HHS awards $58.3M for Medicare Shared Savings Program support, with Research Triangle Institute as prime

Contract Overview

Contract Amount: $58,348,814 ($58.3M)

Contractor: Research Triangle Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2016-09-01

End Date: 2021-08-31

Contract Duration: 1,825 days

Daily Burn Rate: $32.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: IGF::OT::IGF - MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS AND OPERATIONAL SUPPORT.

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27709

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $58.3 million to RESEARCH TRIANGLE INSTITUTE for work described as: IGF::OT::IGF - MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS AND OPERATIONAL SUPPORT. Key points: 1. Contract provides essential operational support for a key Medicare initiative aimed at improving healthcare quality and reducing costs. 2. The contract's duration of five years suggests a need for sustained, specialized expertise in program management and analysis. 3. Focus on administrative and management consulting services indicates a reliance on external expertise for program execution. 4. The contract was awarded using full and open competition, suggesting a robust vetting process for potential contractors. 5. The use of Time and Materials pricing may introduce cost variability, requiring diligent oversight to manage expenditures effectively. 6. The contract's value is significant, underscoring the importance of the Accountable Care Organization Program to Medicare's strategic goals.

Value Assessment

Rating: good

The contract value of $58.3 million over five years for administrative and management consulting services appears reasonable given the scope of supporting the Medicare Shared Savings Program. Benchmarking against similar large-scale federal contracts for program support and analysis suggests this is within expected parameters. The Time and Materials (T&M) pricing structure, while common for evolving needs, necessitates careful monitoring to ensure cost efficiency and prevent scope creep. Without specific per-unit cost data for services rendered, a precise value-for-money assessment is challenging, but the overall investment aligns with the strategic importance of the ACO program.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple qualified vendors had the opportunity to bid. This process is designed to foster a competitive environment, theoretically leading to better pricing and service quality. The specific number of bidders is not provided, but the use of this procurement method suggests that the government sought the best value from a wide range of potential contractors. This approach generally benefits the government by ensuring a thorough evaluation of capabilities and costs.

Taxpayer Impact: Full and open competition maximizes the potential for cost savings for taxpayers by encouraging multiple firms to offer their best prices and innovative solutions. It ensures that public funds are used efficiently by selecting the most capable and cost-effective provider.

Public Impact

Beneficiaries of the Medicare Shared Savings Program, including Medicare beneficiaries and participating healthcare providers, indirectly benefit from improved program administration and operational support. The contract supports the Centers for Medicare and Medicaid Services (CMS) in managing and analyzing the Accountable Care Organization (ACO) Program. The geographic impact is national, as the ACO program operates across the United States, aiming to improve healthcare delivery nationwide. The contract supports a workforce of analysts and administrative professionals within the contractor organization, contributing to specialized federal program support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials (T&M) contract type can lead to cost overruns if not closely managed, as it allows for reimbursement of direct labor hours and costs incurred.
The broad scope of 'Administrative Management and General Management Consulting Services' could lead to potential scope creep if not clearly defined and monitored.
Reliance on a single prime contractor for critical program support necessitates robust performance monitoring to ensure continued quality and adherence to objectives.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that likely yielded a qualified and reasonably priced contractor.
The contract supports a vital program (Medicare ACO) focused on improving healthcare quality and reducing costs, indicating alignment with national health priorities.
The five-year duration suggests a stable, long-term partnership, allowing for deep understanding and effective execution of program support functions.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on management and administrative consulting. The federal government is a significant consumer of these services to manage complex programs, conduct research, and provide operational support. The market for such services is large and competitive, with numerous firms offering expertise in areas like healthcare program administration, policy analysis, and operational efficiency. This contract represents a portion of the government's investment in ensuring the effective functioning of major healthcare initiatives like the Medicare ACO program.

Small Business Impact

The provided data indicates that small business participation (ss and sb fields) was not a specific set-aside for this contract. Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside requirement. However, the prime contractor, Research Triangle Institute, may engage small businesses as subcontractors, which would contribute to the small business ecosystem, but this is not explicitly detailed in the award information.

Oversight & Accountability

Oversight for this contract is primarily the responsibility of the Centers for Medicare and Medicaid Services (CMS), the awarding agency. As a Time and Materials contract, CMS will need to implement rigorous oversight mechanisms to monitor labor hours, costs, and deliverables to ensure adherence to the contract's scope and budget. Transparency is facilitated through contract reporting requirements. While no specific Inspector General jurisdiction is mentioned, the HHS Office of Inspector General (OIG) generally has oversight over HHS programs and contracts, including those related to Medicare, to detect and prevent fraud, waste, and abuse.

Related Government Programs

Medicare Shared Savings Program
Accountable Care Organizations
Federal Healthcare Consulting Services
CMS Program Support Contracts
Healthcare Quality Improvement Initiatives

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Risk of scope creep in broad administrative and management consulting services.
Need for robust oversight to ensure effective program support and value for money.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $58.3 million to RESEARCH TRIANGLE INSTITUTE. IGF::OT::IGF - MEDICARE SHARED SAVINGS PROGRAM ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS AND OPERATIONAL SUPPORT.

Who is the contractor on this award?

The obligated recipient is RESEARCH TRIANGLE INSTITUTE.

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 $58.3 million.

What is the period of performance?

Start: 2016-09-01. End: 2021-08-31.

What is the track record of Research Triangle Institute (RTI) in supporting federal healthcare programs, particularly those administered by CMS?

Research Triangle Institute (RTI) has a substantial track record in supporting federal health initiatives, including numerous contracts with the Centers for Medicare and Medicaid Services (CMS) and other agencies like the National Institutes of Health (NIH) and the Agency for Healthcare Research and Quality (AHRQ). Their expertise often lies in program evaluation, data analysis, health services research, and operational support for complex public health programs. RTI has been involved in various aspects of healthcare policy implementation and analysis, contributing to initiatives aimed at improving healthcare quality, access, and affordability. Their experience with programs similar to the Medicare Shared Savings Program suggests a strong capability to fulfill the requirements of this contract, leveraging their established methodologies and deep understanding of federal healthcare landscapes.

How does the $58.3 million contract value compare to similar federal contracts for program analysis and operational support?

The $58.3 million contract value over five years for supporting the Medicare Shared Savings Program is substantial, reflecting the complexity and national scale of the initiative. When compared to similar large-scale federal contracts for program analysis, operational support, and management consulting within the healthcare sector, this figure appears to be within a reasonable range. Contracts supporting major federal health programs often run into tens or hundreds of millions of dollars, especially when they involve extensive data analysis, stakeholder engagement, and long-term operational management. For instance, contracts for managing large public health registries, evaluating national health interventions, or providing IT support for major government health systems can easily reach or exceed this value. The specific nature of supporting the ACO program, which involves intricate provider network management and performance measurement, justifies a significant investment.

What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude and scope?

The primary risks associated with a Time and Materials (T&M) contract of this magnitude ($58.3 million over five years) revolve around cost control and potential scope creep. T&M contracts reimburse the contractor for direct labor hours at specified rates and for the actual cost of materials used. This structure can lead to cost uncertainty for the government if the effort required is underestimated or if inefficiencies arise within the contractor's team. Without a fixed ceiling or well-defined milestones, there's a risk that the project could extend beyond its anticipated duration or complexity, driving up costs. Effective oversight, including detailed tracking of labor hours, regular progress reviews, and strict change control processes, is crucial to mitigate these risks and ensure the government receives good value for its investment.

How effective is the Medicare Shared Savings Program (MSSP) in achieving its goals of improving quality and reducing costs, and how does this contract support those goals?

The Medicare Shared Savings Program (MSSP) aims to improve the quality of care for Medicare beneficiaries while reducing the growth in healthcare costs. Studies and CMS reports indicate that MSSP has shown positive results, particularly in improving care coordination and reducing hospital readmissions. While initial savings have been modest for some ACOs, the program has demonstrated a trend towards cost reduction and quality improvement over time, especially among more established ACOs. This contract directly supports these goals by providing essential analytical and operational support to CMS for managing the MSSP. This includes tasks such as data analysis to track ACO performance, operational guidance to facilitate program participation, and support for policy development and implementation, all of which are critical for the program's continued success and its ability to achieve its quality and cost-saving objectives.

What are the historical spending patterns for administrative and management consulting services within HHS or CMS for similar program support?

HHS and CMS historically spend significant amounts on administrative and management consulting services to support their vast array of programs. These expenditures are driven by the need for specialized expertise in areas such as program design and evaluation, policy analysis, operational efficiency, data management, and IT modernization. Spending on such services can fluctuate based on new policy initiatives, program expansions, or evolving regulatory requirements. For large, complex programs like the Medicare Shared Savings Program, multi-year contracts for comprehensive support are common. While specific historical figures for this exact type of support vary, it is typical for CMS to award contracts in the tens of millions of dollars for critical program management and analytical functions, reflecting the scale and importance of federal healthcare administration.

What are the implications of awarding this contract to Research Triangle Institute (RTI) in terms of market competition and potential contractor performance?

Awarding this contract to Research Triangle Institute (RTI) through full and open competition suggests that RTI was deemed the most capable and cost-effective provider among the bidders. RTI's established presence and experience in federal health contracting indicate a lower performance risk compared to a less experienced firm. In terms of market competition, while this specific award goes to one prime, the full and open competition process itself signals a healthy market where multiple firms can compete for government work. It ensures that the government isn't overly reliant on a single vendor for this type of critical support. The long-term nature of the contract also allows RTI to build deep institutional knowledge, potentially leading to more efficient and effective support over the contract's lifespan.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FCO00CORP0000C

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 3040 E CORNWALLIS RD, RESEARCH TRIANGLE PARK, NC, 27709

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

Financial Breakdown

Contract Ceiling: $58,732,992

Exercised Options: $58,348,814

Current Obligation: $58,348,814

Actual Outlays: $1,115,523

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $2,254,274

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS00F354CA

IDV Type: FSS

Timeline