HHS awards $64.4M to General Dynamics for IT services over 11 years

Contract Overview

Contract Amount: $64,370,593 ($64.4M)

Contractor: General Dynamics Information Technology, Inc

Awarding Agency: Department of Health and Human Services

Start Date: 1999-05-14

End Date: 2010-12-01

Contract Duration: 4,219 days

Daily Burn Rate: $15.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $64.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC for work described as: Key points: 1. Significant long-term contract for IT services. 2. General Dynamics has a strong track record. 3. Potential for cost overruns with Cost Plus Fixed Fee. 4. IT sector is highly competitive.

Value Assessment

Rating: fair

The contract spans over 11 years, making direct pricing comparisons difficult. The Cost Plus Fixed Fee structure can lead to costs exceeding initial estimates if not managed carefully.

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. However, the long duration might have allowed for price adjustments over time.

Taxpayer Impact: Over $64 million in taxpayer funds were allocated for this long-term IT support.

Public Impact

Ensures continuity of critical IT services for Medicare and Medicaid. Supports the operational infrastructure of vital healthcare programs. Long-term commitment may impact flexibility for adopting new technologies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration
Cost Plus Fixed Fee pricing
Lack of specific performance metrics in provided data

Positive Signals

Full and open competition
Established contractor
Long-term service provision

Sector Analysis

This contract falls within the Information Technology sector, specifically supporting healthcare administration. IT spending in government is substantial, with a focus on modernization and data management.

Small Business Impact

The data indicates the awardee is General Dynamics Information Technology, Inc., a large business. There is no indication of small business participation in this specific award.

Oversight & Accountability

Oversight would typically involve regular performance reviews and financial audits by HHS to ensure the contractor meets requirements and manages costs effectively.

Related Government Programs

Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Long contract duration may lead to outdated technology.
Cost Plus Fixed Fee structure carries risk of cost overruns.
Lack of specific performance metrics in summary data.
Potential for vendor lock-in over an extended period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $64.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Medicare and Medicaid Services).

What is the total obligated amount?

The obligated amount is $64.4 million.

What is the period of performance?

Start: 1999-05-14. End: 2010-12-01.

What were the key performance indicators (KPIs) used to evaluate General Dynamics' performance throughout the contract's 11-year duration?

The provided data does not specify the key performance indicators (KPIs) used. Effective oversight would require clearly defined KPIs related to system uptime, response times, security compliance, and user satisfaction to ensure the value of the $64.4 million investment.

How did the Cost Plus Fixed Fee structure impact the final cost compared to a fixed-price contract for similar IT services?

A Cost Plus Fixed Fee contract allows the contractor to recover costs plus a predetermined fee. This structure can lead to higher final costs than a fixed-price contract if costs escalate unexpectedly, as the government bears the risk of cost overruns beyond the fixed fee.

What mechanisms were in place to ensure the Centers for Medicare and Medicaid Services received competitive pricing for IT services over such an extended period?

While awarded under full and open competition, the 11-year duration necessitates mechanisms like periodic price reviews or option periods with re-negotiation clauses. Without these, the government risks paying above-market rates as technology and market conditions evolve.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 15245 SHADY GROVE RD STE 200, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $64,370,593

Exercised Options: $64,370,593

Current Obligation: $64,370,593

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 500990015

IDV Type: IDC

Timeline