VA Laundry Service:

Consolidations and Competitive Sourcing Could Save Millions

GAO-01-61: Published: Nov 30, 2000. Publicly Released: Nov 30, 2000.

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The Department of Veterans Affairs (VA) runs 67 laundries that serve patients in its hospitals, nursing homes, and domiciliaries. Most of the operating costs for these laundries are for labor. VA could reduce these costs by closing 13 of its 67 facilities and moving those workloads to its underused laundries. VA could make more efficient use of its existing facilities and save money by closing costly laundries that require expensive renovations and new equipment. In addition, VA could make greater use of competitive sourcing to keep costs down. GAO's review of current VA laundry contracts showed that labor costs were significantly reduced. Furthermore, competing VA in-house services with the private sector would ensure that VA would receive the most efficient and lowest-cost laundry service.

Recommendation for Executive Action

  1. Status: Closed - Not Implemented

    Comments: VHA had developed and begun implementing a process in each network to identify and evaluate additional laundry consolidations, but has suspended that process pending the completion of a technical contract review by the Office of Acquisition and Materiel Management. VHA does not specify a date by which they intend to have the contract signed.

    Recommendation: The Acting Secretary for Veterans Affairs should require the Under Secretary for Health to direct the 22 Veterans Integrated Service Networks to (1) systematically assess each laundry to determine which option or combination of options--consolidation and competitive sourcing--would reduce costs while maintaining or improving quality, and (2) implement the most cost-effective option.

    Agency Affected: Department of Veterans Affairs

 

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