HHS awards $93M contract for Medicare ACO program support, with a focus on operational analysis

Contract Overview

Contract Amount: $93,112,929 ($93.1M)

Contractor: Research Triangle Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2021-09-01

End Date: 2026-08-31

Contract Duration: 1,825 days

Daily Burn Rate: $51.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION (ACO) PROGRAM ANALYSIS AND OPERATIONAL SUPPORT

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27709

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $93.1 million to RESEARCH TRIANGLE INSTITUTE for work described as: MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION (ACO) PROGRAM ANALYSIS AND OPERATIONAL SUPPORT Key points: 1. Contract aims to enhance the effectiveness and efficiency of the Medicare Shared Savings Program. 2. Focus on data analysis and operational support for Accountable Care Organizations (ACOs). 3. Potential for significant impact on healthcare delivery and patient outcomes through ACO performance. 4. Contract duration of five years suggests a long-term commitment to program improvement. 5. The administrative management and general management consulting services category indicates a need for expert guidance. 6. Geographic focus on North Carolina for this specific award, though program impact is national.

Value Assessment

Rating: good

The contract value of $93.1 million over five years for administrative and operational support of the Medicare ACO program appears reasonable given the scope. Benchmarking against similar large-scale healthcare program support contracts suggests this is within expected parameters. The 'Time and Materials' pricing model, while offering flexibility, requires careful monitoring to ensure cost-effectiveness and prevent scope creep. The specific value-for-money will depend on the demonstrable improvements in ACO performance and cost savings achieved through the contractor's efforts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of two bidders suggests a competitive environment, which generally leads to better pricing and service offerings for the government. The specific details of the bidding process and the evaluation criteria would provide further insight into the strength of the competition and its impact on the final award.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it fosters a competitive environment, driving down costs and encouraging innovation, ultimately leading to more efficient use of public funds.

Public Impact

Beneficiaries include Medicare beneficiaries who will experience improved care coordination and quality through more effective ACOs. Services delivered include analytical support, operational guidance, and program management for ACOs. Geographic impact is national, as the ACO program aims to improve healthcare across the United States, although this specific award is managed from North Carolina. Workforce implications include potential support for healthcare professionals within ACOs and the contractor's own analytical and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if Time and Materials pricing is not closely managed.
Dependence on contractor's expertise for successful program outcomes.
Ensuring data security and patient privacy in handling sensitive healthcare information.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Contract duration indicates a strategic investment in program improvement.
Focus on a critical healthcare initiative (Medicare ACOs) with potential for significant public health benefits.

Sector Analysis

The healthcare sector, particularly within government programs, relies heavily on administrative and analytical support to manage complex initiatives like the Medicare Shared Savings Program. This contract fits within the broader market for health information technology and healthcare consulting services. Comparable spending benchmarks in this area are difficult to pinpoint without specific service details, but large federal contracts for program management and analysis often range in the tens to hundreds of millions of dollars over their lifecycle.

Small Business Impact

The data provided does not indicate any specific small business set-aside or subcontracting requirements for this contract. As it was awarded through full and open competition, the primary focus was likely on large, capable contractors. Further analysis would be needed to determine if the prime contractor has plans for small business subcontracting, which could impact the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Centers for Medicare and Medicaid Services (CMS), a division of HHS. Accountability measures will be tied to the performance metrics and deliverables outlined in the contract. Transparency will be facilitated through contract award databases and potentially through public reporting on ACO program performance. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Medicare Shared Savings Program
Accountable Care Organization (ACO) Program
Centers for Medicare and Medicaid Services (CMS) Initiatives
Healthcare Program Management Support
Federal Healthcare Analytics Contracts

Risk Flags

Time and Materials pricing model requires close monitoring to ensure cost control.
Contract performance is critical to the success of the Medicare ACO program.
Data security and patient privacy are paramount concerns in healthcare contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $93.1 million to RESEARCH TRIANGLE INSTITUTE. MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION (ACO) PROGRAM ANALYSIS AND OPERATIONAL SUPPORT

Who is the contractor on this award?

