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HomeMy WebLinkAboutAIMS (Acclimation Insurance Management Services) - 2018-11-01AMVE-b 7-0 City of Huntington Beach File #: 18-482 MEETING DATE: 12/17/2018 REQUEST FOR CITY COUNCIL ACTION SUBMITTED TO: Honorable Mayor and City Council Members SUBMITTED BY: Fred A. Wilson, City Manager PREPARED BY: Michele Warren, Director of Human Resources Subject: Approve and authorize execution of a Professional Services Contract for Workers' Compensation Third -Party Claims Administration with AIMS (Acclamation Insurance Management Services) in the amount of $1,340,073 as contained in the Workers' Compensation Internal Services Fund (55131001-69410) Statement of Issue: The City of Huntington Beach issued a Request for Proposals (RFP) for Third -Party Administration of its Workers' Compensation program. The RFP review and evaluation process awarded AIMS the highest review score for workers' compensation program claims administration, and staff recommends AIMS be granted a three-year contract as the most responsive bidder. Financial Impact: Funding for the implementation of the fiscal items contained in the professional services agreement will come from the Workers' Compensation Internal Services Fund (55131001.69415). The three- year not to exceed contract amount is $1,340,073. Adequate funds are available in FY 2018/19 to cover the remaining part of the fiscal year. No additional appropriation is required. No additional appropriation is required. Future fiscal years will be budgeted accordingly. Recommended Action: Approve and authorize the Mayor and City Clerk to execute "Professional Services Contract Between the City of Huntington Beach and Acclamation Insurance Management Services (AIMS) for Workers' Compensation Third Party Administration" for a period of three (3) contract years; and, authorize the City Manager to execute the Contract and Related Documents. Alternative Action(s): Do not approve the professional services agreement and direct staff to issue another RFP for third - party claims administration of the workers' compensation program. Analysis: The City of Huntington Beach is required by law to provide Workers' Compensation benefits to City of Huntington Beach Page 1 of 3 Printed on 12/12/2018 144 powered oy LegistarW File #: 18-482 MEETING DATE: 12/17/2018 employees. In the past, the City employed full-time staff to assist in the administration of the City's more than 475 open Workers' Compensation claims. As part of a long-term HR/RM strategy to improve operational efficiencies and take advantage of programmatic cost savings, the internal claims administration staff positions were deleted from the budget in 2010. The City (via RFP) contracted with a third -party claims administrator to process the claims and manage the required ancillary services (bill review, utilization review, and pharmacy). This action resulted in improved program efficiency and moderate cost savings overall. Currently, the City manages its Workers' Compensation third -party claims administration and Managed Care program services (bill review, utilization review, and pharmacy) in a bundled fashion - one provider is responsible for the full complement of services. In an effort to provide a more cost- effective structure for the City, and to improve program efficiency, the City desires to a) select a third - party administrator to handle claims administration and to b) "unbundle" and separate the managed care component services (bill review, utilization review and pharmacy). Following best practices to search the market for cost competitive/superior quality Workers' Compensation third -party claims administration and Managed Care Program services, the City of Huntington Beach issued a Request for Proposal (RFP) regarding the third -party administration of Workers' Compensation claims and the associated managed care programs (bill review, utilization review and pharmacy). The City's intent via the RFP process was to evaluate and select the best qualified respondents for each program service (third -party administration, bill review, utilization review, and pharmacy). The City issued the RFP via Planet BIDS and received four (4) qualified respondents for third -party workers' compensation claims administration services. The four (4) qualified respondents were interviewed and AIMS received the highest evaluation score (85%). The process summary for all respondents included the following phased evaluation steps: Pha.ca. l Evaluation of the proposal materials provided by Bidders/Respondents based upon the RFP criteria. Each respondent was evaluated and scored against the proposal submittal evaluation criteria as listed in the RFP. The proposals were evaluated by Risk Management. Phase 11 Respondents were selected for interviews based on highest evaluation scoring of proposals submitted consistent with the RFP criteria, with a minimum of 60% score or higher. Phase 111 Interviews were held with the four (4) qualifying respondents. The panel evaluators scored each respondent based upon responses to criteria consistent with the RFP. The panel evaluators consisted of internal and external Risk Management professionals, including a Risk Manager, Senior Risk Management Analyst, Risk Management Analyst, and Workers' Compensation Administrator. Of the four (4) qualified respondents that were interviewed, AIMS, received the highest evaluation score (85%). Staff recommends City Council award the contract for TPA services to AIMS and authorize the City City of Huntington Beach Page 2 of 3 Printed on 12/12/2018 145 powered by Legistar,", File #: 18-482 Manager to execute the agreement. Environmental Status: N/A Strategic Plan Goal: Strengthen economic and financial sustainability Attachment(s): 1. Professional Services Contract - AIMS 2. Professional Service Award Analysis - Rank 1 and 2 MEETING DATE: 12/17/2018 City of Huntington Beach Page 3 of 3 146 Printed on 12/12/2018 powered by Legistal-TI PROFESSIONAL SERVICES CONTRACT BETWEEN THE CITY OF HUNTINGTON BEACH AND ACCLAMATION INSURANCE MANAGEMENT SERVICES (AIMS) FOR WORKERS' COMPENSATION THIRD PARTY ADMINSTRATION THIS AGREEMENT ("Agreement") is made and entered into by and between the City of Huntington Beach, a municipal corporation of the State of California, hereinafter referred to as "CITY," and Acclamation Insurance Management Services (AIMS), Inc., a California corporation hereinafter referred to as "CONSULTANT." WHEREAS, CITY desires to engage the services of a consultant to administer certain workers' compensation claims; and Pursuant to documentation on file in the office of the City Clerk, the provisions of the Huntington Beach Municipal Code, Chapter 3.03, relating to procurement of professional service contracts have been complied with; and CONSULTANT has been selected to perform these services, NOW, THEREFORE, it is agreed by CITY and CONSULTANT as follows: 1. SCOPE OF SERVICES CONSULTANT shall provide all services as described in Exhibit "A," which is attached hereto and incorporated into this Agreement by this reference. These services shall sometimes hereinafter be referred to as the "PROJECT." CONSULTANT hereby designates Dominic Russo, President & CEO, who shall represent it and be its sole contact and agent in all consultations with CITY during the performance of this Agreement. 2. CITY STAFF ASSISTANCE CITY shall assign a staff coordinator to work directly with CONSULTANT in the performance of this Agreement. agree/ surfnet/professional sves mayor I of 11 10/12 7. DISPOSITION OF PLANS, ESTIMATES AND OTHER DOCUMENTS CONSULTANT agrees that title to all materials prepared hereunder, including, without limitation, all original drawings, designs, reports, both field and office notices, calculations, computer code, language, data or programs, maps, memoranda, letters and other documents, shall belong to CITY, and CONSULTANT shall turn these materials over to CITY upon expiration or termination of this Agreement or upon PROJECT completion, whichever shall occur first. These materials may be used by CITY as it sees fit. 8. HOLD HARMLESS CONSULTANT hereby agrees to protect, defend, indemnify and hold harmless CITY, its officers, elected or appointed officials, employees, agents and volunteers from and against any and all claims, damages, losses, expenses, judgments, demands and defense costs (including, without limitation, costs and fees of litigation of every nature or liability of any kind or nature) arising out of or in connection with CONSULTANT's (or CONSULTANT's subcontractors, if any) negligent (or alleged negligent) performance of this Agreement or its failure to comply with any of its obligations contained in this Agreement by CONSULTANT, its officers, agents or employees except such loss or damage which was caused by the sole negligence or willful misconduct of CITY. CONSULTANT will conduct all defense at its sole cost and expense and CITY shall approve selection of CONSULTANT's counsel. This indemnity shall apply to all claims and liability regardless of whether any insurance policies are applicable. The policy limits do not act as limitation upon the amount of indemnification to be provided by CONSULTANT. 9. PROFESSIONAL LIABILITY INSURANCE CONSULTANT shall obtain and furnish to CITY a professional liability insurance policy covering the work performed by it hereunder. This policy shall provide coverage for CONSULTANT's professional liability in an amount not less than One Million Dollars agree/ surfna/professional Svcs mayor 3 of 11 10/12 ($1,000,000.00) per occurrence and in the aggregate. The above -mentioned insurance shall not contain a self -insured retention without the express written consent of CITY; however an insurance policy "deductible" of Ten Thousand Dollars ($10,000.00) or less is permitted. A claims -made policy shall be acceptable if the policy further provides that: A. The policy retroactive date coincides with or precedes the initiation of the scope of work (including subsequent policies purchased as renewals or replacements). B. CONSULTANT shall notify CITY of circumstances or incidents that might give rise to future claims. CONSULTANT will make every effort to maintain similar insurance during the required extended period of coverage following PROJECT completion. If insurance is terminated for any reason, CONSULTANT agrees to purchase an extended reporting provision of at least two (2) years to report claims arising from work performed in connection with this Agreement. If CONSULTANT fails or refuses to produce or maintain the insurance required by this section or fails or refuses to furnish the CITY with required proof that insurance has been procured and is in force and paid for, the CITY shall have the right, at the CITY's election, to forthwith terminate this Agreement. Such termination shall not effect Consultant's right to be paid for its time and materials expended prior to notification of termination. CONSULTANT waives the right to receive compensation and agrees to indemnify the CITY for any work performed prior to approval of insurance by the CITY. 10. CERTIFICATE OF INSURANCE Prior to commencing performance of the work hereunder, CONSULTANT shall furnish to CITY a certificate of insurance subject to approval of the City Attorney evidencing the foregoing insurance coverage as required by this Agreement; the certificate shall: agree/ surfnet/professional sves mayor 4 of 11 10/12 A. provide the name and policy number of each carrier and policy; B. state that the policy is currently in force; and C. shall promise that such policy shall not be suspended, voided or canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice; however, ten (10) days' prior written notice in the event of cancellation for nonpayment of premium. CONSULTANT shall maintain the foregoing insurance coverage in force until the work under this Agreement is fully completed and accepted by CITY. The requirement for carrying the foregoing insurance coverage shall not derogate from CONSULTANT's defense, hold harmless and indemnification obligations as set forth in this Agreement. CITY or its representative shall at all times have the right to demand the original or a copy of the policy of insurance. CONSULTANT shall pay, in a prompt and timely manner, the premiums on the insurance hereinabove required. 11. INDEPENDENT CONTRACTOR CONSULTANT is, and shall be, acting at all times in the performance of this Agreement as an independent contractor herein and not as an employee of CITY. CONSULTANT shall secure at its own cost and expense, and be responsible for any and all payment of all taxes, social security, state disability insurance compensation, unemployment compensation and other payroll deductions for CONSULTANT and its officers, agents and employees and all business licenses, if any, in connection with the PROJECT and/or the services to be performed hereunder. 12. TERMINATION OF AGREEMENT All work required hereunder shall be performed in a good and workmanlike manner. CITY may terminate CONSULTANT's services hereunder at any time with or without cause, and whether or not the PROJECT is fully complete. Any termination of this Agreement by CITY shall agree/ surfnet/professional Svcs mayor 5 of 11 10/12 be made in writing, notice of which shall be delivered to CONSULTANT as provided herein. In the event of termination, all finished and unfinished documents, exhibits, report, and evidence shall, at the option of CITY, become its property and shall be promptly delivered to it by CONSULTANT. 13. ASSIGNMENT AND DELEGATION This Agreement is a personal service contract and the work hereunder shall not be assigned, delegated or subcontracted by CONSULTANT to any other person or entity without the prior express written consent of CITY. If an assignment, delegation or subcontract is approved, all approved assignees, delegates and subconsultants must satisfy the insurance requirements as set forth in Sections 9 and 10 hereinabove. 14. COPYRIGHTS/PATENTS CITY shall own all rights to any patent or copyright on any work, item or material produced as a result of this Agreement. 15. CITY EMPLOYEES AND OFFICIALS CONSULTANT shall employ no CITY official nor any regular CITY employee in the work performed pursuant to this Agreement. No officer or employee of CITY shall have any financial interest in this Agreement in violation of the applicable provisions of the California Government Code. 16. NOTICES Any notices, certificates, or other communications hereunder shall be given either by personal delivery to CONSULTANT's agent (as designated in Section 1 hereinabove) or to CITY as the situation shall warrant, or by enclosing the same in a sealed envelope, postage prepaid, and depositing the same in the United States Postal Service, to the addresses specified below. CITY and CONSULTANT may designate different addresses to which subsequent notices, certificates or a,-ree/ surfneUprofessional Svcs mayor 6 of 11 10/12 other communications will be sent by notifying the other party via personal delivery, a reputable overnight carrier or U. S. certified mail -return receipt requested: TO CITY: City of Huntington Beach ATTN: Human Resources Director 2000 Main Street Huntington Beach, CA 92648 17. CONSENT TO CONSULTANT: Acclamation Insurance Management Services ATTN: Dominic Russo, President & CEO 10445 Old Placerville Road Sacramento, CA 95827 When CITY's consent/approval is required under this Agreement, its consent/approval for one transaction or event shall not be deemed to be a consent/approval to any subsequent occurrence of the same or any other transaction or event. 18. MODIFICATION No waiver or modification of any language in this Agreement shall be valid unless in writing and duly executed by both parties. 19. SECTION HEADINGS The titles, captions, section, paragraph and subject headings, and descriptive phrases at the beginning of the various sections in this Agreement are merely descriptive and are included solely for convenience of reference only and are not representative of matters included or excluded from such provisions, and do not interpret, define, limit or describe, or construe the intent of the parties or affect the construction or interpretation of any provision of this Agreement. 20. INTERPRETATION OF THIS AGREEMENT The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. If any provision of this Agreement is held by an arbitrator or court of competent jurisdiction to be a,-ree/ surfnef/professional svcs mayor 7 of 11 10/12 unenforceable, void, illegal or invalid, such holding shall not invalidate or affect the remaining covenants and provisions of this Agreement. No covenant or provision shall be deemed dependent upon any other unless so expressly provided here. As used in this Agreement, the masculine or neuter gender and singular or plural number shall be deemed to include the other whenever the context so indicates or requires. Nothing contained herein shall be construed so as to require the commission of any act contrary to law, and wherever there is any conflict between any provision contained herein and any present or future statute, law, ordinance or regulation contrary to which the parties have no right to contract, then the latter shall prevail, and the provision of this Agreement which is hereby affected shall be curtailed and limited only to the extent necessary to bring it within the requirements of the law. 21. DUPLICATE ORIGINAL The original of this Agreement and one or more copies hereto have been prepared and signed in counterparts as duplicate originals, each of which so executed shall, irrespective of the date of its execution and delivery, be deemed an original. Each duplicate original shall be deemed an original instrument as against any party who has signed it. 22. IMMIGRATION CONSULTANT shall be responsible for full compliance with the immigration and naturalization laws of the United States and shall, in particular, comply with the provisions of the United States Code regarding employment verification. 23. LEGAL SERVICES SUBCONTRACTING PROHIBITED CONSULTANT and CITY agree that CITY is not liable for payment of any subcontractor work involving legal services, and that such legal services are expressly outside the scope of services contemplated hereunder. CONSULTANT understands that pursuant to Huntington Beach City Charter Section 309, the City Attorney is the exclusive legal counsel for agree/ surfnet/professional sves mayor 8 Of 11 l0/12 CITY; and CITY shall not be liable for payment of any legal services expenses incurred by CONSULTANT. 24. ATTORNEY'S FEES In the event suit is brought by either party to construe, interpret and/or enforce the terms and/or provisions of this Agreement or to secure the performance hereof, each party shall bear its own attorney's fees, such that the prevailing party shall not be entitled to recover its attorney's fees from the nonprevailing party. 25. SURVIVAL Terms and conditions of this Agreement, which by their sense and context survive the expiration or termination of this Agreement, shall so survive. 26. GOVERNING LAW This Agreement shall be governed and construed in accordance with the laws of the State of California. 27. SIGNATORIES Each undersigned represents and warrants that its signature hereinbelow has the power, authority and right to bind their respective parties to each of the terms of this Agreement, and shall indemnify CITY fully for any injuries or damages to CITY in the event that such authority or power is not, in fact, held by the signatory or is withdrawn. 28. ENTIRETY The parties acknowledge and agree that they are entering into this Agreement freely and voluntarily following extensive arm's length negotiation, and that each has had the opportunity to consult with legal counsel prior to executing this Agreement. The parties also acknowledge and agree that no representations, inducements, promises, agreements or warranties, oral or otherwise, have been made by that party or anyone acting on that party's behalf, which are not embodied in this agree/ surfnet/professional sves mayor 9 of 11 10/12 Agreement, and that that party has not executed this Agreement in reliance on any representation, inducement, promise, agreement, warranty, fact or circumstance not expressly set forth in this Agreement. This Agreement, and the attached exhibits, contain the entire agreement between the parties respecting the subject matter of this Agreement, and supersede all prior understandings and agreements whether oral or in writing between the parties respecting the subject matter hereof. 29. EFFECTIVE DATE This Agreement shall be effective on November 1, 2018 with approval by the City Council. This Agreement shall expire when terminated as provided herein. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers. agree/ surfnet/professional sves mayor 10 of 11 10/12 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers. CONSULTANT, Acclamation Insurance Management Services, a California corporation By. Dominic Russo nn n ITS: resident & CE circle one) Chairman/President/Vice President FRO l� print name ITS: (circle one) Secretary/Chief Financial Officer/ Secretary - Treasurer COUNTERPART CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California ST ^ '^` ti hW4Ad City CleX 1 LNW, 1. 'rl I rector REVIE D APPROVED: City Panager 11 of 11 agree/ surfnet/professional svcs mayor - 10/12 18-6763/185952 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through their authorized officers. CONSULTANT, Acclamation Insurance Management Services, a California corporation By. Dominic Russo print name 1«'S:resident & CEO circte one) Chairman/President/Vice President `JEF 9 rint name ITS: (circle one Secretary hief Financial Secretary - Treasurer co u-N-'rFRFART agree/ surfnet/professional svcs mayor - 10/12 18-6763/185952 CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California Mayor City Cl REVIEWED AND APPROVED: 11 of 11 City Manager EXHIBIT "A" A. STATEMENT OF WORK: (Narrative of work to be performed) Administer the City's claims for Workers' Compensation benefits in accordance with the requirements of the Workers' Compensation laws of the State of California; provide the City with cost effective claims adminstration while delivering value added services with measurable results and better outcomes. B. CONSULTANT'S DUTIES AND RESPONSIBILITIES: CONSULTANT's duties and responsibilities shall follow provisions specified in the City of Huntington Beach Scope of Work shown in Exhibit A.1. Detailed services shall include but is not limited to the Scope of Work in Exhibit A.1. C. CITY'S DUTIES AND RESPONSIBILITIES: City shall collaborate with CONSULTANT to promote compliance with Scope of Work requirements; foster a high level of communication, trust, transparency, and commitment which is imperative to the success of the program. D. WORK PROGRAM/PROJECT SCHEDULE: Work program is required per the Scope of Services as requested by the CITY. EXHIBIT A EXHIBIT A.1 ACCLAMATION INSURANCE MANAGEMENT SERVICES SCOPE OF SERVICES Program Administration • The selected Consultant (TPA) firm will interface directly with the City's injured employees in close coordination with Risk Management. • Inform the City of proposed changes in statues, rules and regulations, and case law affecting the workers' compensation program. Dedicated/Designated Assigned Personnel • The Consultant/TPA shall provide a dedicated claims examiner to the City's account. • The Consultant/TPA shall provide a designated claims unit supervisor that will regularly review the work product of the claims examiner(s). • Claims examiner(s) must be certified with the State of California and be experienced dealing with public safety officers. • Consultant/TPA shall provide sufficient team of claims examiner(s) that are dedicated to the City's account and maintain a caseload of approximately 150 claims. • Consultant/TPA will continue to staff the City's account with a blend of current experienced personnel and new hires if needed. Claims Management Services • Administer Workers' Compensation benefits in accordance with the Labor Code. • Make initial contact with the employee and establish a claims file within 24 hours of receipt of the Employer's First Report of Injury for the City. Claim files will be available for review by the City at any time during the TPA's regular business hours. • The Consultant/TPA must resolve City issues immediately to the City's satisfaction. This may include reassignment of claims examiner(s) staff. • The compensability determination (accept claim, deny claim, or delay acceptance pending the results of additional investigation) and the reasons for such determination • Provide guidance and information regarding Workers' Compensation benefits to City employees. • Respond to City staff inquiries within twenty four (24) hours and critical issues on the same day. • Monitor treatment programs for injured employees to ensure that they receive proper care and to avoid over treatment situations. • Establish claim reserves and provide a continual review and update of reserves to reflect changes during the life of the claim. • All reserves initial or changes are to be documented by the completion of a Reserve Worksheet contained within the Claims Information Management System. The reserve rationale must be completed for each entry into the Claims Information Management System. The basis for establishing reserves shall be clearly documented in every reserve worksheet and case notes as applicable. • Reserve worksheets are prepared to support any changes made in reserving amounts and can be provided to the City in support of a reserve increase or other change. This information is made available to the City through online viewing of the Claims Examiner's electronic file notepad. If the City desires, prior to any reserve change of a pre -agreed amount or level, the Claims Examiner will confer with appropriate City personnel to discuss the merits of the proposed change. • Claims Examiner will review and evaluate the reserve adequacy and possible closure at 30 to 90 day intervals or as designated by the City. • The Consultant/TPA should pursue actions of abuse of the Workers' Compensation system or suspected fraud. • Investigate and recommend special, outside independent investigations for questionable claims with the consent, coordination and assistance of the City of Huntington Beach. • City authorization shall first be obtained before initiating any field investigation. The authorization will be documented in the notepad section of the claims file. • The claims examiner shall obtain the City's authorization on all claim settlements. • All penalties incurred because of failure of the Consultant to comply with statutory laws and/or reimbursement should be brought to the City's attention, and shall be the sole responsibility of the third party administrator and reimbursement shall be made on a quarterly basis. • The Consultant/TPA will be responsible to identify subrogation opportunities and in consultation with Risk Management, will be called upon to pursue subrogation. • The Consultant/TPA will be required to conduct file/claims reviews at the discretion of the City of Huntington Beach. • Assist with the ongoing development and maintenance of the Alternative Dispute Resolution (ADR) carve -out program. • Consultant/claims examiner will seek approval from the City/Risk Management when assigning a specific nurse case manager to individual claim files. • Claims examiner will seek approval from the City's Risk Management Department when assigning specific vendors to provide durable medical equipment for specific claim files. • Claims examiner shall obtain the City/Risk Management authorization to assign legal counsel to specific claim files. • Claims examiner will seek approval from the City/Risk Management when assigning sub rosa/surveillance and/or social media for specific claim files. Claims Management Software • The claim's management software should provide a claim description, financial data, and ad hoc reports on claims using criteria such as reserves, paid, indemnity, etc. • The claims management system must be read-only accessible to City of Huntington Beach Risk Management with licensing allowing a minimum of three (3) individual computers to access claim information simultaneously. • The selected firm will be required to provide training to Risk Management staff on report generation and the use of software. Reporting • Reports generated by the TPA should be furnished to the City in paper or electronic form as requested. • Provide customized reports as needed upon reasonable request. • Provide a monthly administrative report in Excel format, including information such as: o Number of claims, medical only, indemnity and reporting only o Number of closed claims o Number of active files assigned to each claims adjuster o Indemnity paid in 4850 benefits, TD, PD, Death and Rehabilitation Benefits o Expenses paid o Cases assigned to counsel, investigators and nurse advocate o Amounts recovered in apportionment or subrogation o Number of litigated cases o List of cases settled during the'month, indicating the amount of the settlement and method/type of settlement o Legal report reflecting defense attorneys with monthly billing/expense and year- to-date current total spend. o Report reflecting detailed durable medical equipment spend. Provide the following annual report to Risk Management: o Assemble and submit workers' compensation claims data as required for State reports, including the self-insurance report to Industrial Relations. State reporting shall be only for the Claims Management Services and shall not include reporting for the Managed Care Program Consultants. Assemble and submit data needed for actuarial studies performed on the City's Workers' Compensation Program o OSHA 300 log of Work -Related Injuries and Illnesses; and OSHA 300A Summary of Work -Related Injuries and Illnesses o The annual carve out report for the ADR program as required by the State of California o Annual Stewardship Report with pertinent statistics for benchmarking and ADR program, measuring the City of Huntington Beach's workers' compensation program Banking, Tax Reporting & Financial Needs • City of Huntington Beach will establish and maintain a bank account from which TPA will issue checks for payment of services and benefits. • The TPA will provide weekly to City of Huntington Beach's Risk Management and Finance Department a check register, indicating date, check number, payee, reason for payment and amount paid, in Excel/spreadsheet format. • The City of Huntington Beach Finance Department will reconcile bank account statements against check registers provided by the TPA. • Invoices for replenishment of the City's Trust Account shall be submitted to City weekly on Thursday. The invoices submitted will replenish the fund expenditures from the previous week. • Monthly reconciliation invoices will be submitted at the end of any given month. These invoices will replenish any other funds in the account not covered under the weekly invoices. • Provide any other written documentation to support any changes to the trust account balance. Future Medical Claims • Reviews shall be documented in the claims notes to include settlement information, outline future medical care, last date and type of treatment, name of excess carrier, excess carrier reporting history. • The claim examiner shall regularly evaluate the claim to determine a reasonable amount for settlement of future medical payments and any remaining benefits due. The reason(s) and calculation(s) for the recommended settlement amount shall be clearly documented. Coordination with Managed Care Program (MCP) Consultants • Consultant/TPA shall be prepared to interface with all MCP/Ancillary service providers in a professional and efficient manner. EXHIBIT "B" Payment Schedule (Fixed Fee Payment) (**SEE EXHIBIT B.1— FIXED FEE PAYMENT SCHEDULE) 1. CONSULTANT shall be entitled to monthly progress payments toward the fixed fee set forth herein in accordance with the following progress and payment schedules. 2. Delivery of work product: A copy of every memorandum, letter, report, calculation and other documentation prepared by CONSULTANT shall be submitted to CITY to demonstrate progress toward completion of tasks. In the event CITY rejects or has comments on any such product, CITY shall identify specific requirements for satisfactory completion. 3. CONSULTANT shall submit to CITY an invoice for each monthly progress payment due. Such invoice shall: A) Reference this Agreement; B) Describe the services performed; C) Show the total amount of the payment due; D) Include a certification by a principal member of CONSULTANT's firm that the work has been performed in accordance with the provisions of this Agreement; and E) For all payments include an estimate of the percentage of work completed. Upon submission of any such invoice, if CITY is satisfied that CONSULTANT is making satisfactory progress toward completion of tasks in accordance with this Agreement, CITY shall approve the invoice, in which event payment shall be made within thirty (30) days of receipt of the invoice by CITY. Such approval shall not be unreasonably withheld. If CITY does not approve an invoice, CITY shall notify CONSULTANT in writing of the reasons for non -approval and the schedule of performance set forth in Exhibit "A" may at the option of CITY be suspended until the parties agree that past performance by CONSULTANT is in, or has been brought into compliance, or until this Agreement has expired or is terminated as provided herein. 4. Any billings for extra work or additional services authorized in advance and in writing by CITY shall be invoiced separately to CITY. Such invoice shall contain all of the information required above, and in addition shall list the hours expended and hourly rate charged for such time. Such invoices shall be approved by CITY if the work performed is in accordance with the extra work or additional services requested, and if CITY is satisfied that the statement of hours worked and costs incurred is accurate. Such approval shall not be unreasonably withheld. Any dispute between the parties concerning payment of such an invoice shall be treated as separate and apart from the ongoing performance of the remainder of this Agreement. Exhibit B EXHIBIT B.1 ACCLAMATION INSURANCE MANAGEMENT SERVICES (AIMS) FIXED FEE PAYMENT SCHEDULE CONTRACT Y YEARS I FY 18-19 FY 19-20 FY 20-21 THIRD PARTY ADMINISTRATION The pricing set -forth below are based on AIMS recommended staffing for the City's program to handling all the claims identified in the subject RFP and as noted above. The anticipated staffing will adhere to the requirements of this RFP and include experienced Claims Examiners that will manage an average of 150 or less open indemnity claims each. As appropriate, Future Medical files are counted on a 2:1 basis, per California State Association of Counties - Excess Insurance Authority (CSAC-EIA) guidelines, or two future medical files are considered to beequal to one lost time indem ity file. Unbundled $ 446,691.00 $ 446,691.00 S 446,691.00 Please circle services included in bundled cost: UR, BR, PBM, NCM — None included AIMS proposes the use of Allied Managed Care, Inc. (AMC) to provide any necessary medical cost containment services. As distinguished from other service providers, AIMS and AMC price their services on a stand-alone basis. In other words, AIMS prices the claims administration services without regard to whether AMC's services as a managed care provider are being used and vice -versa. The fees are the same whether the services are bundled together or unbundled. This provides for a transparency for our Clients to clearly understand what they are pavina for. Rate per claim in excess of % The fees proposed cover claims administration for all new and existing claims set forth in this RFP and any Addendum thereto. This fee is premised on, and in reliance on, the claim volumes as set forth in the RFP or related information provided. Should AIMS be selected to continue the Claims Administration for the City and receive more claims than anticipated from the City at the start of the new contract or if there is a 5% increase/decrease during the initial transfer or during any period of the contract due to significant change in the number of employees, and/or as a result of a catastrophic event, then both AIMS and the City will negotiate, in good faith, a reasonable fee increase/decrease fee adjustment based on any revised required staffing. Indemnity Claim See above See above See above Medical Only Claim See above See above See above List any Administrative fees, professional fees, etc.: No No No Additional Additional Additional Fees Fees Fees 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 PROFESSIONAL SERVICES CONTRACT BETWEEN THE CITY OF HUNTINGTON BEACH AND ACCLAMATION INSURANCE MANAGEMENT SERVICES (AIMS) FOR WORKERS' COMPENSATION THIRD PARTY ADMINISTRATION Table of Contents Scopeof Services.....................................................................................................I CityStaff Assistance................................................................................................2 Term; Time of Performance.....................................................................................2 Compensation..........................................................................................................2 ExtraWork...............................................................................................................2 Methodof Payment..................................................................................................3 Disposition of Plans, Estimates and Other Documents...........................................3 HoldHarmless.........................................................................................................3 Professional Liability Insurance.............................................................................4 Certificate of Insurance............................................................................................5 Independent Contractor............................................................................................6 Termination of Agreement.......................................................................................6 Assignment and Delegation......................................................................................6 Copyrights/Patents...................................................................................................7 City Employees and Officials..................................................................................7 Notices.........................................................................................7 Consent....................................................................................................................8 Modification.............................................................................................................8 SectionHeadings.....................................................................................................8 Interpretation of this Agreement..............................................................................8 DuplicateOriginal....................................................................................................9 Immigration...............................................................................................................9 Legal Services Subcontracting Prohibited................................................................9 Attorney's Fees..........................................................................................................10 Survival.....................................................................................................................10 GoverningLaw.........................................................................................................10 Signatories.................................................................................................................10 Entirety......................................................................................................................10 EffectiveDate................................................................................. I I Client#: 6105 ACCLINSU ACORD.,, CERTIFICATE OF LIABILITY INSURANCE DATD/YWY) 71101200/2018 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer any rights to the certificate holder in lieu of such endorsement(s). PRODUCER CONTACT NAME: Laurie Martin Edgewood Partners Ins. Center a/co No Eat : 415 356-3934 FAX No 425 California Street, 24th Floor E-MAIL certS a Icbrokers.com ADDRESS: p Lic#0629730 (415) 356-3900 INSURER(S) AFFORDING COVERAGE NAIC # San Francisco, CA 94104 INSURER A :National Fira Ina of Hartford 20478 INSURED Acclamation Insurance Management 10445 Old Placerville Road Sacramento, CA 95827 COVFRGGFS CFRTIFICGTF NIIMRFR- INSURER B : The Continental Insurance Company 35289 INSURER C : State Comp—tion Ins Fund 35076 INSURER D : Navlgatom Spaclalty Inaurance Company 42307 INSURER E : Vall y Forge Insurance Co 20508 INSURER F : Uoyds of London REVISION NHMRFR- THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACTOR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR LTR TYPE OF INSURANCE ADDL SUBR INSR WVD POLICY NUMBER POLICY EFF MM/DDIYYYY POLICY EXP MM/DD/YYYY LIMITS A X COMMERCIAL GENERAL LIABILITY 6056760864 1/01/2018 01/0112019 EACH OCCURRENCE $1,000,000 CLAIMS -MADE � OCCUR PREMISESa occurrence $1,000,000 MED EXP (Any one person) $15 000 PERSONAL &ACV INJURY $1,000,000 GEN'L AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $2,000,000 PRO - POLICY ❑ JECT FX LOC PRODUCTS - COMP/OP AGG $2,000,000 $ OTHER: E AUTOMOBILE LIABILITY 6056760850 1/01/2018 01/01/201 EaaBcideDtSINGLELIMIT 1,000,000 BODILY INJURY (Per person) $ X ANY AUTO OWNED SCHEDULED AUTOS ONLY AUTOS X HIRED ONLY X NON -OWNED AUTOS ONLY APPROVED TO FORM BODILY INJURY (Per accident) $ PROPERTY DAMAGE Per accident $ B X UMBRELLA LIAB EXCESS LIAB X OCCUR CLAIMS -MADE 6056760878 1> By. MICHAEL 18 01/01/201 EACH OCCURRENCE $10000 000 AGGREGATE $1 O 000 000 GA $ DED RETENTION $ $ C WORKERS COMPENSATION AND EMPLOYERS' LIABILITY ANY PROPRIETOR/PARTNER/EXECUTIVE Y / N OFFICER/MEMBER EXCLUDED? � (Mandatory in NH) NIA 908337918 CITY OF HUNTI AN /01/201 X PER OTH- E.L. EACH ACCIDENT $1,000,000 E.L. DISEASE - EA EMPLOYEE $1,000,000 E.L. DISEASE - POLICY LIMIT $1,000,000 If yes, describe under DESCRIPTION OF OPERATIONS below 07/11/201 D Professional Liab CE18MPL09067IC 7/11/2018 $5,000,000 Ann Agg-E&O F Privacy Liability 507097 7/11/2018 07/11/201 $3,000,000 ea claim/agg $25,000 SIR E&O & C ber DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) Claims administration services including Nurse Case Management and Bill Review. Named insured includes: Acclamation Insurance Management Services, Inc.; Allied Managed Care, Inc.; LJR Holdings, Inc.; LJR Properties, LLC (See Attached Descriptions) GtK I It -ILA It FIULUtK LANL.tLLAI IUN City f Huntington Beach SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE y og THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN 2000 Main Street ACCORDANCE WITH THE POLICY PROVISIONS. Huntington Beach, CA 92648-0000 AUTHORIZED REPRESENTATIVE ©1988-2015 ACORD CORPORATION. All rights reserved. ACORD 25 (2016/03) 1 of 2 The ACORD name and logo are registered marks of ACORD #S1121677/M1121608 LLIA1 DESCRIPTIONS '(C'ohtihued from Page 1) Thirty day notice of cancellation will be provided to the certificate holder but 10 days for non-payment of premium. EMPLOYEE DISHONESTY / CRIME COVERAGE: Federal Insurance Company. #82344565 EFF: 1/1/18 EXP: 1/1/19 DISHONESTY LIMIT: $2,000,000 $35,000 DEDUCTIBLE Third party claims administration services. SAGITTA 25.3 (2016/03) 2 of 2 #S927403/M926813 Bidder's List for Workers' Compensation Third Party Administrator Company Name Phone AIMS 916-563-1900 Athens 949-296-3951 Adminsure 909-396-5813 Hazelrigg 909-606-6373 PROFESSIONAL SERVICE AWARD ANALYSIS SERVICE: Workers' Compensation Third Party Administrator SERVICE DESCRIPTION: Provide Workers' Compensation claims administration. VENDOR: AIMS (Acclamation Insurance Management Services) OVERALL RANKING: -1 SUBJECT MATTER EXPERTS/RATERS: 1. City of H.B. Risk Manager2, City ofH.B, 5eniorRisk Management Analyst 3. City of Fullerton Risk Management Analyst 4, City of Los Angeles Workers' Compensation Administrator I. MINIMUM QUALIFICATIONS REVIEW • Written Proposal Score: 85% ;AIMS Miniixiurri.4lif[cafions RelrieW - Total Weighted Maximum Criteria Score Score Compliance with RFP 8% 10% Approach & Methodology 20% 25% Qualifications & Experience 25% 25% Partnership & Value Added Features 16% 20% Proposed Cost 16% 20% Total II. DUE DILIGENCE REVIEW • Interview Ranking: 1 • Compliance with RFP, inclusion of required certifications. • Methodology and approach is good and in line with Risk Management's preferred style, • Very qualified: Dedicated staff already on site. • Value added feature includes excellent past/previous experience with the City's ADR program, • Claims handling customer service levels are above average and consistent - I► - - - M. r �" _ Competitive pricing -y r flat=fefor p titive P g y the unbundled program (best pricing out of 4 proposals submitted). PROFESSIONAL SERVICE AWARD ANALYSIS SERVICE: Workers' Compensation Third Party Administrator SERVICE DESCRIPTION: Provide Workers' Compensation claims administration. VENDOR: Vendor #2 OVERALL RANKING: 2 SUBJECT MATTER EXPERTS/RATERS: 1. C1(yof H,B, Risk Manager2, City of H,B, Senior Risk Management Analyst 3, City of Fullerton Risk Management Analyst 4. City of Los Angeles Workers' Compensation Administrator I. MINIMUM QUALIFICATIONS REVIEW • Written Proposal Score: 77% 3-1-1---, L Criteria Compliance with RFP Approach & Methodology Qualifications & Experience Partnership & Value Added Features Proposed Cost Total 7-1v Total Weighted Maximum Score Score 8% 10% 25% 25% 20% 25% 12% 20% 12% 20% 11. DUE DILIGENCE REVIEW • Interview Ranking: 2 Vendor Summary ------------ • Compliance with RFP, inclusion of required certifications. • Methodology and approach is good. • Need to hire staff to handle City's claims. • Value added feature includes a "closing claims" incentive at their firm. V "6`-,-N P"i rtg • Pricing is above industry average (31d place out of 4 proposals submitted). City of Huntington Beach 2000 Main Street ♦ Huntington Beach, CA 92648 (714) 536-5227 ♦ www.huntingtonbeachca.gov Office of the City Clerk Robin Estanislau, City Clerk January 10, 2019 Acclamation Insurance Management Services Attn: Dominic Russo, President & CEO 10445 Old Placerville Road Sacramento, CA 95827 Dear Mr. Russo: Enclosed is a copy of the fully executed "Professional Services Contract between the City of Huntington Beach and Acclamation Insurance Management Services (AIMS) for Workers' Compensation Third Party Administration" approved by the Huntington Beach City Council on December 17, 2018. Sincerely, Robin Estanislau, CIVIC City Clerk RE:ds Enclosure Sister Cities: Anjo, Japan ♦ Waitakere, New Zealand From: pacj <pacj_03@yahoo.com> Sent: Thursday, December 13, 2018 11:41 PM To: Estanislau, Robin <Robin.Estanislau@surfcity-hb.org> Subject: City Council agenda 12-17-18 Please share my note with city council and appropriate city staff. With respect to agenda items related to workers compensation/utilization review/medical bill review, please provide link to rfp(s) and list of those firms who responded to the rfp(s), those firms which were interviewed and their respective scores. How does the city monitor the tpa to ensure timely claims processing and benefit provision? Does the city hire an outside firm to audit the tpa? If so how is that firm selected? Thank you. Pat Quintana 915 California St HB 92648 McWg Date: a -� 3 Agenda item No • rN'! {= �f M M Estanislau, Robin From: Warren, Michele Sent: Friday, December 14, 2018 2:01 PM To: pacj_03@yahoo.com Cc: Estanislau, Robin Subject: City Council Agenda 12-17-18 Pat Quintana, This communication is in response to your e-mail related to the workers' compensation/utilization review/medical bill review item. All RFP information for the services referenced in the agenda item was obtained via Planet Bids (link here): https://www.planetbids.com/portal/portal.cfm?CompanVID=15340 There are multiple tabs related to the specific RFP results which provide information on various bidders. The staff report provides summary information on the review process and results (link here): file://cohb.net/files/UserDirs/warrenm/Downloads/Staff%20Report%20(3).pdf As well, each item has the review results as an attachment to the staff report (link here): file://cohb.net/files/UserDirs/warrenm/Downloads/Att2%2OProfessional%2OService%2OAward%2OAnalysis%20- %20Ra nk%201%20a nd%202. pdf The TPA is audited by Bickmore Risk Services to review compliance in 16 areas: • Caseload • Case Review and Documentation • Communication • Fiscal Handling • Medicare Reporting • Claim Creation • Payments & Benefit • Notices • Medical Treatment • Apportionment • Disability Management • Supplemental Job Displacement Benefits • Claims Reserving • Resolution of Claim • Settlement Authority • Litigated/Subrogation Cases • Excess Insurance Bickmore Risk Services is an independent consulting firm providing Risk Management consultation to public sector agencies (website link here): https://www.bickmore.net/ Hopefully this information effectively responds to your inquiry. Thank you. 1 Michele Warren Director of Human Resources City of Huntington Beach Estanislau, Robin From: Estanislau, Robin Sent: Monday, December 17, 2018 10:41 AM To: ,pacj, Subject: RE: For Mayor Peterson Received. Robin Estanislau, CMC, City Clerk City of Huntington Beach 714-536-5405 Please consider the HB City Clerk's office for your passport needs! From: pacj <pacj_03@yahoo.com> Sent: Friday, December 14, 2018 4:53 PM To: Estanislau, Robin <Robin.Estanislau@surfcity-hb.org> Subject: For Mayor Peterson Robin, Can you please forward Ms Warren's response to Mayor Peterson as well as my note which follows: Dear Mayor Peterson I have been asking questions about the city's workers comp program since 2015. My questions are responded to but only partially answered. The subject of workers comp arises again on 12-17-18. When I read the council meeting agenda I asked about the workers comp rfp, about who responded, about who was interviewed and about the scoring of each vendor who was interviewed. I also asked who monitors the tpa chosen and if an outside firm how that vendor is selected. Robin has forwarded Ms Warren's response which includes a series of links which I cannot open and does not answer my questions. That is not government transparency. I would appreciate my questions being answered and it appears I need your intervention to have them answered. I have one additional concern. The council delves into a number of subjects. Considerable attention is given by the council on public pensions and unfunded liability. Attention should also be given to the city's workers comp program and its unfunded liability. My concern is that this important program which impacts the total unfunded liability for the city is not on the council's radar. Mayor Peterson, thank you for looking into this matter. Sincerely, Pat Quintana