HHS awards $32M for healthcare software development and maintenance to Software Consultants Inc

Contract Overview

Contract Amount: $32,152,156 ($32.2M)

Contractor: Software Consultants Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2019-08-22

End Date: 2024-09-19

Contract Duration: 1,855 days

Daily Burn Rate: $17.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: SOFTWARE DEVELOPMENT, AUTOMATION, AND MAINTENANCE TO SUPPORT HEALTH CARE, BIOMEDICAL VOCABULARIES, AND STANDARDS

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20892

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $32.2 million to SOFTWARE CONSULTANTS INC for work described as: SOFTWARE DEVELOPMENT, AUTOMATION, AND MAINTENANCE TO SUPPORT HEALTH CARE, BIOMEDICAL VOCABULARIES, AND STANDARDS Key points: 1. Contract focuses on critical health IT infrastructure, including biomedical vocabularies and standards. 2. The contract duration of over 5 years suggests a need for sustained support. 3. A 'full and open competition after exclusion of sources' indicates a specific, though competitive, procurement approach. 4. The use of Time and Materials pricing may present cost control challenges if not closely managed. 5. The awardee, Software Consultants Inc., has a significant contract value, implying substantial experience. 6. The contract is geographically concentrated in Maryland, potentially impacting regional IT employment.

Value Assessment

Rating: good

The contract value of $32.15 million over approximately five years for software development, automation, and maintenance appears reasonable given the scope. Benchmarking against similar IT services contracts for health agencies suggests this falls within a typical range for complex system support. The Time and Materials (T&M) pricing structure, while common for evolving requirements, warrants close monitoring to ensure cost efficiency and prevent scope creep. Without specific performance metrics or detailed cost breakdowns, a precise value-for-money assessment is challenging, but the duration and nature of the work suggest a necessary investment in critical health IT infrastructure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This procurement method suggests that while the competition was intended to be broad, specific circumstances or requirements led to the exclusion of certain potential bidders. The number of bids received (3) indicates a moderate level of competition. This suggests that while multiple firms were likely aware of and capable of bidding, the exclusion criteria may have narrowed the field. The moderate competition could lead to a price that is not as low as it might be under truly unrestricted full and open competition, but it still provides a basis for price discovery.

Taxpayer Impact: Taxpayers benefit from a competitive process that, while not entirely unrestricted, still aims to secure a fair price. The exclusion of sources means that the full potential of the market may not have been leveraged, potentially leading to a slightly higher cost than a completely open bid.

Public Impact

The primary beneficiaries are the National Institutes of Health (NIH) and the broader healthcare and biomedical research community, who will receive enhanced IT support. Services delivered include software development, automation, and ongoing maintenance for critical health IT systems. The geographic impact is concentrated in Maryland, where the contractor is located and likely where much of the work will be performed. This contract supports IT professionals and potentially biomedical informatics specialists, contributing to the health IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not managed diligently.
The 'exclusion of sources' in the competition may limit the breadth of innovation and potentially increase costs.
Long contract duration (over 5 years) requires robust performance monitoring to ensure continued value.
Concentration of work in Maryland could limit opportunities for contractors in other geographic regions.

Positive Signals

Awarded through a competitive process, indicating some level of market vetting.
Supports critical health IT infrastructure, aligning with government priorities.
The contractor has secured a significant award, suggesting established capabilities.
The contract duration implies a stable, long-term need for these services.

Sector Analysis

This contract falls within the broader Information Technology (IT) sector, specifically focusing on software development, automation, and maintenance for healthcare and biomedical applications. The market for health IT services is substantial and growing, driven by the increasing digitization of healthcare records, the need for data analytics, and the development of interoperability standards. Comparable spending benchmarks for large-scale IT support contracts within federal health agencies often range from tens to hundreds of millions of dollars over several years, depending on the complexity and criticality of the systems supported. This contract appears to be a mid-to-large size award within this specialized niche.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss: false' and 'sb: false'. The awardee, Software Consultants Inc., is likely a large business. While there is no direct set-aside, the contract's value and nature might offer subcontracting opportunities for small businesses specializing in specific software development or maintenance tasks. However, without explicit subcontracting plans mandated or reported, the direct impact on the small business ecosystem is uncertain and likely minimal unless the prime contractor actively seeks out small business partners.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting agency, the National Institutes of Health (NIH), a division of HHS. The contract's Time and Materials (T&M) nature necessitates rigorous oversight of labor hours and direct costs to ensure adherence to the contract's ceiling and prevent overspending. Performance monitoring by NIH program managers will be crucial. Inspector General (IG) jurisdiction would apply if any fraud, waste, or abuse is suspected. Transparency is facilitated through contract databases like FPDS, but detailed internal performance reports and cost justifications are typically agency-controlled.

Related Government Programs

Health IT Modernization Programs
Biomedical Data Standards Initiatives
NIH IT Support Services
Healthcare Data Interoperability Projects
Federal Health Information Exchange (HIE)

Risk Flags

Potential for cost overruns due to T&M pricing.
Limited competition due to 'exclusion of sources'.
Need for strong performance monitoring over the long contract duration.
Geographic concentration of work.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $32.2 million to SOFTWARE CONSULTANTS INC. SOFTWARE DEVELOPMENT, AUTOMATION, AND MAINTENANCE TO SUPPORT HEALTH CARE, BIOMEDICAL VOCABULARIES, AND STANDARDS

Who is the contractor on this award?

The obligated recipient is SOFTWARE CONSULTANTS INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $32.2 million.

What is the period of performance?

Start: 2019-08-22. End: 2024-09-19.

What is the track record of Software Consultants Inc. with the federal government, particularly with HHS and NIH?

Software Consultants Inc. has a history of receiving federal contracts, primarily within the Department of Health and Human Services (HHS). This specific contract, valued at over $32 million, represents a significant award and indicates a substantial working relationship. Analyzing past performance on similar contracts would reveal their ability to meet deadlines, manage budgets, and deliver quality software development, automation, and maintenance services. A review of their contract history would also indicate if they have a pattern of cost overruns or performance issues, or conversely, a consistent record of successful project completion. Their ability to secure this large, multi-year contract suggests a generally positive track record and established trust with the agency.

How does the $32.15 million contract value compare to similar IT services contracts for health agencies?

The $32.15 million contract value over approximately five years for comprehensive software development, automation, and maintenance is within the expected range for large-scale IT support within federal health agencies like NIH. Agencies often require substantial investments to maintain and modernize complex health information systems, manage biomedical vocabularies, and ensure data standards compliance. Contracts of this magnitude are typical for supporting critical infrastructure that underpins research, public health initiatives, and data management. While not the largest IT contract awarded by the federal government, it signifies a significant commitment to specialized health IT services, reflecting the ongoing need for robust technological solutions in the healthcare domain.

What are the primary risks associated with the Time and Materials (T&M) pricing structure used in this contract?

The primary risk with a Time and Materials (T&M) pricing structure is the potential for cost escalation if not managed effectively. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours and costs incurred, plus a fixed fee or percentage. This can lead to budget uncertainty and potential overruns if the scope of work expands or if labor hours are not meticulously tracked and justified. For the government, this necessitates strong oversight, detailed reporting requirements, and vigilant program management to ensure that the work performed is necessary, efficient, and stays within the contract's ceiling. Without robust controls, T&M contracts can become more expensive than initially anticipated.

What does 'full and open competition after exclusion of sources' imply about the procurement process and potential cost savings?

The term 'full and open competition after exclusion of sources' indicates a procurement process that began with the intent of broad competition but ultimately excluded certain potential bidders based on specific criteria. This could be due to unique capabilities required, specific security clearances, or other factors that narrowed the eligible pool. While it is a form of competition, it is less broad than unrestricted 'full and open competition.' This means that while multiple bidders (3 in this case) likely competed, the government may not have accessed the entire market's potential for the lowest price. The cost savings might be less than what could have been achieved in a completely unrestricted environment, but it still provides a competitive benchmark.

What is the significance of this contract's duration (1855 days, approx. 5 years) for NIH's IT strategy?

The contract's duration of approximately five years is significant as it signals a long-term strategic commitment by the NIH to the services provided by Software Consultants Inc. This extended period suggests that the software development, automation, and maintenance tasks are critical and ongoing, requiring sustained expertise and support. Such long-term contracts are typical for maintaining complex IT infrastructure, ensuring system stability, and implementing phased upgrades or new functionalities. It allows for deeper integration of the contractor's knowledge into NIH's systems and processes, potentially leading to greater efficiency and continuity. It also provides stability for the contractor, enabling them to invest in specialized resources.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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: RFQ1372548

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 8245 BOONE BLVD STE 630, VIENNA, VA, 22182

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Small Disadvantaged Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,152,156

Exercised Options: $32,152,156

Current Obligation: $32,152,156

Actual Outlays: $23,526,474

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS06F0723Z

IDV Type: GWAC

Timeline