GSA unit uses tech contract to acquire mental health services

Amid an ongoing investigation into misuse of contracts at the General Services Administration's Federal Technology Service, the agency has awarded a large deal to provide mental health and counseling services to military personnel using a contract designed to buy information technology.

In August, FTS, which purchases goods and services for other agencies on a fee-for-service basis, awarded Titan Corp. a $229 million task order to build "an enterprise-wide IT system" so military members and their families could obtain "family assistance services" through the Internet, e-mail and the telephone, according to a company statement.

Titan traditionally sells communications and combat systems to the military, but under the terms of the task order, it must deliver more than a dozen different counseling and referral services, including "emotional well being" counseling, advice on caring for the elderly and substance abuse counseling. BTG Inc.-which Titan recently acquired-was one of 11 companies allowed to bid on the order under FTS' Millennia Lite contract for technology services. None of the companies are health care providers.

Award of the task order is significant because the GSA inspector general has reprimanded FTS for using technology contracts to buy unrelated items. A nationwide investigation revealed that FTS employees in Bremerton, Wash., used technology contracts to buy construction services for the Army, misusing almost $40 million in the process.

Titan has hired another firm, Ceridian Corp., to provide an employee assistance program (EAP) for the military. A Ceridian spokesman said the company, a leader in the payroll processing industry, has little experience working for the military on such projects.

The Defense Department has tried for more than a year to hire an EAP services company. In June 2002, officials at the Defense Department Education Activity, which runs schools for the children of military personnel and department employees, issued a solicitation for such services in which they announced they planned to use the GSA schedules-a set of pre-negotiated contracts with agency-approved vendors-for the procurement.

A mental health care provider, ValueOptions of Reston, Va., wrote to Defense officials on July 1 to challenge the solicitation, arguing that since many of the nation's mental health providers aren't represented on the schedules, they would be unfairly excluded from the bidding, according to memoranda sent to Defense by ValueOptions' attorneys.

The Defense Education Activity defended its actions later in July in response to ValueOptions' challenge. However, less than a month later, after the company formally protested the solicitation to the General Accounting Office, Defense canceled it.

According to a memo written by a ValueOptions' attorney at Latham & Watkins, a law firm in Washington, the Defense education agency "agreed that its actions improperly restricted competition, and it agreed to settle the matter by canceling its solicitation" and issuing a new one that would be fully open.

A Pentagon spokesman said Tuesday that the solicitation was canceled because its funding was withdrawn.

The EAP services contract took on new life in April of this year, when a Defense program manager contacted an FTS associate in its Denver office with whom he'd worked before, and asked the office to issue a new procurement, said Mary Alice Johnson, a GSA spokeswoman.

FTS issued the solicitation to its Millennia Lite vendors. A comparison of its specifications to those of the previous solicitation issued by the Defense education agency show that the mental health services sought in each are nearly identical.

This prompted ValueOptions' attorneys to write to the FTS regional office in Denver to challenge the effort. The task order, they charged, "is largely a recast version of the [previous solicitation] for EAP services." The new contract, they said, "was being camouflaged as an IT procurement."

Technology and communications equipment merely assist the delivery of EAP services, the attorneys argued. "Any attempt to characterize [this task order] as an IT procurement would be comparable to arguing that you can use an IT contract to buy automobiles simply because they use computers," the attorneys wrote.

GSA's Johnson said the services were awarded under an IT contract because Defense's plan called for database development and the use of online systems. Those components "are rarely stand-alone requirements," she said. "Instead, they are means to access non-IT information or services."

The database and online services components are "clearly IT," Johnson said. "The third component, actual EAP services, is not."

Spokespersons for Titan and Ceridian said EAP services are a significant part of the contract, and that the point of constructing the online system is to deliver those services.

The GSA inspector general's office declined to comment on whether it was investigating the task order award. Johnson said FTS had consulted with GSA policy officials and the agency's general counsel about the procurement.

Requests for comment from the general counsel's office went unanswered.