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HomeMy WebLinkAbout1996-10-28 City Council (12)TO: City of Palo Alto City Manager’s Report HONORABLE CITY COUNCIL 2 FROM:CITY MANAGER DEPARTMENT: Human Resources AGENDA DATE: SUBJECT: October 28, 1996 CMR:448:96 WORKERS’ COMPENSATION CLAIMS ADMINISTRATION SERVICE - AWARD OF CONTRACT REQUEST For the last three years, the City. has contracted with Athens Administrators for Workers’ Compensation Claims Administration Services. The current agreement expires on October 31, 1996, and the Human Resources Department requests approval to renew this agreement. This agreement is for a one-year term, with options to renew for an additional two years, for a total term not to exceed three years. Funding in the amount of $160,000 for this agreement is included in the 1996-97 budget. RECOMMENDATIONS Staff recommends that Council authorize the Mayor to execute an agreement with Athens Administrators. POLICY IMPLICATIONS The renewal of this contract would not impact existing policies. EXECUTIVE SUMMARY Since November 1, 1993, the City has contracted with Athens Administrators for workers’ compensation claims administration. This relationship has been very beneficial for the City and resulted in significant savings, in spite of the volatility of the health care industry and the complexity of workers’ compensation laws. CMR:448:96 Page 1 of 3 Proposals were solicited in May 1996 from eight companies to provide this service. Selection consisted of an evaluation of proposal materials, contact and evaluation of references, site visits, oral presentations and interviews. The selection committee consisted of the City Safety Officer, Benefits Manager, Risk Manager, Human Resources staff personnel and a worker’s compensation consultant. The three finalists interviewed were Claims Management Inc., JT2 and Tristar. Their annual quoted service fees were as follows: Claims Management Inc. JT2 Athens Administrators $153,000 $145,500 $160,000 Although Athens Administrators submitted the highest service fee quote, two performance provisions are included in the agreement that specify additional savings to the City. The City would save approximately $25,000 with the performance goals, with a penalty to be paid in the amount of $10,000, in the event the goals are not met. Athens Administrators has played a key role in the City’s integrated disability management and safety programs. Combined efforts have dramatically reduced the City’s overall funding requirements for these programs, by reducing costs and integrating utilization and bill review services into the City’s disability management program. Athens has accomplished this task by developing a knowledge of City programs, policies and procedures and working in concert with the Risk Management and Safety Office in the Human Resources Department. Since the City began conducting business with Athens in 1993, the total claims reported were more than 250 per year. Total reported claims for fiscal year 1995-96 were 186. Open indemnity claims were 250 in 1993; we now have 146 as of June 30, 1996. Claims costs were $4808 per claim in 1993; claims cost as of June 30, 1996 are $3832. Athens has successfully integrated claims management strategy with the City’s Injury and Illness Prevention Program, to help achieve significant reductions in all claims costs. We have reduced medical costs by 42.2 percent, and future liabilities by 28.6 percent. CMR:448:96 Page 2 of 3 FISCAL IMPACT Funds, not to exceed $160,000, are included in the 1996-97 operating budget. The increase in service fees, with the performance goals, will represent an 8 percent increase over last year’s agreement. ENVIRONMENTAL ASSESSMENT There is no Environmental Assessment required for this agreement. ATTACHMENTS Copy of Agreement Exhibit "A" includes the Scope of Services Exhibit "B" is the Insurance Certificate PREPARED BY: Randall Rafoth, Risk Manager DEPARTMENT HEAD REVIEW: ,., JAY C~ROUND S Director of Human Resources CITY MANAGER APPROVAL: CMR:448:96 Page 3 of 3 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND ATHENS ADMINISTRATORS FOR WORKERS’ COMPENSATION ADMINISTRATION SERVICES THIS AGREEMENT is made and entered into this day of , 1996, by and between the CITY OF PALO ALTO, a municipal corporation of California, hereinafter referred to as "CITY," and ATHENS ADMINISTRATORS (Taxpayer Identification Number ), a wholly-owned subsidiary of James C. Jenkins Insurance Services, Inc., with offices at 2552 Stanwell Drive, Concord, CA 94522, hereinafter referred to as "CONTRACTOR"; W I T N E S S E T H: WHEREAS, CITY desires to contract for certain workers’ compensation administrative services; and WHEREAS, CITY desires to engage CONTRACTOR to provide these services by reason of its qualifications and experience for performing such services, and CONTRACTOR has offered to provide the required services on the terms and in the manner set forth herein; NOW, THEREFORE, in consideration of their covenants, the parties hereto agree as follows: mutual SECTION 1 DEFINITIONS i.I CITY The term "CITY" shall mean the City of Palo Alto, California. 1.2 CITY MANAGER The term "City Manager" shall mean the duly appointed City Manager of the City of Palo Alto, California, or his or her designated representative. 1.3 RISK MANAGER The term "Risk Manager" shall mean the duly appointed Risk Manager of the City of Palo Alto, California, or his or her designated representative. 1.4 PROJECT The term "Project" shall mean the services described in Exhibit "A", entitled "Scope of Services," attached hereto and made a part hereof by this reference. 1 961018 lac 0~31442 SECTION 2 PROJECT COORDINATION 2.1 CITY The City Manager shall be representative of CITY for all purposes under this Agreement. Randall Rafoth, the Risk Manager, is designated as the Project Manager for the City Manager, and he shal! supervise the progress and execution of this Agreement. 2.2 CONTRACTOR CONTRACTOR shall assign a single Project Director to have overall responsibility for the progress and execution of this Agreement for CONTRACTOR. Peter J. Brown, the President of CONTRACTOR, hereby is designated as the Project Director for CONTRACTOR. Should circumstances or conditions subsequent to the execution of this Agreement require a substitute Project Director for any reason, the Project Director designee shall be subject to the prior written approval of the Project Manager. Jaynene Carter shall be the Senior Examiner assigned by CONTRACTOR for this Agreement, and she shall work exclusively on this Agreement.She shall be supervised by Darla Carey. SECTION 3 DUTIES OF CONTRACTOR 3.1 SERVICES TO BE FURNISHED CONTRACTOR shall provide all specified services as set forth in Exhibit A. 3.2 LAWS TO BE OBSERVED CONTRACTOR shall: 3.2.1 Procure all permits and licenses, pay all charges and fees, and give all notices which may be necessary and incident to the due and lawful prosecution of the services to be performed by CONTRACTOR under this Agreement; 3.2.2 Keep itself fully informed of all existing and future federal, state, and local laws, ordinances, regulations, orders, and decrees which may affect those engaged or employed under this Agreement, any materials used in CONTRACTOR’s performance under this Agreement, or the performance of the services under this Agreement; 3.2.3 At all times observe and comply with, and cause all of its subcontractors and employees, if any, to observe and comply with, the laws, ordinances, regulations, orders and decrees mentioned above; and 3.2.4 Immediately report to the Project Manager in writing any discrepancy or inconsistency it discovers in the laws, ordinances, regulations, orders, and decrees mentioned above 2 961018 lac 0031442 in relation to any plans, drawings, specifications or provisions of this Agreement. 3.3 RELEASE OF REPORTS AND INFORMATION No reports, information, data or other material given to, or prepared or assembled by, CONTRACTOR or its subcontractors, if any, under this Agreement shall be made available to any individual or organization by CONTRACTOR or its subcontractors, if any, without the prior written approval of the City Manager. 3.4 COPIES OF REPORTS AND INFORMATION If CITY requests additional copies of any reports, drawings, data or any other material which CONTRACTOR is required to furnish in limited quantities as part of the services under this Agreement, CONTRACTOR shall provide such additional copies as are requested and CITY shall compensate CONTRACTOR for the costs of duplicating of such copies at CONTRACTOR’s cost. 3.5 QUALIFICATIONS OF CONTRACTOR CONTRACTOR represents that it has the expertise and professional qualifications to furnish the services described under this Agreement. As evidence thereof, CONTRACTOR warrants that one or more members of employees of the firm are licensed by the State of California and that the services to be provided under this Agreement will be performed by them or under their supervision. 3.6 COMPLIANCE WITH ADA CONTRACTOR states that it is aware of the requirements of the Americans with Disabilities Act of 1990, and the Fair Employment and Housing Act provisions, relating to the rights of persons with disabilities. CONTRACTOR shall comply with or ensure by its advice that compliance with such provisions will be effected pursuant to the terms of this Agreement. SECTION 4 - COMPENSATION For the full performance of the administrative services described herein by CONTRACTOR for the first year of the term of this Agreement, CITY shall pay CONTRACTOR the total sum of One Hundred Sixty Thousand Dollars ($160,000), payable in eleven (ii) monthly billings of $13,333.00 and one monthly billing of $13,337.00. Each monthly payment shall be made within thirty (30) days of receipt by CITY of a properly supported invoice, provided by CONTRACTOR, in triplicate, mailed to the City of Palo Alto, Attn: Risk Manager, 250 Hamilton Avenue, Palo Alto, CA. Any additional services for which additional fees would be payable shall be negotiated by the parties outside the scope of this Agreement, and shall be subject to approval of the City Council. 3 961018 lsc 0031442 In the event this Agreement is renewed for any additional one year terms, CITY shall pay CONTRACTOR an amount to be negotiated by the parties, in amount not to exceed five percent (5%) over the previous one year term. SECTION 5 TERM This Agreement shall commence on November I, 1996, and shall continue for one (I) year. This Agreement may be renewed on an annual basis, for a total term not to exceed three (3) years, to expire no later than October 31, 1999. Each annual renewal hereof shall be subject to the City Council’s continued annual appropriation of sufficient funds for this Agreement and the mutual agreement between the parties to renew the Agreement for an additional year. If the parties desire to negotiate additional yearly renewals as authorized by this section, the parties shall commence negotiations for the each successive annual term beginning 60 days prior to the end of the then current annual term. Agreement for each successive annual term shall be concluded at least thirty (30) days prior to the end of the then current annual term. SECTION 6 EXTENSION OF TERM In the event that the services called for under this Agreement are not completed within the time specified above, the City Manager shall have the option to extend the time for completion. This paragraph does not preclude the recovery of damages for delay by either party. SECTION 7 TERMINATION OR SUSPENSION OF AGREEMENT 7.1 RIGHT TO SUSPEND OR TERMINATE Notwithstanding Section 5 hereof, the City Manager may suspend this Agreement, in whole or in part, or terminate this Agreement, with or without cause, by giving sixty (60) days’ prior written notice thereof to CONTRACTOR. Upon receipt of such notice, CONTRACTOR shall immediately discontinue its performance under this Agreement. CONTRACTOR may terminate this Agreement or suspend work on the Project by giving sixty (60) days’ prior written notice thereof to CITY, but only in the event of substantial failure of performance by CITY or in the event CITY abandons or indefinitely postpones the Project. 7.2 PAYMENT Upon such suspension or termination by CITY, CONTRACTOR shall be paid for all services actually rendered to CITY to the date of such suspension or termination; provided, however, if this Agreement is suspended or terminated for fault of CONTRACTOR, CITY shall be obligated to compensate CONTRACTOR only for that portion 4 961018 lac 0031442 of CONTRACTOR’s services which are of benefit to CITY, as such determination may be made by the City Manager in the reasonable exercise of his or her discretion. 7.3 RETURN OF MATERIALS Upon such suspension or termination, CONTRACTOR shall turn over to the City Manager immediately any and all documents and other data, whether or not completed, prepared by CONTRACTOR or its subcontractors, if any, or given to CONTRACTOR or its subcontractors, if any, in connection with this Agreement.Such materials shall become the permanent property of CITY. 7.4 FINAL ACCOUNTING Upon any cancellation or termination of this Agreement, CONTRACTOR shall make a final accounting of all fees payable to CONTRACTOR hereunder and a final accounting of any funds belonging to CITY then in the possession of CONTRACTOR, and any balance due either party shall be paid to the party entitled thereto no later than forty-five (45) days following such cancellation or termination, unless necessary for the final administration of any outstanding claims. It shall be understood that all claim files, open and closed, are and remain the exclusive property of CITY and CITY shall retain the right and option to remove from CONTRACTOR said claim files upon any cancellation or termination of this Agreement. SECTION 8 - INDEPENDENT JUDGMENT Failure of CITY to agree with CONTRACTOR’s independent findings, conclusions, or recommendations, if the same are called for under this Agreement, on the basis of differences in matters of judgment, shall not be construed as failure on the part of CONTRACTOR to meet the requirements of this Agreement. SECTION 9 AND EMPLOYEES ASSIGNMENT; PERSONAL SERVICES; SUBCONTRACTORS 9.1 ASSIGNMENT Both parties shall give their personal attention to the faithful performance of this Agreement and shall not assign, transfer, convey, or otherwise dispose of this Agreement or any right, title or interest in or to the same or any part thereof without the prior written consent of the other party, and then only subject to such terms and conditions as the other party may require. A consent to one assignment shall not be deemed to be a consent to any.subsequent assignments. Any assignment without such approval shall be void and, at the option of the other party, shall terminate this Agreement and any license or privilege granted herein. This Agreement and any interest herein shall not be assignable by operation of law without the prior written consent of the other party. 5 961018 lac 0031442 9.2 PERSONAL SERVICES It is agreed that this Agreement is for the personal services of CONTRACTOR and cannot be performed by any other person or organization. 9.3 SUBCONTRACTORS; EMPLOYEES CONTRACTOR shall be responsible for employing or engaging all persons necessary to perform the services of CONTRACTOR hereunder. No subcontractor of CONTRACTOR will be recognized by CITY as such; rather, all subcontractors are deemed to be employees of CONTRACTOR, and it agrees to be responsible for their performance. CONTRACTOR shall give its personal attention to the fulfillment of the provisions of this Agreement by all of its employees and subcontractors, if any, and shall keep the work under its control. If any employee or subcontractor of CONTRACTOR fails or refuses to carry out the provisions of this Agreement or appears to be incompetent or to act in a disorderly or improper manner, the employee or subcontractor shall be discharged immediately from the work under this Agreement on demand of the Project Manager. SECTION I0 NOTICES All notices hereunder shall be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY:Office of the City Clerk Post Office Box 10250 Palo Alto, CA 94303 To CONTRACTOR: Attention of the Project Director at the address of CONTRACTOR recited above SECTION ii INTEREST OF CONTRACTOR In accepting this Agreement, CONTRACTOR covenants that it presently has no interest, and shall not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the services hereunder. CONTRACTOR further covenants that, in the performance of this Agreement, no subcontractor or person having such an interest shall be employed. CONTRACTOR certifies that no one who has or will have any financial interest under this Agreement is an officer or employee of CITY. It is expressly agreed that in the performance of the professional services required under this Agreement, CONTRACTOR, and any of its subcontractors or employees, shall at all times be considered independent contractors and not agents or employees of CITY. 961018 lac 0~31442 SECTION 12 -INDEMNITY CONTRACTOR agrees to protect, indemnify, defend and hold harmless CITY, its Council members, officers, agents and employees from any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss, caused by or arising out of CONTRACTOR’s, its officers’, agents’, subcontractors’ or employees’ negligent acts, errors, or omissions, or willful misconduct, or conduct for which the law may impose strict liability on CONTRACTOR in the performance of or failure to perform its obligations under this Agreement. SECTION 13 -WORKERS’ COMPENSATION CONTRACTOR, by executing this Agreement, certifies that it is aware of the provisions of the Labor Code of the State of California which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that Code, and certifies that it will comply with such provisions before commencing the performance of the work