HHS awarded $19.7M for fitness services, with Millennium Health & Fitness Inc. as the sole contractor

Contract Overview

Contract Amount: $19,713,114 ($19.7M)

Contractor: Millennium Health & Fitness, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2015-11-01

End Date: 2018-10-31

Contract Duration: 1,095 days

Daily Burn Rate: $18.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: IGF::OT::IGF SUPPORT STAFF FOR WELLNESS AND HEALTH PROMOTION SERVICES

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20857

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $19.7 million to MILLENNIUM HEALTH & FITNESS, INC. for work described as: IGF::OT::IGF SUPPORT STAFF FOR WELLNESS AND HEALTH PROMOTION SERVICES Key points: 1. The contract value of $19.7 million over three years suggests a significant investment in employee wellness. 2. Sole-source award raises questions about competition and potential for overpayment. 3. The 'Fitness and Recreational Sports Centers' classification indicates a focus on physical health promotion. 4. The contract duration of 1095 days (3 years) provides a stable period for service delivery. 5. Awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES', the specific rationale for exclusion needs further review. 6. The Time and Materials pricing structure can pose risks if not closely managed. 7. The contract was awarded to a single entity, Millennium Health & Fitness, Inc.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more specific service details. However, a $19.7 million award for fitness and recreational services over three years represents a substantial expenditure. The sole-source nature of the award, despite being listed under 'full and open competition after exclusion of sources,' warrants scrutiny to ensure fair pricing and prevent potential overpayment compared to market rates for similar comprehensive wellness programs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which is an unusual designation. Typically, 'sole-source' implies no competition was sought. This specific phrasing suggests that while competition was initially considered, only one source was ultimately deemed viable or available. Further investigation into the justification for excluding other sources is necessary to understand the competitive landscape and its impact on price discovery.

Taxpayer Impact: The limited competition, even with the 'exclusion of sources' caveat, may have resulted in a higher price for taxpayers than if multiple vendors had actively bid on the contract.

Public Impact

Federal employees within the Department of Health and Human Services (HHS) are the primary beneficiaries, gaining access to fitness and recreational services. The services delivered likely include access to fitness facilities, group exercise classes, and potentially wellness coaching. The geographic impact is concentrated at the HHS facilities where these services are provided, likely within Maryland given the 'ST' code. Workforce implications include improved employee morale, health, and potentially reduced absenteeism due to enhanced wellness programs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation requires detailed justification to ensure no viable competitors were unfairly excluded.
The Time and Materials (T&M) contract type can lead to cost overruns if not meticulously monitored and controlled.
Lack of clear performance metrics or service level agreements in the provided data makes it difficult to assess the effectiveness and value for money.
The sole-source nature of the award, despite the competition description, raises concerns about the government's ability to secure the best possible price.

Positive Signals

The contract directly addresses employee wellness, which can lead to a healthier and more productive federal workforce.
A dedicated contract for fitness and recreational services indicates a commitment by HHS to employee well-being.
The three-year duration provides stability for service provision and employee engagement with the programs.

Sector Analysis

This contract falls within the broader Health and Wellness services sector, specifically focusing on fitness and recreational sports. The federal government, as a large employer, frequently contracts for employee wellness programs to promote health, reduce healthcare costs, and improve productivity. Comparable spending benchmarks would typically involve analyzing other government contracts for similar fitness center management or employee wellness initiatives, considering factors like facility size, scope of services, and geographic location.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a factor in this award. There is no indication of small business set-asides or subcontracting requirements. This means the contract did not actively aim to support the small business ecosystem and its full value was awarded to a large business.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services' Office of the Assistant Secretary for Administration (SA). Accountability measures would be defined in the contract's statement of work and performance standards. Transparency is facilitated through contract databases like FPDS, though detailed performance reports are often internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Employee Health and Wellness Programs
Government Employee Benefits Administration
Department of Health and Human Services Contracts
Fitness Center Management Contracts
Employee Assistance Programs

Risk Flags

Limited Competition
Time and Materials Pricing
Lack of Performance Data
Sole-Source Award Justification Needed

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $19.7 million to MILLENNIUM HEALTH & FITNESS, INC.. IGF::OT::IGF SUPPORT STAFF FOR WELLNESS AND HEALTH PROMOTION SERVICES

Who is the contractor on this award?

The obligated recipient is MILLENNIUM HEALTH & FITNESS, 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 $19.7 million.

What is the period of performance?

