BNUMBER:  B-261845.2
DATE:  September 29, 1995
TITLE:  Este Medical Services, Inc.

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REDACTED DECISION
A protected decision was issued on the date below and was subject to a 
GAO Protective Order.  This version has been redacted or approved by 
the parties involved for public release.

Matter of:Este Medical Services, Inc.

File:     B-261845.2

Date:     September 29, 1995

D. Lee Roberts, Jr., Esq., Ware, Snow, Fogel, Jackson & Greene, for 
the protester.
Maj. Michael J. O'Farrell, Jr., and Roy L. Masengale, Esq., Department 
of the Army, for the agency.
Andrew T. Pogany, Esq., Office of the General Counsel, GAO, 
participated in the preparation of the decision.

DIGEST

1.  Contracting agency reasonably eliminated the protester's proposal 
from the competitive range, although it was rated as susceptible to 
being made acceptable, and even though the protester's proposal had 
previously been included in the competitive range, where technical 
weakness concerning the protester's experience as reflected in its 
revised proposal, which was submitted after discussions, caused it to 
receive the [deleted] lowest technical rating, such that it no longer 
had a reasonable chance of being selected for award.

2.  Contracting agencies are not obligated to afford all-encompassing 
discussions or to discuss every element of a competitive range 
proposal; agencies are only required to lead offerors into the areas 
of their proposals considered deficient.

DECISION

Este Medical Services, Inc. protests the exclusion of its proposal 
from the competitive range under request for proposal (RFP) No. 
DADA13-94-R-0019, issued by the Department of the Army for nursing 
services at two health facilities.

We deny the protest.

The RFP, issued on July 29, 1994, contemplated the award of a 
fixed-price indefinite quantity contract (based on estimated hours of 
nursing services required) for a base period and two 1-year options.  
The RFP stated that award would be made to a single offeror who 
submitted the "best overall proposal" considering the stated 
evaluation factors.  The RFP contained two evaluation factors:  (1) 
technical/quality; and (2) price, which was of lesser importance.  The 
technical/quality factor had two subfactors, which were of equal 
importance, experience/capability/availability[1] and understanding 
the requirement.[2]  Finally, the RFP stated that price would be 
evaluated but not scored.

Seventeen proposals were received by September 12, 1994, the amended 
date for receipt of initial proposals.  The proposals were evaluated 
by a source selection evaluation board (SSEB); the contracting officer 
was designated the source selection official (SSO).  As relevant here, 
the SSEB's initial evaluation resulted in Este being ranked [deleted] 
of [deleted] offerors.  Specifically, the SSEB expressed concern about 
Este's experience because it was unclear whether the firm ever held a 
contract in its own name.  Further, while Este in its proposal 
referred to a relationship with International Health Services (IHS), 
an experienced company, the proposal did not show a joint venture 
relationship or any other legally binding commitment by IHS to support 
Este in performing this contract.[3]  Nevertheless, the contracting 
officer included all offers, including Este's, in the competitive 
range.

On April 24, 1995, the agency, among other things, asked Este the 
following discussion question:

     "[Provide d]etails regarding any contract that [Este] has held in 
     its own company name.  You are advised that since [Este] is the 
     offeror and if a contract were awarded, Este would be legally 
     bound to perform.  Any agreements between the prime contractor 
     and other companies is an autonomous agreement.  Therefore, 
     [Este] must be found to be capable of performance on its own 
     merit/previous experience."

Revised proposals were received.  Este stated in its revised proposal 
that Este was established in 1994 and that it has owners in "common" 
with IHS and that IHS was its "mentor."  In addition, Este stated that 
it was awarded only one contract in the past to provide Fort Knox the 
services of two midwives.  The agency states that it was unable to 
find evidence that Este met the minimum experience requirements or 
that Este had established a subcontracting arrangement with IHS or 
obtained any other legally binding commitment from the firm to assist 
Este in the performance of this contract.  The protester in fact 
stated in its proposal that IHS and Este were separate legal entities.  
The agency also concluded that Este had provided only one previous 
reference in its own name (to provide two midwives), which was not 
"considered comparable to this [current] requirement in terms of size 
and scope."[4]

After this second evaluation by the agency following discussions, Este 
was rated [deleted] of [deleted] firms.[5]  The contracting officer 
established a competitive range of two proposals; two other firms 
withdrew their offers.  Thirteen offerors, including Este, were 
excluded.  This protest followed.

In its protest, Este does not directly challenge the agency's 
substantive findings about its lack of experience to meet the RFP 
requirements.  Rather, Este argues several procedural flaws which 
allegedly occurred during evaluation.  Specifically, Este challenges 
the adequacy and accuracy of the 1,000-point scoring system and the 
various numerical "cut-offs" for exceptional, good, acceptable, 
susceptible and unacceptable; alleges that the agency failed to 
adequately document the deficiencies it found in Este's technical 
proposal; and alleges that the agency failed to conduct meaningful 
discussions because the agency's written discussion question about its 
experience was not sufficiently clear and was misleading.

Our examination of an agency's decision to exclude a proposal from the 
competitive range begins with the agency's evaluation of proposals.  
Labat-Anderson Inc., B-246071.4, Oct. 9, 1992, 92-2 CPD  244.  In 
reviewing an agency's technical evaluation, we will not reevaluate the 
proposal but will examine the record of the agency's evaluation to 
ensure that it was reasonable and in accord with stated evaluation 
criteria, and not in violation of procurement laws and regulations.  
Id.  The competitive range consists of all proposals that have a 
reasonable chance of being selected for award, generally including 
proposals that are technically acceptable or reasonably susceptible of 
being made acceptable through discussions.  Intown Properties, Inc., 
B-250392, Jan. 28, 1993, 93-1 CPD  73.  However, even a technically 
acceptable proposal may be eliminated by comparing the relative 
ranking and merit of the higher-rated proposals to the proposal in 
question; thus, an agency may eliminate a technically acceptable 
proposal based on a relative evaluation and ranking of the merits of 
proposals.  See Coe-Truman Technologies, Inc., B-257480, Sept. 12, 
1994, 94-2 CPD  136.  If the agency's evaluation of proposals is 
reasonable, there is nothing improper in an agency's making more than 
one competitive range determination and dropping a firm from further 
consideration.  Labat-Anderson Inc., supra.

Because the protester has not submitted any substantive evidence 
rebutting the findings of the agency that Este's revised proposal, 
even after discussions, was seriously flawed and materially inferior 
with respect to experience both objectively and on a relative basis 
with respect to higher-rated proposals, we conclude that the agency's 
technical evaluation and findings concerning this deficiency were 
reasonable.  We think the agency reasonably decided that Este's 
experience, which consisted of a single contract for two midwives, 
failed to meet the minimum requirements of the RFP.  Further, since 
these findings concerning Este's experience were in narrative form, we 
find irrelevant the arguments of the protester concerning the adequacy 
and accuracy of the numerical point system generally used by the 
agency during the evaluation.  Even if we were to conclude that the 
point scoring was incorrect the narrative evaluation which found 
Este's experience deficient provides a rational basis for the 
rejection of Este's proposal.  Moreover, since the contracting officer 
was provided by the evaluators, through their narrative, with 
sufficient information concerning Este's experience on which to 
rationally conclude that the firm's proposal was deficient and 
relatively inferior, we find no merit to the protester's argument that 
the agency failed to adequately document the protester's deficient 
experience.

Finally, concerning the protester's allegation that the agency failed 
to conduct meaningful discussions, agencies are not obligated to 
afford all-encompassing discussions or discuss every element of a 
competitive range proposal; agencies are only required to lead 
offerors into the areas of their proposals considered deficient.  See 
donald clark Assocs., B-253387, Sept. 15, 1993, 93-2 CPD  168.  Here, 
while the agency's discussion question did not specifically advise the 
protester to proceed to form a joint venture, teaming or 
subcontracting relationship with IHS, as the protester argues the 
agency should have, we think the agency's discussion question, quoted 
above, adequately led the firm into the area of its experience, which 
the discussion question clearly conveyed to be a deficiency.  Given 
the specific experience requirements of this RFP, and the discussion 
question, the protester was reasonably placed on notice that the 
evidence of its experience in its revised proposal was not adequate to 
meet solicitation requirements.

The protest is denied.

Comptroller General
of the United States

1. Concerning the offerors' experience, the RFP stated that offers 
would only be considered from firms which are regularly established in 
the business solicited and can establish evidence of their reliability 
and the ability of personnel directly employed or supervised by them 
to render prompt and satisfactory service.  The RFP further stated 
that "[t]he offeror shall have had not less than three years 
successful experience in recruiting direct health care provider 
personnel.  Ability to meet the foregoing experience requirements and 
the adequacy of the information submitted will be considered in 
determining the competitive range."

2. During the evaluation, the agency scored the technical merits of 
the proposals.  The maximum possible technical score was 1,000 points.  
The scores were described in the agency's source selection evaluation 
plan as follows:  (1) exceptional ([deleted] - 1,000 points); (2) good 
([deleted] - [deleted]); (3) acceptable ([deleted] - [deleted]); (4) 
susceptible ([deleted] - [deleted]); and (5) unacceptable (0 - 
[deleted]).

3. Este merely stated in its proposal that it would "utilize the 
resources, experience, and capabilities of IHS, its mentor, in 
providing services [to the Army].  IHS, owned by Este principal 
Charles V. Rice, is an experienced [contractor].  For purposes of this 
proposal, however, all experience which is drawn from either owner in 
common, or IHS, will be referred to as Este experience or capability."

4. The record shows that other firms had experience exceeding the 
minimum requirements of the RFP.

5. Concerning price, the agency evaluated Este's price as 
approximately [deleted] million.  Revised prices ranged from [deleted] 
million to [deleted] million.  The agency's independent government 
estimate was [delted] million.  Contrary to the protester's arguments 
in its comments on the agency report, the agency analyzed and 
evaluated prices, and the contracting officer was fully aware of 
Este's price in making his determination to exclude the firm from 
competition.  There is no evidence to show that the agency "ignored 
the lower proposed cost of Este."  As discussed below, despite its 
generally lower price, Este's technical proposal was reasonably 
determined by the agency to have no reasonable chance for award 
principally because of its inadequate experience record.