DoD's $475M MHS Genesis Stage 4 Contract Awarded to Leidos, Inc. for IT Services
Contract Overview
Contract Amount: $474,899,182 ($474.9M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-06-25
End Date: 2022-07-28
Contract Duration: 1,494 days
Daily Burn Rate: $317.9K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ENTERPRISE ACTIVITIES FOR MHS GENESIS STAGE 4, PROGRAM MANAGEMENT, SUSTAINMENT, REGIONAL TRAINERS, LICENSES, AND MAINTENANCE
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $474.9 million to LEIDOS, INC. for work described as: ENTERPRISE ACTIVITIES FOR MHS GENESIS STAGE 4, PROGRAM MANAGEMENT, SUSTAINMENT, REGIONAL TRAINERS, LICENSES, AND MAINTENANCE Key points: 1. Leidos, Inc. secured a significant contract for enterprise activities related to MHS Genesis. 2. The contract falls under Computer Systems Design Services, a competitive sector. 3. Potential risks include program execution and sustainment challenges for a large-scale IT system. 4. Spending benchmarks for similar IT modernization projects should be considered for value assessment.
Value Assessment
Rating: fair
The contract value of $474.9 million over approximately 4 years appears substantial. Benchmarking against similar large-scale IT system implementations within government or private sectors is crucial to determine if this pricing is competitive.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process. However, the specific impact of this competition on the final price requires further analysis of the bidding process and awarded value.
Taxpayer Impact: Taxpayer funds are being utilized for a critical healthcare IT system modernization. Ensuring value for money and efficient program execution is paramount to maximize the benefit of this investment.
Public Impact
Modernization of the Military Health System (MHS) impacts healthcare delivery for service members and their families. The success of MHS Genesis is crucial for improving healthcare data management and operational efficiency within the DoD. This significant IT investment has implications for cybersecurity and data privacy within a sensitive government system.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns in large IT programs
- Dependency on a single contractor for critical sustainment
- Integration challenges with existing DoD systems
Positive Signals
- Awarded through full and open competition
- Focus on critical healthcare IT infrastructure
- Long-term sustainment plan included
Sector Analysis
This contract falls within the IT services sector, specifically Computer Systems Design Services. Spending in this area is substantial across government, driven by modernization efforts and digital transformation initiatives. Benchmarks for similar large-scale system implementations are essential for evaluating cost-effectiveness.
Small Business Impact
The data indicates that small businesses were not directly awarded this prime contract, as Leidos, Inc. is a large business. Further analysis would be needed to determine if small businesses are participating as subcontractors.
Oversight & Accountability
Oversight will be critical to ensure the successful implementation and sustainment of MHS Genesis Stage 4. The Department of Defense and the Defense Health Agency will need robust program management and contract oversight mechanisms to monitor performance, manage risks, and ensure accountability.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Large contract value increases financial risk
- Complexity of IT system implementation
- Potential for scope creep
- Dependence on contractor for critical services
Tags
computer-systems-design-services, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $474.9 million to LEIDOS, INC.. ENTERPRISE ACTIVITIES FOR MHS GENESIS STAGE 4, PROGRAM MANAGEMENT, SUSTAINMENT, REGIONAL TRAINERS, LICENSES, AND MAINTENANCE
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $474.9 million.
What is the period of performance?
Start: 2018-06-25. End: 2022-07-28.
What is the projected return on investment for the MHS Genesis program, considering the total lifecycle costs?
The projected return on investment for the MHS Genesis program is difficult to quantify without specific ROI metrics defined by the DoD. However, the program aims to improve healthcare efficiency, reduce administrative burdens, and enhance data interoperability, which are expected to yield long-term cost savings and improved patient care. A comprehensive lifecycle cost analysis, including initial implementation, sustainment, and potential upgrades, is necessary to fully assess the financial benefits against the substantial investment.
What are the primary risks associated with the sustainment phase of MHS Genesis, and what mitigation strategies are in place?
Primary risks in the sustainment phase include technological obsolescence, cybersecurity threats, contractor performance issues, and user adoption challenges. Mitigation strategies likely involve robust cybersecurity protocols, regular system updates and patching, performance-based contract incentives for Leidos, Inc., and ongoing user training and support. The Defense Health Agency's oversight will be crucial in monitoring these risks and ensuring mitigation plans are effectively implemented.
How does the implementation of MHS Genesis Stage 4 contribute to the overall effectiveness of military healthcare delivery?
MHS Genesis Stage 4's implementation is intended to significantly enhance the effectiveness of military healthcare delivery by providing a unified electronic health record across the Military Health System. This integration aims to improve patient safety through better data accessibility, streamline clinical workflows, reduce medical errors, and enable more efficient data analysis for public health and readiness reporting. Ultimately, it supports better-informed decision-making and improved care coordination for service members.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 1750 PRESIDENTS ST, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $476,907,312
Exercised Options: $476,907,312
Current Obligation: $474,899,182
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $24,973,609
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0003915D0044
IDV Type: IDC
Timeline
Start Date: 2018-06-25
Current End Date: 2022-07-28
Potential End Date: 2022-07-28 00:00:00
Last Modified: 2024-09-03
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