HHS awards $158M contract for durable medical equipment appeals, with C2C Innovative Solutions Inc. as prime

Contract Overview

Contract Amount: $158,224,966 ($158.2M)

Contractor: C2C Innovative Solutions, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2011-09-01

End Date: 2020-02-28

Contract Duration: 3,102 days

Daily Burn Rate: $51.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: QUALIFIED INDEPENDENT CONTRACTOR DURABLE MEDICAL EQUIPMENT APPEALS WORKLOAD

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32202

State: Florida Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $158.2 million to C2C INNOVATIVE SOLUTIONS, INC. for work described as: QUALIFIED INDEPENDENT CONTRACTOR DURABLE MEDICAL EQUIPMENT APPEALS WORKLOAD Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract spans over 8 years, indicating a long-term need for these services. 3. The fixed-price nature of the contract aims to control costs for the government. 4. Services are focused on administrative management and consulting, supporting critical healthcare appeals. 5. The contract's value places it as a significant award within its service category. 6. Performance is geographically concentrated in Florida, potentially impacting regional service delivery.

Value Assessment

Rating: good

The contract's value of approximately $158 million over 8 years for DME appeals workload management appears reasonable given the duration and scope. Benchmarking against similar large-scale administrative support contracts for federal agencies suggests this pricing is within expected ranges. The firm-fixed-price structure provides cost certainty for the government, although the total value is an estimate based on anticipated workload.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of 3 bids suggests a moderate level of competition for this significant contract. While not an exhaustive number, it implies that multiple companies vied for the opportunity, which generally aids in price discovery and achieving a fair market price.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and better service quality compared to sole-source or limited competition scenarios.

Public Impact

Beneficiaries include Medicare beneficiaries who require appeals for durable medical equipment claims. Services delivered include administrative management and consulting to process and manage these appeals. The geographic impact is primarily focused on Florida, where the contractor is located and services are likely managed. Workforce implications include the creation of jobs within C2C Innovative Solutions, Inc. to support the contract's operational needs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 8 years) could lead to potential complacency or reduced innovation over time if not actively managed.
Geographic concentration in Florida might limit the ability to leverage broader talent pools or respond to national-level workload fluctuations efficiently.
Reliance on a single prime contractor for such a critical function could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a competitive process that should yield value.
Firm-fixed-price contract type provides cost predictability for the government.
The contractor, C2C Innovative Solutions, Inc., has secured a significant award, suggesting a level of established capability.
The contract addresses a specific and important function within the Centers for Medicare and Medicaid Services (CMS) operations.

Sector Analysis

This contract falls within the administrative management and general management consulting services sector, specifically supporting healthcare administration. The market for such services is substantial, driven by the complex needs of government agencies like CMS. Comparable spending benchmarks would involve analyzing other large contracts for claims processing, appeals management, and administrative support within federal health programs. The size of this award ($158M) indicates it is a significant contract within this niche.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications mandated by a small business set-aside. However, the prime contractor, C2C Innovative Solutions, Inc., may choose to subcontract portions of the work to small businesses as part of their business strategy, which could contribute to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Health and Human Services, specifically the Centers for Medicare and Medicaid Services (CMS). Accountability measures are embedded within the contract terms, including performance standards and reporting requirements. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Medicare Appeals
Durable Medical Equipment (DME) Claims
Administrative Management Services
Healthcare Consulting
CMS Operations Support

Risk Flags

Long-term contract duration
Potential for performance issues in appeals processing
Data security and privacy concerns
Reliance on a single prime contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $158.2 million to C2C INNOVATIVE SOLUTIONS, INC.. QUALIFIED INDEPENDENT CONTRACTOR DURABLE MEDICAL EQUIPMENT APPEALS WORKLOAD

Who is the contractor on this award?

The obligated recipient is C2C INNOVATIVE 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 $158.2 million.

What is the period of performance?

Start: 2011-09-01. End: 2020-02-28.

What is the historical spending trend for this specific contract or similar services by CMS?

Analyzing historical spending for this specific contract requires access to detailed contract modification data and previous award history. However, based on the start date of 2011 and end date of 2020, this represents a significant, long-term engagement. CMS consistently spends billions annually on administrative and operational support services. Spending on appeals processing, particularly for complex areas like Durable Medical Equipment (DME), can fluctuate based on policy changes, litigation, and beneficiary utilization. Without specific prior award data for this exact contract vehicle, it's difficult to establish a precise trend, but the $158M total award suggests a consistent annual expenditure averaging around $17-20 million over its lifespan, reflecting a substantial and ongoing need for these services within CMS's operational budget.

How does the contractor's past performance on similar contracts compare to the requirements of this award?

Assessing C2C Innovative Solutions, Inc.'s past performance requires a review of their contract history, including any past performance evaluations or awards from federal agencies. Information on specific past performance is often considered sensitive or proprietary and not always publicly available in detail. However, securing a contract of this magnitude ($158M) from the Department of Health and Human Services, particularly for a critical function like DME appeals, suggests that the agency found their past performance to be adequate or superior during the competitive evaluation process. Agencies typically consider factors such as technical execution, cost control, timeliness, and customer satisfaction when evaluating past performance. A lack of significant public protest or negative reporting related to this contract could also indirectly indicate satisfactory performance.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Key Performance Indicators (KPIs) for a contract managing Durable Medical Equipment (DME) appeals workload would likely focus on efficiency, accuracy, and timeliness. Specific KPIs could include: average processing time per appeal, appeal overturn rates (both by the contractor and subsequent higher levels), adherence to regulatory timelines for appeal decisions, accuracy of documentation and decision rationale, and overall workload completion rates against targets. The contract statement of work (SOW) would detail these specific metrics and their associated acceptable performance levels. CMS would monitor these KPIs to ensure C2C Innovative Solutions, Inc. is effectively managing the appeals process and meeting service level agreements, thereby ensuring fair and timely resolution for beneficiaries.

Are there any identified risks associated with the contractor or the nature of the services provided?

Potential risks associated with this contract could include: 1) **Performance Risk:** The contractor may fail to meet performance standards related to timeliness, accuracy, or volume of appeals processed, leading to backlogs and beneficiary dissatisfaction. 2) **Cost Risk:** Although a firm-fixed-price contract, scope creep or unforeseen complexities in appeals could strain resources or lead to requests for modification. 3) **Data Security Risk:** Handling sensitive beneficiary information requires robust cybersecurity measures; a breach could have severe consequences. 4) **Regulatory Change Risk:** Changes in healthcare policy or DME regulations could necessitate significant adjustments to the contractor's processes. 5) **Contractor Viability Risk:** Long-term contracts carry a risk of contractor financial instability or changes in business strategy impacting service delivery.

How does this contract align with the broader goals of the Centers for Medicare and Medicaid Services (CMS)?

This contract directly aligns with CMS's core mission to ensure effective health coverage for Medicare beneficiaries. Managing the appeals process for Durable Medical Equipment (DME) is crucial for ensuring that beneficiaries receive necessary equipment and that claims are adjudicated fairly and accurately according to program rules. Efficient and effective appeals processing helps maintain program integrity, control costs by preventing improper payments, and uphold beneficiary rights. By outsourcing the management of this workload, CMS can focus its internal resources on policy development, program oversight, and strategic initiatives, while ensuring a critical operational function is handled competently. The contract supports CMS's goal of providing efficient and equitable healthcare services.

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

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: TMF Health Quality Institute

Address: 532 RIVERSIDE AVE, JACKSONVILLE, FL, 32202

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

Financial Breakdown

Contract Ceiling: $158,224,966

Exercised Options: $158,224,966

Current Obligation: $158,224,966

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: HHSM500200400005I

IDV Type: IDC

Timeline