Friday Flash 06/05/2026

June 4, 2026

The BAP Moves Forward for TRICARE Beneficiaries

On May 28^th the Defense Health Agency (DHA) announced that upcoming meeting dates and related documents for the Uniform Formulary Beneficiary Advisory Panel (BAP) should be posted soon. This is good news for the healthcare of members of the U.S. military and their beneficiaries, as well as the American taxpayer.

The Department of War (DoW)’s TRICARE Pharmacy Benefits Uniform Formulary provides for the availability of pharmaceutical agents in the complete range of therapeutic classes administered under the Pharmacy Benefit for active duty and retired service members and their families. The selection for inclusion on the Uniform Formulary of pharmaceutical agents in each therapeutic class is based on the relative clinical and cost effectiveness of the agents in such classes. The Military Health Service’s (MHS’s) Pharmacy & Therapeutics Committee (PTC) is responsible for assessing the clinical and cost effectiveness of a pharmaceutical agent and recommending whether a drug is Tier 2 and placed on the Uniform Formulary, or Tier 3 (non-formulary), meaning the drug is not available at medical facilities or retail outlets absent a valid medical necessity and usually at a higher co-pay. PTC members have expertise in treating patients in the DoW healthcare system. After the PTC review of a drug, the next step in the process is review of the PTC findings and recommendations by the BAP. The BAP is made up of representatives from non-governmental organizations and associations representing beneficiaries, and the contractors who administer the TRICARE program. The BAP provides advice and commentary on the PTC’s recommendations with respect to the Uniform Formulary. The DHA Director makes final decisions regarding the Uniform Formulary after considering the BAP’s comments on the PTC’s recommendations.

The BAP will now be able to hold public meetings to consider and comment on a series of findings of the PTC since February 2025 covering approximately 300 new drugs. This is good news because once BAP completes its review, the DHA Director will be able to make final decisions on including the subject drugs on the TRICARE formulary. The result will be increased access to cost-effective treatments for members of the US military and their beneficiaries. It also will result in lower costs for DoW as proposed drug pricing discounts are based in part on a drug’s inclusion on the formulary (Tier 2). Greater access for TRICARE beneficiaries at lower costs is a win for the warfighter, veterans, their families, DoW, and the U.S. taxpayer. Moreover, the dynamic of the PTC and BAP filling their respective roles encourages further future competition and access to new pharmaceutical treatments from the commercial market.

In sum, the announcement that the BAP process is moving forward is a positive step in the right direction. The pharmaceutical industry eagerly awaits further information on the BAP meeting(s) and the current PTC recommendations with respect to the Uniform Formulary. The result of this effort will be greater transparency in decision making (especially for beneficiaries) supporting clinically driven and cost-effective treatments/outcomes for active duty and retired service members and their families.

GSA Hosting FAST 2026 Virtual Acquisition Summit

GSA invites industry to register for the FAST GSA 2026 Virtual Acquisition Summit for Industry. FAST 2026 is a virtual event focused on strengthening partnerships between GSA and industry through expert insights, education, and direct engagement with acquisition leaders.

Date: June 16, 2026
Time: 9 a.m.–Noon ET and 1 p.m.–4 p.m. ET
CLPs: Not offered for this event

To register, click here.

As the federal acquisition environment continues to change, this event will help industry partners stay informed, adapt to new requirements, and strengthen their position in the federal marketplace.

The FAST GSA 2026 Virtual Acquisition Summit offers a prime opportunity to:

Gain expert insights into major Administration initiatives, including the Revolutionary FAR Overhaul, Procurement Consolidation, and Multiple Award Schedule reform.
Strengthen your understanding of evolving GSA and FAS acquisition processes, policies, and procedures.
Participate in interactive discussions and Q&A sessions with GSA experts.
Learn how to better align your offerings with changing government requirements and acquisition priorities.
Build stronger, more strategic partnerships with GSA and the broader federal acquisition community.

Refresh 32 Removing Changes to Joint Ventures

GSA has announced changes to the forthcoming Refresh 32. According to GSA, proposed changes regarding Joint Ventures (JV) have been removed from the current refresh. Any updates to these requirements will be addressed in a future refresh, and GSA will provide notification well in advance of any changes. Slides and Q&A discussing this change are attached to the announcement. GSA still plans on releasing Refresh 32 by the end of June.

GSA clarified the following changes:

Limit the substitution of customer references and relevant project experience for work performed by predecessor companies or key personnel to Startup Springboard and Fast Lane participants only.
Clarify that previous work substitutions may apply to both PPQs and customer references.
Add language that GSA reserves the right to request additional information to verify the legitimacy and applicability of submitted PPQs and Relevant Project Experience.
Define the term “predecessor.”

GSA Developing AI Procurement GSAR Rule

NextGov/FCW reports that the General Services Administration (GSA) is currently drafting a General Services Administration Acquisition Regulation (GSAR) rule that would prioritize procuring Artificial Intelligence (AI) using a firm fixed-price model. The GSA sources that spoke with NextGov/FCW stated that GSA will assess whether any non-fixed-price contracts could be moved to a fixed price structure after the rule’s publication. The rule would also remove certain bureaucratic hurtles for commercial acquisitions, including acquisitions of commercial AI tools.

Right to Repair Included in $1.15 Trillion NDAA

Roll Call reports that House Armed Services Committee Chairman Mike Rogers (R-AK) has released an early version of the National Defense Authorization Act for fiscal year 2027. The so called “chairman’s mark” includes a record $1.15 trillion in funding. This falls $350 billion short of the White House’s $1.5 trillion budget request. Republicans plan to fill this gap through a reconciliation bill this year. The proposed NDAA would provide $1.1 trillion for the Department of War (DoW), $42 billion for the National Nuclear Security Administrations, and about $11 billion for programs authorized by other House panels. The NDAA focuses heavily on expanding defense industrial base production. It also greenlights a number of multiyear procurements for fighter jets, destroyers, amphibious vehicles, and other items. This version of the NDAA does include “right to repair” language that would give the DoW more access to contractors’ intellectual property. This would give the DoW the ability to fix contractor provided products on their own. The committee plans to mark up the NDAA on June 4.

Are You Prepared for the New DEI Clause?

The July 24, 2026 deadline for incorporating FAR clause 52.222-90 into existing federal contracts is quickly approaching. While implementation and legal challenges surrounding the clause continue to evolve, contractors should prepare for and understand the new requirements.

Effective April 24, 2026, the FAR Council directed federal agencies to include FAR 52.222-90, Representation Regarding Certain Diversity, Equity, and Inclusion Practices, in all new solicitations and resulting contracts. Agencies are also required to modify existing contracts to incorporate the clause no later than July 24, 2026.

The clause implements Executive Order 14398, Addressing DEI Discrimination by Federal Contractors, and includes the following key provisions:

Requires contractors to:
- Certify that they do not operate programs that engage in unlawful racial discrimination.
- Provide full access to books, records, accounts, and other information required by the contracting agency “for purposes of ascertaining compliance with this clause.”
- Report subcontractor violations that are “known or reasonably knowable.”
Makes that certification material to payment under the False Claims Act.
Provides a basis for suspension or debarment in cases of noncompliance.

To help members better understand the new requirements, the Coalition recently hosted a webinar examining FAR 52.222-90 and its implementation. Members may also find additional analysis in a recent Legal Corner article by Miller & Chevalier LLP addressing the Executive Order and related developments.

Resources:

VA Requests Industry Input on Expansion of AI tools within the Agency

FedScoop reports that the VA issued a request for information seeking industry input on new artificial intelligence (AI) capabilities. The initiative would expand AI access across the VA workforce, enabling assistive, collaborative, and agentic AI applications to help deliver faster, higher-quality, and more cost-effective services for veterans. To ensure responsible implementation, the VA is exploring AI literacy and safety tools, along with the potential addition of AI engineers and data scientists to support the management and scaling of AI operations across the agency.

The RFI also provided an update on the VA’s current AI adoption efforts. Since launching last year, VA GPT, the agency’s in-house generative AI tool developed with Microsoft, has surpassed 95,000 users and now supports more than 5,500 daily users. The VA reported positive healthcare outcomes from AI-enabled tools, including a 22% reduction in mortality associated with an AI-assisted clinical decision support tool and a 21% increase in adenoma detection using AI-powered colonoscopy devices.

