HHS awards $70.1M for IHS Purchased Referred Care services to Health Care Service Corporation

Contract Overview

Contract Amount: $70,140,400 ($70.1M)

Contractor: Health Care Service Corporation, a Mutual Legal Reserve Company

Awarding Agency: Department of Health and Human Services

Start Date: 2022-07-08

End Date: 2026-07-31

Contract Duration: 1,484 days

Daily Burn Rate: $47.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: IHS PURCHASED REFERRED CARE (PRC) FISCAL INTERMEDIARY (FI) SERVICES

Place of Performance

Location: CHICAGO, COOK County, ILLINOIS, 60601

State: Illinois Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $70.1 million to HEALTH CARE SERVICE CORPORATION, A MUTUAL LEGAL RESERVE COMPANY for work described as: IHS PURCHASED REFERRED CARE (PRC) FISCAL INTERMEDIARY (FI) SERVICES Key points: 1. The contract focuses on essential healthcare services for American Indians and Alaska Natives. 2. Competition was full and open, suggesting a competitive bidding process. 3. The contract type is Time and Materials, which can pose cost control risks. 4. The sector is healthcare services, specifically for a government agency serving a specific population.

Value Assessment

Rating: fair

The contract is awarded on a Time and Materials basis, which can lead to cost overruns if not closely monitored. The award amount of $70.1M over approximately 4 years needs to be benchmarked against similar PRC contracts to assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This method generally promotes price discovery and competitive pricing.

Taxpayer Impact: The use of full and open competition is intended to ensure taxpayer funds are used efficiently by securing the best possible price for the services.

Public Impact

Ensures continued access to essential healthcare services for eligible American Indians and Alaska Natives. Supports the Indian Health Service's mission to raise the physical, mental, social, and spiritual health of American Indians and Alaska Natives to the highest possible level. The contract's success directly impacts the health and well-being of a vulnerable population.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to uncontrolled costs.
Potential for scope creep without strict oversight.
Dependence on a single contractor for critical services.

Positive Signals

Full and open competition utilized.
Contract supports a critical government mission.
Long-term award provides service stability.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on healthcare support. Government spending in this area is crucial for fulfilling public health mandates, particularly for underserved populations.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

Oversight will be critical, especially given the Time and Materials contract type. The Indian Health Service will need robust mechanisms to monitor performance, control costs, and ensure compliance with contract terms.

Related Government Programs

All Other Professional, Scientific, and Technical Services
Department of Health and Human Services Contracting
Indian Health Service Programs

Risk Flags

Time and Materials contract type.
Potential for cost overruns.
Dependence on contractor performance.
Need for strong government oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $70.1 million to HEALTH CARE SERVICE CORPORATION, A MUTUAL LEGAL RESERVE COMPANY. IHS PURCHASED REFERRED CARE (PRC) FISCAL INTERMEDIARY (FI) SERVICES

Who is the contractor on this award?

The obligated recipient is HEALTH CARE SERVICE CORPORATION, A MUTUAL LEGAL RESERVE COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $70.1 million.

What is the period of performance?

Start: 2022-07-08. End: 2026-07-31.

What is the historical cost performance of similar IHS PRC contracts, and how does this award compare?

Benchmarking this $70.1M contract against historical IHS PRC contracts awarded under similar conditions is essential. Analyzing cost trends, contractor performance, and any cost variances in previous agreements will provide insight into whether this award represents good value for taxpayer money. Without this comparative data, assessing the true financial efficiency of this contract is challenging.

What are the specific performance metrics and risk mitigation strategies in place for this Time and Materials contract?

Given the Time and Materials (T&M) contract type, understanding the defined performance metrics and the agency's risk mitigation strategies is paramount. This includes examining how IHS plans to monitor labor hours, material costs, and prevent scope creep. Robust oversight and clear deliverables are crucial to ensure the contractor operates efficiently and effectively within the allocated budget.

How effectively does this contract ensure the continuity and quality of care for the intended patient population?

The effectiveness of this contract hinges on its ability to ensure uninterrupted and high-quality healthcare services for American Indians and Alaska Natives. Evaluating the contractor's track record, the adequacy of service level agreements, and patient satisfaction data (if available) will provide insight into its success. The ultimate measure is the positive impact on the health outcomes of the beneficiaries.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 75H70422R00006

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 300 E RANDOLPH ST, CHICAGO, IL, 60601

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

Financial Breakdown

Contract Ceiling: $96,000,000

Exercised Options: $76,000,000

Current Obligation: $70,140,400

Actual Outlays: $52,414,946

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline