CMS awarded Accenture no-bid contract on Healthcare.gov

The Centers for Medicare and Medicaid Services did not believe CGI Federal, its former Healthcare.gov contractor, could complete its work on the site in time, and thus selected Accenture as the new contractor with a no-bid $90 million-plus contract, according to documents.

In the ‘Justification for Other than Full and Open Competition,’ posted on FedBizOpps.gov, CMS wrote that the “current FFM development contractor is not going to be able to complete the development of the required functionality by the required date,” of which CMS wrote is an “urgently needed” functionality and “critical to the successful national deployment of the marketplace.” Further, CMS said that if the functionality is not done by mid-March 2014 it will result in financial harm to the government, who could lead to erroneous payments to providers and insurers.

The normal lead time for an open competition is six to 12 months, but CMS said in its justification for the no-bid that the Centers “require [Accenture] to perform the urgently required services.”

The main functionality CMS is referring to is the financial management platform, which was originally expected to be built by mid-January. On Jan. 16, Gary Cohen, director of the Center for Consumer Information and Insurance Oversight, said in testimony on Capitol Hill that the system was still being built and he did not have a timeframe for completion.

In the document, CMS says it realized CGI Federal — which is not directly named — would be unable to complete the work in early December 2013, after the contractor failed to deliver software and services needed to process enrollments.

Also included in the Accenture contract are call center representatives, direct enrollment integrations, Form 834 re-processing and other duties that were limited in scope due to “defects” by the original contractor.

The one-year contract awarded to Accenture will begin following a transition period. CGI’s contract was originally scheduled to conclude on Feb. 28. When the Accenture contract was announced, CMS made no mention that this was a no-bid contract. The total estimated value of the one-year deal with Accenture is $91.1 million and about $2 million in travel costs.

CMS says it used data from MITRE to select from a dozen companies for the contract and met with four of the companies, which the Centers do not name. CMS said Accenture was selected in part for its work on building the state marketplace in California. CMS and CGI did not return a request for comment.