Attach 1_JA_Redacted.pdf

Control Number: FY26-0727

Controlled by: Defense Health Agency (DHA) Controlled by: DHMS-CD

POC: Chastity Hill; chastity.r.hill.civ@health.mil

1 June 2026

Justification and Approval (J&A) for Other than Full and Open Competition Revolutionary Federal Acquisition Regulation (FAR) Overhaul (RFO) Parts 6 and 12

Implemented by Class Deviation 2026-O0017, Revision 1

1. Identification of the Agency and Contracting Activity:

Defense Health Agency (DHA), DHA Contracting Activity (DHACA), Defense Healthcare Management Systems Contracting Division (DHMS-CD)

2. Nature and/or Description of Action being Approved:

This Justification & Approval (J&A) supports the use of other than full and open competition to support a sole-source bridge contract to Leidos, Inc. to continue to provide essential system reintegration, software licensing, and hosting services in support of the DOD Healthcare Management System Modernization (DHMSM®) Program Management Office (PMO) Electronic Health Record (EHR) system, known as MHS GENESIS. MHS GENESIS is a critical defense business system. This sole-source bridge contract will reduce in scope during the 12-month period and will facilitate transition to other service contractors while also establishing direct government relationships to solution providers. An optional six-month CLIN of service can be exercised if needed.

Background: The DHMSM PMO was established to acquire and field a configurable and scalable modernized EHR system to replace Department of War (DOW) legacy healthcare systems with a Commercial-Off-the-Shelf (COTS) EHR system that enables improved sustainability, flexibility, interoperability, and continuity of care. In support of this mission, the DHMSM PMO acquired MHS GENESIS, an integrated inpatient/outpatient EHR solution that allows for access to and sharing of common data, user interfaces, workflows, and business rules to the greatest extent possible. The DHMSM PMO awarded a 10-year IDIQ contract (Contract N00039-15-D-0044) to Leidos, Inc. on July 29, 2015, after a full and open competition. This original award and all awarded task orders end on July 28, 2026.

Leidos and its partners that form the Leidos Partnership for Defense Health (LPDH) created and deployed MHS GENESIS across the DOW enterprise. LPDH implemented an on-premises enclave to centrally host the solution. MHS GENESIS consists of inpatient and outpatient software solutions from an enterprise service bus, a suite of revenue cycle management capabilities, and interfaces to external systems to enhance capability delivery. Additionally, MHS GENESIS is supported by uniquely configured and integrated third-party clinical content, functional baseline content (such

(including formularies, device locations, and clinic information), solution-unique hardware, secure infrastructure, clinical application services, and turn-key operational management services in a contractor-provided enclave. The core of MHS GENESIS is interfaced with additional COTS solutions, including virtual and behavioral health capabilities from Converge, Enterprise TeleCritical Care (eTCC), Clinical AI Agent (CAA) and population health management and analytics from HealtheIntent.

In 2016, a justification for other than full and open competition was approved to procure operational management services in support of hosting the EHR. In 2018, the contract was modified in accordance with J&A Number JA-18-0052 to support the implementation of the United States Coast Guard (USCG) into MHS GENESIS and to establish a common, standardized baseline with the USCG and the Department of Veterans Affairs (VA).

Subsequently, the DHMSM PMO was chartered by the Assistant Secretary of War for Acquisition (see Acquisition Decision Memorandum dated June 2020) to manage a broader provide a single EHR for the federal health community and its beneficiaries.

While DOW and the USCG employ the MHS GENESIS solution, so too did the Reserve Components, the United States Military Entrance Processing Command (US MEPCOM), and the National Oceanic and Atmospheric Agency (NOAA).

The Government is executing a strategic shift in its acquisition approach in response to Executive Order 14222, which directs the Department of War to pivot away from reliance on a single Lead Systems Integrator and instead acquire capabilities directly from solution providers.

This shift emphasizes efficiency, innovation, and reduced reliance on monolithic, risk-averse contracting structures.

Consistent with this direction and informed by recent market research, the Government determined that transitioning to a modular contracting approach would better support competition, flexibility, and long-term sustainment of the MHS GENESIS ecosystem. The bridge contract is required to maintain operational continuity while the Government completes the foundational work necessary to implement this new model, including defining modular requirements, establishing acquisition strategies for discrete capability areas, and aligning procurements with commercial best practices focused on outcomes, flexibility, and value realization.

This action is therefore not a continuation of the current approach, but a time-limited transition mechanism to enable a fundamentally different and more competitive acquisition strategy. This functions as a bridge contract that allows the Government to complete these prerequisites while

The bridge contract ensures continuity of expertise, preserves system knowledge, and enables the Government to implement a deliberate transition strategy aligned with long-term modernization objectives.

The Government may issue task orders for some or all of the system integration, software licensing, hosting services, and new capability enablement (see Description of Supplies/Services below). The IDIQ with Leidos will provide Firm-Fixed-Price CLINs for sustainment and Time and Material CLINs for developmental requirements. The Government will also include an individual transition out CLIN on the IDIQ as a option to extend the period of performance for up to six months. This will allow the Government to retain the incumbent for

The Government may similarly issue task orders with a combination of base and option terms to tailor the periods of performance to facilitate competition at the earliest possible date. The estimated ceiling for the up-to-12-month period of performance (an optional six-month option can be exercised if needed), assuming all options are exercised, is . This structure also provides flexibility to progressively reduce the scope of work performed by the incumbent contractor as responsibilities transition to additional vendors.

The services described throughout this J&A are highly interdependent; thus, any delay will require additional time and funding, either of which would reasonably be expected to result in significant, negative impact to the operational effectiveness and deployable capabilities of this critical defense business system. As described below, the scope includes the services required to transition MHS GENESIS to the Capability Support phase as a Defense Business System.

The Government is not seeking to compete the MHS GENESIS solution (that is, an alternative to the EHR and the associated systems that comprise the existing solution) at this time because (1) MHS GENESIS was only recently deployed and has not fully entered the Capability Support (formerly known as sustainment) phase, (2) the Government is required by indicates that for smaller, less complex EHRs, it takes 3-5 years for commercial hospitals to realize a return on investment when changing to a new EHR system.

[i] See Pub. L. 110-181 (directed the Secretary of War and the Secretary of Veterans Affairs to jointly develop and implement EHR systems or capabilities that allow for full interoperability of personal health care information between DoW and VA); Pub. L. 113-66 (directed the Secretary of War and the Secretary of Veterans Affairs each to ensure that the electronic health record systems of DoW and VA are interoperable with an integrated display of data or a single electronic health record, and each to deploy modernized electronic health record software supporting clinicians of the Departments); Pub. L. 116-92 (instructed maintenance of the common configuration baseline for the electronic health record systems of DoW and VA, and to continually evaluate the state of configuration and the impacts on interoperability and promote the enhancement of such electronic health records systems.)

[ii] On July 1, 2017, the Secretary of the VA issued a Determination and Finding pursuant to 41 U.S.C 3304(a)(7) that it was in the public's best interest for VA to issue a solicitation directly to Cerner (now known as Oracle Health) for the acquisition of the EHR system being deployed by the DOW, specifically the DOD Healthcare Management System Modernization Program Management Office, in order to enable seamless healthcare to Veterans and qualified beneficiaries.

3. Description of Supplies/Services and Estimated Value:

MHS GENESIS is a system of systems, meaning that it contains interfaced EHR COTS product components from multiple sources (e.g., , etc.), which enable clinicians and beneficiaries to access a single record of care. It integrates inpatient, outpatient, and dental records, and improves communication among military hospitals, clinics, the VA, and civilian providers. Patients utilize a portal for seamless, secure messaging with providers and for access to their medical history. By standardizing clinical and business processes across the Military Health System (MHS), the platform enables consistent delivery of care and supports medical readiness for service members worldwide. The system supports clinical decision-making, patient safety, and operational readiness by ensuring that providers have timely access to accurate and complete medical information. MHS GENESIS plays a vital role in ensuring health, supporting readiness, and improving safety.

MHS GENESIS has enormous scale and complexity. MHS GENESIS is made up of 12 major subsystems with over 81 DOW, joint, or commercial interfaces across more than 1,000 end points and processes at least 20 million messages daily. MHS GENESIS has more than 975 workflows and more than 200 user roles, and it serves over 191,000 users and 9.6 million beneficiaries across 137 commands globally. MHS GENESIS contains more than 255 TB of Millenium data growing at 100 TB annually. DOW spent seven years, 2017-2024, migrating data from legacy sites into MHS GENESIS. MHS GENESIS is comprised of approximately 26,000 hardware and software assets to deliver capabilities that need to be scanned every 48 hours for cyber vulnerabilities (and remediated as necessary).

Leidos provides highly specialized services to support this large and complex EHR. The incumbent contractor personnel use processes and tools to manage this complex defense business system at an average system availability (including major subsystem components) exceeding 99%. The benefits of MHS GENESIS include enabling clinicians at all U.S. military hospitals and clinics worldwide to rely on its data to make better decisions and provide quality care require such high-level system availability. For example, if the system is not available for any period, there is a greater chance of medical error, providers may order duplicative or unnecessary tests, and delay of appropriate care may result. The incumbent contractor delivers MHS

GENESIS in a highly reliable and scalable manner. Scalability, that is, the ability of MHS GENESIS to adjust to changing demands such as increased activity, is critical for MHS GENESIS, which supports multiple federal agencies. Because Leidos acted as the systems integrator for the existing infrastructure and platform, the contractor currently maintains detailed operational knowledge of the multiple EHR COTS products, their interfaces, and how they interact and operate to adequately maintain, modernize, and optimize the MHS GENESIS system-of-systems. Maintaining this level of availability during the ongoing transition to a modular contracting approach requires continuity of system integration expertise and operational knowledge of the deployed MHS GENESIS environment.

Leidos is responsible for the integration and configuration of all MHS GENESIS EHR components. To implement the Congressional mandate to create an interoperable EHR, Leidos has developed the capability to configure the systems to work together and understands the potential impacts to MHS GENESIS when new clinical requirements are defined. In addition, Leidos has unique experience working with the Federal health community, which, as described above, includes a multitude of MHS GENESIS users within the Government, specifically

Leidos is responsible for the performance of all of its LPDH partners/vendors and has demonstrated its working knowledge of the strengths and weaknesses of each product manufacturer's delivery process. As is more fully explained below and under the Rationale Justifying the Use of the Statutory Authority Cited, without Leidos' specialized knowledge and experience, transitioning integration and sustainment responsibilities without an orderly transition period would introduce significant operational risk to MHS GENESIS users worldwide. Disruption or extended outage of the system could delay or interrupt clinical care and degrade operational readiness across the MHS.

Additionally, direct access to proprietary processes (e.g., ) is only available as a managed service within the LPDH-operated enclave. Access to these processes and tools will be replaced by a direct relationship with and transition to a technical integration contractor.

Finally, in addition to maintaining a functioning EHR, as the systems integrator, Leidos has institutional knowledge with respect to day-to-day operations. This institutional knowledge is the result of years of integration and deployment activities and requires a structured transition period to transfer to another contractor. Leidos crafted what the Government team colloquially allow the services to be delivered at scale. Much of this knowledge was developed through years of integration and deployment activities and historically has not existed in fully documented form. The bridge is required to migrate this knowledge to new contractors to support MHS GENESIS without interruption.

Broadly, the services that fall under this J&A are as follows:

Solution Access through Software Licensing and Subscriptions: In accordance with the will result in dozens of new Government contracts and are planned to be migrated in phases.

Under the current contractual construct, the incumbent contractor manages procurement and administration of enterprise software licenses for the suite of COTS products that comprise the MHS GENESIS system of systems. These licenses support the operation of the EHR platform and associated capabilities used across the DOW and its federal partners. The Government will transition certain licenses from Leidos and enter into new license maintenance agreements and subscription (SaaS or Software-as a-Service) agreements to provide continuity. The migration of the solutions to direct relationships with the Government will occur during the bridge period.

Hosting: The contractor is responsible for providing all hosting services or coordinating with another DOW contractor for hosting services. The MHS GENESIS solution uses both on-premises hosting as well as cloud-based hosting and leverages the DOW Information Technology networks, as well as the Defense Health Agency (DHA) infrastructure to enable communications between the MHS GENESIS solution and the Military Treatment Facilities (MTFs) worldwide. As the program continues its transition to cloud-based architecture, hosting responsibilities will increasingly shift toward commercial cloud infrastructure in accordance with DOW cloud policy and vendor-supported deployment models. This follow-on contract includes the until the direct relationship with can be established and transitioned to the Government during the bridge period. [iii]

System Integration: The contractor is responsible for connecting and maintaining all the interfaces that connect the software and subscription solutions that comprise MHS GENESIS to ensure smooth interaction and data flow. Duties include system/sustainment engineering, testing, cybersecurity/accreditation, system/database administration, and optimization efforts (technical and functional) of the current DHMSM portfolio of products and hardware refresh for solution specific proprietary hardware. During the bridge period, the incumbent contractor will transition toward a modular contracting approach in which discrete capability areas may be supported by additional contractors. The contractor will be required to deliver documentation of its sustainment processes and procedures and system interface configurations, among other deliverables. As part of the bridge period, the incumbent contractor will also be required to develop and refine documentation necessary to support transition of system integration and sustainment responsibilities to additional contractors supporting discrete capability areas within the MHS GENESIS ecosystem. This documentation will include operational procedures, configuration details, system interface descriptions, and other information necessary for third-party contractors to assume responsibilities without disruption to system operations.

in the exercise of the option will depend on the transition approach required to support the orderly transfer of responsibilities to newly awarded contractors.

[iii] The COTS vendors whose software comprises MHS GENESIS will choose which cloud offering they configure their software to be hosted in. The solution is configured only to migrate to the offering, and those migration and hosting services are part of this follow-on contract. The Government will leverage existing contracts that have satisfied applicable competition requirements for purchasing other commercial cloud hosting services.

Impact if Bridge Not Approved: Recent workforce disruptions, including the October 2025 shutdown furlough, have resulted in a measurable backlog of critical program activities across the MHS GENESIS sustainment and optimization efforts. This backlog impacted the execute transition planning activities necessary for future competition.

Absent the bridge contract, these delays would be further exacerbated, increasing operational risk system while executing its acquisition transition strategy.

4. Statutory Authority Permitting Other Than Full and Open Competition:

10 U.S.C. 3204(a)(1) as implemented by FAR 6.103-1 - Only one responsible source and no other supplies or services will satisfy agency requirements.

5. Rationale Justifying Use of Authority Cited:

Per 10 U.S.C. 3204(a)(1), the use of procedures other than competitive procedures is authorized when the property or services needed by the agency are available from only one responsible source or only from a limited number of responsible sources and no other type of property or services will satisfy the needs of the agency.

Based on market research and the directive provided in Executive Order 14222, the DHMSM PMO determined that replacing Leidos during the bridge period with a phased transition of responsibilities to additional contractors and direct relationships with solution providers would result in the best approach to fulfill the Agency's requirements.

The bridge contract supports a controlled transition from the current monolithic systems integrator construct to a modular acquisition approach in which discrete capability areas of the MHS GENESIS ecosystem will be competed separately among qualified contractors. Under this strategy, the incumbent contractor will maintain continuity of operations while supporting the onboarding of additional contractors responsible for specific functional areas. As these contractors assume responsibility for defined capabilities, the scope of work performed by the incumbent contractor will progressively decrease. This approach enables the Government to introduce competition as rapidly as practicable while maintaining the stability and availability of the deployed enterprise EHR environment.

Leidos has been the systems integrator for MHS GENESIS from initial creation to full deployment (as that term is used in DODI 5000.75) in March 2024. Leidos has unique operational knowledge of this system that would require a structured transition period to transfer to another contractor without disrupting operation of the system. MHS GENESIS supports clinical operations across the MHS and is relied upon by providers worldwide for patient care, medical readiness, and operational decision-making. Any extended disruption, degradation of system performance, or loss of data availability could negatively impact clinical workflows, Maintaining operational continuity of the enterprise EHR environment during this transition period is therefore critical to both patient safety and mission readiness.

Although MHS GENESIS is primarily implemented using COTS products, Leidos has overseen the integration of these otherwise distinct COTS products at a size and scale significantly greater than any other EHR in the world. The incumbent contractor also possesses operational knowledge of system configuration, integration dependencies, and sustainment workflows that have been developed over years of system deployment and operational support. While this knowledge will be transferred through required documentation and transition support activities during the bridge period, replicating this understanding without incumbent participation would require significant time, and paying for a full overlap transition to replace the incumbent at this stage would constitute an inefficient use of Government resources. A significant portion of the knowledge transfer required to replace the incumbent would relate to operational activities associated with the current deployed environment that are already being transitioned as part of the planned cloud migration and modular acquisition strategy. Conducting a wholesale systems integrator replacement during this period would therefore require duplicative transition efforts that would not provide commensurate value to the Government. Accordingly, the Government determined that maintaining the incumbent contractor during the bridge period while progressively transitioning responsibilities to additional contractors represents the lowest-risk and most cost-effective approach.

During the bridge period, the Government will advance cloud migration with a direct relationship established with the cloud hosting provider ( ), require the incumbent contractor to produce expanded documentation describing system sustainment processes and internal interface configurations, and conduct competitive procurements for discrete capability areas within the MHS GENESIS ecosystem. As these competitions occur and additional contractors assume responsibility for defined functions, the scope of work performed by the incumbent contractor will progressively decrease. This phased transition strategy enables the Government to introduce competition while maintaining operational stability for this mission-critical healthcare system.

