HHS awards $18.8M contract for patient safety data systems to Cormac Corporation

Contract Overview

Contract Amount: $18,814,826 ($18.8M)

Contractor: Cormac Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2021-08-03

End Date: 2026-09-04

Contract Duration: 1,858 days

Daily Burn Rate: $10.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: PATIENT SAFETY ORGANIZATION PRIVACY PROTECTION CENTER (PSOPPC) AND NETWORK OF PATIENT SAFETY DATABASES (NPSD) SYSTEMS

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $18.8 million to CORMAC CORPORATION for work described as: PATIENT SAFETY ORGANIZATION PRIVACY PROTECTION CENTER (PSOPPC) AND NETWORK OF PATIENT SAFETY DATABASES (NPSD) SYSTEMS Key points: 1. Contract value appears reasonable given the duration and scope of services. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. Potential risks include reliance on a single contractor for critical data systems. 4. The contract supports vital patient safety initiatives within the healthcare sector. 5. This spending aligns with broader federal efforts to improve healthcare quality and safety.

Value Assessment

Rating: good

The contract's total value of $18.8 million over approximately five years (August 2021 to September 2026) suggests a moderate annual spend. Benchmarking against similar IT support contracts for federal health agencies indicates this is within a typical range for specialized system maintenance and development. The time and materials pricing structure allows for flexibility but requires diligent oversight to ensure cost-effectiveness. Without specific performance metrics or detailed cost breakdowns, a precise value-for-money assessment is challenging, but the competitive award process provides some assurance.

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 that while initial solicitations might have had specific exclusions, the final award was made through a broad competitive process. The presence of 5 bids suggests a healthy level of interest and competition for this specialized service. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer funds are used efficiently by driving down costs and encouraging innovative solutions from multiple offerors.

Public Impact

The primary beneficiaries are patients, through improved safety measures derived from the data collected and analyzed. The contract delivers essential IT services for the Patient Safety Organization Privacy Protection Center (PSOPPC) and the Network of Patient Safety Databases (NPSD). Services are likely to have a national impact, supporting patient safety efforts across the United States. The contract supports a specialized IT workforce, potentially including software developers, data analysts, and system administrators.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the time and materials pricing model if not closely monitored.
Dependence on a single contractor for critical patient safety data infrastructure.
Ensuring data security and privacy compliance over the contract's lifespan.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Supports a critical government function related to public health and patient safety.
Contract duration provides stability for system development and maintenance.

Sector Analysis

This contract falls within the broader Information Technology (IT) and Healthcare sectors, specifically focusing on data management and analysis for patient safety. The market for health IT services is substantial and growing, driven by increasing digitization of healthcare and a focus on quality improvement. Comparable spending benchmarks would include contracts for health data analytics platforms, electronic health record (EHR) system support, and specialized health IT consulting services. The Agency for Healthcare Research and Quality (AHRQ) is a key player in this space, funding research and initiatives to improve healthcare quality and safety.

Small Business Impact

The data provided does not indicate any specific small business set-aside provisions for this contract, nor does it detail subcontracting plans. As a definitive contract awarded through full and open competition, it is likely that large businesses were the primary bidders. Further analysis would be needed to determine if small businesses are involved in subcontracting opportunities or if there are specific goals for small business participation.

Oversight & Accountability

Oversight for this contract would primarily reside with the Agency for Healthcare Research and Quality (AHRQ), the contracting agency. Mechanisms likely include regular progress reports, performance reviews, and potentially site visits. The time and materials (T&M) pricing structure necessitates close monitoring of labor hours and material costs to ensure accountability and prevent overspending. Transparency is generally maintained through contract award databases, though detailed performance data may be internal.

Related Government Programs

Patient Safety Initiatives
Healthcare Data Analytics
Health Information Technology
Federal Health IT Systems
Agency for Healthcare Research and Quality Programs

Risk Flags

Potential for cost overruns due to T&M pricing.
Reliance on a single vendor for critical infrastructure.
Ensuring data security and privacy compliance.
Measuring the direct impact of IT systems on patient safety outcomes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $18.8 million to CORMAC CORPORATION. PATIENT SAFETY ORGANIZATION PRIVACY PROTECTION CENTER (PSOPPC) AND NETWORK OF PATIENT SAFETY DATABASES (NPSD) SYSTEMS

Who is the contractor on this award?

The obligated recipient is CORMAC CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Agency for Healthcare Research and Quality).

What is the total obligated amount?

The obligated amount is $18.8 million.

What is the period of performance?

Start: 2021-08-03. End: 2026-09-04.

What is the track record of Cormac Corporation with federal contracts, particularly within the Department of Health and Human Services?

Cormac Corporation has a history of federal contracting, including work with the Department of Health and Human Services (HHS). Reviewing past performance evaluations and contract histories for Cormac Corporation would provide insight into their reliability, quality of work, and adherence to schedules and budgets on previous government projects. Specific details on their performance on similar IT or data management contracts would be particularly relevant for assessing their suitability for the PSOPPC and NPSD systems. A thorough review would involve examining contract close-out reports, any documented disputes or awards, and feedback from previous contracting officers to gauge their overall performance profile.

How does the annual spending on this contract compare to similar federal contracts for patient safety data systems?

The approximate annual spend for this contract, derived from its total value ($18.8M) and duration (approx. 5 years), is roughly $3.76 million per year. To benchmark this, one would compare it to contracts awarded by agencies like HHS, CMS, or CDC for managing patient safety databases, health informatics platforms, or related IT infrastructure. Factors such as system complexity, user base size, data volume, and the specific services required (e.g., development, maintenance, analytics) influence costs. If comparable contracts for similar scope and complexity are significantly lower or higher, it would indicate potential overpricing or underfunding, respectively. However, the 'full and open competition' suggests market forces have likely influenced the pricing.

What are the primary risks associated with the 'time and materials' pricing structure for this contract?

The primary risk associated with a 'time and materials' (T&M) pricing structure is the potential for cost overruns if not managed diligently. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours and material costs incurred. This can lead to unpredictable expenditures for the government, especially if project scope creeps or inefficiencies arise. Effective oversight, including detailed tracking of hours, validation of material costs, and clear task definitions, is crucial to mitigate these risks. Without robust monitoring, the government may end up paying more than anticipated for the services rendered, potentially impacting the overall value for money.

How effective are the current PSOPPC and NPSD systems in achieving their patient safety goals, and how will this contract contribute to their effectiveness?

The effectiveness of the PSOPPC and NPSD systems is crucial for improving patient safety nationwide. This contract's objective is to provide the necessary IT support, maintenance, and potentially development for these systems. Their effectiveness is measured by their ability to collect, analyze, and disseminate critical patient safety data, leading to actionable insights that reduce medical errors and adverse events. The contractor's role is to ensure the systems are operational, secure, and capable of handling the required data loads. Success will be judged by the systems' uptime, data integrity, the timely delivery of analytical reports, and ultimately, the demonstrable impact on reducing patient harm as evidenced by broader healthcare quality metrics.

What has been the historical spending trend for patient safety data systems within HHS or AHRQ?

Analyzing historical spending trends for patient safety data systems within HHS or AHRQ provides context for the current $18.8 million award. This involves examining budgets allocated to similar IT infrastructure, data management platforms, and analytical tools over the past several fiscal years. Trends might show increasing investment due to a greater emphasis on data-driven healthcare quality improvement, or stable spending if existing systems are mature. Understanding these patterns helps assess whether the current contract represents a significant increase or decrease in investment, and whether it aligns with the agency's strategic priorities and overall budget.

What specific performance metrics are likely being used to evaluate Cormac Corporation's success under this contract?

Performance metrics for this contract would likely focus on the operational availability and reliability of the PSOPPC and NPSD systems. Key Performance Indicators (KPIs) could include system uptime percentages, response times for data queries, data accuracy and completeness rates, and the timeliness of report generation. For development aspects, metrics might involve adherence to project schedules and budget, and the successful implementation of new features or system upgrades. Security compliance and adherence to privacy regulations would also be critical evaluation points. These metrics ensure the contractor meets the technical and functional requirements necessary for effective patient safety data management.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: AHRQ-21-10008

Offers Received: 5

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 7008 SECURITY BLVD STE 100, BALTIMORE, MD, 21244

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $18,814,826

Exercised Options: $18,814,826

Current Obligation: $18,814,826

Actual Outlays: $15,017,874

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline