DoD's $77M Magellan Federal Contract for Recovery Care Management Lacks Competition
Contract Overview
Contract Amount: $77,047,099 ($77.0M)
Contractor: Magellan Federal, Inc.
Awarding Agency: Department of Defense
Start Date: 2019-01-15
End Date: 2023-05-16
Contract Duration: 1,582 days
Daily Burn Rate: $48.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: RECOVERY CARE PROGRAM MANAGEMENT SUPPORT
Place of Performance
Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $77.0 million to MAGELLAN FEDERAL, INC. for work described as: RECOVERY CARE PROGRAM MANAGEMENT SUPPORT Key points: 1. Significant spending on administrative management and general management consulting services. 2. Contract awarded to Magellan Federal, Inc. with no indication of competition. 3. Potential risk associated with a lack of competitive bidding impacting price discovery. 4. The IT sector is not directly applicable, but management consulting is a broad service area.
Value Assessment
Rating: questionable
The contract value of $77 million over approximately 4 years is substantial. Without competitive data, it's difficult to benchmark pricing effectively against similar management consulting services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as competitive pressures are absent.
Taxpayer Impact: The lack of competition raises concerns about whether the government achieved the best possible price for these essential recovery care management services.
Public Impact
Taxpayers may be overpaying for management consulting services due to the absence of competitive bidding. The Defense Health Agency relies on this contract for critical recovery care program management. Lack of transparency in the procurement process could indicate potential inefficiencies or missed savings opportunities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Sole-Source Award
- Potential for Overpricing
Positive Signals
- Contract Awarded
- Services Delivered
Sector Analysis
This contract falls under administrative management and general management consulting services, a broad category often utilized across government agencies. Benchmarking requires comparison to similar consulting contracts, which is difficult without competitive data.
Small Business Impact
There is no information provided regarding the involvement of small businesses in this contract, suggesting it may not have been structured to encourage small business participation.
Oversight & Accountability
The 'NOT COMPETED' status indicates a lack of competitive oversight in the initial award. Further oversight would be needed to ensure the continued necessity and fair pricing of this sole-source contract.
Related Government Programs
- Administrative Management and General Management Consulting Services
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Lack of Competition
- Sole-Source Award
- Potential for Inflated Pricing
- Limited Transparency
- No Small Business Set-Aside Indicated
Tags
administrative-management-and-general-ma, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $77.0 million to MAGELLAN FEDERAL, INC.. RECOVERY CARE PROGRAM MANAGEMENT SUPPORT
Who is the contractor on this award?
The obligated recipient is MAGELLAN FEDERAL, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $77.0 million.
What is the period of performance?
Start: 2019-01-15. End: 2023-05-16.
What was the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves specific circumstances such as the urgency of the requirement, the unavailability of other sources, or the existence of unique capabilities possessed by the awarded contractor. Without the specific justification documentation, it is impossible to determine the precise reasons behind this decision and assess its validity.
What is the estimated cost savings if this contract had been competed?
Estimating cost savings from a non-competed contract is challenging without detailed market research and a competitive bidding process. However, studies consistently show that competitive procurements can yield significant savings, often in the range of 10-30% or more, compared to sole-source awards, due to the pressure on contractors to offer their best prices.
How is the performance of Magellan Federal, Inc. being monitored to ensure effective service delivery?
Performance monitoring for sole-source contracts is crucial to ensure value for money. The Defense Health Agency should have established performance metrics and regular reviews to assess Magellan Federal's adherence to contract requirements, quality of services, and overall effectiveness in managing the recovery care program.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HT001119R0010
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Magellan Federal Inc.
Address: 2800 S SHIRLINGTON RD STE 350, ARLINGTON, VA, 22206
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $82,688,351
Exercised Options: $77,047,099
Current Obligation: $77,047,099
Actual Outlays: $7,512,106
Subaward Activity
Number of Subawards: 35
Total Subaward Amount: $43,311,288
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2019-01-15
Current End Date: 2023-05-16
Potential End Date: 2023-07-16 00:00:00
Last Modified: 2024-07-11
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