HHS awards $29.4M for enterprise systems development to General Dynamics IT

Contract Overview

Contract Amount: $29,396,399 ($29.4M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2009-04-01

End Date: 2014-03-31

Contract Duration: 1,825 days

Daily Burn Rate: $16.1K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 5

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: ENTERPRISE SYSTEMS DEVELOPMENT

Place of Performance

Location: WINDSOR MILL, BALTIMORE County, MARYLAND, 21244

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $29.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: ENTERPRISE SYSTEMS DEVELOPMENT Key points: 1. Value for money assessed through cost-plus-award-fee structure, allowing for performance-based incentives. 2. Competition dynamics indicate a competitive delivery order, suggesting potential for price discovery. 3. Risk indicators include the use of a cost-plus award fee contract type, which can incentivize cost overruns if not managed carefully. 4. Performance context is tied to enterprise systems development, a critical but complex area for government operations. 5. Sector positioning within IT services, specifically computer systems design, highlights the contract's focus on technical solutions.

Value Assessment

Rating: fair

The contract's cost-plus-award-fee structure allows for flexibility but requires diligent oversight to ensure value. Benchmarking against similar enterprise systems development contracts is challenging without more granular data on specific deliverables and performance metrics. The total award value of $29.4 million over five years suggests a significant investment, and the value proposition hinges on the successful development and implementation of critical systems for CMS.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors likely had the opportunity to bid. The presence of competition is generally positive for price discovery and can lead to more favorable terms for the government. The specific number of bidders is not provided, but the competitive nature suggests that the government sought to leverage market capabilities.

Taxpayer Impact: A competitive award process helps ensure that taxpayer funds are used efficiently by fostering a marketplace where contractors vie for the best price and performance.

Public Impact

Beneficiaries include the Centers for Medicare and Medicaid Services (CMS) and potentially millions of healthcare beneficiaries who rely on the systems developed. Services delivered encompass computer systems design and development, crucial for the operational efficiency of CMS. Geographic impact is primarily within Maryland, where the contractor is located, but the systems developed will have a national reach. Workforce implications may include employment opportunities for IT professionals within General Dynamics Information Technology and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-award-fee contracts can incentivize contractors to increase costs to achieve higher award fees if not properly managed.
The duration of the contract (5 years) necessitates ongoing monitoring to ensure continued alignment with evolving technological needs and agency priorities.

Positive Signals

Awarded through a competitive process, suggesting potential for good value and performance.
Focus on enterprise systems development addresses critical IT infrastructure needs for a major federal agency.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically in computer systems design services. The federal IT market is vast, with significant spending on systems development and maintenance. Comparable spending benchmarks would typically involve analyzing other large-scale enterprise IT development contracts awarded by agencies like HHS, DOD, or DHS, considering factors like contract type, scope, and duration.

Small Business Impact

Information regarding small business set-asides or subcontracting plans for this specific delivery order was not provided. However, for large IT contracts, there is often an expectation or requirement for prime contractors to engage small businesses in their subcontracting efforts to foster broader participation in federal contracting.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program officials within CMS. The cost-plus-award-fee structure implies performance metrics and evaluation criteria that are subject to review. Transparency is generally facilitated through contract databases, but detailed performance reports are often internal to the agency.

Related Government Programs

Healthcare IT Modernization
Federal Enterprise Architecture
Health Information Exchange
CMS IT Modernization Initiatives

Risk Flags

Cost-plus-award-fee contract type requires careful monitoring to prevent cost overruns.
Complexity of enterprise systems development carries inherent risks of schedule delays and technical challenges.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $29.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. ENTERPRISE SYSTEMS DEVELOPMENT

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

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 $29.4 million.

What is the period of performance?

Start: 2009-04-01. End: 2014-03-31.

What was the specific performance history of General Dynamics Information Technology on similar enterprise systems development contracts prior to this award?

Assessing the contractor's track record on similar projects is crucial for understanding their capability and reliability. While specific performance data for this contract is not detailed here, a review of past performance evaluations, past performance information (PPI) databases, and any publicly available contract award histories for General Dynamics Information Technology (GDIT) on large-scale enterprise systems development would be necessary. This would include examining metrics related to on-time delivery, budget adherence, technical solution quality, and customer satisfaction on comparable government contracts. A history of successful project completion and positive performance reviews would increase confidence in GDIT's ability to deliver on this $29.4 million contract.

How does the awarded price compare to independent government cost estimates or market research for similar enterprise systems development services?

The value for money of this $29.4 million contract is best assessed by comparing its pricing to independent government cost estimates (IGCEs) or thorough market research conducted prior to award. The contract type, Cost Plus Award Fee (CPAF), means the final cost can vary based on performance. Therefore, a comparison would ideally look at the base cost plus the potential award fee. Benchmarking against industry standards for similar IT development projects, considering factors like labor rates, complexity, and project duration, is also essential. Without access to the IGCE or detailed market research, it's difficult to definitively state if the awarded price represents excellent value, but the competitive nature of the award suggests an effort was made to secure a fair market price.

What are the key performance indicators (KPIs) and award fee criteria used to evaluate General Dynamics Information Technology's performance on this contract?

The effectiveness and value of this Cost Plus Award Fee (CPAF) contract are directly tied to the clarity and rigor of its Key Performance Indicators (KPIs) and award fee criteria. These metrics, established in the contract's Performance Work Statement (PWS), should objectively measure GDIT's success in developing enterprise systems. Examples of relevant KPIs could include system uptime, data accuracy rates, successful integration with existing infrastructure, user adoption rates, and adherence to security protocols. The award fee structure incentivizes GDIT to exceed minimum performance requirements. A thorough review of these KPIs and criteria would reveal the specific objectives the agency prioritized and how contractor performance is quantitatively and qualitatively assessed.

What is the historical spending trend for enterprise systems development at CMS, and how does this contract fit into that pattern?

Understanding the historical spending on enterprise systems development at the Centers for Medicare and Medicaid Services (CMS) provides context for this $29.4 million contract. CMS, responsible for critical healthcare programs, relies heavily on robust IT systems. Analyzing past budgets and contract awards for similar development projects would reveal whether this contract represents a typical investment, an increase, or a decrease in spending for this category. Trends might indicate a strategic shift towards modernization, consolidation of systems, or expansion of capabilities. This contract's duration (5 years) and value suggest a significant, long-term commitment to enhancing CMS's enterprise systems, aligning with the agency's ongoing need to adapt its technological infrastructure to evolving healthcare demands and policy changes.

Are there any identified risks associated with the specific technologies or methodologies employed by General Dynamics Information Technology for this enterprise systems development project?

Assessing risks related to the technologies and methodologies chosen for this $29.4 million enterprise systems development contract is vital. This involves evaluating whether GDIT is employing proven, secure, and scalable solutions or cutting-edge, potentially less stable, technologies. Risks could include integration challenges with legacy systems, cybersecurity vulnerabilities inherent in new platforms, vendor lock-in, or the need for specialized skill sets that may be difficult to retain. The CPAF contract type might mitigate some risk by allowing flexibility, but it also requires careful management to ensure that the chosen path leads to a successful, sustainable outcome. A review of GDIT's proposed technical approach and any independent technical assessments would be necessary to fully evaluate these risks.

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: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 5

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3150 FAIRVIEW PARK DR STE 100, FALLS CHURCH, VA, 22042

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

Financial Breakdown

Contract Ceiling: $29,396,399

Exercised Options: $29,396,399

Current Obligation: $29,396,399

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSM500200700022I

IDV Type: IDC

Timeline