HHS awards $48.1M contract for COVID-19 relief fund disbursement methodology development

Contract Overview

Contract Amount: $48,107,924 ($48.1M)

Contractor: Acumen LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2021-06-18

End Date: 2026-06-17

Contract Duration: 1,825 days

Daily Burn Rate: $26.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: OPS DATA METHODOLOGY AND COMPUTATIONS FOR PROVIDER RELIEF FUND ALLOCATIONS AND TECHNICAL ASSISTANCE IN RESPONSE TO COVID-19. THE PURPOSE OF THIS PROCUREMENT IS TO PURCHASE SERVICES TO DEVELOP PAYMENT DISBURSEMENT METHODOLOGIES, PROCESS APPLICATION DA

Place of Performance

Location: BURLINGAME, SAN MATEO County, CALIFORNIA, 94010

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $48.1 million to ACUMEN LLC for work described as: OPS DATA METHODOLOGY AND COMPUTATIONS FOR PROVIDER RELIEF FUND ALLOCATIONS AND TECHNICAL ASSISTANCE IN RESPONSE TO COVID-19. THE PURPOSE OF THIS PROCUREMENT IS TO PURCHASE SERVICES TO DEVELOP PAYMENT DISBURSEMENT METHODOLOGIES, PROCESS APPLICATION DA Key points: 1. Contract focuses on developing payment disbursement methodologies for the Provider Relief Fund. 2. Acumen LLC, the contractor, will provide administrative management and general management consulting services. 3. The contract duration is five years, indicating a long-term need for these services. 4. The award was made under full and open competition, suggesting a robust bidding process. 5. The fixed-price contract type aims to control costs for the government. 6. This procurement supports the critical function of distributing COVID-19 relief funds.

Value Assessment

Rating: good

The contract value of $48.1 million over five years for developing disbursement methodologies appears reasonable given the complexity and critical nature of the Provider Relief Fund. Benchmarking against similar large-scale federal IT and management consulting contracts suggests that this level of investment is within expected ranges for specialized expertise. The firm-fixed-price structure provides cost certainty, which is a positive indicator for value for money. However, without specific details on the deliverables and the contractor's proposed approach, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were likely solicited and had the opportunity to bid. The presence of full and open competition generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The number of bidders is not specified, but the method of procurement suggests a deliberate effort to ensure a wide range of qualified contractors could participate, thereby promoting price discovery and innovation.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of securing the best possible value by encouraging a wide array of qualified vendors to submit proposals, driving down costs through market forces.

Public Impact

Healthcare providers across the nation will benefit from efficient and accurate disbursement of COVID-19 relief funds. The services delivered will ensure the integrity and effectiveness of the Provider Relief Fund's payment systems. The geographic impact is national, supporting healthcare infrastructure throughout the United States. The contract supports administrative and consulting roles, potentially creating or sustaining jobs in these sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if the initial methodology development requires significant revisions.
Reliance on a single contractor for a critical function could pose a risk if performance issues arise.
Ensuring the chosen methodology is adaptable to future public health crises or funding changes.

Positive Signals

The use of full and open competition suggests a thorough vetting of potential contractors.
The firm-fixed-price contract type helps manage cost overruns.
The five-year duration indicates a commitment to a well-defined and potentially successful solution.

Sector Analysis

This contract falls within the administrative management and general management consulting services sector, specifically supporting government public health initiatives. The market for such services is substantial, driven by the government's ongoing need for expertise in program management, financial operations, and policy implementation, particularly in response to large-scale crises like COVID-19. Comparable spending benchmarks in this sector often involve significant investments for specialized consulting required for complex federal programs.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, large businesses likely dominated the bidding process. There is no explicit information regarding subcontracting plans for small businesses. This means the primary contract is not directly contributing to small business set-aside goals, and the impact on the small business ecosystem will depend on whether Acumen LLC voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract will likely be managed by the Health Resources and Services Administration (HRSA) within HHS. Accountability measures are typically embedded in the contract's performance work statement, with regular reviews and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected in the execution of the contract.

Related Government Programs

Provider Relief Fund
COVID-19 Relief Programs
Federal Payment Systems
Management and Consulting Services
Public Health Funding

Risk Flags

Potential for delays in critical fund disbursement.
Risk of methodology not meeting evolving regulatory requirements.
Integration challenges with existing financial systems.
Contractor performance issues impacting fund distribution.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $48.1 million to ACUMEN LLC. OPS DATA METHODOLOGY AND COMPUTATIONS FOR PROVIDER RELIEF FUND ALLOCATIONS AND TECHNICAL ASSISTANCE IN RESPONSE TO COVID-19. THE PURPOSE OF THIS PROCUREMENT IS TO PURCHASE SERVICES TO DEVELOP PAYMENT DISBURSEMENT METHODOLOGIES, PROCESS APPLICATION DA

Who is the contractor on this award?

The obligated recipient is ACUMEN LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Health Resources and Services Administration).

What is the total obligated amount?

The obligated amount is $48.1 million.

What is the period of performance?

Start: 2021-06-18. End: 2026-06-17.

What is the specific expertise Acumen LLC brings to the development of payment disbursement methodologies?

Acumen LLC's core competency lies in administrative management and general management consulting services, as indicated by their NAICS code (541611). While the provided data doesn't detail specific past projects, contracts of this nature typically require demonstrated experience in financial systems, process optimization, regulatory compliance, and large-scale data management. Acumen LLC would likely leverage its expertise in designing efficient workflows, ensuring data integrity, and developing robust algorithms for fund allocation to meet the complex requirements of the Provider Relief Fund. Their track record in similar government contracts, particularly those involving financial disbursements or complex program administration, would be a key indicator of their suitability for this task.

How does the $48.1 million contract value compare to similar federal procurements for payment system development?

The $48.1 million contract value over five years for developing payment disbursement methodologies is substantial but appears to be within the expected range for complex federal IT and management consulting projects, especially those related to critical public health initiatives. Similar large-scale procurements for developing or overhauling federal payment systems, managing large grant programs, or implementing complex financial regulations can range from tens to hundreds of millions of dollars, depending on the scope, duration, and technological sophistication required. Given the Provider Relief Fund's scale and the need for robust, secure, and compliant disbursement mechanisms in response to an unprecedented crisis, this investment reflects the complexity and importance of the task. The firm-fixed-price nature also suggests a degree of cost control anticipated by the agency.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential delays in methodology development, challenges in integrating the new system with existing financial infrastructure, and ensuring the methodology remains effective and compliant with evolving regulations. There's also a risk of contractor underperformance or failure to deliver the expected outcomes. Mitigation strategies likely include clearly defined performance metrics and milestones within the contract, regular progress reviews by HRSA, and the firm-fixed-price structure which incentivizes the contractor to meet objectives within budget. The five-year duration allows for phased development and testing, reducing the risk of a single point of failure and providing opportunities for course correction.

How effective is the Provider Relief Fund likely to be with the implementation of these new disbursement methodologies?

The effectiveness of the Provider Relief Fund is directly tied to the efficiency and accuracy of its disbursement mechanisms. By awarding this contract for methodology development, the Health Resources and Services Administration (HRSA) aims to enhance the fund's effectiveness. A well-designed methodology should ensure that funds are distributed equitably, reach intended recipients promptly, and comply with all relevant legal and financial regulations. This, in turn, supports healthcare providers in maintaining operations and serving patients during public health emergencies. The success hinges on the quality of the developed methodology and its successful implementation, which this contract is designed to facilitate.

What has been the historical spending pattern for similar administrative and management consulting services by HHS?

HHS historically spends significant amounts on administrative and management consulting services to support its vast array of programs, including public health initiatives, healthcare regulation, and research. Spending patterns vary year to year based on agency priorities, new program launches, and emerging needs, such as pandemic response. Procurements in this category often involve large, multi-year contracts for services ranging from IT modernization and financial management to policy analysis and program evaluation. The $48.1 million awarded to Acumen LLC for this specific task aligns with the agency's established practice of leveraging external expertise for complex operational challenges, particularly those requiring specialized knowledge and rapid development.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Solicitation ID: 75R60221Q00131

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 500 AIRPORT BLVD, BURLINGAME, CA, 94010

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: $53,157,924

Exercised Options: $53,157,924

Current Obligation: $48,107,924

Actual Outlays: $44,631,648

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: GS10F0133S

IDV Type: FSS

Timeline