HHS Awards $219M Task Order to Safeguard Services LLC for Fraud Combat in North-Eastern Jurisdiction

Contract Overview

Contract Amount: $219,079,652 ($219.1M)

Contractor: Safeguard Services LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2016-11-01

End Date: 2026-10-31

Contract Duration: 3,651 days

Daily Burn Rate: $60.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS AWARD FEE

Sector: Healthcare

Official Description: IGF::OT::IGF UPIC TASK ORDER AWARD TO COMBAT FRAUD, WASTE AND ABUSE IN THE NORTH-EASTERN JURISDICTION

Place of Performance

Location: PLANO, COLLIN County, TEXAS, 75024

State: Texas Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $219.1 million to SAFEGUARD SERVICES LLC for work described as: IGF::OT::IGF UPIC TASK ORDER AWARD TO COMBAT FRAUD, WASTE AND ABUSE IN THE NORTH-EASTERN JURISDICTION Key points: 1. The award is a significant investment in combating fraud, waste, and abuse within the healthcare sector. 2. Safeguard Services LLC, the sole awardee, operates in the 'All Other Professional, Scientific, and Technical Services' category. 3. The contract duration of nearly 10 years suggests a long-term commitment to addressing complex issues. 4. The 'Cost Plus Award Fee' contract type allows for performance-based incentives, potentially driving efficiency.

Value Assessment

Rating: fair

The contract is a Cost Plus Award Fee type, which can lead to higher costs if not managed carefully. Benchmarking against similar contracts for fraud detection services is difficult without more specific cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating a competitive bidding process. However, the specific details of the price discovery and negotiation are not provided.

Taxpayer Impact: The effectiveness of fraud, waste, and abuse reduction directly impacts taxpayer money by preventing improper payments and ensuring program integrity.

Public Impact

Improved oversight of federal healthcare programs, potentially saving taxpayer dollars. Enhanced efforts to identify and prosecute fraudulent activities within Medicare and Medicaid. Increased efficiency in the administration of healthcare services by reducing waste. Potential for better resource allocation within the Centers for Medicare and Medicaid Services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee structure requires careful monitoring to ensure cost control.
Long contract duration may not adapt well to evolving fraud tactics.
Lack of specific performance metrics makes it hard to assess value for money.
Geographic focus on 'North-Eastern Jurisdiction' might limit broader applicability.

Positive Signals

Awarded through full and open competition.
Focus on critical area of fraud, waste, and abuse.
Potential for significant cost savings through effective fraud detection.

Sector Analysis

This contract falls under professional, scientific, and technical services, specifically related to government program integrity. Spending in this area is crucial for ensuring the efficient and ethical use of public funds, particularly in large sectors like healthcare.

Small Business Impact

The data indicates this was a large contract award, and there is no specific mention of small business participation. Further analysis would be needed to determine if small businesses were involved as subcontractors or if opportunities were missed.

Oversight & Accountability

The 'IGF::OT::IGF' designation suggests internal government oversight mechanisms are in place. However, the effectiveness of this oversight in managing a Cost Plus Award Fee contract over a decade requires continuous monitoring.

Related Government Programs

All Other Professional, Scientific, and Technical Services
Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Potential for cost overruns due to CPAF structure.
Long contract duration may lead to outdated methods.
Lack of specific performance metrics in the provided data.
Geographic limitation of 'North-Eastern Jurisdiction'.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $219.1 million to SAFEGUARD SERVICES LLC. IGF::OT::IGF UPIC TASK ORDER AWARD TO COMBAT FRAUD, WASTE AND ABUSE IN THE NORTH-EASTERN JURISDICTION

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 $219.1 million.

What is the period of performance?

Start: 2016-11-01. End: 2026-10-31.

What specific metrics will be used to measure the success of Safeguard Services LLC in combating fraud, waste, and abuse?

The contract's success hinges on quantifiable reductions in improper payments, successful prosecution of fraudulent entities, and demonstrable cost savings achieved through enhanced program integrity. Key Performance Indicators (KPIs) should track the number of fraud cases identified and resolved, the value of funds recovered, and the efficiency gains in program administration. Regular audits and performance reviews are essential to ensure these metrics are met and the contract delivers its intended value.

How will the Cost Plus Award Fee structure be managed to prevent cost overruns while incentivizing effective performance?

Effective management of the Cost Plus Award Fee (CPAF) structure requires clear, objective performance standards and award criteria. The government must establish a robust baseline for allowable costs and rigorously track expenditures against this baseline. Award fees should be directly tied to measurable outcomes in fraud detection and prevention, ensuring that higher fees are only paid for exceptional performance. Regular audits and transparent reporting are crucial to maintain accountability and prevent potential cost creep.

What is the potential return on investment for taxpayers given the nearly $219 million contract value over 10 years?

The potential return on investment is significant if the contract effectively reduces fraud, waste, and abuse in the healthcare system. Every dollar spent on fraud detection can yield multiple dollars in recovered funds and prevented improper payments. However, the ROI is contingent on the contractor's performance and the government's oversight. A conservative estimate would require detailed data on historical fraud losses and projected savings from the implemented measures.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical 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: HHSM5002016RFP0028

Offers Received: 4

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 5400 LEGACY DR, 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: $219,079,652

Exercised Options: $219,079,652

Current Obligation: $219,079,652

Actual Outlays: $105,976,181

Subaward Activity

Number of Subawards: 51

Total Subaward Amount: $26,319,898

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: HHSM500201600083I

IDV Type: IDC

Timeline