Department of Labor awards $7.2M contract for medical bill processing to Acentra Health LLC

Contract Overview

Contract Amount: $7,192,924 ($7.2M)

Contractor: Acentra Health LLC

Awarding Agency: Department of Labor

Start Date: 2025-07-01

End Date: 2026-06-30

Contract Duration: 364 days

Daily Burn Rate: $19.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: BRIDGE CONTRACT FOR MEDICAL BILL PROCESSING SERVICES

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Labor obligated $7.2 million to ACENTRA HEALTH LLC for work described as: BRIDGE CONTRACT FOR MEDICAL BILL PROCESSING SERVICES Key points: 1. Contract awarded on a firm-fixed-price basis, indicating predictable costs for the government. 2. The contract is for medical bill processing services, a critical function for the agency. 3. Acentra Health LLC is the sole awardee, raising questions about competition. 4. The contract duration is one year, suggesting a need for ongoing services. 5. The award falls under the 'All Other Insurance Related Activities' NAICS code. 6. The contract is managed by the Office of the Assistant Secretary for Administration and Management. 7. The contract is not a small business set-aside. 8. The contract is a definitive contract, typically used for larger, more complex procurements.

Value Assessment

Rating: fair

Benchmarking the value of this contract requires more detailed information on the scope of services and the volume of medical bills processed. Without comparable contract data for similar medical bill processing services, it is difficult to definitively assess if the $7.2 million price represents excellent value. The firm-fixed-price structure provides cost certainty, but the absence of competition could potentially lead to less favorable pricing than if multiple vendors had vied for the contract. Further analysis would involve understanding the specific performance metrics and deliverables tied to this price point.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning that only one vendor, Acentra Health LLC, was solicited and awarded the contract. The provided data does not indicate the reasons for this sole-source determination, such as a specific justification like a critical need or lack of other qualified sources. The absence of a competitive bidding process means that the government did not benefit from the potential for price reductions or service enhancements that typically arise from multiple vendors competing for a contract.

Taxpayer Impact: A sole-source award limits the government's ability to leverage market competition to secure the best possible pricing and terms for taxpayers. This can result in higher costs compared to a competitively procured contract.

Public Impact

Beneficiaries include Department of Labor employees and potentially other individuals whose medical bills are processed by the agency. Services delivered include the processing of medical bills, ensuring accurate and timely payments. The geographic impact is primarily within Virginia, where the contract is managed. Workforce implications may include the need for specialized personnel within Acentra Health LLC to handle the contract's requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source award requires strong justification to ensure necessity and fairness.
Limited transparency into the selection process due to non-competitive nature.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to an established entity (Acentra Health LLC) may indicate reliability.
Contract is for essential administrative support services.

Sector Analysis

The healthcare administrative services sector is a significant part of the broader healthcare industry, focusing on the operational and financial aspects of healthcare delivery. This contract for medical bill processing falls within the 'Insurance Related Activities' category. The market for these services is driven by the increasing complexity of healthcare billing, regulatory compliance, and the need for efficient claims management. Comparable spending benchmarks would typically involve analyzing other government contracts for similar claims processing or administrative support services within federal agencies.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses. Therefore, this specific award does not directly contribute to the small business ecosystem through set-aside provisions. The impact on small businesses would depend on whether Acentra Health LLC engages them as subcontractors, which is not specified in the provided data.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Labor's Office of the Assistant Secretary for Administration and Management. Accountability measures would be defined in the contract's terms and conditions, including performance standards and payment schedules. Transparency is limited due to the sole-source nature of the award, as the competitive process, which usually offers more public insight into vendor selection, was not utilized. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Employee Health Benefits Program Administration
Department of Labor Claims Processing
Healthcare Claims Adjudication Services
Government Medical Bill Management

Risk Flags

Sole-source award lacks competitive justification.
Potential for higher costs due to lack of competition.
Performance metrics and oversight details not fully specified.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $7.2 million to ACENTRA HEALTH LLC. BRIDGE CONTRACT FOR MEDICAL BILL PROCESSING SERVICES

Who is the contractor on this award?

The obligated recipient is ACENTRA HEALTH LLC.

Which agency awarded this contract?

Awarding agency: Department of Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $7.2 million.

What is the period of performance?

Start: 2025-07-01. End: 2026-06-30.

What is Acentra Health LLC's track record with federal contracts, particularly for medical bill processing?

Acentra Health LLC has a history of performing services for federal agencies, including contracts related to healthcare administration and claims processing. While specific details on their track record for medical bill processing within the Department of Labor are not fully elaborated in the provided data, their existing presence in the federal contracting space suggests some level of established capability. Further investigation into their past performance reviews, contract history with agencies like CMS or VA, and any reported issues or successes would provide a more comprehensive understanding of their reliability and expertise in handling such sensitive and critical functions. Assessing their performance on similar contracts can help gauge their ability to meet the requirements of this new award.

How does the $7.2 million contract value compare to similar medical bill processing contracts awarded by other federal agencies?

Direct comparison of the $7.2 million contract value for medical bill processing is challenging without specific details on the volume of bills, complexity of claims, and scope of services included. However, federal agencies often contract for claims processing and related administrative services. For instance, contracts for processing Medicare or Medicaid claims can range from millions to hundreds of millions of dollars, depending on the scale and specific functions. The Department of Veterans Affairs also procures extensive healthcare administrative support. To benchmark this contract effectively, one would need to identify contracts with similar service definitions and award amounts from agencies managing comparable healthcare populations or administrative loads. The sole-source nature of this award also complicates direct value-for-money comparisons against competitively bid contracts.

What are the primary risks associated with a sole-source award for critical administrative services like medical bill processing?

The primary risks associated with a sole-source award for critical administrative services like medical bill processing include potential overpricing due to lack of competition, reduced incentive for the contractor to innovate or improve efficiency, and a lack of transparency in the procurement process. Taxpayers may bear higher costs if the selected vendor does not face market pressure to offer competitive rates. Furthermore, if the sole-source vendor underperforms or faces unforeseen issues, the agency may have limited recourse or alternatives for immediate service continuity. The absence of a competitive process also means the agency foregoes the opportunity to discover potentially more capable or cost-effective solutions from other market participants.

What is the expected effectiveness of Acentra Health LLC in fulfilling the Department of Labor's medical bill processing needs?

The expected effectiveness of Acentra Health LLC in fulfilling the Department of Labor's medical bill processing needs hinges on their demonstrated capabilities and the clarity of the contract's performance requirements. As a sole-source award, the agency has presumably vetted Acentra Health's ability to meet these needs. Effectiveness will be measured by their ability to process bills accurately, within established timeframes, and in compliance with all relevant regulations. Key performance indicators (KPIs) within the contract, such as error rates, turnaround times, and data security protocols, will be crucial in assessing their performance. A history of successful contract performance in similar roles would suggest a higher likelihood of effectiveness.

How has the Department of Labor's spending on medical bill processing services evolved over the past five years?

Information on the Department of Labor's historical spending specifically on medical bill processing services over the past five years is not directly available from the provided data. This contract represents a new award or a continuation of services that may have been previously handled internally or through different contract vehicles. To analyze historical spending patterns, one would need to access broader federal procurement databases and filter for contracts related to medical bill processing, claims management, or similar administrative support services awarded by the Department of Labor. Examining trends in contract values, number of awards, and types of services procured over time would reveal spending evolution.

Industry Classification

NAICS: Finance and Insurance › Agencies, Brokerages, and Other Insurance Related Activities › All Other Insurance Related Activities

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 1605C3-25-R-00003

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1600 TYSONS BLVD STE 1000, MCLEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $90,431,013

Exercised Options: $30,071,012

Current Obligation: $7,192,924

Actual Outlays: $16,856,608

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline