HHS Awards $71.7M for Pharmacy Claims Switching to Change Healthcare, Serving Great Plains IHS Facilities

Contract Overview

Contract Amount: $71,732 ($71.7K)

Contractor: Change Healthcare Operations, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2026-04-10

End Date: 2031-01-12

Contract Duration: 1,738 days

Daily Burn Rate: $41/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: FIRM FIXED-PRICE, NON-PERSONAL SERVICE, COMMERCIAL ITEM ACQUISITION TO PROVIDE PHARMACY CLAIMS SWITCHING FOR MULTIPLE GREAT PLAINS AREA INDIAN HEALTH SERVICE (IHS) HEALTHCARE FACILITIES LOCATED THROUGHOUT NORTH DAKOTA AND SOUTH DAKOTA.

Place of Performance

Location: ABERDEEN, BROWN County, SOUTH DAKOTA, 57401

State: South Dakota Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $71,732.33 to CHANGE HEALTHCARE OPERATIONS, LLC for work described as: FIRM FIXED-PRICE, NON-PERSONAL SERVICE, COMMERCIAL ITEM ACQUISITION TO PROVIDE PHARMACY CLAIMS SWITCHING FOR MULTIPLE GREAT PLAINS AREA INDIAN HEALTH SERVICE (IHS) HEALTHCARE FACILITIES LOCATED THROUGHOUT NORTH DAKOTA AND SOUTH DAKOTA. Key points: 1. The contract focuses on pharmacy claims switching for IHS facilities in North and South Dakota. 2. Change Healthcare Operations, LLC is the sole awardee. 3. The acquisition method is Firm Fixed Price, indicating defined costs. 4. This is a non-personal service, commercial item acquisition.

Value Assessment

Rating: good

The firm fixed-price contract type provides cost certainty. Benchmarking against similar pharmacy claims processing contracts would be beneficial to fully assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process that should have driven favorable pricing. The specific pricing details and number of bidders are not provided.

Taxpayer Impact: Taxpayer funds are being used for essential healthcare IT services to improve pharmacy claims processing efficiency for IHS facilities.

Public Impact

Improved efficiency in processing pharmacy claims for Native American healthcare facilities. Potential for cost savings through streamlined claims switching. Ensures continuity of essential pharmacy services for patients in North and South Dakota.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed pricing information for granular analysis.
Limited insight into the competitive landscape beyond 'full and open'.

Positive Signals

Firm fixed-price contract offers cost predictability.
Commercial item acquisition can lead to faster deployment and potentially lower costs.
Focus on a specific geographic region (Great Plains) for targeted service delivery.

Sector Analysis

This contract falls within the IT services sector, specifically related to healthcare software and data processing. Spending benchmarks for pharmacy claims switching services vary widely based on the scope and number of facilities served.

Small Business Impact

The data does not indicate any specific set-asides for small businesses. The awardee, Change Healthcare Operations, LLC, is a large entity, suggesting limited direct opportunities for small businesses in this specific contract.

Oversight & Accountability

The Department of Health and Human Services, through the Indian Health Service, is responsible for oversight. The firm fixed-price nature of the contract provides a degree of accountability for the contractor to deliver services within the agreed-upon cost.

Related Government Programs

Software Publishers
Department of Health and Human Services Contracting
Indian Health Service Programs

Risk Flags

Potential for vendor lock-in with a single provider for critical IT infrastructure.
Dependence on Change Healthcare's system stability and security.
Risk of scope creep or unforeseen technical challenges impacting cost and timeline.
Limited transparency into the competitive bidding process beyond the awardee.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $71,732.33 to CHANGE HEALTHCARE OPERATIONS, LLC. FIRM FIXED-PRICE, NON-PERSONAL SERVICE, COMMERCIAL ITEM ACQUISITION TO PROVIDE PHARMACY CLAIMS SWITCHING FOR MULTIPLE GREAT PLAINS AREA INDIAN HEALTH SERVICE (IHS) HEALTHCARE FACILITIES LOCATED THROUGHOUT NORTH DAKOTA AND SOUTH DAKOTA.

Who is the contractor on this award?

The obligated recipient is CHANGE HEALTHCARE OPERATIONS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $71,732.33.

What is the period of performance?

Start: 2026-04-10. End: 2031-01-12.

What is the specific per-unit cost or cost per claim processed under this contract, and how does it compare to industry averages for similar services?

The provided data does not include per-unit cost metrics or cost per claim. To assess value effectively, a detailed breakdown of pricing against industry benchmarks for pharmacy claims switching services would be necessary. This would allow for a more precise evaluation of whether the $71.7 million award represents a cost-effective solution for the IHS.

What were the key evaluation criteria used during the full and open competition, and how did Change Healthcare Operations, LLC's proposal specifically meet or exceed these criteria?

The provided data states the contract was awarded under full and open competition but does not detail the evaluation criteria or the specifics of Change Healthcare's winning proposal. Understanding these factors is crucial for assessing the risk associated with the award and ensuring the selection was based on the best overall value, not just the lowest price.

How will the effectiveness of the pharmacy claims switching service be measured and reported throughout the contract period to ensure optimal patient care and operational efficiency?

The data does not specify performance metrics or reporting mechanisms for this contract. To ensure effectiveness, the IHS should establish clear Key Performance Indicators (KPIs) related to claims processing time, accuracy, system uptime, and user satisfaction. Regular performance reviews against these KPIs are essential for accountability and continuous improvement.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Travelport Worldwide Limited

Address: 424 CHURCH ST STE 1400, NASHVILLE, TN, 37219

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $396,366

Exercised Options: $71,732

Current Obligation: $71,732

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F0176X

IDV Type: FSS

Timeline