HHS Awards $232M to General Dynamics for Medicare Secondary Payer Systems
Contract Overview
Contract Amount: $232,205,126 ($232.2M)
Contractor: General Dynamics Information Technology, Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2012-06-12
End Date: 2020-01-12
Contract Duration: 2,770 days
Daily Burn Rate: $83.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS AWARD FEE
Sector: IT
Official Description: IGF::OT::IGF - MEDICARE SECONDARY PAYER SYSTEMS CONTRACTOR
Place of Performance
Location: TOWSON, BALTIMORE County, MARYLAND, 21204
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $232.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF - MEDICARE SECONDARY PAYER SYSTEMS CONTRACTOR Key points: 1. Contract value of $232.2M over 8 years. 2. General Dynamics Information Technology, Inc. is the sole awardee. 3. Risk of vendor lock-in due to sole-source nature. 4. IT sector contract for computer systems design services.
Value Assessment
Rating: good
The contract type is Cost Plus Award Fee, which allows for performance-based incentives. The total award value is substantial, but without specific cost breakdowns or benchmarks for similar IT systems design contracts, a precise value assessment is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under a limited competition, specifically as a delivery order. This suggests that the initial contract vehicle may have been competed, but the specific award to General Dynamics might not have undergone full and open competition, potentially impacting price discovery.
Taxpayer Impact: Taxpayer funds are being used for critical IT infrastructure supporting Medicare. The effectiveness of the spending hinges on the successful delivery of services and system improvements.
Public Impact
Ensures continued operation and improvement of the Medicare Secondary Payer system. Supports the integrity of Medicare by identifying other insurance coverage. Impacts beneficiaries by ensuring accurate billing and coordination of benefits.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Cost Plus Award Fee contract type
- Long contract duration
Positive Signals
- Supports critical healthcare infrastructure
- Potential for performance-based incentives
Sector Analysis
This contract falls within the Information Technology sector, specifically Computer Systems Design Services. Spending in this area is crucial for modernizing government operations and managing complex data systems like those for Medicare.
Small Business Impact
The data indicates that small businesses were not directly involved in this specific award, as General Dynamics Information Technology, Inc. is a large business. There is no information provided on subcontracting opportunities for small businesses.
Oversight & Accountability
Oversight is provided by the Centers for Medicare and Medicaid Services (CMS). The Cost Plus Award Fee structure implies performance monitoring to determine award fees, but further details on specific oversight mechanisms are not available.
Related Government Programs
- Computer Systems Design Services
- Department of Health and Human Services Contracting
- Centers for Medicare and Medicaid Services Programs
Risk Flags
- Potential for cost overruns due to Cost Plus Award Fee structure.
- Lack of full and open competition may limit price competitiveness.
- Long contract duration increases risk of scope creep or obsolescence.
- Dependence on a single large contractor for critical IT systems.
Tags
computer-systems-design-services, department-of-health-and-human-services, md, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $232.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF - MEDICARE SECONDARY PAYER SYSTEMS CONTRACTOR
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, 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 $232.2 million.
What is the period of performance?
Start: 2012-06-12. End: 2020-01-12.
What is the specific performance criteria used to determine award fees for General Dynamics?
The specific performance criteria for award fees are not detailed in the provided data. Typically, Cost Plus Award Fee contracts link incentives to measurable performance objectives, such as system uptime, efficiency improvements, adherence to deadlines, and user satisfaction. CMS would have established these metrics based on the contract's statement of work and the criticality of the Medicare Secondary Payer systems.
How does the limited competition impact the overall value for taxpayers?
Limited competition can potentially lead to higher costs for taxpayers compared to full and open competition, as it reduces the number of bidders and the competitive pressure on pricing. While the initial contract vehicle might have been competed, the specific award to General Dynamics may not have benefited from the broadest possible market engagement, potentially affecting price discovery and overall cost-effectiveness.
What are the key performance indicators (KPIs) for the Medicare Secondary Payer Systems Contractor?
Key performance indicators would likely focus on the accuracy and efficiency of identifying other insurance coverage for Medicare beneficiaries, the timeliness of system updates and maintenance, the security of sensitive data, and the overall reliability of the system. CMS would define these KPIs to ensure the contractor effectively supports the program's goals and minimizes improper payments.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Wico Limited
Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $233,405,128
Exercised Options: $233,405,128
Current Obligation: $232,205,126
Actual Outlays: $-364,436
Subaward Activity
Number of Subawards: 12
Total Subaward Amount: $71,050,727
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: HHSM500200700021I
IDV Type: IDC
Timeline
Start Date: 2012-06-12
Current End Date: 2020-01-12
Potential End Date: 2020-01-12 00:00:00
Last Modified: 2025-05-15
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