HHS awards $21.9M contract for audit, oversight, and tech support to Conrad LLP

Contract Overview

Contract Amount: $21,921,974 ($21.9M)

Contractor: Conrad LLP

Awarding Agency: Department of Health and Human Services

Start Date: 2016-01-01

End Date: 2018-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $20.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: IGF::OT::IGF AUDIT, OVERSIGHT AND TECH/OP SUPPORT OF MA, PDP, PACE

Place of Performance

Location: LAKE FOREST, ORANGE County, CALIFORNIA, 92630

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $21.9 million to CONRAD LLP for work described as: IGF::OT::IGF AUDIT, OVERSIGHT AND TECH/OP SUPPORT OF MA, PDP, PACE Key points: 1. Contract awarded to Conrad LLP for audit, oversight, and technology support services. 2. The contract duration spans 1095 days, indicating a medium-term engagement. 3. Services cover multiple programs including MA, PDP, and PACE, suggesting broad operational impact. 4. The contract was awarded under full and open competition, implying a robust bidding process. 5. The use of Time and Materials pricing may present cost control challenges if not closely managed. 6. The contract value is significant, requiring diligent oversight to ensure value for money.

Value Assessment

Rating: fair

The contract value of $21.9 million over three years for audit, oversight, and tech support appears within a reasonable range for the scope of services. However, without specific benchmarks for similar comprehensive support contracts within CMS or HHS, a precise value-for-money assessment is challenging. The Time and Materials (T&M) pricing structure, while flexible, can lead to cost overruns if not meticulously monitored and controlled. Comparing this to other contracts for similar services would require detailed analysis of the specific deliverables and labor categories.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 3 bidders suggests a moderate level of competition for this requirement. While full and open competition is generally preferred for ensuring fair pricing and access to a wide range of capabilities, the specific number of bidders can influence the intensity of price negotiation and the ultimate value achieved.

Taxpayer Impact: A competitive bidding process generally benefits taxpayers by driving down prices and encouraging innovation. With three bidders, there was a reasonable incentive for each to offer competitive terms, potentially leading to cost savings compared to a sole-source award.

Public Impact

Beneficiaries of Medicare Advantage (MA), Prescription Drug Plans (PDP), and PACE programs will indirectly benefit from improved audit, oversight, and technology support, leading to more efficient program administration. The Centers for Medicare and Medicaid Services (CMS) will receive essential support for its critical operations, enhancing its ability to manage and regulate healthcare programs. The contract supports federal IT infrastructure and administrative functions, contributing to the overall stability and effectiveness of healthcare services delivery. The workforce implications are primarily within the contractor's organization, Conrad LLP, which will utilize its accounting and IT professionals to fulfill the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing structure can lead to cost escalation if not managed effectively.
The broad scope of services (audit, oversight, tech support) may present challenges in ensuring consistent quality across all areas.
Reliance on a single contractor for critical support functions could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The contract duration of three years provides stability for program support.
The contractor, Conrad LLP, is likely experienced in accounting and IT support, given the NAICS code.

Sector Analysis

The North American Industry Classification System (NAICS) code 541211, Offices of Certified Public Accountants, places this contract within the professional services sector, specifically accounting and auditing. This sector is crucial for government operations, ensuring financial integrity and compliance. The market for government contracting in this area is substantial, with agencies like CMS frequently seeking external expertise for complex financial and operational oversight. Comparable spending benchmarks would typically involve analyzing other large contracts for audit, financial management, and IT support services awarded by federal agencies.

Small Business Impact

This contract was not set aside for small businesses, as indicated by `sb: false`. The prime contractor, Conrad LLP, is likely a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific prime contract is likely minimal, unless Conrad LLP voluntarily engages small businesses for specialized support.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Centers for Medicare and Medicaid Services (CMS) contracting officers and program managers. The Inspector General's office within HHS may also conduct audits or investigations related to the services provided to ensure compliance and prevent fraud, waste, and abuse. Transparency is generally maintained through contract award databases and public reporting, though specific performance metrics and detailed oversight activities are often internal.

Related Government Programs

Medicare Audit and Oversight
Medicaid Program Integrity
Healthcare IT Support Services
Federal Financial Management
Contractor Performance Management

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Need for robust oversight to manage scope and ensure quality across diverse service areas.
Limited insight into contractor's specific past performance on similar federal contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $21.9 million to CONRAD LLP. IGF::OT::IGF AUDIT, OVERSIGHT AND TECH/OP SUPPORT OF MA, PDP, PACE

Who is the contractor on this award?

The obligated recipient is CONRAD 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 $21.9 million.

What is the period of performance?

Start: 2016-01-01. End: 2018-12-31.

What is the track record of Conrad LLP in performing similar federal contracts?

Information regarding Conrad LLP's specific track record on federal contracts is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes on similar engagements with government agencies. Federal procurement databases and contract award histories can provide insights into their experience, the types of services they have delivered, and their performance ratings. Without this specific data, it's difficult to definitively assess their capability and reliability for this particular $21.9 million contract.

How does the $21.9 million contract value compare to similar audit and IT support contracts within HHS or CMS?

The $21.9 million contract value over three years for comprehensive audit, oversight, and IT support is a significant award. To benchmark this value, one would need to compare it against similar contracts awarded by CMS or other large federal health agencies for comparable services. Factors such as the scope of work, duration, labor mix, and specific deliverables are crucial for a meaningful comparison. If similar contracts for similar scope and duration are consistently awarded in the $5-10 million range, this contract might be considered higher, warranting closer scrutiny of the pricing and justification. Conversely, if the scope is exceptionally broad or complex, the value might be justified.

What are the primary risks associated with the Time and Materials (T&M) pricing structure used in this contract?

The primary risk associated with a Time and Materials (T&M) pricing structure is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual labor hours and materials used, plus a fee. If the contractor's efficiency is low, or if the scope of work expands without adequate controls, the total cost can escalate significantly beyond initial estimates. For taxpayers, this means less predictability in spending and a higher risk of paying more than anticipated. Effective risk mitigation requires robust oversight, detailed tracking of hours and expenses, and clear definition of work requirements to prevent scope creep.

How effective is the 'full and open competition' approach likely to be in ensuring value for money given the number of bidders?

The 'full and open competition' approach is generally the most effective method for ensuring value for money, as it allows the widest possible pool of potential contractors to bid. However, the effectiveness is also influenced by the number of actual bidders. With three bidders, there was a moderate level of competition. While this is better than a sole-source award, a larger number of bidders (e.g., five or more) often leads to more aggressive pricing and a stronger incentive for contractors to offer their best value proposition. The specific evaluation criteria and the agency's negotiation strategy also play a critical role in translating competition into tangible value for taxpayers.

What are the potential implications of this contract on the efficiency and effectiveness of Medicare and Medicaid programs?

This contract directly supports the operational efficiency and effectiveness of Medicare Advantage (MA), Prescription Drug Plans (PDP), and PACE programs by providing essential audit, oversight, and technology support. Improved audit and oversight functions can lead to better compliance, reduced fraud, waste, and abuse, and more accurate financial reporting. Enhanced technology support can streamline administrative processes, improve data management, and facilitate better decision-making. Ultimately, these improvements should contribute to the overall integrity and performance of these critical healthcare programs, ensuring that taxpayer funds are used appropriately and beneficiaries receive quality services.

Are there any historical spending patterns with Conrad LLP or for similar services at CMS that warrant attention?

The provided data does not include historical spending patterns for Conrad LLP or for similar services at CMS. To assess this, one would need to analyze past contract awards to Conrad LLP, their value, duration, and performance history, as well as aggregate spending by CMS on audit, oversight, and IT support functions over several fiscal years. Significant year-over-year increases in spending for these services, or a pattern of sole-source awards to specific contractors, could indicate areas needing further investigation regarding cost-effectiveness and competition.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Offices of Certified Public Accountants

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

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 23161 LAKE CENTER DR STE 200, LAKE FOREST, CA, 92630

Business Categories: Category Business, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,921,974

Exercised Options: $21,921,974

Current Obligation: $21,921,974

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS23F056AA

IDV Type: FSS

Timeline