GENESEE HEALTH SYSTEM REQUEST FOR QUOTE ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS

GENESEE HEALTH SYSTEM REQUEST FOR QUOTE ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS PUBLIC NOTICE: APRIL 17, 2016 REISSUED: MAY 3, 2016 TABLE OF CONTENTS I. PURPOSE AND SPECIFICATIONS II. III. IV. OFFEROR CRITERIA AND RESPONSE REQUIREMENTS OFFEROR COVER SHEET TIMELINE 1

I. PURPOSE AND SPECIFICATIONS Genesee Health System (hereinafter referred to as the Board ) is seeking sealed Quotes from interested, qualified and experienced parties in providing ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS. The ideal candidate will possess the depth of knowledge it takes to deliver the services described herein. These services will be provided at locations as requested by the Board. Quotes must be clear, concise, typewritten, and must be signed in ink by the official authorized to bind the submitter to its provisions. The contents of this Request for Quote (RFQ) will become incorporated within any contract signed by the Board and the provider of service. Do not retype this RFQ, instead, respond on a separate page and cite the section number for each response. All areas of the bid Quote must be addressed in the same sequence cited in the RFQ instructions in order that proper consideration is given to the Quote. Quotes submitted without information or incomplete content will result in the Quote being removed from consideration. The Offeror must complete an Offeror Cover Sheet and attach to the Quote. Offerors are to use their expertise to meet or exceed the Board s needs and earn its trust. Offerors MUST indicate their Intent to Bid by sending an e-mail as such to RFQreplies@genhs.org by 3:00 PM Thursday, May 5, 2016. Questions from qualified parties may be submitted via an e-mail sent to RFQreplies@genhs.org. No phone calls will be accepted. Questions will be accepted up until Thursday, May 5, 2016 at 3:00 P.M.. A Question & Answer (Q & A) document will be posted on the www.genhs.org website and may be found by following the link to RFQ Opportunities. The Q & A is anticipated to be posted Monday, May 9, 2016 by 12:00 P.M. NOON. Any change to this RFQ subsequent to its release will be confirmed in writing by the Board. One (1) original; five (5) copies; and one (1) searchable electronic version on a USB flash drive of each Quote must be submitted in a sealed envelope/package. Quotes will be accepted until May 13, 2016 at 2:00 P.M. Quotes must be received by this date and time in order for the Quote to be considered. The following should be noted on the outside of the envelope: CONFIDENTIAL RFQ MATERIALS ACTUARY SERVICES (OPEB) VALUATIONS DO NOT OPEN BEFORE MAY 13, 2016 @ 2:30 P.M. EDT [INSERT YOUR COMPANY NAME] Quotes may be mailed or hand delivered to the following address: Genesee Health System Attn: Contract Management 725 Mason Street Flint, MI 48503 Quotes will be publicly opened on May 13, 2016, at 2:30 P.M. ET at 725 Mason Street, Flint, MI 48503. The Quote shall cover products/services beginning on or about June 1, 2016 or as 2

agreed upon by the Contractor and the Board. The product/service will be delivered on or about August 19, 2016 or as agreed upon by the Contractor and the Board. The Board reserves the right to accept or reject any/all Quotes received pursuant to this RFQ, in whole or in part; and/or to waive any/all irregularities therein; and/or to delete/reduce the units of service; and/or to negotiate Quote terms in any way whatsoever to obtain a Quote as deemed in its best interest. The Board reserves the right to re-solicit/re-advertise as deemed necessary. INTRODUCTION AND OVERVIEW The Board received Authority status as of January 1, 2013, becoming a distinct governmental public entity separate from the County of Genesee. Funding for the service(s) described herein is enabled by a cost reimbursement contract with Board Prepaid Inpatient Health Plan to manage the Concurrent 1915(b)(c) Programs, the Healthy Michigan Plan and relevant I waivers in Genesee County, Michigan and to provide a comprehensive array of specialty mental health services and supports as indicated therein. The Board also operates Genesee Community Health Center, which offers a holistic approach to physical health care for those who may otherwise go without. The Board intends to enter into a contract with a for-profit or non-profit entity or entities to provide ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS. It is expected that the Quote to provide these services will be in compliance with all applicable State and Federal standards and guidelines. The Board has chosen to meet the challenge of managed care by managing its mental health care service delivery through evaluation and monitoring, and expecting its service providers to be solely responsible for managing its operations consistent with terms of the accepted contract. Consequently, the Offeror should be aware that providers from whom the Board purchases equipment/services are expected to operate in the marketplace and be able to effectively meet the requirements for establishing and maintaining a contractual relationship with the Board. This RFQ establishes criteria and requirements that have been designed to cover important aspects of the products and services to be provided. COST LIABILITY The Board assumes no responsibility or liability for costs by the Offeror, or any Offeror prior to the execution of a contract between the organization and the Board. OFFEROR RESPONSIBILITIES All inquiries concerning the content of the RFQ shall be submitted to the address cited on page three of the RFQ. 3

It is the responsibility of the Offeror to understand all details of the RFQ. The Offeror, by submitting a response indicates a full understanding of all details and specifications of the RFQ. Offerors are expected to present narrative statements/summaries in a clear, concise and organized manner for review. The Offeror is solely responsible for delivery of one (1) original Quote; five (5) copies; and one (1) searchable electronic version on USB flash drive to the specified address on or before the date and time specified on page three of the RFQ. The Contract Management Office will be the single point of contact throughout the RFQ process. RFQs submitted after the deadline will not be considered and will be discarded. All RFQs submitted by the deadline will become the property of the Board. OTHER MATERIALS Offerors may attach other materials believed to be relevant to illustrating the Offeror s ability to successfully provide these products and services. AWARD OF CONTRACT It is the intent of the Board to enter into a contract with provider(s) that will emphasize administrative efficiencies, and possess the capacity, infrastructure and organizational competence to provide the requirements under this Quote. Award recommendations are contingent upon an initial evaluation of the Offeror s qualifications to determine if the Offeror is a quality provider. There are three types of evaluation that may be used to determine if an Offeror meets quality standards. The first is an evaluation of the written response to the RFQ. The second involves interviewing Offeror s staff and/or regulators. The third involves interviews with Offeror s customers and/or consumers. In addition to access to customers, the evaluation process must be assured of unimpeded access to employees of the Offeror. Requests for additional information, to assist the evaluators, may be submitted to the prospective Offeror in order to facilitate sampling satisfaction. Offerors who are awarded contracts shall not assign or delegate any of their duties or obligations under the contract to any other party without written permission of the Board. DISCLOSURE All information in an Offeror s Quote is subject under the provisions of Public Act No. 442 of 1976 known as the Freedom of Information Act. 4

CONFLICT OF INTEREST Offerors awarded a contract will affirm that no principal, representative, agent, or other acting on behalf of or legally capable of acting on the behalf of the Offeror, is currently an employee of the Board; nor will any such person connected to the Offeror currently be using or privy to any information regarding the Board which may constitute a conflict of interest. At the time of the Quote, all Offerors shall disclose any known direct or indirect financial interests (including but not limited to ownership, investment interests, or any other form of remuneration) that may be present between the Offeror or its potential subcontractors, and Board personnel. This disclosure shall be made to the Boards Chief Administrative Officer who will forward the information to the CEO. As part of the Quote, include a list of any known potential subcontractors, including the portion of work being contracted out to other licensed contractors. This listing of potential subcontractors shall be limited to the name of the company, name of the company s owner(s), and business address. If any other subcontractor is selected after a contract is awarded, the successful Offeror shall provide the Board with the name of the company, its owner(s), and address. This requirement is not intended to apply to minimal relationships such as the purchase of a small dollar amount of supplies to complete a project. RELATIONSHIP OF THE PARTIES (INDEPENDENT CONTRACTOR) The relationship between the Board and any Offerors successful in obtaining a contract is that of client and independent contractor. No agent, employee, or servant of the contractor shall be deemed to be an employee, agent, or servant of the Board for any reason. The independent contractor will be solely and entirely responsible for its acts and the acts of its agents, employees, and servants during the performance of a contract resulting from the RFQ. NO WAIVER OF DEFAULT The failure of the Board to insist upon strict adherence to any term of a contract resulting from this RFQ shall not be considered a waiver or deprive the Board of the right thereafter to insist upon strict adherence to that term, or any other term, of the contract. DISCLAIMER All the information contained within this RFQ reflects the best and most accurate information available to the Board at the time of the RFQ preparation. No inaccuracies in such information shall constitute a basis for legal recovery of damages, either real or punitive. If it becomes necessary to revise any part of this RFQ, a supplement will be issued to all potential Offerors who obtained the original RFQ. 5

Service Description ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS SCOPE OF SERVICES Genesee Health System (GHS) is required to perform Other Post-Employment benefits (OPEB) Valuations biennially under Governmental Accounting Standards Board (GASB). GHS exercises its discretion to complete annual OPEB Valuations for the following reasons: 1. Health Care rate trends have been very volatile in the past years. Each year the health care premium paid for retirees has a great impact on the Annual Required Contribution (ARC). 2. Any change in benefits for OPEB will have an impact on the ARC. The actuarial valuation of OPEB for GHS as of December 31, 2015 encompasses the following three phases. Phase I Review Current Plan Provisions and Most Recent Actuarial Valuation Review and recommend updates of: A. Current substantive health plan provisions; B. Previous retiree health care actuarial valuation; C. Funding and/or Accounting policy; and, D. Actuarial assumptions in conjunction with proposed valuation. Phase II Develop Initial per Capita Premium Rates In fully-insured ratings, active employees and non-medicare retirees are often assigned the same rate. Since health risk and utilization of medical services typically increase with age, this practice produces an implied subsidy to the retiree population. GASB and the Society of Actuaries Actuarial Standards of practice require the use of true retiree cost in retiree health care valuations. All developed retire premiums must be associated with each individual age by adjusting the blended fully-insured rates with the ratio of the expected cost at the age and the expected cost at the average age of blended active and non-medicare eligible population. For the self-insured plans, calculations of the per capita health care rates are based on the group s own retiree experience where credible experience is available. In the absence of credible retiree group benefit experience data, the Offeror may blend the group s own experience with a normative claims database to calculate the per capita rates. The annual per capita health care rates will be projected on an incurred claim basis, adjusted for plan design changes, large claims, trend, and loaded for administrative expenses. 6

Age/gender specific per capita health care rates will be developed based on fully disclosed age/gender rating factors. Phase III Prepare the Valuation The prepared actuarial valuation of OPEB must include: A. Liabilities for present and future retirees and reflect retiree contribution rates as of December 31, 2015; B. The Annual Required Contribution for the Fiscal Years beginning October 1, 2016 and October 1, 2017. The valuation must be based on assumptions and methods that comply with all relevant GASB Statements for OPEB plans. Work Plan The anticipated work plan to complete the actuarial valuation would include the following steps: 1) Define data requirements and request information; 2) Provide any preliminary recommendations relating to assumptions or methods; 3) Collect census and asset information and review for reasonableness; 4) Review the current substantive plan and most current actuarial valuation. Specifically, review the assumptions, methods, and funding policy; 5) Gather information required to determine the per capita health care rates; 6) Select other economic, demographic, and long-term health care assumptions; 7) Select actuarial funding method; 8) Develop the retiree premium associated with each individual age; 9) Perform an actuarial valuation of the retiree health plan; 10) Develop the Annual Required Contribution (ARC) for the fiscal years specified in Phase III detail; 11) Perform sensitivity tests and/or a benefit projection, if the Board decides on these options; 12) Prepare a report of the actuarial valuation; 13) Serve as technical advisor on matters of an actuarial nature. 7

Professional Consulting Staff The Proposer s staff assigned to this actuarial valuation of OPEB must have extensive experience and expertise in retirement plans, health care benefits, and their associated costs. Consulting Fees Proposed consulting fees shall be based on time spent in performing the services as described above for GHS. Your Quotation shall be an all-inclusive total cost which includes the associated products and services. Provide your proposed all-inclusive fee for a valuation of the retiree health care plan. The above quoted Element shall cover a biennial actuarial retiree health care valuation based on an intermediate health care trend assumption, including the following: Two OPEB benefit groups (pre/post 1983) with different eligibility conditions and health benefits. One contribution rate for each of two fiscal years included in one report. One set of initial per capita costs based on up to two distinct self-insured retiree medical plans. One set of initial per capita costs based on one self-insured dental and one selfinsured vision plan. The Actuarial firm shall submit the following information with their quotation: 1. Number of hours included for in the all-inclusive cost identified above covering consulting time to review substantive plan; 2. Number of hours included for finalizing the summary of benefits; 3. Number of hours available for editing the census data. 4. Specify the hourly rates which would apply, should hours in excess of those listed above be required. 8

5. Specify the costs associated with on-site meetings, should a presentation of these materials and data be required. Responding actuarial firm shall calculate the Annual Required Contribution (ARC) and submit such, for the fiscal years beginning October 1, 2016 and October, 2017. It is possible that the scope of service may change and in that case, additional fees may apply. The selected actuarial firm must contact GHS before starting any additional work. ADDITIONAL OPTIONAL SERVICE:. Additional Optional Services, shall be quoted at a firm fixed all inclusive cost. 1. A sensitivity analysis would include two additional sets of advance funding contribution calculations, based on pessimistic and optimistic health care trend assumptions to forecast future increases in health care costs. 2. A 20-year benefit projection provides a projection of future retiree health care benefits based on intermediate trend assumption. PROJECT TIMING The selected actuarial firm shall be prepared to initiate the valuation upon receipt of the clean data, following approval from GHS. GHS projects that clean data will be provided by June 17, 2016. Bidding actuarial firms must provide their projected timeline specifying the length of time until the selected firm will provide all necessary reporting documentation and OPEB Valuations. 9

