HFS P98823 UPP CO Extension Request PBM Participation.pdf

Change Order Request for Participation or Piggyback Contract

State of Illinois Chief Procurement Office General Services Change Order Request for Participation or Piggyback Contract v.25.1 Page 1 of 4

Section I - General Information

Requesting Agency HFS - Health and Family Services

Project Title Medicaid Enterprise Systems - Pharmacy Benefit Services

Name of Cooperative Medicaid Enterprise Systems - Pharmacy Benefit Services

Name of Vendor Gainwell Technologies LLC

Initial Term of Agency Contract 7/1/2026 - 10/28/2026 Initial Value $8,517,199.00

Purchase Method Participation Agency BidBuy PO# 26-478HFS-MEDPR-P-98823 Agency Change

Order Req #

27-478HFS-MEDPR-

R-335206

Section II - Change Order Information

1. Provide the original contract description:

The Illinois Department of Healthcare and Family Services (HFS) requires a comprehensive Pharmacy Benefit Management (PBM) solution to support the administration of its Medicaid pharmacy program. The requested services include an integrated, end-to-end platform that manages all core pharmacy operations, ensuring compliance with federal and State requirements while supporting efficient, high-quality service delivery. The scope of services includes, but is not limited to:

• Pharmacy Benefit Administrative Services (PBAS): Real-time point-of-sale (POS) claims adjudication operating 24/7/365; prior authorization processing (automated and manual); provider, member, and prescriber support through a contact center; web-based portals; and financial management functions including payment file generation and reconciliation.

• Pharmacy Drug Rebate Services (PDRS): Administration of federal, supplemental, and state-specific drug rebates; invoicing and collections; dispute resolution; rebate accounting; and support for Preferred Drug List (PDL) management and rebate negotiations.

• Clinical Management Services (PCMS): Development and administration of clinical programs, including Drug Utilization Review (DUR), prior authorization criteria, clinical analytics, advisory board support (e.g., P&T Committee), and ongoing clinical program evaluation.

• Fraud, Waste, and Abuse (FWA): Advanced analytics, auditing, and investigative support to identify and prevent improper payments, including claim reviews, pharmacy audits, and referral support to State oversight entities.

• Reporting and Analytics: Comprehensive reporting capabilities to support operational oversight, federal and State reporting (e.g., CMS-64, DUR reports), performance monitoring, and data-driven decision-making.

• Technical Infrastructure and Security: A secure, highly available, cloud-based system environment with multiple environments (development through production), robust disaster recovery and business continuity capabilities, and compliance with applicable security standards (e.g., SOC 1 Type II, NIST, HIPAA).

• Integration and Interfaces: Support for industry-standard electronic data interchange (EDI) transactions and batch interfaces, including eligibility, claims, rebate data, and coordination of benefits.

The solution must support Illinois-specific program requirements, integrate with existing State systems and data sources, and provide scalability, configurability, and high system availability. The vendor must also provide staffing, training, and operational support necessary to ensure successful implementation and ongoing operations.

This comprehensive PBM solution is critical to ensuring timely access to pharmacy services for Medicaid members, maintaining regulatory compliance, and supporting the State’s financial and clinical oversight responsibilities.

2. Provide a detailed description and explanation for the change required:

The proposed modifications are necessary to ensure continued alignment with statewide procurement requirements and to uphold the objectives of the Pharmacy Program. First, the term of Illinois’ Participating Addendum will be extended to coincide with the NASPO Master Agreement, which has been formally extended through October 28, 2027. Aligning these contract periods preserves continuity and ensures uninterrupted access to the goods and services governed by the agreement.

Change Order Request for Participation or Piggyback Contract v.25.1 Page 2 of 4

Second, the Agency is implementing its formal Change Management (CM) process in accordance with the executed Participating Addendum (PA) P-98823, which will include establishing a pool of funds with a defined, annual, not-to-exceed amount. This CM process will provide a controlled and transparent mechanism to support authorized Change Requests (CR) and solution enhancements as defined by the PA. By incorporating this structure, the Agency can efficiently manage updates while ensuring that all modifications remain fully aligned with Illinois-specific operational needs and regulatory requirements.

The Change Management process was introduced under the NASPO Master Contract (Attachment C, Common Scope Requirements and Security Standards, Sections 2.5 and 2.6) and further solidified in the subsequent Illinois Participating Addendum (B.2.4.3. i. & Illinois Project Management Plan, Sections 4.5.1, 4.5.2, 4.5.3, 4.5.4, and Section 6). All Change Requests will be invoiced in accordance with the Rate Cards established in Attachment C, Illinois Specific Pricing of the Illinois Participating Addendum.

HFS has received the following draft Change Requests:

CR 180 Member & Eligibility Custom Data Layout / PBM Point of Sale (POS); Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.1.19, Ensure correct Claims processing for members based on rules as defined by the State (e.g., Members enrolled in a lock-in program, copay updates). Proposed Solution: Vendor shall Create mappings and ETL transformations using SSIS packages to map the member eligibility data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 322 / Total Estimated Cost: $54,618.00

CR 251 Provider Custom Data Layout / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.2.35, Utilize Provider enrollment information provided by the State. Proposed Solution: Vendor shall create mappings and ETL transformations using Databricks packages to map the provider data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 240 / Total Estimated Cost $33,729.00

CR 493 Claims Custom Data Layout / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.1.1., Work with the State, Providers, and other key stakeholders to maintain a claims processing environment that meets the current and future needs of these stakeholders to comply with HIPAA and any other applicable new and revised rules that may be adopted by the Centers for Medicare and Medicaid Services (CMS) and other federal and state partners. Proposed Solution:

Vendor shall create mappings and ETL transformations using Databricks packages to map the claims data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 282 / Total Estimated Cost $38,988.00

CR 495 Voucher Payment Interface / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 5.1.1.b, Performing reconciliation of pharmacy payments, accounts receivable, and management of agency funds.

Proposed Solution: Vendor shall create mappings and ETL transformations using Databricks packages to map the voucher file data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 113 / Total Estimated Cost $15,384.00 Total estimated cost of Change Requests received to date: $142,719.00

The Agency approved the Change Management Process provided by Gainwell Technologies, as part of the Project Management Plan deliverable, to ensure that all modifications/changes/enhancements to the IL HFS PBM project are evaluated, approved, and implemented in a structured, transparent, and compliant manner. This process is critical to maintaining program integrity, managing risk, and ensuring alignment with federal, State, and contractual requirements. Under Sections 4.5.1–4.5.4 of the Project Management Plan (PMP), the Change Management framework provides a disciplined and traceable method for identifying, evaluating, approving, implementing, and monitoring changes throughout the project lifecycle. This governance structure is necessary due to the complex, regulated nature of Medicaid program functions and the need to maintain strict adherence to scope, schedule, cost, quality, and federal compliance standards. The Change Control Board (CCB) serves as the formal authorization body responsible for ensuring that each

Change Order Request for Participation or Piggyback Contract v.25.1 Page 3 of 4 proposed change receives comprehensive impact analysis across technical, operational, financial, risk, and contractual dimensions. This rigorous review is essential to prevent unauthorized scope expansion, mitigate downstream risks, and promote informed decision-making across all stakeholders. The Office of Procurement Management will maintain a seat on the CCB to ensure that any CRs which may be considered outside of the project scope are reviewed and procured as necessary in accordance with the State of Illinois Procurement Code and associated Rules.

This contract shall consist of two (2) payment mechanisms: 1) Change Requests, which are tied to the above mentioned Change Management Process and 2) Milestones, a Milestone based contract is one where the vendor payments are tied to the completion and acceptance of specific, predefined deliverables or “milestones.” Each milestone represents a meaningful phase or output of the project, and payment is released only when the agency verifies that the milestone has been fully completed according to contractual requirements. Pricing Schedule C has been updated to reflect the Milestone Payment Schedule. Given the complexity of this project, the number of integrated work-streams, and the regulatory oversight involved, the Change Management Process, the CCB governance and Milestones structure are essential tools for maintaining control over project execution. Adoption of these frameworks ensures that the Agency can effectively oversee vendor activities, manage evolving program needs, and verify that all approved changes remain consistent with State priorities, federal regulations, and established project baselines.

