i

REQUEST FOR PROPOSALS FOR

WORKERS’ COMPENSATION

AUDIT SERVICES

ISSUING OFFICE

STATE WORKERS’ INSURANCE FUND

RFP NUMBER SWIF 2012-1

DATE OF ISSUANCE

May 16, 2012

ii

REQUEST FOR PROPOSALS FOR

WORKERS’ COMPENSATION AUDIT SERVICES RFP #SWIF 2012-1

TABLE OF CONTENTS

CALENDAR OF EVENTS iii

Part I—GENERAL INFORMATION 1.

Part II—PROPOSAL REQUIREMENTS 11.

Part III—CRITERIA FOR SELECTION 19.

Part IV—WORK STATEMENT 23.

APPENDIX A, STANDARD CONTRACT TERMS AND CONDITIONS

APPENDIX B, DOMESTIC WORKFORCE UTILIZATION CERTIFICATION

APPENDIX C, TERRITORY ASSIGNMENTS BY COUNTY

APPENDIX D, POLICY BREAKDOWN BY TERRITORY, BASED UPON

ESTIMATED PREMIUM

APPENDIX E, COST PROPOSAL FORMS

E-1 Territory A

E-2 Territory B

E-3 Territory C

E-4 Territory D Out-of –State

E-5 Territory E Statewide

APPENDIX F, CONTRACT QUALITY COMPARISON

F-1 Audit Quality Review Standards

APPENDIX G, WORKERS’ COMPENSATION AND EMPLOYERS’ LIABILITY

INSURANCE POLICY

APPENDIX H, AUDITORS PER GEOGRAPHIC TERRITORY

APPENDIX I, PROPOSAL COVER SHEET

APPENDIX J, RIGHT TO KNOW (RTKL)

iii

CALENDAR OF EVENTS

The Commonwealth will make every effort to adhere to the following schedule:

Activity Responsibility Date

Deadline to submit Questions via email to emarrazzo@pa.gov Potential

Offerors

May 25,

2012

Pre-proposal Conference – 100 Lackawanna Ave, Conference

Room B-3, Scranton, Pa. 18505

Issuing

Office/Potential

Offerors

May 29,

2012

10:30a.m.

Answers to Potential Offeror questions posted to the DGS

website (http://www.dgsweb.state.pa.us/RTA/Search.aspx) no

later than this date.

Issuing Office June 5, 2012

Please monitor website for all communications regarding the

RFP.

Potential

Offerors ongoing

Sealed proposal must be received by the Issuing Office at 100

Lackawanna Avenue, 4th

Floor, Scranton, Pa. 18505 Offerors

June 18,

2012 - 1:00

p.m.

PART I

GENERAL INFORMATION

I. 1. Purpose. This request for proposals (RFP) provides to those interested in submitting

proposals for the subject procurement (“Offerors”) sufficient information to enable them to

prepare and submit proposals for the Department of Labor & Industry, State Workers’ Insurance

Fund’s (SWIF) consideration on behalf of the Commonwealth of Pennsylvania

(“Commonwealth”) to satisfy a need for Workers’ Compensation Audit Services.

I. 2. Issuing Office. The Department of Labor & Industry, SWIF (“Issuing Office”) has

issued this RFP on behalf of the Commonwealth. The sole point of contact in the

Commonwealth for this RFP shall be Eileen J. Gydosh Marrazzo, State Workers’ Insurance

Fund, Commonwealth of Pennsylvania, Department of Labor and Industry, 100 Lackawanna

Avenue, 4th

Floor, P.O. Box 5100, Scranton , Pa. 18505-5100; emarrazzo@pa.gov, the Issuing

Officer for this RFP. Please refer all inquiries to the Issuing Officer.

I. 3. Scope. This RFP contains instructions governing the requested proposals, including the

requirements for the information and material to be included; a description of the service to be

provided; requirements which Offerors must meet to be eligible for consideration; general

evaluation criteria; and other requirements specific to this RFP.

I. 4. Problem Statement. In its commitment to fully accomplish its goals and fulfill its

responsibilities to its insured’s, SWIF seeks to procure expert worker’s compensation audit

services as required for both in state and out-of-state policies. Additional detail is provided in

Part IV of this RFP.

I. 5. Type of Contract. It is proposed that if the Issuing Office enters into a contract as a

result of this RFP, it will be a firm MULTIPLE AWARD CONTRACT containing the Standard

Contract Terms and Conditions as shown in Appendix A and available at

http://www.dgs.state.us/dgs/forms/comod/procurementforms/std274sap.doc.

I. 6. The Issuing Office, in its sole discretion, may undertake negotiations with Offerors

whose proposals, in the judgment of the Issuing Office, show them to be qualified, responsible

and capable of performing the Project.

I. 7. Rejection of Proposals. The Issuing Office reserves the right, in its sole and complete

discretion, to reject any proposal received as a result of this RFP.

I. 8. Incurring Costs. The Issuing Office is not liable for any costs the Offeror incurs in

preparation and submission of its proposal, in participating in the RFP process or in anticipation

of award of the contract.

I. 9. Pre-proposal Conference. The Issuing Office will hold a pre-proposal conference as

specified in the Calendar of Events. The purpose of this conference is to provide opportunity for

clarification of the RFP. Offerors should forward all questions to the Issuing Office in

2

accordance with Part I, Section I-10 to ensure adequate time for analysis before the Issuing

Office provides an answer. In view of the limited facilities available for the conference,

Offerors should limit their representation to two (2) individuals per Offeror. The pre-proposal

conference is for information only. Any answers furnished during the conference will not be

official until they have been verified in writing by the Issuing Office. All questions and written

answers will be posted on the Department of General Services’ (“DGS”) website

(www.emarketplace.state.pa.us) as an addendum to, and shall become part of, this RFP.

Attendance at the pre-proposal conference is optional.

I. 10. Questions & Answers. If an Offeror has any questions regarding this RFP, the Offeror

must submit the questions by email (with the subject line “RFP #SWIF 2012-1 Question”) to the

Issuing Officer named in Part I, Section I-2 of the RFP. If the Offeror has questions, they must

be submitted via email no later than the date indicated on the Calendar of Events. The Offeror

shall not attempt to contact the Issuing Officer by any other means. The Issuing Officer shall

post the answers to the questions on the DGS website by the date stated on the Calendar of

Events. An Offeror who submits a question after the deadline date for receipt of questions

indicated on the Calendar of Events assumes the risk that its proposal will not be responsive or

competitive because the Commonwealth is not able to respond before the proposal receipt date or

in sufficient time for the Offeror to prepare a responsive or competitive proposal. When

submitted after the deadline date for receipt of questions indicated on the Calendar of Events, the

Issuing Officer may respond to questions of an administrative nature by directing the questioning

Offeror to specific provisions in the RFP. To the extent that the Issuing Office decides to

respond to a non-administrative question after the deadline date for receipt of questions indicated

on the Calendar of Events, the answer must be provided to all Offerors through an addendum.

All questions and responses as posted on the Department of General Services (DGS) website are

considered as an addendum to, and part of, this RFP in accordance with RFP Part I, Section I-10.

Each Offeror shall be responsible to monitor the DGS website for new or revised RFP

information. The Issuing Office shall not be bound by any verbal information nor shall it be

bound by any written information that is not either contained within the RFP or formally issued

as an addendum by the Issuing Office. The Issuing Office does not consider questions to be a

protest of the specifications or of the solicitation. The required protest process for

Commonwealth procurements is described on the DGS website.

I. 11. Addenda to the RFP. If the Issuing Office deems it necessary to revise any part of this

RFP before the proposal response date, the Issuing Office will post an addendum to the DGS

website at http://www.dgsweb.state.pa.us/RTA/Search.aspx. It is the Offeror’s responsibility to

periodically check the website for any new information or addenda to the RFP. Answers to the

questions asked during the Questions & Answers period also will be posted to the website as an

addendum to the RFP.

I. 12. Response Date. To be considered for selection, hard copies of proposals must arrive at

the Issuing Office on or before the time and date specified in the RFP Calendar of Events. The

Issuing Office will not accept proposals via email or facsimile transmission. Offerors who send

proposals by mail or other delivery service should allow sufficient delivery time to ensure timely

receipt of their proposals. If, due to inclement weather, natural disaster, or any other cause, the

3

Commonwealth office location to which proposals are to be returned is closed on the proposal

response date, the deadline for submission will be automatically extended until the next

Commonwealth business day on which the office is open, unless the Issuing Office otherwise

notifies Offerors. The hour for submission of proposals shall remain the same. The Issuing

Office will reject, unopened, any late proposals.

I. 13. Proposals. To be considered, Offerors should submit a complete response to this RFP to

the Issuing Office, using the format provided in Part II, providing ten (10) paper copies of the

Technical Submittal and one (1) paper copy of the Cost Submittal and two (2) paper copies of

the Disadvantaged Business Submittal. In addition to the paper copies of the proposal, Offerors

shall submit two complete and exact copies of the entire proposal (Technical, Cost and

Disadvantaged Business Submittals, along with all requested documents) on CD-ROM or Flash

drive in Microsoft Office or Microsoft Office-compatible format. The electronic copy must be a

mirror image of the paper copy and any spreadsheets must be in Microsoft Excel. The Offerors

may not lock or protect any cells or tabs. Offerors should ensure that there is no costing

information in the technical submittal. Offerors should not reiterate technical information in the

cost submittal. The CD or Flash drive should clearly identify the Offeror and include the name

and version number of the virus scanning software that was used to scan the CD or Flash drive

before it was submitted. The Offeror shall make no other distribution of its proposal to any other

Offeror or Commonwealth official or Commonwealth consultant. Each proposal page should be

numbered for ease of reference. An official authorized to bind the Offeror to its provisions must

sign the proposal. If the official signs the Proposal Cover Sheet (Appendix I to this RFP) and the

Proposal Cover Sheet is attached to the Offeror’s proposal, the requirement will be met. For this

RFP, the proposal must remain valid for 120 days taking into consideration time required for

evaluation of proposals and processing of the contract days or until a contract is fully executed.

If the Issuing Office selects the Offeror’s proposal for award, the contents of the selected

Offeror’s proposal will become, except to the extent the contents are changed through Best and

Final Offers or negotiations, contractual obligations.

Each Offeror submitting a proposal specifically waives any right to withdraw or modify it,

except that the Offeror may withdraw its proposal by written notice received at the Issuing

Office’s address for proposal delivery prior to the exact hour and date specified for proposal

receipt. An Offeror or its authorized representative may withdraw its proposal in person prior to

the exact hour and date set for proposal receipt, provided the withdrawing person provides

appropriate identification and signs a receipt for the proposal. An Offeror may modify its

submitted proposal prior to the exact hour and date set for proposal receipt only by submitting a

new sealed proposal or sealed modification which complies with the RFP requirements.

I. 14. Disadvantaged Business Information. The Issuing Office encourages participation by

small disadvantaged businesses as prime contractors, joint ventures and subcontractors/suppliers

and by socially disadvantaged businesses as prime contractors.

Small Disadvantaged Businesses are small businesses that are owned or controlled by a majority

of persons, not limited to members of minority groups, who have been deprived of the

opportunity to develop and maintain a competitive position in the economy because of social

disadvantages. The term includes:

4

1. Department of General Services Bureau of Minority and Women Business

Opportunities (BMWBO)-certified minority business enterprises (MBEs) and women

business enterprises (WBEs) that qualify as small businesses; and,

2. United States Small Business Administration certified 8(a) small disadvantaged

business concerns.

Small businesses are businesses in the United States which are independently owned, are not

dominant in their field of operation, employ no more than 100 full-time or full-time equivalent

employees, and earn less than $20 million in gross annual revenues ($25 million in gross annual

revenues for those businesses in the information technology sales or service business).

Socially disadvantaged businesses are businesses in the United States that BMWBO determines

are owned or controlled by a majority of persons, not limited to members of minority groups,

who are subject to racial or ethnic prejudice or cultural bias, but which do not qualify as small

businesses. In order for a business to qualify as “socially disadvantaged,” the offeror must

include in its proposal clear and convincing evidence to establish that the business has personally

suffered racial or ethnic prejudice or cultural bias stemming from the business person’s color,

ethnic origin or gender.

Questions regarding this Program can be directed to:

Department of General Services

Bureau of Minority and Women Business Opportunities

Room 611, North Office Building

Harrisburg, PA 17125

Phone: (717) 783-3119

Fax: (717) 787-7052

Email: gs-bmwbo@state.pa.us

Website: www.dgs.state.pa.us

A database of BMWBO-certified minority- and women-owned businesses can be accessed at

http://www.dgsweb.state.pa.us/mbewbe/VendorSearch.aspx. The federal vendor database can be

accessed at http://www.ccr.gov by clicking on Dynamic Small Business Search (certified

companies are so indicated).

I-15. Information concerning Small Businesses in Enterprise Zones.

The Issuing Office encourages participation by small businesses, whose primary or headquarters

facility is physically located in areas the Commonwealth has identified as Designated Enterprise

Zones, as prime contractors, joint ventures and subcontractors/suppliers.

The definition of headquarters includes, but is not limited to, an office or location that is the

administrative center of a business or enterprise where most of the important functions of the

business are conducted or concentrated and location where employees are conducting the

5

business of the company on a regular and routine basis so as to contribute to the economic

development of the geographical area in which the office or business is geographically located.

Small businesses are businesses in the United States which are independently owned, are not

dominant in their field of operation, employ no more than 100 full-time or full-time equivalent

employees, and earn less than $20 million in gross annual revenues ($25 million in gross annual

revenues for those businesses in the information technology sales or service business).

There is no database or directory of small businesses located in Designated Enterprise Zones.

Information on the location of Designated Enterprise Zones can be obtained by contacting:

Aldona M. Kartorie

Center for Community Building

PA Department of Community and Economic Development

4th

Floor, Commonwealth Keystone Building

400 North Street

Harrisburg, PA 17120-0225

Phone: (717) 720-7409

Fax: (717) 787-4088

Email: akartorie@state.pa.us

I. 16. Economy of Preparation. Offerors should prepare proposals simply and economically,

providing a straightforward, concise description of the Offeror’s ability to meet the requirements

of the RFP.

I. 17. Alternate Proposals. The Issuing Office has identified the basic approach to meeting its

requirements, allowing Offerors to be creative and propose their best solution to meeting these

requirements. The Issuing Office will not accept alternate proposals.

I. 18. Discussions for Clarification. Offerors may be required to make an oral or written

clarification of their proposals to the Issuing Office to ensure thorough mutual understanding and

Offeror responsiveness to the solicitation requirements. The Issuing Office will initiate requests

for clarification. Clarifications may occur at any stage of the evaluation and selection process

prior to contract execution.

I. 19. Prime Contractor Responsibilities. The contract will require the selected Offeror to

assume responsibility for all services offered in its proposal whether it produces them itself or by

subcontract. The Issuing Office will consider the selected Offeror to be the sole point of contact

with regard to contractual matters.

I. 20. Proposal Contents.

A. Confidential Information. The Commonwealth is not requesting, and does not

require, confidential proprietary information or trade secrets to be included as part of Offerors’

submissions in order to evaluate proposals submitted in response to this RFP. Accordingly,

except as provided herein, Offerors should not label proposal submissions as confidential or

6

proprietary or trade secret protected. Any Offeror who determines that it must divulge such

information as part of its proposal must submit the signed written statement described in

subsection c. below and must additionally provide a redacted version of its proposal, which

removes only the confidential proprietary information and trade secrets, for required public

disclosure purposes.

B. Commonwealth Use. All material submitted with the proposal shall be considered the

property of the Commonwealth of Pennsylvania and may be returned only at the Issuing Office’s

option. The Commonwealth has the right to use any or all ideas not protected by intellectual

property rights that are presented in any proposal regardless of whether the proposal becomes

part of a contract. Notwithstanding any Offeror copyright designations contained on proposals,

the Commonwealth shall have the right to make copies and distribute proposals internally and to

comply with public record or other disclosure requirements under the provisions of any

Commonwealth or United States statute or regulation, or rule or order of any court of competent

jurisdiction.

C. Public Disclosure. After the award of a contract pursuant to this RFP, all proposal

submissions are subject to disclosure in response to a request for public records made under the

Pennsylvania Right-to-Know-Law, 65 P.S. § 67.101, et seq. If a proposal submission contains

confidential proprietary information or trade secrets, a signed written statement to this effect

must be provided with the submission in accordance with 65 P.S. § 67.707(b) for the information

to be considered exempt under 65 P.S. § 67.708(b)(11) from public records requests. Financial

capability information submitted in response to Part II, Section II-7 of this RFP is exempt from

public records disclosure under 65 P.S. § 67.708(b)(26).

D. Best and Final Offers.

1. While not required, the Issuing Office reserves the right to conduct discussions

with Offerors for the purpose of obtaining “best and final offers.” To obtain best

and final offers from Offerors, the Issuing Office may do one or more of the

following, in any combination and order:

a) Schedule oral presentations;

b) Request revised proposals;

c) Conduct a reverse online auction; and

d) Enter into pre-selection negotiations.

2. The following Offerors will not be invited by the Issuing Office to submit a Best

and Final Offer:

a) Those Offerors, which the Issuing Office has determined to be not

responsible or whose proposals the Issuing Office has determined to be

not responsive.

7

b) Those Offerors, which the Issuing Office has determined in accordance

with Part III, Section III-5, from the submitted and gathered financial and

other information, do not possess the financial capability, experience or

qualifications to assure good faith performance of the contract.

c) Those Offerors whose score for their technical submittal of the proposal is

less than 70% of the total amount of technical points allotted to the

technical criterion.

The issuing office may further limit participation in the best and final offers process to those

remaining responsible offerors which the Issuing Office has, within its discretion, determined to

be within the top competitive range of responsive proposals.

The Evaluation Criteria found in Part III, Section III-4, shall also be used to evaluate the Best

and Final offers.

Price reductions offered through any reverse online auction shall have no effect upon the

Offeror’s Technical Submittal. Dollar commitments to Disadvantaged Businesses and Enterprise

Zone Small Businesses can be reduced only in the same percentage as the percent reduction in

the total price offered through any reverse online auction or negotiations.

I. 21. News Releases. Offerors shall not issue news releases, Internet postings, advertisements

or any other public communications pertaining to this Project without prior written approval of

the Issuing Office, and then only in coordination with the Issuing Office.

I. 22. Restriction of Contact. From the issue date of this RFP until the Issuing Office selects a

proposal for award, the Issuing Officer is the sole point of contact concerning this RFP. Any

violation of this condition may be cause for the Issuing Office to reject the offending Offeror’s

proposal. If the Issuing Office later discovers that the Offeror has engaged in any violations of

this condition, the Issuing Office may reject the offending Offeror’s proposal or rescind its

contract award. Offerors must agree not to distribute any part of their proposals beyond the

Issuing Office. An Offeror who shares information contained in its proposal with other

Commonwealth personnel and/or competing Offeror personnel may be disqualified.

I. 23. Issuing Office Participation. Offerors shall provide all services, supplies, facilities, and

other support necessary to complete the identified work, except as otherwise provided in this

Part I, Section I-23.

SWIF will provide only audit contact information as outlined in Part IV of this RFP. Offers are

required to provide all services, supplies’ facilities and other support necessary to complete

identified work.

I. 24. Term of Contract. The term of the contract will commence on the Effective Date and

will end three years from the effective date. The Issuing Office retains the right to renew this

contract for two additional one (1) year periods. The decision to renew will be at the Issuing

8

Office’s discretion. Rates may be increased by an amount not to exceed 10% after the first three

year term at the mutual agreement of SWIF and the selected Offeror. The Issuing Office will fix

the Effective Date after the contract has been fully executed by the selected Offeror and by the

Commonwealth and all approvals required by Commonwealth contracting procedures have been

obtained. The selected Offeror shall not start the performance of any work prior to the Effective

Date of the contract and the Commonwealth shall not be liable to pay the selected Offeror for

any service or work performed or expenses incurred before the Effective Date of the contract.

I. 25. Offeror’s Representations and Authorizations. By submitting its proposal, each Offeror

understands, represents, and acknowledges that:

A. All of the Offeror’s information and representations in the proposal are material and

important, and the Issuing Office may rely upon the contents of the proposal in awarding the

contract(s). The Commonwealth shall treat any misstatement, omission or misrepresentation as

fraudulent concealment of the true facts relating to the Proposal submission, punishable pursuant

to 18 Pa. C.S. § 4904.

B. The Offeror has arrived at the price(s) and amounts in its proposal independently and

without consultation, communication, or agreement with any other Offeror or potential offeror.

C. The Offeror has not disclosed the price(s), the amount of the proposal, nor the

approximate price(s) or amount(s) of its proposal to any other firm or person who is an Offeror

or potential offeror for this RFP, and the Offeror shall not disclose any of these items on or

before the proposal submission deadline specified in the Calendar of Events of this RFP.

D. The Offeror has not attempted, nor will it attempt, to induce any firm or person to refrain

from submitting a proposal on this contract, or to submit a proposal higher than this proposal, or

to submit any intentionally high or noncompetitive proposal or other form of complementary

proposal.

E. The Offeror makes its proposal in good faith and not pursuant to any agreement or

discussion with, or inducement from, any firm or person to submit a complementary or other

noncompetitive proposal.

F. To the best knowledge of the person signing the proposal for the Offeror, the Offeror, its

affiliates, subsidiaries, officers, directors, and employees are not currently under investigation by

any governmental agency and have not in the last four years been convicted or found liable for

any act prohibited by State or Federal law in any jurisdiction, involving conspiracy or collusion

with respect to bidding or proposing on any public contract, except as the Offeror has disclosed

in its proposal.

G. To the best of the knowledge of the person signing the proposal for the Offeror and

except as the Offeror has otherwise disclosed in its proposal, the Offeror has no outstanding,

delinquent obligations to the Commonwealth including, but not limited to, any state tax liability

not being contested on appeal or other obligation of the Offeror that is owed to the

Commonwealth.

9

H. The Offeror is not currently under suspension or debarment by the Commonwealth, any

other state or the federal government, and if the Offeror cannot so certify, then it shall submit

along with its proposal a written explanation of why it cannot make such certification.

I. The Offeror has not made, under separate contract with the Issuing Office, any

recommendations to the Issuing Office concerning the need for the services described in its

proposal or the specifications for the services described in the proposal.

J. Each Offeror, by submitting its proposal, authorizes Commonwealth agencies to release

to the Commonwealth information concerning the Offeror's Pennsylvania taxes, unemployment

compensation and workers’ compensation liabilities.

K. Until the selected Offeror receives a fully executed and approved written contract from

the Issuing Office, there is no legal and valid contract, in law or in equity, and the Offeror shall

not begin to perform.

I. 26. Notification of Selection.

A. Contract Negotiations. The Issuing Office will notify all Offerors in writing of the

Offeror selected for contract negotiations after the Issuing Office has determined, taking into

consideration all of the evaluation factors, the proposal that is the most advantageous to the

Issuing Office.

B. Award. Offerors whose proposals are not selected will be notified when contract

negotiations have been successfully completed and the Issuing Office has received the final

negotiated contract signed by the selected Offeror.

I. 27. Debriefing Conferences. Upon notification of award, Offerors whose proposals were

not selected will be given the opportunity to be debriefed. The Issuing Office will schedule the

debriefing at a mutually agreeable time. The debriefing will not compare the Offeror with other

Offerors, other than the position of the Offeror’s proposal in relation to all other Offeror

proposals. An Offeror’s exercise of the opportunity to be debriefed does not constitute nor toll

the time for filing a protest (See Section I-28 of this RFP).

I. 28. RFP Protest Procedure. The RFP Protest Procedure is on the DGS website at

http://www.dgsweb.state.pa.us/comod/ProtestProcedures.doc. A protest by a party not submitting

a proposal must be filed within seven days after the protesting party knew or should have known

of the facts giving rise to the protest, but no later than the proposal submission deadline specified

in the Calendar of Events of the RFP. Offerors may file a protest within seven days after the

protesting Offeror knew or should have known of the facts giving rise to the protest, but in no

event may an Offeror file a protest later than seven days after the date the notice of award of the

contract is posted on the DGS website. The date of filing is the date of receipt of the protest. A

protest must be filed in writing with the Issuing Office. To be timely, the protest must be

received by 4:00 p.m. on the seventh day.

10

I. 29. Use of Electronic Versions of this RFP. This RFP is being made available by electronic

means. If an Offeror electronically accepts the RFP, the Offeror acknowledges and accepts full

responsibility to insure that no changes are made to the RFP. In the event of a conflict between a

version of the RFP in the Offeror’s possession and the Issuing Office’s version of the RFP, the

Issuing Office’s version shall govern.

11

PART II

PROPOSAL REQUIREMENTS

Offerors must submit their proposals in the format, including heading descriptions, outlined

below. To be considered, the proposal must respond to all requirements in this part of the RFP.

Offerors should provide any other information thought to be relevant, but not applicable to the

enumerated categories, as an appendix to the Proposal. All cost data relating to this proposal and

all Disadvantaged Business cost data should be kept separate from and not included in the

Technical Submittal. Each Proposal shall consist of the following three separately sealed

submittals:

A. Technical Submittal, which shall be a response to RFP Part II, Sections II-1

through II-8;

B. Disadvantaged Business Submittal, in response to RFP Part II, Section II-9; and,

C. Cost Submittal, in response to RFP Part II, Section II-10.

The Issuing Office reserves the right to request additional information which, in the Issuing

Office’s opinion, is necessary to assure that the Offeror’s competence, number of qualified

employees, business organization, and financial resources are adequate to perform according to

the RFP.

The Issuing Office may make investigations as deemed necessary to determine the ability of the

Offeror to perform the Project, and the Offeror shall furnish to the Issuing Office all requested

information and data. The Issuing Office reserves the right to reject any proposal if the evidence

submitted by, or investigation of, such Offeror fails to satisfy the Issuing Office that such Offeror

is properly qualified to carry out the obligations of the RFP and to complete the Project as

specified.

II. 1. Statement of the Problem. State in succinct terms your understanding of the problem

presented or the service required by this RFP.

II. 2. Management Summary. Include a narrative description of the proposed effort and a list

of the items to be delivered or services to be provided.

II. 3. Work Plan. Describe in narrative form your technical plan for accomplishing the work.

Use the task descriptions in Part IV of this RFP as your reference point. Modifications of the

task descriptions are permitted; however, reasons for changes should be fully explained. Indicate

the number of person hours allocated to each task. Include a Program Evaluation and Review

Technique (PERT) or similar type display, time related, showing each event. If more than one

approach is apparent, comment on why you chose this approach.

12

II. 4. Prior Experience. Include experience in performing workers’ compensation audits.

Experience shown should be work done by individuals who will be assigned to this project as

well as that of your company. Studies or projects referred to must be identified and the name of

the customer shown, including the name, address, and telephone number of the responsible

official of the customer, company, or agency who may be contacted.

II. 5. Personnel. Include the number of executive and professional personnel, analysts,

auditors, researchers, programmers, consultants, etc., who will be engaged in the work. Show

where these personnel will be physically located during the time they are engaged in the Project.

For key personnel, which include the Offeror’s auditors, contact person and persons with

responsibility for quality control, include the employee’s name and through a resume or similar

document, the Project personnel’s education and experience in workers’ compensation audits.

The minimum qualifications for an auditor are described in Part IV of this RFP. Indicate the

responsibilities each individual will have in this Project and how long each has been with your

company. Identify by name any subcontractors you intend to use and the services they will

perform.

II. 6. Training. If appropriate, indicate recommended training of agency personnel. Include

the agency personnel to be trained, the number to be trained, duration of the program, place of

training, curricula, training materials to be used, number and frequency of sessions, and number

and level of instructors.

II. 7. Financial Capability. Describe your company’s financial stability and economic

capability to perform the contract requirements. Provide your company’s financial statements

for the past three fiscal years. If your company is a publicly traded company, please provide a

link to your financial records on your company website; otherwise, provide three (3) years of

your company’s financial documents such as audited financial statements. Financial statements

must include the company’s Balance Sheet and Income Statement or Profit/Loss Statements.

Also include a Dun & Bradstreet comprehensive report if available. The Commonwealth

reserves the right to request additional information it deems necessary to evaluate an Offeror’s

financial capability.

II. 8. Objections and Additions to Standard Contract Terms and Conditions. The Offeror

will identify which, if any, of the terms and conditions (contained in Appendix A) it would like

to negotiate and what additional terms and conditions the Offeror would like to add to the

standard contract terms and conditions. The Offeror’s failure to make a submission under this

paragraph will result in its waiving its right to do so later, but the Issuing Office may consider

late objections and requests for additions if to do so, in the Issuing Office’s sole discretion,

would be in the best interest of the Commonwealth. The Issuing Office may, in its sole

discretion, accept or reject any requested changes to the standard contract terms and conditions.

The Offeror shall not request changes to the other provisions of the RFP, nor shall the Offeror

request to completely substitute its own terms and conditions for Appendix A. All terms and

conditions must appear in one integrated contract. The Issuing Office will not accept references

to the Offeror’s, or any other, online guides or online terms and conditions contained in any

proposal.

13

Regardless of any objections set out in its proposal, the Offeror must submit its proposal,

including the cost proposal, on the basis of the terms and conditions set out in Appendix A. The

Issuing Office will reject any proposal that is conditioned on the negotiation of the terms and

conditions set out in Appendix A. The issuing office will reject any proposal that is conditioned

on the negotiation of terms and conditions other than those set out in Appendix A.

II. 9. Disadvantaged Business Submittal.

A. Disadvantaged Business Information.

1. To receive credit for being a Small Disadvantaged Business or a Socially

Disadvantaged Business or for entering into a joint venture agreement with a

Small Disadvantaged Business or for subcontracting with a Small Disadvantaged

Business (including purchasing supplies and/or services through a purchase

agreement), a Offeror must include proof of Disadvantaged Business qualification

in the Disadvantaged Business Submittal of the proposal, as indicated below:

a) A Small Disadvantaged Businesses certified by BMWBO as an

MBE/WBE must provide a photocopy of their BMWBO certificate.

b) Businesses certified by the U.S. Small Business Administration pursuant

to Section 8(a) of the Small Business Act (15 U.S.C. § 636(a)) as an 8(a)

Small Disadvantaged Businesses must submit proof of U.S. Small

Business Administration certification. The owners of such businesses

must also submit proof of United States citizenship.

c) All businesses claiming Small Disadvantaged Business status, whether as

a result of BMWBO certification, or U.S. Small Business Administration

certification as an 8(a) small disadvantaged business, must attest to the

fact that the business has no more than 100 full-time or full-time

equivalent employees.

d) All businesses claiming Small Disadvantaged Business status, whether as

a result of BMWBO certification, or U.S. Small Business Administration

certification as an 8(a) small disadvantaged business, must submit proof

that their gross annual revenues are less than $20,000,000 ($25,000,000

for those businesses in the information technology sales or service

business). This can be accomplished by including a recent tax return or

audited financial statement.

2. All businesses claiming status as a Socially Disadvantaged Business must include

in the Disadvantaged Business Submittal of the proposal clear and convincing

evidence to establish that the business has personally suffered racial or ethnic

prejudice or cultural bias stemming from the business person’s color, ethnic origin

or gender. The submitted evidence of prejudice or bias must:

14

a) Be rooted in treatment that the business person has experienced in

American society, not in other countries.

b) Show prejudice or bias that is chronic and substantial, not fleeting or

insignificant.

c) Indicate that the business person’s experience with the racial or ethnic

prejudice or cultural bias has negatively impacted his or her entry into

and/or advancement in the business world.

BMWBO shall determine whether the Offeror has established that a business is socially

disadvantaged by clear and convincing evidence.

3. In addition to the above verifications, the Offeror must include in the

Disadvantaged Business Submittal of the proposal the following information:

a) Those Small Disadvantaged Businesses submitting a proposal as the

Offeror, must include a numerical percentage which represents the total

percentage of the work (as a percentage of the total cost in the Cost

Submittal) to be performed by the Offeror and not by subcontractors and

suppliers.

b) Those Small Disadvantaged Businesses submitting a proposal as a part of

a joint venture partnership, must include a numerical percentage which

represents the total percentage of the work (as a percentage of the total

cost in the Cost Submittal) to be performed by the Small Disadvantaged

Business joint venture partner and not by subcontractors and suppliers or

by joint venture partners who are not Small Disadvantaged Businesses.

Offeror must also provide:

1) The amount of capital, if any, each Small Disadvantaged Business

joint venture partner will be expected to provide.

2) A copy of the joint venture agreement signed by all parties.

3) The business name, address, name and telephone number of the

primary contact person for the Small Disadvantaged Business joint

venture partner.

c) All Offerors must include a numerical percentage which represents the

total percentage of the total cost in the Cost Submittal that the Offeror

commits to paying to Small Disadvantaged Businesses as subcontractors.

To support its total percentage DB subcontractor commitment, Offeror

must also include:

15

1) The dollar amount of each subcontract commitment to a Small

Disadvantaged Business;

2) The name of each Small Disadvantaged Business. The Offeror

will not receive credit for stating that after the contract is awarded

it will find a Small Disadvantaged Business.

3) The services or supplies each Small Disadvantaged Business will

provide, including the timeframe for providing the services or

supplies.

4) The location where each Small Disadvantaged Business will

perform services.

5) The timeframe for each Small Disadvantaged Business to provide

or deliver the goods or services.

