CORHQ-13-C-0148 

7. FOR SOLICITATION 

INFORMATION CALL: 

Dl'ITE 

0:../01/2014 

3. 

COD£ 

Federal Deposit Ineurance corporation 

DOA/ASE 

3501 Fairfax Jrive 

Arlington, VA 22226 

11 DELIVEHY fOR F06 PESllNl'I· 

:tOrHJNL·:S~ BLOCK IS 

MARKED 

Ee SCHEOIJLE 

lS. 0EUVfR TO 

Loui~e Murrill-Gravco 

coor 

OFFtAOA CODE 0000000537 fACILln' . CODE 

BEI-JEFIT AL-001, SE:NEFIT ALLOCATION 

S1STEM£, I~C, 132 IVY LANE, KING OF 

,P)W§$IA, ,PA 13406-:?,HS 

ELEPHONf NO. 

• 17~. CHECK If ~EMITTANCE 15 OlfFrAENT AND~UT SUCH ADDRESS IN 

0Ff€R 

',9. 

ITEM NO. 

20. 

SCHEDULE OF SUPPLIE5iSERV:CES 

aooi Benefits Administrator 

l . N!A. 

l7, SOLICITATION INC.UD!:S ATTACHMENTS 

l7b.AWARO INCLUOESATTAC~MENrS ----~ (b)(6) 

~J. 5971 p' 2 

Page 1 

ASBCC-13 -0 0695 

10. SOCIO·( 

[8]NO • YES 

NAICS: 9,1512 

ETrlNICITY: 

ll•. Sl)B-C0NTRACTING 

PERMITTED/AP PROVED 

TUWB 

J.i.rncs Thompson 

70)-562-2593 

LOCAL TIME 

• SOB • MW00 

. • SERVICE·DISA6L€0 VETERl'INOM-!EO SMALL Sl/SINESS 

(ODE 

coot 

Federal Jepo9it Insurance Corporation 

DOF/AP. 

~OFAP!NVOICE~FDIC.gov 

21. 24. 

QUAt,/l'iT\' 

n. 

UNIT 

2), 

UNIT P~ICE AMOUNr 

J. EA Sl1,49S,954.00 

,a, TOTAL AWt,J:/;O AMOUNT (,or Go,t, u,a Only) 

$11,488,954_00 

l9.AWMD0FCONTRACf: Rff 

YOUR OFFER ON50LICITA'10N 

YES 

YE!I 

NO 

NO 

- ------OFFER 

(b )(6) 

l&. CONTRACTOR ,s Rl'QUI/Ucll TO ,IGNTHIS DOCUMEITT ANO RE"UfiN 

~---_.J._.....__co __ PLES 10 l>>Ui_NG OHi(€, (O~'TRACTORAGRl:E.i TO FURNl.ioi Al>lO 

., Of~ SEf fO_R:H Q~ OTHE~WISE_ IPE,NTJFIEO ~30VE AN9. ON A/:lY ADDfTIONAl 

SHEETS SUBJECT ,~ITIONS SPECIFIEO 

(BLOCK SJ. JNCI.UOING .A!W P,p01JIOt,IS <:JR C>-IANG.ES ,WHICH .AA£, ~•T.f91JT~. ,. , ... ,. ,, ,, .... , .. , .. , .. f!EAEIN, I.S ACCEPTED A~ TO mMS: ' 

o~- 'g-J-1'] Marcelle C. Brown 08/01./2D13 

FDIC 3700/66 (3-08) r 

I 

CORHQ-13-C-014 0 f 
Page 2 PAGE 2 OF 132 

19, 20. 21. 2.2. 23. 24. 

ITEMNO . SCHEDULE OF SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT 

.l.ta. QUAN< 11 T IN .vLU'"'" l l HA> D<<I' 

•INSPECTED • ACCEPTED, AND CONFORMS TO THE CONTRACT, EXCEPT AS NOTED: 

REPRESENTATIVE 

329. 

• COMPLETE • PARTIAL • FINAL 

41 a. I CERTIFY THIS ACCOUNT IS CORRECT AND PROPER FOR PAYMENT 42a. 

FDIC 3700/55 (3-08) 

CORHQ-13-C--0148 
Page 3 PAGr' 3 OF 137 

Section B - Supplies or Services and Prices/Costs 

Attachments for this section start after this page. 

UJRHQ-13--C-()148 
CORH0-13-C-0148 

Page 4 

Benefit Allocation Systems, Inc. 

Response to Solicitation # CORHQ-13-R-0069 

Volume !II - Pricing Proposal 

Firm's Name: 

Contact Person; 

Address: 

Telephone: 

Facsimile: 

Taxpayer I.D. Number: 

RFP Number: 

Proposal Volume: 

Date Submitted: 

Proposal Due Date: 

PROPOSAL COVER PAGE 

Volume Ill - Pricing Proposal 

Benefit Allocation Systems, Inc. 

Arthur S. Taylor, President 

132 Ivy Lane 

P.O. Box 62407 

King of Prussia, Pennsylvania 19406 

(610) 992-2500 

(610) 992-2501 

23-2635985 

CDRHQ-13-R-0069 

II - Pricing Proposal 

May 23, 2013 

May 29, 2013 
CORilO 13-C 0148 

Page 5 

Table of Contents 

Pricing Grids 

Audited Financials Years Ended December 31, 2012 ;ind 2011 ... 

Audited Financials Years Ended December 31, 2011 and 2010 

Bank Reference Letter .... 

Tab 1 

.. Tab 2 

..... Tab 3 

.. Tab 4 

?AGE 5 OF 132 
COC::IIO-13-8.--00!18 

Page 6 

Attach B - 1 Price Schedule 

Summarv 

Third Party Administrator Services 

(Employee Benefits and Training Programs) 

The Third Party Administrator Services contract shall contain a "transition period'' from August 

l. 20 I 3 through Dcccmhcr J 1, 2013. in which there will be two contracts in operaticm. The 

'·transition period" is necessary to coordinate the "start-up·· proccs~cs if the contract is a\vardcd 

to a new vendor. During the '·transition period''. the existing contractor will continue to provide 

employee benefits administration services that include online enrollment processes and a myriad 

of administrative support services, in addition to transferring data necessary for "stai1-up'' in the 

event that the contract is awarded to a new vendor. 

The fully-operational Period of Pcrfonnance for a three-year base contract shall commence on 

January 1. 2014 and end on December 3 l, 2016. The contract shall also contain two (_2) one-year 

option periods for a possible extension by FD1C through December 31. 2018. 

CUN DESCRJl'TJON cc~~---t~-----~-~~ -- ---· --------------~ 

000 l Start-Up Costs for NC\\' Vendor During Transition Period 

(August I, 2013 -- December 31. 2013) 

Proposed ·1.ransitional .. cosb \Vil I cover 

expenses incurred for: 

• Travel expenses (transportation, lodging) 

for site visits to FDIC ( kadquarters and 

the National Finance Center, as necessary 

• Vendor staff labor costs for systems 

development/programming and 

implementation or administrative 

services 

• Communications 

Total proposed fixed price for this period 

$ 0.00 

CJ.IN I DESCRIPTION 

f-----~-·· 

·---------------------

0002 Period of Perfonnancc January I, 2014 -- December 31, 2016 

The total proposed cost to fund a new contract for employee hcnefits and training 

programs for thc __ threc year base period. 

0002A Benefits Program See Appendix A $ 5,628.927.45 

----·-------------+-------------, 

00028 Professional Learning Accounts Sec Appendix C $ J3 l ,360.00 

?AGC II or ,3,7 
CORHQ-13-8-00@9 

Page 7 

i DESCIUYI'ION 

' [CL!'\ 

j 0003 : ~irst One-Year Option Period (January l. 2017 - December 3L201 7) 

i j The total proposed cost to fund a new contract for employee benefits and training 1 

programs for the first one-year op_tic_)!l_F0Cccc;ocd~.------------------

: 0003A 

i 

, Benefits Program Administration Sec Appendix B $1,928,932.72 

~---~------- - --- - ----- ------------------

i 00038 

I 

Professional Learning Accounts See Appendix C 

CUN i DESCRIPTION 

$ 181,840.00 

0004 i Second Onc-Y car Option Period (January 1. 2018 December 31, 2018) 

•, The total proposed cost to fund a new contract for employee benefits and training 

I programs for the second one-year o Jtion period. ~---~------"'-------------- -------~-~--~------

! 0004A I Benefits Program Administration See Appendix B $ 1,954,967.38 

I 0004B -: Professional Learning Accounts Sec Appendix C 

l ___ -- . 

DESCRIPTION 

The total proposed price for this requirement including transitional 

period, three-year base period and two one-year option periods 

, (if exe_rcised_)_:_ 

$ 183,964.00 

TOTAL PRICE 

$ 10-409,991.55 

PAGF ll or 112 
Page 8 

APPENDIX A 

FDIC THIRD PARTY ADMINISTRATOR SERVICES 

(EMPLOYEE BENEFITS PROGRAMS) 

COST ESTIMATE FOR BASE YEAR ONE(l) (l/l/2014 - 12/31/2014) 

(A) (B) (C) 

Service Description Participant Per Participant Proposed Annual Cost 

Count/ Cost (11onthly) (A *B) * 12 

Quantity 2014 

Section 125 Cafeteria Plan 

Ad.mini.strati on - Actives 7700 ?AO 683,760 

Benefits Hotline Call Center -

Actives 7700 3.95 364,980 

Evidence of Insurability 

Processing 200 7.00 16,800 

Retiree & Surviving Dependent 

Database Administration 4000 3.65 175,200 

Benefits Hotline Call CenterRetirees & Surviving 4000 3.95 189,600 

Dependents 

DentaWision ID Card 

Preparation and Issuance 175 4.70 9,870 

Flexible Spending Account 

Administration 

✓ Health Care 2800 4.60 154,560 

✓ Dependent Care 80 4.60 4,416 

✓ Health & Dependent 325 5.00 19,500 

✓ Parkjng 30 4.50 1,620 

Domestic Paitner Processing 180 1.00 2,160 

Retiree Dental Billing -

Retirees & Surviving 3500 3.75 157,500 

Dependents 

HeaJth Benefits Premium 

Reimbursement/ Retirees 775 2.00 18,600 

Monthly Meeting Travel 

Expenses NIA NIA 20,000 

Modifications/Special Services N/A NIA 30,000 

Total Proposed Cost for Base 

Period Year One (1) $ 1 ,848,566 

Participant quamities identified above are estimcnes. rhe approved fixed uni/ prices will be applicable regardless of the quantiry 

and actual quantities may be higher or lower than estimated. 

CORHQ-13-&-0~~8 

PAGE 8 OF 1l2 
Page 9 

APPENDIX A (CONT) 

fDIC TIIIRD PARTY ADMINISTRATOR SERVICES 

(EMPLOYEE BJ:NLFITS PROGRAMS) 

COST ESTIMATE fOR!_lASE YEAR TWO (2) (1/1/2015 - 12131/2015) 

----- -----------------~--~--~---·-

(A) (B) 

Service Description Participant Per Participant 

Count' Cosl (Monthly) 

t-c~~-~------ Quantitv 2015 

(C) 

Proposed Annual Cost 

(A*BJ* 12 

Scction 125 Cafeteria Plan 

Administration Actives 

Hcnefils 1-Tot!inc Call CenterActives 

_ 0 ___ 1~1~0~0----ll-~1~.s~1-----l--- 693.924.oo 

i 

7700 ' 4.01 370,524.00 

Fvidenee of lnsurahility I 

Processing 200 ______ ] ____ ~7.~l~l-------l---1~7~,0~6~4~.~0~0 __ _ 

Retiree & Surviving Dependent I 

ccl~la_Ll<_· _b~a_sc~· ~A_d~m~;n_;~,_t,~a~t;~o_o ____ _,_ __ 4000 __ _j_ _ 

Benefits Hotline Call CenterJJ.0 0 __ --+-_~1~77~,~60~0~. O~O~--

- F{_ct_i_rec_s ~5!-1_1_'.':'.~~'.~ng Dependents 4000 I 4.0 I 

~-~~-----j------~---

Dental/Vision ID Card , 

---~19~2~,4~8~0~.0~0 __ ~ 

Preparation an~--!~-~uar_1cc 175 4.77 10,017.00 I -----+------+-------t--

F lc xi b !c Spending Account I 

Administration I 

✓ Health Care 2800 1 4.67 156.912.00 I ✓ Dependent Care 80 i 4.67 4,483.20 

✓ Health & Dependent 325 5.08 19,812.00 

✓ i _________ --~P~a~•·k~;~n~"~-------t-- 30 , 4.57 ____ +---~'~•~6~4~5~.2~0~---

Domestic Partner Proces_~_i!1g 

Retiree Dental Billing -

--+--~1 ~80~---~l.~0~2 __ ----J-___ 2.203 .20 -- ____ j 

' : 

_Rctirc<.:s & Surviving Dependents 3500 - - 3:?_1 __ ---'_-~16~0~-~02~0~.~oo~---' 

Health Benefits Premium ' ' Reimhursemcnt/ Retirees 775 

Monthly Meeting Travel 

i 2.03 18,879.00 

Expenses___ N/A N/A 1 0.300.00 

Modificati-o-ns-/~S-p-cc~;-a~I ~S-en-0~,j __c_e_s_---1---N~!_-(\-____ -_-_-:_,-:_-:_-:::-_N_1_A __ ---1-____ J0_,~4_5_0_.0_0 __ _ 

Total Proposed Cost for Rase 

Period Year Two (2) $ 1,876,313.60 ~--~~~--~~~-~~-----'--

l'anw1p,ml quu.n/1/,es ,dent(/ted a hove are eshmaJcs, the appro,,,,J_fiud um/ pria.1· ,v,l/ hi! app!,caMe r<"gardle.\·s of lhP 

qum,lil) and nc/ua! quantities may be hrgher or lower than cs1imat,:d 

CORHQ-13-8-00§8 

r'i-..G[ Ii CJF 131 
Page 10 

APPENDIX A (CONT) 

fDIC THIRD PARTY ADMINISTRATOR SERVICES 

(EMPLOYEE BENLFITS PROGRAMS) 

COST ESTIMATE FOR BASE YEAR THREE(]) (l /1/2016 -- 12/31/2016) 

-------------------------.. -- -----~-----------

(A) (B) 

Service Description Participant Per Participant 

Count/ Cost (Monthly) 

Quantity 2016 f---------- --~-~--~-+--------

Section 125 Cafeteria Plan 

Administration Actives 

Hencfits flotlinc Call CenterActives 

Evidence of Jnsurahility 

Proccssmg 

Retiree & Surviving 

Dependent Database 

Administration 

--

Hencfits Hotline Call Center -

Retirees & Surviving 

Dependents 

i 

I 

' i 

Dental/Vision ID Card i 

7700 7.62 ---------+-------+ 

7700 4.07 

200 7.21 - -

4000 3.76 

4000 4.07 

(C) 

Proposed Annual Cost 

(A*B)* 12 

----

704,088.00 - ----

376_()68.00 

I -

I 7.304.00 

180-480.00 

---------

I 95.360.00 

Preparation and Issuance ______ j ________ 1_7_5 __ -+ __ 4_.8_4 ___ +-___ J( __ l,~l_6_4_.0_0 ___ -C 

.Flexible Spending Account : 

Administration I 

✓ Health Care 

✓ Dependent Care 

✓ l Icalth & Dependent 

! 2800 4.74 

I 80 4.74 

i

i 325 5.15 

✓ Parking ___ _,_ ________ 30 4.64 -----

Retiree Dental Billing --

Retirees & Surviving 

_ l )(:pendents 

3500 3.86 

------ - ---

159,264.00 

4,550.40 

20Jl85.00 

1,670.40 -- -- .. -

162,120.00 

f !calth Benefits Premium 

Reimbursement/ Retirees 

Monthly Meeting Travel 

Expenses 

Modifications/Special Senriccs 

775 2.0_~-- --+--~19~-~'~'~8-~0~0 ____ j 

N/A N/A 1 0,604.50 

~/A NIA 30,906.75 - --------~-----0 

Total Proposed Cost for Base 

Pcri()d Y car Thre<: (3J __ ~--~--~--~' -,------ Parncrpam quan/1/Jes uienn/ird abow arf' f'.,·l,mwes, the approl'edfued um! pnccswd! he app/zcrible rcga,dl,,ss o_f the quantity 

J$ l,904,047.85'• _ 

and (1(:/ua/ quamirie.,· muy lw l11gher or lower than estimalcd. 

*Note: It appears '::he grid a:Oove mistakenly omitteC. a row for 

"Domestic rx,tncr P:c:-c:icessing" ;:r:'..cing si::1cc a1 l other has,: ard 

PAGC 10 OF 132 

opt.::..::::m year grid temp] ates inc-'-;__;_cie tne line item. Therefore, our price 

wi 1.1 be $~.CJ. We :'._:r:.cluded L1.'..s ;:r~c:e for ::.sc participants 

CORHO-13-C-0148 

annualized - - 2, 27-1. 8,J - - i:r. the ';:'otal Proposed Ccst fc,r Base PeTiod 

Year Tt~ree. 
APP~:NDIX Il 

Page 11 

FDIC THIRD PARTY ADMINISTRATOR SERVICES 

(EMPLOYEE BENErlTS PROGRAMS) 

COST ESTJMAIE FOR FIRST OPlfO'I YEAR (1/1/2017 - 17/31.'7017) 

Service Description 

(A) 

Participant 

Count/ 

Quantitv 

-----------~---~----T (B) Proposed Annual Total Cost 

Per Pa11ieipant Cost First Option Y car 

Cost(Monthly) (A*B)*l2 

2017 2017 ~ 

Section 125 Cafeteria Plan 

Administration - Actives 7500 7.74 

~~--t-------j------

Bcncfits Ilotlinc Call 

-- _§96,600.00 

Center -- Actives 

Evidence of Insurnbility 

Processing__ 

371,700.00 --j-------jf-------+--- 7500 4.13 

17,568.00 1-----t-------+--- 200 7.32 

4200 3.82 ! 92,528.00 

696,600.00 

---- _371_700.00 

17,568_.0_0_ 

192,528.00 

Retiree & Surviving 

Spouse Database 

Administration ---- - ---t-----+-------- ---+----

Benefits I Iotline Call 

Center- Retirees; & 

-~-~rvivinQ Dcpcnde11ts 

Dental/Vision ID Card 

4200 4.13 

_!l~i::par'.1tion and l_s~_l:1-cl_!!Ce ----j------+-------+-

flexib!c Spending Account 

175 4.91 

Administration 

✓ Health Care 

✓ Dependent Care 

✓ Health & 

Dependent 

✓ Pai~tl_r:ig _ 

Domestic Partner 

Processmg 

Retiree Dental BillingRetirees & Surviving 

2800 4.81 

85 4.81 

325 5.23 

30 4.71 

190 1.05 

3600 3.92 

_Dependents __ --------+-----+-------+--

Health Benefits Premium 

c.cR~c~i1~11~b~u~rs~c~rn~c~n~t_i '~'~et~ir~e~e~s-+-_ 775 

Monthly Meeting Travel 

'.09 

Exncnscs N/l\ N/A cc===-------+-~=~-- -- ------- Mod ifi ca ti ons/S peci al 

Services N/A N//\ ----------- ------+--~~-+---

Total Proposed Cost for 

208, l 52.00 

1_0,311.00 

161.616.00 

4,906.20 

20,397.00 

1,695.60 

2,394.00 

169,344.00 

208, I 52.00 

161.616.00 

4,906.20 

20,]97.00 

1,695.60 

2.394.00 

169,344.00 

-----+-------- -------

l 'J.437.00 19,437.00 

20,913.57 20.913.57 

31,370.35 31370.35_, 

~_i!~!__Op!i()_~ __ y_c~r ____ +-----~-----~-1, 928,932.72 $ 1,928,932.72 

C:JR~~O-13-B-0lll>S 

l'articipanl q1u_mt1tics idenlificd above are eslimmes. the approvedfi.ud ww pricer will he applicable ,e,sard/ess o/ the q11a111ily 

and ac/ua! quw1/1fit's muy 1:,,. hir:hcr or lower than es11ma1ed 
Page 12 

APPENDIX B (CONT) 

FDTC TIIIRD PARTY ADMlNISTRATOR SERVICES 

(EMPLOYEE BENEFITS PROGRAMS) 

COST ESTIMATE FOR THE SECOND OPTION YEAR(l/l/2018 - 12/31/2018) 

(A) (B) Proposed Annual Total Cost 

PAGE 10 OF 1l2 

Service Description Participa11t Per Pruticipant Cost Second Option 

Count/ Cost (Monthly) (A*B) * 12 Year 

Quantity 2018 2018 

Section 125 Cafeteria Plan 

Administration - Actives 7500 7.85 706,500.00 706,500.00 

Benefits Hotline Call. Center 

-Actives 7500 4.19 377,100.00 377,100.00 

Evidence of Insurability 

Processing 200 7.43 17,832.00 17,832.00 

Retiree & Surviving Spouse 

Database Administration 4200 3.87 195,048.00 195,048.00 

Benefits Hotline Call Center 

- Retirees & Surviving 4200 4.19 211,176.00 211,176.00 

Dependents 

DentalNision ID Card 

Preparation and Issuance 175 4.99 8,799.00 8,799.00 

Flex.ible Spending Account 

Administration 

✓ Health Care 2800 4.88 163,968.00 163,968.00 

✓ Dependent Care 85 4.88 4,977.60 4,977.60 

✓ Health & Dependent 325 5.31 20,709.00 20,709.00 

✓ Parking 30 4.78 1,720.80 1,720.80 

Domestic Partner Processing 190 1.06 2,416.80 2,416.80 

Retiree Dental BillingRetirees & Surviving 3600 3.98 171,936.00 171,936.00 

Dependents 

Health Benefits Premium 

Reimbursement/ Retirees 775 2.12 19,716.00 19,716.00 

MonthJy Meeting Travel 

Expenses NIA NIA 21 227 . 27 21,227.27 

Modifications/Special 

Services NIA NIA 3 l ,840.9l 31 840.91 

Total Proposed Cost for 

Second Option Year $ 1,954,967.38 $ 1,954,967.38 

Participant quantities identified above are estimates, the approved fixed unit prices will be applicable regardless of the quantity 

and actual quamities may be higher or lower than estimated 

CORHQ-13-8 -00"8 
Page 13 

APPENDIX C 

FDIC THIRD PARTY ADMINISTRATOR Sl:RVICES 

(PROFESSIO'lAL LEARNING ACCOIJNTS PROGRAM) 

PROPOSED COST HlR BASE PFRIOIJ YEAR ONE (I) (Ill/:2!114 - 12131/20141 

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

(A) 

Service Description Participant 

Count/ 

Quantity 

Profcs~ional Learning 

Accounts Administration 5900 

Modi fications/Spccial 

Services NIA 

Quarterly Meeting 

·i ravel Lxncnscs NIA -----

Total Proposed Cost for 

~_as~ Period Year One (I) ------

-,--

! 

• 

( B) 

11icipant 

Monthly) 

014 

Per Pa 

Cost ( 

2 

2. 20 

(C) 

Proposed Annual 

Cost 

(A*G) * 12 

155,760.00 

----- N/A --f-----1_1~,0~0_0_.0_0 __ 

N/A 6,000.00 

$ 174,760.00 

f'arlicipan/ qua,1/1/il's ulcntific,d uhove are es/1mu/cs. the approved fb .. cd um/ prices will ht> applicahle regardless o.f the quanti~)' 

and t1dut1! qum,//1,e<, may he higher or /owff 1han esrimah·d 

PROPOSED COST FOR BASE PERIOD YEAR TWO (2) (IIJl7015 - 17/3117015) 

- ------ ---- -- (A) I (B) (C) 

Service Description Participant I Per Participant Proposed Annual 

Count/ Cost (Monthly) Cost 

Q~ntity 2015 (A*B)* 12 ---- ----------- -

Professional I,caming 

Accounts Administration 5900 2.23 I 57,884.00 ----

Modi fications/S pccial 

Services N/A NIA 13.000.00 - -

Quarterly Meeting 

Travel l',xpcnscs NIA NIA 6,000.00 - -- ------

Total Proposed Cost for 

Base Per_iQ_d __ Year Two (2) $ I 76,884.00 

f'ar/1c1pam qua1111/1cs uknti/ird nbovr' ar.- .-s11ma/e\, 1/,c appronJ.fned um/ pnc:es >Hf! b.- appl,a,hle regard/es.\ of the quw,lit,1· 

and acwal q,ia,11ines mm lw hrxher or Imrer than es1ima1cd 

CORHQ-13-B--Ootte 

PAGE 1l OF nz 
Page 14 

APPENDIX C (CONT) 

FDIC TllfRD PARTY ADMINISTRATOR SERVICES 

(PROFESSIONAL LEARNJJ;G ACCOUNTS PROGRAM) 

PROPOSED COST FOR HASE PLRTOD YEAR TI (REE (3) (l/1/2016 - I 1 /3 l no16) 

[ (A) 

CounU L'e .. rvice.· lkscription Participant 

I Quantit)_'._ __ i Professional Learning Accounts 

I (B) 

l Per Participant 

Cost (Monthly) 

2016 

i Administration 5900 2.27 

-------+--------,---- -

Modifications/S ccial Services Ni!\ 

Quarterly Meeting 

! Travel Expen0s_ecs _______ ~_cNc'1cA~ N/A 

Total Proposed Cost for Base 

(C) 

Proposed Annual 

Co1>t 

(A*B' * 12 

160,716.00 

13,000 00 

6,000.00 

179,716.00 

Period Y car '_('~rcc~(L3L) ~--~------ I'artic;pant quantities ident1(ted a bow arP ,-.vlimales. the approved.fixed uni/ prices will be applicahlc ref!_ardle.n of the quan/1/y 

and acma/ quanli!Jt's may ht higher or lower than estimated 

PROPOSED COSTS fOR fJRST OPTION YEAR /I /7017 - \?/31/2017) 

Service Description 

- -

Profes sional Learning Accounts 

Admin 

Modifi 

Quartc 

TraycJ 

Total 

0 tion 

istration ----- .. 

1cations/Snccial Services 

rly Meeting 

C_xp_e_125es 

Proposed Cost for First 

Year -----

----

(A) 

Participant 

Count/ 

Quantity 

5900 

N/A 

N/A 

-----

(B) Proposed Annual 

Per Participant Cost 

Cost (Moothly) (A*R) * 12 

2017 2017 

' 2.30 I 6?,840.00 -----

NIA 13,000.00 

'iii\ 6.000.00 

' 

s 181,840,011 ---- -

/ 

-

/'arficipw,t qummties identified abuw are ~sl,male.,. th,· approved.fixed um/ pnces will be applicr1blc ,·rgardkss o/lhP qliilnlity 

and aciua! quamilies ma_1· be hiRher m /0>1,'I" than estimared. 