The VA continues to evaluate additional AI tools for enterprise-wide deployment and is seeking industry feedback on its plans, with responses to the RFI due June 9.

New Executive Order on Advanced AI

On Monday, the President released an Executive Order (EO) titled Promoting Advanced Artificial Intelligence Innovation and Security. The EO establishes a voluntary framework for companies to provide new AI models to the federal government for testing before release. Under the Framework participating firms can provide the Federal government frontier models 30 days in advance and Federal testing would be subject to “confidentiality, cybersecurity, insider-risk, and intellectual-property protection, use, and nondisclosure requirements.”

The EO also tasks the Attorney General with prioritizing the enforcement of identity theft and fraud, computer fraud and abuse, wire fraud and all other applicable Federal criminal laws against anyone who utilizes AI to illegally access or damage a computer without authorization, or who utilizes AI while engaged in such illegal access to further any other crime. This includes breaching any public or private information technology system, or employing AI agents to unlawfully access data or information that is subsequently used for criminal or unlawful purpose.

The Impacts of Workforce Reductions at DoW

MeriTalk reports that the Government Accountability Office (GAO) has issued a report examining civilian workforce reductions at the Department of War (DOW). GAO found that the DoW lacked a consistent approach to assessing the effects of the workforce reductions which limited its ability to evaluate the impacts and guide future workforce planning.

In 2025, the DoW reduced its civilian workforce by more than 78,000 employees (approximately 10% of its workforce), exceeding its target reduction of 5% to 8% under President Trump’s Department of Government Efficiency Workforce Optimization Initiative. The reductions resulted from a combination of routine budgeting and programming decisions, as well as initiatives such as the Deferred Resignation Program, which approved approximately 53,200 applications. In addition, a hiring freeze led to roughly 59,500 fewer civilian hires than in previous years. DoW officials cited organizational streamlining as a benefit of the workforce cuts but also reported increased strain on the remaining workforce. GAO found that assessments of these impacts were conducted inconsistently across the department, with supporting documentation often incomplete due in part to a lack of department-wide guidance.

Looking ahead, GAO identified additional civilian workforce reductions in the DoW’s FY 2026 budget request and recommended that the DoW establish a formal process to consistently evaluate ongoing and future workforce reduction initiatives, informed by lessons learned. The DoW agreed with the recommendation.

Proposed NDA for Federal Employees to Cover Procurement

The Office of Personnel Management (OPM) is proposing to develop a nondisclosure agreement (NDA) for Federal employees. According to the OPM’s notice in the Federal Register, the NDA “is intended to document Federal employees’ acknowledgment of, and agreement to comply with, current legal obligations to safeguard non-public, confidential, or proprietary information, created or obtained through their official duties, while expressly preserving the right to make disclosures authorized by law.” OPM defines “confidential government information” for the NDA as:

“all non-public, confidential, or proprietary information, to include, but not be limited to, information relating to internal agency operations, personnel matters, procurement processes, or any sensitive, pre-decisional or deliberative material that is not currently publicly available and should not be disclosed under applicable law.”

The draft NDA template is posted for review here. OPM is accepting public comments on the proposed NDA within the next 30 days. They are especially interested in input from the public on the following:

What scope of information should be covered by the NDA? Should it cover only unclassified information? How do you understand the terms confidential and confidentiality in the context of this NDA? What customization of the NDA, if any, may be necessary for agencies to ensure it covers the appropriate information?
Does the NDA clearly communicate the types of information that would be subject to non-disclosure requirements? If not, how could OPM better describe what information can or cannot be disclosed to ensure employees have appropriate notice of their responsibilities?
Are there other statutes to which OPM should cite in Appendix A of the NDA when describing the nondisclosure requirements applicable to individuals working for or on behalf of the Federal government?
Do you have suggestions regarding the layout or formatting of the NDA?
Does the Privacy Act statement in the NDA provide sufficient notice to employees of the authorities, principal purposes, routine uses, and effects of the form?
Does the OPM/GOVT-1 system of records notice provide sufficient notice that the government-wide system of records would maintain records related to the signing of, or failure to sign, the NDA?
What are the appropriate actions, if any, for agencies to consider taking if existing employees choose not to sign the NDA?
What are the appropriate actions, if any, for agencies to consider taking if new employees choose not to sign the NDA?
Does the NDA clearly communicate the potential consequences of refusal to sign the form for both existing and new employees, along with whether signing the form is voluntary or mandatory?
What else should OPM consider with regard to the NDA??

The Coalition is interested in whether member companies would like us to submit comments to OPM on the draft NDA. Please send your feedback on whether the Coalition should submit comments, or any of the above questions, to Greg Waldron at gwaldron@thecgp.org.

Legal Corner – New DFARS Proposed Rule: What Defense Contractors Need to Know About Foreign Ownership, Control, or Influence (FOCI) Reporting Requirements

Authored by Anne Bluth Perry, Nikole Snyder, and Robert Mobley; Sheppard

On May 7, 2026, the Department of Defense (“DoD”) issued a new proposed rule—Defense Federal Acquisition Regulation Supplement: Mitigating Risks Related to Foreign Ownership, Control, or Influence (“DFARS Case 2021-D011”)—seeking to amend the DFARS to mitigate risks related to beneficial ownership or foreign ownership, control, or influence (“FOCI”) (the “Proposed Rule”). For defense contractors and subcontractors, the Proposed Rule further implements disclosure obligations, eligibility requirements, and contract performance responsibilities relating to all manner of foreign investment.

New Requirements:

The Proposed Rule introduces a series of structural changes to the DFARS regulatory framework that will directly affect “covered” contractors and subcontractors. “Covered” contractors and subcontractors are “existing or prospective contractors or subcontractors, at any tier, of the DoD with a contract or subcontract valued above $5 million.” By introducing this rule, DoD aims to amend the DFARS by creating Part 240, Information Security and Supply Chain Security, within which DoD proposes to create section 240.27X, Mitigation of Risks Related to Beneficial Ownership or Foreign Ownership, Control, or Influence.[1]

Solicitation Provision

The Proposed Rule will require a new solicitation provision, DFARS 252.240-70XX, Disclosure of Beneficial Ownership or Foreign Ownership, Control, or Influence — Representation, which will require offerors to complete a Standard Form (“SF”) 328, Certificate Pertaining to Foreign Interests, and provide supporting documents for Defense Counterintelligence and Security Agency (“DCSA”) review in the National Industrial Security System (“NISS”). These obligations had typically been confined to contractors seeking or holding a facility clearance. Now, such obligations have been expanded to capture all contractors who currently possess or are competing for a contract or subcontract above $5 million—and in some circumstances, even includes contractors selling purely commercial products and services. This provision also puts offerors on notice that if the requiring activity determines, based on input from DCSA, that FOCI or beneficial ownership poses a risk or potential risk of compromise to national security that may be mitigated, the offeror must agree at the time of award to implement a risk mitigation strategy within 90 days of award. By submitting its offer, the offeror must represent that it has submitted the SF 328 and the contact information of each beneficial owner[2] in NISS, and that the information is current, accurate, and complete.

Contract Clause

Additionally, a new contract clause, DFARS 252.240-70YY, Disclosure of Beneficial Ownership or Foreign Ownership, Control, or Influence, requires contractors to: (1) disclose to DCSA their beneficial ownership and whether they are under FOCI by submitting an updated SF 328 in NISS; and (2) update the SF 328 and supporting documents, including the contact information of each beneficial owner in NISS.

The clause further imposes important downstream obligations:

Contractors must implement risk mitigation strategies within 90 calendar days of contract award, option exercise, modification, or the identification of risks during contract performance.
Contractors must ensure all subcontractors awarded subcontracts exceeding $5 million have an eligible status in NISS prior to subcontract award and maintain that eligible status for the duration of subcontract performance.
If the contractor has any changes in FOCI or beneficial ownership during performance of the contract, or if the contractor is notified of such by a subcontractor at any tier or supplier, the contractor must report the changes by submitting an updated SF 328 in NISS.

DFARS 252.240-70YY also establishes tight timeframes for mid-performance reporting:

Within 3 business days from the date of identification or notification of a change that may place the contractor or subcontractor under FOCI, the contractor must report the foreign owner’s or beneficial owner’s name, relevant information about that person, and any readily available information about risk mitigation actions undertaken or recommended.
Within 10 business days of being notified by DCSA that FOCI or beneficial ownership poses a risk or potential risk of compromise to national security, the contractor must initiate a plan of action to implement DCSA’s recommendations, submit additional information, describe any risk mitigation efforts undertaken to date, and confirm in NISS that it will comply with the identified risk mitigation recommendations.

