240000001383 LTD Questions Answers.pdf

Michigan.gov/MiProcurement

BIDDER QUESTIONS & ANSWERS

Version 2021-2

Request for Proposal No. 240000001383 Long Term Disability Insurance Administration Services

Bidders who submitted questions for the above Solicitation by the deadline have answers below.

Q # Document and Section

Page # Bidder Question Answer

1 Statement of Work Section 1.2.1

4 Referencing the LTD policy document, LTD Elimination Period is: (17) Waiting period means the period ending on the later of the following days: (a) The day after the claimant’s sick leave is exhausted or (b) The fourteenth (14th) calendar day of the claimant’s disability (30th calendar day for enlisted State Police troopers and sergeants). How is the administrator notified of the expiration of sick leave?

For some state departments, a daily State of Michigan report delivered to the Contractor notifies of the projected sick leave expiration. The report provides updated expiration dates in the event leave balances change during the initial phase of the disability absence. For other departments, communication with the applicable human resources office is required.

2 Statement of Work Section 1.2.1

4 Referencing the LTD Policy document, we were instructed to review as part of this section, regarding termination of benefits for Plan 1, the benefit (Page 9): Plan I:

LTD payments under Plan I will terminate 24 months after the date the first monthly payment was paid or would have been

Under Plan 1, the maximum length of eligibility for a benefit is 24 months for a period of disability after the waiting period, even if the employee remains totally disabled or has other income offsets. It is possible that a claimant would not be paid if the claimant was not entitled to Other Income. (See “Other Income” section) There is not a reference in the Other Income section to this specific termination provision. Does this mean if the individual cannot work, is not eligible for SS or a state pension or any other offsets that benefits terminate regardless of disability?

eligible for any disability payment because of other offsetting income.

3 Statement of Work Section 1.6.6.10

23 You require that checks expire 180 days from issuance. Do you allow for EFT payment of claims? If not, would you consider adding it to the plan?

Yes, EFT is an allowed payment method.

See the attached “Schedule A Statement of WorkREVISED” with updated language in Section 1.6.6.10 (also highlighted pale yellow), 4 Statement of Work Section 5.4.7.2

57 Under claim reporting, please explain these categories:

• Process Level Description

• Process Level Code

A Process Level Code is a four-digit number that represents an employee’s department and agency in which they work.

The first two digits represent the department, and the last two digits represent the agency. For example, Process Level Code 4748 represents Department of Corrections (47) and Bellamy Creek Correctional Facility (48).

The Process Level Description describes that location, such as “DOC-BELLAMY

CREEK FACILITY”.

Process level code will be included on the weekly file outlined in Schedule F and the description will be provided to Contractor prior to implementation.

5 Schedule B Pricing

LTD Plan Pricing Tab

For the self-funded six month maximum LTD/STD benefit plan, what elimination period would you like us to quote?

The latter of 14 days or expiration of sick leave, the same as for the existing plan.

6 Schedule B Pricing (and Statement of Work)

Various pages

Can you please provide an estimate of the annual number of IMEs performed over the last 3 years?

CY2021 – 201

CY2022 – 201

CY2023 - 267

7 Statement of Work Section 4.11 Disclosure of Subcontractors

48 It is typical for plan administrators to have subcontractors that supply services as part of the day-to-day operations for their entire book of business. These subcontractors are not hired for, or exclusive to a Contract with the State of Michigan. Can you please confirm that the State of Michigan defines subcontractors as those engaged exclusively to provide services for the State of Work in Schedule A?

No. Refer to the Permitted Subcontractor definition in Hybrid Contract Terms Section 14.

8 Hybrid Contract Terms, 1(i.)

1 Please provide us with the State physical and IT security policies

Refer to Schedule A, Section 2. For a copy of the non-public Policies, Standards and Procedures, Bidders are required to sign and email the Solicitation Manager a Non- Disclosure form (attached). See also the updated Proposal Instructions and Vendor Questions Worksheet for associated deadline to request, as well as the added Section 5.2.

9 Hybrid Contract Terms, 14

5 Does the State agree that subcontractors are those hired exclusively to perform services related to the State’s self-funded LTD business?

No. Refer to the Permitted Subcontractor definition in Hybrid Contract Terms Section 14.

10 Hybrid Contract Terms, 15

6 Does the State agree that bidders will retain authority for decisions with respect to their own personnel?

Language provided in this Section is required for this Contract. Refer to Section 6 of the Vendor Questions Worksheet and Section 6 of Proposal Instructions as it pertains to Contract Terms.

11 Hybrid Contract Terms, 25

8-9 Is the State amenable to performance guarantees in this regard?

Language provided in this Section is required for this Contract. Refer to Section 6 of the Vendor Questions Worksheet and Section 6 of Proposal Instructions as it pertains to Contract Terms.

12 Hybrid Contract Terms, 31

10-11 Is the State willing to negotiate on the indemnification terms in the standard Hybrid Contract?

Language provided in this Section is required for this Contract. Refer to Section 6 of the Vendor Questions Worksheet and Section 6 of Proposal Instructions as it pertains to Contract Terms.

13 Hybrid Contract Terms, 33

11-12 We have an Administrative Services Agreement (ASA) tailored to LTD claims administration services. Is the State amenable to considering the limitations of liability in our ASA?

No, Language provided in this Section is required for this Contract. Refer to Section 6 of the Vendor Questions Worksheet and Section 6 of Proposal Instructions as it pertains to Contract Terms.

14 Schedule B Pricing

LTD Plan Pricing Tab

Please clarify what is meant by having a fee basis of “per claimant per month.”

• Does this mean newly opened claims per month, Or

• Does this mean all claims open in a given month? And if so, how is this measured?

− Are any claims that were open at any point in a given month counted toward this total, or

Any claim open within the month, from the 1st day to the last day of the month. This includes pending claims, claims that were open on the 1st of the month and then subsequently closed, and all other open claims. Approved claims will be considered closed based on the paid through date unless otherwise indicated by bidder.

− Is there a snapshot of open claim counts at a specific, pre-defined, point in each month? And if so, when shall this snapshot be taken?

− For either of the above, would a claim be counted if it is only an open, approved claim, or shall pending claims be counted as well?

15 Schedule B

Pricing LTD Plan Pricing Tab

Does the state anticipate maintaining the same level of contributions for each plan going forward?

How does the State expect its contributions will change under the proposed 6-month alternative design?

The state anticipates the same total premium for both plans under the current plan design.

If the proposed 6-month alternative plan design was implemented in the future, the intention would be for the state to cover the entire contribution amount. Please note that as a self-funded plan, treatment of the premium is not relevant to the Contractor and Bidder’s response to this RFP.

16 Schedule B Pricing

Information al Data Tab

Please provide a recent census with:

• Age/DOB

• Gender

• Zip code

• Salary

• Sick Bank Time

• Benefit Class

Census data showing the requested information for employees enrolled in the LTD plan as of 3/14/24 is accessible via the (attached) Schedule J LTD Enrollment Census.

17 Proposal Instructions Vendor Questions

3-4 The Respond to Lines section of the SIGMA VSS system shows 5 separate commodities for the LTD bid. Our fee and

All pricing should be submitted in Schedule B Pricing. There were 5 lines inserted to accommodate five commodity codes

Worksheet –

SIGMA VSS

system submission.

contract amount are inclusive, they are not broken down by separate components.

Please confirm if each line must be completed, and if so, clarify what information is expected in each section.

related to this solicitation (SIGMA VSS sends alerts to vendors based on commodity codes). These lines do not need to be completed, however due to SIGMA functionality, it may require you to not leave the field blank, therefore enter a value such as $1.00.