CO~HQ-13-B-OCDll!l 

F'.!1,GC: 1~ OF t32 
Page 15 

APPENDIX C (CO'IT) 

FD!C THIRD PARTY ADMINISTRAJOR SERVICES 

(PROFESSJONAL LEARNl'IG ACCOUNTS PROGRAM) 

PROPOSED COST F_OR SFCONIJ OP f'JON YEAR (1/1/7018 12/11/2018) 

Service Description 

Profes~ional l,earning 

Accounts Administration 

Modi ficalions/Spccial 

Services 

Quanerly Meeting 

Travel Expenses 

Total Proposed Cost for 

__ Second Option Y car 

(A) 

Participant Count/ 

Quantity 

5900 

NIA 

N/A 

(B) -- --- ------ --

Proposed Annual Cost 

(A*H) * 12 

2018 

Per Participant 

Cost (Monthly) 

~~~--+------- 2018 -----

2.33 164.964.00 

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

NIA 13,000.00 

N/A 6.000.00 

$ 183,964.00 

Par1icipa11/ qutmlllies 1dn1tified ahove are eslimmes, the approwd_iixi,d um/ prices wilf he app/icr,b/c rt:'Js1rd/i'ss o_/the qurmlily 

and m:wal q,wnll/U'S may he higher or lower th{ln c,s1immPd. 

CORHQ-13-R-Onea 

PAGF 15 o;: 1l7 
CORHQ-B-C 0148 

Page 16 

BENEFIT ALLOCATION SYSTEMS, INC. 

AND SUBSIDIARIES 

CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 
CO RHO-1 3-C-0 148 

Page 17 

BENEF[T ALLOCATION SYSTEMS, !NC. AND SUBSIDIARIES 

King of Prussia, Pennsylvania 

CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

CONTENTS 

INDEPENDENT AUDITOR'S REPORT ... 

FINANCIAL STATEMENTS 

CONSOLIDATED BALANCE SHEETS .. 

CONSOLIDATED STATEMENTS OF OPERATIONS 

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY .. 

CONSOLIDATED STATEMENTS OF CASH FLOWS .................. . 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS .. 

CONSOLIDATING INFORMATION 

CONSOLIDATING BALANCE SHEET 

AS OF DECEMBER 31, 2012 ..... 

CONSOLIDATING BALANCE SHEET 

AS OF DECEMBER 31, 2011 ............... . 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2012 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2011 ..... 

3 

4 

5 

6 

7 

14 

15 

16 

17 

t'AGE 1"1 OF 1'.2 
CORHQ-13-C-0148 

PAGF 18 OF 132 

Page 18 

Crowe Horwath 

Crowe Horwath LLP 

lndep•odent Mutnbet ~"'"'" ~=ath lst•n,a,onal 

INDEPENDENT AUDrTOR'S REPORT 

Stockholders 

Benefit Allocation Systems, !nc. 

King of Prussia, Pennsylvania 

Report on the Financial Statements 

We have audited the accompanying consolidated financial statements of Benefit Allocation Systems, Inc., 

which comprise the consolidated balance sheets as of December 31, 2012 and 2011, and the related 

consolidated statements of operations, stockholders' equity, and cash flows for the years then ended, and 

the related notes to the financial statements. 

Management's Responsibility for the Financial Statements 

Management is responsible for the preparation and fair presentation of these consolidated financial 

statements in accordance with accounting principles generally accepted in the United States of America; 

this includes the design, implementation, and maintenance of internal control relevant to the preparation 

and fair presentation of consolidated financial statements that are free from material misstatement, 

whether due to fraud or error. 

Auditor's Responsibility 

Our responsibility is to express an opinion on these consolidated financial statements based on our 

audits. We conducted our audits in accordance with auditing standards generally accepted in the United 

States of America. Those standards require that we plan and perform the audit to obtain reasonable 

assurance about whether the consolidated financial statements are free from material misstatement. 

An audit involves perfonning procedures to obtain audit evidence about the amounts and disclosures in 

the consolidated financial statements. The procedures selected depend on the auditor's judgment, 

including the assessment of the risks of material misstatement of the consolidated financial statements, 

whether due to fraud or error. In making those risk assessments, the auditor considers internal control 

relevant to the entity's preparation and fair presentation of the consolidated financial statements in order 

to design audit procedures that are appropriate in the circumstances, but not for the purpose of 

expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no 

such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the 

reasonableness of significant accounting estimates made by management, as well as evaluating the 

overall presentation of the consolidated financial statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for 

our audit opinion. 

- Continued -
C:ORH0-13-C-0148 

Page 19 

Opinion 

In our opinion, the consolidated financial statements referred to above present fairly, in all material 

respects, the financial position of Benefit Allocation Systems, Inc. as of December 31, 2012 and 2011, 

and the results of their operations and their cash flows for the years then ended in accordance with 

accounting principles generally accepted in the United States of America. 

Other Matter 

Our audits were conducted for the purpose of forming an opinion on the consolidated financial statements 

as a whole. The consolidating balance sheets and statements of operations are presented for purposes of 

additional analysis of the consolidated financial statements rather than to present the financial position 

and results of operations of the individual companies, and is not a required part of the consolidated 

financial statements. Such information is the responsibility of management and was derived from and 

relates directly to the underlying accounting and other records used to prepare the consolidated financial 

statements. The consolidating information has been subjected to the auditing procedures applied in the 

audits of the consolidated financial statements and certain additional procedures, including comparing 

and reconciling such information directly to the underlying accounting and other records used to prepare 

the consolidated finandal statements or to the consolidated financial statements themselves, and other 

additional procedures in accordance with auditing standards generally accepted in the United States of 

America. In our opinion, the consolidating information is fair1y stated in al! material respects in relation to 

the consolidated financial statements as a whole. 

Indianapolis, Indiana 

February 28, 2013 

2. 

'.=AGE 1S or 132 

(b)(6) 
CORHQ-13-C-0148 

Page 20 

BENEFJT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED BALANCE SHEETS 

December 31, 

2012 

ASSETS 

Current assets 

Cash and cash equivalents $ 158,373 $ 

Accounts receivable 473,218 

Prepaid expenses 130,737 

Total current assets before funds held for clients 762,328 

Funds held for clients 3,902,998 

4,665,326 

Property and equipment, net 889,756 

Other assets 17,990 

$ 5,573,072 $ 

LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable $ 158,474 $ 

Deferred re\oenue 116,817 

Current portion of capitalized lease obligation 106,629 

Current portion of long-term debt 346,616 

Total current liabilities before client funds obligations 728,536 

Client funds obligations 3,900,511 

4,629,047 

Deferred rent expense 8,207 

Capita!lzed lease obligation, net of current portion 248,115 

Long-term debt, net of current portion 252,350 

5,137,719 

Commitments and contingencies (Notes 3, 4, 5, 6, and 7) 

Stockholders' Equity 435,353 

$ 5,573,072 $ 

See accompanying notes to consolidated financial statements 

PAGF 70 OF -,32 

2011 

251,186 

269,186 

112,940 

633,312 

4,012,308 

4,645,620 

806,840 

17,990 

5,470,450 

135,134 

96,988 

39,807 

376,332 

648,261 

4,002,435 

4,650,696 

31,875 

122,973 

258,350 

5,063,894 

406,556 

5,470,450 

3. 
CORHQ-13-C-0148 

Page 21 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF OPERATIONS 

Year ended December 31, 

2012 2011 

Revenue 

Fees $ 7,471,024 $ 7,351,674 

Expenses 

Payroll expense 5,415,214 5,113,340 

Selling general & administrati>ve expenses 543,971 507,684 

Depreciation and amortization 293,460 276,741 

Repairs and maintenance expense 245,612 308,288 

Professional fees 198,384 423,138 

Telephone expense 157,687 140,185 

Rent expense 137,760 140,360 

Adwrtising expense 106,562 118,094 

Insurance expense 97,987 71,864 

Auto expense 69,616 68,478 

Taxes 38,337 36,683 

Utilities 38,046 34,473 

Producer fees 35,971 64,573 

Bank sen.ice charges 703 828 

7,379,310 7,304,729 

Income from operations 91,714 48,945 

Other income (expense) 

Interest income 48 

Interest expense (47,313) (40,348) 

Net income $ 44,401 $ 6,647 

See accompanying notes to consolidated financial statements 

4. 

PAGC:2', C'IF t32 
CORHQ-13-C-0148 

Page 22 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY 

Years ended December 31, 2012 and 2011 

Common Stock 

Number Retained 

of shares Amount earnings 

Balance, January 1, 2011 14 $ 20,000 $ 461,064 

Stockholders' distribution (81,155) 

Net income, 

year ended December 31, 2011 6,647 

Balance at December 31, 2011 14 $ 20,000 $ 386,556 

Stockholders' distribution (15,604) 

Net income, 

year ended December 31, 2012 44,401 

Balance at December 31, 2012 14 $ 20,000 $ 415,353 

Stockholders' 

equity 

$ 481,064 

(81,155} 

6,647 

$ 406,556 

(15,604} 

44,401 

$ 435,353 

Common Stock, no par value; 1,000 shares authorized; 14 shares issued and outstanding, stated at $20,000 

See accompanying notes to consolidated financial statements 

5. 

PAGt 22 OF 13? 
CORHQ-13-C-0148 

Page 23 

BENEFIT ALLOCATION SYSTEMS, INC_ AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

Years ended December 31, 2012 and 2011 

Year ended December 31, 

2012 2011 

Cash flows from operating activities 

Net income $ 44,401 $ 6,647 

Adjustments to reconcile net income to 

net cash provided by operating activities 

Depreciation and amortization 293,460 276,741 

Changes in operating assets and liabilities 

Accounts receivable (204,032) 218,662 

Prepaid expenses (17,797) (56,102) 

Funds held for clients 109,310 (74,352) 

Accounts payable 23,340 30,452 

Deferred re-..enue 19,829 (4,460) 

Client fund obligations (101,924) 71,111 

Deferred rent (23,668) 945 

Net cash prO\.;ded by operating acti.,,;ties 142,919 469,644 

Cash flows used in investing activity 

Purchases of property and equipment (94,450) (225,235) 

Cash flows from financing activities 

Repayment of capitalized lease obligation (89,962) (34,237) 

Stockholders' distribution (15,604) (81,155) 

Proceeds from new borrowings 90,783 

Repayment of outstanding notes (35,716) (33,500) 

Net cash used in financing acti'Jities (141,282) (58,109) 

Net (decrease) increase in cash and cash equivalents (92,813) 186,300 

Cash and cash equivalents, beginning of year 251,186 64,886 

Cash and cash equivalents, end of year $ 158,373 $ 251,186 

Supplemental disclosure of cash flow information 

Interest paid $ 47,313 $ 40,346 

Taxes paid $ 19,442 $ 24,175 

Property and equipment purchased 

subject to capitalized lease obligations $ 281,926 $ 

See accompanying notes to consolidated financia! statements 

6. 

PAGE' 73 Of 13? 
C:JRHO-13-C-0148 

Page 24 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

Description of business 

Benefit Allocation Systems, Inc. (the "Company") is a company dedicated to the development and support 

of its proprietary MyEnroll.com web-based employee benefits administration tool for processing employee 

benefit plan enrollments, insurance premium and expense allocation billing, COBRA/HIPM notice 

processing and premium billing/collection/remittance, flexible spending account claims administration, 

health reimbursement account claims administration, and learning account expense administration. 

The Company provides MyEnroll.com a "Software-as-a-Service (SaaS)" that indudes administrative 

support services for its clients to off-load to the Company its administrative processing, electronic data 

interchanges with insurers and payroll, reporting, and call center services. Cobra Control Services, LLC 

("CCS") is a wholly owned subsidiary of the Company and provides COBRA compliance and 

administration services within the MyEnroU.com offering. 

The Company dedicates an important part of its resources to the ongoing development of MyEnroll.com 

applications and related support services to remain a leading solution for evolving insurance and human 

resource administration needs for existing and prospective clients. With a clear client-centered focus, the 

Company has reached a position as a provider of online insurance record keeping and billing services to 

businesses across most industries located throughout the United States. 

Consolidation and basis of preparation 

The consolidated financial statements include the financial results of Benefit Allocation Systems, Inc. and 

its two wholly-owned subsidiaries, one of which is inactive. lntercompany balances and transactions have 

been eliminated in consolidation. 

Use of estimates 

The preparation of financials statements in conformity with accounting principles generally accepted in 

the United States of America requires management to make estimates and assumptions that affect the 

reports amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of 

the consolidated financial statements and reported amounts of revenue and expenses during the 

reporting period. Accordingly, actual results could differ from those estimates. 

Cash and cash equivalents 

The Company considers all highly liquid investments with an original maturity of three months or less at 

the time of acquisition to be cash equivalents. 

Accounts receivable 

The Company assesses the collectability of their accounts receivable based primarily on the 

creditworthiness of the clients as determined by credit checks and analysis, as well as the client's 

payment history. As of December 31, 2012 and 2011 the Company has no allowance for doubtful 

accounts. 

Property and equipment 

Property and equipment are stated at cost and depreciated over the estimated useful lives of the assets 

using the straight-line method. Capital leases and leasehold improvements are depreciated or amortized 

over the shorter of the term of the lease or the estimated useful lives of the assets. 

- Continued -

7. 

P,l\GC ;!4 01132 
CORHQ-13-C-0148 

Page 25 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

The estimated useful lives of assets are primarily as follows: 

Office equipment & furniture 

Leasehold improvements 

Computer equipment 

Concentration of credit risk 

5 to 7 years 

10 years 

3 to 5 years 

Financial instruments which potentially subject the Company to concentrations of credit risk consist 

principally of cash and cash equivalents. The Company deposits cash and cash equivalents with high 

credit quality financial institutions and is insured to the maximum limitations. Balances in these accounts 

may exceed federally insured limits at times, which expose the Company to institutional rlsk. 

Revenue recognition 

The Company earns revenue from four sources that are fixed and their collectability reasonably assured: 

(1) Initial Service Year Setup Fees, (2) Renewal Years' Service Fees, (3) Client-employee Monthly 

Recurring Capitation Fees, and (4) Monthly Invoicing Fees. The Company issues its dients written price 

quotes and services agreements having stipulated terms and conditions that do not require management 

to make any significant judgments or assumptions regarding any potential uncertainties. 

The Company also earns revenue from one source that is a fixed percentage of premiums collected. This 

fee, as a percentage of COBRA premiums the Company collects from its dlents' COBRA Continuants 

(COBRA Continuants ongoing enrollment is unknown and may end earlier than the full length of their 

available coverage period), is set by Federal regulation. 

All fees charged by the Company are recognized as revenue at the time they are earned. Upfront 

advances from customers are recorded as deferred revenue until the time they are earned. 

Advertising costs 

Advertising costs are expensed as incurred. Advertising costs were $106,562 and $118,094 for the years 

ended December 31, 2012 and 2011 respectively. 

Impairment of long-lived assets 

Long-lived assets are reviewed for impairment whenever events or changes in circumstances lndlcate 

that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and 

used is measured by a comparison of the canying amount of an asset to estimated undiscounted future 

cash flows expected to be generated by the asset. If the canying amount of an asset exceeds its 

estimated future cash flows, an impairment charge is recognized for the amount by which the carrying 

amount of the asset exceeds the fair value of the asset. 

Internal use software 

Expenditures for major software purchases and software developed or obtained for Internal use are 

capitalized and amortized over a three-to-five-year period using the straight-line method. For software 

developed or obtained for internal use, the Company's policy provides for the capitalization of external 

direct costs of materials and services associated with developing or obtaining internal use computer 

software. 

- Continued -

8. 

Pt\c_;~ 25 OF 132 
COR.H0-13-C-0148 

Page 26 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

Costs associated with preliminary project stage activities, training, maintenance and all other postimplementation stage activities are expensed as incurred. The Company also expenses internal costs 

related to minor upgrades and enhancements, as it is impractical to separate these costs from normal 

maintenance activities. 

Income Taxes 

The Company has elecied to be treated as a Subchapter S Corporation for Federal and Pennsylvania 

income tax purposes. As such no provision or liability is made for federal and state income taxes since 

such obligations are the responsibility of the individual stockholders. 

The income tax returns of the Company are subject to examination by federal and state taxing authorities. 

Such examination could result in adjusbnents to net income or loss, which changes could affect the 

income tax liabilities of the individual stockholders. The Company's tax returns are open to examination 

for the three years ended December 31, 2012. 

NOTE 2 - PROPERTY AND EQUIPMENT 

Property and equipment, net, consists of the following: 

Computer equipment 

Capital lease equipment 

Office furniture 

Phone system 

Leasehold imprm.ements 

Exhibit booth 

Less: accumulated depreciation and amortization 

$ 

$ 

December 31, 

2012 2011 

833,088 $ 1,276,562 

473,390 199,036 

155,504 153,967 

139,241 95,575 

29,009 26,749 

7,195 7,195 

1,637,427 1,759,084 

(747,671) (952,244) 

889.756 $ 806,840 

Depreciation and amortization expense was $293,460 and $276,741 for the years ended December 31, 

2012 and 2011, respectively. 

NOTE J - FUNDS HELD FOR CLIENTS 

The Company collects funds from clients for payment of employee benefit services: temporarily holds 

such funds until payment is due and remits the funds to the clients' employees, insurance providers and 

others. 

- Continued -

9. 

PAGE: 26 OF '.32 
CORHQ-13-C-0148 

Page 27 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 3- FUNDS HELD FOR CLIENTS (Continued) 

Until April 2011, the Campany maintained a portion of its clients' funds in an overnight money market 

sweep account with a short-term maturity; the Campany had the right to receive the interest income from 

the client funds and the obligation to absorb the losses on client funds if any occurred. 

NOTE 4 - RELATED PARTY TRANSACTIONS 

The Company has an intercompany services agreement with Taylor & Ochroch Inc. ("T&O"), an entity 

owned by one of the Company's stock.holders. 

Far the year ended December 31, 2011, T&O acted as the common paymaster for both companies for 

which BAS reimbursed T&O for all payroll expenses for those employees used in BAS related business 

activities. Under the agreement, BAS and T&O split all general and administrative and rent expenses 

proportionately based an monthly usage. Beginning January 1, 2012, the Company became the common 

paymaster for both companies. T&D reimburses the Company for all payroll expenses for those 

employees used in T&O related business activities. The Company reimburses T&O for employee cars 

and related insurance expenses incurred relating to the Company's business activities. ln addition, T&O 

is also responsible for all costs related to leasehold improvements. T&O also reimburses the Company a 

discretionary amount per active participant for its use of the Company's MyEnroll system. For the years 

ended December 31, 2012 and 2011 T&O reimbursed the Company $421,763 and $443,557, 

respectively for use of the Company's MyEnroll system. Any extraordinary expense reimbursements are 

determined as they occur. 

For the years ended December 31, 2012 and 2011 the Company did not have any outstanding payments 

due to T&O. 

On November 1, 2003 the Company entered into a lease agreement for office space with Yaungsford 

Associates, a related party. The lease is month to month with no expiration date. Rent expense charged 

ta operations, including escalation charges for real estate taxes and other expenses, amounted to 

$50,400 and $49,800 for the years ended December 31, 2012 and 2011 respectively. 

NOTE 5-DEBT 

The Company's notes payable and other debt consists of the following: 

Notes payable - stockholders 

People's Bank re\Oh.ing loan 

Less: current portion 

Debt, net of current portion 

$ 

$ 

- Continued -

December 31, 

2012 2011 

252,350 $ 258,350 

346,616 376,332 

598,966 634,682 

(346,616) (376,332) 

252,350 $ 258,350 

10. 

PAGE 27 0113L 
CORHQ-13-C-0148 

Page 28 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 5 - DEBT (Continued) 

Notes payable - stockholders 

On December 20, 1996 the Company secured a promissory note from its founder and president, in the 

amount of $9,000. The note bears interest at 7% per annum and has no due date. As of December 31, 

2012 and 2011 the note had an outstanding balance of $9,850 and $9,850, respedively. The note is 

secured by the assets of the Company. The stockholder has indicated that he will not demand repayment 

within the year; therefore the note has been classified as long-term. 

On December 13, 2001, the Company secured a promissory note from a stockholder, in the amount of 

$300,000. The note bears interest at 5% per annum and does not have a due date. As of December 31, 

2012 and 2011 the note had an outstanding balance of $242,500 and $248,500, respectively. The note is 

secured by the assets of the Company. The stockholder has indicated that he will not demand repayment 

within the year: therefore the note has been classified as long-term. 

People's Bank revolving loan 

On October 25, 2010 the Company entered into a revolving loan agreement with People's Bank for 

$500,000. Interest is charged at 3.3% per annum and is payable monthly. The loan is due in full 

immediately upon the lender's demand. As of December 31, 2012 and 2011 the note had an outstanding 

balance of $346,616 and $376,332, respectively. 

NOTE 6 - PENSION PLAN 

The Company has established a defined contribution 401(k) Plan (the "401(k) Plan"). Prior to 2012, the 

401(k) Plan was sponsored by T&O. Employee contributions to the 401(k) Plan are made through pre-tax 

payroll reductions. Employees of the Company who are age 21 or older and have completed 6 months of 

eligibility service (or 1000 hours of service in a year) are eligible to participant in the 401(k) Plan. 

Participants may contribute a dollar amount or percentage of compensation to the Plan, up to the dollar 

limit allowed under the Internal Revenue Code. The Company has historically made a discretionary 

matching contribution to the 401(k) Plan equal to 100% of the first 2.5% of employee contributions made 

to the Plan. For the years ended December 31, 2011 and 2012, the Company has recorded discretionary 

matching contributions of $52,584 and $63,319, respectively. 

NOTE 7 - COMMITMENTS AND CONTINGENCIES 

Capitalized leases 

On April 15, 2010, the Company entered into a lease agreement for a telephone system. The lease is for 

60 months with payments of $3,578 per month. The Company has the option to purchase the telephone 

system at the end of the lease for $1; as such the lease has been accounted for as a capital lease. The 

gross amount of the capitalized leased telephone system induded in fixed assets was $199,036, 

Accumulated amortization on the telephone lease as of December 31, 2012 and 2011 was $104,494 and 

$64,687, respectively. 

On May 22, 2012, the Company entered into a lease agreement for a computer server. The lease is for 

48 months with payments of $6,441 per month. The term of the lease exceeds 75% of the server's useful 

life; as such the lease has been accounted for as a capital lease. The amount of the capitalized leased 

server included in fixed assets as of December 31, 2012 was $281,926. The amount of accumulated 

amortization related to the server was $32,904 as of December 31, 2012. 

- Continued -

11. 

PAGE 28 OF 132 
CORIIQ•13-C-0148 

Page 29 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 7 - COMMITMENTS AND CONTINGENCIES (Continued) 

Required minimum lease payments, including interest, on the capitalized leases are as follows: 

Year ending December 31, 

2013 

2014 

2015 

2016 and thereafter 

Less: amount representing interest at 

weighted average effecti--.e rate of 4.5% 

Present -value of minimum lease payments 

$ 

$ 

120,225 

120,225 

113,070 

27,435 

380,955 

(26,211) 

354,744 

Total capital leases included as fixed assets for years ended December 31, 2012 and 2011, were 

$473,390 and $199,036, respectively. Total accumulated amortization on the capital leases were $64,687 

and $137,398, respectively. Amortization expense related to the capitalized leases for the years ended 

December 31, 2012 and 2011 was $72,711 and $39,807, respectively. 

Office lease 

On March 4, 2010, the Company entered into a three year lease for office space consisting of 5,681 

square feet in King of Prussia, Pennsylvania with a lease commencement date of May 1, 2010. The lease 

expires April 30, 2013. As of the date on which the consolidated financial statements were available to be 

issued, the Company has not renewed the lease or entered into a new lease agreement. 

The aggregate minimum future payments under the office lease as of December 31, 2012 are as follows: 

Year ending December 31, 

2013 $ 36,927 

2014 and thereafter 

$ 36,927 

Rent expense related to the office space charged to operations was $86,162 and $86,162 for the years 

ended December 31, 2012 and 2011, respectively. 

Concentrations 

During the years ended December 31, 2012 and 2011 the Company had one client who represented 27% 

and 27% of total revenue, respectively. 

During the years ended December 31, 2012 and 2011 the Company had one client who represented 31 % 

and 32% of accounts receivable, respectively. 

- Continued -

12. 

PAGE 29 OF 132 
CORHQ-13-C-0148 

Page 30 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2012 and 2011 

NOTE 8 - SUBSEQUENT EVENTS 

The Company has evaluated subsequent events through February 28, 2013, the date on which the 

consolidated financial statements were available to be issued. The Company has detennined that there 

are no material subsequent events that would require disclosure in the financial statements through this 

date. 

13. 

PAGE 30 OF 132 
Page 31 

CONSOLIDATING INFORMATION 

CORHQ-13-C-0148 
PAGF 3,' OF 132 

Page 32 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING BALANCE SHEET 

DECEMBER 31, 2012 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations Consolidated 

ASSETS 

CurTent assets 

Cash and cash equivalents ' 138,293 ' 20,080 ' ' 158,373 

ln-.estment in subsidiary 29,184 (29,184) 

Accounts recei1,0ble 387,129 86,089 473,218 

Prepaid expenses 130.737 130.737 

Total current assets before 

funds held for clients 685,343 106,169 (29, 184-) 762,328 

Funds held for clients 2,249,847 1,653,151 3,902,998 

2,935,190 1,759,320 (29,184) 4,665,326 

Property and equipment, net 889.756 889,756 

Other assets 17,990 17,990 

' 3,842,936 ' 1,759.320 ' (2R 184-J ' 5,573,072 

LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable ' 158,474 ' ' ' 158,474 

Deferred re\E!nue 96,784 20,033 116,817 

Current portion of capitalized 

lease obligatlon 106,629 106,629 

Current portion of long-term debt 346,616 346,616 

Tota\ current liabilities before 

client funds obligations 708,503 20,033 na,536 

Client funds obligations 2,247,360 1,653,151 3,900,511 

2,955,863 1,673,184 4,629,047 

Deferred rent expense 8,207 8,207 

capitalized lease obligation, 

net of current portion 248,115 248,115 

Long-term debt, net of current portion 252,350 252,350 

3,464,535 1,673,184 5,137,719 

Stockholders' Equity 378.401 86.136 (29,184) 435,353 

' 3,842,936 ' 1,759,320 ' (29,184) ' 5,573,072 

See accompanying notes to consolidated financial statements 

14. 

CORHQ-13-C·0148 
PAGE 33 OF 132 

Page 33 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING BALANCE SHEET 

DECEMBER 31, 2011 

Benefit 

AllocaUon Cobra Control 

Systems, Inc. Systems, Inc_ Eliminations Consolidated 

ASSETS 

Current assets 

Cash and cash equivalents $ 213,108 $ 38,078 $ $ 251,166 

lmestment in subsidiary 29,1S4 (29,184) 

Accounts receilable 192,258 76,928 269.186 

Prepaid expenses 112,940 112,940 

Total current assets before 

funds held for clients 547,490 115,006 (29,184) 633,312 

Funds held for clients 2,402,347 1,609,961 4,012,308 

2,$49,837 1,724,967 (29,184) 4,645,620 

Property and equipment, net 806,840 806,840 

Other assets 17,990 17,990 

$ 3,774,667 $ 1,724,967 $ (29,184) $ 5,470,450 

LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable $ 135,134 $ $ $ 135,134 

Deferred le\8nue 92,756 4,232 96,988 

Current portion of capitalized 

lease oOligalion 39,807 39,807 

Current portion of long-term debt 376,332 376,332 

Total current liabilities before 

client funds obligations 644,029 4,232 648,261 

Client funds obligations 2,392,474 1,609,961 4,002,435 

3,036,503 1,614,193 4,650,696 

Deferred rent expense 31,875 31,875 

Capitalized lease obligation, 

net of current portion 122,973 122,973 

Long-term debt, net of current portion 258,350 258,350 

3,449,701 1,614,193 5,063,894 

Stockholders' Equity 324,966 110,774 {29,184) 406,556 

$ 3,774,667 $ 1,724,967 ' (29,184) $ 5,470,450 

See accompanying notes to consolidated financial statements 

15. 

CORHQ-13-C-0 148 
COR.HQ-13-C-0148 

Page 34 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2012 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminatioos 

Revenue 

fee, ' 6,325.567 $ 1,145,457 ' 

Expenses 

Payroll expense 5,415,214 409,924 (409,924) 

CCS expense (1,051,372) 1,051,372 

Selling general & administrati-.e expenses 543,103 642,316 (641,448) 

Depreciation and amortization 2'3,460 

Repair.; and maintenance expense 245,612 

Professional fees 191.095 7,289 

Telephone expense 157,687 

Rent expense 137,760 

Ad10rtising expense 106,562 

Insurance expense 97,987 

Auto expense 69,616 

T~~ 38,337 

Utilities 38,046 

Producer fees 35,971 

Bank ser..ice charges 703 

6.319,781 1,059,529 

Income from operations 5,786 85,928 

Other income (expense) 

Interest income 

Interest expense (47,313) 

Net income ' (41,527) ' 85,928 ' 

See accompanying notes to consolidated financial statements 

PAGE 34 OF 132 

Consolidated 

' 7.471,024 

5.415,214 

543,971 

293,460 

245.612 

196,3B4 

157,667 

137,760 

106,562 

97,987 

69,616 

38,337 

38,046 

35,971 

703 

7,379,310 

91,714 

(47,313) 

' 44,401 

16. 
COR!i0-13-C-0148 

Page 35 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2011 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations 

Revenue 

F~s $ 6,191,917 $ 1,159,757 $ 

Expenses 

Payroll expense 5,113,340 314.494 (314,494) 

CCS expense (1,011,592) 1,011,592 

Selling general & administratr.e expenses 507,684 697,098 (697,098) 

Professlonal fees 403,212 19,926 

Repairs and maintenance expense 308.288 

Depreciation and amortization 276.741 

Rent expense 140,360 

Telephone expense 140,185 

Ac11,0rtising expense 118,094 

Insurance expense 71,864 

Auto expense 68,478 

Producer fees 64,573 

T~~ 36.683 

utilities 34,473 

Bank seNce charges 828 

6,273.211 1,031,518 

(Loss) income from operations (81,294) 128,239 

Other income (expense) 

Interest income 48 

Interest expense (40,346) 

Net (loss) income $ (121,640) $ 128,287 $ 

See accompanying notes to consolidated financial statements 

PAGE 35 OF 132 

Consolidated 

$ 7,351,674 

5,113,340 

507,684 

423,138 

308,288 

276,741 

140,360 

140,185 

118,094 

71,664 

68,478 

64,573 

36,683 

34,473 

828 

7,304.729 

46,945 

48 

(40,346) 

$ 6,647 

17. 
CORHQ-13-C-0148 

Page 36 

BENEFIT ALLOCATION SYSTEMS, INC. 

AND SUBSIDIARIES 

CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

PAGC: 36 OF 132 
CORHQ 13 C-0148 

Page 37 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

King of Prussia, Pennsylvania 

CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 201 0 

CONTENTS 

REPORT OF INDEPENDENT AUDITORS .. 

FINANCIAL STATEMENTS 

CONSOLIDATED BALANCE SHEETS .......... . 

CONSOLIDATED STATEMENTS OF OPERATIONS 

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY ............ . 

1 

2 

3 

4 

CONSOLIDATED STATEMENTS OF CASH FLOWS....................................................................... 5 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ........ . 

CONSOLIDATING INFORMATION 

CONSOLIDATING BALANCE SHEET 

AS OF DECEMBER 31, 2011 

CONSOLIDATING BALANCE SHEET 

AS OF DECEMBER 31, 2010 .... 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2011 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2010 

6 

13 

14 

15 

16 

PAGE 37 0~ 132 
CO~HQ-13-C-0148 

PAGE 38 OF 132 

Page 38 

A Crowe Horwath. Crowe Horwath U.P 

Independent M e<rt>er Crowe Ho,,....lh International 

Stockholders 

Benefrt Allocation Systems, Inc. 

King of Prussia, Pennsylvania 

REPORT OF INDEPENDENT AU_DITORS 

We have audited the accompanying consolidated balance sheets of Benefit Allocation Systems, Inc. (the 

·company") as of December 31, 2011 and 2010, and the related consolidated statements of operations, 

stockholders' equity and cash flows for the years then ended. These financial statements are the 

responsibility of the Company's management. Our responsibility is to express an opinion on these 

financial statements based on our audits. 

We conducted our audits in accordance with auditing standards generally accepted in the United States 

of America. Those standards require that we plan and perform the audit to obtain reasonable assurance 

about whether the financial statements are free of material misstatement. An audit includes examining, on 

a test basis, evidence supporting the amounts and disclosures In the financial statements. An audit also 

includes assessing the accounting principles used and significant estimates made by management, as 

well as evaluating the overall financial statement presentation. We believe that our audits provide a 

reasonable basis for our opinion. 

In our opinion, the consolidated financial statements referred to above present fairly, in all material 

respects, the financial position of Benefit Allocation Systems, Inc. as of December 31 , 2011 and 2010, 

and the results of Its operations and its cash flows for the years then ended in conformity with accounting 

principles generally accepted in the United States of America. 

Our audits were conducted for the purpose of forming an opinion on the consolidated financial statements 

as a whole. The consolidating information is presented for purposes of additional analysis of the 

consolidated financial statements rather than to present the financial position, results of operations, and 

cash flows of the individual companies, and is not a required part of the consolidated financial statements. 

Such information is the responsibility of management and was derived from and relates directly to the 

underlying accounting and other records used to prepare the consoUdated financial statements. The 

consolidating lnfonnation has been subjected to the auditing procedures applied in the audits of the 

consolidated financial statements and certain additional procedures, including comparing and reconciling 

other information directly to the underlying accounting and such records used to prepare the consolidated 

financial statements or to the consolidated financial statements themselves, and other additional 

procedures in accordance with auditing standards generally accepted ln the United States of America. In 

our opinion, the consolidating information is fairly stated in all material respects in relation to the 

consolidated financial statements as a whole. 

New York, New York 

April 6, 2012 

Crowe Horwath LLP 

1. 

(b )(6) 
CORHQ-13-C-0148 

Page 39 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED BALANCE SHEETS 

December 31, 

2011 

ASSETS 

Current assets 

Cash and cash equivalents $ 251,186 $ 

Accounts receivable 269,186 

Prepaid expenses 112,940 

Total current assets before funds held for clients 633,312 

Funds held for clients 4,012,308 

4,645,620 

Property and equipment, net 806,840 

Other assets 17,990 

$ 5,470,450 $ 

LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable $ 135,134 $ 

Deferred re.enue 96,988 

Current portion of capitalized lease obligation 39,807 

Current portion of long-term debt 376,332 

Tota\ current liabilities before client funds obligations 648,261 

Client funds obligations 4,002,435 

4,650,696 

Deferred rent expense 31,875 

Capitalized lease obligation, net of current portion 122,973 

Long-term debt, net of current portion 258,350 

5,063,894 

Commitments and contingencies 

(Notes 3, 4, 5, 6, and 7) 

Stockholders' Equity 406,556 

$ 5,470,450 $ 

See accompanying notes to consolidated financial statements 

PAG[ 39 or 132 

2010 

64,886 

487,848 

56,838 

609,572 

3,937,956 

4,547,528 

858,346 

17,990 

5,423,864 

1D4,682 

101,448 

39,807 

315,549 

561,486 

3,931,324 

4,492,810 

30,930 

157,210 

261,850 

4,942,800 

481,064 

5,423,864 

2. 
CORHO-13-C-0148 

Page 40 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF OPERATIONS 

Year ended December 31, 

2011 2010 

Revenue 

Fees $ 7,351,674 $ 6,414,680 

Expenses 

Payroll expense 5,113,340 3,953,445 

Selling general & administrati-..e expenses 507,684 520,884 

Professional fees 423,138 486,823 

Repairs and maintenance expense 308,288 155,715 

Depreciation and amortization 276,741 285,345 

Rent expense 140,360 92,629 

Telephone expense 140,185 146,614 

Ad-..ertising expense 118,094 76,921 

Insurance expense 71,864 49,725 

Auto expense 68,478 77,302 

Producer fees 64,573 78,765 

Taxes 36,683 12,489 

Utilities 34,473 34,582 

Bank ser\.ice charges 828 1,105 

7,304,729 5,972,344 

Income from operations 46,945 442,336 

Other income (expense) 

Interest income 48 128 

Interest expense (40,346) (35,376) 

Net income $ 6,647 $ 407,088 

See accompanying notes to consolidated financial statements 

3. 

PAGE 40 OF 132 
CORH0-13-C-0148 

Page 41 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY 

Years ended December 31, 2011 and 2010 

Balance, January 1, 2010 

Stockholders' distribution 

Net income, 

year ended December 31, 2010 

Balance at December 31, 2010 

Stockholders' distribution 

Net income, 

year ended December 31, 2011 

Balance at December 31, 2011 

Common Stock, no par value; 

1,000 shares authorized; 

Common Stock 

Number of 

shares Amount 

14 $ 20,000 

14 $ 20,000 

14 $ 20,000 

14 shares issued and outstanding, stated at $20,000 

Retained 

earnings 

$ 72,243 

(18,267) 

407,088 

$ 461,064 

(81,155) 

6,647 

$ 386,556 

See accompanying notes to consolidated financial statements 

PAGE ~1 OF 132 

Stockholders' 

equity 

$ 92,243 

(18,267) 

407,088 

$ 481,064 

(81,155) 

6,647 

$ 406,556 

4. 
CORH0-13-C-0148 

Page 42 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATED STATEMENTS OF CASH FLOWS 

Years ended December 31, 2011 and 2010 

Year ended December 31, 

2011 2010 

INCREASE (DECREASE) IN CASH 

AND CASH EQUIVALENTS 

Cash flows from operating activities 

Net income $ 6,647 $ 407,088 

Adjustments to reconcile net Income to 

net cash provided by operating activities 

Depreciation and amortization 276,741 285,345 

Changes in operating assets and liabilities 

Accounts receivable 218,662 (262,576) 

Prepaid expenses (56,102) (46,991) 

Funds held for clients (74,352) (1,625,386) 

Other assets (17,990) 

Accounts payable 30,452 32,399 

Deferred re..enue (4,460) 20,669 

Client fund obligations 71,111 1,622,386 

Deferred rent 945 30,930 

Net cash provided by operating acti\nties 469,644 445,874 

Cash flows used in investing activity 

Purchases of property and equipment (225,235) (528,538) 

Cash flows from financing activities 

Repayment of capitalized lease obligation (34,237) (2,019) 

Stockholders' distribution (81,155) (18,267) 

Proceeds from new borrowings 90,783 315,549 

Repayment of outstanding notes (33,500) (302,791) 

Net cash used in financing acti\nties (58,109) (7,528) 

Net increase (decrease) in cash and cash equivalents 186,300 (90,192) 

Cash and cash equivalen~ beginning of year 64,886 155,078 

Cash and cash equivalen~ end of year $ 251,186 $ 64,886 

Supplemental disclosure of cash flow information 

Interest paid $ 40,346 $ 35,376 

Taxes paid $ 24,175 $ 12,489 

Property and equipment purchased 

subject to capitalized lease obligations $ $ 199,036 

See accompanying noles to consolidated financial statements 

5. 

PAGf 42 OF 132 
CORHQ-13-C-0148 

Page 43 

BENEFIT ALLOCATION SYSTEMS, INC. ANO SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

Description of business 

Benefit Allocation Systems, Inc., rsAS") is a company dedicated to the development and support of its 

proprietary MyEnroll.com web-based employee benefits administration too! for processing benefit plan 

enrollment; COBRA/HIPAA compliance: and Flexible Spending Account (FSA), Health Reimbursement 

Account (HRA) and Professional Learning Account administration. 

BAS provides MyEnroll.com a "Software-as-a-Service (Saasr that includes administrative support 

services for its clients to off-load to BAS its administrative processing, electronic data interchanges with 

insurers and payroll, reporting, and call center services. Cobra Control Services, LLC {"CCSD) is a wholly 

owned subsidiary of BAS and provides COBRA compliance and administration services within the 

MyEnroll.com offering. 

BAS dedicates an important part of its resources to the ongoing development of MyEnrol!.com 

applications and related support services to remain a leading solution for evolving insurance and human 

resource administration needs for existing and prospective clients. With a clear client-centered focus, 

BAS has reached a position as a provider of online insurance record keeping and billing services to 

businesses across most industries located throughout the United States. 

Consolidation and basis of preparation 

The consolidated financial statements include the financial results of Benefit Allocation Systems, Inc. and 

its two wholly-owned subsidiaries, one of which is inactive (the "Company"). lntercompany balances and 

transactions have been eliminated in consolidation. 

Use of estimates 

The preparation of financials statements in conformity with accounting principles generally accepted in 

the United Stales of America requires management to make estimates and assumptions that affect the 

reports amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of 

the consolidated financial statements and reported amounts of revenue and expenses during the 

reporting period. Accordingly, actual results could differ from those estimates. 

Cash and cash equivalents 

The Company considers all highly liquid investments with an original maturity of three months or less at 

the time of acquisition to be cash equivalents. 

Accounts receivable 

The Company assesses the cotlectability of their accounts receivable based primarily on the 

creditworthiness of the clients as determined by credit checks and analysis, as well as the client's 

payment history. As of December 31, 2011 and 2010 the Company has no allowance for doubtful 

accounts. 

- Continued -

6. 

PAGE43OF132 
CORHQ-13"C-0148 

Page 44 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

Property and equipment 

Property and equipment are stated at cost and depreciated over the estimated useful lives of the assets 

using the straight-line method. Capital leases and leasehold improvements are depreciated or amortized 

over the shorter of the term of the lease or the estimated useful lives of the assets. The estimated useful 

lives of assets are primarily as follows: 

Office equipment & furniture 

Leasehold improvements 

Computer equipment 

Concentration of credit risk 

5 to 7 years 

10 years 

3 to 5 years 

Financial instruments which potentially subject the Company to concentrations of credit risk consist 

principally of cash and cash equivalents. The Company deposits cash and cash equivalents with high 

credit quality financial institutions and is insured to the maximum limitations. Balances in these accounts 

may exceed federally insured limits at times, which expose the Company to institutional risk. 

Revenue recognition 

The Company earns revenue from three sources that are fixed and their collectability reasonably assured: 

(1) Initial Service Year Setup Fees, (2) Renewal Years' Service Fees, and (3) Client-employee Monthly 

Recurring Capitation Fees. The Company issues its clients written price quotes and services agreements 

having stipulated terms and conditions that do not require management to make any significant 

judgments or assumptions regarding any potential uncertainties. 

The Company also earns revenue from one source that is a fixed percentage of premiums collected. This 

fee, as a percentage of COBRA premiums the Company coltects from its clients' COBRA Continuants 

(COBRA Continuants ongoing enrollment is unknown and may end earlier than the full length of their 

available coverage period), is set by Federal regulation. 

All fees charged by the Company are recognized as revenue at the time they are earned. 

Advertising costs 

Advertising costs are expensed as incurred. Advertising costs were $118,094 and $76,921 for the years 

ended December 31, 2011 and 2010 respectively. 

Impairment of long-lived assets 

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate 

that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and 

used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future 

cash flows expected to be generated by the asset. \f the carrying amount of an asset exceeds its 

estimated future cash flows, an impairment charge is recognized for the amount by which the carrying 

amount of the asset exceeds the fair value of the asset. 

- Continued -

7. 

?AGE 44 OF 132 
CORHQ-13-C-0148 

Page 45 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 

Internal use software 

Expenditures for major software purchases and software developed or obtained for internal use are 

capitalized and amortized over a three-to five-year period using the straight-line method. For software 

developed or obtained for internal use, the Company's policy provides for the capitalization of external 

direct costs of materials and services associated with developing or obtaining internal use computer 

software. In addition, the Company capitalizes certain payroll and payroll-related costs for employees who 

are directly associated with internal use computer software projects. The amount of capitalizable payroll 

costs with respect to these employees is limited to the time directly spent on such projects. Costs 

associated with preliminary project stage activities, training, maintenance and all other postimplementation stage activities are expensed as incurred. The Company also expenses internal costs 

related to minor upgrades and enhancements, as it is impractical to separate these costs from normal 

maintenance activities. 

Income Taxes 

The Company has elected to be treated as a Subchapter S Corporation for Federal and Pennsylvania 

income tax purposes. As such no provision or liability is made for federal and state income taxes since 

such obligations are the responsibility of the individual stockholders. 

A tax position is recognized as a benefit only if it is "more likely than not• that the tax position would be 

sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized 

is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For 

tax positions not meeting the "more likely than not" test, no tax benefit is recorded. 

The income tax returns of the Company are subject to examination by federal and state taxing authorities. 

Such examination could result in adjustments to net income or loss, which changes could affect the 

income tax liabilities of the individual stockholders, The Company's tax returns are open to examination 

for the three years ended December 31, 2010. 

NOTE 2 - PROPERTY AND EQUIPMENT 

Property and equipment, net, consists of the following: 

Phone system 

Exhibit booth 

Computer equipment 

Office furniture 

Leasehold impro-.ements 

Capital lease equipment 

Less: accumulated depreciation and amortization 

- Continued -

$ 

$ 

December 31, 

2011 2010 

95,575 $ 87,972 

7,195 7,195 

1,276,562 1,317,185 

153,967 87,700 

26,749 26,749 

199,036 199,036 

1,759,084 1,725,837 

(952,244) (867,491) 

806,840 $ 858,346 

8. 

PAGE 45 OF 132 
CORHQ-13-C-0148 

Page 46 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 2- PROPERTY AND EQUIPMENT (Continued) 

Depreciation and amortization expense was $276,741 and $285,345 for the years ended December 31, 

2011 and 2010 respectively. 

NOTE 3 - FUNDS HELD FOR CLIENTS 

The Company collects funds from clients for payment of employee benefit services; temporarily holds 

such funds until payment is due and remits the funds to the clients' employees, insurance providers and 

others. 

Until April 2011, the Company maintained a portion of its clients' funds in an overnight money market 

sweep account with a short-term maturity; the Company had the right to receive the interest income from 

the client funds and the obligation to absorb the losses on client funds if any occurred. 

NOTE 4 - RELATED PARTY TRANSACTIONS 

The Company has an intercompany services agreement with Taylor & Ochroch Inc. ("T&O"), an entity 

owned by one of the Company's stockholders. T&O and the Company share office space and expenses 

related to the office space, In addition, T&O acts as the common paymaster for both companies for which 

BAS reimburses T&O for all payroll expenses for those employees used in BAS related business 

activities. Under the agreement, BAS and T&O split all general and administrative and rent expenses 

proportionately based on monthly usage. Any extraordinary expense reimbursements are determined as 

they occur. 

For the years ended December 31, 2011 and 2010 the Company did not have any outstanding payments 

due to T&O. 

On November 1, 2003 the Company entered into a lease agreement for office space with Youngsford 

Associates, a related party. The lease is month to month with no expiration date. Rent expense charged 

to operations, including escalation charges for real estate taxes and other expenses, amounted to 

$49,800 and $35,188 for the years ended December 31, 2011 and 2010 respectively. 

NOTE 5-DEBT 

The Company's notes payable and other debt consists of the following: 

Notes payable - stockholders 

People's Bank revolving loan 

Less: current portion 

Debt, net of current portion 

$ 

$ 

- Continued -

December 31, 

2011 2010 

258,350 $ 261,850 

376,332 315,549 

634,682 577,399 

(376,332) (315,549) 

258,350 $ 261,850 

9. 

PAGE 46 OF 132 
COR.HO-13-C-0148 

Page 47 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLJDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 5 - DEBT (Continued) 

Notes payable - stockholders 

On December 20, 1996 the Company secured a promissory note from its founder and president, in the 

amount of $9,000. The note bears interest at 7% per annum and has no due date. As of December 31, 

2011 and 2010 the note had an outstanding balance of $9,850. The stockholder has indicated that he will 

not demand repayment within the year; therefore the note has been classified as long-term. 

On December 13, 2001, the Company secured a promissory note from a stockholder, in the amount of 

$300,000. The note bears Interest at 5% per annum and does not have a due date. As of December 31, 

2011 and 2010 the note had an outstanding balance of $248,500 and $252,000, respectively. The note ls 

secured by the assets of the Company. The stockholder has indicated that he will not demand repayment 

within the year; therefore the note has been classified as long-term. 

People's Bank revolving loan 

On October 25, 2010 the Company entered into a revolving loan agreement with People's Bank for 

$500,000. Interest is charged at 3.3% per annum and is payable monthly. The loan is due in full 

immediately upon the lender's demand. As of December 31, 2011 and 2010 the note had an outstanding 

balance of $376,332 and $315,549, respectively. 

NOTE 6 - PENSION PLAN 

T&O has established a defined contribution 401{k) plan ("the 401 (k) Plan"). The contributions are included 

in payroll expense reimbursements. Substantially all of the employees of the Company are eligible to 

participate in the 401{k) Plan which permits the employees to make voluntary contributions up to a 

maximum of 15% of their annual compensation to the dollar limit allowed under the Internal Revenue 

Code. The 401 (k) Plan also provides for a discretionary matching contribution of 2.5% of an employee's 

annual compensation. Under the terms of the expense sharing agreement T&O makes the contributions 

which are reimbursed by the Company for its portion. This discretionary matching contribution is available 

only to non-highly compensated eligible employees as defined by the Internal Revenue Code. For the 

years ended December 31, 2011 and 2010 the Company has recorded discretionary matching 

contributions of $63,319 and $36,250 respectively. 

NOTE 7 - COMMITMENTS AND CONTINGENCIES 

Capitalized lease 

On April 15, 2010, the Company entered into a lease agreement for a telephone system. The lease is for 

60 months with payments of $3,719 per month. The Company has the option to purchase the telephone 

system at the end of the lease for $1; as such the lease has been accounted for as a capital lease. The 

amount of the capitalized leased telephone system included in fixed assets as of December 31, 2011 is 

$199,036. 

- Continued -

10. 

PAGF 47 OF ;32 
CORHQ-13-C-0148 

Page 48 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31 , 2011 and 201 o 

NOTE 7 - COMMITMENTS AND CONTINGENCIES (Continued) 

Required minimum lease payments, including interest, on the capitalized lease are as follows: 

Year ending December 31, 

2012 $ 44,631 

2013 44,631 

2014 44,631 

2015 44,631 

178,524 

Less: amount representing interest at 

weighted a-.erage effecti-..e rate of 4.6% (15,744) 

Present value of minimum lease payments $ 162,780 

Amortization expense related to the capitalized lease for the years ended December 31, 2011 and 2010 

was $39,807 and $24,880, respectively. 

Office lease 

On March 4, 2010, the Company entered into a three year lease for office space consisting of 5,681 

square feet in King of Prussia, Pennsylvania with a lease commencement date of May 1, 2010. 

The aggregate minimum future payments under the office lease as of December 31, 2010 are as follows: 

Year ending December 311 

2012 

2013 

2014 and thereafter 

$ 109,833 

36,927 

$ 146,759 

Rent expense related to the office space charged to operations was $86,162 and $57,441 for the years 

ended December 31, 2011 and 2010, respectively. 

Automobile leases 

The Company is obligated under three, three-year non-cancelable operating leases for automobiles 

expiring on various dates from 2011 to 2012. Under the terms of these agreements, the Company is 

obligated to make fixed monthly payments. The agreements included an excessive use clause wherein 

the Company may be charged a fee for wear that is deemed above normal. Each lease provides for a 

purchase option at the end of the lease term. 

Future minimum payments under these leases are as follows: 

Year ending December 31, 

2012 $ 17,514 

- Continued -

11 . 

PAGE 48 OF 132 
CORHQ-13-C-0148 

Page 49 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 

Years ended December 31, 2011 and 2010 

NOTE 7 - COMMITMENTS AND CONTINGENCIES (Continued) 

Rent expense related to the automobile leases and charged to operations amounted to approximately 

$22,653 and $23,182 for the years ended December 31, 2011 and 2010 respectively. 

Concentrations 

During the years ended December 31, 2011 and 2010 the Company had one client who represented 27% 

and 28% of total revenue, respectively. 

During the yearn ended December 31, 2011 and 2010 the Company had one client who represented 32% 

and 61 % of accounts receivable, respectively. 

NOTE 8 - SUBSEQUENT EVENTS 

The Company has evaluated subsequent events through April 6, 2012, the date on which the 

consolidated financial statements were available to be issued. The Company has determined that there 

are no material subsequent events that would require disclosure in the financial statements through this 

date. 

12. 

PAGE 49 OF 132 
PAGE 50 OF 132 

Page 50 

CONSOLIDATING INFORMATION 

i 

I 

iCORHQ• 13-C·0148 
CORHQ-13-C-0148 

Page 51 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING BALANCE SHEET 

DECEMBER 31, 2011 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations 

ASSETS 

Current assets 

Gash and cash equivalents $ 213,108 $ 38,078 $ 

ln-.estment in subsidiary 29,184 (29,184) 

Accounts receivable 192,258 76,928 

Prepaid expenses 112,940 

Total current assets before 

funds held for clients 547,490 115,006 (29,184) 

Funds held for clients 2,402,347 1,609,961 

2,949,837 1,724,967 (29,184) 

Property and equipment, nBI. 806,840 

Other assets 17,990 

$ 3,774,667 $ 1,724,967 $ (29,184) 

LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable $ 135,134 $ $ 

Deferred rewnue 92,756 4,232 

Current portion of capitalized 

lease obligation 39,807 

Current portion of long-term debt 376,332 

Tota! current liabilities before 

client funds obligations 644,029 4,232 

Client funds obligations 2,392,474 1,609,961 

3,036,503 1,614,193 

Deferred rent expense 31,875 

Capitalized lease obligation, 

net of current portion 122,973 

Long-term debt, net of current portion 258,350 

3,449,701 1,614,193 

Stockholders' Equity 324,966 110,774 (29,184) 

$ 3,774,667 $ 1,724,967 $ (29,184) 

See accompanying notes to consolidated financial statements 

PAGE51 OF 132 

Consolidated 

$ 251,186 

269,186 

112,940 

633,312 

4,012,308 

4,645,620 

806,840 

17,990 

$ 5,470,450 

$ 135,134 

96,988 

39,807 

376,332 

648,261 

4,002,435 

4,650,696 

31,,875 

122,973 

258,350 

5,063,894 

406,556 

$ 5,470,450 

13. 
PAGE 52 OF 132 

Page 52 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING BALANCE SHEET 

DECEMBER 31, 2010 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations Consolidated 

ASSETS 

Current assets 

Cash and cash equivalents $ 36,559 $ 28,327 $ $ 64,886 

lmestment in subsidiary 29,184 (29,184) 

Accounts receivable 423,451 64,397 487,848 

Prepaid expenses 56,838 56,838 

Total current assets before 

funds held for clients 546,032 92,724 (29,184) 609,572 

Funds held for clients 2,284,214 1,653,742 3,937,956 

2,830,246 1,746,466 (29,184) 4,547,528 

Property and equipment, net 858,346 858,346 

Other assets 17,990 17,990 

$ 3,706,582 $ 1,746,466 $ (29,184) $ 5,423,864 

LIABILITIES ANO STOCKHOLDERS' EQUITY 

Current liabilities 

Accounts payable $ 104,682 $ $ $ 104,682 

Deferred rewnue 78,148 23,300 101,448 

Current portion of capitalized 

lease obligation 39,807 39,807 

Current portion of long-tenn debt 315,549 315,549 

Total current liabilities before 

client funds obligations 538,186 23,300 561,486 

Client funds obligations 2,277,710 1,653,614 3,931,324 

2,815,896 1,676,914 4,492,810 

Deferred rent expense 30,930 30,930 

Capitalized lease obligation, 

net of current portion 157,210 157,210 

Long-term debt, net of current portion 261,850 261,850 

3,265,886 1,676,914 4,942,800 

Stockholder.;' Equity 440,696 69,552 (29,184) 481,064 

$ 3,706,582 $ 1,746,466 $ (29,184) $ 5,423,864 

See accompanying notes to consolidated financial statements 

14. 

CORHQ-13-C-0148 
CORHQ-13-C-0148 

Page 53 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2011 

Benefit 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations 

Revenue 

F= $ 6,191,917 $ 1,159,757 $ 

Expenses 

Payroll expense 5,113,340 314,494 (314,494) 

CCS expense (1,011,592) 1,011,592 

Selling general & administratiw expenses 507,684 697,098 (697,098) 

Professional fees 403,212 19,926 

Repairs and maintenance expense 308,288 

Depreciation and amortization 276,741 

Rent expense 140,360 

Telephone expense 140,185 

Ad\ertising expense 118,094 

Insurance expense 71,864 

Auto expense 68,478 

Producer fees 54,573 

Taxes 36,683 

utilities 34,473 

Bank service charges 828 

6,273,211 1,031,518 

(Loss) income from operations (81,294) 128,239 

other Income (expense) 

Interest income 48 

Interest expense (40,346) 

Net (loss) income $ (121,640} $ 128,287 $ 

See accompanying notes to consolidated financial statements 

PAGE 53 OF 137 

Consolidated 

$ 7,351,674 

5,113,340 

507,684 

423,138 

308,288 

276,741 

140,360 

140,185 

118,094 

71,864 

68,478 

64,573 

36,683 

34,473 

828 

7,304,729 

46,945 

48 

(40,346) 

$ 6,647 

15. 
CORHO-13-C-0148 

Page 54 

BENEFIT ALLOCATION SYSTEMS, INC. AND SUBSIDIARIES 

CONSOLIDATING STATEMENT OF OPERATIONS 

FOR THE YEAR ENDED DECEMBER 31, 2010 

Beneli1 

Allocation Cobra Control 

Systems, Inc. Systems, Inc. Eliminations 

Revenue 

Fees $ 5,282,057 $ 1,132,623 $ 

Expenses 

Payroll expense 3,953,445 228,794 (228,794) 

CCS expense (630,383) 830,383 

Selling general & administrati1.e expenses 520,844 601,629 (601,589) 

Depreciation and amortization 285,345 

Professional fees 416,826 69,997 

Repairs and maintenance expense 155,715 

Telephone expense 146,614 

Rent expense 92,629 

Producer fees 78,765 

Auto expense 77,302 

Ad1.ertising expense 76,921 

Insurance expense 49,725 

Utilities 34,582 

T~~ 12,489 

Bank sen.ice charges 1,105 

5,071,924 900,420 

Income from operations 210,133 232,203 

Other income (expense) 

Interest income 128 

Interest expense (35,376) 

Net income $ 174,757 $ 232,331 $ 

See accompanying notes to consolidated financial statements 

PAGE 54 OF 132 

Consolidated 

$ 6,414,680 

3,953,445 

520,884 

285,345 

486,823 

155,715 

146,614 

92,629 

78,765 

77,302 

76,921 

49,725 

34,582 

12,489 

1,105 

5,972,344 

442,336 

128 

(35,376) 

$ 407,088 

16. 
(b )(6) 

(b )(6) 

CORltQ 13--C-0148 

l2'PNC 

May 13, 2013 

Arthur Taylor, President 

Benefit Allocation Systems Inc 

132 lvy Lane 

King of Prussia, Pa. 19406 

Re; confirmation letter 

Dear Mr. Taylor, 

Page 55 

This letter will conftnn that Benefit Allocation Systems Inc. opened their accounts 

in April 1995. The company maintains operating and escrow accounts with PNC Bank. 

These accounl<; have always been managed in a satisfactory manner. 

Sincerely, 

ThE PNC Firwnciai Serv)ces Group 

PAGE 55 OF 13 
Page 56 PAGE 56 OF 132 

Section C - Description/Specifications/Work Statement 

No attachments were added for this section. 

Clauses Incorporated By Reference 

Clause# I Title I Date 

No reference clauses were found for this section. 

Included Clauses 

7.3.2-34 - Duty to Deliver or Perform - July 2008 

Contractor agrees to perform the services (the "Services") or provide the goods (the "Goods"), in accordance with 

the terms and conditions set forth herein and in any attachments to the contract. 

7 .3.2-21 - Description!Specitications/Work Statement - October 2008 

The description of the services being acquired is as follows: 

THIRD PARTY BENEFITS ADMIN!STRA TOR 

The specifications for and the description of the work to be performed under this award are fully detailed in either a 

Statement of Work (SOW) which is included as an attachment in Section J of this award document. 

CORfi0-13-C-0148 
Page 57 

PAGE 57 OF 132 

Section E - Inspection and Acceptance 

No attachments were added for this section. 

Clauses Incorporated By Reference 

Clause# I Title I Date 

No reference clauses were found for this section_ 

Included Clauses 

7.6.4-01 - Inspection and Acceptance -July 2008 

(a) All goods and services shall be subject to inspection and test by the FDIC Oversight Manager, to the extent 

practicable, at all times and places during the term of the award. All inspections by the FDIC shall be made in such 

a manner as not to unduly delay the work. 

(b) The FDIC shall have TEN (10) business days from the date of Contractor's delivery to determine if such goods 

and services are in compliance with the requirements of the contract. If any services performed or goods delivered 

hereunder are not in conformity with the requirements of this Award, the FDIC shall have the right to require 

Contractor to reperform the services or redeliver the goods in conformity with the requirements of the Award, al no 

additional increase in total contract amount. When the services to be performed are of such a nature that the defect 

cannot be corrected by reperformance of the services, the FDIC shall have the right to (1) require Contractor 

immediately to take atl necessary steps to ensure future performance of the services in conformity with the 

requirements of the contract; and (2) reduce the contract price to reflect the reduced value of the services 

performed. In the event Contractor fails promptly to reperform the services or redeliver the goods, or to take 

necessary steps to ensure future pertormance of the services or delivery of the goods in conformity with the 

requirements of the Award, the FDIC shall have the right to either (1) by contract or otherwise, have the services 

performed or the goods delivered in conformity with the contract requirements and charge to Contractor any cost 

occasioned to the FDIC that is directly related to the performance of such services or the delivery of such goods; or 

(2) terminate this Award for default as provided in 7.6.6-2, Termination for Default. 

(c) Contractor shall provide and maintain an inspection system acceptable to the FDIC covering the goods or 

services to be delivered or pertormed hereunder. Records of all inspection work by Contractor shall be kept 

complete and available to the FDIC during the term of this Award and for such longer period as may be specified 

elsewhere in this Award. 

CORHQ-13-C-0148 
Page 58 

Section F - Deliveries or Performance 

No attachments were added for this section. 

Clauses Incorporated By Reference 

Clause# I Title I Date 

No reference clauses were found for this section. 

Included Clauses 

7.3.1-09 - Delivery Schedule -July 2008 

The servicesx shall be delivered in accordance with the terms outlined in the Statement of Work. The contractor 

shall coordinate all devliverables with the Oversight Manager. 

7.3.1-10 - Place of Delivery or Performance - July 2008 

The place of delivery or performance is: 

Contractor's Facilities. 

7.3.1-11 - Deliverables -July 2008 

The Contractor must provide all deliverables described in the statement of work. 

7.3.1-12 - Period of Performance - July 2008 

The period of performance begins on January 1, 2014 ("Effective Date") and expires on DECEMBER 31, 2016. 

CORHO-13-C-0148 

PAGE 58 OF 132 
Page 59 

PAGE 59 OF 132 

Section G - Contract Administration Data 

No attachments were added for this section_ 

Clauses Incorporated By Reference 

Clause# I Title l Date 

No reference clauses were found for this section. 

Included Clauses 

7.3.2-41 - FDIC Personnel - July 2008 

(a) FDIC Oversight Manager. The Oversight Manager is the person designated in writing by the Contracting 

Officer to represent the FDIC for the purpose of monitoring technical performance and accepting goods or services. 

The Oversight Manager is not authorized to issue any instructions or directions which effect any substantive change 

in this contract, including, but not limited to, an increase or decrease in the price of this contract, or a change in the 

delivery date(s) or Period of Performance. Specific areas of delegated authority are more particularly defined in the 

Oversight Manager Appointment Memorandum. 

The Oversight Manager is Louise Murril-Graves (703) 516-5297. 

(b) FDIC Contracting Officer. The Contracting Officer 1s the person with FDIC-delegated authority to enter into, 

modify, administer, and terminate contracts and orders. 

The Contracting Officer is James Thompson (703) 562-2593. 

7.5.13-01 - Method of Payment - Electronic Fund Transfer (EFT) - July 2008 

(a) Payment methods. Payments by the FDIC may be made by check or electronic funds transfer (EFT), or by a 

third party in lieu of payment directly from the FDIC, at the option of the FDIC. If the FDIC makes payment by EFT, 

the FDIC may, at its option, also forward the associated payment information by electronic transfer. Any third party 

payments will be made by the FOIC's commercial purchase card issuer. In the event Contractor certifies in writing 

to the payment office that Contractor does not have an account with a financial institution or an authorized payment 

agent, the FDIC would make payments by other than EFT. 

(b) Contractor Payment Requests. If the FDIC elects for third party payments to be made, Contractor shall make 

payment requests through a charge to the FDIC purchase card with the third party, at the time and for the amount 

due in accordance with the terms of this contract. Contractor and the third party shall agree that payments due 

under this contract shall be made upon submittal of payment requests to the third party in accordance with the 

terms and conditions of an agreement between Contractor, the Contractor's financial agent (if any), and the third 

party and its agents (if any). No payment shall be due the Contractor until such agreement is made. Payments 

made or due by the third party are not subject to the Prompt Payment Act or any implementation thereof in this 

contract. Documentation of each charge against the FDIC's purchase card shall be provided to the Contracting 

Officer upon request. Contractor is required, as a condition to any payment, to maintain current information in the 

CORHQ-13-C-0148 
Page 60 

Central Contractor Registration (CCR) database. Any invoice submitted with incorrect EFT information shall be 

deemed not to be a proper invoice as defined in the Prompt Payment Act clause herein. 

7.5.13-12 -Schedule for Invoicing - July 2008 

Contractor must submit invoices within TEN (10) days after the end of each month. 

7 .5.13-13 - Contents of Invoice - September 2010 

Contractor's invoices must include the following items in order to be processed for payment: 

(a) Contractor name, address and phone number. 

(b) Invoice date. (Contractors must date invoices as close as possible to the date of electronic transmission to 

FDIC.) 

(c) Invoice number. 

(d) Contract Number (e.g., Contract Number, Task Order Number, Delivery Order Number, etc.) 

(e) Line Item Number(s), as identified in the contract, and the amount invoiced for each Line Item Number. 

PAGE 60 OF 132 

(f) Allocation of all hours and expenses to Financial Institution Number (FIN) and Asset Name/Number, 1f applicable. 

(g) Description, quantity, unit of measure, unit price, extended price of goods delivered or services performed. 

(h) Total invoice amount. 

(i) Payment terms (discount for prompt payment terms). 

U) Remittance address. 

(k) Billing Point of Contact (e.g., name (where practicable), title, phone number, and mailing address of person to 

notify if there are questions regarding the invoice). 

(I) Shipping information (e.g., shipment number, date of shipment, bill of lading number and weight of shipment. 

Shipping charges, if any, must be shown as a separate item on the invoice. 

(m) For time and material or labor hour awards, copies of time sheets in support of direct labor charges. 

(n) If travel expenses are reimbursable under the award, Contractor must submit travel documentation, receipts 

and other proof of expenses as required by the FDIC Contractor Travel Reimbursement Guidelines. 

(o) If subcontractor expenses are reimbursable under a labor-hour or time-and-material award, Contractor must: 

(1) identify subcontractor expenses and costs separate from prime contractor expenses and costs on the 

invoice it submits to FDIC; 

(2) submit with its invoice, as supporting documentation, a copy of its subcontractor's invoice when seeking 

reimbursement of subcontractor expenses. 

(p) Pass through costs - If expenses or costs are reimbursable under the terms of the award, a description of each 

shall be provided in the invoice along with the quantity, unit amount, and total amount. Also, if amounts are derived 

from application of any formula, calculation, percentage, etc., such application must be clearly evident in the 

supporting documentation provided with the invoice. 

(q) The following certification statement, signed by an authorized company representative: 

"This is to certify that the services set forth herein [goods described herein] were performed [delivered] during the 

period stated. 

Contractor's Authorized Representative Date" 

(r) Any other information or supporting documentation required by the award. If an invoice does not contain the 

above required information: contains errors; or exceeds the total compensation ceiling limit for this award, the 

invoice will be returned to Contractor and processing of the invoice for payment will be delayed until the deficiency 

CORHQ-13-C-0148 
Page 61 

is corrected.In addition, the FDIC requires Contractors to maintain current information in the Central Contractor 

Registration (CCR) database. FDIC may reject any invoice received from Contractor where processing of the 

invoice cannot be completed because Contractor has failed to maintain its registration, including electronic funds 

transfer (EFT) information, in the CCR database. 

PAGF 61 or 132 

7 .5.13-14 - Electronic Invoice Preparation and Submission (CORHQ Business Unit) - July 

2008 

Contractor must follow the FD!C's electronic invoice preparation and submission instructions stated below: 

(a) Contractor must email electronic invoices to the FDIC's Division of Finance/Accounts Payable (DOF/AP) at the 

following address: DOFAPlnvoice@fdic.gov 

(b) Contractor must only email their invoices to the above DOF/AP email address and not the Oversight Manager 

(OM) or Contracting Officer. The FDIC will not accept hand-delivered invoices or invoices sent to any other address 

(i.e., FDIC street address or any other email addresses). 

(c} Contractor must submit the electronic invoice as a single file document, in pdf format. The file should include 

the exact same information that has been submitted physically via mail in the past. (FDIC only wants one electronic 

file because we will be uploading the single pdf into a database and we only want one file associated with an 

invoice. However, if the size of a single pdf file exceeds 30 MB, the invoice may either be submitted as two pdf 

files, with neither pdf file exceeding 30 MB, or it may be submitted as a zip file that does not exceed 30 MB. If two 

pdf files are used, each email must clearly identify that the invoice has been separated into two pdf files to 

accommodate the size limitation. If a zip file is used, the individual files inside the zip file must be kept to a 

minimum and each must have a descriptive file name, such as "Invoice cover page", "Timesheets", etc.) 

(d) Contractor must not include more than one electronic invoice in the same email. (For example, if a Contractor 

has four task orders, a separate email with a single invoice must be submitted for each of the four task orders.) 

(e) Contractor must name the pdf file or zip file in the following format (with invoice date shown as year/month/date 

followed by a space and the invoice number): 

Invoice date and invoice number (e.g., 2008-01-31 1067876) 

(f) Contractor's email subject line must include the words, "Contractor Invoice", followed by a hyphen and the 

Contract Number (or Task Order Number, or Delivery Order Number, as applicable), as shown in the example 

below: 

"Contractor Invoice - CORHQ-08-C-0000" 

(g) Task Assignments: For contracts and task orders containing provisions for Task Assignments, a separate 

invoice must be submitted via a separate email for each Task Assignment. 

(h) The counting of days for Prompt Payment begins on the dale the invoice is received in the inbox of the DOF/AP 

email address, until 4PM. Invoices received after 4PM will be counted as being received the following FDIC 

workday. 

COR.HQ-13-C-0148 
Page 62 PAGE 62 OF 132 

Section H - Special Contract Requirements 

No attachments were added for this section. 

Clauses Incorporated By Reference 

Clause# I Title Date 

No reference clauses were found for this section. 

Included Clauses 

7.3.2-43 - Key Personnel - July 2008 

(a) The following key personnel are essential to the proper performance of Contractor's duties under this contract 

See Attached Key Personnel Listing 

(b) Contractor must make the above named key personnel available for performance under this contract as long as 

such persons are employed by Contractor or its related entities. All key personnel changes must be authorized in 

writing by the FDIC Contracting Officer prior to the new key personnel beginning work. Contractor must give a 

minimum of a 14-day advance written notice to the FDIC Contracting Officer of any proposed substitutions of key 

personnel. The notice must describe the reason for the proposed change; give the name of the proposed substitute 

individual with a description of his educational and professional background; and include a completed background 

investigation questionnaire. The determination of acceptability of proposed substitute personnel ts in the sole 

discretion of the FDIC. 

7.3.5-01 - Emergency Preparedness - July 2008 

(a) If the contractor, at any time during the performance of this contracUorder, is determined by the FDIC (at its sole 

discretion) to provide services essential or critical to the FDIC mission (based on the nature of an actual or 

threatened emergency situation as declared by any competent federal, state or local authority), then upon such 

notice to the contractor by the FDIC contracting officer: the contractor shall take immediate and effective measures 

to ensure the availability or use of back-up or redundant services and/or system(s) support to deal with such 

emergency, and to ensure uninterrupted support of the services or system(s) support under the contracUorder so 

identified. 

(b) Any back-up or redundant services and/or system(s) support required under this provision (whether subject to 

reimbursement by FDIC or not, as described below) must be provided for as long as the actual or threatened 

emergency situation exists. 

(c} Any costs associated with providing back-up or redundant services and/or system(s) support provided by the 

contractor under this section must be reimbursed at a rate that must not exceed the current prices or hourly rates 

provided for in the contracUorder, unless such back-up or redundant services and/or system(s) support was a 

CORHQ-13-C-0148 
Page 63 PAGE 63 OF 132 

requirement of the contract/order in question and the costs for providing such back-up or redundant services and/or 

system(s) support was included in the contracVorder price. In this case, the contract/order requiring back-up or 

redundant services and/or system(s) support must be provided by the vendor as required at no additional cost to 

FDIC during the term of the contract/order, and must be subject to reimbursement only for the time the back-up or 

redundant services and/or system(s) support is provided beyond the expiration of the contract/order, if so required 

by FDIC. 

7 .4.2-01 - Security and Privacy Compliance for IT Services - July 2008 

(a} Security and Privacy Compliance. The Contractor is responsible for Information Technology (IT} security for 

Contractor Personnel and subcontractor personnel granted access to the FDIC network, and for their use of 

systems connected to the FDIC network, and for those systems developed, maintained, implemented or operated 

by the Contractor for FDIC. All IT products and services provided by the Contractor shall comply with all FDIC 

information security and privacy directives, policies and requirements unless Contractor obtains a written waiver 

from FDIC Information Security/Privacy staff. 

(b) Laws and Standards. All IT products and services provided by the Contractor must comply with Federal laws 

and standards addressing information security. These include: 

(1) The Privacy Act of 1974 (5 U.S.C. 552a) as amended (if incorporated in the contract); 

(2) Office of Management and Budget (0MB) Circular A-130, Management of Federal Information Resources 

(Transmittal Memorandum No. 4) including Appendices; 

(3) E-Government Act of 2002 (P. L. 107-347) including Title II, Section 208 - Privacy Provisions and Title Ill -

Federal Information Security Management Act of 2002 (FISMA), and related 0MB gwdance; and 

(4) National Institute of Standards and Technology (NIST) Federal Information Processing Standards (FIPS) 

and Special Publications. 

(c) FDIC Policy and Guidance. All IT products and services provided by the Contractor shall address information 

security and privacy requirements throughout their design, development, implementation, maintenance, operation, 

and termination as provided in FDIC system development life cycle policy and guidance. This includes completing 

or providing the necessary information for the FDIC to complete privacy impact assessments, security 

assessments, risk assessments, security plans, contingency plans, and other security and privacy artifacts as 

required. 

(d) Subcontracts. Contractor must include this clause in all its subcontracts to which the conditions and 

requirements described in this clause would apply. Contractor also must require Its subcontractors (first-tier) to 

include this clause in any of their subcontracts (second-tier) to which the conditions and requirements of this clause 

would apply. 

7.4.2-02 - Off-site Processing and Storing of FDIC Information - June 2010 

(a) Protection of Information. The Contractor shall implement adequate administrative, technical, physical and 

procedural security controls to ensure that all FDIC information in its possession or under its control is adequately 

protected from loss, misuse, and unauthorized access or modification. The collection, use, transmission, and 

disclosure of FDIC information shall comply with all federal and state privacy laws and FDIC rules and regulations 

regarding privacy. The Contractor shall further ensure that FDIC PII is separated both physically and logically from 

Contractor's data. The Contractor shall not use any FDIC information except to the extent necessary to carry out its 

obligations under the contract. Contractor shall not disclose FDIC information to any third party unless disclosure is 

CORHQ-13-C 0148 
Page 64 PAGE 64 OF 132 

authorized in the contract or Contractor obtains the prior written consent of the Contracting Officer. 

(b) Control of Information. All FDIC information remains the property of FDIC. At any time, upon request of the 

Contracting Officer. Contractor shall promptly retrieve and deliver to FDIC all FDIC information, or any portion of 

information as specified by FDIC, under the Contractor's control or in its possession. Information shall be provided 

in a format and on media as agreed by both parties. The Contractor shall not, and shall not permit any other 

person, to access, transmit, maintain, store, use or disclose the Confidential Information [Sensitive Information] 

outside of the United States. Upon completion or termination of the contract, or at any time the Contracting Officer 

requests it in writing, Contractor shall return, erase, or destroy all FDIC information on any media under its control 

or in its possession, as FDIC directs. 

(c) IT Security Plan. The Contractor shall implement and maintain the approved IT Security Plan, 

Physical/Environmental Security Plan, or the approved security audit or review, which is hereby incorporated into 

the contract, for the duration of the contract. The Contractor must demonstrate its continued compliance with the 

controls, processes and procedures described in the IT Security Plan (or the security audit or review) throughout 

the term of the contract, as FDIC may request. 

(d) Inspections/Assessments. The Contractor sha!I allow and cooperate with both scheduled and unannounced 

inspections and assessments of its facilities, personnel, hardware, software and its security and privacy practices 

by either the FDIC information technology staff, the FDIC Inspector General, or the U.S. General Accountability 

Office (GAO). These inspections may be conducted either by phone, electronically or in-person, on both a preaward basis and throughout the term of the contract or task order, to ensure and verify compliance with FDIC !T 

security and privacy requirements. 

(e) Monitoring and Incident Response. The Contractor shall monitor its facility and premises for security and privacy 

incidents and provide the capability to respond to and resolve them effectively and in a timely manner. All security 

and privacy incidents that involve FDIC information must be immediately reported to FDIC's Computer Security 

Incident Response Team (CSIRT). 

(f) Contact Information. The Contractor shall provide a point of contact (name, telephone number, e-mail address) 

with whom the Contracting Officer, Oversight Manager, and FDIC Information Security and Privacy Staff may 

communicate throughout the duration of the contract about information security and privacy issues. 

7.4.2-04 - Privacy Requirements for External Web Applications and Content -July 2008 

{a) The Contractor shall ensure that each publicly accessible web site that is developed or maintained for FDIC 

under this contract conforms to the privacy requirements of the E-Govemment Act of 2002 (44 U.S.C. Ch. 36). The 

web site shall not use persistent cookies or other persistent tracking devices, although session cookies may be 

used. The home page, all major entry points into the web site, and all web pages that collect personal information 

shall include a hyperlink labeled "Privacy Policy" that links to the FDIC's privacy policy located on FDIC.gov. 

(b) The Contractor shall provide access to FDIC for the purpose of performing scans or conducting other 

verification techniques to ensure the above requirements are met. 

7 .5.1-02 - Protecting Sensitive Information - September 2010 

CORIJQ-13-C-0148 
Page 65 PAGE 6Cl OF 132 

(a) Protecting Sensitive Information. Contractor, all Contractor Personnel, subcontractors and subcontractor 

personnel shall comply with FDIC Circular 1360.9, Protecting Sensitive Information, and protect the confidentiality, 

integrity and availability of sensitive information, including personally identifiable information (PII), to which they 

have access. FDJC Circular 1360.9 is available at the FDIC website: 

www.fdic.gov/buying/goods/acquisition/index.html 

(b) Controlling Sensitive Information. All sensitive information, electronic and paper copy, remains the property of 

FDIC. !f Contractor or Contractor Personnel moves or copies sensitive information to Contractor's facilities or 

equipment, they must maintain and store it separately, both physically and logically, from all non-FDIC information. 

Upon completion or termination of the contract, or at any time the Contracting Officer requests it in writing, 

Contractor must return, erase, or destroy all sensitive information on any media under its control or in its 

possession, as FDIC directs. 

(c) Sensitive Information Defined. Sensitive information is any information, the loss, misuse, or unauthorized 

access to or modification of which could adversely impact the interests of FDIC in carrying out its programs or the 

privacy to which individuals are entitled. It includes the following: 

(1) Information that is exempt from disclosure under the Freedom of Information Act, such as trade secrets 

and commercial or financial information, information compiled for law enforcement purposes, personnel and 

medical files, and information contained in bank examination reports; 

(2) Information under the control of FDIC contained in a Privacy Act system of record that is retrieved using 

an individual's name or by other criteria that identifies an individual; 

(3) PII about individuals maintained by FDIC that if released for unauthorized use may result in financial or 

personal damage to the individual to whom such information relates. Sensitive PII, a subset of PII, may be 

comprised of a single item of information (e.g., SSN) or a combination of two or more items (e.g., full name along 

with, financial, medical, criminal, or employment information). Sensitive PII presents the highest risk of being 

misused for identity theft or fraud; and 

(4) Information about insurance assessments, resolution and receivership activities, as well as 

enforcement, legal, and contracting activities. 

(d) Confidentiality Agreement. The Contractor, all key personnel and, at the discretion of FDIC, any designated 

non-key personnel working on the contract each must sign a confidentiality agreement. When FDIC determines 

non-key personnel are required to sign confidentiality agreements, the Oversight Manager shall provide the 

Contractor with a written notice of such and shall identify whether the requirement extends to all categories of nonkey personnel or selected categories of non-key personnel. FDIC Form 3700/46, Confidentiality Agreement (for 

Contractor) and FDIC Form 3700/46A, Confidentiality Agreement (for Contractor Personnel) are included as 

attachments to this contract. The company-level confidentiality agreement must be signed by an authorized 

representative of the Contractor and delivered to the Contracting Officer at the time of award, with the signed 

contract. Confidentiality agreements for key personnel and designated non-key personnel must be delivered to 

FDIC no later than five (5) business days after starting performance and prior to receiving any sensitive information. 

The Contractor must deliver the confidentiality agreements signed by key personnel to the Contracting Officer and 

those signed by designated non-key personnel to the Oversight Manager. Key personnel and designated non-Key 

Personnel who do not sign a confidentiality agreement will not be permitted to perform work on the contract. 

CORHQ-13-C-0148 
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PAGE 66 OF 132 

(e) Subcontracts_ Contractor must include this clause in all its subcontracts to which the conditions and 

requirements described in this clause would apply. Contractor also must require its subcontractors (first-tier) to 

include this clause in any of their subcontracts (second-lier) to which the conditions and requirements of this clause 

would apply. 

7.5.2-03 - Background Investigations -July 2008 

a) Any Contractor Personnel or subcontractor personnel who: 

- work on-site at and have unescorted access to FDIC offices or facilities, or 

- have access to FDIC networks/systems 

must undergo a background investigation, in accordance with FDIC Circular 1610.2. Jn addition, background 

investigations are conducted on all Contractor Personnel and subcontractor personnel on contracts and other 

awards for services with a value greater than $100,000, or on any contract or award at the discretion of the FDIC. 

The extent of the background investigation conducted will be In direct relation to the risk level assigned either in 

clause 7.5.2-9, Risk Level Designation - Entire Contract or In clause 7.5.2-10, Risk Level Designation - Labor 

Category. FDIC Circular 1610.2 is available at the FDIC website: www.fdic.gov/buying/goods/acquisition/index.html 

b) Prior to obtaining an FDIC identification/access badge and commencing work under the contract, Contractor 

Personnel and subcontractor personnel are required to undergo both a fingerprint and a credit check. ln addition, 

Contractor Personnel and subcontractor personnel may be subject to an OPM background investigation, based on 

the risk level assigned to the contract or to the labor categories. No Contractor Personnel or subcontractor 

personnel, including any new personnel added at any time during the term of the contract, shall be permitted to 

begin work until the fingerprint and the credit check processes have been completed and FDlC has rendered a 

favorable determination, and the paperwork for any further OPM background investigations has been submitted. 

c) Contractor must provide the Oversight Manager with the following documents for all Contractor Personnel and 

subcontractor personnel subject to the background investigation requirement: 

1) An executed Background Investigation Questionnaire for Contractor Personnel and Subcontractors (FDIC 

1600/04); 

2) An executed Notice and Authorization Pertaining to Consumer Reports (FDIC 1600/1 O); 

3) A Fingerprint Card (The contractor must submit FD Form 258 Fingerprint Card or coordinate with the Oversight 

Manager to schedule fingerprinting by the Security and Emergency Preparedness Section of FDIC.) 

FDIC Forms 1600/04 and 1600/10 are available at the FDIC website: 

www_fdic.gov/buying/goods/acquisition/index.html 

In addition, where the assigned risk level of the contract mandates background investigations by the Office of 

Personnel Management, the Contractor must provide the Oversight Manager with the completed paperwork for 

Contractor Personnel and subcontractor personnel needed to initiate an OPM background investigation. The 

Oversight Manager will notify the Contractor of the method by which to submit the paperwork - either manually, 

using Standard Form 85P Questionnaire for Public Trust Positions, or via e-QIP (the OPM ElectronicQuestionnaires-for-Investigations-Processing system). If any Contractor Personnel or subcontractor personnel 

have received a background investigation-clearance from another federal agency within the last 5 years, at the 

same or a higher risk level as that assigned to this contract, the Contractor may also provide the following to the 

OM, 

CORHQ-13-C-0148 
Page 67 PAGE 67 OF 132 

A Certificate of Investigation or a Letter of Consent or other documentation from a government agency, verifying 

the date of the investigation, the investigating agency, the type of investigation completed and the clearance given. 

d) Any Contractor Personnel or subcontractor personnel, whose background investigation reveals an adverse 

finding, may be excluded from working on the contract at the discretion of the Contracting Officer. Contractor is 

obligated to replace any personnel so excluded with personnel acceptable to FDIC. Replacement of personnel 

shall be made at no additional cost to the FDIC and without relieving Contractor of performance and delivery 

requirements of the contract. 

e) Contractor must comply with Homeland Security Presidential Directive-12 (HSPD-12) and Federal Information 

Processing Standard Publication 201 (FIPS 201) entitled "Personal Identification Verification for Federal Employees 

and Contractors". Contractor Personnel and subcontractor personnel must present two forms of identification in 

original form prior to badge issuance; at least one document must be a valid State or federal government-issued 

picture ID. Acceptable forms of identification are listed in Form 1-9, 0MB No., 1615-0047, Employment Eligibility 

Verification. In addition, Contractor Personnel and subcontractor personnel must appear in person at least once 

before an FDIC official who is responsible for checking the identification documents. FDIC will not issue 

identification/access badges to Contractor Personnel and subcontractor personnel until proof-of-identity has been 

established. 

f) Subcontracts. Contractor must include this clause in all its subcontracts to which the conditions and requirements 

described in this clause would apply. Contractor also must require It subcontractors (first-tier) to include this clause 

in any of their subcontracts (second-tier) to which the conditions and requirements of this clause would apply. 

7.5.2-09 - Risk Level Designation (Entire Contract) -July 2008 

The nsk level for this contract is: MODERATE. The post-award background investigations for this contract will be 

done at this risk level. 

7.5.2-11 - Identification/Access Badges - July 2008 

All contractor and subcontractor employees regularly working on-site at an FDIC facility must be issued an 

identification/access control badge. Such employees will not be granted on-site access until receiving the badge. 

Renewal of the badges is required semiannually. 

7.5.2-12 - Contractor Notification of Departing Employee -August 2012 

No later than the date of departure of a Contractor or Subcontractor employee who has been issued an FD!C 

badge, granted FDIC network access, or receive any of the following: FDIC property/equipment (including laptop or 

network access token), Personally Identifiable Information (P/I), parking permits, office keys, access cards and/or 

building passes, the Contractor must notify FDIC of the employee's departure. The notification shall be emailed to 

the Oversight Manager and must include the following: 

(a) Contract number; 

(b) Contractor name (and Subcontractor name, if departing employee works for a Subcontractor); 

(c) Departing employee name; and 

(d) Date of departure. 

CORHQ-13-C-0148 
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7.5.2-13 - Use of FDIC Premises by Contractor Personnel - July 2008 

Contractor shall comply with the FDIC directives governing access to and operations at FDIC offices and facilities, 

while on FDIC premises_ The directives are available at the FDIC website: 

www.fdic.gov/buying/goods/acquisition/index.html, or may be obtained from the Oversight Manager. Contractor is 

responsible for assuring that its personnel understand and observe these directives. Contractor shall perform its 

contract activities in a manner which does not interrupt or interfere with the business conducted at FDIC. 

Subcontracts. Contractor must include this clause in all its subcontracts to which the conditions and requirements 

described in this clause would apply. Contractor also must require it subcontractors (first-tier) to include this clause 

In any of their subcontracts (second-tier) to which the conditions and requirements of this clause would apply. 

7.1.3-2 - Post-Government Employment Certification (Post-Award) - May 2009 

Any former Federal Deposit Insurance Corporation (FDIC) or Resolution Trust Corporation (RTC) employee who 

the contractor intends to use in performance of work under the contract or its subcontracts must complete and 

submit the post-government employment certification found at FDIC website 

www.fdic.gov/buying/goods/acquisition{lndex.html. The certification must be submitted to the Contracting Officer 

prior to the former employee commencing work under the contract. The FDIC Legal Division Ethics Unit will review 

the certification to determine compliance with the post-government employment restrictions. The former employee 

may be required to provide additional information as to their position and responsibilities while employed at FDIC or 

RTC and as a post-government employee working on the FDIC contract or subcontract. 

CORHQ-13-C-0148 
Page 69 

Section I - Contract Clauses 

No attachments were added for this section. 

Clause# 

7.3.1-13 

7.3.1-14 

7.3.2-35 

7 .3.2-40 

7.3.2-42 

7.3.2-44 

7.3.2-54 

7.3.2-58 

7.3.2-59 

7.3.2-60 

7.3.2-61 

7.3.2-62 

7.3.2-63 

7 .3.2-64 

7.3.2-65 

7.5.1-01 

7 _5.4-06 

7.5.6-05 

7.5.8-04 

7.5.8-05 

CORHQ-13-C-0148 

I 

Clauses Incorporated By Reference 

Title 

OIG Fraud Hotline 

Order of Precedence 

Calendar Days 

Change in Physical Location 

Contractor Personnel 

Representations of Contractor 

Cooperation with the Office of Inspector General 

Limitation on Payment to Influence Certain Federal Transactions 

Warranty Concerning Contingent Fees 

Anti-Kickback Procedures 

Drug-Free Workplace 

Equal Opportunity 

Affirmative Action for Workers with Disabilities 

Affirmative Action for Special Disabled Veterans and Vietnam Era 

Veterans 

Employment Reports on Special Disabled Veterans and Vietnam 

Era Veterans 

Privacy Act 

FDIC Rights in Data - General 

Subcontracting Plan Compliance 

Notice to the FDIC on Damage 

Cost of Insurance 

PAGE 69 OF 132 

I Date 

Ju!y 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

July 2008 

March 2011 

July 2008 

July 2008 
7.5.8-11 

7.5.9-01 

7.5.11-01 

7.5.12-05 

7.5.12-07 

7.5.13-05 

7.5.13-10 

7.5.13-11 

7.5.13-16 

7.5.13-17 

7.5.13-18 

7.5.14-02 

7.6.4-03 

7.6.5-01 

7.6.5-03 

7.6.6-01 

7.6.6-02 

7.6.6-04 

7.3.2-73 

7.6.5-05 

CORHQ-13-C-0148 

Page 70 

PAGE 70 OF 132 

Liability to Third Persons July 2008 

FDIC Exempt from Federal, State, and Local Taxes July 2008 

Service Contract Act of 1965 July 2008 

Trade Agreements October 2009 

Restrictions on Certain Foreign Purchases July 2008 

Payments Under Fixed Price Awards June 2009 

Travel Expenses (Reimbursable) July 2008 

Fees and Expenses of Subcontractors July 2008 

Central Contractor Registration July 2008 

Right to Offset Contract Payments Against Delinquent Obligations July 2008 

Prompt Payment December 2008 

Notice and Certification of Claims July 2008 

Risk of Loss or Damage July 2008 

Changes July 2008 

Stop Work Order July 2008 

Termination for Convenience of the FDIC July 2008 

Termination for Default July 2008 

Excusable Delays July 2008 

Compliance with 12 CFR Part 366 and Application of 12 CFR Part September 2009 

367 

Assignment of Claims July 2008 
Page 71 PAGE 71 OF 132 

lnduded Clauses 

7.3.1-15 -Governing Law-July 2008 

This contract is governed by Federal law and will be construed accordingly. To the extent State law may apply, in 

the case where there is no applicable Federal law, the State law that applies is the law of the State in which the 

FDIC office executing the contract is located (or the law of the District of Columbia for contracts executed by the 

FDIC office located in the District of Columbia). 

7 .3.2-33 - Independent Contractors - July 2008 

The FDIC retains Contractor as an independent contractor for the sole purpose of performing the services or 

providing the goods described in this contract If subcontracting is permitted, the use of the term "Contractor'' 

herein refers to both the Contractor and all Subcontractors at all levels. Contractor must ensure that all 

Subcontractors adhere to all of the terms and conditions of this contract that have flow-down requirements. 

7.3.2-37 - Audit of Records - July 2008 

(a) Audit and Inspection Rights. The FDIC, through its Contracting Officer or his designated representative(s), has 

the right to audit and examine Contractor's records and inspect its facilities. The scope of these rights is described 

below. 

(b) Examination of Costs. Contractor is required to maintain sufficiently detailed records of the costs it incurs in 

performing this contract The FDIC has the right to audit and examine Contractor's books and records, and its 

accounting procedures and practices, regardless of their form (e.g., machine readable media) or type (e.g., data 

bases, applications software, data base management software,). The FDIC has the right to inspect, at reasonable 

times, the facilities used by Contractor during performance of the contract. 

(c) Reports. If Contractor is required to furnish cost, funding or performance reports, the FDIC has the right to audit 

and examine Contractor's books, records, other documents and supporting materials to evaluate (1) the data 

underlying the reports and (2) the effectiveness of Contractor's policies and procedures to produce data compatible 

with the objectives of these reports. 

(d) Comptroller General. 

(1) The Comptroller General of the United States, or his authorized representative, shall have access to and 

the right to examine any of the contractor's directly pertinent records involving transactions related to this contract 

or a subcontract hereunder for a period of three (3) years following final payment under the contract. 

(2) The penod of access and examination is automatically extended for records relating to claims or litigation 

arising from the performance of this contract, or costs and expenses of this contract to which the Comptroller 

General has taken exception, and continues until all claims, litigation, appeals or exceptions are resolved. 

(3) This paragraph may not be construed to require contractors or subcontractors to create or maintain any 

record that the contractor or subcontractor does not maintain in ordinary course of business or pursuant to a 

provision of law. 

(e) Retention Requirement. Contractor must retain the materials described in paragraphs (b) and (c) above for 

three (3) years following final payment under this contract, or for any longer period required by statute or another 

clause in this contract. Contractor must make the materials available to the FDIC for audit, examination and 

CORHQ-13-C·0148 
PAGE 72 OF 132 

Page 72 

reproduction, at reasonable times during the retention period. Contractor must also provide the FDIC with working 

space at its facilities to conduct the audit and examination. If this contract is terminated, completely or partially, 

Contractor must maintain the materials described in subparagraphs (b) and (c) above for three (3) years following 

any final settlement Contractor must maintain, and make available to the FDIC, records relating to appeals under 

the "Disputes" clause of this contract, or to claims or litigation arising under or from this contract, until the appeals, 

claims or litigation are resolved. 

(f) Computer Data. Contractor may transfer computer data in machine readable form from one reliable computer 

medium to another. Contractor's computer data retention and transfer procedures must maintain the integrity, 

reliability and security of the original data. Contractor's choice of media affects neither Contractor's obligations nor 

the FDIC's rights under this clause. 

(g) Subcontracts. Contractor is required to insert a clause containing all the terms of this clause, including this 

subparagraph (g) - altered as necessary to identify properly the contracting parties and the Contracting Officer 

under the FDIC prime contract- in all subcontracts under this contract that exceed $100,000. 

7.3.2-57 - Public Release of Contract Award and Advertising and Publicity Information -

January 2011 

(a) The Contractor, its affiliates, agents or subcontractors, and their respective employees shall not issue press 

releases or provide other information to the public regarding any FDIC contract award. 

(b) The Contractor, its affiliates, agents or subcontractors, and their respective employees shall not make 

statements to the media or issue press releases regarding the goods or services provided under this Contract. 

Requests for information from anyone representing themselves as working for, or on the behalf of, a media or news 

organization must be directed to the Contracting Officer, who will obtain appropriate approval from the FDIC Office 

of Public Affairs at 202-898-6993. 

(c) Advertising or publicity materials (including the placement of information in its website): 

(1) The Contractor may include a reference to "FDIC" or "Federal Deposit Insurance Corporation" in a list of the 

Contractor's clients, along with a short, broad description of the goods or services provided, such as "FDIC - IT 

Services" or "FDIC - Security Services". In no event may any confidential information regarding the details of the 

contract or the name of the financial institutions where work is being performed be disclosed. 

(2) Without the prior written approval from the Contracting Officer, the Contractor shall not: 

(i) issue or sponsor any advertising or publicity (including the placement of information in its website) that states or 

implies the FDIC endorses, recommends or prefers the Contractor's goods or services. (ii) use the FDIC's logo or 

other FDIC material or refer to the FDIC in its advertising and publicity materials (including its website). 

All requests for such approvals must be submitted to the Contracting Officer at least 30 days prior to the scheduled 

release of advertising or publicity materials. The Contracting Officer will coordinate with the FDIC Office of Public 

Affairs and notify the Contractor of the final decision. 

(d) The prohibitions addressed in the preceding paragraphs also apply to information placed on social networks 

CORHQ-13 C-0148 
Page 73 

(Twitter, Linkedin, Facebook, biogs, etc.), 

(e) The Contractor agrees to include this clause in all its subcontracts under this contract 

7.3.2-69 -Joint and Several Liability -July 2008 

If Contractor is organized as a joint venture, the liability of the members of the joint venture in connection with all 

duties, obligations and liabilities under this Contract is joint and several. 

7.5.3-02 - "Section 508, Electronic and Information Technology (EIT) - (Contract or Task 

Order) - July 2008 

PAGE 73 OF 132 

Electronic and 1nfonnation technology (ElT) purchased, developed or maintained under this contract or task order 

must conform to and be in compliance with the applicable provisions of the Architectural and Transportation 

Barriers Compliance Board's (Access Board's) Electronic and Information Technology Accessibility Standards 

(Subpart B, 36 CFR Part 1194) at the time of delivery. 

The applicable Standard(s) for this contract [is] [are]: 

[] 1194.21 

[X] 1194.22 

[ ] 1194.23 

[ ] 1194.24 

[ J 1194.25 

[ J 1194.26 

Contractor shall also comply with Subpart C, CFR Part 1194.31 - Functional Performance Criteria and Subpart D, 

36 CFR section 1194.41 - Information, Documentation, and Support. 

Under any maintenance agreement, Contractor agrees to mamtain compliance with Section 508 of the 

Rehabilitation Act of 1973 for all hardware/software. 

7.5.5-01 - Option Period - July 2008 

The period of performance may be extended, at the discretion of the FDIC, for Two (2) One-year ( "Option 

Period(s)"). Except where specifically indicated otherwise, "Period of Performance" as used hereafter in this 

Contract refers both to the initial Period of Performance and to any Option Period which may be exercised. 

Option Period I -- January 1, 2017 through December 31, 2017 

Option Period !I - January 1, 2018 through December 31, 2018 

7.5.5-02 - Notice of Exercise of Option - July 2008 

lf the FDIC desires to exercise the option to extend the Period of Performance, the FDIC must notify Contractor, in 

writing, of its intent not less than THIRTY (30) days before the expiration of the current Period of Perfonnance. 

CORHQ-13-C-0148 
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PAGE 74 OF 132 

7.5.6-02 - Subcontracting Reporting - March 2012 

If subcontracting is approved under this award, the Contractor must submit a subcontracting report, on a quarterly 

basis, addressing the following for each subcontractor· 

a. Subcontractor's Name, Address, and DUNS number. 

b. Subcontractor's type of business concern [Minority Owned (including ethnicity), Women Owned, Small Business, 

Small Disadvantaged Business, Small Business Administration 8(a), Historically Underutilized Business 

Zones(HUBZones), Veteran Owned, and/or Service Disabled Veteran Owned Business]. 

c. Estimated percentage of the contract work to be performed by the subcontractor. (Applicable only to awards with 

Subcontracting Plans.) 

d. Description of work performed by subcontractor during the report period and dates, or range of dates, 

performance was accomplished. 

e. Compensation paid to subcontractor during reporting period. 

f. Total compensation paid to subcontractor cumulative to date. 

*g. Percentage completion toward Subcontracting Plan goals. (Applicable only to awards with Subcontracting 

Plans.) 

The Contractor must provide the subcontracting report to FDIC using the FDIC Subcontracting Reporting System 

(SRS). The SRS is a web-based system that is accessible via the internet at https://www2.fdic.gov/SRSweb/. 

Contractor may access a copy of the SRS Prime Contractor User Guide in the Miscellaneous section of the 

following webpage: http://www.fdic.gov/buying/goods/acquisition/index.html. 

The subcontracting report must be submitted within 15 days after the end of each quarter (i.e., by April 15th for 

Quarter 1 ending March 31st, by July 15th for Quarter 2 ending June 30th, by October 15th for Quarter 3 ending 

September 30th, and by January 15th for Quarter 4 ending December 31st. 

*(Note: Contractor will not be able to enter into SRS the information required under paragraph g until SRS 

undergoes a modification/upgrade. Contractor shall collect the information so they can complete these 

requirements once SRS has been modified/upgraded.) 

7.5.6-04 - Approved Subcontractors and Consent to Subcontract - February 2010 

Contractor must not engage subcontractors to perform any of its responsibilities without the prior written approval of 

the FDlC. Subcontractors identified in Contractor's proposal prior to award are deemed approved. Contractor must 

notify the FDIC of any changes in subcontracting arrangements. If Contractor proposes to add a subcontractor 

after award, Contractor must obtain consent from the Contracting Officer. Contractor must send a written request to 

the Contracting Officer, along with a Subcontracting Plan, or amended Subcontracting Plan, as applicable, which 

sets forth the following: 

(1) Name, address and DUNS number of the subcontractor: 

(2) Summary of capabilities of the subcontractor; 

(3) Description of roles of Key Personnel of the subcontractor: 

(4) Estimated percentage of work to be performed by the subcontractor; 

(5) Description of work to be performed by the subcontractor; 

(6) Minority or Woman Owned Business (MWOB) designation of the subcontractor, i.e., Women-Owned, MinorityCORHQ-13-C-0148 
Page 75 

PAGE 75 OF 132 

Owned. lf Minority-Owned, also provide the subcontractor's ethnic/racial category from the following list 

Asian-Pacific American 

Subcontinent Asian (Asian-lndian) American 

Black American 

Hispanic American 

Native American 

Other than one of the preceding; 

(7) SOB certification, if any, of subcontractor; and 

(8) Rationale and the offerer's policy for subcontracting, including a description of how the subcontracting 

commitments will be met. 

In the case of time and material or labor hour contracts, the contractor must provide pricing support for the 

reasonableness of the proposed labor rates_ If markup on the subcontractor rates has been approved by the 

Contracting Officer, any proposed markup rates must be identified in the pricing support. 

Subcontractor must not begin work until the contractor receives written approval by the FDIC Contracting Officer. 

The following subcontractors are approved for performance under this contract: ____ _ 

Consent by the FDIC to any proposed subcontractor does not: ( 1 ) constitute a determination of the acceptability of 

any subcontract terms or conditions; or (2) constitute a determination of the acceptability of any amount paid under 

any subcontract; or (3) relieve Contractor of any of its responsibilities under the award. Contractor must notify the 

FDIC Contracting Officer of any changes in subcontracting arrangements. 

7.5.8-01 - Liability Insurance - April 2010 

Contractor, before commencing work or permitting any subcontractor to commence work, shall procure and 

maintain the following insurance or, should such insurance be cancelled, the FDIC shall have the right to procure 

such insurance and the cost thereof shall be deducted from monies then due or which thereafter become due to 

Contractor. Contractor may carry any additional insurance as it may deem necessary. Contractor shall not be 

deemed to be relieved of any responsibility by the fact that Contractor carries insurance. The FDIC shall require 

any contractor of the FDIC performing work on FDIC premises to carry and maintain, at no expense to the FDIC: 

(a) Worker's Compensation and Employer's Liability Insurance in accordance with the applicable laws of the state in 

which the work is to be performed or of the state in which Contractor is obligated to pay compensation to 

employees engaged in the performance of the work. The policy limit under the Employer's Liability Insurance 

section shall not be less than One Hundred Thousand Dollars ($100,000) for any one accident; and 

(b) Comprehensive Bodily Injury and Property Damage Liability Insurance covering the work, the performance of 

the work and everything incidental thereto, with Bodily Injury (including death) and Property Damage limits of not 

less than Five Million Dollars ($5,000,000) per occurrence combined single limit. This policy shall be endorsed to 

cover: Contractual liability coverage, completed operations coverage, and broad form property damage 

endorsement; and 

CORHQ-13-C-0148 
Page 76 

PAGE 76 OF 132 

(c) Automobile Public Liability and Property Damage Insurance, including coverage on owned, hired, and nonowned automobiles and other vehicles, if used in connection with the performance of the work, with Bodily Injury 

and Property Damage limits of not less than One Million Dollars ($1,000,000) per occurrence combined single limit; 

and 

(d) Such other insurance as may be required elsewhere in the Agreement documents. 

The FDIC shall be named as Additional Insured under Contractor's Comprehensive Bodily Injury and Property 

Damage Liability Insurance, and Automobile Public Liability and Property Damage Insurance coverage. 

Contractor's insurance shall be primary. 

7.5.8-02 - Certificates of Insurance -July 2008 

Contractor must provide to the Contracting Officer, no later than ten (10} calendar days after the date of execution, 

a Certificate of Insurance, identifying the required types of insurance and dollar limits. The Certificate of Insurance 

must include the following FDIC mailing address and reference the contract number: 

Federal Deposit Insurance Corporation 

Attention: Marcelle Brown E4118 

3501 Fairiax Drive 

Arlington, VA 22226 

Reference: Contract No. CORHQ-13-C-XXXX 

Contractor must have its insurance carrier or carriers certify to the FDIC that all insurance required is in force, such 

certificates to stipulate that the insurance will not be cancelled or substantially changed without thirty (30) days prior 

notice by Certified Mail to the FDIC Contracting Officer. 

Upon request of the Contracting Officer, Contractor must provide the FDIC with a binder or a copy of the original 

insurance policy. 

7.5.14-01 - Disputes -June 2012 

Except as otherwise provided in this award, any factual dispute arising under this award, which is not disposed of 

by agreement, will be decided by the Contracting Officer. The Contracting Officer must, within 60 days, decide the 

claim or notify the contractor of the date by which the decision will be made. The Contracting Officer will furnish the 

contractor with a copy of the written decision_ 

The decision of the Contracting Officer is final and conclusive unless the contractor submits a written request for 

appeal of the decision to the Division of Administration, Acquisition Services Branch (ASB), Deputy Director, within 

60 days from receipt of the Contracting Officer decision. The ASB Deputy Director must, within 30 days, decide the 

claim or notify the contractor of the date by which the decision will be made. The decision of the ASB Deputy 

Director is final and conclusive unless a court of competent jurisdiction finds the decision fraudulent, arbitrary and 

capricious, so grossly erroneous as to imply bad faith, or not supported by substantial evidence. The contractor has 

180 days from the date of the ASB Deputy Director's decision to appeal to a court of competent jurisdiction. 

Contractor will be afforded an opportunity to be heard and to offer evidence in support of its appeal, if it requests. 

CORHQ-13-C-0 148 
Page 77 PAGE 77 OF 132 

Pending final decision of a dispute, Contractor remains obligated to proceed diligently with the performance of the 

contract, in accordance with the Contracting Officer's decision. 

Questions of law may be considered in deciding disputes under the process described above. However, 

consideration of questions of law by any administrative official, representative or board is not a final decision, and is 

not to be construed as one. 

7.0.1-02 - Clauses Incorporated by Reference - October 2008 

This contract incorporates one or more clauses by reference, with the same force and effect as if they were given in 

full text. The full text of a contract clause is available in Module 7 of the document entitled Procedures, Guidance 

and Information (PGI), which may be accessed electronically at the FDIC website: 

www.fdic.gov/buying/goods/acquisition/index.html. 

7.3.2-72 - FDIC Contracting Capacity - Contracts/Task Orders/Delivery Orders -July 2009 

FDIC is acting in its corporate capacity for this award and will execute ii in this capacity throughout the period of 

performance. 

7.6.4-04 - Fair Inclusion of Women and Minorities - August 2011 

(a) Contractor confirms its commitment to equal opportunity in employment and contracting. To implement this 

commitment, the Contractor shall ensure, to the maximum extent possible consistent with applicable law, the fair 

inclusion of minorities and women in its workforce. The Contractor shall insert the substance of this clause in all 

subcontracts under this Contract whose dollar value exceeds $100,000. Within ten business days of a written 

request from the Contracting Officer, or such longer time as the Contracting Officer determines, and without any 

additional consideration required from FDIC, the Contractor shall provide documentation, satisfactory to FDIC, of 

the actions it (and as applicable, its subcontractors) has undertaken to demonstrate its good faith effort to comply 

with the aforementioned provisions. For purposes of this contract, "good faith effort" may include actions by the 

contractor intended to identify and, if present, remove barriers to minority and women employment or expansion of 

employment opportunities for minorities and women within its workforce. Efforts to remove such barriers may 

include, but are not limited to, recruiting minorities and women, providing job-related training, or other activity that 

could lead to those results. 

(b) The documentation requested by the Contracting Officer to demonstrate "good faith effort" may include, but is 

not limited to, one or more of the following: 

1 The total number of Contractor's employees, and the number of minority and women employees, by race, 

ethnicity, and gender (e.g., an EEO-1); 

2. A list of subcontract awards under the Contract that includes: dollar amount, date of award, and subcontractor's 

minority and/or gender ownership status; 

3. Information similar to that required in item 1, above, with respect to each subcontractor with a subcontract value 

that exceeds $100,000; and/or 

4. The Contractor's plan to ensure that minorities and women have appropriate opportunities to enter and advance 

within its workforce, including outreach efforts. 

(c) Consistent with Section 342(c)(3) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. 

111-203, 124 Stat. 1376 (2010) (Dodd-Frank Act), a failure to demonstrate to the Director of FDIC's Office of 

CORHQ-13-C-0148 
Page 78 PAGE 78 OF 132 

Minority and Women Inclusion such good faith efforts to include minorities and women in the Contractor's workforce 

(and as applicable, the workforce of its subcontractors), may result in termination of the Contract for default, referral 

to the Office of Federal Contract Compliance Programs, or other appropriate action. 

(d) For purposes of this clause, the terms "minority," "minority-owned business" and "women-owned business" shall 

have the meanings set forth in Section 342(g) of the Dodd-Frank Act. 

(e) Contractor must provide the following certification to the Contracting Officer, annually, no later than the 

anniversary of the effective date of the Contract or ordering agreement. 

Contract Number: ·-------

Contractor Name:. ______ _ 

Certification Regarding Fair Inclusion of Minorities and Women 

The Contractor certifies to the following: [ ] Yes [ ] No 

(1) It is committed to equal opportunity in employment and contracting. 

(2) It has made and will continue to make, or will make during the course of this contract, a good faith effort to 

ensure, to the maximum extent possible, the fair inclusion of minorities and women in its workforce and in the 

workforces of its applicable subcontractors, 

(3) For purposes of this certification, 

"minority" shall have the meaning set forth in Section 342 (g) of the Wall Street Reform and Consumer Protection 

Act, Pub. L. No. 111-203, 124 Stat.1376 (2010); and 

"Applicable Subcontractor" refers to all tiers of subcontractors under this contract whose subcontract exceeds 

$100,000 in value; and 

"Good faith effort," may include actions by the contractor intended to indentify and, if present, remove barriers to 

minority and women within its workforce or expand employment opportunities for minorities and women within its 

workforce. Efforts to remove such barriers or expand employment opportunities may include, but are not limited to, 

recruiting minorities and women, providing job-related training, or other activity that could lead to those results. 

If the Contractor answers "No" to the certification above, an explanation must be provided: 

COR.H0-13-C-0148 
Page 79 

Section J - List of Attachments 

The table below lists all of the attachments for Section J which start on the following page 

Order of Appearance I Name 

Attachments B-1 B - 1 Price Schedule 

Attachments J-1 

Attachments J-2 

J - 1 Satement of Work and Appendices 

J - 2 Key Personnel Listing 

Attachments for this section start after this page. 

CORHQ-13-C-0148 

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Page 80 

Third Part}' Administrator Services 

(Employee Benefits and Training Programs) 

Statement of Work 

I. Introduction/Scope 

This is to request proposals from Offcrors to provide third party administrator services 

necessary to administer certain employee benefits and training programs of the Federal 

Deposit Insurance Corporation (FDIC). The services requested of a contractor, referred to as 

a Third Party Administrntor (fPA) are as follmvs: 

1. Systems development and maintenance, to facilitate interface with support data systems, 

ne\v employee on-boarding, online self-service enrollment, enrollee recordkeeping, 

and/or related administrative services for the: 

• ''FDIC Choice" flexible cafeteria benefits program, including claims processing 

services for Dependent Care and Health Care Flexible Spending Accounts, 

• FDIC Dental Insurance for Retirees, 

• FDIC Basic Life Insurance for Retirees, 

• FDIC Domestic Partner Program (including Health Insurance Premium 

Reimbursement), 

• FDIC Parking Flexible Spending Account (including claims processing), 

• FDIC Professional Leaming Accounts Program (including Career Development Plan 

processing), and 

• FDlC Benefits Hotline Call Center. 

2. Administrative services: 

• for billing and accounts receivable activities related to continuing FDIC Dental 

Insurance (covering retirees and surviving dependents) 

• for claims processmg activities related to the Health Insurance Premium 

Reimbursement provis10n of the Domestic Partner Program, and 

• in support of FDIC's semi-annually reimbursing a portion of health premiums paid 

by certain retirees who accepted buyouts in years 1994 through 1996 and eligible reemployed annuitants. 

3. Operate the FDIC Benefits Hotline Call Center lo provide ongoing customer support 

services to employees, retirees, sun-iving dependents and administrators/supervisors 

regarding both FDIC-sponsored benefits and Federally-sponsored benefits. The TPA 

shall furnish all labor, materials and scn-'ices necessary to successfully complete the 

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Page 81 

required work/operations including qualified personnel, office space, office furniture and 

fixtures. toll-free phone lines including one for hearing impaired individuals, FAX lines 

and equipment voicemail accounts, email accounts, office supplies, computers and 

softviare, and other items needed for successful accomplishment of this requirement. 

4. Comply with Information Technology Security and Privacy Requirements. Establish a 

contingency plan with either a backup site at a location acceptable to the FDIC, or other 

alternative contingency operations acceptable to the FDTC in the event of disruption in 

operation at the primary site. 

The TPA shall have the required web-based administration sy~tcms and call center 

operational by November 1, 2013 and shall conduct full testing before December 15, 2013. 

II. Background 

The .I<'ederal Deposit Insurance Corporation 

An Act of Congress in 1933 established the Federal Deposit Insurance Corporation (FDIC). 

As an independent Federal regulatory agency, the purpose of the FDIC is to protect 

depositors of all banks insured by the FDIC and to promote generally accepted banking 

principles throughout the hanking industry. 

FDIC is headquartered in Washington, DC. and has five Regional Offices in the following 

locations: Atlanta, Boston/New York, Chicago, Dallas/Memphis, Kansas City and San 

Francisco. Numerous field offices are dispersed throughout the Regional locations. 

About 2,500 of FDIC's current 7,700 employees are located in Washington. DC. Almost all 

FDIC employees are in professional positions involving finance, accounting, bank 

examination, and economics or administrative support positions. 

The FDIC receives no direct appropriations from Congress. Funding for FDIC operations is 

primarily derived from assessments collected from insured banks and interest earned on a 

portfolio of U.S. Treasury securities. 

FDIC has independent authority granted to some non-appropriated agencies by Congress to 

set pay and to offer benefit programs to employees that arc in addition to benefits generally 

available to Federal employees. FDIC-sponsored benefits include dental. vision, basic and 

supplemental lite, and long-term disability insurances, and health and dependent care flexible 

spending accounts under FDIC Choice: a domestic partner program, a parking flexible 

spending account program: a 40l(k) sayings plan; and a program that funds training 

expenses. There are approximately 3,500 retirees and surviving dependents who have 

continued FDIC-sponsored dental and approximately 3,200 who have continued FDICsponsored life insurance benefits. 

Federal-sponsored benefits available to FDIC employees include a myriad of health benefit 

plans of every type under the Federal Employees Health Benefits Program, the Federal 

Dental and Vision Program, the Federal Long Term Care Program, the Federal Employees 

Group Life Insurance Program, and the Federal Thrift Savings Plan. 

FDIC recogniLCS the representation of. and enters into good faith bargaining with, the 

National I'reasury Employees Union (NTEU). Pay and benefits arc among the issues that 

PAGE 81 OF 132 
CORHQ-13-C-0148 

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FDIC and NTEU negotiate on a regular basis. The existing FDIC-NTEU Compensation 

Ai;,>Tecment will be in place through December 31, 2013. liowever, if there is not an agreedupon successor agreement by that date, the provisions of the existing agreement will be in 

effect until such a successor agreement is in effect or until December 31, 2014, whichever 

comes first. Cu1Tent benefits as described in this document may be modified as a result of a 

ne\V agreement. 

The oubourcing services required for benefits administration shall cover all FDIC eligible 

active employees. retirees and surviving dependents, as applicable, nationwide. 

Flexible Cafeteria Benefits Program - FDIC Choice 

On January !, 2002, FDIC implemented "FDIC Choice," an Internal Revenue Code Section 

125 plan that includes the FDIC-sponsored benefits: dental, vision, life, and long-term 

disability insurances; and flexible spending accounts for health care and dependent care. 

Since FDJC is a governmental entity, FDIC benefits are not covered by provisions of the 

Employee Retirement .Income Security Act of 1974 (ERISA). Therefore, none of the 

associated ERlSA rights are applicable to the provisions of the "FDIC Choice" benefits 

plans. The terms of the plans may be changed at any time, subject to negotiation with, or 

notification of, the NTElJ, including re\'1sions to comply with changes or clarifications of 

applicahlc laws and regulations. 

The plans and probrrams of FDIC Choice arc administered through a TPA that offers 

customized web-based enrollment processes for elections by new employees, for annual open 

enrollment elections and for changes due to permitted life events throughout the Plan Year. 

The TPA also handles claims administration for the heaJth care and dependent care flexible 

spending accounts. 

A detailed summary of the plan and a description of the work required by the Contractor as a 

TPA and FSA Administrator for FDIC Choice benefits arc outlined in Sections Ill.A and 

JV .A of this document. 

FDIC Dental and FDIC Basic Life Insurance Plans for Retirees 

FDIC Choice benefits an: open to active employees only. All FDIC Choice benefits cease 

upon retirement. An employee who has been enrolled for five (5) consecutive years 

immediately preceding retirement, or has been enrolled for the full period for which eligible, 

may continue to be covered by FDIC Dental, Standard Option, and FDIC Basic Life 

Insurance in retirement. Detailed summaries of the plans and descriptions of the work 

required by the TPA relative to retiree benefits plan administration are outlined in Sections 

111.B and TV.B of this document . 

. FDIC Domestic Partner Program 

Effective January 1, 2009, the FDIC implemented a Domestic Partner Program for employees 

and retirees. The FDJC Domestic Partner Program ("DP Program•·) enables eligible active 

employees to cover their same sex or opposite sex domestic partners and/or the domestic 

partner's children for FDIC Dental, Vision, and Life Jnsurance Options 2 and 3, when the 

domestic partnership meets certain requirements. Eligible active employees may also receive 

the Health Insurance Premium Reimbursement (FITPR), which is a reimbursement to the 

PAGE 8? OF 132 
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Page 83 

employee for a portion of the premium cost of non-subsidized health insurance on the 

domestic partner and /or the domestic partner's eligible dependent children_ The TPA shall 

implement processes and procedures to reimburse the premium costs to eligible employees 

on a quarterly basis. 

Eligible retirees may cover a domestic partner and/or the domestic partner's eligible 

dependent children for FDIC Dental Standard benefits. The lill-'R Program is not applicable 

to retirees. 

Administration of domestic partner benefits includes enrollment, billing, and reimbursement 

processing. A description of the work required by the TPA for the Domestic Partner Program 

is outlined in Section Ul.C and Section IV.D, Appendices 6 and 7 of this document. 

FDIC Parking Flexible Spending Account Program 

Regmning January 1, 2011, the FDIC Parking Flexible Spending Account Proh,'TaITI ("Parking 

FSA'') \Vas ec.tablished for eligible employees to pay for parking at agency locations on a pretax basis. The FDIC Parking FSA Program is intended to qualify as a "qualified parking'' 

program \.\'ithin the meaning of section 132(() of the Internal Revenue Code. 

Employees located in offices where free parking 1s not offered by l-'DTC, and is not othen.vise 

available, or who arc not assigned parking in the immediate vicinity of their office and do not 

accept free parking in an alternative location, are eligible to participate in the FDlC Parking 

FSA Program. The Parking FSA Program allows eligible employees to have money 

deducted from biweekly pay on a pre-tax basis to cover qualified parking expenses, up to the 

maximum mnount specified by the Internal Revenue Service (IRS). 

A description of the work required by the TPA for the Parking FSA Program is outlined in 

Section IY.D, Appendix 8 of this document. 

FDIC Professional Learning Accounts Program 

FDIC's Corporate University is currently operating the Professional Leaming Accounts 

(PLA) Program and it is administered in the same online web-based environment as is 

utilized 10 administer the FDJC Choice Plan, with the capability of online completion of 

FDIC's Career Development Plan (CDP). 

The Pl .A Program consists of an allocation of time and money to pursue training and travel 

expenses if necessary. Each eligible employee has a PLA containing a specified annual 

amount of money and/or hours that is managed in partnership with the supervisor for use 

towards learning goals. A CDP is a personal development strategy that identifies an 

employee ·s career goals and/or developmental need:- along with a strategy for achieving them 

and must be completed and approved each calendar year in order to utili7e Pl ,A training and 

funding. An employee cannot request training until a CDP 1s approved by the supervisor. 

Through the secure training requisition and administration solution, the FD I C's employees, 

supervisors and administrators manage their respective online training request workflows 

relative to external training: (]) Requisitioning; (2) Business Rules: (3) Supervisors' 

approval/denial workflows; (4) Administrator expense payment tracking; (5) Employee, 

Supervisor, Administrator and Management reporting; (6) Online evaluation notice, 

PAGE 83 OF 132 
CORHO-13-C-0148 

Page 84 

completion and submission; (7) various administrative functions (Le. training cancellation 

processing, employee separation processing); and (8) Toll-free customer service. 

A description of the work required by the TPA for the PLA Program is outlined in Section 

TV.E, Appendix. 9 of this document. 

FDIC Benefits Hotline Call Center 

FDIC Benefits Specialists located in Headquarters Benefits Center (i.e., Washington, D.C.) 

have primary responsibility for providing centralized delivery of benefits mfonnation, 

counseling and educational services to employees, retirees, and surviving dependents 

nationwide. FDIC employees, retirees, and surviving dependents are located throughout the 

United States in over 75 locations outside of the Washinb'1on, D.C. metropolitan area. 

Service to be provided for inquiries. referrals and necessary assistance relate to both FDICsponsored benefits and Federally-sponsored benefits. 

The Benefits Center operates under a three-tier system of benefits delivery to provide fast, 

accurate, high-quality service to employees, retirees and surviving dependents. FDIC 

employees arc first expected to ·'self-service·' their benefits questions, using onlioe resources 

and telephonic sources for quick answers to questions and for updating personal information 

and benefits easily. The TPA 's Benefits Hotline Call Center staff shall act as a second level 

of service delivery in the three-tier system. Operation of these two tiers of service reduce the 

degree of resolution necessary by the FDIC Benefits Specialists, allowing them to focus 

primarily on the more detailed and difficult benefits delivery processc:- as the third tier. 

A description of the work required by the TPA's Benefits lfotline Call Center staff 1s 

outlined in Sections JV .F and Appendices l O and 11 of this document. 

Health Benefits Premium Reimbursement to Certain Retirees 

Two groups of retirees arc eligible for a reimbursement from the .FDTC to offset the cost of 

their group health insurance coverage under the Federal Employee Health Benefits (FEHB) 

Program: 

• 94-96 Buyout Retirees 

• Certain Re-employed Annuitants 

As part of huyout offers in J 994 through l 996, when FDIC provided health benefits 

Independently from the Federal Employees llcalth Benefits Probrram (FEHRP), retirees were 

advised that they would continue to pay the same premium for their health insurance 

coverage as active FDIC employees. When FDIC rejoined the FFHRP in 1997, where 

Federal annuitants pay a larger portion of the premium, FDIC devised a process to reimburse 

these "buyout retirees'' for the difference between the Federal annuitant health premium rate 

and the FDIC employee health premmm rate. The TPA shall implement processes and 

procedures to reimburse the additional FDlC premium contribution to the affected annuitants 

semi-annually on a prospective basis. 

FDIC reimburses only re-employed annuitants who are paying retiree rates for their FEHB 

premmms. FDIC active employees pay a lower rate for FEHB coverage than the "regular'' 

government rate hut when they become retirees the same rate applies as for all other 

PAGE: 84 OF 132 
CORHQ-13-C-0148 

Page 85 

government retirees. When retirees are re-employed as active FDIC employees, FDIC will 

reimburse the difference in the higher retiree rate to the active rate. The TPA shall 

implement processes and procedures to reimburse the additional FDlC premium contribution 

to the affected annuitants semi-annually on a retroactive basis. 

A description of the work required by the fp A to administer the reimbursement of FEHBP 

premiums is outlined in Section lV.G and Appendix 13, of this document. 

Contract Period of Performance and Option Periods 

The contract shall contain a "transition period" from August I, 2013 thru December 31. 

2013, in which there will he two contracts in operation. The five-month ·'transition period'" is 

necc~sary to coordinate the "start-up" processes if the contract is awarded to a new vendor. 

The existing contractor will continue to provide employee benefits administration services 

that include onlinc enrollment processes and a myriad of administrative support services. in 

addition to transferring and reconciling data necessary for '·start-up" in the event that the 

contract is awarded to a new vendor. 

The fully-operational Period of Performance for a three-year base contract shall commence 

on January 1, 2014 and end on December 31, 2016. The contract shall contain l\vo (2) oneyear Option Penods for possible extension by .FDIC until December 31, 2018. 

Ill. Plan Administration Summaries 

A. Flexible Cafeteria Benefits Program (FDIC Choice) 

Appendix I, Description of the FDIC Choice Plan, contains details about the FDJC 

Choice Plan provisions and options for each benefit program. The programs described 

therein arc the only programs that shall be administered as components of the FDlC 

Choice Plan. which is intended to qualify as a '·cafeteria plan'' within the meaning of 

Section l 25 of the lntcmal Revenue Code. FDIC-sponsored dental and life insurance 

plans for retirees arc not administered as components of FDIC Choice. Additionally, 

FDIC Choice does not offer any health insurance plan coverage. 

1. FDIC Choice Plan TPA Sen'ice Requirements 

Appendix 2, 'FDIC Choice Plan TPA Administrative Services Requirements, 

describes the administrative services that the TPA shall perform to administer the FDIC 

Choice Plan. The required administrative services primarily consist of plan enrollment 

and recordkeeping activities, electronic communications, with customer support for 

troubleshooting and corrective measures. The TPA shall develop electronic enrollment, 

customer support and recordkecping tools and systems that feed from CHRIS (the FDJC 

personnel records system) and to the FDIC payroll office of record (the National Finance 

Center) to the Dental and Vision lnsurance carriers, and to the Life Insurance carrier 

(only for Statement of Health/Evidence of Insurability completion purposes.) No 

individual employee enrollment data is transmitted to the I ,lfe Insurance and Long-Tenn 

I)isabil!ty Insurance carriers. 

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2. TPA Recordkeeping System Data Required 

Information in Appendix 3, TPA Recordkeeping System Data Required, comprises the 

employee, enrollment and contribution data that the TPA shall establish and maintain for 

the FDIC Choice Plan. The data identified will be provided to the TPA by the FDIC's 

Payroll System (the National Finance Center), by FDTC, and the current TPA based on 

existing records. The newly-av,'ardcd TPA shall develop the FDIC Choice Plan 

recordkeeping system to capture additional data on an ongorng basis. 

3. The National Finance Center - .FDIC's Payroll Office 

FDIC contracts for payroll services with the National Finance Center (NFC), which is 

located in New Orleans, Louisiana, and is the operational component of the United States 

Department of Agriculture's (USDA) Office of the Chief Financial Officer. The NFC 

perfonns administrative and financial services, including consolidated payroll, personnel, 

voucher and invoice payment., and systems support for approximately 120 Government 

agencies. 

NFC currently serves as FDJC's payroll accounting office and maintains employee data 

for administering compensation and benefits programs. NFC deducts from pay for the 

employee portion of premium costs. NFC partners with FDIC and the TPA to provide 

the required services to effectively administer the FDIC Choice Plan. Appendix 4, 

Information About the National .Finance Center (NFC) and S:ystem Requirements, 

describes the NFC and its role. 

B, fDIC Dental and FDIC Basic Life Insurance Plans for Retirees 

Employees may continue dental and life insurance coverage into retirement if they meet 

certain conditions. Currently, survivors of retirees enrolled in Dental Self & Family coverage 

may continue as long as the benefit is offered. A covered FDIC retiree who is re-employed 

may maintain the retiree coveragc(s) or choose to enroll for coverages offered as an active 

employee. 

Appendix 5, AdministratiYC Services Requirements for .Retiree Dental and Basic Life 

Insurance Plans, details the coverage provisions of the plans and the rccordkccping and 

reporting requirements to be performed by the TPA. Billing and Payment Services for 

Dental Plan arc detailed in Section 1V. Appendix 12. 

C. FDIC Domestic Partner Program 

An employee and the employee's domestic partner shall complete and submit a "Declaration 

of Domestic Partnership" form to certify that the domestic partnership meets all the 

required criteria to qualif)r for participation under the FDIC's Domestic Partner Program. 

Once approved to participate, the employee may enroll for eligible benefits through the 

electronic enrollment system, which will be pended for approval. Under Federal law, if a 

domestic partner and/or the domestic partner's eligible dependent children do not qualify as 

the employee's tax dependent for health coverage purposes, the portion of the employee 

premium for the domestic partnc(s/children·s FDIC Dental and/or Vision coverage must be 

paid on a post-tax basis. The value of such coverage is considered imputed income subject to 

taxation, less any post-tax premiums that the employee pays for that coverage. Appendix 6, 

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Page 87 

Administrative Sen'iees Requirements for the FDIC Domestic Partner Program, 

contains details about DP Program provisions and describes the application, approval, billing 

and premium payment processes for eligible employees and retirees to be performed by the 

TPA. 

A component of the DP Program is the FDlC Domestic Partner Health Insurance Premium 

Reimbursement (IITPR). Under this provision, eligible employees arc those who are enrolled 

in the Federal Employees Health Benefits Program and whose domestic partner and/or the 

children of the domestic partner are covered by non-subsidized health insurance. An eligible 

employee may be reimbursed for a portion of the premium:;. incurred and paid for the cost of 

such health insurance coverage. Health insurance is non-subsidized If the employee or the 

domestic pat1ner pays the full cost of the health msurance coverage for the domestic partner 

and/or the domestic partner's children; no third party, such as an employer or a government 

agency/program (e.g., Medicare/Medicaid). pays any portion of the premium: nor is the 

policy provided at below-market rates. lITPR is paid quarterly, after the employee completes 

an on line reimbursement request and submits proof of payment for the non-subsidiLed health 

insurance within the previous three months. The HIPR payment is taxable income that will 

be mcluded on an employee's W-2 and will be subject to Federal, state/local income taxes 

and employment taxes (FICA and Medicare). Appendix 7, details the eligibility 

dctennination_ application_ claims and reimbursement procedures and the Administrative 

Scn'ices Requirements for Health Insurance Reimbursement (HIPR). 

The FDIC Domestic Partner Prag.ram also provides benefits relative to the FDIC Relocation 

Travel Program and FDTC Business Travel Accident Insurance Program when the domestic 

partnership meets certain requirements. The TPA/contractor is not required to perform any 

services related to the travel programs. 

Employees arc encouraged to seek the guidance of a tax advisor if they are considering 

enrolling under the FDIC Domestic Partner Program. Unless the domestic partner or the 

domestic partner's children arc also tax-qualified dependents, they may not be enrolled in the 

FDIC sponsored FSAs or the Federal Employees f Jcalth Benefits Program. 

lf the employee dies in service_ FDIC Dental Insurance continues for the domestic partner 

and/or eligible children for a period ofup to two years. 

D. FDIC Parking Flexible Spending Account 

The enrollment, recordkecping and expense reimbursement requirements for the Parking 

FSA are conducted by the TPA in similar concept and operation to health care and dependent 

care flexible spending accounts for FDIC Choice. Appendix 8, Administrative Services 

Requirements for .FDIC Parking Flexible Spending Account, details the operations and 

administrative services that the TPA shall perform. 

E. FDIC Professional Learning Accounts (PLA) Program 

Appendix 9, Administrative Services Requirement,; for FDIC Professional Learning 

Accounts (PLA), describes the administrative services that the TPA shall perfonn to 

implement and maintain the PLA Program. 

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F. FDIC Benefits Hotline Call Center 

1. Service Delivery 

The TPA's Benefits Hotline staff shall act as the second level of service delivery in 

FDJCs three-tier system of benefits delivery. The TPA 's Benefits Hotline shall respond 

to basic questions about both FDlC-sponsored benefits and Federally-sponsored benefits 

from employees, retirees, surviving dependents and covered dependents. Also, the TPA's 

Benefits Hotline staff shall refer inquiries to and seek assistance from the Benefits Center 

staff as necessary. 

Appendix l O. Benefit.., Hotline Call Center Service Delivery, outlines the service to be 

delivered from the operation of the Benefits Hotline Call Center. 

2. Performance Requirements 

The TPA shall ensure the infonnation provided to inquirers is consistent and accurate. 

The Rene-fits Hotline shall be operated from Monday through Friday between the hours 

of 8:30 a.m. and 8:00 p.m., Eastern Time, excluding federal holidays. Appendix ! 1, 

Benefit.., Hotline Performance Requirements, outlines the specific performance 

standards applicable to the required services. 

G. Supplemental Administrative Services Required 

Utilizing retiree participation and surviving dependent data, the TPA shall provide billing and 

payment services in support of the FDIC Dental Plan for Retirees and coverage continuation 

for surviving dependents, as well as Health Benefits Premium Reimbursement to Certain 

Retirees. Survivors of employees enrolled in a Dental Self & Family enrollment may 

continue coverage for up to twenty-four months fo!lowing the employee's death. 

I. Billing and Payment Services FDIC Dental Plan 

FDIC retirees and surviving dependents of employees and retirees pay a portion of the 

premium for dental coverage. The billing and payment processes required arc outlined in 

Appendix 12. 

2. Health Benefit.., Premium Reimbursement to Certain Retirees 

FEJIB premmms are withheld from a retiree's annuity payment by the U.S. Office of 

Personnel Management. On a semi-annual basis, the FDIC reimburses certain retirees for 

the additional premium contribution, above the FDIC employee premium rate, withheld 

by l./ .S. OPM. The services outlined in Appendix 13 arc required to conduct the 

reimbursement payments. 

H. Infrastructure/Security Requirements 

Security requirements shall be satisfied by the TPA relative to the applications and systems 

employed for implementation and maintenance of the plans and programs outlined in this 

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Page 89 

document. The Security requirements shall be applied according to considerations necessary 

lo satisfy the Government Accounting Office (GAO) standards and FDIC. 

Electronic and mfonnation technology must conform to and be in compliance with the 

applicable provisions of the Architectural and Transportation Barriers Compliance Board's 

Electronic and Information Technology Accesslhllity Standards. 

The following measures will also apply: 

I. Integrity and .Fitness Background Investigations-Investigations shall he 

conducted for all contractor and subcontractor key personnel. 

2. Risk Level ]}esignation - The risk level assigned based on the requested services is 

MODERATE. 

3. Confidentiality Agreement - Contractor and personnel shall be required to execute 

a confidentiality agreement. 

4. lllP AA (Health Insurance Portability and Accountability Act) Business 

Associate Agreement - The contractor shall be required to execute a JITP AA 

busmess associate agreement with the FDIC that specifies applicable HlP AA privacy 

and security provisions to which the contractor and its systems must adhere. 

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IV. Appendices to Statement of Work 

A. Flexible Cafeteria Benefits Program - }'DIC Choice 

Appendix 1: Description of the FDIC Choice Plan 

Appendix 2: FDIC Choice Plan TPA Administrative Services Requirements 

Appendix 3: TPA Rccordkeeping System Data Required 

Append.ix 4: Jnfonnation about the National Finance Center (NFC) and 

System Requirements 

B. FD[C Dental and Basic Life Insurance Plans for Retirees 

Appendix 5: Administrative Services Requirements for Retiree Plans 

C. FDIC Domestic Partner Program 

Appendix 6: Administrative Services Requirements for DP Program 

Appendix 7: Administrative Services Requirements for Health Insurance 

Premium Reimbursement 

D. FDIC Parking Flexible Spending Account 

Appendix 8: Administrative Services Requirements for Parking Flexible 

Spending Account 

K FDIC Professional Learning Accounts 

Appendix 9: Administrative Services Requirements for PI ,A 

F. FDIC Benefits Hotline Call Center 

PAGE 90 OF 132 
CORHQ-13-C-0148 

Page 91 

Appendix 10: Benefits Hotline Service Delivery 

Appendix 11: Benefits Hotline Performance Requirements 

G. Supplemental Administrative Services Requirements 

Appendix 12: Billing and Payment Services for FDIC Dental Plan 

Appendix 13: Health Benefits Premium Reimbursement to Certain Retirees 

PAGE 91 OF 132 
CORHQ-13-C-0148 

Page 92 

Appendix 1 

Description of FDIC Choice Plan 

Health benefits coverage is not a plan option of the FDIC Choice Plan. Eligible FDIC 

employees and retirees may participate in the Federal Employees Health Benefits (FEHR) 

Program. which offers considerable nationv.ide plan choice. The TPA will not be required to 

develop online enrollment capability for enrollment and enrollment changes under the FEHB 

Program. 

The FDIC Choice Plan involves the use of employee elections (pre-tax except for some life 

msurance options) and credits. "Choice Credits" obtained from "waiving" or "opting out" of 

certain FDIC Choice coverages are paid to employees as taxable cash, which theoretically 

can be used to offset contributions required when enrolled for other plan benefits options. 

Dual enrollment is prohibited. Married/domestic partner enrollees may elect Dental and/or 

Vision Self-Only coverage for each enrollee or Self & family coverage per couple. With 

respect to the FDIC Life Insurance Plan. an enrollee who is married to or the domestic 

partner of another enrollee may not elect Option 2, Spouse/Domestic Partner Life Insurance, 

to cover the spouse or domestic partner. 

Survivors of employees enrolled in a Dental Self & Family enrollment may continue 

coverage for up to t\venty-four months following the employee's death. 

Due to a 12-day lag in the proces'.ing of payroll by NFC and to comply with the ms rule that 

a salary reduction for a benefit will occur in the same Plan Y car that the benefit is available, 

FDIC Choice benefits premiums have been compressed into 25 pay periods (starting with pay 

period 26 and ending with pay period 24). No premiums arc deducted from employee pay in 

pay period 25. 

Benefits coverage options in the FDIC Flexible l3enefits Cafeteria Program are as follows: 

1. FDIC Dental (An employee contribution is required for any coverage option elected.) 

a) Standard Option (lndcmnity Plan) 

b) High Option (Enhanced Plan) 

c) Low Option (Managed Care Plan) 

d) Waive Coverage and receive Chmce Credits 

2. FDIC Vision (An employee contribution is required for any coverage option elected.) 

a) Standard Option (Managed Care Plan) 

b) High Option (Enhanced Plan) 

c) Waive Coverage and receive Choice Credits 

A vision election applies for a two-year period. 

PAGE 92 OF 132 
CORHQ-13-C-0 148 

Page 93 

3. FDIC Life Insurance 

a) FDIC Non-Executive Basic Life (No employee contribution required unless also 

enrolled in the Federal Employees Group Life Insurance (FEGLI) Program.) 

b) FDIC Executive Level (grandfathered) and Executive Manager Basic Life (former 

Executive Level and current Executive Manager employees may select varying levels 

of Basic Life coverage wlth no employee contribution required unless also enrolled in 

the FEGLl Program.) 

c) Waive Basic Life Coverage and receive Choice Credits, unless also enrolled in 

FEGLl Program. 

d) FDIC Employee Life, Option 1 (Requires employee contribution) 

e) FDIC Spouse/Domestic Partner Life_ Option 2A and Option 2R (Requires employee 

contribution) 

f) FDIC Family Life, Option 3 (Requires employee contribution) 

g) Waive Option 1, 2 or 3 coverage with no receipt of Choice Credits 

Federal Group Life lnsurance (FEGLl) Program Coverage 

The FEGLJ Program is not an elective component of the FDIC Choice Plan. The FEGLl 

Program enrollment data will be maintained and compared with .FDIC Basic Lite 

Insurance coverage elections to detern1ine and coordinate appropnate FDIC employer 

contributions and employee deductions for FDIC Basic Life coverage or credits for 

opting out of FDIC Basic T .ife Insurance. 

Evidence ofJnsurability 

Certain life msurance elections require Medical Evidence oflnsurability approval before 

elected coverages become effective. 

4. FDIC Long~Term Disability Jnsurancc (LTD) 

a) Standard Option (No employee contribution required. Enrollment in this level of 

coverage is automatic and mandatory for all eligible pennanent employees. There is 

no ''lower-level" or "'waiver" provision available.) 

b) High Option (Requires employee contributions) 

5. FDIC .Flexible Spcndin~ Accounts (Requires employee contributions) 

a) Health Care Spending Account up to an annual maximum of $2,500 

b) Dependent Care Spending Account up to an annual maximum of $5,000 

IJealth Savings Account Enrollment 

The FEHR Program coverage is not an elective component of FDIC Choice. However, 

FEHR High-Deductible Health Plan with a Health Savings Account enrollment data will 

PAGE 93 OF 132 
Appt. Type 

Lxeeutive 

Car<:erl 

Permam.,"llt 

Temporary 

A.ppmntmcntof 

(ircater than One 

Year 

Temporary 

Appointment 

ofOne Year 

'J'cmpormy 

Appointment 

ofLcss than One 

Year 

Presidential 

Appointees 

CORHQ•13-C-0148 

Page 94 

he maintained and compared with Health Care 

there is no dual enrollment, per IRS regulations. 

Spending Account elections to ensure 

The following "Benefits Eligibility Chart .. delineates the FDIC benefits programs and the 

approximate number of employees that arc eltgible to be covered under each pro1,-.rram. Those 

programs that may be elected under the FDIC Choice Plan are shown under the ''Flexible 

Cafeteria Benefits Program" subheading. 

Benefits Eligibility Chart 

# ofEF,~ FDIC Choice - FJexible Cafeteria Benefits Program Federal Benefits 1 

9? 

,,,,.,,, 

'!')')') 

"' 

' 

1 

Dental Vi~im1 J,ong.-Tcrm l·DJC Jik FSA- FSA- FFGl.l (Group FEHR 

Insurance lnsmancc Disability ]n<;mance Dependent I lea Ith Care LikJ (Health) 

Prog.ram Progrnm Pmgram Prn!cJaru Care 

Yes Yes Ye, Yes Ye~ Yes Ye~ Ye, 

Ye; Yes Yes 'fr, Yes Yes Yes Yes 

Yes Yes Ne Ye, Yes Yes Yes Yes 

Ye, Yes Ne Ye, y~ Yes Ne No 

Ne Ne No Nc Yes Yes Ne No 

Yes Yes Yes Yes Yes Yes Ye; Ye~ 

1 FEGLI and FEHB enrollment data is required for proper administration of !'DIC Basic J .ifc Insurance and the Health 

care FSAs. 

: Student interns am! uuployces pursuing commissionm~ arc excluded. 

PAG[ 94 OF 132 

PLA2 

Yes 

----· -·--

Yes 

Yes 

Ye, 

Yes 

l\io 
CORHO-13-C-0148 

Page 95 

Appendix 2 

FDIC Choice Plan TPA Administrative Services Requirements 

A. Transition Period (August 1- December 31, 2013) 

Initial Transfer of Personal and Enrollment Data to New TPA 

NFC, FDIC and the current TPA will transfer existing personal and enrollment data into the 

new TPA 's recordkeeping system so that enrollment format and access can be developed for 

each employee in the various plans. The transfer shall be performed electronically according 

to a process agreed upon by al I parties. 

The required employee data to be provided to the TPA is shown in Appendix 3, "TPA 

Recordkeeping System Data .Required." 

FDIC shall verify all insurance premium rates and employee contribution amounts and 

credits v.'ith the TPA. 

Throughout the "transition period" the existing TPA will continue to perform enrollment, 

recordkeeping and administrative processes as contracted 

Enrollment System and Customer Scnicc Support Development 

The current contractor will conduct the enrollment and enrollment change elections process 

for the 2013 Open Enrollment. However, the newly awarded TPA/contractor will meet the 

systems development requirements as outlined. The TPA shall have the required web-based 

administration system operational by November 1, 2013 and shall conduct full testing before 

December 15, 2013, in order to be fully operational as of January 1, 2014. 

Prior to 2014 Contract Start 

With transferred data, the new TPA shall develop mechanisms to deliver enrollment and 

administrative services as follows: 

1. A secure web-enabled benefits enrollment and management system (PIN, password, 

etc.) with the following capability: 

a. Accessible 24 hours a day 

b. Apply plan provisions, business rules and processing controls 

c. Electronic library of reference materials and procedural documents 

d. Pending election application 

c. Test Site 

f. Three levels ofacecss and functionality (employee/retiree, administrator, and 

supervisor) 

g. A ·'quick loading version" for access via a laptop. 

PAGE 95 OF 13:, 
CORHQ-13-C-0148 

Page 96 

h. Summary pages - "Summary of Benefits'' and "FSA Balances and Claims" for 

example 

2. A Hotline Call Center ( with a toll-free telephone number with TDD; t·-mail; and web 

site functionality) 

3. Mass e-mail notification/Communications automation 

4. Electronic Document Collection and Archival 

5. Mailing Service 

6. Interface specifications for data import and export transmission between payroll 

administrator and insurance canicrs (including completion of Statement of Health 

form electronically.) 

The web-enabled enrollment system shall display individual screens of data records for all 

classes of employees. There must be a record of personal data. an election screen, and a 

summary of coverages with costs applicable to each individual. An alternative identifier 

must be created, assigned and distributed to each enrollee to use instead of the Social 

Security Number. 

The election application will show the options available and the required employee biweekly 

deductions or credits associated with each option. The TPA will produce the application 

using the employee data and tables of applicable employee biweekly contribution rates and 

credits. Algorithms will be used to calculate the applicable rate. For example; If Long Term 

Disability High option, then $ .xx multiplied by salary determines the contribution rate. 

The rates will be based on plan type for Long Tenn Disability. e.g. Standard $0, High option 

$ .XA times salary. For Dental and Vision, the rates and credits will be based on plan and 

dependent election type. For example; Dental Standard Self Only $.aa, Self & Family $.bb: 

High Option Self Only $ .cc, Self & Family $.dd; Low Option Self Only $.cc, Self & Family 

$.fT; and Waive/Opt-out ($.gg). 

For Optional Life Insurance, the rates \viii be based either on the amount elected multiplied 

by the applicable rate per$ I of coverage (converted from rate per $1,000) for the employee's 

age (determined from date of birth) or established as a percentage of salary. 

A team of selected testers will make enrollment elections to test the operations and 

functionality of the afore-outlined requirements of the newly-developed system, during the 

testing penod. 

Durinu _the 2011 Open Enrollme_!lt Period 

The election of coverages for the 2014 Plan Year will be conducted via the current TPA 's 

web site. Participants may change elections anytime during the Open Enrollment Period, up 

to 11 :59 p.m. on the last day. Because FDIC Bank Examiners have limited intranct access, 

the web site must provide a "quick loading" version. Employees failing to change 

enrollments will continue the current coverages for the plans except for the FSAs. IRS 

regulations require that employees make a new FSA election each Plan Year. 

PAGE 96 OF 132 
CORHQ 13-C-0148 

Page 97 

Prior to the start of the Open Enrollment Period, the TPA and FDIC will provide 

communica1ions and reference materials to employees (including those on leave-withoutpay) about enrollment system access and usage and their eligibility to elect benefits 

coverages. Information will be issued using several mediums including emails sent by the 

TPA and library of reference materials and procedural documents posted on the secured wcbenabkd online enrollment system. 

During the open enrollment process, the current TPA's Benefits Hotline Call Center staff will 

respond to inquiries concerning, but not limited to, the issues shm.vn below for all of the 

FDIC Choice benefits coverages (dental, \'ision, life insurance, LTD, and FSA), except where 

noted otherwise: 

1. Current plans to be elected and premium costs 

2. Enrollment assistance 

3. Dependents eligible for coverage 

4. Plan provisions, including covered ser,ices, eligible expenses, copayments, 

maximums, etc. 

The electronic enrollments made during the Open Enrollment Period will automatically be 

captured in the current TPA's recordkeeping system but not transmitted to the payroll office 

until an established time prior to January 1'1 of the 2014 Plan Year. A test of transmission 

and application accuracy shall be conducted prior to final transmission. Also, 1he electronic 

enrollments captured each week of the 2013 Open Enrollment Period will be transmitted to 

the new TPA/contractor to test to test the ability of the newly-developed system to accept, 

process, and reconcile new enrollment data. 

\Vhet:i. Open Enrollment End~ 

In accordance \vith previously identified specifications, the confirmed 2013 open enrollment 

elections shall be transmitted by the current TPA/contractor to the NFC and to msurance 

carriers for acceptance and reconciliation prior to the start of the new Plan Y car. 

The newly-awarded TPA and FDJC will provide communications and reference materials to 

employees to explain the transition and about new enrollment system access and usage. 

Information will be issued using several mediums including emails sent by the TPA with 

details about a library of reference materials and procedural documents posted on the TPA's 

and FDICs web pages. 

B. Ongoing Administration 

Rnrollment and Record Maintenance 

Throughout the Plan Year, the TPA shall maintain and update data items 1-3L designated in 

Appendix 3, "TPA Recordkeeping System Data Required," as applicable. The records may 

be for employees, retirees or surviving dependents. 

Classes of participants shall be established to ensure the varying eligibility and participation 

rules can be applied and specific benefits arc made accessible for election in the enrollment 

PAGE 97 OF 132 
CORHQ-13-C-0148 

Page 98 

system based on the rules. The system shall have the ability to transmit benefits elections 

throughout the Plan Year in a fonnat agreed upon with NFC and insurance carriers. 

The TPA enrollment system shall enable five types of changes and shall maintain a record of 

these changes in the online system. 

I. Separations may occur due to resignation, retirement, death or involuntary 

termination, v.'ith the concomitant cessation of pay and deductions. The TPA's 

system shall terminate benefits at the end of the pay period in which the separation 

occurs except in the case of dental and life insurance coverage for those employees 

who retire and meet certain conditions for continued coverage under these benefits. 

Retirees shall be transferred to the appropriate retiree class in the TPA 's database. 

2. The enrollment system shall have the capability to create a record and produce online 

enrollment for new and newl)''-cligiblc employees. New employees have 31 days 

from the date of hire to elect benefits. Those failing to enroll will have no FDIC 

Choice benefits coverage, except for automatic enrollment by the TPJ\'s system for 

Long-Tenn Disability Standard coverage, if eligible. 

3. Under IRC Section 125, a plan participant may not change a benefit election during 

the year, except due to the occurrence of certain life events. FDIC Choice's 

qualifying life events are called Permitted Election Changes (PECs). Employees 

who have a qualifying lifo event shall be pennitted to make dcsif:,'llated election 

changes within 60 days of the occurrence of the event that are consistent with the 

status change. For example. if an employee's spouse lost medical coverage, the 

employee would be allowed to increase the Health Care FSA election. The TPA shall 

program the PECs with applicable rules, as defined by FDlC, so that an employee can 

enroll only in benefits that are pennitted due to the specified life event. The TPA 

shall develop a sysiem to electronically capture and maintain the required 

documentation when presented by employees. 

4. During an annual open enrollment period, employees make elections that are 

dicctive for the next Plan Year. Benefits elections made during the open enrollment 

are irrevocable and remain in effect for a full Plan Year unless a "Pennittcd Election 

Change -- occurs. 

5. The TPA's system shall automatically make a class change for an employee based 

on specified personnel actions (e.g., promotion to an Executive Manager position 

from a Non-Executive position; conversion to a pennanent appointment from a 

temporary appointment of more than one year, etc.) and shall assign the correct 

benefits to the employee based on the new class. 

The online system must have the capability to effect separations, new employee enrollments 

and "life events" based elections throughout the Plan Y car, including enrollment and 

enrollment change data under the Domestic Partner Pro&rram. The annual open enrollment 

occurs during the fall of each year for approximately four weeks. With each type of record 

change, there must he the capability of adding or deleting dependents and issuing cards with 

alternate identifiers for dental and vision plan enrollees. 

PAGE' 98 OF 132 
CORHQ-13-C-G148 

Page 99 

Inquiries from employees concerning benefit issues shall be addressed by the plan carriers, 

FDIC Benefits Hotline Call Center and FDIC personnel/benefits start: as appropriate. To 

facilitate the process, the TPA shall provide weh links to plan carriers' assistance sites. The 

TPA shall have the capability to post communications and instructional materials prepared by 

FDIC on the TPA web site. These materials will be used by plan participants and benefits 

administrators to understand plan provisions. policies and procedures. 

Evidence of Insurability Processing 

Certain life insurance elections require Medical Evidence of lnsurahility (EOI) approv11l 

before coverages will become effective. When an employee enrolls or increases coverage 

that requires EOI approval, the TPA system must be programmed to pend the action, provide 

the employee with applicable instructions regarding application completion (including 

linking to an online SOH completion process) , monitor the insurance carriers approval 

system for status, and approve or decline the pended coverage in the enrollment system 

according 1o the carrier's determination. The TPA's online system automatically shall send 

an electronic notification to the employee regarding the disposition of the elected coverage. 

This process shall be active for all plan election situations. Linking to the insurance carrier's 

system requires connections of system-to-system encrypted authentication for the exchange 

of personal data and coordination of data records. 

Reports from TPA to Insurance Carriers 

The TPA shall send biweekly enrollment statistics to NFC, which compares that infonnation 

to its employment and pay records to determine enrollment and deduction discrepancies. The 

NFC sends an electronic report of discrepancies to the TPA for reconciliation with FDIC 

Benefits Center representatives. When reconciled, the TPA shall provide an electronic 

premium report to the Dental and Vision insurance carriers. No reports are sent to the Life or 

Long-Tenn Disability insurance carriers. 

The mitial report transmitted to the Dental and Vision insurance carriers will contain data for 

all employees. Thereafter, the report will provide updated data for all employees reflecting 

biweekly changes as well as the specified changes for all employees added (hired). or 

subtracted (terminated), and the changes for those employees making "status changes.'· 

The initial report for the Dental and Vision insurance carriers must contain: 

1. Name 

2. Social Security Number 

3. Personnel Office Indicator (POT) 

4. Benefits Eligibility (Yes/No) 

5. Full Time/ Part Time (hours biweekly) 

6. Length and Type of Appointment 

7. Status (Active, Separated, Retired) 

8. Date of llirth 

9. Insurance premium rate for applicable Dental and/or Vision Option 

PAGE 99 OF 132 
CORHQ-13-C-0148 

Page 100 

10. Dental and/or Vision Plan Code (e.g., Standard Option) and Coverage J ,eve] 

Code (e.g., Self & Family) 

11. Dependent Data, to include: 

a) Name 

b) Relationship to Employee (Spouse, Domestic Partner, Child) 

c) Gender 

d) Date of Birth 

e) Social Security Number 

f) Full Time Student (Yes/No) 

g) Over Age Dependent (Yes/No) 

The type of enrollment information and the format for TPA reporting will be dete1mined in 

consultation with each carrier. 

Reports to .FDIC 

Copies ofTPA reports sent to insurers shall be available to FDIC Benefits Center personnel, 

either by direct inter/intranct access or by transmission of a secure electronic file transfer. 

The TPA shall provide the FDIC with biweekly reports of enrollment statistics on all 

insurance henefits for ·'self-billing'" purposes. 

Each report shall show the total premium owed for that biweekly period. 

• For the Dental, Vision and Long-Term Disability reports, premiums will be 

calculated by an algorithm that totals the number of employees in each rate group 

(e.g. Dental Standard Option, Self Only), multiplied by the premium rate for the rate 

group .. The subtotals for the rate groups arc then totaled. 

• For the Life Insurance report: 

• 

• 

• 

Basic Life Insurance, the total msurance volume, expressed in $1,000 of 

coverage, is multiplied by the premium rate. 

For Option 1 and Option 2, total volume, expressed in $1,000 of coverage for 

each age band, e.g. age 30-35. is multiplied by the premium rate, and then the 

subtotals for all age bands are totaled. 

For Option 3, each enrolhncnt in an age band ~hall be multiplied by the premium 

rate and then the subtotals for all age bands arc totaled. 

The TPA will maintain Dental and Life insurance enrollment data for retirees and their 

dependents (dental only). Dental enrollment data for surviving dependents will also be 

maintained. The TPA Dental and Life insurance enrollment reports to FDIC shall contain 

separate data on retiree premium costs. 

PAGE 1D0 OF- 132 
Page 101 

FDIC: may request that the TPA produce other standard or customiz.cd reports. 

Flexible Spending Accounts (FSA) Administration 

The TPA will conduct all FSA administration including, but not limited to: 

Maintaining records of employee elections and expected biweekly contributions 

2.. Claims adjudication 

3. Establishing the funding process v.,ith FDIC Division of Finance 

4. Quarterly electronic notices to employees to review account activity history and other 

communications as deemed necessary 

5. Reports to FDTC Benefits Center and Division of Finance 

6. Establishment and adherence to the lllPAA Business Associate Agreement and 

issuance of HIP AA Privacy Notice 

Nondiscrimination Testing Data 

The TPA will conduct a full range of discrimination tests and produce a report showing FDIC 

Choice Plan employer and employee contribution costs separately for "'highly compensated" 

and for "non-highly" compensated employees (collectively and by bargaining unit). 

PAGE 101 OF 132 
CORHQ 13-C-0148 

Page 102 

Appendix 3 

TPA Recordkccping System Data Required 

Initial Employee Data Required in Customized Enrollment Record (From NFC, FDIC 

and/or current TPA) 

1. Social Security Number 

2. First Name 

3. Middle Initial 

4. Last Name 

5. Street Address 

6. P.O. Box/Apartment Number 

7. City 

8. State 

9. Zip Code 

10. Telephone Number 

11 . Preferred Email Address 

12. Date of 13irtb 

13. Date of Hire 

14. Status (Active, Separated, Retired) 

15 Full Time/ Part Time (hours biweekly) 

16. Employee Class/Type of Appointment 

17. Personnel Office Identifier (POl)/FDIC Office 

18. Base (Scheduled) Salary 

19. Adjusted Basic Pay 

20. Jnfonnation on Covered Dependents 

• 

• 

• 

• 

• 

• 

• 

Name 

Relationship to Employee (Spouse, Domestic Partner, Child) 

Date of Birth 

Social Security Number 

Full Time Student (Yes/No) 

Incapable of Self Support (Yes/No) 

Over Age Dependent (Yes/No) 

21. Dental Plan Coverage Election 

22. Vision Plan Coverage Election 

PAGE 102 OF 132 
CORHQ-13-C-0148 

7' --'· 

24. 

25. 

26. 

27. 

28. 

29. 

30. 

31. 

Page 103 

Basic Life Insurance Coverage Election (FDIC, FEGLI or Waived) 

FDIC Optional Employee Life Insurance Coverage Election/Salary Multiple 

FDIC Spouse/Domestic Partner I .ife Insurance Coverage Election 

H)JC Family Life Insurance Coverage Election 

Health Care Flexible Spending Account (FSA) Election/ Annual Dollar Amount 

Dependent Care FSA Election/ Annual Dollar Amount 

Health Care FSA Activity/Balance 

Dependent Care FSA Activity/Balance 

Pending Coverage Elections (Requiring documentation or EOI approval) 

Employee Data Maintained by TPA for Ongoing Recordkeeping (In addition to items 1 

through 31 abo,·e.) 

32. Elections made during the 2013 Open Enrollment Period 

33. ITistory of Plan Elections and Changes that can be reported individually (Options and 

levels of coverage since 2002) 

34. History of FSA Administration for past Plan Year 

35. Plan Enrollment Data Imports and Exports 

36. Salary History 

Data Elements Needed in Recordkceping System (Generated from look-up tables) 

ltems 1 through 31 above. lo order to accommodate transmission to payroll pro,·ider, 

items 37-43 will each require an employer data clement. 

3 7. Dental Biweekly Contribution (Pre-tax) or Choice Credits cash payment 

38. Vision Biweekly Contribution (Pre-tax) or Choice Credits cash payment 

39. FDIC Basic Lite Insurance Waiver with Choice Credits cash payment 

40. FDIC Optional Employee Life, Spouse Life and Family Life Biweekly Contribution 

(Post-tax) 

41. Long Term Disability Biweekly Contribution (Pre-tax) 

42. Health Care FSA Biweekly Contribution (Pre-tax) 

43. Dependent Care FSA Biweekly Contribution (Pre-tax) 

Premium and Cost Data Needed in TPA Recordkeeping System 

The following is an explanation of the benefit plan premium cost information required to be 

housed in the recordkeeping system in a "Look-Up Table." The appropriate rates, employer 

contributions, employee deductions, and credits shall then he assigned to each employee 

record by use of algorithms. 

PAGE 103 OF 132 
CORHQ-13-C-D148 

Page 104 PAGE' 1D4 OF 13? 

---· Plan Coverage Option Rate Employee Deduction* Employer Contribution* ------- FDIC Basic Life Insurance Rate $0 or Premium Rate if Premium Rate or $0 if 

EE has FEGLI EE has FEGIJ -- ·- --- ... .. ---·-

FDIC Basic Waiver Credit if EE does not $0 

have FEGLl . ----·- . 

FDIC Optional Employee Life Age Band Rates Same as Premium Rate $0 

(Currently 10 age bands at five year intervals 

from age 35 to 75 plus below 35 and above 75) - .FDIC Spouse/Domestic Partner Life Age Band Same as Premium Rate $0 

Rates (Currently two options with l O age band 

rates each) . --- FDIC Family Lite Insurance Age Band Rates Same as Premium Rate $0 

(Currently one option with 10 age band raks 

each) ·---

Long Term Disability Jligh Option Rate Deduction Amount Standard Option 

Contribution Amount . 

Long Tenn Disability Standard Option Rate $0 Standard Option 

Contribution Amount -· 

Dental Standard Option Self Only Rate Deduction Amount Contribution Amount . . -··· 

Dental Standard Option Self & Family Rate Deduction Amount Contribution Amount ------

Dental High Option Self Only Rate Deduction Amount Standard Self Only 

Contribution Amount 

Denta! JJigh Option Self & Family Rate Deduction Amount Standard Self & Family 

Contribution Amount ----· ·---- Dental l ,ow Option Self Only Rate Deduction Amount Contribution Amount .. ---··--

Dental Low Option Self & Family Rate Deduction Amount Contribution Amount i--------··-- .. -··-

Dental Waiver Credit $0 . 

Vision Standard Option Self Only Rate Deduction Amount Contribution Amount ---- Vision Standard Option Self & Family Rate Deduction Amount Contribution Amount . 

Vision High Option Self Only Rate Deduction Amount Standard Self Only 

Contribution Amount -··- --- ··-·---···-

Vision High Option Self & Family Rate Deduction Amount Standard Self& Family 

Contribution Amount ---- -· 

Vision Vlaiver Credit $0 

* Actual amounts for premmm rates. employee deducttom, and employer contnbut10ns will 

be provided to the TPA by FDlC. 
CORHQ-13-C-0148 

Page 105 

In addition, the table will contain the separate maximum coverage amounts and the separate 

guaranteed Issue amounts for each life insurance coverage. 

The TPA will provide biweekly reports to FDIC Benefits Plan Oversight Managers showing 

enrollment and coverage selection statistics, by enrollee, for each plan, based on applicable 

deduction and rate information_ NFC will deduct the premiums from employee pay and send 

the employee deductions and the employer contributions to a specified account at the FDJC's 

Division of Finance_ by way of electronic funds transfer (EFT), biweekly_ The FDIC will 

transfer the appropriate funds to each plan carrier based on the TPA reports. 

PAGF 10:J OF 132 
CORHQ-13-C--0148 

Page 106 

Appendix 4 

lnfonnation about the National Finance Center (NFC) and System 

Requirements 

FDIC currently purchases the services of the National Finance Center (NFC) to administer its 

payroll activities_ including enrollment and deduction recordkeeping for FDIC benefits 

protc,rrams. The TPA will be the main data recordkeeper relative to enrollment in the FDJC 

dentaL vision, life, and long-term disability insurance protc,rrarns, and flexible spending 

accounts. The TPA will supply data to NFC in the format specified by NFC and FDIC. 

NFC Systems 

NFC utilizes the following systems to deliver its services: 

The Payrol1'Pcrsonnel System incorporates a fully integrated onlinc data base which 

maintains employee personnel records and time and attendance reports and processes a 

biweekly payroll for over 450,000 employees. 

The Administrative Payments Systems transfer funds between Government agencies and 

process payments to commercial vendors mcorporating all features of the Prompt Payment 

Acl. 

The Accounts Receivable Systems process billings and collections for customers' 

administrative and program functions in compliance with the Debt Collection Act. 

The Property Management Systems integrate fiscal accounting with property accountability 

and provide data to manage and control capitalized, leased, loaned, excess_ expendable, and 

sensitive property. 

The Thrift Savings Plan System handles recordkeeping for the 40 l(k)-type retirement plan in 

accordance with the Federal Employee's Retirement System Act. 

All application systems arc integrated with the Accounting System that maintains the general 

ledger and produces all necessary reports to satis1)' the U.S. Department of Treasury, Office 

of Management and lludget, the General Accounting Office, and unique customer 

requirements. 

Hardware and Software Resources 

Following are NFC's hardware and software resources: 

llardware 

Processors 

Operating System 

lBM CMOS ES-9672R 

R56, R36. R45. R25 

MYS - OS/390 V. 2.6 

PAGE 106 OF 132 
CORH0·13-G-0148 

Primary Storage 

Transmission Types* 

Page 107 

DASO 3390-3 

TAPE 3490 

Mainframe to Mainframe 

Firewall to Firewall 

TCP/IP 

RJE Remote Job Entry 

3780 Bisync 

Connect/Direct 

* May require more detailed specifications from Telecommunications Personnel. This is a 

broad list of telecommunication options that NFC offers. 

Functional Requirements for Flexible Cafeteria Benefits Program 

Implementation and Maintenance 

Utilizing existing systems and equipment, the NFC will partner with FDIC to provide the 

following services in support of a new TPA 's implementation and maintenance of the FDIC 

Choice Plan. 

NFC Provides Emplo:ree Data to TPA 

NFC will electronically provide detailed employee data to a new FDIC Choice TPA. The 

TPA will receive as much of the information outlined in Appendix 3, "TPA Recordkeeping 

System Data Required," of this document as is available in NFC sy:;,tcms. fhe remainder of 

information needed will come from FDIC and the existing TPA. 

NFC will also develop layouts for transfer of files_ including employee data, benefit amounts 

and rate tables. 

Development of Jnitial Enrollment Records 

TPA will work with NFC to establish codes, data fields, and/or program modifications, based 

on each benefit plan's design, to accommodate data transferred from the TPA into the NFC 

Payroll System by the most efficient method of electronic transfer. 

TPA Transmission of Enrollment Data to NFC 

NFC will work v,rith the TPA to establish the most efficient method of electronic transfer of 

employee enrollment data from the TPA to NFC. 

Applving Open Enrollment Records 

The current contractorfrPA will be responsihle for conducting the 2013 Open Enrollment 

Period for employees to elect 2014 Plan Year coverages. Employees will make elections 

online and the enrollments will be automatically applied in the TPA's system. At the end of 

the Open Enrollment Period, the TPA shall prepare an electronic file of the enrollment 

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choices made by eligible employees, based on plan choices described in Appendix 1, 

'·Description of FDIC Choice Plan" of this document. The file will include data elements as 

established by NFC and the TPA. 

The newly-awarded TPA will provide a customiLed enrollment system developed from 

existing employee data initially provided by NFC. FDIC and the existing TPA and will first 

process open enrollment elections as described for the 2014 Open Enrollment Period. The 

TPA will submit enrollment data to NFC to conduct a test of data transmission and 

application accuracy. 

Ongoing Maintenance of Records 

Starting with the 2014 Plan Year and throughout subsequent plan years, the newly-awarded 

TPA will provide NFC with daily benefit record changes as a result of personnel separation 

actions received from NFC (i.e .. death, resignation, retirement, removal), new employee 

elections and mid-year elections based on experiencing a Permitted Election Change. NFC 

,viii incorporate these changes into their system and conduct the reconciliation processes as 

noted previously. 

NFC Provides Contributions to FDJC for Payment to Plan Carriers/Insurers 

Based on enrollment data provided to NFC by the TPA, NFC will apply the appropriate 

employee deduction and employer contribution amount to the record from a ·'Jook-up" table 

prepared from account information provided by FDIC. NFC will send the employee 

deductions and the employer contributions for each of the benefits plans to a specified 

account at the FDIC by way of electronic funds transfer (EFT), biweekly. The FDIC will 

transfer the appropriate funds to each plan carrier. 

Earnings and Leave Statement 

NFC will issue the Earnings and Leave Statement sbo\ving line items for deductions/credits 

for dental (pre-tax), vision (pre-tax), employee life (post-tax), dependent life (post-tax), LTD 

(pre-tax). FSA accounts (pre-tax), and "Choice Credits" (taxable ordinary income). 

Form W-2 Reporting 

NFC will maintain cumulative tax-year amounts of deductions (pre-tax and post-tax) and 

credits and appropriately apply to W-2 form preparation. 

Reports 

Some reports will be provided by NFC to FDIC. These will be determined by FDIC in 

consultation with the NFC, and will likely include most or all of the currently provided 

reports. The TPA will provide most reports to FDIC, including reports to insurers/plan 

earners. 

These are not absolute requirement specifications. Through the collaborative efforts of the 

TPA. NFC, FDIC and consultants, the detailed requirement specifications will be finalized. 

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Appendix 5 

Administrative Services Required for Retiree Plans 

The initial transfer of existing personal and enrollment data for retirees will be from FDIC 

and the current TPA into the new TPA ·s recordkeeping system so that enrollment format and 

access can be developed for each retiree or survi\·ing dependent (dental) in the various plans. 

This shall he performed electronically according to a process agreed upon by all parties. 

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Appendix 6 

Administrative Services Requirements for DP Program 

\1/hen eligible, employees may cover a domestic partner and/or the domestic partner's 

eligible dependent children under the followmg FDIC benefits: 

• FDIC Dental Insurance 

• FDlC Vision Insurance 

• FDlC Dependent Life (nsurance (FDIC Option 2, Spouse/Domestic Partner 

Life insurance_ and FDIC Option 3, Family Life Insurance 

• Health Insurance Premium Reimbursement -- a reimbursement to the 

employee for a portion of the premium cost for non-subsidized health 

insurance on the domestic partner and/or the domestic partner's eligible 

dependent children. 

Eligible retirees may cover a domestic partner and/or the domestic partner's eligible 

dependent children for Dental Standard benefits under the FDIC Dental Insurance for 

Retirees Plan. The Health Insurance Premium Reimbursement (IITPR) Program is not 

applicable to retirees. 

The employee and the employee's domestic partner shall complete and submit a '•Declaration 

of Domestic Partnership" certifying that the domestic partnership meets all of the 

eligibility criteria in order to establish a domestic partnership and to participate under the 

FDIC's Domestic Partner Program. The Declaration shall be submitted once at any time 

on or after the date the domestic partnership meets all of the qualifying conditions. 

When an employee identifies a domestic partner and/or children of a domestic partner as 

dependents and seeks benefits coverage, a Declaration of Domestic Partnership form will be 

electronically sent to the employee via the enrollment system and must be completed and 

returned to the TPA ,vithin 10 days of the issuance. Once approved for participation, the 

employee may enroll for benefits. lf the employee enrolls a domestic partner and the 

domeslic partner's eligible dependent children for coverage under the FDIC Dental and/or 

Vision Plan: 

• FDIC will pay the amount of agency contribution for Self& Family coverage 

applicable to the selected Option. 

• The employee shall continue to pay the portion of the employee premium for 

coverage for him or herself on a pre-tax basis biweekly (and, if the employee has 

enrolled his or her eligible dependent children, for their coverage on a pre-tax basis 

biweekly). The remaining portion of the employee premium, if any, to provide the 

coverage for the domestic partner and/or any eligible dependent children of the 

domestic partner shall be paid on a post-tax basi~. FDIC shall bill the employee 

annually for post-tax dental and/or vision premiums for this coverage. 

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• The value of the group dental and/or vision coverage for the domestic partner and/or 

the domestic partner's eligible dependent children, less the post-ta.x premmms paid 

by the employee for that coverage_ shall be treated as imputed income and included 

on the employee's W-2 fonn. 

• FDIC shall bill the employee annually for the FICA and/or Medicare taxes owed on 

the imputed income of the dental and/or vision coverage for the domestic partner 

and/or the domestic partner's eligible dependent children at the same time as the posttax annual premiums are billed. 

• If an employee is eligible to continue FDIC Dental Insurance in retirement, coverage 

for the domestic partner and/or the domestic partner's eligible dependent children 

included under the employee's enrollment shall also continue. The retiree shall be 

hilled quarterly on a post-tax basis for the Self & Family coverage but may ekct to 

pay as many quarters m the Plan Year in advance as desired. 

• The imputed income of the group coverage under the retiree's dental enrollment for 

the domestic partner's and/or the domestic partner's eligible dependent children's 

coverage shall be treated as imputed income and included on a 1099-Mise fonn that 

the FDIC shall send to the retiree after the end of the Tax Year. 

• With respect to FDIC dependent life insurance, the same requirements, coverage and 

limitations that apply to the enrollment of an employee':;. spouse and eligible 

dependent children shall apply to enrollment of a domestic partner and a domestic 

partner's eligible dependent children. 

The web-enabled enrollment and recordkeeping system must have the capacity to meet the 

administrative service requirements to maintain data and administer the DP Program for the 

following: 

• Online approval of domestic partnership and related dependents 

• Capture special benefit level and pricing option rules and recordkccping requirements 

• Track partner/partner dependent enrollments and apply corresponding special DP 

premium arrangements and offsets 

• Communications automation -- electronically generate and send forms, notifications, 

etc., to employees 

• Document collection and retention capabilities -- processes for receiving_ scanning 

and reviewing documentation reqmred to certify eligibility 

• Develop imputed income calculations and reports 

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• Provide system application to present DP benefit levels and pricing options to various 

data interchange programs, particularly the NFC and plan carriers, in established 

specific data formats 

• Provide premium data to FDIC Benefits Center and Division ofFinanec that will be 

used to update participant's NFC payroll records for reimbursement of offsets 

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Appendix 7 

Administrative Services Requirements for Health Insurance Premium 

Reimbursement 

To be eligible for the Health Insurance Premium Reimbursement (TTIPR), the FDIC 

employee must be enrolled in a plan under the Federal Employees' Health Benefits (FEI-113) 

Program and the domestic partner and/or the domestic partner's eligible children, if any, must 

be enrolled in and paying for a non-subsidized health insurance plan and cannot be enrolled 

under any type of subsidized health insurance plan including a government plan (e.g., 

Medicare or Medicaid). 

• The IJJPR shall be equal to the lesser of: 

• Eight_y-fi.vc percent (85%) of the cost actually paid on a monthly basis for health 

benefits coverage for the domestic partner·s Self-Only or Self & Family nonsubsidized health insurance plan, or 

• The maximum FDlC monthly contribution for any FEl:lB insurance option for a SelfOnly or Self & Family policy, as applicable, for the Plan Year. 

• The percentage that is used to calculate the HIPR payment shall change by the same 

amount as any future .FDJC FETIB subsidy percentage change. 

• 1-HPR payments shall occur quarterly. Reimbursements will occur four times a year. 

The first reimbursement shall apply to the health insurance premiums paid for 

January through March; the second shall apply to premiums paid for April through 

June; the third shall apply to premiums paid for July through September; the fourth 

shall apply to premiums paid for October through December. 

• Employees will be sent an electronic notice at the end of each quarterly 

reimbursement period providing claims instructions, requesting documentation of 

valid payments made, certification of enrollment under the _FE(IB Program as the 

subscriber and that DP dependents arc covered by a non-subsidized health insurance 

plan. 

• Employees must submit proof of coverage and payment of non-subsidized health 

insurance premiums when they initially apply for reimbursement and whenever there 

is a change in the health carrier and/or premiums. Employees may self-certify 

\Vithout submitting additional documentation for a quarterly period if the health 

carrier and premiums have not changed fi-om the submission approved for the prior 

reimbursement period. 

• A copy of the health insurance premium statement/invoice(s) and paid receipts for the 

number of months, or portions thereof, that premiums were paid during the quarterly 

reimbursement period must be provided (scanned and uploaded into the online 

module, or faxed or mailed to the TPA). The premium statement/invoice must 

indicate the name of the insurance provider, the type of coverage (e.g. single/family 

plan), the coverage period, and the name of the covered pcrson(s). 

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• The 1JIPR Request must be completed and required documentation must be received 

no later than April 15 for the first quarterly period (Jan-March); July 15 for the 

second quarterly period (April - June); October 15 for the third quarterly period (July 

- September); January 15 for the fourth quarterly period (October - December). lf the 

15th falls on a Saturday, Sunday or holiday. the HIPR Request must be submitted by 

the next business day. 

• Reimbursement will be prorated based on full pay periods if the employee was 

enrolled in the Domestic Partner Program for less than the full three-month 

reimbursement period. 

• The FDIC shall reimburse the employee quarterly for expenses incurred. Retroactive 

reimbursements for prior quarterly periods shall not be processed or paid by the 

FDIC. 

The employee or domestic partner must first pay for the health insurance coverage in order 

for the employee to be reimbursed under the JHPR Program. The web-enabled enrollment 

and recordkccping system must have the capacity to meet the administrative service 

requirements to maintain data and administer the HIPR portion of the DP Program as 

follows: 

• Provide an online application to support requisition. recordkeeping. documentation 

management and authorization for employees requesting health insurance premium 

reimbursements 

• Document collection and retention capabilities -- processes for receiving, scanmng 

and reviewing documentation required to certify eligibility (health insurance 

premium statement/invoicc(s) and paid receipts for premiums paid the period claimed 

for re1mburscmcnt which indicate the name of the insurance provider, the type of 

coverage (e.g. single/family plan), the coverage period, and the name of the covered 

person(s). 

• Electronically manage quarterly deadlines for claims submission 

• Calculate reimbursement amounts before taxes and provide to FDIC for verification 

and coordination with the NFC for appropriate withholdings and payment 

• Communications automation -- elcctromcally generate and send forms, notifications, 

etc., to employees 

lllPR benefits terminate on the earliest of: 

• The last day of the cmployee·s FDIC employment whether by retirement or 

separation, 

• The last day of the pay period in which the employee ceases to be eligible for 

domestic partner benefits, 

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• The last day of the pay period in which the employee ceases to be eligible for lllPR 

benefits (e_g., due to dis-enrolling from FEl-lB or the domestic partner/children 

become covered by a subsidiLcd health insurance plan), 

• The last day of the pay period before the employee enters a position excluded from 

FEHil coverage, 

• The last day of the pay period in which the FDIC terminates HIPR benefits, 

• The last day of the pay period that includes the 365th day of continuous leave without 

pay (or the last day of the pay period that includes the 7301h day of continuous leave 

without pay incurred due to serving on active military duty in a contingency 

operation (as defined under 10 USC sec. 101(a)(l3)), or 

• The last day of the pay period in which the employee fails to comply with the 

requirements ofthe 1-IIPR Program. 

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Appendix 8 

Administrative Services Requirements for Parking Flexible Spending Account 

Only employees located in offices where FDIC docs not offer free parking, and where 

free parking is not otherwise available in the immediate vicinity of their office, are 

eligible to participate in the FDIC Parking FSA. An employee located in an office where 

free parking is assigned and accepted is not eligible to enroll in the Parking FSA. An 

employee who currently utilizes transit subsidy benefits also is not eligible to enroll in the 

Parking FSA. 

An employee located in an office where free parking is assit,rncd and accepted is not eligible 

to enroll in the Parking FSA. An employee who utilizes transit subsidy benefits also is not 

eligible to enroll in the Parking FSA. As employees incur qualified expenses, they may 

submit a claim for reimbursement from funds that have accumulated in their Parking FSA. 

"Qualified parking expenses" arc the costs that an eligible employee incurs for parking on or 

near the premises of an FDIC agency office relative to the daily commute to work. Costs for 

parking in a lot or garage near a location from which an employee commutes to work using 

mass transit (publicly or pnvately operated bus, rail, or ferry), commuter highway vehicles, 

or carpools are not qualified parking expenses and may not be funded under the FDJC 

Parking FSA. 

A new employee or an existing employee, who becomes newly eligible to enroll m the 

Parking FSA Program, may make an enrollment election and designate the amount to be 

deducted from pay to fund reimbursement of qualified parking expem,es at any time after 

meeting the eligibility requirements. All new enrollments will pend and an electronic 

notification will be sent to the applicant employee acknowledging the election and to the 

FDlC Parking Administrator requesting a determination of the employee's eligibility to 

participate. Such enrollment becomes effective on the first day of the first full pay period 

after approval by the FDIC Parking Administrntor. 

A participant is permitted to change an election, relative to future periods of coverage, at any 

time after the initial enrollment: and is not subject to Open Enrollment or Permitted Election 

Change restrictions. An election change becomes effective on the first day of the first full 

pay period after the enrollee makes the change. 

Enrollees may elect an annual amount, up to a maximum ofhvelve times the IRS monthly 

maximum, to be deducted from pay for the full plan year. The total amount elected will be 

deducted from pay on a pre-tax basis over the lesser of the number of full pay periods 

remaining following the enrollee's election effective date or 25 pay periods, !ffor a full plan 

year. Deductions begin with the earlier of the first full pay period following the enrollee's 

election effective date, or if the election 1s effective January 1, with pay period 26 of the 

preceding year and ending with pay period 24 of the applicable plan year. An election will 

remain in effect until the participant elects to change such election, becomes ineligible to 

participate. ceases to be an FDJC employee, or the FDJC terminates the Parking FSA 

program. 

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As soon as deductions are placed into the Parking FSA, a participant may begin to request 

reimbursement for qualified parking expenses. Participants may submit claims daily and be 

reimbursed weekly from accumulated contributions. Claims must be for parking expenses 

incurred on or after the effective date of an election and salary reduction agreement and while 

enrolled in the Parking FSA. Parking FSA claims reimbursements will be paid only through 

Direct Deposit for a minimum of $25. No checks will be issued. Contribution amounts 

remaining at the end of a plan year are not forfeited, hut are rolled over and cumulative. 

The amount available for reimbursement will not at any time exceed a participant's total 

account balance. A reimbursement payment shall be limited to the per-month IRS 

established ma"\.irnum. If an employee's reimbursement request is for less than the existing 

contribution balance, the unused amounts in the FSA will rollover and be available for future 

reimbursement. Employees may request reimbursement for expenses up to one year from the 

date the expense is incurred. 

Parking FSA benefits shall terminate on the earliest of: 

• the last day of the pay period in which the enrollee ceases to be an "eligible 

employee" for Parking FSA, 

• the last day of the enrollee's FDIC employment. or 

• the termination of the Parking FSA Program. 

The enrollment, recordkeepmg and expense reimbursement requirements for the Parking 

FSA arc conducted by the TPA in similar concept and operation to health care and dependent 

care flexible spending accounts for FDJC Choice. 

The web-enabled enrollment and recordkeeping system must have the capacity to meet the 

administrative service requirements to elect a contribution amount, maintain data and 

administer the claims reimbursement process as follows: 

• Provide an online application to support enrollment, recordkecping, requisition, 

documentation management (processes for receiving, scanning and reviewing 

receipts for expenses paid), authorization and claims processing for employees 

requesting reimbursements for parking expenses 

• Prepare and submit electronic file of election data/record changes and forward to the 

NFC based on established prescribed record formats 

• Electronically maintain ongoing account balances rolled-over plan years 

• Communications automation -- electronically generate and send forms. notifications, 

etc., to employees and the FDIC Parking Administrator 

• Provide a biweekly report of enrollment status (pending, approved, declined. election 

amount) to the FDIC Parking Administrator 

• Establish and implement reconlkeeping and electronic data interchanges with FDlC 

Division of Finance to administer the claims pay-out process 

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Appendix 9 

Administrative Services Requirements for Pl ,A 

The TPA shall develop a secure, private, web-based onlinc Training System application to 

support the FDJC's administration, and management of the Professional Learning Accounts 

(PLAs), with the capability of on line completion of FDICs Career Development Plan (CDP.) 

Before training can be requisitioned through the PLA Program, an eligible employee must 

complete an online Career Development Plan (CDP) that is approved by the supervisor. The 

administration of PLA for each participant must account for the cost of all training and travel 

expenses incurred with respect to training and ensure that the employee does not incur 

expenses in excess of the allotted account amount. 

When the TPA builds the enrollment and record.keeping application to administer FDIC 

Choice, it will already be populated with a significant amount of employee infonnation that 

can be utilized to timely implement needed CDP and PLA functions. An automated nightly 

feed of personnel information from FDIC to the contractor/TPA is used to detennme PLAcligiblc employees, initially and ongoing. Students, employees on a tcnn or temporary 

appointment and employees in certain specific categories arc not eligible for PLA funds. The 

FDIC data will identify employee information such as job title, job code, appointment type 

and grade level which can be used to identify employees eligible for PLA. Established 

business rules can be used to dctennine initial eligibility, as well as changes that occur when 

personnel ac1ions arc processed. Approximately 5,900 employees are eligible to participate in 

the PLA Program. 

Through the online system, FDIC's employees, supervisors, and administrators manage their 

respective CDP completion and online external training request workflows which may 

encompass (1) Requisitioning, (2) Business rules, (3) Supervisor's approval/denial 

workflows, (4) Administrator expense payment tracking, (5) Employee, Supervisor, 

Administrator & Management reporting, (6) Online evaluation notice, completion and 

submission, (7) various administrative functions (i.e. training cancellation processing. 

employee separation processing), and (8) Toll-Free customer service. 

Each eligible employee has a PLA containing a specified annual amount of money and/or 

hours that is managed in partnership with the supervisor for use towards learning goals. An 

inte~rral clement of automation for the PLA Program includes accurate tracking of each 

eligible employee's PLA funds, including PLA Budgeted Amounts, PLA Amounts Paid, 

PLA Amounts Pending Approval, and PLA Amounts Pending Payment. Programming will 

control the available balance to assure the FDIC Payors are prompted - within system- to 

make payments that do not exceed the annual PLA budgets for each employee. 

The online web-based environment to facilitate an automated CDP/PLA administration 

process shall include creating a CDP/PLA database management system, aulomating PLA 

forms, tracking PLA funding expense details, coordinating with FDIC systems, generating 

reports, implementing a production system, and testing and troubleshooting production 

problems. Following are detailed requirements: 

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• A PLA private, secure, onlinc database management system to support the collection 

and storage of data required for the completion of the FDIC CDP and the requisition 

and administration of external training as outlined in the Career Development Plan 

Form (2600/26), the FDIC Training and Approval Evaluation Form (2610/12) and 

any other data required by FDTC 

• Ability to import personnel infonnation lo electronically detennine employee 

eligibility to participate 

• Data entry screens with real-time error checking that incorporate client specific 

business rules to assure accurate data collection/storage for CDP/PLA administration. 

• Ad-hoc query and reporting capabilities for participation and trend analysis. 

• Predefined standard reports on a scheduled basis (secure file transfer). 

• An onlinc signature process that retains the information necessary to prove users' 

online sib111atures (employee, supervisor, 2nd level supervisor-optional, 

administrator). 

• Secure access to PLA data via the secure, private, web-based site that uses Secure 

Socket Layer connections ( encryption) and other processes to protect information. 

• Tracking of dollar amounts. financial infonnation and balance histories associated 

,vith PLA Training (tuition, books, fees, etc.) similar to the administration of the 

Flexible Spending Accounts 

• Tracking of dollar amounts associated with PLA Training Travel (hotel, 

transportation, per diem). 

• Ability to provide warnings when aggregate CU budget funds arc running low. 

Provide instant employee communications when balances reach specific funding 

levels. 

• Prohibit PT ,A training dollars from exceeding thresholds (absent override). Program 

system to be parameterized with funding minimums and maximums. 

• Ability to develop, route and track an online training evaluation process (electronic 

notice, completion and response submission) to obtain information outlined in the 

FDIC Training and Approval Evaluation Form (2610/12). Also, the evaluation 

application must have the ability to elevate information through defined processes to 

correspond with a hierarchical approval/review process within the FDIC. 

• "Role-based" ability to override values and business rules. 

• Capability for adding user defined roles; setup secured by user role definitions. 

• Capability to track data for special training programs that arc offset by PLA funds. 

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• Data dumps in standard formats. 

• Programming updates to the system to accommodate new users, changes in business 

rules, and other changes, as required periodically throughout the term of the contract. 

• Provide job aids (help screens,) not only on-line in the system, but also documents 

with screen prints and instructions, and job aids for super user functions/capabilities. 

• Benefits Hotline Call Center Support providing employees with support regarding the 

completion of the CDP and the use of their PL!\ account information and 

functionality. 

The automated system must have the capability to produce ad-hoc and pre-defined reports 

that will provide CU management with information needed to monitor participation, audit 

costs and time allocations, as well as forecast future training initiatives. 

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Appendix 10 

Hcncfits Hotline Service Delivery 

The TP A's Benefits Hotline staff shall act as a second level of service delivery in a three-tier 

system to support all the programs outlined in this document. 

FDIC employees are first expected to "self-service" their benefits questions, using resources 

available: 

1. onlinc on the FDIC Intranet 

7 onlinc library at TPA 's web-based system (for information and elections relative to 

benefits contained in the FDIC Choice cafeteria plan and other programs 

administered by the TPA) 

3. onlinc on T. Rowe Price's Plan Web site or through their P!an Account I,ine (for the 

FDIC Savings Plan) 

4. onlinc or over the telephone at the Employee Personal Page of the NFC website (for 

open enrollment federal benefit changes), 

5. as well as, other Web sites available to FDIC employees about their federal and FDIC 

benefits, such as the Office of Personnel Management and benefit plan carriers. 

The TPA's Benefits Hotline shall: 

6. Provide qualified customer service representatives during proposed hours of 

operation, i.e., from 8:30 a.m. to 8:00 p.m. Eastern Time. Employee access shall be 

available via a toll-free telephone number, as well as a general email address, and 

occasional FAX requests. The TP/\'s Benefit.~ Hotline staff will receive calls from 

some individuals who are hearing-impaired, so a TDD/TTY Toll-free line shall also 

be required. 

7. Respond to FDIC employees' basic questions about their FDIC and federal benefits. 

a. FDIC-specific benefit programs currently include the following: 

(i) FDIC Choice (a flexible cafeteria plan that incorporates life 

insurance, dental and vision insurance, long-term disability coverage 

and both dependent care and health care flexible spending accounts), 

(ii) FDIC Dental and Life Insurance for Retirees 

(iii) FDIC Domestic Partner Program (including Health Insurance 

Premium Reimbursement processing) 

(iv) FDIC Parking Flexible Spending Account 

(v) .FDIC Professional J,earning Accounts Program 

(vi) FDIC Savings Plan (a 40l(k) plan), 

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b. Federal benefits include the following (the TPA will not have sufficient 

enrollmenl data to resolve in-depth issues for these programs, but can respond 

based on data in published documents and can refer/escalate the issue to the 

appropriak servicing FDIC Benefits Specialist): 

(i) Federal Employees Jlca\th Benefits (FEHB) Program, 

(ii) Federal Employees Group Life Insurance (FEGLI) Prot,'fam. 

(iii)Federal Employees Dental and Vision Insurance Plan (FFDVIP), 

(iv)Fcderal Thrift Savings (TSP) Plan, 

(v) Federal Long Term Care Insurance, 

(vi) Federal retirement programs, both the Civil Service Retirement 

System (CSRS) and the Federal Employees Retirement System 

(FERS), and 

(vii) Social Security. 

FDIC Benefits Center stafT will assist in scnpting responses to be used by the 

Benefits Hotline. 

8. FDIC retiree inquiries shall also be handled by the TPA's Benefits Hothne staff 

FDIC retirees continue coverage in the FDJC-provided dental and life insurance 

program. Retirees also may maintain their FDIC Savings Plan retirement account 

Inquiries relating to their federal benefits shall not be answered, but shall be referred 

by the TPA's Benefits JJotlme staff to the appropriate federal agency (i.e., the Office 

of Personnel Management for retirement, health and life insurance. the TSP Office 

for the federal Thrift Savings Plan, the Social Security Administration for social 

security.) 

9. Answer general and basic questions about benefits. Questions will include, but arc 

not limited to: 

a. FDTC employee eligibility requirements for coverage in one or more benefits 

plans; 

b. FDTC employee e!i,gibility to make changes to benefit plans based on particular 

life event; 

c. Status of enrollment changes: 

d. Basic description of benefit plans (requests for detailed description of a plan shall 

be answered by directing the employee to the plan's summary plan description on 

the FDIC or TPA ·s web site); 

c. Current benefit election amounts. costs, etc. 

10. TPA 's Benefits Hotline staff shall have read-only access to CAIS (T. Rowe Price's 

Client Access Inquiry System) to reply to general questions regarding the FDIC 

Savings Plan. 

11. Refer callers to appropriate system to make benefit changes, e.g., myRetirementPlan 

or Plan Account Line, Employee Personal Page, TSP, or TPA enrollment system and 

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assist callers with making eligible changcs online by talking them through the process 

,vhen necessary. 

12. Provide infonnation to FDIC employees about how to obtain personal identification 

numbers (P!Ns) for each of the above systems. 

13. Instruct callers on how to obtain electronic copies of material requested, and mail 

requested claim forms, designations of beneficiary fonns. summary plan descriptions, 

etc._ upon request by a caller unable to access electronic versions of the material. 

14. Assist in the open enrollment processes for FDIC Choice and certain federal 

programs by answering general inquines relative to each program and assisting 

employees with making thetr elected changes in the appropriate system. 

15. When a complicated qucstion or request for additional or detailed information that 

cannot be answered using available resources is received, the Benefits Hotline staff 

shall record all pertinent infonnation and inform the caller that the FDIC Benefits 

Center will reply to the inquiry. The TPA shall maintain Hotline referrals of 

complicated inquiries to the FDIC Benefits Center in an automated system with 

tracking and query capabilities, as described below. Examples of questions that shall 

be referred to the FDIC Benefits Center include: 

a. Requests for retirement or separation benefits counseling; 

b. Notification ofthe death of an employee or retiree; 

c. Questions about retirement coverage; i.e., whether coverage should be under a 

different defined benefit retirement system (CSRS or FERS) than employee is 

currently covered under, or an explanation of why employee is covered under 

current system; 

d. Requests for infonnation about paying service credit deposits for prior military or 

civilian service; 

e. Requests to make changes to FLUB insurance outside of open enrollment. 

16. The TPA"s automated system shall be able to track al\ inquiries, as well as referrals to 

the FDIC Benefits Center, noting date, time, resolution, and/or to whom the inquiry 

was referred. Three (3) workdays after an inquiry is referred to the FDIC Benefits 

Center, the TPA Benefits Hotline staff shall contact the FDIC Benefits Center staff to 

confirm (a) if the call has been returned, (b) if the call is closed, or (c) when the FDIC 

Benefits Center staff told the caller that they would complete the response, ifit could 

not be closed on the first call. Such contact after three workdays is not required if the 

FDIC Benefits Center staff has contacted the TPA's Benefits Hotline, acknowledging 

receipt and indicating that the inquiry is being handled. Calls not closed satisfactorily 

shall be referred to the FDIC Oversight Manager. The TPA's Benefits Hotline staff 

shall continue to track the call until it is closed by cont.acting the employee directly 

on any further follow-ups. Subsequent follow-up with the employee shall occur no 

later than the 6th business day following initial receipt of the inquiry. 

17. The TPA's automated system shall also track the number and nature of inquiries, 

time for response, including referrals, and provide quarterly reports to the FDIC 

Oversight Manager. The TPA's Benefits Hotline staff, and the FDIC Oversight 

Manager, shall be able to query the aulomatcd system to immediately detennine the 

status of an individual referral. 

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CORHQ-13 C-0148 

Page 124 

18. Serve as primary contact for FDJC retirees. This includes the following services: 

a. Assist retirees with changing their mailing address in the TPA 's system for FDIC 

Life and Dental coverage; 

b. Refer retirees to T. Rowe Price to change mailing address for their FDJC Savings 

Plan accounts and to the Office of Personnel Management (OPM) for their 

retirement benefits; 

c. Answer general inquiries about their dental and/or life insurance coverage(s); 

d. Provide summary plan descriptions, claim fonns or designations of beneficiary 

forms for FDJC Life and/or Dental plans; 

e. Refer retirees to the FDlC Retiree Web site for electronic versions of above 

material for those retirees with internet access. Refer retirees to the Office of 

Personnel Management for information about their retirement or health insurance 

benefits. 

PAGE 124 OF 132 
CORH0-13-C--0148 

Page 125 

Appendix 11 

Benefits Hotline Performance Requirements 

The TPA shall staff and operate the Benefits Hotline Call Center. The TPA 's staff shall 

answer incoming calls and emails and provide assistance and information to FDIC employees 

and retirees as identified above. TPA shall ensure the infonnation provided to callers is 

consisknt and accurate. The TPA shall operate the Benefits Hotline from Monday through 

Friday between the hours of 8:30 a.m. and 8:00 p.m. Eastern Time, excluding federal 

holidays. The TPA shall maintain an automated activity log of all calls and emails received 

and status of resolution. TPA shall provide the log to the FDIC Oversight Mana~cr monthly, 

or as requested. 

As of March 2013, there were approximately 7700 current FDIC employees and 3900 retirees 

or surviving spouses eligible for FDIC benefits. FDIC makes no representation or warranties 

to TPA as to the future number of FDIC employees or retirees. 

A. Answering Calls 

The TPA 's staff shall answer no less than 90% of all incoming telephone calls within 

15 seconds. The TPA's staff shall not place the caller on hold for more than 45 

seconds. ·'Hold" is defined as a call temporarily left without being disconnected. 

The call should be returned to with either a result or status report within 45 seconds. 

Surges in call volumes are anticipated during annual open enrollment penods (i.e. 

Monday of the second full workweek in November through Monday of the second 

full work week in December.) Additional Benefits Hotline staff and resources shall 

be provided by the TPA during surge periods, as required, to respond to the expected . . . mcrcasc m mqumes. 

B, Scripting Software 

The TPA shall provide and utiliL-e scripting software to facilitate the timely 

development, maintenance and retrieval of information. The scripting software shall: 

] . Store and retrieve scripts to be used in answering general questions; 

2. Provide email functionality that shall allow for sending responses that are 

either individually created or pre-fonnatled; 

3. Provided scripted respom,es to frequently asked questions; 

4. Provide knowledge-based functionality; 

5. Provide search capability of previous responses to locate nonstandard 

answers; and 

6. Provide call tracking by both quantity and type of calls. 

PAGE 1250F 132 
CORHQ·13-G-0148 

Page 126 

The TPA shall develop and maintain call scripts and training modules for its 

operators. The TPA shall suhmit call scripts and training modules to the FDIC 

Oversight Manager for approval. The Benefits Hotline shall he fully scripted, tested 

and operational not later than November 1, 2013. 

C. First Tier Screening 

The TPA 's Benefits Hotline staff shall provide for initial ~creening of calls, emails, 

voicemails, and FAXes. Incoming calls, emails, voicemails, and FAXes shall be 

answered and satisfactorily resolved or a transfer shall be made to the FDIC Benefits 

Center. Incorrectly transferred calls, emails, voicemails and .FAXcs shall be 

maintained at a minimum as defined by the FDIC Oversight Manager. TPA shall 

resolve no less than 75% of all inbound calls accurately, efficiently, and in a friendly 

manner without transfers whenever feasible. (This standard shall be revised as the 

TPA 's knowledge and expertise is expanded over time and as experience dictates.) 

D. Second Tier/FDIC Benefits Center 

\Vhen a call, email, voiccmail, or FAX is too complicated for the Benefits Hotline 

staff to respond, a warm/supervised transfer shall be made to the FDIC Benefits 

Center, which shall be responsible for providing the appropriate information to the 

caller. The Benefits Hotline staff shall track the status of the referral until it 1s 

resolved to the caller's satisfaction, and include the status of outstanding responses in 

its weekly status report to the FDIC Oversight Manager. 

E. Voice Mailbox 

During normal hours of operation, callers may elect to leave messages m a voice 

mailbox rather than hold. The messages kft in a voice mailbox during normal 

Benefits Hotline operating hours shall not go unanswered for more than two hours. 

The Benefits Hotline shall include in the automated tracking system emails received, 

as \veil as telephone calls and voiccmails. The Benefits Hotline shall track the status 

of referrals until they are resolved to the caller's satisfaction, and include the status of 

outstanding responses in its weekly status report to the FDIC Oversight Manager. 

F. F.mail 

The TPA Benefits Hotline shall maintain an email address to which FDIC employees 

and retirees may direct inquiries related to their benefits. All emails directed to the 

Benefits Hotline shall be answered, or referred to the FDIC Benefits Center, if the 

subject is complex or includes a request for counseling services. Referrals shall be 

fonvarded to the FDIC Benefits Center within two hours ofreecipt. Emails that can 

be answered by the Benefits Hotline staff shall be responded to within one business 

day. Emails received outside of nonnal business hours shall be answered or referred 

the next business day, i.e., referred within two hours of the beginning of the business 

day or answered by the end of the business day. 

The Benefits Hotline shall include in the automated tracking system emails received, 

as well as telephone calls and voicemails. The Benefits Hotline shall track the status 

of referrals until they are resolved to the caller's satisfaction and include the status of 

outstanding responses in its weekly status report to the FDIC Oversight Manager. 

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CORI 1O· 13-C-0148 

Page 127 

G. Customer Satisfaction 

The FDIC is committed to providing quality customer service and ensuring all 

reasonable efforts are made to meet the benefits information and service needs of its 

employees and retirees. It is mandatory that professional and courteous telephone 

services be provided. 

The rPA shall continuously review processes and incorporate best practices and 

pertinent recommendations from FDIC employees and retirees to improve 

performance and ultimately improve customer satisfaction. 

H. Contingency Operations 

The TPA shall have and maintain a FDIC-approved contingency plan to ensure 

con1inuous service in case of a problem or surge in call volume. The TPA shall 

provide overflmv resources to handle call volumes. 

I. Performance Requirements 

The table below, entitled Performance Requirements, outlines the specific 

performance standards applicable to the required services. These standards are the 

minimum acceptable level of pcrfom1ance. The FDIC encourages the TPA to use 

innovative approaches to meet or exceed the standards specified below. The FDIC 

reserves the right to change or modif)1 the specified standards. These standards shall 

be measured each quarter and shall be combined and averaged over a 6-month period 

to determine the TPA 's overall performance rating. 

PAGE 127 OF 132 
Page 128 PAGE 128 OF 132 

Performance Requirements 

--- Item Performance Requirement/SOW Minimum Performance 

Reference Acceptable Measurement 

Performance 

Standard 

~-- - -------

l. Customer satisfaction (meet needs TP;\ must achieve a FDIC conducted 

of employees/retirees: Disseminate 90% satisfaction ··customer 

mformation accurately and rating. satisfaction" surveys 

etliciently in a friendly manner.) on an annual basis. 

Appendix 11.G 

···---

2. Respond to inbound calls quickly. 15 second average TPA 's quarterly 

Appendix 11.A speed of answer report lo FDIC 

during non-surge Oversight Manager 

periods, on hold less 

than 45 seconds 

.. ··~-------

3. Respond to voice mailbox messages Within two hours TPA 's quarterly 

quickly Appendix 11.E report to FDIC 

Oversight Manager 

4. Respond to email messages quickly. Within one business TPA' s quarterly 

Appendix 11.F day report to FDJC 

Oversight Manager 

-- -

5. Track unresolved inquiries referred 100% of inquiries TPA' s quarterly 

to the FDIC Benefits Center for referred must be report to FDIC 

reply. Appendix 11.D tracked by TPA Oversight Manager 

-· 

6. Resolve inbound calls accurately, No less than 75% TPA, s quarterly 

efficiently, and in a friendly manner report to FDIC 

without transfers whenever feasible. Oversight Manager 

Appendix] 1.C 

----

CORHQ-13-C·0148 
CORHQ-13-C-0148 

Page 129 

Appendix 12 

Billing and Payment Services for FDIC Dental Plan 

Employees may continue coverage into retirement if they have retired on an immediate 

annuity and have been enrolled in FDIC dental coverage as the enrollee or a covered 

dependent for at least five (5) consecutive years immediately preceding retirement, or for the 

full penod for which eligible, whichever is less. Survivors of employees enrolled in a Self & 

Family enrollment may continue coverage for up to twenty-four months following the 

employee's death. Currently, survivors of retirees enrolled in Self & Family coverage may 

continue as long as the benefit is offered. Eligible retirees and survivors of employees and 

retirees are covered under the Standard Option coverage only. Retirees and survivors arc not 

able to select the High Option or Low Option. 

The following arc the functions that the TPA and Benefits Hotline shall perform related to 

the FDIC Dental Plan for retirees and survivors: 

1. Maintain and administer FDIC Retiree and Survivor Dental enrollment and 

billing processes based on eligibility to include: 

a. create a database to establish and track retirees' dental enrollment and 

premiums on a monthly basis; 

b. calculate the appropriate premlum due 

c. annually develop and manage a self-certification process for enrollees 

d. establish and maintain a drop box for premium payments 

e. print and mail an annual premium billing package to enrollees 

designed by FDJC: 

f. maintain an accurate accounts receivable accounting including aging 

uncollected funds: 

g. print and mail past due premium billings and tcnnination notification 

on a quarterly basis 

h. set up an automated cancellation process for accounts with 

uncollected funds: 

1. enroll, bill and manage new enrollees throughout the year 

J. manage billing adjustments that include retroactive billing 

adjustments for status changes due to a death of a spouse, divorce, 

marriage, or birth of a child; 

k. service all customer inquiries related to billing. 

1. coordinate enrollments, changes and cancellations with FDIC's 

regular biweekly premium payment process; 

m. cross reference enrollment with Social Security Administration death 

records: 

n. issue identification cards with an alternative number to be used 

instead of the Social Security Number 

2. Reporting 

a. provide biweekly premium report to FDIC 

b. biweekly enrollment file transmission to dental plan administrator 

c. quarterly report of terminations due to non-payment of premium 

d. provide annual accounting of premiums collected 

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CORHQ-13-C-0148 

Page 130 

e. census report as requested 

3. On-line system capability 

a. enrollment and recordkccping for enrollee and FDJC 

h. reference library of FDIC-provided documents and links to FDIC 

provided web sites 

PAGE 130 OF 132 
CORHQ-13-C-0 148 

Page 131 

Appendix 13 

Health Benefits Premium Reimhurscment to Certain Retirees 

The services outlined arc required for the TPA to conduct semiannual reimbursements of 

health benefits premium expenses to certain retirees: 

1. Fon-vard requests to the affected retirees to verify banking data, contact information 

and to certify health plan coverage. 

2. Update records according to retiree responses; i.e., they have indicated that their 

health plan coverage remains the same a~ it wa~ when the prior reimbursement was 

issued or they have annotated changes and provide official documentation supporting 

such change. 

3. Compute the total premium reimbursement due based on the responses received from 

the retirees. 

4_ Fonvard a consolidated report with premium reimbursement values to FDIC to 

request funds from FDIC's Division of Finance for reimbursement payments. 

5. Allocate amounts and issue reimbursements to each retiree participant. 

6. Conduct quality control process to determine nonpayment fallout and report results to 

FDIC Benefits Manager. 

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Page 132 PAGE 132 OF 132 

ATTACHMENT J - 2 

KEY PERSONNEL LISTING 

l(b)(6) 

I 

~ I'---. 

-

NAME TITLE ~ --

~ President/CEO ---- L... 

Large Account Manager ---~--

-

-·--··--- ---· 

--~~-

~ -

CORHQ-13-C-0148