HHS awarded $21.5M for clinical quality measures support, with competition impacting value

Contract Overview

Contract Amount: $21,501,716 ($21.5M)

Contractor: ICF Esac, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2015-09-02

End Date: 2020-09-01

Contract Duration: 1,826 days

Daily Burn Rate: $11.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Healthcare

Official Description: ELECTRONIC CLINICAL QUALITY MEASURES STANDARDS AND SUPPORT CONTRACT."IGF::CT::IGF"

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $21.5 million to ICF ESAC, LLC for work described as: ELECTRONIC CLINICAL QUALITY MEASURES STANDARDS AND SUPPORT CONTRACT."IGF::CT::IGF" Key points: 1. Contract awarded via full and open competition, suggesting potential for competitive pricing. 2. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed closely. 3. Performance period of 5 years indicates a long-term need for these services. 4. The North American Industry Classification System (NAICS) code 541690 covers a broad range of consulting services. 5. The contract was awarded to a single vendor, ICF ESAC, LLC. 6. The contract's value is moderate within the context of federal IT and consulting services.

Value Assessment

Rating: fair

The contract's total value of $21.5 million over five years averages to approximately $4.3 million annually. Benchmarking this against similar federal contracts for technical consulting and standards development is challenging without more specific service details. However, the Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk, as costs can escalate beyond initial estimates, potentially impacting overall value for money if not rigorously managed. The fixed fee component provides some cost certainty for the contractor's effort.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, specific sources may have been excluded at some stage. The presence of 3 bidders suggests a moderate level of competition. A higher number of bidders typically leads to more competitive pricing and a wider range of innovative solutions. The fact that it was competed at all is a positive sign for price discovery.

Taxpayer Impact: The competitive bidding process, even with a limited number of bidders, likely resulted in a more favorable price for taxpayers compared to a sole-source award. It ensures that the government explored options beyond a single provider.

Public Impact

The Centers for Medicare and Medicaid Services (CMS) benefits from this contract by receiving support for developing and implementing electronic clinical quality measures. This contract supports the delivery of essential services related to healthcare quality improvement and data standards. The geographic impact is national, as CMS operates nationwide, and the standards developed affect healthcare providers across the United States. Workforce implications include the employment of consultants and subject matter experts in healthcare policy, IT, and quality improvement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can lead to cost overruns if not closely monitored.
Limited number of bidders (3) may indicate potential for less competitive pricing than a broader competition.
The contract duration of 5 years requires sustained oversight to ensure continued value and performance.
The broad NAICS code (541690) might obscure the specific nature of services, making detailed performance assessment harder.

Positive Signals

Awarded through full and open competition, indicating an effort to secure the best value.
The contract has a defined period of performance, allowing for structured evaluation.
The fixed fee component provides a baseline for contractor compensation, limiting unpredictable profit.
The contract supports critical healthcare quality initiatives for CMS.

Sector Analysis

This contract falls within the Scientific and Technical Consulting Services sector, specifically related to healthcare quality standards and IT implementation. The federal government is a significant purchaser of such services to support policy development, regulatory compliance, and program management. Comparable spending benchmarks are difficult to establish without more granular detail on the specific technical expertise required, but consulting services represent a substantial portion of federal IT and administrative spending.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions or subcontracting requirements for this contract. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting.

Oversight & Accountability

Oversight for this contract would primarily reside with the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. Accountability measures are typically embedded within the contract's terms and conditions, including performance metrics, reporting requirements, and payment schedules tied to deliverables. Transparency is facilitated through federal contract databases like FPDS-NG, where basic contract information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Electronic Health Records (EHR) Incentive Programs
Quality Payment Program (QPP)
Health Information Technology for Economic and Clinical Health (HITECH) Act initiatives
Healthcare Quality Improvement Programs
Federal Health IT Standards Development

Risk Flags

Potential for cost overruns due to CPFF contract type.
Moderate competition level may limit optimal price discovery.
Risk of technological obsolescence over the 5-year performance period.
Broad NAICS code limits specificity in service assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $21.5 million to ICF ESAC, LLC. ELECTRONIC CLINICAL QUALITY MEASURES STANDARDS AND SUPPORT CONTRACT."IGF::CT::IGF"

Who is the contractor on this award?

The obligated recipient is ICF ESAC, LLC.

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 $21.5 million.

What is the period of performance?

Start: 2015-09-02. End: 2020-09-01.

What specific technical expertise does ICF ESAC, LLC bring to the Electronic Clinical Quality Measures Standards and Support contract?

While the provided data does not detail ICF ESAC, LLC's specific technical expertise, contracts for Electronic Clinical Quality Measures (eCQMs) typically require deep knowledge in healthcare informatics, data standards (like HL7, FHIR), clinical workflows, quality improvement methodologies, and regulatory compliance within the Centers for Medicare and Medicaid Services (CMS) framework. Expertise in software development, data analysis, and technical writing is also crucial for developing standards, creating documentation, and providing support to measure developers and healthcare providers. ICF ESAC, LLC, as a contractor in this space, likely possesses a team with a blend of clinical, technical, and policy expertise to address the complex requirements of eCQM development and implementation.

How does the Cost Plus Fixed Fee (CPFF) contract structure compare to other contract types in terms of value for money for this type of service?

The Cost Plus Fixed Fee (CPFF) contract type is often used when the scope of work is not precisely defined or involves research and development, making it suitable for evolving technical consulting. For value for money, CPFF presents a mixed bag. The 'cost-plus' element means the government reimburses the contractor's allowable costs, which can lead to cost overruns if not managed diligently. However, the 'fixed fee' provides the contractor with a predetermined profit margin, incentivizing efficiency to complete the work within the estimated cost. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility but less cost certainty for the government. Compared to Cost Plus Incentive Fee (CPIF), it lacks direct financial incentives for exceeding performance targets, potentially offering less upside for exceptional performance but also less risk of runaway profits.

What are the potential risks associated with a 5-year contract for clinical quality measure support?

A 5-year contract for clinical quality measure support carries several potential risks. Firstly, technological obsolescence is a significant concern; the IT landscape and healthcare standards can evolve rapidly, potentially making the contracted services or developed standards outdated before the contract term ends. Secondly, scope creep is a risk, where the requirements may expand beyond the original intent, leading to increased costs and delays, especially with a CPFF structure. Thirdly, contractor performance degradation over time is possible if motivation wanes or key personnel depart. Finally, market changes or shifts in healthcare policy could render the contracted services less relevant or necessitate a complete pivot, which a long-term contract might not easily accommodate without costly modifications.

How does the level of competition (3 bidders) for this contract likely influence the final price paid by the government?

With three bidders, the competition level for this contract is moderate. While it is better than a sole-source award, it is less competitive than scenarios involving five or more bidders. A moderate number of bidders generally suggests that the government received multiple proposals and had options to choose from, which typically drives prices down from what might be offered in a sole-source situation. However, the degree to which price was optimized depends on the specific nature of the required expertise and the number of qualified firms capable of bidding. It's plausible that the government secured a reasonably competitive price, but there might have been further savings achievable with a larger pool of interested and capable contractors.

What are the implications of the NAICS code 541690 ('Other Scientific and Technical Consulting Services') for understanding this contract's specific function?

The NAICS code 541690 is very broad and encompasses a wide array of scientific and technical consulting services that do not fit into more specific categories. For this contract, it indicates that the services provided by ICF ESAC, LLC are related to expert advice and technical assistance in scientific or technical fields. However, its generality means that without further details from the contract description or statement of work, it's difficult to pinpoint the exact nature of the work. It could range from environmental consulting to engineering support to, as in this case, healthcare policy and IT standards development. This broad classification can sometimes make it challenging to perform precise benchmarking against peer contracts or to assess the specialized nature of the services rendered.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Scientific and Technical Consulting 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

Solicitation ID: RFPCMS2015151078

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 530 GAITHER RD STE 500, ROCKVILLE, MD, 20850

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,501,716

Exercised Options: $21,501,716

Current Obligation: $21,501,716

Actual Outlays: $7,911

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline