Cahaba Safeguard Administrators, LLC (APP210813)

B-419924 Sep 28, 2021 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Bland & Associates, PC, of Omaha, Nebraska, protests the terms of request for quotations (RFQ) No. APP210813, issued by the Department of Health and Human Services, Centers for Medicare and Medicaid Services, for audit services. The protester argues the agency erred by amending the solicitation to permit certain vendors with allegedly unmitigable organizational conflicts of interest (OCI) to compete. We deny the protest. View Decision DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This version has been approved for public release. Decision Matter of:  Bland & Associates, PC File:  B-419924 Date:  September 28, 2021 Scott A. MacGriff, Esq., Dickinson Wright PLLC, for the protester. Daniel P. Graham, Esq., Tyler E. Robinson, Esq., John M. Satira, Esq., Olufunmilola Anifowoshe-Manning, Esq., Vinson & Elkins LLP, for Novitas Solutions, Inc., the intervenor. Pamela Waldron, Esq., and William Shim, Esq., Department of Health and Human Services, for the agency. Michael Willems, Esq., and Edward Goldstein, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1.  Protest of the terms of a solicitation filed on next business day after the time set for receipt of quotations is untimely, but because our Office was unexpectedly closed when the protest would have been due, we will consider the protest for good cause shown. 2.  Protest alleging organizational conflicts of interest is denied where the protester has neither demonstrated that a conflict exists nor that the agency’s consideration of potential conflicts was unreasonable. DECISION Bland & Associates, PC, of Omaha, Nebraska, protests the terms of request for quotations (RFQ) No. APP210813, issued by the Department of Health and Human Services, Centers for Medicare and Medicaid Services, for audit services.  The protester argues the agency erred by amending the solicitation to permit certain vendors with allegedly unmitigable organizational conflicts of interest (OCI) to compete. We deny the protest. BACKGROUND On May 19, 2021, the agency issued the Medicare Audit Desk Review and Intern and Resident Information System Duplicates (MADRID) RFQ seeking a variety of audit and audit-related services.  Memorandum of Law (MOL) at 2-3.  The RFQ was issued to contract holders of the General Services Administration’s Multiple Award Schedule for Professional Services, Business Administrative Services, Category 541611, Administrative Management and General Management Consulting Services.  Id.  The RFQ contemplates the issuance of a single time-and-materials task order with a 1-year base period of performance and two 1-year option periods.  Agency Report (AR), Tab 8.1, Amended RFQ Instructions at 1. The RFQ requires vendors to include an OCI volume in their quotations to explain and mitigate any potential OCIs.  Id. at 7.  As initially issued, the RFQ additionally excluded three categories of vendors from the competition due to perceived unmitigable OCIs.  AR, Tab 1.3, RFQ Clauses and Terms at 13.  Relevant to this protest, the original RFQ excluded the 12 contractors currently performing as Medicare Administrative Contractors (MACs).  Id.  The solicitation explained: As the work to be performed by the successful offeror will correspond to traditional MAC work, a current MAC would be able to steer work from their MAC contract and workload to the MADRID contract, at potentially higher rates at a dis-advantage to the government. A potential conflict of impaired objectivity could exist if the successful offeror were to be a current MAC. Id. That is to say, the MACs are performed using a cost-plus-award-fee structure, and the MADRID will be a time-and-materials task order.  Because the MADRID contractor will be performing backlog or overflow work of the same kind as that performed by the MAC contractors, the agency was concerned that the MADRID vendor could propose comparatively high time-and-materials rates and then manipulate its backlog to effectively reallocate work that would potentially be less remunerative under the MAC contract to the MADRID contract.[1] Following the issuance of the RFQ, the agency received numerous questions from potential vendors and issued several amendments to the RFQ.  MOL at 4.  Of note, in response to one vendor’s query, the agency reconsidered the issue of whether MACs should be categorically excluded from the MADRID competition.  Id.  Specifically, after internal discussion, the agency determined MACs would not necessarily be able to steer work to the MAC contract, and the categorical exclusion of all MACs was not defensible.  Id.