WCHCN Request for Proposal

State Office of

Risk Management

Request for Proposal for

WORKERS’ COMPENSATION HEALTH CARE NETWORK SERVICES

CLASS / ITEM

948-07 Health Administrative Services

948-47 HealthCareCenter Services

948-48 HealthCareCenter Services (otherwise not classified)

948-55 Medical and Laboratory Services (Non-Physician)

958-56 Health Care Management Services

12/7/2007

PROPOSAL SUBMISSION DUE DATE: 03/28/08

Table Of Contents

SectionItem Page No.

Request for Proposal Cover Sheet 01

Summary 03
General Information 06
Contents of Proposal 18
Proposal Evaluation Criteria 41
Order of Return Instructions 42

Exhibit ItemPage No.

1.Proposal Checklist 44

2.Execution of Proposal Form45

3.HUB Subcontracting Plan (HSP)47

4.Exemplar Contract48

5.Reference Demographics77

Workers’ Compensation Health Care Network Services RFP

STATE OFFICE of RISK MANAGEMENT

Request for Proposal Cover Sheet

This RFP must be received on or before the return date and time specified herein.

DISCLOSURE STATEMENT: The Office of the Attorney General (OAG) is acting as an agent on behalf of the State Office of Risk Management (SORM) for this procurement. The OAG and SORM will be referenced throughout this RFP document.

NOTES:

(1) A pre-proposal conference will be held in the SORM Main Conference Room, 300 West 15th Street, 1sth Floor, Room 103, Austin, Texas78701 on Wednesday, January 16, 2008at 9:00 a.m.

(2) All proposals submitted in response to this solicitation shall be valid for a period of 180 days from date of submission.

(3) Late responses willnot be considered.

(4) Award(s), if any, will be made in the best interest of the State.

Submit Sealed Proposal to:

State Office of Risk Management
c/o Office of the Attorney General
Attn: Alma Torres, Purchaser
PO Box 12039
Austin, Texas78711-2039 / Or:
Hand Delivery or Express Mail to:
Office of the Attorney General
300 W. 15th St., 3rd Floor, Rm 301B
Austin, Texas78701
Attn: Alma Torres
Reference Number: [479-8-0002]
Workers’ Compensation Health Care Network Services RFP
Return by: 12:00 Noon, C.S.T. Friday, March 28, 2008.

(Cont.)
STATE OFFICE of RISK MANAGEMENT

Request for Proposal Cover Sheet

RESPONDING PROPOSER:

(To be completed by Vendor. Please print.)

Proposer Name:
Address:
City, ST, Zip:
Phone No.:
Fax No.:
E-mail:
Texas Vendor ID Number (TINS):
Employer Identification # (EIN/Federal Tax identification number):

The Proposer’s authorized agent must sign below and return this signed page with the Proposal. By signing this document, the Proposer acknowledges that it has read this RFP carefully and completely, and that all the information contained in the submitted documentation is true and correct. Failure to sign and date will disqualify this Proposal.

______

Signature of Authorized Agent

______

Printed Name of Authorized Agent

______

Printed Title of Authorized Agent

______

Date

Workers’ Compensation Health Care Network Services RFP

I. Summary.

A.Overview.

1.Pursuant to Chapters 412 and 501 of the Texas Labor Code,the State Office of Risk Management (SORM) provides workers’ compensation insurance coverage and risk management services for all State of Texas agencies, with the exception of the Texas A&M System, the University of Texas System, and the Texas Department of Transportation.

2.SORM’s mission is to provide active leadership to enable State of Texas agencies to protect their employees, the general public, and the state’s physical and financial assets by reducing and controlling risk in the most efficient and cost-effective manner. As part of its continuing mission and specific legislative authorization, SORM announces its intent to receive Proposals for broad-based Workers’ Compensation Health Care Network solution(s) for the Government Employees’ Workers’ Compensation Program.

3.Proposals are being solicited from one or more qualified Workers’ CompensationHealth Care Networks (Proposer) to provide network services now provided for in the Texas Workers’ Compensation Act, Title 5, Texas Labor Code, and Chapter 1305, Texas Insurance Code, with attendant administrative rules, and the provisions specified in this RFP, associated documents, and final Contract. Target initiation of services isduring Fiscal Year 2009, subject to Contract finalization, and available funding and approval by the SORM Board of Directors.

4.Regardless of date of initiation, the initial term of the Contract expires at the end of the Fiscal Year in which it is initiated. The initial term may or may not be a full Fiscal Year period. At the option of SORM, a resulting Contract may be renewed for five additional one year terms, subject to available funding by the Legislature and approval by the SORM Board of Directors, beginning with the first full Fiscal Year after the expiration of the initial term. SORM will require the successful Proposer to enter into a Contract with SORM, substantially in the format of the exemplar Contract included herein. If a Proposer is unable to accept any of the terms and conditions of the Contract, the Proposer shall include a statement to this effect in its Proposal. Failure to accept the terms and conditions of the Contract may, at SORM’s discretion, disqualify the Proposal.

5.A Proposer may submit a Proposal to serve one or multiple service areas subject to the requirement to serve full counties only. SORM may at its discretion select multiple Proposers for award of a Contractto provide network coverage to SORM workers’ compensation claimants, but shall not be required to award any Contract to any Proposer if SORM so determines. Subject to TDI requirements, SORM may limit the number of networks to only that number it deems adequate to provide comprehensive health care services sufficient to serve the population of injured employees within the service area.

6.Prospective Proposers are responsible for fully reviewing and responding to this RFP. All associated documents for the Workers’ Compensation Health Care Network RFP will be posted on the Electronic State Business Daily (ESBD) at website includes the complete RFP and instructions for interested Proposers for download, including instructions for submission, the Contract, and additional background information for each section of the RFP document.

7.In order to save taxpayer funds and agency resources, it is strongly encouraged that Proposers obtain the solicitation document and subsequent addenda published during the solicitation process directly from the Electronic State Business Daily (ESBD) website. Throughout the solicitation process, this website will display the latest and most up-to-date information about the posted solicitation.

B.Schedule of RFP Process. The RFP process and contract awards shall be conducted in accordance with the following anticipated schedule. Any anticipated modifications to the schedule below are indicatedand will be duly posted as required.

1.On or after December 07, 2007, the RFP will be available on the ESBD.

2.OnWednesday, January 16, 2008, SORM will conduct a Workers’ CompensationHealth Care Network Pre-Bid Conference at 9:00 a.m. in the WilliamP.ClementsBuilding, 300 W. 15th St., 1ST Floor, Rm. 103, Austin, Texas. Prospective Proposers are encouraged to have key representatives in attendance to participate in the Conference. Additional pre-proposal conferences may be announced as deemed necessary by SORM. For planning purposes , attendees are requested to contact Alma Torres by Tuesday, January 15, 2008.

On or before 12:00 Noon, C.S.T. on Friday, March 28, 2008,Proposers must provide one (1) original and one (1) identical hard copy of the completed Proposal, plus ten (10) complete electronic copies,as described herein, to the following address:

Regular Mail to:
State Office of Risk Management
c/o Office of the Attorney General
Attn: Alma Torres, CTPM, CPPB
P.O. Box 12039
Austin, Texas78711-2039 / Hand Delivery or Express Mail to:
Office of the Attorney General
300 W. 15th St., 3rd Floor, Rm 301B
Austin, Texas78701
Attn: Alma Torres,CTPM, CPPB

4.SORM anticipates its Board will make selections prior to the closure of Fiscal Year 2008 for implementation in Fiscal Year 2009, but makes no warranties respecting dates or occurrence of final action. Renewal periods identified herein may be modified based on date of award and execution of the final Contract. Proposers are advised to provide timely supplementation as required in Section II, pending Board selection.

5.Proposers may be interviewed via phone conference and/or through site visitsto discuss network, administrative, and customer service capabilities, as well as any other relevant factors in the evaluation process, prior to the selection of Proposals for recommendation at a public Board meeting.

