Draft-IBP-SOW.docx

OPM2018-HI-001 Page 14 of 14

United States Office of Personnel Management

Federal Employees Health Benefits Program

Indemnity Benefit Plan

DRAFT Statement of Work

OPM2018-HI-001

OPM***-**

May 14, 2018

SECTION C – DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

C.1 Background

(A) Objective

The U.S. Office of Personnel Management (OPM) contracts for insurance benefits for more than eight million Federal employees, retirees and their families (demographic information on employees and annuitants will be released with the final solicitation). In this capacity, OPM is issuing this request for proposals (RFP) from qualified health insurance carriers to offer the Indemnity Benefit Plan (IBP) described at 5 U.S.C. § 8903(2) under the Federal Employees Health Benefits (FEHB) Program with coverage commencing January 1, 2020. The plan will be offered under the contracting authority granted to OPM at 5 U.S.C. § 8902. This statement of work provides FEHB Program requirements that all FEHB Program Carriers must meet or requirements specific to this procurement found in FEHB Program law. When the final solicitation is issued, it will include instructions to offerors regarding how applicant carriers may respond to meet these requirements and how the plans’ offerings will be measured to grant a single award to the offeror that represents the best value for the FEHB Program and its enrollees. The winning offeror will sign a standard Fee-for-Service FEHB Program contract like the one attached to this posting.

OPM is seeking innovative proposals from a carrier or a group of carriers to increase market competition in the FEHB Program. We are not seeking plans that replicate the offerings already available in the FEHB Program. Your proposal should provide an offering that is meaningfully different than other FEHB Program plans. That is, potentially through different enrollee out-of-pocket costs to incentivize appropriate medical care, high-performing networks to incentivize better value at lower costs, or through innovative medical or pharmacy delivery systems, etc. We recognize that the healthcare delivery system is continuously evolving at an ever-increasing rate, and healthcare coverage needs to continue to evolve to meet the needs of the market.

Our agency has established a strategic objective to improve the quality and affordability of FEHB Program Plan offerings. We will meet this goal through greater competition among health plans and more choice for enrollees, by better informing FEHB Program consumers, and by incentivizing quality and affordability in this plan and other FEHB Program plans through the OPM Plan Performance Assessment methodology and our bilateral negotiation with FEHB Program Carriers.

The FEHB Act of 1959, which authorized the FEHB Program, codified at 5 U.S.C. §§ 8901 et seq., allows OPM to contract with qualified carriers to provide health benefits to Federal employees, retirees and their eligible family members. The statute limits the participation of health benefits plans to one government-wide Service Benefit Plan, one government-wide Indemnity Benefit Plan, plans sponsored by federal employee and postal organizations, and an unlimited number of comprehensive medical plans [commonly known as Health Maintenance Organizations (HMOs).] Since 1989 there has not been a participating plan in the government-wide IBP slot.

(B) Overview

This RFP will be used to evaluate your ability to administer the indemnity benefit plan contemplated at §8903(2) under the FEHB Program and the value that you can offer to Federal employees and annuitants. The requirements shown in this RFP are minimum requirements for participation in the FEHB Program.

We will award one contract to the carrier that offers the best value to the Federal Government, Federal employees and annuitants and other eligible persons. Premiums will be established for the IBP contract utilizing retrospective experience rating as used in the FEHB Program (see definitions below). The Carrier is responsible for all claims liabilities and administrative expenses incurred during the period of contract performance.

Benefit designs must be comprehensive and competitive to the largest government-wide plan and other nationwide fee-for-service (FFS) carriers. The lowest plan option that you propose must meet the minimum value standard of 60% established by the Patient Protection and Affordable Care Act (ACA). The value will be assessed for active enrollees, annuitants without Medicare and for annuitants with Medicare using the FFS FEHB Program population (see Attachment X, Demographic Information) (Note, all attachments referenced in this draft SOW other than the FFS standard contract will be first released with the final solicitation. Here, all attachments are labelled “Attachment X.”) as the demographic basis for the valuation. The Carrier whose proposal is selected must sign an FEHB Program Standard Contract for Experience Rated Carriers (as an example, see Attachment X, 2018 FEHB Program Standard Contract for FFS Carriers).

At a minimum, your proposal must be for two benefits options (e.g., a High and a Standard option); alternatively, your proposal may be for three options, or two options and a high deductible health plan within the meaning of 26 U.S.C. 223(c)(2)(A). There must be a meaningful difference in the separate benefit options offered and that difference must be easily perceived by prospective enrollees. Among other considerations, we will assess the difference in the actuarial value of the options you propose.

You must propose to provide benefits within the framework of the fee-for-service FEHB Program brochure template: see Section C.2, Summary of Requirements, Paragraph (C), Plan Design and Attachment X, 2018 FEHB Program FFS Brochure Template. (See Attachment X, 2018 FEHB Program FFS Brochure Handbook Version 2, which provides instructions and guidance for the FEHB brochure.) We will accept different levels of benefits coverage; however, each level of benefits you propose must meet all FEHB Program requirements that apply to carriers, such as mental health parity, that are documented within the Carrier Letters available at OPM’s website: https://www.opm.gov/healthcare-insurance/healthcare/carriers/#url=Carrier-Letters. You should pay special attention to the Annual FEHB Program Call Letter and Technical guidance as well as Carrier letters that reference financial reporting or require carriers to submit reports or other documentation to OPM. You can propose variations in benefits based on in-network and out-of-network care; however, cost sharing requirements (e.g. copayments/coinsurance) and premiums must be the same nationwide. The IBP is required to make its benefits available overseas for enrollees.

If selected to participate in the FEHB Program, you must abide by the following FEHB Program guiding principles https://www.opm.gov/healthcare-insurance/healthcare/carriers/reference/principles/.

All FEHB carriers must be committed to:

1. Ensuring enrollees have access to good healthcare benefits;

2. Striving to keep FEHB premiums affordable;

3. Ensuring enrollees have access to quality provider networks;

4. Providing competitive healthcare choices for consumers;

5. Strengthening information for consumers so they can be more involved and responsible for their own healthcare decisions;

6. Being well managed and financially secure;

7. Providing efficient and effective contract administration;

8. Ensuring the timely and accurate submission of actuarial data and financial accounting information;

9. Maintaining compliance with FEHB laws, regulations, contract requirements and administrative guidance at all times; and

10. Guaranteeing that enrollee and Government resources are protected.

(C) Program Structure

The FEHB Program is a market-based program that allows employees, annuitants and other eligible persons to review their health plan choices and make changes to their individual enrollment elections each year. There are currently 15 fee-for-service plan choices open to all, four fee-for-service plan choices with availability limited to enrollees of certain agencies, and comprehensive medical plan choices available in all FEHB Program geographic areas (i.e., HMO, HDHP, CDHP).

FEHB Program contracts operate on a calendar year basis and annual enrollment changes are allowed during the Federal Benefits Open Season (which is held from mid-November to mid-December). Enrollment change is also permitted when an enrollee experiences a qualifying life event. Benefits and rates are negotiated between June and August based on annual Call Letter guidance that outlines our objectives for the upcoming contract year. Changes negotiated are effective in January of the following year. Carriers prepare their FEHB Program plan brochures (Attachment X) during August and September and the text, which is agreed upon by OPM is incorporated in the contract (see Attachment X) as the official statement of the plan’s benefits. Rates are incorporated at Appendix B of the contract (Attachment X) and are also shown in the brochure (Attachment X). Other contract provisions are uniform for all carriers of similar type and rate structure (i.e., experience rated or community rated). FEHB Program contracts are fully executed before the beginning of each contract year.

FEHB Program plans must comply with all applicable provisions of the Federal Acquisition Regulations (FAR), 48 CFR Ch.1 (Parts 1 to 51), and applicable provisions of the Federal Employees Health Benefits Acquisition Regulation (FEHBAR), 48 CFR Ch.16. In addition, each FEHB Program carrier must comply with the requirements of 5 U.S.C. Chapter 89, 5 CFR part 890, and each of the policies outlined in the FEHB Program Carrier Letters, which are available on OPM’s web site at http://www.opm.gov/carrier. (See Attachment X, FEHB Program Law.)

Some features of the FEHB Program may be different from those of other employer group plans. By submitting an offer, you agree that you understand and will abide by the following FEHB requirements:

1. You must accept the enrollment of all eligible Federal and U.S. Postal Service employees, annuitants (retirees and compensationers) and other eligible persons regardless of age, Medicare eligibility, or health status.

2. The Carrier must interface with the OPM Data Hub to receive and process HIPAA compliant 834/5010 2809 and 2810 enrollment transaction files. In some cases, the carrier must receive and process SF 2809 and SF 2810 paper forms.

3. Enrollment reconciliation will occur through the OPM Centralized Enrollment Reconciliation Clearing House System (CLER). Carriers must submit their enrollment files to the OPM Macon Data Hub on a quarterly basis.

4. A Plan may only disenroll or terminate a member for reasons outlined in OPM regulations and guidance, after notice to the member.

5. You may not require Federal members to enroll in Medicare Parts A, B, C, or D.

6. You may not require a waiting period for a covered benefit offered to any Federal member.

7. You may not deny a benefit for a Federal member solely because of a preexisting condition.

8. You must cover all children of Federal enrollees until their 26th birthday regardless of student status, marital status or financial dependence on the parent.

9. You may not require Federal enrollees to pay an initiation, service, or other enrollment fee in addition to premium.

10. You must provide each enrollee with an identification card or cards within 14 days of receiving the enrollment transaction.

11. You must keep financial and statistical records in accordance with guidance provided by OPM and furnish such reports as OPM may request.

12. You may not commingle any FEHB funds with funds for other lines of business.

13. You must make all records and accounts pertaining to the plan available to representatives of OPM and the U.S. Government Accountability Office (GAO).

14. Enrollees may dispute denials of coverage under on the FEHB disputed claims process, section 8 of the FEHB Program brochure.

You must agree to comply with the premium requirements for retrospective experience rating used in the FEHB Program:

1. You must be able to track FEHB claims separately from the claims for other groups.

2. You must be capable of allocating the administrative costs separately for the Federal group.

3. You must agree to annual limits on your administrative costs.

4. You must carry over gains and losses from year-to-year and incorporate them into the annual rating process.

5. You must be able to demonstrate that you have criteria for retrospective experience rating.

6. Your experience-based rates are calculated considering three types of reserves specific to each plan: the contingency reserve; the accrued claims reserve to pay claims that have been incurred to date but not yet paid; and the special reserve, or difference between plan income and expenses.

7. The special reserve, held by OPM, is subject to drawdown by the plan through a Letter of Credit (LOC) arrangement as described in 48 CFR 1632.170.

(D) Enrollment Options

5 U.S.C. § 8905 allows an employee to enroll in an approved health benefits plan for Self Only, Self Plus One, or Self and Family coverage. Annuitants may continue enrollment subject to the requirements of FEHB law. No enrollee or family member may receive benefits under more than one FEHB enrollment.

(E) Communications

A number of means are available to communicate with employees and annuitants. Attachment X, Communication Vehicles of this RFP includes information regarding the various ways that FEHB Program plans can communicate with potential enrollees. It should be noted that direct-mail and email are not used by FEHB carriers for enrollment purposes.

The FEHB Supplemental Literature Guidelines are contained in Appendix C of the Standard Contract for fee-for-service carriers (Attachment X), which will be signed by the selected IBP carrier. Supplemental marketing literature, including website material, must comply with FEHBAR 1603.70. In addition, Appendix C of the Standard Contract (Attachment X) includes detailed information on how you may present your rates, benefits, provider directories, and other information.

(F) Premium Negotiation

Premiums can be adjusted only by mutual agreement between OPM and the carrier. Section C.2, Paragraph (E), Premiums, provides information regarding the retrospective experience rating methodology used to set premiums during annual contract negotiations. Section L in the final solicitation will provide precise information regarding submitting your price proposal, which will be due in November 2018.

Your price proposal should be such that adequate reserves are established over time to promote long term premium stability. You should recognize that initial enrollment may include favorable risks resulting in a buildup of reserves in the early years.

In early 2019, OPM will release its annual Call Letter for 2020 benefit and rate proposals. The successful offeror may propose rate adjustments at that time in response to benefit changes related to initiatives outlined in the Call Letter and any other legislative and/or policy requirements communicated by carrier letter. The carrier may also adjust the premium rates based on any changes to the carrier’s administrative contracts that occur during 2019. The carrier cannot request any other changes to premium for 2020. The selected carrier will not begin providing benefits or receiving subscription income until January 1, 2020.

(G) Letter of Credit (LOC)

In accordance with 48 CFR 1632.170, premium payments received for the plan, less the amounts credited to the contingency and administrative reserves and amounts for other obligations due under the contract, will be made available for carrier drawdown from the LOC not later than 30 days after receipt by the FEHB Fund. Your drawdown of the special reserve will be audited, and appropriate management of the special reserve account will be an element of the plan’s performance considered with respect to the service charge (see (I) below). See Attachment X, Letter of Credit System Guidelines.

(H) Administrative Costs

Each plan will include a proposed administrative cost limit in its price proposal. The agreed upon administrative cost limit will become the Contractual Expense Limitation for 2020. The administrative costs allowable under the contract will be the actual administrative costs provided they are for FAR allowed charges and do not exceed the Contractual Expense Limitation for 2020, plus an amount sufficient to cover the costs needed to pay the Plan’s Independent Public Accountant to undertake the audits and agreed upon procedures required in the Financial Reporting and Audit Guide (see Attachment X).

The administrative cost limit for 2021 will be negotiated based on a review of plan submitted expenses and the proposed expenses for 2021. For future contract years, the Contractual Expense Limitation will be the Contractual Expense Limitation for the prior year, plus or minus adjustments for inflation and enrollment changes. This means, for 2022, the base shall be adjusted by percentage changes in enrollment (from OPM's March 2020 to March 2021 headcount) and by the percentage change in the average monthly Consumer Price Index for All Urban Consumers (published monthly by the Bureau of Labor Statistics) from the 12-month period ending on June 30, 2020, to the 12-month period ending on June 30, 2021.

(I) Profit

Profit available under FEHB Program contracts is limited by the profit analysis factors outlined in FEHBAR 1615.404-70. Profit is negotiated annually based on your performance in the prior year. The profit payable will be up to 1% of projected incurred claims and allowable administrative expenses. The profit loading you propose for the initial contract year should reasonably reflect your best estimate of your future performance given recent HEDIS and CAHPS scores and the factors outlined in FEHBAR 1615.404-70. The amounts you propose based on the weighted factors shown at FEHBAR 1615.404-70 will be applied to projected incurred claims and allowable administrative expenses to arrive at your profit. For more information on Plan Performance Assessment, see the 2018 Plan Performance Assessment Procedure Manual: https://www.opm.gov/healthcare-insurance/healthcare/carriers/2017/2017-12a1.pdf.

(J) IT Security

Carriers must comply with OPM IT Security and Privacy, National Institute of Science and Technology (NIST) and Office of Management and Budget (OMB) requirements for system users, including vulnerability scanning and access to systems to perform vulnerability scanning. Please see (Attachment X) for additional details.

(K) Audits of Plans Costs

The Federal Government maintains a right to audit contracts that are initiated based on the FEHB Act. The Federal Government has the right to examine and audit all records and other evidence sufficient to reflect properly all costs claimed to have been incurred or anticipated to be incurred directly or indirectly in performance of the contract. This right of examination will include inspection at all reasonable times of the Carrier’s facilities, or parts of them, engaged in performing the contract. Unless otherwise requested, the Carrier shall furnish to OPM audit, financial, and other information in the format and within the time frames specified in the Financial Reporting and Audit Guide: https://www.opm.gov/healthcare-insurance/healthcare/carriers/2017/2017-07a.pdf.

(L) Coordination of Benefits

OPM expects all carriers to rigorously pursue coordination of benefits when a member is covered by two or more health benefits plans, including Medicare. Rules for coordination of benefits under the FEHB Program are found at Appendix D of the Standard Contract (Attachment X). The quality of your compliance with procedures for coordinating benefits will be reviewed in audits and will be considered in our assessment of Carrier performance in the negotiation of the Service Charge. FEHB coverage for dental and vision benefits is always primary over benefits provided by the Federal Employees Dental and Vision Insurance Program (FEDVIP).

(M) Timeline

Below is the timeline that leads up to the January 1, 2020 effective date.

