Leidos awarded $185M for CHCS/AHLTA IT services, a significant investment in defense health IT infrastructure
Contract Overview
Contract Amount: $185,212,519 ($185.2M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2011-09-29
End Date: 2014-05-31
Contract Duration: 975 days
Daily Burn Rate: $190.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: BASE PERIOD CHCS/AHLTA
Place of Performance
Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22041
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $185.2 million to LEIDOS, INC. for work described as: BASE PERIOD CHCS/AHLTA Key points: 1. The contract value represents a substantial commitment to maintaining and enhancing critical defense health systems. 2. Competition dynamics for this contract are crucial for ensuring cost-effectiveness in a specialized IT sector. 3. Performance risk is moderate, given the complexity of managing large-scale health IT systems. 4. This contract is positioned within the broader Defense Health Agency's IT modernization efforts. 5. The sector for computer systems design services is highly competitive, but specialized health IT requires specific expertise.
Value Assessment
Rating: good
The contract value of $185.2 million for CHCS/AHLTA IT services appears reasonable given the scope and duration. Benchmarking against similar large-scale health IT system support contracts within the federal government would provide a more precise value-for-money assessment. The pricing structure (Cost Plus Fixed Fee) suggests a need for careful oversight to manage costs effectively, but it allows for flexibility in adapting to evolving system requirements. The awarded amount is within the expected range for such critical infrastructure support.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of three bidders suggests a healthy level of competition for this significant defense health IT contract. This competitive environment is generally favorable for price discovery and encourages contractors to offer competitive pricing and innovative solutions to win the award.
Taxpayer Impact: Full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple companies vied for the contract, driving down costs and improving service quality.
Public Impact
Military personnel and their families benefit from the reliable operation of the Composite Health Care System (CHCS) and Ambulatory Care Health Record System (AHLTA). Essential healthcare services are supported through the continuous availability and functionality of these critical IT systems. The geographic impact is nationwide, supporting military treatment facilities across various bases and locations. Workforce implications include the need for skilled IT professionals to maintain and upgrade these complex systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns with Cost Plus Fixed Fee contracts if not managed diligently.
- Ensuring system interoperability and data security across integrated health platforms is a constant challenge.
- Reliance on a single contractor for critical health IT infrastructure could pose a risk if performance falters.
Positive Signals
- Award to a large, established contractor like Leidos suggests a high likelihood of technical capability and experience.
- Full and open competition indicates a robust bidding process, likely resulting in a well-vetted solution.
- The contract duration and value suggest a long-term commitment to supporting vital defense health IT systems.
Sector Analysis
The federal IT services market, particularly within the defense sector, is substantial. This contract falls under computer systems design services, a segment focused on developing and implementing IT solutions. The Defense Health Agency (DHA) is a major player in this space, investing heavily in maintaining and modernizing its health information technology infrastructure to support military readiness and healthcare delivery. Comparable spending benchmarks would involve analyzing other large IT support contracts for critical systems within DoD and other federal agencies.
Small Business Impact
This contract was awarded under full and open competition and does not indicate a specific small business set-aside. While Leidos, Inc. is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors, particularly for specialized IT support services. The extent of small business subcontracting would depend on Leidos's subcontracting plan and the specific technical requirements of the contract.
Oversight & Accountability
Oversight for this contract would primarily fall under the Defense Health Agency's program management and contracting offices. Accountability measures are typically embedded within the contract's performance work statement (PWS), including defined deliverables, service level agreements, and reporting requirements. Transparency is facilitated through contract award announcements and public contract databases. The Inspector General for the Department of Defense may also conduct audits or investigations related to contract performance and financial management.
Related Government Programs
- Defense Health Information Management System (DHIMS)
- Electronic Health Record (EHR) Modernization Programs
- Military Health System (MHS) IT Infrastructure Support
- CHCS/AHLTA System Maintenance and Upgrades
Risk Flags
- Cost Management Risk (CPFF)
- System Interoperability Challenges
- Cybersecurity Vulnerabilities
- Performance Degradation Risk
Tags
it-services, computer-systems-design, defense-health-agency, department-of-defense, delivery-order, full-and-open-competition, cost-plus-fixed-fee, health-it, chcs, ahlta, leidos-inc, virginia
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $185.2 million to LEIDOS, INC.. BASE PERIOD CHCS/AHLTA
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $185.2 million.
What is the period of performance?
Start: 2011-09-29. End: 2014-05-31.
What is the historical spending trend for CHCS/AHLTA IT services under this contract and similar contracts?
The provided data indicates a base period award of $185,212,518.76 for CHCS/AHLTA IT services from September 29, 2011, to May 31, 2014. This represents a significant investment over approximately 32 months. To assess historical trends, one would need to examine prior contracts for these systems and any subsequent contract actions or modifications that extended beyond the stated end date. Analyzing annual spending patterns, including any fluctuations or increases/decreases in funding, would provide a clearer picture of the long-term financial commitment to these critical health IT systems. Without access to the full contract history and all modifications, a comprehensive trend analysis is limited to this specific award period.
How does the awarded amount compare to the estimated cost or ceiling of the contract?
The provided data lists the award amount as $185,212,518.76. However, it does not explicitly state the contract's estimated cost or ceiling. For Cost Plus Fixed Fee (CPFF) contracts, there is typically a ceiling that limits the total government liability. Without knowing this ceiling, it's difficult to definitively assess how close the awarded amount is to the maximum potential expenditure. If the $185.2 million represents the total value including fixed fee and estimated costs, and there was a higher ceiling, it suggests the government may have had room for additional work or potential cost increases. Conversely, if this amount is close to or at the ceiling, it indicates a full utilization of the contract's financial scope.
What are the key performance indicators (KPIs) used to measure the success of this contract?
While specific KPIs are not detailed in the provided data, contracts for critical IT systems like CHCS/AHLTA typically include performance metrics focused on system availability, uptime, response times, and user support. Key Performance Indicators (KPIs) would likely measure the reliability and performance of the health IT infrastructure, ensuring continuous operation for healthcare providers. Other KPIs might include the successful implementation of system updates, resolution times for reported issues, and adherence to security protocols. The Defense Health Agency would establish these KPIs in the Performance Work Statement (PWS) to ensure the contractor meets the required service levels and maintains the integrity and functionality of the health systems.
What is Leidos, Inc.'s track record with similar large-scale federal IT health contracts?
Leidos, Inc. has a substantial track record in providing IT services to the federal government, including significant engagements within the healthcare sector. They are a major contractor for the Department of Defense and other health-focused agencies. Their experience often includes managing complex systems, electronic health records, and large-scale IT infrastructure projects. While specific details of past performance on CHCS/AHLTA are not in this data snippet, Leidos's general profile suggests they possess the scale and expertise required for such contracts. A thorough assessment would involve reviewing their performance on other large health IT contracts, including any past performance evaluations or awards.
What are the potential risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this service?
The Cost Plus Fixed Fee (CPFF) contract type, used here, presents specific risks. For the government, the primary risk is that the contractor may have less incentive to control costs compared to fixed-price contracts, as the government bears the cost of all allowable expenses plus a predetermined fixed fee. This can lead to cost overruns if not managed diligently. For the contractor, the risk lies in accurately estimating costs to ensure the fixed fee is sufficient to cover their overhead and profit. Effective oversight, detailed cost tracking, and robust negotiation are crucial to mitigate the government's risk of paying more than necessary. The fixed fee itself is negotiated upfront, providing some cost certainty for the contractor's profit margin.
How does this contract contribute to the overall modernization goals of the Defense Health Agency?
This contract, focused on CHCS/AHLTA, directly supports the Defense Health Agency's (DHA) mission by ensuring the continued operation and potential enhancement of core components of the Military Health System's (MHS) electronic health record infrastructure. CHCS and AHLTA are foundational systems that manage patient records, appointments, and clinical data for millions of service members and their families. By awarding this contract, the DHA aims to maintain the stability and functionality of these systems, which is a prerequisite for any future modernization or integration efforts. It ensures that healthcare providers have access to reliable patient information, thereby supporting the delivery of quality care and maintaining medical readiness.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 11951 FREEDOM DR, RESTON, VA, 20190
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $212,450,188
Exercised Options: $204,100,370
Current Obligation: $185,212,519
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: 263010046
IDV Type: IDC
Timeline
Start Date: 2011-09-29
Current End Date: 2014-05-31
Potential End Date: 2014-05-31 00:00:00
Last Modified: 2023-07-12
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