OPM awards $18.8M task order to Deloitte for Postal Service Health Benefits System support

Contract Overview

Contract Amount: $18,806,540 ($18.8M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Office of Personnel Management

Start Date: 2025-07-03

End Date: 2026-08-20

Contract Duration: 413 days

Daily Burn Rate: $45.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: POSTAL SERVICE HEALTH BENEFITS SYSTEM TASK ORDER 2

Place of Performance

Location: DALLAS, DALLAS County, TEXAS, 75207

State: Texas Government Spending

Plain-Language Summary

Office of Personnel Management obligated $18.8 million to DELOITTE CONSULTING LLP for work described as: POSTAL SERVICE HEALTH BENEFITS SYSTEM TASK ORDER 2 Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract is a firm-fixed-price delivery order, providing cost certainty for the government. 3. The duration of 413 days indicates a medium-term project requiring sustained effort. 4. The primary NAICS code (541511) points to custom computer programming services. 5. The awardee, Deloitte Consulting LLP, is a large, established federal contractor. 6. The contract value is moderate, falling within typical ranges for IT support services.

Value Assessment

Rating: good

The contract value of $18.8 million for a 413-day period for custom computer programming services appears reasonable. Benchmarking against similar IT support contracts for large federal systems suggests this pricing is within expected parameters. The firm-fixed-price structure helps manage cost overruns, contributing to good value for money. Further analysis would require detailed scope of work comparison and labor rate benchmarking.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The specific number of bidders is not provided, but this method generally fosters price discovery and encourages competitive pricing. The use of full and open competition suggests the agency sought the best possible solution and price from the market.

Taxpayer Impact: Taxpayers benefit from the competitive nature of this award, as it is designed to drive down costs and ensure the government receives optimal value for its investment in critical IT services.

Public Impact

Federal employees and annuitants enrolled in the Postal Service Health Benefits Program will benefit from continued system support. The contract ensures the ongoing functionality and maintenance of the health benefits system, critical for managing healthcare enrollment and benefits. The services delivered are primarily IT-focused, supporting the operational needs of the Office of Personnel Management. The geographic impact is national, as the Postal Service Health Benefits Program serves a nationwide population. Workforce implications are primarily within Deloitte Consulting LLP, with potential for specialized IT roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific bidder count limits assessment of competitive intensity.
Scope of work details are not provided, making a precise value assessment challenging.
Performance metrics and success criteria are not detailed, hindering evaluation of effectiveness.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Firm-fixed-price contract provides cost certainty and reduces financial risk for the government.
Awardee has significant experience in federal contracting, suggesting capability.
Contract supports a critical federal program (Postal Service Health Benefits System).

Sector Analysis

This contract falls within the IT services sector, specifically custom computer programming. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading complex systems. This task order for the Postal Service Health Benefits System is a component of the broader healthcare IT landscape within the federal government, requiring specialized knowledge of benefits administration and data management. Comparable spending benchmarks for similar system maintenance and development contracts can vary widely based on complexity and duration.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded to a major contractor, it is unlikely that significant subcontracting opportunities for small businesses will be mandated, though the prime contractor may engage them. This award does not directly contribute to the small business contracting goals of the agency.

Oversight & Accountability

Oversight for this contract will primarily reside with the Office of Personnel Management (OPM), the contracting agency. As a task order under a larger contract vehicle, the specific oversight mechanisms will be defined within the task order itself and the parent contract. Transparency is facilitated by public contract databases, but detailed performance reviews and Inspector General involvement would depend on specific performance issues or audits.

Related Government Programs

Federal Employee Health Benefits Program (FEHBP)
Healthcare IT Systems
Custom Software Development
IT Support Services
Benefits Administration Systems

Risk Flags

Potential for vendor lock-in if custom solutions are highly proprietary.
Dependence on a single large contractor for critical system functionality.
Risk of underestimation of complexity leading to cost or schedule overruns despite fixed price.

Frequently Asked Questions

What is this federal contract paying for?

Office of Personnel Management awarded $18.8 million to DELOITTE CONSULTING LLP. POSTAL SERVICE HEALTH BENEFITS SYSTEM TASK ORDER 2

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Office of Personnel Management (Office of Personnel Management).

What is the total obligated amount?

The obligated amount is $18.8 million.

What is the period of performance?

Start: 2025-07-03. End: 2026-08-20.

What is Deloitte Consulting LLP's track record with the Office of Personnel Management and similar health benefits systems?

Deloitte Consulting LLP is a major federal contractor with a long history of providing IT and consulting services across numerous government agencies, including OPM. While specific details on their past performance solely on the Postal Service Health Benefits System are not provided in this data, their extensive experience with large-scale IT projects and benefits administration systems for federal entities suggests a strong capability. OPM's past performance evaluations, often documented in contract award histories and potentially available through federal procurement data systems, would offer a more granular view of their specific successes and challenges with the agency. Generally, large firms like Deloitte are expected to have robust project management and technical expertise, but individual contract performance can vary.

How does the $18.8 million value compare to similar IT support contracts for federal health benefits systems?

The $18.8 million value for a 413-day task order for custom computer programming services for a health benefits system is within a moderate range for federal IT projects of this nature. Large-scale federal IT systems, especially those dealing with sensitive data and complex user bases like health benefits, often require significant investment for maintenance, upgrades, and support. Contracts for similar services can range from a few million to tens or even hundreds of millions of dollars depending on the scope, duration, and complexity. This specific award appears to be for a defined period of support rather than a full system development lifecycle, making direct comparison challenging without more detailed scope information. However, it does not appear to be an outlier in terms of cost for its intended purpose.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential scope creep, technical challenges in maintaining a complex system, contractor performance issues, and cybersecurity threats. Scope creep is mitigated by the firm-fixed-price contract type, which incentivizes the contractor to adhere to the defined scope. Technical challenges are managed through the contractor's expertise (Deloitte) and OPM's technical oversight. Contractor performance is monitored by OPM, and cybersecurity risks are addressed through standard federal security protocols and contractual requirements. Delays in delivery or performance shortfalls could impact the seamless operation of the health benefits system, affecting beneficiaries.

How effective is the Postal Service Health Benefits System, and how does this contract contribute to its effectiveness?

The effectiveness of the Postal Service Health Benefits System is crucial for ensuring that postal employees and annuitants receive accurate and timely healthcare benefits. This contract directly contributes to its effectiveness by providing necessary custom computer programming services for maintenance, updates, and potentially enhancements. The system's effectiveness relies on its ability to accurately manage enrollment, process claims information, and provide beneficiaries with access to their benefit details. By ensuring the system's technical integrity and functionality, this contract supports OPM's mission to administer these vital benefits efficiently and reliably.

What are the historical spending patterns for the Postal Service Health Benefits System IT support?

Historical spending patterns for IT support of the Postal Service Health Benefits System are not detailed in the provided data. However, federal agencies typically allocate significant and consistent funding towards maintaining and upgrading critical IT infrastructure like health benefits systems. Spending often fluctuates based on system modernization needs, regulatory changes, and contract renewals. To understand historical patterns, one would need to examine OPM's budget allocations and contract awards related to this specific system over several fiscal years. Such analysis would reveal trends in investment and identify periods of significant upgrades or sustained maintenance.

What is the significance of the NAICS code 541511 (Custom Computer Programming Services) in the context of this contract?

The NAICS code 541511 signifies that the primary service being procured under this contract is the creation, modification, and support of custom computer software. This indicates that the work involves developing new code, adapting existing software to meet specific requirements of the Postal Service Health Benefits System, or providing specialized programming expertise to resolve technical issues. It differentiates this contract from those focused solely on off-the-shelf software, IT infrastructure management, or general IT consulting, highlighting a need for tailored software solutions to support the unique functions of the health benefits system.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

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

Financial Breakdown

Contract Ceiling: $28,499,964

Exercised Options: $18,806,540

Current Obligation: $18,806,540

Actual Outlays: $8,801,164

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $257,414

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 24322623D0018

IDV Type: IDC

Timeline