VA rewrites contracts on Picker CT service

July 31, 1991

The Department of Veterans Affairs has acknowledged that VA specificationsfor maintenance contracts on Picker computed tomography scannersgive undue advantage to Picker in the service bidding process. The agency is writing new bid specifications for

The Department of Veterans Affairs has acknowledged that VA specificationsfor maintenance contracts on Picker computed tomography scannersgive undue advantage to Picker in the service bidding process.

The agency is writing new bid specifications for local VA hospitalsthat should open up the service business to independent providers,said Glen Bodis, an auditor with the Office of the Inspector Generalin the VA.

The VA accepted the recommendations of an OIG report on thePicker CT service work that the late Sen. H. John Heinz (R-PA)had requested. Heinz looked into the issue at the behest of ImagingEquipment Services, a Pennsylvania-based independent service organization.IES is involved with Picker in litigation over CT service issues.

IES is talking with a number of House and Senate committeesand hopes to have a Congressional investigation launched intoPicker's alleged influence on the bidding process at military,VA and other government hospitals, said Tom Quinn, IES president.

The OIG report may also serve to support the legal cases broughtagainst Picker by IES and Etek, a fellow ISO. Allegations thatPicker influenced the writing of VA bids to the detriment of ISOsare a part of both cases (SCAN 7/3/91).

Picker is in the process of evaluating the OIG report andformulating a response. "There are parts (of the report)we do not agree with," a Picker spokesperson said.

There were 62 Picker CT scanners installed at VA hospitalsas of August 1990, according to the report. The OIG evaluatedservice contracts on 36 of those systems and found that 21 containedrestrictive wording.

Picker won service contracts for 31 of the 62 scanners. Tencontracts were awarded to ISOs and the rest were either underwarranty or serviced by in-house technicians.

Bid restrictions mentioned in the OIG included requirementsthat:

  • Dunlee x-ray tubes be used as replacements (Dunleeis a Picker subsidiary);

  • service technicians be factory-trained by Picker; and

  • contractors possess Picker-copyrighted software. Thissoftware should be provided to all VA hospitals under the procurementcontracts, the report said.

The report also recommended that the VA purchase replacementtubes from both Picker and Eimac, a competing manufacturer, involume quantities to reduce costs.