HHS awards $58.8M for IT services to NTT DATA FEDHEALTH, Inc. over 5 years

Contract Overview

Contract Amount: $58,842,166 ($58.8M)

Contractor: NTT Data Fedhealth, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2019-01-30

End Date: 2024-05-15

Contract Duration: 1,932 days

Daily Burn Rate: $30.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IN ACCORDANCE WITH FAR PART 8.405 ORDERING PROCEDURES FOR FEDERAL SUPPLY SCHEDULES THE PURPOSE OF THIS AWARD IS TO PARTIALLY FUND FOR PROFESSIONAL SERVICES LABOR AND OTHER DIRECT COST FOR BUSINESS APPLICATION SERVICES BAS FOR THE FOLLOWING PROJECTS NEES DDRMS FFS FOR OM ISDP NED FFS FOR HATS FFS FOR FOIA 2 ADD ADDITIONAL FUNDING IN THE AMOUNT OF $2458919.16 FOR PROFESSIONAL SERVICES WITH THE PERIOD OF PERFORMANCE 02/01/2019 THRU 07/15/2019 WITH ADDITIONAL OPTION PERIODS.

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $58.8 million to NTT DATA FEDHEALTH, INC. for work described as: IN ACCORDANCE WITH FAR PART 8.405 ORDERING PROCEDURES FOR FEDERAL SUPPLY SCHEDULES THE PURPOSE OF THIS AWARD IS TO PARTIALLY FUND FOR PROFESSIONAL SERVICES LABOR AND OTHER DIRECT COST FOR BUSINESS APPLICATION SERVICES BAS FOR THE FOLLOWING PROJECTS NEES DDRMS FFS FOR OM ISDP NED … Key points: 1. Contract awarded via Federal Supply Schedule (FSS) ordering procedures, indicating a pre-competed framework. 2. The contract covers a broad range of IT services including business application services for multiple NIH projects. 3. A significant portion of the award value is allocated to professional services and direct costs. 4. The contract has a long performance period, extending over five years, suggesting a need for sustained support. 5. The fixed-price contract type aims to provide cost certainty for the government. 6. The award is a delivery order against an existing FSS contract.

Value Assessment

Rating: good

The total award value of $58.8 million over approximately five years suggests a substantial investment in IT services. Benchmarking this against similar large-scale IT service contracts within the federal government is challenging without more granular data on the specific services provided. However, the use of FSS ordering procedures implies that pricing was likely pre-negotiated and competitive at the schedule level. The firm-fixed-price nature of the contract helps manage cost overruns, but the overall value should be assessed against the delivered outcomes and the criticality of the NIH projects supported.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, likely utilizing Federal Supply Schedule (FSS) ordering procedures. While the specific number of bidders for this particular delivery order is not detailed, the FSS mechanism itself is designed to foster competition by allowing multiple vendors to offer their services. This approach generally leads to better price discovery and a wider selection of qualified contractors compared to sole-source awards.

Taxpayer Impact: Full and open competition, especially through established schedules like FSS, is beneficial for taxpayers as it drives competitive pricing and ensures the government accesses a broad market of IT service providers, potentially leading to cost savings and better service quality.

Public Impact

The National Institutes of Health (NIH) benefits from enhanced IT infrastructure and application support, crucial for its research and public health missions. Services delivered include business application support for various NIH projects such as NEES, DDRMS, FFS, ISDP, and FOIA. The geographic impact is primarily within Maryland, where NIH facilities are concentrated. Workforce implications include the employment of IT professionals and support staff by NTT DATA FEDHEALTH, Inc. to fulfill contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The long performance period could lead to vendor lock-in if not managed carefully.
The broad scope of 'business application services' might obscure specific performance metrics for individual projects.
Reliance on FSS, while competitive at the schedule level, may not always yield the absolute lowest price for highly specialized services.

Positive Signals

Awarded under full and open competition, ensuring a competitive marketplace.
Firm-fixed-price contract type provides cost predictability.
NTT DATA FEDHEALTH, Inc. is an established government contractor with experience in health IT.
The contract supports critical NIH IT infrastructure and application needs.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on IT professional services and application support. The federal IT services market is vast, with agencies consistently investing in maintaining and upgrading their systems. Contracts like this are common as departments rely on specialized vendors to manage complex software, databases, and business applications essential for their operations. Benchmarks for similar IT services contracts within the federal government vary widely based on scope, duration, and specific technologies, but this award represents a significant investment in sustaining critical NIH functions.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications mandated by a small business set-aside. However, as a large prime contractor, NTT DATA FEDHEALTH, Inc. may have its own internal policies or contractual obligations regarding subcontracting with small businesses to meet broader federal goals, though this is not explicitly detailed in the provided information.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the National Institutes of Health (NIH). As a delivery order against a Federal Supply Schedule (FSS) contract, the underlying FSS contract itself undergoes a level of vetting. Transparency is facilitated through contract award databases like FPDS. Accountability is driven by the firm-fixed-price structure and performance requirements outlined in the delivery order. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Federal Supply Schedules (FSS)
IT Professional Services
Business Application Services
Health Information Technology
NIH IT Modernization Efforts

