CONTRACT 3882 CLOSED 3882 . ,
PROFESSIONAL SERVICES AGREEMENT
BETWEEN
THE CITY OF EL SEGUNDO AND
SOUTHERN CALIFORNIA RISK MANAGEMENT ASSOCIATES,INC.
This AGREEMENT is entered into this lst day of January, 2009, by and between the
CITY OF EL SEGUNDO, a municipal corporation and general law city ("CITY") and
SOUTHERN CALIFORNIA RISK MANAGEMENT ASSOCIATES ("SCRMA"), a municipal
corporation("CONSULTANT").
1. CONSIDERATION.
A. As partial consideration, CONSULTANT agrees to perform the work listed in the
SCOPE OF SERVICES,below;
B. As additional consideration, CONSULTANT and CITY agree to abide by the
terms and conditions contained in this Agreement;
C. As additional consideration, CITY agrees to pay CONSULTANT a sum not to
exceed Seventy-Six Thousand Seven Hundred Fifty Dollars ($76,750) for
CONSULTANT's services. CITY may modify this amount as set forth below.
Unless otherwise specified by written amendment to this Agreement, CITY will
pay this sum as specified in the attached Exhibit "B," which is incorporated by
reference.
2. SCOPE OF SERVICES.
A. CONSULTANT will perform services listed in the attached Exhibit"A," which is
incorporated by reference.
B. CONSULTANT will, in a professional manner, furnish all of the labor, technical,
administrative, professional and other personnel, all supplies and materials,
equipment, printing, vehicles, transportation, office space and facilities, and all
tests, testing and analyses, calculation, and all other means whatsoever, except as
herein otherwise expressly specified to be furnished by CITY, necessary or proper
to perform and complete the work and provide the professional services required.
of CONSULTANT by this Agreement.
3. PERFORMANCE STANDARDS. While performing this Agreement, CONSULTANT
will use the appropriate generally accepted professional standards of practice existing at the time
of performance utilized by persons engaged in providing similar services. CITY will
continuously monitor CONSULTANT's services. CITY will notify CONSUL"I"Ai T of any
deficiencies and CONSULTANT will have fifteen (15) days after such notification to cure any
shortcomings to CITY's satisfaction. Costs associated with curing the deficiencies will be borne
by CONSULTANT.
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4. PAYMENTS. For CITY to pay CONSULTANT as specified by this Agreement,
CONSULTANT must submit a detailed invoice to CITY which lists the hours worked and
hourly rates for each personnel category and reimbursable costs (all as set forth in Exhibit`B")
the tasks performed, the percentage of the task completed during the billing period, the
cumulative percentage completed for each task, the total cost of that work during the preceding
billing month and a cumulative cash flow curve showing projected and actual expenditures
versus time to date.
5. NON-APPROPRIATION OF FUNDS. Payments due and payable to CONSULTANT for
current services are within the current budget and within an available,unexhausted and
unencumbered appropriation of the CITY. In the event the CITY has not appropriated sufficient
funds for payment of CONSULTANT services beyond the current fiscal year,this Agreement
will cover only those costs incurred up to the conclusion of the current fiscal year.
6. ADDITIONAL WORK.
A. CITY's city manager("Managers") may determine, at the Manager's sole
discretion, that CONSULTANT must perfonn additional work("Additional
Work")to complete the Scope of Work. If Additional Work is needed, the
Manager will give written authorization to CONSULTANT to perform such
Additional Work.
B. If CONSULTANT believes Additional Work is needed to complete the Scope of
Work, CONSULTANT will provide the Manager with written notification that
contains a specific description of the proposed Additional Work,reasons for such
Additional Work, and a detailed proposal regarding cost.
C. Payments over$25,000 for Additional Work must be approved by CITY's city
council. All Additional Work will be subject to all other terms and provisions of
this Agreement.
7. FAMILIARITY WITH WORK.
A. By executing this Agreement, CONSULTANT agrees that it has:
i. Carefully investigated and considered the scope of services to be
performed;
ii. Carefully considered how the services should be performed; and
iii. Understands the facilities, difficulties, and restrictions attending
performance of the services under this Agreement.
B. If services involve work upon any site, CONSULTANT agrees that
CONSULTANT has or will investigate the site and is or will be fully acquainted
with the conditions there existing, before commencing the services hereunder.
Should CONSULTANT discover any latent or unknown conditions that may
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materially affect the performance of the services, CONSULTANT will
immediately inform CITY of such fact and will not proceed except at
CONSULTANT's own risk until written instructions are received from CITY.
8. TERM. The term of this Agreement will be from Jan. 1. 2009, to Dec. 31, 2011. Unless
otherwise determined by written amendment between the parties, this Agreement will terminate
in the following instances:
A. Completion of the work specified in Exhibit"A";
B. Termination as stated in Section 16.
9. TIME FOR PERFORMANCE.
A. CONSULTANT will not perform any work under this Agreement until:
i. CONSULTANT furnishes proof of insurance as required under Section 23
of this Agreement; and
ii. CITY gives CONSULTANT a written notice to proceed.
B. Should CONSULTANT begin work on any phase in advance of receiving written
authorization to proceed, any such professional services are at CONSULTANT's
own risk.
10. TIME EXTENSIONS, Should CONSULTANT be delayed by causes beyond
CONSULTANT's control, CITY may grant a time extension for the completion of the contracted
services. If delay occurs, CONSULTANT must notify the Manager within forty-eight hours (48
hours), in writing, of the cause and the extent of the delay and how such delay interferes with the
Agreement's schedule. The Manager will extend the completion time, when appropriate,for the
completion of the contracted services.
11. CONSISTENCY. In interpreting this Agreement and resolving any ambiguities,the main
body of this Agreement takes precedence over the attached Exhibits; this Agreement supersedes
any conflicting provisions. Any inconsistency between the Exhibits will be resolved in the order
in which the Exhibits appear below:
A. Exhibit A: Scope of Work;
B. Exhibit B: Budget; and
C. Exhibit C: Proposal for Services.
12. CHANGES. CITY may order changes in the services within the general scope of this
Agreement, consisting of additions, deletions, or other revisions, and the contract sum and the
contract time will be adjusted accordingly. All such changes must be authorized in writing,
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executed by CONSULTANT and CITY. The cost or credit to CITY resulting from changes in
the services will be determined in accordance with written agreement between the parties.
13. TAXPAYER IDENTIFICATION NUMBER. CONSULTANT will provide CITY with a
Taxpayer Identification Number.
14. PERMITS AND LICENSES. CONSULTANT, at its sole expense, will obtain and
maintain during the term of this Agreement, all necessary permits, licenses, and certificates that
may be required in connection with the performance of services under this Agreement.
15, WAIVER. CITY's review or acceptance of, or payment for, work product prepared by
CONSULTANT under this Agreement will not be construed to operate as a waiver of any rights
CITY may have under this Agreement or of any cause of action arising from CONSULTANT's
performance. A waiver by CITY of any breach of any term, covenant, or condition contained in
this Agreement will not be deemed to be a waiver of any subsequent breach of the same or any
other tern, covenant, or condition contained in this Agreement, whether of the same or different
character.
16. TERMINATION.
A. Except as otherwise provided, CITY may terminate this Agreement at any time
with or without cause.
B. CONSULTANT may terminate this Agreement at any time with CITY's mutual
consent. Notice will be in writing at least thirty (30) days before the effective
termination date.
C, Upon receiving a termination notice, CONSULTANT will immediately cease
performance under this Agreement unless otherwise provided in the termination
notice. Except as otherwise provided in the termination notice, any additional
work performed by CONSULTANT after receiving a termination notice will be
performed at CONSULTANT" own cost; CITY will not be obligated to
compensate CONSULTANT for such work.
D. Should termination occur, all finished or unfinished documents, data, studies,
surveys, drawings, maps, reports and other materials prepared by CONSULTANT
will, at CITY's option, become CITY's property, and CONSULTANT will
receive just and equitable compensation for any work satisfactorily completed up
to the effective date of notice of termination, not to exceed the total costs under
Section 1(C).
E. Should the Agreement be terminated pursuant to this Section, CITY may procure
on its own terms services similar to those terminated.
F. By executing this document, CONSULTANT waives any and all claims for
damages that might otherwise arise from CITY's termination under this Section.
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17. OWNERSHIP OF DOCUMENTS. All documents, data, studies, drawings, maps, models,
photographs and reports prepared by CONSULTANT under this Agreement are CITY's
property. CONSULTANT may retain copies of said documents and materials as desired, but
will deliver all original materials to CITY upon CITY's written notice. CITY agrees that use of
CONSULTANT's completed work product, for purposes other than identified in this Agreement,
or use of incomplete work product, is at CITY's own risk.
18. PUBLICATION OF DOCUMENTS. Except as necessary for performance of service
under this Agreement, no copies, sketches, or graphs of materials, including graphic art work,
prepared pursuant to this Agreement, will be released by CONSULTANT to any other person or
public CITY without CITY's prior written approval. All press releases, including graphic
display information to be published in newspapers or magazines, will be approved and
distributed solely by CITY, unless otherwise provided by written agreement between the parties.
19. INDEMNIFICATION.
A. CONSULTANT agrees to the following:
i. Indemnification for Professional Services. CONSULTANT will save
harmless and indemnify and at CITY's request reimburse defense
costs for CITY and all its officers, volunteers, employees and
representatives from and against any and all suits, actions, or claims,
of any character whatever, brought for, or on account of', any injuries
or damages sustained by any person or property resulting or arising
from any negligent or wrongful act, error or omission by
CONSULTANT or any of CONSULTANT's officers, agents,
einployees, or representatives,in the performance of this Agreement.
ii. Indemnification for other Damages. CONSULTANT indemnifies and
holds CITY harmless from and against any claim, action, damages,
costs (including, without limitation, attorney's fees), injuries, or
liability, arising out of this Agreement, or its performance. Should
CITY be named in any suit, or should any claim be brought against it
by suit or otherwise, whether the same be groundless or riot, arising
out of this Agreement, or its performance, CONSULTANT will
defend CITY (at CITY's request and with counsel satisfactory to
CITY) and will indemnify CITY for any judgment rendered against it
or any sums paid out in settlement or otherwise.
B. For purposes of this section "CITY" includes CITY's officers, officials,
employees, agents, representatives, and certified volunteers.
C. It is expressly understood and agreed that the foregoing provisions will survive
termination of this Agreement.
D. The requirements as to the types and limits of insurance coverage to be
maintained by CONSULTANT as required by Section 23, and any approval of
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said insurance by CITY, are not intended to and will not in any manner limit or
qualify the liabilities and obligations otherwise assumed by CONSULTANT
pursuant to this Agreement, including, without limitation, to the provisions
concerning indemnification.
20. ASSIGNABILITY. This Agreement is for CONSULTANT's professional services.
CONSULTANT's attempts to assign the benefits or burdens of this Agreement without CITY's,
written approval are prohibited and will be null and void.
21. INDEPENDENT CONTRACTOR. CITY and CONSULTANT agree that
CONSULTANT will act as an independent contractor and will have control of all work and the
manner in which is it performed. CONSULTANT will be free to contract for similar service to
be performed for other employers while under contract with CITY. CONSULTANT is not an
agent or employee of CITY and is not entitled to participate in any pension plan, insurance,
bonus or similar benefits CITY provides for its employees. Any provision in this Agreement that
may appear to give CITY the right to direct CONSULTANT as to the details of doing the work
or to exercise a measure of control over the work means that CONSULTANT will follow the
direction of the CITY as to end results of the work only.
22. AUDIT OF RECORDS. CONSULTANT will maintain full and accurate records with
respect to all services and matters covered under this Agreement. CITY will have free access at
all reasonable times to such records, and the right to examine and audit the same and to make
transcript therefrom, and to inspect all program data, documents, proceedings and activities.
CONSULTANT will retain such financial and program service records for at least three (3) years
after termination or final payment under this Agreement.
23. INSURANCE.
A. Before commencing performance under this Agreement, and at all other times this
Agreement is effective,CONSULTANT will procure and maintain the following
types of insurance with coverage limits complying, at a minimum, with the limits
set forth below:
Type of Insurance Limits
Commercial General Liability: $1,000,000
Professional Liability $1,000,000
Business Automobile Liability $1,000,000
Workers Compensation Statutory requirement
B. Commercial general liability insurance will meet or exceed the requirements of
ISO-CGL Form No. CG 00 01 1185 or 88. The amount of insurance set forth
above will be a combined single limit per occurrence for bodily injury,personal
injury, and property damage for the policy coverage. Liability policies will be
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endorsed to name CITY,its officials, and employees as "additional insureds"
under said insurance coverage and to state that such insurance will be deemed
"primary" such that any other insurance that may be carried by CITY will be
excess thereto. Such endorsement must be reflected on ISO Form No. CG 20 10
11 85 or 88, or equivalent. Such insurance will be on an"occurrence," not a
"claims made,"basis and will not be cancelable or subject to reduction except
upon thirty (30) days prior written notice to CITY.
C. Professional liability coverage will be on an "occurrence basis" if such coverage
is available, or on a"claims made"basis if not available. When coverage is
provided on a"claims made basis," CONSULTANT will continue to renew the
insurance for a period of three (3) years after this Agreement expires or is
terminated. Such insurance will have the same coverage and limits as the policy
that was in effect during the term of this Agreement, and will cover
CONSULTANT for all claims made by CITY arising out of any errors or
omissions of CONSULTANT, or its officers, employees or agents during the time
this Agreement was in effect.
D. Automobile coverage will be written on ISO Business Auto Coverage Form CA
00 0106 92,including symbol 1 (Any Auto).
E. CONSULTANT will furnish to CITY duly authenticated Certificates of Insurance
evidencing maintenance of the insurance required under this Agreement and such
other evidence of insurance or copies of policies as may be reasonably required
by CITY from time to time. Insurance must be placed with insurers with a current
A.M. Best Company Rating equivalent to at least a Rating of"A:VII."
F. Should CONSULTANT, for any reason, fail to obtain and maintain the insurance
required by this Agreement,CITY may obtain such coverage at
CONSULTANT's expense and deduct the cost of such insurance from payments
due to CONSULTANT under this Agreement or terminate pursuant to Section 16,
24. USE OF SUBCONTRACTORS. CONSULTANT must obtain CITY's prior written
approval to use any consultants while performing any portion of this Agreement. Such approval
must approve of the proposed consultant and the terms of compensation.
25. INCIDENTAL TASKS. CONSULTANT will meet with CITY monthly to provide the
status on the project, which will include a schedule update and a short narrative description of
progress during the past month for each major task, a description of the work remaining and a
description of the work to be done before the next schedule update.
26. NOTICES. All communications to either party by the other party will be deemed made
when received by such party at its respective name and address as follows:
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f � �
If to CONSULTANT: If to CITY:
SCRMA
750 The City Drive, Suite 350 City of El Segundo
Orange,CA 92868 350 Main Street
El Segundo,CA 90245
Attention: Jody Gray, President Attention: Bob Hyland,
Director of Human Resources
Any such written communications by mail will be conclusively deemed to have been received by
the addressee upon deposit thereof in the United States Mail, postage prepaid and properly
addressed as noted above. In all other instances, notices will be deemed given at the time of
actual delivery. Changes may be made in the names or addresses of persons to whom notices are
to be given by giving notice in the manner prescribed in this paragraph.
27. CONFLICT OF INTEREST. CONSULTANT will comply with all conflict of interest
laws and regulations including, without limitation,CITY's conflict of interest regulations.
28. SOLICITATION. CONSULTANT maintains and warrants that it has not employed nor
retained any company or person, other than CONSULTANT's bona fide employee, to solicit or
secure this Agreement. Further, CONSULTANT warrants that it has not paid nor has it agreed
to pay any company or person, other than CONSULTANT's bona fide employee, any fee,
commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting
from the award or making of this Agreement. Should CONSULTANT breach or violate this
warranty, CITY may rescind this Agreement without liability.
29. THIRD PARTY BENEFICIARIES. This Agreement and every provision herein is
generally for the exclusive benefit of CONSULTANT and CITY and not for the benefit of any
other party. There will be no incidental or other beneficiaries of any of CONSULTANT's or
CITY's obligations under this Agreement.
30. INTERPRETATION. This Agreement was drafted in, and will be construed in accordance
with the laws of the State of California, and exclusive venue for any action involving this
agreement will be in Los Angeles County.
31. COMPLIANCE WITH LAW. CONSULTANT agrees to comply with all federal, state,
and local laws applicable to this Agreement.
32. ENTIRE AGREEMENT. This Agreement, and its Attachments, sets forth the entire
understanding of the parties. There are no other understandings, terms or other agreements
expressed or implied, oral or written. There are three (3) Attachments to this Agreement. This
Agreement will bind and inure to the benefit of the parties to this Agreement and any subsequent
successors and assigns.
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33. RULES OF CONSTRUCTION. Each Party had the opportunity to independently review this
Agreement with legal counsel. Accordingly, this Agreement will be construed simply,as a whole,
and in accordance with its fair meaning;it will not be interpreted strictly for or against either Party.
34. SEVERABILITY. If any portion of this Agreement is declared by a court of competent
jurisdiction to be invalid or unenforceable, then such portion will be deemed modified to the
extent necessary in the opinion of the court to render such portion enforceable and, as so
modified, such portion and the balance of this Agreement will continue in full force and effect.
35. AUTHORITY/MODIFICATION. The Parties represent and warrant that all necessary
action has been taken by the Parties to authorize the undersigned to execute this Agreement and to
engage in the actions described herein. This Agreement may be modified by written amendment.
CITY's executive manager, or designee,may execute any such amendment on behalf of CITY.
36. ACCEPTANCE OF FACSIMILE SIGNATURES. The Parties agree that this Agreement,
agreements ancillary to this Agreement, and related documents to be entered into in connection
with this Agreement will be considered signed when the signature of a party is delivered by
facsimile transmission. Such facsimile signature will be treated in all respects as having the
same effect as an original signature.
37. CAPTIONS. The captions of the paragraphs of this Agreement are for convenience of
reference only and will not affect the interpretation of this Agreement.
38. TIME IS OF ESSENCE. Time is of the essence for each and every provision of this
Agreement.
39. FORCE MAJEURE. Should performance of this Agreement be prevented due to fire, flood,
explosion,acts of terrorism, war,embargo, government action, civil or military authority,the
natural elements,or other similar causes beyond the Parties' reasonable control,then the
Agreement will immediately terminate without obligation of either party to the other.
40. STATEMENT OF EXPERIENCE. By executing this Agreement, CONSULTANT
represents that it has demonstrated trustworthiness and possesses the quality, fitness and capacity
to perform the Agreement in a manner satisfactory to CITY. CONSULTANT represents that its
financial resources, surety and insurance experience, service experience, completion ability,
personnel, current workload, experience in dealing with private consultants, and experience in
dealing with public agencies all suggest that CONSULTANT is capable of performing the
proposed contract and has a demonstrated capacity to deal fairly and effectively with and to
satisfy a public CITY.
[Signatures on next page]
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IN WITNESS WHEREOF the parties hereto have executed this contract the day and year
first hereinabove written.
CITY OF EL SEGUNDO
a ge I city,
c Wayt,
City Maria er Jody 14 -C'Q
ATTEST:
ly
Taxpayer ID No. 6 -13-7 -
Cindy Mort en,
City Clerk
APPROVED 0 FORM:A
MIARK-b.' ENS XY, City Mto n y
By:
Karl H. Berger, Assistant City Attorney
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E%IIEBIT A
Attachment A
i+cooe of Services—Claims Administration
The City of El Segundo is interested in obtaining a TPA who will be able to
favorably respond to the following performance objectives and be
contractually committed to comply with the following, but not limited to,
performance standards:
1. Caseload; Each examiner shall have an average caseload not to
exceed 150 open indemnity claims. Open Indemnity claims include
future medical claims. Each claims assistant shall have a caseload not
to exceed 150 open medical only claims. The supervisor shall have a
caseload not to exceed 30 open indemnity claims. The TPA shall
provide a computer generated monthly caseload report to the City of El
Segundo'"s Director of Duman resources for all examiners handling El
Segundo claims.
2. Forms: The TPA shall provide all forms necessary for the processing of
benefits or claims information Including the Employer's report of Injury,
tWC Form 1, return to Work Slips, vouchers, checks, and ether
related forms. These formes shall be provided electronically if requested.
The cost of providing these forms shall be included within the contract
price.
3. Claim File Set Up and Diarv. Review: Upon receipt of the Employer's
Report of Injury, the TPA will prepare an individual claim file within two
(2) working days for each claim. Preparation of the claim file shall
include entering each new claim into the computer system and
establishing appropriate reserves. All claim files shall be reviewed at
least every forty-five (45) calendar days for active claims and at least
every six (6) months for claims that have settled but are open for feature
medical care. The examiner shall distinguish the regular diary review
from routine file documentation in the computer, notepad. A plan of
action will be included and separately labeled In the file notes during a
diary review. The supervisor shall monitor the diary reviews by printing
a "No Activity" report each month to identify any files that have fallen off
the diary system.
4. Future Medical Claims: Future medical claims shall remain open for
two (2) gears from the lust payment of benefit. Reviews shall be
documented in the claim notes to include settlement Information, future
medical care outline, last date and type of treatment, name of excess
carrier, excess carrier reporting level, and excess carrier reporting
history. U 31
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5, EmDlover Contact: The TPA shall contact the City of El Segundo within
one (1) working day of receipt of notice of a lost time claim by any
source. Such contact shall be documented to the computer notepad
after the claim has been created in the system,
The TPA shall request the Employer's Report of Injury form when or if
notification of an injury or incident by any source is received first (i,e.,
Application of Adjudication, notice of legal representation, Doctor's First
Report of Injury, etc.).
The TPA will confirm the DW"C 'Form 1 was given to the employee
within one (1) working day of knowledge of the injury. If'there is no
evidence the form was provided, the TPA wilt provide the form with the
initial contact letter to the employee within three O business days of
receiving the claim.
When a claim reaches or exceeds one half of the member's SIR In total
Incurred value, the TPA shall report to the City of El Segundo's Director
of Human Resources, every ninety (90) days regarding the status of the
claim. Such information shall be reported in an approved Status Report
form and include the examiner's plan of action for the future handling of
the claim.
The examiner will provide on-site file reviews quarterly unless otherwise
requested. Other periodic on-site file reviews will be scheduled based
upon the needs of the City of El Segundo.
6. Emolovee Contact: In all' non-litigated, lost time cases where, the
employee has not returned to work„ telephone or personal contact will
be established with the injured' employee within one (1) working day of
receipt of notice of claim. Such contact will continue as often as
necessary, but at least monthly until the employee returns to work.
Such contact with the employee shall be documented in the computer
notepad.
Return phone calls to employees will be accomplished within one (1)
working day.
All correspondence from employees will be responded to within five (5)
days of receipt.
7> Reserves; Reserves shall be established based upon the ultimate
probable cast of each claim. All reserve categories shall be reviewed
on a regular basis but at least every ninety (90) days. Such review
shall be Indicated' in the computer notepad. Any changes to reserves
shall include an explanation for the change.
A claims assistant shall have authority to establish reserves not to
exceed $3,000. An examiner shall have authority to establish reserves
not to exceed $50,000. A senior examiner shall have authority to
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establish reserves not to exceed $75,000. The supervisor shall have
authority to establish reserves not to exceed $150,000. A claims
manager, vice president, or president of the TPA shall review and
approve all reserves in excess of $150,000.
8. Pavrnents: The City of El Segundo has established a positive pay
sweep account, which shall at all times contain sufficient funds to
enable the TPA to make timely payments of claims, allocated loss
expenses, and other amounts the TPA is authorized or required to
make on behalf of the City of El Segundo, The TPA shall electronically
submit the information required by the City of El Segundo's financial
institution on a daily, weekly, or monthly basis. The submissions will be
at no additional cost to the City of EI Segundo.
9. Medical AdmInistr#on: Absent a Medical Provider Network, the TPA
shall assist in the selection of a panel of general practitioners,
specialists, hospitals, and emergency treatment facilities to which
injured employees should be referred, as approved by the City of El
Segundo, and the TPA shall regularly review and update the panel.
The physician's office will be contacted within five (5) days of notice of
all new Indemnity claims. Such contact will continue as needed during
the continuation of temporary dis ability to assure that treatment is
related to a compensable injury or illness. All contact shall be
documented in the computer notepad.
The TPA shall maintain contact with treating physicians to ensure
employees receive proper medical treatment and are returned to full or
modified employment at the earliest possible date.
The TPA shall maintain direct contact with medical service providers to
ensure their reports are received in a timely manner.
The TPA shall arrange medical evaluations when needed, reasonable,
and/or requested in compliance with the current Labor Code.
The TPA shall ensure that medical bills are reduced to the
recommended rates established by the Administrative Director of
Workers' Compensation. The use of a service contractor must be
approved by the City of El Segundo. The City of El Segundo shall pay
for the use and benefits of the services provided.
The TPA shall ensure that utilization review and/or professional
managed care services will be provided on an as-needed basis to
injured employees by providers approved by the City of El Segundo.
10. Medical Pavrnents: Medical bills will be reviewed for correctness,
approved for payment, and paid within time limits established by Labor
Code section 46032, If all or part of the bill is being disputed, the TPA
will notify the medical provider, on the appropriate form letter, within
time limits established by Labor Code 4603.2. 033
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11. Plan of Action„ Each claim file shall contain the examiner's plan of
action for the future handling of that claim. Such plan of action shall be
clearly stated including the reasoning for the plan. The plan of action
will be updated at least every forty-five (45) calendar days and clearly
identified in the computer notepad.
12. Investi aoc�: The TPA shall promptly initiate investigation of issues
identified as material to potential litigation. The member shall be
alerted to the need for an outside investigation as soon as possible and
the examiner shall appoint an investigator who is acceptable to the
member. The member shall be kept informed on the scope and results
of all investigations.
The TPA shall subscribe to the Index Bureau. Costs to subscribe to
this Index Bureau shall be included in proposed pricing structure. The
examiner shall request a report from the Index Bureau on all new
indemnity claims. Subsequent requests should be made every six (6)
to twelve (12) months thereafter on all active indemnity claims.
13. Comoensability: The compensability determination (accept claim, deny
claim, or delay acceptance pending the results of additional
investigation) and the reasons for such determination will be made and
clearly documented in the computer notepad within five (5) working
days of the receipt of the notification of the loss. Delay or denial of
benefit letters shall be mailed in compliance with the Division of
Industrial Relations' guidelines. The TPA shall notify the member of
delay or denial of any claim.
In no case shall a final compensability decision be extended beyond
ninety (90) days from the member city's knowledge of the claim.
14, Provision of 'Benefits: The TPA shall provide all compensation and
medical benefits in a timely manner and in compliance with the
statutory requirements of the California Labor Code. The TPA shall
compute and pay temporary disability benefits to injured employees
based upon earnings information and authorized disability periods. The
TPA shall review, compute, and pay all informal ratings, death benefits,
Findings and Awards, life pensions, or Compromise and Release
settlements.
15. Initial Indemnity P vment: The initial indemnity payment or voucher will
be issued and mailed to the injured employee together with properly
completed DWC notices within fourteen (14) days of the first day of
disability.
Late payments must include the 10% self-imposed penalty in
accordance with Labor Code section 4650. Penalties must be reported
to the City of El Segundo's Director of Human Resources.
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16. Sybgquent Indemnitv Pa mom: All indemnity payments or vouchers
subsequent to the first payment will be verified, except for obvious long-
term disability, and issued in compliance with Labor Code section 4651.
Late payments must include the 10% self-imposed penalty in
accordance with Labor Code section 4650.
17. Return to Work: The TPA shall provide assistance to the City of El
Segundo in returning injured employees to modified duty while
recovering and prior to their return to regular duties.
The TPA shall consult frequently with the Director of Human Resources
in those cases where the injury residuals might involve permanent work
restrictions and/or retirement potential.
18. Transoortation Exoense: Transportation reimbursement will be mailed
within five (5) days of the receipt of the claim for reimbursement.
Advance travel expense payments will be mailed to the injured
employee ten (10) days prior to the anticipated date of travel.
19. Permanent Disability: The TPA shall explain and assist injured
employees in completing the necessary forms to obtain a permanent
disability rating.
The TPA shall determine the nature and extent of permanent disability
and arrange for an Informal disability rating whenever possible to avoid
Workers'Compensation Appeal, Board litigation.
All permanent disability benefit notices shall be sent to the employee as
required by the Labor Code.
20. Litioated Cases: The City of El Segundo shall be aierted to the need
for an outside counsel as soon as possible„ and the examiner shall
appoint an attorney who is acceptable to the City of El Segundo.
When defense counsel Is not necessary, the TPA shall words closely
with the applicant's attorney in informal disposition of litigated'cases.
Settlement proposals directed to the City of El Segundo shall be
forwarded by the TPA or defense counsel in a concise and clear written
form with a reason(s) for such recommendation.
All preparation for a trial shall involve the City of El Segundo so that all
material evidence and witnesses are utilized to obtain a favorable result
for the defense.
The manager, supervisor, or examiner shall attend Workers'
Compensation Appeals Board hearings, rehabilitation hearings,
meetings with defense counsel, and meetings with member's staff,
departments, and employee groups as necessary and as requested to
do so.
-$ - 035
.... 3 8 2 . a. .,.
21. Settlements: The TPA shall obtain the City of El Segundo's written
authorization on all settlements. All requests for settlement authority
shall include a written claim summary, current financial information,
estimate of permanent disability, and the defense counsel's comments
and recommendations.
22. Subrogation: In all cases where a third party is responsible for the
injury to the employee, the TPA shall contact the member indicating
they will pursue subrogation unless instructed otherwise by the City of
El Segundo. When subrogation is to be pursued, the third party shall
be contacted within ten (10) days of identification, with notification of
the City of El Segundo's right to subrogation and the recovery of certain
claim expenses. If the third party is a governmental entity, a claim shall
be filed with the governing board within six (6) months of the injury or
notice of injury.
Periodic contact shall be made with the responsible party and/or insurer
to provide notification of the amount of the estimated recovery to which
the member will be entitled.
If the injured worker brings a civil action against the parry responsible
for the injury, the TPA shall consult with the City of El Segundo about
the value of the subrogation claim and other considerations. Upon the
City of El Segundo's authorization, subrogation counsel shall be
assigned to file a Lien or a Complaint in Intervention in the civil action.
Whenever practical, the TPA should take advantage of any settlement
in a civil action by attempting to settle the Workers' Compensation
Claim by means of a Third Party Compromise and release„ If such
attempt does not succeed, then every effort should be made through
the Workers' Compensation Appeals Board to offset claim expenses
through a credit against the proceeds from the injured worker's civil
action,
23. Vocational Rehabilitation: In accordance with all applicable California
laws in place at the date of injury, the TPA shall:
1. Determine the Qualified Injured Worker/Non Qualified Injured
Worker status;
2. Advise the injured worker of his/her right to rehabilitation benefits;
3. Provide appropriate vocational rehabilitation benefits;
4. Control rehabilitation costs; and
5. Attempt to secure the prompt conclusion of vocational rehabilitation
benefits.
24. Claim Reconciliation; All claim files shall be reconciled to ensure all
indemnity payments have been made correctly. The reconciliation
should verify that payment amounts were correct, paid on the
appropriate claim file, and all benefit notices were issued accordingly.
The physical file should be verified with the computer information. All
open claim files shall be reconciled at the time of a request for
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38 b , -
2 t 0•
settlement authorization and at the time of submission for closure.
Proof of the reconciliation should remain in the claim file.
25. Excess Insurance: Cases that have the potential to exceed or have
reached 50% of the City of El Segundo's self-insured retention level
should be reported to the City of El Segundo's Director of Human
Resources. Any case that has the potential to exceed or have reached
50% of the City of El Segundo's self-insured retention shall be reported
to the City of El Segundo and the excess insurer in accordance with the
reporting criteria established by the excess insurer. All cases that meet
the established reporting criteria are to be reported within five (5) days
of the day on which it is known the criterion is met.
26. Award P'a ment: Payments on awards, computations, or Compromise
and Release agreements will be issued within ten (10) days or sooner if
necessary to ensure payment within twenty (20) days of the Workers'
Compensation Appeals Board approval date, following receipt of the
appropriate document.
27. Penalties: Late payment of all benefits must include the self-imposed
penalty in accordance with California law. The City of El Segundo will
be provided a listing of any administrative penalties paid during the
month, which were the responsibility of the TPA, and a check from the
TPA payable to the City of El Segundo for reimbursement. The check
and report shall be submitted to the City of El Segundo by the 20"' of
the following month.
28. Case Closure: The supervisor must review all medical only claims
open beyond ninety (90) days from the date of entry by the TPA, for
potential closure or conversion to indemnity claim status. Claims with
$3,000 or more paid to date and any claim open beyond one hundred
eighty days (180) from date of entry must be converted to indemnity
status and a reasonable, precautionary indemnity reserve placed on the
claim(s). All indemnity cases where permanent disability is not an Issue
will be closed within sixty (60) days of the final financial transaction or
final correspondence to the injured worker as required by law. All
indemnity claims where permanent disability is an issue will remain
open for two (2) years from the last payment of benefit and then closed
within sixty (60) days of that date. The TPA will monitor stipulated
cases with future medical provisions. Reserves for future medical will
be reviewed semi-annually and adjusted according to use.
29. Status Repgr_W Special claim status reports requested by members
outside the regular ninety (90) day status reports shall be provided by
the TPA to the City of El Segundo within ten (10) business days.
Verbal status reports requested by members shall be provided by the
TPA to the respective member within two (2) business days. Special
computer generated loss data reports requested by members shall be
provided within seven (7) business days.
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5882
30. toss Rams and Check Runs: The TPA shall provide the applicable
computer reports by the 7'" calendar day of the following month to the
City of El Segundo.
31, Claims Reoortino* The TPA shall maintain all loss information as
required by the Workers' Compensation Insurance Rating Bureau.
The TPA shall assist in the preparation of all reports that are now, or
will be required by the State of California or other government agencies
with respect to self-insurance programs. The TPA will also assist in the
preparation of all reports or databases required by the California
Institute for Public Risk Analysis (CIPRA) or other statistical database
organizations as requested by the City of El Segundo.
32, Record Retention: All claim files shall be maintained in accordance
with statutory time requirements and the City of El Segundo shall be
notified prior to any destruction of files,
33. Claim ,Suoervision: The TPA shall provide supervisory staff that will
regularly review the work product of the claims examiners. The
supervisor shall review at least 10% of each examiner's caseload each
month to ensure each examiner is following the performance standards
outlined in this document. Such reviews shall be labeled as
"Supervisor Review" and clearly documented in the claim notepad. In
addition, the supervisor shall conduct a regular quarterly review of all
open indemnity claims with reserves in excess of $100,000 and all
problem or complex claims.
34. Availabilitv of Personnel: The TPA shall ensure at least one (1) or more
of the examiners assigned to the City of El Segundo are on-site and
available to the City of El Segundo and its members every business
day (excluding holidays) between the hours of 7:30 a.m. and 5:30 p.m.
throughout the term of the approved contract between the City of El
Segundo and the TPA. The TPA shall provide a toll-free telephone
number.
35. Examiner Training: The TPA shall annually certify to the City of El
Segundo that each claims examiner handling the members' claims is in
compliance with all legal and regulatory licensing and continuing
educational requirements as presently or in the future shall be
promulgated and required by the State of California. Where required by
law or regulation, copies of all such certifications shall be provided at
least annually by the TPA to the City of E( Segundo.
36. Member Services: The TPA shall provide special on-site training
services when requested by the City of El Segundo to ensure the city's
supervisory staff process workers' compensation claims effectively,
carrying out the procedures required for a successful program.
The TPA shall require one of the dedicated unit examiners to meet with
the City of El Segundo's personnel, at the member's location, at least
- I1 - 038
3882 . A
once annually to review program procedures regarding workers'
compensation reporting requirements and other program matters that
require the timely participation of the city's personnel.
The TPA shall require an examiner to be available and readily respond
to a member's request for assistance with problem cases, including on-
site visits to the City of El Segundo.
The TPA shall provide the City of El Segundo with information
regarding statutes, proposed changes to statutes, and changes to the
rules and regulations affecting the City of El Segundo and its
responsibility as a legally self-insured workers' compensation public
entity.
37. Comouter Access. The TPA shall provide online access at no
additional charge for the City of El Segundo, as well as additional
access for selected vendors providing services to the City of El
Segundo. The TPA shall provide training for use of the computer
system at no additional charge.
38. Emolovee Services: As required, the TPA will develop, for review by
the City of El Segundo, materiels which will provide information and
guidance to the City of El Segundo Director of Human Resources
regarding workers' compensation and the self-insurance program.
As required, the TPA will assist injured employees in resolving
problems that arise from injury or illness claims.
39. Conflict of interest: The TPA shall avoid all conflicts of interest or
appearance of conflicts of interest in performance of this document. If
the TPA receives compensation from the City of El Segundo for
services not included in this document, such as bill review services,
managed care, or investigations, the TPA shall disclose all fees
received from the City of El Segundo. Such disclosure shall be in the
form of a letter and shall be received by the City of El Segundo each
April 1St
40. Swill Review Services. Provide for comprehensive medical bill review,
in-patient hospital and outpatient facility bill reviews, negotiated bills,
professional surgical fees, line audit bills, duplicate bills, in addition to
re-evaluation/provider inquiries, expert testimony in defense of reviews,
EDl (Electronic Date Interface), on-line access to the system and
monthly reports, and resolution to disputes by providers.
41. Utilization Review Services. Provide comprehensive utilization review
services, identified in an approved Utilization Review Plan, in
compliance with Labor Code Section 4610, defined Utilization Review
Regulations and Timelines, and all directives from the Administrative
Director of the Division of Workers' Compensation.
- >z -
039
58 82
B. Scope of Services — Bill Review
Provide responses in the order of the following items:
1. Provide your price quotation for bill review services. Your
proposal should include a quote for flat fee per bill, a per line
quote (explain if you will accept a maximum and minimum line
charge and if you will charge for headers on each review), and a
quote for percentage of savings including but not limited to
reviewable bills, in-patient hospital and outpatient facility bill
reviews, negotiated bills, professional surgical fees, line audit
- 24 -
3882 . ,
bills, duplicate bills, in addition to re-evaluation/provider inquiries,
expert testimony in defense of reviews, EDI (Electronic Data
Interface), and on-line access to the system.
2. An estimate of the average gross percentage of savings that
would occur on an annual basis.
3. Identify Preferred Provider Organization (PPO) savings from fee
schedule savings and total savings.
4. Do you have a guaranteed turnaround time?
5. What is your average turnaround time of your bills for the 1St 2nd
Td, and 4th quarters of 20049
6. Provide your accuracy ratio or other basis that supports the
accuracy of your bill review service.
7. Indicate if your company currently subcontracts or has
subsidiaries for PPO networks. If so, please provide a list or
description of the PPO networks, Additionally, please provide
information on the types of PPO discounts and related charges or
discounts that can be expected from such services.
8. Do you lease, own, or contract any of your bill review services or
systems?
9. How often is your bill review system updated with fee schedule
changes?
10. Do you plan to provide courier service for the pick-up and delivery
of invoices or electronic interface? If so, how often?
11 . Describe how disputes by providers are resolved and include
what information is sent to providers to justify your bill reduction or
rejections.
12. Is your system capable of printing a user-defined explanation on
the Explanation of Benefits form?
13. What review procedures do you have in place for medical bills
with missing or invalid International Classification of Diseases
(ICD) 9 codes and missing or invalid procedure codes?
14. Describe the mechanism for identifying inappropriate billing
patterns,
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3882 • a
15. Describe your capabilities for tracking the twenty four (24) visit
capitation on physical therapy, chiropractic, and occupational
therapy. Is it a manual or automated process? Does the TPA
have the ability to override the process and, if so, how is this
accomplished?
16. Describe in detail your scanning capabilities as well as internet
access of reviewed bills.
17. Describe your implementation of your services with the claims
administrator(s).
1& Describe your ability to interface with an automated claims
system.
19. Does your system have the ability to monitor the following:
• Unbundling
• Upcoding
• Assistant surgeon
• Duplicate billing
20. Indicate the types of monthly reports that would be provided to the
City of El Segundo. Please provide a description and attach
samples of your reports.
21. Does your software program provide the following:
• Ad hoc report capability?
• Reports on percentage of network"hits"?
• Comparison of billed costs, cost reduction, and net savings?
22. Should the City of El Segundo implement a Medical Provider
Network (MPN), please describe in detail what reports you can
provide to document the MPN savings. 'Would there be an
additional charge for this service?
23. Do you have a pharmacy program? If so, please describe your
pharmacy program in detail. Do you offer a mail order and card
program?
24. Do you have a diagnostic service program? If so, please describe
in detail your diagnostic services including average percentage
savings below fee schedule.
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3882
B. Scope of Services - Utilization Review
Provide answers in the order of the following:
1. How do you propose to charge for services? Provide flat fee and
hourly rates including but not limited to screening by nurse case
manager, set up, utilization review, inpatient certification,
outpatient certification, peer review, and peer to peer review.
2: How will you assist the City of El Segundo with developing the
written policies and procedures of the utilization review plan for
filing with the Administrative Director of the Division of Workers'
Compensation? Provide a sample of a utilization review plan.
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3882 , � e
3. Describe your utilization review system including interaction with
workers' compensation TPA's, bill review vendors, medical and
service providers, employers, and patients. What type of training
do you provide to the TPA?
4. Frequency of visits and training of the TPA?
5. Specify what type of company personnel are assigned to conduct
utilization reviews including nurses and Medical Director?
6. How many of your case managers have Certified Occupational
Health Nurse (C 9HN) or Certified Case Manager (CCM)
certifications? low many are bilingual in Spanish? Please
provide resumes of designated case management staff.
7. Describe in detail your clerical staff function and how it relates to
review of a case.
8. Describe your physician peer review programs and utilization
protocols.
9. Describe your process to guarantee compliance with the
Utilization Review timelines set forth in the Labor code.
10. Provide samples of your reports that would be provided to
employers and/or the TPA. Does this include hard and soft
savings? Does it include turn around time of reviews?
11. Describe your recommended protocol for TPA's to use to approve
medical treatment requests. When should treatment requests be
sent to your firm for review?
12. Describe how your system handles requests for reconsiderations.
What is the timeline for completion of medical reviews?
13. What tracking mechanisms do you have in place for Peer
Reviews, Referrals, and Appeals?
14. Describe the mechanism for identifying inappropriate utilization
patterns.
15. Indicate what your average turnaround time is for utilization
review. How do you insure utilization reviews are completed in
accordance with the California regulations regarding utilization
review?
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3882 . ,
16. What review procedure is undertaken on requests for pharmacy
services?
17. What method do you use to address long term medication
requests to contain over use and costs?
18. Are you able to electronically invoice the claims administrator?
19. Describe any additional savings available through your
organization.
3882
EXHIBIT B
Attachment B
Schedule of Compensation
Claims Administration
111/2009 - 12/31/2009 $76,750
1/1/2010 - 12/31/2010 $82,500
1/1/2011 - 12/31/2011 $87,750
l/1/2012 - 12/31/2012 Negotiated by the parties, on
1/1/2013 - 12/31/2013 an optional basis.
Utilization Review
5% of medical charges
• Physician Review $200 per hour
• Specialist Review $400
• Nurse Case Management $95 per hour
Bill Review
$6.00 per bill: 12.5% of net savings.
- 13 - 040
C
y/T2
Office of the City Manager
March 2, 2010
Elected Officials: Veronica lbarra, W.C.C.P.
KaftyMoDoweN, Client Relations Director
Mayor York Insurance Services Group, c. - California
Bu
EHc K.Bu sch, l>>
Mayor Pro rem 313 E. Foothill Blvd.
caA n, Upland, CA 91786
CouncIl uncN Member
Blll Flaher,
Councli Member
Don Braun,
Council Member
Cindywriesen, Dear Ms. Ibarra,
City Clerk
Ralph Lanphern
City Tmasurer I am writing to confirm the City of El Segundo has received your correspondence stating
Southern California Risk Management Associates, Inc. ("SCRMA") has merged with its
Appointed officials: affiliated company, Gregory B. Bragg and Associates, Inc. and the corporation will now
Jack myt,interim be know as York Insurance Services Group, Inc. —California.
City Manager
Mark D.Hensley,CltyAttomey As per Agreement#3882;section 20,York Insurance Services, Inc.—California will now
be assigned the benefits and/or burden of this agreement.
Department Directors: If you should have any questions, please contact the Human Resources Department,
am Crowe, Lorraine Ward, HR Analyst, at 310-524-2336.
Assistant City Manager
Deborah Cullen,
Finance
Robert Hyland, Si el
Human Resources
Kevin Smith,
Fire Chief
Debra Brighton,
Library Services
GrePlanin a Jack Wayt
Planning and Building ,
safety City Manager
David Cummings,
Police Chief
Stephanie Katsouleas,
Public Works Cc: Lorraine Ward
Bob Cummings,
Recreation 6 Parks
www.elsegundo.org
350 Main Street, El Segundo, California 90245-3813
Phone(310)524-2301 FAX(310)322-7137
YORK
February 4, 2010
Mr. Robert Hyland
City of E1 Segundo
350 Main Street
El Segundo, CA 90245-3895
Re: SCRMA Re-brand
Dear Mr. Hyland,
Southern California Risk Management Associates, Inc. ("SCRMA") has merged with its
affiliated company, Gregory B. Bragg and Associates, Inc. ("Bragg") and the resulting
corporation will be known as York Insurance Services Group, Inc. - California. SCRMA has
been a subsidiary of York Insurance Services Group, Inc. ("York") for several years now. The
reason for this step is to emphasize that we are a part of the York family of companies and can
draw on the resources of that organization to provide an expanded menu of products and
services in addition to the claims services in California to better meet your needs. It is a merger
and not an operational change. York Insurance Services Group, Inc. - California will carry on
and be fully responsible for all of the commitments and contractual obligations of SCRMA.
Because this is merely a merger, there is no need to create a new contract. York Insurance
Services Group, Inc.—California is, by operation of law, assuming all assets, commitments and
contractual obligations of Southern California Risk Management Associates, Inc. and your
contact information will remain the same. We will insert an item noting the name change in our
next regular contract amendment.
We are excited about this step forward and what it means for the future. If you have any
questions about this, or even if you would just like us to tell you about our expanded
capabilities and how we can use them your meet your claims administration needs, please
contact me at (909) 942-4839 orvia email atrt�i�ictit wb��.dym.li �.cva .
Sincerely,
Veronica Ibarra, W.C.C.P.
Client Relations Director
Enclosure: W-9