CMS Awards Deloitte $23.3M for Medicare Payment Accuracy Validation

Contract Overview

Contract Amount: $23,336,393 ($23.3M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Health and Human Services

Start Date: 2015-09-15

End Date: 2019-03-14

Contract Duration: 1,276 days

Daily Burn Rate: $18.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: Healthcare

Official Description: IGF::OT::IGF RADV AWARD THE CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) CURRENTLY UNDERTAKES MANY ACTIVITIES TO VALIDATE THE INPUTS AND OUTPUTS OF MEDICARE PARTS C AND D PAYMENTS TO ASSURE PAYMENT ACCURACY. FOR THE PURPOSES OF THIS CONTRACT, THE FOCUS WILL BE ON SERVING AS THE LEAD ANALYTICAL CONTRACTOR FOR RISK ADJUSTMENT DATA VALIDATION (RADV) ACTIVITIES. CMS CONDUCTS TWO TYPES OF RADV ACTIVITIES 1) A NATIONAL PAYMENT ERROR ESTIMATE TO COMPLY WITH THE IMPROPER PAYMENT&INFORMATION ACT (IPIA) OF 2002, AS AMENDED BY BOTH THE IMPROPER PAYMENTS ELIMINATION AND RECOVERY ACT (IPERA) OF 2010 AND THE IMPROPER PAYMENTS ELIMINATION AND RECOVERY IMPROVEMENT ACT OF 2012 (FOR THE PURPOSES OF THIS AWARD, THE COMBINATION OF THESE STATUTES IS HEREIN REFERRED TO AS IPIA/IPERA); AND 2) CONTRACT-LEVEL RADV AUDITS FOR PAYMENT RECOVERY PURPOSES.THE LEAD ANALYTIC CONTRACTOR (LAC) WILL COORDINATE THE OVERALL ANALYTIC APPROACH AND PROCESS FOR RADV ACTIVITIES. THIS WILL INVOLVE SAMPLING, ANALYSIS, DEVELOPING REPORTS, CALCULATING INITIAL AND FINAL PAYMENT ERROR ESTIMATES, WORKING WITH THE INTAKE EVALUATION AND MEDICAL RECORD REVIEW CONTRACTORS (IMRRCS AND MRRCS) REGARDING CMS AND MAO CDAT APPLICATIONS, AND MANAGING PROJECT DATA. THE LAC WILL ALSO TRAIN CMS, ITS CONTRACTORS AND MAO CDAT USERS ON THE RADV PROCESS AS IT RELATES TO DATA AND ANALYSIS.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $23.3 million to DELOITTE CONSULTING LLP for work described as: IGF::OT::IGF RADV AWARD THE CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) CURRENTLY UNDERTAKES MANY ACTIVITIES TO VALIDATE THE INPUTS AND OUTPUTS OF MEDICARE PARTS C AND D PAYMENTS TO ASSURE PAYMENT ACCURACY. FOR THE PURPOSES OF THIS CONTRACT, THE FOCUS WILL BE ON SERVING AS … Key points: 1. Contract focuses on Risk Adjustment Data Validation (RADV) for Medicare Parts C & D. 2. Deloitte Consulting LLP is the awardee, a major player in management consulting. 3. The contract aims to ensure payment accuracy and comply with federal improper payment laws. 4. This is a delivery order under a larger contract, indicating a specific task assignment.

Value Assessment

Rating: good

The contract value of $23.3M over approximately 4 years appears reasonable for complex data validation services. Benchmarking against similar large-scale data analytics contracts for government agencies would provide further context.

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. This method generally promotes price discovery and potentially better value for the government.

Taxpayer Impact: Ensuring payment accuracy in Medicare Parts C & D helps prevent improper payments, directly benefiting taxpayers by safeguarding federal funds.

Public Impact

Improved accuracy in Medicare payments protects taxpayer dollars. Enhanced data validation can lead to more reliable healthcare program outcomes. The contract supports critical functions of the Centers for Medicare and Medicaid Services. Deloitte's expertise in consulting will be applied to a vital public health program.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in complex data validation tasks.
Reliance on a single contractor for critical payment validation.
Ensuring data integrity and security throughout the contract lifecycle.

Positive Signals

Awarded under full and open competition.
Focus on improving payment accuracy aligns with government efficiency goals.
Contract duration allows for thorough validation activities.

Sector Analysis

This contract falls within administrative management and general management consulting services, specifically focused on data validation for healthcare programs. Spending in this sector is significant as agencies increasingly rely on data analytics for program integrity and efficiency.

Small Business Impact

The data indicates this is a delivery order under a larger contract and does not specify small business participation. Further analysis would be needed to determine if small businesses were involved in subcontracting opportunities.

Oversight & Accountability

The contract is managed by the Centers for Medicare and Medicaid Services (CMS), a major agency within HHS. Oversight would involve monitoring Deloitte's performance, adherence to contract terms, and the accuracy of their validation work.

Related Government Programs

Administrative Management and General Management Consulting Services
Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Complexity of Medicare payment systems.
Potential for data integrity issues.
Ensuring consistent application of validation rules.
Managing contractor performance over the contract duration.
Interdependencies with other CMS payment accuracy initiatives.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $23.3 million to DELOITTE CONSULTING LLP. IGF::OT::IGF RADV AWARD THE CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) CURRENTLY UNDERTAKES MANY ACTIVITIES TO VALIDATE THE INPUTS AND OUTPUTS OF MEDICARE PARTS C AND D PAYMENTS TO ASSURE PAYMENT ACCURACY. FOR THE PURPOSES OF THIS CONTRACT, THE FOCUS WILL BE ON SERVING AS THE LEAD ANALYTICAL CONTRACTOR FOR RISK ADJUSTMENT DATA VALIDATION (RADV) ACTIVITIES. CMS CONDUCTS TWO TYPES OF RADV ACTIVITIES 1) A NATIONAL PAYMENT ERROR ESTIMATE TO COMPLY WITH THE IMPROPER PAYMENT&INFORMATION ACT (I

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

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 $23.3 million.

What is the period of performance?

Start: 2015-09-15. End: 2019-03-14.

What is the specific methodology used by Deloitte for RADV and how does it compare to industry best practices?

The contract description focuses on the purpose of RADV activities rather than the specific methodology. A detailed review of Deloitte's proposed approach, including data sampling techniques, statistical analysis, and reporting protocols, would be necessary to assess its alignment with industry best practices and ensure robust validation of Medicare payments.

What are the key performance indicators (KPIs) for this contract and how will they be measured to ensure effectiveness?

Key performance indicators are crucial for measuring the effectiveness of RADV activities. While not detailed here, typical KPIs might include the accuracy rate of payment error identification, the timeliness of validation reports, and the reduction in improper payments achieved. CMS would need to establish clear, measurable KPIs and a robust monitoring system.

What is the potential financial risk to CMS if the RADV validation is inaccurate or incomplete?

Inaccurate or incomplete RADV validation poses a significant financial risk to CMS. It could lead to continued overpayments to Medicare Advantage and Part D plans, resulting in substantial financial losses for the government and taxpayers. Conversely, overly aggressive validation could lead to disputes and appeals from contractors.

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) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HHSM5002015RFQ0041

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Touche Tohmatsu Limited

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

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

Financial Breakdown

Contract Ceiling: $23,336,393

Exercised Options: $23,336,393

Current Obligation: $23,336,393

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $1,018,609

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS00F0028Y

IDV Type: FSS

Timeline