Exhibit 10. LL

Confidential Treatment Requested - Confidential portions of this document

have been redacted and have been separately filed with the Commission.

 

AMENDMENT OF  SOLICITATION/MODIFICATION OF CONTRACT   1. Contract ID Code   

Page

1

 

of Pages

15

2. Amendment/Modification No.

P00814

 

3. Effective Date

1/16/2011

  4. Requisition/Purchase Req. No.  

5. Project No. (if applicable)

15223

6. Issued By                 Code MDA906                      

DEPARTMENT OF DEFENSE

TRICARE MANAGEMENT ACTIVITY/CM

16401 E. CENTRETECH PARKWAY

AURORA, CO 80011-9066

 

7. Administered By (if other than Item 6)             Code                    

DEPARTMENT OF DEFENSE

TRICARE MANAGEMENT ACTIVITY/CM

16401 E. CENTRETECH PARKWAY

AURORA, CO 80011-9066

 

8. Name and Address of Contractor (No., Street, County, and Zip Code)

 

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Attn: DAVID J. BAKER

500 W. MAIN STREET

P.O. BOX 740062

LOUISVILLE KY 40202

  (x)   9A. Amendment of Solicitation No.       9B. Date (See Item 11)   X  
10A. Modification of Contract/Order No.

MDA906-03-C-0010

    10B. Date (See Item 13)

08/27/3002

Code 805349198

  Facility Code        

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

[    ] The above numbered solicitation is amended as set forth in item 14. The
hour and date specified for receipt of Offers [    ] is extended [    ] is not
extended. Offers must acknowledge receipt of this amendment prior to the hour
and date specified in the solicitation or as amended, by one of the following
methods: (a) By completing items 8 and 15, and returning          copies of the
amendment; (b) By acknowledging receipt of this amendment on each copy of the
offer submitted; or (c) By separate letter or telegram which includes a
reference to the solicitation and amendment numbers. FAILURE OF YOUR
ACKNOWLEDG-MENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS
PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If
by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter
makes reference to the solicitation and this amendment, and is received prior to
the opening hour and date specified.

12. Accounting and Appropriation Data (if required)

See Schedule

     13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACT/ORDERS. IT MODIFIES
THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.     A. This change order is
issued pursuant to: (Specify authority) The changes set forth in item 14 are
made in the Contract Order No. in item 10A.     B. The above numbered
Contract/Order is modified to reflect the administrative changes (such as
changes in paying office, appropriation date, etc) Set forth item 14, pursuant
to the authority of FAR 43.103(b)

X

 

C. This supplemental agreement is entered into pursuant to authority of:

10 U.S.C. 2304(c)(1) and DFARS 271.7404-1(a)

    D. Other (Specify type of modification and authority)

E. IMPORTANT: Contractor [    ] is not, [ X ] is required to sign this document
and return 1 copies to the issuing office.

14. Description of Amendment/Modification (Organized by UCF section headings,
including solicitation/contract subject matter where feasible.)

 

A. The purpose of this supplemental agreement is to execute an Undefinitzed
Contract Action (UCA) to add one unexercised 12 month Option Period (OP), hereto
referred to as OP IX, to the TRICARE South Region Managed Care Support Contract.
The performance period of OP IX shall be April 1, 2011 through March 31, 2012.
The estimated quantities and dollar amounts are shown beginning at Page 2 of
this modification. Underwritten Target Health Care Cost and Underwritten Health
Care Target Fee CLIN 0908 will be negotiated separately in accordance with
contract Section H.1.

 

Continued...

 

Except as provided herein, all terms and conditions of the document referenced
in item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.

 

15A. Name and Title of Signer (Type or Print)

DAVID J. BAKER

PRESIDENT & CEO, HUMANA MILITARY

 

16A. Name and title of Contracting Officer (Type or Print)

 

CHARLES R. BROWN

15B. Contractor/Offeror

 

/s/David J. Baker

 

(Signature of person authorized to sign)

  15C. Date Signed

01-6-11

 

16B. United States of America

 

/s/ Charles R. Brown

 

(Signature of Contracting Officer)

  16C. Date Signed

 

1/6/2011

NSN 7540-01-152-8070 

PREVIOUS EDITIONS UNUSABLE

 

STANDARD FORM 30 (REV. 10-83)

Prescribed by GSA

FAR (48 CFR) 53.243

--------------------------------------------------------------------------------

CONTINUATION SHEET                  

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

       

Page  

2

  

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

     Add Item 0901 as follows:                       0901    Claims Processing
(See CLINS 0913 and 0914)                            Add Item 0902 as follows:
                      0902    Per Member Per Month                           
Add Item 0902AA as follows:                       0902AA    

MHS Eligible Per Member Per Month (First 6 Months)

(NTE)

Incrementally Funded Amount: $0.00

   ****       ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0902AB as follows:                      
0902AB    

MHS Eligible Per Member Per Month (Second 6 months)

(NTE)

Incrementally Funded Amount: $0.00

   ****       ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0902AC as follows:                      
0902AC    

TRS Enrolled Per Member Per Month (First 6 months)

(NTE)

Incrementally Funded Amount: $0.00

   ****       ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0902AD as follows:                      
0902AD    

TRS Enrolled Per Member Per Month (Second 6 months)

Continued…

   ****       ****     ****

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

CONTINUATION SHEET                  

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

        Page  
3   

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

  

(NTE)

Incrementally Funded Amount: $0.00

                        

Accounting Info:

$USD 0.00

Funded: $0.00

                         Add Item 0903 as follows:                      

0903

   Disease Management                          Add Item 0903AA as follows:     
                

0903AA 

  

Disease Management

FY11 (NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****     ****           

Accounting Info:

$USD 0.00

Funded: $0.00

                         Add Item 0903AB as follows:                      

0903AB 

  

Disease Management

FY12 (NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****     ****           

Accounting Info:

$USD 0.00

Funded: $0.00

                         Add Item 0903AC as follows:                      

0903AC 

  

Disease Management

4% Fixed Fee FY11

(NTE)

Incrementally Funded Amount: $0.00

   6    MO    ****     ****           

Accounting Info:

$USD 0.00

Funded: $0.00

                         Add Item 0902AD as follows:                      

0903AD 

  

Disease Management

Continued…

   6    MO    ****     ****

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

CONTINUATION SHEET                   

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

        Page  
4   

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

    

4% Fixed Fee FY12

(NTE)

Incrementally Funded Amount: $0.00

                            

Accounting Info:

$USD 0.00

Funded: $0.00

                             Add Item 0904 as follows:                        

0904

   Customer Satisfaction Award Fee Pool                              Add Item
0904AA as follows:                        

0904AA 

  

First Quarter (NTE)

Incrementally Funded Amount: $0.00

   1    EA    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                             Add Item 0904AB as follows:                        

0904AB 

  

Second Quarter (NTE)

Incrementally Funded Amount: $0.00

   1    EA    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                             Add Item 0904AC as follows:                        

0904AC 

  

Third Quarter (NTE)

Incrementally Funded Amount: $0.00

   1    EA    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                             Add Item 0904AD as follows:                        

0904AD 

  

Fourth Quarter (NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****     ****              Continued…                            
  

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

CONTINUATION SHEET                  

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

        Page  
5   

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

    

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0906 as follows:                       0906
  

Transition Out (NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0907 as follows:                       0907
  

TRICARE Service Centers

FY11 (NTE)

Incrementally Funded Amount: $0.00

   6    MO    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0907AB as follows:                      
0907AB    

TRICARE Service Centers

FY12 (NTE)

Incrementally Funded Amount: $0.00

   6    MO    ****     ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0908 as follows:                       0908
   Underwritten Health Care Cost                            Add Item 0908AE as
follows:                       0908AE     Underwriting Target Fee    1    LT   
****     ****              Continued…              

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

CONTINUATION SHEET                  

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

        Page  
6   

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

    

April 1, 2011 through September 30, 2011

(NTE)

Obligated Amount: $0.00

                          

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0908AF as follows:                      
0908AF    

Underwritten Health Care Target Cost

April 1, 2011 through September 30, 2011

(NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0908AG as follows:                      
0908AG    

Underwriting Target Fee

October 1, 2011 through March 31, 2012

(NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0908AH as follows:                      
0908AH    

Underwritten Health Care Target Cost

October 1, 2010 through March 31, 2012

(NTE)

Incrementally Funded Amount: $0.00

   1    LT    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0913 as follows:                       0913
  

Electronic Claims

(estimated quantity)

Continued…

             

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

CONTINUATION SHEET                  

REFERENCE NO. OF DOCUMENT BEING CONTINUED

MDA906-03-C-0010/P00814

        Page  
7   

Of            

15

NAME OF OFFEROR OR CONTRACTOR

HUMANA MILITARY HEALTHCARE SERVICES, INC.

Item No.

(A)

  

Supplies/Services

(B)

  

Quantity

(C)

  

Unit  

(D)  

  

UNIT PRICE  

(E)  

  

AMOUNT

(F)

     Add Item 0913AA as follows:                       0913AA    

Electronic Claims

FY11 (NTE)

Incrementally Funded Amount: $0.00

   ****    EA    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0913AB as follows:                      
0913AB    

Electronic Claims

FY12 (NTE)

Incrementally Funded Amount: $0.00

   ****    EA    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0914 as follows:                       0914
  

Paper Claims

(estimated quantity)

                           Add Item 0914AA as follows:                      
0914AA    

Paper Claims

FY11 (NTE)

Incrementally Funded Amount: $0.00

(estimated quantity)

   ****    EA    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

                           Add Item 0914AB as follows:                      
0914AB    

Paper Claims

FY12 (NTE)

Incrementally Funded Amount: $0.00

   ****    EA    ****    ****             

Accounting Info:

$USD 0.00

Funded: $0.00

             

OPTIONAL FORM 336 (4-86)

Sponsored by GSA

FAR (48 CFR) 53.110

NSN 7540-01-152-80667

 

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

B. The contractor will be reimbursed at the rates set forth in Contract Section
B of this modification until definitization of this UCA.

Contract Section B. is hereby modified to add the following line items. All
amounts are Not to Exceed (NTE):

 

SLIN    Description    Quantity    Unit                Unit Price   
Amount (NTE)

0901

   Claims Processing                        

0913

   Electronic Claims (estimated quantity)                        

0913AA

  

Electronic Claims

FY11

   ****    EA        ****    ****

0913AB

  

Electronic Claims

FY12

****

   ****    EA        ****    ****

0914

  

Paper Claims

(estimated quantity)

                       

0914AA

   Paper Claims FY11    ****    EA        ****    ****

0904AB

   Paper Claims FY12    ****    EA        ****    ****

0902

   Per Member Per Month                        

0902AA

   MHS Eligible Per Member Per Month (First 6 Months)    ****    MM        ****
   ****

0902AB

   MHS Eligible Per Member Per Month (Second 6 Months)    ****    MM        ****
   ****

0902AC

   TRS Enrolled Per Member Per Month (First 6 Months)    ****    MM        ****
   ****

0902AD

   TRS Enrolled Per Member Per Month (Second 6 Months)    ****    MM        ****
   ****

0903

   Disease Management                  

0903AA

   Disease Management FY11    1    LT        ****    ****

0903AB

   Disease Management FY12    1    LT      ****    ****

0903AC

  

Disease Management

4% Fixed Fee FY11

   6    MO        ****    ****

0903AD

  

Disease Management

4% Fixed Fee FY12

   6    MO      ****    ****

0904

   Customer Satisfaction Award Fee Pool                        

0904AA

   First Quarter    1    EA      ****    ****

0904AB

   Second Quarter    1    EA        ****    ****

0904AC

   Third Quarter    1    EA      ****    ****

0904AD

   Fourth Quarter    1    EA        ****    ****

0906

   Transition Out    1    LT        ****    ****                               

MDA90603C0010

P00814

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

0907    TRICARE Service Centers                          0907AA    TRICARE
Service Centers FY11    6    MO         ****    **** 0907AB    TRICARE Service
Centers FY12    6    MO         ****    **** 0908    Underwritten Health Care
Cost                          0908AE    Underwriting Target Fee April 1, 2011
through September 30, 2011                        TBD 0908AF   

Underwriting Health Care Target Cost

April 1, 2011 through September 30, 2011

                       TBD 0908AG    Underwriting Target Fee October 1, 2011
through March 31, 2012                        TBD 0908AH    Underwritten Health
Care Target Cost October 1, 2011 through March 31, 2012                       
TBD

C. The updates to Contract Sections and applicable FAR Clauses for OP IX are as
follows:

(1) At Contract Section C-7.1.1 0., add Option Period IX ****. The section is
hereby revised to read as follows:

C-7.1.10. (a) As a condition of participation in the contractor’s network,
providers shall submit all claims electronically. The contractor shall ensure
that 71 % of all claims submitted by network providers are submitted
electronically for Option Period II. The required percentage of network claims
which must be submitted electronically for the following years is as follows:

Option Period III ****

Option Period IV ****

Option Period V ****

Option Period VI ****

Option Period VII ****

Option Period VIII ****

Option Period IX ****

(2) At Contract Section C-7.3.2., add Option Period VI through IX. The section
is hereby revised to read as follows:

C-7.3.2. Ninety-six percent of referrals of MHS beneficiaries, residing in
TRICARE Prime service areas who seek care through the contractor, shall be
referred to the MTF or a civilian network provider. This percentage shall
include services rendered in network institutions by hospital-based providers
even though no formal referral was made to that individual. The contractor will
increase the percentage of referrals of MHS beneficiaries residing in TRlCARE
Prime service areas who seek care through the contractor, to the MTF, or a
civilian network provider from 96% by 0.25% per year through Option Period V.
The percent of referrals will be held at the Option Period V rate of 97.00% for
Option Period VI through IX. The Administrative Contracting Officer may grant an
exception to this requirement based upon a fully justified

 

MDA90603COO10

P00814

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

written request from the contractor demonstrating that it is in the best
interest of the Government to grant the exception.

(3) At Contract Section C-7.35., update web address. The section is hereby
revised to read as follows:

C-7.35. The contractor shall provide information management and information
technology support as needed to accomplish the stated functional and operational
requirement of the TRICARE program and in accordance with the TRICARE Systems
Manual and the MHS Enterprise Architecture (See
http://www.tricare.mil/architecture)

(4) At Contract Section F.3. Period of Performance, add Option Period IX
April 1, 2011-31 March 2012. The section is hereby revised to read as follows:

F.3. Period of Performance

a. Base Period (Transition costs only): 1 September 2003 - 31 October 2004

Option Period I (All costs other than transition costs): I April 2004 - 31 March
2005

If exercised, Options II through the end of the contract:

Option Period II: I April 2005 - 31 March 2006

Option Period III: 1 April 2006 - 31 March 2007

Option Period IV: 1 April 2007 - 31 March 2008

Option Period V: 1 April 2008 - 31 March 2009

Option Period VI 1 April 2009 - 31 March 2010

Option Period VII 1 April 2010 - 30 Sept. 2010

Option Period VIII I October 2010 - 31 March 2011

Option Period IX 1 April 2011 - 31 March 2012

(5) At Contract Section F.5.(b)(20) Contingency Program, add option periods II
through IX and exclude option period VIII. The section is hereby revised to read
as follows:

F.5.(b) (20) Contingency Program

Quantity: 1

Time of Delivery: For 85% of the MTFs-within 3 months following the start of
option period I; 100% within 6 months following the start of option periods II
through IX. Option Period VIII is excluded.

(6) At Contract Section G.3.(d) Disease Management, add 0903AA and 0903AB The
section is hereby revised to read as follows:

G.3.a(3)(4)(d) Disease Management - Cost Reimbursement SLINs 0105AA, 0203AA,
0303AA, 0403AA, 0503AA, 0603AA, 0703AA, 0803AA, 0903AA, and 0903AB. Invoices
shall separately identify costs associated with C-7.7. 1. 1. from those
associated with C-7.7.1.2. Unless otherwise directed by the Contracting Officer,
interim invoices should be submitted monthly to Defense Contract Audit Agency
(DCAA) for approval with copies provided to RM and the CO. Final voucher will be
submitted to the CO with a copy provided to RM and the COR.

 

MDA90603COO10

P00814

**** Includes Confidential Information omitted and filed separately with the
Commission.

--------------------------------------------------------------------------------

(7) At Contract Section G-5. MILITARY HEALTH SYSTEM (MHS) ELIGIBLE
BENEFICIARIES, add the Government will unilaterally determine the number of HMS
eligible beneficiaries two times each option period, except option periods VII
and VIII. The section is hereby revised to read as follows:

G-5. MILITARY HEALTH SYSTEM (MHS) ELIGIBLE BENEFICIARIES

The Government will unilaterally determine the number of MHS eligible
beneficiaries two times each option period, except for option periods VII and
VIII, under the Per Member per Month contract line item numbers, once for the
first six month period and once for the seventh through twelfth month. The
Government will also make the same unilateral determination once for each option
period VII and VIII.

This will be done using an average of six of the seven previous months of
eligible beneficiaries as reported by the MHS Data Repository in their monthly
“Point-In-Time Extract” as adjusted by TMA (see Attachment 4). Using the number
of MHS eligible beneficiaries, the Government will issue a delivery order for a
six month period.

(8) At Contract Section G-6. MILITARY HEALTH SYSTEM (MHS) TRICARE RESERVE SELECT
ENROLLED BENEFICIARIES, add “The Government will unilaterally determine the
number of TRICARE Reserve Select enrolled beneficiaries two times each option
period, except option periods VII and VII!.” The section is hereby revised to
read as follows:

G-6. MILITARY HEALTH SYSTEM (MHS) TRICARE RESERVE SELECT ENROLLED BENEFICIARIES

The Government will unilaterally determine the number of TRICARE Reserve Select
enrolled beneficiaries two times each option period, except for option periods
VII and VIII, under the TRS Per Member per Month contract line item numbers,
once for the first six month period and once for the seventh through twelfth
month. The Government will also make the same unilateral determination once for
each option period VII and VIII. This will be done using an average of six of
the seven previous months of eligible beneficiaries as reported by the MHS Data
Repository in their monthly “Point-In-Time Extract” as adjusted by TMA (see
Attachment 4). Using the number of TRICARE Reserve Select enrolled
beneficiaries, the Government will issue a delivery order for a six month
period.

(9) At Contract Section H.I.(b)(2)(b), add option period IX. The section is
hereby revised to read as follows:

H.l.(b)(2)(b) For option period II and subsequent periods, the Government and
the contractor will negotiate the target cost before the start of each option
period for the sub-line item numbers for underwritten healthcare and incorporate
them in Section B of the contract. The target cost will be depicted at the
informational sub-line items in each option period. The negotiation process
shall begin with the submission of a proposal by the contractor not later than
the first day of the seventh month of option periods I through VI and IX, with
VII and VIII combined into one negotiation period. Once the target cost for the
next year is established, the only adjustments that would be made for that year
would be for negotiated healthcare changes, definitized healthcare change
orders, other equitable adjustment healthcare change orders issued after the
completion of the negotiations that affect the year just negotiated. If an
agreement cannot be reached on the target cost by 30 days before the start of
the next option period, the option will be exercised using the prior option
period’s target cost as specified in Section B as the estimated target cost in
Section B. A target-setting formula will be used to determine the target

 

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cost. This formula will set the target for the option period retroactively 12 to
18 months after that option period is completed.

The contractor will continue to receive payments for underwritten health care
costs as addressed in Section G, “Payments”, and a portion of fee as addressed
in Section H-2, “Partial Payment of Underwriting Fee during Performance”.

(10) At Contract Section H.l.(b)(3) Target Underwriting Fee, in paragraph 2, add
option IX **** target fee amount of $****. The section is hereby revised to read
as follows:

H.I.b.(3) Target Underwriting Fee The term, “target underwriting fee” is
equivalent to target fee. The target underwriting fee for all option periods is
established at contract award using the contractor’s proposed dollar amount for
the initial contract award as set forth in Section B. When the parties negotiate
the target cost for option period II and/or subsequent periods, the parties will
apply the fee percentage proposed at contract award (for the relevant time
period) to the negotiated target cost to determine the actual target fee. In the
event the parties are unable to negotiate the target cost for option period II
and/or subsequent periods, the target underwriting fee will be the dollar amount
established at contract award. For option period VI through VIII, the fall-back
process is retained, but the dollar amount for use in the “fall-back” formula
established at contract award is determined as follows:

“For option VI, the fixed target fee to be used in the fall-back formula would
be set at the level of the option V negotiated target fee (as modified by any
subsequent change-orders not already considered in the negotiated amount)
accelerated to option VI at the same annual rate as proposed by HMHS for the
acceleration of its fixed-fee amounts from option II through option V (****).
For option VII, which is a six-month option period, the fixed fee amount would
be set at half of the option VI fixed fee, accelerated at the same annual rate
for a period of9 months (from the mid-point of option VI, to the mid-point of
option VII) ,resulting in a multiplicative factor of **** from option VI to
option VII. For option VIII, which is also a six-month option period, the option
VII fixed fee would be accelerated at the same annual rate for an additional six
months (from the mid-point of option VII to the mid-point of option VIII),
resulting in a multiplicative factor of **** from option VII to VIII. The
multiplicative factors will be rounded to four decimal places. Based on this
procedure and the current negotiated target fee for option V ($****), the
following fixed-fee amounts would apply for option VI - $****, option VII -
$****, option VIII - $****. For option IX the fixed target fee to be used in the
fall back formula will be set at the level of the total option V11 and VIII
target fee amount of $****as of P008 10 accelerated to option IX at an annual
rate of **** for a total target fee amount of$****. The target underwriting fee
is then only adjusted by negotiated healthcare changes, definitized healthcare
change orders, or other equitable adjustments. The parties agree to utilize the
same fee percentage proposed for the initial award in these negotiated
adjustments.

(11) At Contract Section H.1.b(5)(c), add option periods III through the end of
the contract. The section is hereby revised to read as follows:

H. I.b(5)(c)Mathematically, this formula may be expressed as:

Target Fee + .20(Target Cost - Actual Cost)

The final determination of fee will occur approximately 12 to 18 months after
the end of the option period to which it applies. This final determination will
be based on underwritten TEDs accepted by TMA through the ninth month (Option
Periods I and II) and through the sixth month

 

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(Option Periods III through the end of the contract), after the end of the
option period. However, prior to the fee determination, the Government will
determine an interim fee approximately three months after the end of the option
period to which it applies based on the available TED data and the Government’s
estimate to completion. Partial and final payment of the fee will be conducted
in accordance with H-2 and H-3.

(12) At Contract Section H.8.(c) Performance Guarantee Amounts, add Option
Period IX $****. The section is hereby revised to read as follows:

H.8.(c) Performance Guarantee Amounts:

Option Period I $ ****

Option Period 11 $****

Option Period III $****

Option Period IV $****

Option Period V $****

Option Period VI $****

Option Period VII $****

Option Period VIII $****

Option Period IX $****

(13) At Contract Section H.9. Award Fee, the award fee pool is prorated into two
quarters in option period I, VII and VIII and into four equal amounts for the
remaining option years. The section is hereby revised to read as follows:

H.9. Award Fee

The award fee will be administered quarterly following the completion of each
contract quarter in accordance with the award fee plan. The award fee pool is
prorated into two quarters in option period I, VII and VIII and into four equal
amounts for the remaining option years, as shown in Section B. Awarded portions
are disbursed quarterly in accordance with the award fee plan. Unawarded
portions of the award fee pool are not available for any subsequent period. The
results of the Government administered surveys will be considered in determining
the award fee and that any contractor administered survey results are
specifically excluded from consideration.

(14) At Contract Section H.II.b(l )(b), add option period IX to the first
paragraph. The section is hereby revised to read as follows: The section is
hereby revised to read as follows:

H.ll.b(l )(b) Sampling Methodology and Application of Results for Option Periods
II through end of the Contract, For Option Periods II through the end of the
contract, the same sampling methodology used will be as described in Section
H.ll.b.(I) (a) above for Option Period 1. For Option Period II, samples will be
drawn from underwritten TED records which are fully or provisionally accepted,
with end dates of service in the option period through the ninth month. For
Option Periods III through VI and IX, samples will be drawn from underwritten
TED records which are fully or provisionally accepted, with end dates of service
in the respective option period, through the sixth month after the end of the
option period. For Option Periods VII and VIII, a single audit will be
performed. If only Option Period VII is exercised, an audit sample will be drawn
from underwritten TED records with end dates of service in Option Period Vll.
Should the Government exercise Option period VIII, an audit sample will be drawn
from underwritten TED records with end dates of service in both Option Periods
Vll and VIII. Sample for Option Periods VII and VIII will be drawn from
underwritten TED records which are fully or provisionally

 

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accepted into the TMA database through the sixth month after the end of the last
exercised Option Period. For Option Periods III through the end of the contract,
the Government will draw the sample no later than seven (7) months after the end
of the respective option period. The Government reserves its rights to perform
specific and/or more frequent audits than annual. Records to be sampled will be
“net” records (i.e. the sum of the option period transaction records available
through the sixth month after the end of the option period). The total
overpayment recovery amount for each option period will be determined based on
the lower bound of a one-sided ninety-percent (90%) confidence interval. The
Government shall provide, at the same time the sample is requested, a complete
listing of all TED records that encompass the audit universe for each respective
Option Period. The contractor must identifY all TED records that it believes
should be excluded from the audit universe which includes non-underwritten
claims and claims that were not within the dates of service range for the
respective Option Period and provide documentation justifying their exclusion
not later than thirty (30) days after receipt of the listing. Claims identified
as nonunderwritten will be removed by the Government from the sample and the
universe, and will not be replaced.

(15) At Contract Section H.II.b.(3)(c)(3), add Option periods II through the end
of the contract. The section is hereby revised to read as follows:

H.ll.b.(3)(c)(3) The contractor will be able to use this process for four full
calendar quarters following the sample claim pull for Option Periods II through
the end of the contract. For Option Period I, the contractor will be able to use
this process for six full calendar quarters following the sample pull. After
that date, recoupments that may be eligible for reimbursement to the contractor
will be addressed through a formal Request for Equitable Adjustment. For
example: If the audit sample is drawn on October 3l’\ then the procedure
outlined above can be used by the contractor through the full calendar quarter
ending December 31 st of the following year with the final list of recoupments
provided to the Government no later than the last day of the following month
when the quarterly report is due.

(16) At Contract Section I Contract Clause 1. 10652.216-18 ORDERING (OCT 1995),
paragraph (a), add 31 March 2012. The section is hereby revised to read as
follows:

(a) Any supplies and services to be furnished under this contract shall be
ordered by issuance of delivery orders or task orders by the individuals or
activities designated in the Schedule. Such orders may be issued from 1 April
2011 through 31 March 2012.

(17) At Contract Section I Contract Clause 1. 108 52.216-21 REQUIREMENTS (OCT
1995), paragraph (f), add 31 March 2012. The section is hereby revised to read
as follows:

(f) Any order issued during the effective period of this contract and not
completed within that period shall be completed by the Contractor within the
time specified in the order. The contract shall govern the Contractor’s and
Government’s rights and obligations with respect to that order to the same
extent as if the order were completed during the contract’s effective period;
provided, that the Contractor shall not be required to make any deliveries under
this contract after 31 March 2012.

(18) At Contract Section I Contract Clauses 1. III 52.217-9 OPTION TO EXTEND THE
TERM OF THE CONTRACT (MAR 2000) paragraph, add shall not exceed 8 years and 10
months. The section is hereby revised to read as follows:

 

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(c) The total duration of this contract, including the exercise of any options
under this clause, shall not exceed 8 years and 10 months.

(19) At Contract Section I Contract Clauses 1.112. 52.232-19 AVAILABILITY OF
FUNDS FOR THE NEXT FISCAL YEAR (APR 1984), add 2011. The section is hereby
revised to read as follows:

Funds are not presently available for performance under this contract beyond 30
Sept 2004120051200612007/2008/2010/2011 as applicable to option periods. The
Government’s obligation for performance of this contract beyond that date is
contingent upon the availability of appropriated funds from which payment for
contract purposes can be made. No legal liability on the part of the Government
for any payment may arise for performance under this contract beyond 30 Sep
20041 20051 20061 20071 2008/2009/20 I0/20 II as applicable to option periods
until funds are made available to the Contracting Officer for performance and
until the Contractor receives notice of availability, to be confirmed in writing
by the Contracting Officer.

D. The following clauses apply to this UCA.

1. 12052.216-24 Limitation of Government Liability.

(a) In the performance of Option Period IX, the Contractor is not authorized to
make expenditures or incur obligations for Administrative CLINS (excluding
Underwritten Health Care Target Costs and Underwritten Target Fee) exceeding $
****.

 

(b) The maximum amount for which the Government shall be liable if this Option
Period IX is terminated is $****.

1. 121252.217-7027 CONTRACT DEFINITIZATION (OCT 1998)

a) A fixed price definitization supplemental agreement to Contract
MDA906-03-C-001O for Administrative CLINS (excluding Underwritten Health Care
Target Costs and Underwritten Target Fee) added by this UCA is contemplated. The
Contractor agrees to begin promptly negotiating with the Contracting Officer the
terms of a definitive contract action that will include (I) all clauses required
by the Federal Acquisition Regulation (FAR) on the date of execution of the
undefinitized contract action, (2) all clauses required by law on the date of
execution of the definitive contract action, and (3) any other mutually
agreeable clauses, terms, and conditions. The Contractor agrees to submit a
fixed price proposal and cost or pricing data supporting its proposal.

 

(b) The schedule for definitizing this contract action is as follows:

Submission of proposal Not Later Than November 19, 2010

Submission of subcontracting Plan Not Later Than November 19, 2010

Begin Negotiations Not Later Than March 21, 2011

Execute definitizing modification Not Later Than April 29, 2011

(c) If agreement on a definitive contract action to supersede this undefinitized
contract action is not reached by the target date in paragraph (b) of this
clause, or within any extension of it granted by the Contracting Officer, the
Contracting Officer may, with the approval of the head of the contracting
activity, determine a reasonable price or fee in accordance with Subpart 15.4
and Part 31 of the FAR, subject to Contractor appeal as provided in the Disputes
clause. In any

 

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event, the Contractor shall proceed with completion of the contract, subject
only to the Limitation of Government Liability clause.

(I) After the Contracting Officer’s determination of price or fee, the contract
shall be governed by (i) All clauses required by the FAR on the date of
execution of this undefinitized contract action for either fixed-price or
cost-reimbursement contracts, as determined by the Contracting Officer under
this paragraph (c); (ii) All clauses required by law as of the date of the
Contracting Officer’s determination; and (iii) Any other clauses, terms, and
conditions mutually agreed upon.

(2) To the extent consistent with paragraph (c)(l) of this clause, all clauses,
terms, and conditions included in this undefinitized contract action shall
continue in effect, except those that by their nature apply only to an
undefinitized contract action.

(d) The definitive contract action resulting from this undefinitized contract
action will include a negotiated fixed price in no event to exceed $****.

(End of clause)

E. As a result of this modification, revised Contract Sections C, F, H, and I,
with changes indicated, are provided.

F. Except for the changes implemented by this modification, all other terms and
conditions of this contract remain in full force and effect.

 

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SECTION C

DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

C-1. General. Section C includes two categories of outcome based statements. The
“Objectives” represent the outcomes for this contract. The objectives are
supported by technical requirements. These requirements represent specific
tasks, outcomes, and/or standards that, at a minimum, must be achieved. The
purpose of this contract is to provide Managed Care Support (MCS) to the
Department of Defense TRICARE program. The Managed Care Support contractor shall
assist the Regional Director and Military Treatment Facility (MTF) Commander in
operating an integrated health care delivery system combining resources of the
military’s direct medical care system and the contractor’s managed care support
to provide health, medical, and administrative support services to eligible
beneficiaries.

C-2. Objectives.

C-2.1. Statement of Objectives. There are five objectives included in this
contract. They are listed below.

Objective 1 – In partnership with the Military Health System (MHS), optimize the
delivery of health care services in the direct care system (see the definition
of Military Treatment Facility Optimization in the TRICARE Operations Manual,
Appendix A) for all MHS beneficiaries (active duty personnel, Military Treatment
Facility (MTF) enrollees, civilian network enrollees, and non-enrollees).

Objective 2 – Beneficiary satisfaction at the highest level possible throughout
the period of performance, through the delivery of world-class health care as
well as customer friendly program services. Beneficiary must be highly satisfied
with each and every service provided by the contractor during each and every
contact.

Objective 3 – Attain “best value health care” (See TRICARE Operations Manual,
Appendix A) services in support of the MHS mission utilizing commercial
practices when practical.

Objective 4 – Fully operational services and systems at the start of health care
delivery. Minimal disruption to beneficiaries and MTFs.

Objective 5 – Ready access to contractor maintained data to support the
Department of Defense’s (DoD) financial planning, health systems planning,
medical resource management, clinical management, clinical research, and
contract administration activities.

C-3. Documents

C-3.1. The following documents, including all changes thereto, are hereby
incorporated by reference and made a part of the contract. These documents form
an integral part of this contract. Documentation incorporated into this contract
by reference has the same force and effect as if set forth in full text. The
technical baseline for this award, as defined during the source selection
process, is the version of each TRICARE manual in effect as of 27 November 2002.

Title 10, United States Code, Chapter 55

32 Code of Federal Regulations, Part 199

TRICARE Operations Manual (TOM) 6010.51-M, August 1, 2002 (through change 107)

 

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SECTION C

DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

TRICARE Policy Manual (TPM) 6010.54-M, August 1, 2002 (through change 133)

TRICARE Reimbursement Manual (TRM) 6010.55-M, August 1, 2002 (through change
123)

TRICARE Systems Manual (TSM) 7950.1-M, August 1, 2002 (through change 86)

C-3.2. The contractor’s subcontracting plan is hereby incorporated and made a
part of the contract.

C-4. Definitions. Definitions are included in Appendix A of the TRICARE
Operations Manual.

C-5. Government-Furnished Property and Services. Government property furnished
to the contractor for the performance of this contract includes the furnishing
of telephone lines and computer drops in accordance with General Services
Administration (GSA) direction. At certain MTFs, space and equipment may be
provided for the TRICARE Service Center (TSC). This may include information
management hardware and software to allow the contractor to access the Composite
Health Care System (CHCS). Equipment at the TRICARE Service Centers is described
in Attachment 8, List of Data Package Contents.

C-6. Contractor-Furnished Items. The contractor furnishes all necessary items
not provided by the Government for the satisfactory performance of this
contract.

C-7. Technical Requirements. The contractor must fulfill the technical
requirements listed below in accomplishing the overall objectives of this
contract.

C-7.1. The contractor shall provide a managed, stable, high-quality network, or
networks, of individual and institutional health care providers which
complements the clinical services provided to MHS beneficiaries in MTFs and
promotes access, quality, beneficiary satisfaction, and “best value health care”
for the Government. (See the TOM, Appendix A for the definition of best value
health care.)

C-7.1.1. The contractor’s network shall be accredited by a nationally recognized
accrediting organization no later than 18 months after the start of health care
delivery in all geographic areas covered by this contract. When this contract
and the accrediting body both have standards for the same activity, the higher
standard shall apply.

C-7.1.2. MTFs will only refer their TRICARE Prime enrollees to a non-network
civilian provider when it is clearly in the best interest of the Government and
the beneficiary, either clinically or financially. Such cases are expected to be
rare. Federal health care systems (for example Veterans Administration and
Indian Health Service) are excluded from this Government policy.

C-7.1.3. Provider networks for the delivery of Prime and Extra services shall be
established in 100% of the South region. TRICARE Prime areas are defined as a
forty-mile radius around catchment areas, the designated military treatment
facilities in Attachment 11, Base Realignment and Closure (BRAC) sites, and any
additional Prime sites proposed by the contractor. The network must include
providers that accept Medicare assignment in sufficient quantity and diversity
to meet the access standards of 32 CFR 199.17 for the MHS Medicare population
residing in the area.

C-7.1.4. The contractor shall inform the Government within 24 hours of any
instances of network inadequacy relative to the Prime and/or Extra service areas
and shall submit a corrective action

 

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SECTION C

DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

plan with each notice of an instance of network inadequacy. (Network inadequacy
is defined as any failure to meet the access standards.) The contractor shall
respond to any inquiries from agents of the Government concerning network
adequacy, including requests for information on provider turnover, from a
Contracting Officer (Procuring Contracting Officer or Administrative Contracting
Officer), Contracting Officer’s Representative (COR), Alternate Contracting
Officer’s Representative (ACOR), or Regional Director. The response shall be
accomplished within two business days from receipt of a request.

C-7.1.5. The contractor shall ensure that provider networks and services can be
adjusted as necessary to compensate for changes in MTF capabilities and
capacities. The contractor shall also ensure that all eligible beneficiaries who
live in Prime service areas have the opportunity to enroll, add additional
family members, or remain enrolled in the Prime program regardless of such
changes. MTF capabilities and capacities may change frequently over the life of
the contract without prior notice. The contractor shall adjust the capabilities
and capacities of the network to compensate for such changes when and where they
occur over the life of the contract, including short notice of unanticipated
facility expansion, provider deployment, downsizing and/or closures.

C-7.1.6. The contractor shall inform potential network providers, through
network provider agreements, that they agree to being reported to the Department
of Veterans Affairs (DVA) as a TRICARE network provider. The contractor shall
request potential non-institutional network providers to accept requests from
the DVA to provide care to veterans. The agreement will give the DVA the right
to directly contact the provider and request that he/she provide care to veteran
(VA) patients on a case by case basis. The TRICARE network provider is never
obligated to see the VA patient, but, if seen by the network provider, any
documentation of the care rendered to the VA patient and reimbursement for the
care is a matter between the referring VA Medical Center (VAMC) and the
provider. The referral and instructions for seeking reimbursement from the VAMC
will be provided by the patient at the time of the appointment. Those providers
who express a willingness to receive DVA queries as to availability shall be
indicated in a readily discernable manner on all public network provider
listings. (Note: Nothing prevents the VA and the provider from establishing a
direct contract relationship if the parties so desire. When a direct contract is
in place, the contractor may deviate from this section.)

C-7.1.6.1. The contractor shall inform potential network providers, through
network provider agreements, that they agree to being reported to Civilian
Health and Medical Program of the Veteran’s Administration (CHAMPVA) as a
TRICARE network provider. The contractor shall request potential network
providers (individual, home health care, free-standing laboratories, and
radiology only) that they accept assignment for CHAMPVA beneficiaries.

The contractor shall ask all providers proposed for the network to accept
assignment (see the CHAMPVA beneficiary locations in the data package,
Attachment 8). The contractor shall not make this request a condition of
participating in the TRICARE Network but an option. Providers need see only
CHAMPVA beneficiaries when their practice availability allows and shall not give
preferential appointment scheduling to CHAMPVA over TRICARE appointments.
Network providers are not required to meet access standards for CHAMPVA
beneficiaries, but are encouraged to do so. The contractor shall also provide to
the provider the CHAMPVA-furnished claims processing instructions (Attachment 1)
on submitting CHAMPVA claims to the VA Health Administration Center (P.O. Box
65024, Denver, CO 80206-9024) for payment. Providers at their discretion may
offer the negotiated TRICARE discount directly to CHAMPVA. For all

 

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SECTION C

DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

published network provider listing, the contractor shall indicate in a readily
discernable manner which providers accept CHAMPVA assignment on claims.

C-7.1.7. The contractor shall ensure that the standards for access, in terms of
beneficiary travel time, appointment wait time, and office wait time for various
categories of services contained in 32 CFR 199.17(p)(5) are met for
beneficiaries residing in a TRICARE Prime service area. These standards shall be
met in a manner which achieves beneficiary satisfaction with access to network
providers and services as set forth in the contract.

C-7.1.8. The contractor shall maintain an accurate, up-to-date list of network
providers including their specialty, gender, work address, work fax number, and
work telephone number for each service area, whether or not they are accepting
new beneficiaries, and the provider’s status as a member of the Reserve
Component or National Guard. The contractor shall provide easy access to this
list, to include making it available upon request, for all beneficiaries,
providers, and Government representatives. The contractor shall, at a minimum,
maintain this list in a mutally agreeable format for which the contractor agrees
not to claim any proprietary interest. For the purposes of this requirement,
“up-to-date” means an electronic, paper, telephone or combination of these
approaches that accurately reflects the name, specialty, gender, work address,
and work telephone number of each network provider and whether or not the
provider is accepting new patients. The information contained on all electronic
lists shall be current within the last 30 calendar days.

C-7.1.9. The network, or networks, shall complement services provided by MTFs in
the region. They shall be sufficient in number, mix, and geographic distribution
of fully qualified providers to provide the full scope of benefits for which all
Prime enrollees are eligible under this contract, as described in 32 CFR 199.4,
199.5, and 199.17. The contractor’s provider networks shall also support the
requirements of special programs described in the TRICARE Operations Manual and
TRICARE Policy Manual.

C-7.1.10. (a) As a condition of participation in the contractor’s network,
providers shall submit all claims electronically. The contractor shall ensure
that **** of all claims submitted by network providers are submitted
electronically for Option Period II. The required percentage of network claims
which must be submitted electronically for the following years is as follows:

Option Period III ****

Option Period IV ****

Option Period V ****

Option Period VI ****

Option Period VII ****

Option Period VIII ****

Option Period IX ****

When electronic claims fall below the required percentage for any Option Period,
the Government shall recover the overpayments on an annual basis. Overpayment
will be calculated based on the difference between paper claim rate and
electronic claim rate specified in Section B of the contract for the number of
claims falling below the required percentage. The Contracting Officer wil1 issue
a demand letter for the recovery of overpayment.

(b) Contractor shall maintain the provider network size of **** physicians and
behavioral health professionals as measured on a monthly basis by the HMHS
report ZUPRV400R entitled “South Region Network Adequacy Report by Prime Service
Area Grand Summary Report” in the

 

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SECTION C

DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

categories of primary care, medical specialists, surgical specialists, and
behavioral health specialists.

C-7.1.11. All acute-care medical/surgical hospitals in the contractor’s provider
networks are encouraged to become members of the National Disaster Medical
System (NDMS).

C-7.1.12. The contractor shall ensure that all network providers and their
support staffs gain a sufficient understanding of applicable TRICARE program
requirements, policies, and procedures to allow them to carry out the
requirements of this contract in an efficient and effective manner which
promotes beneficiary satisfaction. This requirement pertains to all network
providers and their staff and to TRICARE-authorized providers in the region. The
contractor shall use the education material provided by the Government.

C-7.1.13. When provided by DVA, the contractor shall make available marketing
and educational information on the VA and CHAMPVA at any provider briefings.
[The contractor shall furnish the VA Health Administration Center (P.O. Box
65024, Denver, CO 80206-9024) its central address for delivery of these
materials.] The contractor is not required to, but may, brief these materials.

C-7.1.14. All network and non-network providers who provide services and receive
reimbursement under this contract shall be TRICARE-authorized providers in
accordance with the criteria set forth in 32 CFR 199.6. The contractor shall
verify all providers’ authorized status through the TRICARE Management Activity
centralized TRICARE Encounter Provider Record (TEPRV) or, if not listed, shall
obtain and maintain documentary evidence that the provider meets the criteria
set forth in 32 CFR 199.6, the TRICARE Policy Manual, and TRICARE Reimbursement
Manual.

C-7.1.15. The contractor shall ensure that no network provider requires payment
from a beneficiary for any excluded or excludable service that the beneficiary
received from a network provider (i.e. the beneficiary shall be held harmless)
unless the beneficiary has been properly informed that the services are
excludable and has agreed in advance of receiving the services, in writing, to
pay for such services. An agreement to pay must be evidenced by written records.
A beneficiary who is informed that care is potentially excludable and proceeds
with receiving the potentially excludable service shall not, by receiving such
care, constitute an agreement to pay. General agreements to pay, such as those
Signed by the beneficiary at the time of admission, is not evidence that the
beneficiary knew specific services were excluded or excludable.

C-7.2 Clearly Legible Reports Standard:

a. The contractor shall ensure 98 percent of all contractor approved MTF
provider referrals for network specialty care that are designated as evaluate
only (“eval only”) by the MTF provider and not part of the exclusion criteria as
defined in C-7.2.2, will result in a clearly legible consultation report being
provided to the referring MTF within 10 working days from the last date service
was rendered in the referred care process. The remaining 2 percent of the eval
only referrals shall be provided within 30 calendar days from the last date
service was rendered in the referred care process, 100 percent of the time.

b. The contractor shall ensure 100 percent of all contractor approved MTF
provider referrals for network specialty care that are processed as evaluate &
treat and not part of the exclusion criteria as defined in C-7.2.2 will result
in a clearly legible consultation report to the referring

 

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MTF provider within 30 calendar days from date the initial visit was rendered in
the referred care process.

c. When a consult report is not received within the 10 working day standard for
“eval only” and 30 calendar day standard for the “eval and treat”, the MTF can
request, via a web tool, an “expedited chase” for clinically significant consult
reports (based on CORE MOU processes). The contractor shall provide all
necessary services to obtain these consult reports within 3 working days from
the next working day after the request was registered on the web.

d. In urgent/emergent situations, a preliminary report of a specialty
consultation shall be conveyed to the beneficiary’s initiating provider within
24 hours (unless best medical practices dictate less time is required for a
preliminary report) by telephone, fax or other means with a formal written
report provided within the standards described under a and b above.

e. The contractor will provide all necessary services to expedite receipt of
consult reports that did not meet either the 10 working day or 30 calendar day
return requirement.

C-7.2.1. Clearly Legible Report Definitions:

1. Evaluate Only (“eval only”) and Evaluate and Treat (“eval and treat”). “Eval
only” is a referral request to have a specialist evaluate the patient’s
condition, but treatment will be performed in the direct care system, and “eval
and treat” is a referral request to have a specialist evaluate and treat the
patient’s condition.

a. “eval only” – This is defined as a referrals designated by the MTF provider
as “eval only”.

b. “eval and treat” – This is defined as a referral which the MTF provider did
not designate as “eval only”.

2. Confirmed Visit. The visit to the specialist is considered “confirmed” (by
any means of recognizing a visit that actually occurred – not just those
recognized via claims activity) if the appointment date is known and the visit
occurred.

3. No Shows. The definition of “No Shows” is when beneficiaries fail to execute
their approved referral within 5 months after the referral approval month. It
includes referrals designated “No indication of Service.” These include
referrals the patient missed intentionally or inadvertently and referrals the
patient failed to schedule an appointment.

4. Working Day – is Monday through Friday, excluding government holidays.

C-7.2.2. The requirements specified in Section C-7.2, paragraphs a. through e.
above, apply to “eval only” and “eval and treat” contractor approved MTF
provider referrals for professional services provided by a health care provider
(as defined in 32 CFR 199) to assist the MTF provider in the diagnosis and
treatment of a patient, including, for example, interventional radiology
studies, physical therapy, occupational therapy, and speech therapy. The
performance requirement does not apply to the referrals for non-professional
services such as durable medical equipment or laboratory studies. The following
categories of referrals are not included in the 10 working day or 30 calendar
day consult report standards:

 

  •  

Durable Medical Equipment (DME)

 

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  •  

External Resource Sharing Referrals

 

  •  

Other Health Insurance

 

  •  

Urgent Care Center

 

  •  

Self-referrals:

Retrospective

Emergency

Optometrist (self referrals)

Behavioral Health (self referrals)

Other

C-7.3. The contractor’s referral management processes shall include a provision
for evaluating the proposed service to determine if the type of service is a
TRICARE benefit and informing the beneficiary prior to the visit in the event
the requested service is not a TRICARE benefit. This shall not be a
preauthorization review. Rather, this process shall be a customer
service/provider relation’s function providing an administrative coverage
review. This service shall be accomplished for every referral received by the
contractor regardless of whether it was generated by an MTF, network provider or
non-network provider.

C-7.3.1. In TRICARE Prime areas that include an MTF, the MTF has the right of
first refusal for all referrals and shall be addressed in the MOU. First right
of refusal is defined as providing the MTF with an opportunity to review each
referral from a civilian provider to determine if the MTF has the capability and
capacity to provide the treatment. All electronic referrals to an MTF shall be
by the appropriate HIPAA-compliant transaction.

C-7.3.2. Ninety-six percent of referrals of MHS beneficiaries, residing in
TRICARE Prime service areas who seek care through the contractor, shall be
referred to the MTF or a civilian network provider. This percentage shall
include services rendered in network institutions by hospital-based providers
even though no formal referral was made to that individual. The contractor will
increase the percentage of referrals of MHS beneficiaries residing in TRICARE
Prime service areas who seek care through the contractor, to the MTF, or a
civilian network provider from 96% by 0.25% per year through Option Period V.
The percent of referrals will be held at the Option Period V rate of 97.00% for
Option Period VI through IX. The Administrative Contracting Officer may grant an
exception to this requirement based upon a fully justified written request from
the contractor demonstrating that it is in the best interest of the Government
to grant the exception.

C-7.4. The contractor shall ensure that civilian medical care funded through
this contract, including mental health care, is medically necessary and
appropriate and complies with the TRICARE benefits contained in 32 CFR 199.4 and
199.5. The contractor shall not perform medical necessity reviews or factual
determinations for care proposed and/or rendered in the MTF. The contractor
shall use best practices consistent with law, regulation and TRICARE policy in
reviewing and approving care and establishing medical management programs to
carry out the validation of medical necessity and appropriateness to the extent
authorized by law. Notwithstanding the contractor’s authority to utilize its
best practices in managing, reviewing and authorizing health care services, the
contractor shall comply with the provisions of 32 CFR 199.4, 32 CFR 199.5, and
the TRICARE Policy Manual when reviewing and approving medical care. The
contractor shall be considered a multi-function Peer Review Organization (PRO)
under this contract and shall follow all standards, rules, and procedures of the
TRICARE PRO program.

 

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C-7.5. The contractor shall establish a system that ensures that care received
outside the MTF and referred by the MTF for MTF enrollees is authorized (when
medically necessary and a TRICARE benefit) and entered into the contractor’s
claims processing system to ensure the appropriate adjudication of claims for
enrollee’s care. The MTF will transmit referral information in a HIPAA compliant
manner. The contractor, using its authority as a Peer Review Organization, shall
apply its own utilization management practices to care received by MTF enrollees
in a civilian setting consistent with MTF referral instructions. The contractor
shall fax a copy (or by other electronic means addressed in each MTF MOU) of
these utilization management decisions to the MTF Commander the day the decision
is made.

C-7.6. The contractor shall provide comprehensive, readily accessible customer
services that includes multiple, contemporary avenues of access (for example,
e-mail, World Wide Web, telephone, facsimile, et cetera) for the MHS
beneficiary. Customer services shall be delivered in a manner that achieves the
objectives of this contract without charge to beneficiaries or providers.

C-7.7. The contractor shall operate a medical management program for all MHS
eligible beneficiaries receiving care in the civilian sector, except as
specified in Section C-7.7.1, that achieve the objectives of this contract. The
contractor’s medical management program must fully support the services
available within the MTF.

C-7.7.1. The contractor shall operate programs designed to manage the health
care of individuals with high-cost conditions or with specific diseases for
which proven clinical management programs exist. These programs shall be
available to TRICARE eligible beneficiaries authorized to receive reimbursement
for civilian health care per 32 CFR 199. These programs shall also be available
to active duty personnel whose care occurs or is projected to occur in whole or
in part in the civilian sector. These programs shall exclude MEDICARE dual
eligible beneficiaries. When care occurs within an MTF, the contractor is
responsible for coordinating the care with the MTF clinical staff as well as the
civilian providers. The contractor shall propose medical management programs and
patient selection criteria for review and approval of the Regional
Administrative Contracting Officer prior to implementation and annually
thereafter.

C-7.7.1.1. For disease management conditions identified by the Government to be
included in the Contractor’s disease management program, the Government will
identify the population, risk stratification and minimum measurements of success
and evaluation. The contractor shall submit an implementation plan that
demonstrates the disease management intervention(s) and confirms patients meet
inclusion criteria in the disease management program using the Government
provided patient identification lists, selection criteria, and risk
stratification. The contractor’s plan shall include the information that will be
provided in sufficient detail to allow the Government to effectively evaluate
the DM program in accordance with the Government provided measures of success
and elements of evaluation. In order for the Government to be able to evaluate
the contractor’s disease management program, the contractor shall include a plan
for accounting and reporting on the cost and performance of all disease
management programs, plus provide the specific guidelines and protocols they
will utilize. The plan and cost estimate are subject to review and approval by
the Regional Administrative Contracting Officer prior to implementation and
annually thereafter. The Government will not prescribe strict program protocols,
e.g. how often to call patients or use of technology.

 

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C-7.7.1.2. For disease management conditions identified by the Contractor to be
included in the disease management program, the Contractor shall identify the
patient selection criteria, i.e. population and risk stratification, for review
and approval. The contractor shall submit a cost estimate and comprehensive
implementation plan. The plan and cost estimate are subject to review and
approval by the Regional Administrative Contracting Officer prior to
implementation and annually thereafter. In order for the Government to be able
to evaluate the contractor’s disease management program, the contractor will
separately account for all costs associated with contractor initiated disease
management conditions from those conditions initiated by the Government.

C-7.7.1.3. In cooperation with the MTF, the contractor shall coordinate the care
and transfer of patients who require a transfer from one location to another.
This function shall include coordination with the primary clinician at the
losing and gaining sites, the patient’s family, arranging medically appropriate
patient transport, ensuring all necessary supplies are available during the
transport and at the receiving location, arranging for and ensuring the presence
of all necessary medical equipment during transport and at the receiving
location, and identifying and ensuring the availability of necessary resources
to accomplish the transfer. Transfers may occur as a result of medical, social,
or financial reasons and include moves of non-institutionalized and
institutionalized patients.

C-7.8. “Reserved”

C-7.9. The contractor shall meet with and establish a Memorandum of
Understanding with TMA Communications and Customer Service Directorate (C&CS) in
accordance with the TRICARE Operations Manual, Chapter 12, Section 1.

The MOU shall address all interface requirements necessary to effectively
administer the program. The contractor shall partner and collaborate with C&CS
on the identification and development of marketing and education materials
required to support the accomplishment of the Marketing and Education Plan
submitted in accordance with the TRICARE Operations Manual, Chapter 12.

C-7.10. All enrollments, re-enrollments, disenrollments, and transfers, to
include enrollment activities of TRICARE Plus, shall be in accordance with the
provisions of the TRICARE Operations Manual, Chapter 6 and the TRICARE Systems
Manual. The contractor shall accomplish primary care manager by name assignment
in accordance with the TRICARE Systems Manual.

C-7.11. The contractor shall use the TRICARE Enrollment and Disenrollment Forms,
Attachments 2 and 3. The contractor shall reproduce the form as necessary to
ensure ready availability to all potential enrollees. The contractor shall
implement enrollment processes that take advantage of current technology while
ensuring access and assistance to all beneficiaries which does not duplicate
Government systems.

C-7.12. Beneficiaries choosing TRICARE Prime enrollment shall be enrolled to the
MTF, on a first come, first served basis, until the enrollment capacity
established by the MTF Commander is reached. The contractor shall ensure that
MTF capacity is reached before beneficiaries may be enrolled to the contractor’s
network.

 

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C-7.12.1. The MTF Commander, with prior notification to the Regional Director,
may make exceptions to the requirement to enroll all beneficiaries to the MTF
prior to enrollment to the contractor’s network. Such instances should be rare
and should be based on valid clinical capability to meet the individual
healthcare needs of the patient.

C-7.13. The contractor shall enroll, re-enroll, disenroll, transfer enrollments,
clear enrollment discrepancies assign or change Primary Care Manager (PCM), and
related functions for all active duty personnel in TRICARE Prime following the
same procedures applicable to non-active duty beneficiaries (TRICARE Operations
Manual, Chapter 6). For beneficiaries returning from or transferring to OCONUS,
the contractor shall follow the requirements of the TRICARE Policy Manual.

C-7.14. The contractor shall provide commercial payment methods for Prime
enrollment fees that best meets the needs of beneficiaries. The contractor shall
accept payment of fees by payroll allotment or electronic funds transfer from a
financial institution as well as other payment types (e.g., check, credit cards)
in sufficient variations to achieve beneficiary satisfaction. The contractor
shall not require beneficiaries to pay an administrative fee of any kind for use
of a particular payment option offered by the contractor. The contractor shall
accept payment of enrollment fees on a monthly, quarterly, or annual basis. The
contractor shall provide beneficiaries with written notice of a payment due in
accordance with the TRICARE Operations Manual and when beneficiaries are
delinquent.

C-7.15. The contractor shall ensure that enrollment on transition phase-in and
transfers of enrollment, i.e., portability, as described in the TRICARE
Operations Manual, Chapter 6, are accomplished in a way that allows for
uninterrupted coverage for the TRICARE Prime enrollee. During transition, the
incoming contractor shall enroll all TRICARE Prime beneficiaries to their
assigned PCM and maintain the beneficiary’s enrollment periods from the outgoing
contractor. If a beneficiary’s civilian primary care manager remains in the
TRICARE network, the beneficiary may retain their primary care manager. If the
beneficiary must change primary care managers, all enrollments shall be to the
MTF until MTF capacity, as determined by the MTF Commander, is reached.

C-7.16. The contractor shall establish a customer service presence for all MHS
eligible beneficiaries, including traveling beneficiaries, at each catchment
area, designated MTF in Attachment 11, Prime service area, and BRAC site, either
within the MTF or on the base if space is available, or if a BRAC site, at a
location convenient to beneficiaries. These sites, and any other similar site
established by the contractor, shall be named TRICARE Service Centers (TSCs)
regardless of the extent of services offered. The data package described in
Attachment 8 describes the space, if Available, at each MTF. Where the space is
insufficient to support all TRICARE Service Center activities, the contractor
shall establish those customer service activities not available on site in a
manner that is convenient to beneficiaries and provides the highest service
levels. The contractor shall maintain a sufficient supply of TRICARE education
and marketing materials at each TSC to adequately support information requests.
When furnished by the DVA, the contractor shall maintain quantities of
information on VA and CHAMPVA at each TSC [the contractor shall furnish the VA
Health Administration Center (P.O. Box 65024, Denver, CO 80206-9024) its central
address for delivery of these materials.]. The contractor shall have the ability
to provide TSC services during periods when access to the TSC physical space is
limited or terminated as a result of weather, war, security, or MTF/Base
Commander’s decision.

 

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C-7.17. The contractor shall provide customer service support equal to ten
person-hours per week to be used at the discretion of and for the purpose
specified by the MTF Commander. Examples of possible uses of this time include
in processing briefings/enrollments, TRICARE briefings, and specialty briefings
on specific components of TRICARE or focused to a specific subset of TRICARE
beneficiaries. (The Regional Director may provide input for needed non MTF area
activities.) This is in addition to the requirements for briefings and
attendance at meetings specified in the TRICARE Operations Manual, Chapter 12.

C-7.18. The contractor shall provide assistance in accessing information about
other Department of Defense programs and applicable community/state/federal
health care and related resources for all MHS eligible beneficiaries who require
benefits and services beyond TRICARE. This function shall be referred to as
Health Care Finder Services.

C-7.19. The contractor shall ensure that all contractor personnel working in DoD
Medical Treatment Facilities meet the MTF-specific requirements of the facility
in which they will be working and comply with all local Employee Health Program
(EHP) and Federal Occupational Safety and Health Act (OSHA) Blood borne
Pathogens (BBP) Program requirements.

C-7.20. All customer assistance provided by telephone shall be without long
distance charges to the beneficiary.

C-7.20.1. The contractor shall perform all customer service functions with
knowledgeable, courteous, responsive staff.

C-7.20.2. The contractor shall establish twenty-four hour, seven days a week,
nationally accessible telephone service, without long distance charges, for all
MHS beneficiaries, including beneficiaries traveling in the contractor’s area
seeking assistance in locating a network provider. This function shall be
accomplished with live telephone personnel only.

C-7.21. The contractor shall establish, maintain, and monitor an automated
information system to ensure claims are processed in an accurate and timely
manner, and meet the functional system requirements as set forth in the
technical requirements, TRICARE Operations Manual, and the TRICARE Systems
Manual. The claims processing system shall be a single data base and be HIPAA
compliant.

C-7.21.1. The contractor shall ensure that TRICARE claims/encounters (including
adjustments) are timely and accurately adjudicated for all care provided to
beneficiaries based on the timeliness and quality standards of the TRICARE
Operations Manual, Chapter 1, Section 3.

C-7.21.2. The contractor shall provide data at the beneficiary,
non-institutional and institutional level, with the intent of providing the
Government with access to the contractor’s full set of data associated with
TRICARE. The data shall include, but is not limited to, data concerning the
provider network, enrollment information, referrals, authorizations, claims
processing, program administration, beneficiary satisfaction and services, and
incurred cost data.

C-7.21.3. Nationally recognized paper claim forms (UB-92, HCFA 1500s, and their
successors) or TRICARE-specific paper claim forms (DD Form 2642) shall be
accepted for processing. Standardized electronic transactions and code sets as
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Simplification section of the Health Insurance Portability and Accountability
Act (HIPAA) shall be accepted.

C-7.21.4. The contractor shall, as one means of electronic claims submission,
establish and operate a system for two way, real time interactive Internet Based
Claims Processing (IBCP) by providing web based connectivity to the
claims/encounter processing system for both institutional and non-institutional
claims processing. This IBCP system shall provide immediate eligibility
verification by connectivity to DEERS and provide current deductible,
Catastrophic Cap, and cost share/co-payment information to the provider on-line
by connectivity to the DEERS catastrophic loss protection function and
connectivity to the authorization system. The IBCP system shall comply with
Department of Defense accreditation and encryption requirements as outlined in
TSM Chapter 1, Section 1.1. The contractor shall regularly update the IBCP
system to utilize latest encryption security protocols.

C-7.21.5. The contractor’s claims/encounter processing system shall interface
with and accurately determine eligibility and enrollment status based on the
Defense Enrollment Eligibility Reporting System (DEERS) in accordance with the
TRICARE Systems Manual.

C-7.21.6. The contractor’s claims processing/encounter system shall accurately
process claims in accordance with the TRICARE benefit policy as delineated in 32
CFR Part 199.4 and 199.5, the TRICARE Policy Manual, and TRICARE Reimbursement
Manual.

C-7.21.7. The contractor’s claims processing/encounter system shall accurately
process claims in accordance with the program authorizations (e.g., Program for
Persons with Disabilities, inpatient mental health, adjunctive dental).

C-7.21.8. The contractor’s claims processing/encounter system shall correctly
apply deductible, co-pay/coinsurance, cost shares, catastrophic cap, and
point-of-service provisions in accordance with the TRICARE benefit policy as
delineated in 32 CFR Part 199.4 and 199.5, 199.17 and 199.18, the TRICARE Policy
Manual, and TRICARE Reimbursement Manual.

C-7.21.9. The contractor’s claims/encounter processing system shall accurately
coordinate benefits with other health insurances to which the beneficiary is
entitled as required by 32 CFR 199.8, the TRICARE Policy Manual, and TRICARE
Reimbursement Manual.

C-7.21.10. Claims requiring additional information may be returned or developed
for the missing information. The contractor shall ensure that all required
information is requested with the initial return or development action and that
no claim/encounter is returned/developed for information that could have been
obtained internally or from DEERS. The contractor shall ensure that an adequate
audit trail is maintained for all returned or denied claims.

C-7.21.11. The contractor shall ensure non-network claims received more than 12
months after the date of service are denied unless the requirements contained in
32 CFR 199.7 are met. Timely filing requirements for network providers shall be
governed by the network provider agreement, but shall not exceed 12 months from
date of service (or discharge).

C-7.21.12. The contractor shall accurately adjudicate claims under the Program
for Persons with Disabilities and the special programs listed in the TRICARE
Policy Manual, TRICARE Reimbursement Manual and 32 CFR 199.5.

 

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C-7.21.13. The contractor shall accurately identify and adjudicate claims
involving third party liability (TPL) and worker’s compensation (WC), as
required by the TRICARE Operations Manual, Chapter 11.

C-7.21.14. The contractor shall accurately identify and adjudicate claims
involving foreign claims according to the TRICARE Policy Manual. This includes
claims for TRICARE/Medicare dual eligible beneficiaries receiving care in
foreign locations with the exception of Puerto Rico, Guam, American Samoa,
Northern Marianas and the United States Virgin Islands. In addition, the
contractor shall not process retail pharmacy claims from Puerto Rico, Guam, and
the United States Virgin Islands.

C-7.21.15. The contractor shall manage enrollments, collect premiums, accurately
identify and adjudicate claims and perform all requirements involving Continued
Health Care Benefit Program according to the TRICARE Policy Manual.

C-7.21.16. The contractor shall accurately reimburse network providers in
accordance with the payment provisions contained in the provider
agreement/contract. The contractor’s reimbursement to network providers shall
not exceed the amount which would have been reimbursed using the TRICARE payment
methodologies and limits contained in 32 CFR 199.14, the TRICARE Policy Manual,
and TRICARE Reimbursement Manual.

C-7.21.17. The contractor shall accurately reimburse non-network provider claims
in accordance with applicable statutory (Chapter 55, Title 10, United States
Code) and regulatory provisions (32 CFR 199.14), and implementing instructions
in the TRICARE Policy Manual and TRICARE Reimbursement Manual.

C-7.21.18. The contractor shall ensure that TRICARE Prime beneficiaries have no
liability for amounts billed, except for the appropriate co-payment, for
referred care, including ancillary services from a non-network provider as a
result of a medical emergency or as a result of the TRICARE Prime beneficiary
being referred to a non-network provider by the contractor. For example, this
provision applies when a beneficiary is referred for surgery from a network
surgeon in a network hospital, but the anesthesiologist is a non-network
provider. Amounts paid in excess of the CHAMPUS Maximum Allowable Charge (CMAC),
diagnosis related groups (DRG), or prevailing charge to non-network providers
shall not be reported or used as health care costs for the purpose of the actual
costs reported for health care fee determination under Section H.

C-7.21.19. Locality waivers for reimbursement, generated and approved in
accordance with the TRICARE Reimbursement Manual, shall be as set forth in
Section J, Attachment 6, of the contract and shall apply to claims processed
under the contract, including , but not limited to, claims processed under the
provisions of C-7.21.14.

C-7.22. The contractor shall provide to each beneficiary and each non-network
participating provider an Explanation of Benefits (EOB) that describes the
action taken on claims. The contractor may issue EOBs to network providers, as
stipulated in the network provider agreement. The EOB must clearly describe the
action taken on the claim or claims; provide information regarding appeal
rights, including the address for filing an appeal; information on the
deductible and catastrophic cap status following processing; and, sufficient
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a beneficiary to file a claim with a supplemental insurance carrier. The
contractor shall mail the requested EOB, without charge to the beneficiary,
within 5 calendar days of receiving a request (written, verbal, electronic) for
an EOB from a beneficiary, regardless of their status. At the option of the
providers, HIPAA-compliant electronic remittance advices shall be provided.

C-7.22.1. The contractor shall suppress EOBs in accordance with the TRICARE
Operations Manual, Chapter 8.

C-7.23. The contractor shall accurately capture and report TRICARE Encounter
Data (TED) related to claims adjudication in accordance with the provisions of
the TRICARE Systems Manual and shall ensure the standards contained in this
contract are achieved according to the TRICARE Operations Manual. All TED
records shall comply with the information management requirements of this
contract and shall be reported in compliance with the standards in the TRICARE
Operations Manual.

C-7.23.1. The contractor shall submit information on all providers authorized by
the contractor, to the TRICARE Management Activity centralized TRICARE Encounter
Provider Record system in accordance with the provisions of the TRICARE Systems
Manual.

C-7.24. The contractor shall establish and maintain sufficient staffing and
management support to meet the requirements of this contract and comply with all
management standards in the TRICARE Operations Manual, Chapter 1, Section 4.0.

C-7.24.1. The contractor shall participate in quarterly round table meetings
with the Government, all other Managed Care Support contractors, and any other
participants that the Government determines is necessary. The round table
requires high level managerial participation from the contractors (CEOs, Medical
Directors, etc.) and participation by the contractor’s technical and cost
experts as determined by the agenda. The first round table will be held no later
than 6 months after the start of health care delivery of the last Managed Care
Support contract. The round table is tasked with reviewing current policies and
procedures to determine where proven best practices from the participants’
Government and private sector operations can be implemented in the
administration of TRICARE to continue TRICARE’s leading role as a world class
health care delivery system.

C-7.25. The contractor shall establish and continuously operate an internal
quality management/quality improvement program covering every aspect of the
contractor’s operation, both clinically and administratively. A copy of the
documents describing the internal quality management/quality improvement program
shall be provided to the Contracting Officer in accordance with Section F,
paragraph F.5. A report listing problems identified by the contractor’s internal
quality management/quality improvement program and the corrective actions
planned/initiated shall be provided to the Contracting Officer in accordance
with Section F, paragraph F.5. The contractor shall provide a quarterly briefing
in person or via video teleconference, as proposed by the contractor to the
Regional Director and TMA staff on the contractor’s ongoing internal quality
improvement program. The contractor shall also comply with the Clinical Quality
Management requirements of the TRICARE Operations Manual, Chapter 7, Attachment
10, National Quality Forum, “Serious Reportable Events in Healthcare”; and the
vulnerability assessment requirements of the TRICARE Operations Manual, Chapter
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C-7.25.1. Annually, the Government will measure selected HEDIS-like (Health Plan
Employer Data and Information Set) measures to compare the performance of the
Military Health System with health plans reporting HEDIS measures. Annually, the
contractor shall assist the Regional Director in evaluating the MHS’ success,
and in identifying the causes for successes and reasons for the MHS achieving
results less than the civilian sector. Annually, the contractor shall assist the
Regional Director in the development of a comprehensive plan for increasing the
MHS’ success in achieving HEDIS success rates when compared to the commercial
sector. The contractor shall dedicate highly knowledgeable and skilled personnel
to both the evaluation of performance results and the creation of plans to
achieve excellence when the MHS is compared to the best commercial health plans.
It is anticipated that a minimum of one FTE will be required.

C-7.26. The Government intends to establish a presence at the Prime contractor
location and at each first tier subcontractor location. The Government
representative(s) shall be included in all TRICARE meetings and activities
related to the operation of this contract with the exception of meetings
discussing the contractor’s business strategy, and shall be provided every
opportunity to represent the Government’s interest. The Government
representative shall also be provided with all management reports and plans
related to the day-to-day and long-term delivery of services in conjunction with
this contract. The Government representative shall not have a vote in the
contractors’ determinations; direct the contractors’ actions, supervise
contractor employees, or be assigned work by the contractors. The Government
representative will be designated a Contracting Officer’s Representative per
Section G or I.

C-7.27. The prime contractor and each first tier subcontractor shall provide
full-time office space and support services to the Government representative(s)
equivalent to and in the proximity of the senior management of the contractor or
first tier subcontractor. This shall include a fully-functional office including
a private, lockable office; all appropriate office furnishings and supplies
comparable to the senior managers of the contractor/subcontractor; a personal
computer with e-mail and World Wide Web access; printer; telephone instrument
with unlimited capability; and photocopy or access to photocopy equipment.

C-7.28. The contractor shall locate a senior executive with the authority to
obligate the contractor’s resources within the scope of this contract within a
fifteen-minute drive of the TRICARE Regional Administrative Contracting
Officer’s office.

C-7.29. The contractor shall comply with the Appeals and Hearings Process
contained in the TRICARE Operations Manual, Chapter 13.

C-7.30. The contractor shall collaborate with the Regional Director and MTF
Commanders to ensure the most efficient mix of health care delivery between the
MHS and the contractor’s system within the area. Collaboration includes, but is
not limited to, right of first refusal for referrals for all or designated
specialty care, including ancillary services; Centers of Excellence (COE); and
coordinated preventive health care. The Memorandum of Understanding (drafted by
the contractor) between each Regional Director, MTF Commander, and the
contractor shall be in writing and must be approved by the Contracting Officer
and the Regional Director. The contractor shall initiate discussions related to
and prepare the collaborative agreement. (See the TRICARE Operations Manual,
Chapter 16) C-7.30.1. The contractor shall develop and implement, in conjunction
with each MTF and the Regional Director, a contingency program designed to
ensure that health care services are continuously available to TRICARE eligible

 

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DESCRIPTION/SPECIFICATIONS/WORK STATEMENT

 

beneficiaries as the MTFs respond to war, operations other than war,
deployments, training, contingencies, special operations, et cetera. The
documented contingency program shall be provided to the Regional Director 6
months following the start of option period one and updated annually.

C-7.31. The contractor shall participate in each MTF’s Installation Level
Contingency Exercise twice each year. The purpose of the exercise is to test the
contingency program under a variety of situations and to provide information
from which the contractor’s contingency program shall be updated. The contractor
shall also participate in Regionally Coordinated Table Top Contingency Exercises
twice each year.

C-7.32. The contractor shall implement the contingency program at any or all
locations within forty-eight (48) hours of being notified by the Regional
Director that a contingency exists.

C-7.33. The contractor shall implement processes and procedures that ensure full
compliance with the President’s Advisory Commission on Consumer Protection and
Quality in the Health Care Industry’s Consumer Bill of Rights and
Responsibilities. (See http://www.hcqualitycommission.gov/.)

C-7.34. At midnight Pacific Time on the last day of health care delivery under
this contract, the contractor shall assign its rights to the telephone number
serving the region to the incoming MCS contractor.

C-7.35. The contractor shall provide information management and information
technology support as needed to accomplish the stated functional and operational
requirement of the TRICARE program and in accordance with the TRICARE Systems
Manual and the MHS Enterprise Architecture (See
http://www.tricare.mil/architecture).

C-7.36. Personnel Security. The contractor shall meet the requirements of DoD
5200.2-R “Personnel Security Program”, January 1987 and the TRICARE Systems
Manual for employees and subcontractor employees that require access to
Government information technology (IT) systems or access to
contractor/subcontractor IT systems that process DoD Sensitive but Unclassified
(SBU) information and are directly connected to Government IT systems and/or to
those contractor/subcontractor personnel who have access to or process DoD
sensitive information. The contractor shall not allow access unless the
requirements of DoD 5200.2-R Appendix 6 of June 2002 (draft) are met. The
contractor shall identify contractor and subcontractor positions that require
access under these requirements at contract initiation and update whenever
changes are necessary identifying the number, type, and location of the
positions.

C-7.36.1. System Security. The contractor shall comply with the DoD
accreditation process for safeguarding DoD information accessed, maintained and
used in the operation of systems of records under this contract as describe in
TSM Chapter 1, Section 1.1. The contractor shall cooperate with and assist the
Government’s Information Assurance evaluation team during all phases of the
accreditation process.

C-7.36.2. The contractor shall comply with DoD Directive 8500.1, Information
Assurance, Privacy Act Program Requirements (DoD 5400.11), and Personnel
Security Program Requirements (5200.2-R). The contractor shall also comply with
the Health Insurance Portability

 

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and Accountability Act of 1996 (HIPAA) requirements, specifically the
administrative simplification provisions of the law and the associated rules and
regulations published by the Secretary, Health and Human Services (HHS) and the
published TMA implementation directions. This includes the Standards for
Electronic Transactions and the Standards for Privacy of Individually
Identifiable Health Information. It is expected that the contractor shall comply
with all HIPAA-related rules and regulations as they are published and as TMA
requirements are defined (including security standards, identifiers for
providers, employers, health plans, and individuals, and standards for claims
attachment transactions).

C-7.36.3. The contractor shall ensure that all electronic transactions, for
which a standard has been named, comply with HIPAA rules and regulations and TMA
requirements. The Standards for Electronic Transactions apply to all health
plans, all health care clearinghouses, and all health care providers that
electronically transmit any of the electronic transactions for which a standard
has been adopted by the Secretary, HHS. Electronic transmission includes
transmission using all media, even when the transmission is physically moved
from one location to another using magnetic tape, disk or CD media. Transmission
over the Internet, Extranet, leased lines, dial-up lines and private networks
are all included. Transmissions of covered data content via telephone
conversations, fax machines, and voice response systems are not covered by the
Standards for Electronic Transactions; however privacy and security requirements
apply to these transmissions. Health plans and other covered entities conducting
transactions through business associates must assure that the business
associates comply with all HIPAA requirements that apply to the health plans or
covered entities themselves.

C-7.37. The contractor shall furnish the DoD TRICARE Information Center and all
Health Benefits Advisors and Beneficiary Counseling and Assistance Coordinators
located in each region with read only access to claims data. The contractor
shall provide training and ongoing customer support for this access.

C-7.37.1. The contractor shall provide unlimited read-only off-site electronic
access to all TRICARE related data maintained by the contractor. Minimum access
shall include two authorizations at each MTF, two authorizations at each Surgeon
General’s Office, two authorizations at the Regional Director’s Office, two
authorizations at Health Affairs, two authorizations at TMA-Washington, two
authorizations at TMA-Aurora, two authorizations for each Intermediate Command
listed in Attachment 9, and authorization for each on-site Government
representative. The contractor shall provide training and ongoing customer
support for this access.

C-7.38. The contractor shall coordinate its activities to establish enrollment
protocols to effect the optimum enrollment mix and numbers in the MTFs for
beneficiaries living within TRICARE Prime areas. The contractor will follow MTF
guidelines for assigning MTF PCMs.

C-7.39. The contractor shall meet with each Regional Director and each MTF in a
collaborative and partnering manner to ensure balanced specialty workloads using
the contractor’s referral protocols with the MTF as the first referral site. The
contractor shall provide each MTF with referral information concerning any MTF
enrollee within 24 hours of a referral.

C-7.40. The contractor shall comply with the provisions of the TRICARE
Operations Manual, Chapter 7, regarding coordination and interaction with the
National Quality Monitoring Contract (NQMC) contractor(s).

 

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C-7.41. The contractor shall provide, no less than weekly, a listing of
beneficiaries who have other health insurance (OHI) and the details of that
insurance to the Pharmacy Data Transaction Services (PDTS) – the MHS’ Pharmacy
data repository – contractor. The form and transmission protocol shall be
mutually agreeable to each, and approved by TMA.

C-7.42. The contractor shall provide pharmaceuticals to beneficiaries in
situations where the pharmaceuticals are not obtained from a retail pharmacy and
consistent with the coverage usually provided under an outpatient pharmacy
benefit. Pharmaceuticals obtained by a beneficiary from a retail pharmacy, the
TRICARE Mail Order Pharmacy, or from specialized pharmacies as a component of
the consolidated retail pharmacy benefit are not the responsibility of the
contractor.

C-7.43. The contractor shall have an active provider education program designed
to enhance the provider’s awareness of TRICARE requirements, to include emphasis
on achieving the leading health care indicators of Healthy People 2010, and
encourage participation in the program.

C-7.44. The contractor shall support all initiatives in support of
Behavioral/Mental Health program. The contracting officer will issue a task
order with a statement of work describing what is required to support each
initative.

C-7.45. The contractor shall provide Smoking Cessation Triage Services

C-7.45.1. The contractor shall provide toll-free telephone based smoking
cessation referral services in accordance with best commercial practices. Each
smoking cessation contact representative shall be trained to possess basic
familiarity with and understanding of the processes or stages of smoking
addiction and cessation and the ability to adequately triage callers and
recommend appropriate treatment resources. Services shall be available to
eligible beneficiaries via a tollfree telephone line. Beneficiaries shall be
advised when calling of the availability of additional web based information and
interactive chat services that can be accessed via the Government’s web site
http://www.ucanquit2.org

C-7.45.2. The contractor shall provide a toll-free telephone service to assist
eligible beneficiaries in obtaining resources to quit smoking. The line shall be
available to all non-Medicare eligible beneficiaries who are current smokers or
former smokers concerned about relapse.

C-7.45.3. Toll-free telephone services shall be provided to all eligible
beneficiaries 24 hours daily, including weekends and holidays.

C-7.45.4. The contractor shall include in its existing website, links to the
Government’s tobacco cessation website http://www.ucanquit2.org. The contractor
shall also indicate that this site provides online instant messaging (chat)
technology as a real-time alternative to the telephonic toll-free line. The
contractor shall further indicate that this web based functionality is available
year-round, 24 hours daily, including weekends and holidays.

C-7.45.5. The contractor shall provide via the U.S. mail smoking/tobacco
cessation materials to those eligible beneficiaries who are unable to access the
web-based support materials.

 

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C-7.45.6. In providing smoking cessation triage services, the contractor shall
follow the “5 A’s” model (Ask, Advise, Assess, Assist, Arrange).

C-7.45.6.1. Each caller will be asked about their current smoking habit.

C-7.45.6.2. Each caller will be urged in a strong, clear and personalized manner
to quit.

C-7.45.6.3. Each caller will be assessed as to their current willingness to make
a quit attempt at the present time as well as their current level of tobacco
dependence.

C-7.45.6.4. Based on the information received, each caller will be aided in
their quit attempt by offering them a quit plan and then as appropriate, assist
and/or recommend the beneficiary contact a TRICARE authorized provider who can
further assist them in carrying out that plan.

C-7.45.6.5. Arrange for each caller to receive basic educational materials on
smoking/tobacco cessation in order to support their quit attempt.

C-7.45.7. The contractor shall assist TMA’s Office of Communications and
Customer Service (C&CS) in the development of marketing materials to alert the
beneficiary population of the contractor’s toll-free smoking cessation services.
The contractor shall provide C&CS with the toll-free phone number by which
beneficiaries attain access to the smoking quit line 30 days prior to the
initial start of service. This information may be included in quarterly
newsletters published by TRICARE Managed Care Support contractors, published on
TMA’s web site, or included in emailed/mailed packages to beneficiaries.

C-7.45.8. The contractor shall verify eligibility of each beneficiary through
the Defense Enrollment Eligibility Reporting System (DEERS) prior to providing
any telephonic or web-based chat services.

C-7.45.9. The contractor shall provide the following reports:

C-7.45.9.1. The contractor shall submit a quarterly report listing the staff
providing services during the previous three months and listing their completed
training. The listing shall include the course title, course dates, length of
the course, and cumulative hours the individual has completed to date. The
report shall be submitted not later than ten calendar days following the
reported quarter.

C-7.45.9.2. The contractor shall submit a monthly report with the toll-free
telephone line utilization rate and other data including but not limited to,
accessibility metrics, demographics, number of callers, beneficiary category,
number of telephonic contacts, time and length of calls. The report shall be
submitted not later than ten calendar days following the reported month.

C-7.45.9.3. (Reserved)

C-7.45.10. The contractor shall deliver written materials to beneficiaries, upon
request, who are not able to obtain them via the Internet. These materials shall
be sent via first-class mail within three working days of request (reference
paragraph C-7.46.5).

 

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SECTION F

DELIVERIES OR PERFORMANCE

 

F.1. 52.242-15 STOP-WORK ORDER (AUG 1989)

(Reference 42.1305)

F.2. 52.242-15 I STOP-WORK ORDER (AUG 1989) – ALTERNATE I (APR 1984)

Reference 42.1305)

F.3. Period of Performance

a. Base Period (Transition costs only): 1 September 2003 – 31 October 2004

Option Period I (All costs other than transition costs): 1 April 2004 – 31 March
2005

If exercised, Options II through the end of the contract:

Option Period II: 1 April 2005 – 31 March 2006 Option Period VI 1 April 2009 –
31 March 2010

Option Period III: 1 April 2006 – 31 March 2007 Option Period VII 1 April 2010 –
30 September 2010

Option Period IV: 1 April 2007 – 31 March 2008 Option Period VIII 1 October 2010
– 31 March 2011

Option Period V: 1 April 2008 – 31 March 2009 Option Period IX 1 April 2011-
31 March 2012

b. Contract Transition

The transition period is 10 months in duration as depicted below.

(1) Base Period

Former Region 3 and 4: 1 October 2003 – 31 July 2004

Former Region 6: 1 January 2004 – 31 October 2004

F.4. Geographic Area of Coverage

The contract shall be referred to as the Managed Care Support (MCS), South . It
will require development, implementation and operation of a health care delivery
and support system for TRICARE and other MHS beneficiaries residing in the
states of Alabama, Florida, Georgia, Mississippi, South Carolina, Tennessee
(excluding the zip codes in the Fort Campbell, Kentucky catchment area),
Louisiana, Oklahoma, Arkansas, and major portions of Texas. These geographic
areas are hereinafter referred to as the South Contract and defined by zip code
in Attachment 8. The contractor shall be responsible for complying with all
Continued Health Care Benefit Program (CHCBP) requirements and fulfilling the
overseas requirements of the European, Pacifica and Latin American/Canada
regions.

F.5. Reports and Meetings

All reports shall be submitted electronically in a mutually agreeable format and
in a secure manner to the Government unless otherwise specified.

a. Evolving Practices, Devices, Medicines, Treatments and Procedures

The Contractor shall be responsible for routinely reviewing the hierarchy of
reliable evidence, as defined in 32 C.F.R. 199.2, and bringing to the
Government’s attention drugs, devices, medical treatments, or medical procedures
that they believe have moved from unproven to proven. This shall be done on a
calendar quarter basis in a written report to the Government. Accompanying the
report will be the reliable evidence substantiating that the drugs, devices,
medical treatments, or medical procedures have moved from unproven to proven.

b. Start-Up Transitions

 

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DELIVERIES OR PERFORMANCE

 

(1) Attend Post-Award Conference

Quantity: 1

Time of Delivery: Within 30 calendar days after contract award.

(2) Attend Transition Specifications Meeting – Incoming and Submit Transition
Plan

Quantity: 1

Time of Delivery: When scheduled by the Government

(3) Transition Plan

Quantity: 1

Time of Delivery: 15 calendar days after contract award

c. Transition In (on-going through healthcare delivery)

(1) Schedule and host Interface Meetings (TRICARE Operations Manual, Chapter 1,
Section 8)

Quantity: 1

Time of Delivery: Within 30 calendar days after contract award

(2) Systems Documentation

Quantity: 1

Time of Delivery: 30 calendar days prior to the start of health care delivery

(3) Systems Interconnections

Quantity: 1

Time of Delivery: 120 calendar days prior to start of health care delivery

(4) TRICARE Duplicate Claims System

Quantity: 1

Time of Delivery: 60 calendar days prior to the start of health care delivery

(5) Executed Collaborative Agreements with MTF Commanders

Quantity: one per MTF

Time of Delivery: 60 calendar days prior to the start of health care delivery

(6) Memorandum of Understanding regarding marketing and education with the
Government

Quantity: 1

Time of Delivery: 60 calendar days after contract award

(7) Enrollment Plan

Quantity: 1

Time of Delivery: 90 calendar days prior to the start of each health care
delivery period

(8) DEERS: New enrollment applications

Quantity: 1 lot

Time of Delivery: 40 calendar days prior to the start of healthcare delivery

(9) Enrollment reports

Quantity: 1

Time of Delivery: Within 30 calendar days following the start of health care
delivery and 10 calendar days following the close of each month, through the
seventh month following the start of health care delivery

 

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DELIVERIES OR PERFORMANCE

 

(10) Contractor File Conversion and Testing

Quantity: 1

Time of Delivery: 30 calendar days following receipt of the magnetic tape files
from the outgoing contractor

(11) Weekly History Updates – Incoming

Quantity: 1

Time of Delivery: 120 calendar days prior to the start of health care delivery,
to continue for 180 calendar days after the start of health care delivery

(12) Network Implementation Plan

Quantity: 1 lot

Time of Delivery: 90 days after contract award

(13) Network Adequacy Reports

Quantity: 1 lot

Time of Delivery: 30 calendar days after contract award and every 30 calendar
days thereafter through the first 6 months of the health care delivery period.
Thereafter quarterly throughout the life of the contract.

Distribution: one copy to the Contracting Officer and one copy to the Regional
Director

(14) Ordering of TRICARE marketing and educational materials from the Government

Quantity: 1 lot

Time of Delivery: 180 calendar days prior to the start of health care delivery
and by the 90th calendar day for all subsequent contract periods

(15) Distribution of education and marketing materials

Quantity: 1 lot

Delivery: No earlier than 60 calendar days and no later than 30 days prior to
the start of health care delivery

Distribution: To be sent to beneficiaries and network providers

(16) TRICARE Service Center Operations

Quantity: 1

Time of Delivery: 40 calendar days prior to the start of health care delivery

(17) Public Notification Program

Quantity: 1

Time of Delivery: No later than 45 calendar days prior to the start of health
care delivery

(18) Web-based Services

Quantity: 1

Time of Delivery: No later than 15 calendar days prior to the start of health
care delivery

(19) Incoming Contractor Weekly Status Report

Quantity: 1

Time of Delivery: Beginning 20 calendar days after contract award through the
180th calendar day after the start of health care delivery

 

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DELIVERIES OR PERFORMANCE

 

(20) Contingency Program

Quantity: 1

Time of Delivery: For 85% of the MTFs-within 3 months following the start of
option period I; 100% within 6 months following the start of option period I.
Update by the 60thcalendar day of subsequent option periods II through IX.
Option Period VIII is excluded.

(21) Internal Quality Management/Quality Improvement Program

Quantity: 1

Time of Delivery: Initial submission within 30 calendar days of award;
subsequent submissions due to updates or changes to the program are to be
submitted within 10 calendar days of the update or change

(22) Internal Quality Management/Quality Improvement Reports

Quantity: 1

Time of Delivery: 10 calendar days following the reported month of problems
identified and corrective actions planned/initiated. The requirement to maintain
and update the program will continue for the entire period of health care
delivery under the contract.

(23) Previously deleted.

(24) Account Receivable Report

Quantity: Monthly

Time of Delivery: 2nd workday of subsequent month after 1st month of Health Care
Delivery

Contract Reference: TOM Ch 3, Sec 10, 2.0

Distribution: Original to TMA CRM, copy to the Contracting Officer, COR

(25) Accounts Receivable – Amounts Written Off Detail Report

Quantity: Monthly

Time of Delivery: 5th workday of subsequent month

Contract Reference: TOM Ch 3, Sec 10, 2.1

Distribution: Original to TMA CRM, copy to the Contracting Officer, COR

(26) Accounts Receivable – Debts Transferred to TMA Detail Report

Quantity: Monthly

Time of Delivery: 5th workday of subsequent month

Contract Reference: TOM Ch 3, Sec 10, 2.1

Distribution: Original to TMA CRM, copy to the Contracting Officer, COR

(27) Accounts Receivable – Ending Outstanding Receivables Detail Report

Quantity: Monthly

Time of Delivery: 5th workday of subsequent month

Contract Reference: TOM Ch 3, Sec 10, 2.1

Distribution: Original to TMA CRM, copy to the Contracting Officer, COR

(28) Smoking Cessation Triage Quarterly Report

Time of Delivery: Ten calendar days after the end of the reported quarter

Contract Reference: C-7.45.9.1.

Distribution: Contracting Officer’s Representative and Healthcare Operations

 

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DELIVERIES OR PERFORMANCE

 

Division

(29) Smoking Cessation Triage Monthly Telephone Report

Contract Reference: C-7.45.9.2.

Time of Delivery: Ten Calendar days after the end of the reported month

Distribution: Contracting Officer’s Representative and Healthcare Operations
Division

d. Transition Out

(1) Schedule Transition Specification Meeting – Outgoing

Quantity: 1

Time of Delivery: 15 calendar days following contract award of the successor
contractor

(2) Transition Out Plan

Quantity: 1

Time of Delivery: 15 calendar days following the Transition Specification
Meeting – Outgoing

(3) Transition Out of the Duplicate Claims System

Quantity: 1 lot

Time of Delivery: In accordance with the transition schedule

(4) Transfer of Contractor File Specifications

Quantity: 1 lot

Time of Delivery: 3 calendar days following contract award

(5) Transfer of ADP Files (Electronic)

Quantity: 1 lot

Time of Delivery: 15 calendar days following the Transition Specifications
meeting (unless otherwise negotiated by the incoming and outgoing contractors)

(6) Transfer of Provider Information

Quantity: 1 lot

Time of Delivery: At the direction of the Contracting Officer following the date
of successor contract award (unless otherwise negotiated at the Transition
Specifications meeting)

(7) Weekly History Updates – Outgoing

Quantity: 1

Time of Delivery: Beginning 120 calendar prior to the start of health care
delivery until completed in accordance with the transition schedule

(8) Weekly Status Report

Quantity: 1

Time of Delivery: Beginning 20 calendar days following the Transition
Specifications Meeting unless otherwise notified by the Contracting Officer

(9) Transfer of Non-ADP Files

Quantity: 1 lot

Time of Delivery: In accordance with the transition schedule

 

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DELIVERIES OR PERFORMANCE

 

(10) Claims processing and adjustments

Quantity: 1 lot

Time of Delivery: 180 calendar days following the start of health care delivery

 

(11) Correct all Edit Rejects

Quantity: 1 lot

Time of Delivery: 210 calendar days following the start of health care delivery

 

(12) Phase-Out of MTF Interfaces Revised Plan

Quantity: 1

Time of Delivery: 15 calendar days after the Transition Specifications Meeting

 

(13) Transfer of Enrollment Applications

Quantity: 1 lot

Time of Delivery: 40 calendar days after the start of health care delivery of
the successor contract award

e. Benchmark Testing

Claims Systems Demonstration (Benchmark)

Quantity: 1 for all conus locations and 1 for overseas, if each successful

Time of Delivery: 120 calendar days prior to the start of health care delivery
for legacy areas 3 and 4

f. Resource Sharing

(1) Monthly Financial Analysis

Quantity: One for each resource sharing agreement

Time of Delivery: Monthly

(2) Resource Sharing Plan

Time of Delivery: Within 180 days after contract award

(3) Transitioning of Resource Sharing Agreements

Time of Delivery: Within 15 calendar days of the Transition Specifications
Meeting

 

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SECTION G

CONTRACT ADMINISTRATION DATA

 

G-1.

The Procuring Contracting Officer (PCO) for this contract is:

Contracting Officer

Office of the Assistant Secretary of Defense for Health Affairs

TRICARE Management Activity

Contract Management Division

16401 East Centretech Parkway

Aurora, CO 80011-9066

G-2. Regional Office Contracting Officer (ROCO) and Contracting Officer’s
Representative (COR)

Subsequent to contract award, the Procuring Contracting Officer (PCO) will
appoint one or more ROCOs and one or more CORs who will be designated certain
contract administration responsibilities in that region. The contractor shall
work directly with the ROCO(s) and COR(s) on those matters delegated to them.
The ultimate responsibility for overall administration of this contract rests
with the PCO, TRICARE Management Activity, Aurora, Colorado. The contractor will
be provided copies of all delegation letters.

G-3. Contract Payment

a. Contract Payments Disbursed by TMA Aurora

(1) General

(a) The basis for payment to the contractor shall be the prices specified in
Section B of this contract.

(b) Methods of Payment to the Contractor

[1] All payments made by the Government will be made by electronic funds
transfer (EFT).

[2] Non-underwritten benefit payments will be facilitated by permitting the
contractor to withdraw funds directly from the Federal Reserve. These draws must
be based on approved contractor payments clearing the contractor’s bank account
(less related deposits) as described in Chapter 3 of the TRICARE Operations
Manual (TOM). TED data submissions for non-underwritten benefit payments shall
be grouped into TED Vouchers by the ‘Batch/Voucher ASAP Account Number’ (defined
in TRICARE Systems Manual, Chapter 2, Section 2.2) assigned by TMA Contract
Resource Management (CRM).

(2) Invoices

(a) TEDs Supported Invoices. Submission of TEDs to TMA will be considered
submittal of an invoice.

(b) Non-TEDs Supported Invoices

 

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CONTRACT ADMINISTRATION DATA

 

[1]Electronic invoices are the preferred method of submittal. The contractor can
submit electronic invoices by accessing the TMA provided invoicing website, when
available. The TMA website will provide electronic forms (e.g., Standard Form
1034) that can be completed and submitted on-line. Supporting documentation may
be attached electronically.

[2] Non-TEDs supported invoices for Behavioral/Mental Health Initiatives task
orders shall also be submitted to the TRICARE Regional Office Contracting
Officer for approval prior to payment. Copies of the invoices shall still be
submitted to TRICARE Management Activity – Aurora in accordance with the
preceding paragraph.

(c) Non-TEDs supported invoices shall be sent to the Procuring Contracting
Officer with copies provided to Resource Management and the Contracting
Officer’s Representative (COR).

(d) Payments made on Non-TEDs supported invoices are considered interim
payments.

(3) Payments

(a) Claims Processing CLINs – Electronic Claims and Paper Claims (see TOM
Chapter 3, Section 9)

[1] Claims rate processing payments are based on TEDs being accepted
provisionally or clearing all edits, whichever comes first. These are identified
in the TEDs manual. Payments will be based on a claim rate times the number of
claims clearing edits. Payments for claims the contractor receives within 120
calendar days following the cessation of health care delivery (for services
rendered during the health care delivery period) are made based on the claim
rate in effect during the health care delivery period immediately preceding
transition-out. Since all claims must be processed within 180 calendar days, the
Government will not pay the outgoing contractor the health care or
administrative cost associated with claims not processed to completion within
180 calendar days from the cessation of health care delivery.

[2] Payment terms. Claims processing payments are paid 30 days from the date of
the cycle that included the accepted or cleared TEDs. If cycle processing is
delayed by TMA, this period will be shortened to account for TMA downtime.

[3] No separate invoices are required for claims processing payments based on
the automated processes tied to claims clearing TEDs edits. However, invoices
are required for non-automated payment requests, unless otherwise instructed by
the Contracting Officer. If TEDs is not operating normally, see TOM Chapter 3
Section 9 paragraph 1.2.

[4] Claims processing payments procedures are the same for both underwritten and
non-underwritten benefit claims.

(b) TRICARE Service Centers (TSCs). Invoice on a monthly basis for an entire
month. Payment will be made 30 days after the end of the month invoiced or 15
days after the invoice has been received by TMA CRM and certified by an
authorized Government official, whichever is later.

(c) Per Member per Month (PMPM). Invoice on a monthly basis for an entire month.
Payment will be made 30 days after the end of the month invoiced or 15 days
after the invoice has been received by TMA CRM and certified by an authorized
Government official, whichever is later.

 

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(d) Disease Management – Cost Reimbursement SLINs 0105AA, 0203AA, 0303AA,
0403AA, 0503AA, 0603AA, 0703AA, 0803AA, 0903AA, and 0903AB. Invoices shall
separately identify costs associated with C-7.7.1.1. from those associated with
C-7.7.1.2. Unless otherwise directed by the Contracting Officer, interim
invoices should be submitted monthly to Defense Contract Audit Agency (DCAA) for
approval with copies provided to RM and the CO. Final voucher will be submitted
to the CO with a copy provided to RM and the COR.

(e) Disease Management – Fixed Fee. . Unless otherwise directed by the PCO,
submit interim vouchers monthly to DCAA with copies provided to the PCO, RM and
the COR.

(f) Award Fee. Payment will be made by TMA following determination of the Award
Fee amount as specified in the corresponding clause in Section H.

(g) Contracting Officer Directed Travel. Submit invoice, with supporting
documentation, following completion of travel. Supporting documentation shall
include original receipts for airline tickets, hotels, rental cars and any
miscellaneous expense over $75.00.

(h) Transition-In. Submit invoices on a monthly basis.

 

          Area  3/4   Area 6   Monthly Payment

2003

   October    ****     ****    November    ****     ****    December    ****    
****

2004

   January    ****   ****   ****    February    ****   ****   ****    March   
****   ****   ****    April    ****   ****   ****    May    ****   ****   ****
   June    ****   ****   ****    July    ****   ****   ****    August    ****  
****   ****    September    ****   ****   ****    October    ****   ****   ****

(i) Transition-Out. Submit invoice following completion of work.

(j) Underwritten Health Care Costs.

[1] General Description. Payment of underwritten health care cost claims will be
made to the Contractor within five federal business days after the associated
TEDS records are accepted provisionally or clear all edits, whichever comes
first.

[2] Payment under this process are considered interim payments.

[3] The contractor will process underwritten health care claims and pay the
provider or beneficiary from the contractor’s account.

 

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[4] The associated underwritten health care cost TEDS will be submitted to TMA
and will be considered submittal of an invoice. If some or all of the TED
records fail edits, they will be returned to the contractor for corrective
action. Those records that pass, at a minimum, validity edits will be included
in an automated report which includes both amounts to be paid by the Government
to the Contractor and amounts to be paid by the Contractor to the Government.
TED data submissions for underwritten cost payments shall be grouped into TED
Vouchers by contract line item number/fiscal year/region (contractor will use
‘Batch/Voucher ASAP Account Number’ (defined in the TRICARE Systems Manual,
Chapter 2, Section 2.2) field in the voucher header to identify the contract
line item number, the fiscal year funding associated with the line item, and the
contract region. Batch/Voucher ASAP Account Number format for underwritten
healthcare vouchers is: contract line item number identified in Section B of the
contract (six positions), fiscal year of funding on the contract line item
number (one position, NOTE: all underwritten contract line item numbers will
have at least two fiscal years of monies associated with them), and a single
digit region indicator (W=West, N-North & S=South contract)(e.g. if ASAP number
= 1001AA4W then: CLIN=1001AA, fiscal year = 2004, & Region = West). For the
period of October 1, 2006 through the end of the contract, all financially
underwritten benefit payments must use BATCH/VOUCHER ASAP account number
containing the underwritten CLIN (positions 1 through 6 of ASAP).

[5] TMA will disburse payment to the contractor based on the automated TED
report. If the TEDS are credits which will result in a payment to the
Government, collection will be made based on the same terms as payment for that
respective contract line item number. (Credit must be applied back to the same
sub-CLIN from which it came.)

[6] Submission of TEDS will be considered submission of an invoice. If TEDs is
not operating normally, notification will be received from the Contracting
Officer and the contractor may invoice for reimbursement of underwritten
payments using a mutually agreed to method. Once TEDs is processing, all claims
that have been held up will be processed and the exact amounts due to the
contractor will be determined and will be offset by the disbursements made by
the Government via the temporary public voucher process.

(k) Non-Underwritten Benefits

[1] General Description. Payment to the contractor for benefit payments will be
facilitated by allowing the Contractor (through the Contractor’s financial
institution) to draw money from the designated Federal Reserve Bank. These draws
may only be done to cover payments that have been approved for release by TMA
and are clearing the contractor’s financial institution on the day the draw is
being accomplished. These draws must be reduced by deposits so the bank account
will have close to a zero dollar balance at the end of each day.

[2] The contractor shall comply with the detailed instructions for these
transactions outlined in the TOM, Chapter 3. Advance payments are not allowed.
All payments must be for processed claims and approved prior to payment being
issued. Unapproved payments will be immediately collected and subject the
Contractor to penalties.

[3] TMA will disburse payment to the contractor based on the automated TED
report. If the TEDS are credits which will result in a payment to the
Government, collection will be made based on the same terms as payment for that
respective contract line item number. (Credit must be applied back to the same
sub-CLIN from which it came).

 

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[4] Types of Non-Underwritten Benefits

(i) TEDs Related Benefit Payments. These are payments to a provider or
beneficiary supported by a TEDs submission to TMA. See TOM Chapter 3, Section 3.
See Section H.1.a.(1) for a list of non-financially underwritten claims.

(ii) CAP/DME and other Non-TEDs Routine Payments. These are payments that cannot
be supported by TEDs because they are based on more than one patient. See TOM
Chapter 3, Section 4.

(iii) Non-Routine Payments and Vouchers. These are payments that are rare,
unusual and will only be approved by the Contracting Officer due to exceptional
circumstances. These are transactions that must be done manually. If a
transaction can be done through TEDs or other standard procedures they must be
done by those procedures – see TOM Chapter 3, Section 5.

(iv) Residual Claims. These are claims for service provided prior to the start
of this contract. See TOM Chapter 1, Section 8.

[5] Claim processing payments will be made by TMA for TRICARE Europe active duty
service member healthcare claims being paid by DFAS Europe.

(l) Benefit payments for TRICARE Europe active duty claims will be billed to
DFAS Europe per instructions in the TRICARE Policy Manual, Chapter 12,
Section 11.1, IV, 1.d(2).

(m) Underwriting Fee Payments

[1] Partial underwriting fee payments will be determined and paid in accordance
with Section H.2.

[2] Interim underwriting fee payments will be determined and paid in accordance
with Section H.3.

[3] Final fee will be determined and paid in accordance with Section H.1.

(n) Performance Guarantees. Collections will be made by withholding the
determined amount from the next payment to the contractor.

b. Contract Payments Related to Military Treatment Facility (MTF) Enrollees.

(1) Underwritten payments will be made for MTF Prime Enrollees in accordance
with G-3.a.(3)(j) above. Nonunderwritten payments will be made for MTF Prime
Enrollees in accordance with G-3.a.(3)(k) above.

(2) Resource Sharing Task Order: The paying activity, invoicing and payment
details will be specified in each Resource Sharing Agreement task order.

(3) Fee-for-Service Resource Sharing: Terms will be specified in each agreement.
Notwithstanding TRICARE Operations Manual, Chapter 16, Section 2, Paragraph 3.1,
task

 

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orders are not applicable for fee-for-service Resource Sharing Agreements. See
TRICARE Systems Manual, Chapter 2, Section 1.1, Paragraph 8 for process for
reporting to TMA.

c. Clinical Support Agreement Program Invoices and Payments. Invoice and payment
instructions will be identified on each individual task order.

G-4. ORDERING ACTIVITY

The following describes the ordering authority and procedures for the
requirements contract line item numbers (CLINs) of this contract, which are the
Per Member per Month and the Claims processing CLINs, and for the
indefinite-quantity CLINs of this contract, which are the Clinical Support
Agreement Program CLINs, Resource Sharing Agreement CLINs and Behavioral/Mental
Health Initiatives CLINs.

Ordering Authority. The TMA-Aurora Procuring Contracting Officer (PCO) has
authority to issue delivery orders or task orders under the requirements CLINs
of this contract. Any authorized contracting officer in support of the military
health system (MHS) has the authority to issue task orders under the
indefinite-quantity Clinical Support Agreement CLINs of this contract. The
Contracting Officer located at the Regional Office has the authority to issue
task orders under the indefinite-quantity Resource Sharing CLINs and the
Behavioral/Mental Health Initiative CLINS.

Ordering Procedures for the requirements CLINs. The PCO will issue delivery
orders or task orders on DD Form 1155, Order for Supplies or Services. Orders
may be placed by facsimile transmission, mail, or courier.

Ordering Procedures for the indefinite-quantity CLINs. Orders placed under the
indefinite-quantity CLINs may be issued on DD Form 1155, Order for Supplies and
Services. Orders for Resource Sharing Program Agreements may be on a
non-personal services basis only. Orders for the Clinical Agreement Program may
be on a personal services basis or non-personal services basis as indicated in
TOM Chapter 16, Section 3, Paragraph 3.1.3. Task Orders issued on a personal
services basis shall comply with DOD Instruction 6025.5, entitled Personal
Services Contracts (PSCs) for Health Care Providers (HCPs), and shall contain
the information stated in part 6.3 of the same DOD Instruction. All task orders
will be performance based or receive appropriate approval in accordance with
DFARS 237.170-3. Orders may be placed by facsimile transmission, mail or
courier. A copy of the Clinical Support Agreement order shall be provided to the
contracting officer identified in block 6 of the award document (SF 26) plus the
Contracting Officer located at the Regional Office. A copy of the Resource
Sharing Agreement order shall be provided to the contracting officer identified
in block 6 of the award document (SF 26) plus the MTF who requested the
Agreement. A copy of the Behavioral Mental Health Initiative task order shall be
provided to the TMA-Aurora Procuring Contracting Officer.

G-5. MILITARY HEALTH SYSTEM (MHS) ELIGIBLE BENEFICIARIES

The Government will unilaterally determine the number of MHS eligible
beneficiaries two times each option period, except for option VII and VIII,
under the Per Member per Month contract line item numbers, once for the first
six month period and once for the seventh through twelfth month. The Government
will also make the same unilateral determination once for each option period VII
and VIII. This will be done using an average of six of the seven previous months
of

 

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eligible beneficiaries as reported by the MHS Data Repository in their monthly
“Point-In-Time Extract” as adjusted by TMA (see Attachment 4). Using the number
of MHS eligible beneficiaries, the Government will issue a delivery order for a
six month period.

G-6. MILITARY HEALTH SYSTEM (MHS) TRICARE RESERVE SELECT ENROLLED BENEFICIARIES

The Government will unilaterally determine the number of TRICARE Reserve Select
enrolled beneficiaries two times each option period, except for option periods
VII and VIII, under the TRS Per Member per Month contract line item numbers,
once for the first six month period and once for the seventh through twelfth
month. The Government will also make the same unilateral determination once for
each option period VII and VIII. This will be done using an average of six of
the seven previous months of eligible beneficiaries as reported by the MHS Data
Repository in their monthly “Point-In-Time Extract” as adjusted by TMA (see
Attachment 4). Using the number of TRICARE Reserve Select enrolled
beneficiaries, the Government will issue a delivery order for a six month
period.

 

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H.1. Contractor Financial Underwriting of Healthcare Costs

a. General Discussion

(1) The Managed Care Support (MCS) contractor will underwrite the cost of
civilian health care services (also referred to as “purchased care” which is
defined as care rendered outside the Direct Care System) provided to all CHAMPUS
eligible beneficiaries* residing in the contract area except:

– outpatient retail and mail order pharmacy services (on separate contracts)

– Active Duty/Supplemental including TRICARE Prime Remote for service members
(SM) only (family members (FMs) are underwritten by the MCS contractor)

– Continued Health Care Benefits Program (CHCBP)

– Foreign/OCONUS Claims (all)

– Medicare dual-eligible TRICARE beneficiaries (separate contract)

– Cancer/Clinical Trials (for beneficiaries enrolled prior to 4/1/2008)

– Autism Sevices Demonstration

– Capital and Direct Medical Education Costs (CDME)

– In-Utero Fetal Surgical Repair of Myelomeningocele Clinical Trial
Demonstration

– Bonus Payments in Medically Underserved Areas [Health Professional Shortage
Areas (HPSA)]

– Capitol and Direct Medical Education Costs (CDME)

– TRICARE Reserve Select

– Custodial Care Transition Program (CCTP)

– Individual Case Management Program for Persons with Extraordinary Conditions
(ICMP-PEC)

– Temporary Miltary Contingency Payment Adjustments (TMCPA)

– TRICARE Retired Reserve (TRR)

 

* CHAMPUS-eligible beneficiaries are defined as those beneficiaries that meet
the requirements in Title 10, United States Code, Chapter 55.

(2) The underwriting mechanism will consist of an underwriting fee which may be
considered to be an underwriting premium associated with the risk assumed by the
contractor. It will be subject to a fee-adjustment formula or “fee curve,” which
allows for increases or decreases inversely related to the actual costs. There
is potential for the contractor to earn a negative fee if the actual healthcare
costs for a given contract year were significantly higher than a specified
target cost for that year. The adjustment mechanism is described in the
subsequent paragraphs.

b. Administration of Financial Underwriting by Contractor

(1) This paragraph defines and explains the mechanics and the administration
process of the following:

– target healthcare cost

– target underwriting fee

– minimum and maximum fee

– formula to determine the underwriting fee within the minimum and maximum based
on the relationship of actual costs to target costs (a “fee curve”)

– actual healthcare costs

Each of these parameters is explained below.

 

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(2) Target health care cost. The target health care cost for each period of
health care delivery will be set as follows:

(a) The target cost for health care delivery in option period I under the
contract is set forth in Section B (informational line item 011001). This target
cost includes the purchased-care costs for non-TRICARE/Medicare dual-eligible
CHAMPUS beneficiaries residing in the area, whether they are enrolled with an
MTF PCM, a network PCM, or are non-enrolled. The target cost will not change
except for definitized healthcare changes or other equitable adjustment.

(b) For option period II and subsequent periods, the Government and the
contractor will negotiate the target cost before the start of each option period
for the sub-line item numbers for underwritten healthcare and incorporate them
in Section B of the contract. The target cost will be depicted at the
informational sub-line items in each option period. The negotiation process
shall begin with the submission of a proposal by the contractor not later than
the first day of the seventh month of option periods I through VI and IX, with
VII and VIII combined into one negotiation period. Once the target cost for the
next year is established, the only adjustments that would be made for that year
would be for negotiated healthcare changes, definitized healthcare change
orders, other equitable adjustment healthcare change orders issued after the
completion of the negotiations that affect the year just negotiated. If an
agreement cannot be reached on the target cost by 30 days before the start of
the next option period, the option will be exercised using the prior option
period’s target cost as specified in Section B as the estimated target cost in
Section B. A target-setting formula will be used to determine the target cost.
This formula will set the target for the option period retroactively 12 to 18
months after that option period is completed. The contractor will continue to
receive payments for underwritten health care costs as addressed in Section G,
“Payments”, and a portion of fee as addressed in Section H-2, “Partial Payment
of Underwriting Fee during Performance”.

(c) The retroactive target cost is calculated as follows:

– actual underwritten CHAMPUS health care costs in the area in the previous
option period is multiplied by the national trend factor for underwritten
CHAMPUS healthcare costs from the beginning of the previous year up to the end
of that year.

