Protest Denial Decision Released: DHA TRICARE Managed Healthcare Services

DIGEST  1.  Protest alleging that agency misevaluated proposals and made an unreasonable source selection decision is denied where the record shows that the agency’s evaluation was reasonable and consistent with the terms of the solicitation.  2.  Protest that agency engaged in misleading discussions by raising several weaknesses early in discussions, but failing to raise them again in subsequent rounds of discussions is denied where the record shows that the agency raised the weaknesses several times and made no representations that might lead the protester to believe they were resolved.  3.  Protest that the owners of an other-than-small business may not be excluded from a small business subcontracting plan as affiliates because they cannot meet the tests for affiliation in the Small Business Administration’s (SBA) regulations is denied, because the solicitation adopted the Federal Acquisition Regulation’s (FAR) general definition of affiliates rather than the SBA’s definition, and the agency’s interpretation of the relevant FAR provision is reasonable.   4.  Protest alleging material misrepresentations by awardee is denied where the record establishes that the disputed statements were not false statements, but represented, at worst, unacceptable aspects of the awardee’s proposal that were subsequently corrected during discussions or otherwise were minor inconsistencies that had no bearing on the agency’s evaluation.

DISCUSSION  The protester challenges the agency’s evaluation of the technical/management risk, past performance, and small business participation factors.  Additionally, the protester alleges that the awardee made several material misrepresentations related to its proposed and historical small business utilization, which collectively warrant the awardee’s exclusion from the competition.  Finally, the protester alleges that the agency conducted misleading discussions with respect to price and performed an impermissible price realism evaluation.  We address these arguments in turn….

DECISION  Health Net Federal Services, LLC, of Sacramento, California, protests the award of a contract to TriWest Healthcare Alliance Corporation, of Phoenix, Arizona, under request for proposals (RFP) No. HT9402-20-R-0005 issued by the Department of Defense (DOD), Defense Health Agency (DHA) for managed healthcare support services for the TRICARE program in the western region of the United States.  The protester alleges that the agency erred in its evaluation and in the conduct of discussions, and that the awardee made multiple false representations concerning its small business subcontracting plan.  We deny the protest.

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