HHS awards $55.6M for CWF system support to DV United LLC, including maintenance and enhancements

Contract Overview

Contract Amount: $55,587,240 ($55.6M)

Contractor: DV United LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2017-06-01

End Date: 2022-03-31

Contract Duration: 1,764 days

Daily Burn Rate: $31.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF COMPUTER SOFTWARE SERVICES TO SUPPORT THE COMMON WORKING FILE (CWF) SYSTEM, INCLUDING MAINTENANCE, DEVELOPMENTAL ENHANCEMENTS, AND SPECIAL PROJECTS AS REQUIRE

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $55.6 million to DV UNITED LLC for work described as: IGF::OT::IGF COMPUTER SOFTWARE SERVICES TO SUPPORT THE COMMON WORKING FILE (CWF) SYSTEM, INCLUDING MAINTENANCE, DEVELOPMENTAL ENHANCEMENTS, AND SPECIAL PROJECTS AS REQUIRE Key points: 1. Contract focuses on critical Common Working File (CWF) system support for CMS. 2. DV United LLC, a small business, is the awardee. 3. The contract type is Cost Plus Fixed Fee, indicating potential for cost overruns. 4. The sector is IT services, specifically Computer Systems Design.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee structure allows for costs to exceed initial estimates, making direct pricing comparison difficult without detailed cost breakdowns. The total award value of $55.6M over nearly 5 years suggests a significant investment in IT services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a limited competition. This method may not have yielded the most competitive pricing possible, as not all potential sources were considered.

Taxpayer Impact: The use of a limited competition and a cost-reimbursement contract type raises concerns about maximizing taxpayer value and ensuring the lowest possible price for essential IT services.

Public Impact

Ensures continued operation and enhancement of the Common Working File (CWF) system, vital for Medicare and Medicaid operations. Supports IT infrastructure and services for the Centers for Medicare and Medicaid Services (CMS). Potential impact on beneficiaries if CWF system performance is degraded due to inadequate support or cost inefficiencies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may lead to higher costs.
Cost Plus Fixed Fee contract type can incentivize higher spending.
Lack of detailed cost data makes value assessment challenging.

Positive Signals

Supports a critical government IT system.
Awarded to a small business.
Includes provisions for developmental enhancements, suggesting modernization efforts.

Sector Analysis

This contract falls within the IT services sector, specifically Computer Systems Design Services. Spending in this area is substantial across government, with benchmarks varying widely based on complexity and scope. The $55.6M award is significant for a single contract of this nature.

Small Business Impact

The awardee, DV United LLC, is identified as a small business. This aligns with government goals to support small businesses, but the contract's limited competition aspect warrants scrutiny to ensure fair opportunity was considered.

Oversight & Accountability

The contract's oversight would typically fall under CMS's program management and contracting officers. The Cost Plus Fixed Fee structure necessitates robust oversight to monitor costs and ensure performance aligns with contract requirements and taxpayer interests.

Related Government Programs

Computer Systems Design Services
Department of Health and Human Services Contracting
Centers for Medicare and Medicaid Services Programs

Risk Flags

Potential for cost overruns due to CPFF structure.
Limited competition may have restricted price discovery.
Lack of transparency in cost reporting.
Dependency on a single contractor for critical system support.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $55.6 million to DV UNITED LLC. IGF::OT::IGF COMPUTER SOFTWARE SERVICES TO SUPPORT THE COMMON WORKING FILE (CWF) SYSTEM, INCLUDING MAINTENANCE, DEVELOPMENTAL ENHANCEMENTS, AND SPECIAL PROJECTS AS REQUIRE

Who is the contractor on this award?

The obligated recipient is DV UNITED 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 $55.6 million.

What is the period of performance?

Start: 2017-06-01. End: 2022-03-31.

What was the rationale for excluding other sources in the 'full and open competition after exclusion of sources' award?

The rationale for excluding other sources needs further investigation. While the data indicates 'full and open competition after exclusion of sources,' the specific reasons for this exclusion are not provided. Understanding this is crucial to assess if the government truly received the best value and if competitive pressures were fully leveraged.

How does the actual cost performance compare to the fixed fee and projected costs under this CPFF contract?

Assessing the actual cost performance against the fixed fee and projected costs is essential for evaluating value. Without access to detailed financial reports and cost breakdowns, it's difficult to determine if DV United LLC managed costs effectively or if the government paid a premium due to the CPFF structure.

What specific developmental enhancements were prioritized and delivered under this contract, and what was their impact on CWF system effectiveness?

The impact of developmental enhancements on the CWF system's effectiveness is a key measure of success. Understanding which enhancements were prioritized, their technical implementation, and their measurable benefits (e.g., improved processing times, reduced errors, enhanced user experience) is critical to gauge the contract's overall value and return on investment.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: NIHJT2010002

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 7343 WAVERLY DR, WARRENTON, VA, 20186

Business Categories: Category Business, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $55,724,874

Exercised Options: $55,587,240

Current Obligation: $55,587,240

Actual Outlays: $8,205,564

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200193W

IDV Type: GWAC

Timeline