Active Duty Dental Program contract awarded to United Concordia for $53.9M, supplementing care for service members

Contract Overview

Contract Amount: $53,942,307 ($53.9M)

Contractor: United Concordia Companies, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-01-27

End Date: 2022-06-30

Contract Duration: 154 days

Daily Burn Rate: $350.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: THE ACTIVE DUTY DENTAL PROGRAM SUPPLEMENTS DENTAL CARE PROVIDED IN DENTAL TREATMENT FACILITIES (DTFS)AND PROVIDES DENTAL SERVICES TO ACTIVE DUTY SERVICE MEMBERS WITHOUT ACCESS TO A DTF.

Place of Performance

Location: HARRISBURG, DAUPHIN County, PENNSYLVANIA, 17110

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $53.9 million to UNITED CONCORDIA COMPANIES, INC. for work described as: THE ACTIVE DUTY DENTAL PROGRAM SUPPLEMENTS DENTAL CARE PROVIDED IN DENTAL TREATMENT FACILITIES (DTFS)AND PROVIDES DENTAL SERVICES TO ACTIVE DUTY SERVICE MEMBERS WITHOUT ACCESS TO A DTF. Key points: 1. The contract aims to ensure adequate dental care for active duty service members, particularly those without direct access to military dental facilities. 2. Performance is tied to the delivery of dental services, indicating a focus on service availability and quality. 3. The contract's duration of 154 days suggests a short-term or bridge requirement, potentially for ongoing program support. 4. The fixed-price nature of the contract provides cost certainty for the government, assuming the scope of work remains stable. 5. This contract represents a portion of the broader healthcare spending within the Department of Defense, specifically for personnel support services.

Value Assessment

Rating: good

Benchmarking the value of this specific contract is challenging without more detailed cost breakdowns or comparisons to similar short-term supplemental dental care contracts. However, the fixed-price structure suggests an attempt to control costs. The awarded amount of $53.9 million for a 154-day period indicates a significant investment in ensuring dental readiness for active duty personnel. Further analysis would require comparing per-member per-month costs or service utilization rates against industry benchmarks for similar populations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process is generally expected to yield fair market pricing and encourage innovation. The specific number of bidders is not provided, but the open competition suggests a healthy market for these types of services.

Taxpayer Impact: Full and open competition is favorable for taxpayers as it drives down prices through market forces and ensures the government receives the best value for its investment.

Public Impact

Active duty service members benefit from supplemental dental care, ensuring readiness and well-being. The contract provides essential dental services, particularly for those stationed at locations lacking adequate military dental facilities. The geographic impact is nationwide, covering all active duty service members requiring access to civilian dental providers. Workforce implications include support for civilian dental professionals who provide services under this contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Short contract duration may indicate a need for ongoing, potentially recurring, supplemental services, raising questions about long-term strategic planning.
Lack of detailed performance metrics in the provided data makes it difficult to assess the effectiveness and quality of services delivered.
The specific 'supplemental' nature of the care could imply underlying issues with the capacity or accessibility of primary military dental facilities.

Positive Signals

Awarded through full and open competition, suggesting a robust market and potential for competitive pricing.
Fixed-price contract type provides cost predictability for the government.
Directly addresses the healthcare needs of active duty service members, contributing to military readiness.

Sector Analysis

The Active Duty Dental Program falls within the broader healthcare services sector, specifically focusing on managed care and insurance for government personnel. This contract is a component of the Defense Health Agency's efforts to provide comprehensive medical and dental support to the armed forces. The market for military healthcare services is substantial, with numerous large insurance carriers and healthcare providers competing for government contracts. This specific contract addresses a niche but critical need for supplemental dental care, ensuring that service members maintain dental health regardless of their proximity to military treatment facilities.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While United Concordia Companies, Inc. is a large entity, the contract does not explicitly detail subcontracting plans with small businesses. Further investigation into subcontracting reports would be necessary to determine the extent of small business involvement and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Health Agency (DHA), a component of the Department of Defense. Accountability measures are inherent in the fixed-price contract structure, requiring the contractor to deliver specified services within the agreed-upon budget. Transparency is facilitated through contract award databases, although detailed operational performance data may be less publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

TRICARE Dental Program
Active Duty Dental Care Program
Military Health System
Department of Defense Healthcare Services

Risk Flags

Short contract duration may indicate a recurring need or a gap-filling measure.
Potential for performance issues if network adequacy or service quality is not maintained.
Dependence on a single large contractor for a critical service component.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $53.9 million to UNITED CONCORDIA COMPANIES, INC.. THE ACTIVE DUTY DENTAL PROGRAM SUPPLEMENTS DENTAL CARE PROVIDED IN DENTAL TREATMENT FACILITIES (DTFS)AND PROVIDES DENTAL SERVICES TO ACTIVE DUTY SERVICE MEMBERS WITHOUT ACCESS TO A DTF.