GENESEE HEALTH SYSTEM REQUEST FOR QUOTE ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS II. OFFEROR CRITERIA AND RESPONSE REQUIREMENTS A. Service Delivery System 1. Offeror shall provide a list of the customers they served during the past two years. 2. Offeror shall provide a list of customer references including company names, contact names and phone numbers for follow-up. A minimum of four (4) complete references shall be provided by Offeror. 3. Offeror shall demonstrate their companies experience and expertise providing the specific services as requested within this RFQ. 4. Offeror shall describe the technical support services available to the Group along with any associated costs, if applicable. 5. Offeror shall provide a detailed time-table to meet documentation and reporting needs identified within the Service Description section of this RFQ. Assuming clean data being provided by June 17, 2016, Offeror shall specify the length of time to provide for the specified documentation and service of this RFQ. 6. Offeror shall provide documentation supporting ability to demonstrate a proven track record of Actuary Services; and especially, in regards to OPEB Valuation services and reporting. 7. Offeror shall disclose any and all lawsuits, litigation, or sanctions whether awarded, enforced, or encumbered against or by your company, agency, directors, owners, or employees within the past 10-years, as could relate to the provisions of this contract in the providing of Actuary Services. 8. Offeror shall provide examples of their customized template(s) through which your company intends to collect all data requirements and shall submit together with their quotation. This is mandatory. B. Legal Structure and Financial Viability 1. The Offeror shall attach a copy of its Certificate or License (if applicable). 10

2. The Offeror shall attach a certificate of professional liability (errors and omissions) in a sum of not less than $1 Million per claim and $1 Million annual aggregate. 3. The Offeror shall attach a certificate of general liability insurance with Broad Form General Liability Endorsement or equivalent, if not in policy proper, Provider and Contractual liability coverage with limits of not less than $1 Million per occurrence and $1 Million annual aggregate. C. Rate Submission for Service(s) to be provided The Offeror must submit a rate for services as described in this RFQ. Offerors awarded the contract may be expected to provide information or be present at Board site reviews without additional cost to the Board. (If there is an additional cost, the costs must be clearly identified.) The Offeror must include a rate for service for the fiscal years ending September 30, 2014 and September 30, 2015; and present an additional quotation covering the fiscal years ending September 30, 2016 and September 30, 2017 for consideration. Quotes must represent the total all inclusive cost of providing Actuary Services for Other Post-Employment Benefits (OPEB) Valuations. See Service Description, Consulting Fees with all associated detail. Offeror shall provide their proposed all-inclusive fee for a valuation of the retiree health care plan. The Offeror shall submit the following information with their quotation: 1. Number of hours included for in the all-inclusive cost identified above covering consulting time to review substantive plan; 2. Number of hours included for finalizing the summary of benefits; 3. Number of hours available for editing the census data; 4. Specify the hourly rates which would apply, should hours in excess of those listed above be required; 5. Specify the associated cost(s) should a meeting(s) be required, or a 11

presentation of the reporting data as may be requested by the GHS Board of Directors.. Responding actuarial firm will calculate and submit the Annual Required Contribution (ARC) for the fiscal years beginning October 1, 2016 and October, 2017. ADDITIONAL OPTIONAL SERVICES Additional Optional Services, as specified within the RFQ Service Description: ALTERNATIVES Should your firm identify anything that was missed which should be a part of this RFQ opportunitiy, please identify these as ALTERNATIVES. 12

GENESEE HEALTH SYSTEM REQUEST FOR QUOTE ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS III. OFFEROR COVER SHEET Name of Organization: Address: Authorized Representative: Title: Telephone Number: Fax Number: Person(s) to Contact: For Board representative to ask questions regarding the contents of the bid packet: Contact Name: Title: Telephone Number: E-mail Address: Program Services Included in the Quote: ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS 13

GENESEE HEALTH SYSTEM REQUEST FOR QUOTE ACTUARY SERVICES FOR OTHER POST-EMPLOYMENT BENEFITS (OPEB) VALUATIONS IV. TIME REQUIREMENTS 1) All Offerors MUST indicate the Intent to Bid to the Board s Contract Management Department via email at RFQreplies@genhs.org no later than 3:00 PM on May 5, 2016. 2) Questions may be submitted to the Board s Contract Management Department via email at RFQreplies@genhs.org no later than 3:00 PM on May 5, 2016. 3) Questions and answers will be compiled and posted on the Board website and emailed to those who indicated their intent to bid with posting on the GHS website www.genhs.org under the RFP Opportunities link, by NOON on May 9, 2016. 4) Final Quotes must be received by mail or in person at GHS, 725 Mason St., Flint, MI 48503 no later than 2:00 P.M. EDT on May 13, 2016. 14