DoD awards $89.4M for Pharmacy Benefit Management to Wisconsin Physicians Service Insurance Corp
Contract Overview
Contract Amount: $89,369,262 ($89.4M)
Contractor: Wisconsin Physicians Service Insurance Corp.
Awarding Agency: Department of Defense
Start Date: 2009-07-01
End Date: 2010-06-30
Contract Duration: 364 days
Daily Burn Rate: $245.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIXED PRICE INCENTIVE
Sector: Healthcare
Official Description: OBLIGATES FUNDS FOR THE FIRST 3 MONTHS OF OPTION 2, FY09.
Place of Performance
Location: MONONA, DANE County, WISCONSIN, 53713
Plain-Language Summary
Department of Defense obligated $89.4 million to WISCONSIN PHYSICIANS SERVICE INSURANCE CORP. for work described as: OBLIGATES FUNDS FOR THE FIRST 3 MONTHS OF OPTION 2, FY09. Key points: 1. The contract is for the first 3 months of Option 2, indicating ongoing services. 2. Wisconsin Physicians Service Insurance Corp. is the sole awardee for this delivery order. 3. The contract type is Fixed Price Incentive, suggesting shared risk between government and contractor. 4. The sector is Defense Healthcare, a critical area for military personnel and families.
Value Assessment
Rating: good
The award amount of $89.4M for 3 months of Option 2 suggests a significant ongoing program. Benchmarking against similar Pharmacy Benefit Management contracts would be necessary for a precise value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which generally promotes competitive pricing. However, this specific award is a delivery order under a larger contract, so the initial competition's effectiveness is key.
Taxpayer Impact: The competitive award process aims to ensure taxpayer funds are used efficiently for essential healthcare services.
Public Impact
Ensures continued pharmacy benefit management for eligible beneficiaries. Supports the health and readiness of military personnel and their families. Impacts the cost and accessibility of prescription medications for a significant population.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Option period award may indicate potential for cost growth if not managed effectively.
- Fixed Price Incentive contracts require careful monitoring of performance and cost targets.
Positive Signals
- Awarded under full and open competition.
- Supports a critical defense healthcare function.
Sector Analysis
This contract falls within the Defense Healthcare sector, specifically focusing on Pharmacy Benefit Management. Spending in this area is substantial and directly impacts the well-being of service members and their families.
Small Business Impact
The data does not indicate if small businesses were involved in this specific delivery order or the parent contract. Further analysis would be needed to determine small business participation.
Oversight & Accountability
Oversight would involve monitoring contractor performance against contract requirements, ensuring cost controls are effective, and verifying that the services provided meet the needs of the Defense Health Agency.
Related Government Programs
- Pharmacy Benefit Management and Other Third Party Administration of Insurance and Pension Funds
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Potential for cost overruns in Fixed Price Incentive contracts.
- Dependence on a single contractor for critical PBM services.
- Need for robust performance monitoring to ensure service quality.
- Limited visibility into the overall contract lifecycle from this data.
Tags
pharmacy-benefit-management-and-other-th, department-of-defense, wi, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $89.4 million to WISCONSIN PHYSICIANS SERVICE INSURANCE CORP.. OBLIGATES FUNDS FOR THE FIRST 3 MONTHS OF OPTION 2, FY09.
Who is the contractor on this award?
The obligated recipient is WISCONSIN PHYSICIANS SERVICE INSURANCE CORP..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $89.4 million.
What is the period of performance?
Start: 2009-07-01. End: 2010-06-30.
What was the total value and duration of the original contract under which this option was exercised?
The provided data only details the current delivery order for Option 2. To fully assess the value and long-term implications, information on the original contract's total value, duration, and previous option periods is crucial. This context helps understand the overall investment and commitment.
How does the per-unit cost of pharmacy benefits under this contract compare to industry benchmarks?
Without specific per-unit cost data (e.g., cost per prescription filled, administrative fee per member per month), a direct comparison to industry benchmarks is not possible. A detailed cost analysis would be required, examining negotiated rates for drugs and administrative services against market averages.
What mechanisms are in place to ensure the effectiveness and efficiency of the Pharmacy Benefit Management services provided?
Effectiveness is likely ensured through performance metrics and Service Level Agreements (SLAs) within the contract. Efficiency would be monitored through cost-effectiveness analyses, audits, and potentially by comparing the contractor's performance against other PBMs or internal benchmarks over time.
Industry Classification
NAICS: Finance and Insurance › Agencies, Brokerages, and Other Insurance Related Activities › Pharmacy Benefit Management and Other Third Party Administration of Insurance and Pension Funds
Product/Service Code: MEDICAL SERVICES › OTHER MEDICAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 1717 W BROADWAY, MADISON, WI, 53713
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $89,391,518
Exercised Options: $89,391,518
Current Obligation: $89,369,262
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: H9400207D0001
IDV Type: IDC
Timeline
Start Date: 2009-07-01
Current End Date: 2010-06-30
Potential End Date: 2014-12-31 00:00:00
Last Modified: 2015-12-29
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