CMS awards $20.2M contract for Medicare Modernization Program support to NAVA PBC

Contract Overview

Contract Amount: $20,201,632 ($20.2M)

Contractor: Nava PBC

Awarding Agency: Department of Health and Human Services

Start Date: 2022-09-23

End Date: 2025-09-22

Contract Duration: 1,095 days

Daily Burn Rate: $18.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CMS NEEDS A TEAM TO LEAD THE MEDICARE MODERNIZATION PROGRAM IN THE AREAS OF DEVSECOPS, INFRASTRUCTURE SUPPORT, AND TECHNICAL COORDINATION WITH SEVERAL APPLICATION DEVELOPMENT ORGANIZATION (ADO) TEAMS. MANAGEMENT OF VIRTUAL PRIVATE CLOUDS, NETWORKS,

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $20.2 million to NAVA PBC for work described as: CMS NEEDS A TEAM TO LEAD THE MEDICARE MODERNIZATION PROGRAM IN THE AREAS OF DEVSECOPS, INFRASTRUCTURE SUPPORT, AND TECHNICAL COORDINATION WITH SEVERAL APPLICATION DEVELOPMENT ORGANIZATION (ADO) TEAMS. MANAGEMENT OF VIRTUAL PRIVATE CLOUDS, NETWORKS, Key points: 1. Contract focuses on critical DevSecOps, infrastructure, and technical coordination for Medicare modernization. 2. The award was made under a full and open competition, suggesting a competitive bidding process. 3. The contract duration of 1095 days indicates a significant, long-term need for these services. 4. The firm-fixed-price contract type aims to control costs and provide budget certainty. 5. This spending supports the ongoing modernization of the Medicare program, impacting millions of beneficiaries. 6. The contract is managed by the Centers for Medicare and Medicaid Services (CMS).

Value Assessment

Rating: good

The contract value of $20.2 million over three years for comprehensive IT modernization support appears reasonable. Benchmarking against similar large-scale federal IT modernization contracts, which often run into tens or hundreds of millions, suggests this is within a typical range for the scope of work. The firm-fixed-price structure provides cost predictability for the government. Without specific per-unit cost data or detailed breakdowns of services, a precise value-for-money assessment is challenging, but the overall price seems aligned with the complexity and duration of supporting a program as critical as Medicare.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all eligible responsible sources were permitted to submit a bid. The presence of 4 bidders (as suggested by 'no': 4) implies a healthy level of competition for this significant IT modernization effort. A competitive process like this generally leads to better price discovery and potentially more innovative solutions as contractors vie for the award.

Taxpayer Impact: A full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple companies competed to offer the best value. This process helps prevent inflated pricing and encourages contractors to be competitive.

Public Impact

Beneficiaries of the Medicare program will benefit from improved system stability, security, and functionality resulting from modernization efforts. The contract delivers essential IT services including DevSecOps, infrastructure support, and technical coordination. The geographic impact is national, as Medicare serves beneficiaries across the United States. The contract supports a specialized IT workforce, potentially creating or sustaining jobs in cybersecurity, cloud infrastructure, and software development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if specific technologies or platforms become deeply integrated.
Reliance on a single contractor for critical modernization functions could pose a risk if performance falters.
Scope creep could increase costs if the definition of 'modernization' expands beyond initial expectations.

Positive Signals

Firm-fixed-price contract type helps mitigate cost overruns.
Full and open competition suggests a robust selection process and potential for competitive pricing.
The contract duration indicates a stable, long-term commitment to modernizing a vital federal program.

Sector Analysis

This contract falls within the Custom Computer Programming Services sector, a critical component of the broader IT services industry. The federal government is a significant consumer of these services, particularly for large-scale modernization efforts of legacy systems. The market for DevSecOps, cloud infrastructure management, and technical coordination is highly competitive, with numerous large and small firms offering specialized expertise. This contract represents a portion of the government's ongoing investment in digital transformation and maintaining the operational integrity of essential public services like Medicare.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While NAVA PBC is a small business, the contract itself was competed broadly. There is no explicit information on subcontracting plans for small businesses within this award. The impact on the broader small business ecosystem would depend on whether NAVA PBC utilizes small business subcontractors, which is not detailed here.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. Performance will be monitored against the contract's deliverables and service level agreements. As a federal contract, it is subject to the Federal Acquisition Regulation (FAR) and potentially oversight from the HHS Office of Inspector General (OIG) for issues related to fraud, waste, or abuse. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available.

