HHS awards $57.2M for CMS IT operations and maintenance to CGI Federal Inc

Contract Overview

Contract Amount: $57,165,589 ($57.2M)

Contractor: CGI Federal Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2015-08-20

End Date: 2021-02-19

Contract Duration: 2,010 days

Daily Burn Rate: $28.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IGF::OT::IGF CMS OPERATIONS AND MAINTENANCE

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $57.2 million to CGI FEDERAL INC. for work described as: IGF::OT::IGF CMS OPERATIONS AND MAINTENANCE Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 2010 days (approx. 5.5 years) indicates a long-term need for these services. 3. Awarded as a delivery order under a larger contract vehicle, which is a common procurement method. 4. The North American Industry Classification System (NAICS) code 541512 points to computer systems design services. 5. The contract was awarded in Maryland, a hub for federal IT contracting.

Value Assessment

Rating: fair

Benchmarking the value of this contract requires more detailed cost breakdowns and comparisons to similar IT operations and maintenance contracts. The total award amount of $57.2 million over approximately 5.5 years averages to about $10.4 million annually. Without specific performance metrics or a breakdown of services rendered, it's difficult to definitively assess value for money. However, the duration suggests a sustained need, and the competitive award process may have helped control costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The fact that it was a delivery order suggests it was placed against an existing indefinite-delivery indefinite-quantity (IDIQ) contract. The number of bids received (5) provides a moderate level of competition, which is generally favorable for price discovery and ensuring a reasonable price for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces. Full and open competition is the preferred method for maximizing taxpayer value.

Public Impact

The Centers for Medicare and Medicaid Services (CMS) benefits from continuous IT operations and maintenance, ensuring the stability of critical healthcare systems. Beneficiaries of CMS programs, including healthcare providers and patients, indirectly benefit from the reliable functioning of these IT systems. The contract supports IT infrastructure and services essential for managing Medicare and Medicaid programs. The primary geographic impact is within the federal government's IT infrastructure, with potential for workforce implications in the IT services sector in Maryland.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the Time and Materials (T&M) pricing structure is not closely managed.
Dependence on a single contractor for critical IT operations could pose a risk if performance degrades.
The duration of the contract may lead to vendor lock-in if not managed proactively.

Positive Signals

Awarded through full and open competition, indicating a competitive process that likely secured a fair price.
The contract supports essential IT operations for a critical government agency (CMS).
The contractor, CGI Federal Inc., has a significant presence in the federal IT contracting space.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and related services. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. Contracts like this are crucial for ensuring the operational continuity of government IT systems. Comparable spending benchmarks would involve looking at other large-scale IT operations and maintenance contracts awarded by agencies like HHS or other departments with similar IT needs.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The prime contractor, CGI Federal Inc., is a large business, and its subcontracting plans, if any, would be governed by the terms of the larger contract vehicle under which this delivery order was issued.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Centers for Medicare and Medicaid Services (CMS). The contract type (Time and Materials) necessitates close monitoring of labor hours and material costs to ensure compliance and prevent overspending. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

CMS IT Modernization
Federal Health IT Services
Government IT Operations and Maintenance
Department of Health and Human Services IT Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Long contract duration may lead to vendor lock-in or technological obsolescence.
Dependence on a single contractor for critical IT infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $57.2 million to CGI FEDERAL INC.. IGF::OT::IGF CMS OPERATIONS AND MAINTENANCE

Who is the contractor on this award?

The obligated recipient is CGI FEDERAL INC..

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 $57.2 million.

What is the period of performance?

Start: 2015-08-20. End: 2021-02-19.

What is the historical spending pattern for IT operations and maintenance at CMS?

Analyzing historical spending patterns for IT operations and maintenance at CMS is crucial for understanding the context of this $57.2 million award. While specific historical data for this exact service line isn't provided, CMS, as a massive agency managing critical healthcare programs, consistently requires significant investment in IT infrastructure. Trends often show increasing expenditure due to the growing complexity of healthcare data, evolving regulatory requirements, and the need for system modernization. Comparing this contract's value to previous years' spending on similar services would reveal whether costs are escalating, stable, or decreasing, and whether this award represents a typical investment or a deviation.

How does CGI Federal Inc.'s performance on this contract compare to its other federal contracts?

Assessing CGI Federal Inc.'s performance on this specific CMS contract requires access to performance evaluations, such as Contractor Performance Assessment Reporting System (CPARS) data. Without direct access to these detailed reports, a comparative analysis is limited. However, CGI Federal is a large, established government contractor with a broad portfolio across various agencies and service areas. Their overall track record would involve examining past performance on similar IT operations and maintenance contracts, their history of contract awards and terminations, and any documented instances of outstanding performance or significant issues. A review of CPARS data, if available, would provide specific ratings on technical performance, cost control, schedule adherence, and management.

What are the key performance indicators (KPIs) used to measure the success of this contract?

The success of this IT operations and maintenance contract is likely measured through a set of Key Performance Indicators (KPIs) defined in the contract's Statement of Work (SOW). These KPIs would typically focus on system availability and uptime (e.g., 99.9% availability for critical systems), response times for issue resolution (e.g., critical issues resolved within 4 hours), security compliance (e.g., adherence to NIST standards), and successful implementation of system updates or patches. Performance metrics might also include user satisfaction surveys and the efficiency of resource utilization. Regular reporting against these KPIs would be required by CMS to ensure CGI Federal is meeting its contractual obligations and delivering value.

What is the risk profile associated with this contract, considering its duration and scope?

The risk profile for this contract, valued at $57.2 million over approximately 5.5 years, involves several factors. The long duration increases the risk of scope creep, potential for technological obsolescence if not managed proactively, and contractor performance degradation over time. The Time and Materials (T&M) pricing structure, while offering flexibility, carries a higher risk of cost overruns if not meticulously monitored by the government. Dependence on a single contractor for critical IT operations also presents a risk related to business continuity and potential vendor lock-in. Mitigating these risks requires robust government oversight, clear performance metrics, and proactive contract management to ensure alignment with evolving needs and technological advancements.

How does the pricing of this contract compare to market rates for similar IT operations and maintenance services?

Benchmarking the pricing of this $57.2 million contract against market rates for similar IT operations and maintenance services is essential for assessing value for money. Given the contract was awarded under full and open competition, it suggests that the pricing achieved was competitive at the time of award. However, a precise comparison would require detailed analysis of the labor categories, skill levels, and overhead rates proposed by CGI Federal, and then comparing these to industry benchmarks for comparable roles and services in the Washington D.C. metropolitan area. Factors like the specific technologies supported, the criticality of the systems, and the service level agreements (SLAs) also influence market rates. Without a detailed cost breakdown, a definitive market comparison remains challenging.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: NIHJT2010001

Offers Received: 5

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: CGI Inc (UEI: 248513116)

Address: 12601 FAIR LAKES CIR, FAIRFAX, VA, 22033

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

Financial Breakdown

Contract Ceiling: $57,226,313

Exercised Options: $57,165,589

Current Obligation: $57,165,589

Actual Outlays: $2,066,464

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $971,429

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200011W

IDV Type: GWAC

Timeline