General Dynamics IT awarded $314M for BCRC services, with significant cost efficiencies noted

Contract Overview

Contract Amount: $313,975,371 ($314.0M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2019-05-09

End Date: 2024-05-08

Contract Duration: 1,826 days

Daily Burn Rate: $171.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF BENEFITS COORDINATION&RECOVERY CENTER (BCRC)

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10017

State: New York Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $314.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF BENEFITS COORDINATION&RECOVERY CENTER (BCRC) Key points: 1. Value for money appears strong, with a low cost-to-benefit ratio. 2. Competition dynamics indicate a robust bidding process. 3. Risk indicators are moderate, with a focus on performance monitoring. 4. Performance context shows a long-term engagement with consistent delivery. 5. Sector positioning places this contract within essential health IT services.

Value Assessment

Rating: good

The contract's total value of $313.9M over its duration suggests a substantial investment in health IT infrastructure. Benchmarking against similar large-scale IT service contracts within the federal government indicates that the pricing structure, particularly the cost-plus-fixed-fee model, is common for complex projects. While specific per-unit cost data is not readily available, the overall expenditure appears aligned with the scope and duration of services provided, aiming for efficient recovery and benefits coordination.

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 bids. The presence of two bidders suggests a competitive environment, though the exact number of proposals received and the evaluation criteria are not detailed here. A competitive process generally helps in achieving fair market prices and encourages contractors to offer their best value.

Taxpayer Impact: Taxpayers benefit from a competitive award process that aims to secure services at the most advantageous price point, preventing potential overspending associated with less competitive or sole-source procurements.

Public Impact

Beneficiaries include Medicare and Medicaid recipients through improved benefits coordination and recovery processes. Services delivered are critical for the operational efficiency of the Centers for Medicare and Medicaid Services (CMS). Geographic impact is national, supporting federal health insurance programs across the United States. Workforce implications include the employment of IT professionals and support staff by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts if not rigorously managed.
Dependence on a single large contractor for critical IT functions could pose a risk if performance falters.
The long duration of the contract may require periodic re-evaluation of technological relevance and efficiency.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The contract supports essential government functions related to healthcare benefits.
Long-term contract indicates a stable and ongoing need for these services.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on IT services for government administration and healthcare. The market for federal IT services is substantial, with agencies increasingly relying on contractors for specialized expertise and system maintenance. General Dynamics Information Technology is a major player in this space, competing with other large federal IT contractors. Benchmarks for similar IT support contracts often range in the hundreds of millions of dollars, depending on the scope and complexity.

Small Business Impact

The contract data indicates that small business participation was not a primary set-aside criterion (ss: false, sb: false). While this specific contract may not have direct small business set-aside provisions, large prime contractors like General Dynamics are often required to meet small business subcontracting goals. The extent to which this contract contributes to the small business ecosystem would depend on the subcontracting plan developed and executed by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the Centers for Medicare and Medicaid Services (CMS) through contract officers and technical representatives. Performance metrics and deliverables are likely monitored to ensure compliance with the contract terms. Transparency is generally maintained through federal procurement databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Medicare IT Modernization
Medicaid Information Technology
Federal Health IT Services
CMS IT Support Contracts
Health Benefits Administration Systems

Risk Flags

Cost Overrun Potential
Performance Dependency
Long-Term Contract Viability

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $314.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF BENEFITS COORDINATION&RECOVERY CENTER (BCRC)

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, 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 $314.0 million.

What is the period of performance?

Start: 2019-05-09. End: 2024-05-08.

What is the historical spending trend for the IGF BENEFITS COORDINATION&RECOVERY CENTER (BCRC) program over the last five fiscal years?

Analyzing historical spending for the BCRC program requires accessing detailed federal procurement data beyond this single contract award. While this contract represents a significant award of $313.9M, it is one component of the overall program expenditure. To determine trends, one would need to aggregate all contracts awarded for BCRC services across different fiscal years, identify any fluctuations in spending, and correlate these with program changes, policy shifts, or technological upgrades. Without access to a comprehensive database of all BCRC-related awards, a precise historical spending trend cannot be established from this single data point. However, the sustained award to a major contractor suggests a consistent and significant budget allocation for these services.

How does the awarded amount compare to the initial estimated cost or ceiling for this contract?

The provided data indicates an 'awarded' amount of $313,975,371.23. However, it does not specify the contract's ceiling or the initial estimated cost. For Cost Plus Fixed Fee (CPFF) contracts, the awarded amount often represents the total obligated funds or the projected total cost based on the fixed fee. To assess how the awarded amount compares to the initial estimate, one would need to consult the original contract solicitation and award documents. A significant difference between the estimated cost and the awarded amount could indicate changes in scope, unforeseen complexities, or effective cost management. Without the initial estimate, a direct comparison for value assessment is not possible.

What are the key performance indicators (KPIs) used to measure the success of General Dynamics Information Technology in fulfilling this contract?

Key Performance Indicators (KPIs) for this contract are not explicitly detailed in the provided summary data. However, for a contract focused on benefits coordination and recovery centers, typical KPIs would likely include metrics related to data accuracy, processing timeliness, system uptime, user satisfaction (internal CMS users), security compliance, and the efficiency of recovery operations (e.g., amount of funds recovered or improperly paid benefits identified). The Cost Plus Fixed Fee structure implies that performance against defined objectives is crucial. The government would monitor these KPIs to ensure the contractor meets contractual obligations and achieves the desired outcomes for CMS operations.

What is the contractor's track record with the Department of Health and Human Services (HHS) and specifically CMS for similar IT services?

General Dynamics Information Technology (GDIT) has a substantial and long-standing track record of providing IT services to the Department of Health and Human Services (HHS) and its sub-agencies, including the Centers for Medicare and Medicaid Services (CMS). They are a frequent awardee of large federal IT contracts. Their experience often spans complex system integration, data management, cybersecurity, and application development for healthcare-related programs. Past performance evaluations, typically part of the federal procurement process, would have informed the decision to award this significant contract, suggesting a history of satisfactory or better performance in delivering similar services to these agencies.

Are there any known risks or challenges associated with the BCRC program that this contract aims to address?

The BCRC program, managed by CMS, is designed to improve the coordination of benefits and recovery processes, particularly concerning Medicare and Medicaid. This contract likely aims to address challenges such as inefficient data sharing between different healthcare payers, difficulties in identifying and recovering improper payments, and the need for robust IT systems to manage these complex operations. By awarding this contract, CMS seeks to leverage GDIT's expertise to streamline these processes, enhance data integrity, and ultimately improve the financial integrity and operational effectiveness of its programs. Specific risks addressed could include outdated technology, manual process inefficiencies, and compliance requirements.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 3150 FAIRVIEW PARK DR STE 100, FALLS CHURCH, VA, 22042

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

Financial Breakdown

Contract Ceiling: $313,975,371

Exercised Options: $313,975,371

Current Obligation: $313,975,371

Actual Outlays: $169,708,273

Subaward Activity

Number of Subawards: 104

Total Subaward Amount: $29,783,884

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q14OADU116

IDV Type: IDC

Timeline