VA awards $143.7M Oracle Health contract for OEHRM Data Migration, no competition

Contract Overview

Contract Amount: $143,722,562 ($143.7M)

Contractor: Oracle Health Government Services, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2018-09-20

End Date: 2021-11-30

Contract Duration: 1,167 days

Daily Burn Rate: $123.2K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: OEHRM - TASK ORDER 0004 - DATA MIGRATION

Place of Performance

Location: KANSAS CITY, WYANDOTTE County, KANSAS, 66111

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $143.7 million to ORACLE HEALTH GOVERNMENT SERVICES, INC. for work described as: OEHRM - TASK ORDER 0004 - DATA MIGRATION Key points: 1. Significant investment in critical data migration for Veterans' health records. 2. Sole-source award raises questions about price discovery and potential overspending. 3. Contract duration of nearly 4 years suggests a complex and lengthy project. 4. Focus on IT services within the healthcare sector, a high-spending area.

Value Assessment

Rating: questionable

The $143.7 million award for data migration services appears high without competitive benchmarking. The firm fixed-price contract type offers some cost control, but the lack of competition limits the government's ability to ensure the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded sole-source, meaning there was no competition. This significantly limits the government's ability to discover the best price and potentially leads to higher costs compared to a competed contract.

Taxpayer Impact: The lack of competition on a large contract like this could result in taxpayers paying more than necessary for these critical data migration services.

Public Impact

Impacts the modernization of the Department of Veterans Affairs' electronic health record system. Potential for improved patient care and data accessibility for veterans. Risk of project delays or cost overruns due to sole-source nature.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
High contract value
Lack of competition

Positive Signals

Critical IT modernization effort
Focus on veteran healthcare data

Sector Analysis

This contract falls within the IT sector, specifically computer systems design services, supporting the healthcare industry. IT spending in healthcare is substantial, driven by the need for data management, system integration, and modernization.

Small Business Impact

The contract was awarded to Oracle Health Government Services, Inc., a large business. There is no indication that small businesses were involved in this specific task order, which is common for large, sole-source IT contracts.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure the contractor is meeting performance requirements and that costs remain justified. Transparency in reporting progress and expenditures will be crucial.

Related Government Programs

Computer Systems Design Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Sole-source award limits price competition.
Potential for cost overruns without competitive pressure.
Risk of vendor lock-in.
Complexity of large-scale data migration.
Dependency on a single vendor for critical health data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $143.7 million to ORACLE HEALTH GOVERNMENT SERVICES, INC.. OEHRM - TASK ORDER 0004 - DATA MIGRATION

Who is the contractor on this award?

The obligated recipient is ORACLE HEALTH GOVERNMENT SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $143.7 million.

What is the period of performance?

Start: 2018-09-20. End: 2021-11-30.

What was the justification for the sole-source award, and were alternative competitive strategies considered?

The justification for a sole-source award typically involves unique capabilities or urgent needs that only one vendor can meet. For this contract, the VA would need to provide documentation detailing why Oracle Health was the only viable option and why competition was not feasible or would be detrimental to the government's interests.

How will the VA ensure cost-effectiveness and prevent potential overruns given the lack of competition?

The VA can implement robust contract management practices, including detailed performance monitoring, regular cost reviews, and independent government cost estimates. Establishing clear milestones and deliverables with associated payments can also help control costs and ensure value for taxpayer money.

What are the key performance indicators (KPIs) for this data migration, and how will their achievement be measured?

Key performance indicators for data migration typically include data accuracy, completeness, timeliness, and system downtime during the transition. The VA should have defined metrics and testing protocols to rigorously measure the success of the migration against these KPIs, ensuring the integrity and usability of the migrated data.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cerner Corporation

Address: 10200 ABILITIES WAY, KANSAS CITY, KS, 66111

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

Financial Breakdown

Contract Ceiling: $143,722,562

Exercised Options: $143,722,562

Current Obligation: $143,722,562

Subaward Activity

Number of Subawards: 22

Total Subaward Amount: $27,751,057

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10B18D5000

IDV Type: IDC

Timeline