HHS awards $30.8M contract for hospital engagement services to Ascension Health

Contract Overview

Contract Amount: $30,838,778 ($30.8M)

Contractor: Ascension Health

Awarding Agency: Department of Health and Human Services

Start Date: 2011-12-09

End Date: 2014-12-08

Contract Duration: 1,095 days

Daily Burn Rate: $28.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 44

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: HOSPITAL ENGAGEMENT CONTRACTOR

Place of Performance

Location: SAINT LOUIS, ST. LOUIS County, MISSOURI, 63134, UNITED STATES OF AMERICA

State: Missouri Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $30.8 million to ASCENSION HEALTH for work described as: HOSPITAL ENGAGEMENT CONTRACTOR Key points: 1. Contract value represents a significant investment in administrative management and consulting services. 2. Full and open competition suggests a potentially competitive bidding process. 3. The contract duration of nearly three years indicates a substantial, ongoing need for these services. 4. Fixed-price contract type may offer cost certainty but could limit flexibility. 5. The award was made by the Centers for Medicare and Medicaid Services, highlighting a focus on healthcare system operations. 6. The North American Industry Classification System code 541611 points to a specialized consulting niche.

Value Assessment

Rating: fair

The contract value of $30.8 million for hospital engagement services over approximately three years appears to be within a reasonable range for specialized consulting. Benchmarking against similar contracts for administrative management and general management consulting services is challenging without more specific service details. However, the fixed-price nature suggests an attempt to control costs, though the ultimate value for money depends on the effectiveness of the engagement and the outcomes achieved. Further analysis would require comparing the specific deliverables and performance metrics against industry standards and the pricing of comparable engagements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 44 bids suggests a robust level of interest and a competitive environment. This broad competition is generally favorable for price discovery and can lead to more favorable pricing for the government. The high number of bidders implies that the market for these services is active and that the government had a good selection of potential providers.

Taxpayer Impact: A highly competitive bidding process typically results in better value for taxpayers by driving down prices and encouraging innovation among offerors.

Public Impact

The primary beneficiaries are likely the Centers for Medicare and Medicaid Services (CMS) and potentially healthcare providers engaged through this contract. Services delivered are expected to improve hospital engagement, likely focusing on administrative management and operational consulting. The geographic impact is primarily within Missouri, as indicated by the 'SN' field, suggesting a focus on state-level or regional hospital systems. Workforce implications could include the employment of consultants and administrative staff by the contractor, as well as potential impacts on hospital administrative roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if engagement objectives are not clearly defined and managed.
Risk of contractor lock-in if transition to a new provider is complex or costly.
Dependence on contractor expertise could reduce internal government capacity over time.

Positive Signals

Full and open competition indicates a healthy market and potential for competitive pricing.
Fixed-price contract type provides cost certainty for the government.
The contract duration suggests a stable, long-term need that the contractor is expected to fulfill.

Sector Analysis

This contract falls within the administrative management and general management consulting services sector, a broad category encompassing advisory services for businesses and organizations. The healthcare industry is a significant consumer of such services, particularly for operational efficiency, regulatory compliance, and strategic planning. The market size for management consulting in the US is substantial, with healthcare being a key segment. This contract with CMS fits within the broader trend of government agencies seeking external expertise to manage complex healthcare programs and improve system performance.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, small businesses were likely not the primary focus of this procurement. While the contractor, Ascension Health, is a large organization, there is no explicit information on subcontracting plans for small businesses. The impact on the small business ecosystem is likely minimal unless the prime contractor actively engages small businesses as subcontractors, which is not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within the Centers for Medicare and Medicaid Services. Accountability measures would be defined in the contract's statement of work and performance standards. Transparency is generally facilitated through contract award databases and public reporting, though specific performance details may be proprietary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Healthcare Consulting Services
Administrative Management Services
Centers for Medicare and Medicaid Services Contracts
Hospital Operations Improvement
Federal Management Consulting Awards

Risk Flags

Potential for performance issues if contractor capabilities do not fully align with complex requirements.
Risk of cost overruns if the fixed-price contract does not adequately account for unforeseen complexities.
Limited transparency into specific performance outcomes and value realization.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $30.8 million to ASCENSION HEALTH. HOSPITAL ENGAGEMENT CONTRACTOR

Who is the contractor on this award?

The obligated recipient is ASCENSION HEALTH.

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 $30.8 million.

What is the period of performance?

Start: 2011-12-09. End: 2014-12-08.

What specific hospital engagement activities were performed under this contract?

The provided data indicates the contract was for 'HOSPITAL ENGAGEMENT CONTRACTOR' under NAICS code 541611 (Administrative Management and General Management Consulting Services). While the specific activities are not detailed, typical engagements under such a contract could include strategic planning, operational efficiency improvements, process optimization, regulatory compliance assistance, data analysis for performance benchmarking, and facilitating communication or collaboration between CMS and healthcare providers. The contract likely aimed to improve the effectiveness of CMS programs by enhancing how hospitals interact with and comply with CMS requirements, potentially leading to better patient care outcomes and more efficient use of healthcare resources.

How does the $30.8 million award compare to other similar federal contracts for hospital engagement or management consulting?

Comparing the $30.8 million award requires context on the duration and scope. This contract spanned approximately three years (1095 days). For large-scale, multi-year federal consulting contracts, this value is substantial but not extraordinary, especially within the healthcare sector which often involves complex programs and significant administrative overhead. Similar contracts for broad management consulting or program support to agencies like HHS or CMS can range from millions to tens or even hundreds of millions of dollars depending on the breadth of services, number of locations supported, and criticality of the program. Without specific details on the deliverables and performance metrics, a precise benchmark is difficult, but the award suggests a significant, long-term need for specialized expertise.

What were the key performance indicators (KPIs) or success metrics for this contract?

The provided data does not specify the Key Performance Indicators (KPIs) or success metrics for this contract. Typically, for a 'Hospital Engagement Contractor' under administrative management consulting, KPIs would be tied to the objectives outlined in the Statement of Work (SOW). These could include metrics related to improved hospital compliance rates with specific regulations, enhanced efficiency in administrative processes, successful implementation of new CMS initiatives within hospitals, measurable improvements in data reporting accuracy or timeliness from hospitals, or increased participation rates in voluntary CMS programs. The effectiveness of the contract would be evaluated against these predefined metrics, which are usually detailed in the contract's performance work statement.

What is the track record of Ascension Health as a federal contractor, particularly with HHS or CMS?

Ascension Health is a major non-profit health system in the United States. While primarily known for providing healthcare services, large health organizations can also engage in consulting or administrative support roles, sometimes through affiliated entities or specific divisions. Information on Ascension Health's specific track record as a direct federal contractor for administrative management consulting services, particularly with HHS or CMS, is not detailed in the provided data snippet. Federal procurement databases would typically show a history of awards, performance ratings, and any past performance issues. A comprehensive assessment would require reviewing these databases to understand their experience, past performance evaluations, and any prior contracts of a similar nature.

What is the significance of the contract being 'FIRM FIXED PRICE'?

A 'FIRM FIXED PRICE' (FFP) contract type means the price is set and not subject to adjustment based on the contractor's cost experience in performing the work. This contract type offers the greatest degree of cost certainty for the government, as the total price is known upfront. It places the maximum risk on the contractor to manage its costs effectively and efficiently to achieve profitability. For the government, FFP contracts are generally preferred when the scope of work is well-defined and there is little uncertainty about the requirements. In this case, it suggests that CMS had a clear understanding of the hospital engagement services needed and expected Ascension Health to deliver them within the agreed-upon budget.

How has federal spending on hospital engagement or related consulting services evolved over time?

Federal spending on hospital engagement and related consulting services has generally trended upwards over the past two decades, driven by increasing complexity in healthcare regulations, the push for value-based care, and the need for operational efficiencies within healthcare systems. Agencies like HHS, particularly CMS, frequently contract for services to manage programs, implement policy changes, and improve healthcare delivery. Spending in this area is influenced by legislative mandates (e.g., Affordable Care Act), technological advancements, and public health priorities. While specific figures for 'hospital engagement' are hard to isolate, the broader market for healthcare consulting services procured by the federal government represents billions of dollars annually, reflecting the ongoing challenges and opportunities in managing the nation's healthcare infrastructure.

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) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: APP111513

Offers Received: 44

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4600 EDMUNDSON RD, SAINT LOUIS, MO, 63134

Business Categories: Category Business, Corporate Entity Tax Exempt, Hospital, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,838,778

Exercised Options: $30,838,778

Current Obligation: $30,838,778

Contract Characteristics

Cost or Pricing Data: NO

Timeline