ADP Systems

Concerns About DOD's Composite Health Care System Development Contracts Gao ID: IMTEC-87-25 June 8, 1987

GAO reviewed the Department of Defense's (DOD) award of initial systems development contracts for the acquisition and implementation of the Composite Health Care System (CHCS).

GAO found that: (1) DOD received six proposals for CHCS system development contracts, but it failed to conduct required discussions with offerers, which caused a 3-month program delay and increased costs; (2) DOD did not attempt to resolve certain apparent uncertainties and suspected mistakes in unacceptable proposals because it believed that the proposals could not be made acceptable through further discussions; (3) DOD failed to document discussions with offerers for revised proposals or any agreements reached in contract negotiations; (4) DOD did not consider all relevant cost factors as a result of adding a fourth proposal to the competitive range; (5) changes in the DOD acquisition strategy increased contract costs to $7 million; (6) DOD expected to reduce individual system development costs through cost-sharing arrangements, but did not have a reasonable basis to negotiate a fair cost-sharing agreement because it failed to verify proposed contributions; and (7) greater participation and documentation of discussions with contractors is necessary to achieve full compliance with federal acquisition regulations.


Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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