HHS awards $27.2M contract for Medicare Advantage encounter data processing, ensuring data integrity for policy support

Contract Overview

Contract Amount: $27,208,906 ($27.2M)

Contractor: Acentra Health LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2022-06-22

End Date: 2026-06-21

Contract Duration: 1,460 days

Daily Burn Rate: $18.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE PURPOSE OF THIS REQUEST IS TO RECOMPETE THE ENCOUNTER DATA PROCESSING SYSTEM WHICH COLLECTS AND VALIDATES ENCOUNTER DATA TO SUPPORT MPPG 002915 ENCOUNTER DATA COLLECTIONS FROM MEDICARE ADVANTAGE PLANS.

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $27.2 million to ACENTRA HEALTH LLC for work described as: THE PURPOSE OF THIS REQUEST IS TO RECOMPETE THE ENCOUNTER DATA PROCESSING SYSTEM WHICH COLLECTS AND VALIDATES ENCOUNTER DATA TO SUPPORT MPPG 002915 ENCOUNTER DATA COLLECTIONS FROM MEDICARE ADVANTAGE PLANS. Key points: 1. The contract focuses on critical data validation for Medicare Advantage plans, directly supporting policy development and financial oversight. 2. A firm-fixed-price structure aims to control costs, though the total value is subject to delivery orders. 3. The re-competition of this essential service suggests a focus on maintaining and improving data processing capabilities. 4. The duration of the contract, extending over four years, indicates a need for sustained operational support. 5. The primary contractor has been awarded this task, highlighting a potential focus on continuity of service. 6. The contract is categorized under Custom Computer Programming Services, reflecting its technical nature.

Value Assessment

Rating: good

The contract value of approximately $27.2 million over four years for encounter data processing appears reasonable given the critical nature of the service. Benchmarking against similar IT services contracts for data validation and processing within HHS or CMS would provide a more precise value-for-money assessment. The firm-fixed-price type suggests cost predictability for the government, assuming the scope of work remains consistent. Without specific per-unit data or detailed service level agreements, a definitive value assessment is challenging, but the re-competition implies a desire for continued, reliable service at a competitive price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of four bids suggests a healthy level of interest and competition for this service. A competitive bidding process generally leads to better price discovery and potentially more innovative solutions as contractors vie for the award. The government's ability to select from multiple qualified bidders enhances its position in negotiating favorable terms and pricing.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces and encourages a wider pool of contractors to offer their services, potentially leading to cost savings and improved service quality.

Public Impact

Medicare Advantage plans benefit through a clear process for submitting and validating encounter data. The Centers for Medicare and Medicaid Services (CMS) benefits from accurate and validated data to support policy analysis, program integrity, and financial management. Taxpayers benefit from efficient use of funds through competitive procurement and reliable data supporting healthcare program oversight. The healthcare sector, particularly entities involved in Medicare Advantage, relies on this system for compliance and operational efficiency. The workforce involved includes IT professionals, data analysts, and administrative staff supporting the system's operation and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the incumbent's solution is highly specialized and difficult to transition.
Risk of scope creep if requirements evolve significantly beyond the initial contract scope, potentially increasing costs.
Dependence on the contractor's ability to maintain data security and privacy standards for sensitive Medicare beneficiary information.
Challenges in ensuring continuous service quality and performance throughout the contract duration.
Potential for underestimation of the complexity or volume of data processing required, impacting performance.

Positive Signals

Awarded under full and open competition, indicating a robust selection process and potential for competitive pricing.
Firm-fixed-price contract type provides cost certainty for the government, mitigating budget risks.
The contract's re-competition suggests a focus on maintaining essential government functions and potentially improving existing processes.
The contractor, ACENTRA HEALTH LLC, has experience in this domain, potentially ensuring continuity and expertise.
The contract duration of four years allows for stability and long-term planning for data processing needs.

Sector Analysis

This contract falls within the IT services sector, specifically custom computer programming. The market for healthcare IT, particularly data processing and analytics for government programs like Medicare Advantage, is substantial and growing. Companies in this space often specialize in handling large volumes of sensitive data, ensuring compliance with regulations like HIPAA, and providing robust analytical capabilities. The spending benchmark for similar IT services contracts within federal agencies can range widely, but contracts focused on critical data infrastructure and compliance often represent significant investments due to their complexity and importance to agency operations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). The prime contractor, ACENTRA HEALTH LLC, is likely a large business. There is no explicit information regarding subcontracting plans for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting opportunities. Further investigation into subcontracting reports would be needed to assess any indirect benefits.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS), the awarding agency. Mechanisms likely include regular performance reviews, adherence to Service Level Agreements (SLAs), and financial audits. The firm-fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally maintained through contract databases like FPDS-NG. While specific Inspector General (IG) jurisdiction isn't detailed, the HHS OIG would have oversight authority concerning fraud, waste, and abuse related to federal funds.

Related Government Programs

Medicare Data Processing
Healthcare IT Services
Custom Computer Programming
Federal Data Analytics
CMS IT Contracts
Health Insurance Portability and Accountability Act (HIPAA) Compliance

Risk Flags

Data Security and Privacy
Performance Reliability
Cost Overruns
Vendor Lock-in
Regulatory Compliance

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $27.2 million to ACENTRA HEALTH LLC. THE PURPOSE OF THIS REQUEST IS TO RECOMPETE THE ENCOUNTER DATA PROCESSING SYSTEM WHICH COLLECTS AND VALIDATES ENCOUNTER DATA TO SUPPORT MPPG 002915 ENCOUNTER DATA COLLECTIONS FROM MEDICARE ADVANTAGE PLANS.

Who is the contractor on this award?

The obligated recipient is ACENTRA HEALTH 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 $27.2 million.

What is the period of performance?

Start: 2022-06-22. End: 2026-06-21.

What is the historical spending pattern for the Encounter Data Processing System contract?

The provided data shows a current award of $27,208,905.52 for the Encounter Data Processing System, with an estimated completion date of June 21, 2026. This represents a re-competition of the service. To understand the historical spending pattern, one would need to examine previous contract awards for this specific system or similar functions within CMS. Analyzing data from prior years would reveal trends in contract value, duration, and contractor performance. For instance, if previous contracts were significantly smaller or larger, it could indicate changes in scope, data volume, or market pricing. Understanding the historical context is crucial for assessing whether the current award represents an increase or decrease in investment and if it aligns with evolving program needs or technological advancements.

How does the per-unit cost of processing encounter data compare to industry benchmarks?

The provided data does not include specific per-unit cost metrics for processing encounter data, such as cost per encounter record or cost per validated record. Therefore, a direct comparison to industry benchmarks is not possible with the given information. To perform such an analysis, detailed operational data from the contractor would be required, outlining the volume of data processed and the associated costs. Industry benchmarks for healthcare data processing vary significantly based on the complexity of the data, the level of validation required, and the technology used. Generally, government contracts aim for cost-effectiveness, but without granular data, it's difficult to definitively assess if this contract's per-unit cost is competitive.

What is ACENTRA HEALTH LLC's track record with similar government contracts, particularly within HHS or CMS?

ACENTRA HEALTH LLC is the prime contractor for this Encounter Data Processing System contract. To assess their track record, one would need to review their past performance on similar contracts, especially those involving data processing, validation, and IT services for federal health agencies like HHS and CMS. Databases such as the Federal Procurement Data System (FPDS) can provide information on previous awards, contract values, and performance ratings, if available. A review of past performance evaluations, any past performance issues or disputes, and the successful completion of prior contracts would offer insight into their capabilities and reliability in managing complex government IT projects. Their experience with Medicare Advantage data specifically would be a key indicator of suitability.

What are the key performance indicators (KPIs) for this contract, and how is performance measured?

The provided data does not explicitly list the Key Performance Indicators (KPIs) for this Encounter Data Processing System contract. However, given the purpose of the contract – collecting and validating encounter data – likely KPIs would revolve around data accuracy, completeness, timeliness of processing, system uptime, and security compliance. Performance measurement would typically involve regular reporting by the contractor, government reviews of these reports, and potentially site visits or audits. The contract likely includes a Service Level Agreement (SLA) that defines specific performance targets and the consequences of failing to meet them. These KPIs are crucial for ensuring the integrity of Medicare Advantage data, which supports critical policy and financial decisions.

What is the potential impact of this contract on the overall efficiency and effectiveness of Medicare Advantage program oversight?

This contract is fundamental to the effective oversight of the Medicare Advantage program. By ensuring the accurate collection and validation of encounter data, it provides CMS with reliable information necessary for risk adjustment, quality measurement, and program integrity efforts. Accurate data allows CMS to better understand the health status of beneficiaries enrolled in Medicare Advantage plans, which is critical for appropriate payment. It also enables the identification of potential fraud, waste, and abuse. The efficiency of this data processing directly impacts CMS's ability to make timely policy adjustments, manage program finances accurately, and ensure that beneficiaries receive appropriate care. A robust and well-functioning encounter data system enhances the overall effectiveness of CMS's stewardship of the Medicare Advantage program.

Are there any known risks associated with the transition or continuation of this encounter data processing service?

Potential risks associated with this contract include data security and privacy breaches, given the sensitive nature of Medicare beneficiary information. There's also a risk of service disruption if the contractor fails to meet performance standards or experiences technical issues, which could impact CMS's ability to process and analyze critical data. Another risk is the potential for cost overruns if the scope of work expands beyond initial estimates, despite the firm-fixed-price structure. Furthermore, if the contractor's system is highly specialized, transitioning to a new vendor in the future could be complex and costly. Ensuring continuous compliance with evolving healthcare regulations and data standards also presents an ongoing risk that requires diligent management by both the contractor and 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 › IT AND TELECOM - APLLICATIONS

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: 1600 TYSONS BLVD, MCLEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,472,836

Exercised Options: $27,208,906

Current Obligation: $27,208,906

Actual Outlays: $24,278,421

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F711GA

IDV Type: FSS

Timeline