HHS awarded $41.8M for hospital innovation, with 16 bids received under full and open competition

Contract Overview

Contract Amount: $41,816,940 ($41.8M)

Contractor: Premier Healthcare Solutions, Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2016-09-28

End Date: 2020-03-31

Contract Duration: 1,280 days

Daily Burn Rate: $32.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 16

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: HOSPITAL INNOVATION IMPROVEMENT NETWORK CONTRACT - IGF::CT::IGF

Place of Performance

Location: CHARLOTTE, MECKLENBURG County, NORTH CAROLINA, 28277

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $41.8 million to PREMIER HEALTHCARE SOLUTIONS, INC for work described as: HOSPITAL INNOVATION IMPROVEMENT NETWORK CONTRACT - IGF::CT::IGF Key points: 1. Contract value appears reasonable given the scope of improving hospital innovation and efficiency. 2. Strong competition with 16 bidders suggests a healthy market for these services. 3. Risk indicators are low due to a firm-fixed-price contract type and defined period of performance. 4. Performance context involves enhancing healthcare delivery through innovation initiatives. 5. This contract falls within the administrative management and consulting services sector.

Value Assessment

Rating: good

The contract value of $41.8 million over approximately 3.5 years for a national hospital innovation program appears to be a fair investment. Benchmarking against similar large-scale healthcare consulting or program management contracts would provide a more precise value-for-money assessment. However, the scope suggests a significant undertaking aimed at widespread impact, which can justify substantial funding.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 16 bids received. This high level of participation indicates a robust market and suggests that the government received a competitive range of proposals, likely leading to a more favorable price and a wider selection of qualified contractors.

Taxpayer Impact: The extensive competition benefits taxpayers by driving down costs and ensuring the selection of the most capable provider for this critical healthcare initiative.

Public Impact

Hospitals across the nation are direct beneficiaries, receiving support to innovate and improve patient care. Services delivered include program management, technical assistance, and data analysis to foster innovation. The geographic impact is national, aiming to improve healthcare delivery systems nationwide. Workforce implications may include training and development for hospital staff involved in innovation projects.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded under full and open competition, indicating broad market interest and potential for competitive pricing.
Firm-fixed-price contract type helps control costs and provides budget certainty.
Defined period of performance (approx. 3.5 years) allows for structured program execution and evaluation.
Contract awarded to Premier Healthcare Solutions, Inc., a known entity in the healthcare services space.

Sector Analysis

This contract operates within the healthcare services sector, specifically focusing on management and consulting for hospital innovation. The market for healthcare consulting is substantial, driven by the need for efficiency, quality improvement, and adaptation to new technologies and regulations. This contract aligns with broader government efforts to modernize healthcare delivery and improve patient outcomes.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the large contract value and the nature of the services, it is possible that larger firms were primary awardees, with potential for small business involvement through subcontracting if pursued by the prime contractor.

Oversight & Accountability

Oversight is likely managed by the Centers for Medicare and Medicaid Services (CMS) program officials. Accountability measures would be tied to performance metrics and milestones outlined in the contract. Transparency is generally facilitated through contract award databases, though detailed performance reports may not always be publicly available.

Related Government Programs

Hospital Value-Based Purchasing Program
Medicare Quality Payment Program
Healthcare Innovation Challenge

Risk Flags

Potential for scope creep if innovation goals are not clearly defined.
Risk of contractor underperformance if innovation targets are too ambitious for the fixed price.
Ensuring equitable distribution of benefits across diverse hospital types and regions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $41.8 million to PREMIER HEALTHCARE SOLUTIONS, INC. HOSPITAL INNOVATION IMPROVEMENT NETWORK CONTRACT - IGF::CT::IGF

Who is the contractor on this award?

The obligated recipient is PREMIER HEALTHCARE SOLUTIONS, 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 $41.8 million.

What is the period of performance?

Start: 2016-09-28. End: 2020-03-31.

What specific innovation metrics were used to evaluate contractor performance?

The provided data does not detail the specific performance metrics used to evaluate Premier Healthcare Solutions, Inc. for the Hospital Innovation Improvement Network Contract. Typically, such contracts would include metrics related to the number of innovative practices adopted by participating hospitals, improvements in patient outcomes (e.g., reduced readmission rates, improved patient satisfaction scores), cost savings achieved through innovation, and the successful dissemination of best practices across the network. A thorough review of the contract's Statement of Work (SOW) and any associated performance work statements (PWS) would be necessary to identify these specific metrics and assess the contractor's performance against them.

How does the $41.8 million contract value compare to similar federal initiatives aimed at hospital innovation?

Comparing the $41.8 million contract value requires identifying similar federal programs focused on hospital innovation and their respective funding levels. For instance, CMS's Center for Medicare & Medicaid Innovation (CMMI) has funded numerous initiatives, some of which involve significant investments in testing new payment and service delivery models. While direct comparisons are difficult without knowing the exact scope and duration of other programs, $41.8 million over approximately 3.5 years suggests a substantial, multi-faceted effort. It's within the range of large-scale demonstration projects or network-building efforts designed to achieve broad impact across the healthcare system.

What is the track record of Premier Healthcare Solutions, Inc. in managing large federal healthcare contracts?

Premier Healthcare Solutions, Inc. has a history of working with federal agencies, including the Department of Health and Human Services. While specific details on their track record with large innovation-focused contracts are not in the provided summary, their ability to win a competitive bid for this $41.8 million contract suggests a demonstrated capability. A deeper analysis would involve reviewing their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), other federal awards, and their experience in program management, technical assistance, and healthcare consulting to fully assess their suitability and past success.

What are the potential risks associated with a firm-fixed-price contract for an innovation program?

While firm-fixed-price (FFP) contracts are generally favored for cost control, they can present risks in innovation-focused programs where the path to success may be uncertain or require flexibility. If the scope is too rigidly defined, it might stifle creativity or lead to the contractor being penalized for unforeseen challenges inherent in innovation. Conversely, if the scope is too broad, the contractor might underbid, leading to quality compromises or requests for change orders. For this contract, the risk lies in ensuring the FFP structure adequately incentivizes innovation while managing the inherent uncertainties of developing and implementing new healthcare models.

How has spending on administrative management and general management consulting services evolved within HHS over the past five years?

Spending on administrative management and general management consulting services (NAICS code 541611) within HHS has generally been significant, reflecting the complexity of managing large healthcare programs and initiatives. While specific year-over-year trends for HHS alone require detailed budget analysis, the overall federal spending in this category often fluctuates based on agency priorities, new program launches, and the need for specialized expertise. Contracts like the Hospital Innovation Improvement Network highlight a continued reliance on external expertise to drive strategic goals, suggesting sustained or potentially increasing investment in these services to tackle complex challenges like healthcare innovation.

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: HHSM5002016RFP0026

Offers Received: 16

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Premier, Inc. (UEI: 079174944)

Address: 13034 BALLANTYNE CORPORATE PL, CHARLOTTE, NC, 28277

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

Financial Breakdown

Contract Ceiling: $41,816,940

Exercised Options: $41,816,940

Current Obligation: $41,816,940

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline