CMS sheds light on $4 billion contracts

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The Centers for Medicare & Medicaid Services’ (CMS) recently awarded $4 billion contracting vehicle is intended to create an IT resource to help the agency technologically deal with the rise in the number of health benefits recipients.

In 2000, Medicare recipients numbered nearly 40 million, and by 2030, the number is expected to top 77 million, according to the Health and Human Services Department.

CMS has employed 16 contractors, eight large businesses and eight small firms, for a decade-long enterprise systems development program (ESD) to provide services ranging from application design to software maintenance. The ultimate goal of these contracts is to update the state of CMS technology, according to the agency.

The ESD vehicle will build new claims systems with “the flexibility to meet rapidly changing requirements” and “the scalability to meet the new demand,” according to Amy King, director of the Healthcare Systems Management division at ESD contract holder Northrop Grumman. Another aim is to “implement technology solutions that drive out excess cost of providing beneficiary services and healthcare,” King added.

Many of the contractors had a history with CMS. Contract holders EDS and IBM, for example, also hold CMS’ multiple-award, $1.9 billion Enterprise Data Center contract, awarded in 2006. The ESD contract marks a “broadening of the relationship” with CMS, said an EDS spokesman.