The obligated recipient is RESEARCH TRIANGLE INSTITUTE.

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 $93.1 million.

What is the period of performance?

Start: 2021-09-01. End: 2026-08-31.

What is the track record of Research Triangle Institute (RTI) in supporting federal healthcare programs, particularly those related to ACOs?

Research Triangle Institute (RTI) has a substantial track record in supporting federal health initiatives, including work with CMS and other agencies on program evaluation, data analysis, and operational support. While specific details on their involvement with ACO programs would require deeper investigation into their contract history, RTI is generally recognized for its expertise in health services research and public health program implementation. Their experience likely encompasses similar analytical and administrative tasks required for managing complex healthcare delivery models. A review of their past performance on contracts with similar scope and objectives would provide a clearer picture of their capabilities and past successes in this domain.

How does the awarded amount of $93.1 million compare to previous contracts for similar Medicare ACO program support?

Direct comparison of this $93.1 million award to previous contracts for identical Medicare ACO program support is challenging without specific historical data on comparable sole-source or competitively awarded contracts for the same scope. However, considering the five-year duration and the breadth of administrative and operational support implied, the annual average of approximately $18.6 million appears to be within a reasonable range for large-scale federal program management. Factors such as evolving program requirements, inflation, and the number of ACOs supported would influence year-over-year spending. A comprehensive analysis would involve examining historical contract awards for ACO program support over the past decade to identify trends and establish a more precise benchmark.

What are the primary risks associated with this contract, and what mitigation strategies are likely in place?

Key risks for this contract include potential cost overruns due to the Time and Materials (T&M) pricing structure, contractor underperformance impacting ACO effectiveness, and data security/privacy breaches. Mitigation strategies likely include robust contract oversight by CMS, clearly defined performance metrics and deliverables, regular progress reviews, and strict adherence to data security protocols. The T&M model necessitates vigilant monitoring of labor hours and rates to ensure value for money. Contractor performance risk is managed through performance-based incentives or penalties outlined in the contract. Data security is addressed through compliance with HIPAA and other relevant regulations, and potentially through specific security audits.

How will the success of this contract be measured in terms of improving the Medicare ACO program's effectiveness and efficiency?

The success of this contract will be measured through a combination of quantitative and qualitative metrics tied to the performance of the Medicare ACO program. Key performance indicators (KPIs) will likely include improvements in quality of care scores for participating ACOs, reductions in the rate of preventable hospital readmissions, decreases in overall healthcare costs for Medicare beneficiaries served by ACOs, and increased ACO participation and success rates. The contractor's ability to provide timely and actionable data analysis, effective operational support, and strategic guidance that leads to demonstrable improvements in these areas will be critical. Regular performance reviews and reporting will track progress against these defined objectives.

What is the historical spending trend for administrative and operational support of the Medicare ACO program?

Historical spending on administrative and operational support for the Medicare ACO program has generally trended upwards as the program has matured and expanded. Initial years likely saw lower spending focused on program setup and initial guidance. As more ACOs have joined and the program has evolved, the need for sophisticated data analytics, performance monitoring, and ongoing operational support has increased, driving higher contract values. Specific figures would require a detailed analysis of historical CMS contract awards related to the ACO program. Factors such as legislative changes, payment model adjustments, and the overall growth in ACO participation directly influence spending levels.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management 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: RFQ210787

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 3040 CORNWALLIS RD, DURHAM, NC, 27709

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

Financial Breakdown

Contract Ceiling: $93,498,225

Exercised Options: $93,112,929

Current Obligation: $93,112,929

Actual Outlays: $65,108,496

Subaward Activity

Number of Subawards: 13

Total Subaward Amount: $5,147,040

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00F354CA

IDV Type: FSS

Timeline