HHS awards $18.9M for Public Health Programs to Michigan Peer Review Organization, a sole-source contract

Contract Overview

Contract Amount: $18,896,435 ($18.9M)

Contractor: Michigan Peer Review Organization

Awarding Agency: Department of Health and Human Services

Start Date: 2008-02-07

End Date: 2009-02-17

Contract Duration: 376 days

Daily Burn Rate: $50.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Healthcare

Official Description: 8TH SOW QIO MODIFICATION #8

Place of Performance

Location: FARMINGTON HILLS, OAKLAND County, MICHIGAN, 48335

State: Michigan Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $18.9 million to MICHIGAN PEER REVIEW ORGANIZATION for work described as: 8TH SOW QIO MODIFICATION #8 Key points: 1. The contract value of $18.9M is for a 1-year period. 2. This is a sole-source award, indicating limited competition. 3. The contract type is Cost Plus Award Fee, which can incentivize performance but may lead to higher costs. 4. The sector is Healthcare, specifically public health program administration.

Value Assessment

Rating: fair

The contract's Cost Plus Award Fee structure allows for potential cost overruns if performance incentives are not carefully managed. Benchmarking against similar public health program administration contracts is difficult without more detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, which limits price discovery and potentially increases costs for taxpayers. The rationale for the sole-source award is not provided, raising questions about whether alternatives were considered.

Taxpayer Impact: The lack of competition for this $18.9M contract may result in higher costs for taxpayers than if it had been competitively bid.

Public Impact

Taxpayers may be paying more due to the absence of a competitive bidding process. The effectiveness of public health programs administered under this contract could be impacted by the contract's structure. Transparency in government spending is reduced when contracts are not competed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Cost Plus Award Fee contract type
Lack of transparency in justification for sole-source

Positive Signals

Contract awarded to an established organization (MICHIGAN PEER REVIEW ORGANIZATION)
Clear period of performance

Sector Analysis

This contract falls within the Healthcare sector, specifically focusing on the administration of public health programs. Spending in this area is critical for national well-being, but efficient procurement is essential.

Small Business Impact

There is no indication that small businesses were involved in this sole-source award, suggesting a missed opportunity for small business participation.

Oversight & Accountability

The sole-source nature of this award warrants further oversight to ensure the justification was sound and that the pricing is reasonable. Accountability for performance under the Cost Plus Award Fee structure should be rigorously monitored.

Related Government Programs

Administration of Public Health Programs
Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Lack of competition
Potential for cost overruns
Limited transparency
No indication of small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $18.9 million to MICHIGAN PEER REVIEW ORGANIZATION. 8TH SOW QIO MODIFICATION #8

Who is the contractor on this award?

The obligated recipient is MICHIGAN PEER REVIEW ORGANIZATION.

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 $18.9 million.

What is the period of performance?

Start: 2008-02-07. End: 2009-02-17.

What was the specific justification for awarding this contract on a sole-source basis, and were alternative solutions considered?

The provided data does not include the justification for the sole-source award. Typically, sole-source contracts are used when only one responsible source can provide the required supplies or services. Without this information, it's impossible to assess if this was the most appropriate procurement method or if it led to a fair price.

How does the Cost Plus Award Fee structure impact the overall cost-effectiveness and risk of this contract compared to fixed-price alternatives?

Cost Plus Award Fee contracts reimburse the contractor for allowable costs plus an incentive fee based on performance. While this can encourage high performance, it carries a risk of cost overruns if performance targets are not well-defined or if costs escalate unexpectedly. Benchmarking against similar contracts is crucial to assess cost-effectiveness.

What metrics are in place to measure the effectiveness of the public health programs administered under this contract, and how is the award fee tied to these metrics?

The data does not specify the performance metrics or how the award fee is calculated. Effective oversight would require clear, measurable objectives for the public health programs and a transparent system for evaluating performance against these objectives to determine the award fee.

Industry Classification

NAICS: Public Administration › Administration of Human Resource Programs › Administration of Public Health Programs

Product/Service Code: MEDICAL SERVICES › DEPENDENT MEDICARE SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 2670 HAGGERTY RD, NOVI, MI, 48374

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $18,896,435

Exercised Options: $18,896,435

Current Obligation: $18,896,435

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline