Medicare Shared Savings Program analysis shows $43.5M spent on ACO program support

Contract Overview

Contract Amount: $43,511,367 ($43.5M)

Contractor: Research Triangle Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2011-09-30

End Date: 2017-07-31

Contract Duration: 2,131 days

Daily Burn Rate: $20.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS FOR THE MEDICASE SHARED SAVINGS PROGRAM

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27709

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $43.5 million to RESEARCH TRIANGLE INSTITUTE for work described as: ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS FOR THE MEDICASE SHARED SAVINGS PROGRAM Key points: 1. Contract focused on administrative and management consulting for ACO program. 2. Significant investment in program analysis suggests a need for ongoing evaluation. 3. Long contract duration (2011-2017) indicates sustained support requirements. 4. Research Triangle Institute has a substantial contract value, implying significant scope. 5. The contract's focus on administrative management aligns with program operational needs. 6. Performance context is crucial to understand the value derived from this investment. 7. Sector positioning within healthcare administration highlights the importance of ACOs.

Value Assessment

Rating: good

The contract value of $43.5M over approximately six years for administrative and management consulting services for the Medicare Shared Savings Program appears reasonable given the complexity and scale of such a program. Benchmarking against similar large-scale program analysis contracts within HHS would provide a more precise value-for-money assessment. The 'time and materials' pricing structure, while common, necessitates careful oversight to ensure efficiency and prevent cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process is generally expected to yield better pricing and service quality. The fact that it was a single award (no=1) suggests that Research Triangle Institute was selected as the most qualified bidder based on technical merit and price.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more cost-effective solutions and prevent price gouging.

Public Impact

Beneficiaries: Patients within the Medicare system who are part of Accountable Care Organizations (ACOs) may benefit from improved care coordination and quality outcomes facilitated by the program analysis. Services Delivered: The contract supported administrative management and general management consulting services, crucial for the operational success and evaluation of the Medicare Shared Savings Program. Geographic Impact: The program's impact is national, affecting Medicare beneficiaries across the United States. Workforce Implications: The contract likely supported a team of analysts and consultants, contributing to employment in the healthcare consulting sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in 'time and materials' contracts if not tightly managed.
Ensuring the consulting services directly translate to measurable improvements in ACO performance.
Dependency on a single contractor for critical program analysis over an extended period.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Significant contract value indicates a high level of trust and perceived capability of the contractor.
Long contract duration implies successful performance and continued need for services.

Sector Analysis

This contract falls within the healthcare administration and consulting sector, specifically supporting the Centers for Medicare and Medicaid Services (CMS) in managing the Accountable Care Organization (ACO) initiative. The ACO program aims to improve healthcare quality and reduce costs by incentivizing providers to coordinate care. Spending in this area reflects the government's investment in program evaluation and operational support for large-scale healthcare reforms. Comparable spending might include other large federal contracts for program management, policy analysis, and data analytics within HHS.

Small Business Impact

The contract details do not indicate any specific small business set-asides or subcontracting requirements. Given the nature of the services (complex administrative and management consulting) and the large contract value, it is possible that the prime contractor, Research Triangle Institute, is a large business. Further investigation would be needed to determine if any subcontracting opportunities were made available to small businesses.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS), a division of the Department of Health and Human Services. Mechanisms likely included regular performance reviews, milestone tracking, and financial audits. Transparency is generally facilitated through contract award databases and public reporting on program outcomes. The Inspector General of HHS would have jurisdiction for investigating any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Medicare Shared Savings Program
Accountable Care Organizations
Centers for Medicare and Medicaid Services Initiatives
Healthcare Program Management Support
Federal Health IT Consulting

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Ensuring long-term relevance and impact of analytical deliverables.
Contractor performance variability over the extended duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $43.5 million to RESEARCH TRIANGLE INSTITUTE. ACCOUNTABLE CARE ORGANIZATION PROGRAM ANALYSIS FOR THE MEDICASE SHARED SAVINGS PROGRAM

Who is the contractor on this award?

The obligated recipient is RESEARCH TRIANGLE INSTITUTE.

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 $43.5 million.

What is the period of performance?

Start: 2011-09-30. End: 2017-07-31.

What specific deliverables were expected from Research Triangle Institute under this contract?

While the specific deliverables are not detailed in the provided data, contracts for administrative management and general management consulting services for a program like the Medicare Shared Savings Program typically involve a range of outputs. These could include analytical reports on ACO performance metrics, recommendations for program improvements, development of operational guidelines, data analysis and interpretation, strategic planning support, and potentially the creation of tools or frameworks to aid CMS in managing the program. The 'time and materials' pricing suggests that the scope might have evolved, requiring ongoing analysis and support rather than fixed, pre-defined deliverables.

How does the $43.5M contract value compare to other similar program support contracts within HHS?

Comparing the $43.5M contract value requires context on the duration and scope of similar HHS program support contracts. This contract spanned approximately six years (2011-2017), averaging around $7.25M per year. This figure is substantial but may be within the expected range for comprehensive analytical and management support for a major initiative like the Medicare Shared Savings Program, which involves complex financial and clinical data. Benchmarking against contracts for program evaluation, data analytics, and management consulting for other large federal health programs (e.g., Medicaid initiatives, public health programs) would be necessary for a precise comparison. The 'full and open competition' award suggests that this value was deemed competitive at the time of award.

What were the key performance indicators (KPIs) used to evaluate Research Triangle Institute's performance?

The provided data does not specify the Key Performance Indicators (KPIs) used for this contract. However, for a contract supporting the Medicare Shared Savings Program, KPIs would likely focus on the quality and timeliness of analytical reports, the accuracy and utility of data analysis, the effectiveness of recommendations provided for program improvement, and adherence to project timelines and budget. Given the 'time and materials' nature, performance might also be assessed based on the efficiency of consultant hours utilized relative to the value of work produced. CMS would have established specific metrics to ensure the contractor was meeting the program's analytical and operational support needs.

What is the historical spending trend for administrative support of the Medicare Shared Savings Program?

This specific contract represents a significant portion of spending for administrative support of the Medicare Shared Savings Program during its operational years from 2011 to 2017. To understand the broader historical trend, one would need to examine total federal spending allocated to the program's administration and evaluation over time. This includes not only contracts like the one awarded to Research Triangle Institute but also internal staffing costs, other related contracts, and IT infrastructure investments. Analyzing spending patterns before and after this contract period, as well as comparing it to the program's overall budget and outcomes, would provide a more complete picture of the historical financial commitment to its support.

Were there any identified risks or challenges associated with this contract during its performance period?

The provided data does not explicitly list risks or challenges encountered during the performance of this contract. However, common risks associated with large, long-term 'time and materials' consulting contracts include potential for cost overruns if not managed diligently, challenges in ensuring the relevance and impact of analytical work over time, contractor performance variability, and the risk of vendor lock-in. The 'full and open competition' award suggests that initial risks were assessed and mitigated through the procurement process. Ongoing monitoring by CMS would have been crucial to identify and address any emerging issues throughout the contract's duration.

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) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 3040 E CORNWALLIS RD, RESEARCH TRIANGLE PARK, NC, 27709

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

Financial Breakdown

Contract Ceiling: $43,511,367

Exercised Options: $43,511,367

Current Obligation: $43,511,367

Subaward Activity

Number of Subawards: 17

Total Subaward Amount: $7,570,294

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS10F0097L

IDV Type: FSS

Timeline