A company supplying eyewear to veterans is under fire for allegedly winning a contract with the Department of Veterans Affairs (VA) by submitting an artificially low bid, then making up that money on the backs of veterans through aggressive sales tactics and higher prices.
Nestled in the heart of Kentucky, PDS Consultants, a company helmed by U.S. veterans, secured a lucrative five-year contract in November 2022 to provide eyewear and optician services to VISN 7, a network of VA clinics and healthcare facilities spanning Georgia, Alabama, and South Carolina. However, the path to that contract has raised eyebrows, with accusations of dubious bidding practices and a subsequent increase in complaints surrounding the quality and cost of eyeglasses for veterans.
To secure the VISN 7 contract, PDS Consultants submitted a bid of less than $10 million, significantly undercutting the bids of its competitors, Superior Optical and Carter-Lambert, which hovered around $30 million and $40 million, respectively. This lowballing tactic, according to sources close to the VA, was a deliberate strategy to win the contract and later compensate for the financial shortfall.
VA Contractor Accused of Lowballing Bid, Overcharging Veterans for Eyeglasses
Former employees of Superior Optical, now working for PDS Consultants, have reported feeling pressured to upsell veterans and meet unrealistic monthly sales targets. An anonymous source likened the situation to a "bait-and-switch," alleging that PDS Consultants was making up the lost revenue through "unbalanced" pricing.
Court filings reveal that PDS Consultants proposed pricing where some products, such as lenses, were offered well below market rate, while others, such as add-ons and upgrades, were significantly overpriced. Despite concerns raised by the contracting officer regarding the disparity in pricing, these unbalanced prices were deemed not to pose an "unacceptable risk of overpayment."
VA Contractor Accused of Lowballing Bid, Overcharging Veterans for Eyeglasses
The source close to the VA claimed that eyeglasses under PDS Consultants' stewardship have plummeted in quality, from high-end Ray-Bans to Walmart-grade products. "The veterans were getting very poorly crafted, poorly made, eyeglass products," the source said, adding that delivery times have skyrocketed.
Another source alleged that veterans' options for free frames and lenses have diminished since PDS Consultants took over. The company reportedly offers the "worst of the worst" brands for free and charges exorbitant fees for upgrades, forcing veterans to pay more out of pocket.
VA Contractor Accused of Lowballing Bid, Overcharging Veterans for Eyeglasses
Despite the VA's previous claim of not receiving complaints against PDS Consultants, the source contradicted this, asserting that complaints have surged since the company assumed the VISN 7 contract. This contradicts the VA's statement to Fox News Digital that it has not received any direct complaints.
The VA's Secretary Hayes denied the allegations, stating that the agency holds contractors accountable for meeting standards and may terminate contracts if they fail to do so. However, the source remained adamant that the VA received more complaints about PDS Consultants than all previous contractors combined.
VA Contractor Accused of Lowballing Bid, Overcharging Veterans for Eyeglasses
Hayes maintained that prescription eyeglasses are provided to veterans at no cost and that any out-of-pocket expenses are for specialty lenses or specific brands. He also said that the VA pays for remakes in cases of manufacturing errors or breakage.
PDS Vice President Rob Yopps defended the company's performance, stating that Veteran owners are proud to serve the Nation's Veterans. He declined to comment on the bidding strategy, but said that PDS follows VA guidelines.
Meanwhile, Superior Optical has filed a lawsuit in the Court of Federal Claims, protesting the awarding of the contract to PDS Consultants. Oral arguments for the case are scheduled for late July.
