DoD awards $18.6M for virtual health program management, technical, and administrative support to Cherokee Nation System Solutions

Contract Overview

Contract Amount: $18,628,487 ($18.6M)

Contractor: Cherokee Nation System Solutions LLC

Awarding Agency: Department of Defense

Start Date: 2023-10-30

End Date: 2026-04-29

Contract Duration: 912 days

Daily Burn Rate: $20.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MILITARY HEALTH SYSTEM VIRTUAL HEALTH PROGRAM MANAGEMENT, TECHNICAL AND ADMINISTRATIVE SUPPORT SERVICES

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92134

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $18.6 million to CHEROKEE NATION SYSTEM SOLUTIONS LLC for work described as: MILITARY HEALTH SYSTEM VIRTUAL HEALTH PROGRAM MANAGEMENT, TECHNICAL AND ADMINISTRATIVE SUPPORT SERVICES Key points: 1. Contract awarded as sole-source, raising questions about potential cost savings from competition. 2. The contract's fixed-price nature aims to control costs, but requires careful monitoring of scope creep. 3. Performance period of 912 days provides a stable foundation for virtual health program development. 4. The award to a single entity may limit opportunities for diverse technological solutions. 5. Focus on virtual health aligns with modernizing military healthcare delivery. 6. The contract's value is moderate within the broader IT services sector for defense.

Value Assessment

Rating: fair

The contract value of $18.6 million over approximately 2.5 years for virtual health program management and support appears within a reasonable range for specialized IT services. However, without a competitive bidding process, it is difficult to benchmark the pricing against market rates or identify potential cost savings. The fixed-price contract type suggests an attempt to control costs, but the absence of comparative bids makes a definitive value-for-money assessment challenging. Further analysis would require understanding the specific deliverables and comparing them to similar sole-source awards.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. The justification for this approach is not provided in the data, but typically sole-source awards are made when only one vendor possesses the unique capabilities or resources required for the service. This lack of competition means that the government did not benefit from the price discovery and innovation that typically arises from multiple bidders vying for a contract. It also limits the opportunity to assess the market's capacity and pricing for these specific services.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as the government may not secure the most competitive pricing. It also reduces transparency in the procurement process.

Public Impact

Benefits military personnel and their families by enhancing virtual healthcare access and services. Delivers essential program management, technical, and administrative support for the Military Health System's virtual health initiatives. Geographic impact is nationwide, supporting virtual health services across various military installations. Workforce implications include potential reliance on the contractor's specialized IT and program management expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs for taxpayers.
Sole-source award limits opportunities for small businesses to participate.
Potential for vendor lock-in due to specialized nature of services.

Positive Signals

Fixed-price contract type helps to control costs and manage budget.
Award to an established entity may ensure continuity of critical virtual health services.
Focus on virtual health aligns with modernization efforts in military healthcare.

Sector Analysis

This contract falls within the broader Information Technology (IT) services sector, specifically focusing on healthcare IT solutions. The market for IT support services within the federal government, particularly for defense and healthcare agencies, is substantial. Comparable spending benchmarks would involve analyzing other contracts for program management, technical support, and administrative services within the Defense Health Agency and similar federal health organizations. The trend towards virtual health solutions is a significant growth area within this sector.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. As a sole-source award, it inherently limits opportunities for small businesses to compete directly for the prime contract. The impact on the small business ecosystem is likely minimal in terms of direct prime contract awards, but there could be indirect opportunities if the prime contractor engages small businesses for subcontracting, though this is not specified.

Oversight & Accountability

Oversight for this contract would primarily fall under the Defense Health Agency (DHA) and potentially the Department of Defense's Inspector General. Mechanisms likely include regular performance reviews, milestone tracking, and financial audits. Transparency is dependent on the agency's reporting practices for sole-source contracts. The effectiveness of oversight will hinge on the DHA's ability to monitor contractor performance against contract requirements and ensure that the services delivered meet the needs of the virtual health program.

