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HR LWP Claims Administration AgreementEXHIBIT A City of San Rafael CLAIMS ADMINISTRATION AGREEMENT THIS AGREEMENT is made as of May 1, 2018 by and between LWP Claims Solutions, Inc., a California corporation located at 35 Miller Ave. # 214, Mill Valley, CA. 94941 ("Claims Administrator"), and the City of San Rafael, a California m u n i c i p a I corporation located at 1400 Fifth Avenue, San Rafael, CA 94901 ("Client" or "City"). RECITALS A. Client desires to contract with a third-party claims administrator to administer the Client's Workers' Compensation Claims. B. Client desires to retain a qualified firm to conduct the services described above. C. Claims Administrator represents to Client that it is a firm composed of highly trained professionals and is fully qualified to conduct the services described above and render advice to Client in connection with said services. D. The parties have negotiated upon the terms pursuant to which Claims Administrator will provide such services and have reduced such terms to writing. ARTICLE 1 -TERM The term of this Agreement shall commence at 12:01 a.m. on the date first written above and shall remain in effect for (3) years, or until this Agreement is terminated in accordance with Article 9 below. This Agreement may be renewed for two successive one (l}-year terms by mutual agreement of the parties no later than thirty (30) days before the expiration of the prior term. Notwithstanding the above, Claims Administrator agrees to begin accepting new claims from Client starting on or about April 16, 2018 in an effort to effectuate a smooth transition of services beginning May 1, 2018. ARTICLE 2 -DEFINITIONS As used in this Agreement, the following terms shall have the following meanings: 2.1 "Allocated Loss Adjustment Expenses": All out-of-pocket expense items pertainingto specific files within the Program, such as reasonable attorneys' fees, medical fee review charges, expert witness fees, fees for independent medical examinations, witnesses' travel expense, extraordinary travel expense incurred by Claims Administrator at the express request of Client, court reporters' fees, transcript fees, the cost of obtaining public records and other similar fees, costs or expenses associated with the investigation, negotiation, settlement or defense of any claim or as required for investigation and pursuit of subrogation -1 1R!GINAL EXHIBIT A on behalf of Client. Allocated loss adjustment expenses shall be subject to and in conformance with all applicable State statutes, laws and regulations. 2.2 "Claim": Any demand for the payment of money arising from an incident or report of an incident occurring during the term of this Agreement within the Program which alleges or results in injury, damage or loss, which could give rise to a demand for the payment of money, in connection with coverage under the applicable Workers' Compensation statute. ARTICLE 3 -SERVICES PROVIDED Subject to all other terms and conditions of this Agreement, Claims Administrator shall provide the following services: 3.1. Claim Adjustment: Review and conduct investigations of all claims reported to Claims Administrator; recommend and perform claims-related services as authorized by Client; attempt to settle claims within the discretionary settlement authority limit; and make recommendations to Client concerning claims which exceed the discretionary settlement authority limit. Administrator shall comply with specified requirements outlined as Addendum III, which is attached hereto and incorporated herein. 3.2 Claim Payment: Pay Claim payments, medical expenses, Allocated Loss Adjustment Expenses and Claim settlements within Claims Administrator's discretionary settlement authority limit, or as otherwise authorized by the Client, from the Claims Payment account funded by Client in accordance with Article 5 of this Agreement. 3.3. Risk Data Management: Collect, process, and store reports containing risk data on Claims handled by Claims Administrator pursuant to this Agreement. Such reports shall be in a format as mutually agreed by the parties hereto and shall be forwarded as directed by the Client. ARTICLE 4 -DISCRETIONARY SETTLEMENT AUTHORITY LIMIT 4.1 Claims Administrator shall be entitled to settle Claims subject to a discretionary settlement authority limit ("DSAL") to be mutually agreed upon during account set up. This amount can then be revised at any time at the sole discretion of the City. 4.2 Claims Administrator shall have full discretion to adjust any Claim to a settlement value which Claims Administrator determines, in its discretion, is equal to or less than the DSAL without supervision or direction from Client. Such adjustment and settlement shall be binding upon Client. 4.3 Claims Administrator shall thoroughly review and investigate any Claims, the settlement value of which Claims Administrator determines to be in excess of its DSAL, and shall make recommendations to Client regarding the final disposition of any such Claim. Client is not bound by Claims Administrator's recommendations and shall determine, in its sole discretion, the final settlement to be paid on such Claims. -2 EXHIBIT A 4.4 Upon prior written notice to Client, Claims Administrator shall have the right to ·treat any Claim, the settlement value of which is within the DSAL, as requiring Client's approval prior to final disposition, adjustment and/or settlement. 4.5 Notwithstanding Sections 4.1 and 4.2, above, Client shall have the right to revoke the discretionary settlement authority granted in this Article with respect to any individual Claim, and may require that such Claim receive Client's approval prior to final disposition, provided that written notice of such revocation is given to Claims Administrator prior to Claims Administrator making any formal commitment with respect to the disposition of such Claim. ARTICLE 5-CLAIMS FUNDING ACCOUNT Client agrees to establish and maintain a claims funding account as described in Addendum II, which is attached hereto and incorporated herein. Addendum II sets forth the check signature authority of the Claims Administrator for the claims funding account. ARTICLE 6-PROPRIETARY AND CONFIDENTIAL RIGHTS 6.1 I n the course of the work performed under this Agreement, either party may make known or furnish its proprietary and/or confidential information to the other party to enable the completion and fulfillment of its obligations hereunder. Both parties specifically agree to keep such proprietary and/or confidential information of the other party confidential and not to disclose such information to any third party, either directly or indirectly, without the priorwritten authorization of the other party. For the purposes of this Agreement, "proprietary and/or confidential information" shall mean all information which is known or maintained by either party, and which relates to matters of the other including, but not limited to, trade secrets, research and development activities, books and records, member/client information and lists, pricing information, knowhow, data, marketing plans, strategies, new products forecasts, financial statements, computer programs and equipment, software, designs, internal reports, procedures and other documentation. 6.2 The restriction contained in Section 6.1 shall not apply to the extent that such information: (a) Becomes available to the public, either directly or indirectly, from a source other than from the other party; (b) Becomes available through software obtained by the other party from a third party without breach of any of the confidentiality obligations set forth in this Agreement; or -3 EXHIBIT A (c) Becomes available in the public domain, or otherwise known to the other party by virtue of information being developed independently by the other party. (d) Information subject to disclosure by state or federal law, including but not limited to the Public Records Act (Cal. Gov. Code section 6250 et seq.) or court order. ARTICLE 7-RELATIONSHIP OF PARTIES 7.1 Client and Claims Administrator are independent contractors in all respects, and as such, neither party shall bind or attempt to bind the other without the other's prior consent or as specifically set forth in this Agreement. Each party is responsible for the acts and omissions of itself, its employees, and representatives. Each party shall indemnify and hold the other party harmless from all liabilities, damages and costs, including reasonable attorneys' fees, resulting from any act or omission made by itself, its employees, agents, and/or representatives (but excluding acts or omissions of Claims Administrator as the agent or representative of Client). In no event shall employees of one party be considered employees of the other party. 7.2 With the prior written approval of Client, Claims Administrator may retain third- party vendors ("Vendors"), including designated managed care services, investigative services and lawyers, as appropriate, to perform claims-related services in connection with the adjustment of any claim referred to Claims Administrator under this Agreement. ARTICLE 8-COMPENSATION Client shall compensate Claims Administrator for services rendered pursuant to this Agreement in accordance with the Fee Schedule attached hereto and incorporated herein as Addendum I. ARTICLE 9-TERMINATION 9.1 This Agreement may be terminated by Client as follows: (a) Upon 90 days' written notice to Claims Administratorfor any reason (b) Upon 10 days' written notice in the event of a material breach of this Agreement by Claims Administratorthat is not cured within thirty (30) days after receipt of written notice of such breach. (c) Immediately upon written notice to Claims Administrator in the event of fraud, gross or willful misconduct by Claims Administrator, or the entry of any insolvency, liquidation, conservation or rehabilitation order by a court against Claims Administrator. 9.2 This Agreement may be terminated by Claims Administrator as follows: (a) Upon 90 days' written notice to Client for any reason; -4 EXHIBIT A (b) Upon 10 days' written notice to Client in the event of a material breach in this Agreement by Client that is not cured within thirty (30) days after receipt of written notice of such breach. (c) Immediately upon written notice to Client in the event of fraud, gross or willful misconduct by Client or the entry of any insolvency, liquidation, conservation or rehabilitation order by a court against Client. (d) Immediately upon written notice to Client in the event of Client's unreasonable failure to fund the Claims Funding Account in a timely manner. 9.3 In the event this Agreement is terminated pursuant to Section 9.1 (a) or Section 9.2(a} above, Claims Administrator shall immediately return all claim files to Client, unless Client elects to have Claims Administrator continue to assume responsibility for handling such claims, for a fee agreed upon by Claims Administrator and Client. This Agreement shall continue to apply to the extent needed for all obligations and liabilities incurred by each party hereunder prior to such termination to be fully performed and discharged by such parties. In the event this Agreement is terminated pursuant to any other provisions of Sections 9.1 or 9.2, it shall terminate on a cut-off basis and Claims Administrator shall have neither the right nor the obligation to continue to administer Claims. 9.4 Upon termination of this Agreement, Client shall have the continuing right to take immediate possession of all Claims files and other records relating to such Claims for which Claims Administrator does not have any further obligations pursuant to this Agreement. In the event Client takes over handling of any or all outstanding claims after termination, Claims Administrator agrees to cooperate fully with Client and to instruct its employees and agents to cooperate fully with Client in connection with Client's handling of such claims. In conjunction with any termination of this Agreement, Claims Administrator agrees to provide a data file, in a form suitable to Client, of all payment, reserve, medical and all other pertinent Claim file information contained within the computer system of Claims Administrator, its subsidiaries, data warehouse or any other off-site on on-site media storage facility. 9.5 Within thirty (30) days after the effective date of the termination of this Agreement, Claims Administrator shall furnish Client with a final reconciliation of Client's funds in the Account, and any payment shown to be due will be made by the responsible party within thirty (30) days of the date of such reconciliation. ARTICLE 10 -AUDIT RIGHTS Upon reasonable notice, Claims Administrator shall permit authorized employees and representatives of Client (including, without limitation, Program Administrator) to review the operations and claims handling of Claims Administrator, both at its places of -5 EXHIBIT A business and in the field, in order to evaluate the quality and accuracy of Claims Administrator's employees and operations. ARTICLE 11 -INDEMNITY AND INSURANCE 11.1 Claims Administrator agrees to indemnify, defend and hold harmless Client and its affiliates, directors, officers, attorneys, insurers, directors, agents and employees from and against any and all liability, loss, damage or expense, including reasonable attorneys' fees, incurred in connection with claims or demands for damages arising from or caused by any negligence, recklessness, or willful misconduct of Claims Administrator or its officers, agents, or employees, unless such act or omission was undertaken at the express direction of Client. 11.2 Client agrees to indemnify, defend and hold harmless Claims Administrator and its affiliates, directors, officers, attorneys, insurers, agents and employees from and against any and all liability, loss, damage or expense, including reasonable attorneys' fees, incurred in connection with claims or demands for damages arising from or caused by any negligence, recklessness, or willful misconduct of Client or its officers, agents, or employees, unless such act or omission was undertaken at the express direction of Claims Administrator. 11.3 Claims Administrator shall, at all times while any obligation under this Agreement remains to be performed by Claims Administrator, maintain in force and effect such insurance as is normal and customary or otherwise required by law to fully protect itself, its clients and Client including, as a minimum: (a) Workers' Compensation Insurance, as required by the State of California, with statutory limits, and employer's liability insurance with limits of no less than one million dollars ($1,000,000) per accident for bodily injury or disease. Claims Administrator's worker's compensation insurance shall be specifically endorsed to waive any right of subrogation against Client; (b) Commercial General Liability Insurance with limits of not less than $1 million per claim and $3 million in the aggregate, including, without limitation, contractual liability and personal injury for libel, slander and assault, insuring Claims Administrator's services under this Agreement and naming Client as additional insured (with any per occurrence deductible not to exceed $50,000); (c) The additional insured coverage under Claims Administrator's insurance policies shall be primary with respect to any insurance or coverage maintained by Client and shall not call upon Client's insurance or self-insurance coverage for any contribution. The "primary and noncontributory" coverage in Claims Administrator's policies shall be at least as broad as ISO form CG20 01 04 13. (d) An Errors and Omissions policy providing coverage in the amount of not less than $1,000,000, with a per occurrence deductible not to exceed $50,000; and, -6 EXHIBIT A (e) A Fidelity bond or insurance providing coverage for all officers and other employees of Claims Administrator (including "money and securities" coverage) in the amount not less than $1 million, with a deductible not to exceed $50,000. (f) Upon request of Client, Claims Administrator will provide certificates of insurance evidencing the above minimum specified insurance coverages. (g) Claims Administrator will notify Client in writing sixty days prior to cancellation or reduction in the above insurance coverages. (h) Except for professional liability insurance or worker's compensation insurance, the insurance policies shall include, in their text or by endorsement, coverage for contractual liability and personal injury. (i) By execution of this Agreement, Claims Administrator hereby grants to Client a waiver of any right to subrogation which any insurer of Claims Administrator may acquire against Client by virtue of the payment of any loss under such insurance. Claims Administrator agrees to obtain any endorsement that may be necessary to effect this waiver of subrogation, but this provision applies regardless of whether or not Client has received a waiver of subrogation endorsement from the insurer. (j) The insurance policies shall provide for a retroactive date of placement coinciding with the effective date of this Agreement. (k) It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be available to Client or any other additional insured party. Furthermore, the requirements for coverage and limits shall be: (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured; whichever is greater. (I) Proof of Insurance. Claims Administrator shall provide to Client's City Attorney all of the following: (1) Certificates of Insurance evidencing the insurance coverage required in this Agreement; (2) a copy of the policy declaration page and/or endorsement page listing all policy endorsements for the commercial general liability policy, and (3) excerpts of policy language or specific endorsements evidencing the other insurance requirements set forth in this Agreement. Client reserves the right to obtain a full certified copy of any insurance policy and endorsements from Claims Administrator. Failure to exercise this right shall not constitute a waiver of the right to exercise it later. The insurance shall be approved as to form and sufficiency by the City Attorney. -7 EXHIBIT A ARTICLE 12 -GENERAL PROVISIONS 12.1 This Agreement sets forth the entire understanding of the parties and supersedes any prior agreement or understanding relating to the subject matter hereof. No amendment of this Agreement shall be binding unless executed in writing by both parties. No waiver of any provision of this Agreement shall be deemed a waiver of any other provision or a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver. 12.2 Except as otherwise provided herein, this Agreement shall inure to the benefit of and be binding upon the parties' permitted successors and assignees. 12.3 This Agreement shall be governed by and construed in accordance with California law. If any provision of this Agreement is held by a court of competent jurisdiction to be unenforceable in California, the balance of this Agreement shall remain in full force and effect. 12.4 Each notice or other communication referred to in this Agreement shall be given in writing by personal delivery, by a nationwide overnight service such as Federal Express, or by United States first class mail, postage prepaid, at the designated address set forth below or at such other address as such party, by notice to the other party, may designate from time to time: If to Client: Stacey Peterson, Director of Human Resources City of San Rafael 1400 Fifth Avenue San Rafael, CA 94901 Telephone (415) 485-3069 If to Claims Administrator: Judy Adlam, President & CEO LWP Claims Solutions, Inc . 35 Miller Ave. # 214 Mill Valley, Ca. 94941 Telephone: (415) 384-0370 12.5 Neither party may assign its rights or responsibilities under this Agreement without the prior written consent of the other party. 12.6 If a dispute arises under this Agreement, the substantially prevailing party shall be entitled to reasonable attorneys' fees and costs. -8 EXHIBIT A 12.7 NONDISCRIMINATION Claims Administrator shall not discriminate, in any way, against any person on the basis of age, sex, race, color, religion, ancestry, national origin or disability in connection with or related to the performance of its duties and obligations under this Agreement. 12.8 COMPLIANCE WITH ALL LAWS Claims Administrator shall observe and comply with all applicable federal, state and local laws, ordinances, codes and regulations, in the performance of its duties and obligations under this Agreement. Claims Administrator shall perform all services under this Agreement in accordance with these laws, ordinances, codes and regulations. Claims Administrator shall release, defend, indemnify and hold harmless Client, its officers, agents and employees from any and all damages, liabilities, penalties, fines and all other consequences from any noncompliance or violation of any laws, ordinances, codes or regulations. 12.9 COSTS AND ATTORNEY'S FEES The prevailing party in any action brought to enforce the terms and conditions of this Agreement, or arising out of the performance of this Agreement, may recover its reasonable costs (including claims administration) and attorney's fees expended in connection with such action. 12.10 CITY BUSINESS LICENSE / OTHER TAXES Claims Administrator shall obtain and maintain during the duration of this Agreement, a CITY business license as required by the San Rafael Municipal Code. Claims Administrator shall pay any and all state and federal taxes and any other applicable taxes. Client shall not be required to pay for any work performed under this Agreement, until Claims Administrator has provided Client with a completed Internal Revenue Service Form W-9 (Request for Taxpayer Identification Number and Certification). 12.11 APPLICABLE LAW The laws of the State of California shall govern this Agreement. -9 EXHIBIT A IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have executed this Agreement on the day and year first above written. LWP Claims Solutions, Inc. City of San Rafael BY BY TITLE President & CEO TITLE City Manager DATE DATE ATTEST Lindsay Lara, City Clerk PROVED AS TO FORM: ~ M JVl,i}t~~ ft-iZ~f, ~'f"k -10 EXHIBIT A ADDENDUM I FEE SCHEDULE 1. In consideration of the services to be provided hereunder, Client agrees to pay Claims Administrator service fees as follows: Proposed Pricing Flat Fee Annual - 1 Partially Dedicated Sr Examiner and 1 Partially Dedication FM/MO Examiner Year 1 Year2 Year3 Year 4 (Optional) Year 5 (Optional) Services Included in Claims Administration Fee Claims Administration On-Line System Access Loss Reporting Access to Ad Hoc Reporting On-Line 5020 Reporting Preparation of SIP Reports Claim Review Meetings $172,000 $176,300 $180,708 $185,225 $189,856 Designated Account Manager Litigation Management Trust Accounting Preparation and filing of 1099's Reporting to Excess Carriers Subrogation Swat Team Claim Intake Bill Review Fee Standard Medical Bill Review Fee Schedule Reductions Inpatient hospital and Ambulatory Surgery Center PPO Reduction Bills not subject to Fee Schedule $8.00 per bill plus PPO Reduction $300 per bill plus PPO Reduction 24% of Reduction below Fee Schedule 24% of Reduction Should Hospitollnpotient and Ambulotory Surgery Center charges be less thon $300 the standard bill review fee and PPO network discount shall apply. Other Fees RMIS Access Transition Services Data Intake -11 No Charge $5,000 EXHIBIT A Claims Triage Ebill Index and OFAC Reporting (ISO Fee passed through) Bank Fees Storage Fee Optional Managed Care Programs Case Management Telephonic Case Management Field Case Management Utilization Review Tier 1-Nurse Review No Charge $1 per bill (if submitted by provider through clearinghouse) $9.75 per report Actual bank fees will be the responsibility of the client No Charge $102 per hour $108 per hour + incidentals (including mileage, phone, tolls, parking, etc.) $110 Flat Fee Includes 3 medical request in a single review, set up, phane calls ta physician, email natices ta adjuster and letters ta all parties including netwark providers. Fee applies ta reviews approved by nurse or escalated to physician. Tier 2 -Physician Review $235 plus nurse charge Includes 3 medical request in a single review. Pharmacy Review $385 plus nurse charge Includes unlimited medical request in a single review. PPO fee for savings below fee schedule and negotiations 24% There is no separate charge for medical provider access to L WP's proprietary network. Percentage of savings below fee schedule is the only charge. I Medicare Reporting I Investigation Field Investigation SIU related work I Managed Care Provider Feeds Applies to feeds which LWP does not already maintain -12 No Charge $88 per hour $98 per hour $3,000 EXHIBIT A I Other Charges Liens Negotiated by LWP Staff 10% of savings achieved below fee schedule LWP makes every effort not to change pricing. Pricing guarantee for 18 months. Price subject to increase thereafter with advance notice. 1. Services fees shall be paid no later than thirty (30) days after being submitted to Client for payment along with full documentation of such fees. 2. Client agrees to reimburse Claims Administratorfor reasonable processing costs and out-of-pocket expenses incurred by Claims Administrator in the performance of its services hereunder. Such reimbursementshall be paid within thirty (30) days of receipt of an invoice outlining and fully documenting such reasonable expenses. Costs not outlined elsewhere in this contract require the prior written approval of Client as a condition for reimbursement. 3. Any fees not paid within thirty (30) days shall be subject to interest at a rate of six (6%) percent per annum. -13 EXHIBIT A ADDENDUM II CLAIMS FUNDING ACCOUNT The Claims Funding Account (the "Account") shall be funded as follows: Signature Authority LWP has discretionary authority to name officers, directors or other management staff as signers on this account. Frequency and method of Funding LWP will check funds weekly, and request total amounts paid reconciling to agreed upon Claims Funding Account balance of $125,000. Special funds will be requested for any single payment exceeding $20,000 the Claims Funding Account balance will be monitored and adjusted by mutual agreement between LWP and Client, as needed, in the spirit of ensuring that claim payments are made timely. Credits and Recoveries Any monies collected by Claims Administrator for subrogation, from second or special injury funds, as reimbursements of paid claim expenses, excess insurance recoveries, or any other type of recovery shall be applied to the claim file and promptly deposited by Claims Administrator into the Claims Funding Account and reconciled to the agreed upon account balance. Misc. Provisions None -14 EXHIBIT A ADDENDUM III SPECIAL HANDLING AND REPORTING REQUIREMENTS <To Be Determined> CONTRACT ROUTING FORM INSTRUCTIONS: Use this cover sheet to circulate all contracts for review and approval in the order shown below. TO BE COMPLETED BY INITIATING DEPARTMENT PROJECT MANAGER: Contracting Department: Human Resources Project Manager: Stacey Peterson Extension: 3069 Contractor Name: LWP Claims Solutions, Inc. Contractor's Contact: Judy Adlam Contact's Email: iadlam@lwpclaims.com D FPPC: Check if Contractor/Consultant must file Form 700 Step RESPONSIBLE DESCRIPTION DEPARTMENT 1 Project Manager a. Email PINS Introductory Notice to Contractor b. Email contract (in Word) & attachments to City Atty c/o Laraine.Gittens@cityofsanrafael.org 2 City Attorney a. Review, revise, and comment on draft agreement and return to Project Manager b. Confirm insurance requirements, create Job on PINS, send PINS insurance notice to contractor 3 Project Manager Forward three (3) originals of final agreement to contractor for their signature 4 Project Manager When necessary, * contractor-signed agreement agendized for Council approval ·PSA> $20,000; or Purchase> $35,000; or Public Works Contract> $125,000 Date of Council approval PRINT CONTINUE ROUTING PROCESS WITH HARD COPY 5 Project Manager Forward signed original agreements to City Attorney with printed copy of this routing form 6 City Attorney Review and approve hard copy of signed agreement 7 City Attorney Review and approve insurance in PINS, and bonds (for Public Works Contracts) 8 City Manager / Mayor Agreement executed by Council authorized official 9 City Clerk Attest signatures, retains original agreement and forwards copies to Project Manager COMPLETED DATE 3/26/2018 3/8/2018 3/22/2018 ClIck here to enter a date. /' N/A Or 'ff,t~'llt 1] \\\1 C; l l~ s---i f S/t-/I'b REVIEWER Check/Initial IZI LAG IZI LAG IZI D D D \;1t 'lJ\ \Mu- ~~ \J cX-bL