State of Connecticut

This page was last updated on: April 15, 2011

REQUEST FOR PROPOSAL (RFP)
FLEXIBLE SPENDING ACCOUNT PROGRAM
THIRD PARTY ADMINISTRATION

I. STATEMENT OF OBJECTIVES

The State of Connecticut, Office of the State Comptroller’s (OSC) Vendor Advisory Committee (VAC), will be considering submissions from vendors qualified to serve as a Third Party Administrator (TPA) for its Flexible Spending Account Program (FSA). The FSA Program consists of the Dependent Care Assistance Program (DCAP), Transportation Fringe Benefit Program and new Health Care Flexible Spending Account Program respectively. Interested vendors must be thoroughly knowledgeable in Flexible Health Care Spending Accounts in accordance with Sections 132, 129, 105 and 125 of the Internal Revenue Code of 1986 and the regulations promulgated thereunder and will be required to provide setup, administration and management to the FSA Program. It is expected that one contract will be awarded to a single successful bidder and will encompass all aspects of the RFP; however, we reserve the right to award additional contracts if in the best interest of the state. For the purposes of this RFP, we anticipate that this contract will be written for services for the 2006, 2007, 2008 and 2009 Plan years, and the successful bidder(s) should be prepared to begin work by January 1, 2006. The OSC further anticipates the contract will include a clause that reserves the right to renew the contract for up to an additional one year period at the conclusion of the contract term. This right will be exercised solely at OSC’s discretion.

II. BACKGROUND

In accordance with Sections 5-141e, 5-264b and 5-264d of the Connecticut General Statutes, the OSC is charged with the responsibility for establishing and maintaining an FSA Program for its DCAP, Transportation Fringe Benefit and Health Care Flexible Spending Account Programs for state employees pursuant to Sections 132, 129, 105 and 125 of the Internal Revenue Code of 1986 and the regulations promulgated thereunder. The purpose of the FSA Program is to make available tax savings for eligible dependent care expenses, eligible transportation and parking expenses and eligible medical expenses not covered by the State health insurance program.

III. SCOPE OF WORK

Under the FSA Program, the Comptroller or program administrator upon receipt of the written request of the employee will establish and maintain a flexible spending account in accordance with an employee's election of any of the programs offered under the FSA Program. The Comptroller will reduce the salary of such employees by the amount designated in such requests. Such amounts will be transferred to the employee’s flexible spending account and will be used to reimburse the employee’s eligible flexible spending expenses in accordance with the provisions of Sections 132, 129, 105 and 125 of the Internal Revenue Code and the regulations promulgated thereunder.

The OSC will utilize the services of the contractor to provide setup, administration and management of the FSA Program pursuant to Sections 132, 129, 105 & 125 of the Internal Revenue Code and the regulations promulgated thereunder. Start up of the FSA Program is expected to begin January 1, 2006 depending on the outcome of the implementation timeline. Employee participation in the FSA Program is entirely voluntary. Employees electing to participate with the FSA Program will bear the entire cost; no employer contribution is contemplated. The selected administrator will report to the Retirement & Benefit Services Division, Employee Benefits Unit.

IV. EXPECTED RESULTS

The contractor is expected to respond to the following requirements: 

  1. Establishing an FSA Program pursuant to Sections 132, 129, 105 & 125 of the Internal Revenue Code and the regulations promulgated thereunder including the development of enrollment and processing procedures.
  2. Processing and development of enrollment applications pursuant to Sections 132, 129, 105 & 125 of the Internal Revenue Code and the regulations promulgated thereunder.
  3. Processing of all claim reimbursements pursuant to Sections 132, 129, 105 & 125 of the Internal Revenue Code and the regulations promulgated thereunder.
  4. Responding promptly and accurately to all claim inquiries.
  5. Establishing and carrying out marketing of the FSA Program.
  6. Operating a State specific toll free hotline during open enrollment period and throughout plan year.
  7. Mailing enrollment material during open enrollment period and throughout plan year.
  8. Establishing a direct deposit system for participant deposits and reimbursements.
  9. Providing participants with a reporting system that allows the production of weekly account statements including but not limited to account balance, account deposits, account claims total, account remaining election totals.
  10. Provide the State with necessary reporting including, but not limited to, annual forfeiture reporting.
  11. Developing and distributing a Plan Document.
  12. Conduct Discrimination Testing.
  13. Conform to and process current and future federal/state reporting requirements.
  14. Transfer of information to and from State of Connecticut Core-CT PeopleSoft system.
  15. Advise the State on resolution of matters of claim disputes pursuant to Sections 132, 129, 105 & 125 of the Internal Revenue Code and the regulations promulgated thereunder.
  16. Development of State specific FSA program web site.
V. LEVEL OF ACTIVITY

 The State of Connecticut currently employs approximately 60,000 state employees of which approximately 50,000 would be eligible for the FSA Program. The DCAP currently has approximately 800 participants. The Transportation Fringe Benefit Program currently has approximately 100 participants. It is unknown at this time what the level of participation will be for the Health Care Flexible Spending Account.

VI. PROPOSAL SUBMISSION REQUIREMENTS

  1. A letter of intent is required. The purpose of this letter is to indicate the contractor’s intention to respond to this RFP. This letter of intent must be received at the offices of the Retirement & Benefit Services Division by 4:30 pm on November 4, 2005. Proposals will not be accepted if this requirement is not met.
     
  2. In this letter the contractor must provide an email address for the communication of information about the RFP. As indicated below contractors may submit questions regarding this RFP by email. Answers to questions submitted as well as other information related to the contractor selection process will be provided to contractors at the email address provided in the letter of intent. 

  3. The Contractor shall submit an original plus ten (10) copies of its proposal in loose-leaf binders. Proposals shall be submitted to:
  4. STATE OF CONNECTICUT
    Office of the State Comptroller
    Attention: Araceli Alvarez
    Associate Retirement & Benefits Officer
    Retirement & Benefit Services Division
    55 Elm Street
    Hartford, CT 06106 

  5. Contractors who may have questions regarding the proposal must submit them in writing addressed to the VAC at: osc.fsaprgm@po.state.ct.us by November 7, 2005. It is expected that the VAC will provide responses to those questions submitted by the deadline date by November 10, 2005. No phone calls will be accepted relative to this RFP.
  6. Final proposals must be in writing and received before the close of business, 4:30 p.m., November 21, 2005.
  7. Proposal should include the following:

The title page should indicate the date, subject, name of the contractor, address, telephone number, name and title of contractor’s contact person.

A description of the office that would support the State’s activities, including its geographic location, staffing level, the background, experience, and qualifications of personnel, as well as other available resources.

A description of your experience specific to the services requested in this RFP. List all other Government Agencies, Corporations, and Organizations that you have provided these services for in the past two (2) years. The profile should not exceed four (4) pages.

Names, addresses, and phone numbers of individuals who can serve as references for the contractor should be provided. References should be contract managers who have worked directly with the respondent in engagements relevant to the scope of work proposed in this contract.

Samples of reports, policy and procedural recommendations, memoranda, etc., from previous consulting engagements relevant to the scope of work proposed in this contract may be attached to the proposal. It is only necessary to submit one copy of each sample for consideration.

The contractor will submit a detailed line item budget with narrative for each of the four (4) years. The budget should include all personnel and non-personnel costs associated with the implementation and ongoing operations under this contract.

The State of Connecticut is not responsible for any costs incurred by any party in responding to this RFP.

The Proposal must include a summary of the contractor’s experience with Affirmative Action. This information is to include a summary of the contractor’s affirmative action plan and the contractor’s affirmative action policy statement.
Regulations of Connecticut State Agencies Section 46a-68j-30(10) requires agencies to consider the following factors when awarding a contract that is subject to contract compliance requirements:

    1. The contractor’s success in implementing an affirmative action plan;
    2. The contractor’s success in developing an apprenticeship program complying with Section 46a-68-1 to 46a-68-17 of the Connecticut General Statutes, inclusive;
    3. The contractor’s promise to develop and implement a successful affirmative action plan;
    4. The contractor’s submission of EEO-1 data indicating that the composition of its work force is at or near parity when compared to the racial and sexual composition of the work force in the relevant labor market area; and
    5. The contractor’s promise to set aside a portion of the contract for legitimate small contractors and minority business enterprises, where applicable. (See CGS 32-9e)
  •  Notification to Contractors" Form

A "Notification to Contractors" form is attached, which should be read and signed by the contractor. (Attachment I)

  • Contract Compliance Requirement Reporting Form

Attached is a Contract Compliance Requirement Reporting Form, that the contractor must complete and sign, which will be sent to the Commission on Human Rights and Opportunities by the awarding agency. (Attachment II)

  •  Gift Affidavit

    The Contractor is required by the Office of the State Comptroller to provide an affidavit detailing campaign contributions and any gifts, as that term is defined in Section 1-79(e) of the general statutes, given to officers or employees of the Office of the State Comptroller or any member of the Vendor Advisory Committee for the two year period preceding the issuance of the Request for Proposals. The affidavit is required to be submitted as part of the contractor's proposal.

    The gift affidavit is provided as Attachment III to this RFP.

    At the contractor’s option, an Executive Summary may be included in the Proposal.

VII. INSTRUCTIONS TO CONTRACTORS

All responses to this RFP must conform to these instructions. Failure to conform may be considered appropriate cause for rejection of the response.

Delivery of Responses – RFP responses must be in sealed envelopes upon which a clear indication has been made of the RFP reference title, as well as the date and time the bid is due. The name and address of the vendor must appear on the envelope. FAX responses are not acceptable.

Structure of Response – Contractors must structure the responses as outlined in this RFP.

Inclusion of Taxes in Prices – The State of Connecticut is exempt from the payment of excise, transportation, and sales taxes imposed by the Federal Government and/or the State. Such taxes must not be included in the prices.

Signature and Responsible Persons – The Proposal must provide name, title, address, and telephone number for individuals with authority to negotiate and contractually bind the contractor, and for those who may be contacted for the purpose of clarifying the information provided with the Office of the State Comptroller. While companies may designate representatives to submit proposals, it is the policy of the State Comptroller’s Office, with respect to products under the FSA Program, to contract only with carriers selected to provide coverage.

"Not to Exceed" Quotations – All cost estimates will be considered as "not to exceed" quotations.

There will be no contractors’ conference.

VIII. CONDITIONS

Any prospective contractor must be willing to adhere to the following conditions and must positively state them in the Proposal:

IX. EVALUATION OF PROPOSALS
 

Criteria

Each Proposal will be evaluated by a screening committee against the following criteria to determine which contractor is most capable of implementing the State’s requirements.

X. RIGHTS RESERVED TO THE STATE

The State reserves the right to award in part, to reject any and all Proposals in whole or in part, to waive technical defects, irregularities and omissions if, in its judgement, the best interest of the State will be served.