City Council
Report
City Council Meeting: March 24, 2026
Agenda Item: 4.H
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To: Mayor and City Council
From: Dana Brown, Human Resources Director, Human Resources Department Subject: Award RFP to and Authorize the City Manager to Enter into Agreements with USMD Direct, Inc., Southern California Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group, Inc. for Occupational Medical Testing Program (OMTP) Services for the Human Resources and Finance Departments
Recommended Action
Staff recommends the City Council.
1. Adopt a finding of no significant effect pursuant to Section 15061(b)(3) of the California Environmental Quality Act (CEQA) Guidelines
2. Award RFP to USMD Direct Inc., Southern California Permanente Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group Inc. to provide occupational medical testing services for the Human Resources and Finance Departments.
3. Authorize the City Manager to execute an agreement with USMD Direct Inc. in an amount not to exceed $297,000 (including a 15% contingency) for a total amount not to exceed $341,550 over a five-year period, with future year funding contingent on Council budget approval.
4. Authorize the City Manager to execute an agreement with Southern California Permanente Medical Group (Kaiser Permanente) in an amount not to exceed $565,110 (including a 15% contingency) for a total amount not to exceed $649,877 over a five-year period, with future year funding contingent on Council budget approval.
5. Authorize the City Manager to execute an agreement with Pacific Harbor Medical Group Inc. in an amount not to exceed $2,292,900 (including a 15% contingency) for a total amount not to exceed $2,636,835 over a five-year period, with future year funding contingent on Council budget approval.
Summary
The City of Santa Monica (City) currently engages two vendors to provide Occupational Medical Testing Program (OMTP) services for current employees and new hires for 2 of 5
both offsite and onsite service locations. In response to the existing contracts expiring on June 30, 2026, the Human Resources Department is seeking to execute agreements for Occupational Medical Testing Program services. Following the competitive Request for Proposal (RFP) process, staff recommends awarding RFP #464 to three vendors:
USMD Direct Inc., Southern California Permanente Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group Inc.
Pacific Harbor Medical Group Inc. has been selected as the main service provider for the full scope of occupational medical testing services. Southern California Permanente Medical Group (Kaiser Permanente) has been selected as an additional service provider, offering convenient service locations throughout Southern California, to service select new hire preemployment medical testing. USMD Direct Inc., the third highest scoring respondent, has been selected to provide onsite mobile services, which allows active employees to reduce the time away from work while obtaining services.
Awarding to three vendors allows greater flexibility for new hires to visit convenient locations throughout Southern California and allows the City the pivot if one vendor abruptly ceases business operations or terminates our contract in the future, which has previously occurred.
Discussion
The Human Resources and Finance Departments coordinate the OMTP with assistance from operating departments and rely on private medical providers to carry out the testing required by the program. To comply with state and federal regulations, the City is required to provide employees in certain classifications with services such as commercial driver medical examinations, Peace Officer Standards and Training (POST) medical examinations, hazmat physicals, tuberculosis screenings, respirator medical clearance, and various vaccinations. In addition, as part of the OMTP, all job candidates offered employment in physically demanding positions undergo a preemployment physical exam. The City engages in onsite OMTP services such as commercial driver medical examinations, tuberculosis screenings, and various vaccinations to reduce the time employees spend completing the examination, resulting in lower operational burden for employees and the City.
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On November 24, 2025, staff issued RFP #464 for OMTP services. In response, staff recommends awarding to the three highest scoring vendors: USMD Direct Inc., Southern California Permanente Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group Inc.
Provider Selection
Bidder Recommendation
Best Qualified
Person/Firm
USMD Direct Inc, Southern California Permanente Medical Group (Kaiser Permanente), Pacific Harbor Medical Group Inc.
Evaluation Criteria
(include all that apply)
Compliance with service standards; Consultation services; Cost; Compliance with scope of work; Experience/references
Municipal Code SMMC 2.24.190
RFPs Received
Agile Occupational Medicine, PC Bio-Care, Inc. Southern California Permanente Medical Group
(Kaiser Permanente)
Pacific Harbor Medical Group Inc. USMD Direct, Inc.
RFP Data
Date Posted Posted On
Advertised In
(City Charter & SMMC)
Vendors
Downloaded
Date Publicly
Opened
11/24/2025
City’s Online
Bidding site:
OpenGov
Santa Monica Daily Press 23 1/12/2026
Justification to Award
Based on the criteria, the evaluation committee recommends awarding RFP 464 to the three highest-scoring respondents: USMD Direct Inc, Southern California Permanente Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group Inc. Pacific Harbor Medical Group Inc., the highest scoring respondent, is recommended as our main service provider who can provide the full scope of occupational medical testing services including fit-4-duty testing. Pacific Harbor Medical Group employs doctors with long-term experience providing occupational medical testing services. Southern California Permanente Medical Group (Kaiser Permanente), the second highest scoring respondent, is recommended as an additional provider offering convenient service locations throughout Southern California to service select new hire preemployment medical testing. USMD Direct Inc., the third highest scoring respondent, is recommended for onsite mobile services for active employees to reduce the time away from work while gaining services. USMD Direct Inc. was the lowest mobile provider with the smallest space needs to service employees onsite. Three vendors provide the full scope of services with greater flexibility for new hires to visit convenient locations throughout Southern California and allow the City the ability to pivot if one vendor ceases business operations or terminates our contract in the future. 4 of 5
Environmental Impact
The agreement for occupational medical services is exempt pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines, which states that CEQA does not apply, where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. The agreement would provide administrative services to the City and would not result in physical effects. Therefore, it can be seen with certainty that the contract would not result in adverse physical impacts on the environment, and as such, is exempt from CEQA.
Financial Impacts and Budget Actions
Staff seeks authority to approve available funding starting in fiscal year 2026-27 from the Risk Management, Workers' Compensation Fund to award agreements with USMD Direct Inc, Southern California Permanente Medical Group (Kaiser Permanente), and Pacific Harbor Medical Group Inc. to provide occupational medical testing services for the City’s employees and new hires.
Contract Request
Contract
FY 2025-26
Request
Amount
FY 2026-27
Request
Amount
Future Year
Modified
Request Amount
Department
Account #
Total
Contract
Amount
USMD Direct Inc. $0 $68,310 $273,240 74800002.552010 $341,550 Southern
California
Permanente
Medical Group
(Kaiser
Permanente)
$0 $129,975 $519,902 74800002.552010 $649,877
Pacific Harbor
Medical Group Inc. $0 $527,367 $2,109,468 74800002.552010 $2,636,835 Total $0 $725,652 $2,902,611 $3,628,262
Future year funding is contingent on Council budget approval. 5 of 5
Prepared By: Jennifer Garcia, Benefits Administrator
Approved Forwarded to Council
Attachments:
A. PHMG Oaks
B. PHMG_Levine Act Form
C. OAKS_INITIATIVE_FORM
D. Kaiser_Levine Act Form
E. USMD Oaks
F. USMD_Levine Act Form