HHS awarded Mathematica Inc. a $19.8M contract for administrative management consulting services

Contract Overview

Contract Amount: $19,872,640 ($19.9M)

Contractor: Mathematica Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2011-09-30

End Date: 2020-03-31

Contract Duration: 3,105 days

Daily Burn Rate: $6.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: PREP MULTI-COMPONENT EVALUATION

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $19.9 million to MATHEMATICA INC. for work described as: PREP MULTI-COMPONENT EVALUATION Key points: 1. The contract's value of $19.8 million over its nearly 8.5-year duration suggests a moderate annual spend. 2. Full and open competition was utilized, indicating a potentially robust bidding process. 3. The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns if not managed carefully. 4. The duration of the contract (over 8 years) is substantial, suggesting a long-term need for these services. 5. The North American Industry Classification System (NAICS) code 541611 points to general management consulting services. 6. The contract was awarded to a single entity, Mathematica Inc., for the entirety of its term.

Value Assessment

Rating: fair

Benchmarking the value of this $19.8 million contract over 3105 days (approximately 8.5 years) is challenging without specific deliverables or performance metrics. The annual average spend is roughly $2.3 million. Given the broad nature of administrative management and general management consulting services, this figure appears moderate. However, a true value assessment would require comparing the specific services rendered against industry standards and the contractor's performance history on similar engagements. The CPFF contract type introduces inherent risk regarding cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' suggesting that all responsible sources were permitted to submit bids. The data indicates there were 3 bids received. This level of competition is generally positive for price discovery, as it allows multiple firms to vie for the contract based on their proposed technical solutions and pricing. The presence of multiple bidders implies that the government had options and could select the best value proposition.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down prices and encouraging innovative solutions from contractors.

Public Impact

The primary beneficiaries are likely the administrative and management functions within the Department of Health and Human Services (HHS). The services delivered are expected to improve the efficiency and effectiveness of general management and administrative operations. The geographic impact is centered within the District of Columbia, where the agency is located. Workforce implications may include support for HHS staff in administrative roles and potential collaboration with Mathematica's consulting team.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Cost Plus Fixed Fee (CPFF) contract structure carries a risk of cost overruns if the contractor's actual costs exceed estimates, as the fixed fee remains constant.
The long duration of the contract (over 8 years) could lead to vendor lock-in and reduced flexibility for HHS to adapt to changing needs or explore alternative solutions.
Without specific performance metrics or deliverables detailed in the provided data, it's difficult to assess the contractor's performance or the true value received.
The reliance on a single contractor for such an extended period might limit opportunities for other firms to gain experience with HHS.

Positive Signals

The use of 'full and open competition' suggests a deliberate effort to ensure a fair and transparent procurement process, potentially leading to better pricing and solutions.
The receipt of 3 bids indicates that there was sufficient interest from the market, providing the agency with a choice.
Mathematica Inc. is a known entity in the research and consulting space, suggesting a degree of established capability.
The contract's objective of improving administrative management and general management consulting services is crucial for efficient government operations.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically administrative and management consulting. This is a broad category encompassing a wide range of services aimed at improving organizational efficiency and effectiveness. The market for these services is highly competitive, with numerous firms ranging from large, established consultancies to smaller, specialized boutiques. Government spending in this area is significant, as agencies frequently require external expertise to navigate complex administrative challenges, implement new policies, or optimize operations. Comparable spending benchmarks would depend heavily on the specific scope of work, but the annual spend of approximately $2.3 million for this contract is within a moderate range for long-term consulting engagements.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a small business set-aside. The focus of this contract is on administrative and management consulting services, which are often provided by larger, established firms. Opportunities for small businesses would typically arise through prime contracts awarded under different set-aside categories or through subcontracting opportunities with the prime contractor, Mathematica Inc., if they choose to engage small businesses.

Oversight & Accountability

Oversight for this contract would primarily reside within the Department of Health and Human Services (HHS), specifically the Office of the Assistant Secretary for Administration (OASA), which awarded the contract. As a Cost Plus Fixed Fee (CPFF) contract, rigorous financial oversight is crucial to monitor expenditures and ensure that costs are reasonable and allocable. Performance monitoring would involve tracking the contractor's adherence to the statement of work and the achievement of any defined objectives. Transparency would be facilitated through contract reporting requirements. While not explicitly stated, an Inspector General's office (e.g., HHS OIG) would likely have jurisdiction for audits and investigations related to potential fraud, waste, or abuse.

Related Government Programs

HHS Administrative Support Contracts
Management Consulting Services for Federal Agencies
Government-Wide Administrative Services Procurement
Cost-Plus Contract Management
Federal IT and Management Consulting

Risk Flags

Cost Plus Fixed Fee (CPFF) contract type may lead to cost overruns.
Long contract duration (over 8 years) could reduce flexibility.
Lack of specific performance metrics in provided data hinders value assessment.
Potential for vendor lock-in due to extended contract term.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $19.9 million to MATHEMATICA INC.. PREP MULTI-COMPONENT EVALUATION

Who is the contractor on this award?

The obligated recipient is MATHEMATICA INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of the Assistant Secretary for Administration).

What is the total obligated amount?

The obligated amount is $19.9 million.

What is the period of performance?

Start: 2011-09-30. End: 2020-03-31.

What is Mathematica Inc.'s track record with federal contracts, particularly within HHS?

Mathematica Inc. has a significant history of performing work for federal agencies, including the Department of Health and Human Services. While the provided data focuses on a single contract, a deeper analysis would involve reviewing their contract performance reports (e.g., Contractor Performance Assessment Reporting System - CPARS), past performance evaluations, and any documented issues or commendations. Their experience likely spans various domains, including health policy, program evaluation, and administrative support. Understanding their past performance on similar-sized and scoped contracts within HHS would provide crucial context for assessing the current contract's risk and potential for success. A review of their federal contract portfolio would reveal the breadth and depth of their government contracting experience.

How does the $19.8 million contract value compare to similar administrative management consulting contracts awarded by HHS or other federal agencies?

The $19.8 million total contract value, spread over approximately 8.5 years, equates to an average annual spend of roughly $2.3 million. This figure is moderate for long-term, comprehensive consulting services. To benchmark effectively, one would need to compare this against contracts with similar scopes of work (e.g., general management consulting, administrative process improvement) awarded by HHS or other large federal agencies. Factors such as the specific deliverables, the level of expertise required, and the duration of the contract significantly influence pricing. Without detailed statements of work for comparison, it's difficult to definitively state if this represents excellent, fair, or questionable value. However, the competitive bidding process suggests an effort to achieve fair market value.

What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type used for this award?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost overruns. In a CPFF arrangement, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. If the contractor's actual costs exceed the initial estimates, the government bears the burden of these increased costs, while the contractor's fee remains unchanged. This can incentivize contractors to be less cost-conscious than in fixed-price contracts. Effective oversight, robust cost accounting standards, and clear definitions of allowable costs are critical to mitigate this risk. Regular audits and performance reviews are essential to ensure that costs are reasonable and directly related to the contract's objectives.

How effective are the oversight mechanisms for CPFF contracts within HHS to ensure accountability and prevent waste?

HHS, like other federal agencies, employs various oversight mechanisms for Cost Plus Fixed Fee (CPFF) contracts to ensure accountability and prevent waste. These typically include contract officers' representatives (CORs) or contracting officer's technical representatives (COTRs) who monitor performance and deliverables, financial audits conducted by the agency or the HHS Office of Inspector General (OIG), and regular reporting requirements from the contractor. The effectiveness of these mechanisms hinges on the diligence of the oversight personnel, the clarity of the contract's statement of work, and the robustness of the agency's internal controls. For CPFF contracts, particular attention is paid to the allowability, allocability, and reasonableness of costs incurred. Strong communication channels between the agency and the contractor are also vital.

What is the historical spending pattern for administrative management and general management consulting services at HHS?

Analyzing historical spending patterns for administrative management and general management consulting services at HHS would require access to historical contract databases and budget data. This contract, awarded in late 2011 and ending in early 2020, represents a portion of HHS's expenditure in this category over that period. To understand the broader trend, one would need to examine total spending on similar NAICS codes (like 541611) across HHS over multiple fiscal years. This analysis could reveal whether spending has been increasing, decreasing, or remaining relatively stable, and identify major contractors or types of services that have received significant funding. Such a historical perspective is crucial for budget planning and identifying potential areas for cost savings or efficiency improvements.

What are the implications of a 3-bidder competition for a contract of this size and duration?

A competition with three bidders for a contract valued at $19.8 million over 8.5 years suggests a moderately competitive environment. While more bidders generally lead to greater price competition, three offers indicate that the market found the opportunity attractive enough for multiple firms to invest in preparing proposals. This number is often considered sufficient to provide a reasonable basis for award, allowing the agency to compare different approaches and pricing structures. However, it is less competitive than procurements attracting five or more bids, which might drive prices down further. The quality of the bidders and the specific requirements of the solicitation are also critical factors; three highly qualified bidders could yield better results than numerous less capable ones.

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: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Mathematica Inc (UEI: 154125140)

Address: 600 ALEXANDER PARK, PRINCETON, NJ, 08540

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $24,074,300

Exercised Options: $19,872,640

Current Obligation: $19,872,640

Actual Outlays: $536,602

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline