Leidos awarded $31.7M for MHS Genesis deployment, facing competition and requiring extensive site prep
Contract Overview
Contract Amount: $31,658,584 ($31.7M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2021-07-14
End Date: 2023-03-31
Contract Duration: 625 days
Daily Burn Rate: $50.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIXED PRICE INCENTIVE
Sector: IT
Official Description: DEPLOYMENT SERVICES FOR MHS GENESIS, INCLUDING SITE PREPARATION, DEPLOYMENT, TRAINING, CHANGE MANAGEMENT, AND POST-INSTALLATION SUPPORT REQUIRED TO DEPLOY THE ELECTRONIC HEALTH RECORD SOLUTION TO THE SITES IN EACH WAVE.
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $31.7 million to LEIDOS, INC. for work described as: DEPLOYMENT SERVICES FOR MHS GENESIS, INCLUDING SITE PREPARATION, DEPLOYMENT, TRAINING, CHANGE MANAGEMENT, AND POST-INSTALLATION SUPPORT REQUIRED TO DEPLOY THE ELECTRONIC HEALTH RECORD SOLUTION TO THE SITES IN EACH WAVE. Key points: 1. Contract value of $31.7M for comprehensive electronic health record deployment services. 2. Full and open competition indicates a potentially competitive bidding process. 3. Fixed Price Incentive contract type suggests shared risk between government and contractor. 4. Deployment services include site preparation, training, and change management. 5. Contract duration of 625 days covers a significant implementation period. 6. Focus on MHS Genesis, a critical military health system modernization effort.
Value Assessment
Rating: good
The contract value of $31.7M for deploying an electronic health record system appears reasonable given the scope of services, which include site preparation, training, and change management. Benchmarking against similar large-scale IT system deployments within the federal government suggests this pricing is within expected ranges. The fixed-price incentive structure also implies a focus on cost control and performance, potentially leading to better value if targets are met.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but this procurement method generally fosters price discovery and allows the government to select from a wide pool of qualified contractors. The competitive nature is expected to drive more favorable pricing and service terms.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at a fair market price and encourages innovation among potential bidders.
Public Impact
Benefits military personnel and their families by modernizing the electronic health record system. Delivers essential IT services for the Department of Defense's Defense Health Agency. Impacts numerous military treatment facilities across various locations through phased deployment. Requires a workforce skilled in IT deployment, training, and change management.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if incentive targets are not met or scope creep occurs.
- Dependence on contractor performance for timely and effective system deployment.
- Risk associated with integrating a complex system into existing military healthcare infrastructure.
Positive Signals
- Fixed Price Incentive contract aligns contractor and government interests in successful delivery.
- Full and open competition suggests a robust selection process and potential for competitive pricing.
- Experienced contractor (Leidos) with a track record in large-scale IT projects.
Sector Analysis
This contract falls within the Computer Systems Design Services sector, a significant segment of the federal IT market. The MHS Genesis program represents a major modernization effort for military healthcare, requiring specialized deployment and integration services. Comparable spending in this sector often involves large, complex system implementations for agencies like the Department of Defense, where costs can range from millions to billions depending on the scale and complexity.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside. However, the prime contractor, Leidos, may engage small businesses as subcontractors for specific components of the deployment, which would contribute to the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Health Agency (DHA) through contract officers and technical representatives. The fixed-price incentive structure includes performance metrics that are likely monitored to ensure accountability. Transparency is generally maintained through contract award databases and reporting requirements, though specific oversight details are not provided in this data.
Related Government Programs
- MHS Genesis Program
- Electronic Health Records
- Defense Health Agency IT Modernization
- Military Health System Services
Risk Flags
- Potential for schedule slippage
- Risk of cost overruns
- User adoption challenges
- Integration complexity with existing systems
Tags
it-services, defense, health-it, electronic-health-records, deployment-services, fixed-price-incentive, full-and-open-competition, department-of-defense, defense-health-agency, leidos-inc, mhs-genesis, virginia
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.7 million to LEIDOS, INC.. DEPLOYMENT SERVICES FOR MHS GENESIS, INCLUDING SITE PREPARATION, DEPLOYMENT, TRAINING, CHANGE MANAGEMENT, AND POST-INSTALLATION SUPPORT REQUIRED TO DEPLOY THE ELECTRONIC HEALTH RECORD SOLUTION TO THE SITES IN EACH WAVE.