The new procedures direct government contracting officers not to award or modify a contract, or exercise an option unless the offeror or contractor has a status of eligible in the NISS, available at https://niss.dcsa.mil/.

Practical Impacts:

For those contractors who hold facility clearances, the requirement to complete and update the SF 328 already generally applies. But for contractors who have not sought or obtained a facility clearance, this will likely be a new process, and one that is fairly complicated.

Of course, there are aspects of the Proposed Rule that seem to exceed the existing obligations even on companies with facility clearances. For example, under the Proposed Rule, contractors are required to update the SF 328 when there are “any changes in FOCI or beneficial ownership” and must certify that the SF 328 is “current, accurate, and complete” on the date proposals are submitted. There is no limitation on what constitutes a “change” that must be reported. For example, it is not limited to “material” changes.

Further, for companies not currently under FOCI mitigation, the risk mitigation strategies have to be implemented within 90 days of contract award, contract modification, or option exercise. Typically, such risk mitigation plans are proposed by contractors and approved by DCSA in advance of implementation. This process often takes multiple months itself, so it is unclear whether contractors can comply with the 90-day obligation, unless DCSA approval of the risk mitigation plan is quickly forthcoming upon the identification of FOCI—a timeline and internal government process over which contractors have no control.

Commercial Products and Services Providers

The Proposed Rule does not automatically apply to commercial products and services, unless the designated senior DoD official[3] determines that the contract involves a risk or potential risk to national security or potential compromise because of sensitive data, systems, or processes. However, contractors should not read this exemption as a safe harbor as it is currently unknown what criteria will be used to determine whether the contract involves a risk or potential risk to national security because of sensitive data, systems, or processes.

Flowdown Requirements

Finally, prime contractors must insert the substance of the new clause, including the flow-down obligation itself, in subcontracts and other contractual instruments that exceed $5 million. This means prime contractors will bear responsibility for ensuring that their entire supply chain is compliant, representing a significant new supply chain management burden and one that could cause significant performance delays.

Timeline of Changes:

Milestone	Date / Timeframe
Proposed Rule Published in Federal Register	May 7, 2026
Public Comment Period Closes	July 6, 2026 [4]
Final Rule (anticipated)	To be determined following public comment review

Key Takeaways for Defense Contractors:

Entities that hold or intend to pursue DoD contracts valued above $5 million should begin assessing NISS eligibility status, reviewing beneficial ownership and FOCI disclosure posture, and evaluating their supply chain for subcontractor compliance obligations. Engaging experienced government contracts counsel during the comment period is also advisable to ensure your organization’s interests are properly represented.

*Robert Mobley is a law clerk in the firm’s Washington, D.C. office.

FOOTNOTES

[1] This will implement paragraphs (b)(2)(A), (b)(2)(C), and (c)(1) of section 847 of the NDAA for FY 2020, paragraph (c)(2) of section 819 of the NDAA for FY 2021, and elements of DoD Instruction 5205.87.

[2] “Beneficial Owner” is defined in 17 C.F.R. 240.13d-3, and includes “any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (1) Voting power which includes the power to vote, or to direct the voting of, such security; and/or, (2) Investment power which includes the power to dispose, or to direct the disposition of, such security.”

[3] The Proposed Rule states, “The term ‘designated senior DoD official’ is used in this proposed rule as a placeholder.”

[4] Comments on the proposed rule must be submitted in writing on or before July 6, 2026, to be considered in the formation of a final rule.

Off the Shelf: Key Trends in Government Contracts Compliance

Alex Canizares, partner at Vinson & Elkins and co-head of the firm’s Government Contracts Practice Group, joins Off the Shelf to share insights on current developments in government contracts compliance.

Canizares discusses several Department of Justice (DOJ) initiatives, including Civil False Claims Act enforcement priorities, and provides a brief overview of the Act’s statutory language and general structure, as well as the DOJ’s newly established Fraud Enforcement Division.

Additionally, Canizares examines new DEI clause requirements and related enforcement developments.

Listen to the full interview here.