HHS awarded Westat $292.6M for R&D services over 8 years, with a significant portion for research and development
Contract Overview
Contract Amount: $292,608,437 ($292.6M)
Contractor: Westat, Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2002-06-27
End Date: 2010-12-31
Contract Duration: 3,109 days
Daily Burn Rate: $94.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: R&D-OTHER R & D-B RES
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850, UNITED STATES OF AMERICA
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $292.6 million to WESTAT, INC. for work described as: R&D-OTHER R & D-B RES Key points: 1. The contract's value suggests a substantial investment in research and development activities. 2. Westat, Inc. has been the sole awardee, indicating a long-term relationship for these services. 3. The duration of the contract (over 8 years) points to a sustained need for the services provided. 4. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed carefully. 5. The geographic location of the contractor in Maryland may have implications for local economic impact. 6. The absence of small business set-asides suggests larger prime contractors were anticipated or preferred.
Value Assessment
Rating: fair
This contract, valued at $292.6 million over more than 8 years, represents a significant investment by the Agency for Healthcare Research and Quality (AHRQ) in research and development. Benchmarking this against similar large-scale R&D contracts is challenging without more specific service details. However, the Cost Plus Fixed Fee (CPFF) contract type, while allowing for flexibility in research, carries inherent risks of cost escalation if not rigorously managed. The consistent award to a single entity over an extended period suggests a strong performance history or a highly specialized need.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. However, the fact that Westat, Inc. was the sole awardee for this substantial contract over its long duration implies either a highly competitive initial bidding process where Westat offered the best value, or that subsequent modifications or renewals were also competed or awarded to the incumbent based on performance. The long-term nature of the award could also indicate a specialized area where few companies possess the required expertise.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best possible price and quality through a wide range of potential providers. The sustained award to one contractor, however, warrants scrutiny to ensure continued value and prevent complacency.
Public Impact
The primary beneficiaries are likely researchers, policymakers, and the public who benefit from the insights and data generated through AHRQ's research initiatives. The services delivered encompass a broad range of research and development activities within the healthcare sector. The geographic impact is national, as the research findings are intended to inform healthcare practices and policies across the United States. Workforce implications include employment opportunities for researchers, analysts, and support staff at Westat, Inc. and potentially subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The CPFF contract type can incentivize cost overruns if not closely monitored.
- The long duration of the contract may reduce opportunities for new entrants and limit competitive pressure over time.
- Lack of specific performance metrics makes it difficult to assess the true value and impact of the R&D conducted.
Positive Signals
- Awarded through full and open competition, suggesting a competitive initial process.
- The sustained award to Westat, Inc. may indicate consistent quality and reliability in delivering complex R&D services.
- The significant funding allocated reflects a commitment to critical healthcare research and development.
Sector Analysis
This contract falls within the broader Research and Development (R&D) sector, specifically focusing on healthcare-related research. The market for healthcare R&D services is substantial, involving government agencies, private institutions, and pharmaceutical companies. AHRQ's spending on such contracts is crucial for advancing medical knowledge, improving healthcare delivery, and informing public health policy. Comparable spending benchmarks would depend on the specific nature of the R&D, but $292.6 million over eight years for a single, long-term contract is a significant allocation.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss=false, sb=false). This suggests that the scope of work was likely too large or specialized for small business participation as prime contractors, or that the competition was geared towards larger, established research organizations. There is no explicit information on subcontracting plans, but for a contract of this magnitude and duration, it is probable that Westat, Inc. utilized small businesses for specific support services, contributing to the broader small business ecosystem.
Oversight & Accountability
Oversight for this contract would primarily reside with the Agency for Healthcare Research and Quality (AHRQ), a component of the Department of Health and Human Services (HHS). As a Cost Plus Fixed Fee contract, rigorous financial oversight and performance monitoring are critical to ensure that costs remain reasonable and that the research objectives are met efficiently. Transparency would be facilitated through regular reporting requirements mandated by the contract. While specific Inspector General (IG) jurisdiction isn't detailed, the HHS OIG would likely have oversight authority over potential fraud, waste, or abuse related to this significant federal expenditure.
Related Government Programs
- National Institutes of Health (NIH) Research Grants
- Centers for Disease Control and Prevention (CDC) Research Programs
- Department of Veterans Affairs (VA) Health Services Research
- Agency for Toxic Substances and Disease Registry (ATSDR) Studies
Risk Flags
- Potential for cost overruns due to CPFF contract type.
- Lack of transparency on specific R&D deliverables and outcomes.
- Long-term sole-source award could reduce competitive pressure.
Tags
research-and-development, health-services-research, cost-plus-fixed-fee, full-and-open-competition, department-of-health-and-human-services, agency-for-healthcare-research-and-quality, westat-inc, maryland, large-contract, long-term-contract, healthcare-sector
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $292.6 million to WESTAT, INC.. R&D-OTHER R & D-B RES
Who is the contractor on this award?
The obligated recipient is WESTAT, INC..
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (Agency for Healthcare Research and Quality).
What is the total obligated amount?
The obligated amount is $292.6 million.
What is the period of performance?
Start: 2002-06-27. End: 2010-12-31.
What specific types of R&D services were provided under this contract?
The provided data indicates the contract was for 'R&D-OTHER R & D-B RES', suggesting a broad scope encompassing various research and development activities, potentially including basic research, applied research, and development of new healthcare methodologies or technologies. Without more granular data, the precise nature of the services remains general. However, given the awarding agency (AHRQ), it is highly probable that the research focused on improving the quality, safety, efficiency, and effectiveness of healthcare services in the United States. This could involve data analysis, survey design and implementation, health outcomes research, health services research, and the development of evidence-based guidelines for clinical practice and health policy.
How does the $292.6 million total award compare to AHRQ's typical R&D spending?
The total award of $292.6 million over approximately 8 years represents a substantial commitment to a single research entity by AHRQ. To provide a precise comparison, one would need to analyze AHRQ's historical annual budgets and their allocation towards R&D contracts. However, this figure suggests that this contract was a significant portion of AHRQ's research funding during its period of performance (2002-2010). AHRQ's mission is to produce evidence to make healthcare safer and improve its quality, affordability, and effectiveness, and contracts of this magnitude are necessary to support large-scale, long-term research endeavors that contribute to this mission.
What are the risks associated with a Cost Plus Fixed Fee (CPFF) contract of this duration?
The primary risk with a CPFF contract, especially one spanning over eight years, is the potential for cost overruns. While the 'fixed fee' component provides a ceiling for the contractor's profit, the 'cost plus' aspect means the government reimburses the contractor for allowable costs incurred. If project scope expands, unforeseen challenges arise, or if cost-containment measures are not rigorously enforced, the total cost to the government can exceed initial projections. For long-term R&D, where outcomes and methodologies can evolve, managing scope creep and ensuring efficient resource utilization is paramount to mitigate these risks and ensure the government receives good value for its investment.
What does the sole awardee status for Westat, Inc. imply about competition and contractor performance?
The fact that Westat, Inc. was the sole awardee for this contract over its entire duration (2002-2010) implies a sustained, long-term relationship. Initially, it was awarded under 'full and open competition,' suggesting that Westat was selected as the best value among multiple bidders at the outset. Over the subsequent years, if the contract was modified or extended, it might have been awarded on a sole-source basis due to the incumbent's established expertise, performance, and institutional knowledge, or through competitive processes where Westat consistently prevailed. This longevity suggests a high level of satisfaction with Westat's performance and capabilities in fulfilling AHRQ's complex R&D requirements.
What is the historical spending trend for similar R&D services at HHS?
Historical spending trends for similar R&D services at HHS are generally characterized by significant and sustained investments, reflecting the agency's broad mandate in public health, healthcare research, and biomedical innovation. Agencies like AHRQ, NIH, and CDC consistently award large contracts for research. While specific figures fluctuate annually based on budget appropriations and research priorities, the overall trend indicates a continuous need for external research support. Contracts like the one awarded to Westat are typical for large-scale, multi-year research projects that require specialized expertise and infrastructure, contributing to a substantial overall R&D expenditure within HHS.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1650 RESEARCH BLVD, ROCKVILLE, MD, 20850
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $293,795,136
Exercised Options: $292,608,437
Current Obligation: $292,608,437
Timeline
Start Date: 2002-06-27
Current End Date: 2010-12-31
Potential End Date: 2010-12-31 00:00:00
Last Modified: 2015-08-01
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