6) A signed subcontract or letter of intent for each Small

Disadvantaged Business. The subcontract or letter of intent must

identify the specific work, goods or services the Small

Disadvantaged Business will perform and how the work, goods or

services relates to the project.

7) The name, address and telephone number of the primary contact

person for each Small Disadvantaged Business.

d) The total percentages and each subcontractor commitment will become

contractual obligations once the contract is fully executed.

e) The name and telephone number of the Offeror’s project (contact) person

for the Small Disadvantaged Business information.

4. The Offeror is required to submit two copies of its Disadvantaged Business

Submittal. The submittal shall be clearly identified as Disadvantaged Business

information and sealed in its own envelope, separate from the remainder of the

proposal.

5. A Small Disadvantaged Business can be included as a subcontractor with as many

prime contractors as it chooses in separate proposals.

6. An Offeror that qualifies as a Small Disadvantaged Business and submits a

proposal as a prime contractor is not prohibited from being included as a

subcontractor in separate proposals submitted by other Offerors.

16

B. Enterprise Zone Small Business Participation.

1. To receive credit for being an enterprise zone small business or entering into a

joint venture agreement with an enterprise zone small business or subcontracting

with an enterprise zone small business, an Offeror must include the following

information in the Disadvantaged Business Submittal of the proposal:

a) Proof of the location of the business’ headquarters (such as a lease or deed

or Department of State corporate registration), including a description of

those activities that occur at the site to support the other businesses in the

enterprise zone.

b) Confirmation of the enterprise zone in which it is located (obtained from

the local enterprise zone office).

c) Proof of United States citizenship of the owners of the business.

d) Certification that the business employs no more than 100 full-time or full-

time equivalent employees.

e) Proof that the business’ gross annual revenues are less than $20,000,000

($25,000,000 for those businesses in the information technology sales or

service business). This can be accomplished by including a recent tax

return or audited financial statement.

f) Documentation of business organization, if applicable, such as articles of

incorporation, partnership agreement or other documents of organization.

2. In addition to the above verifications, the Offeror must include in the

Disadvantaged Business Submittal of the proposal the following information:

a) The name and telephone number of the Offeror’s project (contact) person

for the Enterprise Zone Small Business.

b) The business name, address, name and telephone number of the primary

contact person for each Enterprise Zone Small Business included in the

proposal. The Offeror must specify each Enterprise Zone Small Business

to which it is making commitments. The Offeror will not receive credit

for stating that it will find an Enterprise Zone Small Business after the

contract is awarded or for listing several businesses and stating that one

will be selected later.

c) The specific work, goods or services each Enterprise Zone Small Business

will perform or provide.

17

d) The total cost amount submitted in the Offeror’s cost proposal and the

estimated dollar value of the contract to each Enterprise Zone Small

Business.

e) Of the estimated dollar value of the contract to each Enterprise Zone Small

Business, the percent of the total value of services or products purchased

or subcontracted that each Enterprise Zone Small Business will provide.

f) The location where each Enterprise Zone Small Business will perform

these services.

g) The timeframe for each Enterprise Zone Small Business to provide or

deliver the goods or services.

h) The amount of capital, if any, each Enterprise Zone Small Business will be

expected to provide.

i) The form and amount of compensation each Enterprise Zone Small

Business will receive.

j) For a joint venture agreement, a copy of the agreement, signed by all

parties.

k) For a subcontract, a signed subcontract or letter of intent.

3. The dollar value of the commitment to each Enterprise Zone Small Business must

be included in the same sealed envelope with the Disadvantaged Business

Submittal of the proposal. The following will become a contractual obligation

once the contract is fully executed:

a) The amount of the selected Offeror’s Enterprise Zone Small Business

commitment;

b) The name of each Enterprise Zone Small Business; and

c) The services each Enterprise Zone Small Business will provide, including

the timeframe for performing the services.

II – 10. Cost Submittal. The information requested in this Part II, Section II-10 shall constitute

the Cost Submittal and the information should be submitted on the Cost Form attached to this

RFP as Appendix E. The Cost Submittal shall be placed in a separate sealed envelope within the

sealed proposal, separated from the technical submittal. Any proposal failing to meet this

requirement will be automatically disqualified. The Cost Form requires Offerors to propose the

following costs for each geographic area that the Offeror seeks to service:

1. Total Cost Per Completed Audit. Propose the cost for an audit.

18

2. Cost Per Incomplete Audit. Propose the costs for audits that the selected

contractor is unable to complete, through no fault of the contractor.

3. Cost per Additional Location. Audits requiring that an audit vendor visit more

than one physical location will be eligible for additional compensation on a per

location basis. Propose the cost per additional location applicable to such audits.

4. Cost Per Hour for Large Audits. Audits requiring more than four hours of auditor

time to complete maybe eligible for additional compensation at an hourly rate, at

SWIF’S sole discretion, upon submission of a request for additional compensation

and review by SWIF. This review will include a review of the request, the audit,

any previous audits of the policyholder and SWIF’S file regarding the

policyholder. If SWIF determines that the request is justified, it will pay an

additional hourly rate of compensation, though SWIF may reduce the amount

requested based upon its review of the audit. Propose the hourly rate that will be

requested for such audits.

5. Cost submittal for Territory E (statewide) will include territories A, B and C.

Territory D (out of state) will not be included in statewide. Individual proposals

must also be submitted by individual Territorry (A,B,C) if vendor wishes to bid

on individual zones, if not chosen for Territory E (statewide).

The Issuing Office will reimburse the selected Offeror for work satisfactorily performed after

execution of a written contract and the start of the contract term, in accordance with contract

requirements, and only after the issuing office has issued a notice to proceed.

Offerors should not include any assumptions in their cost submittals. If the Offeror includes

assumptions in its cost submittal, the Issuing Office may reject the proposal. Offerors should

direct in writing to the Issuing Office pursuant to Part I, Section I-10, of this RFP any questions

about whether a cost or other component is included or applies. All Offerors will then have the

benefit of the Issuing Office’s written answer so that all proposals are submitted on the same

basis.

The Issuing Office will reimburse the selected Offeror for work satisfactorily performed after

execution of a written contract and the start of the contract term, in accordance with contract

requirements, and only after the Issuing Office has issued a notice to proceed.

Domestic Workforce Utilization Certification. Complete and sign the Domestic Workforce

Utilization Certification contained in Appendix B of this RFP. Offerors who seek consideration

for this criterion must submit in hardcopy the signed Domestic Workforce Utilization

Certification Form in the same sealed envelope with the Technical Submittal.

19

PART III

CRITERIA FOR SELECTION

III. 1. Mandatory Responsiveness Requirements. To be eligible for selection, a proposal

must be:

1. Timely received from an Offeror;

2. Properly signed by the Offeror.

III. 2. Technical Nonconforming Proposals. The two (2) Mandatory Responsiveness

Requirements set forth in Section III-1 above (A-B) are the only RFP requirements that the

Commonwealth will consider to be non-waivable. The Issuing Office reserves the right, in its

sole discretion, to (1) waive any other technical or immaterial nonconformities in an Offeror’s

proposal, (2) allow the Offeror to cure the nonconformity, or (3) consider the nonconformity in

the scoring of the Offeror’s proposal.

III. 3. Evaluation. The Issuing Office has selected a committee of qualified personnel to

review and evaluate timely submitted proposals. Independent of the committee, BMWBO will

evaluate the Disadvantaged Business Submittal and provide the Issuing Office with a rating for

this component of each proposal. The Issuing Office will notify in writing of its selection for

negotiation the responsible Offeror whose proposal is determined to be the most advantageous to

the Commonwealth as determined by the Issuing Office after taking into consideration all of the

evaluation factors.

III. 4. Evaluation Criteria. The following criteria will be used in evaluating each proposal:

1. Technical: The Issuing Office has established the weight for the Technical

criterion for this RFP as 50% of the total points.

Evaluation will be based upon the following:

a) Soundness of Approach. This emphasizes the techniques for collecting

and analyzing data, sequence and relationships of major steps, and

methods for managing the study /service. Of equal importance is whether

the technical approach is completely responsive to all written

specifications and requirements contained in the RFP and if it appears to

meet agency objectives.

b) Personnel Qualification. This refers to the competence of

professional personnel who would be assigned to the job by the

Offeror. Qualifications of professional personnel will be measured by

experience and education, with particular reference to experience on

studies/services similar to that described in the RFP.

20

c) Contractor Qualifications. This refers to the ability of the Offeror to

meet there terms of the RFP, especially the time constraint, and the

quality relevancy, and recent of studies and projects completed by the

contractor. This also includes the contractor’s financial ability to

undertake a project of this size. The Issuing Office requires the Offeror to

submit a copy of its most recent audited financial statement or tax return.

d) Understanding the Problem. This refers to the Offeror’s

understanding of the Issuing Office’s needs that generated the RFP, of the

objectives in asking for the services or undertaking the study, and of the

nature and scope of the work involved.

III 5. Cost: The Issuing Office has established the weight for the Cost criterion for this RFP

as 30% of the total points.

III. 6. Disadvantaged Business Participation: BMWBO has established the weight for the

Disadvantaged Business (DB) Participation criterion for this RFP as 20 % of the total points.

Evaluation will be based upon the following in order of priority:

Priority Rank 1 Proposals submitted by Small Disadvantaged Businesses.

Priority Rank 2 Proposals submitted from a joint venture with a Small

Disadvantaged Business as a joint venture partner.

Priority Rank 3 Proposals submitted with subcontracting commitments to Small

Disadvantaged Businesses.

Priority Rank 4 Proposals submitted by Socially Disadvantaged Businesses.

Each DB Participation Submittal will be rated for its approach to enhancing the utilization of

Small Disadvantaged Businesses and/or Socially Disadvantaged Businesses. Each approach will

be evaluated, with Priority Rank 1 receiving the highest score and the succeeding options

receiving scores in accordance with the above-listed priority ranking. To the extent that there are

multiple DB Participation submittals that offer subcontracting commitments to Small

Disadvantaged Businesses, the proposal offering the highest total percentage commitment shall

receive the highest score in the Priority Rank 3 category and the other proposal(s) in that

category shall be scored in proportion to the highest total percentage commitment offered.

To qualify as a Small Disadvantaged Business or a Socially Disadvantaged Business, the Small

Disadvantaged Business or Socially Disadvantaged Business cannot enter into subcontract

arrangements for more than 40% of the total estimated dollar amount of the contract. If a Small

Disadvantaged Business or a Socially Disadvantaged Business subcontracts more than 40% of

the total estimated dollar amount of the contract to other contractors, the Disadvantaged Business

Participation scoring shall be proportionally lower for that proposal.

21

III. 7. Enterprise Zone Small Business Participation. In accordance with the priority ranks

listed below, bonus points in addition to the total points for this RFP, will be given for the

Enterprise Zone Small Business Participation criterion. The maximum bonus points for this

criterion is 3% of the total points for this RFP. The following options will be considered as part

of the final criteria for selection:

Priority Rank 1 Proposals submitted by an Enterprise Zone Small Business will

receive three percent bonus for this criterion.

Priority Rank 2 Proposals submitted by a joint venture with an Enterprise Zone

Small Business as a joint venture partner will receive two percent

bonus for this criterion.

Priority Rank 3 Proposals submitted with a subcontracting commitment to an

Enterprise Zone Small Business will receive the one percent bonus

for this criterion.

Priority Rank 4 Proposals with no Enterprise Zone Small Business Utilization shall

receive no points under this criterion.

To the extent that an Offeror is an Enterprise Zone Small Business, the Offeror cannot enter into

contract or subcontract arrangements for more than 40% of the total estimated dollar amount of

the contract in order to qualify as an Enterprise Zone Small Business for purposes of this RFP.

III. 8. Domestic Workforce Utilization: Any points received for the Domestic Workforce

Utilization criterion are bonus points in addition to the total points for this RFP. The maximum

bonus points for this criterion is 3% of the total points for this RFP. To the extent permitted by

the laws and treaties of the United States, each proposal will be scored for its commitment to use

domestic workforce in the fulfillment of the contract. Maximum consideration will be given to

those Offerors who will perform the contracted direct labor exclusively within the geographical

boundaries of the United States or within the geographical boundaries of a country that is a party

to the World Trade Organization Government Procurement Agreement. Those who propose to

perform a portion of the direct labor outside of the United States and not within the geographical

boundaries of a party to the World Trade Organization Government Procurement Agreement will

receive a correspondingly smaller score for this criterion. Offerors who seek consideration for

this criterion must submit in hardcopy the signed Domestic Workforce Utilization Certification

Form in the same sealed envelope with the Technical Submittal. The certification will be

included as a contractual obligation when the contract is executed.

III-9. Offeror Responsibility. To be responsible, an Offeror must submit a responsive proposal

and possess the capability to fully perform the contract requirements in all respects and the

integrity and reliability to assure good faith performance of the contract.

In order for an Offeror to be considered responsible for this RFP and therefore eligible for

selection for best and final offers or selection for contract negotiations:

22

The total score for the technical submittal of the Offeror’s proposal must be greater than or equal

to 70% of the available technical points; and,

The Offeror’s financial information must demonstrate that the Offeror possesses the financial

capability to assure good faith performance of the contract. The Issuing Office will review the

Offeror’s previous three financial statements, any additional information received from the

Offeror, and any other publicly-available financial information concerning the Offeror, and

assess each Offeror’s financial capacity based on calculating and analyzing various financial

ratios, and comparison with industry standards and trends.

An Offeror which fails to demonstrate sufficient financial capability to assure good faith

performance of the contract as specified herein may be considered by the Issuing Office, in its

sole discretion, for Best and Final Offers or contract negotiation contingent upon such Offeror

providing contract performance security for the first contract year cost proposed by the Offeror

in a form acceptable to the Issuing Office. Based on the financial condition of the Offeror, the

Issuing Office may require a certified or bank (cashier’s) check, letter of credit, or a performance

bond conditioned upon the faithful performance of the contract by the Offeror. The required

performance security must be issued or executed by a bank or surety company authorized to do

business in the Commonwealth. The cost of the required performance security will be the sole

responsibility of the Offeror and cannot increase the Offeror’s cost proposal or the contract cost

to the Commonwealth.

Further, the Issuing Office will award a contract only to an Offeror determined to be responsible

in accordance with the most current version of Commonwealth Management Directive 215.9,

Contractor Responsibility Program.

23

PART IV

WORK STATEMENT

IV. 1 Objectives.

A. General. SWIF wishes to have selected Offerors conduct workers’ compensation audits

and underwriting visits for selected policyholders. Selected Offerors must contact the insured

and perform an on site audit or underwriting visit utilizing all available payroll and other

remuneration data per Part Five of the Workers’ Compensation and Employers’ Liability

Insurance Policy issued by SWIF, which is attached to this RFP at Appendix G. Selected

Offerors must take into consideration all pertinent and applicable rules and explanations of the

Pennsylvania Compensation Rating Bureau (PCRB) and the Pennsylvania Coal Mine Rating

Bureau (PCMRB).

SWIF may change the parameters of the program at any time during the term of the contract.

SWIF must follow the direction of the PCRB, the Insurance Department and the Department of

Labor and Industry. In addition, SWIF can be subject to legislative changes that affect its

operations. Therefore, SWIF must maintain the flexibility to adjust the requirements of this

program.

B. Specific. SWIF seeks Offerors to conduct through audits and underwriting visits

of SWIF policyholders.

An audit for SWIF is not just a payroll audit, it is a workers’ compensation audit of all

entities listed under the policy. This means that the audit must analyze payroll as well as

class distribution for that payroll. The analysis must include a review of claims,

certificates of insurance, the alternate employer endorsement, if applicable, owner-officer

information, location(s) verification, classification assignments per the respective

employees and the business activity itself.

SWIF currently requires an audit for all policyholders. If the annual policy premium is $999.99

or less, it is a voluntary audit. If the annual premium is equal to or greater than

$1,000, it is a provider audit.

At SWIF’s discretion, any new policy issued may be subject to an underwriting visit

performed by a selected Offeror. The purpose of an underwriting visit is to determine

the accuracy of the insured’s application to SWIF with respect to payroll and employee

classification. The selected Offeror will identify the payroll sources that are required to

complete the final audit that occurs at the end of the policy period to the policyholder. If

applicable, the selected Offeror will explain SWIF’s position on the use of subcontractors,

contracts and independent contractor questionnaires and the need for an alternate

employer endorsement if a PEO, temporary employment contractor or leasing company is

24

involved.

IV 2. Nature and Scope of the Project.

A selected Offeror will perform the required services (see Part IV-4 below) in the geographical

territories outlined in Appendix C. An Offeror may submit a proposal for any or all of the

territories outlined. An Offeror must be able to service any audits assigned within the territory.

Furthermore, an Offeror must submit the appropriate cost proposal form for each territory in

which it proposes to provide services. For example, if an Offeror is interested in providing

services in Territories A, B, C and D, it must submit four (4) cost proposal forms.

Offeror must also submit separate cost proposal forms for statewide proposals if submitting a

proposal for statewide services. Statewide proposals will cover Territories A, B and C.

Individual proposals must also be submitted by individual Territory (A,B,C) if vendor wishes to

bid on individual zones, if not chosen for Territory E (statewide). Cost proposal forms are

attached to this RFP at Appendix E.

Additional consideration will be given to cost proposals that offer reduced rates for statewide

service.

SWIF may award three contracts in any of the geographic territories. SWIF may also award

more than one contract to an Offeror; in other words, an Offeror may provide services in more

than just one geographic territory. Initially, SWIF will equally divide the audits assigned among

all selected Offerors in each territory. SWIF reserves the right to adjust assignments based upon

selected Offeror performance during the term of the contract.

IV 3. Requirements.

1. The processing of audits for SWIF requires an in-depth knowledge of the

rules and regulations established by the Pennsylvania Compensation Rating

Bureau (PCRB), the Pennsylvania Coal Mine Compensation Rating Bureau

(PCMCRB), and the

Pennsylvania Insurance Department and an understanding of commonly

accepted industry-wide auditing standards. Describe your knowledge and

experience.

2. SWIF requires that each auditor, working under the contract proposed by

this RFP, meet one (1) of the following criteria:

a) A four (4) year college degree, with one (1) year practical

experience in performing workers’ compensation audits.

b) An Associate’s Degree, or equivalent; to include and Associate

in Premium Auditing (APA) from the American Institute for

Chartered Property Casualty Underwriting IIA (AICPCU IIA),

25

and two (2) years of experience.

c) Four (4) years of workers’ compensation audit experience. Describe how

your auditors will meet these requirements.

SWIF reserves the right to waive auditor qualifications during the term of the contract.

3. An Offeror must have sufficient staff to meet SWIF’s audit needs. For each

Territory for which you are submitting a proposal, please indicate how many

auditors will be assigned to that Territory. This information should be provided

on Appendix H that is attached to this RFP. Charts setting forth the current

number of policies for each Territory are attached hereto as Appendix D.

4. An Offeror must have a program for continuing education. Describe, in detail,

your continuing education program, including how you will ensure that every

auditor performing work for SWIF will receive continuing education.

5. A selected contractor must provide appropriate current certificates of insurance

evidencing at least a $1,000,000.00 single limit general liability insurance policy

and a $1,000,000.00 single limit errors and omissions insurance policy. The

certificates of insurance must be provided before any contract is awarded.

Describe how you will monitor these requirements.

6. All audit and underwriting visit reports must be computer generated. Auditors

must complete audits using lap top computers. A copy of the computer form that

will be used must be submitted with any offer. SWIF shall approve the software

proposed by an Offeror. Please provide information regarding the software that

you will use, including the name of the software program, the version of the

program, and the operating system it uses.

IV. 4. Emergency Preparedness.

To support continuity of operations during an emergency, including a pandemic, the

Commonwealth needs a strategy for maintaining operations for an extended period of time. One

part of this strategy is to ensure that essential contracts that provide critical business services to

the Commonwealth have planned for such an emergency and put contingencies in place to

provide needed goods and services.

1. Describe how you anticipate such a crisis will impact your operations.

2. Describe your emergency response continuity of operations plan. Please attach a

copy of your plan, or at a minimum, summarize how your plan addresses the

following aspects of pandemic preparedness:

a) Employee Training (describe your organization’s training plan, and how

frequently your plan will be shared with employees)

26

b) Identified essential business functions and key employees (within your

organization) necessary to carry out contingency plans for:

1. How your organization will handle staffing issues when a

portion of key employees are incapacitated due to illness.

2. How employees in your organization will carry out the essential

functions if contagion control measures prevent them from coming

to the primary workplace.

3. How your organization will communicate with staff and suppliers

when primary communications systems are overloaded or

otherwise fail, including key contacts, chain of communications

(including suppliers), etc.

4. How and when your emergency plan will be tested, and if the plan

will be tested by a third-party.

IV. 5. Tasks.

A. Describe how you would complete the following types of audits:

1. Regular Audits. Audits performed on accounts at the end of the policy term.

2. Interim Audits. Audits performed at SWIF’s discretion at any point during the

policy term.

3. Underwriting Visit. Visits scheduled on particular accounts, at SWIF’s

discretion, in order to determine proper underwriting of the policy. These can be

scheduled at any time during the policy term. Underwriting visits are not

scheduled for out of state locations.

4. Pre Policy Issuance Audits. Audits designed to obtain actual payrolls prior to

incepting policy coverage rather than accepting estimated remuneration.

B. Audit Timing. It is important that SWIF audits are completed in a timely manner.

Below are SWIF”s timing requirements. Describe in detail what steps you will take to

ensure that you meet the following guidelines:

1. For Regular Audits, SWIF will provide the audit information to a selected

contractor 45 days prior to the expiration date of the policy. This information will

include the name, address, and telephone number of the audit contact for the

policyholder. The selected Offeror may contact the policyholder prior to the

expiration date of the policy, but cannot conduct the audit until the policy has

expired. Regular Audits must be completed and the appropriate form returned to

27

SWIF within 30 calendar days after the expiration date of the policy. On day 31,

SWIF sends out a 2nd

notice to the auditors, which afford them an additional 30

calendar days to conduct the audit for a total of 60 days.

2. For Interim Audits and Pre Policy Audits, the selected Offeror must complete the

audit and return the appropriate form to SWIF within 30 calendar days of receipt

of the audited information.

3. SWIF will provide audit information to the vendor on cancelled policies the week

that the policy becomes inactive. The selected Offeror must complete the audit

and return the appropriate form to SWIF within 30 calendar days of receipt of the

audit information.

4. Underwriting Visits must be completed and the appropriate form returned to

SWIF within 30 calendar days of assignment to the selected contractor.

5. If an Audit or Underwriting Visit cannot be conducted within the prescribed time

period, the selected Offeror must submit a status report to SWIF providing the

reason for the delay and advising when the Audit or Underwriting Visit will be

completed. An initial status report must be submitted when the audit report would

otherwise be due—30 calendar days after the expiration date of the policy.

IV. 6. Audit Information. It is the Offeror’s obligation to provide SWIF with all pertinent

information, including changes in operation, class, entity, ownership and location that have an

effect on the audited payroll results in the Audit or Underwriting Visit report. The Offeror must

obtain the business(es) Federal Tax I.D. Number(s) and Social Security Number(s), for all

Owners and Officers and verify if the owner(s) or officers are included or exempt from coverage.

Further, the Offeror must be familiar with the Pennsylvania Compensation Rating Bureau and

Pennsylvania Coal Mine Compensation Rating Bureau rules pertaining to the coverage

requirements relating to officers, owners and members of non profit corporation. The Offeror

must determine the total number of employees in each class of payroll, provide a description of

the work performed by each employee and include a detailed narrative of the business operation.

Describe how you will ensure that your reports will include all required information.

IV. 7. Subcontractor Information. The selected Offeror must secure information on all

subcontractors, including workers’ compensation certificates of insurance, which run

concurrently with the policy term. A policyholder is required to produce certificates of insurance

evidencing workers’ compensation insurance coverage for all subcontractors, listing their names,

amounts paid, and a description of the work performed by the respective subcontractors. For the

subcontractors, who are unable to produce workers’ compensation certificates of insurance, the

auditor must procure the names, amounts paid, description of the work performed and a copy of

certificates of insurance evidencing general liability. Describe how you will collect this

information which will be provided to SWIF.

IV. 8. Special Audits. Certain classes of business typically require greater Audit attention.

These classes include trucking companies, building contractors, coal mining operations,

28

temporary employment agencies and employee leasing companies. In each of these classes, the

auditor must carefully scrutinize the information given before classifying the operation and

assigning payroll. With respect to temporary employment agencies and employee leasing

companies, the selected Offeror must be familiar with the definition and rules relating to classes

and cross referenced classes for temporary employment contractors as set forth in the PCRB

Manual. Describe how you will properly analyze the claim data and alternate employer listing to

assure that the clients are properly classified.

IV. 9 Audit Questions. The selected Offeror must provide a copy of the audit results to the

insured and answer any questions relating to the audit, including payroll class assignments and

payroll assignments for corporate officers, sole proprietors, partners, and LLC members. Also, a

detailed description must be included in the report. Describe how you will collect this

information and provide it to SWIF.

IV. 10. Report Review. To assure that SWIF includes all payroll for compensation purposes,

the selected Offeror must thoroughly review all financial records, including 1099 Miscellaneous

Filings (if applicable) and schedule C tax forms for sole proprietors and Schedule E forms for

partners. Describe your process for meeting this requirement.

IV. 11. Audit Documentation. The payroll documentation used to complete an Audit must be

within the “16-day period” required by the PCRB and explained in the PCRB Manual. There

must the two (2) sources of payroll verification. Acceptable forms of payroll verification include

general ledgers, check books, cash disbursement journals, general ledgers, UC2 and 941 reports.

Describe your process for meeting this requirement.

IV. 12. Copies of the Audit. A selected Offeror shall electronically submit a PDF formatted

version of a completed Audit report to SWIF, signed by both the auditor and insured upon

completion of the Audit. A selected Offeror shall supply a copy of the Audit report to the

insured, if requested. A selected Offeror shall make three (3) attempts to conduct the Audit

before the audit control sheet is returned to SWIF. Forms reflected Audits that cannot be

conducted must be marked “NOT ABLE TO COMPLETE” and describe the reason the Audit

could not be completed. A selected Offeror must document that it made two (2) verbal attempts

and one (1) written request, sent via certified mail, return receipt requested to schedule the Audit.

This documentation must be attached to the returned Audit form. SWIF will not pay for an

incomplete Audit without this documentation. Describe your process for meeting this

requirement.

IV. 13. Audit Reports. All reports of Audits and Underwriting Visits must be signed by the

insured, or their representative, in order for an Offeror to be paid. If a report cannot be signed, a

detailed explanation is required.

The Audit report must include a comprehensive narrative of the policyholder’s business

operations. This narrative must be in accordance with commonly accepted standards of the

industry, including the guidelines established by The Pennsylvania Compensation Rating Bureau

and The Coal Mine Compensation Rating Bureau. The narrative must accurately explain the

policyholder’s business. For policyholders with 50 employees or less, the Audit must include the

29

names, positions, and payroll for each employee. Describe your process for meeting this

requirement.

The audit report must include a description of the duties performed by each corporate officer,

sole proprietor or partner. If the auditor is tentative as to how to properly classify a worker, who

performs various types of work, the PCRB manual addresses the issues of regular and frequent

under the General Auditing Classification Section.

The auditor must possess knowledge pertaining to exposures involving restaurants and tip

calculations, The Davis Bacon Act relating to prevailing wage operations, United States

Longshoremen and Harbor (USL & H) and Jones Act coverage and Owner Controlled Insurance

Program (OCIP) Projects.

IV. 14. Re-Audits. If the Audit findings are challenged by the policyholder, an a Re-Audit is

necessary, SWIF will pay the selected Offeror for the Re-Audit only if the original information

from the policyholder was incorrect or a policy change necessitated the Re-Audit. SWIF will not

pay for Re-Audits if the selected Offeror failed to initially secure the proper and correct Audit

information.

IV. 15. Audit Citations. If any Test Audit Citations are issued by the PCRB, the selected

Offeror must return to the Audit location and respond to the Test Audit Citation within a 45 day

period. The selected Offeror shall receive no additional compensation for this. However, if the

PCRB’s Citation is rescinded based on the Re-Audit, SWIF will pay the selected Offeror its

regular Audit charge. If SWIF is fined because of a Test Audit, the selected Offeror will be

required to reimburse SWIF for the fine. Describe your process for handing audit citations.

IV. 16. Reports and Project Control. SWIF has designed a Quality Control Program to

measure the job performance of each of its selected Offerors. It reviews the performance of its

Offerors on a quarterly basis, at SWIF’s Home Office in Scranton. Selected Offerors are

required to attend these quarterly performance reviews. SWIF may terminate a contract or

redistribute work if it determines that a selected Offeror’s performance is unsatisfactory.

Additional meetings may be required, at SWIF’s discretion. Describe your procedure for reports

and project control.

IV-17. Service Level Agreements. A successful Offeror will be able to meet the following

service level requirements, which have been designed to insure that Audits, with affect the policy

premiums charged by SWIF, are completed on time and without error. If a selected Offeror

consistently fails to meet these standards, SWIF, in its sole discretion, may terminate its contract

with that selected Offeror. In its proposal, an Offeror must:

IV-17.1. Total Audits. Describe the measures that it will put in place to insure

that the error ratio on total Audits does not exceed 2%.

IV-17-2. Test Audits. Describe the measure that it will put in place to insure

that the error ratio on Test Audits does not exceed 20%.

30

IV-17-3. Incomplete Audits. Describe the measure that it will put into

place to insure that the number of Incomplete

Audits does not exceed 7% of the total number of Audits

assigned to the Offeror.

IV-17-4. Late Audits. Describe the measure that it will put into place to

insure the following:

a) That the number of Audit reports filed with SWIF

beyond 45 business days after the expiration of the

policy does not exceed 7% of the total number of

Audits assigned to the Offeror.

b) That the number of Audit reports filed with SWIF

beyond 90 business days after the

expiration of the policy does not exceed

3% of the total number of Audits assigned

to the Offeror.

IV-17.5. Total Premiums Describe the measures that it will put in

Generated place to insure that the following goals are met:

a) That total premiums generated on all

Audits will met the goal of 6% over the

aggregate or original estimated policy

premium.

b) That total premiums generated on Audits under

$10,000.00 in premium will meet the goals of 10%

over the aggregate of original estimated policy

premium.

IV. 18. Contract Requirements: Disadvantaged Business Participation and Enterprise Zone

Small Business Participation.

All contracts containing Disadvantaged Business participation and/or Enterprise Zone

Small Business participation must also include a provision requiring the selected

contractor to meet and maintain those commitments made to Disadvantaged Businesses

and/or Enterprise Zone Small Businesses at the time of proposal submittal or contract

negotiation, unless a change in the commitment is approved by the BMWBO. All contracts

containing Disadvantaged Business participation and/or Enterprise Zone Small Business

participation must include a provision requiring Small Disadvantaged Business

subcontractors, Enterprise Zone Small Business subcontractors and Small Disadvantaged

Businesses or Enterprise Zone Small Businesses in a joint venture to perform at least 50%

31

of the subcontract or Small Disadvantaged Business/Enterprise Zone Small Business

participation portion of the joint venture.

The selected contractor’s commitments to Disadvantaged Businesses and/or Enterprise Zone

Small Businesses made at the time of proposal submittal or contract negotiation shall be

maintained throughout the term of the contract and through any renewal or extension of the

contract. Any proposed change must be submitted to BMWBO, which will make a

recommendation to the Contracting Officer regarding a course of action.

If a contract is assigned to another contractor, the new contractor must maintain the

Disadvantaged Business participation and/or Enterprise Zone Small Business participation of the

original contract.

The selected contractor shall complete the Prime Contractor’s Quarterly Utilization Report (or

similar type document containing the same information) and submit it to the contracting officer

of the Issuing Office and BMWBO within 10 workdays at the end of each quarter the contract is

in force. This information will be used to determine the actual dollar amount paid to Small

Disadvantaged Business and/or Enterprise Zone Small Business subcontractors and suppliers,

and Small Disadvantaged Business and/or Enterprise Zone Small Business participants involved

in joint ventures. Also, this information will serve as a record of fulfillment of the commitment

the selected contractor made and for which it received Disadvantaged Business and Enterprise

Zone Small Business points. If there was no activity during the quarter then the form must be

completed by stating “No activity in this quarter.”

NOTE: EQUAL EMPLOYMENT OPPORTUNITY AND CONTRACT COMPLIANCE

STATEMENTS REFERRING TO COMPANY EQUAL EMPLOYMENT

OPPORTUNITY POLICIES OR PAST CONTRACT COMPLIANCE PRACTICES DO

NOT CONSTITUTE PROOF OF DISADVANTAGED BUSINESSES STATUS OR

ENTITLE AN OFFEROR TO RECEIVE CREDIT FOR DISADVANTAGED

BUSINESSES UTILIZATION.

32

APPENDIX A

STANDARD TERMS AND CONDITIONS

STANDARD CONTRACT TERMS AND CONDITIONS

STD-274 Rev. 05/07/04

http://www.dgs.state.pa.us/dgs/lib/dgs/forms/comod/procurementforms/std274 sap.d

33

APPENDIX B

DOMESTIC WORKFORCE UTILIZATION CERTIFICATION

To the extent permitted by the laws and treaties of the United States, each proposal will be

scored for its commitment to use the domestic workforce in the fulfillment of the contract.

Maximum consideration will be given to those offerors who will perform the contracted direct

labor exclusively within the geographical boundaries of the United States or within the

geographical boundaries of a country that is a party to the World Trade Organization

Government Procurement Agreement. Those who propose to perform a portion of the direct

labor outside of the United States and not within the geographical boundaries of a party to the

World Trade Organization Government Procurement Agreement will receive a correspondingly

smaller score for this criterion. In order to be eligible for any consideration for this criterion,

offerors must complete and sign the following certification. This certification will be included as

a contractual obligation when the contract is executed. Failure to complete and sign this

certification will result in no consideration being given to the offeror for this criterion.

I, ______________________[title] of ____________________________________[name of

Contractor] a _______________ [place of incorporation] corporation or other legal entity,

(“Contractor”) located at

__________________________________________________________

[address], having a Social Security or Federal Identification Number of

________________________, do hereby certify and represent to the Commonwealth of

Pennsylvania ("Commonwealth") (Check one of the boxes below):

All of the direct labor performed within the scope of services under the contract will be

performed exclusively within the geographical boundaries of the United States or one of the

following countries that is a party to the World Trade Organization Government Procurement

Agreement: Aruba, Austria, Belgium, Bulgaria, Canada, Chinese Taipei, Cyprus, Czech

Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland,

Ireland, Israel, Italy, Japan, Korea, Latvia, Liechtenstein, Lithuania, Luxemburg, Malta, the

Netherlands, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain,

Sweden, Switzerland, and the United Kingdom

OR

________________ percent (_____%) [Contractor must specify the percentage] of the direct

labor performed within the scope of services under the contract will be performed within the

geographical boundaries of the United States or within the geographical boundaries of one of the

countries listed above that is a party to the World Trade Organization Government Procurement

Agreement. Please identify the direct labor performed under the contract that will be performed

outside the United States and not within the geographical boundaries of a party to the World

Trade Organization Government Procurement Agreement and identify the country where the

direct labor will be performed:

______________________________________________________________________________

__________________________________________________________________

34

________________________________________________________________________

[Use additional sheets if necessary]

The Department of General Services [or other purchasing agency] shall treat any misstatement as

fraudulent concealment of the true facts punishable under Section 4904 of the Pennsylvania

Crimes Code, Title 18, of Pa. Consolidated Statutes.

Attest or Witness: ______________________________

Corporate or Legal Entity's Name

_____________________________ ______________________________

Signature/Date Signature/Date

_____________________________ ______________________________

Printed Name/Title Printed Name/Title

35

APPENDIX C

TERRITORY ASSIGNMENT (By-County)

TERRITORY A:

Counties: Bucks-Chester-Delaware-Montgomery-Philadelphia

TERRITORY B:

Counties: Adams- Berks-Bradford-Carbon-Centre-Clinton-Columbia-

Cumberland-Dauphin-Franklin-Juniata-Lackawanna-Lancaster-Lebanon-

Luzerne-Lycoming-Mifflin-Monroe-Montour-Northampton-Northumberland-

Perry-Pike-Potter-Schuylkill-Snyder-Sullivan-Susquehanna-Tioga-Union-

Wayne-Wyoming-York

TERRITORY C:

Counties: Allegheny-Armstrong-Beaver-Butler-Bedford-Blair-Cameron-

Crawford-Cambria-Clearfield-Clarion-Elk-Erie-Fayette-Forest-Fulton-

Greene-Huntingdon-Indiana-Jefferson-Lawrence-Mercer-McKean-Somerset-

Venango-Warren-Washington-Westmoreland

TERRITORY D: OUT-OF-STATE

TERRITORY E: STATEWIDE (Includes Territory A,B & C)

Proposals should only be submitted for territories which an Offeror can effectively service. For

instance, if an Offeror’s business is concentrated in one territory, a proposal should be submitted

only for that territory. An Offeror will be graded on its ability to perform the necessary services

within that territory. If an Offeror submits a proposal for all territories, it will be graded on its

ability to service all geographic territories. A separate proposal is required for each territory

which the Offeror wishes to service.

36

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #0 - OUT-OF-STATE

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 206 206 15 15 66,870 66,870 0 1

501-1000 257 463 19 33 188,101 254,971 2 2

1001-1500 161 624 12 45 198,037 453,008 2 4

1501-2000 103 727 7 52 176,961 629,969 1 5

2001-3000 106 833 8 60 256,569 886,538 2 7

3001-5000 116 949 8 68 449,389 1,335,927 4 11

5001-7500 108 1057 8 76 661,375 1,997,302 5 16

7501-10000 67 1124 5 81 576,758 2,574,060 5 21

10001-20000 123 1247 9 90 1,727,610 4,301,670 14 36

20001-30000 48 1295 3 93 1,188,193 5,489,863 10 45

30001-40000 26 1321 2 95 906,897 6,396,760 7 53

40001-50000 15 1336 1 96 668,847 7,065,607 6 58

50001-75000 23 1359 2 98 1,451,954 8,517,561 12 70

75001-100000 15 1374 1 99 1,264,069 9,781,630 10 81

100001-200000 10 1384 1 100 1,506,836 11,288,466 12 93

200001-500000 3 1387 0 100 827,161 12,115,627 7 100

District Totals 1387 1387 100 12,115,627 12,115,627 100

37

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #1 - PHILADELPHIA

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 1493 1493 21 21 455,919 455,919 1 1

501-1000 1135 2628 16 37 845,636 1,301,555 2 3

1001-1500 727 3355 10 47 877,884 2,179,439 2 5

1501-2000 536 3891 8 55 926,692 3,106,131 2 8

2001-3000 772 4663 11 65 1,903,095 5,009,226 5 13

3001-5000 850 5513 12 77 3,281,200 8,290,426 8 21

5001-7500 549 6062 8 85 3,374,078 11,664,504 8 29

7501-10000 257 6319 4 89 2,208,003 13,872,507 6 35

10001-20000 413 6732 6 95 5,802,990 19,675,497 15 49

20001-30000 155 6887 2 97 3,795,141 23,470,638 9 59

30001-40000 74 6971 1 98 2,536,127 26,006,785 6 65

40001-50000 48 7009 1 98 2,177,590 28,184,355 5 71

50001-75000 47 7056 1 99 2,881,270 31,065,625 7 78

75001-100000 27 7083 0 99 2,378,547 33,444,172 6 84

100001-200000 31 7114 0 100 4,396,174 37,840,346 11 95

200001-500000 6 7120 0 100 1,615,558 39,455,904 4 99

500001-1000000 1 7121 0 100 521,342 39,977,246 1 100

District Totals 7121 7121 0 100 39,977,246 39,977,246 100

38

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #2 - HARRISBURG

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 510 510 22 22 151,064 151,064 1 1

501-1000 469 979 20 41 351,794 502,858 3 4

1001-1500 278 1257 12 53 344,096 846,954 3 7

1501-2000 167 1424 7 60 290,294 1,137,248 3 10

2001-3000 228 1652 10 70 546,065 1,683,313 5 15

3001-5000 231 1883 10 80 897,102 2,580,415 8 23

5001-7500 146 2029 6 86 903,865 3484,280 8 31

7501-10000 92 2121 4 90 794,827 4,279,107 7 37

10001-20000 127 2248 5 95 1,782,176 6,061,283 16 53

20001-30000 56 2304 2 97 1,362,565 7,423,848 12 65

30001-40000 21 2325 1 98 717,590 8,141,438 6 71

40001-50000 8 2333 0 99 357,736 8,499,174 3 74

50001-75000 16 2349 1 99 932,814 9,431,988 8 83

75001-100000 9 2358 0 100 782,527 10,214,515 7 89

100001-200000 6 2364 0 100 714,778 10,929,293 6 96

200001-500000 2 2366 0 100 489881 11,419,174 4 100

District Totals 2366 2366 100 11,419,174 11,419,174 100

39

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #3 - POTTSVILLE

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 492 492 19 19 144,751 144,751 0 1

501-1000 428 920 17 36 321,340 466,091 2 3

1001-1500 253 1173 10 46 311,893 777,984 2 5

1501-2000 220 1393 9 55 378,563 1,156,547 2 7

2001-3000 242 1635 9 64 598,977 1,755,524 4 11

3001-5000 296 1931 12 76 1,124,749 2,880,273 7 17

5001-7500 186 2117 7 83 1,135,071 4,015,344 7 24

7501-10000 114 2231 4 87 1,005,349 5,020,693 6 30

10001-20000 158 2389 6 94 2,135,065 7,155,758 13 43

20001-30000 60 2449 2 96 1,444,909 8,600,667 9 52

30001-40000 29 2478 1 97 1,021,872 9,622,539 6 58

40001-50000 13 2491 1 98 596,228 10,218,767 4 61

50001-75000 33 2524 1 99 2,078,559 12,297,326 13 74

75001-100000 10 2534 0 99 873,280 13,170,606 5 79

100001-200000 13 2547 1 100 1,709,083 14,879,689 10 90

200001-500000 3 2550 0 100 1,135,668 16,015,357 7 96

5005001-1000000 1 2551 0 100 608,562 16,623,919 4 100

District Totals 2551 2551 100 16,623,919 16,623,919 100

40

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #4 - SUNBURY

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 309 309 24 24 96,768 96,768 1 1

501-1000 198 507 15 39 144,529 241,297 2 4

1001-1500 149 656 12 51 180,953 422,250 3 6

1501-2000 87 743 7 58 151,477 573,727 2 8

2001-3000 122 865 9 67 298,294 872,021 4 13

3001-5000 143 1008 11 78 544,334 1,416,355 8 21

5001-7500 92 1100 7 85 563,260 1,979,615 8 29

7501-10000 45 1145 3 89 385,043 2,364,658 6 35

10001-20000 79 1224 6 95 1,090,850 3,455,508 16 51

20001-30000 34 1258 3 97 817,659 4,273,167 12 63

30001-40000 9 1267 1 98 318,675 4,591,842 5 68

40001-50000 7 1274 1 99 320,945 4,912,787 5 72

50001-75000 7 1281 1 99 413,539 5,326,326 6 79

75001-100000 5 1286 0 100 438,307 5,764,633 6 85

100001-200000 3 1289 0 100 362,910 6,127,543 5 90

200001-500000 2 1291 0 100 648,956 6,776,499 10 100

District Totals 1291 1291 100 6,776,499 6,776,499 100

41

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #5 - PITTSBURGH

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 1289 1289 25 25 405,129 405,129 2 2

501-1000 914 2203 18 42 676,642 1,081,771 3 4

1001-1500 524 2727 10 53 643,688 1,725,459 2 6

1501-2000 417 3144 8 61 725,717 2,451,176 3 9

2001-3000 470 3614 9 70 1,149,718 3,600,894 4 13

3001-5000 506 4120 10 79 1,965,816 5,566,710 7 21

5001-7500 338 4458 7 86 2,050,631 7,617,341 8 29

7501-10000 172 4630 3 89 1,465,654 9,082,995 5 34

10001-20000 284 4914 5 95 3,944,493 13,027,488 15 49

20001-30000 102 5016 2 97 2,521,561 15,549,049 9 58

30001-40000 57 5073 1 98 1,987,426 17,536,475 7 66

40001-50000 38 5111 1 99 1,720,021 19,256,496 6 72

50001-75000 31 5142 1 99 1,901,315 21,157,811 7 79

75001-100000 21 5163 0 100 1,841,189 22,999,000 7 86

100001-200000 23 5186 0 100 3,068,032 26,067,032 11 98

200001-500000 25 5188 0 100 658,766 26,725,798 2 100

District Totals 5188 5188 100 26,725,798 26,725,798 100

42

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #6 - SCRANTON

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 405 405 20 20 116,544 116,544 0 1

501-1000 339 744 17 38 248,172 364,716 2 3

1001-1500 191 935 10 47 239,665 604,381 2 4

1501-2000 167 1102 8 56 289,300 893,681 2 7

2001-3000 181 1283 9 65 436,292 1,329,973 3 10

3001-5000 225 1508 11 76 857,414 2,187,387 6 16

5001-7500 137 1645 7 83 834,510 3,021,897 6 22

7501-10000 93 1738 5 88 810,801 3,832,698 6 28

10001-20000 129 1867 7 94 1,821,295 5,653,993 14 42

20001-30000 41 1908 2 96 1,016,535 6,670,528 8 49

30001-40000 17 1925 1 97 580,422 7,250,950 4 54

40001-50000 8 1933 0 97 348,874 7,599,824 3 56

50001-75000 17 1950 1 98 1,013,143 8,612,967 8 64

75001-100000 15 1965 1 99 1,342,148 9,955,115 10 74

100001-200000 12 1977 1 100 1,630,103 11,585,218 12 86

200001-500000 5 1982 0 100 1,315,591 12,900,809 10 96

500001-1000000 1 1983 0 100 588,602 13,489,411 4 100

District Totals 1983 1983 100 13,489,411 13,489,411 100

43

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #7 - ERIE

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 284 284 26 26 96,922 96,922 2 2

501-1000 191 475 17 43 139,621 236,543 3 5

1001-1500 102 577 9 52 127,579 364,122 3 7

1501-2000 72 649 6 58 124,157 488,279 2 10

2001-3000 103 752 9 68 258,572 746,851 5 15

3001-5000 119 871 11 78 456,828 1,203,679 9 24

5001-7500 78 949 7 85 479,505 1,683,184 10 33

7501-10000 46 995 4 90 401,012 2,084,196 8 41

10001-20000 78 1073 7 97 1,121,680 3,205,876 22 64

20001-30000 12 1085 1 98 305,517 3,511,393 6 70

30001-40000 11 1096 1 99 376,987 3,888,380 7 77

40001-50000 4 1100 0 99 173,642 4,062,022 3 81

50001-75000 5 1105 0 99 295,277 4,357,299 6 87

75001-100000 3 1108 0 100 260,683 4,617,982 5 92

100001-200000 3 1111 0 100 414,220 5,032,202 8 100

District Totals 1111 1111 100 5,032,202 5,032,202 100

44

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

DISTRICT #9 - JOHNSTOWN

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 415 415 21 21 126,108 126,108 1 1

501-1000 389 804 20 41 285,179 411,287 3 4

1001-1500 220 1024 11 52 271,643 682,930 3 7

1501-2000 147 1171 7 59 255,739 938,669 3 10

2001-3000 203 1374 10 69 495,695 1,434,364 5 16

3001-5000 212 1586 11 80 812,042 2,246,406 9 24

5001-7500 142 1728 7 87 869,071 3,115,477 9 34

7501-10000 61 1789 3 90 523,992 3,639,469 6 40

10001-20000 112 1901 6 96 1,594,769 5,234,238 17 57

20001-30000 39 1940 2 98 956,907 6,191,145 10 67

30001-40000 14 1954 1 99 486,185 6,677,330 5 73

40001-50000 8 1962 0 99 355,988 7,033,318 4 77

50001-75000 11 1973 1 100 651,345 7,684,663 7 84

75001-100000 3 1976 0 100 269,416 7,954,079 3 87

100001-200000 3 1979 0 100 379,536 8,333,615 4 91

200001-500000 3 1982 0 100 854,590 9,188,205 9 100

District Totals 1982 1982 100 9,188,205 9,188,205 100

45

APPENDIX D

DISTRICT OFFICE POLICY BREAKDOWN

POLICIES IN FORCE AS OF 03/30/2012

SUMMARY OF ALL DISTRICTS

Premium

Group

Policy

Count

Policy

Count

Cumm

Policy

%

Policy

%

Cumm

Premium

Amount

Whole $

Premium

Amount

Cumm

Amt.

%

Prem.

%

Cumm

0-500 5426 5426 22 22 1,658,519 1,658,519 1 1

501-1000 4318 9744 17 39 3,199,766 4,858,285 2 3

1001-1500 2605 12349 10 49 3,195,546 8,053,831 2 6

1501-2000 1915 14264 8 57 3,317,282 11,371,113 2 8

2001-3000 2421 16685 10 67 5,927,674 17,298,787 4 12

3001-5000 2691 19376 11 78 10,361,742 27,660,529 7 20

5001-7500 1776 21152 7 85 10,871,572 38,532,101 8 27

7501-10000 947 22099 7 88 8,169,520 46,701,621 6 33

10001-20000 1501 23600 6 94 20,988,795 67,690,416 15 48

20001-30000 543 24143 2 97 13,304,868 80,995,284 9 57

30001-40000 257 24400 1 98 8,898,733 89,894,017 6 64

40001-50000 149 24549 1 98 6,719,871 96,613,888 5 68

50001-75000 190 24739 1 99 11,618,208 108,232,096 8 77

75001-100000 108 24847 0 99 9,450,166 117,682,262 7 83

100001-200000 104 24951 0 100 14,181,672 131,863,934 10 93

200001-500000 26 24977 0 100 7,546,171 139,410,105 5 99

500001-1000000 3 24980 0 100 1,718,506 141,128,611 1 100

46

APPENDIX E-1

COST SUBMITTAL FORM FOR TERRITORY A

Instructions to Offerors:

1. PLEASE PROVIDE A COST FOR EACH OF THE LISTED SERVICES.

2. YOU MUST COMPLETE SEPARATE COST INFORMATION FOR EACH

GEOGRAPHIC TERRITORY IN WHICH YOU PROPOSE TO PROVIDE

SERVICES.

TERRITORY A

1. Total Cost Per Completed Audit $

2. Cost Per Incomplete Audit $

3. Cost Per Additional Location $

4. Cost Per Hour for Large Audits $

47

APPENDIX E-2

COST SUBMITTAL FORM FOR TERRITORY B

Instructions to Offerors:

1. PLEASE PROVIDE A COST FOR EACH OF THE LISTED SERVICES.

2. YOU MUST COMPLETE SEPARATE COST INFORMATION FOR EACH

GEOGRAPHIC TERRITORY IN WHICH YOU PROPOSE TO PROVIDE

SERVICES.

TERRITORY B

1. Total Cost Per Completed Audit $

2. Cost Per Incomplete Audit $

3. Cost Per Additional Location $

4. Cost Per Hour for Large Audits $

48

APPENDIX E-3

COST SUBMITTAL FORM FOR TERRITORY C

Instructions to Offerors:

1. PLEASE PROVIDE A COST FOR EACH OF THE LISTED SERVICES.

2. YOU MUST COMPLETE SEPARATE COST INFORMATION FOR EACH

GEOGRAPHIC TERRITORY IN WHICH YOU PROPOSE TO PROVIDE

SERVICES.

TERRITORY C

1. Total Cost Per Completed Audit $

2. Cost Per Incomplete Audit $

3. Cost Per Additional Location $

4. Cost Per Hour for Large Audits $

49

APPENDIX E-4

COST SUBMITTAL FORM FOR TERRITORY D

Instructions to Offerors:

1. PLEASE PROVIDE A COST FOR EACH OF THE LISTED SERVICES

.

2. YOU MUST COMPLETE SEPARATE COST INFORMATION FOR EACH

GEOGRAPHIC TERRITORY IN WHICH YOU PROPOSE TO PROVIDE

SERVICES.

TERRITORY D – Out-of State

1. Total Cost Per Completed Audit $

2. Cost Per Incomplete Audit $

3. Cost Per Additional Location $

4. Cost Per Hour for Large Audits $

50

APPENDIX E-5

COST SUBMITTAL FORM FOR TERRITORY E

Instructions to Offerors:

1. PLEASE PROVIDE A COST FOR EACH OF THE LISTED SERVICES

.

2. YOU MUST COMPLETE SEPARATE COST INFORMATION FOR EACH

GEOGRAPHIC TERRITORY IN WHICH YOU PROPOSE TO PROVIDE

SERVICES.

TERRITORY E – Statewide

1. Total Cost Per Completed Audit $

2. Cost Per Incomplete Audit $

3. Cost Per Additional Location $

4. Cost Per Hour for Large Audits $

Note: Territory E includes territories A,B and C.

51

APPENDIX F

CONTRACTOR QUALITY COMPARISON

During the term of the contract, selected Offerors will be evaluated on the following

factors:

■ Total Premium Audit Results

■ Small Account Premium Audit Results

■ In-House Quality Review

■ Test Audit Results

■ Incomplete Audits

■ Late Audits

■ Audits over 90 days late

Each Selected Offeror will be ranked according to its performance, on a scale of 1-5, with

1 being the best and 5 being the worst. The average results for each Offeror will be computed

for all of the criteria and a final ranking determined. An Offeror will be provided with the results

of the review performed for it. SWIF may revise its quality review standards. Offerors will be

notified about any revisions.

52

APPENDIX F-1

AUDIT QUALITY REVIEW STANDARDS

In terms of percentages, the following applies:

Total Audits (Maximum error ratio allowed 2%)

Test Audits (Maximum error ratio allowed 20%)

Incomplete Audits (Maximum allowance 7%)

Late Audits (Maximum allowance 7%)

Audits over 90 Days

Late (Maximum allowance 3%)

Total Premiums Generated

on All Premium Audits (6% - Current SWIF Goal)

Total Premiums Generated

on Small Account Audits (10% - Current SWIF Goal)

(Audits under $10,000

in premium)

These Standards will be applied to evaluate selected Offeror’s performance during the term of

the contract.

53

APPENDIX H

AUDITORS PER GEOGRAPHIC TERRITORY

Offerors must provide the number of auditors who will be assigned to each Geographic Territory

in which the Offeror proposes to provide services.

Proposed Number of Auditors

Territory A

Territory B

Territory C

Territory D

Territory E

54

APPENDIX I - PROPOSAL COVER SHEET

COMMONWEALTH OF PENNSYLVANIA

STATE WORKERS’ INSURANCE FUND

RFP# SWIF 01-2012

Enclosed in three separately sealed submittals is the proposal of the Offeror identified

below for the above-referenced RFP:

Offeror Information:

Offeror Name

Offeror Mailing Address

Offeror Website

Offeror Contact Person

Contact Person’s Phone Number

Contact Person’s Facsimile

Number

Contact Person’s E-Mail Address

Offeror Federal ID Number

Offeror SAP/SRM Vendor

Number

Submittals Enclosed and Separately Sealed:

Technical Submittal

Disadvantaged Business Submittal

Cost Submittal

Signature

Signature of an official

authorized to bind the

Offeror to the provisions

contained in the

Offeror’s proposal:

Printed Name

Title

55

FAILURE TO COMPLETE, SIGN AND RETURN THIS FORM WITH THE

OFFEROR’S PROPOSAL MAY RESULT IN THE REJECTION OF THE OFFEROR’S

PROPOSAL

56

APPENDIX J, RIGHT TO KNOW (RTKL)