HHS awarded $94M for administrative management consulting, with a significant portion going to StrategicHealthSolutions, LLC

Contract Overview

Contract Amount: $94,016,279 ($94.0M)

Contractor: Strategichealthsolutions, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2012-09-27

End Date: 2018-06-26

Contract Duration: 2,098 days

Daily Burn Rate: $44.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF

Place of Performance

Location: OMAHA, DOUGLAS County, NEBRASKA, 68114

State: Nebraska Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $94.0 million to STRATEGICHEALTHSOLUTIONS, LLC for work described as: IGF::OT::IGF Key points: 1. The contract's value of $94 million over its period of performance suggests a substantial need for administrative management services within HHS. 2. While the specific services rendered are not detailed, the broad category of 'Administrative Management and General Management Consulting Services' implies a wide range of potential support. 3. The contract was awarded under full and open competition, indicating a potentially competitive bidding process that could lead to better pricing. 4. The fixed-price contract type generally shifts performance risk to the contractor, which can be beneficial for the government if managed effectively. 5. The duration of the contract (2098 days) suggests a long-term need or a phased approach to service delivery. 6. The absence of small business set-aside flags warrants further investigation into opportunities for small businesses in this contracting area.

Value Assessment

Rating: fair

Benchmarking the value of this $94 million contract is challenging without specific details on the services provided and their impact. However, the contract's duration and total value indicate a significant investment by the Centers for Medicare and Medicaid Services. Comparing it to similar large-scale administrative consulting contracts within HHS or other federal agencies would be necessary for a more precise value assessment. The fixed-price nature suggests an attempt to control costs, but the overall value-for-money depends heavily on the quality and effectiveness of the consulting services delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' suggesting that all responsible sources were permitted to submit bids. The fact that there were 2 bids received indicates a moderate level of competition for this contract. While more than one bidder is positive, a higher number of bids typically leads to more robust price discovery and potentially lower costs for the government. The limited number of bidders could suggest specific expertise required or a niche market.

Taxpayer Impact: A competitive process, even with a limited number of bidders, generally benefits taxpayers by encouraging more favorable pricing and service offerings compared to sole-source awards.

Public Impact

Beneficiaries likely include federal agencies within the Department of Health and Human Services, particularly the Centers for Medicare and Medicaid Services, who receive administrative and management consulting support. Services delivered could encompass a wide array of general management consulting, strategic planning, process improvement, and administrative support functions. The geographic impact is likely national, given the scope of CMS operations, though specific project locations would depend on the nature of the consulting work. Workforce implications could include the engagement of specialized consulting professionals and potentially the enhancement of internal government workforce capabilities through knowledge transfer.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on services rendered makes it difficult to assess the true value and impact of the consulting.
The moderate competition level (2 bidders) might indicate potential for higher costs than if more firms had competed.
The broad NAICS code (541611) covers a wide range of services, making it hard to pinpoint the exact nature of the work and associated risks.
No explicit mention of small business participation or subcontracting goals requires further review to ensure equitable opportunities.

Positive Signals

Awarded under full and open competition, which generally promotes fairness and broader market access.
The firm-fixed-price contract type shifts financial risk to the contractor, encouraging efficient service delivery.
The contract's duration suggests a sustained need and potential for long-term strategic support for CMS.
The significant contract value indicates a high level of trust and perceived capability from the awarded contractor.

Sector Analysis

The administrative management and general management consulting services sector is a significant part of the federal contracting landscape, supporting a wide array of government functions. This contract falls within a broad category that enables agencies like CMS to optimize operations, improve efficiency, and implement strategic initiatives. Comparable spending benchmarks would typically involve analyzing the average cost of similar consulting engagements within the federal government, considering factors like contract duration, scope, and the specific expertise required.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (sb: false). The absence of small business participation flags suggests that small businesses may not have been primary awardees or that subcontracting opportunities for them were not explicitly detailed in this record. Further analysis would be needed to determine if small businesses were involved as subcontractors or if there were missed opportunities to engage them in this significant contract.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Centers for Medicare and Medicaid Services (CMS). As a federal contract, it is subject to standard government oversight mechanisms, including performance reviews, audits, and potentially reviews by the HHS Office of Inspector General (OIG) if specific concerns arise. Transparency is generally facilitated through contract databases like FPDS, though detailed performance reports are often internal.

Related Government Programs

HHS Administrative Support Contracts
CMS Management Consulting Services
Federal General Management Consulting
Government Operations Improvement Contracts

Risk Flags

Limited competition may impact price.
Scope definition for broad consulting services can be challenging.
Need for detailed performance metrics to ensure value.
Potential for contractor to prioritize profit over quality in FFP contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $94.0 million to STRATEGICHEALTHSOLUTIONS, LLC. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is STRATEGICHEALTHSOLUTIONS, 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 $94.0 million.

What is the period of performance?

Start: 2012-09-27. End: 2018-06-26.

What specific consulting services were provided under this contract?

The provided data classifies this contract under NAICS code 541611: Administrative Management and General Management Consulting Services. This broad category encompasses a wide range of potential services, including strategic planning, organizational analysis, process improvement, operational efficiency studies, and general management advice. Without more granular information, it's impossible to detail the exact services rendered. However, given the contracting agency (Centers for Medicare and Medicaid Services), the services likely supported CMS's complex administrative and operational needs related to healthcare programs, policy implementation, or program management.

How does the awarded amount of $94 million compare to similar contracts for administrative consulting within HHS?

Comparing the $94 million award requires context regarding the contract's duration (2098 days, approximately 5.7 years) and the specific scope of services. For long-term, broad-scope administrative consulting engagements within a large agency like HHS, $94 million is a substantial figure, reflecting significant needs. However, without access to a database of comparable HHS contracts with detailed service descriptions and performance metrics, a precise benchmark is difficult. Generally, large federal agencies frequently award multi-million dollar contracts for specialized consulting services to address complex challenges, making this amount significant but not necessarily outlier-high for the sector and agency size.

What are the potential risks associated with a firm-fixed-price contract of this magnitude and duration?

A firm-fixed-price (FFP) contract aims to provide price certainty for the government. However, risks exist. For the contractor, if the scope of work is not well-defined or if unforeseen challenges arise, they could incur losses if costs exceed the fixed price. For the government, the primary risk is that the contractor might cut corners on quality or service delivery to maximize profit within the fixed price, especially over a long duration. Effective oversight and clear performance metrics are crucial to mitigate this risk. Additionally, if the initial price was not accurately estimated due to poor scope definition, the government might end up overpaying for the services received.

What does the limited competition (2 bidders) suggest about the market for these services?

The fact that only two bids were received for this 'full and open' competition suggests a potentially specialized or concentrated market for the specific administrative management and general management consulting services required by CMS. This could be due to several factors: a high barrier to entry (e.g., specific expertise, security clearances, past performance requirements), a limited number of firms capable of performing at this scale, or perhaps the specific timing and solicitation details did not attract a wider pool. While competition is present, a lower number of bidders can sometimes lead to less aggressive pricing compared to scenarios with numerous competitors.

What is the historical spending pattern for administrative management consulting services at CMS?

Historical spending patterns for administrative management consulting at CMS are not detailed in the provided data. However, agencies like CMS, which manage vast and complex healthcare programs (like Medicare and Medicaid), consistently require external expertise for operational efficiency, policy analysis, and program management. It is reasonable to assume that CMS has engaged in numerous consulting contracts over the years, likely varying in size and scope, to address evolving healthcare landscapes and administrative challenges. Analyzing historical spending would require accessing comprehensive federal procurement databases over multiple fiscal years.

What is the track record of StrategicHealthSolutions, LLC as a federal contractor?

The provided data identifies STRATEGICHEALTHSOLUTIONS, LLC as the contractor for this specific award. To assess their track record, one would need to examine their complete federal contracting history, including other awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any past issues or disputes. Without this broader context, it's difficult to definitively characterize their overall performance. However, being awarded a $94 million contract by CMS suggests they possess the capabilities and have met the requirements deemed necessary by the agency for this significant engagement.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: MEDICAL SERVICES › NURSING, NURSING HOME, EVAL/SCREEN

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2010 S 182ND CIR, OMAHA, NE, 68130

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $94,016,279

Exercised Options: $94,016,279

Current Obligation: $94,016,279

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS10F0231T

IDV Type: FSS

Timeline