Redacted Pharmacy Bill Processing Services JOFOC_Redacted.pdf

(J&A DOL 21-13)

Justification for Other than Full & Open Competition

1. Identification of the agency and contracting agency:

Contracting Activity Customer Agency U.S. Department of Labor U.S. Department of Labor Office of Acquisition Services Office of Workers’ Compensation Programs 200 Constitution Ave., N.W. 200 Constitution Ave., N.W.

Washington, DC 20210 Washington, DC 20210

2. Nature and/or description of the action being approved:

The Department of Labor, Office of the Senior Procurement Executive (OSPE), Office of Acquisition Services (OAS), intends to award an interim (bridge) contract on behalf of the Office of Workers’ Compensation Programs (OWCP), utilizing other than full and open competition. OAS intends to award a firm-fixed contract to Conduent Federal Solutions, LLC, 12410 Milestone Center Dr. FL 5, Germantown, MD 20876 for pharmacy bill processing services. The current contract ( ) expires on April 30, 2021.

The period of performance for this contract will commence on May 1, 2021 and will include a twelve-month base period and two, six-month option periods. The contract will include FAR clause 52.217-8, Option to Extend Services, which may extend the period of performance for up to six months.

3. Description of supplies/services required to meet the agency’s needs (including the estimated value):

To maintain mission-critical services past April 30, 2021, OWCP requires an interim contract to continue pharmacy bill processing services without gap for claimants under the Federal Employees’ Compensation Act (FECA), Black Lung Benefits Act, Energy Employees Occupational Illness Compensation Program Act (EEOICPA), and Radiation Exposure Compensation Act.

The Contractor shall interface with the OWCP District Offices and OWCP National Office staff for each program in the performance of these activities.

The primary goals of the OWCP pharmacy bill processing strategy continue to be:

• To ensure efficient, accurate and timely bill processing for OWCP providers and claimants. Accurate processing refers to the correct implementation and maintenance of business rules and practices for each program, and the application of industry standards for pharmacy bill processing.

• To ensure claimants’ timely authorization for covered benefits.

system to process bills in accordance with OWCP’s highly specialized business rules, in addition to providing a platform that incorporates industry-standard bill processing rules.

Conduent Federal Solutions LLC, maintains all software rights to the proprietary systems currently used in processing OWCP pharmacy bills. Only Conduent Federal Solutions LLC has the current ability processing complex calls regarding pharmacy bills according to the unique business rules and eligibility requirements of the three OWCP programs. The authorization and treatment suite rules were developed specifically by OWCP during the course of the Conduent Federal Solutions LLC contracts, and are outside the experience or present capability of other contractors. Continuation of pharmacy bill processing services at the current service levels must be maintained to process pharmacy bills for OWCP beneficiaries and to meet the demands of OWCP beneficiaries, Federal agency employers, Federal regulations, and Congress.

Furthermore, it is impractical to attempt to award a short-term contract to any other source as it would result in unacceptable delays in fulfilling the agency's requirements.

Any new vendor would need to significantly adapt its commercial pharmacy bill processing systems to accommodate OWCP bill-processing rules. OWCP limits an injured worker's pharmacy benefits to the condition(s) accepted by the program, unlike the simple industry model that most pharmacy bill processing systems use based on enrollment. A non-customized, off-the-shelf system could not possibly process OWCP pharmacy bills according to OWCP business rules. The result would be an unacceptable risk of making invalid or improper payments. It is estimated that it would take up to twelve months to customize, test and implement pharmacy bill processing services using a new vendor’s system and OWCP business rules. This short-term contract to Conduent Federal Solutions LLC will provide adequate time to award a new contract and transition to a new contractor, if necessary, in a manner that will not disrupt services.

6. A description of efforts to obtain competition to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by subpart 5.2 and if not, which exception under 5.202 applies:

OAS will issue a Notice of Intent to Sole Source in the Government-wide point of entry.

Furthermore, OWCP is in the requirements gathering and planning stages of a competitive acquisition to replace these short-term services with an expanded scope of Pharmacy Benefits Management (PBM) for non-FECA programs. However, the solicitation process is estimated to take up to 12 months, followed by a development and implementation phase up to 12 more months. In the meantime, OWCP will continue to survey the market to identify suitable providers of like services.

7. A determination by the contracting officer that the anticipated cost to the government will be fair and reasonable:

The Contracting Officer has determined that the anticipated costs to the Government for the supplies/services covered by this justification will be fair and reasonable. Prior to the award of the proposed contract, cost or pricing information will be obtained from Conduent Federal Solutions LLC and price and/or cost analysis will be performed and documented to sufficiently determine that the cost to the Government of the proposed acquisition will be fair and reasonable.

8. A description of market research conducted (part 10) and the results or a statement of the reason market research was not conducted:

OWCP has conducted market research through a survey of the marketplace. While pharmacy bill processing services are generally available in the marketplace, OWCP requires extensive configuration of commercially-available services in order to meet its needs. Based on fifteen

(15) years of historical activity and the levels of effort and costs associated with the current services, a new vendor would need to significantly adapt commercial processing systems to accommodate OWCP’s unique and extensive pharmacy bill processing rules because OWCP limits an injured worker’s medical benefits to the condition(s) accepted by the programs, rather than following the usual industry model for bill processing based on enrollment.

While many companies provide a broad range of centralized mailroom services, any commercially-available solution would require at least twelve months of development and testing to meet OWCP requirements. The systems that are currently utilized are proprietary to Conduent Federal Solutions LLC. No other contractor can use these systems and no other source is capable of providing a system to perform this work immediately.

9. Any other supporting facts supporting the use of other than full and open competition:

This requirement is closely tied to the FECA PBM requirement, as FECA services will transition from Conduent to the PBM at an upcoming date. The FECA PBM underwent an extended period of protest and corrective action that had to be resolved before finalizing the details of the instant requirement. GAO did not reach its decision until February 2021. At this time, as explained above, there is only one responsible source, Conduent, that can provide the required pharmacy bill processing services needed May 1. This requirement is intended to be a relatively short-term contract while an enhanced scope of services for non- FECA programs is developed and competitively procured; other offeror(s) may develop the capacity to meet the need; and the requirement is implemented.

Without a fully-functional pharmacy bill processing solution in place on May 1, 2021, payments for pharmacy services for the tens of thousands of OWCP’s FECA, Black Lung, and Energy beneficiaries would cease. The consequences of ceasing services would be extremely deleterious to OWCP and the Department of Labor (DOL). Not only would OWCP and DOL be guilty of violating several statutes (the Federal Employees' Compensation Act, as amended and extended, 5 U.S.C. 8101 et seq.; the Black Lung Benefits Act, as amended, 30 U.S.C. 901 et seq., including 26 U.S.C. 9501; and the Energy Employees Occupational Illness Compensation Program Act of 2000, as amended, 42U.S.C. 7384, et seq.), but this failure would also result in financial and health costs to the covered beneficiaries. The impact of delayed pharmacy processing services would require that beneficiaries pay the costs out-of-pocket or skip medications. The impact could be disastrous to individual beneficiaries, with financial ruin and worsening of medical conditions as a result.

10. A listing of sources, if any, that expressed, in writing, an interest in the acquisition:

No sources expressed interest in this acquisition.

11. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required:

OWCP is working with OSPE on soliciting an award for full Pharmacy Benefits Management that will expand on and replace the current requirements. Extensive market research is being performed to ensure the widest possible industry participation in the coming competition.

12. Signature blocks:

The program/technical official further certifies that no conflict of interest exists in awarding a sole source contract to the contractor identified herein.

Technical Certification:

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

Signature: Date: 3/8/2021

Type name:

Title: _Program Analyst

Contracting Officer Certification:

I certify that this justification is accurate and complete to the best of my knowledge and belief.

Signature: _____ Date: 4/12/2021

Type name:

Title: Division Chief/Contracting Officer

Approval

Based on the foregoing justification, I hereby approve the procurement under an other than full and open competition basis pursuant to the authority of 41 U.S.C. 3304(a)(1) as implemented by FAR 6.302-1 and provided that the services and property herein described have otherwise been authorized for acquisition.

Signature: Date:

Head of Contracting Activity Office of the Senior Procurement Executive

4/16/2021