HHS awarded $28.4M to MITRE for strategic planning of Medicare payment reforms

Contract Overview

Contract Amount: $28,398,587 ($28.4M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2015-09-18

End Date: 2019-09-17

Contract Duration: 1,460 days

Daily Burn Rate: $19.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Healthcare

Official Description: IGF::CT::IGF TASK ORDER ENTITLED,"STRATEGIC DESIGN AND IMPLEMENTATION PLANNING FOR THE MERIT-BASED INCENTIVE SYSTEM (MIPS) AND RELATED SECTIONS OF MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT".

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $28.4 million to THE MITRE CORPORATION for work described as: IGF::CT::IGF TASK ORDER ENTITLED,"STRATEGIC DESIGN AND IMPLEMENTATION PLANNING FOR THE MERIT-BASED INCENTIVE SYSTEM (MIPS) AND RELATED SECTIONS OF MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT". Key points: 1. Contract focused on implementing complex Medicare payment system changes. 2. MITRE Corporation, a federally funded research and development center (FFRDC), was the contractor. 3. The contract was awarded under full and open competition. 4. Performance period spanned nearly four years. 5. The contract type was Cost Plus Fixed Fee, indicating potential for cost overruns. 6. This award falls within professional, scientific, and technical services.

Value Assessment

Rating: good

The contract value of $28.4 million for nearly four years of strategic planning services appears reasonable given the complexity of Medicare payment reforms. Benchmarking against similar FFRDC contracts for policy development and implementation support suggests this is within expected ranges. The Cost Plus Fixed Fee structure, while common for complex, evolving projects, warrants scrutiny for cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting multiple vendors had the opportunity to bid. This competitive process is generally favorable for price discovery and ensuring the government receives competitive offers. The specific number of bidders is not provided, but the designation implies a robust competition.

Taxpayer Impact: Full and open competition helps ensure taxpayer dollars are used efficiently by fostering a competitive environment that drives down costs and improves service quality.

Public Impact

Beneficiaries include Medicare beneficiaries and healthcare providers impacted by new payment models. Services delivered included strategic design and implementation planning for MIPS and MACRA. Geographic impact is nationwide, affecting the US healthcare system. Workforce implications include potential changes for healthcare professionals and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can lead to higher costs if not managed tightly.
The complexity of MIPS and MACRA implementation presents inherent execution risks.

Positive Signals

Award to MITRE, an FFRDC, suggests access to specialized expertise and objective analysis.
Full and open competition indicates a potentially well-vetted and cost-effective solution.
The contract's focus on strategic planning for significant healthcare reform is a positive indicator of proactive government action.

Sector Analysis

This contract falls within the Professional, Scientific, and Technical Services sector, specifically under NAICS code 541990 (All Other Professional, Scientific, and Technical Services). This sector encompasses a wide range of advisory, research, and analytical services. Spending in this area is crucial for government agencies needing specialized expertise to navigate complex policy and regulatory environments, such as healthcare reform. Comparable spending benchmarks would involve looking at other large-scale policy implementation contracts within HHS and other agencies.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. As a large contract awarded to a major FFRDC, the direct impact on the small business ecosystem may be limited unless MITRE engages small businesses for specialized support or services.

Oversight & Accountability

Oversight would typically be provided by the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. As a task order under a larger contract vehicle, it likely falls under existing oversight frameworks. Transparency is generally maintained through contract databases, though specific performance metrics and IG involvement would depend on the nature of any issues that arose.

Related Government Programs

Medicare Access and CHIP Reauthorization Act (MACRA)
Merit-based Incentive Payment System (MIPS)
Centers for Medicare and Medicaid Services (CMS) initiatives
Healthcare payment reform programs

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Complexity of healthcare reform implementation presents inherent execution risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $28.4 million to THE MITRE CORPORATION. IGF::CT::IGF TASK ORDER ENTITLED,"STRATEGIC DESIGN AND IMPLEMENTATION PLANNING FOR THE MERIT-BASED INCENTIVE SYSTEM (MIPS) AND RELATED SECTIONS OF MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT".

