HHS awards $127.9M to AdvanceMed for administrative management consulting services over 7 years

Contract Overview

Contract Amount: $12,792,713 ($12.8M)

Contractor: Advancemed Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2002-12-15

End Date: 2009-12-16

Contract Duration: 2,558 days

Daily Burn Rate: $5.0K/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 $12.8 million to ADVANCEMED CORPORATION for work described as: MEDICAL AND HEALTH STUDIES Key points: 1. The contract value of $127.9 million over 7 years indicates a significant investment in administrative management. 2. AdvanceMed Corporation secured this contract through full and open competition, suggesting a competitive bidding process. 3. The 'COST PLUS AWARD FEE' contract type introduces performance-based incentives, potentially driving efficiency but also requiring careful oversight. 4. The sector is administrative management and general management consulting, a broad category within government services.

Value Assessment

Rating: good

The contract's value of $127.9 million over approximately 7 years averages around $18.3 million annually. Without specific benchmarks for similar administrative management consulting contracts, it's difficult to definitively assess pricing, but the duration and scope suggest a substantial, albeit not exceptionally high, annual spend.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically fosters competitive pricing and allows for a wide range of potential contractors to bid. This method is designed to ensure the government receives the best value by considering all qualified sources.

Taxpayer Impact: Full and open competition generally leads to more favorable pricing for taxpayers compared to sole-source or limited competition contracts, as it encourages multiple bidders to offer competitive rates.

Public Impact

This contract supports administrative management and general management consulting services for the Centers for Medicare and Medicaid Services (CMS). The services provided likely impact the efficiency and effectiveness of CMS operations, which are critical to healthcare delivery in the US. AdvanceMed Corporation, as the awardee, will play a key role in shaping administrative processes within a major federal health agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can lead to cost overruns if not managed tightly.
The long duration of the contract (7 years) may limit flexibility to adapt to changing needs.
The specific deliverables and performance metrics for the award fee are not detailed, posing a potential oversight risk.

Positive Signals

Awarded through full and open competition, indicating a potentially competitive price.
The contract type incentivizes performance, which could lead to improved service delivery.
The long-term nature suggests a stable, ongoing need for these services.

Sector Analysis

The administrative management and general management consulting services sector is crucial for government operations, enabling agencies to function efficiently. Benchmarks for this sector vary widely based on the specific services, but contracts of this magnitude often involve complex program support or strategic planning.

Small Business Impact

The data does not indicate any specific set-asides for small businesses. The contract was awarded under full and open competition, suggesting that large businesses were likely the primary bidders and recipients.

Oversight & Accountability

The 'COST PLUS AWARD FEE' structure necessitates robust oversight from CMS to ensure that AdvanceMed Corporation meets performance objectives and that costs are reasonable. Regular reviews and audits would be essential to maintain accountability and taxpayer value.

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

Potential for cost overruns with Cost Plus Award Fee structure.
Long contract duration may reduce flexibility.
Lack of specific performance metrics in provided data.
No indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $12.8 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 $12.8 million.

What is the period of performance?

Start: 2002-12-15. End: 2009-12-16.

What specific administrative management challenges is CMS seeking to address with this contract, and how will AdvanceMed's services demonstrably improve efficiency or reduce costs?

The contract aims to enhance CMS's administrative management and general consulting capabilities. The effectiveness will be measured by the achievement of specific performance metrics tied to the award fee. Without detailed statements of work and performance reports, it's difficult to quantify the precise improvements in efficiency or cost reduction. Future analysis should focus on the outcomes achieved against the contract's objectives.

Given the 'Cost Plus Award Fee' structure, what mechanisms are in place to prevent potential cost overruns and ensure that award fees are genuinely tied to exceptional performance rather than routine

The 'Cost Plus Award Fee' structure requires stringent oversight from CMS. Mechanisms likely include detailed performance work statements, regular progress reviews, and clearly defined criteria for earning award fees. To prevent overruns, CMS must actively monitor costs against the base contract and ensure that any additional costs are justified and directly linked to achieving superior performance outcomes as defined in the contract.

How does the $127.9 million contract value compare to historical spending on similar administrative management consulting services by CMS or other federal agencies?

Comparing this $127.9 million contract value requires specific historical data for similar administrative management consulting services within CMS or comparable agencies. The average annual value of approximately $18.3 million suggests a significant, long-term engagement. Without direct comparative data, it's challenging to definitively state if this represents high, low, or average spending. Further research into agency procurement histories would be needed for a precise benchmark.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

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: $2,092,031

Exercised Options: $2,092,031

Current Obligation: $12,792,713

Parent Contract

Parent Award PIID: 500990009

IDV Type: IDC

Timeline