RFP Number OPM049-08-R-0002 - Amendment Number 0001.doc

OPM049-08-R-0002 Page 2 of 7

U.S. OFFICE OF PERSONNEL MANAGEMENT

MSD/CCFAS/CONTRACTING GROUP

1900 E STREET, NW, ROOM 1342

WASHINGTON, DC 20415-7710

SAME

9B. DATED (SEE ITEM 11)

August 25, 2008

10A. MODIFICATION OF CONTRACT/ORDER NO.

10B. DATED (SEE ITEM 11)

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by:

(1) Acknowledging receipt of this amendment on each copy of your offer submitted.

FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment your desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

12. ACCOUNTING AND APPROPRIATION DATA (IF REQUIRED)

13. THIS ITEM ONLY APPLIES TO MODIFICATION OF CONTRACTS/ORDERS

IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

NO. IN TTEM 10A

B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, Appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF far 43.103(b).

C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

D. OTHER (Specify type of modification and authority)

E. IMPORTANT: Contractor is not, is required to sign this document and return copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

See page 2.

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

(Signature of person authorized to sign)

(Signature of Contracting Officer)

NSN 7540-01-152-8070

Previous edition unusable

STANDARD FORM 30 (REV. 10-83)

Prescribed by GSA FAR (48 CFR) 53.243

The purpose of Amendment Number 0001 to Solicitation Number OPM049-08-R-0002 is as follows: (1) Revise a paragraph in Section C; (2) Correct typographical errors in Section I; (3) Delete two clauses from Section I; (4) Add 13 clauses to Section I; (5) Provide a revised Attachment 3A to Section J; (6) Provide OPM Letter to State Medicaid Directors Regarding Partnerships as Attachment 10 to Section J; (7) Provide the 2004, 2005, 2006, and 2007 FLTCIP Experience Fund Balance Sheets as Attachments 11, 12, 13, and 14 to Section J; (8) Update the small business size standard in Sections K , L, and M; (9) Delete one provision from Section L; (10) Revise two paragraphs in Section L; (11)Provide the questions we received regarding the Request for Proposals (RFP) and our answers in response to those questions; and (12) Provide the cutoff date and other information regarding the second round of RFP questions. Accordingly, the solicitation is amended as follows:

1. Page 24, Section C, Paragraph C.2.(I)8 is deleted and replaced with the following paragraph(the revisions are highlighted):

The Contractor is prohibited from paying commissions, establishing quotas, offering incentives or taking any other action(s) to reward its employees, subcontractors or representatives/agents for obtaining completed or approved FLTCIP applications.

2. Page 42, Section I – “Part I” stated at the top of the page is deleted and replaced with “Part II.”

3. Page 42, Section I, Paragraph I.1 – The following clauses are deleted:

NUMBER

TITLE

DATE

52.204-5 WOMEN-OWNED BUSINESS (OTHER

THAN SMALL BUSINESS)

MAY 1999

52.222-4 CONTRACT WORK HOURS AND

SAFETY STANDARDS ACT –

OVERTIME COMPENSATION

JULY 2005

4. Page 42, Section I, Paragraph I.1 – The following clauses are added:

52.219-9 SMALL BUSINESS

SUBCONGTRACTING PLAN

APR 2008

52.219-9 Alt II

SMALL BUSINESS

SUBCONTRACTING PLAN –

ALTERNATE II

OCT 2001

52.222-3 CONVICT LABOR

JUN 2003

52.222-21 PROHIBITION OF SEGREGATED

FACILITIES

FEB 1999

52.222-26 EQUAL OPPORTUNITY

MAR 2007

52.222-26 Alt I

EQUAL OPPORTUNITY – ALTERNATE I

FEB 1999

52.222-35

EQUAL OPPORTUNITY FOR SPECIAL

DISABLED VETERANS, VETERANS OF

THE VIETNAM ERA, AND OTHER

ELIGIBLE VETERANS

SEP 2006

52.222-37 EMPLOYMENT REPORTS ON SPECIAL

DISABLED VETERANS, VETERANS OF

THE VIETNAM ERA, AND OTHER

ELIGIBLE VETERANS

SEP 2006

52.223-6 DRUG-FREE WORKPLACE

MAY 2001

52.228-5

INSURANCE – WORK ON A

GOVERNMENT INSTALLATION

JAN 1997

52.233-4 APPLICABLE LAW FOR BREACH OF

CONTRACT CLAIM

OCT 2004

5. Page 44, Section I, Clause I.6 – “OPTOIN” is deleted and replaced with “OPTION.”

6. Page 56, Section I, Clause I.28, Paragraph (a) – The last line is deleted and replaced with the following (the revision is highlighted):

“…provision shall be credited as set forth below no later than the 25th month after issuance.”

Page 56, Section I, Clause 1.28, Paragraph (c) – The last line is deleted and replaced with the following (the revision is highlighted):

“…charge the Experience Fund the lesser of actual expenses or the expense cap.”

7. Section I, the following clause is added in full text:

I.33 GROUP POLICY

(a) The group policy (or policies) for long-term care insurance contemplated by this contract will be incorporated into the contract by modification to the contract when the parties have agreed to the terms and conditions of such policy (or policies).

(b) The group policy (or policies) for long-term care insurance to be agreed upon by the parties must be consistent with the terms and conditions of this contract.

To the extent that any inconsistency exists between the group policy and any other provision of this contract, the provisions of this contract prior to incorporation of the group policy into the contract, shall control.

8. Section I, the following clause is added in full text:

I.34 CHANGES

(a) The Contracting Officer may at any time, by written order, make changes within the general scope of this contract in any one or more of the following:

(1) Description of services to be performed.

(2) Time of performance (i.e.: hours of the day, days of the week, etc.).

(3) Place of performance of the services.

(4) Description of benefits to be provided.

(b) If any such change causes an increase or decrease in the cost of, or the time required for, performance of any part of the work under this contract, or the Carrier’s liability under this contract, whether or not changed by the order, the Contracting Officer will make an equitable adjustment in the contract price, the delivery schedule, or both, and will modify the contract.

(c) The Carrier must assert its right to an adjustment under this clause within 30 days from the date of receipt of the written order. However, if the Contracting Officer decides that the facts justify it, the Contracting Officer may receive and act upon a proposal submitted before final payment of the contract.

(d) If the Carrier’s proposal includes the cost of property made obsolete or excess by the change, the Contracting Officer will have the right to prescribe the manner of the disposition of the property.

(e) Failure to agree to any adjustment will be a dispute under the Disputes clause. However, nothing in this clause will excuse the Carrier from proceeding with the contract as changed.

9. Page 60, Section J – The following attachments are added:

Attachment Number

Attachment Title Attachment 10

OPM Letter to State Medicaid Directors Regarding

Partnerships

Attachment 11

2004 FLTCIP Experience Fund Balance Sheet Attachment 12

2005 FLTCIP Experience Fund Balance Sheet Attachment 13

2006 FLTCIP Experience Fund Balance Sheet Attachment 14

2007 FLTCIP Experience Fund Balance Sheet

10. Page 61, Section K; Page 79, Section L; and Page 103, Section M – The small business size standard is updated from $6.5 million to $7.0 million.

11. Page 62, Section L – The following provision is deleted:

Clause

Title

Date 52.237-10 Identification of Uncompensated

Overtime

October 1997

12. Pages 67 and 68, Section L, Paragraph L.3.2.2, Contractor Information Questions, Number 2 is deleted and replaced with the following paragraph (the revisions are highlighted):

2. Provide the following information about your company. If this is a joint offer (i.e., a Consortium), provide the following information separately for each company in the Consortium:

a. Company’s name and State of domicile.

b. Services you will be providing to the FLTCIP.

c. Proof of your financial capacity and capabilities to undertake and successfully complete your portion of the contract. An audited financial statement, including management reports, and annual reports for the three most recent fiscal years and current bank reference(s) are acceptable. Include a copy of the most recent certified audit by an independent outside auditor. Disclose your current and two prior financial ratings from A.M. Best, Moody’s, Standard and Poors, and Weiss, as available. If your rating(s) deteriorated within the last three years, explain why. If you have a parent company, provide financial information for this structure as well. Describe the impact of recent market instabilities on your company’s financial outlook.

d. The outcome, year, jurisdiction and case citations of any lawsuits that have been filed against your company within the last ten (10) years for any aspects of your long term care insurance program.

e. Any regulatory or administrative actions taken against your company within the last ten (10) years with respect to any aspects of your long term care or other insurance programs.

f. Information demonstrating your organization’s capability of assuming this risk. This should include, but is not limited to:

· Names and telephone numbers of three corporate references evidencing your qualifications and capabilities.

· Description of your corporate structure, including a discussion of where the long term care insurance business fits within that structure. Be specific in describing the entity or entities that would enter into a contract for the FLTCIP, issue the insurance policy, and be responsible for the day-to-day operation of the Program. Include an organizational chart showing your entire organizational structure, highlighting which part of that structure would be involved with the FLTCIP, such as marketing, education, enrollment, care management, claims, customer service, overall project, etc. Identify the names and titles of management, supervisory and other key personnel or account team members that will be assigned to this contract. Identify the percentage of time that each will dedicate to the FLTCIP.

· A list of back-up staff who may work on the FLTCIP to help or replace key individuals assigned to service and manage the account. In addition, if you anticipate staffing up by temporary hires (including contractors and subcontractors) explain how this will work and lines of authority over them.

· Net assets, stop loss, reinsurance, and/or parent company arrangements that have been made to assure that funds will be available to meet the obligations incurred under this contract.

· A description of the major subcontracts you intend to utilize if awarded the FLTCIP contract.

g. For your largest group long term care insurance contract in force, describe how you implemented and are managing underwriting, reporting, administration, education and marketing, customer service and care coordination. Also include statistics on that group’s lapse rate. Be specific in all descriptions. For example, did you perform the underwriting in house or subcontract it, who did the marketing, what outside resources were called upon, and so forth.

Provide the total amount of long term care insurance premium (in dollars) in force for your company and the number of covered lives, as specified in the chart, for year-end 2005-2007. You should also use this chart if you are an organization handling administrative services only (e.g., self-insured) contracts and are not at risk.

a. Total Employer Group LTC Insurance

(i) Premiums or premium equivalents in force

(ii) Number of covered employee lives

b. Total OTHER Group LTC Insurance

(i) Premiums in force

(ii) Number of covered lives

c. Total Individual LTC Insurance

(i) Premiums in force

(ii) Number of covered lives

d. Total Group and Individual LTC Insurance

(i) Premiums in force

(ii) Number of covered lives

h. Provide information as specified in the chart below about the number of group accounts you service.

a. Total Employer Group LTC Insurance

(i) Number of group accounts serviced

(ii) Average account size (# of covered lives)

b. Total OTHER Group LTC Insurance

(i) Number of group accounts serviced

(ii) Average account size (# of covered lives)

c. Total of all Groups

(i) Number of group accounts serviced

(ii) Average group size (# of covered lives)

i. Since the inception of the FLTCIP nearly seven years ago, the long term care insurance industry has undergone significant changes. Many carriers have exited the market, and in the eyes of many observers, overall sales have been less robust than expected. Describe your company’s continuing commitment to the long term care insurance business. This should include, but is not limited to:

· What percentage of your organization’s overall business the long term care insurance line comprises;

· How long your company has provided long term care insurance on an individual and/or group basis;

· What overall trends you expect to see in the LTCI industry in the next seven years;

· How your company intends to shape or respond to these trends and the implications for the FLTCIP.

j. Have you ever raised premiums, have a request pending, or intend to raise premiums on an existing book of long term care insurance business? If so, describe how you handled or plan to handle the process, including the amount of the increase and communication to affected enrollees and the public.

13. Page 78, Section L, Paragraph L.3.2.2, Education, Marketing and Enrollment Questions, the following Number is added:

18. If you also are in the individual long term care insurance market, describe the steps that you would take to avoid channel conflict between the FLTCIP and your individual business.

14. The questions we received regarding the RFP and our answers in response to those questions are attached.

15. We will not conduct a preproposal conference. We will allow a second round of RFP questions. We must receive all RFP questions or issues requiring clarification in writing no later than October 14, 2008, 3:00 PM local time. You are responsible for confirming receipt of any electronic mail. We will answer all questions or issues requiring clarification we receive by October 14, 2008 and include them in an amendment to this RFP, which we will post on the Federal Business Opportunities (FBO) web site at https://www.fbo.gov. E-mail all RFP questions or issues requiring clarification to Cheryl D. Allen at Cheryl.Allen@opm.gov.

16. The hour and date specified for receipt of offers is not extended. Offers are due by 3:00 PM local time, November 14, 2008.

Except as provided herein, all terms and conditions of this solicitation, as heretofore changed, remain unchanged and in full force and effect.