Who is the contractor on this award?

The obligated recipient is UNITED CONCORDIA COMPANIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Health Agency).

What is the total obligated amount?

The obligated amount is $53.9 million.

What is the period of performance?

Start: 2022-01-27. End: 2022-06-30.

What is the historical spending trend for the Active Duty Dental Program, and how does this $53.9M award compare?

Analyzing historical spending for the Active Duty Dental Program requires access to detailed budget and award data over multiple fiscal years. Without this specific historical data, it's difficult to definitively state how the $53.9 million award compares. However, the program's nature suggests consistent funding needs to supplement dental care for active duty members. If this contract represents a full year's funding or a significant portion thereof, it indicates a substantial program cost. Typically, such programs see annual expenditures in the tens to hundreds of millions of dollars, depending on enrollment, service utilization, and contract scope. A year-over-year comparison would reveal if this award signifies an increase, decrease, or stable funding level for this specific service component.

How does the per-member cost of this contract compare to other government dental insurance programs or commercial benchmarks?

To compare the per-member cost, we would need to know the number of active duty service members covered by this specific $53.9 million contract over its 154-day duration. Assuming this contract covers a significant portion of the active duty force needing supplemental care, we could estimate a per-member-per-month (PMPM) cost. For instance, if it covers 100,000 members for 5 months (approx. 154 days), the cost would be roughly $107.80 PMPM ($53.9M / 100,000 members / 5 months). This figure would then be benchmarked against TRICARE Dental Program costs, other federal employee dental plans, and commercial dental insurance PMPM rates. Generally, government-sponsored programs aim for costs competitive with or lower than commercial equivalents, but specialized populations or service levels can influence pricing.

What are the specific performance metrics and quality standards associated with this contract, and how is compliance monitored?

The provided data does not detail the specific performance metrics or quality standards for this Active Duty Dental Program contract. Typically, such contracts would include requirements related to appointment availability (e.g., wait times for routine and urgent care), network adequacy (ensuring sufficient providers in geographic areas), claims processing timeliness, and patient satisfaction. Compliance is usually monitored through regular reporting by the contractor, government surveillance, and potentially independent audits or reviews. The Defense Health Agency (DHA) would be responsible for establishing these metrics and overseeing the contractor's adherence to them. Failure to meet key performance indicators could result in contract modifications, penalties, or non-renewal.

What is United Concordia Companies, Inc.'s track record with similar government healthcare contracts, particularly within the Department of Defense?

United Concordia Companies, Inc. (now part of Elevance Health) has a significant history of administering dental benefits for various government programs, including the TRICARE Dental Program and the Active Duty Dental Program itself in previous contract cycles. Their experience includes managing large networks of dental providers, processing claims, and providing customer service to military members and their families. Their track record generally indicates substantial capacity and familiarity with the requirements of serving uniformed service members. However, like any large contractor, specific performance on individual contracts can vary, and past performance reviews would provide a more granular assessment of their success in meeting cost, schedule, and quality objectives.

What is the risk profile of this contract in terms of cost overruns, schedule delays, or performance failures?

The risk profile for this contract appears moderate. As a fixed-price contract, the primary risk of cost overrun lies with the contractor, United Concordia, rather than the government, assuming the scope of work remains consistent. Schedule delay risk is also primarily on the contractor, given the relatively short 154-day duration. Performance failure risk exists, as inadequate service delivery or network issues could impact active duty members' access to care. The 'supplemental' nature of the program implies it's designed to fill gaps, so failure to do so effectively would be a significant performance issue. Mitigation strategies would involve robust contract oversight by the Defense Health Agency, clear performance standards, and contingency planning for service disruptions.

How does this contract align with the broader strategic goals of the Defense Health Agency regarding military readiness and healthcare provision?

This contract directly aligns with the Defense Health Agency's (DHA) strategic goal of ensuring military readiness by maintaining the health and welfare of active duty service members. Dental readiness is a critical component of overall medical readiness, as dental emergencies or untreated conditions can impact a service member's ability to deploy or perform duties. By providing supplemental dental care, the DHA ensures that service members have access to necessary treatments, preventing minor issues from escalating into significant health problems or readiness inhibitors. This contract supports the DHA's mission to deliver a medically ready force and a ready medical force.

Industry Classification

NAICS: Finance and Insurance › Insurance Carriers › Direct Health and Medical Insurance Carriers

Product/Service Code: MEDICAL SERVICES › MEDICAL, DENTAL, AND SURGICAL SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HT940213R0002

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4401 DEER PATH RD, HARRISBURG, PA, 17110

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $81,807,519

Exercised Options: $81,807,519

Current Obligation: $53,942,307

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HT940214D0001

IDV Type: IDC

Timeline