HUD awards $498,694 for hospital risk management, but competition was limited

Contract Overview

Contract Amount: $498,694 ($498.7K)

Contractor: Summit Consulting LLC

Awarding Agency: Department of Housing and Urban Development

Start Date: 2019-06-03

End Date: 2019-12-02

Contract Duration: 182 days

Daily Burn Rate: $2.7K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: RISK MANAGEMENT SERVICES FOR HOSPITALS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $498,693.81 to SUMMIT CONSULTING LLC for work described as: RISK MANAGEMENT SERVICES FOR HOSPITALS Key points: 1. Contract value appears reasonable for specialized risk management services. 2. Limited competition raises concerns about optimal pricing and value. 3. Short contract duration suggests a focused, tactical engagement. 4. Services align with administrative management consulting, a common government need. 5. Geographic focus on Washington D.C. may indicate specific regional requirements.

Value Assessment

Rating: fair

The contract value of approximately $498,694 for risk management services seems within a reasonable range for specialized consulting. However, without a competitive bidding process, it's difficult to benchmark against market rates or determine if this represents the best value for the government. The fixed-price nature of the award provides cost certainty, but the lack of competition limits the ability to assess pricing efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the simplified acquisition procedures, indicating a sole-source award. The absence of multiple bidders means there was no opportunity for price discovery through a competitive process. This approach can be justified if only one vendor possesses the unique qualifications or capabilities required, but it necessitates careful justification to ensure fair pricing and avoid potential overspending.

Taxpayer Impact: Taxpayers may not have received the most cost-effective solution due to the lack of competitive pressure to drive down prices.

Public Impact

The Department of Housing and Urban Development (HUD) is the primary beneficiary, receiving risk management expertise. Services likely focus on identifying and mitigating risks within HUD's hospital-related operations or investments. The geographic impact is concentrated in Washington D.C., suggesting services are delivered locally. The contract supports administrative functions within HUD, potentially impacting its operational efficiency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs than a competed contract.
Limited transparency into the selection process for a sole-source award.
Short contract duration might indicate a need for immediate, specific support rather than long-term strategy.

Positive Signals

Award to a single, potentially specialized vendor can ensure specific expertise is leveraged.
Fixed-price contract provides cost predictability for the agency.
Services are targeted towards risk management, a critical function for government agencies.

Sector Analysis

This contract falls within the administrative management and general management consulting services sector (NAICS 541611). This is a broad category encompassing a wide range of advisory services. The market for such services is competitive, but specific niche expertise, like hospital risk management, can lead to fewer qualified providers. Benchmarking spending in this area is challenging due to the diverse nature of consulting engagements.

Small Business Impact

The contract was not awarded to a small business, nor does it appear to have a small business set-aside. There is no explicit information regarding subcontracting plans for small businesses. This award does not directly contribute to the small business contracting goals of the agency.

Oversight & Accountability

As a purchase order, oversight would typically be managed by the contracting officer and program officials within HUD. The fixed-price nature provides some cost control. Transparency is limited due to the sole-source nature of the award. There is no specific mention of an Inspector General's involvement for this particular award, though their jurisdiction generally covers HUD programs.

Related Government Programs

Management and Financial Consulting, Acquisition and Technology Services
Professional, Scientific, and Technical Services
Government Management Consulting

Risk Flags

Limited Competition
Lack of Transparency in Award
Potential for Overpricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $498,693.81 to SUMMIT CONSULTING LLC. RISK MANAGEMENT SERVICES FOR HOSPITALS

Who is the contractor on this award?

The obligated recipient is SUMMIT CONSULTING LLC.

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $498,693.81.

What is the period of performance?

Start: 2019-06-03. End: 2019-12-02.

What specific risks was Summit Consulting LLC engaged to manage for HUD?

The provided data does not specify the exact nature of the 'RISK MANAGEMENT SERVICES FOR HOSPITALS.' However, given HUD's mission, these services could encompass financial risks associated with healthcare facility investments or loans, operational risks within HUD-managed healthcare properties, compliance risks related to healthcare regulations, or risks associated with public-private partnerships in the healthcare sector. Further details would require access to the contract statement of work or related documentation.

How does the $498,694 contract value compare to similar risk management contracts for hospitals?

Benchmarking this specific contract value is difficult without more context on the scope of services, duration, and the specific types of risks addressed. Risk management consulting for hospitals can vary significantly in price depending on whether it involves strategic planning, compliance audits, cybersecurity assessments, or operational efficiency reviews. A $498,694 award over six months (June 2019 - December 2019) suggests a substantial engagement, but without comparable sole-source or competed contracts for similar services within HUD or other agencies, a direct value comparison is not feasible from the provided data.

What are the potential risks associated with awarding a sole-source contract for risk management services?

The primary risk of a sole-source award is the potential for inflated pricing due to the lack of competitive pressure. Without multiple bids, the government may overpay for the services rendered. Additionally, there's a risk that the chosen contractor, while potentially possessing unique qualifications, might not be the most innovative or efficient provider available. Transparency can also be a concern, as the justification for the sole-source award needs to be robust to ensure fairness and prevent impropriety.

What is the track record of Summit Consulting LLC in providing risk management services to government agencies?

The provided data indicates that Summit Consulting LLC was awarded this contract. However, it does not offer details on their past performance, client satisfaction, or specific experience in hospital risk management for government entities. A comprehensive assessment of their track record would require searching federal procurement databases (like SAM.gov) for past awards, performance reviews, and any reported issues or successes with their previous government contracts.

What was the justification for awarding this contract on a sole-source basis?

The data states the contract was 'NOT COMPETED UNDER SAP' (Simplified Acquisition Procedures), which typically implies a sole-source or limited competition award. The specific justification for why this contract was not competed is not provided. Common reasons for sole-source awards include the existence of only one responsible source, urgent and compelling needs, or specific national security requirements. Without the official justification document, the rationale remains unknown.

How does this spending align with HUD's overall budget for consulting and professional services?

This contract represents a relatively small portion of HUD's overall budget. HUD, like many large federal agencies, procures a significant amount of consulting and professional services annually across various domains. To assess alignment, one would need to compare this $498,694 award against HUD's total spending on similar services during fiscal year 2019 or across multiple years. This single contract, while significant for its specific purpose, is unlikely to represent a major deviation from historical spending patterns for consulting services at HUD.

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: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 601 NEW JERSEY AVE STE 400, WASHINGTON, DC, 20001

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $498,694

Exercised Options: $498,694

Current Obligation: $498,694

Actual Outlays: $373,075

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline