HHS Awards $146.5M for HIGLAS Hosting and Maintenance to General Dynamics IT

Contract Overview

Contract Amount: $146,505,619 ($146.5M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2023-09-29

End Date: 2026-12-31

Contract Duration: 1,189 days

Daily Burn Rate: $123.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: HEALTHCARE INTEGRATED GENERAL LEDGER ACCOUNTING SYSTEM (HIGLAS) HOSTING, OPERATIONS & MAINTENANCE (HOM)

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $146.5 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: HEALTHCARE INTEGRATED GENERAL LEDGER ACCOUNTING SYSTEM (HIGLAS) HOSTING, OPERATIONS & MAINTENANCE (HOM) Key points: 1. The contract is for hosting, operations, and maintenance of the HIGLAS system. 2. General Dynamics Information Technology, Inc. is the incumbent contractor. 3. The contract was awarded under full and open competition. 4. The contract duration is approximately 3.3 years, ending in December 2026.

Value Assessment

Rating: good

The award amount of $146.5 million over 1189 days suggests a significant investment in maintaining a critical healthcare system. Benchmarking against similar IT hosting and maintenance contracts would be necessary for a precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, indicating a robust price discovery process. This method generally leads to more competitive pricing as multiple vendors can bid.

Taxpayer Impact: The competitive nature of the award is expected to yield fair market value, ensuring taxpayer funds are used efficiently for essential IT services.

Public Impact

Ensures continued operation of the HIGLAS system, crucial for Medicare and Medicaid operations. Supports the financial management and accounting functions of CMS. Potential for service disruptions if operations and maintenance are not adequately performed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Contract type is Time and Materials, which can lead to cost overruns if not closely managed.
Contract duration is substantial, requiring ongoing oversight to ensure performance and value.

Positive Signals

Awarded under full and open competition.
Incumbent contractor likely has institutional knowledge, potentially leading to smoother transition and operations.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, specifically for IT hosting, operations, and maintenance. Spending in this area is substantial across federal agencies to support critical IT infrastructure.

Small Business Impact

The data does not indicate any specific set-asides for small businesses. The prime contractor is General Dynamics Information Technology, Inc., a large business. Further analysis would be needed to determine small business participation as subcontractors.

Oversight & Accountability

The contract is a delivery order under a larger contract, suggesting some level of pre-qualification. However, the Time and Materials pricing model necessitates close monitoring by CMS to ensure cost control and contractor performance.

Related Government Programs

Computer Systems Design Services
Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Time and Materials contract type increases cost risk.
Long contract duration requires sustained oversight.
Potential for vendor lock-in if competition is not maintained in future procurements.
Reliance on a single vendor for critical system operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $146.5 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. HEALTHCARE INTEGRATED GENERAL LEDGER ACCOUNTING SYSTEM (HIGLAS) HOSTING, OPERATIONS & MAINTENANCE (HOM)

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, 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 $146.5 million.

What is the period of performance?

Start: 2023-09-29. End: 2026-12-31.

What is the historical performance of General Dynamics Information Technology, Inc. on similar IT hosting and maintenance contracts, particularly regarding cost control and service delivery?

Assessing General Dynamics' past performance on comparable contracts is crucial. Reviewing metrics such as on-time delivery, adherence to budget, system uptime, and incident response times will provide insight into their reliability and efficiency. This historical data can inform whether the current contract's pricing and proposed service levels are justified and if there are any potential performance risks.

How will CMS ensure cost control and prevent scope creep under this Time and Materials contract, given its significant duration and value?

CMS must implement rigorous oversight mechanisms, including detailed work breakdown structures, regular performance reviews, and strict change control processes. Establishing clear performance metrics and key performance indicators (KPIs) tied to payment will be essential. Proactive management and communication with the contractor are vital to identify and address potential cost increases or scope deviations early.

What are the key performance indicators (KPIs) for the HIGLAS system's hosting, operations, and maintenance, and how will they be measured and enforced?

Key performance indicators should focus on system availability (uptime), response times for critical functions, data security compliance, disaster recovery capabilities, and user support efficiency. CMS needs to define specific, measurable, achievable, relevant, and time-bound (SMART) KPIs and establish a clear process for monitoring, reporting, and enforcing them. Penalties for non-performance and incentives for exceeding targets should be considered.

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 › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030

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

Financial Breakdown

Contract Ceiling: $477,228,028

Exercised Options: $146,505,619

Current Obligation: $146,505,619

Actual Outlays: $118,372,086

Subaward Activity

Number of Subawards: 124

Total Subaward Amount: $177,950,638

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0003

IDV Type: GWAC

Timeline