Start: 2015-11-01. End: 2018-10-31.

What specific services were included in the 'Fitness and Recreational Sports Centers' contract, and how were they measured for performance?

The provided data does not detail the specific services rendered under the 'Fitness and Recreational Sports Centers' contract (NA 713940). Typically, such contracts could encompass gym access, group fitness classes, personal training, wellness seminars, and potentially sports league management. Performance measurement would ideally be tied to metrics like facility utilization rates, participant satisfaction surveys, class attendance, and potentially health outcome improvements among participating employees. Without the Statement of Work (SOW) and performance reports, a precise assessment of service delivery and effectiveness is not possible. The Time and Materials (T&M) pricing structure suggests that costs were based on direct labor hours and materials used, necessitating robust oversight to ensure efficiency and prevent scope creep.

What was the justification for awarding this contract as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' to a single vendor?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' is unusual and implies a complex procurement history. It suggests that the agency initially intended to compete the contract broadly but, at some stage, determined that only one source was capable of meeting the requirements or that other sources were excluded for specific, documented reasons (e.g., lack of capability, proprietary technology, urgent need that only one could meet). To understand the rationale, one would need to review the Justification for Other Than Full and Open Competition (JOFOC) or similar documentation filed with the contract award. This documentation is critical for taxpayers to understand why competition was limited and if the government received fair value under these circumstances.

How does the $19.7 million contract value compare to similar federal contracts for employee wellness and fitness services?

Directly comparing the $19.7 million contract value for fitness and recreational services is difficult without knowing the exact scope, scale, and duration of services provided. However, this figure represents a significant investment over three years, averaging over $6.5 million annually. To benchmark effectively, one would need to analyze contracts for similar federal agencies or large private sector organizations providing comparable services (e.g., operating fitness centers, offering diverse wellness programs) in similar geographic regions. Factors such as the number of employees served, the breadth of facilities and equipment, and the types of programs offered (e.g., basic gym access vs. comprehensive health coaching) heavily influence cost. The sole-source nature of this award also complicates direct value comparisons, as competitive bidding often drives prices down.

What are the potential risks associated with the Time and Materials (T&M) contract type for these fitness services?

The Time and Materials (T&M) contract type, used here, carries inherent risks for the government. It means the contractor is reimbursed for the actual cost of labor hours and materials used, plus a fixed fee or fixed hourly rate. The primary risk is cost overrun, as there is less incentive for the contractor to control labor hours or material costs compared to a fixed-price contract. If not meticulously managed and monitored by the contracting officer and technical team, T&M contracts can become significantly more expensive than initially anticipated. Robust oversight, detailed timesheets, and clear definitions of billable hours and materials are crucial to mitigate these risks and ensure the government pays a fair price for the services rendered.

What is the track record of Millennium Health & Fitness, Inc. in performing government contracts, particularly for wellness and fitness services?

Information regarding Millennium Health & Fitness, Inc.'s specific track record with government contracts, especially within the wellness and fitness domain, is not detailed in the provided data. A comprehensive assessment would require reviewing their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), any past disputes or contract terminations, and the volume and type of federal contracts they have previously held. Understanding their history with similar service delivery, adherence to schedules, cost control, and overall client satisfaction is crucial for evaluating the reliability and value of this current award. Without access to these performance records, it's difficult to definitively assess their suitability beyond the fact they were awarded this contract.

What is the historical spending pattern for fitness and recreational services within HHS or similar agencies?

The provided data snippet focuses on a single contract award and does not offer historical spending patterns for fitness and recreational services within HHS or comparable agencies. To analyze historical spending, one would need to query federal procurement databases (like FPDS) for contracts categorized under 'Fitness and Recreational Sports Centers' (ND 18003) or similar service codes over several fiscal years. This analysis would reveal trends in contract values, the number of awards, dominant contractors, and fluctuations in spending. Understanding these patterns helps contextualize the $19.7 million award, identifying whether it represents an increase, decrease, or stable level of investment in employee wellness services over time.

Industry Classification

NAICS: Arts, Entertainment, and Recreation › Other Amusement and Recreation Industries › Fitness and Recreational Sports Centers

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 610 TIMEA ST, KEOKUK, IA, 52632

Business Categories: American Indian Owned Business, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Economically Disadvantaged Women Owned Small Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $19,713,114

Exercised Options: $19,713,114

Current Obligation: $19,713,114

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HHSP233201300013I

IDV Type: IDC

Timeline