TITLE:  Rotech Medical Corporation, B-283295.2, November 8, 1999
BNUMBER:  B-283295.2
DATE:  November 8, 1999
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Rotech Medical Corporation, B-283295.2, November 8, 1999

Decision

Matter of: Rotech Medical Corporation

File: B-283295.2

Date: November 8, 1999

Carlos Moral for the protester.

Phillipa L. Anderson, Esq., Cameron V. Gore, Esq., and Philip S. Kauffman,
Esq., Department of Veterans Affairs, for the agency.

Christine Davis, Esq., and James Spangenberg, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Agency reasonably determined that the awardee's proposed staffing and
facilities approach was better than the protester's, notwithstanding that
the protester currently operates more facilities and employs more personnel
than the awardee, where the awardee submitted a more detailed, comprehensive
proposal.

2. Agency was not required to contact the protester's past performance
references, where the solicitation contemplated a past performance
evaluation based only upon proposal documentation.

3. Where the protester's proposal included negative performance information
from an accrediting organization, and the protester failed to dispel the
legitimate concerns raised by this information during discussions, the
agency had no obligation to disregard the negative performance information
simply because it did not suffice to deny the protester accreditation, nor
was the agency required to contact the accrediting organization to
investigate the information.

DECISION

Rotech Medical Corporation protests the award of a contract to Lors Medical
Corporation under request for proposals (RFP) No. 247-001-99, issued by the
Department of Veterans Affairs (VA), for the provision of home oxygen
services in the Veterans Integrated Service Network (VISN) #7 covering
Alabama, Georgia, and South Carolina.

We deny the protest.

The solicitation contemplated the award of a fixed-price contract for a
variety of supplies and services associated with home oxygen care to
veterans. RFP sect. 52.216-1. The RFP, as amended, requested unit and extended
prices for the various supplies and services for a base year plus 4 option
years. RFP addendum to Standard Form 1449 – Block #20.

The solicitation provided for award to the offeror whose proposal,
conforming to the solicitation, would be most advantageous to the
government, based on a scoring system recognizing the solicitation's
evaluation factors. RFP sect. 52.212-2, Evaluation -- Commercial Items. The RFP
listed four evaluation factors in descending order of importance, which the
agency quantified on an internal 100-point scoring scale consistent with the
RFP, as follows: (1) past performance and demonstrated capability (35
points), (2) quality assurance (30 points), (3) personnel qualifications (20
points), and (4) cost/pricing (15 points). Id.; Agency Report, Tab 12,
Evaluation Criteria & Scoring Sheet. Under the past performance and
demonstrated capability factor, the offeror was to document, among other
things, its ability to provide a sufficient number of adequately trained
personnel and its ability to meet the solicitation's response time
requirements for supplies and services based on the sites and staff proposed
for performance. RFP addendum to sect. 52.212-2, para.para. B.2, B.3.a.

VA received eight initial proposals and, after evaluating them, included
six, including Lors's and Rotech's, in the competitive range. Agency Report
at 3. The agency conducted a round of discussions and received offerors'
final proposal revisions (referred to in the record as "refined proposals").
Id. Lors was found to have submitted the highest-rated and lowest-priced
proposal. Agency Report, Tab 21, Technical Scores (Final), Pricing Scores
(Final). Lors's proposal also received the highest combined technical and
price score of 92.53 points, scoring 77.53 of the available 85 technical
points and the maximum number of price points (15 points). Lors's proposal
was priced 28 percent less than Rotech's next lowest-priced proposal;
Rotech's price score (10.87 points) reflected this price disadvantage. In
terms of technical merit, Rotech's proposal was the lowest-rated of the
competitive range proposals, scoring only 49.48 out of 85 technical points.
Rotech's proposal also received the lowest combined price and technical
score of 60.35 points. Based on the price and technical evaluation results,
the agency made award based on Lors's highest-rated, lowest-priced proposal.

Rotech protests that VA misevaluated aspects of its own and Lors's proposal.
In reviewing protests against allegedly improper evaluations, it is not our
role to reevaluate proposals. Rather, our Office examines the record only to
determine whether the agency's judgment was reasonable and in accord with
the RFP's stated evaluation factors. Brisk Waterproofing Co., Inc.,
B-276247, May 27, 1997, 97-1 CPD para. 195 at 3. The fact that a protester does
not agree with the agency's evaluation does not render the evaluation
unreasonable. TRW, Inc., B-260623 et al., July 7, 1995, 95-2 CPD para. 92 at 6.