Additionally, the PBM project is subject to enhanced financial oversight due to its federal funding structure. The Design, Development, and Implementation (DDI) phase is funded at a 90% Federal / 10% State cost share, while the Maintenance and Operations (M&O) phase is funded at a 75% Federal / 25% State split. Because federal funds represent the majority share of project costs, all invoicing, payment processing, and supporting documentation must withstand multiple layers of review and scrutiny to ensure compliance with federal claiming requirements, cost allocation rules, and audit standards. This additional scrutiny includes dedicated Independent Validation and Verification (IVV) and Project Management Quality Assurance Teams. This heightened oversight necessitates rigorous change management, detailed invoice substantiation, and strict adherence to approved processes throughout the life of the contract.

Total Not to Exceed Request for Change Management for this extension: 1,410,000.00 Total Not to Exceed Request for DDI/M&O for this extension: $16,816,128.00 Total cost of PBM Services for this extension: $18,226,128.00

3. The completion date will be extended, shortened or remain the same.

3.1 Revised Completion Date Oct 28, 2027

4. The Cost will be increased, decreased or remain the same.

4.1 Revised cost $18,226,128.00

5. The circumstances said to necessitate this change was not reasonably foreseeable at the time the contract was signed.

Yes No The change is germane to the original contract as signed.

Yes No

APPROVAL SIGNATURES

Agency Purchasing Officer Approval I know and understand the contents of this Change Order Request and attest that all statements are true and correct.

APO Signature

Printed Name Monique Wantland Date Oct 8, 2026

Change Order Request for Participation or Piggyback Contract v.25.1 Page 4 of 4

State Purchasing Officer Recommendation Based on my review of the provided information, I agree with the requested change(s) for the following reason(s):

Extension of a competitively sources contract will provide uninterrupted usage for the agency.

SPO Signature

Printed Name Jennifer Klein Date Oct 8, 2026

Unified Procurement Program Review and Recommendation Based on my review of the provided information, it is in the best interests of the State to allow the requested change(s) to the existing contract for the following reason(s):

These changes are within the scope of the master contract, original request, and the HFS contract. The changes are required to maintain compliance with the complex Federal requirements that must be followed in order for the State to seek the 90% reimbursement tied to system development and the 75% reimbursement tied to ongoing maintenance and operation.

UPP Representative's Signature

Printed Name Joshua Sergent Date Oct 8, 2026

Chief Procurement Officer Approval Based on my review of the provided information, I determine it is in the best interests of the State to allow the requested change(s) to the contract for the following reason(s):

amendment changes within the scope of the master contract and HFS contract, and allow the agency to maintain compliance with Federal requirements.

Chief Procurement Officer's Signature

Printed Name Ellen H. Daley Date Oct 20, 2026

State of Illinois Chief Procurement Office General Services Change Order Request for Participation or Piggyback Contract v.25.1 Page of Section I - General Information Section II - Change Order Information

1. Provide the original contract description:

2. Provide a detailed description and explanation for the change required:

3. The completion date will be

4. The Cost will be

5. The circumstances said to necessitate this change was not reasonably foreseeable at the time the contract was signed.

The change is germane to the original contract as signed.

APPROVAL SIGNATURES

Agency Purchasing Officer Approval I know and understand the contents of this Change Order Request and attest that all statements are true and correct.

State Purchasing Officer Recommendation Based on my review of the provided information, with the requested change(s) for the following reason(s):

Unified Procurement Program Review and Recommendation Based on my review of the provided information, in the best interests of the State to allow the requested change(s) to the existing contract for the following reason(s):

Chief Procurement Officer Approval Based on my review of the provided information, I determine in the best interests of the State to allow the requested change(s) to the contract for the following reason(s):

6.5.0.20190320.2.935878.932721

• Pharmacy Benefit Administrative Services (PBAS): Real-time point-of-sale (POS) claims adjudication operating 24/7/365; prior authorization processing (automated and manual); provider, member, and prescriber support through a contact center; web-based portals; and financial management functions including payment file generation and reconciliation.

