ESBD_486865_1770149799579_SBA-26-274 Self-Insured Employee Group Health Plan.pdf

THE TEXAS A&M UNIVERSITY SYSTEM

Office of Procurement and Business Services

REQUEST FOR PROPOSAL

RFP NUMBER: RFP-01-SBA-26-274

SELF-INSURED EMPLOYEE GROUP HEALTH PLAN ADMINISTRATION AND

65 PLUS MEDICARE ADVANTAGE PLAN

PROPOSAL MUST BE RECEIVED PRIOR TO:

2:00 P.M. Central time on March 16, 2026

EMAIL RFP RESPONSES TO:

soprocurement@tamus.edu

Subject Line: SBA-26-274 – Self-Insured Employee Group Health Plan Administration and 65 Plus Medicare Advantage Plan

NOTE: Proposal responses must be received by The Texas A&M University System Office of Procurement and Business Services before the date and time specified for receipt of proposal in Section 2.3 of this Request for Proposal (“RFP”).

After the due date and time, only the names of respondents may be made public.

REFER INQUIRIES TO:

Jeff Zimmermann, Executive Director Procurement and Business Services | VetHUB Program

The Texas A&M University System soprocurement@tamus.edu

All proposals shall become the property of The Texas A&M University System and the state of Texas upon receipt.

Proposals may be subject to public review after contracts have been executed. Refer to Section 4.10 for more information regarding confidential and proprietary information.

mailto:soprocurement@tamus.edu mailto:Soprocurement@tamus.edu

The Texas A&M University System RFP-01-SBA-26-274 Page 2 of 67

TABLE OF CONTENTS

SECTION 1. INTRODUCTION __________________________________________________________________ 4

1.1 Scope

1.2 Background

1.3 Plan Background

1.4 Enrollment

1.5 Purpose

1.6 Benefits Philosophy

1.7 Priorities/Expectations

1.8 Calendar of Events

1.9 Schedule of Implementation

1.10 Performance Period

SECTION 2. INSTRUCTIONS FOR RESPONDENTS __________________________________________________ 8

2.1 General Information

2.2 Examination of the Request for Proposal

2.3 Submittal Instructions

2.4 Proposal Components

2.5 Inquiries and Interpretations

2.6 Selection Process

SECTION 3. SCOPE OF WORK ________________________________________________________________ 12

3.1 Required Services

3.2 Current Funding

3.3 Contract Documents

3.4 Eligibility

3.5 Communications and Enrollment

3.6 Qualifications of Respondents

3.7 Actuarial Reporting

3.8 Claims Run-Off

3.9 Healthcare Management Performance Incentive

3.10 Pharmaceutical Information

3.11 Contract Documents

3.12 Eligibility

3.13 Communications and Enrollment

3.14 Qualifications and Respondents

3.15 Plan Design

3.16 Historical Claims Experience

3.17 Medicare Advantage Historical Experience

SECTION 4. PROPOSAL RESPONSE ____________________________________________________________ 19

4.1 Cover Letter

4.2 Company Profile

4.3 Organizational Chart

4.4 Staffing……………………………………………………………………………………………

4.5 Installation Team Staffing

4.6 References

4.7 Certification

The Texas A&M University System RFP-01-SBA-26-274 Page 3 of 67

4.8 Questionnaire

4.9 Data Files

4.10 Confidential and Proprietary Information

4.11 Deviations

4.12 Alternative Plan Design

4.13 Supplemental Information

4.14 VetHUB Subcontracting Plan

SECTION 5. GENERAL TERMS AND CONDITIONS _________________________________________________ 28

Exhibit A – Execution of Offer

Exhibit B – Non-Collusion Affidavit

Exhibit C – Insurance Requirements

Exhibit D – Questionnaire

Exhibit E – Supplemental Files to RFP Instructions

Exhibit F – HIPAA Business Associate Agreement (DRAFT)

Attachment: FY26 Vet HUB Subcontracting Plan Form

The Texas A&M University System RFP-01-SBA-26-274 Page 4 of 67

SECTION 1 - INTRODUCTION

1.1 Scope

The Texas A&M University System (“A&M System”) is soliciting proposals from qualified vendors licensed to operate in the state of Texas to provide claims and network administration services for employees, graduate student employees, retirees, and their dependents enrolled in the A&M Care plan, a self-insured Preferred Provider Organization (PPO) employee group health plan beginning September 1, 2026. In addition, the A&M System is soliciting proposals for the fully insured 65 Plus Medicare Advantage Plan (PPO) for Medicare Eligible retirees and their covered dependents beginning January 1, 2027. The A&M System desires proposals that represent the best combination of quality and cost.

It is the intent of the A&M System to establish a services agreement (the “Agreement”) with one vendor to meet the needs for both the A&M Care Plans and the 65 Plus Medicare Advantage Plan (PPO). The resultant Agreement will be between the selected vendor and the A&M System.

By submitting responses, each Respondent certifies that it understands this RFP and has full knowledge of the scope, nature, quality, and quantity of the work to be performed, the detailed requirements of the services to be provided, and the conditions under which the services are to be performed. Each Respondent also certifies that it understands that all costs relating to preparing and responding to this RFP will be the sole responsibility of the Respondent.

1.2 Background

A&M System is one of the largest and most impactful higher education systems in the country, with an annual budget of $8.1 billion. Its statewide network includes 12 universities, a comprehensive health science center, eight state agencies, Texas A&M-Fort Worth and Texas A&M-RELLIS. A&M System serves approximately 175,000 students and reaches millions more through service, research and outreach programs each year. With nearly $1.6 billion in annual research expenditures, the A&M System fuels innovation, supports communities and drives Texas’ economy forward.

More information about A&M System and all of its member universities and agencies (“Member” or “Members”) can be found at the A&M System About page.

1.3 Plan Background

The A&M System intends to continue to self-insure the A&M Care plan, maintaining a PPO managed care approach while continuing to offer the 65 Plus Medicare Advantage Plan on a fully-insured basis. The prescription drug plan is a carve-out program, providing prescription drug benefits to those enrolled in the A&M Care plans and is not included in this RFP. A separate RFP for prescription drug plan administration, effective September 1, 2027, will be issued next year.

The A&M System currently contracts with Blue Cross and Blue Shield of Texas for administration of the self-insured health plan and fully-insured Medicare Advantage plan and Express Scripts for administration of the self-insured prescription drug plans. The A&M System is required by law to rebid these contracts at least every six years. The current contract will expire on August 31, 2026.

In addition to the A&M Care self-insured PPO health plan, a fully-insured PPO health and prescription drug plan is available as an option to graduate student employees and their dependents. Most graduate student employees elect to enroll in the Graduate Student Health Plan rather than the A&M Care plan because of its lower premiums.

Respondents may link to the System Benefits Administration website at https://www.tamus.edu/benefits to review details of the current health plans offered by the A&M System.

http://www.tamus.edu/about/ https://www.tamus.edu/benefits

The Texas A&M University System RFP-01-SBA-26-274 Page 5 of 67

1.4 Enrollment

The A&M System currently has 26,213 benefit-eligible employees and retirees.

Current enrollment in the self-insured A&M Care PPO plans is 27,441. The 65 Plus Medicare Advantage Plan has an enrollment of 8610. Of the 27,441 enrolled in the A&M Care plans, 1318 are retirees under 65 with another 68 working retirees, 507 retirees with dependents that are not eligible for Medicare, and 285 on the J Plan, which meets visa requirements for employees on a J-1 or J-2 visa. There are 63,984 covered lives, including employees, retirees, survivors, COBRA participants and dependents in the A&M Care plan and 65 Plus Medicare Advantage Plan.

Exhibit E named Demographics contains a list of supplemental files that can be downloaded from the ESBD site with the link provided in Section 2.5 of the RFP. The file contains three worksheets. The first worksheet provides demographic information for all those who are benefit eligible, i.e. A&M Care Plan, Graduate Student Plan, those certifying that they have medical coverage other than through the A&M System and are allowed to use up to half of the employee-only employer contribution to pay for optional benefit plan coverage, and those who are eligible, but opt not to take A&M System health coverage. The second worksheet provides demographic information only for those enrolled in the A&M Care Plan. The third worksheet provides demographic information for those enrolled in the 65 Plus Medicare Advantage Plan.

1.5 Purpose

This RFP provides detailed information about the A&M System and its benefit needs and provides the required format for the vendor’s response. Proposals containing deviations are strongly discouraged. If included, deviations must be identified and described in detail in order to be considered. While a proposal with minor deviations from the RFP will not be disqualified, preference will be given to prospective vendors whose proposals contain the fewest and least significant deviations from the requirements presented herein.

The intent of this RFP is to allow all interested / prospective firms to provide a sufficient amount of data that will enable the A&M System to assess the proposal and qualifications of the Respondent. To this end, each Respondent shall furnish, as a part of the proposal, a complete general description of experience in their respective fields.

By submitting responses, each Respondent certifies that it understands this RFP and has full knowledge of the scope and nature of the opportunity described herein. Each Respondent also certifies that it understands that all costs relating to preparing and responding to this RFP will be the sole responsibility of the Respondent.

Respondent is to independently investigate and verify, at its own discretion, all information acquired from the A&M System or from any other source which is relied on by Respondent in the preparation of its proposal.

1.6 Benefits Philosophy

The A&M System’s benefit programs are viewed as an important part of the total compensation package.

It is expected that the benefits offered will attract new employees, promote the retention of career employees and reward retired employees for their service. Therefore, superior quality and responsiveness to participants’ needs are essential.

The A&M System is committed to providing eligible employees, retired employees and their dependents access to group benefit plans of the highest quality at the lowest possible cost to the A&M System and to its employees. The manner in which the programs are funded demands strict containment of costs in order to maximize benefits for the participants.

The Texas A&M University System RFP-01-SBA-26-274 Page 6 of 67

The self-insured A&M Care health plan for which an RFP is being solicited is available to all benefit-eligible employees at all System members and includes graduate student employees. Rather than each System Member soliciting RFP responses for the various benefit plans, the authority to plan, implement and control the A&M System’s benefit programs has been assigned to the Director of System Benefits Administration (the Director). The Director and Associate Director have responsibility for the design and development of System-wide health plans, and for the operation and administration of other employee benefit plans.

The System Benefits Administration (SBA) staff monitors plan experience, negotiates contracts, maintains official records, and ensures quality, efficiency, and statutory compliance in the benefit plans. SBA also maintains, reports, and analyzes claims and financial data related to the plans. It is the responsibility of each System Member to inform employees and retirees of their insurance eligibility, advise them about options and perform enrollment and counseling functions. These activities are usually performed in the Human Resource and/or Payroll departments of each System Member.

The plan for which proposals are being sought is not an ERISA plan. However, for the most part, we do comply with ERISA.

One tool to provide the A&M System administration with a continuous evaluation of benefit plans is the System Employee Benefits Advisory Committee (SEBAC). SEBAC consists of representatives from each System Member, retired employee representatives, and ex-officio members. Meetings are held several times per plan year between September and May to update participants on new developments and provide a forum for public comment. The conclusions of the committee are forwarded as recommendations to the Director for consideration or action.

1.7 Priorities/Expectations

Respondents should note the following priorities and expectations with regard to the possibility of the A&M System establishing a contractual relationship with any Respondent:

(a) Ensuring a Quality Level of Service. This priority encompasses the quality of the level of service that can be provided to all Members in a timely, cost-effective manner. The A&M System is seeking a Respondent that will ensure the provision of such quality in its delivery of service through proven training techniques and established metrics.

(b) Level of Experience and Expertise. Respondent must demonstrate its capabilities in providing the utmost level of experience and expertise to ensure successful implementation and delivery of services as determined by the A&M System.

(c) Delivery Efficiency as it Relates to Total Costs. Respondent must demonstrate its ability to deliver the required services in a cost-effective and timely manner while not sacrificing the quality required by the A&M System.

(d) Financial Stability. Respondent must demonstrate its financial stability and capabilities in providing the required services.

1.8 Calendar of Events

Activity Date

Release of Request for Proposal February 3, 2026

Deadline to Submit Questions February 13, 2026

Release of Addendum (if applicable) February 20, 2026

Responses Due March 16, 2026, by 2:00 p.m. Central Time

Presentation/Interview (if applicable) March 27, 2026

The Texas A&M University System RFP-01-SBA-26-274 Page 7 of 67

Selection of Respondent April 1, 2026

The A&M System will make every effort to adhere to the above schedule. The schedule, however, is subject to change. This may be in the event that further clarification of responses or terms of contract are in the best interest of the A&M System and/or in the event the A&M System requires more time to assure that the selection of the Respondent is in accordance with its policies, rules and regulations, as well as actual timing needs.

1.9 Schedule of Implementation

Awarded Vendor. These dates are tentative and subject to change based on the needs of the A&M System.

Within 6 weeks Upon notice of award, Vendor will provide first draft of Administrative Services Agreement, Medicare Advantage Group Administration Agreement, group policy, riders, group certificates, draft of HIPAA Business Associate Agreement, and any other required legal documentation.

June 15, 2026 Information materials finalized and mailed.

July 10 – July 31, 2026 Open Enrollment period for all A&M System employees for September 1, 2026 effective date

July 2026 Summary Plan Description (SPD) written and edited by System Benefits Administration and submitted to vendor for comments

August 3, 2026 All documents necessary for claim processing available to System Benefits Administration

August 10, 2026 Initial Annual Enrollment file provided to carrier

August 15, 2026 Administrative Services Agreement, Medicare Advantage Group Administration Agreement, and any other required legal documentation completed and signed by both parties

No later than August 25, 2026 Member ID cards mailed by carrier (December 15, 2026 for 65 Plus

Medicare Advantage Plan)

September 1, 2026 Effective date of plan

1.10 Performance Period

An initial three-year period of performance under a contract pursuant to this RFP will commence on September 1, 2026, for the self-insured A&M Care Plans and January 1, 2027, for the fully-insured 65 Plus Medicare Advantage Plan. Premiums, fees, expense schedules, charges, and management arrangements must be guaranteed for the three-year period through August 31, 2029, for the self-insured A&M Care Plans and December 31, 2029, for the fully-insured 65 Plus Medicare Advantage Plan. Assuming satisfactory performance and terms and fees are mutually agreed upon in writing prior to the expiration of the agreement, an affirmative renewal for up to three years may be allowed; and if so, shall be in writing and executed by authorized representatives of each party to the agreement. In the event of successive affirmative renewal(s), the maximum period of performance pursuant to this RFP ends August 31, 2032, for the self-insured A&M Care Plans and December 31, 2032, for the fully-insured 65 Plus Medicare Advantage Plan. Any renewal must be agreed to in writing by both parties.

The Texas A&M University System RFP-01-SBA-26-274 Page 8 of 67

SECTION 2 – INSTRUCTIONS FOR RESPONDENTS

2.1 General Information

This RFP outlines the services and proposal requirements in Section 3. Proposals are to be in accordance with the outline and specifications contained herein, are to remain in effect a minimum of 180 days from the date of submission and may be subject to further extensions as negotiated. A statement to this effect should be contained in the Respondent's cover letter.

Each proposal shall be prepared simply and economically, providing a straightforward and concise description of the Respondent’s ability to meet the requirements of this RFP. Emphasis shall be on completeness, clarity of content and responsiveness to the offer requirements.

This RFP contains specific requests for information. Respondents are encouraged to examine all sections of this RFP carefully, in that the degree of interrelationship between sections is critical. In responding to this RFP, Respondents are encouraged to provide any additional information they believe relevant.

Clause headings appearing in this RFP have been inserted for convenience and ready reference. They do not purport to define, limit or extend the scope or intent of the respective clauses. Whenever the terms “must", "shall", "will", "is required”, or "are required” are used in the RFP, the subject being referred to is to be a required feature of this RFP and critical to the resulting submittal.

In those cases where mandatory requirements are stated, material failure to meet those requirements could result in disqualification of the Respondent's response. Any deviation or exception from RFP specifications must be clearly identified by the Respondent in its submittal.

Expenses for developing and presenting proposals shall be the entire responsibility of the Respondent and shall not be chargeable to the A&M System. All supporting documentation submitted with this submittal will become the property of the A&M System.

By submitting a proposal, Respondent agrees that Respondent and Respondent’s employees and agents are independent vendors and have no employer-employee relationship with the A&M System. The A&M System shall not be responsible for the Federal Insurance Contribution Act payments, federal or state unemployment taxes, income tax withholding, Workers’ Compensation Insurance payments, or any other insurance payments, nor will the A&M System furnish any medical or retirement benefits or any paid vacation or sick leave.

The A&M System reserves the right to alter the specifications of its benefit programs and subsequently negotiate with the selected Respondent as needed to comply with any required changes.

In the event the selected organization fails to perform any of its duties or obligations as provided by the contract which will include the RFP and the Respondent’s response to the RFP, the A&M System without limiting any other rights or remedies it may have by law, equity or under contract, shall have the right to terminate the contract immediately. The selected organization understands and acknowledges that, notwithstanding any termination of the contract, certain obligations shall survive the termination of the contract.

In addition to and without restricting or waiving any other legal, contractual or equitable remedies otherwise available to the A&M System, the A&M System may terminate the contract without cause by giving the selected organization ninety (90) days written notice.

In the event of a change in condition which may affect the group health plan administrative services for which proposals are solicited, the A&M System will expect a good-faith effort from any Respondent selected, to absorb additional liabilities during the term of the contract without requiring rate increases until the next following renewal date. Such changes in condition include, but are not limited to, the following:

The Texas A&M University System RFP-01-SBA-26-274 Page 9 of 67

• Rules of the Texas Department of Insurance.

• Opinions of the Attorney General of the state of Texas.

• Federal and State statutes, court decisions and regulations from agencies and departments that may affect employment and benefit programs.

2.2 Examination of the Request for Proposal

Before submitting, each Respondent will be held to have examined A&M System requirements outlined in Section 3 and satisfied itself as to the existing conditions under which it will be obligated to perform in accordance with the scope and specifications of this RFP.

No claim for additional compensation will be allowed due to unfamiliarity with the specifications and/or existing conditions. It shall be understood that the Respondent has full knowledge of all the existing and/or revised conditions and accepts them "as is."

2.3 Submittal Instructions

All proposals must be received by the A&M System no later than 2:00:00 p.m. Central Time, March 16, 2026 electronically via email to soprocurement@tamus.edu with the subject line of “SBA-26-274 Self- Insured Employee Group Health Plan Administration and 65 Plus Medicare Advantage Plan”. The sent time indicated within the A&M System email server shall be used for the receipt and acceptance of the response. A file sharing tool may be used to submit the proposal response if large file sizes are an issue. If opting to use a file sharing tool it is recommend to send a test file prior to the due date.

It is each Respondent’s responsibility to ensure that the entire submittal response is received by the A&M System by the deadline stated above regardless of submission method. Late submittals will not be considered under any circumstances.

Submittal File Format: Submission shall be saved as two (2) separate files in Adobe Portable Document Format (PDF) according to the items listed below and named as such: I) “company name – Proposal” and II) “company name – Forms”.

2.4 Proposal Components

The following documents and all requirements from noted sections are to be returned as part of Respondent’s proposal submittal. Failure to include these documents may be basis for response disqualification.

I. Proposal

Cover Letter (Section 4.1)

Table of Contents

Proposal (Section 4.2 – 4.13)

II. Forms

Signed Execution of Offer (Exhibit A)

Non-Collusion Affidavit (Exhibit B) – signed and notarized

Vet-HUB Subcontracting Plan (Section 4.14)

Proposal format: The proposal response shall be presented in the order listed above with sections noted accordingly for easy reference. The Table of Contents shall provide page numbers for each section of the proposal.

mailto:soprocurement@tamus.edu

The Texas A&M University System RFP-01-SBA-26-274 Page 10 of 67

Forms: Additional information regarding the Execution of Offer and Non-Collusion Affidavit.

• Execution of Offer: The signature in the Execution of Offer within the electronic copy shall serve as the official signature of record. Signature can be done electronically with DocuSign, Adobe or another similar tool.

• Non-Collusion Affidavit: The Respondent signature on this document may be done electronically with DocuSign, Adobe or another similar tool. An agreement may not be executed with the awarded Respondent until this document is fully signed and notarized.

2.5 Inquiries and Interpretations

All technical questions concerning this RFP are to be directed, in writing, to Jeff Zimmermann, Executive Director, Procurement and Business Services to soprocurement@tamus.edu. Respondent may not contact other individuals at the A&M System to discuss any aspect of this RFP, unless expressly authorized by the Procurement Office to do so.

Questions regarding the RFP, including questions for more data or information beyond that included in this RFP and any attachment, should be presented in writing. Deadline for submission of questions is February 13, 2026.

Responses to inquiries which directly affect an interpretation or change to this RFP will be issued in writing by addendum/amendment and posted to the Electronic State Business Daily (ESBD) according to the schedule in Section 1.8. CLICK HERE for the posting to obtain all documents related to this RFP. You may also copy and paste the following link (https://www.txsmartbuy.com/esbd) into your browser and input Agency Number “710” and select “Posted” for the Status.

All such addenda/amendments issued by the A&M System prior to the time that proposals are received shall be considered part of the RFP, and the Respondent shall consider and acknowledge receipt of such within Exhibit A. Addendums issued and not acknowledged by the Respondent shall be considered accepted. Only formal written addenda issued by the A&M System in response to an inquiry shall be binding. Oral and other interpretations or clarification will be without legal effect.

2.6 Selection Process

Proposals submitted in response to this RFP shall be evaluated on the basis of the criteria listed below with the selection being the proposal that the A&M System deems to represent the best value to the A&M System. The list of criteria is not exhaustive and is not listed in order of importance. While the criteria shall provide the basis for an objective evaluation of each proposal, the experience and judgment of the SBA staff and the evaluation committee shall also be important in the selection process.

• Compliance with the requirements listed in the RFP

• Vendor License

• Provider Network Adequacy and Accessibility

• Provider Network Quality

• Financial Strength and Stability

• Administrative Capability

• Healthcare Management Incentive

• Past experience

• Customer/Member services

• Costs

• Organizational flexibility

• References

• Finalist presentations mailto:soprocurement@tamus.edu https://www.txsmartbuy.com/esbd?agencyNumber=710&page=1&status=1 https://www.txsmartbuy.com/esbd

The Texas A&M University System RFP-01-SBA-26-274 Page 11 of 67

The A&M System is not required to select the lowest priced proposal but will take into consideration other factors such as those enumerated above.

The RFP provides the information necessary to prepare and submit proposals for consideration by the A&M System. All properly submitted proposals will be reviewed, evaluated, scored and/or ranked by the A&M System. The A&M System may compile a final ranking of the Respondents in the order that they provide the overall “best value” to the A&M System based on an evaluation of the responses to the RFP. The A&M System may interview one or more of the top ranked Respondents as part of the evaluation process.

After proposal tabulation and such investigation of Respondents as the A&M System deems appropriate, an award may be made to the Respondent whose proposal it judges to represent the best value to the A&M System. Final determination for award of the contract will be made on the overall best value to the A&M System. The A&M System reserves the right to reject any or all proposals.

The selection of the successful proposal may be made by the A&M System on the basis of the proposals initially submitted, without discussion, clarification, or modification. In the alternative, selection of the successful proposal may be made by the A&M System on the basis of negotiation with any of the Respondents. The A&M System shall not disclose any information derived from the proposals submitted by competing Respondents in conducting such discussions.

All proposals must be complete and convey all of the information requested to be considered responsive.

If a proposal fails to conform to the essential requirements of the RFP, the A&M System alone will determine whether the variance is significant enough to consider the proposal susceptible to being made acceptable, and therefore a candidate for further consideration, or not susceptible and therefore not considered for award.

The A&M System may perform reference checks and seek further information, as needed from all Respondents whose proposals A&M System, at its discretion, considers viable, based on the initial evaluation and scoring. The Respondent’s response to this requirement officially authorizes A&M System to contact these organizations to discuss the services and other considerations which the Respondent has provided to such organizations and authorizes the organizations to provide such information to A&M System and Respondent shall and hereby does release and hold harmless A&M System, the state of Texas, and the organization of any and all liability whatsoever, in connection with providing and receiving all such information. Any negative responses received from reference checks may be grounds for disqualification of the proposal.

The A&M System may cancel this RFP or reject proposals at any time prior to an award and is not required to furnish a statement of the reasons why a particular proposal was not deemed to be the most advantageous. The selection of the successful proposal may be made by the A&M System on the basis of the proposals initially submitted, without discussion, clarification, or modification. In the alternative, selection of the successful proposal may be made by the A&M System on the basis of negotiation with any of the Respondents. The A&M System shall not disclose any information derived from the proposals submitted by competing Respondents in conducting such discussions.

By submitting its proposal in response to this RFP, Respondent accepts the evaluation process and acknowledges and accepts that determination of the “best value” firm will require subjective judgments by the A&M System.

The Texas A&M University System RFP-01-SBA-26-274 Page 12 of 67

SECTION 3 – SCOPE OF WORK

3.1 Required Services

Notwithstanding other sections of this RFP which describe administrative interactions, Respondents are advised of the administrative requirements listed in this section of the RFP. The selected Respondent will become responsible for these items and services to the A&M System upon the award of any contract. Any cost associated with these items and services must be included in your proposal.

a. Benefit contracts, affirmed by the A&M System as to form and content and approved by the State Board of Insurance in accordance with state and federal statutes, and technical and legal assistance in the administration thereof.

b. Management agreements, in addition to any benefit contracts, which formalize the A&M System’s relationship with any carrier.

c. Communication materials necessary for the proper administration of the plans (including but not limited to claim forms, identification cards, Explanation of Benefits forms) subject to editing of format, content and final approval by the A&M System.

d. Claim management and processing.

e. Monthly, quarterly, and annual management reports, including but not limited to, enrollment, claims, utilization, patient satisfaction, and case management information as agreed to by the A&M System and the Respondent.

f. Ad hoc claim/utilization reports or analyses as requested by the A&M System which do not represent extraordinary data processing effort by the claim administrator.

g. Process eligibility information on a weekly basis via secure sFTP. Provide SBA with a discrepancy report for each file.

h. Representation at open enrollment meetings across the state during the month of July. (Refer to Section

3.12 of the RFP)

i. COBRA premiums will be set at 102% of the normal premium. In addition, premiums for disability COBRA extension participants are 150% of the normal premium. Coordinate with the A&M System COBRA administrator as necessary to fulfill COBRA requirements.

Currently there are 187 terminated employees, dependents, participants reaching the age maximum, and participants due to divorce enrolled in COBRA coverage.

3.2 Current Funding

The A&M Care Health Plans are self-funded plans. The contract to be executed for the A&M Care Plans shall involve no insurance or reinsurance. The 65 Plus Medicare Advantage Plan is a fully-insured plan.

The contract shall be for administrative services, claims processing, network management and credentialing, utilization review, and disease management services as described within this RFP. The cost to meet the requirements described in this RFP shall be recovered by the vendor only by making provision for such expense in the vendor’s Price Proposal Worksheet included in Section l. Funding for all health plans is derived from the statutory contribution from the State of Texas and personal payments by participants (payroll deduction or billing/bank draft for retirees). The A&M System’s plan year corresponds to the State and A&M System fiscal years, which begin on September 1st and end on August 31st.

3.3 A&M Care Plans Administrative Fee

The Respondent shall propose an administrative fee for the A&M Care Plans which will be guaranteed for

The Texas A&M University System RFP-01-SBA-26-274 Page 13 of 67 three years. The administrative fee proposed should be adequate to cover costs incurred for the performance of all services described within this RFP, both prior to and during the period of the contract as well as during any runoff period following termination of the Contract.

3.4 Medicare Advantage Plan Pricing

The A&M System and the Respondent will negotiate the 65 Plus Medicare Advantage Plan premium on or before July 1 preceding the beginning of the applicable Calendar Year. The A&M System will specify the timing of the rate negotiations. The Respondent is required to provide a guaranteed maximum trend rate for each year during the term of the contract (CY2027-2029) in addition to guaranteed administrative fee, risk margin and Stars Rating portions of the premium rate. The premium rate proposed must cover the cost incurred for the performance of all services described herein prior to and during the Contract Term and during any runoff period following termination of the Contract.

3.5 Payment Methodology for Administrative Fees, Premiums, and Claims

For each month, the A&M System shall pay the Respondent per employee (employee/retiree) per month administrative fees and/or Medicare Advantage premium rates which may become due under the contract.

The Respondent shall process and pay all claims submitted under the A&M Care Health Plans as described herein. For the self-insured A&M Care Plans, the Respondent shall pay claims from the Respondent’s account prior to seeking reimbursement from the A&M System. The Respondent shall be responsible for maintaining its own funds which are sufficient to provide for the costs incurred under the A&M Care Health Plans.

The Respondent shall be reimbursed only for actual claim payments (i.e., it is not acceptable for the Respondent to seek reimbursement from the A&M System in an amount that is different than the amount the Respondent paid to the provider, facility, or participant). The Respondent shall be reimbursed only for paid claims, and shall not be reimbursed for claims that have been processed but not yet paid.

If the Respondent’s contracts with providers include payment on a capitation basis, such capitation shall be submitted and reimbursed as any other claim as described above. Reimbursement of capitation amounts shall be subject to adequate documentation presented by the Respondent. Such documentation shall include the provider’s name, the number of A&M Care participants included in each capitation arrangement, and the amount of the capitation.

For the fully-insured, 65 Plus Medicare Advantage Plan, the Proposer shall be liable for adjudicating and paying all claims that are incurred during the Contract Term in accordance with all applicable state and federal rules and the rules set forth by CMS. The A&M System will not be liable for any claims incurred under the 65 Plus Medicare Advantage Plan only the fully-insured premiums.

3.6 Annual Experience Accounting

Within 90 days after the end of each Contract Year, the Respondent shall provide the A&M System with a complete accounting of the financial experience under the Contract. The accounting shall include detail regarding monthly enrollment, paid claims and administrative fees.

In addition, the Respondent shall provide the A&M System with any other experience data and accounting information that the System may reasonably require.

