10.27. Contexture SS Mod.docx

Sole Source Justification Guidance

SOLE SOURCE JUSTIFICATION GUIDANCE

SOLE SOURCE JUSTIFICATION FORM:

This completed form is to be submitted to PCU via cdphe_pcs@state.co.us as the first step in the Sole Source Process.

Important! Consult the document “Sole Source Justification Guidance” for additional instructions.

TYPE OR CLEARLY PRINT ALL INFORMATION

Project Name: Department level contract with Contexture Vendor name: Contexture Vendor Address: 2000 S. Colorado Blvd. Tower 1, STE 12000, Denver, CO 80222 Select one: ☐Original X Modification CORE Vendor ID:

PO or Contract Number (if this is a modification):

Describe the products and/or services to be procured and how they meet your needs. (This space is limited – provide a scope of work or specs as additional documentation)

Contexture will supply access to electronic health records through Patient Care 360 (PC360)/ One Platform licenses. In addition, Contexture shall develop and maintain an electronic dashboard OR deliver a monthly report, which demonstrates electronic delivery by Contexture of laboratory results originating from the CDPHE Laboratory.

List dates, agreement numbers and dollar amounts for any previously procured products or services from this vendor related to this project: N/A

Term of agreement:

(If multi-year, indicate the full term up to 5 years) Start Date

11/30/2028

amount $210,000.00

Increased

Total $350,000.00

If a modification, state the reason(s):

This modification to the Sole Source is being requested to increase the Sole Source allowable amount to reflect the actual annual spending to purchase these licenses and extend the Sole Source by one month to align with the calendar year.

A. Criteria: Answer both 1 and 2.

If “NO” to either 1 or 2, answer 3 and 4, below.

3. The compatibility of equipment, software, accessories, or replacement parts is the paramount consideration and the items are only available from one vendor.

a. Is this a software package or other IT system and the existing system now requires only ongoing maintenance and support?

If “NO” to 1-4, above, this is not a sole source.

STOP

A formal solicitation is required. Complete a Purchasing Determination Form.

Submit all required documents via the PCU Request Site.

B. Explain in terms of 1 through 4, above, the basis for your identifying this as a sole source? A sole source is justified in the instance that this is the only vendor - not what the program may determine to be the best vendor. Is this the only vendor? Explain (See form instructions)…

Contexture is the only Health Information Exchange (HIE) that services all of Colorado. The PC360 / One Platform service allows license holders to view electronic health records of patients in health care systems that send data to Contexture, which includes all major health care organizations in Colorado. For users, this allows them to examine health records of patients involved in a public health investigation thereby allowing quick and reliable access to information to prevent the spread of disease in Colorado.

The CDPHE laboratory depends on electronic messaging to help deliver test results to clinicians throughout Colorado. This includes time sensitive results such as Newborn Screening and COVID-19. Contexture is where the majority of the state lab's test requests originate. Electronic test reporting between the state lab is already established through Contexture's provider network and is critical to providing the highest quality testing to the people of Colorado.

This modification to the Sole Source is being requested to increase the Sole Source allowable amount to reflect the actual annual spending to purchase these licenses and extend the Sole Source by one month to align with the calendar year. Note this purchase did not start on the Sole Source allowable date, but rather several months later on 3/11/24.

3/11/2024 - 12/31/2024, PO 2024-8018, $59,661.43

1/1/2025 - 12/31/2025, PO 2025-6095, $72,540.00

1/1/2026 - 12/31/2026, PO 2026-6170, $62,640.00

Current Total: $194,841.43

C. What makes this good or service unique to meeting your needs?

Contexture is the only organization that provides access to PC360 / One Platform which includes electronic health records for all major health care organizations in Colorado. In addition, it is also the organization where the majority of the state lab’s test requests originate.

E. What type of required, specific and exclusive experience, certifications, licenses etc. are possessed by this vendor that directly relate to the good or service to be procured?

The license specific to Contexture is called Patient Care 360 (PC360) / One Platform.

F. What research has the program conducted to justify this sole source?

Research has consisted of conversations with Contexture and use of PC360 / One Platform by approximately 150 users across the Department.

If Yes: Please Explain. (This space is limited – please provide additional documentation if applicable.)

H. This Section is Required – You must answer “Yes” to at least one.

If No to #3 above:

Demonstrate how you determined fair and reasonable prices/rates: Attach additional pages if required.

Comparison to a similar service that used to be offered by QHN, the other health information exchange in Colorado (documentation attached) when this sole source was first issued. QHN has since merged with Contexture. Contexture has applied a small inflationary price increase to these licenses each year.

Division: DCPHR Program: EDR, CDB, Lab Program Contact Name: Anita Watkins Phone: 303-692-2404 Program Manager: Anita Watkins

**An aggrieved party may file a protest concerning a material issue(s), at any phase of solicitation.

Reference §24-109-102, C.R.S., as amended, and Procurement Rule R-24-109-102-01, et seq.

-------------------------- Procurement Use Only:------------------ Comments:

Approved: __________________________________________________________________________ Agency Procurement Director or Authorized Representative Signature Date Posted on VSS? Yes ☐ No ☐ If posted, original Intent to Sole Source VSS# __________________________________________

If not posted or modified, Approved CDPHE Request #: _______________________________________

SOLE SOURCE SUMMARY

Sole Source Procurements are allowed by the Procurement Code when:

• There is only one Good or Service that will meet the need of the State AND There is only one Vendor that can supply that Good or Service.

If a proprietary item is required, a sole source circumstance may exist where:

• The compatibility of equipment, accessories, or replacement parts in the paramount consideration and the items are only available from one vendor

• A sole supplier’s item is needed for trial use or testing

1. A program wishing to purchase proprietary goods in excess of $10,000 or proprietary services in excess of $25,000 must complete the Sole Source Justification Form and submit to the Procurement Director for approval prior to negotiating a contract or purchase order. (Not required for interagency or governmental agencies). Please note: Insufficient time for solicitation of Bids is not an allowable reason to proceed with the “Sole Source” procurement.

2. If the Procurement Director approves the Sole Source Justification Form, the request on the PCU site will be approved and the final documents attached. Once the program has received the approval they can move forward with the next step of contract or purchase order development.

3. The Procurement Director may require the project to be posted as an Intent to Sole Source, or may not agree the Vendor is the sole source, and require competition be solicited. The Procurement Director will indicate the next steps to be taken for the appropriate solicitation method at this time.

INTENT TO SOLE SOURCE

Competition must be solicited if doubt exists whether a Sole Source Procurement is appropriate. In this event, PCU will post a “Notice of Intent to Sole Source (NPSS1) on Vendor Self Service (VSS) to assist in the determination. The request will be posted as “Notice of Intent to Sole Source” to the VSS system for a minimum of 3 business days. The Procurement Director reserves the right to post the notice for a longer period if determined necessary.

After a posting on VSS, if no respondents expressed valid interest in the work, Purchasing will notify the program to proceed with a sole source. The Program will include the completed and approved Sole Source Justification Form and the approved request number in their contract or purchase order packet.

If there are respondents to the “Notice of Intent to Sole Source” that expressed valid interest in the work, Purchasing will notify the program of this interest and discuss a possible need to proceed with the competitive solicitation process.

COST AND PRICE ANALYSIS--AN EXPLANATION

(Parts excerpted from the Florida State University Office of Research Contracts and Grants guidance) Both sole source and emergency procurements require a written determination by the head of a purchasing agency, or a designee, of the basis for the approval. This form is designed for approval of a “sole source,” not an emergency procurement. Consult with your procurement official regarding requirements for emergency procurements.

Normally, price analysis is not done in competitive solicitations where “adequate competition” exists, because the competitive process takes care of the “fairness and reasonableness” of prices. However, in a sole source situation where no price competition exists, some analysis must be done to insure that the requirements of the controller’s statute (Part 2, Title 24, Article 30, C.R.S.) are met, i.e., that prices or rates are “fair and reasonable.”

Some form of price or cost analysis should be performed in connection with every procurement action, regardless of whether the organization is a vendor or a subrecipient. The form and degree of analysis, however, are dependent on the particular subcontract or purchase, and the pricing situation. Determination of price reasonableness through price or cost analysis is required even though the procurement is source-directed by the contracting officer of the sponsoring agency.

In some purchases, price analysis alone will be sufficient; in others, price analysis will be used to corroborate the conclusions arrived at through cost analysis. The form and degree of analysis are dependent on facts surrounding a particular subcontracting or purchasing situation. The scope of price analysis performed and the particular techniques used will depend on whether or not cost analysis is done, as well as on such factors as type of product or service, dollar value, purchase method, and extent of competition. (The words “vendor” and “subrecipient” used herein are interchangeable.)

It is important to remember that the information requested herein is based on Federal and State requirements. Please call PCU if you have questions about this information.

PRICE ANALYSIS

Price Analysis is the process of deciding if the asking price for a product or service is fair and reasonable, without examining the specific cost and profit calculations the vendor used in arriving at the price. It is basically a process of comparing the price with known indicators of reasonableness.

When adequate price competition does not exist, some other form of analysis is required.

Some reasons that could affect adequate price competition are: specifications are not definitive, tolerances are restrictive, or production capacity limits those eligible to bid.

In either case, even though neither historical nor market prices involve the identical service, some analysis can often be done which evaluates the differences in the types of services or goods, and concludes that the nature of the differences warrant the differences in pricing. In other cases, judgments must be made that proprietary aspects of the service or commodity warrant expenditure of the prices or rates in excess of what is customary.

Common methods of price/cost analysis include:

a. Comparison of prices and rates to established catalog prices or market prices. In a sole source situation, there commonly are similar prices or rates, e.g., those on price agreements that can serve as a guide to fairness or prices or rates proposed by a sole source provider. In some cases, e.g., some utilities, prices and rates are set by law or regulation (utility tariff rates).

b. Historical prices or rates for similar items or services procured in the past also serve as a guide to fair and reasonable prices.

Examples of other forms of price analysis information include:

• Analysis of previous prices paid

• Comparison of vendor’s price with the in-house estimate

• Comparison of quotations or published price lists from multiple vendors • Comparisons with official published federal government prices In cases where neither historical nor catalog prices exist, cost analysis must be used.

COST ANALYSIS

Cost analysis is the element-by-element examination of the estimated or actual cost of contract performance to determine the probable cost to the vendor. The goal is to form an opinion on whether the proposed costs are in line with what reasonably economical and efficient performance should cost.

Cost or pricing data, which should be provided by the contractor, are the means for conducting cost analysis. Such data provide factual information about the costs that the contractor says may be incurred in performing the contract. Cost analysis should be performed in those situations where price analysis does not yield a fair and reasonable price.

Cost analysis techniques are used to break down a contractor’s cost or pricing data so as to verify and evaluate each component. Some of the cost elements examined for necessity and reasonableness are materials costs, labor costs, equipment and overhead. These costs can be compared with actual costs previously incurred for similar work, the cost or pricing data received from other vendors, and independent cost estimate breakdowns.

Vendors may be asked to provide summary level detail of materials and labor costs, as well as markups and other indirect cost rates included in the price. Technical judgments concerning labor hours can be applied to labor hour rates to evaluate the reasonableness of the overall price. Reasonable profit, of course, is another element of price. Per 24-103-403 C.R.S., for noncompetitive acquisitions where neither historical nor catalog prices exist, vendors are required to submit cost or pricing data for purposes of conducting a cost analysis.

1 Version A 05.2026