TITLE:  LifeCare, Inc., B-291672; B-291672.2, February 20, 2003
BNUMBER:  B-291672; B-291672.2
DATE:  February 20, 2003
**********************************************************************
LifeCare, Inc., B-291672; B-291672.2, February 20, 2003

   DOCUMENT FOR PUBLIC RELEASE                                                
The decision issued on the date below was subject to a GAO Protective      
Order.  This redacted version has been approved for public release.        

   Decision
    
Matter of:    LifeCare, Inc.
    
File:             B-291672; B-291672.2
    
Date:              February 20, 2003
    
E. Sanderson Hoe, Esq., and Alison L. Doyle, Esq., McKenna Long &
Aldridge, for the protester. 
Edward N. Ramras, Esq., U.S. Marine Corps, for the agency. 
Glenn G. Wolcott, Esq., and Michael R. Golden, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Agency reasonably rejected protester's proposal as technically
unacceptable where solicitation required that proposals *shall contain
detailed information that addresses and responds to the evaluations
factors,* the solicitation listed the adequacy of offerors' proposed
management plans and marketing plans as evaluation factors, and
protester's proposal contained neither a management plan nor a marketing
plan.
DECISION
    
LifeCare, Inc. protests the U.S. Marine Corps's award of a federal supply
schedule (FSS) task order to Ceridian Corporation pursuant to a request
for proposals (RFP) to provide various employee assistance services for
Marine Corps members and their families.  LifeCare protests that the
agency improperly evaluated LifeCare's proposal as technically
unacceptable. 
    

   We deny the protest.
    
BACKGROUND
    
In August 2002, the U.S. Marine Corps identified a need to provide on-call
employee assistance program (EAP) services for service members and their
families.  On September 10, 2002, the U.S. Marine Corps issued a
solicitation to three FSS vendors, including LifeCare and Ceridian,
seeking proposals to provide on-demand EAP services, 24 hours a day, 7
days a week, via toll-free telephone lines and the Internet.  Agency
Report, Tab 4.[1]  The performance work statement (PWS), which was
included as part of the solicitation, specified various required EAP
services, including the provision of:  parenting and child care
information,[2] education services,[3] financial information and
counseling,[4] legal information and referrals,[5] elder care
information,[6] *warm hand off* to TRICARE,[7] library services,[8] and
*everyday* information.[9]  Agency Report, Tab 4, at 15-17.   
    
The solicitation contemplated award of a task order for a 1-year base
period with four 1-year option periods, and required each FSS vendor to
submit separate technical and price proposals.  The solicitation further
provided that proposals would be evaluated on the basis of technical
capability, past performance, and price, stating that technical and past
performance factors combined were more important than price, and advising
offerors that award would be based on the proposal considered *most
advantageous to the Government, price and other factors considered.* 
Agency Report, Tab 4, at 4.
    
Regarding preparation of technical proposals, the solicitation directed:
    
The technical proposal shall contain detailed information that addresses
and responds to the evaluation factors for Technical Capabilities and Past
Performance.
Agency Report, Tab 4, at 2.
    
The solicitation listed nine technical evaluation factors, including the
following two:
    
d.     Adequacy of management plan and organizational structure to
accomplish the services involved in the PWS . . . .[ [10]]
.     .     .     .     .
h.  Proven ability to market this program to the military and spouse
population, including reservists[,] as demonstrated by a marketing plan as
a part of the submission.
Agency Report, Tab 4, at 4.[11]
    
Both LifeCare and Ceridian submitted proposals by the September 19, 2002
closing date.[12]  The agency first evaluated the technical proposals to
determine technical acceptability--that is, basic compliance with the
requirements identified under each evaluation factor.[13]  The agency
found Ceridian's proposal to be acceptable with regard to all evaluation
factors.  In contrast, the agency found LifeCare's technical proposal to
be unacceptable under four of the nine evaluation factors, including the
two factors quoted above that required submission of management and
marketing plans.[14]  Agency Report, Tab 5, at 1-2. 
    
