HHS awards $19M for PPRS O&M to Digital Management LLC, highlighting IT services for health programs

Contract Overview

Contract Amount: $18,999,482 ($19.0M)

Contractor: Digital Management LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-08-05

End Date: 2026-08-07

Contract Duration: 367 days

Daily Burn Rate: $51.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OIT- SERVICES40 C 6645. PROGRAM PERFORMANCE REPORTING SYSTEMS (PPRS) OPERATIONS & MAINTENANCE CALL ORDER.

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $19.0 million to DIGITAL MANAGEMENT LLC for work described as: OIT- SERVICES40 C 6645. PROGRAM PERFORMANCE REPORTING SYSTEMS (PPRS) OPERATIONS & MAINTENANCE CALL ORDER. Key points: 1. Contract focuses on essential IT operations and maintenance for critical health reporting systems. 2. Digital Management LLC, a significant IT service provider, holds this contract. 3. The contract duration is over a year, indicating ongoing support needs. 4. Performance reporting systems are crucial for program oversight and effectiveness. 5. The award falls under IT services, a broad and vital sector for federal operations. 6. Fixed-price contract type suggests defined scope and cost predictability.

Value Assessment

Rating: good

The contract value of approximately $19 million over its term appears reasonable for IT operations and maintenance services supporting a program performance reporting system. Benchmarking against similar IT support contracts for federal agencies of comparable size and complexity would provide a more precise value-for-money assessment. However, the firm fixed-price nature suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the competitive process is expected to drive pricing towards market rates and encourage innovation. A robust competition typically leads to better value for the government.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by leveraging market forces to secure the best possible price and service for essential IT support.

Public Impact

Beneficiaries include the Health Resources and Services Administration (HRSA) and its program beneficiaries who rely on accurate data reporting. Services delivered include operations and maintenance for the Program Performance Reporting Systems (PPRS). The geographic impact is primarily within Virginia, where the contractor is located, but the system's reach is national. Workforce implications include IT professionals supporting the PPRS, potentially involving system administrators, developers, and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if system requirements evolve significantly beyond the initial PPRS mandate.
Dependence on a single contractor for critical system uptime and performance.
Risk of knowledge transfer challenges if key personnel depart during the contract term.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive pricing environment.
Contract duration of over a year allows for stable support and performance.

Sector Analysis

The IT services sector is a cornerstone of federal operations, with significant spending allocated to software development, maintenance, and IT support. Contracts like this, focused on maintaining critical reporting systems, are common across various agencies. The market for IT operations and maintenance is competitive, with numerous firms offering specialized services. Benchmarks for similar IT support contracts often range widely based on system complexity and scope, but this award appears within a typical range for dedicated system support.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a small business set-aside. There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically be managed by the Health Resources and Services Administration (HRSA) contracting officers and program managers. Performance metrics and reporting requirements outlined in the contract would be used to monitor contractor performance. Transparency is generally maintained through contract award databases, though specific performance details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Health IT Services
Federal IT Modernization
Program Management Support
IT Operations and Maintenance
Data Reporting Systems

Risk Flags

Potential for vendor lock-in if competition diminishes in future procurements.
Reliance on contractor for critical system uptime and data integrity.
Cybersecurity risks inherent in maintaining government IT systems.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $19.0 million to DIGITAL MANAGEMENT LLC. OIT- SERVICES40 C 6645. PROGRAM PERFORMANCE REPORTING SYSTEMS (PPRS) OPERATIONS & MAINTENANCE CALL ORDER.

Who is the contractor on this award?

The obligated recipient is DIGITAL MANAGEMENT LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Health Resources and Services Administration).

What is the total obligated amount?

The obligated amount is $19.0 million.

What is the period of performance?

Start: 2025-08-05. End: 2026-08-07.

What is the track record of Digital Management LLC in delivering IT operations and maintenance services to federal agencies, particularly for health-related systems?

Digital Management LLC (DMI) has a substantial history of providing IT services to various federal agencies, including the Department of Health and Human Services (HHS). Their portfolio often includes system modernization, cloud migration, cybersecurity, and IT operations and maintenance. For health-related systems, DMI has supported agencies like the Centers for Medicare & Medicaid Services (CMS) and other components within HHS. Their experience with program performance reporting systems specifically would be a key indicator of their suitability for this contract. A review of past performance evaluations and contract awards would reveal their success in meeting performance metrics, managing budgets, and delivering on time for similar complex IT systems within the federal health sector.

How does the awarded amount of approximately $19 million compare to the estimated value or budget for similar PPRS operations and maintenance contracts?

Without specific details on the scope and complexity of the PPRS, a direct comparison is challenging. However, federal IT operations and maintenance contracts can vary significantly. For a system supporting national health programs, $19 million over approximately 1.5 years (from August 2025 to August 2026) suggests a moderate to significant investment. Comparable contracts for large-scale federal IT systems often range from tens to hundreds of millions of dollars annually, depending on the criticality, user base, and technological sophistication. The firm fixed-price nature implies a defined scope, and if the scope is well-managed, this value could represent good pricing. Further analysis would require benchmarking against contracts for similar reporting systems within HHS or other health-focused agencies.

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

Key risks include potential technical obsolescence of the PPRS, cybersecurity vulnerabilities, contractor performance issues (e.g., system downtime, slow response times), and potential cost overruns if the scope expands beyond the firm fixed-price agreement. Mitigation strategies likely involve robust Service Level Agreements (SLAs) with defined penalties for non-performance, regular security audits and patching, strong government oversight with performance monitoring, and contingency planning for system upgrades or replacements. The full and open competition also mitigates some risk by ensuring a competitive market for services, potentially leading to better contractor responsiveness.

How effective is the Program Performance Reporting Systems (PPRS) in supporting HRSA's mission, and how does this contract contribute to that effectiveness?

The PPRS is crucial for HRSA to monitor the performance of its various health programs, ensuring they meet objectives, are delivered efficiently, and serve their intended beneficiaries. Effective operation and maintenance of this system are paramount for accurate data collection, analysis, and reporting to Congress and the public. This contract directly contributes to effectiveness by ensuring the system remains operational, secure, and up-to-date. Without reliable IT support, the PPRS could suffer from data integrity issues, system outages, or security breaches, all of which would undermine HRSA's ability to manage its programs and demonstrate accountability, thereby hindering its mission.

What are the historical spending patterns for PPRS operations and maintenance, and how does this award fit into that trend?

Historical spending data for PPRS O&M would provide context for this $19 million award. If previous years saw similar or higher spending for comparable services, it suggests a consistent need and potentially stable pricing. Conversely, a significant increase or decrease might warrant further investigation into changes in system scope, vendor performance, or market conditions. Without access to historical data specific to PPRS O&M, it's difficult to definitively place this award within a trend. However, federal IT spending, particularly on maintaining critical infrastructure, generally remains substantial year over year, making this award appear consistent with ongoing operational needs.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 75R60225Q00073

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1600 INTERNATIONAL DR STE 500, MC LEAN, VA, 22102

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,186,672

Exercised Options: $18,999,482

Current Obligation: $18,999,482

Actual Outlays: $10,259,720

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 75R60225A00015

IDV Type: BPA

Timeline