Will Sequestration Affect My VA Schedule Contract?

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The Department of Veterans Affairs (VA) reminded readers of a special sequestration exclusion in their March 2013 eNewsletter.  A special rule exempts all programs administered by VA (including VA Medical Care) from sequestration (but not federal pay or “federal administrative expenses”).  Due to this exemption, VA programs such as the Federal Supply Schedule (FSS) Service will not be impacted by budget cuts. Other government agencies are not so lucky.  Unless exempt or subject to special rules, 2013 sequestration reductions are uniform by category for accounts and “programs, projects and activities” within accounts.  In 2013, the budget sequester will enact $85.4 billion in cuts with a total of $109 billion in cuts through FY2021.

The VA FSS Program supports the healthcare requirements of the VA and other federal government agencies (OGA) under delegation from GSA. VA explains that the exemption is a direct result of the importance of the Department’s mission and the essential services and critical care provided to veterans.  The VA FSS program allows eligible ordering activities to place orders directly with Schedule contractors (commercial suppliers) for delivery worldwide of medical equipment, supplies, services, and pharmaceuticals.  Sales of healthcare products and services via the VA FSS program to VA facilities and other government agencies (OGA) customers total $10 billion annually.

$42.7b Defense cuts; $28.7b domestic discretionary spending; $9b Medicare; $4b other mandatory cutsWhile the Department’s programs are not impacted by sequestration budget cuts, other government agencies – civilian and defense spending, mandatory and discretionary programs- are affected, in some cases substantially, under sequestration.  While no programs will be eliminated as a result of these cuts, sequestration will change the scale and scope of existing programs — significantly impacting federal government operations – including federal acquisition programs.

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About Vanessa Payne


Ms. Payne is an Senior Consultant in Aronson LLC’s Government Contract Solutions Group. She guides clients through the GSA schedule contract process – from acquisition through administration and compliance. She also works with clients to develop and expand their federal market sales by analyzing the federal market and identifying opportunities. Additionally, Ms. Payne specializes in organizational procedure and policy review, improvement and standardization. Ms. Payne has over 14 years of government contracts and consulting experience including contract and subcontract administration, and providing efficiency and cost solutions – via business process reengineering (BPR), activity based costing (ABC) / cost accounting, market research, and facilitation services – to federal government, commercial, and interdepartmental clients. Ms. Payne holds a M.S. in Organizational Development / Strategic Human Resources from Johns Hopkins University, a post-baccalaureate Graduate Certificate in Skilled Facilitation from Johns Hopkins University, and a B.A. in Communications from the University of Pennsylvania.

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