ITN for Group Term Life Insurance ITN No.: DMS 14/ Response to Vendor Questions

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1 Timeline of Events- Why does contract start date say 3/20/15 in the timeline and not 1/1/16? Timeline of Events- Can an extension be provided due to the amount of missing information and timeline that falls over the holidays? 3 Attachment J n/a - First Tab/Current Premiums- On the experience report, there are 3 retiree rates provided. There is one for the $2500 benefit and one for the $10,000. What is the third rate of $2.965/$1000 for? 4 Attachment J n/a Please provide a listing of all open waiver claims with the following information: o Line of coverage (basic or supplemental) o Gender o Date of birth o Date of loss o Certificate amount 5 Attachment J n/a Please confirm the rates provided have been the same since 1/1/08. If not, please provide rate history by line of coverage for all years. The contract start date is the Department s anticipated date of contract execution. The contract refers to this date as the Implementation Date. As stated in the contract, the Effective Date is January 1, See Addendum 1, Updated Timeline of Events. The $2.95/$1,000 number is the price per $1,000 benefit. See Attachment M: Open Waiver Claims. Information that was requested but is not provided is unavailable. For premium rates between 2008 and 2010, see Amendment 1 to the current contract under the Documents tab athttp:// The premiums provided in Amendment 2 have been in place since The Department has recently learned of a scrivener s error affecting the numbering of the amendments. However, the links to the documents correctly reflect the amendment numbering. 1

2 Q. # ITN Section ITN p. # Question Response 6 Attachment J n/a Are the rates for retirees of Yes. $7.41 and $29.65 per month supposed to be per person per month rates? 7 Attachment J n/a Please provide a claim listing by This data is unavailable. year and by line of coverage that includes a claim indicator such as EE name or claim #, Date of Loss, Date Paid, Gender, Amount paid plus interest. 8 Attachment J n/a - Please provide Billing statements are unavailable. Attachment N: Invoice is an example of internal documents generated with each month s payment. a copy of the most recent billing statement. 9 Attachment J n/a Please provide the Basic AD&D The current AD&D rate for basic active, basic retiree and optional life coverages is $ rates for Basic actives and for retirees? Also, please provide the rates for Supplemental AD&D. 10 N/A N/A Please provide a copy of the current contract/booklet. The current contract can be found at: For member certificates and the new hire book see the Minnesota Life website at: 11 N/A N/A Please outline current enrollment and communication process. 12 N/A N/A Assuming employees enroll for coverage online, what online enrollment platform does the State currently utilize? People First, the Department s benefits administrator, includes a service center and secure online enrollment system. Newly hired employees are automatically enrolled in basic life ($25,000 benefit) and have 60 days to enroll in optional life either using the system or by calling the service center. Employees may enroll or change coverage levels during open enrollment or during the year with a qualifying event. People First mails all communications to employees, including the new hire package and the open enrollment package. Retirees may also use the People First system, but typically call the service center to make election changes. The People First system is run on an SAP platform (ECC 6.0, NW 7.0). 2

3 13 N/A N/A Does the State anticipate issuing Please refer to the response to question 2. an addendum to extend the due date for this ITN? 14 N/A N/A How does the State currently communicate to employees through an intranet site, through direct mail, etc.? Is it the State s intention to keep the same communication method 15 Contract Section Indemnification 16 Section 3.7 Order of Preference & Contract Section 1.3 Hierarchy of Documents 17 Section 2.14 Subcontracting 18 Section 2.14 Subcontracting Page 32 Page 19 Page 9 Page 14 Page 14 Is there a way to limit the scope of the indemnity clause to be more closely tailored to the scope and purpose of the contract? Can you clarify that the order of precedence allows that the bidder s group life insurance contract, as approved by the Florida Office of Insurance Regulation, will govern the terms of the insurance relationship, as is required by Florida State law? Can the State provide a schedule, or if not available, approximate number of open enrollment meetings that we will be required to attend? "Can subcontractors be paid a flat fee and/or as a percent of premium? The Department communicates to employees many ways including, but not limited to, direct mail from People First, the People First website, management advisories and the Department s newsletter, The Wellness Wire. The Department does not currently anticipate changing any communication methods. Upon the request of the Department, Respondents will be able to propose changes to the draft contract during the negotiation period. Such changes must be agreed to by the negotiation team and approved by the Department s Office of the General Counsel. The contract between the Department and the Contractor will comply with all applicable state and federal laws. The 2015 open enrollment benefit fair schedule has not been finalized. See Attachment O: 2014 Benefit Fair Schedule for the 2014 benefit fair schedule, provided as an example. The Department does not dictate the relationship between the Contractor and the Contractor s Subcontractors beyond consenting to the Subcontractors to provide Services for this Contract. 3

