HomeMy WebLinkAboutExhibit 3ATTACHMENT A
SPECIFICATIONS / SCOPE OF WORK
2.1 Background Information
The ,City of Miami „("Miami" ). is seeking to pre -qualify proposers (aka "Successful Proposer(s)")
based upon their credentials, experience, and expertise from which the City shall choose
prospective contractors on an as needed basis to provide professional health Benefit consulting
services and various types of actuarial services.
The health benefit consulting services required is to provide professional analysis of the City's
health benefit plans, on a monthly and quarterly basis. The City is self insured for health
insurance benefits and .needs to constantly assess the performance of the different plans. The
City's largest aspect of its budget is in this area, and the constant monitoring of expenditures and
services is necessary to make sure that Third Party Administrators (TPA's) are complying with
the different plan designs.
The actuarial services required include, but is not limited to, pension systems, health, dental and
life insurance, workers' compensation, disability, financial and budgetary analysis, plan design,
plan documents, litigation and negotiation support for the City. The Successful Proposer(s)
shall assist the City by providing risk analysis, annual actuarial report filing and assistance in
dealing with external audits and self -funded plans, claims analysis, extensive actuarial input on
GASB issues for plans that include coverage for retirees, outside review of the different
insurance carriers, setting funding and COBRA rate for self -funded plans, actuarial models
showing a range of possible outcomes, allowing the City to see the best case vs. worst case
scenario, and most likely results for each flex plan alternative, valuing assets and liabilities in
accordance with Federal, State, and Local guidelines, interpreting regulations including advice
on recent changes and best practice, setting reserves, monitoring results, determining premiums
and contribution rates, developing cost projects, evaluating reinsurance needs and assisting with
the solicitation process, assuring design is consistent with plan goals, identifying and resolving
any benefit overlaps or inconsistencies, assisting in designing RFP solicitation documents (i.e.
scope of work/services) and placement of coverage and other actuarial matters.
General categories are identified within Section 2.3, Scope of Work, of this Request for
Qualifications (RFQ). As such, Proposers, in their Response, are to dearly identify those areas
of expertise, on a per Category basis, for which they are seeking to qualify. Key personnel of the
Proposer are desirable and should be identified in its responses to the RFQ. The City shall
utilize Qualified Firms on the List, per Category, on an as needed, when needed, basis.
Qualified Firms are not guaranteed specific work assignments or quantity of work under the
categories. These Categories are not all inclusive and may be modified throughout the term of
the contract. Therefore, the City reserves the right to add more categories and qualify additional
firms under those categories or qualify additional firms under listed categories herein at any
given point in time throughout the term of contract when deemed in the best interest of the City.
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2.2 Categories of Expertise
The City recognizes expertise of a Proposer may be in one or more Categories. It is the City's
desire to secure the services of Proposers who can provide quality service in one or more areas
of need, as listed in Section 2.3, Scope of Work, and identified as "Categories of Expertise. " In
its Response, Proposers must reflect in which area(s) of expertise it is seeking to qualify under.
2.3 Scope of Work
The Successful Proposer(s) must provide health benefit consulting services and actuarial services
as stipulated by the City.
While the "Categories of Expertise" reflects subject areas where the City is seeking to qualify
Proposers with experience and expertise, the City understands that each Proposer is uniquely
qualified and may be an expert in some but not all subject areas. As a result, the City is seeking a
number of qualified Proposers for each of the main subject areas reflected in the "Categories of
Expertise". Proposers may seek to qualify for one (1) Category, more than one (1) Category, or
all Categories, depending upon its expertise, qualifications and experience. At the time of need,
the City will select a qualified Proposer from a Category, on an as needed basis, to perform.
required services.
CATEGORIES OF EXPERTISE
A general, but not limited to, description of services to be performed is provided below under the
different categories.
A. Health Benefit Consulting Services
1. Provide monthly written reports of health benefits plan performance in an approved format
by
the authorized representative of Risk Management. Health benefit plans include all
components
and includes medical, dental, prescription, savings accounts (if available/applicable),
subrogation from workers' compensation, other liability programs, and stop loss.
2. Provide quarterly management .review detailing plan performance to include at minimum
projected expenses vs. actual expenses, IBNR's (Incurred But Not Reported), reserve
practices, utilization review, explanation of differences between plans and recommended
actions to improve data collection. Provide a monthly report that expense factors, reserves
practices, loss development factors, stop loss reporting, claim payments, trends of UR
(Utilization Review), and other claims analysis.
3. Review a census report provided by the TPA on a monthly basis to verify its accuracy.
4. Prepare quarterly theoretical rates for the City with information to be provided by the TPA
and their assistance. Successful Proposer(s) shall be responsible for obtaining the relevant
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and appropriate information from the TPA. Successful Proposer(s) shall work closely with
the TPA's underwriter department, as well as the account representative assigned to the
account and a City representative.
5. Prepare written projections of value and expense based on data gathered from the City's
existing health plans.
6. Develop models based on actuarial projections on how the City's health plans should be
performing and compare to a number of variables and plan's past performance comparable to
similar plans,...
7. Suggest health plan changes to create savings and improve health plan performance.
8. Issue a written report on Actual cost comparison and performance against projected results.
Analyze plans that show that they are performing well and according to projected
performance and identify the elements that make it work.
9. Provide a semiannual fiscal year expense projection vs. actual 30 days before mid -year
City's fiscal update.
10. Work closely with City staff to assist in Risk Management and City's "end of the year"
health benefit section of a fund year report (year end Sept 30th)
11. Provide all written reports on a fund year as well as a calendar year basis.
12. Assist in evaluating Third Party Administrator (TPA) based on service, cost, and
performance. To that end, Successful Proposer(s) shall prepare a report which shows: a) a
comparison of year to date v. previous year total cost; b) Provide claims comparison of
Actives and Retirees, at the different levels based on the different plans to achieve a cost per
employee; and c) Such cost should be annualized and compared to previous year. total
contributions and total plan cost to examine net cost.
13. Provide explicitly its observations and interpretations of data regarding plans and cost in
each report. All paid claim analysis of the Medical, Prescription, Vision and any other City
plan as requested by the City shall reflect plan cost, fixed cost, administrative cost and stop
loss,
14. Complete an analysis of COBRA benefit provided by the City by cost, by different types of
plans including medical prescription and vision, by claims paid, and administrative fees to
include fixed cost and stop loss.
15. Prepare an analysis report on a monthly basis of Prescription Cost that represents usage,
over -utilization, by Active/COBRA employees and retirees/in network& out of area, and
retail v. mail order usage of prescriptions.
16. Assist in data preparation for GASB 45 and 43 on a continuous basis, by collecting the
proper data from the different vendors and groups that must provide the necessary
information for these reports.
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17. Assist the City on their plan renewals and TPA contract renewals by providing information
necessary to evaluate the proposals and contracts
18. Provide actuarial assistance as needed and upon request of the City.
19. Provide any other health benefit consulting services on an as needed, when needed basis.
B. Health Actuaries
(1) Appraisals
(a) Perform Cash Flow Testing
(b) Perform Due Diligence Analysis
(2) Cash Flow Testing
(a) Perform Cash Flow Testing in Determining Reserve Adequacy
(b) Performing Pricing Studies
(c) Evaluating Investment Strategies
(d) Developing Financial Projections or Forecasts
(e) Developing Actuarial Appraisals
(f) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(3) Expert Advice, Witness and/or Testimony
(a) Perform Analysis of Legislative Proposals in connection with actuarially related matters
(b) Provide Expert Witness Testimony in connection with actuarially related matters
(4) Financial Analysis, Projections, and Reporting
(a) Account for Post-employment/Pre-retirement Benefits
(b) Develop Financial and Other Projections
(c) Estimate Incurred Health Claim Liabilities
(d) Perform Asset Adequacy Analysis
(e) Perform Cash Flow Testing in Determining Reserve Adequacy
(f) Performing Pricing Studies
(g) Developing Actuarial Appraisals
(h) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(i) Perform Trend Analysis (including Development of Plan, Rate Setting and Liability
Determination
(j) Recognize Actuary's Responsibility to the Auditor in Connection with Preparation of
(k) Review of Audited Financial Statements
(1) Valuation of Incurred Liabilities and Other Items for Actuarial Opinions and Financial
Statements
(5) Group Benefits for Retired and Active Employees
(a) Actuarial Projections
(b) Financial Reporting for Post -Retirement Benefits
(c) Funding of Post -Retirement Benefits
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(d) Plan design, including Rate and Contribution Determination, for Pre -Retirement
Benefits
(e) Financial Reporting for, or Funding of, Pre -Retirement Benefits
(f) Provide Analysis of Managed Care, Social Insurance, Long-term Care, or Continuing
Care Retirement Communities in Connection with Post -Retirement Benefits
(6) Product Development/Ratemaking/Pricing
(a) Design, Use, and/or Update Risk Classification Systems
(b) Develop Financial and Other Projections
(c)' Develop Rates, Plan Design, Quality'. Standards, Data/Claims Analysis, for Products and
Self
funded Plans
(d) Estimate Incurred Health Claim Liabilities
(e) Perform Cash Flow Testing in Performing Pricing Studies
(f) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(g) Perform Trend Analysis (Aggregate and Components)
(h) Provide Analysis of Long-term Care Products, including Benefit Triggers, Non -forfeiture
Benefits, Loss ratios, and Rate Stabilization Parameters
(i) Provide Analysis of Medical Economics of Health Care Mechanisms, Provider Staff
Models,
Modeling Claims Expenses along Clinical Lines, Comparative Utilization
Analysis/Profiling from Provider Perspective
(j) Provide Analysis/Recommendation of Vendors for Medical, Dental, Long-term Care,
Visions, etc.
C. Life Actuaries
(1) Appraisals
(a) Perform Cash Flow Testing in Developing Actuarial Appraisals
(b) Project asset Cash Flows in connection with Actuarial Appraisals
(2) Cash Flow Testing
(a) Perform Cash Flow Testing in Determining Reserve Adequacy
(b) Performing Pricing Studies
(c) Evaluating Investment Strategies
(d) Developing Financial Projections or Forecasts
(e) Developing Actuarial Appraisals
(f) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(g) Project Asset Cash Flows in connection with Pricing Studios
(h) Reserve Adequacy
(i) Financial Projections
(j) Actuarial Appraisals
(3) Expert Advice, Witness and/or Testimony
(a) Perform Analysis of Legislative Proposals in connection with actuarially related matters
(b) Provide Expert Witness Testimony in connection with actuarially related matters
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(4) Financial Analysis, Projections, and Reporting
(a) Account for Reinsurance Transactions in Statutory, GAAP, or Other Financial
Statements
(b) Perform Asset/Liability Management
(c) Develop Financial Projections
(d) Perform Asset Adequacy Analysis
(e) Perform Cash Flow Testing in Determining Reserve Adequacy
(f) Performing Pricing Studies
(g) Developing Actuarial Appraisals
(h) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(i) Recognize Actuary's Responsibility to the Auditor in Connection with Preparation of
Review of Audited Financial Statements
(5) Post -retirement Benefits
(a) Account for Post -retirement Benefits Other than Pensions
(b) Value Retiree Death Benefits
(c) Product DevelopmentlRatemaking/Pricing
(d) Design, Use, and/or Update Risk Classification Systems
(e) Determine and illustrate Dividends for Participating Individual Life Insurance and
Annuities
(f) Performing Pricing Studies
(g) Developing Financial Projections or Forecasts
(h) Developing Actuarial Appraisals
(i) Estimate Incurred Health Claim Liabilities
(j) Testing Future Charges of Benefits that may vary at the discretion of the City of Miami
(6) Re -determine (or Determine) Non -guaranteed Charges and/or Benefits for Life Insurance
and Annuities
D. Pension Actuaries
(1) Expert Advice, Witness, and/or Testimony
(a) Provide Advice on the Selection of Assumptions for Employer Accounting Purposes
(2) Financial Analysis, Projections, and Reporting
(a) Asset/Liability Matching
(b) Employer Accounting Valuation/Expense Estimate/Financial Forecast for Pension Plan
(c) Employer Accounting Valuation /Expense Estimate/Financial Forecast for Post-
employment/Pre-retirement Benefits
(d) Funding Valuation/Cost Estimate/Financial Forecast for Pension Plan
(e) Financial Reporting for Post -retirement Benefits
(f) Funding of Post -retirement Benefits
(g) Plan Design, including Rate and Contribution Determination, for Pre -retirement Benefits
(h) Financial Reporting for, or Funding of, Pre -retirement Benefits
(i) Provide Analysis of Managed Care, Social Insurance, Long -Term Care, or Continuing
Care
Retirement Communities in Connection with Post -retirement Benefits.
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(3) Valuation Services
(a) Determine Actuarial Present Value of Accumulated Pension Plan Benefits
(b) Determine Present Value of Unfunded, Vested Benefits
(c) Employer Accounting Valuation/Expense Estimate for Pension Plan Special Income
Items
(d) Employer Accounting Valuation/Expense/Estimate/Financial Forecast for Pension Plan
(e) Employer Accounting Valuation /Expense/Estimate/Financial Forecast for Post-
employment/Pre-retirement Benefits
. . (f) Employer Accounting Valuation on !Ev
penselEstimatelFinanc>a_ Forecast or Pre -
retirement
Benefits other than Pensions
(g) Provide Advice on the Selection of Assumptions for Employer Accounting Purposes
E. Casualty Actuaries
(1) Appraisals
(2) Expert Advice, Witness, and/or Testimony
(3) Financial Analysis, Projections, and Reporting
(a) Analyze Cost of Capital Issues
(b) Asset Liability Matching & Adequacy Testing
(c) Dynamic Financial Analysis
(d) Comprehensive Annual Financial Reporting
(e) Statutory and GAAP Reporting
(f) Rating Agencies
(3) Miscellaneous
(a) Catastrophe Models- Development of Models
(b) Selection of Vendors, and Use for Portfolio Analysis and Data Management
(4) Product Deveiopment/Ratemaking/Pricing
(a) Create and Review Risk Classification Plan
(b) Determine impact deductibles, coinsurance, and insurance to value
(c) Development of risk provisions
(d) Perform individual risk ratemaking
(e) Prepare relativity filings (increased limits factors,amount of insurance relativities,
etc.)
(f) Price new coverage and programs
(g) Price reinsurance contracts
(h) Review territory definitions and relativities
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