The vendor is required to provide health plan for teachers and state employees (plan) is soliciting proposals from qualified companies to provide actuarial, analytical, and health benefits consulting services.
- Procurement of actuarial and analytical services to:
• Establish and update annual forecasts for plan revenues, expenditures, and cash reserves.
• Assist the plan in monitoring finances and determining annual premium increases necessary to meet projected expenses.
• Enable the plan to establish a budget that maintains solvency within the parameters established by the state budgeting process.
• Conduct other financial analysis as needed by the plan and the board of trustees.
- Procurement of health benefits consulting services to assist the board of trustees, the state treasurer, and the plan with:
• Strategic planning;
• Program development;
• Contract procurement; and
• Benefit design and management.
- The vendor shall confirm each of the following:
• The vendor has been in existence for at least seven (7) years; and
• The vendor is a professional actuarial services firm with a minimum of five (5) years of prior experience performing responsibilities substantially the same as the services listed under for public sector entities offering health benefits through insured and self-insured products and covering one hundred thousand (100,000) or more lives.
- The vendor shall confirm each of the following:
• Lead actuary is a fellow of the society of actuaries (“FSA”);
• Lead actuary has a minimum of seven (7) years of experience performing responsibilities substantially the same as the services listed.
• Lead actuary, during the seven (7) years, has a minimum of five (5) years’ experience performing services for at least one (1) large public sector plan that covers one hundred thousand (100,000) or more lives, where the majority of covered lives are enrolled in self-insured health plans; and
• Lead actuary is readily available to begin work on the plan’s actuarial needs as requested by the plan
- The vendor shall confirm and describe each of the following:
• Lead health benefits consultant has a minimum of seven (7) years of health benefits consulting experience for private sector or public sector plans covering one hundred thousand (100,000) or more lives; and
• Lead health benefits consultant has a minimum of three (3) years of additional direct industry experience, such as with an insurance company or healthcare provider.
- The vendor shall confirm each of the following:
• Secondary actuary is an associate of the society of actuaries (ASA) or an FSA;
• Secondary actuary has a minimum of five (5) years of experience performing responsibilities substantially the same as the services listed.
• Secondary actuary, during the five (5) years, has a minimum of three (3) years’ experience performing service for at least one (1) large public sector plan that covers one hundred thousand (100,000) or more lives, where the majority of covered lives are enrolled in self-insured health plans; and
• Secondary actuary is readily available to begin work on the plan’s actuarial needs as requested by the plan.
- The vendor shall confirm and describe the following:
• Senior health benefit consultant is a fellow of the society of actuaries (FSA);
• Secondary health benefit consultant has a minimum of seven (7) years of experience performing responsibilities substantially the same as the services listed health benefits consulting tasks/deliverables of this RFP;
• Secondary health benefit consultant, during the seven (7) years, has a minimum of five (5) years performing continuous service for at least one (1) large public sector plan that covers one hundred thousand (100,000) or more lives, where the majority of covered lives are enrolled in self-insured health plans; and
• Secondary health benefit consultant is readily available to respond to the plan’s health benefit consulting needs.
- The vendor shall confirm and describe the following:
• Lead clinical consultant has a minimum of three (3) years of clinical experience in a health care setting and at least five (5) years of healthcare consulting experience; and
• Lead clinical consultant is an r.n., m.d., r.ph., p.a., or D.O.
- The vendor shall confirm and describe the following:
• Supporting subject matter experts (“SME”) and consultants have at least five (5) years of demonstrated experience in a clinical health care setting and health care benefits consulting, combined.
- The vendor shall confirm that it agrees to comply with the actuarial code of professional conduct and applicable actuarial standards of practice as set by the actuarial standards board without exception.
- The vendor shall certify without exception the sufficiency of its security standards, tools, technologies, and procedures in providing services under this contract.
- All vendor and/or third-party data centers, business applications or systems used under this contract for the purpose of collecting, storing, processing, transmitting, or exchanging plan data shall have, and maintain, valid, favorable third-party security certifications or assessment reports on all related security controls that are consistent with, and can be cross-walked to, the data classification level and security controls appropriate for moderate information system(s) per the national institute of standards and technology (“NIST”) SP 800-53 rev. 5 or the most recent revision.
- To satisfy this requirement, such reports must have been issued within twelve (12) months prior to the anticipated contract award date or be supplemented by bridge letters covering no more than three months subsequent to the report expiration date.
- The vendor shall provide a crosswalk document along with full unredacted copies of the third-party security certification or assessment reports, and any necessary bridge letters.
- The vendor shall also identify which specific data centers; business applications or systems are covered by the third-party opinions or attestations will be used to provide the services under this contract.
- Opinion letters or security certification attestation letters will not be submitted in lieu of full report(s).
- The vendor hereby agrees that the plan has the right to independently evaluate, audit, and verify such requirements as part of its evaluation and during the life of the contract, including requesting the performance of a penetration test with satisfactory results.
- The plan will verify any such third-party security opinions or attestations yearly during the life of the contract, and the vendor will be required to provide an updated report or bridge letter verifying that there have been no material changes in the controls reported since the issuance of the last report.
- Bridge letters will only be accepted for three months after the report expiration date to satisfy this requirement.
- The vendor shall agree that the plan has the right to, based upon its evaluation, require that the vendor maintain cyber breach liability insurance coverage in an amount specified by the plan and commit to obtaining a favorable third-party opinion or attestation within a time period specified by the plan as a condition of contract award.
- The vendor shall provide documentation of the amount of cyber breach liability insurance that it currently carries for all vendor and/or third-party data centers and systems used to provide the services under this contract that will contain plan data.
- If the vendor is currently undergoing a third-party NIST SP 800-53 rev. 5 compliant security assessments of such data centers or systems, the vendor shall provide proof of purchase or a copy of its contract with the third party retained to perform the audit and the expected date for completion.
- The plan understands that security assessment reports and security information provided to the plan for the purpose of this contract may contain confidential information and trade secrets.
- Instructions to the vendors for information regarding the treatment of confidential information.
- Actuarial and analytical services
1. Financial projections
a. Overview and expectations. the plan seeks a vendor that can:
• Provide a cash-based financial projection for projecting revenues and expenses of the plan at least monthly or more frequently upon request of the plan.
• The format and due date for financial projections shall be agreed upon with the plan;
• Review, monitor, and analyze the plan’s revenues and medical and pharmacy claims experience compared to projections and evaluate underlying trends and variations on an on-going basis.
• The plan will provide monthly financial statements reflecting actual experience.
• In addition, other financial and operational reports and data will be made available to the vendor to assist in identifying and explaining variances in revenues or costs and fluctuations in trends; provide an executive summary letter with the financial projection at least quarterly or more frequently upon request of the plan
• Meet the time period and other elements for the financial projections specified by the plan.
• The time period typically covers a three (3) to five (5) year time horizon, broken down on an annual and monthly basis; and
• Include employer and employee contributions for each plan option and a breakdown of membership by active, non-medicare retiree, and medicare retiree and by state funding source in the financial projections.
b. The vendor shall confirm it can:
• Prepare financial projections as required by the plan;
2) disclose and explain the underlying assumptions used in developing the projection and the sources of data;
• Notify the plan of significant changes in assumptions and differences or variances in financial projections compared to the previous quarters or other applicable projections prepared by the vendor;
• Provide an explanation of the methodology (i.e., calculation) for projecting each component of the forecast, including but not limited to premium receipts, federal subsidies, and other revenues as well as medical claims, pharmacy claims, premium payments for fully insured products offered by the plan, administrative fees, and any offsetting rebates or recoveries;
• Assess the financial impact of any proposed product or benefit changes as requested by the plan;
• Assess the financial impact of any proposed changes to member or employer premiums as requested by the plan;
• Include in the executive summary, sensitivity analyses of major assumptions made in the projections;
• Collaborate with the plan regarding the exhibits and the information presented to the plan.
• The vendor should be able to provide the requested exhibits if reasonable and promptly communicate when it cannot;
• Assign staff with the capability and expertise to work with SQL server or other software as designated by the plan;
• Provide all SQL server or other coding related to plan data at the request of the plan;
• Work with data extracts or software for data extracts provided by the plan;
• Open data extracts provided to the vendor within 10 business days of receipt of the data extract and provide confirmation of received data and the vendor’s ability to access and use the data; and
• Provide any financial forecasts and calculations in an excel file with formulas at the request of the plan.
• Include an attestation signed by the lead actuary certifying the lead actuary’s approval and the soundness of the financial projections prior to the submission of financial projections to the plan.
• The attestation shall include at a minimum the elements provided in the model attestation below. this attestation is not intended to supersede or replace any attestation required by professional standards, law, or regulation.
• Additional language or explanation may be added to enhance this attestation if necessary to meet such professional standard, law, or regulation.
c. The vendor shall describe:
• Its expertise and overall approach to financial forecasting that will be provided to the plan;
• Its experience in performing cash-based projections, as opposed to projections based on incurred costs.
• Include in the response the difference in methodology used by the vendor for projections on a cash basis versus incurred basis;
• Data and other requirements and anticipated cooperation needed by the vendor from the plan or other plan vendors;
• Data sources and processes used by the vendor to identify potential risk factors in the general healthcare environment or that are unique to the plan that may adversely affect a projection; and
• How it identifies cost drivers by segment and provides comparisons to the overall industry, comparisons to peer clients of similar size, and potential strategies for mitigating cost drivers.
d. Upon request from the plan, a vendor shall provide:
• Sample financial projection report.
2. Actuarial notes for state legislation affecting the plan
a. Overview and expectations. the plan seeks a vendor that can
• Prepare actuarial notes for proposed legislation affecting the plan in some capacity;
• Refer and adhere to N.C.G.S. § 120-114 for the specific guidelines and penalties involved with providing actuarial notes; and
• Provide actuarial notes in compliance with N.C.G.S. §§ 120-129 through 120-131, which provide for the confidentiality of legislative communications.
b. The vendor shall confirm it can:
• Upon request from the state general assembly’s fiscal research division, prepare actuarial notes by the vendor’s lead actuary, or by the secondary actuary upon approval of the lead actuary in compliance with state law;
• Submit each actuarial note for the plan’s review prior to the legislative deadline, within ten (10) state business days of the note request or as otherwise specified by the fiscal research division or the plan; and
• Include an attestation signed by the lead actuary certifying the financial soundness of the note, which contains at a minimum the elements provided in the model attestation below.
• This attestation is not intended to supersede or replace any attestation required by professional standards, law, or regulation. additional language or explanation may be added to enhance this attestation if necessary to meet such professional standard, law, or regulation.
• Including all calculations and formulas, is mathematically sound and that all assumptions are pay fines outlined in N.C.G.S. § 120-114 in addition to being subject to the performance guarantees described in performance guarantees, and reduction in fees.
c. The vendor shall describe:
• Its experience and expertise in preparing actuarial notes or similar estimates and overall approach to preparing actuarial notes;
• How it determines what data and other requirements and anticipated cooperation from the plan and plan vendors are necessary to prepare actuarial notes;
• Its process for developing costs for new benefits; and
• Sources used for researching new benefits with limited precedent or available data.
d. The vendor shall provide:
• A sample of an actuarial note or similar document prepared by the vendor on behalf of a public sector health plan of similar size to the plan, or other similar actuarial analysis if a note is not available.
3. Loss ratios and trend analyses
a. Overview and expectations
• Calculate and report to the plan on loss ratios for the plan and for subpopulations of plan members as requested by the plan. loss ratio calculations will cover time periods requested by the plan; and
• Calculate and report medical and pharmacy claims trends, as well as other expense categories as requested by the plan.
• Trend analyses shall be conducted for subgroups of plan members, health systems, provider groups, and conditions as requested by the plan and shall cover time periods requested by the plan.
• Trends also shall be provided on an incurred and paid basis at the request of the plan.
b. The vendor shall describe:
• Its expertise in calculating, analyzing, and reporting loss ratios and claims trends;
• Its methodology to develop loss ratio calculations including how costs are split into subpopulations;
• Its assumptions that are typically made for loss ratio calculations;
• Its methodology to develop trend analysis; and
• Its assumptions that are typically made for trend analysis.
c. The vendor shall provide:
• A work sample of a loss ratio report it completed on behalf of a client; and
• A work sample of a trend analysis report it completed on behalf of a client.
- Actuarial and analytical services on a per project basis
1. Incurred but not reported claims report
a. Overview and expectations. the plan seeks a vendor that can:
• Prepare an actuarial report estimating the required reserve for incurred but not reported (“IBNR”) claims liability for medical claims, pharmacy claims, or any other component of claim’s expense as required by the plan, as of June 30th of each year beginning with the fiscal year ending on June 30, 2026;
• Provide the report to the plan by august 3rd of each year for the prior state fiscal year ending June 30th, or at another preparation date determined by the plan, with the report jointly approved by the vendor’s lead actuary and secondary actuary;
• Ensure quick turnaround of the report to meet the state’s deadline for year-end close out and financial report preparation; and
• include in the report a review of the prior year estimate against actual results with explanations of any deviations.
b. The vendor shall confirm it can:
• Quickly turn around the IBNR report after receiving, on or about July 10th, the claims triangulation/lag report for the prior fiscal year ending June 30th;
• Prepare the IBNR reserve estimate report to the plan by august 3rd of each year and ensure it is jointly approved by vendor’s lead actuary and secondary actuary; and
• Include an attestation by the lead actuary certifying the accuracy of the calculations and the soundness of the estimates, which contains at a minimum the elements provided in the model attestation below.
• This attestation is not intended to supersede or replace any attestation required by professional standards, law, or regulation.
• Additional language or explanation may be added to enhance this attestation if necessary to meet such professional standard, law, or regulation.
c. The vendor shall describe:
• Its experience and expertise in preparing IBNR reserve estimates;
• Its methodology and assumptions used for estimating the liability from claims lag; and
• data and other requirements and anticipated cooperation needed by the vendor from the plan and plan vendors.
d. The vendor shall provide:
• A sample of an IBNR reserve estimate report; and
• A list of states and other large government entities for which the vendor has completed IBNR reserve
estimates.
2. Actuarial attestation of the plan’s prescription drug coverage
a. Overview and expectations. the plan seeks a vendor that can:
• Provide an annual actuarial attestation of the plan’s prescription drug coverage confirming the actuarial value is at least equal to the actuarial value of medicare part d defined standard prescription drug coverage
b. The vendor shall confirm it can:
• Prepare the attestation by the vendor’s lead actuary, or by the secondary actuary upon approval of the lead actuary, by august 31st of each year for the upcoming calendar year.
c. The vendor shall describe:
• Its experience in preparing annual actuarial attestations of medicare part d coverage;
• Its process to determine the actuarial value of the prescription plan;
• How it ensures the attestation is completed on a timely basis; and
• Data and other requirements and anticipated cooperation needed by the vendor from the plan and/or plan vendors.
d. The vendor shall provide:
• A list of states for which the vendor has prepared medicare part d attestations to comply with 42 cfr § 423.884(d); and
• A sample of an attestation prepared by the vendor for a state or other large governmental entity.
- Potential types of health benefits consulting services
a. Overview and expectations. the plan seeks a vendor that can:
• Assist with ongoing strategic planning, health plan and program development and evaluation, and the presentation and communication of ideas to the plan, the department, the board, members, and other stakeholders; and
• Provide a variety of health benefits consulting services during the contract term.
b. The vendor shall confirm it can:
• Engage in projects assisting the board and the plan with monitoring implementation of the strategic plan and consulting on strategic initiatives;
• Use its experience with new program design, network design, or health benefit plan development, including premium strategy, for the following types of health plan programs:
a) Health savings accounts with high deductible health plans;
b) Health reimbursement arrangements with or without high deductible health plans;
c) Medicare retiree plans, such as but not limited to medicare advantage, employer group waiver plans
(“EGWP”), and medicare supplement plans;
d) Health plans incorporating value-based benefits;
e) Accountable care organizations or other alternative provider arrangements;
f) Alternative payment models;
g) Direct contracting models;
h) Tiered network structures;
i) Incentive programs to encourage healthy lifestyles and utilization of high quality, low-cost providers; and
j) Regional approaches to the items mentioned above.
• Use its experience to analyze additional benefits, or changes to current benefit plans, including but not limited to, changes to current copayments, coinsurance, or deductibles, as well as new benefits, imposing new limitations on a benefit plan, eliminating a benefit or an entire benefit plan or program, or tiered copays;
• Inform the plan regarding any impact to the plan due to the patient protection and affordable care act
(PPACA) or other federal or state legislation or regulation.
• This will include education and orientation to pertinent new laws and regulations including, long term analysis and recommendations regarding plan strategies as health insurance exchanges, and employer penalties, as new strategies emerge to respond to the changing healthcare landscape;
• Engage in prospective and retrospective analysis projects including, but not limited to:
a) Prospective development of return-on-investment (ROI) models for incentive programs, pilots, and other types of programs;
b) Evaluation of existing vendor ROI models for performance evaluation purposes;
c) Assisting in the development of measures of success for vendor or pilot programs;
d) Wellness program development and analysis, including fit with strategic plan, vendor evaluation, health promotion criteria and priorities, assessment of long-term savings potential, and ROI calculation and monitoring;
e) Communications with plan members, including open enrollment materials, on-line tools and visuals, and member experience surveys; and
f) Other health benefits consulting services projects, as determined by the plan.
• Provide health benefits consulting services as requested by the plan
c. The vendor shall describe:
• Its experience with the following types of projects, including the methodology for completing the project, what typical assumptions are made, and, where applicable, what outside resources are available:
a) Projects assisting states, governing boards or bodies, and employers with strategic planning and development;
b) New program design or health benefit plan development;
c) Tiered network arrangements;
d) Regionalized benefit offerings;
e) Analysis of benefit changes to existing plans;
f) Analysis of federal and state legislation;
g) Prospective and retrospective analysis projects;
h) Wellness program development and analysis;
i) Member communications;
j) RFP technical analysis;
k) RFP cost analysis;
l) PBM market check analysis;
m) Alternative payment models; and
n) Any other types of health benefits consulting projects the vendor may recommend.
d. The vendor shall provide:
• Sample client reports prepared by the vendor in at least three (3) of the project categories in order to sufficiently demonstrate the vendor’s ability to provide the requested services and deliverables
- Requirements for the engagement of health benefits consulting services
a. Costs
• If the plan requires any health benefits consulting services that are expected to cost more than $8,000.00, the plan will request a cost estimate for the project based upon the plan’s stated requirements.
• Cost estimates submitted by the vendor shall be based on the time required for each project and reimbursed at the hourly rate provided in the vendor’s cost proposal or other rates, agreed upon by the plan and the vendor.
• Invoices should identify the cost of health benefits consulting projects.
• If a project is intended to cost less than $8,000.00, but exceeds that amount, the vendor must submit a cost estimate to the plan for total project costs prior to invoicing for costs exceeding $8,000.00.
b. Project or engagement proposal exceeding $8,000.00
• Additionally, the vendor shall provide a project or engagement proposal that shall cover anticipated services exceeding $8,000.00 and required deliverables.
• The proposal shall reflect the time period to be determined by the plan for the project; and
• The proposal shall include the following categories unless otherwise requested by the plan:
a) Services covered: this section will include a detailed listing of all services and deliverables to be completed during the time period covered by the work plan;
b) Projected meetings and milestones and key deadlines: this section will demonstrate the anticipated timeframe for completion of the services and deliverables that will be integrated into the work plan, including deadlines that are achievable and meet the needs of the plan; and
c) Estimated fees: this section will provide the vendor’s estimation of the cumulative hours to be spent completing the projects as well as a breakdown of personnel and skill level of all contributing individuals, regardless of time spent or task.
c. Agreement
• All engagements and services exceeding $8,000.00 shall be agreed upon in writing, via a LOA or similar document executed by both parties, prior to the commencement of work.
• The vendor will not be reimbursed for work performed prior to or outside the scope of the written agreements for health benefits consulting services
d. The vendor shall confirm:
• It will provide the plan a detailed proposal outlining the agreed upon deliverables, estimated cost, and assigned personnel for any requested health benefits consulting services.
- Contract Period/Term: 7 Month
- Questions/Inquires Deadline: March 7, 2025