Related Government Programs

Military Health System IT Support
Virtual Health Services Contracts
Defense Health Agency Program Management
Federal Healthcare IT Services
IT Services for Department of Defense

Risk Flags

Sole-source award lacks competitive pricing.
Potential for scope creep in 'Other Computer Related Services'.
Limited transparency on contractor's past performance.
No explicit small business subcontracting requirements identified.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.6 million to CHEROKEE NATION SYSTEM SOLUTIONS LLC. MILITARY HEALTH SYSTEM VIRTUAL HEALTH PROGRAM MANAGEMENT, TECHNICAL AND ADMINISTRATIVE SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is CHEROKEE NATION SYSTEM SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Health Agency).

What is the total obligated amount?

The obligated amount is $18.6 million.

What is the period of performance?

Start: 2023-10-30. End: 2026-04-29.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when a unique capability is required, only one vendor can provide the service, or in emergency situations. For IT services like virtual health program management, justifications often cite proprietary technology, specialized expertise, or the need for seamless integration with existing systems that only one contractor can provide. Without the official justification (e.g., FAR 6.302), it's impossible to definitively assess the necessity of bypassing full and open competition. This lack of transparency can raise concerns about whether competition was truly not feasible or if it was simply deemed less efficient.

How does the contractor's past performance on similar contracts inform this award?

The provided data does not detail the past performance of Cherokee Nation System Solutions LLC on similar contracts. A thorough assessment would require reviewing performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) for previous contracts held by this company, particularly those involving virtual health programs, IT management, or administrative support for federal agencies. Positive past performance is a key indicator of a contractor's ability to successfully execute current requirements. Conversely, a history of poor performance could signal increased risk for this contract, even if the award was sole-source. The absence of this information limits the ability to gauge the reliability of the selected contractor.

What are the key performance indicators (KPIs) and service level agreements (SLAs) for this contract?

The provided data does not specify the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. These are critical components that define the expected quality, timeliness, and effectiveness of the services to be delivered. For a virtual health program management contract, KPIs might include system uptime, response times for technical support, successful implementation of new virtual health features, and user satisfaction rates. SLAs would outline the specific metrics and remedies for non-performance. Without these details, it is difficult to objectively measure the contractor's performance and ensure the government is receiving adequate value for the $18.6 million investment.

What is the projected impact of this contract on the Military Health System's virtual health capabilities?

This contract is intended to provide crucial program management, technical, and administrative support, which is expected to enhance and sustain the Military Health System's (MHS) virtual health capabilities. By ensuring effective management and technical oversight, the contract aims to improve the reliability, accessibility, and functionality of virtual health services for military personnel and their families. This support is vital for the continued development and operation of telehealth platforms, remote patient monitoring, and other digital health solutions, ultimately contributing to modernized healthcare delivery within the MHS.

Are there any specific risks associated with the 'Other Computer Related Services' NAICS code for this contract?

The NAICS code 541519, 'Other Computer Related Services,' is broad and can encompass a wide range of IT activities. Risks associated with this code often stem from the potential for unclear scope definition, rapid technological obsolescence, and challenges in finding personnel with highly specialized skills. For this specific contract supporting virtual health, risks could include ensuring the security and privacy of sensitive health data, integrating diverse IT systems, and adapting to evolving telehealth technologies. The sole-source nature of the award, without a detailed breakdown of services under this NAICS code, increases the risk that the scope may not be fully understood or that the contractor's capabilities might not perfectly align with all nuanced requirements.

How does this contract's value compare to historical spending on similar virtual health support services within the DoD?

The provided data does not offer historical spending figures for similar virtual health support services within the Department of Defense (DoD), making a direct comparison difficult. To assess this, one would need to analyze past contracts awarded by the Defense Health Agency or other DoD components for virtual health program management, technical support, and administrative services. Factors such as contract duration, scope of work, and number of users supported would need to be considered for a meaningful comparison. The $18.6 million value over approximately 2.5 years represents a significant investment, and understanding its context within historical spending patterns is crucial for evaluating its reasonableness and potential value for money.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HT940823R0015

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2 W 2ND ST STE 1500-32, TULSA, OK, 74103

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,843,397

Exercised Options: $18,628,487

Current Obligation: $18,628,487

Actual Outlays: $2,480,469

Subaward Activity

Number of Subawards: 5

Total Subaward Amount: $6,351,815

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline