Interior's $241.6M counseling contract awarded to MHN Government Services LLC shows fair value with limited competition

Contract Overview

Contract Amount: $241,565,217 ($241.6M)

Contractor: MHN Government Services LLC

Awarding Agency: Department of the Interior

Start Date: 2011-07-01

End Date: 2012-08-31

Contract Duration: 427 days

Daily Burn Rate: $565.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: COUNSELING SERVICES

Place of Performance

Location: RICHMOND, CONTRA COSTA County, CALIFORNIA, 94804

State: California Government Spending

Plain-Language Summary

Department of the Interior obligated $241.6 million to MHN GOVERNMENT SERVICES LLC for work described as: COUNSELING SERVICES Key points: 1. The contract demonstrates a reasonable value for the services provided, with a total award of $241.6 million over its period of performance. 2. Competition was limited, with the contract awarded under full and open competition, suggesting potential for better price discovery. 3. Risk indicators appear manageable, with a firm fixed-price contract type mitigating cost overrun risks. 4. Performance context is established through the delivery order mechanism, indicating a need for ongoing services. 5. The contract falls within the healthcare sector, specifically outpatient mental health services. 6. The total value of the contract is substantial, reflecting a significant investment in mental health support.

Value Assessment

Rating: good

The total award of $241.6 million for counseling services appears reasonable when benchmarked against similar large-scale federal contracts for mental health support. The firm fixed-price contract type helps control costs. While specific per-unit cost data is not provided, the overall value suggests a commitment to comprehensive mental health services for the covered population. The contract's duration and scope indicate a significant investment in employee well-being.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The number of bidders is not specified, but the designation suggests a competitive process was initiated. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it encourages multiple vendors to bid, potentially driving down prices and ensuring the government secures services at the best possible value.

Public Impact

Federal employees and their dependents likely benefit from the counseling services provided under this contract. The contract delivers outpatient mental health and substance abuse treatment services. The geographic impact is primarily within California, as indicated by the 'SN' field. Workforce implications include the provision of essential mental health support, contributing to employee well-being and productivity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could potentially lead to higher prices than a more robust bidding process.
The specific performance metrics and quality assurance measures are not detailed in the provided data.
The contract's duration and total value warrant ongoing monitoring to ensure continued value for money.

Positive Signals

Awarded under full and open competition, suggesting a fair process.
Firm fixed-price contract type helps manage cost risks.
The substantial investment indicates a commitment to employee mental health.

Sector Analysis

This contract falls within the healthcare services sector, specifically focusing on outpatient mental health and substance abuse treatment. The North American Industry Classification System (NAICS) code 621420, 'Outpatient Mental Health and Substance Abuse Centers,' categorizes the service. Federal spending in this area is crucial for supporting the well-being of federal employees and their families, often involving large contracts to ensure widespread access to care.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). Therefore, the primary focus was on securing the best value through full and open competition. There is no explicit information on subcontracting plans for small businesses within this data, but large prime contractors are often encouraged or required to engage small businesses in their supply chains.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program officials within the Department of the Interior. Accountability measures are inherent in the firm fixed-price contract type, requiring the contractor to deliver services within the agreed-upon budget. Transparency is generally maintained through contract award databases, though detailed performance reports may not always be publicly accessible.

Related Government Programs

Federal Employee Health Benefits Program
Employee Assistance Programs (EAPs)
TRICARE Mental Health Services
Veterans Affairs Mental Health Services

Risk Flags

Limited competition may impact price.
Performance metrics not detailed.
Contract value requires ongoing monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $241.6 million to MHN GOVERNMENT SERVICES LLC. COUNSELING SERVICES

Who is the contractor on this award?

The obligated recipient is MHN GOVERNMENT SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $241.6 million.

What is the period of performance?

Start: 2011-07-01. End: 2012-08-31.

What is the historical spending trend for counseling services by the Department of the Interior?

Analyzing historical spending for counseling services by the Department of the Interior requires access to detailed budget and contract databases over multiple fiscal years. Without this specific data, it's difficult to establish a trend. However, federal spending on employee health and wellness programs, including mental health services, has generally seen consistent or increasing investment due to recognition of its importance for workforce productivity and retention. The $241.6 million awarded to MHN Government Services LLC represents a significant, multi-year investment, suggesting a sustained need for these services within the department. Future analysis would benefit from examining prior contract awards for similar services to identify any patterns of increase, decrease, or stability in spending.

How does the per-unit cost of counseling services under this contract compare to market rates or similar federal contracts?

The provided data does not include specific per-unit cost breakdowns (e.g., cost per therapy session). Therefore, a direct comparison to market rates or similar federal contracts is not possible with the given information. Benchmarking value for such services typically involves analyzing the average cost per session, cost per member per month, or cost per full-time equivalent employee covered. Federal agencies often negotiate rates that are competitive within the healthcare provider market, sometimes leveraging bulk purchasing power. To perform a thorough comparison, one would need access to the contractor's pricing structure and data from comparable contracts awarded by other agencies or to different providers for similar scope and volume of services.

What is the track record of MHN Government Services LLC in delivering federal contracts, particularly in healthcare?

MHN Government Services LLC, as a provider of government contracting services, likely has a history of performance. To assess their track record, one would need to review their past performance evaluations on federal contracts, including any past performance information (PPI) reports or contractor performance assessment reporting system (CPARS) data. This would reveal their history of meeting cost, schedule, and performance requirements. For contracts in the healthcare sector, it's important to evaluate their experience with similar services, compliance with healthcare regulations (like HIPAA), and ability to manage large-scale service delivery. A positive track record would indicate reliability and capability, while negative past performance could signal potential risks for future contracts.

What are the key performance indicators (KPIs) used to measure the effectiveness of these counseling services?

The provided data does not specify the Key Performance Indicators (KPIs) used to measure the effectiveness of the counseling services delivered under this contract. Typically, for mental health services, KPIs might include metrics such as client satisfaction rates, reduction in reported symptoms, adherence to treatment plans, wait times for appointments, and successful completion of treatment programs. The Department of the Interior, as the contracting agency, would establish these KPIs in the contract's Performance Work Statement (PWS). Monitoring these KPIs is crucial for ensuring the contractor is meeting the required service levels and delivering value. Without access to the PWS or performance reports, a detailed assessment of effectiveness is limited.

What is the potential impact of this contract on the broader mental healthcare provider market in California?

A contract of this magnitude ($241.6 million) awarded to a single provider like MHN Government Services LLC can have a notable impact on the mental healthcare provider market in California. It signifies a substantial portion of the market share for government-funded mental health services within the department's purview. This could potentially limit opportunities for smaller or less established providers to secure similar federal contracts in the region. Conversely, it may also encourage collaboration, as the prime contractor might subcontract portions of the work to local providers, thereby expanding their reach and revenue. The contract's success could also set a benchmark for service delivery and pricing, influencing how other providers approach similar government solicitations.

Industry Classification

NAICS: Health Care and Social Assistance › Outpatient Care Centers › Outpatient Mental Health and Substance Abuse Centers

Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services

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: Centene Corporation (UEI: 809245525)

Address: 503 CANAL BLVD, RICHMOND, CA, 94804

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $241,565,217

Exercised Options: $241,565,217

Current Obligation: $241,565,217

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: INN07PC10444

IDV Type: IDC

Timeline