6. Efforts to Obtain Competition:

In preparation for introducing competition across multiple capability areas supporting Healthcare Delivery Solutions (e.g., MHS GENESIS, Digital Health, etc.), the DHMSM PMO engaged industry and conducted extensive market research looking to inform its acquisition strategy starting in April 2023 through June 2026. See detailed efforts and full list of participants in Section 10 below.

As the current MHS GENESIS contract with Leidos was concluding, and the system was fully deployed, the DHMSM PMO updated its Acquisition Strategy to account for MHS GENESIS' transition toward the continuous support phase in accordance with the DODI 5000.75 pathway for Defense Business Systems and to evaluate opportunities to introduce competition through a modular contracting approach supporting the MHS GENESIS ecosystem. To inform its updated Acquisition Strategy and its contract strategy, the DHMSM PMO sought to assess industry practices for evolving EHR systems and issued a request for information (RFI) in April 2023 to solicit such information.

The DHMSM PMO solicited further industry feedback in February 2024 through an RFI and Industry Day. The Government completed a risk assessment to transition services and provided industry an opportunity to review and provide feedback. During the Industry Day, the DHMSM PMO and contracting personnel provided an overview of the MHS GENESIS system, to include scale and complexity, and reviewed the Government risk assessment at the work breakdown structure (WBS) level. Over 100 industry partners attended the Industry Day session, and 18 responded to the DHMSM PMO's risk assessment and questions on best practices.

In October 2024, the Government issued a notice of intent to potential offerors of the proposed sole-source award to Leidos as the incumbent contractor via SAM.gov.

In November 2025, the Government provided industry with additional context regarding the scale and complexity of MHS GENESIS and the anticipated evolution toward a modular contracting structure. Industry participants were invited to provide written feedback regarding acquisition strategy considerations, transition risks, systems integration approaches, and lessons learned from comparable large-scale healthcare IT programs.

Industry Day was held on November 5, 2025, which resulted in information added to the market research result that developed the current contracting strategy.

Twenty-nine companies submitted written responses following the event. The Government reviewed these responses and incorporated industry insights into its ongoing assessment of transition risks, acquisition strategy considerations, and opportunities to introduce competition into future contract structures.

In December 2025 to further inform its acquisition strategy and support planning for the MHS GENESIS recompete, the Government issued a Request for Information (RFI) to industry via SAM.gov.

On March 31, 2026, an additional Industry Day was held to share the current contracting strategy reflected in this document and was attended by 49 vendors.

A final notice of intent/sources sought notice was posted to Sam.gov on June 8, 2026 and closed on June 12, 2026.

All Feedback received from industry helped the Government assess the risks associated with transitioning integration and sustainment responsibilities, evaluate the best commercial practices for managing large- ased transition strategy for introducing competition across discrete capability areas that is reflected in this document.

The Government also reviewed a market research compendium and supporting analyses developed by independent advisors that synthesized publicly available information, private-sector best practices, and observed industry trends relevant to large-scale healthcare IT environments.

interest in supporting portions of the MHS GENESIS ecosystem, transitioning the entire systems integrator role at once would introduce significant operational and patient safety risks. As a result, the Government determined that a phased transition strategy would involve introducing competition across discrete capability areas and entering into direct solution provider relationships while maintaining continuity of operations for the core system integration role during the bridge period, best aligns with indu requirements.

7. Actions to Increase Competition/Remove or Overcome any Barriers to Competition:

GENESIS, DHA is transitioning from a single Lead Systems Integrator construct toward a modular contracting model aligned with commercial best practices for large-scale digital platforms. Under this model, multiple contractors will support discrete capability areas within the MHS GENESIS ecosystem, including technical integration, product management, human-centered design, and end-user support. Excluding the cost of the software licenses, which is relatively constant regardless of who performs the work, the original scope of work has been reduced by approximately 25% as a result of the full deployment of MHS GENESIS and descoping the remaining portion of the incumbent's contract. This reduction reflects the multiple vendors supporting the modular contracting structure.

The Government is conducting market research and developing acquisition strategies for multiple procurements aligned to the modular contracting model. These procurements will introduce competition across distinct functional areas supporting MHS GENESIS.

As discussed above, the Government structured the bridge contract to maintain operational continuity while transitioning to a modular acquisition approach. During the bridge period, the Government will progressively transfer responsibilities from the incumbent contractor to additional contractors and direct solution providers through competitive procurements, with the contractors.

Additionally, the follow-on contract expands transition requirements by requiring the incumbent contractor to produce and organize documentation necessary to support the transition of responsibilities to additional vendors.

During the bridge period, the incumbent contractor will be required to support the transition to the modular contracting structure through activities including documentation of system architecture, knowledge transfer to newly awarded contractors, and technical collaboration to ensure continuity of operations as responsibilities are transferred. As additional contractors are onboarded through competitively awarded contracts, the scope of work performed under this contract is expected to progressively decrease as responsibilities transition to those vendors, supported by documentation and knowledge transfer activities delivered by the incumbent contractor.

If the Government identifies any additional new capabilities or solutions (major enhancements) necessary to meet the needs of the functional community, the DHMSM PMO will develop a contract strategy for the new effort. Similarly, if MHS GENESIS or any complementary EHR COTS products require future deployment to federal partners or other sites, the DHMSM PMO will develop a contract strategy for the new effort. This process will ensure that the DHMSM PMO thoroughly evaluates major enhancements and can consider how to introduce elements of competition.

The Government will continue to engage industry and conduct market research. The contract strategy will be tailored to consider the relative success of EHR solutions in the commercial marketplace as well as consider the Government's requirements surrounding an interoperable Federal EHR. The Government will determine whether other segments of work should be competed separately from those services that are part of this follow-on contract.

8. Market Research:

The DHMSM PMO conducted market research from April 2023 through June 2026 using multiple factors and methods to glean the following: what is the technical state of the art, industry interest in bidding on a contract, industry best practices on EHR systems in the sustainment phase, and how commercial sourcing happens in the sustainment phase. The DHMSM PMO obtained information through the following means:

These data sources enabled the DHMSM PMO to understand the state of MHS GENESIS as compared to other EHR users and how best to align MHS GENESIS with industry-leading EHR systems and best practices. Additional market research results informed the acquisition strategy and competition strategy with respect to cloud migration and EHR system best practices, opportunities to compete, and transition risks for required services. Specifically, the market research informed the Government's assessment that it needed to improve its documentation prior to introducing competition for portions of the MHS GENESIS sustainment and integration responsibilities, and it served as the basis for the Government to identify discrete capability areas as opportunities to introduce competition within a modular contracting structure. The market research also helped the Government evaluate transition risks associated with moving from a single systems integrator model toward a modular contracting approach while maintaining continuity of operations for this mission-critical healthcare system.

9. Other Facts:

a. Procurement History:

(1) Is this a new requirement? No

(2) If 9.a.(1) is No, was the action just prior to this one competed? Yes, DHMSM PMO awarded a 10-year IDIQ contract (Contract N00039-15-D-0044) to Leidos, Inc.

on July 29, 2015, after a full and open competition.

(3) If 9.a.(2) is Yes, what has changed where this action cannot be competed? This bridge contract is required solely to execute the newly approved modular acquisition strategy. To avoid service gaps during this transition, the incumbent must maintain MHS GENESIS operations while the Government establishes a competitive environment.

b. Additional Information: An additional key consideration is DHMSM PMO's stakeholder relationships. DHMSM PMO's federal partners, including NOAA, US MEPCOM, the USCG, and the NSA, would experience negative cost and schedule impacts if the incumbent contractor were replaced without an orderly transition during the bridge period.

10. Interested Sources:

As part of an effort to conduct industry outreach and catalog best practices, the DHMSM PMO released an RFI on SAM.gov in April 2023 to solicit interest. Fourteen vendors responded:

As part of the initial outreach to industry, the Government requested each respondent address:

The DHMSM PMO reviewed all of the small business responses and noted:

The responses from other than small businesses, , are described in more detail below. Unlike the other businesses that answered the questions posed, only focused on how its platform could support the EHR.

optimizing a COTS system in a large-scale DOW enterprise?":

Major Automated Information Systems in the Defense Department?":

construct of a multi-billion dollar requirements like MHS GENESIS, in whole or in part. At a minimum, demonstrate your management and technical capabilities for attracting, recruiting, and retaining top-quality employees with the technical skills, expertise, and experience needed to meet such an effort. Please share your technical capability as well as the supporting material that demonstrates a full understanding

All respondents had a similar framework for attracting, recruiting, and retaining talent. Besides retaining qualified incumbent personnel, leveraging recruiting tools and databases, professional networking, internal recruiting, and social media were the most common forms of recruiting talent. Lastly, competitive compensation packages are used to retain personnel.

Although the April 2023 RFI did not provide details on the size and complexity of the MHS GENESIS solution, information about the size and scope of the effort is publicly available and none of the respondents asked for clarification.

