The Social Security Administration has assigned four vendors specific jobs within a multibillion-dollar contract to support the agency's modernization program, rather than have the companies compete against each other for the work, agency officials said on Friday.
The decision differs from some procurement specialists' expectation that the agency would let the contract winners Lockheed Martin Corp., Accenture, Computer Sciences Corp. and Northrop Grumman Corp. bid on certain tasks to encourage competition. Instead, Social Security will reserve the right to replace one supplier with another, if any of the companies do not keep costs low or fail to complete work on time, officials said.
On Monday, SSA contract officials announced the winners of a deal worth up to $2.8 billion for help on all information technology systems, as well as digitizing many agency services, including the issuance of Social Security cards and the transfer of medical records to determine who is eligible for benefits.
During the seven-year contract period, Lockheed will support software development. Accenture will concentrate on electronic health records and emerging technologies, possibly including voice recognition and data mining. CSC will help with application validation, software engineering and systems administration for the operating systems z/OS, Unix, Windows and IBM WebSphere. Northrop Grumman's assignments include application and business planning, as well as enterprise architecture, which is the practice of driving operational change by comparing how an agency functions today versus future performance expectations.
"There was intense competition among vendors for both receiving a contract award and for the technical areas," Social Security spokeswoman Kia Green said. "There will be competition in the form of proposals for any new technical areas, but, as of now, each vendor has been awarded specific technical areas and there is no competitive bidding for projects in a technical area."
Health IT is a significant part of the massive initiative, which is aimed at reducing a backlog of applications for disability insurance, expediting the processing of benefits claims and offering more online services. Social Security operates the largest repository of scanned medical information in the world, according to SSA officials.
"The agency collects and currently stores more than 250 million medical documents and adds 2 million more weekly," the contract's request for proposals stated. "In order to effectively manage the largest social insurance system in the world, the agency must be at the forefront of the health care industry's transition to electronic record-keeping and data sharing."
Recently, Lockheed linked Social Security's computers to the nationwide health information network, a government-designed architecture for exchanging e-health records among medical practices nationwide.
Accenture folded its health care business into its public sector division a year ago to position itself for the type of contract Social Security awarded on Monday, company officials said.
"When we put our health and public services together a year ago, this was exactly the kind of work we wanted to do," said Steve Shane, managing director of Accenture's federal health program.
He pointed to the challenge Social Security faces in serving an increasing number of baby boomer beneficiaries. "The demographic surge coming at them is going to drive the need for their services even higher," Shane said. The job will demand SSA "provide faster and cheaper services, but with a higher rate of satisfaction from its constituents."
Accenture has experience in delivering such services for the Internal Revenue Service and Education Department, he added. The company enhanced the Where's My Refund? feature on IRS.gov, which allows taxpayers to check the status of their refund payments. And Accenture helped create the Education IT system that disburses billions of dollars in student loans and grants each year.
Shane anticipates all four contractors will have a role in safeguarding public data. "SSA is passionate about protecting the citizen's data. My belief is everybody will have to be on top of that, as an extension of SSA," he said.
Lockheed, which had been supporting SSA under the contract's predecessor program, will continue working on application design, development, testing and maintenance; database management; image-scanning; and document input and retrieval, company officials said on Wednesday.
The government work -- worth $2.5 million per company, at a minimum -- will boost hiring at Lockheed. "We anticipate this award will result in continued growth and are actively seeking talented individuals to join our team," Lockheed spokeswoman Kimberly Jaindl said.
CSC and Northrop Grumman officials said they were waiting for guidance from Social Security before speaking publicly about the contract.