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March 20, 2012 By AMK

VA abruptly cancels key software contract, cites conflicts of interest

The Veterans Affairs Department abruptly terminated a $102.6 million contract awarded to ASM Research in January to develop software vital to an integrated electronic health record system that will serve both VA and the Defense Department.

A VA spokeswoman confirmed the contract cancellation, but provided no details. Industry sources told Nextgov that VA was concerned about potential organizational conflicts of interest and violations of federal contracting law, due to the fact that one or more ASM subcontractors had inside, nonpublic information about the procurement when it was put out for bid.

ASM has not responded to a request for comment from Nextgov.

VA Chief Information Officer Roger Baker said in an interview with Federal Times in early February that the contract with ASM called for the company to develop a middle layer of software for the integrated electronic health record (iEHR) called an enterprise service bus, which he described as “the heart of the iEHR.” Baker said the ASM software would ensure any application could communicate with any database in the iEHR.

The department awarded ASM the contract as a task order off its $12 billion Transformation Twenty-One Total Technology, or T4, contract for a range of information technology services in July 2011. Industry sources told Nextgov that Harris Corp., HP Enterprise Services, SAIC, SRA International and 7 Delta, a disabled veteran-owned small business, submitted competing bids for the service bus contract.

Top leadership of VA and Defense agreed to develop the iEHR in March 2011. Last Friday, in his monthly press call, Baker said the enterprise service bus contract was the first large contract jointly executed by the two departments for the health record project. “It’s the first major acquisition that we went out and did together to establish a standard piece of the iEHR,” he said.

Industry sources told Nextgov that the organizational conflict of interest that led to the termination of the contract stemmed from officials who worked for the Military Health System at the time the contract went out for bid in October 2011 and who now work for ASM subcontractors.

VA canceled the ASM contract one day after Veterans Affairs Secretary Eric Shinseki and Defense Secretary Leon Panetta met at the Pentagon to discuss joint projects, including the electronic health record. Shinseki said after that meeting, “The vision Secretary Panetta and I share is to provide an integrated, seamless experience to our people across their lifetime — from when they raise their hand to take the oath, to when they leave active service and join the veteran ranks, to when they are laid to rest with final honors . . . Over the past three years, VA and DoD have made significant progress, but more work remains.”

— by Bob Brewin, NextGov, Feb. 29, 2012 at http://www.nextgov.com/nextgov/ng_20120229_5048.php?oref=topnews.

Filed Under: Government Contracting News Tagged With: conflict of interest, DoD, health records, insider information, SDVOSB, termination, VA

June 21, 2011 By AMK

New ethics language needed for ‘at-risk’ federal contracts

Federal contracts that pose potential conflicts of interest, or possible misuse of insider information, should be addressed with new model language to be added to the Federal Acquisition Regulation, according to a proposal from the Administrative Conference of the United States that is slated for a vote on June 17.

The conference is an independent agency that advises on federal administrative and contracting rules. It is meeting in a plenary session on June 16 – 17 to vote on more than a dozen proposals regarding contracting, e-rulemaking and video conferencing.

In a 16-page document on the contractor ethics proposal released on its website, the conference defined two categories of contracts that would be addressed by new language promulgated in federal procurement rules by the Federal Acquisition Regulatory Council.

The model language would apply “when negotiating or administering contracts that pose particular risks of government contractor employee personal conflicts of interest or misuse of non-public information,” the proposal states.

To ensure that the model provision is not excessively burdensome or costly to contractors, the conference specified that it is to be applied only to Personal Conflict of Interest-Risk and Information-Risk Contracts.

The personal conflict of interest category is defined as including contracts that engage in the following activities involving inherently or nearly inherently governmental work:

  • Developing agency policy or regulations.
  • Providing “alternative dispute resolution services on contractual matters, legal advice involving interpretation of statutes or regulations, significant substantive input relevant to agency decision-making; or professional advice for improving the effectiveness of federal management processes and procedures.”
  • Serving as the primary authority for managing or administering a project or operating a facility.
  • Preparing budgets, and organizing and planning agency activities.
  • Supporting substantive acquisition planning or research and development activities.
  • Evaluating another contractor’s performance or contract proposal.
  • Assisting in the development of a statement of work or in contract management.
  • Participating as a technical advisor to a source selection board or as a member of a source evaluation board (i.e., boards designed to select or evaluate bids or proposals for procurement contracts).

In addition, the model language would apply to information-risk contracts, which are defined as contracts in which certain employees receive access to information relating to an agency’s deliberative processes, management operations or staff that is not generally released to the public.

It also applies to contracts in which certain employees will have access to trade secrets, non-public financial information, or other non-public information that could be exploited for financial gain, and contracts in which certain employees will have access to personally-identifying or other non-public personal information, such as Social Security numbers, bank account numbers or medical records.

About the Author: Alice Lipowicz is a staff writer for Washington Technology – June 13, 2011 – http://washingtontechnology.com/articles/2011/06/13/admin-conferences-proposes-new-language-for-at-risk-federal-contracts.aspx?s=wtdaily_140611

Filed Under: Government Contracting News Tagged With: conflict of interest, ethics, FAR, information risk, insider information

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