HHS Spends $35.9M on Computing Infrastructure for CWF, Awarded to Peraton
Contract Overview
Contract Amount: $35,911,095 ($35.9M)
Contractor: Peraton Enterprise Solutions LLC
Awarding Agency: Department of Health and Human Services
Start Date: 2014-11-21
End Date: 2020-01-12
Contract Duration: 1,878 days
Daily Burn Rate: $19.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CWF HOSTS FY15 TO 19 IGF::OT::IGF
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $35.9 million to PERATON ENTERPRISE SOLUTIONS LLC for work described as: CWF HOSTS FY15 TO 19 IGF::OT::IGF Key points: 1. Significant spending on computing infrastructure highlights reliance on external providers. 2. Peraton Enterprise Solutions LLC secured the contract, indicating a competitive landscape for these services. 3. The contract duration of 1878 days suggests a long-term need for these IT services. 4. The award falls under the Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services NAICS code.
Value Assessment
Rating: fair
The total award of $35.9M over nearly 5 years for computing infrastructure services appears reasonable given the duration and scope. Benchmarking against similar large-scale hosting contracts would provide a more precise assessment of value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust process for price discovery and selection of the most advantageous offer. This method generally leads to better pricing outcomes for the government.
Taxpayer Impact: The competitive award process aims to ensure taxpayer funds are used efficiently for essential IT services.
Public Impact
Ensures continuity of critical Centers for Medicare and Medicaid Services (CMS) operations. Supports the processing and hosting of vital health data. Provides the backbone for various digital health initiatives and services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in with long-term contracts.
- Reliance on a single vendor for critical infrastructure.
- Cybersecurity risks associated with hosting sensitive data.
Positive Signals
- Awarded through full and open competition.
- Firm Fixed Price contract type helps control costs.
- Long contract duration indicates stable service provision.
Sector Analysis
This spending falls within the IT sector, specifically on computing infrastructure and hosting services. Benchmarks for similar contracts vary widely based on scale, security requirements, and service level agreements, but $35.9M over five years for a government agency is substantial.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The primary awardee, Peraton Enterprise Solutions LLC, is a large business, suggesting limited direct participation for small businesses in this specific contract.
Oversight & Accountability
The contract was awarded by the Centers for Medicare and Medicaid Services (CMS), a major agency within HHS. Oversight would typically involve contract management offices ensuring performance and adherence to terms.
Related Government Programs
- Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services
- Department of Health and Human Services Contracting
- Centers for Medicare and Medicaid Services Programs
Risk Flags
- Significant contract value.
- Long contract duration.
- Award to a large business.
- Potential for vendor lock-in.
- Reliance on external IT providers.
Tags
computing-infrastructure-providers-data-, department-of-health-and-human-services, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $35.9 million to PERATON ENTERPRISE SOLUTIONS LLC. CWF HOSTS FY15 TO 19 IGF::OT::IGF
Who is the contractor on this award?
The obligated recipient is PERATON ENTERPRISE SOLUTIONS 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 $35.9 million.
What is the period of performance?
Start: 2014-11-21. End: 2020-01-12.
What specific services are included under 'Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services' for CMS?
This category encompasses a broad range of IT services essential for government operations. It typically includes the provision of server infrastructure, data storage, network connectivity, data processing, cloud hosting, and related managed services. For CMS, these services are critical for maintaining patient data, processing claims, and supporting public-facing health information portals.
What are the primary risks associated with a long-term (1878 days) contract for critical IT infrastructure?
Key risks include technological obsolescence, where the contracted services may become outdated before the contract ends. There's also the risk of vendor lock-in, making it difficult and costly to switch providers if performance issues arise or better options emerge. Furthermore, a prolonged reliance on a single vendor for critical infrastructure can increase vulnerability to security breaches or service disruptions if the vendor experiences issues.
How does the firm fixed price contract type impact the effectiveness of this $35.9M award?
A Firm Fixed Price (FFP) contract type is generally effective in controlling costs for the government, as the price is set regardless of the contractor's actual costs. This shifts the risk of cost overruns to the contractor. For IT infrastructure, FFP can be effective if the scope of work is well-defined and unlikely to change significantly, ensuring budget predictability and accountability for the awarded amount.
Industry Classification
NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: RFPCMS20120007
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Veritas Capital Fund Management, L.L.C.
Address: 15050 CONFERENCE CENTER DR, CHANTILLY, VA, 20151
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $35,911,095
Exercised Options: $35,911,095
Current Obligation: $35,911,095
Subaward Activity
Number of Subawards: 8
Total Subaward Amount: $5,082,597
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HHSM500201300014I
IDV Type: IDC
Timeline
Start Date: 2014-11-21
Current End Date: 2020-01-12
Potential End Date: 2020-01-12 00:00:00
Last Modified: 2022-11-03
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