HHS awarded $80.7M for professional services to Safeguard Services LLC over nearly 7 years

Contract Overview

Contract Amount: $80,678,071 ($80.7M)

Contractor: Safeguard Services LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2010-09-30

End Date: 2018-04-30

Contract Duration: 2,769 days

Daily Burn Rate: $29.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: TAS::75 8393::TAS ZPIC ZONE 1

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90017

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $80.7 million to SAFEGUARD SERVICES LLC for work described as: TAS::75 8393::TAS ZPIC ZONE 1 Key points: 1. The contract's value appears reasonable given its duration and the breadth of services typically encompassed by 'All Other Professional, Scientific, and Technical Services'. 2. Full and open competition suggests a potentially competitive pricing environment, though specific performance metrics are needed for a definitive value assessment. 3. The contract's long duration (over 7 years) could introduce risks related to evolving needs and potential cost overruns if not actively managed. 4. Performance context is limited without specific details on the services rendered and their impact on CMS objectives. 5. This contract falls within the broad professional services sector, supporting administrative and technical functions for a major health agency. 6. The absence of small business set-aside flags indicates this was not specifically targeted for small business participation.

Value Assessment

Rating: fair

Benchmarking this contract's value is challenging without detailed service descriptions and performance outcomes. However, an average annual spend of approximately $11.5 million for 'All Other Professional, Scientific, and Technical Services' to a major agency like CMS is within a plausible range. Further analysis would require comparing the specific deliverables and their effectiveness against similar contracts or industry standards for professional support services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this requirement. While more bidders could potentially drive prices lower, a competitive process was indeed followed, which is a positive indicator for price discovery.

Taxpayer Impact: Taxpayers benefit from the assurance that the government sought multiple offers, which generally leads to more competitive pricing than a sole-source award.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) through enhanced operational and technical support. Services delivered likely supported administrative, analytical, and technical functions crucial for CMS program administration. The geographic impact is primarily national, given CMS's role in administering federal healthcare programs. Workforce implications may include support for government personnel and potentially the contractor's own workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 7 years) increases the risk of scope creep and potential for costs to exceed initial estimates if not closely monitored.
Lack of specific performance details makes it difficult to assess the true value for money and contractor effectiveness.
The broad 'All Other Professional, Scientific, and Technical Services' category can sometimes mask inefficiencies or less critical tasks if not well-defined.

Positive Signals

Awarded under full and open competition, suggesting a structured procurement process and potential for competitive pricing.
The contract was awarded to a single entity, implying a clear point of accountability for service delivery.
The contract was active for a significant period, suggesting a sustained need for the services provided.

Sector Analysis

This contract falls under the broad professional, scientific, and technical services sector, which is a significant area of federal spending. This sector includes a wide array of support functions, from research and development to administrative and management consulting. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the services, but federal spending in this broad category often runs into tens of billions annually.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This means the competition was open to all eligible firms, including large businesses. While there are no direct subcontracting implications specified, the absence of a small business set-aside suggests that opportunities for small businesses would likely arise through prime contractors if they were involved, or in separate, smaller contract vehicles.

Oversight & Accountability

Oversight for this contract would typically reside with the contracting officer and program managers within the Centers for Medicare and Medicaid Services (CMS). Accountability measures are usually embedded within the contract terms, including performance standards and payment clauses tied to successful delivery. Transparency is generally facilitated through contract award databases, though detailed performance reports are often internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

CMS Administrative Support Contracts
Federal Professional Services Spending
Health Information Technology Services
Government Management Consulting Contracts

Risk Flags

Long contract duration may lead to cost inefficiencies.
Broad service category lacks specificity for detailed performance assessment.
CPAF structure requires strong government oversight for effective cost control and performance evaluation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $80.7 million to SAFEGUARD SERVICES LLC. TAS::75 8393::TAS ZPIC ZONE 1

Who is the contractor on this award?

The obligated recipient is SAFEGUARD SERVICES 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 $80.7 million.

What is the period of performance?

Start: 2010-09-30. End: 2018-04-30.

What specific services did Safeguard Services LLC provide under this contract?

The contract falls under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' This is a broad category that can encompass a wide range of activities, including but not limited to research, data analysis, program management support, technical consulting, and administrative assistance. Without access to the specific contract statement of work (SOW) or task orders issued under this delivery order, it is impossible to detail the exact services rendered. However, given the agency (CMS), the services likely supported the administration, operation, or oversight of federal healthcare programs like Medicare and Medicaid.

How does the $80.7 million award compare to other contracts for similar services at CMS?

Comparing this $80.7 million award requires context regarding the contract's duration and scope. The contract spanned nearly seven years (from September 2010 to April 2018), averaging approximately $11.5 million per year. This annual figure is within a plausible range for professional and technical support services at a large federal agency like CMS. However, a true comparison would necessitate analyzing the specific services provided, the complexity of the tasks, and the number of personnel involved, benchmarked against other CMS contracts for similar support functions or against industry rates for comparable services.

What are the key risks associated with a contract of this duration and value?

A contract valued at $80.7 million over nearly seven years carries several potential risks. Firstly, the extended duration increases the likelihood of scope creep, where the contract's objectives may expand beyond the original intent, potentially leading to cost overruns if not managed strictly. Secondly, the long timeframe can result in outdated technology or methodologies if the contractor is not required to adapt to evolving industry standards. Thirdly, there's a risk of vendor lock-in, making it difficult and costly to transition to a new provider if performance issues arise or needs change significantly. Finally, maintaining consistent oversight and performance management over such a long period requires sustained effort from the government.

What does the 'Cost Plus Award Fee' (PT: COST PLUS AWARD FEE) contract type imply about performance and cost control?

A Cost Plus Award Fee (CPAF) contract type means the contractor is reimbursed for allowable costs plus a fee that has a base component and an award component. The award fee is earned based on the government's subjective evaluation of the contractor's performance against pre-defined criteria. This structure incentivizes high performance, as the contractor can earn a larger fee by exceeding expectations. However, it also requires robust government oversight and clear performance metrics to ensure the award fee is justified and that costs remain controlled, as the 'cost plus' element means the government bears the cost risk.

How has spending on 'All Other Professional, Scientific, and Technical Services' (NAICS 541990) evolved at HHS over time?

Analyzing the evolution of spending on NAICS 541990 at HHS requires historical data beyond this single contract. This specific contract represents spending from FY2010 to FY2018. To understand the trend, one would need to examine HHS's total obligations for this NAICS code across multiple fiscal years, looking for patterns of increase or decrease. Factors influencing this evolution could include shifts in agency priorities, changes in federal budgeting, the introduction of new programs requiring specialized support, or the consolidation or expansion of service needs within HHS agencies like CMS.

What is the significance of the contract being a 'Delivery Order' (AW: DELIVERY ORDER)?

A Delivery Order (DO) typically indicates that this contract is a task order or delivery order issued against a larger, pre-existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar multiple-award contract vehicle. This means that the $80.7 million represents the total value awarded under this specific order, but the underlying IDIQ contract may have a much larger ceiling value and could have been competed previously. Delivery orders allow agencies to procure services incrementally as needed, offering flexibility but also requiring careful management to ensure the total spending aligns with program requirements and budget constraints.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFPCMS20080014

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 5400 LEGACY DRIVE, PLANO, TX, 75024

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

Financial Breakdown

Contract Ceiling: $80,678,071

Exercised Options: $80,678,071

Current Obligation: $80,678,071

Actual Outlays: $22,754

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSM500201000022I

IDV Type: IDC

Timeline