Department of Labor's $85M contract for OWCP bill processing and service authorization awarded to Conduent Federal Solutions LLC

Contract Overview

Contract Amount: $85,170,609 ($85.2M)

Contractor: Conduent Federal Solutions LLC

Awarding Agency: Department of Labor

Start Date: 2013-03-30

End Date: 2016-09-30

Contract Duration: 1,280 days

Daily Burn Rate: $66.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CT::IGF - TO PROVIDE EFFICIENCY AND CONSISTENCY IN MEETING STRATEGIC OBJECTIVES, OWCP REQUIRES CONTINUED CONTRACTOR SERVICES TO: PROCESS BILLS FOR THREE OWCP PROGRAMS, SUPPORT PRIOR AUTHORIZATION OF SERVICES IN AT LEAST TWO PROGRAMS, AND RESPOND TO INQUIRIES RELATED TO MEDICAL SERVICES FROM CLAIMANTS AND PROVIDERS.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20210

State: District of Columbia Government Spending

Plain-Language Summary

Department of Labor obligated $85.2 million to CONDUENT FEDERAL SOLUTIONS LLC for work described as: IGF::CT::IGF - TO PROVIDE EFFICIENCY AND CONSISTENCY IN MEETING STRATEGIC OBJECTIVES, OWCP REQUIRES CONTINUED CONTRACTOR SERVICES TO: PROCESS BILLS FOR THREE OWCP PROGRAMS, SUPPORT PRIOR AUTHORIZATION OF SERVICES IN AT LEAST TWO PROGRAMS, AND RESPOND TO INQUIRIES RELATED TO MEDIC… Key points: 1. The contract supports critical functions for three OWCP programs, including bill processing and prior authorization. 2. Conduent Federal Solutions LLC is the sole awardee, indicating a lack of competition. 3. The contract's duration and fixed-price nature suggest potential for cost overruns if not managed effectively. 4. The sector involves insurance-related activities, a common area for government contracting.

Value Assessment

Rating: fair

The contract value of $85.2 million over approximately 3.5 years appears reasonable for the scope of services, which include processing bills and authorizing services for multiple programs. Benchmarking against similar government contracts for claims processing and administrative support would provide a clearer picture of its cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, suggesting it was awarded on a sole-source basis. This limits price discovery and potentially leads to higher costs compared to a competitive procurement. The rationale for not competing the contract needs further examination.

Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these essential administrative services.

Public Impact

Ensures continued processing of medical bills for injured workers, maintaining essential benefits. Supports prior authorization of services, potentially controlling healthcare costs within the OWCP programs. Responds to inquiries from claimants and providers, facilitating access to information and services. Impacts a significant number of individuals relying on OWCP for medical treatment and compensation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for cost inefficiencies due to sole-source award
Long contract duration without clear performance metrics

Positive Signals

Provides essential services for critical government programs
Fixed-price contract can offer cost predictability if scope is well-defined

Sector Analysis

This contract falls within the 'All Other Insurance Related Activities' sector. Government spending in this area often focuses on administrative processing, claims management, and support services for various insurance programs, including workers' compensation.

Small Business Impact

There is no indication in the provided data that small businesses were involved in this contract, either as prime contractors or subcontractors. Further investigation would be needed to determine if opportunities were missed.

Oversight & Accountability

Oversight of this sole-source contract is crucial to ensure that Conduent Federal Solutions LLC is delivering services effectively and at a fair price. The Department of Labor's Inspector General should monitor performance and costs closely.

Related Government Programs

All Other Insurance Related Activities
Department of Labor Contracting
Office of the Assistant Secretary for Administration and Management Programs

Risk Flags

Lack of competitive bidding
Potential for inflated pricing
Risk of vendor lock-in
Limited transparency in cost justification
Dependency on a single contractor for critical functions

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $85.2 million to CONDUENT FEDERAL SOLUTIONS LLC. IGF::CT::IGF - TO PROVIDE EFFICIENCY AND CONSISTENCY IN MEETING STRATEGIC OBJECTIVES, OWCP REQUIRES CONTINUED CONTRACTOR SERVICES TO: PROCESS BILLS FOR THREE OWCP PROGRAMS, SUPPORT PRIOR AUTHORIZATION OF SERVICES IN AT LEAST TWO PROGRAMS, AND RESPOND TO INQUIRIES RELATED TO MEDICAL SERVICES FROM CLAIMANTS AND PROVIDERS.

Who is the contractor on this award?

The obligated recipient is CONDUENT FEDERAL SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $85.2 million.

What is the period of performance?

Start: 2013-03-30. End: 2016-09-30.

What was the justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?

The provided data indicates the contract was 'NOT COMPETED.' A sole-source award typically occurs when only one responsible source can provide the required supplies or services. Justifications often include urgency, unique capabilities, or lack of market research. Without further documentation, it's unclear if alternatives were explored or if this was a necessary exception to full and open competition.

How does the per-unit cost of processing bills and authorizing services under this contract compare to industry benchmarks or previous contracts?

The data does not provide per-unit cost information, making direct comparison difficult. The total contract value of $85.2 million over 1280 days (approx. 3.5 years) for processing bills and authorizing services across three programs suggests a significant operational undertaking. A detailed cost-benefit analysis, including unit costs, would be necessary to assess efficiency against industry standards.

What mechanisms are in place to ensure the effectiveness and efficiency of Conduent Federal Solutions LLC's services, particularly given the lack of competition?

Effectiveness and efficiency are typically ensured through robust contract performance management, including Service Level Agreements (SLAs), Key Performance Indicators (KPIs), and regular reporting. For sole-source contracts, heightened oversight from the contracting officer and potentially the agency's Inspector General is critical to ensure value for money and prevent potential complacency or cost creep.

Industry Classification

NAICS: Finance and Insurance › Agencies, Brokerages, and Other Insurance Related Activities › All Other Insurance Related Activities

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Conduent State & Local Solutions Inc. (UEI: 080342931)

Address: 8260 WILLOW OAK CORPORATE DR, FAIRFAX, VA, 22031

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

Financial Breakdown

Contract Ceiling: $96,517,796

Exercised Options: $96,517,796

Current Obligation: $85,170,609

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline