HHS awards $85.3M contract for ACO-OS and UI development to SOFTRAMS LLC

Contract Overview

Contract Amount: $85,346,872 ($85.3M)

Contractor: Softrams LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2019-08-28

End Date: 2024-02-27

Contract Duration: 1,644 days

Daily Burn Rate: $51.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: TO OBTAIN SUPPORT IN PLANNING, DEVELOPING AND OPERATING THE ACCOUNTABLE CARE ORGANIZATION - OPERATIONAL SYSTEM (ACO-OS) AND USER INTERFACE (UI).

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $85.3 million to SOFTRAMS LLC for work described as: TO OBTAIN SUPPORT IN PLANNING, DEVELOPING AND OPERATING THE ACCOUNTABLE CARE ORGANIZATION - OPERATIONAL SYSTEM (ACO-OS) AND USER INTERFACE (UI). Key points: 1. Contract focuses on critical IT infrastructure for the Accountable Care Organization Operating System (ACO-OS) and User Interface (UI). 2. Full and open competition indicates a potentially competitive bidding process. 3. The contract duration of over 1600 days suggests a long-term need for these services. 4. The firm-fixed-price structure aims to control costs for the government. 5. This award represents a significant investment in healthcare IT modernization. 6. The services are essential for the operational success of the ACO program.

Value Assessment

Rating: good

The contract value of $85.3 million over approximately 4.5 years for custom computer programming services appears reasonable given the scope of developing and operating a complex system like ACO-OS and its UI. Benchmarking against similar large-scale IT development contracts for government health programs suggests that this pricing is within expected ranges. The firm-fixed-price contract type provides cost certainty for the government, mitigating the risk of cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple vendors were eligible to bid. The data indicates six bids were received, which is a healthy number for a contract of this complexity and value. A competitive process like this generally leads to better price discovery and potentially more innovative solutions as vendors vie for the award.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently by fostering a competitive environment that drives down costs and encourages high-quality service delivery.

Public Impact

Beneficiaries of the Accountable Care Organization (ACO) program will experience improved operational efficiency and potentially better coordinated care through the enhanced ACO-OS and UI. Healthcare providers participating in ACOs will benefit from a more robust and user-friendly system for managing patient data and care coordination. The Centers for Medicare and Medicaid Services (CMS) will gain improved capabilities for managing and overseeing ACO performance. The contract supports the broader goals of healthcare reform by enabling better data management and operational support for value-based care initiatives. The workforce involved in developing and maintaining the ACO-OS and UI will see continued employment opportunities in specialized IT roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if requirements are not clearly defined and managed throughout the contract lifecycle.
Dependence on a single contractor for critical operational systems could pose a risk if performance issues arise.
Ensuring ongoing alignment with evolving healthcare regulations and technological advancements will be crucial.

Positive Signals

The firm-fixed-price contract structure provides cost predictability for the government.
Full and open competition with multiple bidders suggests a robust selection process.
The long contract duration indicates a sustained commitment to improving the ACO program's IT infrastructure.

Sector Analysis

This contract falls within the Health Information Technology (Health IT) sector, a rapidly growing area focused on leveraging technology to improve healthcare delivery, efficiency, and patient outcomes. The market for Health IT solutions, particularly those supporting value-based care models like Accountable Care Organizations, is substantial and competitive. This contract for developing and operating the ACO-OS and UI is a key component of the Centers for Medicare and Medicaid Services' (CMS) strategy to modernize its IT infrastructure and support its mission.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. While the primary awardee is SOFTRAMS LLC, there is no explicit information provided regarding subcontracting plans or goals for small businesses. Further analysis would be needed to determine if small businesses are being leveraged for specialized services or if there are opportunities for them within the subcontracting chain.

Oversight & Accountability

Oversight for this contract is likely managed by the Centers for Medicare and Medicaid Services (CMS), a division of the Department of Health and Human Services (HHS). Specific oversight mechanisms would typically include regular performance reviews, milestone tracking, and adherence to contractual deliverables. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General's office for HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Accountable Care Organization (ACO) Programs
Health Information Technology Services
Custom Computer Programming
Centers for Medicare and Medicaid Services (CMS) IT Modernization

Risk Flags

Cybersecurity Risk
Performance Risk
Scope Creep Risk
Vendor Lock-in Potential

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $85.3 million to SOFTRAMS LLC. TO OBTAIN SUPPORT IN PLANNING, DEVELOPING AND OPERATING THE ACCOUNTABLE CARE ORGANIZATION - OPERATIONAL SYSTEM (ACO-OS) AND USER INTERFACE (UI).

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 $85.3 million.

What is the period of performance?

Start: 2019-08-28. End: 2024-02-27.

What is the track record of SOFTRAMS LLC in delivering similar large-scale IT development and operational support contracts for federal health agencies?

Information regarding SOFTRAMS LLC's specific track record with large-scale IT development and operational support for federal health agencies is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and client testimonials. However, securing an $85.3 million contract from HHS suggests a level of capability and trust. Further due diligence would involve examining their experience with systems comparable to ACO-OS and UI, their ability to meet stringent security and compliance requirements (e.g., HIPAA), and their history of on-time and within-budget delivery on previous federal contracts. Understanding their past performance in managing complex stakeholder relationships within government healthcare environments would also be crucial for evaluating their suitability for this ongoing operational support.

How does the awarded value of $85.3 million compare to the estimated market rates for developing and operating a custom operational system and user interface of this complexity?

The awarded value of $85.3 million over approximately 4.5 years for the development and operation of the ACO-OS and UI appears to be within a reasonable range for a contract of this magnitude and complexity within the federal health IT sector. Custom computer programming services for large-scale, mission-critical systems often involve significant upfront development costs, ongoing maintenance, and specialized expertise. Benchmarking against similar contracts for developing and managing operational systems for agencies like CMS, which handle vast amounts of sensitive data and serve millions of beneficiaries, suggests that this figure is competitive. Factors influencing this value include the scope of work, the required technical expertise, security protocols, and the duration of the contract. The firm-fixed-price nature of the contract also implies that the government has negotiated a ceiling price, aiming for cost efficiency.

What are the primary risks associated with this contract, and what mitigation strategies are likely in place?

Primary risks associated with this contract include potential technical challenges in developing and integrating the ACO-OS and UI, cybersecurity threats to sensitive health data, contractor performance issues, and the risk of scope creep if requirements evolve significantly. Mitigation strategies likely include robust project management by CMS, adherence to strict cybersecurity protocols and compliance with HIPAA, clearly defined performance metrics and service level agreements (SLAs), and a structured change management process for any scope adjustments. The firm-fixed-price contract also incentivizes the contractor to manage costs effectively. Regular performance reviews and potential for contract modifications based on evolving needs would also be part of the oversight to manage these risks.

How effective is the ACO-OS and UI system expected to be in supporting the goals of the Accountable Care Organization program?

The ACO-OS and UI system is expected to be highly effective in supporting the goals of the Accountable Care Organization program by providing a centralized platform for managing operational data, facilitating communication, and enabling performance monitoring. Its effectiveness hinges on its ability to streamline administrative processes for ACOs, improve data accuracy and accessibility for CMS, and provide actionable insights into provider performance and patient outcomes. A well-designed and efficiently operated system can enhance care coordination, reduce administrative burden on providers, and ultimately contribute to better quality of care and cost savings, which are the core objectives of the ACO model. The success will depend on user adoption, system reliability, and its capacity to adapt to evolving healthcare policies and technological advancements.

What are the historical spending patterns for similar IT development and operational support contracts within the Centers for Medicare and Medicaid Services?

Historical spending patterns for similar IT development and operational support contracts within CMS indicate a significant and consistent investment in modernizing its technological infrastructure. CMS manages some of the largest and most complex IT systems in the federal government, supporting programs like Medicare and Medicaid. Spending in this area typically involves substantial multi-year contracts for system development, maintenance, data analytics, and cybersecurity. The values often range from tens to hundreds of millions of dollars, reflecting the scale and criticality of these systems. Trends show an increasing focus on cloud computing, data analytics, interoperability, and user experience improvements, driving demand for specialized IT services. The $85.3 million awarded to SOFTRAMS LLC aligns with the typical investment levels for major IT initiatives within CMS.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

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

Business Categories: 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: $103,874,908

Exercised Options: $85,346,872

Current Obligation: $85,346,872

Actual Outlays: $53,990,886

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $14,163,057

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F372DA

IDV Type: FSS

Timeline