JA_CPS.pdf

Control Number VA-21-00021135

JUSTIFICATION

FOR AN EXCEPTION TO FAIR OPPORTUNITY

1. Contracting Activity: Department of Veterans Affairs (VA)

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

2. Description of Action:

The proposed action is for the issuance of a firm-fixed-price Task Order under Transformation Twenty-one Total Technology Next Generation (T4NG), for a brand name International Business Machine (IBM) Financial Crimes Insight (FCI) software utilized as the workflow tool for VA Revenue users within the existing Claims Processing System. The brand name software being procured only applies to a portion of the total procurement. The overall procurement is to obtain services to support operations, maintenance and enhancement of the existing Claims Processing System.

3. Description of the Supplies or Services:

The proposed action is for IBM FCI software, product support, security and product updates, as an enterprise-level licensed product, utilized as the workflow tool in the Community Care Claims Processing System. In June 2017, a competitive task order was awarded for the Community Care Claims Processing System. The IBM FCI software was proposed and included as part of the Claims Processing System and is now required as part of the recompete. The IBM FCI software within the Claims Processing System identifies all invoices paid by Veterans Health Administration (VHA) for Veterans or Veteran Beneficiaries who have billable other health insurance and/or are VA 1st party copayment required. The Revenue Operations team utilizes the data included on the Electronic Data Interchange 837 Coordination of Benefits transactions submitted to VA by the claims processing vendor for revenue processes. This justification for the brand name IBM FCI software only applies to a portion of the total procurement. The total estimated price of the effort is $; however, the estimated price for the brand name portion only is $. The period of performance of the overall action includes a 12 month Base, with four 12-month Option Periods and four Optional Tasks.

One of the optional tasks is for the IBM FCI software renewal during the option periods.

Accordingly, the approval level for this justification is based on the brand name portion of the requirement only.

4. Statutory Authority:

Pursuant to Federal Acquisition Regulation (FAR) 16.505(a)(4), the following brand name requirement is being justified and approved as an exception to fair opportunity under the statutory authority of Section 41 U.S.C. 4106(c)(2) as implemented by FAR 16.505(b)(2)(i)(B), entitled “Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services ordered are unique or highly specialized”.

IBM Brand Name FCI Software Control Number VA-21-00021135

5. Rationale Supporting Use of Authority Cited Above:

The Claims Processing System was developed and configured using the proprietary IBM FCI software. This overall procurement is to obtain services to support operations, maintenance and enhancement of the existing Claims Processing System, inclusive of the IBM FCI software. The Claims Processing System was developed for VA and is dependent upon the IBM FCI software to deliver capabilities. The Claims Processing System is comprised of a government-off-the-shelf (GOTS) and commercial-off-the-shelf (COTS) solution, of which the IBM FCI is the only brand name software required to maintain the system in order to ensure maintenance and enhancement support can continue. This product reviews Community Care Network (CCN) claims for payment using customized coding following VA business requirements. The IBM FCI software approves claims for payment and displays all of the claims data and decisions in reports and in the graphical user interface provided by IBM. The IBM FCI software is the backbone of the Claims Processing System which cannot function without use of this brand name product. The IBM FCI software currently provided by the incumbent contractor for the Claims Processing System, including enterprise license and support, is only available through IBM or an authorized IBM reseller. No other brand name software available in the market is interoperable or compatible with the existing Claims Processing System without a complete redesign and reengineering effort. Specifically, use of any other brand name software other than brand name IBM FCI in the Claims Processing System would require a complete redesign of the existing Claims Processing System to incorporate a replacement software and reconnect all of the custom developed code and bi-directional interfaces transmitting data for the system. This would entail re-developing thousands of lines of code, phased transition and extensive training to both VA and CCN resources. Based on previous configuration, design and testing efforts, this process would lead to estimated duplicative costs of approximately $22 million and also require a minimum of two years to redesign and implement the new system. As a result, procuring a new software solution at this time through competitive methods would result in substantial duplication of time and cost to the Government that is not expected to be recovered in competition and would also result in unacceptable delays in providing critical services to Veterans. Any situation that leads to the loss of IBM FCI as the brand name product is untenable for VA because reliance upon this product enabled completion of the VA Mission Act of 2019 along with the operation and monitoring of the CCN. Without continued use of the IBM FCI software, VA could not continue to identify all invoices paid by VHA for Veterans or Veteran Beneficiaries who have billable other health insurance and/or are VA 1st party copayment required. More specifically, the review and processing of more than $ from 12 million invoices to date would cease if the Claims Processing System became inoperable.

6. Efforts to Obtain Competition:

Market research was conducted, details of which are in section 8 of this justification.

This effort did not yield any additional sources that can meet the Government's requirements. However, the undersigned VA technical representative determined that limited competition is viable among authorized resellers for brand name IBM

IBM Brand Name FCI Software Control Number VA-21-00021135 licenses, as well as software maintenance and support. In accordance with FAR 16.505(a)(4)(iii)(A)(2), this justification will be provided with the solicitation to all interested T4NG Contract holders. Furthermore, in accordance with FAR 5.301, 16.505(b)(2)(ii)(D), and 16.505(a)(4)(iii), the award notice for this action will be synopsized on the Federal Business Opportunities website and this justification will be made publicly available within 14 days of award.

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:

Market research was conducted in October 2020 through April 2021. A request for information (RFI) was posted on the T4NG portal on February 22, 2021, including a draft Performance Work Statement (PWS), technical specifications, and specific questions related to vendor capabilities maintaining systems with a similar architecture.

The draft PWS and attachments posted with the RFI stated the specific software needs and described the current solution’s architecture, including the IBM FCI requirement.

The RFI closed on March 1, 2021 resulting in 10 responses, consisting of five Service- Disabled Veteran-Owned Small Businesses (SDVOSBs) and five large businesses.

Upon review of the RFI responses, technical experts deemed two of the SDVOSBs capable of meeting the Government’s requirements and confirmed they also appeared capable of providing the IBM brand name software required. The contract specialist reached out to the two capable SDVOSBs and they both confirmed that they can deliver IBM FCI as part of their proposed solution support. Additionally, Government subject matter experts reviewed alternate brands from companies such as Thrive’s Revenue Cycle Management Technology and Accenture’s Financial Crime Analytics Utility.

However, due to the interoperability requirements of the Claims Processing System and proprietary nature of the IBM FCI software, there is no other compatible software to meet the requirements or satisfy the Government’s needs. Based on the above, the Government’s technical experts have determined that only IBM FCI brand name software can meet all of the Government’s needs and maintain the operability of the Claims Processing System.

9. Other Facts: None.