HHS awards $81M contract for IT operations and maintenance to SOFTRAMS LLC

Contract Overview

Contract Amount: $80,962,818 ($81.0M)

Contractor: Softrams LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2019-08-04

End Date: 2024-08-03

Contract Duration: 1,826 days

Daily Burn Rate: $44.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: PROVIDE ONGOING OPERATIONS AND MAINTENANCE SUPPORT

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $81.0 million to SOFTRAMS LLC for work described as: PROVIDE ONGOING OPERATIONS AND MAINTENANCE SUPPORT Key points: 1. Contract provides essential IT operations and maintenance, crucial for agency functionality. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. A firm-fixed-price structure aims to control costs and provide predictability. 4. The contract duration of five years indicates a long-term need for these services. 5. The award value represents a significant investment in maintaining critical IT infrastructure.

Value Assessment

Rating: good

The contract's value of approximately $81 million over five years suggests a substantial investment in IT support. Benchmarking against similar contracts for IT operations and maintenance within federal agencies is necessary for a precise value-for-money assessment. However, the firm-fixed-price structure is generally favorable for cost control. The provided data does not include specific performance metrics or unit costs to allow for a deeper comparison.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which typically means that all responsible sources were permitted to submit a bid. The specific phrasing suggests that while it was open, there might have been an initial exclusion of certain sources before the final open competition phase. The number of bidders is not specified, but open competition generally fosters price discovery and encourages competitive pricing.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the assurance that the government sought the best value from a wide pool of qualified contractors.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) and potentially healthcare providers and beneficiaries who rely on the stability of CMS IT systems. Services delivered include ongoing operations and maintenance support for critical IT systems. The geographic impact is primarily within Maryland, where the contractor is located, but the services support a national agency. Workforce implications include employment opportunities for IT professionals within SOFTRAMS LLC and potentially for subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if maintenance needs are not clearly defined.
Reliance on a single contractor for critical IT infrastructure could pose a risk if performance issues arise.
Ensuring continued innovation and adaptation to evolving IT landscapes within a fixed-term contract.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Long-term contract duration allows for stability and continuity of essential IT services.
Awarded through full and open competition, indicating a potentially competitive selection process.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically Custom Computer Programming Services. The federal IT market is vast, with significant spending on operations and maintenance to ensure the functionality of critical systems. Comparable spending benchmarks would involve analyzing other large-scale IT O&M contracts awarded by agencies like HHS or other departments managing complex data and service delivery platforms.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically related to small business set-asides for this particular award. The focus would be on whether the prime contractor, SOFTRAMS LLC, engages small businesses as subcontractors in its overall operations.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Centers for Medicare and Medicaid Services (CMS). Accountability measures are embedded in the contract terms, including performance standards and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IT Operations and Maintenance Support
Custom Computer Programming Services
Federal IT Infrastructure Management
Healthcare IT Services
Centers for Medicare and Medicaid Services IT Contracts

Risk Flags

Potential for vendor lock-in due to specialized knowledge.
Risk of performance degradation impacting critical government functions.
Cybersecurity vulnerabilities inherent in IT systems.
Contract duration may outpace technological advancements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $81.0 million to SOFTRAMS LLC. PROVIDE ONGOING OPERATIONS AND MAINTENANCE SUPPORT

Who is the contractor on this award?

The obligated recipient is SOFTRAMS 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 $81.0 million.

What is the period of performance?

Start: 2019-08-04. End: 2024-08-03.

What is the track record of SOFTRAMS LLC in performing similar federal IT operations and maintenance contracts?

Assessing the track record of SOFTRAMS LLC requires a review of their past performance on federal contracts, particularly those involving IT operations and maintenance. This would involve examining past performance evaluations, any contract modifications, and any instances of disputes or terminations. A history of successful, on-time, and within-budget performance on similar-sized and scoped contracts would indicate a lower risk. Conversely, a history of performance issues or contract disputes could raise concerns about their capability to meet the requirements of this $81 million award over five years. Without specific past performance data, it is difficult to definitively assess their reliability for this significant contract.

How does the awarded value of $81 million compare to similar IT O&M contracts within HHS or other federal agencies?

The $81 million award for five years of IT operations and maintenance support is a substantial sum, reflecting the critical nature of the services provided to the Centers for Medicare and Medicaid Services (CMS). To benchmark this value, one would compare it to similar contracts awarded by HHS or other large federal agencies (e.g., DoD, GSA) for comparable IT O&M services. Factors such as the scope of services (e.g., infrastructure management, application support, cybersecurity), the number of users supported, and the complexity of the systems involved would need to be considered. If this contract's per-year cost or total value is significantly higher or lower than comparable contracts, it could indicate either exceptional value or potential overpricing/underbidding. A detailed analysis would require access to a broader dataset of federal IT O&M contracts.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks for this IT operations and maintenance contract include potential performance failures that could disrupt critical CMS operations, cybersecurity vulnerabilities, cost overruns if the firm-fixed-price is not managed effectively, and contractor dependency. Mitigation strategies typically involve robust performance monitoring by the government, clearly defined service level agreements (SLAs), regular security audits, and contingency planning. The firm-fixed-price structure itself is a risk mitigation tool for cost control. The government's oversight, including regular reviews and the potential for contract termination for default, also serves as a deterrent against poor performance. The long duration also presents a risk of technological obsolescence if not managed proactively.

How effective is the firm-fixed-price (FFP) contract type in ensuring value for money for this specific IT O&M service?

The firm-fixed-price (FFP) contract type is generally considered effective for ensuring value for money when the scope of work is well-defined and the risks of cost overruns are manageable. For IT operations and maintenance, where requirements can sometimes evolve, FFP can incentivize the contractor to be efficient and control costs. However, it places a greater burden on the government to precisely define requirements upfront. If unforeseen technical challenges or scope changes arise, the contractor may seek adjustments, or the government might need to issue separate contracts, potentially leading to inefficiencies. The success of FFP here depends on the clarity of the SOW and the contractor's ability to manage their internal costs effectively.

What is the historical spending trend for IT operations and maintenance at CMS, and how does this award fit within that trend?

To understand the historical spending trend for IT operations and maintenance at CMS, one would need to analyze multi-year spending data for similar contract vehicles and services. This analysis would reveal whether spending in this area has been increasing, decreasing, or remaining stable. It would also show the typical contract values and durations awarded. This $81 million, five-year contract represents a significant, ongoing investment. If historical spending shows a consistent need for large-scale IT O&M contracts of this magnitude, then this award aligns with established patterns. Conversely, if it represents a substantial increase or decrease, it might signal a shift in CMS's IT strategy, budget priorities, or outsourcing approach.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: TWO STEP

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 161 FORT EVANS RD NE STE 205, LEESBURG, VA, 20176

Business Categories: 8(a) Program Participant, Category Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $80,962,818

Exercised Options: $80,962,818

Current Obligation: $80,962,818

Actual Outlays: $52,549,838

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline