MPSERS Dental Benefit Plan Administration

The State of Michigan's Department of Technology, Management, & Budget Procurement Office issued Request for Proposal No. 200000001290 for the administration of the Michigan Public School Employees' Retirement System (MPSERS) Dental Benefit Plan. This procurement sought a qualified Third-Party Administrator (TPA) or licensed insurance company to provide comprehensive dental benefit administration services. The primary deliverables and objectives included plan design duplication, claims processing, member communications, provider network management, and related administrative services for plan members. Required qualifications encompassed demonstrated experience in dental plan administration, adequate staffing capabilities, effective project management methodologies, comprehensive transition planning, and relevant company background and experience in similar engagements. The evaluation criteria assessed proposals across Schedule A requirements covering plan administration capabilities, staffing resources, project management approaches, transition planning strategies, company background, and relevant experience in dental benefit administration. The RFP was posted on SIGMA VSS on March 5, 2020, with a four week and four day solicitation period, and proposals were due on April 6, 2020.

Three bidders submitted proposals for consideration: Blue Cross Blue Shield of Michigan (BCBSM), Delta Dental of Michigan, and Metropolitan Life Insurance Company (MetLife). Delta Dental of Michigan, the incumbent contractor, was awarded the contract based on achieving the highest technical evaluation score of 187 out of 200 points, exceeding the minimum threshold of 160 points required for pricing consideration. BCBSM scored 153 points and MetLife scored 123 points, neither reaching the evaluation threshold. The contract term spans four years and five months with four one-year renewal options available. Delta Dental's pricing was structured as a self-insured arrangement utilizing a contract rate-variable annual rate model, with administrative fees ranging from $2.63 to $2.86 per contract per month for 2021-2024, and the total award value was $400,000,000.00 inclusive of administrative fees and claims payments. Through competitive negotiations, the State secured administrative fee reductions averaging 1-2% and achieved an additional benefit of reverting the 2020 calendar year rate to 2019 levels, generating combined estimated savings of approximately $512,074.80 over the contract term. Delta Dental's incumbent status demonstrated a robust provider network with low disruption rates of 13.7% for plan members utilizing services and strong geographic access results.