QA CAS Applicability Specific Clauses (May 15 2020).pdf

RFP# HT940220R0002 Answers to Interested Parties 5/15/2020

DHA has received several questions regards CAS and specific clauses included in the DRAFT RFP# HT940220R0002 and wanted to provide all interested offerors the following feedback:

ANSWERS TO INTERSTED PARTIES - Cost Accounting Standards (CAS), provisions and clauses

a. The TPharm5 contract (resulting from RFP# HT9402-20-R-0002) will be a hybrid contract (not FFP), with a total expected price well in excess of $500 Mil. Since none of the exemptions listed in 48 CFR 9903.201-1 apply to this procurement, TPharm5 will be subject to full CAS coverage and the submission of Disclosure Statement(s).

b. Looking first to the solicitation and then the potential contract, we will address each clause the interested parties questioned (although not in the same order asked):

Section L DFARS 252.215-7010 Requirements for Certified Cost or Pricing Data and Other Than Certified Cost or Pricing. The Government will not ask offerors to provide certified cost and pricing data in proposals submitted in response to RFP# HT9402-20-R-0002. The Government will however, request Other Than Certified Cost or Pricing data be provided in the offeror's proposal. The Government is considering use of DFARS 252.215-7010, Alternate I (June 2019) in this solicitation, to specify the format(s) offerors shall use to provide Other Than Certified Cost or Pricing data in their proposals.

Section K Both provisions, FAR 52.230-1 Cost Accounting Standards Notices and Certification (DEVIATION 2018-O0015), and FAR 52.230-7 Proposal Disclosure - Cost Accounting Practice Changes, are required to be in any solicitation for contracts which are subject to CAS, as prescribed in FAR 30.201-3.

Section I DFARS 252.242-7005 Contract Business Systems, DFARS 252.215-7002 Estimating System Requirements, and DFARS 252.244-7001 Contractor Purchasing System Administration

DFARS 252.242-7005 Contract Business Systems is a required clause for all CAS covered contracts, as prescribed by DFARS 242.7001. This clause addresses the Contractor's responsibility to establish and maintain acceptable business systems (to include estimating and purchasing systems) as well as taking corrective actions needed to resolve any deficiencies should they be identified in these systems. This is logical since DoD will rely upon information produced by these systems to make its management decisions.

DFARS 252.215-7002 Estimating System Requirements, is a required clause for any award based on certified cost and pricing data, as prescribed by DFARS 215.408. The term "award" however, may be applied to change orders as well as to an initial contract award; and you will note that FAR 52.215-21, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data - Modifications (OCT 2010) - Alternate III is included in Section I. The TRICARE program has experienced numerous changes to service contracts that exceed the threshold for certified cost and pricing data in cost proposal(s). Additionally, under TPharm5 the Government will pay the Contractor for the cost of drugs (from accepted offers) to provision under the Market Price Pharmaceutical Program (MPPP). For either task the Government must be able to rely on the Contractor's estimating system, to provide verifiable, supportable and adequately documented cost data in a timely manner.

RFP# HT940220R0002 Answers to Interested Parties 5/15/2020

DFARS 252.244-7001 Contractor Purchasing System Administration - Basic, is also a required clause, as prescribed 244.305-71(a), as a consequence of FAR 52.244-2, Subcontracts being present in the solicitation (this clause is required by FAR 44.204(a) (1)(iii)), because future unpriced contract actions are anticipated. That said, the Government believes a distinction may exist between subcontracts for items common to the offeror's commercial book of business that will also be used in support of this contract (i.e. items needed to support general business operations or process home delivery prescriptions, etc.), and subcontracts goods and services unique to the requirements of TPharm5. The Government will add 252.244-7000 Subcontracts for Commercial Items to this solicitation.

Finally, the Government has identified two additional clauses that will be added to Section I, to improve contract administration of the TPharm5 contract: FAR 52.230-2 Cost Accounting Standards (DEVIATION 2018-O0015) and FAR 52.230-6 Administration of Cost Accounting Standards.

QUESTIONS RECEIVED FROM INTERESTED PARTIES - Cost Accounting Standards (CAS), provisions and clauses

Cost Accounting Standards (CAS) Applicability

We would like to understand the inclusion of the following clauses in the Draft TPharm5 RFP, assuming the resulting contract from the Draft TPharm5 RFP will be a hybrid contract, consisting of firm fixed priced, fixed priced incentive fee and award fee CLINS, with no cost-type CLINS:

Section I - DFARS 252.215-7002 Cost Estimating System Requirements, DFARS 252.242-7005 Contract Business Systems, DFARS 252.244-7001 Contractor Purchasing System Administration

Section K - FAR 52.230-1 Cost Accounting Standards Notices & Certifications and FAR 52.230-7 Proposal Disclosure - Cost Accounting Practice Changes

Section L - DFARS 252.215-7010 Requirements for Certified Cost or Pricing Data and Other Than Certified Cost or Pricing Data