Related Government Programs

Medicare Modernization Act
Health Insurance Portability and Accountability Act (HIPAA)
Federal Health Architecture
CMS IT Modernization Initiatives
DevSecOps Implementation Contracts
Cloud Infrastructure Services Contracts

Risk Flags

Potential for vendor lock-in
Reliance on contractor performance for critical modernization
Cybersecurity risks during system integration

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $20.2 million to NAVA PBC. CMS NEEDS A TEAM TO LEAD THE MEDICARE MODERNIZATION PROGRAM IN THE AREAS OF DEVSECOPS, INFRASTRUCTURE SUPPORT, AND TECHNICAL COORDINATION WITH SEVERAL APPLICATION DEVELOPMENT ORGANIZATION (ADO) TEAMS. MANAGEMENT OF VIRTUAL PRIVATE CLOUDS, NETWORKS,

Who is the contractor on this award?

The obligated recipient is NAVA PBC.

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 $20.2 million.

What is the period of performance?

Start: 2022-09-23. End: 2025-09-22.

What is NAVA PBC's track record with federal IT modernization contracts, particularly those of similar scale and complexity?

NAVA PBC, as a small business, has a developing track record in federal contracting. While specific details on past large-scale modernization projects are not immediately available in this summary, their award for the Medicare Modernization Program indicates a growing capability. Federal agencies often assess past performance through contractor performance evaluation reports (CPARS). A deeper dive into NAVA PBC's CPARS and other federal awards would provide a clearer picture of their experience in delivering complex IT solutions, managing DevSecOps pipelines, and supporting critical infrastructure for agencies beyond CMS. Their ability to secure this contract suggests they met the government's requirements for technical expertise and past performance, but a comprehensive review would be needed for a full assessment.

How does the $20.2 million contract value compare to similar federal IT modernization efforts managed by CMS or other agencies?

The $20.2 million value for a three-year contract focused on DevSecOps, infrastructure support, and technical coordination for a program as large as Medicare is within a reasonable range for federal IT modernization efforts. Large-scale modernization projects within agencies like CMS, the IRS, or the Department of Defense can easily run into hundreds of millions or even billions of dollars over their lifecycle. This specific award appears to be for a focused set of services supporting a broader modernization program. When compared to contracts for enterprise-wide system replacements or cloud migrations, $20.2 million might seem modest, but for specialized support functions, it represents a significant investment. Benchmarking requires comparing the scope, duration, and specific deliverables against similar contract actions.

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

Key risks include potential technical challenges in integrating new DevSecOps practices with legacy systems, ensuring robust cybersecurity throughout the modernization process, and managing the complexity of coordinating multiple application development organizations (ADOs). There's also a risk of vendor lock-in if specific proprietary tools or platforms are heavily utilized. Mitigation strategies likely involve strong contract oversight by CMS, clearly defined performance metrics and SLAs, phased implementation approaches, and potentially requirements for open standards or interoperability. The firm-fixed-price nature of the contract also incentivizes the contractor to manage risks effectively to maintain profitability. Regular security audits and penetration testing would be crucial.

How effective is the current Medicare modernization program, and how does this contract contribute to its overall success?

The effectiveness of the Medicare modernization program is a complex, ongoing assessment. Modernizing such a vast and critical system involves continuous effort to improve efficiency, security, and user experience for beneficiaries and providers. This contract directly supports that effort by providing essential technical expertise in DevSecOps and infrastructure management, which are foundational for building and maintaining modern, reliable IT systems. By ensuring the underlying infrastructure and development processes are robust and secure, this contract contributes to the program's ability to deliver services effectively, process claims accurately, and adapt to evolving healthcare needs and regulations. Its success is measured by the stability, security, and performance improvements it enables within the broader Medicare IT ecosystem.

What has been the historical spending trend for similar IT modernization support services at CMS over the past five years?

Historical spending trends for IT modernization support services at CMS have generally shown a consistent and often increasing investment. Agencies like CMS face continuous pressure to update aging systems, enhance cybersecurity, and improve data analytics capabilities to manage programs like Medicare and Medicaid effectively. Spending in areas like cloud migration, DevSecOps implementation, application modernization, and cybersecurity has been a significant focus across the federal government. While the specific dollar amount for this $20.2 million contract is a single data point, it aligns with a broader trend of substantial federal investment in modernizing health IT infrastructure. Analyzing aggregated spending data for IT services within CMS over the past five years would reveal the scale and growth of such investments.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 THOMAS CIR NW FL 9, WASHINGTON, DC, 20005

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

Financial Breakdown

Contract Ceiling: $20,201,632

Exercised Options: $20,201,632

Current Obligation: $20,201,632

Actual Outlays: $16,446,535

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $7,079,178

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75FCMC19A0010

IDV Type: BPA

Timeline