Agency s factor assessment, stating that the acceptable/unacceptable basis used to evaluate the factor was similar to a pass/fail, go/no go evaluation. SBA s comments appear to have been very influenced by the word, Unacceptable, regarding the Technical subfactor 1, which SBA erroneously took to mean a pass/fail scoring process. No such scoring was done in this case, and this characterization of the assessment is an inaccurate accounting of the Source Selection evaluation in this case. SBA s characterizations and the conclusions that it drew from them are clearly inconsistent with the language of the RFQ and the SSDD, which deemed the Protestor, Unacceptable for the Technical subfactor 1 based on an evaluation of its quote, consistent with the evaluation criteria in the RFQ. Specifically, both the applicable RFQ language and the Source Selection Decision Document (SSDD) indicate the evaluation was more than just a pass/fail determination. As noted in the SBA comment, the RFQ stated: Sub factor 1: Compensation Matrix. The Government will evaluate the proposed Compensation Matrix to determine the adequacy of the plan and particularly the hourly wage rate to be paid to health care providers (HCPs) at Walter Reed National Military Medical Center (WRNMMC), Bethesda, MD to successfully attract and retain qualified HCPs with minimum turnover. The Government will evaluate the rate paid to the individual HCP to ensure the rate is realistic in terms of impact upon attracting and retaining HCPs and is commensurate with hourly rates paid for similar health care providers in the local area. Compensation plan will be evaluated as realistic in terms of its impact upon recruitment and retention. A low compensation plan may be viewed as evidence of failure to comprehend the complexity of the contract requirements or appropriate compensation levels 2

3 of geographic area where performance will take place. (Emphasis added) AR File 002 at 117. The SSDD then stated that while the IGCE (the Independent Government Cost Estimate), which was developed based on a survey of the existing market rates paid to such healthcare providers (see AR Files ), was used as a basis for comparison for all proposals, the wage rates proposed were evaluated to ensure the hourly salary for the Anesthesiologists (were) realistic in terms of attracting and retaining these essential services for WRNMMC (Walter Reed National Military Medical Center) Department of Surgery. The conclusion drawn was that the Protester was rated as Unacceptable, because the rates were significant less than the IGCE s rates and because the salary rates proposed were the same for all labor categories and did not reflect a differential that would account for the specialized positions and their associated qualifications identified in the performance work statement and the risk of a breach in performance. AR File 008 at Thus, the SSDD clearly stated that there was no comparison of the rates to a pass/fail indicator to make the Acceptable/Unacceptable determination. Rather, the assessment was made after an assessment of the rates based on the fact that they were significantly less than the IGCE s rates and based on the fact that the rates did not reflect a differential that would account for the specialized positions and their associated qualifications identified in the performance work statement and the risk of a breach in performance. AR File 008, supra. In sum, the SSDD documented that the Protester s proposed compensation rates were evaluated as being unrealistic in terms of their impact upon recruitment and retention as stated in the RFQ. The determination was that the proposed rates, which were low, did not differentiate for the specialized positions, and were the same for all years, would impact the Protester s ability 3

4 to recruit and retain anesthesiologists. Such a low compensation plan was clearly evidenced that this Protester failed to comprehend the complexity of the contract requirements. Instead, the evidence, including the Protester s own rates on its current contract, indicated that this Protester was simply bidding a very low rate to buy in, with the hope of getting the contract, being unable to perform at the rate, and requesting a later modification to raise its rates to maintain the necessary full time equivalent anesthesiologists. It was for the combination of these reasons that the Protester s quote was determined technically Unacceptable, not due to a comparison to some go/no go indicator, as characterized in the SBA s comments which led to its erroneous conclusion. Finally, it should be noted that the RFQ was soliciting for an award under a pre-existing Federal Supply Schedule Contract with each of the Offerors in accordance with FAR 8.4, and the Protester is protesting the award of the Task Order to The Royster Group (TRG) under its VA FSS Contract V797P-7311A. See AR Files 001, 002. FAR (a) specifically states: Parts 13.., 14, 15, and 19 (except for the requirement at (e)(1)(iii)[acquisition for a bundled requirement not relevant in the current case] do not apply to orders placed against Federal Supply Schedules contracts (Emphasis added). Additionally, the General Services Administration (GSA) guidance (see 2_2.html), specifically states that it has completed a determination of responsibility at the Schedules contract level, ordering agencies are not required to conduct it at the order level. (Emphasis added). This GSA guidance also states, [p]rior to the award of a Schedule contract, the GSA Contracting Officer confirms that the prices of fixed-price services and hourly rates for services are fair and reasonable. The prices or discounts offered to GSA are compared with the prices or discounts offered by the company to its own commercial customers. Thus, the GSA 4

5 has already made the determination of whether this Protester is responsible and made that determination at contract level. In this case then, no additional referral is required, as the RFQ stated the Agency s intent to award this Task Order under FAR Part 8.4, and FAR 8.404(a) specifically excludes such Task Orders from the requirements stated in FAR 19. Therefore, as noted, the language of the RFQ and the SSDD stated that the finding of Unacceptability for the Protester in Technical Factor, subfactor 1 was unrealistic and evidenced the Protester s failure to understand the technical aspect and complexity of this contract and was not a mere pass/fail evaluation, as erroneously characterized by the SBA comments. Additionally, as this was a FAR 8 contract, there was no necessity to refer this Task Order award to the SBA for a COC as FAR 8.404(a) specifically excludes the requirements of FAR (a) and as any CoC determination requirement was already met at the award of the Schedule contract. IV. CONCLUSION For these reasons, DHA respectfully requests the protest be dismissed. Bridget E. Lyons David R. Smith Counsel for Defense Health Agency Cc: Counsel for Protester 5