HHS awards $124.8M contract for program evaluation and development to Empower AI, Inc

Contract Overview

Contract Amount: $124,773,354 ($124.8M)

Contractor: Empower AI, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2018-03-08

End Date: 2027-02-28

Contract Duration: 3,279 days

Daily Burn Rate: $38.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SUPPORT- PROFESSIONAL: PROGRAM EVALUATION/REVIEW/DEVELOPMENT

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $124.8 million to EMPOWER AI, INC. for work described as: SUPPORT- PROFESSIONAL: PROGRAM EVALUATION/REVIEW/DEVELOPMENT Key points: 1. Contract focuses on administrative management and general management consulting services. 2. Awarded via full and open competition, indicating a broad search for qualified vendors. 3. The contract duration spans over 3,000 days, suggesting a long-term need for these services. 4. Firm-fixed-price contract type aims to control costs and provide predictable spending. 5. The contract is a delivery order under a larger contract vehicle. 6. Small business set-aside was not utilized for this specific award.

Value Assessment

Rating: good

The total award amount of $124.8 million over approximately 9 years represents a significant investment in program evaluation and development. Benchmarking against similar contracts for administrative management and general management consulting services is challenging without more specific service details. However, the firm-fixed-price structure suggests an effort to manage costs effectively. The number of bids received (4) provides some indication of market interest, but a deeper analysis of the pricing structure would be needed for a definitive value-for-money assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning that all responsible sources were permitted to submit a bid. Four bids were received, suggesting a moderate level of competition for this requirement. While four bidders indicate some market engagement, it is not exceptionally high, which could potentially limit price discovery compared to a more crowded field.

Taxpayer Impact: The full and open competition process is generally favorable for taxpayers as it aims to secure the best value by encouraging a wide range of potential contractors to compete, potentially driving down prices and improving service quality.

Public Impact

Beneficiaries include federal agencies requiring program evaluation and development expertise. Services delivered are critical for assessing the effectiveness and efficiency of government programs. The geographic impact is primarily within the federal government's operational scope, with potential for nationwide program improvements. Workforce implications may include the need for specialized consultants in program management and evaluation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to long contract duration.
Dependence on a single contractor for critical program evaluation services.
Risk of scope creep if program requirements are not clearly defined and managed.

Positive Signals

Firm-fixed-price contract helps control costs.
Full and open competition promotes a competitive bidding environment.
Long duration allows for sustained focus and deep understanding of programs.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on management consulting. This sector is a significant component of federal spending, supporting a wide array of government functions. The market for program evaluation and development services is competitive, with numerous firms offering specialized expertise. The total federal spending on administrative management and general management consulting services (NAICS 541611) is substantial, and this contract represents a portion of that investment.

Small Business Impact

This contract was not awarded as a small business set-aside. There is no explicit information provided regarding subcontracting plans for small businesses. The absence of a set-aside suggests that the primary focus was on securing the best overall solution from the broader market, rather than specifically targeting small business participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to deliver specified services within the agreed-upon price. Transparency is facilitated through contract award databases, though detailed performance metrics may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Program Management Support Services
Management and Financial Consulting, Acquisition and Grants Management Support
Professional, Scientific, and Technical Services
Government Program Management

Risk Flags

Long contract duration may pose risks of evolving requirements and vendor lock-in.
Moderate competition level (4 bidders) could limit optimal price discovery.
Lack of specific performance metrics in summary data makes detailed value assessment difficult.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $124.8 million to EMPOWER AI, INC.. SUPPORT- PROFESSIONAL: PROGRAM EVALUATION/REVIEW/DEVELOPMENT

Who is the contractor on this award?

The obligated recipient is EMPOWER AI, INC..

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 $124.8 million.

What is the period of performance?

Start: 2018-03-08. End: 2027-02-28.

What is the specific nature of the program evaluation and development services required under this contract?

The contract data indicates the service category is 'SUPPORT- PROFESSIONAL: PROGRAM EVALUATION/REVIEW/DEVELOPMENT' and the North American Industry Classification System (NAICS) code is 541611, which covers 'Administrative Management and General Management Consulting Services'. This suggests the services involve providing expert advice and assistance to federal agencies on how to plan, implement, manage, and assess their programs. This could include activities such as defining program goals, developing performance metrics, conducting impact assessments, recommending improvements, and ensuring compliance with regulations. The specific programs or initiatives to be evaluated are not detailed in the provided data but are likely within the purview of the Department of Health and Human Services (HHS) and its sub-agencies like the Centers for Medicare and Medicaid Services (CMS).

How does the $124.8 million award compare to typical spending for similar program evaluation contracts?

Comparing the $124.8 million award requires context on the scope and duration. This contract spans nearly 9 years (March 2018 to February 2027), making it a substantial, long-term engagement. Federal contracts for program evaluation and management consulting can range widely in value, from small, project-specific awards to multi-year, multi-million dollar Indefinite Delivery/Indefinite Quantity (IDIQ) vehicles. For a contract of this duration and breadth, covering potentially complex HHS programs, the $124.8 million figure appears to be within a reasonable range for a firm-fixed-price award. However, a precise benchmark would necessitate comparing it to contracts with identical or highly similar service requirements, agencies, and contract types.

What are the key performance indicators (KPIs) or deliverables expected from Empower AI, Inc. under this contract?

The provided data does not specify the key performance indicators (KPIs) or detailed deliverables for this contract. Typically, for program evaluation and development contracts, deliverables would include comprehensive reports on program findings, recommendations for improvement, strategic plans, performance measurement frameworks, and potentially presentations to agency leadership. KPIs would likely focus on the quality, timeliness, and impact of these deliverables, such as the accuracy of evaluations, the feasibility of recommendations, and the extent to which program outcomes are improved as a result of the contractor's work. These specifics are usually detailed in the Statement of Work (SOW) within the contract.

What is Empower AI, Inc.'s track record with federal contracts, particularly within HHS?

Empower AI, Inc. (formerly known as NCI Information Systems) has a history of performing federal contracts. While the provided data focuses on this specific award, a broader search of federal procurement databases would reveal their past performance across various agencies and contract types. Their experience likely includes providing IT services, data analytics, and management consulting, aligning with the services sought by HHS. Assessing their track record would involve reviewing past performance evaluations, contract completion history, and any documented issues or successes on previous government engagements, particularly those within the healthcare and human services sectors.

What is the risk associated with the long duration (3279 days) of this contract?

The long duration of 3279 days (approximately 9 years) presents several potential risks. Firstly, there's the risk of 'vendor lock-in,' where the agency becomes heavily reliant on a single contractor, potentially reducing flexibility and bargaining power over time. Secondly, program requirements or agency needs might evolve significantly over nearly a decade, and the contract may not adequately adapt, leading to inefficiencies or the need for costly modifications. Thirdly, maintaining consistent quality and performance from the contractor over such an extended period can be challenging. Finally, long-term contracts can sometimes face scrutiny regarding their initial cost-effectiveness if market conditions or service needs change substantially.

How does the firm-fixed-price (FFP) contract type influence cost control and risk for this program evaluation contract?

The firm-fixed-price (FFP) contract type is generally considered advantageous for cost control and risk mitigation for the government in service contracts like program evaluation. Under an FFP contract, the contractor assumes most of the risk for cost overruns. Empower AI, Inc. is obligated to perform the specified work for the agreed-upon price, regardless of their actual costs. This incentivizes the contractor to manage their resources efficiently and accurately estimate their costs upfront. For the government, it provides budget certainty and predictability, as the total cost is fixed. The primary risk for the government shifts from cost overruns to ensuring the contractor delivers the required quality and scope of services within that fixed price.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11730 PLAZA AMERICA DR, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $130,089,631

Exercised Options: $124,773,354

Current Obligation: $124,773,354

Actual Outlays: $75,274,242

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $9,053,042

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS00F263CA

IDV Type: FSS

Timeline