2018-

2019-

2020-

January 1 Effective date of coverage

C.2 Summary of Requirements

Special Note: You must answer questions stated in Section L regarding each of the below requirements and include your responses as a part of your response to this RFP.

(A) Carrier Information

1. A carrier may be a single company or a carrier entity comprised of a joint venture or other association that is not formally a single legal entity, so long as it is united in its operations under contract to respond to this RFP. However, OPM will execute a single contract with a carrier, and the signatory company or associated entity united in its operations as carrier, will be bound to perform the contract as a carrier.

2. By the time of the contract award, a successful nationwide carrier must be licensed, approved, or certified to conduct business under applicable state laws in all 50 states and the District of Columbia. In the case of a carrier comprised of more than one entity, the requirement can be met by the entities collectively.

3. Relationships with subcontractors, affiliates, or members of a joint contracting entity cannot be exclusive. This means that each entity serving as carrier or engaging in a relationship to serve as part of a carrier must be free to enter into more than one proposal relationship or contracting arrangement with OPM (and/or with other contracting entities) at the outset and for the duration of this contract as well as in any re-competition.

(B) Financial Adequacy

1. The Carrier must demonstrate adequate financial resources to perform the prospective contract.

(C) Plan Design

OPM is committed to the strategic objective of increasing quality and affordability of healthcare in the FEHB Program. We are seeking proposals that are innovative and competitive with the other government-wide FFS carriers in the FEHB Program. Your benefit designs should not promote risk selection. Benefit designs that promote risk selection will receive low merit rating.

1. You must use the FEHB Program brochure template (Attachment X) and the Brochure Creation Tool (BCT).

2. You must propose a minimum of two options and a maximum of three options, or two options and a qualified high deductible health plan (HDHP). The options proposed must have meaningful actuarial and/or administrative differences between options. A qualified HDHP may have a health savings account (HSA) or health reimbursement arrangement (HRA). For OPM’s guidance on HDHPs see Carrier Letter 2007-08. Per Carrier Letter 2018-01, premium pass-through amounts may exceed 50% of the plan’s deductible.

3. You must design your benefit structure so that it meets the definition of indemnity coverage in the FEHB Program Act, as codified in 5 U.S.C §8903(2).

4. You must use provider networks to provide for cost effective, evidence-based medical, surgical, and mental health care. You must have a robust network to support your network benefits for inpatient care, outpatient care, skilled nursing and hospice care. We will consider proposals from carriers that do not offer an adequate nationwide network of providers to be non-responsive to the RFP. You may propose narrow networks provided there is adequate provider coverage for the FEHB population.

5. We will only accept proposals from carriers that offer a combined network and non-network coverage for one or more options. You may also offer an in-network only structure coverage for one or more options.

6. You must provide network access for members that live overseas or have a benefits structure that supports healthcare for overseas members.

7. You may have no limitations or exclusions based on pre-existing medical conditions.

8. You must propose benefits that comply with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). You must clearly demonstrate the quantitative treatment limitations and non-quantitative treatment limitations in your proposal submission.

9. You may propose annual visit and/or dollar limitations on nonessential benefits and services. You may not propose lifetime maximums on any benefit.

10. You may propose annual deductibles and catastrophic dollar limits for self, self plus one, and self and family enrollment options. You may have separate annual deductibles and catastrophic limits for out-of-network care.

11. You must propose coverage that qualifies as minimum value as defined by Internal Revenue Service guidance and regulations under the Patient Protection and Affordable Care Act’s (ACA).

12. You must cover all Class A and B preventive services for adults age 22 and over, recommended by the U.S. Preventive Services Task Force (USPSTF) with no cost share. You may limit waiver of cost share to in-network providers. This includes services recommended by the Advisory Committee on Immunization Practices (ACIP) and Health Resources and Services Administration (HRSA) and the National Academy of Medicine committee on women’s clinical preventive services.

13. You must cover preventive services for children up to age 22, including services recommended under the ACA and described in the Bright Future Guidelines provided by the American Academy of Pediatrics and services recommended by the United States Preventive Services Task Force (USPSTF) and the Advisory Committee on Immunization Practices (ACIP) with no cost share.

14. You must provide Applied Behavioral Analysis (ABA), speech, physical and occupational therapy. You may impose visit and/or dollar amount limits for speech, physical and occupational therapy. You may propose limits for ABA as long as you comply with mental health parity, where applicable.

15. You must provide benefits for durable medical equipment (DME), orthopedic and prosthetic devices.

16. You must have available a Health Risk Assessment (HRA) for members.

17. You may propose specialized programs to manage chronic and severe medical conditions.

18. You must cover the diagnosis and treatment of infertility. You may cover alternatives to conventional conception such as Assisted Reproductive Technology (ART) and/or services and procedures related to ART such as cryopreservation or storage of sperm, eggs or embryos.

19. You must provide benefits for reconstructive surgery when surgery corrects a condition that resulted from a functional defect or resulted from an accidental injury, disease or from surgery if the accident, disease or surgery has produced a major effect on the member’s appearance and the condition can be reasonability expected to be corrected by such surgery and to correct a congenital anomaly that existed at or from birth and is a significant deviation from the common form or norm.

20. You must provide benefits for breast reconstruction surgery following a mastectomy, including surgery to produce symmetrical appearance on the other breast. You must provide benefits for all stages of breast reconstruction following a mastectomy, including lymphedemas and breast prosthesis including surgical bra and replacements.

21. You must cover all required organ/tissue transplants as indicated in (Attachment X). You may cover the other organ and tissue transplants listed in (Attachment X).

22. You must provide transitional care. Transitional care is initiated if a provider is terminated by the plan from its network of providers for other than cause, and it allows members undergoing treatment for chronic or disabling conditions (or in second or third trimester of pregnancy) to continue to receive coverage for the services of the treating specialist for up to 90 days or until the end of postpartum care.

23. You must establish procedures to manage catastrophic disease conditions under coordinated care or case management.

24. You must have a Hospital Utilization Review program that includes pre-certification, prior approval, concurrent reviews, discharge planning and retrospective reviews.

25. You must cover blood and blood products.

26. We encourage waiving coinsurance, copayments and deductibles for Medicare enrollees when Medicare is the primary payer for Part A and B Benefits.

27. You may propose an incentive program to support and reward healthy behavior.

28. You must meet health plan accreditation for plan operations and/or care management by a nationally recognized accrediting organization such as NCQA or URAC within 12 months after contract award.

29. You must cover intravenous/infusion drugs under pharmacy and/or medical.

30. You must establish effective management programs for formulary, drug utilization, pharmacy network, medication therapy and chronic disease management to support the delivery of quality and affordable healthcare to members.

31. You must provide a prescription drug benefit that uses an evidence-based formulary that reinforces the effective use of clinically appropriate medications.

32. Drugs prescribed for off-label use must be covered if the medication can be legally prescribed, it is supported by clinical evidence from established compendia and is consistent with generally accepted medical practice.

33. The formulary must have a minimum of four tiers and you may limit the number of formulary drugs with evidence of a sufficient number of drugs represented on the formulary in any particular class.

34. You may propose coverage for medical foods.

35. You must have a drug utilization management program that utilizes effective tools such as safety edits, prior approval, step therapy and quantity limits.

36. You must have documented coverage determination processes in place that address member and provider notification including accuracy and timeliness of notification.

37. You must have clinical programs in place to promote medication safety, adherence, proper medication use and chronic disease support.

38. You must have a pharmacy distribution channel strategy in place to provide an adequate pharmacy network.

39. You must provide active specialty drug management under both the pharmacy and the medical benefit. This includes and is not limited to utilization management, split fill programs and site of care management

40. You must have member and provider engagement and transparency tools in place to support members’ medication use.

41. You must provide creditable prescription drug coverage that is greater than the standard benefit provided under Medicare Part D.

42. You must have an opioid drug management program to address over utilization/prescribing (See Attachment X: Technical Guidance).

43. You and your pharmacy benefit manager (PBM) must adhere to the standards as outlined in the standard contract.

(D) Networks

1. Your plan must offer a nationwide provider network that meets minimum standards outlined in Section M. For in-network benefits offered, you must provide a stable, high-quality network or networks of participating providers that are available to all enrolled Federal employees living in the United States and its possessions and territories. The network must include primary care physicians, specialists, hospitals, behavioral health and ancillary providers. In addition, you may provide a retail and mail order pharmacy network.

2. Your provider contracts must contain hold harmless clauses that prevent network providers from charging members for the difference between your plan’s allowed benefit and the provider’s actual charge (balance billing).

3. An OPM priority is to minimize unnecessary out-of-network services at in-network facilities for our members, which can have significant impact on cost-sharing. Our goal is to ensure that members have access to in-network options whenever practicable and receive sufficient notices before out-of-network services are delivered. Please include in your proposal a description of how you will address this issue.

(E) Premiums

Premium Structure

1. Your premium will be established using retrospective experience rating. You will develop a rate based on existing business with a zero starting point assumption (no gains or losses to carry forward) and use the experience of the representative group, with appropriate adjustments, to build the rate for the initial year.

2. You must be able to demonstrate that you have criteria for retrospective experience rating.

3. You must be able to track FEHB claims separately from the claims for other groups.

4. You must carry over gains and losses from year to year and incorporate them into the annual rating process.

5. Your proposal must clearly indicate the amount of profit that you propose using the weighted guidelines shown in FEHBAR 1615.404-70.

6. Your proposal must clearly indicate the Contractual Expense Limitation that you propose for 2020.

7. Your proposal must reflect the potential for favorable early experience and resulting high unobligated reserve levels in the initial years. OPM is not averse to this practice as reserve levels will decrease on a relative basis due to plan growth and change in membership.

(F) Administration and Systems

1. The Carrier must have the ability to interface with the OPM Data Hub to receive enrollments and to transmit the FEHB Program Centralized Enrollment Reconciliation Clearinghouse System (CLER) carrier enrollment file. (Procedure manual available at: https://www.nfc.usda.gov/ClientServices/Insurance/services/cler/documents/file-layout-carrier.pdf, at the Pubs & Forms page left-hand menu, click the List by Title/Chapter option and locate the CLER manual for carriers under Title 10.)

2. The Carrier must ensure compliance with the Privacy Act of 1974 to protect all PII and Federal requirements to protect the privacy of individually identifiable health information and must ensure compliance with the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and associated regulations.

3. The Carrier must be willing to work with the intelligence community agencies to meet their additional security and confidentiality requirements as outlined in Attachment X, Federal Intelligence Community.

4. The Carrier must keep all records, including enrollment, claims and financial records, for the current year and an additional six years, as provided in Section 3.8 of the Standard Contract (Attachment 2), Carrier Records Retention.

5. The Carrier must have a disaster recovery plan in place that meets the requirements of Section 1.28 of the Standard Contract (Attachment 2), Carrier Disaster Recovery Plan.

6. The Carrier must encourage interoperability (the ability of different information systems, software applications and networks to communicate and exchange information in an accurate, effective, useful, and consistent manner) through the use of standard electronic medical records and the adoption of interoperability standards recognized by the Department of Health and Human Services.

7. The Carrier must have the ability to transmit a paid claims file to the Federal Flexible Savings Account vendor.

8. The Carrier must comply with all reporting requirements. See current list at https://www.opm.gov/healthcare-insurance/healthcare/carriers/#url=Routine-Reports.

(G) Customer Service

1. The Carrier must meet the customer service requirements in the Standard Contract (Attachment X), including those listed in Section 1.9, Plan Performance—Experience Rated FFS Contracts and Section 1.26 Standards for Pharmacy Benefit Management Company Arrangements.

(H) Claims Administration

The Carrier must:

1. Ensure that at least 98% of all provider claims are submitted electronically.

2. Be willing to work toward a process through which enrollees may receive automatic reimbursement for their out-of-pocket expenses from their health care flexible spending accounts (paperless reimbursement) through a seamless interface with the Federal Flexible Spending Account Program (FSAFEDS) contractor.

3. Adjudicate all requests for reconsideration of claims or encounters.

4. Comply with all claims administration provisions outlined in the Standard Contract (Attachment X).

C.3 Definitions

Special Note: The definitions contained in 5 U.S.C. Chapter 89, 5 C.F.R. Part 890, and 48 C.F.R. Chapter 16, are all incorporated by reference. The following definitions are only for the purpose of this RFP.

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