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Benefits Contract

Benefits Contract

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Published by tawnell
DISD RFP for leave and benefit services
DISD RFP for leave and benefit services

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Published by: tawnell on May 07, 2012
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05/07/2012

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DETAILED INFORMATION SHEET
Meeting Date:
May 24, 2012
Title:
CONSIDER AND TAKE POSSIBLE ACTION TO AUTHORIZE,NEGOTIATE AND ENTER INTO A CONTRACT WITH ADP TO PROVIDEBENEFITS AND LEAVE ADMINISTRATION SERVICES (NOT TOEXCEED $2,200,000.00 ANNUALLY, OVER FIVE YEARS(GENERAL FUNDS)
 
Benefits Administration Services & Leave of Absence Management
Evaluation Ranking:1. ADP2. TCG Consulting3. Houston ISD4. SECOVA5. Standard Insurance Company6. Universe Workplace Solutions7. EMPYREAN8. AON HewittThe Houston Independent School District (HISD), through an Interlocalagreement, currently provides the Benefits Administration and Leave of  Absence Management Services to the District. These services are beingprovided through Mercer Outsourcing and The Health Care Partnership(THCP). The District is currently paying approximately $4,784,000 annuallyto the HISD for these services.The current contract between the District and HISD to perform theseservices was commenced April 1
st
, 2009 and renews annually on theanniversary date of April 1
st
. The term of contract is for five years throughMarch 31
st
, 2014. The District may opt out of this contract before theanniversary date and provide 60 days advance written termination. If theDistrict were to opt out of the current arrangement with HISD effective April1
st
, 2013, there would be an early termination fee of $50,000.Due to the financial challenges facing the District, the District’s Benefits andPurchasing Departments issued a Request for Proposal (RFP) #JP-203906to determine whether the current level of services offered under the HISDInterlocal agreement warrant the present cost. The scope of services of thisRFP included: administration, operational processing, communications,technology, consulting services, and offering the District the option of hiringits own benefits staff to provide operational oversight and management of the program.Consultant, Hays Companies of Texas was engaged by the District to assistin the development of the RFP. Moreover, Hays was retained to evaluatethe submitted proposals and provide an objective evaluation to the
 
Purchasing Department and the Selection Committee. The District’s RFPprocess also included a Selection Committee comprised of District staff members from departments impacted by these services. Direction andoversight of the evaluation process was provided by the PurchasingDepartment.On March 19
th
, the District received a total of eight proposals and aproposed amendment from HISD. Hays then conducted an in-depth,objective evaluation of each of the proposals. The evaluation criteria usedby Hays to determine the ability of each vendor to provide these servicesincluded: purchase price, the reputation of the vendor, the quality of thevendor’s services, the extent to which services meet the District’s needs,the vendor’s past relationship with the District, the total annual and long-term cost to the District.The goal of the evaluation was to narrow down the proposals to three viablefinalists for the Selection Committee to evaluate. Hays identified threevendors who best met the stated objectives and evaluation criteria of theRFP. These vendors included ADP, TCG, and Secova. Hays alsorecommended the Selection Committee thoroughly consider the proposedamendment from HISD.On April 3
rd
, Hays presented a detailed analysis of the three finalists and theproposal modification to the current Interlocal agreement from HISD to theSelection Committee and Purchasing Department. It was determined thatfurther clarification was needed from ADP, TCG, and HISD regarding their proposals and ADP and TCG should be interviewed the next week.Clarifications on many proposal issues were then obtained through a seriesof questions to each vendor during the week. The Selection Committeealso agreed it would be in best interest of the District to further evaluate theoption of hiring an internal onsite benefits staff to achieve the statedobjectives as well as to provide added oversight and management for theseservices.On April 9
th
, 2012 the Selection Committee met to conduct interviews with ADP and TCG. These interview sessions served as an opportunity for theproposers to provide additional insight on the programs and servicescovered under their proposals. The proposers also provided a demo of their systems, highlighted new feature functions/service enhancements, andfurthered clarified their answers to specific questions received from thePurchasing Department on April 4th.On April 10
th
, Hays provided a summary of responses from the interviewsand an objective evaluation analysis to the Selection Committee to consider before performing their scoring evaluations. Hays also provided an updatedcost analysis comparing the option of hiring an internal onsite benefits staff rather for these services. Over the next few days the Selection Committeeperformed the evaluation using a 100 point scoring form as specified in theRFP. The 100 point scoring form was tabulated in two ways depending onwhether the District would hire its own onsite benefits staff or if the vendor provided.
 
The overall scoring as tabulated by the Purchasing Department was asfollows:DISD Hire Onsite Staff Vendor Provide Onsite Staff  ADP 79.10 79.10TCG 70.98 73.77HISD 37.68 38.57Based on the scoring evaluation and the stated objectives of this RFP, it isproposed that ADP be awarded the contract to perform Benefits Administration and Leave of Absence Management Services for the Districtbeginning April 1, 2013. Many considerations were made in the analysisthat led up to this recommendation. Some of these considerations torecommend ADP include:1. Annual cost savings of approximately $2,484,004 million or $12,420,000over five years compared to the current Interlocal agreement with HISD.2. Allow the District to remove the current onsite benefits staff beingprovided by THCP and hire its own from their proposal. The District mayhire its own benefits staff to provide enhanced operational oversight andmanagement of the program with approximate savings of $308,800.3. Offer a “Low Risk/High Reward Implementation.” This means the Districtwill not be billed for any services until the “go live” date of 4/1/2013.4. Additional service enhancements and feature functions offered to theDistrict will include:a. Decision Support Center – includes a medical cost calculator,medical benefits plan comparison tool, and FSA/HSA savingsaccount estimator.b. ADP Analytics – access the impact of decision support onenrollment, analyze member buying behavior, and adapt strategyand communications based on report findings.5. The ability to offer a comprehensive mobile technology to all Districtemployees which will be available on IOS, Apple, and Android devices.6. Greater Web system capability related to data management andenhancements of Web tools and capabilities to the District andemployees.7. Improvement of the Leave of Absence Management program whichinclude greater oversight, upgraded automated processes rather thanmanual paperwork, and value-added FMLA consulting services to theDistrict and employees8. An integrated solution – no outsourcing for technology or administrationas all will be performed by ADP.9. Familiar with TRS BCBS of TX eligibility file and will be able toaccommodate the District’s files to make a smooth transition.The components of the current contract include but not limited to thefollowing:Benefits Administration Services
Administer all insurance benefits program including Flexible Spending Accounts

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