of this Agreement. SECTION 14 INSUB_ANCE 14.1 INSURANCE COVERAGE CONTRACTOR, at its sole cost and expense, shall obtain and maintain, in full force and effect throughout the entire term of this Agreement, the insurance coverage described in Exhibit "B", attached hereto and made a part hereof by this reference, insuring not only CONTRACTOR and its subcontractors, if any, but also, with the exception of workers’ compensation, emp!oyer’s liability, and professional liability insurance, naming as additional insureds CITY, its Council members, officers, agents and employees, and each of them, concerning this Agreement and the Project. All insurance coverage required hereunder shall be provided through carriers with a Best rating of A:X or higher that are admitted to do business in the State of California. Any and all subcontractors of CONTRACTOR under this Agreement shall obtain and maintain, in full force and effect throughout the term of this Agreement, identical insurance coverage, with CITY named as additional insured under such policies as required above. 14.2 EVIDENCE OF COVERAGE Certificates of such insurance, preferably on the forms provided by CITY, shall be filed with CITY concurrently with the execution of this Agreement. The certificates shall be subject to the approval of the Risk Manager and shall contain an endorsement stating that the insurance is primary coverage and will not be canceled or altered by the insurer except after filing with the City Clerk thirty (30) days’ prior written notice of such cancellation or alteration, and that the City of Palo Alto is named 7 961018 lac 0031442 as an additional insured except in policies of workers’ compensation, emp!oyer’s liability, and professional liability insurance. Current certificates of such insurance shall be kept on file at all times during the term of this Agreement with the City Clerk. 14.3 NO LIMIT OF LIABILITY The procuring of such required policy or policies of insurance shall not be construed to limit CONTRACTOR’s liability hereunder nor to fulfill the indemnification provision and requirements of this Agreement under Section 13 hereof. Notwithstanding said policy or policies of insurance, CONTRACTOR shall be obligated for the full and total amount of any damage, injury, or loss caused by the services performed under this Agreement, including after the Agreement has terminated or expired. SECTION 15 AUDITS CONTRACTOR agrees to permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONTRACTOR’s records pertaining to matters covered by this Agreement. CONTRACTOR further agrees to maintain such records for at least three (3) years after the term of this Agreement. SECTION 16 AGREEMENT BINDING The terms, covenants, and conditions of this Agreement shall apply to, and shall bind, the heirs, successors, executors, administrators, assigns, and subcontractors of both parties. SECTION 17 WAIVERS The waiver by either party of any breach or violation of any term, covenant, or condition of this Agreement, or of any provisions of any ordinance or law, shall not be deemed to be a waiver of any other term, covenant, condition, ordinance, or law or of any subsequent breach or violation of the same or of any other term, covenant, condition, ordinance, or law. The subsequent acceptance by either party of any fee or other money which may become due hereunder shall not be deemed to be a waiver of any preceding breach or violation by the other party of any term, covenant, or condition of this Agreement or of any applicable law or ordinance. SECTION 18 COSTS AND ATTORNEYS’ FEES The prevailing party in any action brought to enforce the terms of this Agreement or arising out of this Agreement may recover its reasonable costs and attorneys’ fees expended in connection with such an action from the other party. 8 961018 |ac 0031442 SECTION 19 NO IMPLIED WAIVER No payment, partial payment, acceptance, or partial acceptance by CITY shall operate as a waiver on the part of CITY of any of its rights under this Agreement. SECTION 20 NONDISCRIMINATION; PENALTY 20.1 DUTY OF CONTRACTOR No discrimination shall be made in the employment of persons under this Agreement because of the age, race, color, national origin, ancestry, religion, disability, sexual preference or sex of such person. If the value of this Agreement is, or may be, Five Thousand Dollars ($5,000) or more, CONTRACTOR agrees to meet all requirements of the Palo Alto Municipal Code pertaining to nondiscrimination in employment, including completing the "Compliance Report--Nondiscrimination Provisions of City of Palo Alto Contracts" on the form furnished by CITY, attached hereto as Exhibit "C" and made a part hereof by this reference. CONTRACTOR agrees that each agreement for services from independent providers shall contain a provision substantially as follows: "Provider shall provide CONTRACTOR with a certificate stating that he (or she) is currently in compliance with all Federal and State of California laws covering nondiscrimination in employment; that he (or she) will pursue an affirmative course of action as required by the Affirmative Action Guidelines of the City of Palo Alto; and that he (or she) will not discriminate in the employment of any person under this contract because of the age, race, color, national origin, ancestry, religion, disability, sexual preference or sex of such person." 20.2 PENALTY FOR DISCRIMINATION If CONTRACTOR is found in violation of the nondiscrimination provisions of the State of California Fair Employment Practices Act or similar provisions of federal law or executive order in the performance of this Agreement, it shall thereby be found in material breach of this Agreement. Thereupon, CITY shall have the power to cancel or suspend this Agreement, in whole or in part, or to deduct from the amount payable to CONTRACTOR the sum of Twenty-Five Dollars ($25) for each person for each calendar day during which such person was discriminated against, as damages for breach of contract, or both. Only a finding of the State of California Fair Employment Practices Commission or the equivalent federal agency or officer shall constitute evidence of a violation of contract under this section. 9 961018 lac 0031442 if COh~!~ACTOR is found in violation of the nondiscrimination provisions of this Agreement or the applicable affirmative action .g~idelines pertaining to this Agreement, CONTP-ACTOR shall be found in r~aterial breach of this Agreement. Thereupon, CITY shall have =he power to cancel or suspend this .Agreemen=, in whole or in part, or to deduct from =he amottn~ payable to CONTRACTOR ~he sD/~ of Two Hundred Fifty Dollars ($250) for each cale~ar day during which CONTRACTOR is found to have been in such ~oncompliance as damages for breach of contract, or bo~h, This document =eprese=~s the entire ~nd integrated asreement between CITY and CONT~ACTOR and supersedes all prior negotiations, representations, ~nd agreements, either written or oral. This document may be amended only by wrlzten instrument, signed by both C~TY and CONTRACTOR. This A~reement shall be ~verned by the laws of Kh~ S~ate of California. IN WIT~SS WHEREOF, ~he par~ies hereto have executed this Agreement the day and year firs~ above written. CITY OF PALO ALTO City Manager APPROVED AS TO FORM: Senf6r Asst. City A~torney APPROVED: By: City Man~ag e r D~pdty City ~ager, Administrative Services Rigk M~nager - APPROVED AS TO CONTENT: ~irec~or of Human ReSources !0 Attachments : EXHIBIT "A" : EXHIBIT "B" : EXHIBIT "C" : SCOPE OF SERVICES INSURANCE NONDISCRIMINATION COMPLIANCE FORM Ii 961018 lac 0031442 CERTIPICAT~ OF ACKNOWLeDGMEnT (Civil Code ~ 1189) STATE OF California ) COUNTY OF __Contra Costa ..........) On 10/23/96 , .before me, the undersisned, a no~az’y public in ’~d for said County,personally appeared ***PETER J. BROWNe** ..... , ~rso~’ally known ’£"0 ’me- (or proved s~Dscr~ ~o th~ within InS~ent, ~ ac~w~ged to ms he/~ ~cuted the s~ in his/~r authorized capaci~y(~, ~d t~ ~ his/~ sig~ure~ ~n the ins~en~ ~he p~rson(~, or the entity upon ~half o~ which the person(~ ac~ed, executed ~he inst~ent. my hand o~icial seal. COMM. #1010464 12 EXHIBIT A: SCOPE OF SERVICES WORKERS’ COMPENSATION PROGRAM ADMINISTRATION I.INTRODUCTION The City of Palo Alto ("City") is permissible self-insured for Workers’ Compensation in the State of California through a combination of self-insurance (Certificate #7102) and excess coverage. Under this Scope of Services, Athens Administrators ("Athens") shall administer the Workers’ Compensation Program of the City of Palo Alto, related to such obligations in accordance with the terms of this agreement. The intent of these Scope of Services is to insure that the City and Athens agrees on the service levels outlined herein this agreement in an effort to maintain the highest customer service standards to the benefit of the City’s employees. II.GENERAL SERVICES OF ATHENS Athens Agrees: Ao To examine, on behalf of the City, all reports of industrial injury or illness relating to City employees and reported to Athens; Bo To engage the services of person(s) or firm(s) other than Athens, upon approval from the City, for services relating to the investigation and defense of claims, subject to the conditions set forth in this Agreement at the expense of the City; To determine, on behalf of the City, what benefits, if any, should be paid or rendered under the applicable Workers’ Compensation Laws in each reported claim; To pay compensation, medical expenses, "Allocated Loss Expenses," and other benefits as prescribed by law out of funds provided by the City; Eo To maintain a claim file on each reported claim which shah be available to the City at all times for inspection and to conduct, at a time and frequency to be determined by the City, claim file reviews with the City at a location to be determined by the City; Fo To consult with and advise the City on any matter arising in conjunction with the business of the City which involves the subject matter of this Agreement; To provide all necessary forms and supplies for the efficient operation of the Workers’ Compensation Program, including customized checks bearing the City name and seal, and to prepare and file all legally required forms and documents; To insure that the claims examiner shall handle City claims exclusively for the City, shall not be assigned to any other accounts and shall not at any time be assigned a caseload in excess of two-hundred (200) open indemnity claims; To provide the City with computer-generated loss runs, case logs, check registers, risk management reports and any other claim related reports requested by the City, at a frequency to be determined by the City; To provide monthly, a comprehensive claims report as described by the City two weeks or less after the end of the reporting period; To utilize a third party vendor, upon the approval of the City, to review and cost control, all medical, hospital and drug bills and to assist the City with designating industrial medical clinics and hospitals which will provide the City with a preferred provider (PPO) discount at fees less than the Industrial Fees Schedule (IFS), and to provide an itemized list of all medical savings resulting from this program, at a frequency to be determined by the City; To subscribe to and pay on behalf of the City, enrollment in the Index Bureau System on behalf of the City, for workers’ compensation claims in California and to report to the Index Bureau each and every Indemnity claim filed; Mo To provide toll-free "800" telephone numbers for employees of the City to contact Athens regarding questions or concerns regarding claims information; and N.To provide a complete and detailed electronic conversion of all claims data. III.SPECIAL CLAIMS HANDLING SERVICES 1.Athens agrees to provide the following Special Claims Handling Service: To attempt to contact all injured workers within twenty-four (24) hours, and in any event no