HHS Awards $92M for MAPD Systems Software Maintenance to CGI Federal Inc
Contract Overview
Contract Amount: $92,360,761 ($92.4M)
Contractor: CGI Federal Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2014-08-01
End Date: 2021-10-31
Contract Duration: 2,648 days
Daily Burn Rate: $34.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: COST PLUS AWARD FEE
Sector: IT
Official Description: IGF::OT::IGF MAPD SYSTEMS SOFTWARE MAINTENANCE SUPPORT
Place of Performance
Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $92.4 million to CGI FEDERAL INC. for work described as: IGF::OT::IGF MAPD SYSTEMS SOFTWARE MAINTENANCE SUPPORT Key points: 1. Significant contract value of $92.36 million over 6.7 years. 2. CGI Federal Inc. is the sole awardee, raising questions about competition. 3. The contract type (Cost Plus Award Fee) can lead to cost overruns. 4. The sector is IT services, specifically Computer Systems Design.
Value Assessment
Rating: fair
The Cost Plus Award Fee structure allows for costs plus a fee based on performance. Without detailed performance metrics and fee structures, it's difficult to assess if the pricing is truly competitive or incentivizes efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting multiple bids were considered. However, the specific award mechanism (Delivery Order) and the single awardee indicate a focused competition for this particular task order.
Taxpayer Impact: Taxpayer funds are being used for essential IT maintenance. The effectiveness of the competition and contract type will determine the ultimate value for money.
Public Impact
Ensures continued operation of critical Medicare systems. Potential for increased costs due to the award fee structure. Relies on a single vendor for essential software maintenance. Impacts beneficiaries through the stability of their healthcare access systems.
Waste & Efficiency Indicators
Waste Risk Score: 70 / 10
Warning Flags
- Cost Plus Award Fee structure may not optimize costs.
- Single awardee for this delivery order.
- Long contract duration increases long-term risk.
Positive Signals
- Awarded under full and open competition.
- Supports critical healthcare systems for Medicare beneficiaries.
Sector Analysis
This contract falls within the IT services sector, specifically Computer Systems Design. Spending benchmarks for similar large-scale software maintenance contracts vary widely based on system complexity and criticality.
Small Business Impact
The data indicates this contract was not set aside for small businesses and the awardee, CGI Federal Inc., is a large business. There is no indication of small business subcontracting in the provided data.
Oversight & Accountability
Oversight would typically involve regular performance reviews by CMS to ensure CGI Federal Inc. meets contract requirements and award fee criteria. The Inspector General's office may also conduct audits.
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 CPAF structure.
- Risk of vendor lock-in over the contract's long duration.
- Lack of small business participation evident in the data.
- Dependence on a single vendor for critical system maintenance.
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 $92.4 million to CGI FEDERAL INC.. IGF::OT::IGF MAPD SYSTEMS SOFTWARE MAINTENANCE SUPPORT
Who is the contractor on this award?
The obligated recipient is CGI FEDERAL 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 $92.4 million.
What is the period of performance?
Start: 2014-08-01. End: 2021-10-31.
What specific performance metrics are tied to the award fee, and how do they ensure value for money?
The effectiveness of the award fee structure hinges on clearly defined, measurable performance metrics that directly align with the agency's objectives for MAPD systems. Without insight into these metrics, it's challenging to ascertain if the fee truly incentivizes optimal performance and cost efficiency, or if it merely adds to the overall cost without a proportional increase in value.
What is the risk of vendor lock-in or decreased innovation given the long duration and single awardee for this task order?
A long contract duration (over 6 years) with a single awardee for critical software maintenance inherently carries a risk of vendor lock-in. This can stifle innovation as the vendor may face less pressure to introduce new efficiencies or technologies. The agency must actively manage the relationship and explore future competitive opportunities to mitigate this risk.
How does the Cost Plus Award Fee structure compare to fixed-price or other contract types in terms of cost control for IT maintenance?
Cost Plus Award Fee (CPAF) contracts offer flexibility but can be less predictable in terms of final cost compared to fixed-price contracts. While the award fee component aims to incentivize performance, it also allows costs to escalate beyond initial estimates. Fixed-price contracts generally offer better cost certainty, but may not be suitable for complex IT projects with evolving requirements.
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: 5
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: CGI Inc (UEI: 248513116)
Address: 12601 FAIR LAKES CIR, FAIRFAX, VA, 22033
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $99,022,682
Exercised Options: $92,360,761
Current Obligation: $92,360,761
Actual Outlays: $6,281,706
Subaward Activity
Number of Subawards: 10
Total Subaward Amount: $5,258,357
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: HHSM500200700015I
IDV Type: IDC
Timeline
Start Date: 2014-08-01
Current End Date: 2021-10-31
Potential End Date: 2022-01-31 00:00:00
Last Modified: 2021-08-17
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