[Federal Register Volume 61, Number 196 (Tuesday, October 8, 1996)]
[Rules and Regulations]
[Pages 52709-52710]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25568]


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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 837 and 852

RIN 2900-AG67


VA Acquisition Regulation: Service Contracting

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document, with a nonsubstantive change, adopts as a final 
rule the provisions of a proposal to amend the Department of Veterans 
Affairs (VA) Acquisition Regulation pertaining to ``SERVICE 
CONTRACTING'' and ``SOLICITATION PROVISIONS AND CONTRACT CLAUSES.'' The 
regulation is amended to implement a class deviation from the Federal 
Acquisition Regulation by establishing a modified clause for 
indemnification and medical liability insurance requirements applicable 
to VA contracts. The use of this clause, instead of the Federal 
Acquisition Regulation clause, is intended to ensure that contractors 
providing nonpersonal health-care services to VA are able to comply 
with State statutes and avoid excessive costs.

EFFECTIVE DATE: October 8, 1996.

FOR FURTHER INFORMATION CONTACT: Wanza Lewis, Acquisition Policy 
Division (95A), Office of Acquisition and Materiel Management, 
Department of Veterans Affairs, 810 Vermont Avenue, NW, Washington, DC 
20420, (202) 273-8820.

SUPPLEMENTARY INFORMATION: On October 22, 1993, we published in the 
Federal Register (58 FR 54548) a proposal to amend the Department of 
Veterans Affairs Acquisition Regulation to implement a class deviation 
from the Federal Acquisition Regulation Section 37.401 and clause at 
Section 52.237-7. Comments were solicited concerning the proposal for 
60 days, ending December 20, 1993. We did not receive any comments. The 
information presented in the proposed rule document still provides a 
basis for this final rule. Therefore, based on the rationale set forth 
in the proposed rule document, we are adopting the provisions of the 
proposed rule as a final rule without change, except for a 
nonsubstantive change which removes the designation of the material in 
Section 852.237-7 as a deviation.
    The Secretary hereby certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act (RFA), 5 U.S.C. 
601-612. This final rule would not cause a significant effect on any 
entities. Therefore, pursuant to 5 U.S.C. 605(b), this amendment is 
exempt from the initial and final regulatory flexibility analysis 
requirements of sections 603 and 604.

List of Subjects

48 CFR Part 837

    Government procurement.

48 CFR Part 852

    Government procurement, Reporting and recordkeeping requirements.

    Approved: September 25, 1996.
Jesse Brown,
Secretary of Veterans Affairs.

    For the reasons set forth in the preamble, 48 CFR parts 837 and 852 
are amended as set forth below:

PART 837--SERVICE CONTRACTING

    1. The authority citation for part 837 is revised to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).

    2. Subpart 837.4, section 837.403 is added to read as follows:

Subpart 837.4--Nonpersonal Health-Care Services


837.403   Contract clause.

    The contracting officer shall insert the clause at 852.237-7, 
Indemnification and Medical Liability Insurance, in lieu of FAR Clause 
52.237-7, in solicitations

[[Page 52710]]

and contracts for nonpersonal health-care services. The contracting 
officer may include the clause in bilateral purchase orders for 
nonpersonal health-care services awarded under the procedures in FAR 
part 13 and (VAAR) 48 CFR part 813.

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    3. The authority citation for part 852 continues to read as 
follows:

    Authority: 38 U.S.C. 501 and 40 U.S.C. 486(c).

    4. Section 852.237-7 is added to read as follows:


852.237-7   Indemnification and Medical Liability Insurance.

    As prescribed in 837.403, insert the following clause:

Indemnification and Medical Liability Insurance (October 1996)

    (a) It is expressly agreed and understood that this is a 
nonpersonal services contract, as defined in Federal Acquisition 
Regulation (FAR) 37.101, under which the professional services 
rendered by the Contractor or its health-care providers are rendered 
in its capacity as an independent contractor. The Government may 
evaluate the quality of professional and administrative services 
provided but retains no control over professional aspects of the 
services rendered, including by example, the Contractor's or its 
health-care providers' professional medical judgment, diagnosis, or 
specific medical treatments. The Contractor and its health-care 
providers shall be liable for their liability-producing acts or 
omissions. The Contractor shall maintain or require all health-care 
providers performing under this contract to maintain, during the 
term of this contract, professional liability insurance issued by a 
responsible insurance carrier of not less than the following 
amount(s) per specialty per occurrence: [Contracting Officer insert 
the dollar value(s) of standard coverage(s) prevailing within the 
local community as to the specific medical specialty, or 
specialties, concerned, or such higher amount as the Contracting 
Officer deems necessary to protect the Government's interests]. 
However, if the Contractor is an entity or a subdivision of a State 
that either provides for self-insurance or limits the liability or 
the amount of insurance purchased by State entities, then the 
insurance requirement of this contract shall be fulfilled by 
incorporating the provisions of the applicable State law.
    (b) An apparently successful offeror, upon request of the 
Contracting Officer, shall, prior to contract award, furnish 
evidence of the insurability of the offeror and/or of all health-
care providers who will perform under this contract. The submission 
shall provide evidence of insurability concerning the medical 
liability insurance required by paragraph (a) of this clause or the 
provisions of State law as to self-insurance, or limitations on 
liability or insurance.
    (c) The Contractor shall, prior to commencement of services 
under the contract, provide to the Contracting Officer Certificates 
of Insurance or insurance policies evidencing the required insurance 
coverage and an endorsement stating that any cancellation or 
material change adversely affecting the Government's interest shall 
not be effective until 30 days after the insurer or the Contractor 
gives written notice to the Contracting Officer. Certificates or 
policies shall be provided for the Contractor and/or each health-
care provider who will perform under this contract.
    (d) The Contractor shall notify the Contracting Officer if it, 
or any of the health- care providers performing under this contract, 
change insurance providers during the performance period of this 
contract. The notification shall provide evidence that the 
Contractor and/or health-care providers will meet all the 
requirements of this clause, including those concerning liability 
insurance and endorsements. These requirements may be met either 
under the new policy, or a combination of old and new policies, if 
applicable.
    (e) The Contractor shall insert the substance of this clause, 
including this paragraph (e), in all subcontracts for health-care 
services under this contract. The Contractor shall be responsible 
for compliance by any subcontractor or lower-tier subcontractor with 
the provisions set forth in paragraph (a) of this clause.

(End of Clause)

[FR Doc. 96-25568 Filed 10-7-96; 8:45 am]
BILLING CODE 8320-01-P