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Procurement Opportunities

Current Procurement Opportunities

RFP C000399 Actuarial Consultant – Medical Malpractice

Questions and Answers

  1. Question: RFP page 20, section 7.3, Proposal Cost Summary, mentions that rate/hours should be shown for consultants. Please clarify if you mean subcontractors when you use the term "consultants." Also, in filling out the expected total hours, should we base this amount on the 3,000 hours/5 years (600 hours/year) set forth in item 7.1.a of the RFP? If not, what measure of expected number of hours do you envision being used?
    • Answer: The term "consultants" refers to the awarded entity. A commitment of approximately 3,000 hours over the duration of the contract is expected.
  2. Question: Will an annual increase in cost/hourly rates be allowed since this is a five-year contract?
    • Answer: Any annual increases (specifically stated in the contract, in accordance with the Consumer Price Index, etc.) must be quantified in your cost proposal, have a cap and cannot be open-ended.
  3. Question: Please clarify RFP page 6, section 2.2.d, re: references for our staff. Do these references need to be different than the five references for the firm or can they be the same? Are the three personal references only required for the senior staff we name for the project?
    • Answer: No, the referenced do not need to be different. Yes, the three references are only for the senior staff named for the project.
  4. Question: Please clarify the MWBE requirements for this proposal. Our firm has the resources in-house to complete the required work thus we will not engage any subcontractors. Does that mean we will fall short of the 20% target and thus not be considered? Given that we will not subcontract any work, which of the Appendix D forms should we include with our proposal?
    • Answer: As subcontractors will not be engaged, the 20% MWBE target does not apply.
  5. Question: RFP page 19, section 7.2, provides the 70%/30% breakdown of the award evaluation. If we do not have a NY office, what is the likelihood we would not reach the minimum score to be evaluated further?
    • Answer: Office location is not a factor in the evaluation.
  6. Question: Will the requested reserving services be performed in conjunction with financial or target examinations performed by the Department, or in some other capacity?
    • Answer: Both, the reserving services will be performed based on "Risk-Focused" approach as well as other projects.
  7. Question: What are the expected number of rate analyses and expected number of reserve analyses that will be performed by the winning bidder per year? What is the format of deliverable required in each case, e.g., aggregate report vs. stand-alone reports?
    • Answer: Approximately 6 rate analyses and/or reviews and one reserve analysis and/or review per year. Some reports are stand-alone reports while others are on aggregate basis.
  8. Question: Are rate hearings expected to be a part of the process?
    • Answer: No
  9. Question: Will the services falling under item 2-A.2 on page 5 of the RFP be in the form of a review of rate filings presented by the companies, or independent ground-up rate analyses performed by the winning bidder?
    • Answer: Both
  10. Question: What are the expectations for on-site or Department visits to complete the required work? Should the Cost Proposal estimate for such expenses be presented on a per-visit basis, or an annual basis?
    • Answer: On-site and Department visits are both expected. Cost Proposal should be presented on an annual basis.
  11. Question: Who is the incumbent actuarial firm?
    • Answer: Pinnacle Actuarial Resources. Please note, information about all active contracts with New York State Agencies is available on the NYS Comptroller's website at http://wwe2.osc.state.ny.us/transparency/contracts/contractsearch.cfm
  12. Question: How many years has the incumbent provided the requested services?
    • Answer: The current contract is for five years.
  13. Question: Why is the Department bidding for these services? (e.g. Required by law? Unhappy with existing provider?, etc.)
    • Answer: To augment the Department's in-house actuarial staff as the current 5-year contract is expiring.
  14. Question: Is it possible to get a copy of the prior proposal submitted by the incumbent (if any)?
  15. Question: Is it possible to get a copy of the previous report(s} and other work performed by the incumbent?
    • Answer: Please see the answer for Question #14.
  16. Question: What is project budget cost or hourly rate(s) for the incumbent's current contract?
    • Answer: The current contract is five years at a not to exceed contract cap of $1,344,650.
  17. Question: Why are these services out to bid? Are they due to the expiration of the current contract or for other reasons?
    • Answer: To augment the Department's in-house actuarial staff as the current contract is expiring.
  18. Question: Who is the Department's current actuarial consultant?
    • Answer: Pinnacle Actuarial Resources.
  19. Question: How long has the current actuarial consultant been servicing the Department?
    • Answer: Since August 2009
  20. Question: What are the total fees that have been paid to the current or previous consultant in the past two contract years?
  21. Question: If applicable, please provide the rate per hour for each personnel tier for the last two contract years.
  22. Question: We note that Appendix D, Business Participation Opportunities for MWBEs, states the overall goal of 20% for MWBE participation in compliance with the New York State Executive Law Article 15-A. However, upon reviewing of the proposal scoring criteria, we don't see a percentage assigned to meaningful MWBE participation. Can you provide us some insight on the importance of MWBE participation in the evaluation and selection process?
    • Answer: MWBE participation is not included as part of the scoring criteria.
  23. Question: Is there any MWBE company(ies) currently working on the existing contract(s)? If yes, please provide the name(s) of the company(ies) and the types of services provided.
    • Answer: No
  24. Question: Would our proposal be disadvantaged in the scoring process if we assign the 20% overall MWBE participation goal to one MBE versus splitting the percentage between two separate MBE and WBE companies?
    • Answer: See answer to #22 above.
  25. Question: Who is the current actuarial Contractor?
    • Answer: Pinnacle Actuarial Resources
  26. Question: How long has the Contractor been engaged?
    • Answer: The current contract is for five years.
  27. Question: Can you please provide winning proposal of last contract?
  28. Question: Please provide names of firms submitting questions for this RFP.
  29. Question: How different is the scope of work contained in this RFP different from the expiring one?
    • Answer: The scope of services is very similar to the previous contract. This RFP is very similar to the previous contact. Reserving services will be performed as part of "Risk-Focused" financial and/or target examinations performed by the Dept.
  30. Question: If so can you provide an estimate of additional hours required. Varies depends on individual company resources.
    • Answer: Varies depends on individual company resources.
  31. Question: General Question: Can you please share all copies of reports or work products of the expiring contract excluding confidential information?
  32. Question: Briefly describe the sort of loss, exposure and other relevant information available for the actuarial reviews. Is data processing and testing required?
    • Answer: Company provided data may include paid losses & expenses, incurred losses & expenses and claim counts etc. in spreadsheet format. Yes, to the extent that data reconciliation that is required to be included in the Actuarial Report underlying a Statement of Actuarial Opinion.
  33. Question: Who are the claim administrators of the listed companies?
    • Answer: This information is not available.
  34. Question: At what level of segmentation will the actuarial reserve analyses be required? Will the Contractor be required to come up with unpaid claim estimates for each listed company and its locations?
    • Answer: Fair amount of segmentation is required based on the company and the business written. The contractor will be required to come up with unpaid claim estimates for each listed company in aggregate but not by locations.
  35. Question: Please advise if the premium rates will include premium rates by specialty/practice area such as Surgeons and OB\GYN and locations such as Long Island and Manhattan counties.
    • Answer: Yes
  36. Question: Will the Contractor be required to come up with a rating plan in addition to estimated premium rates for each entity and location?
    • Answer: Unlikely that the Contractor will be required to come up with a rating plan.
  37. Question: Are the coverage policies occurrence or claims-made? If the underlying policies are written on claims-made basis, will the Contractor be required to estimate step factors and tail rates?
    • Answer: Both. Contractor is required to do all that is necessary to perform the rate and reserve analyses.
  38. Question: Is the list of insurance companies shown on the RFP exhaustive?
    • Answer: Yes.
  39. Question: What are the frequencies of actuarial reserve reviews and premium rate estimations required in a year? Approximately 6 rate analyses and/or reviews and one reserve analysis and/or review per year.
    • Answer: Approximately 6 rate analyses and/or reviews and one reserve analysis and/or review per year.
  40. Question: Will the contracted actuary be required to consider the proposed change in statute of limitation of claims in premium rate calculation? Is this is an example of "Other Actuarial Issues" referenced in section 2-A.5?
    • Answer: Whether or not it was asked in the past, The Contractor should be available for consultation on this and other related actuarial issues.
  41. Question: Section 2-A.4 comments on providing inputs to Property Bureau. Can you please provide further details or examples of such inputs?
    • Answer: Peer reviews of rate and reserve analyses performed by the Department's in-house actuarial staff.
  42. Question: Section 2-A.5. Please provide examples of "Other Actuarial Issues"?
    • Answer: Impact of changes in legislation or cap awards.
  43. Question: Can any of the three references of Contractor's staff be co-workers working in the same company?
    • Answer: No
  44. Question: What are the key deadlines for each actuarial report?
    • Answer: There is a requirement that examinations be completed in 18-months. Specific deadline will be stated in work-plan. The specific time-frames will be developed within the work-plan in coordination with the Department.
  45. Question: At what time periods are all relevant information needed for each set of actuarial review normally made available?
    • Answer: Depends on the assignment.
  46. Question: How many hearings were held in the past two years in regards to the Contractor actuary's works and how long do such hearings last?
    • Answer: None.
  47. Question: When is the estimated start date of the agreement?
    • Answer: August 2014.
  48. Question: When did the expiring agreement start?
    • Answer: August 2009.
  49. Question: Will the cost of the project be adjusted for any significant change in scope mandated by the client?
    • Answer: No, any scope changes to the contract would have to be negotiated as an amendment to the contract.
  50. Question: What is the allocated time for each oral presentation slot?
    • Answer: The oral presentation is at the discretion of the Department and the length shall be determined at a later date if it is determined that they are necessary.
  51. Question: Can you also give examples of items that should be discussed during the presentation by the Bidder?
    • Answers: Bidders' familiarity of NAIC rules, international standards, experience of other state medical malpractice market.
  52. Question: Section 5.5: What are the key items to be discussed between a successful Bidder and the Department? Do these items include contractor's fees and start date?
    • Answer: The Department and successful bidder will commence contract negotiations after the award and discussions will include start date. The contractor's fees will be based on the proposal submitted and cannot increase during the contract negotiations.
  53. Question: What is the range of budgeted fees for this project?
    • Answer: The budget for this project will be based on the cost proposal from the bidder deemed to be the Total Best Value.
  54. Question: Can you please share the range of submitted fees and hours in the last three contract bids?
  55. Question: Should hours and fees be on annual basis or over the five year contract term?
    • Answer: Fees should be submitted as a total cost for a five year term, they can be broken down annually if desired.
  56. Question: What are the total fees charged for the last three contractual periods?
  57. Question: Can Bidder submit a range of hours for each level of actuary and hourly rate for each level of actuary? Hence the input item at Column (5) of the Budget Form 1(Section 7.3) will be a range instead of point estimate.
    • Answer: If your bid consists of a range the highest end of any range will be used to calculate your overall proposed price when comparing your prices to the other bidders which will factor into the overall evaluation score. This contract will have a firm, not to exceed contract cap based on the bidder's cost proposal.
  58. Question: What time period (say 2 months) will you consider a reasonable timeframe to complete each actuarial analysis?
    • Answer: Depends on the assignment
  59. Question: Are the stipulated 3,000 hours the total amount of time required to complete the contract on annual basis?
    • Answer: A commitment of approximately 3,000 hours over the duration of the contract is expected.
  60. Question: Please briefly explain how points for both the Technical and Cost Evaluations will quantitatively be awarded to each qualified item
    • Answer: The only information about points that we will make available is that 70% is assigned to the technical portion and 30% to the cost portion.
  61. Question: Will similar required services offered to non-governmental organization of similar size as the Department be given equal consideration?
    • Answer: Yes.
  62. Question: Regarding Section 2, paragraph 2-A.1 and 2-A.2-Please expand on/clarify the scope of work.
    • Answer: No further information is available at this time.
  63. Question: Regarding Section 2, paragraph 2-A.2-What are the specific requirements for rate section of the RFP?
    • Answer: Peer review rate filings and perform rate analyses.
  64. Question: Who is currently performing this work?
    • Answer: Pinnacle Actuarial Resources
  65. Question: What is the current contract cost, including hours billed?
  66. Question: Is the current service provider being considered?
    • Answer: All bids submitted will be considered.
  67. Question: Regarding Section 2, paragraph 2-A.1-What are the specific statutory deadlines with respect to the reserve portion of this exam?
    • Answer: There is a requirement that examination be completed in 18 months. More specific deadline would be decided upon when crafting the workplan specific to each reserve analysis.
  68. Question: Is this RFP being generated due to mandatory bid requirements or some other reason? Please elaborate.
    • Answer: To augment the Department's in-house actuarial staff as the current 5-year contract is expiring.
  69. Question: We understand that the NYS DFS will award this RFP to one bidder (RFP, page 1). Based on publicly available information regarding auditors and actuarial service providers, many actuarial service providers will have conflicts of interest. Will the NYS DFS consider multiple actuarial service providers where a bidder may have a conflict?
    • Answer: DFS will award to one bidder who does not have a conflict of interest.
  70. Question: Who is the incumbent actuarial service provider? How long has the incumbent been providing actuarial services to NYS DFS?
    • Answer: Pinnacle Actuarial Resources has held this contract since August 2009.
  71. Question: Will the incumbent be submitting a proposal in response to this RFP?
    • Answer: We do not know who will be submitting a proposal until they are received. The incumbent is not precluded from bidding.
  72. Question: To help us better understand the scope and magnitude of the actuarial services, please provide the fees and hours for actuarial services for the two latest annual periods? Please provide a breakdown of deliverable/service, if available, including any projects outside the scope of this RFP.
  73. Question: Has the incumbent provided actuarial services outside the scope of this RFP that the NYS DFS would want a new contractor to provide? Will these additional services, as well as any input related to work performed by actuarial staff of the Property Bureau and other related actuarial issues, be billed "in addition" based on time and materials? (RFP section 2-A.4 and 2-A.5)
    • Answer: No, any scope changes to the contract would have to be negotiated as an amendment to the contract.
  74. Question: Please clarify whether the role of the actuarial service provider would be to review rates filed by the subject medical malpractice insurance companies versus making rate recommendations as discussed in the RFP. Please discuss the actuarial service provider's role in recommending rates. (RFP section 2-A.2)
    • Answer: Both. Perform rate analyses and provide rate recommendations.
  75. Question: Please clarify for what medical professional liability sub-lines, e.g. physician professional liability, hospital professional liability, etc., the actuarial service provider will review rates. (RFP section 2-A.2)
    • Answer: Medical professional liability insurance to physicians, dentists, and other allied professionals across a broad spectrum of specialties.
  76. Question: Can you provide a copy of one or more of the latest reserve and rate reviews? Please also include a copy of any additional analyses related to investment income returns; provisions for reinsurance; ULAE; UPR; surplus? (RFP section 2-A.1 and 2-A.2)
  77. Question: How many companies are anticipated for review each year? (RFP section 1.2) Will a reserve and rate review be required annually? What is the format of deliverable required in each case, e.g., aggregate report vs. stand-alone reports?
    • Answer: Approximately 6 rate analyses and/or reviews and one reserve analysis and/or review per year on average. Some reports are stand-alone reports while others are on aggregate basis.
  78. Question: Please clarify the level of detail of review of "Other related items" (RFP, section 1.2; e.g., investment income returns; provisions for reinsurance; ULAE; UPR; surplus).
    • Answer: ULAE and UEP are considered as part of reserve and/or rate analysis. Other related items may include analysis of investment income returns, industry studies, peer reviews of rate and reserve analyses performed by the Department's in-house actuarial staff etc.
  79. Question: What will be the sources of data and information? Is data processing and testing required? Please describe the data available. (RFP section 2-A.1 and 2-A.2)
    • Answer: Company provided data may include paid losses & expenses, incurred losses & expenses, trend information, and claim counts etc. Yes, to the extent that data reconciliation that is required to be included in the Actuarial Report underlying a Statement of Actuarial Opinion.
  80. Question: What are the current actuarial methodologies used and is the intent to change these in any way going forward? (RFP section 2-A.1 and 2-A.2)
    • Answer: Currently traditional actuarial methodologies are used. However, the contractor is required to do all that is necessary to perform the rate and reserve analyses. Furthermore, contractors have and should continue to perform non-traditional methods as needed in order to perform the most appropriate rate and reserve analyses.
  81. Question: Can you clarify your timing expectations as far as provision of data and deliverables (RFP section 7.2)? Please include both the anticipated time of year and the span time from receipt of data and information to completion of deliverables.
    • Answer: Rate reviews and analyses are in April and May. The deliverables for others are spread throughout the year. The specific time-frames will be developed within the work-plan in coordination with the Department.
  82. Question: Would the timing of the reserve reviews align with any rate reviews to leverage the same underlying data? (RFP section 2-A.1 and 2-A.2)
    • Answer: Yes, sometimes.
  83. Question: We understand that NYS does not indemnify contractors. Does the current contract with the incumbent actuarial consultant firm include a Limitation of Liability? If so, what is the liability limit? Would the State consider changes to its standard indemnity language, e.g., indemnification to contractor, limitation of liability, etc.? (RFP preamble page 2)
    • Answer: Our standard contract does not contain a limitation of liability. A bid should be submitted based on the understanding that there would be no limitation on liability or indemnification to contractor.
  84. Question: Has the State had any lawsuits from third parties regarding medical malpractice rates? Would the contractor be eligible for any State protections against third-party lawsuits under this contract? (RFP section 2-A.2, App B, App E)
    • Answer: There will be no assistance from the State in the event of a third-party lawsuit.
  85. Question: Can you provide a copy of the contract signed with the incumbent actuarial service provider? (App E)
  86. Question: Has the scope of the work changed from last time?
    • Answer: No
  87. Question: Who provided the requested services during the past five years?
    • Answer: Pinnacle Actuarial Resources
  88. Question: Would you be willing to share a copy of the past winning proposal? If so, could you please provide it to us?
  89. Question: We tend to have an exhaustive data request when performing rate filing reviews. What types of manuals and guidelines have you typically asked your service providers to review in the past?
    • Answer: We have not asked in the past but it does not preclude the contractor from asking for manuals and guidelines.
  90. Question: Please provide a copy of the most recent actuarial reserving reports and rate recommendations from the prior vendor.
  91. Question: Is it necessary to provide the biographies and/or resumes in any specific format?
    • Answer: No, they should be included in your proposal.
  92. Question: We provide a wide range of consulting and audit services to numerous healthcare insurance providers. Once learning the full list of the entities we may be reviewing for the Department, how long would we have to identify if a conflict of interest exists and resolve?
    • Answer: Please review the complete list of insurance companies on the Department's website. The conflict of interest provision applies to ALL licensees, not only the ones you'll be reviewing rates for. If there is any actual or perceived conflict you should identify and submit your proposed guidelines to deal with the conflict with your bid (Section 4.13 (b)).
  93. Question: Also related to conflicts of interest, does the language contained in Section 4.13 (b) mean for us to stop other work on the client or risk forfeiture of the contract?
    • Answer: If there is a conflict and it is not possible for the Department to approve proposed guidelines to dealing with the conflict then you would need to stop the other work or risk forfeiture.
  94. Question: We understand that the New York State Department of Financial Services seeks the services of an actuarial consultant to analyze/review the loss & loss and loss adjustment expense reserves (and other related items) and the premium rates of medical malpractice insurers operating in New York (either individually or for the industry as a whole), to review analyses performed by Department staff actuaries, and to consult with Department personnel on various actuarial issues. Is our understanding correct?
    • Answer: Yes.
  95. Question: Section 2, Paragraph 2-A.1 sets forth the Contractor's responsibilities as respects the reserve analyses. It is stated that the reserve analyses are to be performed using the Risk-Focused Examination approach as prescribed in the Financial Condition Examiner's Handbook. Such Risk-Focused Examinations involve more than the review of an insurer's carried reserves. Does the Department expect the Contractor to be involved in those other aspects of a Risk-Focused Examination, or is the Department only looking for the Contractor to review the reserves carried by the subject insurer? Approximately, how many reserve analyses does the Department anticipate the Contractor would be asked to perform during each of the contract years?
    • Answer: DFS expects the contractor to be involved in all applicable phases of a risk focused exam, such as development of a risk matrix, participation in data reconciliation and C-level interviews, substantive testing, etc. On average, one reserve analysis and/or review per year is performed.
  96. Question: Section 2, Paragraph 2-A.2 sets forth the Contractor's responsibilities as respects the premium rate reviews. Approximately, how many rate filings does the Department anticipate the Contractor would be asked to review during each of the contract years? Approximately, for how many rate filings would a rate hearing be called?
    • Answer: Approximately 6 rate analyses and/or reviews and one reserve analysis and/or review per year on average. There should be no rate hearings.
  97. Question: Section 2, Paragraph 2.2(e) states that Bidders must identify any conflicts. Section 7, Paragraph 7.1(a) states that the selected Bidder must not have any conflicts. To clarify, does this mean that if a Bidder has a conflict with one of the insurers listed in Section 1, Paragraph 1.2, that this one conflict would disqualify the Bidder?
    • Answer: If it is not possible for Department to approve your proposed guidelines for handling the conflict then you would be disqualified.
  98. Question: Would the Department please clarify how Bidders that are consultants are to complete Budget Form 1 as set forth in Paragraph 7.3. It is stated that an hourly rate and number of hours are to be presented for each member of the Bidder's proposed project team. But as the number of projects and scope of each project are not defined, how should a Bidder determine the number of hours to show on Form 1? For the purpose of completing Budget Form 1, does the Department want the Bidder to assume a total Project Budget of 3,000 hours over the term of the contract as indicated in Section 7, Paragraph 7.1(a)?
    • Answer: A commitment of approximately 3,000 hours over the duration of the contract is expected. The Bidder will need to estimate the number of hours needed to perform, on average, 6 rate reviews and/or analyses and 1 reserve review and/or analysis annually.
  99. Question: Section 2, Paragraph 2.2(b) states that the Bidder must submit at least five (5) references. Paragraph 2.2(d) states that the Bidder should include at least three (3) references. Please clarify the number of references Bidders are to submit.
    • Answer: The references in 2.2(b) refer to references for your firm. The ones in 2.2(d) refer to "…senior staff that would be available for this engagement,"
  100. Question: Section 4, Paragraph 4.2(c) states that Appendix D (MWBE Requirements and Forms) must be completed and submitted with the bid. It appears that Form #3 is to be completed by the Contractor during the life of the contract and, so, is not a form to be submitted with the proposal. Is our understanding correct? Also, we assume that if a Bidder is requesting a waiver that forms #4 and #6 do not need to be submitted. Is our understanding correct?
    • Answer: The use of subcontractors requires the Department's prior approval. The MWBE requirements are only applicable if subcontractors are utilized in performance of the contract. MWBE Form #3 is to be submitted on a quarterly basis during the contract term. MWBE Forms #4 and 6 do not need to be submitted if the vendor is requesting a waiver.
  101. Question: Section 4, Paragraph 4.2(c) also states that Appendix I (Consultant Disclosure Information and Forms) must be completed and submitted with the bid. Appendix I includes two forms. As respects Form A, as the number of projects and scope of each project are not defined, how should a Bidder determine the number of hours to be worked; does the Department want the Bidder to assume a total Project Budget of 3,000 hours over the term of the contract? Also, Form A requires cost information, yet is part of the Technical Proposal; does the Department want the "Amount Payable Under the Contract" to be provided? Form B appears to be for the Contractor to report the number of actual hours worked and, so, is not a form to be submitted with the proposal; is our understanding correct?
    • Answer: Form A is an estimate of consultant services over the life of the contract. The grand total should equal the total consultant services (excluding any non-personal service costs) bid for the five year contract period. Form B is required annually after the end of each state fiscal year (March 31st) where work was performed during that fiscal year detailing the actual consultant service costs for that period.
  102. Question: What firm is currently serving as the actuarial service provider (for the same scope of services described in the RFP) to the Department?
    • Answer: Pinnacle Actuarial Resources
  103. Question: What hourly rates are being paid to the current actuarial service provider?
  104. Question: Would a proposal that excludes reviewing certain companies be acceptable? Or is there a way to separate the rate recommendations services from the reserve analyses?
    • Answer: A proposal that excludes reviewing certain companies is not acceptable. No, there is no way to separate rate recommendations services from the reserve analyses.

Updated 03/13/2014

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