Implementation Guidelines - Federal Transit Administration - U.S. ...

one contract, and bills clients for a
variety of services in one invoice.
Turnkey vendors offer a
prepackaged set of services to the
consortium for a fixed price. The
services typically include MRO,
laboratory, and collection sites. In
contrast, a service broker selects
individual service agents, defines
services to be provided, and negotiates
rates for the consortium.
The goal of using a C/TPA is to
make service contracting and monitoring
easier. Preferably, all service issues are
handled through a single contact person
working for the C/TPA. The C/TPA
should be accountable for the
performance and compliance of all
service agents. Transit agencies,
however, cannot legally delegate their
compliance responsibilities to their
C/TPA, since the employer remains
ultimately responsible for the agency’s
compliance.
FTA encourages transit agencies to
form or join consortia and to purchase
testing services from a TPA. State
departments of transportation have also
taken an aggressive role in promoting
the formation of consortia for use by the
small urban and rural programs they
administer. Exhibit 11-1 in the Sample
Documentation section at the end of this
chapter describes different examples of
state involvement in consortia
development.
Section 1. ADVANTAGES OF
CONSORTIA
Transit agencies that form or join
consortia generally do so for one or
more of the following reasons:
• Lower costs
• Greater expertise
• Reduced administrative burden
• Random Pool Maintenance and
Selection
• Reduced liability
• Confidentiality
Lower Costs. Because of overhead
(e.g., training, record keeping, reporting,
billing, and administrative activities)
collection sites, drug testing laboratories,
MROs, and SAPs incur smaller per unit
costs when they contract with large
employers than when they contract with
smaller, individual ones. Consequently,
a small employer may not be able to buy
some services. For example, a contract
for fewer than 10 tests per year may not
justify a laboratory’s proposal effort.
In the majority of cases, however,
services can be purchased even though
the price may be higher for small
employers. The per unit cost to an
organization purchasing fewer services
(for example, drug tests) may be
significantly greater than the per unit
costs to a large organization buying
more identical services.
A consortium allows several
organizations to combine their service
needs and buy in larger quantities for a
better price. In addition, spreading
administrative and other costs among
more agencies may further reduce the
total cost of drug and alcohol testing.
Actual savings are determined by: 1) the
number of consortium members; 2) the
total number of covered employees; 3)
the frequency of testing; and 4) the
extent of services provided. Savings
may be used to offset the cost of
employing a professional manager.
Chapter 11. Joining a Consortium 11-2 August 2002