DoD's $22.2M Soldier's Benefits Services Support contract awarded to Magellan Federal, Inc. for HR consulting
Contract Overview
Contract Amount: $22,256,471 ($22.3M)
Contractor: Magellan Federal, Inc.
Awarding Agency: Department of Defense
Start Date: 2014-09-02
End Date: 2019-08-13
Contract Duration: 1,806 days
Daily Burn Rate: $12.3K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: SOLDIER'S BENEFITS SERVICES SUPPORT IGF::CL,CT::IGF
Place of Performance
Location: ARLINGTON, ALEXANDRIA CITY County, VIRGINIA, 22206
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $22.3 million to MAGELLAN FEDERAL, INC. for work described as: SOLDIER'S BENEFITS SERVICES SUPPORT IGF::CL,CT::IGF Key points: 1. The contract value of $22.2 million over five years suggests a significant investment in human resources support for soldiers. 2. Awarded under full and open competition, this indicates a market with multiple capable providers. 3. The fixed-price contract type shifts performance risk to the contractor, potentially leading to cost efficiencies if managed well. 4. The duration of 1806 days (approx. 5 years) allows for sustained support but also requires careful performance monitoring. 5. The North American Industry Classification System (NAICS) code 541612 points to specialized human resources consulting services. 6. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle.
Value Assessment
Rating: good
The contract's value of $22.2 million over approximately five years for HR consulting services appears reasonable given the scope of supporting soldier benefits. Benchmarking against similar large-scale HR support contracts within the Department of Defense would provide a more precise value-for-money assessment. The firm fixed-price structure is generally favorable for the government when requirements are well-defined, as it caps costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that the Department of the Army sought proposals from all responsible sources. This approach typically fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The presence of robust competition is a positive indicator for price discovery and achieving fair market value.
Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces and ensuring that the government receives proposals from a wide range of qualified contractors, potentially leading to better service at a lower cost.
Public Impact
Soldiers and their families benefit from improved access to and administration of critical benefits and HR services. The contract supports the delivery of human resources consulting services essential for personnel management within the Army. The geographic impact is likely nationwide, supporting soldiers across various installations and potentially remote locations. Workforce implications include the potential for Magellan Federal to employ a significant number of HR specialists and support staff.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for scope creep if initial requirements are not clearly defined, leading to cost overruns despite fixed-price.
- Reliance on contractor performance for timely and accurate delivery of critical soldier benefits information.
- Ensuring data security and privacy for sensitive soldier information handled by the contractor.
Positive Signals
- Awarded through full and open competition, indicating a competitive bidding process.
- Firm Fixed Price contract type aligns incentives for contractor efficiency.
- Long-term contract duration allows for stability and continuity of essential services.
Sector Analysis
This contract falls within the professional, scientific, and technical services sector, specifically focusing on human resources consulting. The federal government is a major consumer of such services to manage its large workforce and complex benefit structures. Comparable spending benchmarks would involve analyzing other large HR support contracts awarded by federal agencies, particularly within the Department of Defense, to assess the scale and pricing of similar engagements.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded under full and open competition, it is unlikely to have significant direct subcontracting opportunities specifically targeted at small businesses unless Magellan Federal voluntarily includes them in their proposal. The primary impact on the small business ecosystem would be indirect, through potential competition for future, smaller HR support contracts.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Army contracting officer and their representatives (CORs). Performance monitoring, quality assurance, and invoice verification are standard oversight mechanisms. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.
Related Government Programs
- Army Human Resources Command Support Contracts
- Department of Defense HR Consulting Services
- Military Personnel Benefits Administration
- Federal Workforce Management Services
Risk Flags
- Performance Risk
- Cost Overrun Potential
- Data Security Concerns
- Contract Scope Definition
Tags
department-of-defense, department-of-the-army, human-resources, consulting-services, firm-fixed-price, full-and-open-competition, delivery-order, professional-services, soldier-support, virginia, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $22.3 million to MAGELLAN FEDERAL, INC.. SOLDIER'S BENEFITS SERVICES SUPPORT IGF::CL,CT::IGF
Who is the contractor on this award?
The obligated recipient is MAGELLAN FEDERAL, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $22.3 million.
What is the period of performance?
Start: 2014-09-02. End: 2019-08-13.
What is the track record of Magellan Federal, Inc. in performing similar government contracts, particularly within the Department of Defense?
Magellan Federal, Inc. has a history of performing government contracts, including those related to human resources and administrative support. While specific details on past performance for contracts of this exact scale and nature require deeper analysis of contract databases and performance reviews, their award by the Department of the Army suggests they possess the necessary qualifications and experience. A thorough review would involve examining past performance evaluations, any reported disputes or contract terminations, and the types of services previously rendered to government clients to fully assess their track record.
How does the $22.2 million contract value compare to similar HR consulting services contracts awarded by the DoD or other federal agencies?
The $22.2 million contract value over approximately five years for Soldier's Benefits Services Support is substantial, indicating a significant scope of work. To benchmark this value, one would compare it against other large-scale HR consulting and support contracts awarded by the Department of Defense or other federal agencies. Factors such as the number of personnel supported, the complexity of benefits administered, and the specific services required (e.g., technology integration, policy development) influence pricing. Without direct comparisons of contracts with identical service levels and durations, it's challenging to definitively state if this represents a premium or discount, but the value suggests a comprehensive service requirement.
What are the primary risks associated with this firm fixed-price contract, and how are they mitigated?
The primary risk with a firm fixed-price (FFP) contract is that the contractor may incur costs exceeding the agreed-upon price, potentially leading to performance issues or financial distress if not managed effectively. Conversely, the government risks paying a premium if the contractor's actual costs are significantly lower than anticipated. Mitigation strategies include robust performance monitoring by the government to ensure quality and adherence to scope, clear definition of requirements in the contract to prevent scope creep, and potentially including incentive clauses or performance metrics. The contractor's own risk management practices are also crucial for successful execution.
What is the expected effectiveness of Magellan Federal's services in improving soldier benefits administration and support?
The expected effectiveness hinges on Magellan Federal's ability to deliver on the contract's objectives, which likely include streamlining processes, improving accessibility to benefits information, and ensuring timely processing of claims and inquiries for soldiers. Success will be measured by key performance indicators (KPIs) established within the contract, such as response times, accuracy rates, and user satisfaction surveys from soldiers. The government's oversight and the contractor's commitment to quality service delivery are critical factors in achieving the desired effectiveness and ensuring soldiers receive the support they are entitled to.
What have been the historical spending patterns for Soldier's Benefits Services Support or similar HR functions within the Department of the Army?
Historical spending patterns for Soldier's Benefits Services Support and similar HR functions within the Department of the Army would reveal trends in contract values, durations, and types of services procured over time. Analyzing past awards for these services can indicate whether spending has been consistent, increasing, or decreasing, and whether there has been a shift towards outsourcing these functions. Understanding these patterns helps in assessing the current $22.2 million award in the context of long-term budgetary priorities and the evolution of HR service delivery within the Army.
How does the competition level (full and open) for this contract potentially influence the quality and cost of services received by the Army?
A full and open competition environment generally fosters a higher quality of services and potentially lower costs for the Army. By allowing all responsible sources to bid, the Army can leverage a wider pool of expertise and innovation. This competitive pressure encourages bidders to offer their most competitive pricing and robust technical solutions to win the contract. The presence of multiple bidders allows the Army to compare different approaches and select the offer that provides the best overall value, balancing cost, technical merit, and past performance, thereby enhancing the likelihood of receiving high-quality, cost-effective services.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Human Resources Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Magellan Health, Inc. (UEI: 049693732)
Address: 2800 S SHIRLINGTON RD STE 350, ARLINGTON, VA, 22206
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business
Financial Breakdown
Contract Ceiling: $26,152,203
Exercised Options: $22,256,471
Current Obligation: $22,256,471
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W91WAW11D0018
IDV Type: IDC
Timeline
Start Date: 2014-09-02
Current End Date: 2019-08-13
Potential End Date: 2019-08-13 12:08:00
Last Modified: 2020-06-15
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