(3) Target Underwriting Fee

The term, “target underwriting fee” is equivalent to target fee. The target
underwriting fee for all option periods is established at contract award using
the contractor’s proposed dollar amount for the initial contract award as set
forth in Section B. When the parties negotiate the target cost for option period
II and/or subsequent periods, the parties will apply the fee percentage proposed
at contract award (for the relevant time period) to the negotiated target cost
to determine the actual target fee. In the event the parties are unable to
negotiate the target cost for option period II and/or subsequent periods, the
target underwriting fee will be the dollar amount established at contract award.
For option period VI through VIII, the the fall-back process is retained, but
the dollar amount for use in the “fall-back” formula established at contract
award is deterined as follows:

“For option VI, the fixed target fee to be used in the fall-back formula would
be set at the level of the option V negotiated target fee (as modified by any
subsequent change-orders not already considered in the negotiated amount)
accelerated to option VI at the same annual rate as proposed by HMHS for the
acceleration of its fixed-fee amounts from option II through option V

 

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(****). For option VII, which is a six-month option period, the fixed fee amount
would be set at half of the option VI fixed fee, accelerated at the same annual
rate for a period of 9 months (from the mid-point of option VI, to the mid-point
of option VII) ,resulting in a multiplicative factor of **** from option VI to
option VII. For option VIII,which is also a six-month option period, the option
VII fixed fee would be accelerated at the same annual rate for an additional six
months (from the mid-point of option VII to the mid-point of option VIII),
resulting in a multiplicative factor of **** from option VII to VIII. The
multiplicative factors will be rounded to four decimal places. Based on this
procedure and the current negotiated target fee for option V ($****), the
following fixed fee amounts would apply for option VI - $****, option VII -
$****and option VIII - $****. For option IX the fixed target fee to be used in
the fall back formula will be set at the level of the total option VII and VII
target fee amount of $****accelerated to option IX at an annual rate of********
for a total target fee amount of $****.

The target underwriting fee is then only adjusted by negotiated healthcare
changes, definitized healthcare change orders, or other equitable adjustments.
The parties agree to utilize the same fee percentage proposed for the initial
award in these negotiated adjustments.

(4) Minimum and Maximum Fee

The minimum and maximum are as follows:

(a) The minimum fee that may be realized by the contractor will be negative 4
percent of the target cost for each contract year.

(b) The maximum fee that may be realized by the contractor will be 10 percent of
the target cost for each contract year.

(5) Fee Determination

The underwriting fee will be determined using the fee adjustment formula as
follows:

(a) When underwritten actual costs are less than the target cost, the fee will
be the lesser of two amounts: (1) the target fee plus **** of the difference
between the target cost and the actual cost, or (2) the maximum fee amount.

(b) When underwritten actual costs exceed the target, the fee will be the
greater of two amounts: (1) the target fee plus **** of the difference between
the target cost and the actual cost (a negative number), or (2) the minimum fee
amount (a negative number).

(c) Mathematically, this formula may be expressed as:

Target Fee + ****(Target Cost – Actual Cost)

The final determination of fee will occur approximately 12 to 18 months after
the end of the option period to which it applies. This final determination will
be based on underwritten TEDs accepted by TMA through the ninth month (Option
Periods I and II) and through the sixth month (Option Periods III through the
end of the contract), after the end of the option period. However, prior to the
fee determination, the Government will determine an interim fee approximately
three months after the end of the option period to which it applies based on the
available TED data

 

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and the Government’s estimate to completion. Partial and final payment of the
fee will be conducted in accordance with H- 2 and
H-3.

(6) Actual Underwritten Healthcare Costs.

Actual underwritten costs for fee determination purposes will be measured from
TRICARE Encounter Data (TEDs) accepted by the Government, less unallowable costs
determined by audits, and estimated to completion (by the Government). The
actual costs will include resource-sharing costs and any other valid,
underwritten health-care costs not reported on TEDs, but previously agreed upon
by the Government. Healthcare cost details and clarifications include:

(a) Underwritten costs. The target and actual costs will both include all
non-TRICARE/Medicare dual-eligible CHAMPUS eligible beneficiaries enrolled with
MTF PCMs in addition to all network-enrolled and non-enrolled non-
TRICARE/Medicare dual-eligible beneficiaries.

(b) Local Military Treatment Facilities (MTFs) will have control over all
beneficiaries who enroll in TRICARE Prime with an MTF Primary Care Manager
(PCM). These enrollees will include Active Duty Service Members (ADSMs) as well
as CHAMPUS–eligible beneficiaries. Only those dollars expended for
Non-TRICARE/Medicare dual-eligible CHAMPUS beneficiaries will be accumulated as
actual healthcare costs to be compared with the target cost for the period.

(c) Enrollment Fees. Enrollment fees collected by the contractor are considered
part of the administrative price and are not considered in the determination of
the target cost or the actual cost of healthcare under the contract.

(d) Medical Management Costs. The costs of medical-management activities, such
as case management, disease management, and utilization management are not
considered as healthcare costs.

(e) Capitated Arrangements. Capitation arrangements are prohibited.

H.2. Partial Payment of Underwriting Fee during Performance

In addition to the requirements and procedures specified in this section
regarding interim and final health care underwriting fee determination, the
Government will make partial payments against the target fee as specified below.

a. During performance of each option period, the Government will pay the
contractor, on a monthly pro-rated basis, an amount equal to **** of the target
fee.

b. Interim and final determination of fee for the base period and each
subsequent option period will be in accordance with paragraphs H.1. and H.3.

H.3. Interim Fee Determination

a. If the interim fee calculation described in H.1. indicates that a positive
fee will be earned upon final determination, the Government will pay the
contractor an amount equal to 90% of the interim fee for that period. This will
be paid in a lump sum to the contractor; less any partial fee

 

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payments made for that period. The final balance for fee will be paid 12-18
months after the contract period in accordance with the final fee determination
scheme.

b. If the interim fee calculation indicates that a negative fee will be earned
upon final determination, no interim fee payments will be made. Final fee
determination will be made in accordance with paragraph H.1.

H.4. Resource Sharing

a. Resource sharing is an alternative means of satisfying the purchased-care
needs of non-TRICARE/Medicare dual eligible CHAMPUS beneficiaries and is a tool
that may be used by the Parties to reduce purchased-care and overall
underwritten expenditures. All resource sharing agreements (See the TRICARE
Operations Manual, Chapter 16) shall be cost effective to the Government and the
contractor.

b. Any allowable resource-sharing expenditure will be reimbursed and will count
as actual underwritten healthcare.

c. Although resource sharing is intended primarily to provide care to
underwritten CHAMPUS-eligible beneficiaries, when a resource sharing asset
provides care to non-underwritten beneficiaries, the costs of providing such
care is counted as actual underwritten costs for fee determination, just like
resource sharing expenditures for underwritten beneficiaries.

d. There will be no need to account for the number of Military Treatment
Facility outpatient visits or admissions enabled by resource sharing for
purposes of determining contract payments, which is separate from the progress
reports required under TRICARE Operations Manual, Chapter 15, Section 3. See
TRICARE Systems Manual, Chapter 2, Section 1.1, Paragraph 8 for process for
reporting Fee-for Service to TMA.

H.5. Allowable Health Care Cost and Payment

a. The purpose of this clause is to define reimbursable healthcare costs and to
clarify how healthcare costs apply to FAR clause 52.216-7, “Allowable Cost and
Payment”. This clause does not apply to reimbursable costs associated with the
disease management administrative services contract line item number. This
clause does not substitute any portion of, and does not make changes to FAR
52.216-7.

“Healthcare costs”, as used in this clause, are direct healthcare costs that are
underwritten by the contractor.

“Allowable cost”, as used in this clause and FAR 52.216-7 are healthcare costs
that include both provisionally and fully accepted TEDs records. These costs are
reimbursed with obligated funds dispersed under this contract. A submission by
the contractor to the TEDs system alone does not make it an allowable cost.

Non-underwritten “costs” are costs to the Government, and are not costs to the
contractor. Non-underwritten “payments” are draws of funds directly from the
Federal Reserve by the contractor or disbursed by TMA to the contractor. These
draws are not considered payments to the

 

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contractor, and not considered a reimbursement of allowable health care costs
from funds obligated on the contract.

b. A submission to TEDs as described in the TRICARE Operations Manual is
considered an acceptable invoice or voucher required in accordance with FAR
52.216-7(a)(1).

c. Due to the nature of health care costs, the portions of FAR 52.216-7 that
relate to materials, direct labor, direct travel, other direct costs, indirect
costs, incidental expenses, and pension plan contributions are not applicable.
As such, any portions of FAR 52.216-7 that relate to indirect cost rates and
billing rates are not applicable.

d. In reference to FAR 52.216-7 (g), “audits”, as used in this clause includes
audits on statistically valid samples. The audit results will be applied to the
entire universe from which the audit sample was drawn to determine total
unallowable costs. Overpayments made by the contractor, whether found in an
audited sample or audit results applied to the entire universe from which the
sample was drawn, are unallowable costs. The Contracting Officer will notify the
contractor of intent to disallow costs in accordance with FAR 52.242-1, Notice
of Intent to Disallow Costs.

Underpayments made by the contractor that are found in an audit are not used to
offset overpayment adjustments.

e. In reference to FAR 52.216-7 (h)(2), the Contracting Officer will not approve
contractor’s expense to secure refunds, rebates, credits, or other amounts
(including incentives), as allowable costs for reimbursement under the
costreimbursable line items, including health care line items.

H.6. Evolving Practices, Devices, Medicines, Treatments and Procedures

a. Medical practices and procedures are expected to continue developing during
the period of this contract. Some will increase and some will decrease the cost
of medical care. These changes will include practices, devices, medicines,
treatments and procedures that previously were excluded from the benefits as
unproven. There shall be no change in the Target Cost or Target Fee as a result
of changes in the approval status of drugs, devices, medical treatments and
medical procedures. The contractor underwrites all costs of all drugs covered
under this contract, devices, medical treatments or medical procedures that move
from unproven to proven. Changes caused by changes in the statutory definitions
of the benefit or new benefits added by statute will be implemented under the
Changes clause.

b. TRICARE can only cover costs for medically necessary supplies and services.
Regulatory procedures are in place at 32 C.F.R. 199.4(g)(15) that describe the
procedure for evaluating the safety and efficacy of unproven drugs, devices,
medical treatments, or medical procedures. The contractor shall be responsible
for routinely reviewing the hierarchy of reliable evidence, as defined in 32
C.F.R. 199.2, and shall bring to the Government’s attention drugs, devices,
medical treatments, or medical procedures that they believe have moved from
unproven to proven in a written report to the Government in accordance with F-5.

H.7. Integrated Process Teams

 

 

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The Government may develop major contract and program changes through Integrated
Process Teams (IPTs). This provision describes the contractor’s participation in
this process. The contractor will provide the appropriate personnel (as agreed
to by the Contracting Officer and the contractor) to serve on IPTs to develop
and/or improve the technical, business, and implementation approach to any and
all proposed TRICARE program contract changes within 14 calendar days after
notification by the Contracting Officer. The contractor will participate in the
entire process with the Government team from concept development through
incorporating the change into the contract. This process includes developing
budgetary cost estimates, requirement determination, developing rough order of
magnitude cost estimates, preparing specifications/statements of work, and
establishing a mutually agreeable equitable adjustment to the contract price as
a result of incorporating the change (including pricing, negotiations, etc).
IPTs will not be formed for all contract changes, but generally will be formed
for complex, system-wide issues. The contractor shall participate in all
required meetings as determined by the Government team leader, regardless of how
they are held (in person, via teleconference, by video-teleconference, or
through electronic conferences within the TMA web site). The frequency and
scheduling will vary depending on the topic.

H.8. Performance Guarantee

a. The performance guarantee described in this provision is the contractor’s
guarantee that the contractor’s performance will not be less than the
performance standards described below. The rights of the Government and remedies
described in the Performance Guarantee provision are in accordance with, and in
addition to all other rights and remedies of the Government. Specifically, the
Government reserves its rights and remedies set forth in the Inspection of
Services clause (FAR 52.246-4, 52.246-5) and the Default clause (FAR 52.249-8,
52.249-6).

b. The contractor guarantees that performance will meet or exceed the standards
in this provision. For each occurrence the contractor fails to meet each
guaranteed standard, the Government will withhold from the contractor the amount
listed in the schedule below. Performance guarantee withholds will continue
until the guarantee amount for the respective option period is depleted or the
contractor’s performance improves to meet or exceed the standard. Performance
will be measured as specified below. The contractor will be notified and
withholds made on a quarterly basis. For the purposes of this provision, the
term “performance standard” is defined as the contract standards that are
restated in this provision.

c. Performance Guarantee Amounts:

Option Period I $ ****

Option Period II $ ****

Option Period III $ ****

Option Period IV $ ****

Option Period V $ ****

Option Period VI $****

Option Period VII $****

Option Period VIII $****

Option Period IX $****

d. Telephone Service (Busy Signals)

 

 

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Standard: Not less than 95% of all calls shall be received without the caller
encountering a busy signal

A performance guarantee shall be applied as follows:

Based on the contractor’s monthly report, the Government will withhold a
performance guarantee amount of $0.50 per blocked call in excess of the standard
(not less than 95% of all calls shall be received without the caller
encountering a busy signal). For example, if 92% of calls are received but 8%
are blocked by a busy signal, then a performance guarantee equal to 3% of the
calls [3% represents the difference between the actual number of blocked calls
and the standard] will be assessed. If 3% equates to 100 calls, the performance
guarantee withhold will be $50.00 or 100 times $0.50. The blockage rate shall be
determined no less frequently than once per hour.

“All calls” is defined as any call to any contractor operated TRICARE customer
service telephone number. Customer service shall be interpreted in the broadest
terms including, but not limited to, telephone calls from beneficiaries,
providers, Government representatives, and interested parties about general
program information, network providers, enrollment, eligibility, benefits,
referrals, preauthorization’s/authorizations, claims, complaints, processes and
procedures.

e. Telephone Service (Total Hold Time)

Standard: 95% of all calls shall not be on hold for a period of more than 30
seconds during the entire telephone call A performance guarantee shall be
applied as follows:

If performance falls below the standard for each individual call that has a
total hold time of more than 30 seconds based on the contractor’s monthly report
(calls exceeding the 30 second total hold time divided by total calls received
during the month), the Government will withhold a performance guarantee amount
of $0.50. For example, if only 92% of calls that have a total hold time of 30
seconds are less, the actual number of calls failing the 95% standard will be
assessed a performance guarantee. In this example, the difference equals 3%. If
3% of calls equates to 100 calls not meeting the 30 second total hold time
standard, the performance guarantee withhold will be $50.00 or, 100 times $0.50.

f. Claims Processing Timeliness (Retained Claims and Adjustment Claims)

Standard: Not less than 95% of retained claims and adjustment claims processed
shall be completed within 30 calendar days from the date of receipt

A performance guarantee shall be applied as follows:

If the contractor fails to meet the standard, the Government will withhold a
performance guarantee amount of $1.00 per retained claim in excess of the 95%
standard. For example, if only 91% of retained claims are processed within 30
calendar days, a performance guarantee will be assessed equal to 4% of the
claims processed that month. The 4% represents the difference between the actual
performance of 91% and the standard of 95%. If 4% equates to 600 claims, the
performance guarantee withhold will be $600.00 or 600 times $1.00. The number of
claims failing to meet the standard will be determined monthly based on the TMA
TED database.

 

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g. Claims Processing Timeliness (Retained Claims)

Standard: 100% of retained claims shall be processed to completion within 60
calendar days

A performance guarantee shall be applied as follows:

If the contractor fails to meet the standard of 100% of retained claims
processed to completion within 60 days, the Government will withhold a
performance guarantee amount of $1.00 per retained claim not meeting the
standard. For example, if actual performance is 99% of retained claims processed
to completion within 60 days, the contractor will be assessed a performance
guarantee equal to 1% (the difference between the contractor’s actual
performance and the standard. If 1% equates to 100 claims, the withhold will be
$100.00, or 100 times $1.00. The number of claims failing to meet the standard
will be determined monthly based on the TMA TED database.

h. Claims Processing Timeliness (Excluded Claims)

Standard: 100% of all claims shall be processed to completion within 120
calendar days.

A performance guarantee shall be applied as follows:

If the contractor fails to meet the standard and falls below the standard of all
claims processed to completion within 120 calendar days, the Government will
withhold a performance guarantee amount of $1.00 per claim not meeting the
standard. For example, if 1% (the difference between the contractor’s actual
performance and the standard) of all claims are not processed to completion
within 120 calendar days from the date of receipt, and that equates to 1,000
claims, the performance guarantee amount will be $1,000.00 or, 1,000 times
$1.00. The number of claims failing to meet the standard will be determined
monthly based on the TMA TED database. The Government will assess a performance
guarantee amount monthly until the claim is processed to completion.

i. Payment Errors

Standard: The absolute value of the payment errors for sampled TEDs (initial
submissions, re-submissions, and adjustments/cancellation submissions) shall not
exceed 2%.

A performance guarantee shall be applied as follows:

If payment errors exceed the standard, the Government will withhold 10% of the
value of payment errors exceeding the 2% standard. The Government will not net
errors as a result of overpayments and underpayments. Rather, the Government
will withhold a performance guarantee amount equal to 10% of the sum of all
payment errors in excess of the standard. This amount will be based on the
actual claims audited in the quarterly TMA audits as specified in Section H.

j. TED Edit Accuracy – Validity Edits

Standard: The accuracy rate for TED validity edits shall be not less than: 95 %
after six months of performance during the first option period and 99% after
nine months and thereafter during the entire term of the contract

 

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A performance guarantee shall be applied as follows: If the contractor fails to
meet the standard and falls below either of the two standards of 95 % after six
months or 99 % after nine months, a performance guarantee amount of $1.00 for
each TED record not meeting the standard will be withheld.

For example, if only 90% of all TEDs pass validity edits after six months, then
a performance guarantee amount equal to 5% of all TEDs failing the edits during
the quarter will be withheld (5% equals the difference between the contractor’s
actual performance and the standard in this example). If 5% equates to 1,000
TEDs, the performance guarantee amount will be $1,000.00 or 1,000 times $1.00.
The number of TEDs failing to meet the standard will be determined monthly based
on the TMA TED database.

k. TED Edit Accuracy – Provisional Edits

Standard: The accuracy rate for provisional edits shall not be less than: 90 %
after six months of performance during the first option period and 95 % after
nine months and thereafter during the entire term of the contract

A performance guarantee shall be applied as follows: If the contractor fails to
meet the standard and falls below either of the two standards of 90 % after six
months or 95 % after nine months, a performance guarantee amount of $1.00 for
each TED not meeting the provisional edit standard will be withheld. For
example, if only 85% of all TEDs pass provisional edits after six months, a
performance guarantee equal to 5%, or the difference between the contractor’s
actual performance and the standard, will be assessed.

If, as in this example, 5% equates to 1,000 TEDs, the performance guarantee will
be $1,000.00 or 1,000 times $1.00. The number of TEDs failing to meet the
standard will be determined monthly based on the TMA TED database.

l. Contractor Network Adequacy

Standard: Not less than 96% of contractor referrals of beneficiaries residing
within a Prime service area shall be to a MTF or network provider with an
appointment available within the access standards. Based on the contractor’s
monthly report, a performance guarantee shall be applied as follows for
referrals failing the standard:

if less than 96% and more than or equal to 93% $25.00 per referral*

if less than 93% and more than or equal to 91% $50.00 per referral*

if less than 91% and more than or equal to 90% $75.00 per referral*

if less than 90% $100.00 per referral*

 

* The withhold will be based on the difference between the contractor’s actual
performance and the standard.

For purposes of this provision, a referral is the offer of an appropriate
appointment within the access standards. If the beneficiary elects not to accept
the offered appointment, the contractor has met the standard. In determining the
performance guarantee, the applicable amount will be determined based on the
offeror’s actual performance. For instance, if the contractor’s actual
performance is 90%, the performance guarantee will equal $75 per referral in
excess of 96%. In

 

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this example if 5% equals 1,000 referrals failing the standard, the performance
guarantee will equal $75,000. It is critical that the contractor recognize that
the highest per referral withhold will be applied to all referrals failing the
standard. The Government will not stratify the performance guarantee based on
the above.

m. Specialty Care Referral Consultation Reports

Standard: The contractor shall ensure that network specialty providers submit
clearly legible specialty care referral consultation reports, for all contractor
approved “eval only” and “eval and treat” MTF referrals which require a consult
report.

When the contractor receives a referral request from the MTF, the request will
be processed one of the following ways:

 

  •  

Approved

 

  •  

Denied (denied due to non-covered benefit or lack of documented medical
necessity)

 

  •  

Pended (referral approval/denial determination is in progress)

 

  •  

Returned to the MTF for more information (future approval or denial)

 

  •  

Cancelled, returned to the MTF as “no referral needed for type of care”

All approved referral requests are entered into Medical Services Review (MSR)
and await the receipt of a claim and consult report. The referrals will be
designated “eval only” or “eval and treat”. “Eval and treat” is the default, if
not specified based upon the request from the MTF provider, as outlined in the
CORE MOU. The contractor will record the type of referral upon receipt of the
orders from the MTF provider. This designation will remain for the life of the
referral. The contractor will designate in MSR which referral requires a consult
report in accordance with Section C- 7.2.2, as further detailed by the rule set
agreed to by the contractor and TRO-S. The contractor will display on the Web
the status of each request sent to the contractor by the MTF provider. This
includes all MTF referrals, whether the referral was approved, denied or
cancelled. Approved MTF referrals which require a consult report will be tracked
and the contractor will provide the MTF the ability to request an “expedited
chase” for clinically significant consult reports not delivered within
timeliness standards (see Section C-7.2.c.). The display will be arranged by the
month the referral was processed and identify the following:

 

  •  

Service NOT rendered (no evidence of kept appointment, claim, or a return
consult)

 

  •  

Service rendered-closed (kept appointment confirmed and/or claim verified;
consult received)

 

  •  

Service rendered-open (kept appointment confirmed and/or claim verified; consult
not received).

Performance Guarantee (PG) Calculation/Measurement

Performance Guarantee calculation of specialty care referral consultation
reports performance will be done quarterly based on the contractor’s sum of
three month’s worth of monthly calculations. On the 15th of each month the
monthly reporting will be delivered. For Option Period III the first monthly
performance guarantee report will be delivered on October 15, 2006, covering
April 2006 referrals. In December 2006 the first quarterly guarantee report for
Option Period III will be delivered covering April, May and June of 2006. For
subsequent Option Periods, the monthly performance guarantee report will be
delivered on the 15th of the month

 

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and the quarterly assessment on the contractor’s sum of three month’s worth of
monthly calculations.

10 working day standard:

“Eval only”: Consult returns shall be provided to the MTF within 10 working days
of the specialty encounter 98% of the time. Computation of this performance
guarantee will be accomplished by using the last date of service of the referred
care as the trigger date. A performance guarantee will be withheld for each
report not provided within the standard in the amount of:

$25.00 per missing report in Option Period III

$50.00 per missing report in Option Period IV

$75.00 per missing report in Option Period V, and any exercised extension after
Option Period V

For example, if 96% of reports are provided to the initiating MTF within 10
working days of last date of service for the rendered care by network specialty
physician providers during Option Period III, and 100 reports are required, the
Government will withhold $50 ($25 x 2 missing/late reports not meeting the 98%
standard). If neither evidence of an appointment kept nor a claim has been
submitted nor a consult report has been received within the 5 month period, no
performance guarantee is assessed, and the referral is presumed to represent a
beneficiary who did not fulfill an appointment as a result of the referral.

30 calendar day standard:

(a). “Eval only”: Consult returns shall be provided to the MTF within 30
calendar days of the specialty encounter 100% of the time. Computation of this
performance guarantee will be accomplished by using the last date of service of
the referred care as the trigger date, and applying one of the following
assessment criteria:

i. When the consult return percentage is less than 98%, the performance
guarantee penalty will be computed by multiplying the total expected by 2% and
then multiplying by the performance guarantee amount.

ii. When the consult return percentage is greater than 98%, the performance
guarantee penalty will be computed by subtracting that actual achieved
percentage from the 100% standard, then multiplying the difference by the total
expected consults. The results should then be multiplied by the performance
guarantee amount.

A performance guarantee will be withheld for each report not provided within the
standard in the amount of:

$25.00 per missing report in Option Period III

$50.00 per missing report in Option Period IV

$75.00 per missing report in Option Period V, and any exercised extension after
Option Period V

(b.) “Eval and treat”: Consult returns shall be provided to the MTF within 30
calendar days of the specialty encounter 100% of the time. Computation of this
performance guarantee will be

 

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accomplished by using the initial date of service of the referred care as the
trigger date. A performance guarantee will be withheld for each report not
provided within the standard in the amount of:

$25.00 per missing report in Option Period III

$50.00 per missing report in Option Period IV

$75.00 per missing report in Option Period V, and any exercised extension after
Option Period V

For example, if 95 reports are provided within 30 calendar days of the initial
“eval and treat” visit by network specialty physician providers during Option
Period III, and 100 reports are required, the Government will withhold $125 ($25
x 5 missing/late reports not received within 30 calendar days). If neither
evidence of an appointment kept nor a claim has been submitted nor a consult
report has been received within the 5 month period, no performance guarantee is
assessed, and the referral is presumed to represent a beneficiary who did not
fulfill an appointment as a result of the referral.

H.9. Award Fee

The award fee will be administered quarterly following the completion of each
contract quarter in accordance with the award fee plan. The award fee pool is
prorated into two quarters in option period I, VII and VIII and into four equal
amounts for the remaining option years, as shown in Section B. Awarded portions
are disbursed quarterly in accordance with the award fee plan. Unawarded
portions of the award fee pool are not available for any subsequent period. The
results of the Government administered surveys will be considered in determining
the award fee and that any contractor administered survey results are
specifically excluded from consideration.

H.10. Processing of Newborn Claims

For those newborns who are covered under the 60 day “deemed enrollment” benefit,
the contractor shall code these claims as civilian PCM Prime until a formal
enrollment action or the end of the 60 day period, whichever is earlier. If the
newborn is formally enrolled during this 60 day period, for claims incurred
after the formal enrollment the contractor shall code the claims according to
the formal PCM assignment. If the newborn is not formally enrolled after the 60
calendar day period, for claims subsequently incurred after the 60 days the
contractor shall process these claims as a non-enrolled beneficiary, applying
the appropriate TRICARE cost shares and deductibles. Note that this PCM coding
approach during the “deemed enrollment” period does not affect the status of
these newborns for purposes of the contract’s underwriting provisions, as
underwriting applies to eligible newborns regardless of their enrollment or CM
status. Similarly, this PCM coding approach during the “deemed enrollment”
period does not change TRICARE policy regarding the actual payment of the claim
from a beneficiary or provider perspective.

H.11. Claim Cycle time and Audit Methodology

a. Claim Cycle Time Measurement.

 

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The Government will calculate the claim cycle time based on data submitted on
TRICARE Encounter Data (TEDs). The cycle time is calculated as one plus the
difference between the Julian date that the claim or adjustment claim was
processed to completion and the Julian date of receipt or the Julian date the
claim was identified as an adjustment. Only a single cycle time will be
calculated per claim. This cycle time will be calculated using all unedited TEDs
initial submission vouchers (Voucher Resubmission Number equals zero) which are
received by TMA during each quarter and which pass the voucher header edits.
TEDs in vouchers which fail the voucher header edits or which are otherwise
unprocessable as submitted by the Contractor and TEDs in resubmission vouchers
(Voucher Resubmission Number is greater than zero) will be excluded from the
claim cycle time calculation.

(1) Quarterly Healthcare Audit - Claim Audit Sampling and Error Determinations

(a) Sampling Methodology

Sample means will be used as point estimates of payment and occurrence errors.
There will be two kinds of payment samples, one for non-denied claims and one
for denied claims. The design of non-denied payment and the occurrence samples
utilizes a ninety percent (90%) confidence level, while the denied payment
sample design uses an eighty percent (80%) confidence level. Precision estimates
are 1.0 percent (1%) for the non-denied payment sample, 2.0 percent (2%) for the
denied payment sample, and 1.5 percent (1.5%) for the occurrence sample. The
non-denied payment sample will be drawn from all records with government
payments of $100 to $100,000. In addition, all records with a government payment
of $100,000 and over will be audited. The denied payment sample will be drawn
from all records with billed amounts of $100 to $100,000. In addition, all
records with billed amounts of $100,000 and over will be audited. The non-denied
and denied payment samples will be stratified at multiple levels within the $100
to $100,000 range. Samples will be drawn on a quarterly basis from TED records
which are fully or provisionally accepted. Records to be sampled will be “net”
records (i.e. the sum of transaction records available at the time the sample
was drawn related to the initial transaction record). TED records in voucher
batches which fail any validity edits or which are otherwise unprocessable as
submitted by the contractor will be excluded from the sampling frame.

(b) Required Contractor Documentation.

[1] Upon receipt of the TEDs Internal Control Number (ICN) listing from TMA or
designated audit contractor, the Contractor shall retrieve and compile
processing documentation for each selected claim. The Contractor shall submit
one legible copy of each claim and the following required documents via
registered mail, certified mail or similarly guaranteed delivery service. All
documentation must be received at TMA or designated audit contractors within 30
calendar days from the date of the TMA or designated audit contractors letter
transmitting the ICN listing:

(i) Claim-related correspondence when attached to claim or related to the
adjudication action, such as status inquiries, written and/or telephone,
development records, other telephone conversation records.

(ii) Other claim-related documentation, such as medical reports and medical
review records, coding sheets, all authorization and referral forms and their
supporting documentation, referrals for civilian medical care (SF Forms 513 or
2161), other health insurance and third party liability documents, discounted
rate agreements to include the following information: 1) provider name, 2)
provider identification number, 3) effective and termination dates of
agreements; and 4)

 

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negotiated rate or fee schedule and such other documents as are required to
support the action taken on the claim.

(iii) A copy of the EOB (or EOB facsimile) for each claim selected.

(iv) The contractor shall send via electronic data input on a 3480 cartridge the
current family history (15 to 27 months) for each selected claim. This
electronic data containing all required data fields must be received by TMA or
designated audit contractor within 30 calendar days from the date of the TMA or
designated audit contractor letter transmitting the ICN listing.

[2] Payment errors or occurrence errors will be assessed if the Contractor does
not provide the above claim-related documents or if the documents provided are
not legible. The Contractor has the option of submitting the original document
in those cases where the copy is not legible. TMA or designated audit
contractors will return original documents upon completion of the audit process.

(c) Additional Data to be Furnished by the Contractor.

[1] Description of data elements by field position in family history file
printout. Initial submission to TMA is due by the commencement of claims
processing and revisions as they occur.

[2] Claim adjudication guidelines used by processors; automated prepayment
utilization review screens; automated duplicate screening criteria and manual
resolution instructions shall be submitted to TMA by the commencement of claims
processing.

[3] Unique internal procedure codes with narrative and cross-reference to
approved TRICARE codes and pricing manuals used in claims processing. Initial
submission to TRICARE is due by the commencement of claims processing and
revisions as they occur, but not later than the 5th work day of the month
following the change.

[4] Specifications for submission of the provider and pricing files are
described in the TEDs System Manual. Initial submission to TMA is due by the
commencement of claims processing and updates to the files are to be submitted
as specified in the TEDs System Manual.

(d) Payment Error and Process Error Determinations.

[1] There are two categories of payment errors: (1) a payment error which cannot
be removed by contractor post payment processing actions and (2) a payment error
which can removed by contractor post payment processing actions (see list of
audit error codes defining payment error categories). Payment errors which can
be removed by contractor post payment actions will also be assessed a process
error at audit. If contractor post payment actions substantiate the initial
processing decision, the payment error will be removed but the process error
will remain. If the initial processing action is not substantiated, both the
payment and the process error will remain. Claims containing process errors will
not affect payment or occurrence error rates, but will be used as a performance
indicator.

[2] Payment errors are the amount of over/under payments on a claim, including
but not limited to a payment in the correct amount but sent to the wrong payee,
denial of a payable claim, misapplication of the deductible, payment of a
noncovered service/supplies, or services/supplies

 

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for which a benefit determination cannot be based on the information available
at the time of processing. Process errors result from: noncompliance with a
required procedure or process, such as development required but not performed,
medical emergency not substantiated, medical necessity review not evident and
are cited in conjunction with a payment error. Process error determinations are
based on the claim information available and those processing actions which have
passed the TMA TED Validity edits up to the time the audit sample is pulled.

[3] Payment errors which may not be removed by Contractor post payment actions
(see audit error categories) are based only on the claim information available
and those processing actions which have passed the TMA TED Validity edits up to
the time the audit sample is pulled. Actions and determinations occurring
subsequent to the date the audit sample is pulled or actions and determinations
which have not passed the TMA TED Validity edits are not a consideration of the
audit regardless of whether resolution of a payment error results. Because
adjustment transactions are not allowed on total claim denials, subsequent
reprocessing actions to the denied claim which occur prior to the date the audit
sample is pulled will be considered during the audit.

[4] The measure of the payment error is the TED record. The audit process (for
the payment samples) projects universe value based on the audit results. The
samples (non-denied and denied) are separately projected to the universe of
claims for each quarter. The results of these projections are then combined into
the following categories: total number of claims in the universe, government
payment estimation, correct government payment, error amount and the estimated
error percent in the universe of claims.

[5] All incorrectly coded financial fields on a TED are considered to be
occurrence errors regardless of whether associated errors exist.

(e) Computation of the “Total Amount Billed” for Denied Claims.

[1] For treatment encounters for which no per diem, negotiated rate or DRG-based
amount applies for consideration of payment, the “total amount billed” is the
actual amount billed on the claims. This applies to treatment encounters
involving services from DRG-exempt hospitals and hospital units, those involving
DRG-exempt services and those which would otherwise be subject to the DRG-based
payment methodology but for which a DRG allowed amount cannot be computed,
regardless of whether or not these claim are paid;

[2] For treatment encounters subject to the TRICARE per diem payments,
negotiated rate, or the DRG-reimbursement methodology, the “total amount billed”
is the correct per diem, negotiated rate, or DRG-based allowable amount
including any applicable outlier amounts.

[3] If a claim is selected for audit and the Contractor cannot produce the claim
or the claim provided is not auditable, a 100 percent payment error based upon
the total amount billed will be assessed. For health care services records which
do not represent a legitimate condition requiring submission of a record as
defined in the TRICARE Systems Manual, a 100 percent error will be assessed. The
payment error amount will be based upon the total amount billed. This condition
is considered to be an unsupported TED.

(f) TED Occurrence Error Determination

 

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[1] The TED occurrence error rate is defined as the total number of errors
divided by the total number of data fields in the sample times 100.

[2] Occurrence errors determinations are based on only the claim information
available and those processing actions taken at the time of adjudication.
Actions and determinations occurring subsequent to the processed date of an
audited claim, such as obtaining other health insurance documentation, adjusting
a claim to correct financial or other data fields, or developing for required
information not obtained prior to processing, are not a consideration of the
audit regardless of whether a resolution of the incorrectly coded TED results.

[3] Occurrence errors result from an incorrect entry in any data field of the
TED. There are no exceptions. Any error, including errors in financial fields,
shall be counted as occurrence errors.

[4] Some TED error conditions are not attributable to any one specific data
field but apply to the record as a whole or to certain parts of the record. In
addition to erroneous data field coding, the following error conditions
involving incorrect or unsupported records will result in occurrence errors
being assessed as indicated. Following are error conditions and the associated
number of occurrence errors assessed with each condition; payment error codes
that post payment actions do not apply; payment error codes that post-payment
actions do apply, and process error codes.

 

ERROR CONDITION

 

NUMBER OF ERRORS

Unlike Procedures/Providers Combined (Noninstitutional Record)   7 errors for
each additional utilization data set* Unlike Revenue Codes Combined
(Institutional Record)   5 errors for each erroneous revenue code set** Services
Should Be Combined   1 error for each additional revenue code/utilization data
set Missing Noninstitutional Utilization Data Set   7 errors for each missing
data set* Extra Noninstitutional Utilization Data Set   7 errors for each extra
data set* Missing Institutional Revenue Code Set   5 error for each missing
revenue code set** Extra Institutional Revenue Code Set   5 errors for each
extra revenue code set** Incorrect Record Type   5 errors Claim Not Provided for
Audit   1 error plus 1 error for each revenue code utilization data set in the
TED   Claim Not Auditable 1 error plus 1 error for each revenue code utilization
data   set in the TED Unsupported TED Transaction   1 error plus 1 error for
each revenue code utilization data set in the TED

 

* Not to exceed 21 errors for combination of these error conditions

** Not to exceed 15 errors for combination of these error conditions

The following are payment errors on which post payment actions are either not
applicable or would not remove the payment errors assessed.

01K-Authorization I PreAuthorization Needed (all — except PPWD* and Adjunctive
Dental Authorizations)

 

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03K-Billed Amount Incorrect

04K-Cost-share / Deductible Error

07K- Duplicate Services Paid

08K- Eligibility Determination – Patient

09K- Eligibility Determination – Provider

12K- Non-Availability Statement Error

13K-OHI/TPL – Govt. Pay Miscalculated

16K- Payee Wrong- Provider

17K- Participating/Non-Participating Error

18K- Pricing Incorrect

19K-Procedure Code Incorrect

20K-Signature Error

22K- DRG Reimbursement Error

24K-Incorrect Benefit Determination

25K-Claim Not Provided

26K-Claim Not Auditable

27K-Incorrect MCS System

The following are payment errors on which post-payment actions may support
original processing. On rebuttal, if documentation is provided that supports the
processing actions, the payment errors could be removed but the process errors
would remain.

01K-Authorization/Pre-Authorization Needed (PPWD* and adjunctive dental
authorizations)

02K-Unsupported Benefit Determination

05K-Development Claim Denied Prematurely

06K-Development Required

10K-Medical Emergency Not Substantiated

11K-Medical Necessity/Review Not Evident

21K-Timely – Filing Error

23K-Contract Jurisdiction Error

99K-Other – This payment error is very general and claims would have to be
reviewed on an individual basis with regard to post-payment actions.

 

* PPWD – Program for Persons with Disabilities

The following are process errors which will be assessed for noncompliance of a
required procedure/process. These errors are neither occurrence errors or
payment errors and are not used to calculate the occurrence error or payment
error rate. A payment error will be assessed along with the process error. Upon
rebuttal if the process is followed to conclusion and the actions support the
original decision, the payment error will be removed but the process error will
remain.

01P - Authorization/Pre-authorization needed (PPWD arid dental authorizations)

02P - Unsupported Benefit Determinations

05P - Development Claim Denied Prematurely

06P - Development Required

10P - Medical Emergency Not Substantiated

11P - Medical Necessity/Review Not Evident

21P - Timely Filing Error

23P - Contract Jurisdiction Error

 

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99P - Other

(2) Error Determination Rebuttals

(a) Contractor rebuttals of audit error findings must be submitted to TMA or the
designated quality audit within 45 calendar days of the date of the audit
transmittal letters. Rebuttals not postmarked within 45 calendar days of the
audit letter will be excluded from further consideration. Rebuttal responses are
final and will not receive further consideration except when during the audit
rebuttal process the contractor submits a claim not previously submitted with
the audit and an error is assessed, or when the contractor’s explanation of the
basis on which a claim was processed results in the assessment of a new error
not previously reviewed by the contractor. Contractor rebuttals to new errors
assessed by TMA or the designated audit contractor during the initial rebuttal
process must be postmarked within 30 calendar days of the TRICARE or designated
quality review contractor rebuttal response letter. Rebuttals to new errors not
postmarked within 30 calendar days from the date of the rebuttal letter will be
excluded from further consideration. The due dates of rebuttals will be
calculated by adding 45 to the Julian calendar date of the TMA or designated
audit contractor audit letter or by adding 30 to the Julian calendar date of the
TMA or designated audit contractor rebuttal response letter.

b. Annual Healthcare Cost Audit

TRICARE Encounter Data (TED) batch/voucher payment records are utilized to
determine allowable cost. The total allowable amount is calculated on a per
record basis, using all fields used to calculate a batch/voucher header total,
and for dates of service falling within a specified option period. The total
government paid amount will be calculated using all edited TEDs batch/vouchers
with resubmission number equal to zero and which are received by TMA. Batch/
voucher records that have not passed validity edits on the TED record or which
are otherwise unprocessable as submitted by the contractor will be excluded from
the sample.

(1) Claim Audit Sampling and Error Determinations.

(a) Sampling Methodology and Application of Results for Option Period I

A stratified random sample of claims from the universe of non-denied
underwritten claims will be used to estimate the mean overpayment amount per
claim in the claims universe and the lower limit of a one-sided ninety-percent
(90%) confidence interval (estimated mean – 1.2815 x standard error). All claims
in the sample determined to have been underpaid will be deemed to have an
overpayment amount of zero. The lower limit of the confidence interval will be
used as the recovery amount per claim in the universe of claims from which the
sample is drawn. The total recovery amount will be calculated as the recovery
amount per claim multiplied by the number of claims in the universe from which
the sample is drawn. The payment samples will be drawn from all records with
Government payments of $100 to $100,000. The payment samples will be stratified
at multiple levels within the $100 to $100,000 range. In addition, all records
with a government payment of $100,000 and over will be audited. Samples will be
drawn from those underwritten TED records which are fully or provisionally
accepted, with end dates of service in the option period, through the ninth
month after the end of option period I. Claims identified as non-underwritten
will be removed by the Government from the sample and the universe, and will not
be replaced. The Government reserves its rights to perform specific and/or more
frequent audits than annual. Records to be sampled will be “net” records (i.e.
the sum transaction records available through the ninth month after the end of
the option period). TEDs in

 

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batch/vouchers, that fail TRICARE validity edits or which are otherwise
unprocessable as submitted by the contractor will be excluded from the sampling
frame.

(b) Sampling Methodology and Application of Results for Option Periods II
through the end of the contract For Option Periods II through the end of the
contract, the same sampling methodology used will be as described in Section
H.11.b.(1) (a) above for Option Period I. For Option Period II, samples will be
drawn from underwritten TED records which are fully or provisionally accepted,
with end dates of service in the option period through the ninth month. For
Option Periods III through VI, samples will be drawn from underwritten TED
records which are fully or provisionally accepted, with end dates of service in
the respective option period, through the sixth month after the end of the
option period. For Option Periods VII and VIII, a single audit will be
performed. If only Option Period VII is exercised, an audit sample will be drawn
from underwritten TED records with end dates of service in Option Period VII.
Should the Government exercise Option period VIII, an audit sample will be drawn
from underwritten TED records with end dates of service in both Option Periods
VII and VIII. Sample for Option Periods VII and VIII will be drawn from
underwritten TED records which are fully or provisionally accepted into the TMA
database through the sixth month after the end of the last exercised Option
Period. For Option Periods III through the end of the contract, the Government
will draw the sample no later than seven (7) months after the end of the
respective option period. The Government reserves its rights to perform specific
and/or more frequent audits than annual. Records to be sampled will be “net”
records (i.e. the sum of the option period transaction records available through
the sixth month after the end of the option period). The total overpayment
recovery amount for each option period will be determined based on the lower
bound of a one-sided ninety-percent (90%) confidence interval. The Government
shall provide, at the same time the sample is requested, a complete listing of
all TED records that encompass the audit universe for each respective Option
Period. The contractor must identify all TED records that it believes should be
excluded from the audit universe which includes non-underwritten claims and
claims that were not within the dates of service range for the respective Option
Period and provide documentation justifying their exclusion not later than
thirty (30) days after receipt of the listing. Claims identified as
nonunderwritten will be removed by the Government from the sample and the
universe, and will not be replaced.

(c) Required Contractor Documentation

[1] Upon receipt of the TEDs Internal Control Number (ICN) listing from TMA or
designated audit contractor, the Contractor shall retrieve and compile
processing documentation for each selected claim. All documentation must be
Received at TMA or designated audit contractors within thirty (30) calendar days
from the date of the TMA or designated audit contractors letter transmitting the
ICN listing. The Contractor shall submit one legible copy of each claim and the
following required documents via registered mail, certified mail or similarly
guaranteed delivery service:

(i) Claim-related correspondence when attached to claim or related to the
adjudication action, such as status inquiries, written and/or telephone,
development records, other telephone conversation records.

(ii) Other claim-related documentation, such as medical reports and medical
review records, coding sheets, all authorization and referral forms and their
supporting documentation, referrals for civilian medical care (SF Forms 513 or
2161), other health insurance and third party liability

 

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documents, discounted rate agreements to include the following information: 1)
provider name, 2) provider identification number, 3) effective and termination
dates of agreements; and 4) negotiated rate or fee schedule and such other
documents as are required to support the action taken on the claim

(iii) A copy of the EOB (or EOB facsimile) for each claim selected.

(iv) The current family history (15 to 27 months) for each selected claim. The
Contractor shall send this via electronic data input on a 3480 cartridge.

[2] If a claim is selected for audit and the Contractor cannot produce the claim
or the claim provided is not auditable, a 100 percent payment error based upon
the total Government Pay Amount will be assessed. For TEDs which do not
represent a legitimate condition requiring submission of a record as defined in
the TRICARE Systems Manual, a 100 percent error will be assessed. The payment
error amount will be based upon the total Government Pay Amount. This condition
is considered to be an unsupported TED. The contractor has the option of
submitting the original document in those cases where the copy is not legible.
TMA or designated audit contractors will return original documents upon
completion of the audit process.

(d) Additional Data to be furnished by the Contractor

[1] Description of data elements by field position in family history file
printout. Initial submission to TMA is due by the commencement of claims
processing and revisions as they occur.

[2] Claim adjudication guidelines used by processors; automated prepayment
utilization review screens; automated duplicate screening criteria and manual
resolution instructions shall be submitted to TMA by the commencement of claims
processing.

[3] Unique internal procedure codes with narrative and cross-reference to
approved TRICARE codes and pricing manuals used in claims processing. Initial
submission to TRICARE is due by the commencement of claims processing and
revisions as they occur, but not later than the fifth (5th) work day of the
month following the change.

[4] Specifications for submission of the provider and pricing files are
described in the TEDs System Manual. Initial submission to TMA is due by the
commencement of claims processing and updates to the files are to be submitted
as specified in the TEDs System Manual.

(e) Payment Error Determination for Allowable Cost Audit

[1] The audit error codes (K codes) indicated in above will apply to the cost
audit. Payment errors are based on the claim information available and those
processing actions which occur prior to the date the audit sample is pulled.
Consideration will be given to subsequent processing actions that occur prior to
the date the audit sample is pulled, including actions that have not passed the
TMA TED edits, only if supporting documentation to indicate the action taken and
the date the action was completed is submitted. Actions and determinations
occurring after the date the audit sample is pulled will not be considered in
the audit regardless of whether resolution of payment error exists.

 

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[2] Payment errors are the amount of over payments on a claim, including but not
limited to misapplication of the deductible, payment of non-covered
service/supplies, or payment of services/supplies for which a benefit cannot be
determined based on the information available at the time of processing or a
payment in the correct amount but sent to the wrong payee.

[3] The measure of the payment error is the TRICARE Encounter Data record. The
audit process (for the payment samples) projects universe value based on the
audit results.

(2) Cost Audit Rebuttals

(a) Contractor rebuttals of audit error findings must be submitted to TMA or the
designated quality auditor within forty five (45) calendar days of the date of
the audit transmittal letters. Rebuttals not postmarked within forty five
(45) calendar days of the audit letter will be excluded from further
consideration. Rebuttal responses are final and will not receive further
consideration except when, during the audit rebuttal process, the contractor
submits a claim not previously submitted with the audit and an error is
assessed, or when the contractor’s explanation of the basis on which a claim was
processed results in the assessment of a new error not previously reviewed by
the contractor. Contractor rebuttals to new errors assessed by TMA or the
designated audit contractor during the initial rebuttal process must be
postmarked within 30 calendar days of the TRICARE or designated quality review
contractor rebuttal response letter. Rebuttals to new errors not postmarked
within 30 calendar days from the date of the rebuttal letter will be excluded
from further consideration. The due dates of rebuttals will be calculated by
adding 45 to the Julian calendar date of the TMA or designated audit contractor
audit letter or by adding 30 to the Julian calendar date of the TMA or
designated audit contractor rebuttal response letter.

(b) The rebuttal for the healthcare cost audit shall be certified by a
responsible official of the contractor as to accuracy and completeness. The
rebuttal submission and the rebuttal process used by the contractor shall be
subject to review by the Government. The corporation and/or certifying
individual may be subject to criminal prosecution for any false certifications
made.

(3) Unallowable Costs Recoupment Process

(a) Upon completion of the Annual Healthcare process described above, the
Contracting Officer will determine the amount, if any, of unallowable costs /
overpayments made by the Contractor; and issue to the Contractor a notice of
intent to disallow unallowable costs. The Contractor Officer in said notice will
define the method that the Contractor’s liability shall be satisfied, i.e.
offset; direct reimbursement to the Government, etc.

(b) The Contractor may choose to seek recoupments from its providers for
overpayments identified in the AHCC. Such adjustments shall be processed through
TEDS. When the MCS contractor submits a TED record cancellation or adjustment
due to a recoupment action, the TED system automatically withholds the
identified overpayment. For claims that were included in the AHCC universe, this
results in the contractor reimbursing the government twice for the same action.
The Government recognizes this constitutes a double recoupment action. The
following manual process will be utilized to provide reimbursement to the
contractor for these double recoupments.

(c) Manual Process For Double Recoupments Arising From AHCC Audits

 

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[1] The Contractor shall submit quarterly reports for all overpayments recouped
from records that were included in the audit universe. This report will be due
to the Contracting Officer no later than the end of the month following the end
of each contract calendar quarter (June 30, September 30, Dec 31, and Mar 31).
The report shall identify:

 

  •  

Records included in the audit universe by TED Record Indicator (TRI),

 

  •  

The date of recoupment/adjusted action,

 

  •  

The cycle in which the recoupment/adjusted TED record was accepted into the TEDs
database, and

 

  •  

The amount of the recoupment/adjusted.

[2] Within 60-days of receipt of the report, the Government will validate that
the identified records were included in the audit universe, the
recoupment/adjusted amount, and the acceptance of the TED record (passes all
validity edits) against the TRICARE transactions file. Any TED record that does
not meet the reporting criteria and is unable to be validated will be reported
back to the contractor with a request for additional information to justify
reimbursement.

[3] The contractor will be able to use this process for four full calendar
quarters following the sample claim pull for Option Periods II through end of
the the contract. For Option Period I, the contractor will be able to use this
process for six full calendar quarters following the sample pull. After that
date, recoupments that may be eligible for reimbursement to the contractor will
be addressed through a formal Request for Equitable Adjustment. For example: If
the audit sample is drawn on October 3lst, then the procedure outlined above can
be used by the contractor through the full calendar quarter ending December 31st
of the following year with the final list of recoupments provided to the
Government no later than the last day of the following month when the quarterly
report is due.

[4] The initial quarterly review will be based on transactions that have
processed and passed all validity edits from the month following the audit
extract date up to and through the report receipt date. When TMA has completed
its review of the contractor’s quarterly report; the contractor will be
instructed in writing by the Contracting Officer to invoice the government for
all verified claims amounts.

H12. Assumption of Performance in a Second TRICARE Contract Area

TRICARE is a statutory entitlement program under which there can be no lapse in
program execution or interruption of services. It is the Government’s duty to
take all reasonable steps to ensure the ready availability of alternative
contract sources to facilitate stability in administration of the statutory
entitlement program, help avoid unnecessary disruption in healthcare provider
and patient relationships, and insure continuation of critical health services.
Recognizing the potential that circumstances may arise under which the
Government may require an alternative contractor to assume, on an interim basis,
contract performance in one of the three TRICARE contract areas, the Government
will consider other options, including substituting contract performance by one
or both of the other contractors pending competitive acquisition of a successor.
The Government agrees to negotiate in good faith fair and reasonable
compensation for the additional work to be performed. The contractor retains all
rights to equitable adjustments under the Changes clause in this matter.

 

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H.13. Additional Performance Standards

The following standards will apply if they are more stringent than the standards
stated elsewhere in the contract or referenced manuals.

a. The contractor will process ****of requests for no expedited factual
reconsiderations to completion within **** calendar days of receipt of the
reconsideration request and **** within **** calendar days.

b. The contractor will process **** of all networks and non-network retained
claims and adjustment claims to completion within **** calendar days from the
date of receipt.

c. The contractor will process **** of all network and non-network claims to
completion within **** calendar days unless the Government specifically directs
the contractor to continue pending a claim or group of claims.

d. On a prepayment basis, the contractor will review all claims (regardless of
risk) for non-network services with billed charges that exceed $**** on which
the TRICARE Reimbursement Method is either billed charges or a DRG allowable
that exceeds billed charges in a final attempt to obtain a single case discount.

e. The contractor will ensure compliance of XPressClaims with Department of
Defense accrediation and encryption requirements as outlined in TSM Chapter 1,
Section 1.1within specified time frames **** of the time.

f. The contractor will update other health insurance information on
beneficiaries daily in the claims processing system

g. The contractor will submit files to the TRICARE Management Activity
centralized TRICARE Encounter Provider Record system within one workday of
certification.

h. TED Processing

The contractor will correct and return **** of all unprocessable vouchers
/batches for receipt at TMA within **** calendar days of the date the invalid
data was transmitted to the contractor by TMA. (Excludes foreign claims)

i. Validity Edits

The contractor will correct (clear all TMA validity edits) and resubmit **** of
all vouchers/batches having TEDs failing validity edits to TMA within ****
calendar days after the errors and rejected TEDs were transmitted to the
contractor by TMA. (Excludes foreign claims) The contractor will correct (clear
all TMA validity edits) and resubmit **** of all remaining unprocessable
vouchers/batches having TEDs failing validity edits to TMA within **** calendar
days after the data was transmitted to the contractor by TMA. The resubmission
data shall contain all TEDs rejected in the voucher/batch. (Excludes foreign
claims)

j. Provisional Edits

 

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The contractor will correct (clear all TMA edits) and resubmit **** of all
vouchers/batches having TEDs failing provisional edits to TMA within ****
calendar days after the errors and rejected TEDs were transmitted to the
contractor by TMA. (Excludes foreign claims) The contractor will correct (clear
all TMA edits) and resubmit **** of all remaining vouchers/batches having TEDs
failing provisional edits to TMA within **** calendar days after the data was
transmitted to the contractor by TMA. (Excludes foreign claims) The contractor
will meet the standard that **** of TEDs (initial submissions, resubmissions,
and adjustment/cancellation submissions) will pass the TMA provisional edits
after **** months following start of health care delivery and will exceed the
standard by achieving a **** pass rate after **** months. (Excludes foreign
claims)

k. Continued Health Care Benefit Program (CHCBP)

The contractor will ensure that all CHCBP claims are identified accurately and
flagged for processing in **** of the cases in accordance with Section C,
C-7.21.15

l. Program for People with Disabilities (PFPWD)

The contractor will ensure that all beneficiaries authorized to receive benefits
under the PFPWD are identified and their claims are accurately flagged for
processing in **** of the cases in accordance with Sec C, C-7.21.12

m. Foreign Claims

Foreign Claims TED submissions (initial submissions, resubmissions, and
adjustment/cancellation submissions) will occur daily, exceeding the once in
seven days standard.

n. The contractor will promote MTF Prime Enrollment by posting notices when MTF
PCM capacity becomes available on the contractor web site and in locations such
as the TSC and MTF.

o. Beneficiary Satisfaction Report Card

The contractor will benchmark each satisfaction “Report Card” metric after the
first six months of health care delivery and will achieve no less than ****
overall improvement each option year.

p. Correspondence

The contractor will provide final responses to **** of routine written inquiries
within **** calendar days of receipt.

q. Priority Correspondence

The contractor will provide final responses to **** of priority written
inquiries within **** calendar days of receipt.

r. Debt Collection Assistance Office - Collection Actions against Beneficiaries

 

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The contractor will meet required response time for problem resolution: ****
within **** days. The date of resolution is the date a final, case-specific
response is furnished to the Debt Collection Assistance Officer (DCAO).

s. Interactive Voice Response (IVR) and Web Availability

The contractor will ensure that access to IVR capabilities will be available to
callers **** of the time.

t. The contractor will ensure the contractor’s web site and its subcontractor’s
web sites will be available **** of the time.

u. TRICARE Service Center Operations

The contractor will establish TRICARE Service Centers within **** miles of the
installation being supported in **** of the situations in which sufficient space
is not available on the installation.

v. The contractor will ensure that an appropriate member of the TSC staff will
be available to meet with the MTF Commander within 24 hours of receiving a
request to meet.

w. The contractor’s staff will update MTF Capabilities and Capacities in MSR
monthly, when significant changes occur such as a service closure, or when
requested by the MTF to make changes, within one working day of verification of
the change.

x. The contractor will ensure that an appropriate member of the TSC staff will
return calls on routine matters from the MTF Commander and senior staff within
one working day.

y. The contractor will establish TSCs such that no less than **** of
Prime-eligible beneficiaries in the entire South Region are within **** miles of
a TSC.

z. The contractor will maintain a sufficient supply of education and marketing
materials, including VA and CHAMPVA materials when provided by the DVA, at all
TSCs such that requests for these materials will be fulfilled **** of the time.

aa. Maps and directions to provider’s practice locations will be available for
**** of network providers.

bb. Health Care Finder Services

Beneficiaries calling the provider locator service to seek a provider will be
directed to a provider 100% of the time.

cc. The contractor will maintain Resource Guides that describe DoD programs and
applicable community, state and federal health care and related resources
available at 100% of the TSCs.

dd. Resource Guides will be updated, at least quarterly, 100% of the time when
information has changed.

ee. Telephone Services

 

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The contractor will operate centralized toll-free customer service centers from
8:00 a.m. to 7:00 p.m., Eastern Standard Time, Monday through Friday (excluding
federal holidays).

ff. Enrollment

The contractor will process 80% of all new enrollment applications and
disenrollment forms (clean, i.e. without system or data errors) within 5
workdays after receipt.

The contractor will process 95% of all new enrollment applications and
disenrollment forms (clean, i.e. without system or data errors) within 8
workdays after receipt.

The contractor will process 100% of all new enrollment applications and
disenrollment forms (clean, i.e. without system or data errors) within 10
workdays after receipt

The contractor will complete 95% of all requests for enrollment processing
corrections (without system or data errors) in 2 workdays after receipt.

The contractor will complete 100% of all requests for enrollment processing
corrections (without system or data errors) in 5 workdays after receipt.

The contractor will ensure that 99% of all enrollment and disenrollment forms
received at the TSC each day will be electronically routed to the contractor
Central Enrollment and Billing Office on the same day, and 100% will be routed
no later than the next working day.

The contractor will make automated outbound calls advising beneficiaries that
their enrollment application processing has been completed on the next working
day following completion of processing of the application 99% of the time. The
contractor will reproduce TRICARE Enrollment and Disenrollment forms and have
them available in 100% of the TSCs, 100% of the time.

Beneficiaries may request enrollment and disenrollment forms by calling the
contractor’s toll-free number and forms will be sent within 5 business days of
the request 98% of the time.

Beneficiaries can obtain enrollment and disenrollment forms from the contractor
web site, which will be available 98% of the time.

The contractor will process active duty enrollments in such a way that the
standards applicable to all other enrollments are met 100% of the time.

The contractor’s Technical Team Leads will quality check 100% of the work
accomplished by new enrollment processors for a minimum of three weeks.

The contractor will update the written agreements that specify PCM assignment
locations for enrollees and are attachments to the MTF-specific Memoranda of
Understanding on a monthly basis.

TSC Managers will notify the contractor’s Central Enrollment and Billing Office
of any changes made to enrollment protocols by MTF Commanders within one
business day, 100% of the time.

gg. Billing

The contractor will make automated outbound calls to enrollees whose accounts
are delinquent to encourage payment beginning on the first business day
following the 16th of the month 99% of the time.

hh. Recruiting and Placement

The contractor requires that Patient Care Coordinators be a licensed RN with at
least 3 years of clinical nursing experience.

 

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SPECIAL CONTRACT REQUIREMENTS

 

The contractor requires that Case Managers be either: a licensed RN with at
least 3 years of clinical experience and 2 years of relevant case management
experience, or a Licensed Master Social Worker (LMSW) with a minimum of three
years clinical experience and a certification in the field of case management,
as recognize by the Case Management Society of America.

The contractor requires that a Quality Management nurse be a licensed RN and
have at least 3 years of clinical experience and 2 years of relevant utilization
review or quality assurance experience.

For Behavioral Health Patient Coordinators, Case Managers and Quality Management
staff, the contractor will require either: a licensed RN with the same years
experience as the Patient Care Coordinators, Case Managers, and Quality
Management clinicians mentioned above, or doctoral level clinical psychologists,
masters level clinical social workers, or masters level marriage and family
therapists with the same years experience as the Patient Care Coordinators, Case
Managers, and Quality Management clinicians mentioned above.

ii. Data Access/Information Management

The contractor will provide mainframe system screen response time for read only
access to claims data in 5 seconds or less, 98% of the time.

The contractor will provide access to the TRICARE DataMart 24/7, except for
scheduled maintenance periods.

The contractor will provide centralized new hire and refresher training to
Government-authorized users each quarter.

The contractor will ensure that TRICARE DataMart users will receive call-backs
to data or functional questions within 4 hours of the initial call 80% of the
time during functional support hours.

The contractor will provide unlimited read-only off-site electronic access to
all TRICARE related data maintained in the contractor’s TRICARE DataMart.

The contractor will make Stoplight and Shoebox reports available online monthly
to MTF staff in the South contract.

The contractor will provide toll-free technical support 24 hours per day/7 days
per week.

Functional support including data format inquiries will be available 8:00 a.m.
to 5:00 p.m. Eastern Standard Time, Monday through Friday, excluding holidays

jj. Information Technology

The contractor will provide automated processes for compliance reporting against
all proposed TMA and contractor standards.

kk. Beneficiary Marketing and Education

 

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SECTION H

SPECIAL CONTRACT REQUIREMENTS

 

The contractor will mail MTF promotional information and TRICARE educational
material, contingent upon availability of the information from TMA, quarterly,
at a minimum, to at least 95% of the beneficiaries who submit a claim for
payment. The contractor will modify the contents of the EOB Tip Sheets to
include information about the quality and availability of services in the MTFs
and market the TRICARE Prime program. The contractor will mail the information,
if available from TMA, with each EOB mailing. The goal is to change the
informational contents of the Tip Sheet quarterly, at a minimum.

The contractor will distribute, through various effective means approved by the
Government, quarterly newsletters and monthly bulletins to all specified
recipients within 15 workdays of receiving the newsletters and bulletins from
TMA.

ll. Provider Marketing

The contractor will distribute, through various means approved by the
Government, quarterly provider newsletters and monthly bulletins to all
specified recipients within 15 workdays of receiving the newsletters and
bulletins.

mm. RESERVED

nn. Case/Disease Management

The diagnostic codes on the referral or authorization entered into MSR will be
checked against the contractor case and disease management list for 100% of
referrals to identify case or disease management candidates. The contractor’s
case managers will attempt initial contact with potential case management
candidates within 3 working days of the case referral date.

The contractor will assign the case to a case manager or coordinator within 1
working day of notification of a nonurgent patient transfer (excludes MTF to MTF
transfers). The contractor staff receiving the referral for case management will
telephonically notify the contractor case manager or coordinator for urgent
transfers. The contractor case manager or coordinator will begin the
coordination within 2 hours of being assigned the urgent transfer case. The
contractor will provide written notice to the beneficiary advising them of the
impending transfer to a network facility or MTF within one working day of the
notification of the transfer decision.

oo. Demand Management

The contractor will make demand management e-health resources available to 100%
of MHS beneficiaries.

pp. Referral Management

Referrals, regardless of source, will be entered into the contractor’s Medical
Service Review (MSR) System 100% of the time.

MSR will verify that the type of service is a TRICARE benefit on every referral
and authorization processed by the contractor.

The contractor will generate a letter to notify beneficiaries when a referral or
pre-authorized service is a noncovered benefit within 1 working day of receipt
of complete referral information.

 

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SPECIAL CONTRACT REQUIREMENTS

 

qq. Prevention and Wellness

The contractor will support improving HEDIS success rates by generating
age/gender specific Health Awareness Letters to 100% of enrolled Prime
beneficiaries with civilian PCMs notifying them of wellness exams and preventive
procedures based on age and gender and recommendations of the U.S. Preventive
Services Task Force. The contractor will mail 6-month follow-up letters to
beneficiary’s PCM if no claims received for the service that was the subject of
the Health Awareness Letter mailing 6 months earlier. On a quarterly basis, the
contractor will submit a report to the Regional Director on the impact of the
Health Awareness Letter program.

rr. Clinical Quality Management Program

100% of urgent potential quality of care issues will be referred to the
contractor Regional Medical Director immediately upon identification. The
contractor will monitor and produce monthly practice pattern profile reports
based on all claims data for a one year period to review the clinical quality of
network providers’ performance. The contractor will close 95% of open potential
quality indicator cases within 60 days of identification.

ss. MTF Collaboration

The contractor will provide each MTF with referral information concerning any
MTF enrollee within 24 hours of issuing a referral. Information related to
urgent care referrals for MTF-enrollees who are referred to a civilian provider
will be communicated within 2 hours. The contractor will conduct orientation
briefings for newly assigned South contract senior Government staff, as
requested.

Contingency Program: The contractor will develop and implement a contingency
program, in conjunction with each MTF, and provide the documented program to the
Regional Director for 85% of the MTFs in the South Region within 3 months
following the start of option period I. The contractor will provide documented
contingency programs for 100% of MTFs within six months following the start of
option period I.

MTF and Network Provider Collaboration: The contractor will facilitate provider
collaboration between MTF and civilian providers to enhance relationships,
optimize MTF care and increase satisfaction. Frequency of these meetings will be
determined through MTF and the contractor collaboration and will be identified
in each MOU. The contractor will participate in all of the meetings, as defined
by the MOU. The contractor will notify civilian network providers, arrange
meeting location and logistics, and facilitate meetings. The contractor will
identify MTF and/or community issues or concerns for discussion and present a
proposed agenda to the MTF Commander two weeks prior to scheduled meeting.

TSC/MTF Process Working Group Meetings: The contractor will facilitate and
participate in TSC/MTF Process Working Groups to enhance collaboration,
integration of services, address issues and/or changes and promote consistent
education of all beneficiary information sources. Frequency and responsibilities
for these meetings will be identified through the contractor and MTF
collaboration and specified in the MOU. The contractor will participate in all
of the meetings, as defined by the MOU. The contractor will facilitate TSC/MTF
Process Working Group Meetings.

 

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SECTION H

SPECIAL CONTRACT REQUIREMENTS

 

Summary of issues, resolutions and ongoing processes will be reported through
Administrative Coordination Meetings.

tt. Network Development

The contractor will submit the Network Implementation Plan 90 Days after
contract award. The plan will include network goals by the contractor-defined
Prime service area. The contractor will provide a region-wide average distance
to a PCM of less than 5 miles, and an average distance to a specialist and
hospital of less than 15 miles. (paragraph 3 deleted) The contractor will
resolve 100% of network inadequacies in accordance with submitted corrective
action plans. The contractor network will be URAC accredited no later than 18
months after the start of health care delivery in the entire South contract
area.

(1) Provider Directory The contractor will maintain an accurate, up-to-date list
of network providers in a web-based format that meets all the requirements in
Paragraph C-7.18. In addition, the contractor will provide TMA designated
entities and MTFs with the following: 1) On-line discrepancy notification
capability; 2) Current reconciliation report that displays status of submitted
discrepancies with corrections accomplished within 3 days of submitted
notification; 3) Up to 20 printed copies of the most current electronic provider
directory on a bi-weekly basis and as requested and 4) Electronic access to
latest printed directory.

(2) Provider Education The contractor will provide at least one on-site visit
annually for each PCM or group of PCMs who have more than 50 beneficiaries
assigned. These visits will address the unique requirements and responsibilities
for PCMs. The contractor will conduct provider orientation / initial provider
education within 30 days of effective date of contract for 98% of new providers.

The contractor will provide two seminars per year, at a minimum, for network
providers and network hospitals in each of the contractor-defined Prime delivery
areas.The contractor will provide one seminar per year for non-network providers
in each of the contractor-defined Prime delivery areas. The contractor will
ensure that network providers are trained in and comply with the provisions of
the President’s Advisory Commission on Consumer Protection and Quality in the
Health Care Industry’s Consumer Bill of Rights and Responsibilities with
particular emphasis on information disclosure, beneficiary participation in
treatment decisions and respect and nondiscrimination.

(3) Provider Relations

When a provider contacts a provider education and relations representative for
assistance in resolving a problem, the provider representative will contact the
provider with a status within 2 workdays, 95% of the time. 100% of the
contractor’s contracted acute care medical/surgical hospitals will be contacted
within 60 days of joining the network and encouraged to become members of the
National Disaster Medical System (NDMS).

uu. Optimization Planning

The contractor will provide initial optimization training to any MTF staff that
has not been trained in the past year no later than the start of health care
delivery. The contractor will provide optimization training to each MTF within
45 days of a request.

 

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SECTION H

SPECIAL CONTRACT REQUIREMENTS

 

vv. Quality Management

The contractor will ensure that for all items entered into the Suspense Control
System, 98% of all required actions will be completed on or before the
established suspense date. The contractor will conduct random monthly telephone
surveys on beneficiary satisfaction, using a sample large enough to obtain 1,500
beneficiary responses in order to yield a statistically significant result with
at least a 90% confidence level with a precision of 2%. The contractor will
conduct random monthly web surveys on beneficiary satisfaction, using a sample
large enough to obtain 150 beneficiary responses in order to yield a
statistically significant result with at least a 90% confidence level with a
precision of 2% when the monthly data is aggregated quarterly.

By the tenth of the month following the month to which the data pertains, the
contractor will calculate a satisfaction “Report Card” for senior leadership
review that tracks and trends specifically identified satisfaction metrics each
month. All TRICARE Network (credentialed) providers will have a criminal history
screening and/or criminal history check prior to beginning service. In addition
to meeting the stated requirement for blockage in the TRICARE Operations Manual,
the contractor will have blockage of no more than 2% of the calls in a weekly
aggregate.

ww. Resource Sharing

The contractor will provide 50% of resource sharing clinical personnel for the
MTF’s credential review within 60 calendar days of receiving the approved
resource sharing agreement, and 100% within 90 calendar days. The contractor
will provide 50% of the administrative support personnel fulfilling the
requirements of the resource sharing agreement within 25 calendar days of
receiving the approved resource sharing agreement, and the remaining 100% within
45 calendar days. The contractor will provide a completed cost analysis for 75%
of the requests within 20 calendar days of receipt of request from the MTF, and
100% within 30 calendar days. The contractor will provide a monthly financial
analysis of each resource sharing agreement, utilizing the evaluation criteria
and financial targets. The contractor will deliver the resource sharing plan
with MTF-specific cost and savings projections within 180 days after contract
award. The contractor will provide a plan for transitioning resource sharing
agreements in prior contracts (which expire prior to or at the start of health
care delivery) within 15 calendar days of the Transition Specifications Meeting.
The plan will address how the contractor will minimize potential disruption and
include gross savings, costs, net savings and reported workload for the most
recent two option periods. The contractor will identify and present
resource-sharing opportunities with estimated gross savings of at least $5
million annually for the area. The contractor will monitor the progress of
accepted agreements and will provide quarterly reports to the Regional Director.
The contractor will conduct a resource sharing capability assessment for each
MTF within 180 days after contract award.

xx. The contractor will:

– be URAC utilization management accredited throughout the contract period

– achieve URAC accreditation for provider network within 18 months of start of
health care delivery

– enhance its Interactive Voice Response (IVR) system to do outbound notice of
completed enrollment, primary care manager changes, and receipt of payment

 

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SECTION H

SPECIAL CONTRACT REQUIREMENTS

 

– update its Central Provider Database every 24 hours; standard-electronic
on-line directory will be current to within 3 calendar days

– provide a minimum of **** TRICARE Service Centers

– notify the beneficiary by telephone for urgent referrals

– use Claim Review in addition to Claim Check

– provide eZ TRICARE free to providers; pay all set-up fees and transaction fees
for network providers

– provide a toll-free telephone access audio library that is available 24 hours
a day, 7 days a week, and has a minimum of 200 healthcare topics available

H.14. Idemnification and Medical Liability

The contractor is responsible for determining the medical malpractice coverage
required in the state (including state risk pools if applicable) for each
network provider (both professional and institutional), and ensuring that each
network provider is in compliance with this standard. In the absence of state
law requirement for medical malpractice insurance coverage, the contractor is
responsible for determining the local community standard for medical malpractice
coverage, and the contractor must maintain the documentation evidencing both the
standard and compliance by network providers. In no case shall a network
provider not have medical malpractice coverage. The contractor agrees to be
solely liable for and expressly agrees to indemnify the government for the costs
of defense and any liability resulting from services provided to MHS eligible
beneficiaries or, in the alternative, the contractor agrees that all network
provider agreements used by the contractor shall contain a requirement, directly
or indirectly by reference to applicable regulations or TMA policies, that the
provider agrees to indemnify, defend and hold harmless TMA and the Government
from any and all claims, judgments, costs, liabilities, damages and expenses,
including attorney’s fees, whatsoever, arising from any acts or omissions in the
provision of medical services by the provider to MHS eligible beneficiaries.
Each network provider agreement must indicate the required malpractice coverage.
Evidence documenting the required coverage of each network provider under the
contract shall be provided to the Contracting Officer upon request. The
Contacting Officer, after consulting with the contractor, retains the authority
to determine whether state and/or local requirements for medical malpractice
coverage have been met by a network provider and whether the contractor has
documented the required coverage.

 

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SECTION I

CONTRACT CLAUSES

 

I.1. 52.252-2 CLAUSES INCORPORATED BY REFERENCE (FEB 1998)

This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available. Also, the full text of a clause may
be accessed electronically at this/these address(es):
http://www.arnet.gov/far/loadmainre.html

(End of clause)

I.2. 52.202-1 DEFINITIONS (DEC 2001)

(Reference 2.201)

I.3. 52.203-3 GRATUITIES (APR 1984)

(Reference 3.202)

I.4. 52.203-5 COVENANT AGAINST CONTINGENT FEES (APR 1984)

(Reference 3.404)

I.5. 52.203-6 RESTRICTIONS ON SUBCONTRACTOR SALES TO THE GOVERNMENT (JUL 1995)

(Reference 3.503-2)

I.6. 52.203-7 ANTI-KICKBACK PROCEDURES (JUL 1995)

(Reference 3.502-3)

I.7. 52.203-8 CANCELLATION, RESCISSION, AND RECOVERY OF FUNDS FOR ILLEGAL OR
IMPROPER ACTIVITY (JAN 1997)

(Reference 3.104-9(a))

I.8. 52.203-10 PRICE OR FEE ADJUSTMENT FOR ILLEGAL OR IMPROPER ACTIVITY (JAN
1997)

(Reference 3.104-9)

I.9. 52.203-12 LIMITATION ON PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS
(JUN 2003)

(Reference 3.808)

I.10. 252.203-7001 PROHIBITION ON PERSONS CONVICTED OF FRAUD OR OTHER
DEFENSECONTRACT-RELATED FELONIES (MARCH 1999)

(Reference 203.570-5)

I.11. 252.203-7002 DISPLAY OF DOD HOTLINE POSTER (DEC 1991)

(Reference 203.7002)

I.12. 52.204-4 PRINTED OR COPIED DOUBLE-SIDED ON RECYCLED PAPER (AUG 2000)

(Reference 4.303)

I.13. 52.204-9 PERSONAL IDENTITY VERIFICATION OF CONTRACTOR PERSONNEL (SEPT
2007)

 

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SECTION I

CONTRACT CLAUSES

 

(Reference 4.1303)

I.14. 252.204-7000 DISCLOSURE OF INFORMATION (DEC 1991)

(Reference 204.404-70)

I.15. 252.204-7003 CONTROL OF GOVERNMENT PERSONNEL WORK PRODUCT (APR 1992)

(Reference 204.404-70)

I.16. 252.204-7004 REQUIRED CENTRAL CONTRACTOR REGISTRATION (NOV 2001)

(Reference 204.7304)

I.17. 252.205-7000 PROVISION OF INFORMATION TO COOPERATIVE AGREEMENT HOLDERS
(DEC 1991)

(Reference 205.470-2)

I.18. 52.209-6 PROTECTING THE GOVERNMENT’S INTEREST WHEN SUBCONTRACTING WITH
CONTRACTORS DEBARRED, SUSPENDED, OR PROPOSED FOR DEBARMENT (JUL 1995)

(Reference 9.409)

I.19. 252.209-7000 ACQUISITION FROM SUBCONTRACTORS SUBJECT TO ON-SITE INSPECTION
UNDER THE INTERMEDIATE-RANGE NUCLEAR FORCES (INF) TREATY (NOV 1995)

(Reference 209.103-70)

I.20. 252.209-7004 SUBCONTRACTING WITH FIRMS THAT ARE OWNED OR CONTROLLED BY THE
GOVERNMENT OF A TERRORIST COUNTRY (MAR 1998)

(Reference 209.409)

I.21. 52.211-15 DEFENSE PRIORITY AND ALLOCATION REQUIREMENTS (SEP 1990)

(Reference 11.604)

I.22. 52.215-2 AUDIT AND RECORDS – NEGOTIATION (JUNE 1999)

(Reference 15.209)

I.23. 52.215-8 ORDER OF PRECEDENCE – UNIFORM CONTRACT FORMAT (OCT 1997)

(Reference 15.209)

I.24 52.215-11 PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA –
MODIFICATIONS (OCT 1997)

(Reference 15.408)

I.25. 52.215-13 SUBCONTRACTOR COST OR PRICING DATA – MODIFICATIONS (OCT 1997)

(Reference 15.408)

I.26. 52.215-15 PENSION ADJUSTMENTS AND ASSET REVERSIONS (DEC 1998)

 

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SECTION I

CONTRACT CLAUSES

 

(Reference 15.408)

I.27. 52.215-18 REVERSION OR ADJUSTMENT OF PLANS FOR POSTRETIREMENT BENEFITS
(PRB) OTHER THAN PENSIONS (OCT 1997)

(Reference 15.208(j))

I.28. 52.215-21 REQUIREMENTS FOR COST OR PRICING DATA OR INFORMATION OTHER THAN
COST OR PRICING DATA – MODIFICATIONS (OCT 1997)

(Reference 15.408)

I.29. 52.216-7 ALLOWABLE COST AND PAYMENT (FEB 2002)

(Reference 16.307(a)

I.30. 252.215-7000 PRICING ADJUSTMENTS (DEC 1991)

(Reference 215.408)

I.31. 252.215-7002 COST ESTIMATING SYSTEM REQUIREMENTS (OCT 1998)

(Reference 215.408(2))

I.32. 252.217-7027 CONTRACT DEFINITIZATION (OCT 1998)

(Reference 217.7405)

I.33. 52.219-8 UTILIZATION OF SMALL BUSINESS CONCERNS (MAY 2004)

(Reference 19.708)

I.34. 52.219-9 SMALL BUSINESS SUBCONTRACTING PLAN (APR 2008) – ALTERNATE II (OCT
2001)

(Reference 19.708(b)

I.35. 252.219-7003 SMALL SMALL DISADVANTAGED AND WOMEN-OWNED SMALL BUSINESS
SUBCONTRACTING PLAN (DoD CONTRACTS) (APR 1996)

(Reference 219.708(b)(1)(A)

I.36. 52.219-16 LIQUIDATED DAMAGES – SUBCONTRACTING PLAN (JAN 1999)

(Reference 19.708)

I.37. 52.222-1 NOTICE TO THE GOVERNMENT OF LABOR DISPUTES (FEB 1997)

(Reference 22.103-5)

I.38. 52.222-3 CONVICT LABOR (JUNE 2003)

(Reference 22.202)

I.39. 52.222-21 PROHIBITION OF SEGREGATED FACILITIES (FEB 1999)

(Reference 22.810)

I.40. 52.222-26 EQUAL OPPORTUNITY (APR 2002)

(Reference 22.810(e))

 

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SECTION I

CONTRACT CLAUSES

 

I.41. 52.222-35 EQUAL OPPORTUNITY FOR SPECIAL DISABLED VETERANS, VETERANS OF THE
VIETNAM ERA, AND OTHER ELIGIBLE VETERANS (DEC 2001)

(Reference 22.1310(a)(1))

I.42. 52.222-36 AFFIRMATIVE ACTION FOR WORKERS WITH DISABILITIES (JUN 1998)

(Reference 22.1408)

I.43. 52.222-37 EMPLOYMENT REPORTS ON SPECIAL DISABLED VETERANS, VETERANS OF THE
VIETNAM ERA, AND OTHER ELIGIBLE VETERANS (DEC 2001)

(Reference 22.1310(b))

I.44. 52.223-6 DRUG-FREE WORKPLACE (MAY 2001)

(Reference 23.505)

I.45. 52.223-14 TOXIC CHEMICAL RELEASE REPORTING (JUNE 2003)

(Reference 23.907)

I.46. 252.223-7004 DRUG-FREE WORK FORCE (SEP 1988)

(Reference 223.570-4)

I.47. 52.224-1 PRIVACY ACT NOTIFICATION (APR 1984)

(Reference 24.104)

I.48. 52.224-2 PRIVACY ACT (APR 1984)

(Reference 24.104)

I.49. 52.225-13 RESTRICTIONS ON CERTAIN FOREIGN PURCHASES (JUNE 2003)

(Reference 25.1103)

I.50. 252.226-7001 UTILIZATION OF INDIAN ORGANIZATIONS AND INDIAN-OWNED ECONOMIC
ENTERPRISES-DoD CONTRACTS (SEP 2001)

(Reference 226.104)

I.51. 52.227-1 AUTHORIZATION AND CONSENT (JUL 1995)

(Reference 27.201-2)

I.52. 52.227-2 NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT
(AUG 1996)

(Reference 27.202-2)

I.53. 52.227-3 PATENT INDEMNITY (APR 1984)

(Reference 27.203-1)

I.54. 52.227-14 RIGHTS IN DATA – GENERAL (JUN 1987)

(Reference 27.409)

I.55. 52.228-7 INSURANCE – LIABILITY TO THIRD PERSONS (MAR 1996)

(Reference 28.311-2)

 

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SECTION I

CONTRACT CLAUSES

 

I.56. 52.229-3 FEDERAL, STATE, AND LOCAL TAXES (APR 2003)

(Reference 29.401-3)

I.57. 52.230-2 COST ACCOUNTING STANDARDS (APR 1998)

(Reference 30.201-4)

I.58. 52.230-6 ADMINISTRATION OF COST ACCOUNTING STANDARDS (NOV 1999)

(Reference 30.201-4)

I.59. 252.231-7000 SUPPLEMENTAL COST PRINCIPLES (DEC 1991)

(Reference 231.100-70)

I.60. 52.232-1 PAYMENTS (APR 1984)

(Reference 32.111)

I.61. 52.232-3 PAYMENTS UNDER PERSONAL SERVICES CONTRACTS (APR 1984)

(Reference 32.111)(a)(3)

I.62. 52.232-8 DISCOUNTS FOR PROMPT PAYMENT (FEB 2002)

(Reference 31.111(c)(1) )

I.63. 52.232-9 LIMITATION ON WITHHOLDING OF PAYMENTS (APR 1984)

(Reference 32.111)

I.64. 52.232-11 EXTRAS (APR 1984)

(Reference 32.111)

I.65. 52.232-17 INTEREST (JUNE 1996)

(Reference 32.617)

I.66. 52.232-18 AVAILABILITY OF FUNDS (APR 1984)

(Reference 32.705-1(a))

I.67. 52.232-20 LIMITATION OF COST (APR 1984)

(Reference 32.705-2)

I.68. 52.232-22 LIMITATION OF FUNDS (APR 1984)

(Reference 32.705-2)

I.69. 52.232-23 ASSIGNMENT OF CLAIMS (JAN 1986)

(Reference 32.806)

I.70. 52.232-25 PROMPT PAYMENT (FEB 2002)

(Reference 32.908(c))

I.71. 52.232-25 I PROMPT PAYMENT (FEB 2002) – ALTERNATE I (FEB 2002)

(Reference 32.908(c)(3))

 

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SECTION I

CONTRACT CLAUSES

 

I.72. 52.232-33 PAYMENT BY ELECTRONIC FUNDS TRANSFER – CENTRAL CONTRACTOR
REGISTRATION (MAY 1999)

(Reference 32.1110)

I.73. 52.232-37 MULTIPLE PAYMENT ARRANGEMENTS (MAY 1999)

(Reference 32.1110)

I.74. 252.232-7009 MANDATORY PAYMENT BY GOVERNMENTWIDE COMMERCIAL PURCHASE CARD
(JUL 2000)

(Reference 232.1110)

I.75. 52.233-1 I DISPUTES (JUL 2002) – ALTERNATE I (DEC 1991)

(Reference 32.215)

I.76. 52.233-3 PROTEST AFTER AWARD (AUG 1996)

(Reference 33.106)

I.77. 52.233-3 I PROTEST AFTER AWARD (AUG 1996) – ALTERNATE I (JUN 1985)

(Reference 33.106)

I.78. 52.237-2 PROTECTION OF GOVERNMENT BUILDINGS, EQUIPMENT, AND VEGETATION
(APR 1984)

(Reference 37.110)

I.79. 52.237-3 CONTINUITY OF SERVICES (JAN 1991)

(Reference 37.110)

I.80. 52.239-1 PRIVACY OR SECURITY SAFEGUARDS (AUG 1996)

(Reference 39.107)

I.81. 52.242-1 NOTICE OF INTENT TO DISALLOW COSTS (APR 1984)

(Reference 42.802)

I.82. 52.242-3 PENALTIES FOR UNALLOWABLE COSTS (MAR 2001)

(Reference 42.709-6)

I.83. 52.242-13 BANKRUPTCY (JUL 1995)

(Reference 42.903)

I.84. 252.242-7000 POSTAWARD CONFERENCE (DEC 1991)

(Reference 242.570)

I.85. 52.243-1 CHANGES – FIXED-PRICE (AUG 1987) – ALTERNATE I (APR 1984)

(Reference 43.205)

I.86. 52.243-2 CHANGES – COST-REIMBURSEMENT (AUG 1987) – ALTERNATE I (APR 1984)

(Reference 43.205)

 

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I.87 52.243-6 CHANGE ORDER ACCOUNTING (APR 1984)

(Reference 43.205)

I.88. 252.243-7001 PRICING OF CONTRACT MODIFICATIONS (DEC 1991)

(Reference 243.205-70)

I.89. 252.243-7002 REQUESTS FOR EQUITABLE ADJUSTMENT (MAR 1998)

(Reference 243.205-71)

I.90. 52.244-2 SUBCONTRACTS (AUG 1998) – ALTERNATE I (AUG 1998)

(Reference 44.204)

I.91. 52.244-5 COMPETITION IN SUBCONTRACTING (DEC 1996)

(Reference 44.204)

I.92 52.245-1 PROPERTY RECORDS (APR 1984)

(Reference 45.106(a))

I.93. 52.245-2 GOVERNMENT PROPERTY (FIXED-PRICE CONTRACTS) (JUNE 2003) –
ALTERNATE I (APR 1984)

(Reference 45.106(b)(2))

I.94. 52.246-25 LIMITATION OF LIABILITY – SERVICES (FEB 1997)

(Reference 46.805)

I.95. 52.248-1 VALUE ENGINEERING (FEB 2000)

(Reference 48.201)

I.96. 52.249-2 TERMINATION FOR CONVENIENCE OF THE GOVERNMENT (FIXED-PRICE) (SEP
1996)

(Reference 49.502)

I.97. 52.249-6 TERMINATION (COST-REIMBURSEMENT) (SEP 1996)

(Reference 49.503)

I.98. 52.249-8 DEFAULT (FIXED-PRICE SUPPLY AND SERVICE) (APR 1984)

(Reference 49.504)

I.99. 52.249-12 TERMINATION (PERSONAL SERVICES) (APR 1984)

(Reference 49.505(b))

I.100. 52.249-14 EXCUSABLE DELAYS (APR 1984)

(Reference 49.505)

I.101. 52.253-1 COMPUTER GENERATED FORMS (JAN 1991)

(Reference 53-111)

I.102. 252.201-7000 CONTRACTING OFFICER’S REPRESENTATIVE (DEC 1991)

 

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(a) Definition. “Contracting officer’s representative” means an individual
designated in accordance with subsection 201.602-2 of the Defense Federal
Acquisition Regulation Supplement and authorized in writing by the contracting
officer to perform specific technical or administrative functions.

(b) If the Contracting Officer designates a contracting officer’s representative
(COR), the Contractor will receive a copy of the written designation. It will
specify the extent of the COR’s authority to act on behalf of the contracting
officer. The COR is not authorized to make any commitments or changes that will
affect price, quality, quantity, delivery, or any other term or condition of the
contract.

(End of clause)

I.103. 52.215-19 NOTIFICATION OF OWNERSHIP CHANGES (OCT 1997)

(a) The Contractor shall make the following notifications in writing:

(1) When the Contractor becomes aware that a change in its ownership has
occurred, or is certain to occur, that could result in changes in the valuation
of its capitalized assets in the accounting records, the Contractor shall notify
the Administrative Contracting Officer (ACO) within 30 days.

(2) The Contractor shall also notify the ACO within 30 days whenever changes to
asset valuations or any other cost changes have occurred or are certain to occur
as a result of a change in ownership.

(b) The Contractor shall–

(1) Maintain current, accurate, and complete inventory records of assets and
their costs;

(2) Provide the ACO or designated representative ready access to the records
upon request;

(3) Ensure that all individual and grouped assets, their capitalized values,
accumulated depreciation or amortization, and remaining useful lives are
identified accurately before and after each of the Contractor’s ownership
changes; and (4) Retain and continue to maintain depreciation and amortization
schedules based on the asset records maintained before each Contractor ownership
change.

(c) The Contractor shall include the substance of this clause in all
subcontracts under this contract that meet the applicability requirement of FAR
15.408(k).

(End of clause)

I.104. 52.216-7 ALLOWABLE HEALTH CARE COST AND PAYMENT (FEB 2002) (DEVIATION)

(a) “Invoicing.” (1) The Government will make payments to the Contractor when
requested as frequently as every Government business day, in amounts determined
to be allowable in accordance with the terms of this contract. The submission of
health care costs that pass the TED edits will be considered an invoice for
reimbursement of health care costs. A contractor invoice for approved resource
sharing expenditures will also be reimbursed as an allowable cost. (2) Contract
financing payments are not subject to the interest penalty provisions of the

 

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Prompt Payment Act. Interim payments made prior to the final payment under the
contract are contract financing payments, except interim payments if this
contract contains Alternate I to the clause at 52.232-25. In the event that the
Government requires an audit or other review of a specific payment request to
ensure compliance with the terms and conditions of the contract, the designated
payment office is not compelled to make payment by the specified due date.

(b) Reimbursing costs. For the purpose of reimbursing allowable costs, the term
“costs” includes only those – (1) submitted on vouchers either for direct health
care costs that, at the time the request for reimbursement has passed the TED
edits, fully or provisionally, or for Government-approved resource sharing
expenditures; and, (2) that the Contractor has actually paid the costs or made
the expenditures by issuing a check, electronic fund transfer, or other form of
actual payment for health care under this contract. The costs eligible for
reimbursement are the health care costs that pass TED edits involving health
care furnished to an eligible beneficiary, health care authorized under TRICARE,
health care furnished by an authorized TRICARE provider, and health care costs
consistent with authorized TRICARE reimbursement methodologies, as well as
Government approved resource sharing expenditures. Costs reimbursed based on
vouchers passing initial TED edits and vouchers for resource sharing costs are
subject to further audit and payment adjustment by the Government if determined
not to qualify as an allowable cost. The Government’s right to audit and recover
costs determined not to be allowable health care costs is in addition to all
rights under the Inspection of Services clause (FAR 52.246-5).

(d) Audit. At any time or times before final payment, the Contracting Officer
may have the Contractor’s invoices or vouchers and statements of cost audited.
“Audits” as used in this clause, includes audits on statistically valid samples.
The audit results will be extrapolated across all the TRICARE medical claims for
the region submitted for TED edits during the audited period to determine the
total overpayment or underpayment of the TRICARE medical claims population
sampled for the region. The results of the audits will be used to adjust for
overpayments and underpayments of health care costs. These adjustments are in
addition to the Government’s rights under the Inspection of Services Clause (FAR
52.246-5). Any payment may be– (1) Reduced by amounts found by the Contracting
Officer not to constitute allowable costs; or (2) Adjusted for prior
overpayments or underpayments.

(e) Final Payment. (1) Upon approval of a completion voucher submitted by the
Contractor, and upon the Contractor’s compliance with all terms of this
contract, the Government shall promptly pay any balance of allowable costs and
that part of the fee (if any) not previously paid.

(2) The Contractor shall pay to the Government any refunds, rebates, credits, or
other amounts (including interest, if any) accruing to or received by the
contractor or any assignee under this contract, to the extent that those amounts
are properly allocable to costs for which the Contractor has been reimbursed by
the Government. Before final payment under this contract, the Contractor and
each assignee whose assignment is in effect at the time of final payment shall
execute and deliver– (i) An assignment to the Government, in form and substance
satisfactory to the Contracting Officer, of refunds, rebates, credits, or other
amounts (including interest, if any) properly allocable to costs for which the
Contractor has been reimbursed by the Government under this contract; and (ii) A
release discharging the Government, its officers, agents, and employees from all
liabilities, obligations, and claims arising out of or under this contract,
except— (A) Specified claims stated in exact amounts, or in estimated amounts
when the exact amounts are not known; (B) Claims (including reasonable
incidental expenses) based upon liabilities of the Contractor to third parties
arising out of the performance of this contract;

 

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provided, that the claims are not known to the contractor on the date of the
execution of the release, and that the Contractor gives notice of the claims in
writing to the Contracting Officer within 6 years following the release date or
notice of final payment date, whichever is earlier.

(End of clause)

I.105. 52.216-10 INCENTIVE FEE (MAR 1997)(DEVIATION)

(a) General. The Government shall pay the Contractor for performing this
contract a fee determined as provided in this contract.

(b) Target cost and target fee. The target cost and target fee specified in the
Schedule are subject to adjustment if the contract is modified in accordance
with paragraph (d) of this clause.

(1) “Target cost,” as used in this contract, means the estimated health care
cost of this contract as initially or subsequently negotiated, or as otherwise
determinable by applying a formula contained in the basic contract, adjusted in
accordance with paragraph (d) below.

(2) “Target fee,” as used in this contract, means the fee initially negotiated
on the assumption that this contract would be performed for a cost equal to the
estimated cost initially negotiated, adjusted in accordance with paragraph
(d) of this clause.

(c) Withholding of payment. Normally, the Government shall pay the fee to the
Contractor as specified in the Schedule. However, when the Contracting Officer
considers that performance or cost indicates that the Contractor will not
achieve target, the Government shall pay on the basis of an appropriate lesser
fee. When the Contractor demonstrates that performance or cost clearly indicates
that the Contractor will earn a fee significantly above the target fee, the
Government may, at the sole discretion of the Contracting Officer, pay on the
basis of an appropriate higher fee. After payment of 85 percent of the
applicable fee, the Contracting Officer may withhold further payment of fee
until a reserve is set aside in an amount that the Contracting Officer considers
necessary to protect the Government’s interest. This reserve shall not exceed 15
percent of the applicable fee or $100,000, whichever is less. The Contracting
Officer shall release 75 percent of all fee withholds under this contract after
receipt of the certified final indirect cost rate proposal covering the year of
physical completion of this contract, provided the Contractor has satisfied all
other contract terms and conditions, including the submission of the final
patent and royalty reports, and is not delinquent in submitting final vouchers
on prior years’ settlements. The Contracting Officer may release up to 90
percent of the fee withholds under this contract based on the Contractor’s past
performance related to the submission and settlement of final indirect cost rate
proposals.

(d) Equitable adjustments. When the work under this contract is increased or
decreased by a modification to this contract or when any equitable adjustment in
the target cost is authorized under any other clause, equitable adjustments in
the target cost, target fee, minimum fee, and maximum fee, as appropriate, shall
be stated in a supplemental agreement to this contract.

(e) Fee payable. (1) The fee payable under this contract shall be the target fee
increased by 20 cents for every dollar that the total allowable cost is less
than the target cost or decreased by 20 cents for every dollar that the total
allowable cost exceeds the target cost. In no event shall the fee be greater
than 10 percent or less than minus 4 percent of the target cost.

 

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(2) The fee shall be subject to adjustment, to the extent provided in paragraph
(d) of this clause, and within the minimum and maximum fee limitations in
paragraph (e)(1) of this clause, when the total allowable cost is increased or
decreased as a consequence of (i) payments made under assignments or (ii) claims
excepted from the release as required by paragraph (h)(2) of the Allowable Cost
and Payment clause.

(3) If this contract is terminated in its entirety, the portion of the target
fee payable shall not be subject to an increase or decrease as provided in this
paragraph. The termination shall be accomplished in accordance with other
applicable clauses of this contract.

(4) For the purpose of fee adjustment, “total allowable cost” shall not include
allowable costs arising out of– (i) Any of the causes covered by the Excusable
Delays clause to the extent that they are beyond the control and without the
fault or negligence of the Contractor or any subcontractor; (ii) The taking
effect, after negotiating the target cost, of a statute, court decision, written
ruling, or regulation that results in the Contractor’s being required to pay or
bear the burden of any tax or duty or rate increase in a tax or duty; (iii) Any
direct cost attributed to the Contractor’s involvement in litigation as required
by the Contracting Officer pursuant to a clause of this contract, including
furnishing evidence and information requested pursuant to the Notice and
Assistance Regarding Patent and Copyright Infringement clause; (iv) The purchase
and maintenance of additional insurance not in the target cost and required by
the Contracting Officer, or claims for reimbursement for liabilities to third
persons pursuant to the Insurance Liability to Third Persons clause; (v) Any
claim, loss, or damage resulting from a risk for which the Contractor has been
relieved of liability by the Government Property clause; or (vi) Any claim,
loss, or damage resulting from a risk defined in the contract as unusually
hazardous or as a nuclear risk and against which the Government has expressly
agreed to indemnify the Contractor.

(5) All other allowable costs are included in “total allowable cost” for fee
adjustment in accordance with this paragraph (e), unless otherwise specifically
provided in this contract.

(f) Contract modification. The total allowable cost and the adjusted fee
determined as provided in this clause shall be evidenced by a modification to
this contract signed by the Contractor and Contracting Officer.

(g) Inconsistencies. In the event of any language inconsistencies between this
clause and provisioning documents or Government options under this contract,
compensation for spare parts or other supplies and services ordered under such
documents shall be determined in accordance with this clause.

(End of clause)

I.106. 52.216-18 ORDERING (OCT 1995)

(a) Any supplies and services to be furnished under this contract shall be
ordered by issuance of delivery orders or task orders by the individuals or
activities designated in the Schedule. Such orders may be issued from 1 April
2011 through 31 March 2012.

 

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(b) All delivery orders or task orders are subject to the terms and conditions
of this contract. In the event of conflict between a delivery order or task
order and this contract, the contract shall control.

(c) If mailed, a delivery order or task order is considered “issued” when the
Government deposits the order in the mail. Orders may be issued orally, by
facsimile, or by electronic commerce methods only if authorized in the Schedule.

(End of clause)

I.107. 52.216-19 ORDER LIMITATIONS (OCT 1995)

(a) Minimum order. When the Government requires supplies or services covered by
this contract in an amount of less than $0, the Government is not obligated to
purchase, nor is the Contractor obligated to furnish, those supplies or services
under the contract.

 

(b) Maximum order. The Contractor is not obligated to honor-

 

(1) Any order for a single item in excess of $****;

 

(2) Any order for a combination of items in excess of $****; or

(3) A series of orders from the same ordering office within 5 days that together
call for quantities exceeding the limitation in paragraph (b)(1) or (2) of this
section.

(c) If this is a requirements contract (i.e., includes the Requirements clause
at subsection 52.216-21 of the Federal Acquisition Regulation (FAR)), the
Government is not required to order a part of any one requirement from the
Contractor if that requirement exceeds the maximum-order limitations in
paragraph (b) of this section.

(d) Notwithstanding paragraphs (b) and (c) of this section, the Contractor shall
honor any order exceeding the maximum order limitations in paragraph (b), unless
that order (or orders) is returned to the ordering office within 10 days after
issuance, with written notice stating the Contractor’s intent not to ship the
item (or items) called for and the reasons. Upon receiving this notice, the
Government may acquire the supplies or services from another source. (End of
clause)

I.108. 52.216-21 REQUIREMENTS (OCT 1995)

(a) This is a requirements contract for the supplies or services specified, and
effective for the period stated, in the Schedule. The quantities of supplies or
services specified in the Schedule are estimates only and are not purchased by
this contract. Except as this contract may otherwise provide, if the
Government’s requirements do not result in orders in the quantities described as
“estimated” or “maximum” in the Schedule, that fact shall not constitute the
basis for an equitable price adjustment.

(b) Delivery or performance shall be made only as authorized by orders issued in
accordance with the Ordering clause. Subject to any limitations in the Order
Limitations clause or elsewhere in this contract, the Contractor shall furnish
to the Government all supplies or services specified in the Schedule and called
for by orders issued in accordance with the Ordering clause. The

 

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Government may issue orders requiring delivery to multiple destinations or
performance at multiple locations.

(c) Except as this contract otherwise provides, the Government shall order from
the Contractor all the supplies or services specified in the Schedule that are
required to be purchased by the Government activity or activities specified in
the Schedule.

(d) The Government is not required to purchase from the Contractor requirements
in excess of any limit on total orders under this contract.

(e) If the Government urgently requires delivery of any quantity of an item
before the earliest date that delivery may be specified under this contract, and
if the Contractor will not accept an order providing for the accelerated
delivery, the Government may acquire the urgently required goods or services
from another source.

(f) Any order issued during the effective period of this contract and not
completed within that period shall be completed by the Contractor within the
time specified in the order. The contract shall govern the Contractor’s and
Government’s rights and obligations with respect to that order to the same
extent as if the order were completed during the contract’s effective period;
provided, that the Contractor shall not be required to make any deliveries under
this contract after 31 March 2012.

(End of clause)

I.109. 52.216-22 INDEFINITE QUANTITY (OCT 1995)

(a) This is an indefinite-quantity contract for the supplies or services
specified, and effective for the period stated, in the Schedule. The quantities
of supplies and services specified in the Schedule are estimates only and are
not purchased by this contract.

(b) Delivery or performance shall be made only as authorized by orders issued in
accordance with the Ordering clause. The Contractor shall furnish to the
Government, when and if ordered, the supplies or services specified in the
Schedule up to and including the quantity designated in the Schedule as the
“maximum.” The Government shall order at least the quantity of supplies or
services designated in the Schedule as the “minimum.”

(c) Except for any limitations on quantities in the Order Limitations clause or
in the Schedule, there is no limit on the number of orders that may be issued.
The Government may issue orders requiring delivery to multiple destinations or
performance at multiple locations.

(d) Any order issued during the effective period of this contract and not
completed within that period shall be completed by the Contractor within the
time specified in the order. The contract shall govern the Contractor’s and
Government’s rights and obligations with respect to that order to the same
extent as if the order were completed during the contract’s effective period;
provided, that the Contractor shall not be required to make any deliveries under
this contract after six (6) months after the end of the respective Option Period
of the contract in which the order was issued. (End of clause)

I.110. 52.217-8 OPTION TO EXTEND SERVICES (NOV 1999)

 

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The Government may require continued performance of any services within the
limits and at the rates specified in the contract. These rates may be adjusted
only as a result of revisions to prevailing labor rates provided by the
Secretary of Labor. The option provision may be exercised more than once, but
the total extension of performance hereunder shall not exceed 6 months. The
Contracting Officer may exercise the option by written notice to the Contractor
within 90 days of contract expiration.

(End of clause)

I.111. 52.217-9 OPTION TO EXTEND THE TERM OF THE CONTRACT (MAR 2000)

(a) The Government may extend the term of this contract by written notice to the
Contractor within 30 calendar days provided that the Government gives the
Contractor a preliminary written notice of its intent to extend at least 60
calendar days before the contract expires. The preliminary notice does not
commit the Government to an extension.

 

(b) If the Government exercises this option, the extended contract shall be
considered to include this option clause.

(c) The total duration of this contract, including the exercise of any options
under this clause, shall not exceed 8 years and 10 months.

(End of clause)

I.112. 52.232-19 AVAILABILITY OF FUNDS FOR THE NEXT FISCAL YEAR (APR 1984)

Funds are not presently available for performance under this contract beyond 30
Sep 2004/ 2005/ 2006/ 2007/ 2008/2009/2010/2011 as applicable to option periods.
The Government’s obligation for performance of this contract beyond that date is
contingent upon the availability of appropriated funds from which payment for
contract purposes can be made. No legal liability on the part of the Government
for any payment may arise for performance under this contract beyond 30 Sep
2004/ 2005/ 2006/ 2007/ 2008/2009/2010/2011 as applicable to option periods
until funds are made available to the Contracting Officer for performance and
until the Contractor receives notice of availability, to be confirmed in writing
by the Contracting Officer.

(End of clause)

I. 113. 252.232-7010 LEVIES ON CONTRACT PAYMENTS (SEP 2005)

(a) 26 U.S.C. 6331(h) authorizes the Internal Revenue Service (IRS) to
continuously levy up to 100 percent of contract payments, up to the amount of
tax debt.

(b) When a levy is imposed on a payment under this contract and the levy will
jeopardize contract performance, the Contractor shall promptly notify the
Procuring Contracting Officer and provide— (1) The total dollar amount of the
levy; (2) A statement that the levy will jeopardize contract performance,
including rationale and adequate supporting documentation; and (3) Advice as to
whether the inability to perform may adversely affect national security,
including rationale and adequate supporting documentation.

(c) DoD shall promptly review the Contractor’s assessment and provide a
notification to the Contractor including– (1) A statement as to whether DoD
agrees that the levy jeopardizes contract performance; and (2) If the levy
jeopardizes contract performance and the lack of performance will adversely
affect national security, the total amount of the monies collected that

 

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should be returned to the Contractor; or (3) If the levy jeopardizes contract
performance but will not impact national security, a recommendation that the
Contractor promptly notify the IRS to attempt to resolve the tax situation.

(d) Any DoD determination under this clause is not subject to appeal under the
Contract Disputes Act.

(End of clause)

I.114. 52.243-7 NOTIFICATION OF CHANGES (APR 1984)

(a) Definitions. “Contracting Officer,” as used in this clause, does not include
any representative of the Contracting Officer. “Specifically Authorized
Representative (SAR)”, as used in this clause, means any person the Contracting
Officer has so designated by written notice (a copy of which shall be provided
to the Contractor) which shall refer to this subparagraph and shall be issued to
the designated representative before the SAR exercises such authority.

(b) Notice. The primary purpose of this clause is to obtain prompt reporting of
Government conduct that the Contractor considers to constitute a change to this
contract. Except for changes identified as such in writing and signed by the
Contracting Officer, the Contractor shall notify the Contracting Officer in
writing promptly, withing 30 calendar days from the date that the Contractor
identifies any Government conduct (including actions, inactions, and written or
oral communications) that the Contractor regards as a change to the contract
terms and conditions. On the basis of the most accurate information available to
the Contractor, the notice shall state— (1) The date, nature, and circumstances
of the conduct regarded as a change; (2) The name, function, and activity of
each Government individual and Contractor official or employee involved in or
knowledgeable about such conduct; (3) The identification of any documents and
the substance of any oral communication involved in such conduct; (4) In the
instance of alleged acceleration of scheduled performance or delivery, the basis
upon which it arose; (5) The particular elements of contract performance for
which the Contractor may seek an equitable adjustment under this clause,
including – (i) What contract line items have been or may be affected by the
alleged change; (ii) What labor or materials or both have been or may be added,
deleted, or wasted by the alleged change; (iii) To the extent practicable, what
delay and disruption in the manner and sequence of performance and effect on
continued performance have been or may be caused by the alleged change;
(iv) What adjustments to contract price, delivery schedule, and other provisions
affected by the alleged change are estimated; and (6) The Contractor’s estimate
of the time by which the Government must respond to the Contractor’s notice to
minimize cost, delay or disruption of performance.

(c) Continued performance. Following submission of the notice required by
paragraph (b) of this clause, the Contractor shall diligently continue
performance of this contract to the maximum extent possible in accordance with
its terms and conditions as construed by the Contractor, unless the notice
reports a direction of the Contracting Officer or a communication from a SAR of
the Contracting Officer, in either of which events the Contractor shall continue
performance; provided, however, that if the Contractor regards the direction or
communication as a change as described in paragraph (b) of this clause, notice
shall be given in the manner provided. All directions, communications,
interpretations, orders and similar actions of the SAR shall be reduced to
writing promptly and copies furnished to the Contractor and to the Contracting
Officer. The Contracting Officer shall promptly countermand any action which
exceeds the authority of the SAR.

 

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(d) Government response. The Contracting Officer shall promptly, within 30
calendar days after receipt of notice, respond to the notice in writing. In
responding, the Contracting Officer shall either – (1) Confirm that the conduct
of which the Contractor gave notice constitutes a change and when necessary
direct the mode of further performance; (2) Countermand any communication
regarded as a change; (3) Deny that the conduct of which the Contractor gave
notice constitutes a change and when necessary direct the mode of further
performance; or (4) In the event the Contractor’s notice information is
inadequate to made a decision under paragraphs (d)(1), (2), or (3) of this
clause, advise the Contractor what additional information is required, and
establish the date by which it should be furnished and the date thereafter by
which the Government will respond.

(e) Equitable adjustments. (1) If the Contracting Officer confirms that
Government conduct effected a change as alleged by the Contractor, and the
conduct causes an increase or decrease in the Contractor’s cost of, or the time
required for, performance of any part of the work under this contract, whether
changed or not changed by such conduct, an equitable adjustment shall be made—
(i) In the contract price or delivery schedule or both; and (ii) In such other
provisions of the contract as may be affected. (2) The contract shall be
modified in writing accordingly. In the cased of drawings, designs or
specifications which are defective and for which the Government is responsible,
the equitable adjustment shall include the cost and time extension for delay
reasonable incurred by the Contractor in attempting to comply with the defective
drawings, designs or specifications before the Contractor identified, or
reasonably should have identified, such defect. When the cost of property made
obsolete or excess as a result of a change confirmed by the Contracting Officer
under this clause is included in the equitable adjustment, the Contracting
Officer shall have the right to prescribe the manner of disposition of the
property. The equitable adjustment shall not include increased costs or time
extensions for delay resulting from the Contractor’s failure to provide notice
or to continue performance as provdied, respectively, in paragraphs (b) and
(c) above.

NOTE: The phrases “contract price” and “cost” wherever they appear in the
clause, may be appropriately modified to apply to cost-reimbursement or
incentive contracts, or to combinations thereof.

(End of clause)

I.115. 52.244-6 SUBCONTRACTS FOR COMMERCIAL ITEMS (APR 2003)

(a) Definitions. As used in this clause–

“Commercial item” has the meaning contained in the clause at 52.202-1,
Definitions.

“Subcontract” includes a transfer of commercial items between divisions,
subsidiaries, or affiliates of the Contractor or subcontractor at any tier.

(b) To the maximum extent practicable, the Contractor shall incorporate, and
require its subcontractors at all tiers to incorporate, commercial items or
nondevelopmental items as components of items to be supplied under this
contract.

(c)(1) The Contractor shall insert the following clauses in subcontracts for
commercial items:

(i) 52.219-8, Utilization of Small Business Concerns (OCT 2000) (15 U.S.C.
637(d)(2) and (3)), in all subcontracts that offer further subcontracting
opportunities. If the subcontract (except subcontracts to small business
concerns) exceeds $500,000 ($1,000,000 for construction of any public facility),
the subcontractor must include 52.219-8 in lower tier subcontracts that offer

 

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SECTION I

CONTRACT CLAUSES

 

subcontracting opportunities. (ii) 52.222-26, Equal Opportunity (Apr 2002) (E.O.
11246). (iii) 52.222-35, Equal Opportunity for Special Disabled Veterans,
Veterans of the Vietnam Era, and Other Eligible Veterans (Dec 2001) (38 U.S.C.
4212(a)); (iv) 52.222-36, Affirmative Action for Workers with Disabilities (JUN
1998) (29 U.S.C. 793). (v) 52.247-64, Preference for Privately Owned U.S.-Flag
Commercial Vessels (APR 2003) (46 U.S.C. Appx 1241 and U.S.C. 2631) (flow down
required in accordance with paragraph (d) of FAR clause 52.247-64).

(2) While not required, the Contractor may flow down to subcontracts for
commercial items a minimal number of additional clauses necessary to satisfy its
contractual obligations.

(d) The Contractor shall include the terms of this clause, including this
paragraph (d), in subcontracts awarded under this contract.

(End of clause)

I.116. 52.252-6 AUTHORIZED DEVIATIONS IN CLAUSES (APR 1984)

(a) The use in this solicitation or contract of any Federal Acquisition
Regulation (48 CFR Chapter 1) clause with an authorized deviation is indicated
by the addition of “(DEVIATION)” after the date of the clause.

(b) The use in this solicitation or contract of any Defense Federal Acquisition
Regulation Supplement (48 CFR Chapter 2) clause with an authorized deviation is
indicated by the addition of “(DEVIATION)” after the name of the regulation.

(End of clause)

I.117. 52.203-13 CONTRACTOR CODE OF BUSINESS ETHICS AND CONDUCT (DEC 2008)

I.118. 252.222-7006 RESTRICTIONS ON THE USE OF MANDATORY ARBRITRATION AGREEMENTS

(May 2010)

I.119. 252.203-7003 AGENCY OFFICE OF THE INSPECTOR GENERAL (SEP 2010)

 

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