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

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 $28.4 million.

What is the period of performance?

Start: 2015-09-18. End: 2019-09-17.

What is the track record of The MITRE Corporation in supporting federal healthcare initiatives?

The MITRE Corporation, as a federally funded research and development center (FFRDC), has a long-standing history of providing objective, data-driven analysis and technical support to various government agencies, including the Department of Health and Human Services (HHS). Their work often involves complex system design, policy analysis, and strategic planning, particularly in areas like healthcare IT, cybersecurity, and national security. For HHS, MITRE has been instrumental in analyzing and advising on the implementation of major healthcare reforms, including aspects of the Affordable Care Act and subsequent payment model changes. Their FFRDC status allows them to work on sensitive and complex issues with a high degree of trust and impartiality, often tackling challenges that require deep technical expertise and a broad understanding of government operations and stakeholder needs.

How does the $28.4 million contract value compare to similar strategic planning contracts for healthcare reform?

The $28.4 million contract value for nearly four years of strategic planning and implementation support for MIPS and MACRA appears to be within a reasonable range for large-scale federal healthcare reform initiatives. Contracts of this nature often involve extensive research, analysis, stakeholder engagement, and the development of complex implementation roadmaps. Similar engagements for major policy rollouts within HHS or other large agencies can range from tens to hundreds of millions of dollars, depending on the scope, duration, and the specific expertise required. Given that MITRE is an FFRDC, their rates might differ from traditional contractors, but the overall value reflects the significant undertaking of reforming Medicare payment systems, which impacts millions of beneficiaries and providers nationwide.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for this type of service?

A Cost Plus Fixed Fee (CPFF) contract, like the one awarded to MITRE, carries inherent risks, primarily related to cost control. In a CPFF structure, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. The main risk for the government is that the contractor may have less incentive to control costs compared to a fixed-price contract, as their fee is fixed regardless of the final cost. If costs escalate beyond initial projections, the government still pays the actual costs plus the fixed fee. This necessitates robust government oversight to monitor expenditures, ensure cost allowability, and manage the scope of work effectively to prevent cost overruns. For complex, evolving projects like healthcare reform implementation, CPFF can be appropriate to allow flexibility, but it requires diligent management.

What was the effectiveness of this contract in achieving its stated goals of MIPS and MACRA implementation planning?

Assessing the specific effectiveness of this contract requires detailed performance reviews and outcome data that are not publicly available in this summary. However, the contract's objective was strategic design and implementation planning, which are foundational steps. The success of these planning efforts would be measured by the clarity of the strategic roadmap developed, the identification of key challenges and mitigation strategies, and the extent to which the subsequent implementation phases (which occurred after this contract's period of performance) were informed and guided by this planning. MITRE's role as an FFRDC suggests a focus on providing objective, high-quality analysis, which is crucial for effective planning of such complex legislative mandates. The continued evolution and operation of MIPS and MACRA suggest that the planning facilitated by this contract was likely a valuable input.

How has federal spending on professional, scientific, and technical services for healthcare reform evolved over the past decade?

Federal spending on professional, scientific, and technical services for healthcare reform has seen significant increases, particularly following major legislative initiatives like the Affordable Care Act (ACA) and subsequent reforms such as MACRA. Agencies like HHS, CMS, and ONC consistently require external expertise for policy analysis, system design, data analytics, program evaluation, and implementation support. This spending reflects the complexity of the healthcare landscape, the need for specialized knowledge in areas like health IT interoperability, value-based care models, and regulatory compliance. While specific figures fluctuate annually based on legislative priorities and budget allocations, the trend indicates a sustained and substantial investment in external technical and analytical support to navigate and implement complex healthcare policies and programs.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFPCMS20110021

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 7515 COLSHIRE DR, MC LEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $28,398,587

Exercised Options: $28,398,587

Current Obligation: $28,398,587

Actual Outlays: $122,238

Subaward Activity

Number of Subawards: 38

Total Subaward Amount: $13,264,437

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HHSM500201200008I

IDV Type: IDC

Timeline