CMS Awards $3.27M Contract to Arch Systems LLC for Medicare/Medicaid Fraud Detection
Contract Overview
Contract Amount: $3,272,264 ($3.3M)
Contractor: Arch Systems LLC
Awarding Agency: Department of Health and Human Services
Start Date: 2025-11-15
End Date: 2026-11-14
Contract Duration: 364 days
Daily Burn Rate: $9.0K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: CMS WILL UTILIZE THIS TASK ORDER AS A PART OF THE OVERALL PROVIDER ENROLLMENT AND OVERSIGHT, INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT (PEO-IDIQ) TO DETECT, PREVENT, AND PROACTIVELY DETER FRAUD, WASTE AND ABUSE IN THE MEDICARE AND/OR MEDICAID
Place of Performance
Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21230
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $3.3 million to ARCH SYSTEMS LLC for work described as: CMS WILL UTILIZE THIS TASK ORDER AS A PART OF THE OVERALL PROVIDER ENROLLMENT AND OVERSIGHT, INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT (PEO-IDIQ) TO DETECT, PREVENT, AND PROACTIVELY DETER FRAUD, WASTE AND ABUSE IN THE MEDICARE AND/OR MEDICAID Key points: 1. Focuses on critical fraud, waste, and abuse prevention in Medicare/Medicaid. 2. Arch Systems LLC, a new awardee, faces competition from established PEO-IDIQ contract holders. 3. Risk of underperformance exists if fraud detection algorithms are not robust. 4. The 'All Other Professional, Scientific, and Technical Services' sector is broad, making direct benchmarks challenging.
Value Assessment
Rating: good
The contract value of $3.27M for a one-year period appears reasonable for specialized fraud detection services. Benchmarking is difficult without specific service details, but it falls within typical ranges for similar technical support contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition after exclusion of sources, indicating a competitive bidding process. This method generally promotes price discovery and ensures fair market value.
Taxpayer Impact: This contract aims to save taxpayer money by preventing fraud, waste, and abuse in Medicare and Medicaid programs.
Public Impact
Improved accuracy in identifying fraudulent claims, potentially saving billions. Enhanced patient protection by ensuring program integrity. Increased efficiency in CMS's oversight and enforcement activities. Potential for more robust data analytics to inform policy decisions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited historical performance data for Arch Systems LLC on this specific PEO-IDIQ.
- Effectiveness hinges on the sophistication of fraud detection technology.
- Potential for scope creep if new fraud schemes emerge rapidly.
Positive Signals
- Leverages an existing IDIQ contract vehicle for streamlined acquisition.
- Focus on proactive deterrence rather than reactive measures.
- Clear objective to protect significant federal healthcare spending.
Sector Analysis
This contract falls under 'All Other Professional, Scientific, and Technical Services,' a broad category. Spending in this area is substantial, but specific benchmarks for fraud detection services are not readily available. CMS's focus on provider enrollment and oversight is a key area for such services.
Small Business Impact
The data indicates this contract was awarded to Arch Systems LLC, and there is no explicit mention of small business participation. Further analysis would be needed to determine if small businesses were subcontracted.
Oversight & Accountability
The contract is part of a larger PEO-IDIQ, suggesting existing oversight mechanisms. However, the effectiveness of oversight will depend on CMS's monitoring of Arch Systems LLC's performance and adherence to contract requirements.
Related Government Programs
- All Other Professional, Scientific, and Technical Services
- Department of Health and Human Services Contracting
- Centers for Medicare and Medicaid Services Programs
Risk Flags
- Potential for vendor lock-in if proprietary technology is used.
- Dependence on the quality and completeness of data provided by CMS.
- Risk of evolving fraud tactics outpacing detection capabilities.
- Challenges in accurately quantifying fraud prevention savings.
Tags
all-other-professional-scientific-and-te, department-of-health-and-human-services, md, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $3.3 million to ARCH SYSTEMS LLC. CMS WILL UTILIZE THIS TASK ORDER AS A PART OF THE OVERALL PROVIDER ENROLLMENT AND OVERSIGHT, INDEFINITE DELIVERY, INDEFINITE QUANTITY CONTRACT (PEO-IDIQ) TO DETECT, PREVENT, AND PROACTIVELY DETER FRAUD, WASTE AND ABUSE IN THE MEDICARE AND/OR MEDICAID
Who is the contractor on this award?
The obligated recipient is ARCH SYSTEMS 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 $3.3 million.
What is the period of performance?
Start: 2025-11-15. End: 2026-11-14.
What is the specific methodology Arch Systems LLC will employ for fraud detection, and how does it compare to industry best practices?
The contract details do not specify Arch Systems LLC's fraud detection methodology. A thorough review would require examining the technical proposal and performance metrics. Best practices often involve a combination of data analytics, machine learning, rule-based systems, and anomaly detection to identify suspicious patterns in provider billing and enrollment data.
What are the key performance indicators (KPIs) for this contract, and how will they be measured to ensure effectiveness in deterring fraud?
Key performance indicators are not detailed in the provided data. Effective KPIs would likely include metrics such as the percentage of fraudulent claims detected, the value of prevented fraud, the false positive rate of detection algorithms, and the timeliness of reporting suspicious activities to CMS for investigation and action.
How will the success of this contract be measured in terms of return on investment (ROI) for taxpayer dollars, considering the cost of the contract versus the amount of fraud prevented?
Measuring ROI requires tracking the direct financial impact of fraud prevented as a result of Arch Systems LLC's services against the contract cost. This involves a robust system for attributing savings to the contractor's efforts, which can be complex. CMS would need to establish baseline fraud levels and monitor reductions attributable to the new system.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 75FCMC26R0008
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1800 WASHINGTON BLVD STE 421, BALTIMORE, MD, 21230
Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Economically Disadvantaged Women Owned Small Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business
Financial Breakdown
Contract Ceiling: $18,912,159
Exercised Options: $3,272,264
Current Obligation: $3,272,264
Actual Outlays: $39,374
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: 75FCMC21D0001
IDV Type: IDC
Timeline
Start Date: 2025-11-15
Current End Date: 2026-11-14
Potential End Date: 2030-11-14 00:00:00
Last Modified: 2026-02-09
More Contracts from Arch Systems LLC
- National Weather Service (NWS) Office of Science and Technology Integration (osti) Meteorological Development Laboratory (MDL) Support Services - Recompete Contract — $8.3M (Department of Commerce)
- THE Anti-Trafficking Information Management System (atims) Incorporated Shepherd AS a Module, Streamlined Reporting and Performance Monitoring VIA the Grant Performance Module, and Improved Access to the System Through the Development of the User MAN — $3.8M (Department of Health and Human Services)
- HHS ACF OHS Monitoring - Digital Services — $2.4M (Department of the Interior)
- Business Architecture Development and Strategic Specification Design (badssd) - Facilitate the Creation, Documentation, and Promotion of an Efficient, Operationally Viable, and Consistent Enterprise Architecture Within Uscis. Exemption 4(A) Infrastru — $2.2M (Department of Homeland Security)
- This IS a Delivery Order to Purchase Link and Learn Taxes and Understanding Taxes Training — $2.0M (Department of the Treasury)
Other Department of Health and Human Services Contracts
- Contact Center Operations (CCO) — $5.5B (Maximus Federal Services, Inc.)
- TAS::75 0849::TAS Oper of Govt R&D Goco Facilities — $4.8B (Leidos Biomedical Research Inc)
- THE Purpose of This Contract IS to Provide the Full Complement of Services Necessary to Care for UC in ORR Custody Including Facilities Set-Up, Maintenance, and Support Internal and Perimeter (IF Applicable) Security, Direct Care and Supervision Inc — $3.5B (Rapid Deployment Inc)
- Contact Center Operations — $2.6B (Maximus Federal Services, Inc.)
- Federal Contract — $2.4B (Leidos Biomedical Research Inc)
View all Department of Health and Human Services contracts →