The DHMSM PMO released a February 2024 RFI and held an Industry Day to review the size and complexity of the MHS GENESIS solution and allow industry to ask clarifying questions to better respond to the Government's request. The February 2024 RFI gathered industry responses regarding transition risks, sharing the Government's WBS risk analysis and seeking industry's independent assessment of the Government's WBS risk analysis. There were only a few overlapping companies between the respondents to the April 2023 and the February 2024 requests. Eighteen vendors responded to the Government's WBS risk analysis with their own analysis:

None of the respondents, excluding the incumbent, have experience as a prime contractor for a complex EHR solution of the scale and complexity of MHS GENESIS. Out of fifteen

The Notice of Intent (NOI) further shared that the Government's assessment is that responses must elaborate on each of the four enumerated paragraphs above. If a company disagrees with that assessment, please respond by explaining how the Government may otherwise meet the requirements listed in this notice. Four vendors responded to the Government's NOI:

Three of the four respondents answered with interest in collaborating with the Government to provide valuable services but did not respond to the questions.

Only one respondent addressed the Government's questions in the NOI. The Government

November 2023 award of the EHR modernization contract to implement the , known as . The respondent attempts to make the case that it can perform the services sought as outlined in this J&A and, therefore, the Government should pursue full and open competition for the follow-on into account that will be 18 months into its 36-month transition to the cloud by the end of the current contract and fails to include information on what it would do to prevent unacceptable delays should it be awarded the follow-on contract from months 19 to 36. Furthermore, the respondent neglects to address how it would assume the role of lead systems integrator (LSI) to manage, operate, and integrate the on-premises MHS GENESIS solution during the remaining 18 months of the transition to the cloud without a planned transition period with the incumbent, to prevent degradation in services of a fully functioning EHR system. Even assuming hypothetically that the respondent, as LSI, could assist with the transition to the cloud without unacceptable delays during the last 18 months, the only way to keep the on-premises MHS GENESIS solution up and running during those 18 months without degradation of services would be for the Government to pay Leidos to do it. While several vendors demonstrated currently maintains critical operational knowledge of the deployed MHS GENESIS environment, including systems integrations, internal configurations, and operational processes necessary to sustain a live enterprise EHR supporting the MHS. Immediate replacement of the incumbent contractor without a structured transition period would introduce unacceptable operational risk to healthcare delivery due to the complexity of the system and the extensive integration across the DHA application ecosystem.

After providing notice via SAM.gov to industry on October 29, 2025, the Government held an Industry Day for all interested companies on November 5, 2025, with companies participating in person. Attendance was capped at 150 participants, with a maximum of three (3) representatives per company. A recording of the Industry Day presentation was subsequently made available to industry via SAM.gov. During the Industry Day, the Government requested written feedback from industry on a defined set of input questions focused on acquisition strategy, risk areas, integration considerations, and lessons learned from comparable large-scale healthcare IT programs. The following questions were documented:

Participants were asked to submit questions through the Bidscale platform and written responses via email following the event; 27 companies submitted responses. Insights strategy risks and considerations.

Industry day feedback strongly indicates a market consensus to shift away from a traditional single-prime model toward modular governance and domain-based contracting. The most prominent theme, emphasized by 17 vendors, is the adoption of a modular integration construct that distinctly separates system stability (operations and maintenance) from new capabilities and innovation. To ensure system-wide interoperability, vendors prioritize replacing point-to-point connections with an API-first enterprise data fabric. Focus also heavily centers on optimizing Revenue Cycle Management (RCM) and pharmacy workflows (9 vendors) before executing broader replacements. To support this modularity and ensure accountability, vendors advocate for outcome-based compensation models such as a Firm Fixed Price (FFP) core with performance incentive pools or shared savings tied to independently tracked Key Performance Indicators (KPIs). For Service Level Agreements (SLAs), the market heavily prioritizes System Availability & Reliability (7 vendors), Revenue Cycle & Financial metrics (6 vendors), and User Experience & Adoption (6 vendors). Furthermore, vendors recommend that the government directly hold OEM licensing and cloud hosting agreements (4 vendors) to increase transparency and minimize mark-ups, while instituting cross-vendor oversight mechanisms like Service Integration and Management (SIAM) or independent validation.

In December 2025, the Government issued an additional RFI via SAM.gov to obtain updated industry perspectives regarding the sustainment and evolution of large-scale EHR systems operating in complex enterprise environments. The RFI requested industry input on system integration models, vendor management structures, hosting approaches, and strategies for sustaining and enhancing large-scale digital healthcare platforms following full deployment.

As part of this RFI, the Government also introduced a preliminary concept for a modular contract structure intended to separate certain capability areas, such as system integration, product management, human-centered design, and selected support services, into distinct contracting components. Industry was asked to provide feedback on the feasibility of this approach, potential benefits and risks associated with modularization, and lessons learned from comparable enterprise healthcare IT programs employing multi-vendor delivery models.

The RFI further sought industry perspectives on hosting and cloud migration considerations, governance structures used to coordinate multiple vendors supporting a single enterprise EHR ecosystem, and best practices for balancing operational stability with the ability to introduce innovation and competition over time. Respondents were encouraged to provide examples of comparable healthcare IT programs and lessons learned from transitioning from implementation to sustainment phases.

Industry responses highlighted the operational complexity and scale associated with sustaining large enterprise EHR systems and emphasized the importance of maintaining continuity of system integration, configuration management, and operational knowledge during the sustainment phase. Respondents also noted that transitions of systems integrators in fully deployed enterprise EHR environments can introduce significant operational risk if undertaken without sufficient documentation, transition planning, and continuity of institutional knowledge.

transition risks, acquisition strategy considerations, and potential opportunities to introduce competition in discrete capability areas while maintaining the stability and availability of the MHS GENESIS system.

After providing notice via SAM.gov to industry on March 13, 2026, the Government held an Industry Day for all interested companies on March 31, 2026, with companies participating in person. Attendance was capped at 300 participants, with a maximum of three (3) representatives per company; 70 companies attended. Following Industry Day, the Government released the following materials:

Contract Strategy: The presentation provided interested companies with context on HCDS EHR follow on contract strategy.

Questions & Answers (Q&A): Questions/ answers received during industry day that the Government was unable to answer during the presentation.

Industry Day demonstrated strong industry interest and support for the proposed contract strategy. The event saw high attendance from both large and small businesses. Feedback during the Q&A sessions was highly positive, indicating that the market clearly understands the proposed contract structure, acquisition timeline, and procurement method. Overall, the strong engagement during the event confirms that our contracting strategy aligns with standard market practices and will support a highly competitive bidding process.

Lastly, in June 2026, the Government issued its final notice of intent via SAM.gov to notify potential offerors of the proposed sole-source award to Leidos as the incumbent contractor.

Interested parties were given 5 calendar days to address the following:

The Notice of Intent (NOI) further shared that the Government's assessment is that responses must elaborate on each of the three enumerated paragraphs above. If a company disagrees with that assessment, please respond by explaining how the Government may otherwise meet the requirements listed in this notice. Two vendors responded to the Government's notice of intent:

answered with interest in collaborating with the Government to provide valuable services with only responding to the questions. responses to the questions offer more of an assistive role in the acquisition. Additionally, upon further review of the company, Accordingly, the Government requires continued support from the incumbent contractor during the bridge period to maintain system stability and enable the orderly transition of responsibilities to additional contractors supporting discrete capability areas within the MHS GENESIS ecosystem.

13. Contracting Officer Determination of Fair and Reasonable Pricing and Certification of Accuracy and Completion.

Fair and Reasonable Cost Determination: I hereby determine the anticipated cost to the Government for this contract action will be fair and reasonable.

Basis for Determination: The anticipated cost to the Government for this contract action is expected to be fair and reasonable. To ensure the final negotiated prices are fair and reasonable, the Contracting Officer will utilize a combination of the following price analysis techniques:

Independent Government Cost Estimate (IGCE): Evaluate against a detailed IGCE developed by technical experts familiar with the MHS GENESIS platform, current market conditions, and required sustainment levels.

Historical Price Comparison: Compared to historical prices paid for the exact same proprietary software, licenses, and services previously acquired under the legacy solution provider integrator contract, adjusting for the removal of the integrator's pass-through fees.

Commercial Market Pricing: Because these capabilities are fundamentally commercial healthcare IT solutions, the Government will compare proposed pricing against published commercial catalogs, competitive published price lists, and market rates for similar enterprise-scale deployments.

Data other than certified cost or pricing data: If necessary, the Contracting Officer will require the vendors to submit data other than certified cost or pricing data (such as unredacted commercial sales practices or direct labor rate breakdowns) to thoroughly evaluate the reasonableness of proposed labor categories and software licensing structures.

Review and Approval

I have reviewed this justification and find it adequate to support other than full and open competition.

Approval