HHS awards $254M to AdvanceMed for Management Consulting, spanning 7 years
Contract Overview
Contract Amount: $25,462,470 ($25.5M)
Contractor: Advancemed Corporation
Awarding Agency: Department of Health and Human Services
Start Date: 2002-06-19
End Date: 2009-12-16
Contract Duration: 2,737 days
Daily Burn Rate: $9.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 21
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: MEDICAL AND HEALTH STUDIES
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $25.5 million to ADVANCEMED CORPORATION for work described as: MEDICAL AND HEALTH STUDIES Key points: 1. Significant contract value of $254.6 million. 2. Full and open competition was utilized. 3. Potential for cost overruns given the Cost Plus Award Fee structure. 4. Services fall under Administrative Management and General Management Consulting.
Value Assessment
Rating: fair
The contract's Cost Plus Award Fee structure allows for potential overruns if performance targets are exceeded. Benchmarking against similar management consulting contracts is difficult without specific performance metrics and award fee details.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, suggesting a robust price discovery process. However, the Cost Plus Award Fee pricing model introduces variability and potential for increased costs beyond initial estimates.
Taxpayer Impact: Taxpayer funds are utilized for management consulting services. The Cost Plus Award Fee structure necessitates careful monitoring to ensure value for money and prevent excessive spending.
Public Impact
Impacts Medicare and Medicaid services through administrative support. Long contract duration of over 7 years suggests a critical, ongoing need. Potential for performance-based incentives to drive efficiency, but also risk of higher costs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee structure can lead to higher-than-expected costs.
- Long contract duration increases exposure to potential inefficiencies.
- Lack of specific performance metrics makes value assessment challenging.
Positive Signals
- Full and open competition promotes market-based pricing.
- Award fee structure incentivizes strong performance.
- Contract supports critical health programs.
Sector Analysis
This contract falls within the professional, scientific, and technical services sector, specifically management consulting. Spending in this area is common across federal agencies for operational efficiency and program support.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The contract was awarded to AdvanceMed Corporation, and further analysis would be needed to determine if they are a small business or if subcontracting opportunities exist.
Oversight & Accountability
The Centers for Medicare and Medicaid Services (CMS) is responsible for oversight. The contract's duration and fee structure warrant regular performance reviews and audits to ensure accountability and cost control.
Related Government Programs
- Administrative Management and General Management Consulting Services
- Department of Health and Human Services Contracting
- Centers for Medicare and Medicaid Services Programs
Risk Flags
- Cost Plus Award Fee structure.
- Long contract duration.
- Lack of detailed performance metrics.
- Potential for scope creep.
- Limited transparency on award fee payouts.
Tags
administrative-management-and-general-ma, department-of-health-and-human-services, md, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $25.5 million to ADVANCEMED CORPORATION. MEDICAL AND HEALTH STUDIES
Who is the contractor on this award?
The obligated recipient is ADVANCEMED CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (Centers for Medicare and Medicaid Services).
What is the total obligated amount?
The obligated amount is $25.5 million.
What is the period of performance?
Start: 2002-06-19. End: 2009-12-16.
What specific management consulting services were provided, and how did they directly improve CMS operations or patient care?
The provided data categorizes the service as 'Administrative Management and General Management Consulting Services' (NAICS 541611). While the contract value is substantial, the specific deliverables and their impact on operational efficiency or patient outcomes are not detailed. Further analysis of contract performance reports would be necessary to understand the tangible benefits derived by CMS and taxpayers.
How effectively did the Cost Plus Award Fee structure manage costs and incentivize performance compared to other contract types?
The Cost Plus Award Fee (CPAF) structure aims to balance cost control with performance incentives. While it allows for flexibility and rewards high performance, it also carries a risk of cost overruns if not meticulously managed and monitored. Without access to the specific award fee criteria and the actual awarded fees, it's difficult to definitively assess its effectiveness in this instance. Benchmarking against similar CPAF contracts would be beneficial.
Given the 7-year duration, what mechanisms were in place to ensure the services remained relevant and cost-effective throughout the contract lifecycle?
Long-term contracts like this one require robust mechanisms for adaptation and value assurance. This typically includes regular performance reviews, potential for contract modifications to reflect changing needs, and strong government oversight. The Centers for Medicare and Medicaid Services would need to actively manage the contract, ensuring that the services provided continue to align with agency goals and that pricing remains competitive over the extended period.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services
Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 21
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Computer Sciences Corporation (UEI: 009581091)
Address: 15245 SHADY GROVE ROAD, ROCKVILLE, MD, 08
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $6,686,515
Exercised Options: $5,686,515
Current Obligation: $25,462,470
Parent Contract
Parent Award PIID: 500990009
IDV Type: IDC
Timeline
Start Date: 2002-06-19
Current End Date: 2009-12-16
Potential End Date: 2009-12-16 00:00:00
Last Modified: 2010-02-23
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