Medicare DME MAC Jurisdiction A Contract Awarded to NHIC Corp for $105M
Contract Overview
Contract Amount: $105,226,239 ($105.2M)
Contractor: Nhic, Corp
Awarding Agency: Department of Health and Human Services
Start Date: 2011-04-01
End Date: 2016-08-31
Contract Duration: 1,979 days
Daily Burn Rate: $53.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: COST PLUS AWARD FEE
Sector: Healthcare
Official Description: DURABLE MEDICAL EQUIPMENT MEDICARE ADMINISTRATIVE CONTRACT JURISDICTION A
Place of Performance
Location: HINGHAM, PLYMOUTH County, MASSACHUSETTS, 02043
Plain-Language Summary
Department of Health and Human Services obligated $105.2 million to NHIC, CORP for work described as: DURABLE MEDICAL EQUIPMENT MEDICARE ADMINISTRATIVE CONTRACT JURISDICTION A Key points: 1. Contract value of $105.2M over 5 years. 2. Awarded under full and open competition. 3. Potential risk in cost-plus award fee structure. 4. Sector: Healthcare administration and insurance.
Value Assessment
Rating: fair
The contract's Cost Plus Award Fee (CPAF) structure can incentivize performance but may also lead to higher costs if not managed carefully. Benchmarking against similar administrative contracts is difficult without detailed performance data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, suggesting a robust price discovery process. However, the CPAF structure requires careful monitoring to ensure cost-effectiveness.
Taxpayer Impact: Taxpayer funds are used for Medicare administration. The efficiency of this contract directly impacts the cost of healthcare services for beneficiaries.
Public Impact
Impacts Medicare beneficiaries' access to durable medical equipment. Ensures proper administration and claims processing for a critical healthcare service. Affects the operational efficiency of the Centers for Medicare and Medicaid Services (CMS).
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee structure
- Contract duration of 5 years
Positive Signals
- Full and open competition
- Clear contract award
Sector Analysis
This contract falls within the healthcare sector, specifically Medicare administrative services. Spending benchmarks for similar administrative contracts are highly variable based on scope and complexity.
Small Business Impact
The data does not indicate any specific provisions or awards to small businesses under this contract.
Oversight & Accountability
CMS is responsible for oversight. The CPAF structure necessitates diligent performance monitoring and auditing to ensure value for money and prevent cost overruns.
Related Government Programs
- Direct Health and Medical Insurance Carriers
- Department of Health and Human Services Contracting
- Centers for Medicare and Medicaid Services Programs
Risk Flags
- Potential for cost overruns due to CPAF structure
- Long contract duration may reduce flexibility
- Complexity of Medicare administration requires robust oversight
Tags
direct-health-and-medical-insurance-carr, department-of-health-and-human-services, ma, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $105.2 million to NHIC, CORP. DURABLE MEDICAL EQUIPMENT MEDICARE ADMINISTRATIVE CONTRACT JURISDICTION A
Who is the contractor on this award?
The obligated recipient is NHIC, CORP.
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 $105.2 million.
What is the period of performance?
Start: 2011-04-01. End: 2016-08-31.
How effectively did the CPAF structure incentivize NHIC, Corp to control costs while maintaining service quality?
The effectiveness of the CPAF structure hinges on the specific award fee criteria and CMS's oversight. Without detailed performance metrics and award fee payouts, it's difficult to definitively assess cost control effectiveness. A well-defined criteria set should reward efficiency and quality, but poorly managed CPAF can lead to inflated costs if the government's evaluation process is not rigorous.
What were the primary risks associated with the full and open competition for this contract?
While full and open competition generally promotes a competitive environment, risks can include the complexity of evaluating multiple proposals, potential for protests, and ensuring that the chosen contractor possesses the specialized expertise required for Medicare administration. The government must ensure the evaluation criteria accurately reflect the needs of the program and that the winning bid represents the best value.
How did this contract contribute to the overall efficiency and effectiveness of Medicare's durable medical equipment program?
This contract's effectiveness is measured by its ability to ensure timely and accurate processing of DME claims, manage provider networks, and maintain program integrity. Success would be reflected in beneficiary satisfaction, reduced fraud and abuse, and efficient operational costs for CMS. The CPAF structure suggests an intent to link contractor performance directly to these outcomes.
Industry Classification
NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers
Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: RFPCMS20100004
Offers Received: 5
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: DXC Technology Company
Address: 402 OTTERSON DR, CHICO, CA, 95928
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $105,226,239
Exercised Options: $105,226,239
Current Obligation: $105,226,239
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2011-04-01
Current End Date: 2016-08-31
Potential End Date: 2016-08-31 00:00:00
Last Modified: 2023-09-28
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