Commonwealth Pricing Clarifications Questions - PRF57 - Sevenstep Responses - 03132020.docx

Commonwealth Pricing Clarification Questions for PRF57 - Sevenstep March 13, 2020

1. As far as you can share with us, what are the foundations of your rate determination?

Sevenstep Response: The RFR Pricing Sheet and the Maximum Pay Rates were established by researching current compensation ranges in Boston and the Commonwealth of Massachusetts using industry standard tools including CareerBuilder Supply & Demand and Indeed in addition to feedback from current suppliers providing these services within the Commonwealth of Massachusetts.

Sevenstep arrived at the maximum rate per role using the Service Categories provided by the Commonwealth in the form of the RFR Pricing sheet and assumed a mid-range level of experience (3-5 years. This maximum rate per role is inclusive of all fees (MSP Fee, Mark-up Amount, Supplier Amount, etc) and does not represent the amount the contractor was paid. Sevenstep now understands that the rate the Commonwealth wishes to see is the actual pay to the contractor. This rate, coupled with the additional pricing information provided by Sevenstep, would allow the Commonwealth to arrive at a total cost calculation.

As no specific job descriptions were provided for each of the Service Categories as part of the RFR, estimates were made as to the specific responsibilities and tasks that are to be performed by each role. Sevenstep will provide proposed final rates based on research, feedback from providers, and the Commonwealth’s historical trends and data. In all cases, the Commonwealth would approve all rates prior to implementation.

1. What is the benchmark that you used in coming up with the rates?

Sevenstep Response: Sevenstep used the mid-range level of expertise as the benchmark for each role in the RFR Pricing Sheet. Sevenstep assumed an expertise level of 3-5 years of experience for the Boston area and the Commonwealth as a whole. Should this approach not meet with the Commonwealth’s expectations, Sevenstep would welcome the opportunity to customize and expand those benchmarks on an ongoing basis to ensure they align with market conditions.

1. Have you reviewed the current rates that are being paid by the Commonwealth for this service and used that as a part of you price proposal submission?

Sevenstep Response: No. Sevenstep did research the active PRF57 on CommBuys, set to expire in June 2020. While Sevenstep was able to access the original bid and subsequent award, we were prevented from directly accessing the files associated with the award, including the pricing schedule. As such, Sevenstep’s rates were proposed independently of the current rates being paid by the Commonwealth.

Sevenstep concluded that the documents of the current award were protected from view given the competitive bid situation with PRF57. Sevenstep now understands that we should have been able to access these files and may utilize them in preparation of Sevenstep’s response to the current bid. As such, Sevenstep has contacted the helpdesk of CommBuys and requested that appropriate access be granted.

Upon obtaining access and the ability to review the current pricing for the PRF71, Sevenstep will identify any variances between the proposed rate schedule and existing positions. Sevenstep will respond with an adjustment to the proposed pricing schedule reflective of the new information and to provide contractor pay rates vs. final bill rates as understood from Question 1.

On an on-going basis, Sevenstep will propose a rate reconciliation process that provides for reviewing the existing job descriptions and the proposed rates and confirming the most appropriate rate for subsequent approval by the Commonwealth. A rationalized rate card could then be implemented that reconciled any variance and could be accomplished on a frequency approved by the Commonwealth. This process of evaluating and confirming an updated, final rate strategy is part of our custom implementation process. The Commonwealth would benefit from Sevenstep researching and updating the rate card, that would be approved by the Commonwealth.

1. Outside of payment for labor service, is there anything else that is included in your “pay rate” structure?

Sevenstep Response: The rate of pay per the RFR Pricing Sheet represents the max rate to be paid to the supplier. Included within this pay rate is the Suppliers employee’s rate of pay, employment taxes, employee benefits burden and any margin released by the supplier. Additionally, charges for the MSP program reflect implementation, program review and optimization, formal reporting, vendor management, engagement and relationship management, and all other activities involved with running a successful, streamlined program. The MSP charges for the administration of the MSP program, would be recovered within this pay rate as a charge to the supplier.

Sevenstep now understands that the rate that the Commonwealth wishes to see is the actual pay to the contractor. This rate, coupled with the additional pricing information provided by Sevenstep, would allow the Commonwealth to arrive at a total cost calculation. Typically, Sevenstep does not provide contractor direct pay rate information as this tends to lead to conflicts with co-employment matters which are often best avoided. However, based on the Commonwealth’s request, Sevenstep will be responding via CommBuys with an RFR pricing sheet that reflects the contractors’ actual rate of pay instead of the maximum rate of pay to be paid by the Commonwealth.

1. How does the different proposed rates by your company in your bid submission compare with those currently charged to your current clients?

Sevenstep Response: Sevenstep’s proposed rates are consistent with rates charged to Sevenstep clients within the Commonwealth of Massachusetts. Any variances that exist with Sevenstep clients outside of the Commonwealth are due primarily to cost of living variances and/or legislative requirements.

1. Are the pay rates you proposed in line with what you currently pay your local vendors?

Sevenstep Response: Yes, the pay rates proposed are in line with what is currently paid to our local vendors and again are reflective of what is paid to the supplier, not what is paid to the contractor. Per the above, Sevenstep will respond via CommBuys with an RFR pricing sheet that reflects the contractors’ actual rate of pay instead of the maximum rate of pay to be paid by the Commonwealth.