CMMC Level 3 Certification Planning for Defense Contractors

Who Needs Level 3

The Department of Defense says less than 1% of defense contractors need CMMC level 3 certification. This highest level applies to the most critical programs where CUI loss could harm national security badly.

Three situations trigger Level 3. First, breakthrough or advanced technology work. Second, large amounts of CUI in one system. Third, single point of failure where breach affects many programs.

Examples include weapons development, classified R&D, intelligence systems, and secure communications. Large primes handle most Level 3 work. Smaller firms may need it for sensitive missions.

Each defense contract states the required CMMC level. Contract officers decide based on CUI type and program needs. Contractors on critical programs must budget for Level 3 to keep doing business.

The 24 Enhanced Controls

CMMC level 3 requirements add 24 controls from NIST SP 800-172 to the 110 Level 2 controls. These defend against advanced persistent threat actors with nation-state skills.

The controls focus on three goals. Make systems harder to breach. Limit damage when breaches happen. Keep missions running during attacks.

Key operations need to include a 24/7 Security Operations Center watching for threats all day and night. You must have a Cyber Incident Response Team ready to deploy anywhere within 24 hours. Threat hunting must happen regularly to find hidden attackers.

Risk management requires threat-based assessments using intel from many sources. Security tools need proof they work against known attack methods. Supply chain risk plans become required with formal response steps.

Technical controls require separating critical systems physically or logically. Annual penetration tests must check defenses. Automated systems must find and isolate rogue devices. All controls target nation-state actor tactics protecting cui.

Seven of these 24 controls are considered especially critical for Level 3 certification. These include SOC, incident response team, threat-based risk review, security tool proof, supply chain risk response and plan, and special asset protection. Organizations should prioritize implementing these controls first.

DIBCAC Government Assessment

The defense industrial base cybersecurity assessment center DIBCAC runs all Level 3 reviews. DIBCAC works under the Defense Contract Management Agency. Government staff who know nation-state threats do the work, not private assessors.

You must finish Final Level 2 first from a C3PAO for the same scope. All Level 2 POA&Ms must close with a perfect 110 SPRS score before asking for Level 3. You cannot skip Level 2 or do both at once.

DIBCAC checks all 134 controls by reading documents, talking to staff, and testing how things work. Staff often visit sites and watch people do security tasks on live systems. This proves controls work in real life, not just on paper.

Organizations must meet all 134 required controls to achieve Level 3 certification. The assessment is pass/fail based on demonstrating full implementation of all enhanced security requirements. Organizations should prepare thoroughly before requesting DIBCAC assessment to ensure all controls are fully operational.

DIBCAC reviews happen every 3 years with annual checks between. This government process creates official records affecting defense contract access.

Costs and Timeline

The CMMC 2.0 rollout follows a confirmed four-phase schedule:

• Phase 1 started November 10, 2025 with self-checks.
• Phase 2 starts November 10, 2026 requiring C3PAO proof for Level 2.
  
• Phase 3 begins November 10, 2027 when Level 3 DIBCAC reviews become required in applicable requests.
• Full launch finishes Phase 4 in November 2028.

This gives time to plan. Firms needing Level 3 for 2027 contracts must start prep now. The work takes 18 to 24 months from first gap check through DIBCAC approval if Level 2 is done.

Setup costs vary greatly by firm size. DoD estimates small contractors face $2.7 million in first-time setup costs for the enhanced Level 3 controls. Large prime contractors (the main Level 3 audience) face significantly higher investments. DoD estimates large entities will spend $21.1 million in setup costs for implementing the 24 enhanced security controls from NIST SP 800-172.

Big cost items include 24/7 SOC setup and staff, threat intel feeds, advanced detection tools, network separation work, and consultant help. Annual costs also scale with size. Small contractors spend roughly $490,000 yearly for upkeep. Large primes should budget $4.12 million annually for maintenance, system watching, and staying ready.

Three-year renewal requires another DIBCAC review, which the government conducts free of charge. However, firms should budget $36,000 to $39,000 for internal prep work, staff time during assessment, evidence gathering, and reporting activities tied to the review cycle. Annual affirmations between reviews add roughly $2,700 for large firms.

The work compares to FedRAMP High approval in scope and demands. Both need government reviews, constant watching, and major operations skills. Level 3 focuses on protecting cui against APTs rather than full federal cloud approval.

Next Steps

First check if your contracts need Level 3. Look at your defense work for critical programs, breakthrough technology, or large CUI amounts. Talk with program managers and contract officers about future needs.

If Level 3 applies, run a gap check against the 24 NIST SP 800-172 controls now. Focus on implementing all controls fully, as Level 3 certification requires demonstrating complete compliance. Budget extra time for the most complex controls.

Check your Level 2 status. If not done yet, finish Final Level 2 first. This gates your ability to request Level 3 review.

Build a multi-year budget covering first setup, yearly work, and three-year renewal. Show this to executives and board as strategic spend protecting critical revenue, not optional compliance cost.

Get expert help from consultants who know DIBCAC reviews and prime contractor work. Government process differs greatly from commercial C3PAO audits. Expert help prevents costly errors during high-stakes review.

Plan to finish by early 2027. This positions your firm for Phase 3 contracts and avoids the rush when rules become universal. Early work shows security leadership to DoD customers and creates edge over slower competitors.

Level 3 is not one-time work but ongoing operations. Build lasting programs that keep you ready across three-year cycles while critical defense work continues.

If your firm needs Level 3 readiness help, explore our consulting for prime defense contractors. We help security leaders at major contractors handle DIBCAC needs, implement enhanced controls, and achieve approval efficiently.

For official guidance, see the CMMC Level 3 Assessment Guide and DoD CMMC info.