Updated September 9, 2024
Awardee Name: GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.
Unique Entity ID: SMNWM6HN79X5
Total Contract Value: $59,437,256.45
Action Obligation: $31,850,465.33
Department Name: HEALTH AND HUMAN SERVICES, DEPARTMENT OF
Funding Agency: CENTERS FOR MEDICARE AND MEDICAID SERVICES
Number of Bidders: 1
Award ID: 75FCMC24F0195
Referenced IDV ID: HHSM500201600005I
Contract Vehicle: CMS SPARC
Major Program Supported: STRATEGIC PARTNERS ACQUISITION READINESS CONTRACT (SPARC) PROGRAM
NAICS: 541512
Start Date: 2024-09-12
Ultimate Completion Date: 2026-09-11
Added September 9, 2024
CMS is proposing to extend the current Medicare Secondary Payer Systems Contractor (MSPSC) task order to ensure the completion of several initiatives, including the VHA Medicare Duplicate Payment Recovery project, ReMAS Batch Modernization, and Claims Filtering using Machine Learning. The extension will allow CMS to address project delays, ensure system stability, and implement necessary changes such as the imposition and tracking of Civil Money Penalties for reporting noncompliance. The continuity of the current contractor is essential to minimize risks, ensure accuracy, and avoid disruptions during critical project phases.
Contract Award Date: Sep 09, 2024
Contract Award Number: HHSM-500-2016-00005I
Task/Delivery Order Number: 75FCMC240195
The Medicare Secondary Payer (MSP) program is under the Office of Financial Management (OFM), Financial Services Group (FSG), and the Division of Medicare Secondary Payer Operations (DMPO). The program involves functions performed to identify when another payer has payment responsibility before Medicare to pay claims in the proper order and to recover Medicare primary payments made when another payer held primary responsibility. The MSPSC supports all the Medicare MSPS and initiatives for the Coordination of Benefits (COB) and Medicare Secondary Payer Recovery (MSPR).
CMS has an established centralized Coordination of Benefits (COB) and Medicare Secondary Payer Recovery (MSPR) program that supports the collection, management, and reporting of other insurance coverage of Medicare beneficiaries, and the collection of conditional payments or mistaken primary payments. This program provides quality customer service and a single source to Medicare
providers, suppliers, beneficiaries, insurers, and other stakeholders by streamlining the MSP data and debt collection processes while ensuring the integrity of the Medicare Trust Funds.
The independent contracts that support and manage the major functions of this program are:
• Benefits Coordination and Recovery Contractor (BCRC)
• Medicare Secondary Payer Integration Contractor (MSPIC)
• Commercial Recovery Contractor (CRC)
• Workers’ Compensation Review Contractor (WCRC)
• Medicare Secondary Payer Systems Contractor (MSPSC)
These contractors work in concert to encompass all the activities necessary to ensure that the primary payer (whether it is Medicare, employer insurance or other insurance) pays first, then identify claims that were paid conditionally or mistakenly paid as Medicare primary and pursue recovery in the most cost effective and efficient manner.
The MSPSC provides CMS with support for ongoing systems maintenance, development, enhancements, and special projects tied to CMS requirements for Medicare Secondary Payer Systems (MSPS). Development, maintenance, and enhancement activities includes, but not be limited to, systems analysis, design, database maintenance support, programming, unit/system/string/regression testing, data analysis, system documentation, quality assurance, and ad-hoc queries.
Additionally, this contract provides data center hosting and support for mainframe and mid-tier processing, production, validation, development, training environments, along with necessary disaster recovery capabilities and security measures that meet IRS Publication 1075 requirements.
Using the authority provided by this justification, the planners contemplate a contract action including one year of severable services as described above, from date September 12, 2024, to September 11, 2025, followed by a one-year option period from date September 12, 2025, to September 11, 2026.
3. Authority and Rationale:
The Contracting Officer shall give every awardee a fair opportunity to be considered for a delivery/task order exceeding $3,500 unless one of the following statutory exceptions applies. FAR 16.505(b)(2). Mark the applicable exception:
☐ The agency need for the supplies or services is so urgent that providing a fair opportunity would result in unacceptable delays [FAR 16.505(b)(2)(i)(A)];
☐ Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized [FAR 16.505(b)(2)(i)(B)];
☒ The order must be issued on a sole-source basis in the interest of economy and efficiency because it is a logical follow-on to an order already issued under the contract, provided that all awardees were given a fair opportunity to be considered for the original order [FAR 16.505(b)(2)(i)(C)]; or
Under the current MSPSC task order, there are initiatives that will extend beyond the current MSPSC completion date on September 11, 2024. These include the VHA Medicare Duplicate Payment Recovery project, ReMAS Batch Modernization and the Claims Filtering Project Go-Live Utilizing Machine Learning.
The VHA Medicare Duplicate Payment Recovery project is a legislation prompted collaboration between CMS and the VHA that will establish an interface to identify
(1) those VHA enrolled beneficiaries who are also enrolled as Medicare beneficiaries, (2) specific claims where VHA and Medicare made duplicate payments for the same health care services, and (3) potential fraud, waste, and abuse. Specifically, CMS will use VHA beneficiary and claims information to identify those VHA beneficiaries who are also enrolled in Medicare and where Medicare made payment on claims for which VHA also made payment. Any claims where both the VHA and CMS made payment will be reviewed by the agencies and recoupment action initiated as appropriate. CMS recoveries will be made in accordance with the Medicare recovery laws and statutes. The purpose of this initiative is for CMS to address OIG findings and to implement controls to address duplicate payments for services provided to individuals with Medicare and Veterans Health Administration benefits based on OIG Final Report: A-09-22.
The project involves multiple stakeholders (e.g., Veteran’s Health Administration (VHA), CMS, and the Integrated Data Repository (IDR). The scale of this collaboration is currently posing a heightened schedule risk for completion. Due to delays in project implementation, such as a deferred interagency engagement meeting and delayed Integrated Date Repository (IDR) technical support, the project
start date was deferred five months from September 2023 to February 2024, pushing the forecasted completion date to after September 2024. It is not in CMS’ best interest to recompete and award a contract while in the middle of implementation with an external agency, because the purpose for this initiative is for CMS to address OIG findings and to implement controls to address duplicate payments for services provided to individuals with Medicare and Veterans Health Administration benefits based on OIG Final Report A-09-22.
The REMAS Batch Modernization is a multi-year project to migrate all on-prem batch processing to the AWS environment. The success of the implementation of REMAS Batch Modernization requires batch performance to meet or exceed current processing timeframes and all warranty items to be resolved prior to the end of the current contract. Due to shifting CMS priorities, the current go-live date is now June 2024, and any stoppage will significantly impact implementation and project success. Any unforeseen delays can place CMS with minimal time remaining for testing, defect resolution and an unfulfilled warranty period. Having an unfinished project would place CMS in a difficult position while transitioning the contract and potentially require additional funds to retain staff and complete the project without
the original team.
The Claims Filtering Machine Learning is developed to create claim filtering algorithms that will ultimately reduce the number of disputes and appeals for MSP recovery cases. There are two main objectives to this initiative. The first is to eliminate the inclusion of claims within a recovery case that are unrelated to the services/injury associated with the incident, which results in multiple manual steps and processes to correct thereby reducing the number of disputes and appeals for MSP recovery cases.
The project is contingent on the REMAS Batch Modernization Project and requires the continuity of the current team of Machine Learning Specialists for successful execution. The current budget and timeline do not account for ramp-up and trial and error of a new contractor. Accuracy must meet expectations and as this project includes specific time frames and systemic contingencies, the incumbent must continue to perform these requirements to limit cost, schedule, and programmatic risks associated with transfer of knowledge to a new contractor amid development and implementation. The current timeline for validation takes place between June 2024 and November 2024. Implementation of the first cohort is scheduled to begin in January 2025. The follow-on order will allow CMS to complete the processing and testing of all the claims cohorts for accuracy A two-year period of performance is required to fix any defects, implement change requests (CR)’s related to ReMAS Batch Go-Live, perform testing and develop additional code. The Contractor will also develop identification of relatedness for claims, add options to indicate which claims were removed, develop training models to use, and load predictions to ReMAS Database Trigger. The Contractor will also work with the appropriate CMS Integrated Data Repository (IDR) and VHA contractors to define information needed to facilitate the identification of VHA/Medicare dual eligible individuals. As well as designing, developing, and implementing a solution to match the VHA beneficiary data to the Medicare enrolled beneficiaries (Part A and B only), designing, developing, and implementing a solution to generate a duplicative claim payment response file, implement a solution to initiate recovery for Medicare paid claims when a VHA payment was also made, and report and design, develop, and implement a solution to report and display status of matching and recovery initiation for Medicare duplicate payments.
In addition to these initiatives, the contract extension is necessary to support the imposition and tracking of Civil Money Penalties, recovery and the storage of decisions related to payment of a penalties. 42 U.S.C. 1395y(b)(7)(B) & 42 U.S.C. 1395y(b)(8)(E) permits CMS to calculate and impose Civil Money Penalties (CMPs) when group health plan (GHP) and non-group health plan (NGHP) responsible reporting entities (RREs) fail to meet their Medicare Secondary Payer (MSP) reporting obligations. The rule, 42 CFR § 402.1, et seq., (effective on October 11, 2024) allows CMS to take steps to identify instances of potential non-compliance and propose penalties. However, due to the constraints placed on CMS under the Administrative Procedure Act (APA), CMS has not been permitted to take any steps towards implementation until recently. The provisions of the finalized regulations require systems changes that need to be implemented in two phases beginning January 2026 which is set to take place during the optional period for this follow-on order (i.e., September 2025 to September 2026 including transition to follow-on contract).
Phase One involves the implementation of system changes allowing CMS to audit arandom sample of 250 records added on a quarterly basis from across all reported records of a payer primary to Medicare (e.g., Section 111 mandatory insurer reporting, “self”-reporting, or other) for a total of 1,000 records to be reviewed annually. This sample will reflect a proportionate number of GHP and NGHP records,
which may vary each quarter as GHP and NGHP record volumes vary. When a sampled record is from a source other than Section 111 reporting, CMS will identify and review the associated Section 111 record for compliance. If the Section 111 record has not been successfully reported at the time of review, noncompliance will be determined based on the information supplied in the other record (e.g., the date of settlement).
Phase Two implements the imposition and tracking of Civil Money Penalties, recovery and the storage of decisions related to payment of a penalty. Because of statutory language differences, there are different penalty amounts and calculations for GHPs and NGHPs, with one involving a tiered approach and a maximum penalty amount while the other is potentially limitless. Depending on the situation, CMS could see penalties of tens of millions of dollars. Due to the potential financial impact on GHPs and NGHPs if such penalties are found to be appropriate and imposed, CMS anticipates a significant amount of scrutiny from stakeholders including Congress, and a heightened risk of litigation, especially in the earlier stages of implementation.
Consistency of data to support responses to the expected scrutiny and potential litigation is critical to the success of the program. A contract change during the early implementation of this rule presents an unacceptable risk to the integrity and accessibility of the necessary data; CMS must be prepared with quick and accurate data and other information. Delays and transition can impact this requirement, reducing CMS’s ability to defend and collect penalties where warranted, bring unwarranted criticism to CMS, and ultimately weakening essential enforcement authorities for a program that generates billions of dollars in savings for the Medicare trust funds.
It is in the best interest of the government to issue a follow-on task order to the current MSPSC contractor because of their extensive knowledge and experience of the MSP program. Transitioning this work prior to the implementation of these initiatives would create significant delays and jeopardize the program. There would be serious programmatic and cost implications.
As noted above, additional time is needed to support the implementation of these initiatives. The base period of the new award allows for the development and implementation. The option period is required to allow for continued development, testing and defect resolution of these projects. In addition, the option period will support the implementation of systems changes to support the tracking of Civil Money Penalties.
Once these systems are fully implemented and stable, CMS will be able to transition the operations and maintenance (O&M) to a new contract. The new contract for O&M is anticipated to begin 6 months prior to the end of the option period to allow for knowledge transfer and seamless transition.
See The full justification here – MSPSC+JA+09092024+REDACT_Redacted.pdf
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