CMS Revs Up Data Centers, Awards $228M in Contracts to CDS

BALTIMORE–As part of its plan to modernize Medicare operations
and lower costs by establishing enterprise data centers, CMS has
recently awarded two contracts valued at $228 million.

Last week, the agency awarded a six-year, $28 million contract
to Columbia, S.C.-based Companion Data Services for hosting
operations to support its 1-800-MEDICARE national data warehouse.
The Medicare help line operates 24/7, and customer service
representatives answer about 40 million calls each year, according
to CDS.

In February, CDS also snagged a $200 million six-year contract
to support electronic data processing and hosting operations for
approximately 650 million fee-for-service claims submitted in 30
states, the District of Columbia and Puerto Rico. The contract
represents the majority share of a CMS task order for the
processing of 841 million Medicare claims per year.

CDS said the contract will result in about 40 new jobs at its
program management office in Dallas, and 10 new positions at its
data center in Columbia, S.C. The additional workload means
approximately 54 percent of all Medicare claims will be processed
through CDS’ data center by January 2008.

Both contracts are part of CMS’ plan to consolidate more than 20
current data centers in order to expand electronic services,
bolster security and lower costs. In 2006, the agency awarded a
10-year contract to three companies to operate new data centers:
CDS, EDS and IBM. The selection qualified those companies to
compete for approximately $1.9 billion in work, CDS said.

CDS is a wholly owned subsidiary of BlueCross BlueShield of
South Carolina.