[Federal Register Volume 86, Number 12 (Thursday, January 21, 2021)]
[Proposed Rules]
[Pages 6281-6288]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-29196]


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DEPARTMENT OF VETERANS AFFAIRS

48 CFR Parts 852 and 873

RIN 2900-AQ78


VA Acquisition Regulation: Simplified Procedures for Health-Care 
Resources

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

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SUMMARY: The Department of Veterans Affairs (VA) is proposing to amend 
and update its VA Acquisition Regulation (VAAR) in phased increments to 
revise or remove any policy superseded by changes in the Federal 
Acquisition Regulation (FAR), to remove any procedural guidance 
internal to VA into the VA Acquisition Manual (VAAM), and to 
incorporate any new agency specific regulations or policies. These 
changes seek to streamline and align the VAAR with the FAR and remove 
outdated and duplicative requirements and reduce burden on contractors. 
The VAAM incorporates portions of the removed VAAR as well as other 
internal agency acquisition policy. VA will rewrite certain parts of 
the VAAR and VAAM, and as VAAR parts are rewritten, will publish them 
in the Federal Register. VA will combine related topics, as 
appropriate. This rulemaking revises VAAR coverage concerning 
Simplified Procedures for Health-Care Resources as well as an affected 
part concerning Solicitation Provisions and Contract Clauses.

DATES: Comments must be received on or before March 22, 2021 to be 
considered in the formulation of the final rule.

ADDRESSES: Comments may be submitted through www.Regulations.gov or 
mailed to Mr. Rafael Taylor, (003A2A), Department of Veterans Affairs, 
Procurement Policy and Warrant Management Services, 425 I Street NW, 
Room 1064, Washington, DC 20001. Comments should indicate that they are 
submitted in response to ``RIN 2900-AQ78--VA Acquisition Regulation: 
Simplified Procedures for Health-Care Resources.'' Comments received 
will be available at regulations.gov for public viewing, inspection or 
copies.

FOR FURTHER INFORMATION CONTACT: Mr. Rafael Taylor, Senior Procurement 
Analyst, Procurement Policy and Warrant Management Services, 003A2A, 
425 I Street NW, Washington, DC 20001, (202) 382-2787. (This is not a 
toll-free number.)

SUPPLEMENTARY INFORMATION: 

Background

    This rulemaking is issued under the authority of the Office of 
Federal Procurement Policy (OFPP) Act which provides the authority for 
an agency head to issue agency acquisition regulations that implement 
or supplement the FAR.
    VA is proposing to revise the VAAR to add new policy or regulatory 
requirements and to remove any redundant guidance and guidance that is 
applicable only to VA's internal operating processes or procedures. 
Codified acquisition regulations may be amended and revised only 
through rulemaking. All amendments, revisions and removals have been 
reviewed and concurred with by VA's Integrated Product Team of agency 
stakeholders.
    The VAAR uses the regulatory structure and arrangement of the FAR 
and headings and subject areas are consistent with FAR content. The 
VAAR is divided into subchapters, parts (each of which covers a 
separate aspect of acquisition), subparts, and sections.
    The Office of Federal Procurement Policy Act, as codified in 41 
U.S.C. 1707, provides the authority for the Federal Acquisition 
Regulation and for the issuance of agency acquisition regulations 
consistent with the FAR.
    When Federal agencies acquire supplies and services using 
appropriated funds, the purchase is governed by the FAR, set forth at 
Title 48 Code of Federal Regulations (CFR), chapter 1, parts 1 through 
53, and the agency regulations that implement and supplement the FAR. 
The VAAR is set forth at Title 48 CFR, chapter 8, parts 801 to 873.

Discussion and Analysis

    VA proposes to make the following changes to the VAAR in this phase 
of its revision and streamlining initiative. For procedural guidance 
cited below that is proposed to be deleted from the VAAR, each section 
cited for removal has been considered for inclusion in VA's internal 
agency operating procedures in accordance with FAR 1.301(a)(2). 
Similarly, delegations of authority that are removed from the VAAR will 
be included in the VAAM as internal departmental guidance. The VAAM is 
being created in parallel with these revisions to the VAAR and is not 
subject to the rulemaking process as they are internal VA procedures 
and guidance. The VAAM will not be finalized until corresponding VAAR 
parts are finalized, and therefore the VAAM is not yet available 
online.

VAAR Part 852--Solicitation Provisions and Contract Clauses

    We are proposing to revise the following provisions to make minor 
grammatical corrections and to capitalize all principal words in their 
titles: 852.273-70, Late Offers; 852.273-71, Alternative Negotiation 
Techniques; 852.273-72, Alternative Evaluation; 852.273-73, 
Evaluation--Health-Care Resources, and 852.273-74, Award Without 
Exchanges. The provisions 852.273-71, Alternative Negotiation 
Techniques, and 852.273-73, Evaluation--Health-Care Resources, are also 
amended to revise the citation in the first sentence to read 
``873.110(d).''

VAAR Part 873--Simplified Procedures for Health-Care Resources

    We propose to modify the title of part 873 by deleting the word 
``Acquisition'' to reflect more accurately the meaning of the statute 
(38 U.S.C. 8153). The title would then be ``Simplified Procedures for 
Health-Care Resources.'' This change avoids any misunderstanding that 
these acquisitions would be subject to FAR Part 13, Simplified 
Acquisition Procedures, and the corresponding part 813 in the VAAR.
    We also propose to revise the part 873 authorities to add 38 U.S.C. 
8127-8128, VA's unique authority as implemented under the Veterans 
First Contracting Program.
    We propose to replace the 38 U.S.C. 501 citation with 41 U.S.C. 
1702 which addresses the acquisition planning and management 
responsibilities of Chief Acquisition Officers and Senior Procurement 
Executives, to include implementation of unique procurement

[[Page 6282]]

policies, regulations, and standards of the executive agency.
    We propose to modify the citation 38 U.S.C. 8153 to 38 U.S.C. 8151-
8153 to correctly cite the complete authority of the statute.
    We propose to add the citation of 41 U.S.C. 1121(c)(3) which speaks 
to the authority of an executive agency under another law to prescribe 
policies, regulations, procedures, and forms for procurement that are 
subject to the authority conferred in the cited section, as well as 
other sections of Title 41 as shown therein.
    We also propose to add 41 U.S.C 1303, an updated positive law 
codification to reflect additional authority of the VA as an executive 
agency to issue regulations that are essential to implement 
Governmentwide policies and procedures in the agency, as well as to 
issue additional policies and procedures required to satisfy the 
specific needs of the VA.
    In 873.101, Policy, we propose to revise the single paragraph to 
explain more clearly the types of health-care resources that may be 
procured from VA-affiliated institutions under the authority of 38 
U.S.C. 7302, and to explain when and how such resources that are 
commercial services may be procured from sources that are not 
affiliated with the Department under 38 U.S.C. 7302.
    In 873.102, Definitions, we propose to revise the definition of 
``Commercial service'' to remove the phrase ``except construction 
exceeding $2,000 and architect-engineer services'' since it is not a 
limitation contained in 38 U.S.C. 8153.
    We propose to revise 873.103, Priority sources, by removing the 
unnecessary phrase ``Without regard to FAR 8.002(a)(2)'' in the first 
sentence. We also propose to add a statement regarding the 
applicability of 38 U.S.C. 8127(d) to this part by inserting a 
reference to revised policy regarding the priority of AbilityOne 
covered services as a mandatory source set forth at 808.002 (a)(2) 
(which implements Pub. L. 116-155, the Department of Veterans Affairs 
Contracting Preference Consistency Act of 2020). AbilityOne covered 
services remain a priority source under VAAR part 873 as set forth in 
808.002(a)(2). We also propose to insert a reference to 873.107, 
Socioeconomic programs.
    In VAAR section 873.104, Competition requirements, we propose to 
clarify that health-care resources may be acquired on a sole source 
basis from an institution affiliated with the Department under 38 
U.S.C. 7302 if the resource is a commercial service, the use of medical 
equipment or space, or research. Such sole source contracts are not 
required to be publicized as required by FAR 5.101, nor do they require 
written justification under 41 U.S.C. 3304(e) or under FAR part 6. It 
would also clarify that when acquiring health-care resources from 
institutions or organizations not affiliated with the VA, then the 
Department shall permit all responsible sources, as appropriate, to 
submit a bid, proposal, or quotation for the resources to be procured 
and to provide for the consideration by the Department of bids, 
proposals, or quotations so submitted. Such actions shall also be 
publicized as otherwise required by VAAR section 873.108.
    We propose to revise VAAR section 873.105, Acquisition planning, to 
delete the first paragraph as unnecessary; to redesignate the remaining 
paragraphs as (a), (b), and (c); to limit the need to assemble an 
acquisition team to those actions with non-affiliated sources described 
in VAAR section 873.104(b); and to comply with the requirements of the 
Veterans First preferences in VAAR subpart 819.70 and section 873.103 
when performing market research.
    We propose to revise the title of VAAR section 873.106 to read 
``Exchanges with industry before receipt of proposals.'' We also 
propose to remove the reference to FAR part 10 as unnecessary, to add a 
sentence requiring that any exchange of information must be consistent 
with procurement integrity requirements in FAR 3.104, to replace the 
name ``Central Contractor Registration'' with that of the current 
system, ``System for Award Management,'' and to require research of the 
VA's Vendor Information Pages (VIP) database to help identify potential 
VIP-listed and verified Veteran-owned small business concerns.
    In section 873.107, Socioeconomic programs, we propose to revise 
and clarify the policy set forth in this section to require 
implementation of the VA Rule of Two in accordance with VAAR subpart 
819.70, and make necessary clarifications regarding priority sources 
and application of other small business programs. These clarifications 
and revisions are necessary to fully implement the requirements under 
various U.S. Federal court cases and new legislation, including the 
U.S. Supreme Court decision of June 16, 2016, in Kingdomware 
Technologies, Inc. v. United States, and the recently enacted Public 
Law 116-155, the Department of Veterans Affairs Contracting Preference 
Consistency Act of 2020, signed on August 8, 2020.
    We propose to modify section 873.108, Publicizing contract actions, 
to require publication of only competitive acquisitions, to delete a 
reference to part 813 to avoid confusion, to remove repetitive language 
from section 873.104(a), and to make other minor edits.
    In VAAR section 873.109, General requirements for acquisition of 
health-care resources, we propose to revise the section to conform to 
the requirement of the deviation ``Class deviation from VA Acquisition 
Regulation (VAAR) 815.303--Responsibilities,'' of December 15, 2016, 
designating the contracting officer to be the Source Selection 
Authority (SSA) unless the HCA has appointed another person to perform 
that role; to refer to both Performance Work Statements and Statements 
of Work when discussing ``specifications;'' and to correct a cross 
reference to read ``873.111(d)(1)(ii).''
    We propose to revise section 873.110, Solicitation provisions, to 
capitalize all clauses and provisions referenced in the section; to 
revise paragraph (a) to clarify the basis for using provision 852.271-
70, Late Offers, in solicitations; to correct the reference in (b) to 
``Alternative Negotiation Techniques'' to cite ``873.111(d)(1),'' and 
the reference in (c) to ``873.111(d)(1)(ii);'' to revise paragraphs (d) 
and (e) to incorporate the appropriate capitalization of the 
provisions; and to remove from (f) the prescription of clause 852.207-
70, Report of Employment Under Commercial Activities, as that clause is 
obsolete since the A-76 program is not currently effective.
    In section 873.111, Acquisition strategies for health-care 
resources, we propose to make several minor edits to the text; to 
remove the opening phrase ``Without regard to FAR 13.003 or 
13.500(a),'' as unnecessary; to insert the acronym ``RFQ'' and the word 
``subparts'' paragraph (a)(1); to change the spelling of the word 
``Part'' in (a)(2) to lower case; to delete existing paragraph (c) as 
unnecessary; and to redesignate the remaining paragraphs as (c) and 
(d).
    We propose to revise section 873.113, Exchanges with offerors, to 
delete in paragraph (c) the repetitive use of the word ``perceived;'' 
and to correct the citation in paragraph (e) to 873.111(d)(1) regarding 
alternative negotiation techniques.
    We propose to make two minor edits to the last sentence in 
paragraph (a) in 873.115, Proposal revisions, to insert the word 
``all'' after the word ``safeguard'' to stress the need for protecting 
proposals and revisions, and to delete as unnecessary the word 
``thereto.''
    In section 873.116, Source selection decision, we propose to 
replace the term

[[Page 6283]]

``contracting officer'' in paragraphs (a) and (b) with ``Source 
Selection Authority'' or ``SSA'' to be consistent with the deviation 
``Class deviation from VA Acquisition Regulation (VAAR) 815.303--
Responsibilities,'' of December 15, 2016, and to remove from paragraph 
(c) the reference to section 815.308 since that section does not exist.
    In section 873.118, Debriefings, we propose to revise the first 
sentence to read ``Offerors whose proposals are not accepted under a 
competitive request for proposals (RFP) may submit a written request 
for a debriefing to the contracting officer.'' The current language 
uses non-standard acquisition terms.

Executive Orders 12866, 13563 and 13771

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). E.O. 13563 (Improving Regulation and Regulatory Review) 
emphasizes the importance of quantifying both costs and benefits, 
reducing costs, harmonizing rules, and promoting flexibility. The 
Office of Information and Regulatory Affairs has determined that this 
rule is not a significant regulatory action under Executive Order 
12866.
    VA's impact analysis can be found as a supporting document at 
http://www.regulations.gov, usually within 48 hours after the 
rulemaking document is published. Additionally, a copy of the 
rulemaking and its impact analysis are available on VA's website at 
http://www.va.gov/orpm/, by following the link for ``VA Regulations 
Published From FY 2004 Through Fiscal Year to Date.''
    This proposed rule is not expected to be an E.O. 13771 regulatory 
action because this proposed rule is not significant under E.O. 12866.

Paperwork Reduction Act

    This proposed rule contains no provisions constituting a collection 
of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3521).

Regulatory Flexibility Act

    The Secretary hereby certifies that this proposed rule would not 
have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act (5 
U.S.C. 601-612).
    This rulemaking does not change VA's policy regarding small 
businesses, does not have an economic impact to individual businesses, 
and there are no increased or decreased costs to small business 
entities. On this basis, the proposed rule would not have an economic 
impact on a substantial number of small entities as they are defined in 
the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, pursuant 
to 5 U.S.C. 605(b), the initial and final regulatory flexibility 
analysis requirements of 5 U.S.C. 603 and 604 do not apply.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal Governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This proposed rule will have no such effect 
on State, local, and tribal Governments or on the private sector.

List of Subjects

48 CFR Part 852

    Government procurement, Reporting and recordkeeping requirements.

48 CFR Part 873

    Government procurement.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. Brooks D. 
Tucker, Assistant Secretary for Congressional and Legislative Affairs, 
Performing the Delegable Duties of the Chief of Staff, Department of 
Veterans Affairs, approved this document on July 17, 2020, for 
publication.

Consuela Benjamin,
Regulations Development Coordinator, Office of Regulation Policy & 
Management, Office of the Secretary, Department of Veterans Affairs.

    For the reasons set out in the preamble, VA proposes to amend 48 
CFR parts 852 and 873 as follows:

PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
1. The authorities for part 852 continue to read as follows:

    Authority: 38 U.S.C. 8127-8128, and 8151-8153; 40 U.S.C. 121(c); 
41 U.S.C. 1121(c)(3); 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR 
1.301-1.304.

Subpart 852.2--Text of Provisions and Clauses

0
2. Section 852.273-70 is revised to read as follows:


852.273-70  Late Offers.

    As prescribed in 873.110(a), insert the following provision:

LATE OFFERS (DATE)

    This provision replaces paragraph (f) of FAR provision 52.212-1, 
Instructions to Offerors--Commercial Items. Offers or modifications 
of offers received after the time set forth in a request for 
quotations or request for proposals may be considered, at the 
discretion of the Contracting Officer, if determined to be in the 
best interest of the Government. Late bids submitted in response to 
an invitation for bid (IFB) will not be considered.


(End of provision)
0
3. Section 852.273-71 is revised to read as follows:


852.273-71  Alternative Negotiation Techniques.

    As prescribed in 873.110(b), insert the following provision:

ALTERNATIVE NEGOTIATION TECHNIQUES (DATE)

    The Contracting Officer may elect to use the alternative 
negotiation techniques described in 873.111(d) in conducting this 
procurement. If used, Offerors may respond by maintaining offers as 
originally submitted, revising offers, or submitting an alternative 
offer. The Government may consider initial offers unless revised or 
withdrawn, revised offers, and alternative offers in making the 
award. Revising an offer does not guarantee an offeror an award.


(End of provision)
0
4. Section 852.273-72 is revised to read as follows:


852.273-72  Alternative Evaluation.

    As prescribed in 873.110(c), insert the following provision:

ALTERNATIVE EVALUATION (DATE)

    (a) The Government will award a contract resulting from this 
solicitation to the responsible Offeror submitting the lowest priced 
offer that conforms to the solicitation. During the specified period 
for receipt of offers, the amount of the lowest offer will be posted 
and may be viewed by [Contracting Officer insert description of how 
the information may be viewed electronically or

[[Page 6284]]

otherwise]. Offerors may revise offers anytime during the specified 
period. At the end of the specified time period for receipt of 
offers, the responsible Offeror submitting the lowest priced offer 
will be in line for award.
    (b) Except when it is determined not to be in the Government's 
best interest, the Government will evaluate offers for award 
purposes by adding the total price for all options to the total 
price for the basic requirement. The Government may determine that 
an offer is unacceptable if the option prices are materially 
unbalanced. Evaluation of options shall not obligate the Government 
to exercise the option(s).


(End of provision)
0
5. Section 852.273-73 is revised to read as follows:


852.273-73  Evaluation--Health-Care Resources.

    As prescribed in 873.110(d), in lieu of FAR provision 52.212-2, the 
Contracting Officer may insert a provision substantially as follows:

EVALUATION--HEALTH-CARE RESOURCES (DATE)

    (a) The Government will award a contract resulting from this 
solicitation to the responsible Offeror whose proposal, conforming 
to the solicitation, will be most advantageous to the Government, 
price and other factors considered. The following information or 
factors shall be used to evaluate offers: [Contracting Officer 
insert evaluation information or factors, such as technical 
capability to meet the Government's requirements, past performance, 
or such other evaluation information or factors as the Contracting 
Officer deems necessary to evaluate offers. Price must be evaluated 
in every acquisition. The Contracting Officer may include the 
evaluation information or factors in their relative order of 
importance, such as in descending order of importance. The relative 
importance of any evaluation information must be stated in the 
solicitation.]
    (b) Except when it is determined not to be in the Government's 
best interest, the Government will evaluate offers for award 
purposes by adding the total price for all options to the total 
price for the basic requirement. The Government may determine that 
an offer is unacceptable if the option prices are materially 
unbalanced. Evaluation of options shall not obligate the Government 
to exercise the option(s). The Government may reject any or all 
proposals if such action is in the Government's interest. 
Additionally, the Government may waive informalities and minor 
irregularities in proposals received.
    (c) If this solicitation is a request for proposals (RFP), a 
written notice of award or acceptance of a proposal, mailed or 
otherwise furnished to the successful Offeror within the time for 
acceptance specified in the solicitation, shall result in a binding 
contract without further action by either party. Before the 
proposal's specified expiration time, the Government may accept a 
proposal (or part of a proposal), whether or not there are 
negotiations after its receipt, unless a written notice of 
withdrawal is received by the Contracting Officer before award.


(End of provision)
0
6. Section 852.273-74 is revised to read as follows:


852.273-74  Award Without Exchanges.

    As prescribed in 873.110(e), insert the following provision:

AWARD WITHOUT EXCHANGES (DATE)

    The Government intends to evaluate proposals and award a 
contract without exchanges with Offerors. Therefore, each initial 
proposal should contain the Offeror's best terms from a cost or 
price and technical standpoint. However, the Government reserves the 
right to conduct exchanges if later determined by the Contracting 
Officer to be necessary.

0
7. Part 873 is revised to read as follows:

PART 873--SIMPLIFIED PROCEDURES FOR HEALTH-CARE RESOURCES

Sec.
873.101 Policy.
873.102 Definitions.
873.103 Priority sources.
873.104 Competition requirements.
873.105 Acquisition planning.
873.106 Exchanges with industry before receipt of proposals.
873.107 Socioeconomic programs.
873.108 Publicizing contract actions.
873.109 General requirements for acquisition of health-care 
resources.
873.110 Solicitation provisions.
873.111 Acquisition strategies for health-care resources.
873.112 Evaluation information.
873.113 Exchanges with offerors.
873.114 Best value pool.
873.115 Proposal revisions.
873.116 Source selection decision.
873.117 Award to successful offeror.
873.118 Debriefings.

    Authority: 38 U.S.C. 8127-8128; 38 U.S.C. 8151-8153; 40 U.S.C. 
121(c); 41 U.S.C. 1121(c)(3); 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 
CFR 1.301-1.304.


873.101  Policy.

    (a) General. In accordance with 38 U.S.C. 8153, to secure health-
care resources which otherwise might not be feasibly available, or to 
effectively utilize certain other health-care resources, the Department 
of Veterans Affairs (VA) may make arrangements by contract for the 
mutual use, or exchange of use, of health-care resources between VA 
health-care facilities and any health-care provider, or other entity or 
individual. This part prescribes simplified procedures for contracts 
with entities not affiliated with VA under 38 U.S.C. 7302 to secure 
health-care resources that are a commercial service, or the use of 
medical equipment or space. VA may enter into such a contract if such 
resources are not, or would not be, used to their maximum effective 
capacity. (38 U.S.C. 8153)
    (b) Precedence. These procedures shall be used in conjunction with 
the Federal Acquisition Regulation (FAR) and other parts of the VAAR. 
However, when a policy or procedure in the FAR or another part of the 
VAAR is inconsistent with the procedures contained in this part, this 
part shall take precedence. (38 U.S.C. 8153)


873.102   Definitions.

    Commercial service means a service that is offered and sold 
competitively in the commercial marketplace, is performed under 
standard commercial terms and conditions, and is procured using firm-
fixed price contracts. (38 U.S.C. 8153)
    Health-care providers include health-care plans and insurers and 
any organizations, institutions, or other entities or individuals who 
furnish health-care resources. (38 U.S.C. 8153)
    Health-care resource includes hospital care and medical services 
(as those terms are defined in 38 U.S.C. 1701 and services under 
sections 1782 and 1783 of this title) any other health-care service, 
and any health-care support or administrative resource. (38 U.S.C. 
8152)


873.103  Priority sources.

    Except for the acquisition of covered services available from the 
Committee for Purchase From People Who Are Blind or Severely Disabled 
and the AbilityOne Program (see FAR subpart 8.7), there are no priority 
sources for the acquisition of health-care resources consisting of 
commercial services or the use of medical equipment or space in 
accordance with 808.002(a)(2) and 873.107. (38 U.S.C. 8153)


873.104  Competition requirements.

    (a) Affiliated institutions. (1) A health-care resource may be 
acquired on a sole source basis if a commercial service, the use of 
medical equipment or space, or research, and is to be acquired from an 
institution affiliated with the VA in accordance with 38 U.S.C. 7302, 
including medical practice groups and other entities associated with 
affiliated institutions, blood banks, organ banks, or research centers. 
(38 U.S.C. 8153(a)(3)(A))
    (2) Acquisitions of health-care resources identified in paragraph 
(a)(1) of this section are not required to be publicized as otherwise 
required by 873.108 or FAR 5.101.
    (b) Non-affiliated entities. (1) If the health-care resource 
required is a

[[Page 6285]]

commercial service or the use of medical equipment or space, and is to 
be acquired from an entity not described in paragraph (a)(1) of this 
section, contracting officers shall permit all responsible sources, as 
appropriate, to submit a bid, proposal, or quotation for the resource 
to be procured, and provide for the consideration by VA of bids, 
proposals, or quotations so submitted. (38 U.S.C. 8153(a)(3)(B))
    (2) Acquisition of health-care resources identified in paragraph 
(b)(1) of this section shall be publicized as otherwise required by 
873.108. Moreover, for any such acquisition described in paragraph 
(b)(1) of this section to be conducted on a sole source basis, the 
contracting officer must prepare a justification that includes the 
information and is approved at the levels prescribed in FAR part 6.303. 
(38 U.S.C. 8153(a)(3)(D))


873.105  Acquisition planning.

    (a) For the acquisition of health-care resources consisting of 
commercial services or the use of medical equipment or space from non-
affiliated institutions as described in 873.104(b), where the 
acquisition is expected to exceed the simplified acquisition threshold 
(SAT), an acquisition team must be assembled. The team shall be 
tailored by the contracting officer for each particular acquisition 
expected to exceed the SAT. The team should consist of a mix of staff, 
appropriate to the complexity of the acquisition, and may include 
fiscal, legal, administrative, and technical personnel, and such other 
expertise as necessary to assure a comprehensive acquisition plan. The 
team should include the small business advocate representing the 
contracting activity or a higher-level designee. At a minimum, the team 
must include the contracting officer and a representative of the Office 
of General Counsel and the requesting service. (38 U.S.C. 8153)
    (b) The contracting officer or the acquisition team, as 
appropriate, must conduct market research, including satisfying the 
requirements of VAAR 808.002(a)(2) and 873.107, Socioeconomic programs, 
and a VA Rule of Two determination. It is the responsibility of the 
contracting officer to ensure the requirement is appropriately 
publicized and information about the procurement opportunity is 
adequately disseminated as set forth in 873.107. (38 U.S.C. 8153)
    (c) In lieu of the requirements of FAR part 7 addressing 
documentation of the acquisition plan, the contracting officer may 
conduct an acquisition strategy meeting with cognizant offices to seek 
approval for the proposed acquisition approach. If a meeting is 
conducted, briefing materials shall be presented to address the 
acquisition plan topics and structure in FAR 7.105. Formal written 
minutes--summarizing decisions, actions, and conclusions--shall be 
prepared and included in the contract file, along with a copy of the 
briefing materials. (38 U.S.C. 8153)


873.106  Exchanges with industry before receipt of proposals.

    (a) Exchange of information among all interested parties involved 
in an acquisition described in 873.104(b), from the earliest 
identification of a requirement through release of the solicitation, is 
encouraged. Any exchange of information must be consistent with 
procurement integrity requirements in FAR 3.104. The nature and extent 
of exchanges between the Government and industry shall be a matter of 
the contracting officer's discretion (for acquisitions not exceeding 
the simplified acquisition threshold) or the acquisition team's 
discretion, as coordinated by the contracting officer. (38 U.S.C. 8153)
    (b) Techniques to promote early exchange of information include--
    (1) Industry or small business conferences;
    (2) Public hearings;
    (3) Market research in accordance with FAR 10.002(b), which shall 
be followed to the extent that the provisions therein would provide 
relevant information;
    (4) One-on-one meetings with potential offerors;
    (5) Presolicitation notices;
    (6) Draft requests for proposals (RFPs);
    (7) Requests for information (RFIs);
    (8) Presolicitation or preproposal conferences;
    (9) Site visits;
    (10) Electronic notices (e.g., internet); and
    (11) Use of the System for Award Management (SAM) (see http://www.sam.gov/.
    (12) Researching VA's Vendor Information Pages (VIP) database at 
https://www.vip.vetbiz.va.gov/.


873.107  Socioeconomic programs.

    (a) The Veterans First Contracting Program in VAAR subpart 819.70 
takes precedence over other small business programs. (38 U.S.C. 8127-
8128)
    (b)(1) Except for contract actions subject to 808.002(a)(2), 
competitive contract actions not otherwise excluded under this part 
shall be set-aside for VIP-listed service-disabled veteran-owned small 
business (SDVOSB) concerns or veteran-owned small business (VOSB) 
concerns if the contracting officer has a reasonable expectation that 
two or more eligible small business concerns owned and controlled by 
Veterans will submit offers and that the award can be made at a fair 
and reasonable price that offers best value to the United States. (38 
U.S.C. 8127-8128)
    (2) The contracting officer shall proceed with the acquisition 
under the simplified procedures of this part considering priority 
sources (see 808.008(a)(2) and 873.103) and preferences for other small 
businesses in accordance with 819.203-70 and 819.7004. (38 U.S.C. 8153)
    (c) Without regard to FAR 13.003(b)(1), 19.203, 19.502, the head of 
the contracting activity (HCA) may approve a waiver from the 
requirement for any set-aside for small business participation when a 
waiver is determined to be in the best interest of the Government. (38 
U.S.C. 8153)
    (d) The contracting officer shall ensure priorities for veteran-
owned small businesses are implemented within the VA hierarchy of small 
business program preferences, established by 38 U.S.C. 8127 and 8128, 
as implemented in VAAR subpart 819.70, the Veterans First Contracting 
Program. Specifically, the contracting officer shall consider 
preferences for verified service-disabled veteran-owned small 
businesses (SDVOSBs) first, then preferences for verified veteran-owned 
small businesses (VOSBs). These priorities will be followed by 
preferences for other small business concerns in accordance with FAR 
19.203, 819.203-70 and 819.7004. (38 U.S.C. 8153)


873.108  Publicizing contract actions.

    (a) All competitive acquisitions under this part, except as 
provided in paragraph (b) of this section, for dollar amounts in excess 
of the SAT, shall be publicly announced utilizing a medium designed to 
permit all responsible sources, as appropriate under the provisions of 
this part, to submit a bid, proposal, or quotation (as appropriate).
    (1) The publication medium may include the internet, including the 
Governmentwide point of entry (GPE), and local, regional or national 
publications or journals, as appropriate, at the discretion of the 
contracting officer, depending on the complexity of the acquisition.
    (2) Notice shall be published for a reasonable time prior to 
issuance of a solicitation, depending on the complexity or urgency of 
the acquisition, in order to afford potential offerors a reasonable 
opportunity to respond. If the notice includes a

[[Page 6286]]

complete copy of the RFQ or solicitation, a prior notice is not 
required, and the RFQ or solicitation shall be considered to be 
announced and issued at the same time.
    (3) The notice may include contractor qualification parameters, 
such as time for delivery of service, credentialing or medical 
certification requirements, small business or other socio-economic 
preferences, the appropriate small business size standard, and such 
other qualifications as the contracting officer deems necessary to meet 
the needs of the Government. (38 U.S.C. 8153)
    (b) The requirement for public announcement does not apply to sole 
source acquisitions described in 873.104(a). However, as required by 38 
U.S.C. 8153(a)(3)(D), acquisitions from an institution not affiliated 
with the Department in accordance with 38 U.S.C. 7302, if conducted on 
a sole source basis, must still be justified and publicized (see 
873.104(b)(2)). (38 U.S.C. 8153)
    (c) For acquisitions below the SAT, a public announcement is 
optional. (38 U.S.C. 8153)
    (d) Each solicitation issued under these procedures must 
prominently identify that the requirement is being solicited under the 
authority of 38 U.S.C. 8153 and part 873. (38 U.S.C. 8153)


873.109  General requirements for acquisition of health-care resources.

    (a) Source selection authority. Unless the head of the contracting 
activity (HCA) appoints another individual to serve as the Source 
Selection Authority (SSA), the contracting officer shall be the SSA for 
acquisitions of health-care resources, consisting of commercial 
services, or the use of medical equipment or space, utilizing the 
guidance contained in this part 873. (38 U.S.C. 8153)
    (b) Performance Work Statement/Statement of Work. The performance 
work statement (PWS) or statement of work (SOW) must define the 
requirement and should, in most instances, include qualifications or 
limitations such as time limits for delivery of service, medical 
certification or credentialing restrictions, and small business or 
other socio-economic preferences. The contracting officer may include 
any other such terms as the contracting officer deems appropriate for 
each specific acquisition. (38 U.S.C. 8153)
    (c) Documentation. Without regard to FAR 13.106-3(b), 13.501(b), or 
15.406-3, the contract file must include--
    (1) A brief written description of the procedures used in awarding 
the contract;
    (2) A written determination that the health-care resources being 
procured are not otherwise feasibly available or that utilization of 
such health-care resources is necessary to meet mission requirements;
    (3) Documentation of market research and the results of such 
research;
    (4) The number of offers received; and
    (5) An explanation, tailored to the size and complexity of the 
acquisition, of the basis for the contract award decision. (38 U.S.C. 
8153)
    (d) Time for receipt of quotations or offers. (1) Without regard to 
FAR 5.203, contracting officers shall set a reasonable time for receipt 
of quotations or proposals in the solicitations.
    (2) Without regard to FAR 15.208 or 52.212-1(f), quotations or 
proposals received after the time set forth in an RFQ or request for 
proposals (RFP) may be considered at the discretion of the contracting 
officer if determined to be in the best interest of the Government. 
Contracting officers must document the rationale for accepting 
quotations or proposals received after the time specified in the RFQ or 
RFP. This paragraph (d)(2) shall not apply to RFQs or RFPs if 
alternative evaluation techniques described in 873.111(d)(1)(ii) are 
used. This paragraph (d)(2) does not apply to invitations for bid 
(IFBs). (38 U.S.C. 8153)
    (e) Cancellation of procurements. Any acquisition may be canceled 
by the contracting officer at any time during the acquisition process 
if cancellation is determined to be in the best interest of the 
Government and a memorandum for the record in included in the 
solicitation file explaining the reasons for the cancellation. (38 
U.S.C. 8153)


873.110  Solicitation provisions.

    (a) As required in 873.109(d), contracting officers shall set a 
reasonable time for receipt of quotations or proposals and shall insert 
the provision at 852.273-70, Late Offers, in all RFQs and RFPs 
exceeding the micro-purchase threshold. However, this provision shall 
not be used if the provision 852.273-71, Alternative Negotiation 
Techniques, is to be used. (38 U.S.C. 8153)
    (b) The contracting officer shall insert a provision in RFQs and 
solicitations, substantially the same as the provision at 852.273-71, 
Alternative Negotiation Techniques, when either of the alternative 
negotiation techniques described in 873.111(d)(1) will be used. (38 
U.S.C. 8153)
    (c) The contracting officer shall insert the provision at 852.273-
72, Alternative Evaluation, in lieu of the provision at 52.212-2, 
Evaluation--Commercial Items, when the alternative negotiation 
technique described in 873.111(d)(1)(ii) will be used. (38 U.S.C. 8153)
    (d) When evaluation information, as described in 873.112, is to be 
used to select a contractor under a RFQ or RFP for health-care 
resources consisting of commercial services or the use of medical 
equipment or space, the contracting officer may insert the provision at 
852.273-73, Evaluation--Health-Care Resources, in the RFQ or RFP in 
lieu of FAR provision 52.212-2. (38 U.S.C. 8153)
    (e) As provided at 873.113(f), if award may be made without 
exchange with offerors, the contracting officer shall include the 
provision at 852.273-74, Award Without Exchanges, in the RFQ or RFP. 
(38 U.S.C. 8153)
    (f) The contracting officer shall insert the FAR clause at 52.207-
3, Right of First Refusal of Employment, in all RFQs, solicitations, 
and contracts issued under the authority of 38 U.S.C. 8151-8153 which 
may result in a conversion, from in-house performance to contract 
performance, of work currently being performed by Department of 
Veterans Affairs employees. (38 U.S.C. 8153)


873.111  Acquisition strategies for health-care resources.

    The following acquisition processes and techniques may be used, 
singly or in combination with others, as appropriate, to design 
acquisition strategies suitable for the complexity of the requirement 
and the amount of resources available to conduct the acquisition. These 
strategies should be considered during acquisition planning. The 
contracting officer shall select the process most appropriate to the 
particular acquisition. There is no preference for sealed bid 
acquisitions. (38 U.S.C. 8153)
    (a) Request for quotations (RFQ). (1) Without regard to FAR 
subparts 6.1 or 6.2, contracting officers must solicit a sufficient 
number of sources to promote competition to the maximum extent 
practicable and to ensure that the purchase is advantageous to the 
Government, based, as appropriate, on either price alone or price and 
other factors (e.g., past performance and quality). RFQs must notify 
vendors of the basis upon which the award is to be made. (see FAR 
13.004)
    (2) For acquisitions in excess of the SAT, the procedures set forth 
in FAR part 13 concerning RFQs may be utilized without regard to the 
dollar

[[Page 6287]]

thresholds contained therein. (38 U.S.C. 8153)
    (b) Sealed bidding. FAR part 14 provides procedures for sealed 
bidding.
    (c) Multiphase acquisition technique. (1) General. Without regard 
to FAR 15.202, multiphase acquisitions may be appropriate when the 
submission of full proposals at the beginning of an acquisition would 
be burdensome for offerors to prepare and for Government personnel to 
evaluate. Using multiphase techniques, the Government may seek limited 
information initially, make one or more down-selects, and request a 
full proposal from an individual offeror or limited number of offerors. 
Provided that the notice notifies offerors, the contracting officer may 
limit the number of proposals during any phase to the number that will 
permit an efficient competition among proposals offering the greatest 
likelihood of award. The contracting officer may indicate in the notice 
an estimate of the greatest number of proposals that will be included 
in the down-select phase. The contracting officer may down-select to a 
single offeror. (38 U.S.C. 8153)
    (2) First phase notice. In the first phase, the Government shall 
publish a notice (see 873.108) that solicits responses and that may 
provide, as appropriate, a general description of the scope or purpose 
of the acquisition and the criteria that will be used to make the 
initial down-select decision. The notice may also inform offerors of 
the evaluation criteria or process that will be used in subsequent 
down-select decisions. The notice must contain sufficient information 
to allow potential offerors to make an informed decision about whether 
to participate in the acquisition. The notice must advise offerors that 
failure to participate in the first phase will make them ineligible to 
participate in subsequent phases. The notice may be in the form of a 
synopsis in the Governmentwide point of entry (GPE) or a narrative 
letter or other appropriate method that contains the information 
required by this paragraph. (38 U.S.C. 8153)
    (3) First phase responses. Offerors shall submit the information 
requested in the notice described in paragraph (d)(2) of this section. 
Information sought in the first phase may be limited to a statement of 
qualifications and other appropriate information (e.g., proposed 
technical concept, past performance information, limited pricing 
information). (38 U.S.C. 8153)
    (4) First phase evaluation and down-select. The Government shall 
evaluate all offerors' submissions in accordance with the notice and 
make a down-select decision. (38 U.S.C. 8153)
    (5) Subsequent phases. Additional information shall be sought in 
the second phase so that a down-select can be performed or an award 
made without exchanges, if necessary. The contracting officer may 
conduct exchanges with remaining offeror(s), request proposal 
revisions, or request best and final offers, as determined necessary by 
the contracting officer, in order to make an award decision. (38 U.S.C. 
8153)
    (6) Debriefing. Without regard to FAR 15.505, contracting officers 
must debrief offerors whose proposals are not accepted under a 
competitive request for proposals (RFP) as required by 873.118. (38 
U.S.C. 8153)
    (d) Alternative negotiation techniques. (1) Contracting officers 
may utilize alternative negotiation techniques for the acquisition of 
health-care resources. Alternative negotiation techniques may be used 
when award will be based on either price or price and other factors. 
Alternative negotiation techniques include but are not limited to:
    (i) Indicating to offerors a price, contract term or condition, 
commercially available feature, and/or requirement (beyond any 
requirement or target specified in the solicitation) that offerors will 
have to improve upon or meet, as appropriate, in order to remain 
competitive.
    (ii) Posting offered prices electronically or otherwise (without 
disclosing the identity of the offerors) and permitting revisions of 
offers based on this information.
    (2) Except as otherwise permitted by law, contracting officers 
shall not conduct acquisitions under this section in a manner that 
reveals the identities of offerors, releases proprietary information, 
or otherwise gives any offeror a competitive advantage (see FAR 3.104). 
(38 U.S.C. 8153)


873.112  Evaluation information.

    (a) Without regard to FAR 15.304--Evaluation factors and 
significant subfactors (except for 15.304(c)(1) and (c)(3), which do 
apply to acquisitions under this authority), the criteria, factors, or 
other evaluation information that apply to an acquisition, and their 
relative importance, are within the broad discretion of agency 
acquisition officials as long as the evaluation information is 
determined to be in the best interest of the Government. (38 U.S.C. 
8153)
    (b) Price or cost to the Government must be evaluated in every 
source selection. Past performance shall be evaluated in source 
selections for competitive acquisitions exceeding the SAT unless the 
contracting officer documents that past performance is not an 
appropriate evaluation factor for the acquisition. (38 U.S.C. 8153)
    (c) The quality of the product or service may be addressed in 
source selection through consideration of information such as past 
compliance with solicitation requirements, technical excellence, 
management capability, personnel qualifications, and prior experience. 
The information required from quoters, bidders, or offerors shall be 
included in notices or solicitations, as appropriate. (38 U.S.C. 8153)
    (d) The relative importance of any evaluation information included 
in a solicitation must be set forth therein. (38 U.S.C. 8153)


873.113  Exchanges with offerors.

    (a) Without regard to FAR 15.201 or 15.306, acquisitions generally 
involve exchanges between the Government and competing offerors. Open 
exchanges support the goal of efficiency in Government by providing the 
Government with relevant information (in addition to that submitted in 
the offeror's initial proposal) needed to understand and evaluate the 
offeror's proposal. The nature and extent of exchanges between the 
Government and offerors is a matter of contracting officer judgment. 
Clarifications, communications, and discussions are not applicable to 
acquisitions under this part 873. (38 U.S.C. 8153)
    (b) Exchanges with potential offerors may take place throughout the 
source selection process. Exchanges may start in the planning stages 
and continue through contract award. Exchanges should occur most often 
with offerors determined to be in the best value pool (see 873.114). 
The purpose of exchanges is to ensure there is mutual understanding 
between the Government and the offerors on all aspects of the 
acquisition, including offerors' submittals/proposals. Information 
disclosed as a result of oral or written exchanges with an offeror may 
be considered in the evaluation of an offeror's proposal. (38 U.S.C. 
8153)
    (c) Exchanges may be conducted, in part, to obtain information that 
explains or resolves ambiguities or other concerns (e.g., perceived 
errors, omissions, or deficiencies) in an Offeror's proposal. (38 
U.S.C. 8153)
    (d) Exchanges shall only be initiated if authorized by the 
contracting officer and need not be conducted with all offerors. (38 
U.S.C. 8153)
    (e) Except for acquisitions based on alternative negotiation 
techniques contained in 873.111(d)(1), the contracting officer and 
other Government personnel involved in the acquisition shall not 
disclose

[[Page 6288]]

information regarding one offeror's proposal to other offerors without 
consent of the offeror in accordance with FAR parts 3 and 24. (38 
U.S.C. 8153)
    (f) Award may be made on initial proposals without exchanges if the 
solicitation states that the Government intends to evaluate proposals 
and make award without exchanges, unless the contracting officer 
determines that exchanges are considered necessary. (38 U.S.C. 8153)


873.114  Best value pool.

    (a) Without regard to FAR 15.306(c), the contracting officer may 
determine the most highly rated proposals having the greatest 
likelihood of award based on the information or factors and subfactors 
in the solicitation. These vendors constitute the best value pool. This 
determination is within the sole discretion of the contracting officer. 
Competitive range determinations are not applicable to acquisitions 
under this part 873. (38 U.S.C. 8153)
    (b) In planning an acquisition, the contracting officer may 
determine that the number of proposals that would otherwise be included 
in the best value pool is expected to exceed the number at which an 
efficient, timely, and economical competition can be conducted. In 
reaching such a conclusion, the contracting officer may consider such 
factors as the results of market research, historical data from 
previous acquisitions for similar services, and the resources available 
to conduct the source selection. Provided the solicitation notifies 
offerors that the best value pool can be limited for purposes of making 
an efficient, timely, and economical award, the contracting officer may 
limit the number of proposals in the best value pool to the greatest 
number that will permit an efficient competition among the proposals 
offering the greatest likelihood of award. The contracting officer may 
indicate in the solicitation the estimate of the greatest number of 
proposals that will be included in the best value pool. The contracting 
officer may limit the best value pool to a single offeror. (38 U.S.C. 
8153)
    (c) If the contracting officer determines that an offeror's 
proposal is no longer in the best value pool, the proposal shall no 
longer be considered for award. Written notice of this decision must be 
provided to unsuccessful offerors at the earliest practicable time. (38 
U.S.C. 8153)


873.115  Proposal revisions.

    (a) The contracting officer may request proposal revisions as often 
as needed during the proposal evaluation process at any time prior to 
award from vendors remaining in the best value pool. Proposal revisions 
shall be submitted in writing. The contracting officer may establish a 
common cutoff date for receipt of proposal revisions. Contracting 
officers may request best and final offers n. In any case, contracting 
officers and acquisition team members must safeguard all proposals and 
revisions to avoid unfair dissemination of an offeror's proposal. (38 
U.S.C. 8153)
    (b) If an offeror initially included in the best value pool is no 
longer considered to be among those most likely to receive award after 
submission of proposal revisions and subsequent evaluation thereof, the 
offeror may be eliminated from the best value pool without being 
afforded an opportunity to submit further proposal revisions. (38 
U.S.C. 8153)
    (c) Requesting and/or receiving proposal revisions does not 
necessarily conclude exchanges. However, requests for proposal 
revisions should advise offerors that the Government may make award 
without obtaining further revisions. (38 U.S.C. 8153)


873.116  Source selection decision.

    (a) An integrated comparative assessment of proposals should be 
performed before source selection is made. The SSA shall independently 
determine which proposal(s) represents the best value, consistent with 
the evaluation information or factors and subfactors in the 
solicitation, and that the prices are fair and reasonable. The SSA may 
determine that all proposals should be rejected if it is in the best 
interest of the Government. (38 U.S.C. 8153)
    (b) The source selection team, or advisory boards or panels, may 
conduct comparative analysis(es) of proposals and make award 
recommendations, if the SSA requests such assistance. (38 U.S.C. 8153)
    (c) The source selection decision must be documented in accordance 
with FAR 15.308. (38 U.S.C. 8153)


873.117   Award to successful offeror.

    (a) The contracting officer shall award a contract to the 
successful offeror by furnishing the contract or other notice of the 
award to that offeror. (38 U.S.C. 8153)
    (b) If a request for proposal (RFP) process was used for the 
solicitation and if award is to be made without exchanges, the 
contracting officer may award a contract without obtaining the 
offeror's signature a second time. The offeror's signature on the offer 
constitutes the offeror's agreement to be bound by the offer. If a 
request for quotation (RFQ) process was used for the solicitation, and 
if the contracting officer determines there is a need to establish a 
binding contract prior to commencement of work, the contracting officer 
should obtain the offeror's acceptance signature on the contract to 
ensure formation of a binding contract. (38 U.S.C. 8153)
    (c) If the award document includes information that is different 
than the latest signed offer, both the offeror and the contracting 
officer must sign the contract award. (38 U.S.C. 8153)
    (d) When an award is made to an offeror for less than all of the 
items that may be awarded and additional items are being withheld for 
subsequent award, each notice shall state that the Government may make 
subsequent awards on those additional items within the offer acceptance 
period. (38 U.S.C. 8153)


873.118  Debriefings.

    Offerors whose proposals are not accepted under a competitive 
request for proposals (RFP) may submit a written request for a 
debriefing to the contracting officer. Without regard to FAR 15.505, 
preaward debriefings may be conducted by the contracting officer when 
determined to be in the best interest of the Government. Post-award 
debriefings shall be conducted in accordance with FAR 15.506. (38 
U.S.C. 8153)

[FR Doc. 2020-29196 Filed 1-19-21; 8:45 am]
BILLING CODE 8320-01-P