Short-Term and Long-Term Disability Benefits

The State of Colorado Department of Personnel & Administration is soliciting proposals for fully insured Short-Term Disability (STD) and Long-Term Disability (LTD) benefits administration covering approximately 39,500 state employees, with proposals due November 19, 2026 and questions due October 30, 2026 under RFP AABA 2027-0070. Service-Disabled Veteran Owned Small Businesses (SDVOSBs) are encouraged to propose and must submit certification documentation from the U.S. Department of Veterans Affairs.

The State currently pays 100 percent of STD premiums while employees pay 100 percent of LTD premiums on a post-tax basis, though the State reserves the right to modify this cost-sharing structure with notice. The scope requires comprehensive claims adjudication, claims payment, customer service, underwriting, consulting, and detailed reporting; integration with the State's benefits administration system (Businessolver) and existing payroll systems; and coordination with Colorado PERA Disability, Colorado FAMLI, and Workers' Compensation offsets. Offerors must manage return-to-work and vocational rehabilitation programs, demonstrate accessibility compliance under Colorado Revised Statutes 24-85-101 et seq. and WCAG Level AA standards, and provide a five-year rate guarantee through June 30, 2032 with a plus or minus 25 percent change caveat based on lives or volume. All work must comply with Colorado Office of Information Technology requirements and WCAG 2.1+ accessibility compliance by July 1, 2025.

The initial contract term runs April 1, 2027 through June 30, 2029, with total contract duration not anticipated to exceed five years including optional extensions at the State's sole discretion. Implementation support of $30,000 is provided by the State; the carrier is responsible for up to $40,000 in independent quality review costs and $5,000 in travel expenses. The incumbent carrier is Unum Life Insurance Company of America (Policy Nos. 419127 012 for LTD and current STD policy). Offerors must provide firm, fixed U.S. dollar pricing with separate monthly premium fees for STD and LTD, detailed benefit deviations from current plan provisions, and monthly premium rates per $100 of covered payroll for STD with a maximum weekly benefit of $3,000 and volume rates per $1,000 of monthly payroll for LTD. Oral presentations are estimated for the week of December 14, 2026; notice of intent to award for the week of December 21, 2026; and contract execution in March 2027. Proposals must remain binding for 180 days. Phil Rollins (phil.rollins@state.co.us) is the procurement contact.