HHS awards $22.5M IT lifecycle support contract to Halfaker and Associates, LLC

Contract Overview

Contract Amount: $22,533,364 ($22.5M)

Contractor: Halfaker and Associates, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2017-11-28

End Date: 2019-11-27

Contract Duration: 729 days

Daily Burn Rate: $30.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: IGF::OT::IGF LEGISLATIVE IT LIFECYCLE SUPPORT

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22206

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $22.5 million to HALFAKER AND ASSOCIATES, LLC for work described as: IGF::OT::IGF LEGISLATIVE IT LIFECYCLE SUPPORT Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Award Fee, which incentivizes performance but requires careful oversight. 3. The duration of 729 days (2 years) indicates a medium-term need for IT support. 4. The North American Industry Classification System (NAICS) code 541512 points to computer systems design services. 5. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract vehicle. 6. The base contract value is $22.5 million, with potential for adjustments based on award fees.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without knowing the scope of services and the underlying IDIQ contract it was issued under. However, the Cost Plus Award Fee (CPAF) structure suggests that the government aims to achieve good value by incentivizing contractor performance. The total award value of $22.5 million over two years averages to approximately $11.25 million annually. This figure needs to be compared against similar IT lifecycle support contracts within the federal government, considering the specific services rendered and the complexity involved. Without more granular data on the services provided and the performance metrics, a definitive value-for-money assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 9 bidders suggests a healthy level of competition for this IT lifecycle support requirement. A competitive process like this generally leads to better price discovery and potentially more favorable terms for the government, as contractors vie to win the award. The number of bidders provides a good indication that the market has sufficient capacity and interest in providing these services.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple companies competed to offer the best value. This competitive environment helps prevent inflated pricing and encourages innovation.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) and potentially other agencies utilizing the IT lifecycle support services. Services delivered encompass computer systems design and related IT lifecycle support. The geographic impact is primarily within Virginia, where the contractor is located, but the services support federal operations. Workforce implications include employment opportunities for IT professionals within Halfaker and Associates, LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts require diligent oversight to ensure award fees are earned appropriately and not excessively awarded.
The specific IT lifecycle support services need to be clearly defined and monitored to ensure they meet CMS's evolving needs.
Reliance on a single delivery order under a potentially larger IDIQ could concentrate risk if the IDIQ vehicle itself has limitations.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The contractor, Halfaker and Associates, LLC, has experience in federal IT services.
The contract aims to provide essential IT lifecycle support, crucial for agency operations.

Sector Analysis

The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract falls within the broader category of IT professional services, specifically focusing on computer systems design and lifecycle support. The market includes a wide range of companies, from large system integrators to specialized IT service providers. Benchmarking this contract's value would involve comparing its annual cost against similar IT support contracts awarded by agencies like HHS or other health-focused federal entities, considering factors like service scope, complexity, and contractor performance.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific small business subcontracting requirements explicitly stated in the provided data. Therefore, its direct impact on the small business ecosystem is likely minimal unless Halfaker and Associates, LLC voluntarily engages small businesses for subcontracting. Analysis of subcontracting plans would be necessary to determine the extent of small business participation.

Oversight & Accountability

Oversight for this contract would primarily fall under the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. As a Cost Plus Award Fee contract, performance monitoring and the justification for awarded fees are critical oversight functions. Transparency is facilitated through federal contract databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

IT Lifecycle Support Services
Computer Systems Design Services
Health Information Technology Services
CMS IT Modernization Efforts
Federal IT Professional Services

Risk Flags

Cost Plus Award Fee structure requires robust oversight.
Potential for scope creep if not managed tightly.
Dependence on performance metrics for award fee justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $22.5 million to HALFAKER AND ASSOCIATES, LLC. IGF::OT::IGF LEGISLATIVE IT LIFECYCLE SUPPORT

Who is the contractor on this award?

The obligated recipient is HALFAKER AND ASSOCIATES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Medicare and Medicaid Services).

What is the total obligated amount?

The obligated amount is $22.5 million.

What is the period of performance?

Start: 2017-11-28. End: 2019-11-27.

What is the track record of Halfaker and Associates, LLC with federal IT contracts, particularly with CMS?

Halfaker and Associates, LLC has a notable track record in providing IT services to federal agencies, including significant work with the Department of Veterans Affairs (VA) and the Department of Health and Human Services (HHS), which oversees CMS. Their experience often spans areas like health IT, data analytics, and systems modernization. For CMS specifically, their past performance would be detailed in contract award histories, often reflecting their ability to manage complex IT projects and meet performance requirements. A review of their contract portfolio would reveal the types of services rendered, contract values, and performance ratings on similar engagements. This specific contract, valued at $22.5 million over two years, indicates a substantial engagement, suggesting a level of trust and proven capability in supporting critical healthcare IT infrastructure.

How does the $22.5 million contract value compare to similar IT lifecycle support contracts within HHS or CMS?

The $22.5 million contract value for two years of IT lifecycle support, averaging $11.25 million annually, places it in the mid-to-large tier for individual IT service contracts within HHS. Comparable contracts for similar services (e.g., systems design, development, maintenance, modernization) at CMS or other large HHS operating divisions can range significantly, from a few million to tens or even hundreds of millions of dollars, depending on the scope and duration. For instance, major system modernizations or enterprise-wide IT infrastructure support contracts often exceed this value. However, for a specific IT lifecycle support delivery order under an IDIQ, this value appears reasonable, especially given the critical nature of CMS systems. A precise comparison would require analyzing contracts with similar NAICS codes (541512) and service descriptions awarded within the same timeframe and agency.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract structure for IT lifecycle support?

The primary risks associated with a Cost Plus Award Fee (CPAF) contract for IT lifecycle support revolve around ensuring that the 'award fee' component is justified and truly reflects exceptional performance, rather than being a de facto increase in profit margin. Key risks include: 1. **Potential for inflated costs:** Contractors may incur costs that are necessary but not efficiently managed, knowing that the base fee and potential award fee provide a safety net. 2. **Subjectivity in award fee determination:** The criteria for earning award fees must be objective and clearly defined. If subjective, it can lead to disputes or perceptions of unfairness. 3. **Contractor focus on fee targets over mission needs:** While designed to incentivize performance, there's a risk contractors might prioritize meeting award fee metrics over addressing unforeseen or more critical mission requirements that fall outside the defined metrics. 4. **Oversight burden:** The government requires robust oversight mechanisms to monitor costs, evaluate performance against criteria, and justify award fee decisions, which can be resource-intensive.

How effective is full and open competition in ensuring value for money for IT services like this?

Full and open competition is generally considered the most effective method for ensuring value for money in federal IT services. By allowing all responsible sources to compete, it maximizes the pool of potential offerors, thereby increasing the likelihood of receiving competitive bids. This competitive pressure drives down prices and encourages innovation as contractors strive to differentiate themselves based on technical merit, past performance, and cost-effectiveness. The presence of 9 bidders on this specific contract suggests that the market was sufficiently robust to support a competitive process. While CPAF contracts introduce complexities in assessing final value, the initial competitive award sets a strong foundation for achieving fair pricing and selecting the best-suited solution for the government's needs.

What are the historical spending patterns for IT lifecycle support at CMS?

Historical spending patterns for IT lifecycle support at CMS show a consistent and significant investment in maintaining and modernizing its vast IT infrastructure. CMS manages critical systems like the Medicare and Medicaid Electronic Health Record (EHR) incentive programs, the Health Insurance Marketplace, and various data analytics platforms. Consequently, IT lifecycle support, encompassing everything from system design and development to ongoing maintenance, security, and upgrades, represents a substantial portion of its budget. Spending in this area has generally trended upwards over the years, driven by increasing data volumes, evolving regulatory requirements, the need for enhanced cybersecurity, and the push towards interoperability and patient-centered care. Contracts for these services are often awarded through IDIQ vehicles, with numerous delivery orders issued over time, reflecting the continuous nature of IT support needs.

What are the implications of this contract being a Delivery Order under a potentially larger IDIQ contract?

This contract being a Delivery Order (DO) under an Indefinite Delivery/Indefinite Quantity (IDIQ) contract means it represents a specific task or set of tasks to be performed within the broader scope and terms established by the parent IDIQ contract. The implications are several: 1. **Streamlined Procurement:** IDIQs allow agencies to pre-qualify contractors, making subsequent task orders faster to award. 2. **Flexibility:** Agencies can order services as needed, up to the IDIQ ceiling, providing flexibility in adapting to changing requirements. 3. **Scope Limitation:** The services must fall within the scope defined by the parent IDIQ. If CMS requires services significantly outside that scope, a new contract vehicle might be needed. 4. **Competition within IDIQ:** Depending on the IDIQ's structure, task orders might be competed among multiple awardees of the IDIQ, or awarded to a single awardee based on pre-defined terms. The data indicates 9 bidders for this specific DO, suggesting it was competed among potential awardees of the underlying IDIQ or a subset thereof.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: RFPCMS2016SPARC

Offers Received: 9

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Science Applications International Corporation

Address: 2900 S QUINCY ST STE 410, ARLINGTON, VA, 22206

Business Categories: 8(a) Program Participant, Category Business, Limited Liability Corporation, Minority Owned Business, Other Minority Owned Business, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Sole Proprietorship, Special Designations, U.S.-Owned Business, Veteran Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $22,533,364

Exercised Options: $22,533,364

Current Obligation: $22,533,364

Actual Outlays: $121,493

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $10,672,126

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HHSM500201600052I

IDV Type: IDC

Timeline