Treasury's $6.6M Dental Insurance Contract with Delta Dental Faces Scrutiny Over Value and Competition
Contract Overview
Contract Amount: $6,642,462 ($6.6M)
Contractor: Delta Dental Insurance Company
Awarding Agency: Department of the Treasury
Start Date: 2025-07-01
End Date: 2026-12-31
Contract Duration: 548 days
Daily Burn Rate: $12.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIXED PRICE REDETERMINATION
Sector: Healthcare
Official Description: DENTAL INSURANCE
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20219
Plain-Language Summary
Department of the Treasury obligated $6.6 million to DELTA DENTAL INSURANCE COMPANY for work described as: DENTAL INSURANCE Key points: 1. The contract's value of $6.6 million over 548 days warrants a closer look at cost-effectiveness. 2. While listed as full and open competition, the specific provider (Delta Dental) raises questions about true market engagement. 3. Potential risks include overpricing and limited innovation due to a single dominant provider. 4. The sector is health insurance, a critical area for federal employee benefits.
Value Assessment
Rating: fair
The contract value of $6.6 million over 548 days averages approximately $12,121 per day. Benchmarking this against similar government dental insurance contracts is necessary to determine if the pricing is competitive.
Cost Per Unit: $12,121 per day
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition. However, the specific provider, Delta Dental, is a major player, and further analysis is needed to confirm if this truly fostered the most competitive price discovery or if other carriers were effectively excluded.
Taxpayer Impact: Taxpayer funds are being used for employee benefits. Ensuring competitive pricing is crucial to maximize the value of this expenditure and avoid overpaying for dental insurance.
Public Impact
Federal employees in Washington D.C. will receive dental insurance coverage under this contract. The contract supports the health and well-being of government personnel, contributing to workforce retention. The use of taxpayer dollars for this benefit highlights the need for fiscal responsibility and efficient procurement.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential lack of true competition despite 'full and open' designation
- Risk of inflated costs if market alternatives were not fully explored
- Dependence on a single large provider may limit service options or flexibility
Positive Signals
- Provides essential dental benefits to federal employees
- Contract duration allows for stable coverage over a defined period
- Awarded to a well-established insurance provider
Sector Analysis
This contract falls within the Health Insurance sector, specifically for dental coverage. Federal spending in this area is significant, covering millions of employees and dependents. Benchmarks for per-member-per-month costs in group dental plans are essential for evaluating this contract's value.
Small Business Impact
The data does not indicate any specific provisions or considerations for small businesses in this contract award. Further investigation would be needed to determine if small businesses had an opportunity to participate or if the contract was exclusively awarded to a large incumbent.
Oversight & Accountability
The Office of the Comptroller of the Currency (OCC) is the awarding agency. Standard government oversight mechanisms should be in place to monitor contract performance, ensure compliance with terms, and verify that the services meet the needs of federal employees.
Related Government Programs
- Direct Health and Medical Insurance Carriers
- Department of the Treasury Contracting
- Office of the Comptroller of the Currency Programs
Risk Flags
- Potential for non-competitive pricing
- Limited provider choice for federal employees
- Lack of transparency in the competition process
- Risk of service level degradation if provider is complacent
Tags
direct-health-and-medical-insurance-carr, department-of-the-treasury, dc, definitive-contract, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $6.6 million to DELTA DENTAL INSURANCE COMPANY. DENTAL INSURANCE
Who is the contractor on this award?
The obligated recipient is DELTA DENTAL INSURANCE COMPANY.
Which agency awarded this contract?
Awarding agency: Department of the Treasury (Office of the Comptroller of the Currency).
What is the total obligated amount?
The obligated amount is $6.6 million.
What is the period of performance?
Start: 2025-07-01. End: 2026-12-31.
What is the average cost per employee per month for this dental insurance contract, and how does it compare to industry benchmarks for similar federal employee plans?
The contract value is $6,642,462.12 over 548 days, averaging approximately $12,121 per day. To determine the cost per employee per month, the number of covered employees is required. Once known, this figure can be compared against federal employee dental plan benchmarks, typically ranging from $30-$60 per employee per month for comprehensive plans, to assess value for money.
Given Delta Dental's market position, what steps were taken during the 'full and open competition' to ensure genuine price discovery and prevent potential anti-competitive outcomes?
The 'full and open competition' designation implies that all responsible sources were permitted to submit offers. However, the agency should have actively solicited bids from a diverse range of dental insurance carriers, including smaller or regional providers, and rigorously evaluated proposals not just on price but also on the scope of benefits and network adequacy to ensure true market competition.
How effectively does this contract ensure the delivery of quality dental care and member satisfaction compared to alternative insurance models or providers?
Effectiveness hinges on the specific benefits package, provider network access, and claims processing efficiency offered by Delta Dental under this contract. Post-award monitoring and member satisfaction surveys are crucial to gauge the quality of care and service delivery. Comparing these metrics against established performance standards and potentially other federal dental plans would provide insight into its overall effectiveness.
Industry Classification
NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers
Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: 2031JW24R00002
Offers Received: 2
Pricing Type: FIXED PRICE REDETERMINATION (A)
Evaluated Preference: NONE
Contractor Details
Address: 560 MISSION ST, SAN FRANCISCO, CA, 94105
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $51,081,885
Exercised Options: $6,642,462
Current Obligation: $6,642,462
Actual Outlays: $2,424,939
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2025-07-01
Current End Date: 2026-12-31
Potential End Date: 2034-12-31 00:00:00
Last Modified: 2025-12-22
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