HHS awarded $17.5M for advertising services, with a 3-year duration and full and open competition

Contract Overview

Contract Amount: $17,488,559 ($17.5M)

Contractor: Porter Novelli Public Services Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2010-07-30

End Date: 2012-08-01

Contract Duration: 733 days

Daily Burn Rate: $23.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: TAS::75 0511::TAS GENERAL MARKET OPEN ENROLLMENT/LOW INCOME SUBSIDY

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $17.5 million to PORTER NOVELLI PUBLIC SERVICES INC. for work described as: TAS::75 0511::TAS GENERAL MARKET OPEN ENROLLMENT/LOW INCOME SUBSIDY Key points: 1. The contract value of $17.5M over 733 days suggests a moderate annual spend for advertising services. 2. Full and open competition indicates a potentially competitive bidding process, which can lead to better pricing. 3. The contract type is Cost Plus Fixed Fee, which can sometimes lead to cost overruns if not managed carefully. 4. The award was made to PORTER NOVELLI PUBLIC SERVICES INC., a single contractor, suggesting a focus on specialized services. 5. The contract duration of 733 days (approximately 2 years) is typical for service contracts of this nature. 6. The primary service area is advertising, a common need for government agencies to communicate programs and initiatives.

Value Assessment

Rating: fair

The contract value of $17.5 million over approximately two years for advertising services appears within a reasonable range for large-scale public awareness campaigns. However, without specific benchmarks for similar government advertising contracts or detailed service breakdowns, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee structure necessitates careful oversight to ensure costs remain controlled and the fixed fee is justified by the scope of work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple bidders were likely invited to submit proposals. The presence of 3 bids indicates a degree of competition, which is generally positive for price discovery and ensuring the government receives competitive offers. This approach allows for a wider pool of potential contractors to be considered, potentially leading to innovation and better service alignment.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a marketplace where contractors vie for the best price and quality, potentially driving down costs and improving service delivery.

Public Impact

The primary beneficiaries are the public, who will receive information about government programs and initiatives through advertising campaigns. Services delivered include advertising and public relations, aimed at informing and engaging target audiences. The geographic impact is likely national, given the scope of federal programs, though specific campaign targeting may vary. Workforce implications could include support for the contractor's employees and potentially indirect benefits to media outlets and advertising industry professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can incentivize contractors to incur higher costs if the fixed fee is substantial relative to the effort.
Limited competition (3 bidders) might not represent the full spectrum of available expertise or the most competitive pricing.
The specific nature of the advertising campaign and its effectiveness are not detailed, making it hard to gauge performance impact.
The contract duration of over two years requires ongoing monitoring to ensure continued relevance and value.

Positive Signals

Awarded under full and open competition, which typically promotes a fair and transparent process.
The contractor, PORTER NOVELLI PUBLIC SERVICES INC., is a known entity in the public relations and advertising space.
The contract has a defined end date, providing a clear timeframe for service delivery and evaluation.
The contract value is publicly disclosed, allowing for transparency in government spending.

Sector Analysis

The advertising and public relations sector is a significant market for government agencies seeking to communicate with the public. Federal spending in this area supports a wide range of activities, from health awareness campaigns to promoting government services. This contract fits within the broader category of professional services, where agencies often rely on specialized firms to reach diverse audiences effectively. Benchmarks for similar contracts would typically consider the scope of the campaign, target audience size, and media channels utilized.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit mention of subcontracting goals for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for specific services.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services (HHS) and its Centers for Medicare and Medicaid Services (CMS). As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure the fixed fee remains appropriate for the work performed. Transparency is facilitated by public contract databases, but detailed performance metrics and specific oversight reports would require further investigation.

Related Government Programs

HHS Public Awareness Campaigns
CMS Outreach Programs
Federal Advertising and Public Relations Contracts
Government Communication Services

Risk Flags

Cost Plus Fixed Fee contract type requires careful monitoring to prevent cost overruns.
Limited number of bidders (3) may indicate potential for less competitive pricing than a broader competition.
Lack of specific performance metrics in the provided data makes it difficult to assess contract effectiveness.
The contract is for advertising services, where measuring direct ROI can sometimes be challenging.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $17.5 million to PORTER NOVELLI PUBLIC SERVICES INC.. TAS::75 0511::TAS GENERAL MARKET OPEN ENROLLMENT/LOW INCOME SUBSIDY

Who is the contractor on this award?

The obligated recipient is PORTER NOVELLI PUBLIC SERVICES 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 $17.5 million.

What is the period of performance?

Start: 2010-07-30. End: 2012-08-01.

What specific advertising campaigns or public awareness initiatives were undertaken under this contract?

The provided data does not specify the exact advertising campaigns or public awareness initiatives conducted under this contract. However, given the awarding agency is the Centers for Medicare and Medicaid Services (CMS) within HHS, it is highly probable that the services were related to promoting healthcare programs such as Medicare, Medicaid, or the Affordable Care Act (ACA) marketplaces. These campaigns often aim to inform the public about enrollment periods, benefits, and eligibility requirements. Further details would typically be found in contract performance reports or agency public affairs documentation.

How does the $17.5 million contract value compare to other federal advertising contracts of similar scope?

Comparing the $17.5 million contract value requires context on the scope, duration, and specific services rendered. For large-scale, multi-year national campaigns by agencies like HHS, this figure is within a plausible range. For instance, major public health initiatives or enrollment drives can incur significant media buys and creative development costs. However, without detailed breakdowns of media spending, creative production, and target audience reach, a direct comparison to other federal advertising contracts is difficult. Smaller, regional, or more narrowly focused campaigns would naturally have lower values.

What are the key performance indicators (KPIs) used to evaluate the success of this contract?

The provided data does not include specific Key Performance Indicators (KPIs) for this contract. Typically, for advertising and public relations contracts, KPIs might include metrics such as reach, frequency, impressions, website traffic, call center volume, enrollment numbers, public awareness survey results, media mentions, and sentiment analysis. The effectiveness of the contract would be assessed based on how well these metrics align with the stated objectives of the advertising campaigns managed by CMS.

What is the track record of PORTER NOVELLI PUBLIC SERVICES INC. with federal government contracts, particularly with HHS?

PORTER NOVELLI PUBLIC SERVICES INC. has a history of securing federal contracts, including work with the Department of Health and Human Services (HHS). Their experience often involves public relations, strategic communications, and advertising services. While this specific contract was for $17.5 million over two years, their broader federal portfolio may include contracts of varying sizes and scopes across different agencies. A detailed review of their past performance, including any past performance evaluations or awards, would provide a more comprehensive understanding of their track record.

What is the risk associated with the Cost Plus Fixed Fee (CPFF) contract type for this service?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract type is the potential for cost overruns. While the contractor is reimbursed for allowable costs, the fixed fee is predetermined. If costs escalate significantly beyond initial projections, the contractor may be incentivized to manage expenses carefully to protect their fee. However, the government bears the risk of higher overall costs if the contractor's efficiency is low or unforeseen circumstances drive up expenses. Robust oversight and clear definition of 'allowable costs' are critical to mitigate this risk.

How has federal spending on advertising and public relations services evolved over the years?

Federal spending on advertising and public relations services has generally fluctuated based on agency needs, legislative priorities, and budget allocations. Major public health initiatives, national security awareness campaigns, and efforts to promote government programs often drive significant spending in this sector. Over the years, there has been a trend towards more data-driven campaigns, digital advertising, and sophisticated audience targeting. While specific historical spending data for this exact category requires detailed analysis of federal procurement databases, it's understood that agencies consistently utilize these services to fulfill their communication mandates.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Advertising, Public Relations, and Related Services › Advertising Agencies

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: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Omnicom Group Inc.

Address: 1909 K ST NW STE 400, WASHINGTON, DC, 20006

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $17,488,559

Exercised Options: $17,488,559

Current Obligation: $17,488,559

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSM500200600017I

IDV Type: IDC

Timeline