CMS awards $23.9M contract for pricing data analysis to Noridian Healthcare Solutions, LLC

Contract Overview

Contract Amount: $23,923,987 ($23.9M)

Contractor: Noridian Healthcare Solutions, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2013-09-06

End Date: 2019-03-01

Contract Duration: 2,002 days

Daily Burn Rate: $11.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Healthcare

Official Description: PRICING DATA ANALYSIS AND CODING CONTRACT FOR CMS, IGF::OT::IGF

Place of Performance

Location: FARGO, CASS County, NORTH DAKOTA, 58103

State: North Dakota Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $23.9 million to NORIDIAN HEALTHCARE SOLUTIONS, LLC for work described as: PRICING DATA ANALYSIS AND CODING CONTRACT FOR CMS, IGF::OT::IGF Key points: 1. Contract value of $23.9 million over approximately 5.5 years. 2. Awarded through full and open competition. 3. Noridian Healthcare Solutions, LLC is the sole awardee. 4. Contract type is Cost Plus Fixed Fee. 5. The contract supports 'All Other Insurance Related Activities'. 6. Performance period spans from September 2013 to March 2019.

Value Assessment

Rating: fair

The contract's total value of $23.9 million over nearly six years suggests a moderate annual spend. Benchmarking this against similar contracts for data analysis and IT services within HHS is challenging without more specific service details. The Cost Plus Fixed Fee (CPFF) structure can sometimes lead to higher costs if not managed carefully, as it incentivizes cost incurrence. However, the fixed fee component provides some cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 3 bidders suggests a reasonable level of competition for this specific requirement. While not a large number, it is sufficient to provide some price discovery and ensure the government receives a fair offer.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) and potentially healthcare providers and beneficiaries through improved data analysis. Services delivered include pricing data analysis and related activities. Geographic impact is national, given CMS's scope. Workforce implications may include employment for data analysts, IT professionals, and administrative staff at Noridian Healthcare Solutions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can sometimes lead to cost overruns if not closely monitored.
The duration of the contract (over 5 years) requires sustained oversight to ensure continued value.
Specific performance metrics and outcomes are not detailed in the provided data, making it difficult to assess effectiveness.
The 'All Other Insurance Related Activities' category is broad and may lack specificity in performance expectations.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Multiple bidders (3) participated, suggesting market interest and some level of competition.
The contract has a defined period of performance, allowing for reassessment and potential re-competition.
Noridian Healthcare Solutions, LLC is the selected vendor, implying they met the government's requirements.

Sector Analysis

This contract falls within the broader IT and professional services sector, specifically focusing on data analysis for healthcare administration. The market for such services is substantial, driven by the increasing need for government agencies, like CMS, to manage and analyze vast amounts of data for operational efficiency, policy development, and fraud detection. Comparable spending benchmarks would typically be found within IT services, data analytics, and specialized healthcare consulting categories.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). There is no information on subcontracting plans. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless Noridian Healthcare Solutions voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. The Department of Health and Human Services (HHS) Office of Inspector General (OIG) may also conduct audits or investigations related to the contract's performance and financial management. Transparency is facilitated through contract databases like FPDS, but detailed performance reports are typically internal.

Related Government Programs

CMS Data Analytics Contracts
Healthcare IT Services
Insurance Related Activities
Federal IT Professional Services
Cost Plus Fixed Fee Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Broad contract description ('All Other Insurance Related Activities') may obscure specific performance expectations.
Contract duration necessitates sustained monitoring for continued value and relevance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $23.9 million to NORIDIAN HEALTHCARE SOLUTIONS, LLC. PRICING DATA ANALYSIS AND CODING CONTRACT FOR CMS, IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is NORIDIAN HEALTHCARE SOLUTIONS, 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 $23.9 million.

What is the period of performance?

Start: 2013-09-06. End: 2019-03-01.

What is the track record of Noridian Healthcare Solutions, LLC with federal contracts, particularly within HHS?

Noridian Healthcare Solutions, LLC has a history of federal contracting, primarily with the Centers for Medicare & Medicaid Services (CMS). They have been involved in various roles, often related to Medicare and Medicaid operations, claims processing, and data management. Their experience includes managing large-scale government contracts, which suggests a familiarity with federal acquisition regulations and performance expectations. However, a detailed analysis of their past performance, including any past performance issues or commendations, would require a deeper dive into contract award histories and performance reviews beyond the scope of this summary. Their longevity in serving CMS indicates a sustained ability to meet contractual obligations.

How does the pricing of this contract compare to similar data analysis contracts awarded by CMS or other federal agencies?

Benchmarking the pricing of this $23.9 million contract for pricing data analysis is challenging without specific details on the scope of work and deliverables. Contracts for data analysis can vary significantly in cost based on complexity, data volume, required expertise (e.g., data scientists, statisticians), and the duration of the engagement. A Cost Plus Fixed Fee (CPFF) structure, as used here, means the government pays the actual costs incurred plus a fixed fee for profit. To compare effectively, one would need to analyze the 'cost' component and the 'fixed fee' as a percentage of total costs for similar CPFF contracts within HHS or other agencies performing comparable data analysis tasks. Annualized spending of approximately $4.3 million ($23.9M / 5.5 years) provides a rough baseline, but direct comparisons require detailed service-level data.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this nature?

The primary risks associated with a CPFF contract like this one involve potential cost overruns and contractor inefficiency. While the fixed fee provides a profit ceiling, the 'cost plus' element means the government bears the risk of actual costs incurred. If the contractor's cost management is poor, or if unforeseen complexities arise, the total cost to the government can escalate beyond initial projections. There's also a risk that the contractor might not be sufficiently incentivized to control costs aggressively, as their profit is fixed regardless of the final cost. Effective oversight, detailed cost tracking, and robust performance management are crucial to mitigate these risks and ensure value for taxpayer money.

How effective has Noridian Healthcare Solutions been in delivering services under this specific contract?

Assessing the effectiveness of Noridian Healthcare Solutions under this specific contract requires access to performance reports, quality metrics, and potentially user feedback from CMS. The provided data summary does not include these details. Typically, contract effectiveness is evaluated based on the contractor's ability to meet performance standards, deliver services on time, stay within budget (considering the CPFF structure), and achieve the intended outcomes of the contract. Without specific performance data or government evaluations, it's impossible to definitively state the effectiveness of their service delivery for this particular award.

What has been the historical spending trend for pricing data analysis or similar services at CMS over the past decade?

Historical spending trends for pricing data analysis and related services at CMS are not directly available from the provided data snippet. However, federal spending on IT, data analytics, and healthcare administration services has generally increased over the past decade, driven by technological advancements, the need for better data-driven decision-making, and the complexity of managing programs like Medicare and Medicaid. To understand the trend for this specific contract category, one would need to analyze historical contract awards data from sources like the Federal Procurement Data System (FPDS) for similar North American Industry Classification System (NAICS) codes or Product Service Codes (PSCs) related to data analysis and insurance activities within CMS.

Industry Classification

NAICS: Finance and Insurance › Agencies, Brokerages, and Other Insurance Related Activities › All Other Insurance Related Activities

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HHSM5002013RFP0019

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Noridian Mutual Insurance Company

Address: 900 42TH ST S, FARGO, ND, 58108

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

Financial Breakdown

Contract Ceiling: $23,923,987

Exercised Options: $23,923,987

Current Obligation: $23,923,987

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline