DoD-HHS contracting turmoil extends beyond Employee Assistance Program

The Department of Health and Human Services is cancelling many of its interagency agreements with DoD, affecting 18 separate shared services including the Emplo...

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Documents from the departments of Defense and Health and Human Services shed new light on last week’s sudden suspension of a host of work-life programs for DoD’s civilian workforce, while also highlighting the fact that the fissure between the departments affects much more than the Employee Assistance Program.

Last Friday, HHS officials sent DoD a formal notification that they would be ending the interagency agreement the Pentagon uses to provide EAP and other services within the next 60 days. That was several days after HHS suddenly suspended the programs before later agreeing to temporarily reinstate them.

In exercising the cancellation clause in its agreement with DoD, HHS said its Federal Occupational Health division “does not have the policies and procedures necessary” to keep providing shared services to DoD in fiscal year 2020.

Specifically, FOH cited a 2008 law that it said precluded it from procuring services for DoD. The law, codified in Section 801 of that year’s Defense authorization bill, requires non-Defense agencies to certify that they adhere to defense-specific procurement regulations if they’re ordering or purchasing goods or services for DoD worth more than $250,000.

The HHS Program Support Center (PSC) — FOH’s parent agency — “decertified” itself from meeting the Section 801 requirement in June, at the same time PSC notified DoD that it would stop providing assisted acquisition services to the department. It was evidently not clear at the time, however, that the decertification would also affect other programs PSC had handled for DoD.

On Friday, Kim Herrington, DoD’s acting director of pricing and contracting issued a separate memo listing the programs that would soon be cut off. In addition to the Employee Assistance Program, the list includes 17 other services, ranging from cloud computing to staffing support and other work-life services.

The memo allows DoD to continue getting those services from PSC for the next 60 days, but the department will need to find other sources once the interagency agreement expires.

“This waiver is necessary in order to maintain continuity of operations until follow on contracts can be awarded by the department,” Herrington wrote. “I have determined that it is necessary and in the best interests of DoD to continue contract administration of existing FOH services issued by PSC on behalf of DoD.”

HHS has not said why it suddenly believes it can’t meet the Section 801 requirements. A dozen other non-Defense agencies have certified that they do; they range in size from the Department of Homeland Security and the General Services Administration to the Northwest Fisheries Science Center and the National Technical Information Service.

HHS also cited the Section 801 requirement in June, when it notified DoD that PSC was ending the acquisition support services it provided to other agencies. That action also required a waiver from Herrington’s office so that PSC could continue to administer approximately 500 of the department’s active contracts, but PSC immediately stopped making new acquisitions on DoD’s behalf.

“We understand the predicament this puts you in,” HHS wrote in a FAQ for DoD customers at the time. “We highly recommend you contact your local contracting office for support.”

Defense and HHS spokespeople have not responded to multiple requests for details about what caused the sudden disruption to the interagency agreement or what DoD is doing to find alternatives to the services that are ending.

The suspension of the EAP program, however, appeared to have caught Defense officials by surprise. In messages to the workforce during the initial days of the service outage, Defense agency-level officials indicated they had little to no information about why the program was suddenly unavailable to DoD civilians.

On Monday, after services were restored to employees of the Defense Logistics Agency, DLA posted on its website that the disruption had been caused by “a previously unidentified contracting issue.”

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