HHS awards $230.9M for health insurance exchange public education and outreach

Contract Overview

Contract Amount: $230,880,849 ($230.9M)

Contractor: IPG Dxtra, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2019-06-14

End Date: 2022-06-13

Contract Duration: 1,095 days

Daily Burn Rate: $210.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: HEALTH INSURANCE EXCHANGE PUBLIC EDUCATION AND OUTREACH AWARD

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $230.9 million to IPG DXTRA, INC. for work described as: HEALTH INSURANCE EXCHANGE PUBLIC EDUCATION AND OUTREACH AWARD Key points: 1. Contract awarded to IPG DXTRA, INC. for public education and outreach services. 2. The contract duration is 3 years, ending in June 2022. 3. Services are categorized under Advertising Agencies (NAICS 541810). 4. The contract was awarded through full and open competition. 5. The contract type is Time and Materials. 6. The award was made by the Centers for Medicare and Medicaid Services (CMS). 7. The primary place of performance is Washington D.C.

Value Assessment

Rating: fair

The total award amount of $230.9 million over three years for public education and outreach services appears substantial. Benchmarking this against similar large-scale public awareness campaigns would be necessary to determine value for money. The Time and Materials contract type can sometimes lead to cost overruns if not closely managed, suggesting a need for diligent oversight to ensure efficient spending. Without specific performance metrics or comparable contract data, a definitive assessment of value is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the process suggests a competitive environment. Full and open competition is generally expected to drive better pricing and service offerings as vendors vie for the contract.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that aims to secure the most cost-effective solution for essential public outreach services.

Public Impact

The primary beneficiaries are individuals seeking health insurance coverage through the exchanges. Services delivered include public education and outreach campaigns to inform consumers. The geographic impact is national, aiming to reach a broad audience across the United States. Workforce implications may include jobs in advertising, marketing, and public relations within the contractor's organization and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost uncertainty if not managed tightly.
Lack of specific performance metrics makes it difficult to assess effectiveness and value.
Large contract value necessitates robust oversight to ensure efficient use of funds.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Services are critical for informing the public about health insurance options.
Contract awarded to a known entity in the advertising and marketing space.

Sector Analysis

The advertising and public relations sector is highly competitive, with numerous firms capable of executing large-scale public awareness campaigns. This contract falls within the broader professional services category, specifically focusing on marketing and communication. The market size for government public outreach contracts is significant, driven by the need to inform citizens about various programs and initiatives. This award represents a substantial investment in communicating complex health insurance information.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. As a large contract awarded through full and open competition, it is possible that IPG DXTRA, INC. may engage small businesses as subcontractors to fulfill certain aspects of the work. However, without explicit subcontracting plans or goals, the direct impact on the small business ecosystem is unclear.

Oversight & Accountability

Oversight for this contract would typically fall under the Centers for Medicare and Medicaid Services (CMS), a division of HHS. The contract's Time and Materials nature requires diligent monitoring of hours and costs to prevent overspending. Transparency would be enhanced by public reporting of campaign performance metrics and expenditures. The Inspector General's office for HHS would have jurisdiction to investigate any potential fraud, waste, or abuse.

Related Government Programs

Affordable Care Act (ACA) Implementation
Health Insurance Marketplace
Public Health Campaigns
Government Advertising Contracts

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Difficulty in precisely measuring campaign effectiveness and ROI.
Need for strong oversight to manage scope and ensure value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $230.9 million to IPG DXTRA, INC.. HEALTH INSURANCE EXCHANGE PUBLIC EDUCATION AND OUTREACH AWARD

Who is the contractor on this award?

The obligated recipient is IPG DXTRA, INC..

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 $230.9 million.

What is the period of performance?

Start: 2019-06-14. End: 2022-06-13.

What is the track record of IPG DXTRA, INC. in managing large federal public outreach contracts?

IPG DXTRA, INC., part of the Interpublic Group of Companies, has a significant history in advertising and marketing. While specific details on their past federal contracts for public outreach are not immediately available in this data, their parent company's scale suggests experience with large-scale campaigns. A deeper dive into their federal contract history, particularly with agencies like HHS or other public-facing departments, would be necessary to fully assess their track record. This would involve examining past performance evaluations, contract values, and the types of services rendered to determine their proficiency in managing similar federal initiatives and their ability to meet government requirements effectively.

How does the $230.9 million award compare to similar public education and outreach contracts by federal agencies?

The $230.9 million award for health insurance exchange public education and outreach is a substantial figure, indicative of a large-scale, national campaign. To benchmark its value, comparisons should be made with other significant federal public awareness initiatives, such as those for public health (e.g., CDC campaigns), social security, or other major legislative outreach efforts. Factors like campaign duration, target audience size, complexity of the message, and the media channels employed would influence cost. Without specific comparable contract data, it's difficult to definitively state if this represents high or low value, but it is certainly within the range of major government communication efforts.

What are the primary risks associated with a Time and Materials contract of this magnitude for public outreach?

The primary risk with a Time and Materials (T&M) contract of this magnitude ($230.9 million) for public outreach is the potential for cost escalation if not rigorously managed. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours and materials used. This can lead to unpredictable final costs if the scope of work expands, inefficiencies arise, or the project duration extends beyond initial estimates. For public outreach, defining and controlling the 'effort' can be challenging, increasing the risk of scope creep. Robust oversight, detailed tracking of hours and expenses, and clear performance milestones are crucial to mitigate these risks and ensure taxpayer funds are used efficiently.

How effective are public education and outreach campaigns in influencing health insurance enrollment?

The effectiveness of public education and outreach campaigns in influencing health insurance enrollment is generally considered significant, though difficult to quantify precisely. These campaigns play a crucial role in raising awareness about available insurance options, explaining enrollment periods, and demystifying the process, particularly for individuals who may be uninsured or underinsured. Success is often measured by metrics such as website traffic, call center volume, and ultimately, enrollment numbers. Factors influencing effectiveness include the campaign's reach, clarity of messaging, targeting of specific demographics, and the overall economic and policy environment surrounding health insurance. While direct attribution can be complex, such campaigns are a vital tool for government agencies to achieve policy objectives.

What is the historical spending trend for public education and outreach by the Centers for Medicare and Medicaid Services (CMS)?

Historical spending trends for public education and outreach by CMS are likely substantial, given the agency's mission to administer Medicare, Medicaid, and the Health Insurance Marketplace. The Affordable Care Act (ACA) significantly increased the need for such outreach to inform the public about new insurance options and enrollment procedures. While specific year-over-year figures for this particular contract are not provided, it is reasonable to assume that CMS has consistently allocated significant resources to public awareness campaigns, especially during open enrollment periods. Analyzing past budgets and contract awards related to ACA outreach would provide a clearer picture of the historical spending trajectory in this area.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Advertising, Public Relations, and Related Services › Advertising Agencies

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 75FCMC18R0006

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 909 3RD AVE FL 7, NEW YORK, NY, 10022

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $280,880,840

Exercised Options: $230,880,849

Current Obligation: $230,880,849

Actual Outlays: $127,169,096

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75FCMC18D0046

IDV Type: IDC

Timeline