JA_Alpha II redacted.pdf

Control Number VA-21-00005705

JUSTIFICATION FOR A SOLE SOURCE AWARD

FOR CERTAIN COMMERCIAL ITEMS

1. Contracting Activity: Department of Veterans Affairs

Office of Procurement, Acquisition, and Logistics Technology Acquisition Center 23 Christopher Way Eatontown, NJ 07724

2. Description of Action: The proposed sole source action is for a firm-fixed price (FFP) Contract for pricing, auditing and customer support for historical Veteran Medical Claims that were processed through the Fee Basis Claims Management System (FBCS). The proposed source is Alpha II, LLC, 2074 Summit Lake Drive, Tallahassee, Florida, 32317.

3. Description of Supplies or Services: As part of an integrated strategy to provide Veterans with timely access to quality healthcare, Department of Veterans Affairs (VA), Veteran's Health Administration (VHA) healthcare facilities are authorized to pay for healthcare services acquired from non-VA healthcare providers. VA manages the authorization, claims processing and reimbursement for services acquired from non-VA health care providers through the Purchased Care Program. VA used the Fee Base Claim System (FBCS) to manage and process Fee claims in an electronic environment which improved the ability to keep track of claims in-process and enabled identification of duplicate and non-compliant claims. However, VA retired the FBCS software and other systems are used to authorize and pay claims. Certain types of claims will still need to be priced that cannot be completed in the Electronic Claims Adjudication Management System (eCAMS). The eCAMS cannot process historical claims because it does not have the original claims (frequency code 7s) information. VA requires a separate system that that can price claims with a frequency code 7. Additionally, there will be mandatory periodic audits on claims processing for historical claims, which will require a review of the prices paid to non-VA health care providers compared to Centers for Medicare and Medicaid Services (CMS) allowable rates on the Government’s fee schedule for the applicable year, in which the claim was adjudicated (the scope of these audits may review up to seven years in the past). VA requires access to Alpha II’s proprietary web-based database to price claims and support periodic audits for historical FBCS claims. The requirement entails upload of historical FBCS claims to the Alpha II website and a price verification is returned for the submitted claims. These historical FBCS claims are expected to be between 1,000 and 1,500 claims per week and will decrease over time as the claims age. These claims use a Frequency code of either 7 (corrected or replacement claim) or 8 (voided or cancelled claim) which requires the original claim / price information to be processed. The Contractor shall provide a secure means of accepting 837 Health Care Claims (Professional, Institutional, & Dental) (aka EDI X12 Health Care Claim) files to be priced. The contractor will need access to the original claim price information to be able to price these claims. The Alpha II web-based database and the FBCS archive are the primary sources for original claim information.

These claims will need to be priced in accordance with all associated CMS fee schedules used by the VA, which will be provided by the Alpha II Pricer solution, which

Claims Pricing and Audit Support Control Number VA-21-00005705 is an integrated payment calculator, available exclusively from Alpha II. VA also requires access to Alpha II’s ClaimStaker proprietary tool to verify claim data and allow for corrections prior to filing. The period of performance will consist of a 12-month base period with two 6-month option periods The total estimated value of the proposed action is $328,251.00 (inclusive of options).

4. Statutory Authority The statutory authority permitting other than full and open competition is 41 U.S.C. 1903 as implemented by the Federal Acquisition Regulation (FAR) 13.501, entitled “Special Documentation Requirements”.

5. Rationale Supporting Use of Authority Cited Above: The Alpha II Pricer and ClaimStaker tools are only available from Alpha II. These tools use proprietary logic of claims adjudication edits and provider-specific data used for CMS pricing in support of the FBCS program and were developed over several years. Alpha II has the historical data for the claims pricing that will ensure that they will be able to continue pricing claims received that will require access to the original claims pricing information.

Additionally, by already having the historical pricing information, this will allow Alpha II the ability to continue providing both customer support as well as VA Audit support with no breaks in service. Alpha II has all the fee schedules already loaded that the VA requires for pricing claims, some of which were created as customized development since they didn’t previously exist, but were necessary for processing claims in FBCS.

Only Alpha II is capable of meeting VA’s requirements for managing, processing and auditing claims for Veterans’ care provided by non-VA healthcare providers in the FBCS system.

6. Efforts to Obtain Competition: Market research was conducted, details of which are in the market research section of this document. This effort did not yield any additional sources that can meet the Government’s requirements. Additionally, the proposed action will be synopsized on the Contracting Opportunities Page in accordance with FAR 5.201. Any proposals that are received shall be evaluated.

7. Actions to Increase Competition: The Government will continue to conduct market research to ascertain if there are changes in the marketplace that would enable future actions to be competed.

8. Market Research: The Technology Acquisition Center (TAC) issued a Request for

Information (RFI) in November 2020 via the Contracting Opportunities page to ascertain if there were any other sources that could meet the Government’s requirements. A follow up RFI was issued in April 2022. Responses were received from the following seven companies during the initial RFI: Verve, LLC (Service-Disabled Veteran Owned

Small Business (SDVOSB) and Woman Owned Small Business (WOSB)); SurfBigData

LLC (Small Business (SB)); Alpha II (SB); Broadway Ventures, LLC (SDVOSB, 8a, Historically Underutilized Business Zone (HUBZone) SB); Global Accounting LLC

(SDVOSB, WOSB, Minority Owned SB, HUBZone SB); Monbo Group International (8a

SB); and BMT Consulting, Inc. (SDVOSB). Responses from Signature Performance

(Large Business) and Alpha II, reaffirming Alpha II’s original response, were received during the second RFI. Verve, LLC has technical capability related to eCAMS claims, not FBCS. SurfBigData LLC meets some, but not all, of VA’s technical requirements, specifically, it does not address an approach to obtaining historical information needed to price and audit claims. Broadway Ventures, LLC, Monbo Group International and

BMT Consulting, Inc. provided brief marketing notes about its general experience, but did not specifically respond to the RFI questions or VA’s technical requirements set forth in the product description. Global Accounting LLC does not have an existing solution that can meet VA’s technical requirements. Signature Performance was found to be a whole system replacement with too long a set up time without the ability to access frequency code 7 claims. Alpha II provided the only response to the RFI that was deemed technically capable of meeting VA’s requirements. Based on this market research the Government’s technical experts have determined that Alpha II is the only source that can meet the Government’s technical requirements. Additionally, in March of 2022, a search of the Vendor Information Pages site was conducted using NAICS code 541519, Other Computer Related Services, and keyword “claim” yielded 17 matches. Despite the number of matches, the requirement discussed herein is more specialized than a simple NAICS code search; therefore, more specific market research was necessary. The result of this market research, discussed above, was the primary market research considered for this procurement.

9. Other Facts: As this requirement for access to Alpha II Pricer is an interim solution until such time that the volume of claims needing to be repriced and the need for the audit support is completed, VA cannot invest in duplicative efforts to develop an alternate source. The volume of claims drops exponentially over time as the age of the original claim increases. The same is true for audit requirements because, since 2019, most VA’s non-VA healthcare claims have been priced in other systems outside FBCS.

Eventually, the requirement will be unnecessary as the number of FBCS historical claims diminishes to zero.

10. Technical and Requirements Certification: I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Richard A. Holmes Date: ________________________________

FBCS Program Manager Signature: ____________________________

11. Fair and Reasonable Cost Determination: I hereby determine that the anticipated price to the Government for this contract action will be fair and reasonable based on price analysis techniques set forth in FAR 15.404-1 including comparison of proposed prices with the Independent Cost Estimate and comparison of the proposed prices to historical prices paid, whether by the Government or other than the Government, for the same or similar items.

Debra Clayton Date: ________________________________

Procuring Contracting Officer Signature: ____________________________

12. Procuring Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief. As this contract action exceeds the simplified acquisition threshold, but does not exceed $750,000, the certification required by FAR 13.501(a)(2)(i) serves as approval.

Debra Clayton Date: ________________________________

Procuring Contracting Officer Signature: ____________________________