Rotech first argues that the agency misevaluated its and Lors's proposals
under the past performance and demonstrated capability factor. In
particular, Rotech argues that it operates more service centers and employs
more personnel than Lors within the VISN #7 service area. Protester's
Comments para. 4. As a result, Rotech contends that it is better able than Lors
to provide a sufficient number of adequately trained personnel and to meet
the RFP's response time requirements. Rotech thus argues that its proposal
should have received a better score under the past performance and
demonstrated capability factor than Lors's proposal.

Although Rotech may have more service centers and employees currently in
place than Lors, the awardee thoroughly documented its plan to open
additional service centers and to provide adequate, qualified staff at these
service centers. Lors's Initial Proposal at 13-15. Lors also thoroughly
documented the qualifications of its existing staff, explained how it would
reallocate certain existing staff members to the VISN #7 service area, and
explained how it would provide adequate staff at the proposed service
centers to meet the RFP requirements. Lors's Initial Proposal at 15, 16,
Tab 12. Having reviewed Lors's proposal, we find no basis to question the
agency's judgment that the awardee's staffing and service center approach
reflected "comprehensive considerations" and demonstrated "a readily
achievable capability to provide sufficient staffing." Agency Report, Tab
20, Final Technical Comments for Awardee, at 1. On the other hand,
regardless of whether the protester currently operates more service centers
or employs more staff, its proposal was disorganized, confusing, and largely
bereft of narrative detail as to how it would meet the RFP requirements, as
compared with Lors's well-conceived and well-written technical approach.
Compare Lors's Initial Proposal at 12-16 with Rotech's Initial Proposal sect. 7,
Branches' Service Areas for VISN 7, and Rotech's Refined/Final Proposal,
enclosures (3a), (3b), (4), and Dublin, GA Location Issue. In conclusion,
our review of the two proposals supports the agency's determination that
Lors's staffing and service center approach was better documented than
Rotech's and justified better scores under the past performance and
demonstrated capability factor.

The protester also claims that the agency improperly contacted only the
awardee's past performance references in evaluating proposals under the past
performance and demonstrated capability factor. This allegation has no
merit. Contrary to the protester's apparent belief, the past performance and
demonstrated capability factor neither requested past performance
references, nor did it provide that the agency would contact references
during the proposal evaluation. RFP addendum to sect. 52.212-2.B. Rather, the
RFP provided that the agency would evaluate past performance based on the
documentation submitted by the offeror concerning its corporate and
personnel experience, and the record reflects that the agency did just that.
Id.; Agency Report, Tab 13, Initial Evaluation of Proposals and Tab 20,
Final Technical Comments. There is no evidence that the agency contacted
past performance references for any offeror, including the awardee, during
the proposal evaluation; instead, the agency apparently limited its
evaluation to the past performance documentation submitted with each
proposal, consistent with the RFP. The record shows that the agency did not
contact Lors's references until the pre-award survey to determine Lors's
responsibility. See Agency Report, Tab 36, Letter from Network Contract
Specialist to Protester para. 7 (Aug. 23, 1999). The protester, an unsuccessful
offeror, was not entitled to a pre-award survey. See Federal Acquisition
Regulation sect. 9.100.

Rotech also protests that the agency improperly considered certain negative
performance information submitted with its proposal. Under the quality
assurance factor, offerors were to demonstrate, among other things, that the
facilities proposed for performance were accredited by the Joint Commission
of Accreditation of Healthcare Organizations (JCAHO), and to identify any
JCAHO citations and the resolution of those citations. RFP addendum to
sect. 52.212-2, para.para. C.4, C.5. Rotech not only submitted JCAHO accreditation
certificates for its facilities, but also attached a JCAHO "supplemental
recommendations" report that documented numerous quality and performance
problems. See Rotech's Initial Proposal, JCAHO Supplemental Recommendations
Section. Although Rotech received discussions concerning the negative JCAHO
information, Rotech's final refined proposal failed to resolve many of the
concerns raised by the JCAHO information, which caused the proposal to be
downgraded under both the past performance and demonstrated capability
factor and the quality assurance factor. See Agency Report, Tab 20, Final
Technical Comments for Protester, Factors A and B; see also Rotech's
Final/Refined Proposal, Factor C, JCAHO Official Accreditation Decision
Report.