• Pharmacy Drug Rebate Services (PDRS): Administration of federal, supplemental, and state-specific drug rebates; invoicing and collections; dispute resolution; rebate accounting; and support for Preferred Drug List (PDL) management and rebate negotiations.

• Clinical Management Services (PCMS): Development and administration of clinical programs, including Drug Utilization Review (DUR), prior authorization criteria, clinical analytics, advisory board support (e.g., P&T Committee), and ongoing clinical program evaluation.

• Fraud, Waste, and Abuse (FWA): Advanced analytics, auditing, and investigative support to identify and prevent improper payments, including claim reviews, pharmacy audits, and referral support to State oversight entities.

• Reporting and Analytics: Comprehensive reporting capabilities to support operational oversight, federal and State reporting (e.g., CMS-64, DUR reports), performance monitoring, and data-driven decision-making.

• Technical Infrastructure and Security: A secure, highly available, cloud-based system environment with multiple environments (development through production), robust disaster recovery and business continuity capabilities, and compliance with applicable security standards (e.g., SOC 1 Type II, NIST, HIPAA).

• Integration and Interfaces: Support for industry-standard electronic data interchange (EDI) transactions and batch interfaces, including eligibility, claims, rebate data, and coordination of benefits.

The solution must support Illinois-specific program requirements, integrate with existing State systems and data sources, and provide scalability, configurability, and high system availability. The vendor must also provide staffing, training, and operational support necessary to ensure successful implementation and ongoing operations.

This comprehensive PBM solution is critical to ensuring timely access to pharmacy services for Medicaid members, maintaining regulatory compliance, and supporting the State’s financial and clinical oversight responsibilities.

TextField9: The proposed modifications are necessary to ensure continued alignment with statewide procurement requirements and to uphold the objectives of the Pharmacy Program. First, the term of Illinois’ Participating Addendum will be extended to coincide with the NASPO Master Agreement, which has been formally extended through October 28, 2027. Aligning these contract periods preserves continuity and ensures uninterrupted access to the goods and services governed by the agreement.

Second, the Agency is implementing its formal Change Management (CM) process in accordance with the executed Participating Addendum (PA) P-98823, which will include establishing a pool of funds with a defined, annual, not‑to‑exceed amount. This CM process will provide a controlled and transparent mechanism to support authorized Change Requests (CR) and solution enhancements as defined by the PA. By incorporating this structure, the Agency can efficiently manage updates while ensuring that all modifications remain fully aligned with Illinois‑specific operational needs and regulatory requirements.

The Change Management process was introduced under the NASPO Master Contract (Attachment C, Common Scope Requirements and Security Standards, Sections 2.5 and 2.6) and further solidified in the subsequent Illinois Participating Addendum (B.2.4.3. i. & Illinois Project Management Plan, Sections 4.5.1, 4.5.2, 4.5.3, 4.5.4, and Section 6). All Change Requests will be invoiced in accordance with the Rate Cards established in Attachment C, Illinois Specific Pricing of the Illinois Participating Addendum.

HFS has received the following draft Change Requests:

CR 180 Member & Eligibility Custom Data Layout / PBM Point of Sale (POS); Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.1.19, Ensure correct Claims processing for members based on rules as defined by the State (e.g., Members enrolled in a lock-in program, copay updates). Proposed Solution: Vendor shall Create mappings and ETL transformations using SSIS packages to map the member eligibility data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 322 / Total Estimated Cost: $54,618.00

CR 251 Provider Custom Data Layout / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.2.35, Utilize Provider enrollment information provided by the State. Proposed Solution: Vendor shall create mappings and ETL transformations using Databricks packages to map the provider data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 240 / Total Estimated Cost $33,729.00

CR 493 Claims Custom Data Layout / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 3.1.1., Work with the State, Providers, and other key stakeholders to maintain a claims processing environment that meets the current and future needs of these stakeholders to comply with HIPAA and any other applicable new and revised rules that may be adopted by the Centers for Medicare and Medicaid Services (CMS) and other federal and state partners. Proposed Solution: Vendor shall create mappings and ETL transformations using Databricks packages to map the claims data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for conversion (to create Day 0 data) and for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 282 / Total Estimated Cost $38,988.00

CR 495 Voucher Payment Interface / PBM Point of Sale (POS); NASPO Attachment F, Pharmacy Benefit Administrator Services Scope of Work Requirement 5.1.1.b, Performing reconciliation of pharmacy payments, accounts receivable, and management of agency funds. Proposed Solution: Vendor shall create mappings and ETL transformations using Databricks packages to map the voucher file data from the client provided custom formats to Gainwell target tables. These mappings and transformations will be used for interfaces (to exchange Day 1 and onwards data).

Total Hours Required: 113 / Total Estimated Cost $15,384.00 Total estimated cost of Change Requests received to date: $142,719.00

The Agency approved the Change Management Process provided by Gainwell Technologies, as part of the Project Management Plan deliverable, to ensure that all modifications/changes/enhancements to the IL HFS PBM project are evaluated, approved, and implemented in a structured, transparent, and compliant manner. This process is critical to maintaining program integrity, managing risk, and ensuring alignment with federal, State, and contractual requirements. Under Sections 4.5.1–4.5.4 of the Project Management Plan (PMP), the Change Management framework provides a disciplined and traceable method for identifying, evaluating, approving, implementing, and monitoring changes throughout the project lifecycle. This governance structure is necessary due to the complex, regulated nature of Medicaid program functions and the need to maintain strict adherence to scope, schedule, cost, quality, and federal compliance standards. The Change Control Board (CCB) serves as the formal authorization body responsible for ensuring that each proposed change receives comprehensive impact analysis across technical, operational, financial, risk, and contractual dimensions. This rigorous review is essential to prevent unauthorized scope expansion, mitigate downstream risks, and promote informed decision‑making across all stakeholders. The Office of Procurement Management will maintain a seat on the CCB to ensure that any CRs which may be considered outside of the project scope are reviewed and procured as necessary in accordance with the State of Illinois Procurement Code and associated Rules.

This contract shall consist of two (2) payment mechanisms: 1) Change Requests, which are tied to the above mentioned Change Management Process and 2) Milestones, a Milestone based contract is one where the vendor payments are tied to the completion and acceptance of specific, predefined deliverables or “milestones.” Each milestone represents a meaningful phase or output of the project, and payment is released only when the agency verifies that the milestone has been fully completed according to contractual requirements. Pricing Schedule C has been updated to reflect the Milestone Payment Schedule. Given the complexity of this project, the number of integrated work-streams, and the regulatory oversight involved, the Change Management Process, the CCB governance and Milestones structure are essential tools for maintaining control over project execution. Adoption of these frameworks ensures that the Agency can effectively oversee vendor activities, manage evolving program needs, and verify that all approved changes remain consistent with State priorities, federal regulations, and established project baselines.

Additionally, the PBM project is subject to enhanced financial oversight due to its federal funding structure. The Design, Development, and Implementation (DDI) phase is funded at a 90% Federal / 10% State cost share, while the Maintenance and Operations (M&O) phase is funded at a 75% Federal / 25% State split. Because federal funds represent the majority share of project costs, all invoicing, payment processing, and supporting documentation must withstand multiple layers of review and scrutiny to ensure compliance with federal claiming requirements, cost allocation rules, and audit standards. This additional scrutiny includes dedicated Independent Validation and Verification (IVV) and Project Management Quality Assurance Teams. This heightened oversight necessitates rigorous change management, detailed invoice substantiation, and strict adherence to approved processes throughout the life of the contract.

Total Not to Exceed Request for Change Management for this extension: 1,410,000.00 Total Not to Exceed Request for DDI/M&O for this extension: $16,816,128.00 Total cost of PBM Services for this extension: $18,226,128.00