Fiscal Year. As described in this RFP, the State of Texas Fiscal Year begins on September 1 and ends on August 31 of the following annual year.

Specificity. Proposers are advised to read this RFP carefully and completely. The nature and scope of this procurement, and its potential impact on injured state employees, the State Office of Risk Management, and the State of Texas, is important and necessitates careful attention to detail. Failure to answer specific questions or provide requested detail may result in disqualification of a Proposal or negative evaluation by the Selection Committee.

II. General Information.

A.Proposal.

1.Inquiries. Questions about SORM and the RFP may be submitted in writing by email, regular mail or facsimile. All written questions for the first pre-bid conference are due by January 07, 2008. Additional question period(s) may be announced as deemed necessary by SORM. Any questions submitted will be answered at the sole discretion of the SORM in a question and answer document issued by SORM. Only answers provided in writing by SORM shall be considered official. All questions should, to the degree possible, cite the specific RFP section and paragraph number(s) to which the question refers. Information in any form other than the materials constituting this solicitation, the Question & Answer Document and any RFP Document Addenda shall not be binding on SORM. SORM will post the question and response on the OAG’s vendor website. Any inquiries must be directed to:

State Office of Risk Management

Attention: Alma Torres

P.O. Box 12039

Austin, Texas78711-2039

Telephone: (512) 475-4524

Fax: (512) 397-1603

Email:

2.Submission. The Proposer shall submit its Proposal in the order prescribed in the Order of Return Instructions. SORM will not consider a Proposal unless it receives one (1) original plus one (1)identical hard copyof the full Proposal, including all required and completed attachments, and ten (10)copies on compact discin PDF format with tables and data attached thereto in Excel format, or in the case of graphical information, in a commonly accepted graphics format (.jpg, .gif, etc.). The proposals must be received in the OAG Purchasing Section by 12:00 noon, CST on March 28, 2008.

3.Supplements.

a.In the event that it becomes necessary to revise any part of the RFP, or if additional information is necessary to enable the Proposer to make an adequate interpretation of the provisions of this RFP, supplemental information will be provided to each Proposer that has indicated interest. However, SORM shall not be bound by any deviations from or to this RFP unless SORM specifically agrees thereto in writing.

b.Supplementation by Proposer pursuant to specific authorizations andrequests herein respecting network certification or other matters pending approval or review by third parties must be provided immediately for consideration. All supplementations should be clearly marked as a “Supplement” and specifically indicate both new information and any revisions to prior submissions. SORM shall announce closure of the supplementation period prior to final consideration and award.

4.Signature. A duly authorized officer of the responding Proposer mustsign the Proposal. Proposals not evincing authorized signatures willbe disqualified.

5.Agent of Record. SORM shall not designate an Agent of Record or any other such company employee or commissioned representative. Any requests for SORM to provide such designation shall be rejected. Proposers are specifically instructed to submit Proposals directly to OAG Purchasing as specified herein.

6.Costs. SORM shall not reimburse the Proposer for any costs incurred by the Proposer for the certification of Proposer’s network by the Texas Department of Insurance (TDI) or the Division of Workers’ Compensation (DWC), the Proposal preparation and negotiation process, or any required notifications to or filings with TDI or DWC.

7.Evaluation. SORM shall make any award(s), if any, based on a best interest of the State analysis, and shall not be required to approve or select a Proposal based solely on lowest cost. SORM shall take into account other relevant factors, including but not limited to: submission compliance, scope of available services, quality and accessibility of the provider network, the ability to service contracts, past experience, financial stability, and other relevant criteria. Approval criteria are described in theProposal Evaluation Criteriasection herein. SORM staff and the Board of Directors may determine, at its sole discretion, that other factors should be considered based on its review of a Proposer’s responses to the RFP.

Based upon SORM’s evaluation of Proposer responses to this RFP, SORM shall determine if there is a need to solicit a Best and Final Proposal. A request for a Best and Final Proposal shall be at the sole discretion of the SORM and shall be requested in writing from the OAG’s Central Purchasing Division. Any unsolicited Proposal requests for a Best and Final offer shall not be considered.

In accordance with Texas Government Code, §2155.074 and 2155.75, vendor performance may be used as a factor in the award.

8.Award. SORM reserves the right to reject any and all Proposals. Award of Purchase Order and execution of the Contract issued in accordance with this RFP is dependent upon formal approval of the Proposal and the final Contract by the SORM Board of Directors.

9.Approval and Execution. The final Contract, which may vary from the exemplar made part of the proposal packet as a result of final negotiation and acceptance, shall incorporate by its terms and by reference: this RFP; the Proposer’s Proposal; and any and all other information, duties or obligations the Proposer may be required to provide or perform. The Exemplar Contract must be reviewed by a duly authorized officer of the Proposer, approved as to form, and returned without amendment or revision with the appropriate exhibits attached with the response submission. In the event Proposer does not approve the form of the Exemplar Contract, Proposers must submit any and all proposed variances to the Exemplar Contract, with detailed support and rationale for the variances, as a separate attachment and note the same conspicuously in its response. SORM reserves the right to reject any Proposal if the Exemplar Contract is revised on its face or returned unapproved, except as specifically provided herein. Mere provision of Proposer’s contract as part of the Proposal shall not constitute compliance with this requirement.

10.Deviation. Proposers must provide a detailed description of each deviation between the Proposal and the RFP specifications. Deviations are discouraged and must be specifically identified and described in detail in order to be considered. SORM will attempt to interpret responses to match the specifications herein, with the exception of deviations specifically noted and those deviations deemed non-responsive. Deviations will not become a part of the final contract unless expressly agreed to by SORM in writing and accepted by the SORM Board of Directors. In all cases, the Contract terms, including any written addenda or operational agreements, and the specific RFP shall control.

11.Disclosure. SORM is required to provide access to certain records in accordance with the provisions of the Public Information Act, Chapter 552, Texas Government Code, formerly known as the Open Records Act. In order to protect and prevent inadvertent access to confidential information submitted in support of its Proposal, the Proposer is required to state which information it believes is exempt from disclosure and to provide legal authority in each instance. SORM shall have no liability to the Proposer or any other person or entity for disclosing information in accordance with the Public Information Act. SORM may request, at its discretion, a decision from the Office of the Attorney General (OAG) respecting disclosure, but shall not have the obligation or duty to advocate the confidentiality of Proposer’s material to the OAG or to any other person or entity. It is the Proposer’s sole obligation to advocate the confidential or proprietary nature of any information it provides in its Proposal, and the Proposer acknowledges that the OAG may determine that all or part of any claimed confidential or proprietary information should be disclosed. SORM may release the Proposer’s entire Proposal, including alleged confidential or proprietary information, upon request from a member of the Legislature where needed for legislative purposes, as provided for in the Public Information Act. This section survives termination of the Contract.

B.Provisions.

1.Authority. Section 1305.005(c), Texas Insurance Code,specifies that SORM retains exclusive authority to establish or contract with networks certified pursuant to Chapter 1305, Texas Insurance Code, on behalf of its client agencies. Chapter 2155 of the Texas Government Code requires that any selection(s) shall be in the best interest of state employees covered under the Government Employees Workers’ Compensation Program.

2.News Releases. Written approval by SORM will be required for any news releases or other similar communications regarding selection of a Proposer to provide network services for SORM.

3.Prohibited Interest. Except as an injured worker in the Government Employees’ Workers’ Compensation Insurance Program, a member, Board member, or employee of SORM may not have a direct interest in the gains or profits from any Contract executed by SORM pursuant to this RFP and may not receive any payment or emolument for any service performed for the Proposer or its network.

In the case where a Board member or employee of SORM receives any payment from the Proposer for any services performed for the Proposer or for any gains or profits from any Contract executed by SORM pursuant to this RFP, SORM may terminate its relationship with the Proposer. SORM reserves the right to seek any legal, equitable or contractual relief to which it may be entitled. Under such circumstances, the Proposer must complete any outstanding SORM transactions as soon as practicable. SORM will not consider responses from the Proposer for two full years thereafter.