HHS awarded $76M for professional services over 10 years, with a significant portion going to MDRC

Contract Overview

Contract Amount: $76,169,387 ($76.2M)

Contractor: Mdrc

Awarding Agency: Department of Health and Human Services

Start Date: 2003-09-30

End Date: 2014-03-30

Contract Duration: 3,834 days

Daily Burn Rate: $19.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: OTHER PROFESSIONAL SERVICES

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10016, UNITED STATES OF AMERICA

State: New York Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $76.2 million to MDRC for work described as: OTHER PROFESSIONAL SERVICES Key points: 1. The contract's long duration suggests a need for sustained support in professional services. 2. The award to MDRC, a known research organization, indicates a focus on specialized expertise. 3. The 'All Other Professional, Scientific, and Technical Services' category is broad, potentially encompassing diverse needs. 4. The contract's cost-plus award fee structure incentivizes performance but requires careful monitoring. 5. The lack of small business set-aside may limit opportunities for smaller firms in this contract. 6. The contract was awarded under full and open competition, suggesting a robust bidding process.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its broad scope and long duration. The total award of $76.2 million over approximately 10 years averages to about $7.6 million annually. Without specific deliverables or performance metrics, it's difficult to assess value for money. However, the cost-plus award fee structure implies that the government aims to pay for performance, which can be a good mechanism if well-managed. Comparing this to similar broad professional services contracts is difficult without more granular data on the specific services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This suggests a competitive environment that should theoretically lead to better pricing and service quality. The number of bidders is not specified, but the 'full and open' designation implies a significant level of competition was sought.

Taxpayer Impact: A competitive award process generally benefits taxpayers by driving down costs and encouraging innovation from contractors vying for the business.

Public Impact

The primary beneficiaries are likely the various offices within the Department of Health and Human Services (HHS) that require professional, scientific, and technical support. The services delivered are broadly categorized as 'All Other Professional, Scientific, and Technical Services,' suggesting a wide range of potential support functions. The contract's primary geographic impact is likely within the Washington D.C. metropolitan area, where HHS headquarters are located, though services could be delivered remotely or at other federal sites. The workforce implications could involve the employment of researchers, analysts, consultants, and administrative staff by MDRC and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The broad nature of 'All Other Professional, Scientific, and Technical Services' could lead to scope creep if not managed tightly.
The Cost Plus Award Fee (CPAF) structure requires diligent oversight to ensure award fees are justified by performance and not simply granted.
The long contract duration (over 10 years) increases the risk of the contracted services becoming outdated or misaligned with evolving agency needs.
Lack of specific performance metrics in the provided data makes it hard to gauge the true effectiveness and efficiency of the services provided.
The absence of small business participation noted in the data could indicate missed opportunities for economic inclusion and diverse solutions.

Positive Signals

The contract was awarded through full and open competition, suggesting a robust selection process that likely identified a qualified contractor.
The selection of MDRC, a known research organization, implies a focus on specialized expertise and evidence-based support for HHS.
The Cost Plus Award Fee (CPAF) structure, while requiring oversight, is designed to incentivize high performance and achieve desired outcomes.
The long-term nature of the contract (over 10 years) suggests a stable and ongoing need for the services, indicating strategic planning by the agency.
The contract's significant value ($76M+) indicates a substantial commitment from HHS, likely for critical support functions.

Sector Analysis

This contract falls under the broad 'Professional, Scientific, and Technical Services' sector, which is a significant area of federal spending. This sector includes a wide array of services such as research and development, management consulting, environmental services, and IT consulting. Federal spending in this category is consistently high, reflecting the government's reliance on external expertise to fulfill its mission across various agencies. The specific NAICS code 541990, 'All Other Professional, Scientific, and Technical Services,' is a catch-all for services not classified elsewhere, indicating a diverse range of potential activities. Benchmarking is difficult without knowing the specific services rendered, but overall federal spending on professional services runs into hundreds of billions annually.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This means that the competition was open to all eligible firms, including large businesses. Consequently, there may be limited direct opportunities for small businesses to perform work under this specific contract, unless they are part of a subcontracting plan. The absence of a small business set-aside could mean that the nature of the services required was deemed more suitable for larger, established firms, or that the agency did not prioritize small business participation for this particular award. Further analysis would be needed to determine if subcontracting opportunities exist and are being utilized.

Oversight & Accountability

The primary oversight mechanism for this contract would be the contract administration by the Department of Health and Human Services (HHS), specifically the Office of the Assistant Secretary for Administration. The Cost Plus Award Fee (CPAF) structure inherently requires performance monitoring and evaluation to determine the award fee. Transparency would depend on HHS's policies regarding contract reporting and public access to performance information. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

HHS Administrative Support Contracts
Federal Professional Services Contracts
Government Research and Development Support
Management and Consulting Services
Technical Assistance Contracts

Risk Flags

Long contract duration may lead to service obsolescence.
CPAF structure requires diligent performance oversight.
Broad service category could indicate scope management challenges.
Lack of small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $76.2 million to MDRC. OTHER PROFESSIONAL SERVICES

Who is the contractor on this award?

The obligated recipient is MDRC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of the Assistant Secretary for Administration).

What is the total obligated amount?

The obligated amount is $76.2 million.

What is the period of performance?

Start: 2003-09-30. End: 2014-03-30.

What specific types of 'All Other Professional, Scientific, and Technical Services' were rendered under this contract?

The provided data categorizes this contract under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' This is a broad classification that can encompass a wide array of services not specified elsewhere. Without access to the contract's statement of work or task orders, it is impossible to determine the precise nature of the services provided. These could range from specialized research, data analysis, program evaluation, technical consulting, administrative support, or other highly specific professional services tailored to the needs of the Office of the Assistant Secretary for Administration within HHS. The long duration and significant value suggest these services were critical and ongoing for the agency.

How does the $76.2 million total award compare to similar contracts for professional services at HHS or other agencies?

Comparing the $76.2 million total award for this contract, spanning over 10 years (from 2003 to 2014), requires context regarding the specific services rendered. On an annual basis, this averages to approximately $7.6 million. Federal spending on professional services is vast, with many large, multi-year contracts awarded across agencies. For instance, large IT services contracts or major research grants can easily exceed this amount. However, for a contract under the 'All Other Professional, Scientific, and Technical Services' category, $7.6 million annually could represent a substantial investment, particularly if it involves highly specialized expertise or supports a critical agency function. Without knowing the exact deliverables and scope, a direct comparison to 'similar' contracts is difficult, but it falls within the range of significant, long-term service agreements common in the federal government.

What are the key risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude and duration?

The primary risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude ($76.2M over 10+ years) revolve around cost control and performance verification. For the government, the risk is that costs could escalate beyond initial projections, and the 'award fee' component, intended to incentivize performance, might be awarded too liberally without sufficient justification, leading to inflated overall costs. Contractor risk includes the potential for not meeting performance targets and thus not receiving the full award fee. Effective oversight is crucial; the government must have robust mechanisms to track costs, define clear performance metrics, and objectively evaluate performance to ensure the award fee is earned. The long duration also introduces risks related to potential obsolescence of services or misalignment with evolving agency needs, requiring proactive contract management and potential modifications.

What was MDRC's track record or reputation prior to and during the performance of this contract?

MDRC (Manpower Demonstration Research Corporation) is a well-regarded, non-partisan research organization focused on improving social and economic policy through rigorous evidence. Prior to and during the performance of this contract (2003-2014), MDRC had established a strong reputation for conducting large-scale, complex evaluations of social programs, particularly in areas like welfare reform, education, and workforce development. Their work is known for its methodological rigor and commitment to producing high-quality, objective findings. Given their specialization, it is plausible that HHS sought MDRC's expertise for research, evaluation, or analysis related to its programs or administrative functions. Their track record likely contributed to their selection for this significant federal contract.

How did the 'full and open competition' impact the pricing and quality of services obtained by HHS?

Awarding this contract under 'full and open competition' theoretically should have a positive impact on both pricing and quality. This procurement method allows any responsible source to submit a bid, fostering a competitive environment where multiple contractors vie for the award. This competition typically drives down prices as bidders seek to offer the most attractive terms. Furthermore, it allows the agency to select from the widest possible pool of qualified vendors, increasing the likelihood of finding a contractor capable of delivering high-quality services that best meet the agency's needs. While the specific number of bidders isn't provided, the 'full and open' designation suggests that HHS aimed to leverage market forces to secure the best value for taxpayer dollars.

What is the historical spending pattern for 'All Other Professional, Scientific, and Technical Services' at HHS?

Historical spending patterns for 'All Other Professional, Scientific, and Technical Services' (NAICS 541990) at HHS, and indeed across the federal government, generally show a significant and often increasing trend. Agencies frequently rely on external expertise for specialized tasks, research, analysis, and program support that fall outside their core in-house capabilities. This particular contract, awarded in 2003 and ending in 2014, represents a substantial portion of spending within this category for HHS during that period. Analyzing HHS's broader spending trends in professional services would reveal if this contract was an outlier or part of a consistent strategy to outsource such functions. Generally, the demand for these services is driven by evolving policy needs, complex program management, and the need for specialized technical skills.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 16 E 34TH ST FL 19, NEW YORK, NY, 10016

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $101,717,584

Exercised Options: $77,609,276

Current Obligation: $76,169,387

Timeline