HHS awarded CGI Federal $22.6M for website support, raising questions about competition and value

Contract Overview

Contract Amount: $22,583,793 ($22.6M)

Contractor: CGI Federal Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2009-06-16

End Date: 2010-05-31

Contract Duration: 349 days

Daily Burn Rate: $64.7K/day

Competition Type: NON-COMPETITIVE DELIVERY ORDER

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: WEBSITE SUPPORT SERVICES

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $22.6 million to CGI FEDERAL INC. for work described as: WEBSITE SUPPORT SERVICES Key points: 1. Contract awarded via non-competitive delivery order, limiting price discovery. 2. Cost-plus-fixed-fee structure may incentivize higher costs. 3. Short contract duration (349 days) suggests a tactical need rather than long-term strategy. 4. Contract value is significant for IT support services. 5. No indication of small business participation or set-aside. 6. Performance period ended over a decade ago, limiting current relevance.

Value Assessment

Rating: questionable

The contract value of $22.6 million for website support services over approximately one year appears high, especially given the non-competitive award. Without a competitive bidding process, it is difficult to benchmark the pricing against market rates or similar contracts. The cost-plus-fixed-fee (CPFF) pricing structure, while offering flexibility, can sometimes lead to higher overall costs for the government if not carefully managed and monitored. The absence of detailed performance metrics or outcomes makes a definitive value assessment challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

This contract was awarded as a non-competitive delivery order, meaning it was not subject to a broad solicitation and evaluation of multiple proposals. This approach is typically used when only one source is capable of meeting the requirement, or in urgent situations. The lack of competition means that the government did not benefit from the price reductions and service improvements that can arise from a competitive bidding process. The number of bidders was effectively one, limiting the government's leverage.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without competing offers, there is less assurance that the government secured the best possible price and value for these website support services.

Public Impact

Beneficiary: Department of Health and Human Services (HHS) and its Centers for Medicare and Medicaid Services (CMS). Services Delivered: Website support, likely encompassing maintenance, development, and operational assistance. Geographic Impact: Primarily impacts federal operations within the US, with potential for national reach depending on the website's function. Workforce Implications: Supported IT professionals within CGI Federal Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potentially increases costs.
Cost-plus-fixed-fee structure can lead to cost overruns if not managed.
Lack of transparency regarding the justification for non-competitive award.
Contract performance ended in 2010, making current relevance limited for assessing ongoing value.

Positive Signals

Contract provided essential website support services to a critical federal agency.
CGI Federal Inc. is a known entity in government contracting.
Fixed fee component provides some cost certainty compared to pure cost-reimbursement.

Sector Analysis

The IT services sector, particularly government contracting for website support and computer systems design, is a large and competitive market. Federal agencies frequently procure these services to maintain and enhance their digital presence and operational systems. Spending in this category can range from small, task-specific orders to large, multi-year contracts. Benchmarks for similar website support contracts would typically consider factors like the complexity of the website, the level of support required (e.g., maintenance, development, security), and the duration of the contract.

Small Business Impact

There is no indication from the provided data that this contract involved small business set-asides or subcontracting. The award was made to CGI Federal Inc., a large business. Without specific subcontracting plans or reporting, the impact on the small business ecosystem is likely minimal for this particular award, and there's no evidence of efforts to leverage small businesses for this requirement.

Oversight & Accountability

Oversight for this contract would have been managed by the Centers for Medicare and Medicaid Services (CMS) within HHS. As a non-competitive award, scrutiny might be higher regarding the justification and necessity. Transparency is limited by the available data, and it's unclear if an Inspector General review was conducted. Accountability would be tied to the contract's performance clauses and the fixed fee structure, but without detailed performance reports, assessing accountability is difficult.

Related Government Programs

IT Services
Website Development and Maintenance
Computer Systems Design Services
HHS IT Contracts
CMS IT Contracts

Risk Flags

Non-competitive award
Cost-plus-fixed-fee pricing
Lack of performance metrics in data

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $22.6 million to CGI FEDERAL INC.. WEBSITE SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is CGI FEDERAL 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 $22.6 million.

What is the period of performance?

Start: 2009-06-16. End: 2010-05-31.

What was the specific justification for awarding this contract on a non-competitive basis?

The provided data indicates the contract was a 'NON-COMPETITIVE DELIVERY ORDER'. Typically, such awards are justified under specific exceptions to full and open competition, such as the availability of only one responsible source, urgent and compelling needs, or specific statutory authorities. For this particular contract, the exact justification would be detailed in the contract file, likely citing a sole-source justification or a limited competition rationale. Without access to the contract file or agency documentation, the precise reason remains unconfirmed, but it implies that a competitive process was deemed either impractical or unnecessary by the procuring agency at the time of award.

How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for similar IT support services?

The Cost-Plus-Fixed-Fee (CPFF) structure is one of several contract types used in federal procurement. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This contrasts with fixed-price contracts, where the price is set regardless of actual costs, and cost-reimbursement contracts without a fixed fee. For IT support services, CPFF can be suitable when the scope of work is not precisely defined or is expected to evolve, allowing for flexibility. However, it carries a risk of cost overruns if costs escalate beyond initial estimates, as the government bears the cost risk. Competitive bidding often favors fixed-price or firm-fixed-price contracts when requirements are well-defined, as they offer better price certainty for the government. The choice of CPFF here suggests a degree of uncertainty in the scope or a need for flexibility in the website support services.

What were the key performance indicators (KPIs) or service level agreements (SLAs) for this contract?

The provided data does not include specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) associated with this contract. For IT support services, typical KPIs might include website uptime, response times for technical issues, resolution times for bugs, security patch deployment rates, and user satisfaction metrics. Service Level Agreements would define the expected standards for these metrics. Without this information, it is difficult to objectively assess the contractor's performance and the overall effectiveness of the services delivered under this $22.6 million award. Agencies usually document these in the contract's statement of work or performance work statement.

What is the historical spending trend for website support services at CMS or HHS?

Historical spending trends for website support services at CMS or HHS are not detailed in the provided data. However, federal agencies, particularly large ones like HHS and its sub-agencies such as CMS, consistently invest significant resources in maintaining and developing their extensive web presences. This includes support for public-facing websites, internal portals, and data dissemination platforms. Spending in this area can fluctuate based on modernization initiatives, new program launches, and evolving technology requirements. Analyzing historical spending would require accessing broader federal procurement databases (like FPDS or USASpending.gov) and filtering for relevant NAICS codes (like 541512 for Computer Systems Design Services) and contract types related to website support over multiple fiscal years.

What is the track record of CGI Federal Inc. in providing similar IT support services to the federal government?

CGI Federal Inc. has a substantial track record of providing a wide range of IT and professional services to the U.S. federal government across various agencies. They are a well-established contractor known for handling large and complex IT projects, including systems integration, software development, cybersecurity, and infrastructure support. Their past performance includes numerous contracts with agencies such as the Department of Homeland Security, Treasury, and Health and Human Services. While this specific contract ended in 2010, CGI Federal continues to be an active participant in federal IT procurements. A comprehensive assessment of their track record would involve reviewing their performance on other contracts, including any past performance evaluations or awards/debarments.

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: NON-COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: CGI Inc

Address: 12601 FAIR LAKES CIR, FAIRFAX, VA, 22033

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $35,777,365

Exercised Options: $22,583,793

Current Obligation: $22,583,793

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSM500200700015I

IDV Type: IDC

Timeline