4 19 Section Performance Qualifications. Page 17 Are there any minimum capitalization and surplus requirements for the bidding life The Contractor must comply with section 624, Florida Statutes. 20 Section Performance Qualifications 21 Section 3.4 Minimum Programmatic Specifications 22 Section 3.4 Minimum Programmatic Specifications 23 Section 3.4 Minimum Programmatic Specifications 24 Section Vendor Attendance at Negotiations Page 17 Page 18 Page 18 Page 18 Page 25 insurer? Are there any minimum financial rating requirements for the bidding life insurer (example, an A rating from A.M. Best)? Does the current EOI process involve a long or short form underwriting? How many questions are on the current EOI form? Can a sample EOI form be provided? Can the State please provide a copy of the negotiation schedule? No. The current evidence of insurability (EOI) process is short form underwriting. The current EOI form may be found at: See the response to question 22. A negotiation schedule has not been created. 4

5 25 Attachment B- 1 Minimum Requirements 26 Attachment B- 3: Design Question 1, vendors are asked to agree unequivocally to all terms and conditions of the ITN, Contract, and all attachments, will there be an opportunity during the bidding and negotiating phase to discuss minor deviations or clarifications? If so, would the State prefer those during the Deadline to submit Replies and all required documents to Procurement Officer phase or would those be a part of the Negotiations conducted phase as outlined on page 7 of the ITN, section 1.6? 8 The AD&D exclusions in the Design Tab do not include the following in the Active Certificate: war, or any act of war, declared or undeclared and service in the military of any nation. Please confirm these are exclusions. Upon the request of the Department, Respondents will be able to propose changes to the ITN documents (i.e., the contract, performance guarantees, minimum service requirements) during the negotiation period. Such changes must be agreed to by the negotiation team and approved by the Department s Office of the General Counsel. Confirmed. See Attachment B: Revised Technical Reply. 5

6 27 Attachment B- 3: Design N/A 28 Attachment B- 3: Design N/A The active certificate includes a portability supplement that is not reflected in the plan design. Please confirm whether the ports are in the paid claims, and if the ports will stay with the existing carrier. If ports are included in the experience, please confirm the current port rates and conditions required to elect portability. The full active certificate has the following wording: A retiree who returns to active work can be covered as a retiree or as an active employee, but not both. The exception is a retired State Senator or Representative who returns to work as a Class 1 or Class 2 position; such person can be covered as a retired Senator/Representative and an active employee at the same time. How many individuals do you estimate have coverage as an active and retired participant? The paid claims experience does not include ported coverage. Individuals who have ported coverage under the current plan may continue coverage with Minnesota Life after the State s group policy with Minnesota Life terminates. Currently, five (5) individuals are enrolled in both active and vested legislator coverage. 29 Attachment C Financial Reply N/A Does the State want the rates for the basic and supplemental coverage to each be selfsupporting? Beyond the requirements listed in Attachment B-3: Revised Design or any specific instructions found in the ITN, the Department does not prescribe how rates should be calculated for this ITN. 6

7 30 Attachment C- 2: Financial Reply 1 In the retiree certificate there is an extended benefit, which is not reflected in the Financial Reply. Please confirm if this benefit should be included in the proposed plan design, if so please provide a detailed listing of the totally disabled Not confirmed. See the response to question 4 for open waiver claims. 31 Attachment C- 3: Financial Reply 32 Attachment C-3 and 4: Financial Reply 33 Attachment C- 2-4: Financial Reply individuals. 1 The premium calculated using the optional life volume in the Financial Reply does not reconcile with the 2013 experience premium (i.e. $20M versus $15.9M). Please explain this discrepancy. N/A N/A Portability is part of the active certificate for optional life; please confirm if portability is requested for the proposed optional or dependent life plans or both? For renewal years 5 through 8 is a rate per 1,000 required to be in compliance with the contract or can the rates for the renewal terms be dictated after the initial term is agreed upon? The volumes provided in Attachment C: Revised Financial Reply are from the current census. The current census contains data from October Portability is required for optional life coverage. See Attachment B: Revised Technical Reply. Renewal rates must be provided in the initial Reply as described in Attachment C: Revised Financial Reply. 7

8 34 Attachment J: Current Premiums 35 Attachment J: Current Premiums 36 Attachment J: 37 Attachment J: 38 Attachment J: 39 Attachment J: 1 Please provide rate history for 2008 through 2014, which separates the life and AD&D rates by Active, Retired, OPS, and Vested Legislators. 1 Please provide the most recent billing statement. 1-2 Please separate the combined experience from 2008 through 2010 by plan year along with providing 2014 experience. 1-2 Do claims incurred include change in reserves (pending, waiver of premium), interest, and conversion/portability charges? If so please break out the components by plan year. 1-2 Is a detailed claim listing for claims paid and pending available including gender, date of birth, date incurred/reported, date paid, status and amount paid? 1-2 Is it possible to separate the Active Employer Paid (salaried) basic life experience from the Active Employee Paid (hourly/ops) basic life experience? See the response to question 5 for rates from 2008 through The current rates have been in place since Please see the response to question 9 for separated AD&D rates between 2011 and OPS employees became eligible for coverage in Additional information is unavailable. See the response to question 8. See Attachment J: Revised. Incurred claims include paid claims, interest, current pending claims, current reported waiver reserve, current waiver IBNR reserve and conversion charges. Additional data is unavailable. This information is unavailable. See Attachment J: Revised. 8

9 Q. # ITN Section ITN p. # Question Response 40 Attachment J: 1-2 Please provide an open and closed claim list of disabled with face and reserve amount, date disabled, date approved, and date closed. See the response to question Attachment J: 42 Attachment J: 43 Attachment J: Page 8, Attachment G Page 4, Attachment J Page 4, Attachment J 1-2 Please provide any plan changes over the experience period (i.e. there is a large decrease in basic life premium 1/1/11 and an increase in optional life premium 1/1/11). 1-2 Can the experience for the vested Legislature be separated out? Is this experience reflected in both active and retiree basic life experience? 1-2 Are average lives and volume by plan year available by coverage? Provide full census that is broken out by employees and retirees. Census needs to include all elections and volumes. Provide Inforce booklet and contract Provide experience exhibits on inforce Carrier letterhead and their current system reports. See for the amendments to the contract, which detail the plan changes. The Department has recently learned of a scrivener s error affecting the numbering of the amendments. However, the links to the documents correctly reflect the amendment numbering. Vested legislator experience is unavailable on its own. This experience is reflected in both the active and retiree life experience depending on the employment status of the Legislator. Average volume by year is unavailable. The following is the average yearly enrollment: Basic Active Basic Retiree Optional Section 1.8 of the ITN provides instructions about obtaining the census file to be eligible to submit a Reply for this procurement and the data contained therein. Other information is unavailable. See the response to question 10. The Department is unable to provide this information. 9

10 Page 4, Provide rate history for the past See the response to question 5. Attachment J 5 years broken out by base, supp Page 4, Attachment J Page 4, Attachment J Page 4, Attachment J Page 4, Attachment J Page 4, Attachment J and retiree. Provide total lives history for past 5 years broken out by month for the base, supp and retiree. Provide total volume history for past 5 years broken out by month for the base, supp and retiree. Provide Waiver of Premium claims report to include (Name, DOB, Date of Hire, Gender, Volume and Diagnosis) Please provide any plan changes over the past 5 years? If so what were they and when were they implemented? Provide new renewal pricing package from current inforce carrier Page 5 Provide inforce commission level currently in place Page 5 Provide name and location of the current inforce broker on the plan. How many years has this broker been servicing the inforce entity? See the response to question 43. Additional information is unavailable. This information is unavailable. See the response to question 4. See the response to question 41. The contract with the current carrier ends Dec. 31, The current rates have been provided. No other payment is made through the current contract. There is no current broker. 10

11 55 Section The ITN indicates that the See the response to question 2. deadline to submit replies is Friday, December 26, 2014 at 3:00 pm. We have received notification that the State offices will be closed on Friday, December 26. Can you please provide the revised due date? 56 Attachment A Draft Contract Section 7.2 Attachment A Page 22 We understand that a performance bond will be required of the awarded contractor and shall not be less than $500,000. Can you please provide the amount of performance bond that will be required by the Department of The performance bond will be for $500, Attachment A Draft Contract Section Attachment A Draft Contract Section 3.3 Attachment A Page 11 Attachment A Page 17 the selected Contractor? There is a requirement that the Contractor retain records, papers, and documents in compliance with the Record Retention Schedules published by the State. Please provide copies of the State s Record Retention Schedules. Please provide additional details of what the acceptance review entails and when this review would be performed. See the following website: The Department s Acceptance review is a standard and continual part of monitoring the Contract to ensure the Services meet the requirements established in the Contract 11

12 Q. # ITN Section ITN p. # Question Response 59 Attachment B - Technical Reply Tab B-3 Pages 7-8 The current contract has no exclusions for life insurance. ITN states the following life exclusions 1) Intentionally selfinflicted injury whether sane or insane 2) Suicide or attempted suicide, whether sane or insane 3) Commission of, participation in, or attempt to commit a crime, assault, felony or other illegal activity. Conviction of an illegal act is not necessary for the determination of this exclusion 4) Intoxication by way of alcohol and/or drugs (legal and illegal) unless taken as directed by the insured s licensed physician in a verifiable prescribed manner and dosage. Please confirm the State wishes to add these exclusions? Confirmed. 60 Attachment B - Technical Reply Tab B-3 Page 6 The current contract has an AD&D benefit for One hand and sight of one eye 100%. ITN does not include this as a benefit in the AD&D table. Please clarify if this should be included? Confirmed. See Attachment B: Revised Technical Reply. 12

13 61 Attachment B - Technical Reply Tab B-3 Page 6 The current contract states that if you become totally disabled at age 60 or older your insurance will continue one year from the date of onset of your total disability. ITN does not mention this provision. Please clarify if it Yes. See Attachment B: Revised Technical Reply. 62 Attachment B - Technical Reply Tab B-3 63 Attachment B - Technical Reply Tab B-3 Page 8 Page 4 should be included? The current contract has AD&D exclusions to include 1)travel in or descent from any aircraft, except as a fare-paying passenger on a regularly scheduled commercial flight on a licensed passenger aircraft carrier 2) War or any act of war, whether declared or undeclared 3) Service in the military of any nation. ITN does not include these exclusions. Please confirm that these are to remain in the contract? Spouse coverage is stated to be guaranteed issue. Is this for initial eligibility and family status change? As with employees, please confirm that late entrants would be required to provide EOI for spouse coverage. Confirmed. See Attachment B: Revised Technical Reply. Spouse coverage is guaranteed issue during the spouse s initial eligibility period and for qualifying status change events that result in initial eligibility for the spouse (e.g., marriage). A spouse that is a late entrant may be required to provide EOI. Spouses that enroll during the 2015 open enrollment period are not considered late entrants. See the Attachment B: Revised Technical Reply. 13

14 64 Attachment B - Technical Reply Tab B-3 Page 4-5 Child coverage is stated to be guaranteed issue. Is this for initial eligibility, annual enrollment, and family status Child coverage is guaranteed issue regardless of when the child is added. 65 Attachment B - Technical Reply Tab B-3 66 Attachment B Technical Reply - Tab B-6 67 General Question 68 General Question Page 4-5 Page 7 N/A N/A change? Please clarify that OPS class is not eligible for spouse/dependent coverage? With regard to timeliness of reports, we understand monthly reports are due within 10 calendar days and quarterly reports are due within 45 calendar days. Please clarify the timing of the delivery of the annual performance reporting which ends on 12/31. Is there reason other than standard public bids requirement for the marketing of State of Florida s group term life plan? Who is the current carrier and how long have they held the contract? Please provide further details around the required performance bond and required amount. This coverage is available for OPS employees enrolled in basic life coverage. Annual reports listed under the Annual Reports header on MSR-23 on Attachment B-4: Minimum Service Requirements are due on December 31 of each year. Quarterly reports (or an annual report that includes the fourth quarter of the year) are due within 45 Calendar Days of the end of the quarter. No. Minnesota Life has been the life insurance carrier since See the response to question

15 Q. # ITN Section ITN p. # Question Response 70 Attachment J: 1 & 2 ( What does incurred claims represent in the Attachment J? Are waiver reserves or other claims included See the response to question Attachment J: 72 Attachment J: 73 Attachment J: 74 Attachment J: 75 Attachment J: 76 Attachment J: 1 & 2 ( 1 (Current Premiums 1 (Current Premiums 1 & 2 ( 1 & 2 ( 1 & 2 ( here? Please explain/advise. The shows a 25% change to (total) premium in Basic premium fell by more than 50% and Supplemental premium increased. What changes occurred here to cause this? Please explain. How long have current rates been in-force? See the response to question 41. The current rates have been in force since Please provide rate history. See the response to question 5. Please separate out premium and incurred claims by year for years for Active vs. Retiree. Please provide Dependent Life claims experience. Please provide Individual claims listing for data going back to See the response to question 36. Dependents are not covered in the current plan design. This information is unavailable. 15