The agency did not conduct discussions with either offeror, concluding on
the basis of its initial evaluation that Ceridian's proposal was most
advantageous to the government.  A task order was subsequently awarded to
Ceridian.  This protest followed. 
    
DISCUSSION
    
LifeCare protests that the agency improperly evaluated LifeCare's proposal
as unacceptable, arguing there was no reasonable basis for the agency to
conclude that LifeCare's proposal failed to provide the information
required by the solicitation.  We disagree.[15] 
    
The evaluation of technical proposals is a matter within the discretion of
the
contracting agency, since that agency is responsible for defining its
needs and determining the best method of accommodating them, and must bear
the results of a defective evaluation.  Orion Research, Inc., B-253786,
Oct. 21, 1993, 93-2 CPD P: 242 at 3.  Where an agency's technical
evaluation is challenged, our Office will not independently reevaluate the
proposals; rather, we will examine the evaluation to ensure that it was
reasonable and consistent with the stated evaluation factors and did not
violate procurements statute or regulations.  Integrity Private Sec.
Servs., Inc., B-255172, Dec. 17, 1993, 93-2 CPD P: 332 at 3.  A
protester's mere disagreement with the agency's conclusions does not
render the conclusions unreasonable.  Id.
    
As noted above, the solicitation directed that each technical proposal
*shall contain detailed information that addresses and responds to the
evaluation factors,* and the solicitation specifically included *adequacy
of management plan* as an evaluation factor.  Agency Report, Tab 4, at 2,
4.  Here, in evaluating LifeCare's proposal under this factor, the agency
stated:  *No management plan was provided.  The organizational structure
included individuals, biographies, and qualifications, however, we were
not able to clearly identify the plan to manage the process.*  Agency
Report, Tab 5, at 2. 
    
Based on our review of LifeCare's proposal, we find no basis to criticize
the agency's evaluation.  Despite the solicitation's explicit provisions
regarding submission of a management plan, the portion of LifeCare's
proposal purporting to address that requirement contained only a
discussion of LifeCare's corporate background and *biographies* of various
LifeCare staff members.  Agency Report, Tab 11, at 50-57.  More
specifically, this portion of the proposal contained biographies of
[deleted] LifeCare managers*[deleted] of whom were identified as
*executives who oversee the key departments at LifeCare*; yet nothing in
the biographies of these [deleted] executives indicates any involvement
with the task order at issue here.  Agency Report, Tab 11, at 51-55. 
Further, while the biographies of the remaining [deleted] managers discuss
their prior activities and qualifications, virtually no information is
provided regarding the manner in which the multiple performance
requirements of this solicitation will be managed.  Specifically, the
biographies of the [deleted] managers contain general assertions that they
[deleted] or [deleted], but contain virtually no descriptions of any
particular planned activities or interactions.  Agency Report, Tab 11, at
55-57.  Similarly, the proposal contains no organizational or staffing
chart that focuses on performing the requirements of this particular
contract.[16]  
    
A proposal that fails to satisfy a material solicitation requirement
cannot be considered for an award.  Techseco, Inc., B-284949, June 19,
2000, 2000 CPD 105 at 3.
Here, based on our review of LifeCare's proposal, we find no basis to
question the agency's conclusion that LifeCare's proposal did not contain
an adequate management plan (if it can be said to have a management plan
at all).  Further, we believe there can be no meaningful dispute that a
management plan regarding performance of the required EAP services
constituted a material solicitation requirement.  Accordingly, the agency
reasonably rejected LifeCare's proposal for failing to meet this
requirement.
    
The solicitation also provided that proposals would be evaluated with
regard to the offeror's ability to market the EAP program *as demonstrated
by a marketing plan as part of the [proposal] submission.*  Agency Report,
Tab 4, at 4. 
    
