Medical Claims Audit RFP Final.pdf

STATE OF NORTH CAROLINA

STATE HEALTH PLAN FOR TEACHERS AND STATE EMPLOYEES

Request for Proposal #: 270-20250414MCA

MEDICAL CLAIMS AUDIT – OPERATION SERVICES

Date of Issue: April 14, 2025

Proposal Opening Date: May 16, 2025

At 10:00 AM ET

Direct all inquiries concerning this RFP to:

Email: Kimberly.Alston@nctreasurer.com SHPContracting@nctreasurer.com

Phone: 919-814-4429

Sealed, mailed responses ONLY will be accepted for this solicitation

Ariba System Generated Solicitation #: 1534198159 mailto:Sharon.Smith@nctreasurer.com mailto:SHPContracting@nctreasurer.com

Proposal Number: 270-20250414MCA Vendor: __________________________________________

Request for Proposal #

270-20250414MCA

For internal State agency processing, including tabulation of Proposals, provide Your company’s Electronic Vendor Portal (eVP) Number. Pursuant to G.S. 132-1.10(b), this identification number shall not be released to the public.

To prevent such release, Vendor shall ensure confidential information on this page is redacted when submitting redacted versions of this document in accordance with the instructions herein.

This page shall be filled out and returned with Your Proposal.

Failure to do so may subject Your proposal to rejection.

Vendor Name

Vendor eVP#

Note: For a Contract to be awarded to You, Your company (You) must be a North Carolina registered Vendor in good standing. You must enter the vendor number assigned through eVP. If You do not have a vendor number, register at https://evp.nc.gov/

Sealed, mailed responses ONLY will be accepted for this solicitation.

https://evp.nc.gov/

Proposal Number: 270-20250303ACT Vendor: __________________________________________

Refer ALL Inquiries regarding this RFP to:

Kimberly Alston, Contracting Agent Kimberly.Alston@nctreasurer.com

Request for Proposal #: 270-20250414MCA Proposals will be publicly opened: May 16, 2025, 10:00 AM ET

Using Agency: The North Carolina State Health Plan for Teachers and State Employees

Commodity No. and Description:

841116 – Medical Claims Audit Services

Requisition No.: N/A

EXECUTION

In compliance with this RFP, and subject to all the conditions herein, the undersigned Vendor offers and agrees to furnish and deliver any or all items upon which prices are bid, at the prices set opposite each item within the time specified herein.

By executing this Proposal, the undersigned Vendor understands that false certification is a Class I felony and certifies that:

this Proposal is submitted competitively and without collusion, none of its officers, directors, or owners of an unincorporated business entity have been convicted of any violations of Chapter 78A of the General Statutes, the Securities Act of 1933, or the Securities Exchange Act of 1934, and it is not an ineligible Vendor as set forth in G.S. 143-59.1.

Furthermore, by executing this Proposal, the undersigned certifies to the best of Vendor’s knowledge and belief, that:

it and its principals are not presently debarred, suspended, proposed for debarment, declared ineligible or voluntarily excluded from covered transactions by any federal or state department or agency.

As required by G.S. 143-48.5, the undersigned Vendor certifies that it, and each of its subcontractors for any Contract awarded as a result of this RFP, complies with the requirements of Article 2 of Chapter 64 of the NC General Statutes, including the requirement for each employer with more than 25 employees in North Carolina to verify the work authorization of its employees through the federal E-Verify system.

As required by Executive Order 24 (2017), the undersigned Vendor certifies will comply with all federal and state requirements concerning fair employment and that it does not and will not discriminate, harass, or retaliate against any employee in connection with performance of any Contract arising from this solicitation.

G.S. 133-32 and Executive Order 24 (2009) prohibit the offer to, or acceptance by, any State Employee associated with the preparing plans, specifications, estimates for public contracts; or awarding or administering public contracts; or inspecting or supervising delivery of the public contract of any gift from anyone with a contract with the State, or from any person seeking to do business with the State. By execution of this response to the RFP, the undersigned certifies, for the Vendor’s entire organization and its employees or agents, that the Vendor is not aware that any such gift has been offered, accepted, or promised by any employees of Your organization.

By executing this proposal, the Vendor certifies that it has read and agreed to the INSTRUCTION TO VENDORS and the GENERAL TERMS AND CONDITIONS incorporated herein. These documents can be accessed from the ATTACHMENTS section within this document.

Failure to execute/sign proposal prior to submittal may render proposal invalid and it MAY BE REJECTED. Late proposals shall not be accepted.

COMPLETE/FORMAL NAME OF VENDOR:

STREET ADDRESS: P.O. BOX: ZIP:

CITY & STATE & ZIP: TELEPHONE NUMBER: TOLL FREE TEL. NO:

PRINCIPAL PLACE OF BUSINESS ADDRESS IF DIFFERENT FROM ABOVE (SEE INSTRUCTIONS TO VENDORS ITEM #21):

PRINT NAME & TITLE OF PERSON SIGNING ON BEHALF OF VENDOR: FAX NUMBER:

VENDOR’S AUTHORIZED SIGNATURE*: DATE: EMAIL:

Department of State Treasurer, State Health Plan Division

VALIDITY PERIOD

Offer shall be valid for at least 180 days from date of bid opening, unless otherwise stated here: ______ days, or if extended by mutual agreement of the Parties in writing. Any withdrawal of this offer shall be made in writing in accordance with the instructions herein.

ACCEPTANCE OF PROPOSAL

If Your Proposal is accepted, as described in more detail in Section 4.14 Contract Documents, all provisions of this RFP, along with the written results of any negotiations, shall constitute the written agreement between the Parties. This Contract is not binding until the Plan’s Executive Administrator has signed this Acceptance of Proposal.

FOR STATE USE ONLY: Offer accepted and Contract awarded this________ day of __________, 2025, as indicated on the attached certification, by

(Authorized Representative of the NC Department of State Treasurer, State Health Plan Division).

Contents

1.0 PURPOSE AND BACKGROUND

1.1 CONTRACT TERM

2.0 GENERAL INFORMATION

2.1 REQUEST FOR PROPOSAL DOCUMENT

2.2 E-PROCUREMENT FEE

2.3 NOTICE TO VENDORS REGARDING RFP TERMS AND CONDITIONS

2.4 RFP SCHEDULE

2.5 PROPOSAL QUESTIONS

2.6 PROPOSAL SUBMITTAL

2.7 PROPOSAL CONTENTS

2.8 ALTERNATE PROPOSALS - Reserved

2.9 DEFINITIONS, ACRONYMS, AND ABBREVIATIONS

3.0 METHOD OF AWARD AND PROPOSAL EVALUATION PROCESS

3.1 METHOD OF AWARD

3.2 CONFIDENTIALITY AND PROHIBITED COMMUNICATIONS DURING EVALUATION

3.3 PROPOSAL EVALUATION PROCESS

3.4 EVALUATION CRITERIA

3.5 PERFORMANCE OUTSIDE THE UNITED STATES

4.0 REQUIREMENTS

4.1 PRICING

4.2 INVOICES

4.3 FINANCIAL STABILITY

4.4 HUB PARTICIPATION – RESERVED

4.5 VENDOR EXPERIENCE - RESERVED

4.6 REFERENCES

4.7 BACKGROUND CHECKS

4.8 PERSONNEL

4.9 VENDOR’S REPRESENTATIONS

4.10 QUESTIONS TO VENDORS - RESERVED

4.11 AGENCY INSURANCE REQUIREMENTS MODIFICATION

4.12 ADMINISTRATORS FOR THE CONTRACT

4.13 CONFIDENTIALITY AND PROTECTION OF PROPRIETARY INFORMATION

4.14 CONTRACT DOCUMENTS

4.15 DATA OWNERSHIP

4.16 CONFLICT OF INTEREST

4.17 VENDOR’S REPRESENTATIVE

4.18 DEBARRED, SUSPENDED OR EXCLUDED VENDORS

4.19 REGISTRATION AND CERTIFICATION

4.20 PERFORMANCE GUARANTEES

5.0 SPECIFICATIONS AND SCOPE OF WORK

5.1 MINIMUM REQUIREMENTS

5.2 TASK AND DELIVERABLES

5.2.1 GENERAL INFORMATION

5.3 STANDARD AUDITS

5.4 FOCUSED AUDITS

5.5 ADDITIONAL AUDITS

5.6 AUDIT REPORTS, MEETINGS AND COMMUNICATION

5.7 IMPLEMENTATION……………………………………………………………………………………30

6.0 CONTRACT ADMINISTRATION

6.1 RESERVED

6.2 POST AWARD MEETINGS CADENCE

6.3 CONTINUOUS IMPROVEMENT

6.4 PERIODIC STATUS REPORTS - RESERVED

6.5 ACCEPTANCE OF WORK

6.6 FAITHFUL PERFORMANCE - RESERVED

6.7 TRANSITION ASSISTANCE

6.8 DISPUTE RESOLUTION

6.9 CONTRACT CHANGES

6.10 DELIVERABLES, PERFORMANCE GUARANTEES, AND REDUCTION IN FEES

ATTACHMENT A: COST PROPOSAL

ATTACHMENT B: INSTRUCTIONS TO VENDORS

ATTACHMENT C: GENERAL TERMS AND CONDITIONS

ATTACHMENT D: CUSTOMER REFERENCE TEMPLATE

ATTACHMENT E: LOCATION OF WORKERS UTILIZED BY VENDOR

ATTACHMENT F: CERTIFICATION OF FINANCIAL CONDITION

ATTACHMENT G: PROPOSAL SUBMISSION INFORMATION

ATTACHMENT H: HIPAA QUESTIONNAIRE

ATTACHMENT I: BUSINESS ASSOCIATE AGREEMENT

ATTACHMENT J: ADMINISTRATORS FOR THE CONTRACT, HIPAA COMPLIANCE OFFICER,

AND INFORMATION SECURITY OFFICER

1.0 PURPOSE AND BACKGROUND

PURPOSE

Through this competitive bidding process, the Plan is soliciting Proposals from qualified companies to perform medical claims audits. This RFP has one component of services that will be awarded to one vendor.

Goal and Mission The goal of this RFP is to procure a Vendor to provide Medical Claims Audit Services to include the following:

1. Standard Medical Claims Audits

2. Focused Medical Claims Audits

3. Additional Medical Claims Audits

The Plan requires a Vendor that brings best in class Services and expertise in medical claims auditing with a proven track record of auditing self-funded plans of similar size and complexity. Vendor must be capable of performing a comprehensive and objective review of the claims processed by the Plan’s TPA to determine if claims were adjudicated according to contractual standards, Plan benefits and policies, and industry standards, such as those associated with cost containment and refund procedures.

Proposals shall be submitted in accordance with the terms and conditions of this RFP and any addenda issued hereto.

BACKGROUND

State Health Plan

The Plan provides health benefits coverage to more than 750,000 teachers and school personnel, State employees, retirees, current and former lawmakers, State university and community college personnel, and eligible dependents. The Services outlined in this RFP are focused on the approximately 578,000 self-funded Members. The mission of the State Health Plan is to improve the health and health care of North Carolina teachers, State employees, retirees, and their dependents, in a financially sustainable manner, thereby serving as a model to the people of North Carolina for improving their health and well-being.

Governance

The Treasurer, Executive Administrator, and the Board are designated as fiduciaries for the Plan. The powers and duties of the Treasurer are set forth in statute at N.C.G.S. § 135-48.30(a) and include setting benefits, premium rates, co-pays, deductibles, and coinsurance percentages and maximums subject to approval of the Board. The Board’s powers and duties are set forth at N.C.G.S.

§ 135-22 and include approving large contracts; approving premium rates, copays, and deductibles proposed by the Treasurer;

and developing and maintaining a strategic plan. The North Carolina General Assembly determines member eligibility rules and establishes certain premium levels for the Plan.

The Plan is exempt from the Employee Retirement Income Security Act of 1974 pursuant to 29 U.S.C. § 1003 because it is a self-funded nongovernmental health benefit program established for the benefit of State Employees.

Plan Designs

The Plan currently offers three self-funded Plan Designs. Two are copay-based PPO plans and one is a HDHP. The Plan Designs are evaluated on an annual basis and are likely to change prior to 2026.

Plan Vendors

The Plan contracts with a number of vendors to provide third party administrative, pharmacy benefit management and other related services:

• Aetna Life Insurance Company (“Aetna”) is the contracted TPA for Claims and Related Services for the Plan’s three self-funded plan options.

• Humana, Inc., currently provides the two fully-insured Medicare Advantage Plans.

• Caremark PCS Health, LLC, a subsidiary of CVS Health, provides Pharmacy Benefit Management (“PBM”) Services.

• Benefitfocus is the Plan’s eligibility and enrollment services (“EES”) vendor.

• iTEDIUM provides COBRA administration and billing services.

• Healthcare Horizons is the Plan’s current vendor for medical claims audit services.

A listing of the Plan’s contracted vendors is available at www.shpnc.org, bottom of the page in the footer section, “SHP Contracted Vendors.”

1.1 CONTRACT TERM

The Contract shall have an initial term of forty months, including four months for implementation, beginning September 2, 2025, and lasting through December 31, 2028, with Services commencing on January 1, 2026.

At the end of the Contract’s initial term, the Plan shall have the option, in its sole discretion, to renew the Contract on the same terms and conditions for up to a total of two additional one-year terms beginning January 1, 2029, through December 31, 2029, and January 1, 2030, through December 31, 2030.

The Plan will give the Vendor written notice of its intent to exercise each option no later than thirty days before the end of the Contract’s then-current term. In addition to any optional renewal terms stated herein, and with the Vendor’s concurrence, the State reserves the right to extend the Contract after the last active term; such an extension shall be incorporated into this document through an Amendment.

2.0 GENERAL INFORMATION

2.1 REQUEST FOR PROPOSAL DOCUMENT

This RFP document shall govern the procurement process and, pursuant to the terms herein, becomes the binding Contract between a Vendor who submits a Proposal and the Plan.

2.2 E-PROCUREMENT FEE

ATTENTION: The E-Procurement fee does not apply to this solicitation.

General information on the E-Procurement Services can be found at: http://eprocurement.nc.gov/.

2.3 NOTICE TO VENDORS REGARDING RFP TERMS AND CONDITIONS

It shall be the Vendor’s responsibility to read the Instructions to Vendors, the General Terms and Conditions, all relevant exhibits and attachments, and any other components made a part of this RFP and to comply with all requirements and specifications herein.

Vendors are also responsible for obtaining and complying with all Addenda and other changes that may be issued in connection with this RFP.

If the Vendors have questions or issues regarding any component of this RFP, those must be submitted as questions in accordance with the instructions in Section 2.5 Proposal Questions and, among others, Section III of Attachment B: Instructions to Vendors. If the Plan determines that any changes will be made as a result of the questions asked, then such decisions will be communicated in the form of an Addendum to this RFP. The Plan may also elect to leave open the possibility for later negotiation of specific provisions of the Contract that have been addressed during the question-and-answer period, prior to contract award.

Other than as part of the process of negotiation as outlined by this RFP, the Plan rejects and will not be required to evaluate or consider any additional or modified terms and conditions submitted with Vendor’s proposal or otherwise. This applies to any language appearing in or attached to the document as part of the Vendor’s Proposal that purports to vary any terms and conditions or Vendors’ instructions herein or to render the proposal non-binding or subject to further negotiation. Vendor’s Proposal shall constitute a firm offer that shall be held open for the period required herein (“Validity Period” above).

http://eprocurement.nc.gov/

The Plan may exercise its discretion to consider modifications proposed by Vendors, but only if those modifications are proposed during the question-and-answer period in accordance with Section 2.5 Proposal Questions. By execution and delivery of this RFP Response, Vendor agrees that any additional or modified terms and conditions, whether submitted purposely or inadvertently, shall have no force or effect, and will be disregarded, unless expressly agreed upon through negotiation and incorporated by way of a BAFO. Noncompliance with, or any attempt to alter or delete, this paragraph shall constitute sufficient grounds to reject the Vendor’s proposal as nonresponsive.

2.4 RFP SCHEDULE

The table below shows the intended schedule for this RFP. The State will make every effort to adhere to this schedule.

Event Responsibility Date and Time, if Applicable Issue RFP State April 14, 2025 Deadline for Submission of Written Questions Vendor April 18, 2025, 11:59 PM ET Provide Response to Questions State April 23, 2025 Deadline for Submission of Proposals (Bid Closes) Vendor May 16, 2025, 10:00 AM ET Evaluation Period (Review of Proposals) State May 19-21, 2025 Best and Final Offer (BAFO) State and Vendor May 22-27, 2025 Plan seeks approval from the Plan’s Special Deputy Attorney General to award contract

State May 2025

Award of Contract State May-June 2025 Execution of Contract by the Plan and Vendor State and Vendor May-June 2025 Implementation Period State and Vendor September 2, 2025 – December 31, 2025 Services Begin Vendor January 1, 2026

2.5 PROPOSAL QUESTIONS

Upon review of the RFP documents, Vendors may have questions to clarify or interpret the RFP to enable Vendors to submit the best proposal possible. To accommodate the Proposal Questions process, the Vendors shall submit any such questions by the due date in Section 2.4 RFP Schedule. Questions received after these dates will not receive a response. Failure to resolve any issues about any ambiguity in this RFP by submitting a question according to this timeline waives a Vendor’s objection to any ambiguity that should have been apparent to a reasonable Vendor during the RFP Process. Written questions shall be emailed to Kimberly.Alston@nctreasurer.com with a copy to SHPContracting@nctreasurer.com by the date and time specified above.

Vendors should enter “RFP # 270-20250414MCA: Questions” as the subject for the email. Question submittals should include a reference to the applicable RFP section and be submitted in the table format shown below in sequential order by the section of the RFP to which they relate:

Question # Reference Vendor Question

1. RFP Section, Page Number Vendor question …?

Questions received prior to the submission deadline date in Section 2.4 RFP Schedule, the Plan’s response, and any additional terms deemed necessary by the State will be posted in the form of an Addendum to the electronic Vendor Portal, https://evp.nc.gov, and shall become an Addendum to this RFP. The Plan may also elect to leave open the possibility for later negotiation and amendment of specific provisions of the RFP that have been addressed during the question period.

No information, instruction or advice provided orally or informally by any Plan personnel, whether made in response to a question or otherwise in connection with this RFP, shall be considered authoritative or binding. Vendors shall rely only on written material contained in the RFP and an Addendum to this RFP.

mailto:SHPContracting@nctreasurer.com https://evp.nc.gov/

2.6 PROPOSAL SUBMITTAL

IMPORTANT NOTE: All Proposals shall be physically delivered to the address listed below on or before the Proposal deadline to be considered timely, regardless of the method of delivery. This is an absolute requirement. Late bids, regardless of cause, will not be opened or considered, and will be automatically disqualified from further consideration. The Vendor shall bear the sole risk of late submission due to unintended or unanticipated delay. It is the Vendor’s sole responsibility to ensure its proposal has been received as described in this RFP by the specified time and date of opening. The time and date of receipt will be marked on each proposal when received. Any proposal or portion thereof received after the proposal deadline will be rejected.

The U.S. Postal Service does not deliver mail to a specified street address but to the State’s Mail Service Center. Due to the likelihood of delay in delivery, Vendors are not permitted to utilize the U.S. Postal Service to submit their Proposals. Instead, Vendors must use a different parcel or package delivery service. Moreover, attempts to submit a proposal via facsimile (FAX) machine, telephone, or email in response to this RFP shall NOT be accepted.

Mailing and Office address for delivery of proposal via special delivery, overnight, or any other carrier

PROPOSAL NUMBER: 270-20250414MCA

NC Department of State Treasurer State Health Plan Division 3200 Atlantic Avenue Raleigh, NC 27604

Attention: Kimberly Alston, Contracting Agent

a) Submit, simultaneously to the address identified in the table above, the following: two signed, original executed Technical

Proposal and Cost Proposal responses; five physical copies of each; one physical copy of the Technical Proposal and one physical copy of the Cost Proposal Redacted in accordance with the instructions provided in this RFP; two flash drives, each flash drive having one un-Redacted electronic copy on it; and, if the Vendor desires to provide redactions, one electronic copy on a flash drive, Redacted in accordance with the instructions provided in this RFP. Redacted copies shall exclude any information that is confidential and not subject to disclosure under Chapter 132 of the North Carolina General Statutes, the Public Records Act. All redactions shall be made in BLACK and in accordance with Section V, Paragraph 24 of Attachment B:

Instructions to Vendors.

At the Vendor’s discretion, individual attachments, exhibits, and/or supporting documentation that are greater than fifty pages in length may be submitted in electronic copy instead of being submitted as a physical copy, if the Vendor so chooses.

If a Vendor does so choose, such an electronic copy must be submitted on flash drives. The original and physical copy technical responses must specifically identify the file names and location of the individual attachments, exhibits, and/or supporting documentation submitted in this manner.

b) Submit Your Technical and Cost Proposals in separate sealed packages. Clearly mark each package with: (1) Vendor name; (2) the RFP number; (3) Technical Proposal or Cost Proposal, respectively; and (4) the due date. Address the package(s) for delivery as shown in the table above.

c) For delivery purposes, separate sealed envelopes from a single Vendor may be included in the same outer package. Proposals are subject to rejection unless submitted with the information above included on the outside of the sealed Proposal package.

d) The electronic copies of Your Proposal must be provided on separate read-only flash drives. The files on the flash drives shall NOT be password protected, shall be in .PDF or .XLS format, and shall be capable of being copied to other media including being readable in Microsoft Word and/or Microsoft Excel.

e) Flash Drives One and Two must contain the entire Technical and Cost Proposals, including any proprietary information, and must have the following label affixed to the flash drives: (1) Vendor name; (2) the RFP number; (3) the due date; and (4) the words “Technical and Cost Proposals Non-Redacted.”

f) Flash Drive Three, if required for confidentiality, must contain the Technical and Cost Proposals, excluding any information identified as confidential under the Public Records Act. All redactions shall be made in accordance with Section V, Paragraph 24 of Attachment B: Instructions to Vendors. The Plan, in responding to public records requests, will release the information on this flash drive. The following label must be affixed to the flash drive: (1) Vendor name; (2) the RFP number; (3) the due date; and (4) the words “Technical and Cost Proposal Redacted.”

Failure to submit a proposal in strict accordance with these instructions shall constitute sufficient cause to reject a Vendor’s proposal(s).

The Plan may include critical updated information in Addenda to this RFP. It is important that all Vendors responding to this RFP periodically check the State’s eVP website for any Addenda that may be issued prior to the bid opening date. All Vendors shall be deemed to have read and understood all information in this RFP and all Addenda thereto.

2.7 PROPOSAL CONTENTS

The Vendors shall populate all attachments of this RFP that require the Vendor to provide information and include an authorized signature where requested. Failure to provide all required items, or the Vendor’s submission of incomplete items, may result in the Plan rejecting the Vendor’s proposal, in the Plan’s sole discretion.

Vendor Proposal responses shall:

a) Match the order of the RFP;

b) Include the RFP section and requirement or specification numbers;

c) Include a Table of Contents;

d) Include tabs indexing each section;

e) Be submitted in multiple three (3) ring binders no larger than three (3) inches each; and

f) Include at a minimum the following information: RFP number, RFP title, Proposal title, and the submitting Vendor’s name on the front and side of each binder.

Vendor RFP responses shall include the following items and attachments, which shall be arranged in the following order:

a) Completed and signed version of Attachment G: Proposal Submission Information;

b) Completed and signed version of all EXECUTION PAGES, along with the body of the RFP and signed receipt pages of any addenda released in conjunction with this RFP, if required to be returned. The document must be signed and dated by an official authorized to bind the company. Proposals submitted without the signed and dated Execution Page will not be considered;

c) Minimum Requirements Response, Section 5.1;

d) Technical Requirements Response, Sections 5.3, 5.4, 5.6, and 5.7;

e) Completed version of Attachment A: Cost Proposal;

f) Entire copy of Attachment B: Instructions to Vendors

g) Entire copy of Attachment C: General Terms and Conditions

h) Completed version of Attachment D: Customer Reference Form;

i) Completed version of Attachment E: Location of Workers Utilized By Vendor;

j) Completed and signed version of Attachment F: Certification of Financial Condition;

k) Completed and signed version of Attachment H: HIPAA Questionnaire. Vendors must respond to all questions and request for documentation in the HIPAA Compliance Questionnaire;

l) Completed and signed two originals of Attachment I: Business Associate Agreement; and

m) Completed version of Attachment J: Administrators for the Contract, HIPAA Compliance Officer, and Information Security

Officer.

2.8 ALTERNATE PROPOSALS - Reserved

2.9 DEFINITIONS, ACRONYMS, AND ABBREVIATIONS

a. ADDENDUM: Written Clarification or revision to this RFP issued by the Plan during the procurement process and prior to the close of bid. The terms of an Addendum are incorporated into the resulting Contract. Addendums occur during the procurement process, unlike an Amendment, which occurs once the Contract has been awarded to a Vendor.

b. AMENDMENT: A change to one or more terms of this Contract that is evidenced by a document executed by both Parties. Amendments occur after the Contract has been awarded to a Vendor, unlike an Addendum, which occurs during the procurement process. The terms of an Amendment are incorporated into the Contract.

c. BAFO: Best and Final Offer, submitted by a Vendor to alter its initial offer, made in response to a request by the Plan.

d. BOARD OF TRUSTEES: The Board of Trustees of the State Health Plan for Teachers and State Employees, established by

N.C.G.S. § 135-48.20 and governs the Plan. The Board’s members are appointed by the Governor, the North Carolina General Assembly, and the State Treasurer, and they act as fiduciaries for the Plan in carrying out their duties and responsibilities, which are set forth in law.

e. BUSINESS REQUIREMENTS: The Plan’s needs and expectations that will be memorialized in a Business Requirements Document.

f. BUSINESS REQUIREMENTS DOCUMENT (“BRD”): Document that outlines the Business Requirements for a benefit, program, or process and may include requirements for multiple Plan vendors.

g. CALENDAR YEAR: A twelve-month period which runs from January 1 - December 31.

h. CLARIFICATION: A written response from a Vendor that provides an answer or explanation to a Clarification Question posed by the Plan about that Vendor’s Proposal. Clarifications are incorporated into Vendor’s Proposal response and become a term of the resulting Contract.

i. CLARIFICATION QUESTION: A question from the Plan to a Vendor asking the Vendor to clarify a portion of its response.

j. CONFLICT OF INTEREST: Situations or circumstances through which the Vendor, or entities or individuals closely affiliated with the Vendor, will derive, or reasonably may be perceived as deriving, direct financial or other pecuniary benefit from its performance of this Contract, other than through the compensation received according to the Contract for performance of the Contract, or that might impair, or reasonably be perceived as impairing, the Vendor’s ability to perform this Contract in the best interests of the Plan.

k. CONTRACT: The agreement between the Plan and the Vendor to whom the award is made, as evidenced by the documents outlined in Section 4.14 Contract Documents.

l. CONTRACT ADMINISTRATOR: Representative of the Plan who will administer this Contract for the Plan as detailed in Attachment J. This person has authority to execute Administrative Decision Memos and Business Requirements Documents and may delegate that authority to another representative of the Plan.

m. CONTRACT MANAGER: Representative of the Plan, as identified in Attachment J, who corresponds with potential Vendors regarding this RFP and regarding contractual issues after award of the Contract.

n. DATA CENTER: A facility that performs one or more of the following functions:

• Physically houses various equipment, such as computers, servers (e.g., web servers, application servers, and database servers), switches, routers, data storage devices, load balances, wire cages or closets, vaults, racks, and related equipment;

• Stores, manages, processes, and exchanges digital data and information; or

• Provides application services or management for various data processing, such as web hosting internet, intranet, or tele-communication and information technology.

o. DATA FILE: An electronic file containing data.

p. DATA WAREHOUSE: A Data Warehouse is a merged repository that stores data from multiple sources from an enterprise's various operational systems, that is constructed with predefined schemas designed for data analytics and reporting, for current and historical decision support information. Essential components of a Data Warehouse include the means to (1) retrieve, extract, transform, and load data from different sources for access and analysis, (2) processes to cleanse the data from the operational systems to ensure data quality before it is used for analytics and reporting, (3) maintain, catalogue, and utilize associated metadata including the data dictionary and reference code sets, (4) analyze data, and (5) operate across very large amounts of data. A Data Warehouse differs from a database. A database is used to capture and store data from a limited set of transactional systems (or one), its schema is normalized, and it is not designed to run across very large data sets. A Data Warehouse differs from a data lake. A data lake is a central repository for all types of raw data, whether structured or unstructured, from multiple sources, and its schema is undefined.

q. DEDUCTIBLE: A fixed amount of health care dollars required to be paid by the Member under a health benefit contract before benefits become payable.

r. DELIVERABLE: Refers to any service, duty, performance or other contractual obligation of the Vendor.

s. DEPARTMENT: Refers to the North Carolina Department of State Treasurer.

t. DEPENDENT: An eligible Plan Member other than the Subscriber.

u. EMPLOYEE OR STATE EMPLOYEE: Any individual eligible for coverage pursuant to their employment with a qualifying

Employing Unit as described in Article 3B of Chapter 135 of the North Carolina General Statutes, as may be amended from time to time.

v. E-PROCUREMENT SERVICES: The program, system, and associated Services through which the State conducts electronic procurement.

w. ERROR: The overpayment or underpayment of a claim; payment to the incorrect payee or an incorrect address that occurs due to the fault of the Vendor or its Subcontractor(s) or agent(s).

x. EVALUATION PERIOD: The Evaluation Period begins upon the time set by this RFP for receipt of the Vendor’s Proposals and closes either when the Contract is awarded to a Vendor, or, if no proposals are received, when the Plan cancels the

RFP.

y. FOCUS AUDITS: Audits that are targeted on certain types of claims or services. Focus Audits may include, but are not limited to, coordination of benefits (COB) audits, duplicate claims audits, eligibility audits.

z. GO-LIVE: The first time a system or service can be used after all tests have been completed and the functionality has been implemented. There shall be a Go-Live date in every Implementation Plan.

aa. HIGH DEDUCTIBLE HEALTH PLAN (“HDHP”): The Plan’s ACA-compliant benefit offering that features a high deductible and lower monthly premiums.

bb. HIPAA: The Health Insurance Portability and Accountability Act of 1996, Pub. L. 104-191. Among other things, the law provides uniform federal privacy protection standards for healthcare consumers across the country. The standards protect patients' medical records and other health information provided to health plans, doctors, hospitals, and other health care providers. Developed by the United States Department of Health and Human Services, these standards provide patients with access to their medical records and more control over how their PHI is used and disclosed. The term HIPAA also includes the Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”), Title XIII of Division A and Title IV of Division B of the American Recovery and Reinvestment Act of 2009 (“ARRA”), Pub. L.

No. 11-5, and implementing regulations issued by the United States Department of Health and Human Services, most of which are codified at 45 C.F.R. Parts 160, 162, and 164.

cc. IMPLEMENTATION PLAN: Documentation of the agreed-upon target dates for meeting milestones and Deliverables that must be completed for the provision of Services to Go-Live. Implementation Plans shall be utilized for the initial implementation and Go-Live of the Contract and for any subsequent Amendments or activities that require Vendor system development or Plan vendor integration. Implementation Plans shall include a description of the co-dependencies and Tasks, identification of business, and/or Deliverable owner(s).

dd. INITIAL CONTRACT TERM: A period of time specified by the Plan as the effective date and expiration date of the Contract.

ee. MEMBER: Any active Employee or retiree enrolled in the North Carolina State Health Plan for Teachers and State Employees, or a Dependent currently enrolled in the health benefit plan for which a premium is paid.

ff. N.C.G.S: North Carolina General Statute(s).

gg. OPTIONAL SERVICE: A service or project the Vendor must be prepared to provide if requested by the Plan. The Plan will communicate which Optional Services that the Plan will require the Vendor to provide.

hh. PARTIES TO THE CONTRACT: The Parties (Parties) to this Contract are (1) the Plan; and (2) the Vendor, or if multiple awards are made, Vendors, selected through the RFP process and to whom the Contract is awarded.

ii. PERFORMANCE GUARANTEE: A contractual obligation or performance standard with which the Vendor must comply or be subject to contractual fee reductions, payments to the Plan, or legal remedies.

ll. PLAN: Refers to the North Carolina State Health Plan for Teachers and State Employees established and governed by Article 3B of Chapter 135 of the General Statutes of North Carolina.

mm. PLAN DATA: Any information used, created, received, maintained, or transmitted by the Vendor for the purpose of providing the Services under this Contract. Plan Data does not include information owned by the Vendor as described in Section 1. b) of Attachment C: General Terms and Conditions.

nn. PLAN DESIGN: Each version of the health benefit Product is known as the Plan Design. For example, the Plan currently has three (3) PPO Plan Designs for Active Members: the Enhanced PPO Plan (80/20), the Base PPO Plan (70/30), and the

HDHP.

oo. PRODUCT: An individual healthcare benefit plan or offering that can include medical and/or pharmacy benefits. Products may vary by provider network and discounts, fully insured or self-insured status, provider payment structure, Member availability, and/or region.

pp. PROTECTED HEALTH INFORMATION (“PHI”): Shall have the same meaning as the term “Protected Health Information” in 45 C.F.R. § 160.103, limited to the information created or received by the Business Associate from or on behalf of the Covered Entity.

qq. PROPOSAL: The firm offer submitted by the Vendor in response to this RFP. The terms Bid and Proposal are used interchangeably with Offer in this document.

rr. PUBLIC RECORDS ACT: The North Carolina Public Records Act, N.C.G.S. § 132-1, et seq., which contains certain requirements regarding the public’s right of access to documents and other information held by certain government entities. The Plan is subject to the Public Records Act.

ss. QUALIFIED BID/PROPOSAL: A Responsive bid submitted by a Responsible Vendor.

tt. REDACT(ED): For purposes of this RFP, to edit a document by obscuring or removing information that is considered confidential or proprietary as defined by N.C.G.S. § 132-1.2. All redactions shall be made in accordance with Section V, Paragraph 24 of Attachment B: Instructions to Vendors.

uu. REQUEST FOR PROPOSAL (“RFP”): The document which establishes the bidding and contract requirements and solicits bid Proposals to meet the purchase needs of the Plan as identified herein.

vv. RESPONSIBLE: Refers to a Vendor who demonstrates in its Offer that it has the capability to perform the requirements of the Solicitation.

ww. RESPONSIVE: Refers to a Proposal that conforms to the requirements of this RFP in all respects to be considered by the State for award.

xx. SECURITY BREACH: An incident of unauthorized access to and acquisition of unencrypted and un-Redacted records or data containing personal information where illegal use of the personal information has occurred or is reasonably likely to occur or that creates a material risk of harm to a Member. Any incident of unauthorized access to and acquisition of encrypted records or data containing personal information along with the confidential process key shall constitute a Security Breach. Good faith acquisition of personal information by an employee or agent of the Vendor for a legitimate purpose is not a Security Breach, provided that the personal information is not used for a purpose other than a lawful purpose of the business and is not subject to further unauthorized disclosure. When used for purposes of HIPAA, this term shall have the same meaning as that given to it under 45 C.F.R. § 164.402.

yy. SERVICE PERIOD: The initial service period begins upon the Plan’s acceptance of all implementation Deliverables for which all TPA services are in effect. The Service Periods for this Contract equate to the Plan Year.

zz. SERVICES: The Tasks and duties undertaken by the Vendor to fulfill the requirements and specifications of this solicitation.

aaa. STANDARD AUDITS: Audits performed on an ongoing quarterly basis by the Plan’s Auditors and/or the North Carolina Office of the State Auditor. Standard Audits are used to measure claims accuracy, generally, and associated with Performance Guarantees and identify overpayments bbb. SILENT PERIOD: The Silent Period begins when this RFP is issued and shall be lifted by the Plan after the time for a

Vendor to file a protest has expired or when the RFP is canceled.

ccc. STATE: The State of North Carolina, including any of its sub-units recognized under North Carolina law.

ddd. STATE BUSINESS DAY: Monday through Friday 8:00 a.m. through 5:00 p.m., Eastern Time (ET), except for North Carolina State holidays as defined by the Office of State Human Resources, https://oshr.nc.gov/state-employee-resources/benefits/leave/holidays eee. SUBCONTRACTOR: An entity having an arrangement with a vendor of the Plan, where the Plan’s vendor uses the Products and/or services of that entity to fulfill some of its obligations under its contract with the Plan, while the Plan’s vendor retains full responsibility for the performance of all of said vendor's obligations under the contract, including payment to the Subcontractor. The Subcontractor has no contractual relationship with the Plan, only with the Plan’s vendor.

fff. SUBSCRIBER: The primary health benefit plan contract holder.

ggg. TASK: A discrete unit of work to be performed.

hhh. THIRD PARTY ADMINISTRATOR (“TPA”): A vendor that provides administrative services and assumes responsibility for administering health benefit plans, including claims processing, without assuming any financial risk.

iii. VENDOR: Supplier, bidder, proposer, company, firm, corporation, partnership, individual, or other entity submitting a response to this RFP.

jjj. YOU and YOUR: The Vendor.

[Space is intentionally left blank.] https://oshr.nc.gov/state-employee-resources/benefits/leave/holidays https://oshr.nc.gov/state-employee-resources/benefits/leave/holidays

3.0 METHOD OF AWARD AND PROPOSAL EVALUATION PROCESS

3.1 METHOD OF AWARD

All Qualified Proposals will be evaluated, and awards will be made to the Vendor(s) meeting the specifications of this RFP and achieving the highest and best final evaluation, based on the criteria described below.

While the intent of this RFP is to award a Contract to a single Vendor, the Plan reserves the right to make separate awards to different Vendors for one or more line-items, to not award one or more line-items or to cancel this RFP in its entirety without awarding a Contract if it is considered to be most advantageous to the Plan to do so.

The Plan reserves the right to waive any minor informality or technicality in Proposals received.

3.2 CONFIDENTIALITY AND PROHIBITED COMMUNICATIONS DURING EVALUATION

While this RFP is under evaluation, the responding Vendor, including any Subcontractors and suppliers, is prohibited from engaging in conversations intended to influence the outcome of the evaluation. For more specific information on prohibited communications, see Section V, Paragraph 25 of Attachment B: Instructions to Vendors.

3.3 PROPOSAL EVALUATION PROCESS

The Plan shall review all Vendor responses to this RFP to confirm that they meet the specifications and requirements of the RFP.

Only Responsive submissions will be evaluated.

a) The Plan will conduct a One-Step evaluation of Proposals:

Proposals will be received according to the method stated in Section 2.6 Proposal Submittal above.

All Proposals must be received by the issuing agency not later than the date and time specified in Section 2.4 RFP Schedule above, unless modified by an Addendum. Vendors are cautioned that this is a request for offers, not an offer or request to contract, and the Plan reserves the unqualified right to reject any and all offers at any time if such rejection is deemed to be in the best interest of the Plan, as described in, among others, Section V, Paragraph 11 of Attachment B: Instructions to Vendors.

At their option, the evaluators may request oral presentations or discussions with any or all of the Vendors for Clarification or to amplify the materials presented in any part of the Proposal. The Vendors are cautioned, however, that the evaluators are not required to request presentations or other Clarification—and often do not. Therefore, all Proposals should be complete and reflect the most favorable terms available from the Vendor.

The Plan shall conduct a comprehensive, fair, and impartial evaluation of the Proposals received in response to this request.

Specific evaluation criteria are listed in Section 3.4 Evaluation Criteria below.

Upon completion of the evaluation process, including all necessary approvals, the Plan will make award(s) based on the evaluation and post the award(s) to eVP under the RFP number for this solicitation. Award of a Contract to one Vendor does not mean that the other Proposals lacked merit, but that, all factors considered, the selected Proposal was deemed most advantageous and represented the best value to the Plan.

The Plan reserves the right to negotiate with one or more Vendors, or to reject all original offers and negotiate with one or more sources of supply that may be capable of satisfying the requirement, and in either case to require the Vendor to submit a BAFO based on discussions and negotiations with the Plan. If a BAFO is requested, then, once the Vendors’ BAFOs are received, the Plan will recalculate the score as appropriate.

b) Evaluation Committee

An Evaluation Committee (“Committee”) will be established to review each Proposal and recommend to the Executive

Administrator a Vendor to be awarded the Contract. The Plan may engage the professional services of a different Plan vendor to assist in the evaluation process. The Plan reserves the right to alter the composition of the Committee or to designate other staff to assist in the process. Other designated staff and senior management from the Department of State Treasurer may attend any oral presentations that may occur during the evaluation process. However, all decisions regarding scoring and the final award recommendation will be made solely by Committee members.

The Committee will review and evaluate all Proposals that were submitted by the deadline specified in this RFP. This Committee will be responsible for the entire evaluation process and the evaluation will be conducted in accordance with the steps outlined below. Committee participants are obligated to keep information identified as trade secret and proprietary confidential.

Technical Proposals meeting the Minimum Requirements described in Section 5.1 will be considered and evaluated as follows:

1: Evaluation of Technical Proposal

• Written Technical Proposal (Sections 5.3 Standard Audits, 5.4 Focused Audits, 5.6 Audit Reports, Meetings and

Communication, and 5.7 Implementation)

2: Evaluation of Cost Proposal

3: Determination of Successful Proposal Based on the Combination of Technical & Cost

4: Adjustment of Score After BAFO, if Applicable

c) Approval for Contract Award

After approval by the Board, if applicable, and the Attorney General’s Office, if applicable, the Plan’s Executive Administrator will award the Contract to the bidder with the highest score. A Contract is not binding until the Plan’s Executive Administrator has signed the Acceptance of Proposal.

3.4 EVALUATION CRITERIA

Proposals meeting the Minimum Requirements described in Section 5.1 will be evaluated under the Points-Based Evaluation methodology, and awarded based on the following criteria, to result in an award most advantageous to the Plan. The Technical Proposal and the Cost Proposal will be scored separately based on the overall point scale described below.

The total points scale will reflect the following weights:

Technical Proposal 50% Cost Proposal 50% Total: 100%

Both the Technical Proposal and Cost Proposal will be based upon a maximum of 30 points each. Each item to be confirmed in the Technical Requirements shall be assigned one point. The following example will include the technical requirements to be evaluated.

TECHNICAL AREAS Maximum Points

Section 5.3.B. Standard Audit Section 5.4.B. Focused Audit Section 5.6.A. Audit Reports, Meetings and Communication Section 5.7.A. Implementation

Total 30

The State will evaluate Cost Proposals submitted in accordance with Attachment A. The State will determine low cost by normalizing the scores as follows:

The Proposal with the lowest cost will receive a score of 30. All other competing Proposals will be assigned a portion of the maximum score using the formula:

30 x [2 - (The cost of the Cost Proposal being evaluated / The cost of the lowest Cost Proposal) ]

Cost proposals in which the cost is expected to be more than twice the lowest cost Proposal will receive 0 point.

Vendors are cautioned that this is a request for offers, not a request to contract, and the State reserves the unqualified right to reject any and all offers when such rejection is deemed to be in the best interest of the State.

3.5 PERFORMANCE OUTSIDE THE UNITED STATES

The Vendor shall complete ATTACHMENT E: LOCATION OF WORKERS UTILIZED BY VENDOR. In addition to any other evaluation criteria identified in this RFP, the Plan may also consider, for purposes of evaluating proposed or actual contract performance outside of the United States, how that performance may affect the following factors to ensure that any award will be in the best interest of the Plan:

a) Total cost to the State;

b) Level of quality provided by the Vendor;

c) Process and performance capability across multiple jurisdictions;

d) Protection of the Plan’s information and intellectual property;

e) Availability of pertinent skills;

f) Ability to understand the Plan’s Business Requirements and internal operational culture;

g) Particular risk factors such as the security of the Plan’s information technology;

h) Relations with citizens and employees; and

i) Contract enforcement jurisdictional issues.

4.0 REQUIREMENTS

This Section lists the requirements related to this RFP. By submitting a proposal, the Vendor agrees to meet all stated requirements in this Section as well as any other specifications, requirements, and terms and conditions stated in this RFP. If a Vendor is unclear about a requirement or specification or believes a change to a requirement would result in a better Proposal for the Plan to consider, the Vendor is urged to submit these items in the form of a question during the question-and-answer period in accordance with Section 2.5 Proposal Questions above.

4.1 PRICING

The Proposal price shall constitute the total cost to the Plan for complete performance in accordance with the requirements and specifications herein. The Vendor shall not invoice for any amounts that are not specifically permitted by this RFP.