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 $31.7 million.
What is the period of performance?
Start: 2021-07-14. End: 2023-03-31.
What is Leidos's track record with large-scale federal IT deployments, particularly in healthcare?
Leidos has a significant track record in executing large-scale federal IT contracts, including extensive work within the Department of Defense and other health-related agencies. They have been involved in various aspects of IT modernization, system integration, and cybersecurity for government clients. While specific details on their performance for MHS Genesis prior to this award are not detailed here, their history suggests experience with complex projects. Past performance evaluations and contract award histories would provide a more granular view of their success rates, on-time delivery, and budget adherence in similar federal healthcare IT initiatives.
How does the $31.7M contract value compare to similar MHS Genesis deployment phases or other EHR implementations?
The $31.7M value for this specific deployment phase of MHS Genesis appears to be a component of a much larger overall program cost. EHR implementations are notoriously expensive and complex. Comparing this single contract value requires understanding the scope of services (site prep, deployment, training, change management) and the number of sites or waves covered. For context, the total MHS Genesis program is valued in the billions. This $31.7M award represents a specific delivery order under a larger contract vehicle, likely for a defined set of tasks and locations. Benchmarking against other federal EHR projects, such as those for the VA or other large agencies, would show similar multi-million dollar figures for specific deployment phases, highlighting the significant investment required for such critical infrastructure.
What are the primary risks associated with this contract, and how are they mitigated?
Primary risks include potential schedule delays due to the complexity of site preparation and integration into existing military infrastructure, cost overruns if incentive targets are missed or scope expands, and user adoption challenges during the change management process. Mitigation strategies are embedded in the contract type: the Fixed Price Incentive (FPI) structure incentivizes Leidos to meet performance targets efficiently, sharing in cost savings or overruns. The full and open competition likely selected a vendor with demonstrated experience, reducing performance risk. Additionally, the phased deployment approach allows for lessons learned to be applied to subsequent waves, and the contract duration of 625 days provides a substantial timeframe for execution.
How effective is the 'full and open competition' strategy in ensuring value for money for this type of IT service?
Full and open competition is generally considered the most effective strategy for ensuring value for money in federal IT procurements. It maximizes the pool of potential offerors, fostering a competitive environment that drives down prices and encourages innovation. For a complex service like deploying an electronic health record system, this approach allows the Defense Health Agency to solicit proposals addressing specific technical requirements and performance metrics. By evaluating proposals based on both price and technical merit, the agency can select the offeror best positioned to deliver the required services efficiently and effectively, thereby maximizing taxpayer value. The absence of specific bidder numbers prevents a definitive assessment of the *degree* of competition, but the strategy itself is sound.
What are the historical spending patterns for MHS Genesis deployment or similar EHR projects within the DoD?
Historical spending on the MHS Genesis program, and similar large-scale EHR initiatives within the DoD, has been substantial, often spanning multiple years and billions of dollars in total. This specific $31.7M award is a delivery order under a larger contract, reflecting a portion of the overall investment. Previous phases and related contracts for MHS Genesis have involved significant expenditures for software development, hardware, integration, training, and deployment services. Spending patterns are characterized by large, multi-year commitments and a focus on modernization efforts to replace legacy systems. The DoD's investment in MHS Genesis is part of a broader trend across federal agencies to digitize and integrate health records for improved efficiency and patient care.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 1750 PRESIDENTS ST, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $31,658,584
Exercised Options: $31,658,584
Current Obligation: $31,658,584
Subaward Activity
Number of Subawards: 56
Total Subaward Amount: $33,719,720
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0003915D0044
IDV Type: IDC
Timeline
Start Date: 2021-07-14
Current End Date: 2023-03-31
Potential End Date: 2023-03-31 00:00:00
Last Modified: 2024-09-11
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