3.7 Actuarial Reporting

The Respondent shall submit to the A&M System and their consulting actuary, at a minimum, on a monthly basis a detailed file including all claims processed during the previous calendar month. This data will be used to analyze claims experience and reconcile invoices. The files and all information contained in the files

The Texas A&M University System RFP-01-SBA-26-274 Page 14 of 67 will be the property of the A&M System. The A&M System and their consulting actuary will agree not to disclose confidential provider discount information to any other party. The vendor shall not require an indemnification provision. The detailed claim file will include but will not be limited to paid date, date of service, provider of service, service provided, line charge, allowable amount, plan payment and patient share. This file will be due no later than the 15th of the month for the previous month’s claim payments.

3.8 Claims Run-Off

Following termination of the contract for any reason, the Respondent must continue to be responsible for processing and paying claims which were incurred during the term of the contract. The cost of such run-off administration should be accounted for in the proposed administrative fee and premium rates. The A&M System will not incur additional administrative fees during the run-off period. The current contracting vendor is responsible for processing and payment of all claims incurred prior to September 1, 2026 for the self-insured A&M Care Plans and January 1, 2027 for the full-insured 65 Plus Medicare Advantage Plan.

3.9 Healthcare Management Performance Incentive

Under the contract for the self-insured A&M Care Plans, the Respondent will have an incentive for the efficient and cost-effective management of health care provided to participants. The Respondent will be charged a penalty if Actual Claims are more than 102% of Target Claims. This incentive is not an insurance or reinsurance arrangement. The contract will not include either specific or aggregate stop loss coverage.

A Respondent's ability to provide a cost-effective network is best evaluated on the basis of the Target Claims level to which the Respondent is willing to commit. Accordingly, the proposed Target Claims Cost will be an important factor in the evaluation process.

3.9.1 Incentive

1) The Proposal must include a Target Claim Cost (TCC). The TCC will include both network and non-network claims expected to be incurred during the fiscal year. Retirees over age 65 for whom Medicare is primary will not be included in the determination of the health care management incentive. Costs associated with the A&M Care Prescription Drug Plans (PDP) are not a part of the TCC determination.

2) The TCC will be expressed as an amount per Employee/Retiree per month as specified in the Price Proposal Worksheet.

3) The TCC for FY2027 (September 1, 2026 – August 31, 2027) will be calculated and finalized on or before February 1, 2027, based on a specified, guaranteed formula submitted in the Proposal and accepted by the A&M System along with the actual claims experience for FY2026 as determined using data available through November 30, 2026. A provision accounting for incurred, but unpaid FY2026 claims as of November 30, 2026, will be established through good faith negotiations.

4) The formula referenced in (3) must be specified in the Price Proposal Worksheet, although it may take into account the actual FY2026 claims experience, FY2027 enrollment data available through November 30, 2026, and the anticipated impact of benefit design or eligibility changes implemented for FY2027, if any. Enrollment variables may recognize the following changes in composition: (a) relative proportion of the enrollment in the various employee/dependent categories, (b) age distribution, (c) gender distribution, and (d) geographic distribution. The manner in which the variability in these factors will be recognized must be clearly specified. The anticipated impact of any benefit design or eligibility changes will be determined through good faith negotiations.

5) All locations will be combined for the purpose of determination of the TCC and the ultimate calculation of the gain or loss.

6) The Target Claims for FY2027 will be equal to the sum of the products obtained by multiplying each

The Texas A&M University System RFP-01-SBA-26-274 Page 15 of 67 month’s actual enrollment by the TCC determined above. As noted in 1) above, retirees over age 65 for whom Medicare is primary will not be included.

7) The A&M System recognizes that a certain degree of variability in claims experience is inevitable and beyond the influence of the vendor. Accordingly, the A&M System provides that should Actual Claims fall within 102% of Target Claims no penalty will be assessed under the Health Care Management Incentive.

8) The Actual Claims for FY2027 will be determined based on claims incurred through August 31, 2027, using actual claims paid through February 28, 2028. A provision accounting for incurred, but unpaid FY2027 claims as of February 28, 2028, will be determined through good-faith negotiation.

9) The loss for the year will be determined through comparison of Target Claims and Actual Claims calculated as described herein.

10) Should Actual Claims exceed 102% of Target Claims, the vendor will be assessed a penalty equal to 100% of the excess subject to a maximum of 2.0% of target claims per Fiscal Year.

Independent determinations will be made for each year of the Contract following similar procedures as described herein.

The table in Section 3.9.3 below presents a tabular display of the requested health care management incentive structure.

3.9.2 Renewal Year Target Claim Cost

In addition to submission of a formula with guaranteed factors for FY2027, the Respondent must also submit a formula for determination of the TCC for the second and third years of the Contract in the Price Proposal Worksheet. While such a formula may take into consideration actual claims, actual enrollment, and the anticipated impact of any benefit design or eligibility changes that may be implemented in the second and/or third years, it must guarantee the maximum trend factors that will be utilized in developing second and third year TCC.

The actual trend factors used for renewal year TCC will be determined through good faith negotiation subject to the guaranteed maximum. The anticipated impact of any benefit design or eligibility changes effective for the second and third years of the contract will be determined through good faith negotiation.

Any benefit design or eligibility changes occurring after the TCC has been established for a given year will result in a revision to the TCC as determined through good faith negotiation.

3.9.3 Table and Examples

The following table displays the health care management incentive arrangement. Several example calculations of the incentive amount are included following the table.

Health Care Management Incentive Arrangement

Actual Claims Range Relative Share of Loss1

In the Actual Claims Range

Maximum Penalty to Vendor

A&M System

Respond ent

100%-102% of Target Claims 100% 0% 0

102%-105% of Target Claims 0 100% 2.0% of Target

Claims

The Texas A&M University System RFP-01-SBA-26-274 Page 16 of 67

1Gain (Loss) = Target Claims – Actual Claims

3.10 Pharmaceutical Information

One hundred percent (100%) of all rebates and other revenue received from a pharmaceutical manufacturer in connection with paid claims will be credited to the A&M System. Respondent shall provide a quarterly statement identifying all rebates and other revenues billed to a pharmaceutical manufacturer.

The statement shall also include any amounts actually received from a pharmaceutical manufacturer associated with each amount billed. Payment of rebates and other revenues will be provided to the A&M System on the basis of an identified credit to a daily claim bill.

Upon executing appropriate nondisclosure agreements, the Respondent shall permit the A&M Systems’ independent auditor to view the actual pharmaceutical manufacturer’s rebate contract and verify the proper billing and receipt of rebate dollars.

Payment of the rebates and other revenues shall not impact the Administrative Fee provided.

3.11 Contract Documents

According to the schedule stated in Section 1.9, the awarded Respondent will provide a first draft of the Administrative Services Agreement and Medicare Advantage Group Administration agreement between both parties, the HIPAA Business Associate Agreement (draft provided in Exhibit F), and any other required legal documentation to the appropriate A&M System Benefits Administration point of contact in electronic format (preferably MS WORD) for review and edits. In addition to the standard terms and conditions included in your Administrative Services Agreement and Medicare Advantage Group Administration Agreement, the selected Respondent must also include the required terms and conditions stated in Section 5.L.

Submission and completion of these documents is not required as part of the RFP response.

3.12 Eligibility

Newly eligible employees have a 31-day enrollment period. Depending upon the date the employee enrolls online or submits an enrollment form, coverage may begin as early as the date of hire, or as late as the first of the month following the 60th day after the hire date.

The A&M System will, in all cases, determine eligibility for coverage and effective dates of coverage in accordance with its rules and procedures. If these rules and procedures differ from those normally utilized by the Respondent, it is understood that the A&M System’s determination will prevail.

Currently, an employee and his/her dependents are eligible for benefits if he/she is one of the following:

a. eligible to participate in the Teacher Retirement System of Texas (TRS) or Optional Retirement Program (ORP), and the employee is either: (1) expected to work at least 20 hours per week and to continue in the employment for a term of at least 4-1/2 months; or (2) appointed for at least 50 percent of a standard full-time appointment.

OR, the employee is employed at least 20 hours a week; and is not permitted to be a member of the Teacher Retirement System of Texas because the individual is solely employed by the system in a position that as a condition of employment requires the individual to be enrolled as a student in the system in graduate-level courses.

b. a retired employee who has met the eligibility requirements for retirement under Texas Insurance Code, Chapter 1601.102

The Texas A&M University System RFP-01-SBA-26-274 Page 17 of 67

Dependents eligible for coverage include:

a. the employee’s spouse

b. the employee’s children younger than age 26, regardless of where they live or whether they are enrolled in school; or disabled dependent children over the age of 26

c. grandchildren claimed on the employee’s/retiree’s income tax

Other categories of individuals eligible for coverage include COBRA participants, survivors, and postdoctoral fellows as described in Texas Insurance Code, Chapter 1601.

3.13 Communications and Enrollment

The A&M System will conduct an open enrollment period for its eligible employees and retirees from July 10 through July 31, for the plan year beginning the following September 1. Between fifteen and twenty voluntary open enrollment meetings are held across the state and the selected Respondent will be required to have personnel available to make presentations at all meetings, if requested to do so. A supplemental file listed in Exhibit E named Sample Open Enrollment Meeting Calendar contains a copy of the July 2025 open enrollment meeting calendar provided for your reference. SBA will produce a booklet summarizing the benefit plans, and employees will make benefit selections using the A&M System’s enrollment process.

Over 80% of open enrollment benefit selections are done online by employees and retirees.

The A&M System will require the selected Respondent to distribute identification cards and additional new member information to employees’ and retirees’ homes. Costs associated with this process must be included in your proposal. All employee communication materials must be reviewed by SBA prior to release.

On a weekly basis throughout the year, the A&M System will report new employees who have enrolled in the plan. Identification cards and new member information should be mailed to home addresses as soon as enrollment information is received.

The A&M System will make personnel available during normal business hours to respond to inquiries regarding the status or eligibility of a participant.

3.14 Qualifications of Respondents

The Respondent must have a net worth of at least $250 million, as demonstrated by an audited financial statement as of the close of the Respondent’s most recent fiscal year.