Rotech argues that the agency improperly considered the JCAHO information to
downgrade aspects of its proposal--in particular, its quality assurance
process, disaster plan, and its individualized health care plans.
Protester's Comments para.para. 2,
6, 7. Rotech contends that the agency should have disregarded the JCAHO
"supplemental recommendations" because they "are not binding . . . and are
purely consultative in nature." Id. para. 7. According to the protester, the
agency should have instead considered that, despite the reported quality and
performance problems, Rotech's JCAHO scores, which were included in its
proposal, were sufficient to receive JCAHO accreditation. Id. In addition,
Rotech argues that the agency should have contacted JCAHO to obtain
additional information concerning the protester's performance and to obtain
other offerors' JCAHO scores. Id. para.para. 2, 7. Had the agency done so, the
protester argues, the agency would have discovered that the protester's
performance was not only adequate, but was better than the awardee's. Id.
para. 2.

Contrary to the protester's arguments, the RFP did not require the agency to
contact the JCAHO for additional information concerning offerors'
performance or scores, but contemplated that the agency would consider only
the JCAHO information included with each proposal. See RFP addendum to
sect. 52.212-2, para.para. C.4, C.5. Thus, the agency reasonably confined its evaluation
to the JCAHO information included in the awardee's and the protester's
proposals. In its proposal, Lors, consistent with the RFP, documented its
JCAHO accreditation, affirmed that it had not received any JCAHO citations,
and noted no performance problems. Lors's Initial Proposal at
28-29, Tab 10. The agency's favorable evaluation of Lors's JCAHO
documentation comported with the RFP, see Agency Report, Tab 20, Final
Technical Comments for Lors, Factor B para.para. 4, 5, and provides no basis for
objection.

In contrast, the protester's proposal included negative JCAHO information in
several areas, and the protester failed to dispel the legitimate concerns
raised by this information, despite receiving an opportunity to do so during
discussions. The agency had no obligation under the RFP to disregard this
negative performance information simply because it did not suffice to deny
the protester JCAHO accreditation. Accordingly, we find that the agency
reasonably downgraded the protester's proposal because the JCAHO
documentation reflected negatively on aspects of its quality assurance
process, disaster plan, and its individualized health care plans. While the
protester argues that its proposal established a sound approach to quality
assurance, disaster preparedness and individualized health care planning,
the record reasonably supports the agency's judgment that the protester's
proposal was poorly written and poorly documented in these areas. [1] The
protester's mere disagreement with that judgment does not establish that it
was unreasonable. Shelby's Gourmet Foods, B-270585, Mar. 22, 1996, 96-1 CPD
para. 166 at 6.

Finally, the protester argues that the agency erred in refusing to consider
a 2-percent discount to its aggregate pricing. See Agency Report, Tab 19,
Rotech's Final/Refined Pricing Proposal. Regardless of whether the agency
should have considered the price discount, we find that any alleged error
was not prejudicial. Even had the agency considered Rotech's proposed
2-percent discount, Rotech's lower-rated proposal would have maintained a
significant (26 percent) price disadvantage relative to Lors's highest-rated
proposal. Our Office will not sustain a protest unless the protester
demonstrates a reasonable possibility that it was prejudiced by the agency's
actions, that is, unless the protester demonstrates that, but for the
agency's actions, it would have had a substantial chance of receiving the
award. McDonald-

Bradley, B-270126, Feb. 8, 1996, 96-1 CPD para. 54 at 3; see Statistica, Inc. v.
Christopher, 102 F.3d 1577 (Fed. Cir. 1996). Here, the agency's failure to
consider Rotech's 2-percent price discount did not affect the final award
determination and was not prejudicial. [2]

The protest is denied.

Comptroller General
of the United States

Notes

1. For example, Rotech argues that its quality assurance plan properly
documented the average time patients were without oxygen, contrary to the
agency's evaluation judgment. However, our review of the record confirms the
agency's finding that Rotech's proposal lacked adequate documentation on
this issue. See Rotech's Initial Proposal, Veteran Administration Summary
Data Sheet; Rotech's Final/Refined Proposal, Response Time; Agency Report,
Tab 20, Final Technical Comments for Rotech, Factor A para. 4d.

2. Rotech also protests that the agency, in evaluating proposals, improperly
considered a letter written by the incumbent contractor, in which it
encouraged veterans to continue to order home oxygen services from the
incumbent, rather than under the contract arising from the instant
solicitation. Based on our review, this letter lacked any relevance to, and
played no part in, the proposal evaluation in this case.