JA_Final IBM.pdf

IBM Brand Name FCI Software

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, New Jersey 07724

2. Description of Action: This proposed action is for a firm-fixed-price delivery order issued under the National Aeronautics and Space Administration (NASA) Solutions for Enterprise-Wide Procurement (SEWP) V Governmentwide Acquisition Contract (GWAC) for 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.

3. Description of the Supplies or Services: The proposed action is for IBM FCI software, utilized as the workflow tool in the Community Care Claims Processing

System (CPS). The CPS receives invoices for payment from large, contracted vendors providing healthcare to Veterans. The existing system requires support, maintenance, customization and development. In addition, the existing system includes a brand name portion for IBM FCI software. The IBM FCI software within the CPS identifies all invoices paid by Veterans Health Administration (VHA) for Veterans or Veteran Beneficiaries who have billable other-health insurance and/or are VA first 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.

On August 2, 2021, a Transformation Twenty-One Total Technology Next Generation task order, VA118-16-D-1027/36C10B21N10270008, was awarded to SBG Technology

Solutions (SBG) using competitive procedures for operations and maintenance and enhancement of the existing CPS. This awarded task order also included a provision for licensing the aforementioned IBM FCI software, which is up for renewal. On August 17, 2021, an unsuccessful offeror filed a Government Accountability Office (GAO) protest challenging the award to SBG. The timing of the protest filing resulted in the stay of contract performance of this award pursuant to 31 U.S.C. § 3553 (d)(3)(A)(ii). A decision from GAO is not expected until November 26, 2021. As a result, the VA faces a gap in service for this critical claims processing system.

The total estimated price of this effort is $. The period of performance for this effort is limited to four months, to ensure VA will not suffer a gap in coverage for utilization of this critical software solution pending resolution of the aforementioned protest.

4. Statutory Authority: The statutory authority permitting this exception to fair opportunity is 41 U.S.C. 4106(c)(2) as implemented by Federal Acquisition Regulation (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.”

5. Rationale Supporting Use of Authority Cited Above: Based on market research, as described in section 8 of this justification, it was determined that limited competition is available for the required brand name IBM FCI software. The CPS was developed and configured using the proprietary IBM FCI software and is dependent upon the IBM FCI software to deliver critical system capabilities. The CPS is comprised of a Government-off-the-shelf and commercial-off-the-shelf solution, of which the IBM FCI is the only brand name software required to maintain the system in order to ensure that maintenance and enhancement support can continue. The IBM FCI software 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 CPS, which cannot function without use of this brand name product. The IBM FCI software, 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 CPS without a complete redesign and reengineering effort of the CPS to permit use of any other solution. Specifically, use of any other brand name software other than brand name IBM FCI in the CPS would require a complete redesign of the existing CPS to incorporate a replacement software and reconnect all of the existing, extensive, 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 $ and also require a minimum of two years to redesign and implement the new system. As a result, any effort to procure 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, as well as create significant, unacceptable delays in providing critical services to Veterans should there be a break in the CPS’ ability to function. A break in service for the IBM FCI would be catastrophic to VA and its ability to process claims through the CPS. Any situation that leads to the loss of IBM FCI as the brand name product is untenable for VA, particularly as it allowed for completion of 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 first party copayment required. More specifically, the review and processing of more than $14.1 billion from 22 million invoices to date would cease if the CPS 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 available among resellers for brand name IBM FCI software. In accordance with FAR 16.505(a)(4)(iii)(A)(1), this justification will be provided with the solicitation to all appropriate NASA SEWP V GWAC 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 SAM.gov 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 August 2021. The 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 CPS 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 CPS.

Additional market research was conducted in August 2021 by utilizing the NASA SEWP Provider Lookup tool to determine whether the brand name IBM FCI is available from NASA SEWP V GWAC holders. It was determined that there are several resellers of the brand name IBM FCI software that hold current GWACs.

The results found 22 Service-Disabled Veteran-Owned Small Businesses, 47 small businesses, and 33 large businesses. Furthermore, NASA SEWP V GWAC has a dynamic catalog where line items can be added based on customer requests;

therefore, as long as the required item or service is within scope of the NASA SEWP

V contracts, items and services can be added to the catalog on a daily basis.

9. Other Facts: None.

Approval