HHS awarded $39M contract for hospital engagement networks to improve patient care quality

Contract Overview

Contract Amount: $38,973,268 ($39.0M)

Contractor: Health Research and Educational Trust

Awarding Agency: Department of Health and Human Services

Start Date: 2015-09-24

End Date: 2016-09-23

Contract Duration: 365 days

Daily Burn Rate: $106.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 26

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: IGF::OT::IGF DQIIMT PARTNERSHIP FOR PATIENTS 2.0, HOSPITAL ENGAGEMENT NETWORKS (HENS), AMERICAN HOSPITAL ASSOCIATION

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $39.0 million to HEALTH RESEARCH AND EDUCATIONAL TRUST for work described as: IGF::OT::IGF DQIIMT PARTNERSHIP FOR PATIENTS 2.0, HOSPITAL ENGAGEMENT NETWORKS (HENS), AMERICAN HOSPITAL ASSOCIATION Key points: 1. Contract focused on improving patient outcomes and reducing healthcare costs through hospital partnerships. 2. Administrative management and consulting services were the primary focus of this engagement. 3. The contract was awarded under full and open competition, suggesting a robust bidding process. 4. Performance period was relatively short, indicating a focused initiative rather than long-term support. 5. The fixed-price nature of the contract aimed to control costs and ensure predictable spending. 6. This initiative aligns with broader federal efforts to enhance healthcare quality and efficiency.

Value Assessment

Rating: good

The contract value of $38.97 million for a one-year period appears reasonable for a national-level healthcare initiative involving multiple hospital networks. Benchmarking against similar large-scale public health programs suggests that the investment is in line with efforts to drive systemic improvements in patient care. The fixed-price contract structure provides cost certainty, which is a positive indicator for value for money. Without specific per-unit cost data for patient engagement activities, a direct cost comparison is difficult, but the overall award seems appropriate for the stated objectives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 26 bids suggests a competitive marketplace for these types of administrative and management consulting services in the healthcare sector. This level of competition is generally favorable for price discovery and ensures that the government can select the most capable and cost-effective solution. The wide range of bidders likely drove down prices and encouraged innovative approaches.

Taxpayer Impact: A competitive bidding process for this contract helps ensure that taxpayer funds are used efficiently by selecting the best value offer. It prevents single-source price inflation and promotes a market-driven approach to service procurement.

Public Impact

Beneficiaries include hospitals participating in the engagement networks, aiming to improve their internal processes. Services delivered focus on enhancing patient safety, reducing hospital-acquired infections, and improving overall care coordination. The geographic impact is national, as it involves hospitals across the United States seeking to adopt best practices. Workforce implications include training and resource allocation within participating hospitals to implement new care models.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Short performance period may limit the long-term sustainability of implemented changes.
Reliance on administrative consulting may not directly address frontline clinical resource constraints.
Measuring the direct impact of engagement on patient outcomes requires robust data collection and analysis.

Positive Signals

Focus on patient safety and quality improvement aligns with critical healthcare goals.
Involvement of hospital networks promotes scalable adoption of best practices.
Full and open competition suggests a well-structured procurement process.

Sector Analysis

This contract falls within the administrative management and general management consulting services sector, specifically tailored for healthcare. The market for healthcare consulting is substantial, driven by the complexity of regulations, the need for operational efficiency, and the continuous push for quality improvement. This contract represents a targeted investment by CMS to leverage external expertise in improving hospital performance, fitting within a broader trend of government agencies seeking specialized support to achieve policy objectives in complex sectors like healthcare.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions. Given the nature and scale of the services required (national hospital engagement networks), it is likely that larger, established consulting firms or healthcare organizations with significant infrastructure were the primary bidders. Subcontracting opportunities for small businesses might exist within the prime contractor's delivery model, but this is not explicitly detailed in the award information. The absence of set-asides suggests the focus was on securing the most qualified large-scale provider.

Oversight & Accountability

Oversight for this contract would typically fall under the Centers for Medicare and Medicaid Services (CMS), the awarding agency. Accountability measures would be embedded in the contract's performance standards and reporting requirements. Transparency is facilitated through the Federal Procurement Data System (FPDS), where contract awards are publicly recorded. While no specific Inspector General (IG) jurisdiction is mentioned for this particular award, the HHS Office of Inspector General (OIG) generally oversees programs within the department to prevent fraud, waste, and abuse.

Related Government Programs

Partnership for Patients Initiative
Hospital Readmissions Reduction Program
Quality Payment Program (QPP)
Centers for Medicare & Medicaid Services (CMS) Initiatives

Risk Flags

Potential for vendor lock-in if successful models are not easily transferable.
Difficulty in attributing direct patient outcome improvements solely to this contract.
Risk of limited long-term impact due to the one-year duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $39.0 million to HEALTH RESEARCH AND EDUCATIONAL TRUST. IGF::OT::IGF DQIIMT PARTNERSHIP FOR PATIENTS 2.0, HOSPITAL ENGAGEMENT NETWORKS (HENS), AMERICAN HOSPITAL ASSOCIATION

Who is the contractor on this award?

The obligated recipient is HEALTH RESEARCH AND EDUCATIONAL TRUST.

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 $39.0 million.

What is the period of performance?

Start: 2015-09-24. End: 2016-09-23.

What was the primary objective of the 'Partnership for Patients 2.0' initiative?

The primary objective of the 'Partnership for Patients 2.0' initiative, under which this contract was awarded, was to improve the quality and safety of healthcare across the nation. Specifically, it aimed to reduce preventable hospital-acquired conditions and hospital readmissions, thereby lowering healthcare costs and improving patient outcomes. The initiative focused on engaging hospitals to adopt evidence-based practices and innovative care models through the establishment and support of Hospital Engagement Networks (HENs). This contract provided the administrative and educational support necessary for these networks to function effectively and achieve their quality improvement goals.

How does the $38.97 million award compare to other federal spending on healthcare consulting?

The $38.97 million award for this specific initiative represents a significant but not extraordinary investment within the broader federal healthcare spending landscape. Federal agencies, particularly HHS and CMS, frequently award contracts for consulting and program management services related to healthcare quality, efficiency, and policy implementation. While this amount is substantial for a single-year contract focused on a specific program like Partnership for Patients 2.0, it is comparable to other large-scale federal health initiatives. For instance, contracts for developing and managing large health IT systems, conducting major public health research, or implementing nationwide public health campaigns can often reach or exceed this figure. The value is justified by the potential to impact millions of patient lives and generate substantial savings through reduced adverse events and readmissions.

What are the key performance indicators (KPIs) expected from the Health Research and Educational Trust under this contract?

While the specific KPIs are not detailed in the award abstract, contracts for initiatives like Partnership for Patients 2.0 typically focus on measurable improvements in patient safety and care quality. Expected KPIs would likely include reductions in specific hospital-acquired conditions (e.g., central line-associated bloodstream infections, surgical site infections), decreases in hospital readmission rates for certain conditions, improvements in patient experience scores, and the adoption rate of evidence-based care protocols across participating hospitals. The Health Research and Educational Trust would be expected to report regularly on progress towards these metrics, demonstrating the effectiveness of the engagement networks and the value derived from the federal investment.

What is the significance of the 'Administrative Management and General Management Consulting Services' NAICS code (541611) in this context?

The North American Industry Classification System (NAICS) code 541611, 'Administrative Management and General Management Consulting Services,' signifies that the primary service procured under this contract involves providing expert advice and assistance to other organizations on administrative and management issues. In the context of this HHS contract, it means the Health Research and Educational Trust was engaged to provide strategic guidance, operational planning, program management, and potentially process improvement expertise to the Hospital Engagement Networks. This code indicates that the focus was on the 'how-to' of managing and improving healthcare delivery systems, rather than direct provision of medical services or development of specific technologies.

Were there any notable risks identified during the procurement or award of this contract?

The award abstract does not explicitly list identified risks associated with this specific contract's procurement or award. However, general risks inherent in large-scale healthcare quality improvement initiatives include challenges in achieving widespread adoption of best practices, variability in hospital performance and engagement, difficulties in accurately measuring outcomes, and potential for vendor performance issues. The use of a firm-fixed-price contract and full and open competition suggests that the agency aimed to mitigate financial and vendor selection risks, respectively. Ongoing monitoring and evaluation would be crucial to manage performance and outcome risks throughout the contract period.

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) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFPCMSAPP1504912015

Offers Received: 26

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: American Hospital Association (UEI: 051064566)

Address: 155 N WACKER DR STE 400, CHICAGO, IL, 60606

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $38,973,268

Exercised Options: $38,973,268

Current Obligation: $38,973,268

Subaward Activity

Number of Subawards: 77

Total Subaward Amount: $50,315,172

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline