HomeMy WebLinkAbout2003-06-23 City Council (13)C ty Manager’s Report
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TO:HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT: HUMAN RESOURCES
DATE:JUNE 23, 2003 CMR: 326:03
SUBJECT:APPROVAL OF CONTRACT WITH ATHENS ADMINISTRATORS
IN THE AMOUNT OF $178,500 FOR ONE YEAR FOR WORKERS’
COMPENSATION CLAIMS ADMINISTRATION SERVICES
RECOMSIENDATION
Staff recommends that Council:
Approve and authorize the Mayor to execute a contract with Athens
Administrators in the amount of $178,500 for one year to provide workers’
compensation claims administration services.
Authorize the City Manager or designee to exercise the option to renew the
contract for up to two additional one-year terms, provided Athens is
responsive to the City’s needs and the quality of its work is acceptable.
DISCUSSION
Project Description
The work to be performed under the contract is for claims administration services for the
City’s Workers’ Compensation Program. These services include the processing of all
workers’ compensation claims in accordance with applicable Labor Code regulations;
engaging services related to the investigation and defense of claims, as well as engaging
the services of appropriate medical providers, determining what benefits, if any, should
be paid, and handling all the necessary forms in each reported claim, all in a timely
manner as required under the workers’ compensation laws.
CMR: 326:03 Page 1 of 3
Selection Process
Staff sent a request for proposals to five firms on April 24, 2003. The proposal period
was 21 days. A total of 3 firms submitted proposals: Athens Administrators, Claims
Management Inc., and United Risk Management. The proposals ranged as follows:
United Risk Management
Athens Administrators
Claims Management, Inc.
$119,500
$178,500
$182,500
A selection advisory committee consisting of Human Resources staff and a claims auditor
reviewed the proposals. The committee carefully reviewed each firm’s qualifications and
submittal in response to the RFP relative to the following criteria:
~’Public agency experience, specifically with LC 4850 public safety officers benefits
[]Stability of ownership and experience
=Choice of bill review services and preferred provider networks
[]Ability to provide innovative progams and services
=Customer service capability
Bill review services include the review and cost control of all medical, hospital and drug
bills to ensure that the bills are being invoiced at the correct fee or discounted rate.
Labor Code 4850 provides injured public safety employees with salary continuation up to
one year in lieu of temporary disability and requires additional handling and knowledge.
Athens Administrators was selected because it has demonstrated over the past 9 years its
ability to provide a high level of quality, service and results in its claims administration
services. Athens continues to strive to provide innovative programs and effective
medical cost containment services. The staff at Athens is responsive to the City’s needs
and has assisted the City in significantly reducing its claims costs even while the industry
continues to experience rising medical and administrative costs each year.
Athens Administrators has proposed a fee of $178,500, the same fee as in the third year
of the last contract. If the City exercises its option to renew the contract for an additional
term or terms, a fee increase, not to exceed the increase in the Consumer Price Index for
the San Francisco Bay Area, will be negotiated.
RESOURCE IMPACT
Funding for this ageement is provided in the 2003-05 budget.
CMR: 326:03 Page 2 of 3
POLICY IMPLICATIONS
This request does not contain any policy implications.
ENVIRONMENTAL REVIEW
This is not a project under the California Environmental Quality Act (CEQA).
ATTACHMENTS
A~eement Between the City of Palo Alto and Athens Administrators
Compensation Administration Services.
PREPARED BY: Sandra T.R. Blanch, Risk & Benefits Manager
DEPARTMENT HEAD:
Leslie Loomis
Director of Human Resources
CITY MANAGER APPROVAL:
Emily
Assistant City Manager
for Workers’
CMR: 326:03 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
, 2003, by and between the CITY OF PAL0 ALTO,
a municipal corporation of California, hereinafter referred to as
"CITY," and ATHENS ADMINISTRATORS (Taxpayer Identification Number
94-2448663), 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 TNE S SETH:
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 mutual
covenants, the parties hereto agree as follows:
SECTION i - DEFINITIONS
i.i CITY
The term "CITY" shal! 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 R!SKAND BENEFITS IIANAGER
The term "Risk and Benefits Manager" shall mean the duly
appointed Risk Manager of the City of Pa!o Alto, California, or his
or her designated representative.
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1.4 PROJECT
The term "Project~ shal! mean the services described in
E~hibit "A", entitled ~Scope of Services," attached hereto and made
a part hereof by this reference.
SECTION 2 - PROJECT COORDINATION
2.1 CITY
The City Manager shal! be representative of CITY for all
purposes under this Agreement. Sandra Blanch, the Risk and
Benefits Manager, is designated as the Project Manager for the City
Manager, and she sha!l 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 shal! be subject to
the prior written approval of the Project Manager. A Senior
Examiner will be assigned by CONTRACTOR for this Agreement, and
shal! work exclusively on this Agreement. The examiner sha!l be
supervised by Jan Ramaciotti.
SECT!ON 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 lawfu! 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
emp!oyed under this Agreement, any materials used in CONTRACTOR’s
performance under this Agreement, or the performance of the
services under this Agreement;
030619 cl 8120352
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
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 C!TY 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 shal! 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 emp!oyees of the firm are licensed by the State
of California and that the services to be provided under this
Agreement wil! 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
Emp!oyment 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 wil! be effected
pursuant to the terms of this Agreement.
030619 cl 8120352
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 Seventy-Eight Thousand Five Hundred Dollars ($178,5000,
payable in twelve equal monthly billings of Fourteen Thousand Eight
Hundred Seventy-Five Dollars ($14,875). Each monthly payment shal!
be made within thirty (30) days of receipt by CITY of a properly
supported invoice, provided by CONT~hCTOR, in triplicate, mailed to
the City of Palo Alto, Attn: Risk and Benefits Manager, 250
Hamilton Avenue, Palo Alto, CA.
Any additional services for which additional fees
would be payable shal! be negotiated by the parties outside the
scope of this Agreement, and shall be subject to approval of the
City Council.
In the event this Agreement is renewed for any
additional one year term, CITY shall pay CONTRACTOR an amount to be
negotiated by the parties, and not to exceed the change in the
Consumer Price Index for al! Urban Consumers (San Francisco-
0akland-San Jose, CA) over the previous one year term.
SECTION 5 - TERM
This Agreement shall commence on July i, 2003, and shall
continue for one (i) year. This Agreement may be renewed on an
annual basis, for a tota! term not to exceed three (3) years, to
expire no later than June 30, 2006. Each annual renewal hereof
shall be subject to the City Council’s continued annual
appropriation of sufficient funds for this Agreement and the mutua!
agreement between the parties to renew the Agreement for an
additional year. The City Manager is hereby authorized on behalf
of CITY to agree to renew the contract for a second and third year
upon the Manager’s determination that renewal is in the best
interest of the CITY.
If the parties desire to negotiate additional yearly
renewals as~authorized by this section, the parties shal! commence
negotiations for each successive annual term beginning 60 days
prior to the end of the then current annua! term. Agreement for
each successive annua! term shall be concluded at least thirty (30)
days prior to the end of the then current annual term.
030619 cl 8120352
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 thirty (30) 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 substantia! failure of
performance by C!TY 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
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 al! 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 shal! become the permanent property of CITY.
7.4 FINAL ACCOUNTING
Upon any cancellation or termination of this Agreement,
CONTRACTOR shal! make a final accounting of all fees payable to
CONTRACTOR hereunder and a final accounting of any funds be!onging
to CITY then in the possession of CONTRACTOR, and any balance due
either party shall be paid to the party entitled thereto no later
030619 cl 8120352
than forty-five (45) days fol!owing 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 - ASSIGNMENT; PERSONAL SERVICES; SUBCONTRACTORS
AND EMPLOYEES
9.1 ASSIGNMENT
Both parties shall give their personal attention to the
faithful performance of this Agreement and shal! 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 shal! not be
assignable by operation of law without the prior written consent of
the other party.
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 shal! 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 contro!. If any emp!oyee or subcontractor of CONTRACTOR fails
030619 cl 8120352
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 shal! be discharged immediately from the
work under this Agreement on demand of the Project Manager.
SECTION i0 -NOTICES
Al! notices hereunder shal! 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 emp!oyed. CONTRACTOR certifies that no one who
has or wil! have any financial interest under this Agreement is an
officer or employee of CITY. It is expressly agreed that in the
performance of the professiona! services required under this
Agreement, CONTRACTOR, and any of its subcontractors or employees,
shall at al! times be considered independent contractors and not
agents or emp!oyees of CITY.
SECTION 12 -INDEMNITY
CONTRACTOR agrees to protect, indemnify, defend and hold
harmless CITY, its Counci! 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 !oss, caused by or arising out of CONTRACTOR’s, its
officers’, agents’, subcontractors’ or employees’ negligent acts,
errors, or omissions, or wi!lful 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.
030619 cl 8120352
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 em_m!oyer 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 -INSURANCE
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, ~ut also, with
the exception of workers’ compensation, emp!oyer’s liability, and
professiona! liability insurance, naming as additional insureds
CITY, its Council members, officers, agents and employees, and each
of them, concerning this Agreement and the Project.
Al! insurance coverage required hereunder shall be
provided through carriers with a Best rating of A:VII or higher
that are admitted to do business in the State of California. ~y
and all subcontractors of C0NT_RACTOR 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 and Benefits Manager and shall contain an
endorsement stating that the insurance is primary coverage and wil!
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
as an additional insured except in policies of workers’
compensation, emp!oyer’s liability, and professiona! 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.
030619 cl 8120352
14.3 NO L!H!T 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 indeKanification provision and
requirements of this Agreement under Section 13 hereof.
Notwithstanding said policy or policies of insurance, CONTRACTOR
shal! 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.
030619 cl 8120352
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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 shal! be made in the emp!oyment of
persons under this Agreement because of the age, race, color,
national origin, ancestry, religion, disability, sexua! 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 Hunicipal Code pertaining to
nondiscrimination in emp!oyment, 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 Federa! and
State of California laws covering
nondiscrimination in employment; 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 DISCRIHINATION
If CONTRACTOR is found in violation of the
nondiscrimination provisions of the State of California Fair
Emp!oyment Practices Act or similar provisions of federal law or
executive order in the performance of this Agreement, it shal!
thereby be found in material breach of this Agreement. Thereupon,
CITY shall have the power to cance! 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. 0nly a
finding of the State of California Fair Employment Practices
Commission or the equivalent federa! agency or officer shall
constitute evidence of a violation of contract under this section.
030619 cl 8120352
!0
SECTION 21 - AGREEMENT CONTAINS ALL UNDERSTANDINGS;
~ENDMENT
This document represents the entire and integrated
agreement between CITY and CONTRACTOR and supersedes all prior
negotiations, representations, and agreements, either written or
ora!. This document may be amended only by written instrument,
signed by both CITY and CONTRACTOR.
SECTION 22. NONAPPROPRIATION CLAUSE
This Contract is subject to the fiscal provisions of the
Charter of the City of Palo Alto and the Palo Alto Municipal Code.
This Contract wil! terminate without any penalty (a) at the end of
any fisca! year in the event that funds are not appropriated for
the following fiscal year, or (b) at any time within a fiscal year
in the event that funds are only appropriated for a portion of the
fiscal year and funds for this Contract are no longer available.
This Section shall take precedence in the event of a conflict with
any other covenant, term, condition,or provision -of this
Contract.
SECTION 23 - GOVERNING LAW
This Agreement shall be governed by the laws of the State
of California.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement the day and year first above written.
ATTEST:CITY OF PALO ALTO
City Clerk Mayor
APPROVED AS TO FORM:ATHENS ADMINISTRATORS
Senior Asst. City Attorney By:
Name:
Title:
By:
Name:
Title:
Taxpayer Identification No.
APPROVED:
Assistant City Manager
Director of Administrative
Services
Director of Human Resources
Insurance Review
Attachments:
EXHIBIT "A":
EXHIBIT "B":
EXHIBIT "C":
(Compliance with Corp. Code § 313 is
required if the entity on whose behalf
this contract is signed is a corporation.
In the alternative, a certified corporate
resolution attesting to the signatory
authority of the individuals signing in
their respective capacities-is acceptable)
SCOPE OF PROJECT & TIME SCHEDULE
INSURANCE
NONDISCRIMINATION COMPLIANCE FORM
030619 cl 8120352
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CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF )
COUNTY OF )
On 2003, before me, the
undersigned, a Notary Public in and for said County and State,
personally appeared ,
personally known to me or proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed
the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the
instrument.
WITNESS my hand and officia! seal.
Signature of Notary Public
030619 cl 8120352
13
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF
COUNTY OF
SS.
On , 2003, before me, the
undersigned, a Notary Public !n and for said County and State,
personally appeared ,
personally known to me or proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed
the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the
instrument.
WITNESS my hand and official seal.
Signature of Notary Public
030619 cl 8120352
in_
EXH/BIT A:SCOPE OF SERVICES
WORKERS’ COMPENSATION PROGRAM ADMINISTRATION
I.INTRODUCTION
The City of Palo Alto (A 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:
To examine, on behalf of the City, all reports of industrial injury or illness relating
to City employees and reported to Athens;
No 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;
Co 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;
Do To pay compensation, medical expenses, Allocated Loss Expenses, and other benefits
as prescribed by law out of funds provided by the City;
go To maintain a claim file on each reported claim which shall 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;
F.To aggressively handle subrogation claims;
No
No
Oo
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 al! 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 (165) open indemnity claims. In addition, the City
of Palo Alto shall retain the right to participate in the selection of the senior and
assistant examiners assigned to the account;
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 drag 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;
To provide toll-free "800" telephone numbers for employees of the City to contact
Athens regarding questions or concerns regarding claims information; and
To provide a complete and detailed electronic conversion of all claims data.
III.SPECIAL CLAIMS HANDLING SERVICES
Athens agrees to provide the following Special Claims Handling Service:
No 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;
go 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;
C°To immediately notify the Risk Manager, by providing a copy of a Reserve
Computation Sheet, of any reserve changes over twenty-thousand dollars
($20,000.00);
D.To review and obtain approval by Risk Manager of any Claim Denials;
Eo 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;
F.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
To approve surveillances, subrosas, or other investigations
To obtain settlement authority over fifteen-thousand dollars ($15,000.00);
G.To promptly acknowledge receipt of voicemail and email messages;
No To consistently maintain a high level of customer service with City staff and injured
employees;
Jo
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 submit for approval and closure within five (5) days of receipt of written notice,
all undisputed Advisory Ratings; 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 agees to provide the following special claims handling services:
A.To promptly report to Athens all incidents of employee industrial injuries or illnesses;
B.To promptly forward to Athens all applications, reports, notices, or any legal
correspondence pertaining to claims administration;
C.To make available to Athens funds for the payment of benefits or services for
industrial injuries or illnesses;
D.To pay all Allocated Loss Expenses defined as: all losses incurred in the adjustment,
handling, settlement, or resistance of claims, including litigation expenses; and
E.To pay Athens all service fees as prescribed and included in Exhibit B - Fee
Schedule.
4
PROGRAM MANAGEMENT
No 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:
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 contact the City of Palo Alto by
telephone or email to communicate the need to consider alternative action plan
options and solicit their input and/or concurrence;
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
o Establish a personal relationship with the primary medical vendors used by the City
of Palo Alto and maintain a professional rapport and ongoing communication.
5
B.The Senior Claims Examiner shall be responsible for the following:
To make initial contact with all injured workers by telephone within twenty-four (24)
hours (and in any event no later than forty-ei~dht (48) hours following the date Athens
receives aia indemnity claim from the City to explain benefits and obtain medical
history, prior workers’ compensation claim information and. any other pertinent
information. Fol!ow-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;
o To contact injured workers by telephone when any of the following occurs, unless the
injured worker is represented:
a. explain the delay process when claims are placed on delay;
b. explain the reason for denial when a claim is denied;
c. explain permanent and stationary findings, permanent disability and ratings;
3.To contact the City on delay claims to determine action plan;
4.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:
1. Physical therapy treatment shall only be authorized at facilities located in
Palo Alto;
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.
6
COST REDUCTION GUARANTEE
Athens agrees:
To guarantee the City of Palo Alto at least a 1:1 indemnity closure ratio in each
calendar year of service under this contract. K this goal is not attained, Athens will
credit the City of Palo Alto $5,000.00 of the annual service fee.
To guarantee the City of Palo Alto that at least 32% of the indemnity claims reported
during service year will be closed by the end of the service year. K this goal is not
attained, 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.
7
Exhibit
-~ ~,OOO,O00
city of Pmlo Alto
Contract Administra~-on250 ,qami!ton Avenue
Palo Alto CA 94301
CERTIFICATION OF NONDISCRIMINATION
Exhibit "C"
Certification of Nondiscrimination
SECTION 410
As suppliers of goods or services to the City of Palo Alto, the firm and individuals listed below hereby certify:
a.)that they are currently in compliance with all federal and state of California laws covering
nondiscrimination in employment; and
b)that, if awarded the contract, the proposer will not discriminate in employment of any person
under the contract because of race, color, national origin or ancestry, religion, disability, gender
or marital status of such person.
THE INFORMATION HEREIN IS CERTIFIED CORRECT BY SIGNATURE(S) BELOW.
Firm:
Signature:
Name:
Sig-nature:
Name:
~ote;
A~,//~_...~s Administrators
Peter J. Brown
(PRINT OR TYPE NAME)
Michael Leonard
(PPdNT OR TYPE NAME)
California Corporations Code Section 313 requires two corporate officers to execute contracts.
The signature of First Officer must be one of the following: Chairman of the Board;
President; or Vice President.
** The signature of the Second Officer** must be on of the following: Secretary;
Assistant Secretary; Chief Financial Officer; or Assistant Treasurer.
(In the alternative, a certified corporate resolution attesting to the sig-natory authority of
the individuals signing in their respective capacities is acceptable)
CITY OF PALO ALTO RFP NO. 151689 PAGE 1 OF 1