The State of Federal Health IT Contract Reform

1. The State of Federal Health IT Contract Reform National Capital Area Healthcare Information and Management Systems Society Chapter Meeting January 20, 2011

2. Panel Members • Daniel Kane, Moderator Acting Director Office of Acquisition and Grants Management Centers for Medicare and Medicaid Services (CMS) • Mary Armstead, Speaker Director NIH Information Technology Acquisition and Assessment Center (NITAAC) National Institutes of Health (NIH) • William E. Newell, Speaker Chief Information Technology Development Division Technology Acquisition Center Department of Veteran’s Affairs (VA)

3. Information Technology (IT) and Mission Success • No Federal agency can accomplish its mission without effective IT management • Federal Government spent $600 billion in IT investments in past decade • Acquisition team consists of: • technical, supply, and procurement staff • customers • finance and legal personnel; and, • contractors who provide the products and services • Industry collaboration is critical!

4. Exchanges with Industry • Federal Acquisition Regulation (FAR) 15.201(a) encourages the early exchange of information on Government requirements • Exchanges: • must be consistent with procurement integrity requirements at FAR 3.104 • can improve the understanding of Government requirements and industry capabilities • are encouraged early on for future acquisitions • Techniques – Many different techniques for doing so including, but not limited to: • Sources Sought notices • Requests for Information • 1-on-1 market research sessions with contractors

5. Our Business is Changing • Significant political interest in how we run our business: • Presidential/OMB Memos • March 4, 2009, Government Contracting • July 29, 2009, Improving Government Acquisition • October 27, 2009 Increasing Competition and Structuring Contracts for the Best Results • October 27, 2009, Acquisition Workforce Development Strategic Plan for Civilian Agencies – FY 2010 – 2014 • December 22, 2009, Achieving Better Value from Our Acquisitions • April 2010, GAO Report on IDIQ or MAC vehicles • September 14, 2010, Accountable Government Initiative • December 9, 2010, 25 Point Implementation Plan to Reform Federal Information Technology Management • OFPP Focus • Demonstrating Fiscal Responsibility • Acquisition Workforce • Rebalancing our Contractor Relationships

6. Other IT Reform Memoranda • M-10-19, Fiscal Year 2012 Budget Guidance • M-10-25, Reforming the Federal Government’s Efforts to Manage Information Technology Projects • M-10-26, Immediate Review of Financial Systems IT Projects • M-10-27, Information Technology Investment Baseline Management Policy • M-10-31, Immediate Review of Information Technology Projects

7. 25 Point Plan for IT Reform • Vivek Kundra, Federal CIO issued 25-Point plan on December 9, 2010 • Based on concepts of cloud computing, modular development, and sound program management • Five Main Initiatives • Applying “light technology” and shared solutions • Strengthening program management • Aligning acquisition and budget processes with the technology cycle • Streamlining governance and improving accountability • Increasing engagement with industry

8. IT Acquisition More Complex • The Good News • Administration recognition to recapitalize the acquisition workforce and invest in its capacity and capability and provide other tools to allow us to buy IT more efficiently and effectively • Industry and Government want to work together to solve problems • Our Challenges • A lot of change - acquisition staff are challenged to keep up with new and changing acquisition rules, directives and other guidance • Will not immediately see capacity and capability improvements

9. CMS IT Contracting • More than $1B spent annually on our IT efforts • Complex data rights and use issues, conflicts of interest, and technology challenges • Complicated security issues • Many stakeholders with whom we must interact/interface • January 1, 2011 Electronic Health Record (HER) for Healthcare providers began - $20 billion

10. NSC 1-800 Medicare, BCC High Level Medicare FFS System-Entity Interaction July 2010 Provider/ Supplier Systems OSCAR,UPIN,PECOS, NPES Bank Run-time claims interface. Data not duplicated Beneficiaries Beneficiary Systems SSA RRB MBD, EDB To CWF MSN Facilities & Institutions Payment Data FISSDDE CFO Rptg 1099 Rptg MAC or FI Pymt Info HIGLAS DMAC FISS MAC or Carrier MAC/FI EDI IDR Clearinghouse Physicians Claim, Prior Notices, Approvals Claim, Prior Notices, Approvals MAC/Carrier CEM MCS DMAC CWF CEDI VMS Shared Systems Third Party Billers Medical Equipment Suppliers ReMAS Workload Reporting NCH Claim Responses, Remittance Advice Claim Responses, Remittance Advice Claim/Elig. & Util. PULSE Adjustments from RAC, QIO Prior Apprvls, MSP, Eligibility Info CAFM PS&R CROWD To Providers From PS&R CERT, PSC, QIO Interaction with Providers Claims from Shared Systems Claims from Shared Systems Adjustments to Shared Sys MSP, Eligibility Info Claims from shared systems Adjstmts & Prior Approvals Claims from NCH Claim Errors Claims from NCH Claims from NCH PDAC Coordination of Benefits Contractor Recovery Audit Contractors Claims subset CERT Contractors Quality Improvement Organizations Program Safeguard Contractors ‘ZPICS’ From Shared Systems CERT Documentation Contractor Status from Shared Systems COB Info 837 Claims COB Info Dual Elig 837 Claims Appeals Employers OIG / Law Enforcement State Medicaid Agencies Other Payers Claims from NCH Administrative Law Judges Qualified Independent Contractors Manual Claims Entry into MAS Researchers Version 3 – 7/20/2010

11. Panel Discussion Question #1: Which of these directives are affecting your procurement strategies and why?

12. Panel Discussion Question #2: To achieve these new directives, what are your lessons learned from how you interact with industry and how you evaluate your partners for award?

13. Panel Discussion Question #3: When do these directives not work and what are the barriers?

14. Panel Discussion Question #4: How have these directives changed how you work with your agency and customer agencies business operations to procure new contracts?