VA report calls for standardization of medical equipment service bids

April 10, 1991

A major revamping of the bidding process for medical imaging equipmentservice contracts at VA hospitals is imminent. The Office of theInspector General in the Department of Veterans Affairs produceda draft report last month recommending standardization

A major revamping of the bidding process for medical imaging equipmentservice contracts at VA hospitals is imminent. The Office of theInspector General in the Department of Veterans Affairs produceda draft report last month recommending standardization of bidspecifications for VA service work.

Standardization of bid requests will help prevent contractsthat favor OEMs over independent service organizations, said GlenBodis, an OIG auditor who helped develop the recommendations.

"We are recommending that all (VA) medical centers usea specification that is not restrictive and does not limit (service)awards to one specific contractor--in this case the OEM,"Bodis told SCAN.

The draft report is being circulated within the Departmentof Veterans Affairs for comment. A final version should be issuedwithin a month, Bodis said.

Initial reaction within the department appears favorable, accordingto Joel Cliff, staff assistant to Sen. H. John Heinz (R-PA). Heinzis a member of the Governmental Affairs Committee, which has executivebranch oversight responsibilities. Heinz's office initiated arequest to audit the VA service contracts on behalf of ImagingEquipment Services, a Pittsburgh ISO.

"One of the findings (of the OIG audit) was that specificationsin over half the cases were too restrictive in making VA awards,"Cliff said. "The (OIG) recommendation is that the biomedicaldivision (of the Department of Veterans Affairs) develop a standardperformance specification to be used for procurement at all VAhospitals."

IES is embroiled in litigation with Picker International overservice issues (SCAN 3/27/91). One of the smaller company's chargesagainst the imaging OEM involves Picker's alleged manipulationof VA bid specifications to block competition by ISOs. Etek, anotherISO battling Picker in court, made the same allegation (SCAN 1/30/91).

"I want to thank the senator and encourage other (ISOs)to get involved like this. This is a victory for third partiesand competition in government work," said Thomas Quinn, IESpresident.

Picker does not appear alarmed by potential changes in theVA service bidding process. Standardization of bids could actuallybe a welcome development, said Michael Peterson, Picker managerof public relations.

"If this is a move to make those bids consistent, it mightbe in order. It would make life a lot simpler for us. Local servicemanagers would all be singing out of the same song book,"he said.

Picker handles work with VA hospitals at the district level,so bids vary a great deal, said Thomas R. Shook, manager of nationalaccounts for Picker's equipment service business.

"That is where contracts are negotiated. We have our relationshipwith the government at that (district) level," he said.