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Keep up to date with the evolving world of government bidding with tips, best practices, trends, research and observations. Let BidNet's knowledge and experience work for you.

Government Contracts for Medical and Healthcare Services


Government Contracts for Medical and Healthcare Services

As one of the largest industries in the United States, the medical and healthcare sector is both a vital part of citizens’ daily lives and a major driver of the national economy. At one point or another, every single person living in the U.S. will require some sort of medical service, whether in the form of a doctor’s appointment, emergency hospital or ambulance services, a prescription for pharmaceuticals or the purchase of medical supplies. Because medical and healthcare services are so important to individuals and society, every year state and federal government departments collectively spend billions of dollars to procure services for those who require care.

Government agencies also offer medical and healthcare services for those who require ongoing care from the state, including veterans, the elderly and individuals with disabilities, whether physical or developmental. Unfortunately, we often don’t hear details about the level of care that these individuals receive. While some do receive a high standard of care, some patients may face limitations on which clinics or doctors they can go to for treatment, or agencies have to pay exorbitant costs to cover patient-related expenses. When situations like these arise, state governments will often contract outside vendors to provide medical care, supplies and equipment as needed.

Contract Opportunities for Medical and Healthcare Services

There are a wide variety of opportunities that state and local agencies need private vendors to provide. These products or services may be sought to meet the needs of individuals who are seeking medical care, or to supplement the work of agencies and service providers who already work in the industry. The following is a list of just some of the products and services agencies hire private vendors to provide:

  • Medical treatments
      • Regular checkups
      • Emergency care
      • Physical examinations
  • Lab work & testing
      • Blood work
      • Drug test
      • Vaccinations
  • Prescriptions/Pharmaceuticals
  • Health Aides, Nurses, Doctors
  • Medical Equipment (for homes and facilities, hospitals, doctor offices and clinics)
  • Supplies
  • Training
  • Health Insurance Programs
  • Medicare/Medicaid Programs
  • Consulting Services
  • Information Technology

Where Does the Money Go?

The government spends billions of dollars every year on hundreds of medical and healthcare contracts. The largest of these contracts typically go to drug companies, government health insurance programs and IT companies. In 2014, the Department of Health and Human Services spent $21.5 billion on healthcare-related products and services, a 6.6% increase over 2013[i]. Most of this money went to drug companies to pay for vaccines; although there has been a decline in the amount of money spent on pharmaceutical company contracts in recent years; top drug companies still make big bucks. According to healthcarefinancenews.com, Merck & Co. was the number one vendor for drug contracts in 2014, having been awarded $1.4 billion; behind Merck is Pfizer, who received $856 million in contracts, and GlaxoSmithKine, who came in fourth after receiving $767.9 million in contract dollars.

Some lucrative contracts unrelated to the pharmaceutical industry were awarded for IT and business management services. The top IT companies in terms of won contracts in 2014 were DynCorp International, which received $627 million and Lockheed Martin which was awarded $306.5 million. Livanta LLC was awarded $123.5 million in 2014 for a contract to help improve the quality of the dependent Medicare program - this brought the company from 527th place in terms of contract dollars won in 2013 up to 15th in 2014i.

Finding Medical and Healthcare Contracts

You can find thousands of open bids for medical and healthcare services across the United States at any given moment. On a daily basis, you’ll find contract opportunities published by states, counties, cities, agencies and departments. If you would like to narrow down the list of contracts and focus on a specific area, try searching for opportunities by agency or department. For state and local bids, check out the Department of Health or Department of Mental Health; for federal bids, research the Veteran’s Administration, Centers for Medicare and Medicaid, the Department of Health and Human Services, the Food and Drug Administration, Centers for Disease Control and Prevention, and the National Institute of Health. These are just a few of the areas you can search to find open contracts; each state, city, or town may have other departments that are specifically dedicated to administering medical and healthcare services. Check your state’s website to find a list of departments and agencies, as names tend to differ from state to state. This will provide you with more options to search if you have a specific product or service you sell, or if you want to sell to one particular agency.

There will always be a need for medical and healthcare services and supplies, and bidding on these opportunities can be lucrative for businesses of all sizes. These kinds of contracts can also provide opportunities to benefit from contract renewals or extensions, as medical services are often needed on an urgent basis. Also, it’s wise for vendors to take the time to get to know the different agencies that solicit for these types of services, as doing so can lead to direct invitations for future contracts.

Danielle Calamaras | BidNet.com



[i] S. Morse “HHS Spends $21.5 Billion on Healthcare Contracts in 2014” healtcarefinancenews.com 11 Mar. 2015. Web. 11 Apr. 2016

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Keep up to date with the evolving world of government bidding with tips, best practices, trends, research and observations. Let BidNet’s knowledge and experience work for you.

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