Treasury's $22.1M dental insurance contract awarded to Cigna subsidiary, Connecticut General Life Insurance Company

Contract Overview

Contract Amount: $22,144,715 ($22.1M)

Contractor: Connecticut General Life Insurance Company

Awarding Agency: Department of the Treasury

Start Date: 2010-10-01

End Date: 2015-08-31

Contract Duration: 1,795 days

Daily Burn Rate: $12.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DENTAL INSURANCE FOR OCC EMPLOYEES.

Place of Performance

Location: BLOOMFIELD, HARTFORD County, CONNECTICUT, 06002, UNITED STATES OF AMERICA

State: Connecticut Government Spending

Plain-Language Summary

Department of the Treasury obligated $22.1 million to CONNECTICUT GENERAL LIFE INSURANCE COMPANY for work described as: DENTAL INSURANCE FOR OCC EMPLOYEES. Key points: 1. Value for money appears reasonable given the scope of dental insurance for OCC employees. 2. Full and open competition suggests a competitive bidding process. 3. Contract duration of nearly 5 years indicates a stable, long-term need. 4. The award was made under a Firm Fixed Price contract type, providing cost certainty. 5. The contract was awarded to a single entity, Connecticut General Life Insurance Company. 6. The North American Industry Classification System (NAICS) code 524210 points to Insurance Agencies and Brokerages.

Value Assessment

Rating: good

The contract value of $22.1 million over approximately 5 years for dental insurance for Office of the Comptroller of the Currency (OCC) employees is within a reasonable range for such services. Benchmarking against similar government-wide dental insurance contracts would provide a more precise value-for-money assessment. However, the fixed-price nature of the contract helps control costs for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. This typically leads to a more robust selection of offers and potentially better pricing due to market forces. The presence of 2 bids suggests a moderate level of competition for this specific contract.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through a competitive bidding process, ensuring the government receives the best value for its expenditure on employee benefits.

Public Impact

Employees of the Office of the Comptroller of the Currency (OCC) benefit from dental insurance coverage. The services delivered include the provision of dental insurance plans. The geographic impact is primarily within Connecticut, where the contractor is based, and wherever OCC employees are located. Workforce implications include ensuring the health and well-being of federal employees, contributing to retention and productivity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited innovation due to fixed-price contract structure.
Dependence on a single large provider could limit future flexibility if market conditions change.

Positive Signals

Stable provision of essential employee benefits.
Established contractor with likely experience in government contracts.
Competitive bidding process suggests a fair market price was achieved.

Sector Analysis

The contract falls within the Insurance Agencies and Brokerages sector (NAICS 524210). This sector is characterized by intermediaries that sell insurance and related products on behalf of insurance companies. Government contracts for employee benefits, such as dental insurance, are a significant part of this market, requiring providers to meet specific regulatory and service standards. Comparable spending benchmarks would involve analyzing other federal contracts for group health and dental insurance.

Small Business Impact

The provided data does not indicate any specific small business set-aside or subcontracting requirements for this contract. As a full and open competition award to a large insurance provider, the direct impact on small businesses within the insurance brokerage or administration space is likely minimal, unless the prime contractor engages them for specific services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Office of the Comptroller of the Currency (OCC) contracting officer and program officials. Accountability measures are inherent in the firm fixed-price contract type, requiring the contractor to deliver specified services. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not be publicly available.

Related Government Programs

Federal Employee Health Benefits Program
Federal Employees Dental and Vision Insurance Program (FEDVIP)
Group Health Insurance Contracts
Employee Benefits Administration

Risk Flags

Contract Duration
Single Bidder Competition
Price Stability

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $22.1 million to CONNECTICUT GENERAL LIFE INSURANCE COMPANY. DENTAL INSURANCE FOR OCC EMPLOYEES.

Who is the contractor on this award?

The obligated recipient is CONNECTICUT GENERAL LIFE INSURANCE COMPANY.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Office of the Comptroller of the Currency).

What is the total obligated amount?

The obligated amount is $22.1 million.

What is the period of performance?

Start: 2010-10-01. End: 2015-08-31.

What is the track record of Connecticut General Life Insurance Company (Cigna) in providing federal employee dental insurance?

Connecticut General Life Insurance Company, a subsidiary of Cigna, has a significant history of providing health and dental insurance to various groups, including federal employees. Cigna, through its subsidiaries, is a major player in the health insurance market and has participated in federal programs like the Federal Employees Health Benefits (FEHB) Program and the Federal Employees Dental and Vision Insurance Program (FEDVIP). Their experience suggests a capacity to manage large-scale government contracts, navigate regulatory requirements, and provide comprehensive dental coverage. Specific performance data for this particular contract (2010-2015) would require deeper analysis of contract performance reports and any associated award or termination actions.

How does the awarded price compare to similar federal dental insurance contracts?

Direct comparison of the $22.1 million contract value to similar federal dental insurance contracts requires access to a comprehensive database of government procurements with detailed service scope and employee demographics. However, considering the contract duration of approximately 5 years and the number of employees covered by the Office of the Comptroller of the Currency (OCC), the average annual cost per employee can be estimated. If we assume a coverage period of roughly 60 months (1795 days / ~30 days/month), the average annual cost is approximately $4.4 million ($22.1M / 5 years). This figure needs to be contextualized with the number of employees covered and the specific benefits offered. Without knowing the employee count, a precise per-member-per-month (PMPM) benchmark is impossible, but this annual expenditure is typical for large group dental insurance plans.

What are the primary risks associated with this dental insurance contract?

The primary risks associated with this dental insurance contract include potential cost overruns if the fixed-price contract does not adequately account for unexpected increases in healthcare utilization or provider costs, although the fixed-price nature mitigates this risk for the government. Another risk is contractor performance failure, where the provider may not meet service level agreements, leading to dissatisfaction among employees and potential disruptions in care. Ensuring adequate network adequacy and provider access across all employee locations is also a risk. Finally, changes in federal regulations or employee demographics could necessitate contract modifications or adjustments, introducing administrative and financial risks.

How effective was this contract in providing dental benefits to OCC employees?

The effectiveness of this contract in providing dental benefits to OCC employees can be assessed through several lenses. Firstly, the continuity of service from October 2010 to August 2015 suggests a successful delivery of the contracted insurance. Employee satisfaction surveys, utilization rates of dental services, and feedback regarding network access and quality of care would provide a more direct measure of effectiveness. Without access to such specific performance data, we infer effectiveness from the contract's completion and the absence of reported major issues. The competitive award process also suggests an intent to secure effective services at a fair price.

What are the historical spending patterns for dental insurance at the Department of the Treasury or its bureaus?

Historical spending patterns for dental insurance at the Department of the Treasury, and specifically the Office of the Comptroller of the Currency (OCC), would reveal trends in procurement, contract values, and provider choices over time. This $22.1 million contract awarded in 2010 represents a significant expenditure for dental benefits during that period. Analyzing prior contracts (pre-2010) and subsequent awards (post-2015) would illuminate whether spending has increased or decreased, if competition levels have changed, and if different insurance providers have been utilized. Such analysis is crucial for understanding long-term budget planning and identifying potential efficiencies or cost-saving opportunities in federal employee benefits procurement.

Industry Classification

NAICS: Finance and Insurance › Agencies, Brokerages, and Other Insurance Related Activities › Insurance Agencies and Brokerages

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: CC-09-HQ-R-1003

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cigna Corporation (UEI: 029053964)

Address: 900 COTTAGE GROVE RD, BLOOMFIELD, CT, 06002

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

Financial Breakdown

Contract Ceiling: $22,144,715

Exercised Options: $22,144,715

Current Obligation: $22,144,715

Contract Characteristics

Cost or Pricing Data: NO

Timeline