16 Q. # ITN Section ITN p. # Question Response 77 Attachment J: 1 & 2 ( Please provide a detailed waiver listing with Date of Birth, Gender, Date of Disability and See the response to question Attachment J: 79 Attachment J: 80 General Question 81 Attachment B- 3: Technical Reply 82 General Question 83 General Question 84 Attachment B- 3: Technical Reply 85 Attachment J: 1 & 2 ( 1 & 2 ( N/A 1-8 ( Design N/A N/A 1-8 ( Design 1 (Current Premiums Face Amount. Please provide experience detail for 2014 including paid premium and incurred claims. Please provide historic lives and volume reporting. Please provide a current Billing Summary. Please provide complete plan booklets for all classes and coverages. Only the plan designs were mentioned in Attachment B Technical Reply, not the full plan booklets. Have there been any plan changes since the beginning of the experience period? Please provide the plan amendments. Is the Basic Life Waiver of Premium a Lifetime benefit or does it terminate at age 65 like the Supplemental Life? Please provide the dependent life rates. 86 Attachment A All (1-41) Please provide Attachment A in Word format if possible? See the response to question 36. See the response to question 43. See the response to question 8. See the response to question 10. See the response to question 41. See the response to question 41. See Attachment B: Revised Technical Reply to learn when the waiver of premium terminates for each type of benefit. Dependents are not covered in the current plan design. The Department will provide the Contract in Word format at the appropriate point during the negotiation phase. 16

17 Q. # ITN Section ITN p. # Question Response 87 Attachment B- 4: Technical Reply The Department is unclear about what is being asked. 88 Attachment J: 89 The Attachment B: F14562 _ Technical Reply.xls 90 Attachment J: 91 The Attachment B: F14562 _ Technical Reply.xls 1-7 (Minimum Service Requirements Regarding the minimum service requirements tab request as part of the Custom Service expectations, is the expectation that the State of Florida will be SA billed but the administration will rely fully on the chosen vendor? Please advise. 1-2 Can you provide additional Premiums and Incurred claims for the plan year to current date? Design Reference to {2. Waiver of Premium} under the Design tab, however no Waiver of Premium Claims have been provided. Can you provide open Waiver of Premium claims for Basic and Optional life from the current provider. 1-2 During the plan years, have there been any rate changes? If so, can you offer insight as to (i) What rates changed and (ii) When those rate changes came into effective? Design During the plan years, have there been any rate changes? If so, can you offer insight as to (i) What rates changed and (ii) When those rate changes came into effective? See the response to question 36. See the response to question 4. See the response to question 5. See the response to question 5. 17

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19 Timeline of Events 7 Has the agency considered extending the timeline for submission of Replies to the ITN until after January 1, 2015, to allow for the impact of the Dec. 25 state holiday (and for many companies Dec. 25 & 26) on the following: There are only 3 business days between the posting of answers to vendors questions on Dec. 22 and the Reply submission deadline of Dec. 26. In the prior procurement in 2007 for Group Term Life, there were 40 days total from when the ITN solicitation was released until Reply proposals were due. In ITN No. DMS14/15-025, there are only 18 days total afforded between posting of the ITN to the Reply due date, with the several religious holidays included in those 18 days. Within that 18 days, we are also concerned that there is not adequate time for insurers to price the response and submit questions, given the mechanics required to execute the Confidentiality Agreement/NDA then download and review the Census. That does not leave proposers much time to formulate questions by 12/15, review See the response to question 2. 19

20 answers on 12/22, and then submit proposals on 12/26. Practically speaking, Replies would likely have to be shipped by 12/23, which falls during the peak holiday shipping season. During the 2013 holiday season, several express shipping companies were unable to honor their overnight shipping commitments due to weather and other factors. Given that hard copies and CDs must be submitted as part of Reply, and that there is no provision for submitting a response electronically, many responders will need to ship their Replies and could encounter holiday, weather-related and other delays. A proposal due date of January 7, 2015 would be more practical, allowing for various holidays through New Year s Day, resulting in only minimal delay of the overall timetable. MetLife is very interested in submitting a bid and believes that a slightly longer timeline would result in a more competitive procurement, thus allowing more parties to submit well-developed proposals. 20