Administrative Services Only to Perform as Third-Party Administrator for the State's The Tennessee Plan (a self-insured supplemental medical insurance plan for retirees with Medicare) - UPDATED

The State of Tennessee, through the Department of Finance and Administration's Division of Benefits Administration, is seeking a third-party administrator (TPA) for The Tennessee Plan, a self-insured supplemental medical insurance program for Medicare retirees. The Request for Proposals (RFP) #31786-00187 aims to secure administrative services for this plan, with the current contract with UMR, Inc. expiring on June 30, 2028. The selected contractor will be responsible for comprehensive administrative functions including claims processing, member communications, call center services, and maintaining HIPAA compliance. The evaluation process will be multi-faceted, with a scoring methodology that allocates 10 points for general qualifications and experience, 40 points for technical qualifications and approach, and 50 points for the cost proposal. Key deliverables include weekly claims payment processing, subrogation recovery, and adherence to a detailed Service Level Agreement (SLA) Scorecard. The RFP timeline indicates that responses are due by December 10, 2025, with a Notice of Award expected on February 26, 2026. Implementation activities will occur from April 2026 through December 2026, with benefits coverage running from January 1, 2027, through December 31, 2031, and a claims run-out period extending through December 31, 2033.

The RFP does not explicitly mention specific set-aside designations or restrictions on respondent types. The current incumbent is UMR, Inc., and the plan is designed exclusively for qualified state retirees who began employment prior to July 1, 2015, and are eligible for Medicare Part A. The enrollment history shows a steady growth from approximately 23,642 members in 2007 to 48,059 members in July 2025, with a consistent annual increase of 1,500-2,000 members. Claims history data indicates annual plan costs have been increasing by approximately 4%, with total paid amounts showing peaks in 2022 and 2023. The contract will be compensated through monthly per-member-per-month (PMPM) rates, with the maximum contract liability determined by the best-evaluated cost proposal. While specific budget ranges are not explicitly stated, the claims history spreadsheet suggests an annual claims volume in the tens of millions of dollars, indicating a substantial contract opportunity for the selected TPA.