HHS awarded $32.3M for IT services, with strong competition and a fixed-price contract

Contract Overview

Contract Amount: $32,339,567 ($32.3M)

Contractor: Information Innovators, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2012-08-02

End Date: 2016-11-29

Contract Duration: 1,580 days

Daily Burn Rate: $20.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SECURITY OVERSIGHT

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $32.3 million to INFORMATION INNOVATORS, LLC for work described as: SECURITY OVERSIGHT Key points: 1. The contract utilized full and open competition, suggesting a competitive pricing environment. 2. A firm fixed-price structure helps mitigate cost overrun risks for the government. 3. The contract duration of 1580 days indicates a significant, long-term need for these services. 4. The award was made by CMS, a major health services agency within HHS. 5. The services fall under computer systems design, a critical area for government IT infrastructure. 6. The contractor, Information Innovators, LLC, has experience in this domain.

Value Assessment

Rating: good

Benchmarking the exact value of $32.3 million requires detailed comparison to similar IT service contracts awarded by CMS and HHS during the 2012-2016 period. However, the firm fixed-price contract type is generally favorable for value, as it caps the government's financial exposure. The absence of reported cost overruns or significant modifications would further indicate good value. Without specific per-unit cost data or a detailed breakdown of services rendered, a precise value-for-money assessment is challenging, but the competitive nature of the award is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' While this indicates an initial intent for broad competition, the 'exclusion of sources' clause suggests that certain potential bidders may have been excluded prior to the main solicitation. The presence of two bidders indicates some level of competition, but the exact number of interested parties and the reasons for exclusion would provide a clearer picture of the competitive landscape. A more robust competition with a higher number of bidders typically leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The competitive award process, even with potential exclusions, aims to secure the best possible pricing for taxpayers. A firm fixed-price contract further protects taxpayer funds by establishing a ceiling on costs.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) and potentially healthcare providers and beneficiaries who rely on the IT systems supported by these services. Services delivered include computer systems design, crucial for maintaining and improving the operational IT infrastructure of CMS. The geographic impact is primarily within the operational scope of CMS, likely supporting national healthcare programs. Workforce implications include the employment of IT professionals by the contractor, Information Innovators, LLC, and potentially internal government IT staff overseeing the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to 'exclusion of sources' clause, which warrants further investigation into the justification for exclusions.
Contract duration of nearly four years could lead to vendor lock-in if not managed carefully.
Reliance on a single contractor for critical IT services poses a risk if the contractor underperforms or faces financial instability.

Positive Signals

Firm fixed-price contract type provides cost certainty and reduces the risk of budget overruns.
Awarded under full and open competition (with noted exclusions), suggesting an effort to leverage market capabilities.
The contract supports a critical function within CMS, indicating alignment with agency mission objectives.

Sector Analysis

The contract falls within the Information Technology (IT) sector, specifically Computer Systems Design Services. This is a broad and essential category for government operations, encompassing the design, development, and integration of IT systems. The market for these services is highly competitive, with numerous firms offering specialized expertise. The $32.3 million award is a significant but not extraordinary sum for a multi-year IT services contract within a large federal agency like HHS. Comparable spending benchmarks would involve analyzing other large IT service contracts awarded by agencies like HHS, DOD, or GSA for similar system design and support functions.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific benefits for small businesses stemming from a set-aside provision. The primary contractor, Information Innovators, LLC, is likely a mid-to-large-sized business given the contract value. The impact on the small business ecosystem would be indirect, potentially through competition with larger firms or through opportunities if the prime contractor engages in subcontracting, though this is not specified.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officer and the relevant program officials within the Centers for Medicare and Medicaid Services (CMS). As a contract supporting federal IT services, it would likely be subject to standard federal procurement regulations and oversight mechanisms, including performance monitoring and compliance checks. Transparency is generally facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected or identified.

Related Government Programs

HHS IT Modernization Initiatives
CMS Health IT Services
Federal Civilian IT Procurement
Information Technology Professional Services
Government IT Infrastructure Support

Risk Flags

Potential for limited competition due to 'exclusion of sources'.
Long contract duration may lead to technology obsolescence or vendor lock-in.
Need for robust performance monitoring to ensure value delivery over the contract term.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $32.3 million to INFORMATION INNOVATORS, LLC. SECURITY OVERSIGHT

Who is the contractor on this award?

The obligated recipient is INFORMATION INNOVATORS, LLC.

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 $32.3 million.

What is the period of performance?

Start: 2012-08-02. End: 2016-11-29.

What was the specific nature of the 'exclusion of sources' in this full and open competition?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' indicates that while the solicitation was intended to be open, certain potential sources were excluded from consideration prior to the solicitation or award. The specific reasons for exclusion are not detailed in the provided data but could include factors such as prior performance issues, failure to meet minimum qualifications, or specific agency requirements that narrowed the field. Understanding these exclusions is crucial for a complete assessment of the competition's breadth and its potential impact on pricing and innovation. Without further documentation, it's difficult to ascertain if these exclusions were justified and served the government's best interest or if they unduly limited competition.

How does the firm fixed-price (FFP) contract type compare to other pricing arrangements for similar IT services?

A Firm Fixed-Price (FFP) contract, like the one awarded here, is generally considered advantageous for the government when the scope of work is well-defined and risks are understood. It shifts most of the cost risk to the contractor, providing budget certainty for the agency. Compared to Cost-Plus contracts, FFP offers less flexibility for scope changes but greater predictability in spending. For IT services, where requirements can sometimes evolve, FFP can be challenging if not managed with clear change control processes. However, it incentivizes contractor efficiency. Other common types include Time and Materials (T&M), which offers flexibility but higher cost risk, and Cost-Plus Fixed-Fee (CPFF), which balances risk but requires more oversight.

What is the track record of Information Innovators, LLC in delivering similar IT services to the federal government?

Information Innovators, LLC, was awarded this $32.3 million contract for Computer Systems Design Services by CMS. To assess their track record, one would need to examine their past performance on federal contracts, particularly those with HHS and CMS. This includes reviewing past performance evaluations (if available), contract modifications, and any history of disputes or terminations. A positive track record would involve successful delivery within budget and schedule, adherence to technical requirements, and positive feedback from government stakeholders. Conversely, a history of performance issues or contract disputes would raise concerns about their capability to fulfill this current contract effectively.

How does the $32.3 million award compare to historical spending on IT services by CMS?

Assessing the $32.3 million award in the context of historical CMS IT spending requires access to historical budget and contract data for CMS. This contract, awarded between 2012 and 2016, represents a significant investment in computer systems design services. To benchmark it, one would compare its value and duration against other similar IT service contracts awarded by CMS during that period and preceding years. If CMS typically awards contracts in the tens of millions for similar services over multi-year periods, this award would be within the expected range. If it represents a substantial increase or decrease compared to historical norms, further analysis would be needed to understand the reasons, such as increased scope, market shifts, or changes in procurement strategy.

What are the potential risks associated with a 1580-day contract duration for IT services?

A contract duration of 1580 days (approximately 4.3 years) for IT services carries several potential risks. Firstly, technology evolves rapidly; a system designed or supported under this contract might become outdated before its completion, requiring costly modifications or replacements. Secondly, long-term reliance on a single vendor can lead to vendor lock-in, reducing the government's leverage in future negotiations and potentially stifling innovation. Thirdly, contractor performance can degrade over extended periods if not actively managed and monitored. Finally, changes in agency priorities or federal IT strategies could render the contracted services less relevant, leading to inefficiencies or the need for contract termination, which can incur costs.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Governmentcio LLC (UEI: 080006028)

Address: 7400 FULLERTON RD STE 210, SPRINGFIELD, VA, 22153

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

Financial Breakdown

Contract Ceiling: $32,339,567

Exercised Options: $32,339,567

Current Obligation: $32,339,567

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS06F0612Z

IDV Type: GWAC

Timeline