HHS awards $24.1M for physician cost measure development, with Acumen LLC as prime

Contract Overview

Contract Amount: $24,133,919 ($24.1M)

Contractor: Acumen LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2019-09-15

End Date: 2024-09-14

Contract Duration: 1,826 days

Daily Burn Rate: $13.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: MEASURE AND INSTRUMENT DEVELOPMENT AND SUPPORT (MIDS) PHYSICIAN COST MEASURE AND PATIENT RELATIONSHIP CODES (PCMP) TASK ORDER

Place of Performance

Location: BURLINGAME, SAN MATEO County, CALIFORNIA, 94010

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $24.1 million to ACUMEN LLC for work described as: MEASURE AND INSTRUMENT DEVELOPMENT AND SUPPORT (MIDS) PHYSICIAN COST MEASURE AND PATIENT RELATIONSHIP CODES (PCMP) TASK ORDER Key points: 1. Contract focuses on developing and supporting physician cost measures and patient relationship codes. 2. Acumen LLC, the prime contractor, has a significant role in this task order. 3. The contract duration is 5 years, indicating a long-term need for these services. 4. The award was made under full and open competition, suggesting a robust bidding process. 5. The task order is a delivery order under a larger contract vehicle. 6. The North American Industry Classification System (NAICS) code 541690 points to specialized consulting services.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contract data. The total award amount of $24.1 million over five years suggests a moderate annual spend. The pricing structure, likely time and materials, can lead to cost overruns if not managed carefully. Further analysis would require understanding the scope of work and the deliverables against the cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but this method generally fosters price discovery and allows the government to select the most advantageous offer. The competitive nature suggests that Acumen LLC's proposal was deemed the best value.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down costs through market forces and ensures a wider range of solutions are considered, leading to potentially better value for public funds.

Public Impact

Beneficiaries include healthcare providers who will use the developed cost measures. The services delivered will enhance the accuracy and utility of physician cost reporting. The geographic impact is national, as Medicare and Medicaid programs operate across the US. Workforce implications include the need for specialized analysts and consultants in healthcare economics and data management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep due to Time and Materials pricing structure if not closely monitored.
Dependence on a single contractor for a critical task order over a long duration.
Scope definition clarity is crucial to ensure deliverables meet evolving healthcare policy needs.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Long-term contract (5 years) suggests sustained government need and potential for stable service delivery.
Focus on physician cost measures aligns with government efforts to improve healthcare value and transparency.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on healthcare consulting. The market for healthcare analytics and consulting is substantial, driven by regulatory changes and the push for value-based care. Comparable spending benchmarks would involve other contracts for developing healthcare quality and cost metrics, which are common within agencies like CMS.

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 subcontracting opportunities specifically targeted at small businesses unless mandated by the prime contractor. The focus is on specialized technical expertise, which may favor larger, established firms.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS). Accountability measures are typically embedded in the contract's performance work statement, with regular reviews and reporting requirements. Transparency is facilitated through contract award databases, though detailed performance data may be internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Physician Payment Sunshine Act
Medicare Quality Payment Program
Healthcare Cost and Utilization Project (HCUP)
Value-Based Purchasing Programs

Risk Flags

Potential for scope creep due to T&M contract type.
Long-term reliance on a single vendor for critical measure development.
Need for robust government oversight to manage costs and ensure deliverable quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $24.1 million to ACUMEN LLC. MEASURE AND INSTRUMENT DEVELOPMENT AND SUPPORT (MIDS) PHYSICIAN COST MEASURE AND PATIENT RELATIONSHIP CODES (PCMP) TASK ORDER

Who is the contractor on this award?

The obligated recipient is ACUMEN LLC.

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 $24.1 million.

What is the period of performance?

Start: 2019-09-15. End: 2024-09-14.

What is the specific nature of the 'physician cost measure and patient relationship codes' being developed?

The 'MEASURE AND INSTRUMENT DEVELOPMENT AND SUPPORT (MIDS) PHYSICIAN COST MEASURE AND PATIENT RELATIONSHIP CODES (PCMP) TASK ORDER' implies the development of methodologies and tools to accurately capture and report the costs associated with physician services. This likely includes defining how patient relationships (e.g., continuity of care, complexity of conditions) influence these costs. These measures are crucial for CMS's initiatives like the Quality Payment Program (QPP) and value-based purchasing, aiming to link provider payments to the quality and cost of care delivered. The development process would involve defining metrics, data collection instruments, and analytical frameworks to ensure these codes are reliable, valid, and relevant for policy implementation and provider feedback.

How does Acumen LLC's track record compare for similar government contracts?

Acumen LLC has a history of performing government contracts, particularly within the health and human services sector. While specific details on past performance for similar measure development contracts are not provided in this data snippet, their presence as a prime contractor suggests they possess the requisite expertise and experience. A deeper dive into their contract history, including past performance evaluations and any awards or penalties, would be necessary for a comprehensive assessment. However, being awarded a $24.1 million, 5-year task order under full and open competition indicates a level of established capability and trust from the awarding agency.

What are the primary risks associated with this contract's Time and Materials (T&M) pricing structure?

The primary risk associated with a Time and Materials (T&M) pricing structure, as indicated by 'pt': 'TIME AND MATERIALS', is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual labor hours and material costs incurred. If the scope of work is not precisely defined, or if project management is weak, the contractor may incur more hours or use more expensive materials than initially anticipated, leading to a higher final cost than budgeted. For the government, this necessitates robust oversight, diligent monitoring of labor hours, and strict adherence to the contract's ceiling to mitigate financial risk and ensure value for money.

How does this contract align with broader CMS goals for healthcare cost transparency?

This contract directly aligns with CMS's strategic goals to enhance healthcare cost transparency and promote value-based care. By developing and supporting physician cost measures and patient relationship codes, CMS aims to provide a more accurate picture of healthcare spending and provider performance. These measures are foundational for initiatives that incentivize providers to deliver high-quality, cost-effective care. Improved cost measurement allows for better comparisons between providers, informs policy decisions regarding payment models, and empowers patients and payers with more information to make informed healthcare choices. The development of these instruments is a critical step in operationalizing CMS's commitment to a more efficient and accountable healthcare system.

What is the historical spending trend for similar measure development contracts at CMS?

Historical spending on measure and instrument development contracts at CMS can fluctuate based on evolving healthcare policies, regulatory requirements, and the introduction of new payment models. Agencies like CMS consistently invest in developing and refining quality and cost measures to support programs such as the Quality Payment Program (QPP), Hospital Value-Based Purchasing, and Accountable Care Organizations. While specific historical data for this exact task order isn't provided, it's reasonable to assume that CMS allocates significant resources annually to such initiatives. The $24.1 million award over five years represents a substantial, but not necessarily atypical, investment in maintaining and advancing the infrastructure for measuring healthcare performance and cost.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Scientific and Technical Consulting Services

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: 75FCMC18R0019

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 500 AIRPORT BLVD STE 100, BURLINGAME, CA, 94010

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

Financial Breakdown

Contract Ceiling: $27,071,973

Exercised Options: $24,133,919

Current Obligation: $24,133,919

Actual Outlays: $13,929,669

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 75FCMC18D0015

IDV Type: IDC

Timeline