HHS Spends $76M on Computer Systems Design Services via Full and Open Competition
Contract Overview
Contract Amount: $76,201,255 ($76.2M)
Contractor: Optumserve Technology Services, Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2014-09-24
End Date: 2019-03-28
Contract Duration: 1,646 days
Daily Burn Rate: $46.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: IGF::CL::IGF
Place of Performance
Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $76.2 million to OPTUMSERVE TECHNOLOGY SERVICES, INC. for work described as: IGF::CL::IGF Key points: 1. Significant contract value of $76.2 million awarded. 2. Full and open competition was utilized, suggesting a robust market. 3. The contract spans nearly 5 years, indicating a long-term need. 4. The award was a delivery order under a larger contract. 5. No small business participation was noted.
Value Assessment
Rating: fair
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Benchmarking against similar contracts is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was employed, which typically fosters competitive pricing. However, the specific pricing structure (Cost Plus Fixed Fee) requires careful monitoring to ensure value for money.
Taxpayer Impact: Taxpayer funds were used in a competitive process, aiming for efficiency. The Cost Plus Fixed Fee structure warrants scrutiny to prevent excessive costs.
Public Impact
Impacts healthcare IT infrastructure and services managed by CMS. Ensures continued operation and development of critical health IT systems. Potential for improved healthcare delivery through technology enhancements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can incentivize higher costs.
- Lack of small business participation.
Positive Signals
- Full and open competition utilized.
- Long-term contract duration suggests sustained need.
Sector Analysis
This contract falls within the IT sector, specifically computer systems design services for healthcare. Spending in this area is substantial across government, driven by modernization and data management needs.
Small Business Impact
The data indicates no small business participation in this contract. Efforts to include small businesses in future solicitations or subcontracting opportunities could be explored.
Oversight & Accountability
The contract was awarded as a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. Oversight would focus on the management of this specific order and its alignment with the parent contract.
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 CPFF structure.
- Lack of small business involvement.
- Reliance on a single delivery order under a potentially larger contract.
- Long contract duration requires sustained oversight.
Tags
computer-systems-design-services, department-of-health-and-human-services, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $76.2 million to OPTUMSERVE TECHNOLOGY SERVICES, INC.. IGF::CL::IGF
Who is the contractor on this award?
The obligated recipient is OPTUMSERVE TECHNOLOGY SERVICES, 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 $76.2 million.
What is the period of performance?
Start: 2014-09-24. End: 2019-03-28.
What specific computer systems design services were procured, and how do they align with CMS's strategic IT goals?
The contract specifies 'Computer Systems Design Services' (NAICS 541512). These services likely encompass the design, development, integration, and maintenance of IT systems supporting Medicare and Medicaid operations. Alignment with CMS's goals would involve assessing if these services contribute to modernization efforts, data analytics capabilities, or improved beneficiary services.
What are the key performance indicators (KPIs) for this contract, and how is performance being measured to ensure value?
Key performance indicators would typically focus on system uptime, successful implementation of new features, adherence to security protocols, and timely delivery of services. Performance measurement would involve regular reviews, milestone tracking, and potentially user feedback to ensure the contractor meets contractual obligations and delivers the intended value within the agreed-upon cost structure.
Given the Cost Plus Fixed Fee structure, what mechanisms are in place to control costs and prevent scope creep?
Mechanisms to control costs and prevent scope creep in a CPFF contract include rigorous change control processes, detailed work breakdown structures, regular budget reviews, and clear definition of deliverables. The fixed fee component provides some incentive for the contractor to manage costs efficiently, but active government oversight and negotiation are crucial.
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: 4
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Unitedhealth Group Incorporated
Address: 10480 LITTLE PATUXENT PKWY SUITE 310, COLUMBIA, MD, 21044
Business Categories: 8(a) Program Participant, Category Business, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Indian (Subcontinent) American Owned Business
Financial Breakdown
Contract Ceiling: $79,387,924
Exercised Options: $76,201,255
Current Obligation: $76,201,255
Actual Outlays: $-318,375
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HHSM500200700024I
IDV Type: IDC
Timeline
Start Date: 2014-09-24
Current End Date: 2019-03-28
Potential End Date: 2019-03-28 00:00:00
Last Modified: 2024-09-18
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