Recently a Texas school district awarded a contract for TPA administration based, in part, upon representations made to the Board of Trustees by salaried representatives of the TPA. After the contract was awarded it was discovered material misrepresentations were made prior to contract award and upon which the Board of Trustees placed paramount importance in their decision making process.
Upon protest, including submitting video tapes documenting the TPA’s representatives false and misleading representations, the TPA refused to honor the promises made by their salaried representatives.
Standard within many of their RFP responses can be found the following “Gotcha Clause”:
The RFP and our responses themselves, in their entirety, shall not be incorporated into any subsequent contract and, in case of conflict, the mutually agreed upon terms and/or conditions of a contract drafted after selection of (Name of TPA) as the administrator shall take precedence over anything contained in this proposal.
Unless specifically stated otherwise in our response (Name of TPA)’s bid is condition upon (Name of Plan Sponsor)’s agreement to the terms and conditions of XXXXXX’s group administration document.