All HHS Contracts — June 24, 2026

Leidos secured a $167M time-and-materials delivery order from CMS for hosting operations and end-user support for over 300 business applications, with total potential value of $217M through 2027. Full-and-open competition with no set-aside indicates Leidos won against other large IT services firms, signaling competitive strength in civilian health IT.

Time-and-materials pricing carries medium risk for cost overruns or scope creep, potentially pressuring Leidos' margins on the $167M contract if CMS demands additional unplanned services.

As a civilian contract awarded in September 2022, this CMS delivery order is vulnerable to funding delays or reductions under a continuing resolution (CR) scenario, especially if Congress fails to pass full-year appropriations for HHS.

This single contract represents a small fraction (0.3%) of Leidos' ~$15B annual revenue, but its health IT segment is a key growth driver; any re-compete loss could signal competitive erosion in civilian IT services.

Leidos' win of a full-and-open competition for CMS hosting positions it for follow-on task orders or extensions, given the multi-year performance period through 2027. The $126M already outlaid suggests strong funding momentum.

While this is a civilian contract, Leidos' proven IT hosting capabilities for CMS could translate into similar opportunities with DOD health systems (e.g., MHS GENESIS), though no direct defense linkage exists in this award.

HHS/CMS continues to invest in IT hosting and support for major healthcare systems, as evidenced by Leidos' $167M contract to host over 300 business applications. This signals stable demand for large-scale IT infrastructure services in the civilian health sector.

{"entity"=>"Leidos (LDOS)", "reason"=>"The $167M CMS contract provides multi-year revenue visibility but represents a small portion of total revenue; option exercise decisions and re-compete outcomes will signal competitive positioning.", "trigger"=>"Option exercise decisions by CMS in 2025-2026; follow-on contract announcements for CMS hosting services"}

{"entity"=>"HHS/CMS IT services sector", "reason"=>"Full-and-open competition with no set-aside suggests large IT services firms (Leidos, GD, BAH) are competing aggressively; any shift toward set-asides could alter competitive dynamics.", "trigger"=>"New CMS IT RFP announcements; changes in HHS procurement policies"}