HHS awarded $14M for TAS Payment Error Rate Measurement Review, with 3 bidders competing

Contract Overview

Contract Amount: $14,035,785 ($14.0M)

Contractor: Healthdatainsights, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2006-09-29

End Date: 2011-11-30

Contract Duration: 1,888 days

Daily Burn Rate: $7.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: TAS::75 8393::TAS PAYMENT ERROR RATE MEASUREMENT REVIEW CONTRACT

Place of Performance

Location: LAS VEGAS, CLARK County, NEVADA, 89128

State: Nevada Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $14.0 million to HEALTHDATAINSIGHTS, INC. for work described as: TAS::75 8393::TAS PAYMENT ERROR RATE MEASUREMENT REVIEW CONTRACT Key points: 1. The contract's cost-plus-award-fee structure incentivizes performance but can lead to higher final costs. 2. With 3 bidders, competition was present but may not have driven the lowest possible price. 3. The contract duration of 1888 days (over 5 years) suggests a long-term need for these services. 4. The service category, Computer Facilities Management Services, is a common requirement across federal agencies. 5. The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating a specific justification for limiting initial bidders. 6. The Nevada location for the contractor may have implications for local economic impact and workforce.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics and comparable contract data. The cost-plus-award-fee (CPAF) pricing model allows for flexibility and incentivizes contractor performance, but it also carries the risk of cost overruns if not managed tightly. The final award amount relative to the initial estimate would provide a clearer picture of value for money. Given the duration and the nature of the services, the price appears within a reasonable range for complex IT management, but detailed cost breakdowns would be needed for a definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under 'Full and Open Competition After Exclusion of Sources,' which suggests that while the competition was intended to be open, certain sources were excluded from the initial bidding process. With three bidders, there was a degree of competition, but the exclusion of sources might have limited the overall competitive landscape. This type of competition can sometimes lead to higher prices compared to unrestricted full and open competition, as the pool of potential offerors was narrowed.

Taxpayer Impact: Taxpayers may have paid a premium due to the limited nature of the competition, as fewer bidders could have resulted in less aggressive pricing. The exclusion of certain sources warrants further investigation to ensure it was justified and did not unduly restrict competition.

Public Impact

The Centers for Medicare and Medicaid Services (CMS) benefits from this contract by receiving support for its critical Payment Error Rate Measurement (PERM) program. Services delivered include computer facilities management, essential for the operation and integrity of CMS's IT infrastructure. The contract's geographic impact is primarily federal, supporting a national agency, though the contractor's physical location is in Nevada. Workforce implications include the employment of IT professionals by the contractor, HealthDataInsights, Inc., to fulfill the contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Full and Open Competition After Exclusion of Sources' designation raises questions about the breadth of competition and potential impact on pricing.
Cost-plus-award-fee contracts require diligent oversight to ensure costs remain reasonable and performance targets are met efficiently.
The long contract duration (over 5 years) necessitates ongoing monitoring to ensure continued relevance and value.

Positive Signals

The presence of three bidders indicates some level of market interest and capability for these specialized services.
The award to HealthDataInsights, Inc. suggests a contractor with relevant expertise in managing complex IT facilities.
The definitive contract award mechanism implies a structured procurement process.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer facilities management. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. Contracts like this are crucial for supporting the operational backbone of agencies like CMS. Comparable spending benchmarks for similar IT management contracts would typically vary based on scope, duration, and specific services required, but this $14 million award over five years represents a significant investment in maintaining critical government IT functions.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract is likely minimal, unless the prime contractor voluntarily engages small businesses in its subcontracting efforts.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Centers for Medicare and Medicaid Services (CMS). The cost-plus-award-fee structure necessitates robust performance monitoring and financial oversight to ensure the contractor meets defined objectives and manages costs effectively. Transparency would be enhanced by public reporting of contract performance and expenditures. While specific Inspector General (IG) jurisdiction is not detailed here, the HHS OIG generally has oversight over CMS programs and contracts.

Related Government Programs

Payment Error Rate Measurement (PERM) Program
Centers for Medicare and Medicaid Services (CMS) IT Infrastructure
Federal IT Services Contracts
Computer Facilities Management Services

Risk Flags

Limited competition due to source exclusion.
Potential for cost overruns inherent in CPAF contracts.
Need for diligent contract oversight due to long duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $14.0 million to HEALTHDATAINSIGHTS, INC.. TAS::75 8393::TAS PAYMENT ERROR RATE MEASUREMENT REVIEW CONTRACT

Who is the contractor on this award?

The obligated recipient is HEALTHDATAINSIGHTS, 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 $14.0 million.

What is the period of performance?

Start: 2006-09-29. End: 2011-11-30.

What was the specific justification for excluding sources in this 'Full and Open Competition After Exclusion of Sources' award?

The provided data does not specify the exact justification for excluding sources. This contract type typically implies that while the competition was open to all responsible sources, certain categories or specific sources were deemed ineligible or unnecessary to solicit, often due to prior performance, specialized capabilities, or specific program requirements. A detailed review of the contract file or procurement justification documents would be necessary to understand the precise reasons for source exclusion. This could range from ensuring continuity of service with an incumbent to acquiring highly specialized technology or services where only a limited number of vendors possess the required expertise.

How does the performance of HealthDataInsights, Inc. on this contract compare to industry benchmarks for IT facilities management?

Assessing HealthDataInsights, Inc.'s performance against industry benchmarks requires access to specific performance metrics and award fee determinations under this contract, which are not publicly available in the provided data. The contract type (Cost Plus Award Fee) suggests that performance was evaluated against defined criteria, and the contractor could earn additional fee based on exceeding expectations. Without these details, a direct comparison is speculative. Generally, IT facilities management benchmarks focus on uptime, response times, security compliance, and cost-efficiency. A thorough analysis would involve reviewing performance reports, customer satisfaction surveys, and any documented deviations from expected service levels.

What were the primary risks associated with this contract, and how were they managed?

Key risks for a contract of this nature and duration (over 5 years) typically include scope creep, cost overruns due to the CPAF structure, technological obsolescence, and contractor performance issues. The 'Exclusion of Sources' aspect also introduces a risk of suboptimal pricing due to potentially limited competition. Risk management would likely involve robust contract surveillance by the government, clear definition and monitoring of performance objectives to control costs and ensure quality, regular technical reviews, and proactive communication channels with the contractor. The CPAF structure itself is a risk mitigation tool, incentivizing the contractor to perform well to earn higher fees, but it requires diligent government oversight to prevent unchecked cost growth.

How does the total spending on TAS Payment Error Rate Measurement Review contracts compare over time?

The provided data only pertains to a single contract awarded to HealthDataInsights, Inc. for $14.04 million, running from 2006 to 2011. To analyze historical spending trends for TAS Payment Error Rate Measurement Review, a broader dataset encompassing all contracts awarded for these services across different agencies and time periods would be necessary. This would allow for the identification of patterns in spending, fluctuations in contract values, and changes in the number and types of contractors involved. Without this broader context, it's impossible to determine if this specific award represents a typical, increased, or decreased level of investment in this area.

What is the significance of the 'Computer Facilities Management Services' NAICS code (541513) in the federal contracting landscape?

The NAICS code 541513, 'Computer Facilities Management Services,' is highly significant in the federal contracting landscape as it represents a core IT service category essential for government operations. Agencies rely heavily on these services for the day-to-day management, maintenance, and operation of their computer systems, data centers, and related infrastructure. This code encompasses a wide range of activities, including network management, system administration, data storage, and IT support. Federal spending in this category is consistently substantial, reflecting the ongoing need for robust and secure IT environments to support agency missions. Contracts under this code are prevalent across nearly all federal departments and agencies.

Industry Classification

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

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: HMS Holdings Corp.

Address: 2620 REGATTA DR, LAS VEGAS, NV, 89128

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $14,035,785

Exercised Options: $14,035,785

Current Obligation: $14,035,785

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline