HHS awarded $17.5M for quality improvement services, with limited competition

Contract Overview

Contract Amount: $17,544,633 ($17.5M)

Contractor: Healthcare Quality Strategies, Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2008-02-12

End Date: 2008-10-31

Contract Duration: 262 days

Daily Burn Rate: $67.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Healthcare

Official Description: QUALITY IMPROVEMENT ORGANIZATIO

Place of Performance

Location: EAST BRUNSWICK, MIDDLESEX County, NEW JERSEY, 08816

State: New Jersey Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $17.5 million to HEALTHCARE QUALITY STRATEGIES, INC for work described as: QUALITY IMPROVEMENT ORGANIZATIO Key points: 1. The contract's value of $17.5 million for a 9-month period suggests a significant investment in quality improvement initiatives. 2. Limited competition for this contract may have impacted price discovery and potentially led to higher costs. 3. The 'Cost Plus Award Fee' contract type introduces performance incentives but also carries inherent cost-reimbursement risks. 4. The contractor, HEALTHCARE QUALITY STRATEGIES, INC., has been awarded this definitive contract for administration of public health programs. 5. The contract's duration of 262 days is relatively short, suggesting a focused scope of work. 6. The geographic location of New Jersey for the contractor's site may indicate a regional focus for service delivery.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed service descriptions and comparable contract data. The 'Cost Plus Award Fee' structure means the final cost is dependent on performance, making a direct price comparison difficult. However, the $17.5 million award for a less than one-year period indicates a substantial investment per month, suggesting a need for thorough justification of the services rendered and their impact on healthcare quality.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'NOT AVAILABLE FOR COMPETITION,' indicating a limited or sole-source procurement. This suggests that either only one source was capable of providing the required services, or there were specific circumstances that precluded full and open competition. The lack of multiple bidders means that the government did not benefit from a competitive bidding process, which typically drives down prices and encourages innovation.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of robust competition. Without competing offers, there is a reduced incentive for the contractor to offer the most cost-effective solution.

Public Impact

Beneficiaries include healthcare providers and ultimately patients who stand to gain from improved quality of care. Services delivered likely focus on enhancing healthcare quality strategies and administering public health programs. The geographic impact is not explicitly defined but may be concentrated in or around New Jersey, where the contractor is located. Workforce implications could involve the employment of healthcare quality experts and administrative staff by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpricing and lack of innovative solutions.
The 'Cost Plus Award Fee' structure can lead to cost overruns if not managed carefully.
The short contract duration might indicate a pilot program or a specific, time-bound project, requiring careful planning for continuity.

Positive Signals

The contract targets a critical area of healthcare: quality improvement.
The award to a specific contractor suggests they possess specialized expertise in healthcare quality strategies.
The definitive contract award provides a clear framework for service delivery and payment.

Sector Analysis

This contract falls within the broader healthcare services sector, specifically focusing on quality improvement and public health program administration. The healthcare services market is substantial, with significant government spending aimed at enhancing patient outcomes and system efficiency. Comparable spending benchmarks would typically involve other contracts for quality improvement initiatives, health IT integration for quality reporting, or public health program management, often awarded by agencies like CMS or CDC.

Small Business Impact

There is no indication from the provided data that this contract involved small business set-asides or subcontracting opportunities. The nature of the award and the contractor's name do not suggest a primary focus on small business participation. Further investigation would be needed to determine if any small business subcontracting plans were mandated or voluntarily pursued.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services, specifically the Centers for Medicare and Medicaid Services (CMS). Accountability measures are embedded within the 'Cost Plus Award Fee' structure, linking payment to performance. Transparency would depend on the public availability of contract details and performance reports, which may be limited for competitively sensitive information.

Related Government Programs

Medicare Quality Improvement Programs
Medicaid Health Home Services
Public Health Infrastructure Grants
Healthcare Performance Measurement
Patient Safety Initiatives

Risk Flags

Limited competition may result in higher costs.
Cost-plus contract types carry inherent risk of cost overruns.
Award fee criteria require careful definition and objective assessment to ensure value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $17.5 million to HEALTHCARE QUALITY STRATEGIES, INC. QUALITY IMPROVEMENT ORGANIZATIO

Who is the contractor on this award?

The obligated recipient is HEALTHCARE QUALITY STRATEGIES, INC.

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 $17.5 million.

What is the period of performance?

Start: 2008-02-12. End: 2008-10-31.

What specific quality improvement initiatives were undertaken under this contract?

The provided data does not detail the specific quality improvement initiatives. However, given the contractor's name (HEALTHCARE QUALITY STRATEGIES, INC.) and the awarding agency (Centers for Medicare and Medicaid Services), the initiatives likely focused on enhancing the quality of care delivered to Medicare and Medicaid beneficiaries. This could include projects related to patient safety, chronic disease management, care coordination, reduction of hospital readmissions, or implementation of evidence-based practices. The 'Administration of Public Health Programs' also suggests a broader scope potentially involving population health strategies and program effectiveness evaluations.

How does the $17.5 million award compare to similar contracts for quality improvement services?

Direct comparison is difficult without knowing the exact scope, duration, and specific services rendered. However, $17.5 million for a contract running from February 2008 to October 2008 (approximately 9 months) represents a significant monthly expenditure. Contracts for quality improvement can vary widely, from smaller consulting engagements to large-scale program management. Given the 'Cost Plus Award Fee' structure and limited competition, this award suggests a substantial project requiring specialized expertise. Benchmarking would require identifying contracts with similar objectives, such as improving specific health outcomes or implementing new quality reporting systems within CMS or other federal health agencies.

What are the primary risks associated with a 'Cost Plus Award Fee' contract of this nature?

The primary risks with a 'Cost Plus Award Fee' (CPAF) contract are twofold. Firstly, the 'Cost Plus' component means the government reimburses the contractor for allowable costs, which can lead to cost overruns if not meticulously managed and audited. There's less incentive for the contractor to control costs compared to fixed-price contracts. Secondly, the 'Award Fee' component introduces subjectivity in determining the performance-based award. If the criteria for the award fee are not clearly defined, measurable, and objectively assessed, it can lead to disputes or dissatisfaction. For the government, the risk is paying higher costs than anticipated and potentially not achieving the desired level of performance if the award fee criteria are poorly structured.

What does 'NOT AVAILABLE FOR COMPETITION' imply for the procurement process and potential value?

'NOT AVAILABLE FOR COMPETITION' typically signifies a sole-source or limited competition procurement. This can occur for several reasons, such as the contractor possessing unique capabilities, proprietary technology, or being the only source capable of meeting urgent requirements. While it ensures a specific capability is secured, it significantly reduces the government's leverage in price negotiation. Without competing bids, the government cannot be assured it received the best possible price or that the chosen contractor was the most efficient provider. This can lead to higher costs for taxpayers compared to a fully competed contract.

What is the historical spending pattern for HEALTHCARE QUALITY STRATEGIES, INC. with the federal government?

The provided data only reflects a single definitive contract awarded in 2008. To understand the historical spending pattern for HEALTHCARE QUALITY STRATEGIES, INC., a comprehensive search of federal procurement databases (like FPDS or USASpending.gov) would be necessary. This would reveal the total value of contracts awarded to this entity over time, the agencies involved, the types of services procured, and the competition levels for those contracts. Without this broader data, it's impossible to establish a historical spending pattern or assess the contractor's track record.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 557 CRANBERRY RD, STE 21, EAST BRUNSWICK, NJ, 08816

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $17,544,633

Exercised Options: $17,544,633

Current Obligation: $17,544,633

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline