HomeMy WebLinkAboutContracts & Agreements_140-2022AGREEMENT TO PERFORM PROFESSIONAL SERVICES
This agreement for the provision of claims adjusting and administration services
("Agreement") is made and entered in this 5th day of July, 2022 ("Effective Date"), by and
between the City of Redlands, a municipal corporation ("City") and George Hills Company, Inc.
a California corporation. ("Consultant"). City and Consultant are sometimes individually referred
to herein as a "Party" and, together, as the "Parties." In consideration of the mutual promises
contained herein, City and Consultant agree as follows:
ARTICLE 1— ENGAGEMENT OF CONSULTANT
1.1 City hereby engages Consultant to provide claims adjusting and administration services for
City (the "Services").
1.2 The Services shall be performed by Consultant in a professional manner, and Consultant
represents that it has the skill and the professional expertise necessary to provide the
Services to City at a level of competency presently maintained by other practicing
professional consultants in the industry providing like and similar types of Services.
ARTICLE 2 — SERVICES OF CONSULTANT
2.1 The Services that Consultant shall perform are more particularly described in Exhibit "A,"
titled "Scope of Services," which is attached hereto and incorporated herein by reference.
2.2 Consultant shall comply with applicable federal, state and local laws and regulations in the
performance of this Agreement including, but not limited to, any applicable State
prevailing wage laws.
ARTICLE 3 — RESPONSIBILITIES OF CITY
3.1 City designates Tommi Ng, Assistant Human Resources/Risk Management Director, as
City's representative with respect to performance of the Services, and such person shall
have the authority to transmit instructions, receive information, interpret and define City's
policies and decisions with respect to performance of the Services.
ARTICLE 4 — PERFORMANCE OF SERVICES
4.1 Consultant shall perform and complete the Services in a prompt and diligent manner in
accordance with the schedule set forth in Exhibit "A," titled "Project Schedule," which is
attached hereto and incorporated herein by reference.
4.2 The term of this Agreement shall be for a period of three (3) years beginning July 5, 2022
(the "Initial Term"). The City shall have the option to extend the Initial Term of this
Agreement by two (2) additional one-year terms (each, an "Extended Term"), on the same
terms and conditions, by providing written notice to Consultant at least thirty (30) days
prior to the expiration of the Initial Term or any Extended Term.
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4.3 If Consultant's Services include deliverable electronic visual presentation materials, such
materials shall be delivered in a form, and made available to the City, consistent with City
Council adopted policy for the same. It shall be the obligation of Consultant to obtain a
copy of such policy from City staff.
ARTICLE 5 — PAYMENTS TO CONSULTANT
5.1 The total annual compensation for Consultant's performance of the Services is specified in
Exhibit B, "Fee Schedule," which is fully incorporated herein. Fees and expenses to be
paid to Consultant shall not exceed the amount of Eighty Thousand Dollars ($80,000) per
fiscal year commencing on the Effective Date, with two additional one-year renewal
options bringing the total to an amount not -to -exceed Four Hundred Thousand Dollars
($400,000). City shall pay Consultant on a time and materials basis up to the not -to -exceed
amount in accordance with Exhibit `B" titled "Fee Schedule" which is attached hereto and
incorporated herein by reference.
5.2 Consultant shall submit monthly invoices to City describing the Services performed during
the preceding month. Consultant's invoices shall include a brief description of the Services
performed, the dates the Sery ices were performed, the number of hours spent and by whom,
and a description of reimbursable expenses related to the Services. City shall pay
Consultant no later than thirty (30) days after receipt and approval by City of Consultant's
invoice.
5.3 Any notice or other communication required, or which may be given, pursuant to this
Agreement, shall be in writing. Any such notice shall be deemed delivered (i) on the date
of delivery in person; (ii) five (5) days after deposit in first class registered mail, with return
receipt requested; (iii) on the actual delivery date if deposited with an overnight courier; or
(iv) on the date sent by facsimile or electronic mail transmission (including PDF), if
confirmed with a copy sent contemporaneously by first class, certified, registered or
express mail; in each case properly posted and fully prepaid to the appropriate address set
forth below, or such other address as a Party may provide notice in accordance with this
section:
City:
City Clerk
City of Redlands
35 Cajon Street
P.O. Box 3005 (mailing)
Redlands, CA 92373
jdonaldson@cityofredlands.org
Phone: (909) 798-7531
CONSULTANT:
John E. Chaquica
George Hills Company, Inc
PO Box 278
Rancho Cordova, CA 95741
john.chaquica@georgehills.com
Phone: (916) 859-4824
Fax: (714) 596-7798
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ARTICLE 6 — INSURANCE AND INDEMNIFICATION
6.1 The following insurance coverage required by this Agreement shall be maintained by
Consultant for the duration of its performance of the Services. Consultant shall not perform
any Services unless and until the required insurance listed below is obtained by Consultant.
Consultant shall provide City with certificates of insurance and endorsements evidencing
such insurance prior to commencement of the Services. Insurance policies shall include a
provision prohibiting cancellation or modification of the policy except upon thirty (30)
days prior written notice to City.
A. Workers' Compensation and Employer's Liability insurance in the amount that meets
statutory requirements with an insurance carrier acceptable to City, or certification to
City that Consultant is self -insured or exempt from the workers' compensation laws of
the State of California. Consultant shall execute and provide City with Exhibit "C,"
titled "Workers' Compensation Insurance Certification," which is attached hereto and
incorporated herein by this reference, prior to performance of the Services.
B. Comprehensive General Liability insurance with carriers acceptable to City in the
minimum amount of One Million Dollars ($1,000,000) per occurrence and Two Million
Dollars ($2,000,000) aggregate, for public liability, property damage and personal
injury is required. City shall be named as an additional insured and such insurance shall
be primary and non-contributing to any insurance or self-insurance maintained by City.
C. Business Auto Liability coverage, with minimum limits of One Million Dollars
($1,000,000) per occurrence, combined single limit bodily injury liability and property
damage liability. This coverage shall include all Consultant owned vehicles used in
connection with Consultant's provision of the Services, hired and non -owned vehicles,
and employee non -ownership vehicles. City shall be named as an additional insured
and such insurance shall be primary and non-contributing to any insurance or self-
insurance maintained by City.
D. Consultant is expressly prohibited from assigning or subcontracting any of the Services
without the prior written consent of City. In the event of mutual agreement by the
Parties to assign or subcontract a portion of the Services, Consultant shall add such
assignee or subcontractor as an additional insured to the insurance policies required
hereby and provide City with the insurance endorsements prior to any Services being
performed by the assignee or subcontractor.
6.2 Consultant shall defend, indemnify and hold harmless City and its elected officials,
employees and agents from and against any and all claims, losses or liability, including
attorneys' fees, arising from injury or death to persons or damage to property occasioned
by any negligent act or omission by, or the willful misconduct of, Consultant, or its officers,
employees and agents in performing the Services.
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ARTICLE 7 — CONFLICTS OF INTEREST
7.1 Consultant covenants and represents that it does not have any investment or interest in any
real property that may be the subject of this Agreement or any other source of income,
interest in real property or investment that would be affected in any manner or degree by
the performance of Consultant's Services. Consultant further covenants and represents that
in the performance of its duties hereunder, no person having any such interest shall perform
any Services under this Agreement.
7.2 Consultant agrees it is not a designated employee within the meaning of the Political
Reform Act because Consultant:
A. Does not make a governmental decision whether to:
(i) approve a rate, rule or regulation, or adopt or enforce a City law;
(ii) issue, deny, suspend or revoke any City permit, license, application,
certification, approval, order or similar authorization or entitlement;
(iii) authorize City to enter into, modify or renew a contract;
(iv) grant City approval to a contract that requires City approval and to which
City is a party, or to the specifications for such a contract;
(v) grant City approval to a plan, design, report, study or similar item;
(vi) adopt, or grant City approval of, policies, standards or guidelines for City
or for any subdivision thereof.
B. Does not serve in a staff capacity with City and in that capacity, participate in
making a governmental decision or otherwise perform the same or substantially the
same duties for City that would otherwise be performed by an individual holding a
position specified in City's Conflict of Interest Code under Government Code
section 87302.
7.3 In the event City determines that Consultant must disclose its financial interests, Consultant
shall complete and file a Fair Political Practices Commission Form 700, Statement of
Economic Interests, with the City Clerk's office pursuant to the written instructions
provided by the City Clerk.
ARTICLE 8 — GENERAL CONSIDERATIONS
8.1 In the event any action is commenced to enforce or interpret any of the terms or conditions
of this Agreement the prevailing Party shall, in addition to any costs and other relief, be
entitled to the recovery of its reasonable attorneys' fees, including fees for the use of in-
house counsel by a Party.
8.2 Consultant shall not assign any of the Services, except with the prior written approval of
City and in strict compliance with the terms and conditions of this Agreement. Any
assignment or attempted assignment without such prior written consent may, in the sole
discretion of City, result in City's immediate termination of this Agreement.
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8.3 Consultant is for all purposes under this Agreement an independent contractor and shall
perform the Services as an independent contractor. Neither City nor any its agents shall
have control over the conduct of Consultant or Consultant's employees, except as herein
set forth. Consultant shall supply all necessary tools and instrumentalities required to
perform the Services. Assigned personnel employed by Consultant are for its account only,
and in no event shall Consultant or personnel retained by it be deemed to have been
employed by City or engaged by City for the account of, or on behalf of City. Consultant
shall have no authority, express or implied, to act on behalf of City in any capacity
whatsoever as an agent, nor shall Consultant have any authority, express or implied, to bind
City to any obligation.
8.4 This Agreement may be terminated by City, in its sole discretion, by providing not less
than five (5) days prior written notice to Consultant of City's intent to terminate. If this
Agreement is terminated by City, an adjustment to Consultant's compensation shall be
made, but (1) no amount shall be allowed for anticipated profit or unperformed Services,
and (2) any payment due Consultant at the time of termination may be adjusted to the extent
of any additional costs to City occasioned by any default by Consultant. Upon receipt of a
termination notice, Consultant shall immediately discontinue its provision of the Services
and, within five (5) days of the date of the termination notice, deliver or otherwise make
available to City, copies (in both hard copy and electronic form, where applicable) of
project related data, design calculations, drawings, specifications, reports, estimates,
summaries and such other information and materials as may have been accumulated by
Consultant in performing the Services. Consultant shall be compensated on a pro-rata basis
for Services completed up to the date of termination.
8.5 Consultant shall maintain books, ledgers, invoices, accounts and other records and
documents evidencing costs and expenses related to the Services for a period of three (3)
years, or for any longer period required by law, from the date of final payment to Consultant
pursuant to this Agreement. Such boobs shall be available at reasonable times for
examination by City at the office of Consultant.
8.6 This Agreement, including the Exhibits incorporated herein by reference, represents the
entire agreement and understanding between the Parties as to the matters contained herein,
and any prior negotiations, written proposals or verbal agreements relating to such matters
are superseded by this Agreement. Except as otherwise provided for herein, any
amendment to this Agreement shall be in writing, approved by City and signed by City and
Consultant.
8.7 This Agreement shall be governed by and construed in accordance with the laws of the
State of California.
8.8 If one or more of the sentences, clauses, paragraphs or sections contained in this Agreement
is declared invalid, void or unenforceable by a court of competent jurisdiction, the same
shall be deemed severable from the remainder of this Agreement and shall not affect,
impair or invalidate the remaining sentences, clauses, paragraphs or sections contained
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herein, unless to do so would deprive a Party of a material benefit of its bargain under this
Agreement.
IN WITNESS WHEREOF, duly authorized representatives of City and Consultant have
signed in confirmation of this Agreement.
City OF NDS
By:
Paul T. Barich, Mayor
ATTEST:
e Donaldson, City Clerk
GEORGE HILLS COMPANY, INC.
By:
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John . Chaquica, Chief Executive
Officer
EXHIBIT "A"
SCOPE OF SERVICES
SCOPE OF SERVICES AND CLIENT EXPRESSED AUTHORITY
AND LIMITATIONS UNDER THE CONTRACT
This Exhibit A is intended to provide the scope of services and specific service expectations in this
Agreement, that would not otherwise require revision during the contract period, and which may differ
from or elaborate upon our Client Service Profile. Services to be provided by George Hills Company
("GH") on behalf of City of Redlands ("City") may include all or some of the following,
I. SERVICES INCLUDED IN THE CONTRACT
A. General Administrative Services
Throughout each year GH performs numerous functions which support claims administration on behalf
of the City, but do not include any claims handling, and are performed by non -claims personnel.
Additionally, in the first year of a new client there are several "on -boarding" services that are general and
administrative in nature. Below is a list of such services which are included within the terms of this
Contract:
1) Access to CMIS and training.
2) A monthly listing of open claims, showing expense categories, reserves, and total incurred.
3) Monthly claim summary reports.
4) Providing loss run data and required reports.
5) Providing annual reports to outside agencies.
6) Filing of regulatory reports (such as 1099, W-9, etc.).
7) Establish and maintain a trust fund to pay indemnity and expenses that may be due on
claims. The amount to be maintained in the trust fund shall be determined by City.
8) If the trust fund is not set-up with the GH preferred bank California Bank & Trust, there
may be an additional set-up fee (other banks processes can be extraordinarily time
consuming).
9) New bank account set up (signature cards, test checks, online access, set up bank in CXP).
10) Discussion and agreement on the Approval process.
11) Process checks weekly.
12) Submit positive pay if applicable/monitor positive pay (review daily emails from bank for
exceptions).
13) Maintain a copy of all checks drawn by GFI to pay claims and claims related expenses.
14) Submit monthly check registers of all transactions made for the period.
15) Monitor account balance, prepare replenishment requests as needed (customize request for
each client's need).
16) Monthly bank reconciliation (prepared and sent to City).
17) Special reports that requested to go with billing invoices (by member, claim type, etc.).
18)Payment of invoices that are pass-throughs (i.e., invoices for medical record copies,
ExamWorks, etc.).
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19) Certificates of insurance as required by the Contract.
B. Investigative Services
1) Receipt and examination of all reports of accidents or incidents that are or may be the
subject of claims.
2) Investigate accidents or incidents as warranted, to include on -site investigation,
photographs, witness interviews, determination of losses and other such investigative
services necessary to determine all City losses but not to include extraordinary
investigative services outside the expertise of GH.
3) In the event City or other agency conducts any investigation, and upon Client's request,
GH shall review and analyze for liability and/or damage issues and for possible additional
follow-up investigation.
4) Maintain service on a 24-hour, 7 days per week basis, to receive reports of any incident or
accident which may be the subject of a liability claim and provide immediate investigative
services to the extent necessary to provide a complete investigation.
5) Undertake items of investigation requiring special handling for CITY at the direction of
the CITY' s Attorney or authorized representative.
C. Liability and Claim Handling Services
1) Promptly set up a claim file upon receipt of the claim and maintain a claim file on each
potential or actual claim reported.
2) Assess and evaluate the nature and extent of each claim and establish claims reserves for
indemnity and legal expense.
3) GH will follow any City policy regarding tort claim rejection instructions, including
rejection and return of an untimely or insufficient claim.
4) Ensure timely tort claim handling, including contact and follow-up with claimants
regarding claim issues and processing.
5) Any bodily injury claim that is being pursued shall be indexed. Notice only hatters or
precautionary bodily injury claims that are not pursued do not need to be indexed.
6) Determine the need for defense representation, recommend legal counsel, and support
litigation activity.
7) Report claims to the excess insurer in compliance with excess carrier's reporting
requirements and coordinate with the excess insurer on a claim's progress in accordance
with the excess insurer's reporting requirements.
8) Maintain records on any such claim and notify City when City is about to exhaust the Self -
Insured Retention.
9) Obtain settlement contracts and releases upon settlement of claims or potential claims not
in litigation.
10)Perform periodic reviews, as needed, of City files and claims as well as statutory
requirements to ensure compliance including excess insurance related requirements.
11) Perform the necessary data gathering for the Medicare, Medicaid, and SCHIP Extension
Act of 2007 (MMSEA) and the Set Aside Contracts in compliance with Section 11 1 of the
MMSEA including the required reporting. (See Attachment B)
12) To the extent there is privileged information or PHI shared between agencies, which is
subject to protection under HIPAA, GH shall implement all necessary measures in
compliance with the Act and will execute a Business Associates Agreement (BAA).
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D. Litigation Support Services
1) Upon notification by the City that litigation has been filed on an open claim, GH shall
follow the litigation referral process as outlined in the Client Expressed Scope of Work
Instructions form.
2) Work cooperatively with City in choosing outside counsel from approved panel, if any,
and assist defense counsel in on -going litigation defense efforts.
3) Obtain and maintain a Litigation Plan and Budget.
4) Review legal bills for compliance with Litigation Plan and Budget; Review, evaluate and
adjust defense counsel invoices for legal services.
5) Cooperate with and assist defense counsel assigned to litigation of open claims and provide
such investigative services as directed during pre-trial and trial stages.
6) Assist in responding to discovery or preparing discovery.
7) At the request of the City, attend mandatory settlement conferences on behalf of City.
8) At the request of the City, appear on behalf of City in small claims actions filed against
City on open claims handled by GH.
9) Review and evaluate case evaluations, correspondence and status reports forwarded to
GH by counsel. Regularly discuss, review, and direct investigation, discovery, and case
strategy with counsel.
10) Cooperate with counsel as a team with an open communication approach on each case to
obtain the most economical and best result for the City.
E. Reports and Procedures
1) Within thirty (30) days of assignment, or sooner if practicable, required, or requested, GH
will provide City with a report pursuant to specified claims handling instructions, showing
name(s) of claimant(s), type of claim, date of loss, comments on liability, reserve
recommendations, settlement recommendations, and other pertinent information.
Subsequent to the initial thirty (30) day report, GH will report as often as warranted by any
important change in status but no longer than every ninety (90) days until the claim closes
unless extended diary is appropriate.
2) All original reports, documents, and claim data of every kind or description, that are
prepared in whole or in part by or for the GH in connection with this contract shall be City's
property and constitute the GH's work product for which compensation is paid. A copy of
all reports, documents, and claim data of every kind or description that is in whole or in
part by or for the City is the property of GH. Additional copies of original reports,
documents, and data requested by City will be at City's expense in accordance with this
contract.
3) GH agrees that City have access and the right to audit and reproduce any of the GH's
relevant records to ensure that the City is receiving all services to which the City is entitled
under this Contract or for any purpose relating to the Contract.
F. Data
1) Utilize GH's claims management system—CXP (ClaimsXpress), or a substantially similar
equivalent with comparable features and functionality. City will be provided "read-only"
access to the claims system. "Read-write" access may be obtained at the City's additional
expense.
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2) Record all claim information including all financial data.
3) Provide City and broker Read only on-line access to the claims data system (up to five
users), if desired by City.
4) Provide monthly standard loss run and check register.
5) Provide annual claims data report upon request. Written authorization and/or a Business
Associate Agreement may be required for confidential information protected by HIPAA.
6) Provide assistance to City in developing customized reports when requested (may require
additional charge).
7) Arrange for electronic file conversion for any open and closed claims at the direction of
City.
G. Claim Review Meetings
GH shall, on a mutually agreed periodic basis, meet with City to review and discuss the City's
claims inventory and claims results of specified periods and delivery of services by CLAIM
ADMINISTRATOR.
H. Financial Accounting
1) Establish and maintain a trust fund for the purpose of paying indemnity and expenses that
may be due on the claims. The amount to be maintained in the trust fund shall be
determined by the City.
2) Maintain a copy of all checks drawn by the GH to pay claims and claims related expenses.
3) Submit monthly check registers of all transactions made for the period.
4) Complete or update Attachment B "Preferred Method of Check Processing" for check
processing options.
5) Approval process shall be documented in GH Client Expressed Scope of Work Standards
and Instruction Form.
6) GH will provide monthly bank reconciliation reports to City for audit purposes.
I. Third Party Subrogation Services
1) GH personnel are well versed in the identification, handling, and pursuit of subrogation
claims arising out of CLAIMS which are the subject of this Contract. Included within this
contract, GH will perform the following functions:
2) Identify potential opportunities to recover from persons, businesses, and entities other than
the City.
3) Prepare and file a claim with each identified entity.
4) As applicable, tender defense to or seek recovery from any identified entity.
5) With the assistance of counsel, prepare and file any necessary litigation required to effect
the claim of recovery on behalf of the City
6) Manage litigation related to such claims made to other person, businesses or entities
J. First Party Subrogation Services
GH is a claim administration firm experienced in the handling of first party subrogation claims
and is ready and capable of performing such services on behalf of City. GH does not handle
subrogation claims with a value of less than $1000. For any claim in excess of $1,000, City may
retain GH for Subrogation Services. Our services are unique to a first party loss of the City caused
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by the intentional or negligent act of a third party. Such losses generally are for the recovery of
damages, and may include:
1) Labor costs, fully loaded and including benefit costs, for district or other personnel
responding to or in any manner providing services;
2) Services or materials provided by outside vendors or contractors;
3) Internal or external vehicle or equipment use and/or rental;
4) Materials and/or goods utilized for the repair/replacement of damaged property; and/or
5) Additional fees that may be specific to the individual entity that are provided for within
district ordinances or other governing documents.
II. CLIENT EXPRESSED AUTHORITY AND LIMITATIONS
The list immediately below contains numerous services provided in this Contract for which GH
requests the City expressly establish authority and/or limitations, on the ability of GH to act on
behalf of the City. The City will check the appropriate box establishing the authority of GH to act
or the limitation as to that authority.
INVESTIGATION:
n George Hills will conduct all investigations
n City will conduct all investigations
• City will direct GH on each claim as to who performs investigations
In the event the Client or other agency conducts any investigation, GH shall review for
completeness.
Retention of Vendors (appraisers, translators, copy services, Independent Adjuster, IME's,
Surveillance, etc.):
® Must be preauthorized by City
❑ Does not need preauthorization
REJECTION OF CLAIMS:
City's position regarding rejections (e.g., if entity so dictates, a claim will be rejected for
insufficiency). Check all that apply.
Protocols for Rejections
• GH needs authorization
❑ GH does not need authorization
Z GH sends the Rejection
n City sends the Rejection
n GH sends out Denial Letter simultaneously with Rejection outlining the reason
LITIGATION:
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Check all that apply.
❑ GH will handle litigated claims
❑ Full
❑ As assigned
❑ Check Issuance and Data Input
❑ Data Input only
® City will handle litigated claims in-house, with GH to capture data into SIMS
n City will send data to GH weekly
n City will send data to GH monthly
Mandatory Settlement Conferences
❑ GH always attends
® At City request only
Small Claims Actions filed against City
❑ GH always appears
® At City request only
Legal Counsel
M GH must have City authorization to refer to outside Legal Counsel
n GH does not need City authorization to refer to outside Legal Counsel
n GH must use City approved Legal Panel for Attorney selection
® City does not have an approved Legal Panel for Attorney selection
n All Litigation to be handled by City in-house Legal
n GH always sends Litigation Assignment packets to Legal Counsel
City specific Litigation Guidelines:
City specific Litigation Referral Form/Letter:
City specific Litigation Budget Form:
n Yes ❑ No
❑ Yes ❑ No
n Yes ❑ No
Pay fees for Experts, photocopies, medical records as: ® Expense n Legal
EXCESS REPORTING:
• GII will report claims to the excess insurer in compliance with excess carrier's reporting
requirements and coordinate with the excess insurer on a claim's progress in accordance with the
excess insurer's reporting requirements.
n City will report claims to the excess insurer in compliance with excess carrier's reporting
requirements and coordinate with the excess insurer on a claim's progress in accordance with
the excess insurer's reporting requirements.
AUTHORITY LEVELS:
Reserve within SIR:
❑ $0.00 Other: $
(specify amount)
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Adjuster must seek approval from (client contact) to post indemnity reserves above authority level.
Medical Treatment:
❑ Medical Authorizations should only be sent to the claimant once liability is determined to be
adverse to the City.
❑ Medical Authorizations should go out as soon as it is determined that a BI claim is being
pursued.
CLAIMS EXCEEDING SIR:
❑ GH stops tracking activity once the SIR has been reached.
I GH will continue to track all activity at and/or above the SIR. The Excess JPA/Carrier will
provide GH with activity documentation above the SIR.
❑ GH will reserve to Full Value and track recoveries.
THIRD PARTY SUBROGATION SERVICES:
❑ GH is authorized to initiate third party subrogation claims on behalf of City
0 GH must obtain authorization to initiate third party subrogation claims on behalf of City.
FIRST PARTY SUBROGATION SERVICES:
❑ City elects to incorporate the first party subrogation services of GH into the contract
0 City authorizes GH to initiate first party subrogation claims on behalf of City
❑ City agrees to the additional compensation payable to GH for its first party subrogation services
as follows:
GH shall be entitled to % of the gross recovery for each claim initiated by GH
through its first party subrogation efforts.
0 City agrees to the terms and conditions stated in Attachment B, Subrogation Services.
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EXHIBIT "B"
FEE SCHEDULE
The following compensation, fees and expenses, shall be paid in consideration for the services
provided by Consultant as described in this Agreement to Perform Professional Services under
Article 5 — Payments to Consultant, which has been agreed to, including claims activity. This
section shall remain in force and services provided during the term of this Contract, unless
otherwise amended by the parties.
The amounts to be paid pursuant to this Agreement are detailed in two distinct areas of services:
First, under subsection 1) below, "Fees for Claims Administration Services"; and
Second, under subsection 2) below, "Reimbursable Costs and Expenses" which specifically relate
to provision of claims handling services which is the subject of this Contract.
The fees and expenses/costs will be billed together monthly in our standard invoice format.
Additionally, if the City elects any optional services identified in this section, such as First Party
Subrogation Services or any of the identified Optional Services, such agreed upon additional
amounts will also be billed together monthly where applicable.
1) Fees for Claims Administration Services
Client agrees to pay a fixed fee of $69,000 per year for the first year of its engagement
with GH, in exchange for the claim administration and handling services described in
this Agreement and the Exhibits hereto.
The fixed fee is a base fee and subject to re-evaluation in the event that the claim
volume increases or decreased by more than 10%. The City agrees that the base number
of claims is 70.
2) Reimbursable Costs and Expenses
a. Annual Administration Fee: City agrees to pay an annual administration
fee of $10,000 which is billed annually at the beginning of the Agreement
period and thereafter upon the anniversary of the Agreement.
b. Mileage — Adjuster: Mileage is paid at the IRS rate.
c. MMSEA: There is a $500 annual reporting fee which is paid directly to
ExamWorks, for the performance of CMS reporting.
d. Adjuster Travel Expenses: GH will separately charge for any travel
expenses in connection with attendance at mediations, settlement
conferences, trials, etc. This will be subject to prior approval and that actual
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expenses with no mark-ups will be submitted with receipts on a monthly
basis.
e. System Access Fee: Access to the claims management information system,
"CMIS", carries a cost of $1,500 annually. That cost is included in the
annual administration fee and includes the setup and management of up to
five (5) "read only" user accounts. "Read/write" access to the system can
be obtained for an additional fee.
f. iMetrics Report Fee: There will be no charge for our iMetrics business
intelligence reports with executive in -person debriefs.
g. Custom Reports: Additional charges for custom reporting shall be defined
as, requiring a third -party programmer for three hours or more and is client
specific.
h. Catastrophic Fees: GH recognizes that there are events that are
unanticipated and catastrophic. When such events occur, it requires
additional hours for the handling of such claims. As such, to preserve the
quality and efficiency of service for which we are known, GH proposes that
should any one catastrophic event occur resulting in five or more claimants,
or two or more claimants with their own defense counsel, City shall be
billed at the current hourly rate for all services. Catastrophic Fees under this
section only apply to City's which have selected a "Fixed Fee" or "Time
and Expense with a cap" payment options.
i. 3% Annual Escalator: All GFI pricing options under this Contract are
subject to an automatic annual increase of 3%. This annual increase shall
take effect upon each anniversary of the Contract effectiveness date..
J•
General File: A general administrative file shall be established and
maintained to track effort related to services necessary to fulfill our
contractual obligations and not otherwise associated with a claim.
k. Paper Files: GH is prepared to take the lead to arrange for all services
relating to conversion storage, copying, scanning, shipping, and disposal.
GH will provide you a quote for any services related to storage, retrieval,
copying, scanning, shipping, and disposal of paper files.
3) First Party Subrogation Services And Fees
GH is a claim administration firm experienced in the handling of first party
subrogation claims and is ready and capable of performing such services on behalf
of City. GH does not handle subrogation claims with a value of less than $1000.
For any claim in excess of $1,000, and with prior written consent from City, GH
shall initiate its Subrogation Services as described more fully in Attachment A,
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Scope of Services and Client Expressed Authority and Limitations as well as
Attachment A-l, Subrogation Agreement. Our services are unique to a first party
loss of the City caused by the intentional or negligent act of a third party. City will
pay a Subrogation Fee in the amount of 30% for each and every recovery obtained.
4) Optional Services
a. Legal Services and Consultation (Optional and upon written request):
GH employs in-house General Counsel which have vast experience in claims
and litigation handling for all claims which are, or could be, subject to this
agreement. GH offers the services of its attorneys as an additional resource for
GH clients, on a time and expense basis, as follows:
i. Litigation Management: $175.00 per hour
These services include the oversight of all assigned GH claims
adjusters and monitoring and handling of "watch list" claims (highest
exposure, most complex litigation). These services are also available
on a claim by claim basis in support of the Lead Adjuster assigned due
to the complexity of the claims.
ii. Monitoring Counsel: $175.00 per hour
This case specific service includes evaluating coverage issues,
monitoring claim and litigation strategy, analyzing liability and damage
issues, participating in discussions regarding resolution by trial or
settlement, and controlling costs.
iii. Outside General and Special Counsel: $175.00 per hour
These services include confidential analysis and problem solving for
managing risk and avoiding unnecessary litigation and provides
immediate access to legal advice This includes identifying coverage
issues, providing input and assistance on Public Records Act Requests,
tort claim handling and strategy, conflicts of interest, oversight of
outside litigation counsel and providing legal opinions on potential and
active litigation.
iv. Trial/Mediation/Board Meetings Attendance: $175.00 per hour
These services include attending Board Meetings, trial, mediation, and
other court hearing attendance including appearing before Courts of
Appeal. Analysis and consultation provided before, during and after
these significant litigation events can reduce exposure and maximize
opportunities for resolution.
v. Legal Training and Seminars: $175.00 per hour
These services include providing customized seminars and training
upon request. Subject areas include memorandums of coverage, all
aspects of risk management, claims handling and litigation, employment
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law and general liability claims. Courses are customized to address the
client's specific needs.
vi. Professional and Financial Services: $175.00 per hour
As related to risk management and loss prevention in alignment with the
scope of services.
NOTE: These services are traditionally Time and Expense, however an annual fee
can be considered.
I. PAYMENT SCHEDULE
GH will submit its invoices to City, and payment of undisputed amounts shall be made by
City, within a reasonable period of time, not to exceed thirty (30) days from the date of the
invoice.
II. ELECTRONIC FUNDS TRANSFER OR DIRECT DEPOSIT
GH has determined that the most efficient and secure default form of payment for goods
and/or services provided under Contract with City shall be Electronic Funds Transfer
(EFT) or direct deposit, unless an alternative method of payment is deemed appropriate by
both GH and City and agreed to in writing.
GH will submit a direct deposit authorization request via to City with banking and vendor
information, and any other information that the City determines is reasonably necessary to
process the payment and comply with all accounting, record keeping, and tax reporting
requirements.
At any time during the duration of the Contract, GII may submit a written request for an
exemption to this requirement. Such request must be based on specific legal, business or
operational needs and GH will explain why the payment method designated by the City is
not feasible and an alternative is necessary.
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EXHIBIT "C"
WORKERS' COMPENSATION INSURANCE CERTIFICATION
Every employer, except the State, shall secure the payment of compensation in one or more of the
following ways:
(a) By being insured against liability to pay compensation by one or more insurers duly
authorized to write compensation insurance in this State.
(b) By securing from the Director of Industrial Relations, a certificate of consent to
self -insure, either as an individual employer, or as one employer in a group of
employers, which may be given upon furnishing proof satisfactory to the Director
of Industrial Relations of ability to self -insure and to pay any compensation that
may become due to his or her employees.
CHECK ONE
X I am aware of the provisions of Section 3700 of the Labor Code which requires every
employer to be insured against liability for Workers' Compensation or to undertake self-insurance
in accordance with the provisions of that Code, and I will comply with such provisions before
commencing the performance of the work and activities required or permitted under this
Agreement. (Labor Code §1861).
I affirm that at all times, in performing the work and activities required or permitted under
this Agreement, I shall not employ any person in any manner such that I become subject to the
workers' compensation laws of California. However, at any time, if I employ any person such that
I become subject to the workers' compensation laws of California, immediately I shall provide the
City with a certificate of consent to self -insure, or a certification of workers' compensation
insurance.
I certify under penalty of perjury under the laws of the State of California that the information and
representations made in this certificate are true and correct.
GEORGE HILLS CO. INC.
By:?"'
(�JohnChaquica,yCEO
Date:
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7/5/22