The overall score for this Request for Proposals is 59 percent, making it moderately risky.
This request for proposals (“RFP”) is for the provision of services under the New York City Human Resources Administration’s Wellness, Comprehensive Assessment, Rehabilitation, and Employment Program (“WeCARE”). WeCARE consists of “a continuum of integrated services that evaluates the abilities, addresses the needs, and determines the functional capacity of Cash Assistance (“CA”) clients with medical and/or mental health condition(s) that may affect employability as well as other individuals identified by HRA who may have medical and/or mental health condition(s).”
Initiated in February 2005 by the Bloomberg administration to reduce the number of New Yorkers receiving public assistance, WeCARE is the quintessential “welfare-to-work” program for people with disabilities. Former social services monolith FEGS was once a primary holder of WeCARE contracts, with a few other nonprofit and for-profit organizations holding the rest. The program has a reputation for inadequate funding and unrealistic program goals.
Punitive Payment Structure
WeCARE contracts have a term of three years, with the option to renew for up to three more years. During the contract term, the payment structure transitions from line-item reimbursement in the first year to a hybrid line-item/performance-based model. In years two and three, the payment structure is 70 percent line-item reimbursement and 30 percent contingent on the achievement of milestones to be agreed upon by HRA and the awardee. The RFP provides: “Performance measures, outcomes and operational budgets are subject to change at the discretion and/or written approval of HRA/CAS. This includes the right to adjust a Contractor’s not‐to‐exceed amount to account for performance.”
This payment structure is punitive and, in conjunction with the program goals discussed below, puts awardees at grave financial risk. While in year one awardees can recover their costs, they stand to lose up 30 percent of their costs in years two and three if they fail to meet milestones that are subject to change. As HSC has advocated in the past, all contracts should allow providers to recover their costs (at least in the absence of wrongdoing), and performance-based contracts should include incentives or rewards for the attainment of tested, reasonable targets. Applicants should note that the RFP prohibits the use of Medicaid funds for the contracted services. Thus, awardees cannot offset the serious financial risk presented by this RFP with Medicaid dollars.
Unclear Program Goals
As discussed above, the WeCARE program becomes punitive in the second contract year based on milestones that are agreed to by HRA and the awardee. Applicants must propose milestones and a rate of pay for achieving those milestones. Unfortunately, the RFP does not provide sufficient information for determining what the real costs of service might be, particularly with respect to the employment outcomes.
For example, Attachment I, “Performance History”, tells how many individuals secured employment but does not indicate how many maintained employment for 365 days. Beyond this, there simply is not enough information about the client population. Similarly, the Performance History attachment does not indicate how many targets were not achieved. This information is important because it would help providers determine the appropriate staffing levels. There simply is not enough information about the client population. In addition, the RFP mentions additional testing (e.g., EKGs and bloodwork) but gives no specifics. One thing that is clear, however, is that the WeCARE program requires tremendous scale on the part of both contractors and subcontractors. The payment structure and program goals pose greater risk for smaller organizations.
Limited Provider Autonomy
This RFP includes contingencies that bear more than just financial risk. For example, HRA reserves the right to interview key staff, though it promises not to withhold approval unreasonably. Such approval would limit provider autonomy, increase administrative burdens, and slow the hiring process.
The RFP also requires that awardees be prepared to serve clients of other sites in the event that those sites become unavailable for two weeks or more. This creates the potential for additional liability and logistical problems for awardees, and it is not clear how awardees would be paid for this type of emergency service. Furthermore, awardees must serve all individuals referred to them by HRA.
According to the RFP, HRA intends to provide awardees with a comprehensive electronic case management system. Unfortunately, HRA does not expect that system to be operational until after the WeCARE contract start date. Awardees are expected to have their own electronic case management systems in place in the meantime but does not set aside funding to cover the cost of such a system—one that will be used only temporarily. Nor does it provide detail on the process by which providers will be trained to use the new system once it becomes operational. In addition, the requirements for the temporary system are copious and extremely restrictive.
The technology component is a significant unknown. The RFP gives no detail on the system that it is developing, and it is possible that this system, like others before it, will allow only import and not export of data. Thus awardees may have to enter the same data into multiple systems if they want to ensure continued access to their information, thereby increasing their administrative workload.
The HSC RFP Rater assesses the feasibility, opportunities, and risk in City and State human services procurements. Rater scores are based on the RFP and related documents available to the public via New York City’s HHS Accelerator or New York State’s Grants Gateway. The rater consists of 60 questions developed and tested by a team of procurement professionals. The questions are based on information that is necessary to help prospective proposers assess risk.
Each answer is weighted based on the degree of risk inherent in the subject of the question. Answers that imply low to moderate risk are allotted points on a lower scale range compared to higher risk questions. For compound questions, the answer to both parts must be “yes” or “not applicable” to be considered low risk. Scores are calculated by adding all the question scores together. The higher the score, the greater the risk. The scoring range is from 60 to 230, with zero percent risk equal to a score of 60 and the maximum risk score or 100% equal to 230 points. Users can view the answer to each question by clicking the down arrow next to each section to expand the section.
The HSC RFP Rater does not substitute for the due diligence necessary to inform each individual organization’s decisions.