Risk Flags

Long contract duration may increase risk of technological obsolescence.
Broad service description could lead to ambiguity in performance expectations.
Potential for vendor lock-in over the extended period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $58.8 million to NTT DATA FEDHEALTH, INC.. IN ACCORDANCE WITH FAR PART 8.405 ORDERING PROCEDURES FOR FEDERAL SUPPLY SCHEDULES THE PURPOSE OF THIS AWARD IS TO PARTIALLY FUND FOR PROFESSIONAL SERVICES LABOR AND OTHER DIRECT COST FOR BUSINESS APPLICATION SERVICES BAS FOR THE FOLLOWING PROJECTS NEES DDRMS FFS FOR OM ISDP NED FFS FOR HATS FFS FOR FOIA 2 ADD ADDITIONAL FUNDING IN THE AMOUNT OF $2458919.16 FOR PROFESSIONAL SERVICES WITH THE PERIOD OF PERFORMANCE 02/01/2019 THRU 07/15/2019 WITH ADDITIONAL OPTION PERIODS.

Who is the contractor on this award?

The obligated recipient is NTT DATA FEDHEALTH, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $58.8 million.

What is the period of performance?

Start: 2019-01-30. End: 2024-05-15.

What is the track record of NTT DATA FEDHEALTH, Inc. with the federal government, particularly with the NIH?

NTT DATA FEDHEALTH, Inc. has a significant track record of performing IT and healthcare-related services for various federal agencies, including the Department of Health and Human Services (HHS) and its components like the National Institutes of Health (NIH). Their experience often encompasses a wide range of IT support, including application development, maintenance, data management, and cybersecurity. Awards to NTT DATA FEDHEALTH, Inc. are frequently found within contract databases, reflecting their established presence as a government contractor. Their performance history with NIH would be detailed in past performance evaluations used during the bidding process for contracts like this one, assessing their ability to meet technical requirements, timelines, and budget constraints on previous engagements.

How does the value of this contract compare to other similar IT services contracts awarded by the NIH?

The $58.8 million award value over approximately five years positions this contract as a substantial investment in IT services for the NIH. To compare it accurately, one would need to analyze other large IT services contracts awarded by NIH for similar scopes of work, such as application development, maintenance, and IT infrastructure support. Contracts for enterprise-wide systems, large-scale data management, or significant cybersecurity initiatives often reach or exceed this value. Smaller, more focused IT support tasks or individual project-specific contracts would naturally be valued lower. The comparison should also consider the contract type (firm-fixed-price), the specific services rendered, and the duration to ensure a like-for-like assessment.

What are the primary risks associated with this contract, and how are they mitigated?

Primary risks include potential scope creep if the 'business application services' are not clearly defined, leading to cost overruns despite the fixed-price nature. Another risk is vendor performance; if NTT DATA FEDHEALTH, Inc. fails to deliver quality services, it could impact critical NIH operations. Technological obsolescence is also a risk, given the five-year duration, requiring continuous adaptation. Mitigation strategies include robust contract management by NIH officials, clear performance work statements, regular progress reviews, and potentially incorporating service level agreements (SLAs) with defined metrics. The firm-fixed-price structure itself mitigates financial risk for the government, shifting cost overrun responsibility to the contractor.

How effective is the Federal Supply Schedule (FSS) mechanism in ensuring value for money for IT services?

The FSS mechanism is designed to provide value for money by pre-competing a wide range of IT products and services, establishing ceiling prices, and streamlining the ordering process. Agencies benefit from reduced acquisition lead times and access to a broad base of vendors. For IT services, FSS allows agencies to quickly obtain necessary support through a competitive ordering process against established schedules. While FSS prices are generally considered fair and reasonable, they may not always represent the absolute lowest price achievable through a full and open competition tailored to a specific, unique requirement. However, the administrative savings and speed often compensate for potential minor price differences, making it a valuable tool for routine and well-defined IT needs.

What are the historical spending patterns for IT services at the NIH, and how does this contract fit in?

The NIH consistently allocates significant portions of its budget to IT services, reflecting the data-intensive nature of biomedical research and public health initiatives. Historical spending patterns show a continuous need for application development, system maintenance, data storage, cybersecurity, and user support. This $58.8 million contract fits within these patterns as a substantial, multi-year investment to ensure the continuity and enhancement of critical business applications and IT infrastructure supporting various NIH projects. It represents a typical large-scale IT services award necessary for maintaining the operational capabilities of a major research institution.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related 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: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1660 INTERNATIONAL DR, FL 1, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $58,842,166

Exercised Options: $58,842,166

Current Obligation: $58,842,166

Actual Outlays: $32,104,351

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F0526V

IDV Type: FSS

Timeline