later than forty-eight (48) hours following the date Athens receives a claim from the City. Follow-up phone contact shall be made with the injured worker every two (2) weeks thereafter provided the injured worker remains off work and unrepresented by council. All telephone contacts must be documented in the claim file; Do Eo To establish Indemnity of Lost Time Claims within five (5) days upon receipt of the Employers First Report of Injury (Form 5020) from the City. The definition of an "Indemnity Claim" shall be an industrial injury or illness claim for which any of the following benefits are claimed: 1.Temporary Disability 2.Permanent Disability 3.Life Pension 4.Death; To confer with the City’s Risk Manager or Safety Officer regarding questions, reports, or issues concerning claims and to assist City department managers and supervisors regarding questions, concerns, or issues involving employee claims; To promptly furnish the Risk Manager or Safety Officer with all required material papers, which consist of but shall not be limited to: Applications and Other Legal Documents Narrative Medical Reports Letters from Defense Counsel Vocational Rehabilitation Reports Private Investigation Reports and Summaries Benefit Notices Delay and/or Denial of Claim Notices; To close Medical Only Claims within twelve (12) months from the date of injury, exceptions to this requirement shall be reported in writing to the City; To submit for approval and closure within five (5) days of receipt of written notice, all undisputed Advisory Ratings; To immediately notify the Risk Manager, by providing a copy of a Reserve Computation Sheet, of any reserve changes over ten-thousand dollars ($10,000.00); To review and obtain approval by Risk Manager of any Claim Denials; To retain a claim settlement authority of five-thousand dollars ($5,000.00) on each claim; J.To confer with the Risk Manager or Safety Officer as conditions arise: To Approve a Vocational Rehabilitation Plan To Refer a claim to a law firm or attorney ToApprove surveillances, subrosas, or other investigations To Obtain settlement authority over five-thousand dollars ($5,000.00); and To provide the City with a check register and a claims and expense report that balances with the monthly loss experience report. These reports will be sent no later than ten (10) days following the end of each month to the Risk Manager. IV.SPECIAL CLAIMS HANDLING SERVICES OF THE CITY The City agrees to provide the following special claims handling services: No To promptly report to Athens all incidents of employee industrial injuries or illnesses; To promptly forward to Athens all applications, reports, notices, or any legal correspondence pertaining to claims administration; To make available to Athens funds for the payment of benefits or services for industrial injuries or illnesses; Do To pay all "Allocated Loss Expenses" defined as: all losses incurred in the adjustment, handling, settlement, or resistance of claims, including litigation expenses; and Eo To pay Athens all service fees as prescribed and included in Exhibit B - Fee Schedule. V.PROGRAM MANAGEMENT A.The Claims Supervisor shall be responsible for the following: 1.Review of all new claims; Review to determine if referral to outside investigation firm is appropriate. Supervisor will document each review whether investigation is conducted or not; o Review to determine if referral to defense counsel is appropriate when any of the following occur: ao Notification of applicant attorney representation Suspected fraud Subrogation Filing of 132A or Serious and Willful Misconduct Need for legal discovery or dispositions, etc Issues that may need to be resolved by the WCAB Claims involving presumptions Claims with incurred value over $25,000 The supervisor will document every claim file in which one or more of the above criteria exists indicating whether or not the claim should be referred to defense counsel and the reasoning for the referral; Oversee the development of the action plan in those cases in which various alternatives may be appropriate. Supervisor will make telephone contact with the City of Palo Alto to communicate the need to consider alternative action plan options and solicit their input and/or concurrence; o Meet with the City of Palo Alto quarterly to review status of specific open claims and report on medical managed care results, feedback, recommendations, etc; and Establish a personal relationship with the primary medical vendors used by the City of Palo Alto and maintain a professional rapport and ongoing communication. B.The Claims Examiner shall adhere to the following three-tier system: Schedule the most appropriate medical treatment utilizing the designated medical scheduling service or authorized physicians: Physical therapy treatment shall only be authorized at facilities located in Palo Alto; o Employees on lost time status shall be returned to modified work status within thirty (30) days; exceptions to this requirement shall be reported in writing to the City; and Employees on modified work status shall be returned to their usual and customary duty status within thirty days; exceptions to this requirement shall be reported in writing to the City. In all cases, the claims examiner must attempt to gain and maintain medical control of cases unless a physician’s statement is on file or a written change in treating physician is provided by the applicant. VI.COST REDUCTION GUARANTY Athens agrees: To guaranty the City of Palo Alto at least a 1:1.25 indemnity closure ratio in each calendar year of service under this contract. If this goal is not attained, Athens will credit the City of Palo Alto $5,000.00 of the annual service fee. To guaranty the City of Palo Alto the reduction of average paid cost claims by at least ten percent (10%) in each calendar year of service under this contract. If this goal is not achieved, Athens will credit the City of Palo Alto $5,000.00 of the annual service fee. VII. PENALTIES Penalties imposed by the Workers’ Compensation Appeals Board (WCAB), the Department of Industrial Relations, the Division of Workers’ Compensation, the Federal Government, or any judicial forum or quasi-judicial forum in the State of California, arising out of the denial of claims shall be the responsibility of the City if imposed as a result of actions taken by Athens at the express direction of the City. Penalties imposed as a result of improper denial of claims shall be the responsibility of Athens if no formal request for denial was obtained by the Risk Manager. Penalties imposed as a result of either party’s failure to comply with the administrative rules, regulations and the Labor Code of the State of California, shall be the responsibility of the culpable party. Athens shall provide the City with a quarterly accounting of all penalties paid by Athens on behalf of the City, including a listing of each penalty payment and the specific claim file to which the penalty payment was charged. Penalties shall be paid out of the City’s benefit account and Athens shall then reimburse the City within thirty days (30) of the issuance of the penalty and fines report, for those penalties and fines which are the responsibility of Athens under the terms and conditions of this agreement. 6 PAR]" II,,,[____~!N£URANCE REC ’:{EMENTS - Lon9 Form City of ’o Alto" SECTION 650, CONTRACTOR: PROJECT MANAGER: CONTRACT NAME: Insurance Requirements for Contractors Sandra Blanch - HR Department Administration of Worker’s Compensatidn Program GENERAL TERMS AND INSTRUCTIONS THIS INSTRUCTION SHEEq" SHOULD BE GIVEN TO YQUR INSURANCE AGENT/BROKER CONTRACTORS TO THE CiTY OF PALO ALTO, AT THEIR SOLE EXPENSE SHALL OBTaiN AND M,~NT.~N INSURANCE FOR THE TERM OF THE CONTRACT CONTRACTORS W]LL BE REQUIRED TO PROWDE A CERTIFICATE EVIDENCING THE INSURANCE AND NAMING THE CITY A.S AN/~3OmONAL INSURED. ALL INSURA,NCE COVERAGE REQUIRED SHALL BE PROVIDED THROUGH CARRIERS V~TH A BEST RATING OF ,&..VII OR HIGHER THAT ARE ADMITTED TO DO BUSINESS IN THE STAT~ OF C..,~tFORNt.~ THE CER"BFICATE OF INSUR..M~iCE MUST BE COMPLETED AND EXECt./’rED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY PROVIDING INSURANCE. FILED ~ THE crr~. ~I~ND ~PROVED BY THE CiTY BEFORE CONTRACT W1LL BE CONSIDERED COMPLETE ~S RESPECTS INSURANCE. RETURN THE COMPLETED CERTIFICATE TO THE CITY OF PALO ALTO, PURCHASING & CONTRACT ADMINISTRATION, 250 HAMILTON AVENUE, ,,PAL,,O ALTO 94301. THE INSURANCE REQUIREMENTS CHECKED BELOW ARE REQUIRED FOR THiS CONTRACT. TYPE OF COVERAGE ~/ Worker’s Compensation I-3 Automobile Liabilit)~ ~ .Comprehensive General Liability: INCLUDING: ¯PERSONAL INJURY ¯BROAD FORM PROPERTY DAMAGE ¯B~M’tK~T CONTRACTUAL ¯FiRE LEGAL LIABILITY ,Comprehensive Automobile Liability: INCLUDING: ¯OWNED " ¯HIRED ¯NON-OWNED Professional Liability: INCLUDING: ¯ERRORS AND OMISSIONS ¯ MALPRACTICE (if Applicabla) ¯ NEGLIGENT PERFORMANCE REQUIREMENT Statutory BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED BODILY INJURY (Each Person) PROPERTY DAMAGE BOOILYINJURY&PROPERTY DAMAGECOMBINED ALL DAMAGES ,THE CITY OF PALO ALT,,0 IS,,TO BE NAMED AS AN ADDITIONAL INSURED D. E. F. The City of PaiD Alto, its officers, agents and employees are named as additional insured, but only as to work performed under contract. Said coverage as to the City of Paid Alto, etc., shall be primary coverage, without offset against City’s existing insurance and any other insurance carded by the City being excess insurance only. Where tf’e wod~ involves grading, paving, excavating, drilling or other underground work, the policy includes destruction of wires, conduits, pipes, mains, ~ other #milar Foperty ~ any apparatus in connection therewith below the surface of the ground whether owned by third parties or the City of Paid Alto. Where the work involves excavating, collapse coverage is provided in the amounts above. The policy includes a "Severability of Interest" provision. Deductibles over $5,000 must be indicated and are subject to approval. If such policies are canceled or changed dudng the period of coverage as stated herein, in such a manner as to affect the Certificate, thirty (30) days written notice will be mailed to the City of Paid Alto, Contract Administration, P.O. Box 10250, 94303 The liability ir~surance p~icy includes a contractual liability endorsement providing insurance coverage for Contractor’s agreement to indemnify the City. The coverage afforded under the policies is subject to all terms of the policies designated herein and meets all of the provisions called for herein. D TE:,CONTRACT ADMINISTRATOR:askins, M, anaqer !4,,~5) 329-2300 , END OF SECTION CITY OF PALO ALTO: Insurance Requirements (REV.6/94)SECTION 00650-1 P. O. ~,ox 10/22/96 D ~l~loyee The~ 43~01001 400708018 10/03/96 10103/97 1/01/97 5106196 5’106/~? $1,000,000 POLICY NUMBER: 4323u1001 COMMERCIAL GENERAL LIABILITY THIS ENDORSEMENT MODIFIES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - OWNERS, LESSEES OR. CONTRACTORS (FORM B) t Thi~ endoraement modifies insurence provided under the following: COMMERCIAL GENERAL LIA~|LITY COVERAGE PART. Name of Person or Org~t;z~on: City of Pale Alto SCHEDULE (If no entry appears above, the information required to complete this endorsement will be shown in the De~lar~iens as eppli~able to this endomement.) W~O IS INSLTRED (Section IZ) is amended to include as an insured the person or organization shown in the Schedule, but only with respect to liability arising out of "your work" for that insured by or for you. ~3G 20 10 11 85 Copyright, Insurance Services Office, Inc., 1984 PRODL’CER A~surt× E & O Direr Commercial Group Ut,,derwriting San Rafael, CA 94911-3200 Athen~ Insurance Service, Inc. dba: Athen.s Adrnir~strators P. O. Box 696 Concord CA 94522 ~ CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY A~N’D CONFER3 NO RIGHTS UIK)N THE CEETIFICATE HOLDER. THIS CERTIFICATE DOKS NOT AMEND. EXTEND OR ALTER THE COVERAGE AFFORDED BYTHE POLICIES BELOW COMPANIF~ AFFORDING COVERAGE COMPANY LR’rTgR .A COMPANY LRTFRR I~ LgTrBR C LE’FrER D COMPANY LETTER E Firemarm Fund Insurance THIS IS TO CERTIFY THAT THX POLICIES OF LNSURANCE LlffFED BELOW HAVE BEEN ISSUED TO TI-iE INSURED NAMED ABOVE FOR TH~ POLICY PERIOD INDICATED. NO’FWTYH3TANDING ANY REQUIREMENT, TERM OR CONDFFION OF ANY CONTRACT OR OTHER DOCUMENT VCITH RF~PEC’F TO ~[ICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCR/BED HEREIN 13 SUILIECT TO ALL THE TERMS, EXCLL~SIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. POLICY NUMBER POLICY EFF.POLICY EXP.LIMITSDATE {MM/DDiYY~DATE (MM/DD/’YY) GENERAL LIA.B 1 L ITY ~. GENERAL LIABILITY CLAIm MADE [’---’]OCC. R’S & CONTRAC"r~J PROT AUTOMOBILE LIABILrrY MXES0344607 5/01/96 5/01/97 GENERAL AGGREGATE PROD-COMPIOP AGG. PERS. & ADV. INJURY EACH OCCURRENCE FIRE DAMAGE(One ~ire) MED. EX~’. {On. COMBINED SINGLE LIMIT BODILY LNffURY (P~ l,.~on) BODILY IN3URY (Per mddmt) PROPERTY DAMAGE AGGREGATE ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: ___~ ffrATUTORY L1MrI~ EACH ACCIDENT DISEASE-POLICY LIMIT DISEASE-EACH EMP. $5,000,0(}0 Ea Claim $5,000,000 Aggr~g. $ 50,000 D~d. DESCRIPTION OF OPERATIONS/LO~ATIONStVEHICLES/SPECIAL rI’RMS City of Palo Alto Purchasing & Contract Admin. 250 Hamilton Avenue SHOULD ANY OFTHE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSULNG COMPANY WILL ENDEAVOR TO MAIL ~ DAYS WRFFFEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESEN’rATIVE~. CERTIFICATION of NONDISCRIMINATION SECTION 410 Administration of Worker’s Compensation Program Certification of Nondiscrimination: As suppliers of goods or services to the City of Palo Alto, the firm and individuals listed below certifies that they do not discriminate in employment with regards to age, race, color, religion, sex, national origin, ancestry, disability, or sexual preference; that they are in compliance with all Federal, State and local directives and executive orders regarding nondiscrimination in employment; and that they agree to demonstrate positively and aggressively the principle of equal opportunity in employment. The Bidder agrees specifically: 1.0 To establish or observe employment policies which affirmatively promote opportunities for minodty persons at all job levels. 2.0 To communicate this policy to all persons concerned, including all employees, outside recruiting services, especially those serving minority communities, and to the minority communities at large. 3.0 To take affirmative action steps to hire minority employees within the organization. 4.0 To be knowledgeable of the local, state, and federal laws and regulations concerning affirmative action policies and provide opportunities for employees. Firm: Athens Administrators DATE: 5/10/96 Title of Officer Signing: vice President Operations Signature Please include any additional information available regarding equal opportunity employment programs now in effect within your company. (Please attach additional pages if necessary) END OF SECTION CITY of PALO ALTO: Non-discrirninatJon (6/94)SECTION 410-1 EOUAL EMPLOYMEN"F OPPORTUNITY The Company is an equal opportunity employer and makes employment decisions on the basis of merit. The Company strives to have the most qualified person in every job. Company policy prohibits unlawful discrimination based on race, color, creed, sex, religion, marital status, age, national origin or ancestry, physical or mental disability, medical condition, sexual orientation, or any other condition made unlawful by federal, state or local laws. All such discrimination is unlawful. The Company is committed to complying with all applicable laws providing equal employment opportunities. This commitment applies to all persons involved in the operations of the Company and prohibits unlawful discrimination by any employee of the Company, including Supervisors and co-workers. To comply with applicable laws ensuring equal employment opportunities to qualified individuals with a disability, the Company will make reasonable accommodations for the known physical or mental limitations of an otherwise qualified individual with a disability who is an applicant or employee unless undue hardship would result. Any applicant or employee who requires an accommodation in order to perform the essential functions of their job should contact a Company representative with day-to-day personnel responsibilities and request such an accommodation. The individual with the disability should specify what accommodation is needed to perform the essential functions of their job. The Company then will conduct an investigation to identify the barriers that make it potentially difficult for the applicant or employee to have an equal opportunity to perform their job. The Company will identify possible accommodations, if any, that will help eliminate the limitation. If the accommodation is reasonable and will not impose an undue hardship, the Company will make the accommodation. If an employee believes they have been subject to any form of unlawful discrimination, the empIoyee should provide a written complaint to their Supervisor, Department Manager or the Vice President - Operations. The complaint should be specific and should include the names of the individuals involved and the names of witnesses. The Company will immediately undertake an effective, thorough and objective investigation and attempt to resolve the situation. If the Company determines that unlawful diserimination has occurred, effective remedial action will be taken commensurate with the severity of the offense. Appropriate action will also be taken to deter any furore discrimination. Whatever action is taken will be made known to the affected employee and the Company will take appropriate action to remedy any loss to the employee as a result of the discrimination. The Company will not retaliate against an employee for filing a complaint and will not knowingly permit retaliation by management, employees or co-workers.