Cardiothoracic Services Contracting at the Captain James A. Lovell Federal Health Care Center in North Chicago, Illinois, Needs Improvement

In January 2023, the VA Office of Inspector General (OIG) received a hotline allegation that Network Contracting Office (NCO) 12 participated in unethical sole-source contracting practices while procuring cardiothoracic services contracts at the Captain James A. Lovell Federal Health Care Center in North Chicago, Illinois, with a nonaffiliate contractor. The OIG referred the complaint to Regional Procurement Office (RPO) Central, the responsible VA office. RPO Central in March 2023 asked the Medical Sharing Office/Affiliate National Program Office (MSO) to determine whether contract reviews were circumvented. One month later, the MSO completed its investigation and found contracting officers made decisions that indicated a preference to avoid review processes and not maximize competition. Contracting officers also did not publicly post sole-source acquisition justifications as required. NCO 12 disagreed with the MSO’s findings.

The OIG reviewed whether NCO 12 participated in improper sole-source procurement and to determine whether the results of the MSO investigation were resolved. The OIG substantiated that NCO 12 avoided the MSO review process by regularly awarding short-term contracts since 2012 to avoid a lapse in service. Although NCO 12 did not violate VHA policy, the OIG found that contracting officials were not effective at ensuring their strategies for acquiring cardiothoracic services at Lovell were in the best interest of the government and in keeping with the latest VA clinical care standards.

Because RPO Central has not resolved the issues MSO identified, it did not comply with the requirement to maintain effective internal controls intended to support efficient operations. Unless RPO Central directs NCO 12 to submit contracts for MSO review, these practices may continue.

The OIG made four recommendations to correct the deficiencies identified and ensure the best interests of the government is served in contracting for cardiothoracic services at Lovell.