JA EDI Bridge Final Redacted.pdf

Justification and Approval for Other Than Full and Open Competition

1. Contracting Activity: Department of Veterans Affairs Office of Procurement Acquisition and Logistics

Strategic Acquisition Center (SAC) 10300 Spotsylvania Ave, STE 400 Fredericksburg, VA 22408

2. Nature and/or Description of the Action Being Processed:

This Justification and Approval (J&A) for Other Than Full and Open Competition is executed by the Strategic Acquisition Center (SAC), on behalf of the Department of Veterans Affairs (VA). The activity proposes to negotiate a non-competitive award (sole source) “Bridge Contract” with Change Healthcare Operations, LLC for the procurement of Clearing House Services to Support Health Care Electronic Data Interchange (EDI). The anticipated award number for this action is 36C10G-21-D-0019. In accordance with Federal Acquisition Regulation, Subpart 6.302-2 Unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided. The award period is noted below:

BASE PERIOD: 04/01/2021 – 09/29/2021 (six months)

The new award requirement is combination of EDI services referenced in this justification and the Clearing House Services to Support Paper-Based Health Claims and Associated Medical Documentation (P2E) supported in a similar contract. The Strategic Acquisition Center conducted a competitive procurement via Federal Business Opportunities (FBO) in June 2020. The procurement was awarded in December 2020 and subsequently protested. The Integrated Product Team is currently taking corrective action against the protest. The delay in awarding the competitive procurement has created unforeseen circumstances in continued service. EDIP2E services are a critical function of the entire VA business model in which services cannot be interrupted, necessitating this bridge contract and the possible six-month period of performance.

The current contract 36C10G-21-D-0002 is a firm-fixed price/Indefinite Delivery Requirements awarded contract with a period of performance of a three- month base period and a three- month option period which expires on March 31, 2021. The services have been awarded sole source in order to prepare for a new requirement vehicle to support the Department of Veterans Affairs.

The contractor provides Healthcare Clearinghouse (HCCH) Electronic Data Interchange (EDI) services to the Veteran’s Health Administration (VHA) Office of Community Care (OCC). The HCCH serves as a third-party administrator between the VHA OCC and over 1 million medical and dental providers nationwide, including Puerto Rico, Guam, The Northern Mariana Islands, American Samoa, and US Virgin Islands. Over a million EDI transactions have been processed since contract 36C10G-20-D-0002 was initiated in October of FY21. The current contract was a sole source contract awarded to the incumbent on October 1, 2020, with one option period. The single option period has been exercised and ends on March 31, 2021. Change Healthcare Operations, LLC is solely responsible for the EDI processes and is therefore, the contractor to only partial requirements of the newly contemplated competitive requirement that will combine EDI and Paper to Electronic (P2E). Change Healthcare Operations, LLC is currently providing EDI services which has vetted through Agency level IT, HIPAA, and security process.

The historical overview of the subject requirement is provided below:

Contract Number Period of Performance Authority VA741-14-D-0039 Base Period: 09/01/2014 – 08/31/2015

Option Period 1: 09/01/2015 – 08/31/2016 Option Period 2: 09/01/2016 – 08/31/2017 Option Period 3: 09/01/2017 – 08/31/2018 Option Period 4 09/01/2018 - 08/31/2019 6 Month Extension: 09/01/2019 – 02/29/2020

36C10G-20-D-0011 Base Period: 03/01/2020 - 05/31/2020 (three months) Option Period 1: 06/01/2020 – 07/31/2020 (two months) Option Period 2: 08/01/2020 – 08/31/2020 (one month) Option Period 3: 09/01/2020 – 09/30/2020 (one month)

6.302-1

36C10G-21-D-0002 Base Period: 10/01/2020 – 12/31/2020 (Three Months) Option Period 1: 01/01/2021 – 03/31/2021 (Three Months)

6.302-2

36C10G-21-D-0019 (Pending Approval of J&A)

Base Period: 04/01/21 – 09/29/2021 (Six Months) 6.302-2

3. Description of Supplies/Services Required to Meet the Agency’s Needs (including the estimated value:

VHA OCC requires a HCCH Contractor able to complete EDI transactions throughout the fifty United States, District of Columbia, Puerto Rico, Guam, the U.S. Virgin Islands, the Northern Marinara Islands, the American Samoa, and the Minor Outlying Islands, that is able to provide EDI services to Non-VA Medical Care Program (NNPO-legacy name VA Fee Basis), Non-VA Medical Care Dialysis National Contracts (DNC), Patient- Centered Community Care (PCCC), Indian Health Service and Tribal Health Programs (HIS/THP), Compensation and Pension (C&P) Examinations National Contracts Community Care Network (CCN) CHOICE, VA Maintaining Systems and Strengthening Integrated Outside Networks Act (MISSION) Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA) (38 CFR, Section 17.270 to 17.278) to include the Caregiver Program, Spina Bifida (SB), and Children of Women Vietnam Veterans (CWVV) (38 CFR, Section

17.900 to 17.905), Camp Lejeune Family Member Program (CLFMP) and any future VHA OCC program beneficiaries. The estimated award value for this acquisition is approximately $7,345,516.80 spread over a six-month period. If the replacement awards are done sooner than anticipated, the $7,345,516.80 estimated valued will decrease accordingly based upon the spend rates in the respective period of performance.

4. An identification of statutory authority permitting other than full and open competition:

The statutory authority permitting other than full and open competition is 41 U.S.C.3304(a)(2) as implemented by the Federal Acquisition Regulation (FAR) Subpart 6.302-2 entitled, “Unusual and Compelling Urgency.”

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

The incumbent has successfully processed over 38 million EDI transactions since March 1, 2020 for the NNPO, DNC, PCCC, IHS/THP C&P Exams, CCN, Choice, MISSION, CHAMPVA, SB, CWVV, and CLMP. All plan edits including subscriber ID, NPI, Validation, Subscriber Birthdate etc. are already established. The VHA OCC system receives EDI transactions from the vendor in batch and real time and processes them accordingly. The incumbent offers an exceptional resource of services and capabilities needed to complete the requirements of this acquisition. Accordingly, the award to Change Health Care Holdings, Inc. allows for the continuity of providing the services required without VHA OCC experiencing unacceptable delays in fulfilling its requirements and avoids any lapse in services. The Clearinghouse services provided by Change Health Care Holdings; Inc. has been deemed by the Mission Act of 2018 to be an essential service to the Veterans (i.e. the requirement to promptly pay providers). EDI provides the

In the medical billing process, accepts both paper and electronic submissions for health claims and for their supporting documentation (i.e. attachments). Submissions are received from community healthcare providers in support of both Veteran and Veteran Family Member health benefit programs for processing and payment.

The electronic submissions are healthcare electronic data interchanges (EDI) compliant with and governed by the Department of Health and Human Services (HHS) through the Health Insurance Portability and Accountability Act (HIPAA). VA currently uses the X12 5010 standard, which will be updated per HHS timelines. This contract serves as a clearinghouse for community providers to submit claims for payment to the VA. If these services do not continue, VA will have no way to receive these claims for payment and will be unable to pay providers. If providers are not paid, services to Veterans will discontinue. This is a direct impact to Veterans’ care.

6. Description of efforts made to ensure that offers are solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by FAR Subpart 5.2 and, if not, which exception under 5.202 applies:

In accordance with FAR Subpart 6.302-2 entitled, “Unusual and Compelling Urgency” an attempt to seek offers from as many sources has been accomplished for the follow-on requirement. A notice shall be posted on Beta.SAM.Gov, formerly FBO in accordance with FAR Part 5.

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and

Reasonable:

No award shall be made until the Contracting Officer determines the cost to the Government to be fair and reasonable. This determination will be based on a comparison of current contract pricing, past proposal submissions (if available), other information made available, and an Independent Government Cost Estimate, etc. The Government’s intention is to award solely on the basis of achieving pricing, which is the same, or less, than the current award’s pricing.

8. Description of the Market Research Conducted and the Results, or a Statement of the