The agency evaluated LifeCare's proposal as unacceptable with regard to
this requirement on the basis that LifeCare did not propose any particular
marketing plan, that is, specific marketing activities.  Agency Report,
Tab 5, at 2.  Rather, LifeCare's proposal merely referenced various
marketing activities in which it had previously engaged, and stated: 
[deleted].  Agency Report, Tab 11, at 67.
    
Referencing a portion of the solicitation's PWS that discusses the
contractor's ongoing responsibility to develop and implement its marketing
campaign plan during contract performance, Agency Report, Tab 4, at 20-21,
LifeCare maintains that *[t]he PWS . . . clearly contemplated development
of the [marketing] plan during contract performance.*  Protest at 8. 
Accordingly, LifeCare argues that no plan for specific marketing
activities was required to be provided with its proposal and the
information regarding LifeCare's prior marketing activities should have
been considered sufficient to meet the solicitation requirement.  We
disagree. 
    
As noted above, the solicitation specifically required that offerors
include a marketing plan *as part of the [proposal] submission* in order
to demonstrate the offeror's ability and intent with regard to marketing
activities.  Agency Report, Tab 4, at 4.  The fact that the PWS
contemplates that the contractor will engage in continuing efforts to
develop and implement such a plan during contract performance does not
negate or otherwise eliminate the clear solicitation requirement that the
plan be presented, initially, within the offeror's proposal for the
agency's evaluation.  The effect of LifeCare's interpretation of the
solicitation is to leave the agency with no basis to assess the likely
effectiveness of the marketing efforts each offeror intends to employ
until after source selection has occurred.  On the record here, we find no
basis to question the agency's evaluation of LifeCare's proposal as
unacceptable with regard to the requirement to submit a marketing plan.   
    
Finally, LifeCare protests that the agency failed to properly consider
LifeCare's proposed price, which LifeCare maintains was approximately
[deleted] percent lower than Ceridian's price.[17] 
    
A technically unacceptable proposal cannot be considered for award;
accordingly, any purported cost savings flowing from the offeror's stated
price regarding its technically unacceptable proposal are irrelevant.  See
EMSA Ltd. Partnership, B‑254900.4, July 26, 1994, 94-2 CPD P: 43;
Color Ad Signs and Displays, B-241544, Feb. 12, 1991, 91-1 CPD P: 154. 
Here, because the agency reasonably evaluated LifeCare's proposal as
technically unacceptable, there was no need for the agency to give further
consideration to LifeCare's proposed price.  Accordingly, none of
LifeCare's complaints regarding the manner in which its price proposal
was, or was not considered, provide any basis for sustaining its
protest.[18]   
    
The protest is denied.
    
Anthony H. Gamboa
General Counsel 
    
    
    

   ------------------------

   [1] The RFP explained that, in light of the current state of heightened
security in which service members are deployed around the world and a
significant portion of members reside outside of military installations,
there is an ongoing need to provide additional support for members and
their families.  The EAP services being acquired here are intended to
reflect a reciprocal supporting relationship between the military and
service members and their families.  Agency Report, Tab 4, at 13.  The
agency further states:  *This is an Office of the Secretary of Defense
demonstration project and the Marines Corps is the test site for the
successful outcome of the project for implementation military-wide.* 
Agency Report, Tab 3, at 3.    
[2] For example, information regarding before- and after-school care and
summer camps, as well as identification of resources to address child
development, child safety and parenting skills.  Agency Report, Tab 4, at
15. 
[3] For example, information regarding school problems and study habits,
as well as coaching through the college application and selection
process.  Id.
[4] For example, information regarding credit management, check writing,
home buying and retirement planning, and tax preparation.  Agency Report,
Tab 4, at 16.
[5] For example, information regarding family matters, landlord/tenant
issues, and debtor/creditor issues.  Id.
[6] For example, information regarding the dependency determination
process, and referrals to in-home services such as home-delivered meals
and hospice services.  Id.
[7] For example, a three-way call initiated by contractor personnel
connecting the user with the appropriate TRICARE provider.  Agency Report,
Tab 4, at 17.
[8] For example, establishment of a library and mail/distribution center
to provide books, tapes, CDs and videos on life issues to military members
and their families.  Agency Report, Tab 4, at 16.
[9] For example, information regarding transportation, consumer issues,
pets, and pet care.  Id.
[10] In addition, without specific reference to the evaluation factors,
the solicitation separately stated:  *The technical proposal shall include
. . . [a] plan that demonstrates the offeror's capability to serve [the
specified population].*  Agency Report, Tab 4, at 2-3.
[11] In addition to the two evaluation factors quoted above, the
solicitation provided for evaluation of:  demonstrated ability to provide
EAP services to large commercial/government clients; qualifications of
staff, including EAP experience; corporate experience providing call
center support; demonstrated ability to increase staffing in the event of
mobilization; capability of automated systems; ability to handle client
base in excess of 200,000 people; and demonstrated capability to develop
an appropriate web site.  Id. 
[12] The third FSS vendor did not respond to the solicitation.
[13] LifeCare maintains that the agency's acceptability/unacceptability
evaluation, rather than a qualitative assessment, was improper because the
solicitation advised offerors that award would be based on the proposal
considered *most advantageous to the government, price and other factors
considered.*  Agency Report, Tab 4, at 4.  In light of the record here
which, as discussed below, adequately supports the agency's conclusion
that LifeCare's proposal failed to comply with the solicitation
requirements, there was no point in performing a qualitative assessment of
the two proposals and/or a price/technical tradeoff, since it is well
settled that a technically unacceptable proposal cannot be considered for
award.  See, e.g., EMSA Ltd. Partnership, B-254900.4, July 26, 1994, 94-2
CPD P: 43 at 5.
[14] The agency also concluded that LifeCare's proposal failed to properly
discuss the  EAP experience of its staff, and failed to demonstrate how
LifeCare would increase staffing in the event of mobilization.  Id.     
[15] As a preliminary matter, we note that where, as here, an agency
solicits FSS vendor responses and provides for a technical evaluation and
price/technical tradeoff--that is, uses an approach very similar to a
negotiated procurement, our Office will review the agency's actions, if
challenged pursuant to our bid protest regulations, to ensure that the
evaluation was reasonable and consistent with the terms of the
solicitation.  COMARK Fed. Sys., B‑278343, B‑278343.2, Jan.
20, 1998, 98-1 CPD P: 34 at 4-5.
    
[16] The proposal contains, instead, LifeCare's corporate organizational
chart, which contains no information addressing the performance of this
contract.  Agency Report, Tab 11, at 51.
[17] Based on our review of the record it is not clear what price LifeCare
proposed.  Although the solicitation required that price proposals must
include *a spreadsheet . . . that identifies the proposed labor
categories, hours and rates for the Base period . . . and all option
years,* Agency Report, Tab 4, at 3, LifeCare's proposal contained only two
price spreadsheets * one labeled *Base Period (Year One),* and one labeled
*Base Period (Year Two).*  Agency Report, Tab 11a, at 3-4.  LifeCare now
asserts that the spreadsheet labeled *Base Period (Year Two)* was intended
to apply to each of the four 1-year option periods.  The agency argues
that this intent was not evident from the face of the proposal and that
the agency could reasonably conclude that LifeCare had not offered to
provide option-year services.  Agency Supplemental Report, Jan. 21, 2003,
at 2.  As discussed above, the agency reasonably evaluated LifeCare's
proposal as technically unacceptable; accordingly, we need not resolve
this issue. 
[18] In filing and pursuing this protest, LifeCare has presented
additional arguments regarding various alleged procurement flaws.  We have
considered all of LifeCare's arguments and find no basis for sustaining
its protest.