DoD's $108M Delivery Order to United Concordia for Insurance Services Awarded in FY10, No Funds Obligated
Contract Overview
Contract Amount: $108,228,429 ($108.2M)
Contractor: United Concordia Companies, Inc.
Awarding Agency: Department of Defense
Start Date: 2009-09-22
End Date: 2010-01-31
Contract Duration: 131 days
Daily Burn Rate: $826.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIXED PRICE AWARD FEE
Sector: Healthcare
Official Description: OP-4, FY10 DELIVERY ORDER ISSUED SAF, NO FUNDS OBLIGATED.
Place of Performance
Location: HARRISBURG, DAUPHIN County, PENNSYLVANIA, 17110, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $108.2 million to UNITED CONCORDIA COMPANIES, INC. for work described as: OP-4, FY10 DELIVERY ORDER ISSUED SAF, NO FUNDS OBLIGATED. Key points: 1. The contract was awarded to United Concordia Companies, Inc. for Direct Health and Medical Insurance Carriers. 2. Awarded under full and open competition, indicating a competitive bidding process. 3. The contract type is Fixed Price Award Fee, with a duration of 131 days. 4. No funds were obligated at the time of the delivery order issuance, suggesting potential for cancellation or modification.
Value Assessment
Rating: questionable
The contract value is substantial at over $108 million. Without knowing the specific services rendered or the benchmark for similar insurance carrier contracts, it's difficult to definitively assess its value. The fact that no funds were obligated raises concerns about its ultimate realization.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, which typically promotes competitive pricing. However, the lack of obligated funds makes it hard to determine if the price discovery was effective or if the award was finalized.
Taxpayer Impact: The potential taxpayer impact is unclear due to no funds being obligated. If the contract is ultimately cancelled, there would be no direct cost. If it proceeds, the impact depends on the final negotiated terms and services.
Public Impact
Military personnel and their families may have been impacted by the health insurance services provided. The significant value suggests a large scope of coverage or a substantial number of beneficiaries. The administrative process for awarding and managing such a large contract involves significant government resources.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- No funds obligated at time of award
- Potential for contract cancellation
- Unclear final service delivery
Positive Signals
- Awarded under full and open competition
- Established carrier for health and medical insurance
Sector Analysis
This contract falls within the healthcare sector, specifically focusing on health and medical insurance carriers. Spending in this area is critical for supporting military personnel and their families. Benchmarks for similar contracts would depend on the specific services and population covered.
Small Business Impact
The contract was awarded to United Concordia Companies, Inc., a large corporation. There is no indication that small businesses were involved as subcontractors or prime contractors in this specific award.
Oversight & Accountability
Oversight would involve monitoring the performance of United Concordia, ensuring compliance with contract terms, and verifying the appropriate use of funds if they were eventually obligated. The lack of obligated funds might simplify immediate oversight but raises questions about the initial award process.
Related Government Programs
- Direct Health and Medical Insurance Carriers
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- No funds obligated
- Potential for cancellation
- Unclear service delivery
- Significant contract value without immediate commitment
Tags
direct-health-and-medical-insurance-carr, department-of-defense, pa, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $108.2 million to UNITED CONCORDIA COMPANIES, INC.. OP-4, FY10 DELIVERY ORDER ISSUED SAF, NO FUNDS OBLIGATED.
Who is the contractor on this award?
The obligated recipient is UNITED CONCORDIA COMPANIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $108.2 million.
What is the period of performance?
Start: 2009-09-22. End: 2010-01-31.
What was the intended scope of services for this $108M delivery order, and how does it compare to typical contracts for direct health and medical insurance carriers?
The intended scope of services for this delivery order was likely related to providing direct health and medical insurance coverage to a specific population, such as military personnel and their families. Without further details on the specific benefits package or the number of individuals covered, a direct comparison to typical contracts is challenging. However, the substantial value suggests a broad scope or a high-cost service offering.
What are the primary risks associated with a large delivery order where no funds were obligated at the time of issuance?
The primary risks include the potential for the order to be cancelled before any services are rendered or funds are expended, leading to wasted administrative effort. There's also a risk of delays if funding is eventually secured but not immediately available. Furthermore, it could indicate a lack of firm commitment or planning by the agency, potentially impacting the continuity of services for beneficiaries.
How effective was the full and open competition process in ensuring value for money, given that no funds were obligated?
The effectiveness of the full and open competition in ensuring value for money is difficult to ascertain when no funds were obligated. While the competition itself suggests an attempt to secure competitive pricing, the lack of commitment means the potential value may never be realized. The true measure of effectiveness would be if the contract proceeded to execution at a fair price, which is uncertain in this case.
Industry Classification
NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers
Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIXED PRICE AWARD FEE (M)
Evaluated Preference: NONE
Contractor Details
Parent Company: Highmark Inc (UEI: 067096644)
Address: 4401 DEER PATH ROAD, HARRISBURG, PA, 17110
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $108,228,429
Exercised Options: $108,228,429
Current Obligation: $108,228,429
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: H9400205D0001
IDV Type: IDC
Timeline
Start Date: 2009-09-22
Current End Date: 2010-01-31
Potential End Date: 2010-01-31 00:00:00
Last Modified: 2015-02-17
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