HomeMy WebLinkAboutContracts & Agreements_91-2024AGREEMENT TO PERFORM PROFESSIONAL SERVICES
This agreement for the provision of Workers' Compensation Claims Services
("Agreement") is made and entered in this 21st day of May, 2024 ("Effective Date"), by and
between the City of Redlands, a municipal corporation ("City") and AdminSure, 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 third party claims administration services for
City's Self -Insured Workers' Compensation Program (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 this
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 Robert Meteau, Department 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 "Scope of Services," 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 from the Effective Date
of this Agreement (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 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 compensation for Consultant's performance of the Services shall not exceed the
amount of Three Hundred Eighty -Two Thousand Three Hundred Twenty Dollars
($382,320) for the Services provided during the Initial Term. Should this Agreement be
extended, the compensation for Consultant's performance for the Services shall not exceed
the amount of One Hundred Thirty -Eight Thousand One Hundred Ninety -Two Dollars
($138,192) for the first Extended Term; and One Hundred Forty -Two Thousand Three
Hundred Forty -Four Dollars ($142,344) for the second Extended Term, bringing the total
possible amount of compensation to a not -to -exceed amount of Six Hundred Sixty -Two
Thousand Eight Hundred Fifty -Six Dollars ($662,856). For the Initial Term and each
Extended Term, City shall pay Consultant on a time and materials basis up to the not to
not -to -exceed amount in accordance with the rates specified in Exhibit "B," titled "Fee
Schedule," which is attached hereto and incorporated herein by this 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 Services 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:
Alithia Vargas -Flores, President
AdminSure, Inc.
3380 Shelby Street
Ontario, CA 91764
avargas -flores@ adminsure. com
909-396-5814
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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.
1. 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.
2. 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.
3. Consultant shall secure and maintain professional liability insurance throughout the
term of this Agreement in the amount of One Million Dollars ($1,000,000) per claim
made.
4. 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.
5. 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 and appointed
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 of 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 books 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, without regard to its conflicts of laws provisions. The Parties agree that
all actions or proceedings arising in connection with this Agreement shall be tried and
litigated only in the state courts located in San Bernardino County, California, and the
federal courts located in Riverside County, 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 A eement.
CITY 0
By:
ddie Tejeda, Mayor
ATTEST:
e onaldson, City Clerk
CONSULTANT
By:
Alithia Vargas-F, `ores, President
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EXHIBIT "A"
SCOPE OF SERVICES
CLAIMS ADMINISTRATION
The Administrator shall have the authority and responsibility to provide claims administration
services which include:
1. Within 24 hours, establishing a claim file upon receipt of an Employer's Report of
Occupational Injury or Illness (Form 5020) and/or a Workers' Compensation Claim Form
(DWC 1).
2. Set and update reserves requirements.
3. Coordinate investigations.
4. Determine compensability of claims.
5. Once a claim file is opened and/or there is knowledge of a possible imminent claim,
Consultant shall make immediate (within one workday) 3-point contact with the City, the
injured worker, and the treating medical facility, document all communication in
Consultant's software program.
6. Prepare and issue benefit notices and pamphlets.
7. Initiate and maintain contact with employees and applicant attorneys as required.
8. Send proper notices to the injured worker notifying them of the decision reference their
claim (acceptance, delay, or denial), and their rights under the Workers' Compensation
Laws of California.
9. Arrange medical treatment from medical practitioners and specialists.
10. Monitor disability status by reviewing medical reports and contacting medical practitioners
for updates.
11. Audit and pay medical bills.
12. Pay mileage reimbursement to employees.
13. Arrange medical examinations in conformance with State law to determine status of
employees' medical condition up to and including permanent and stationary and permanent
disability.
14. Pay total temporary disability and permanent disability compensation in accordance with
the law.
15. With City authorization, arrange representation for the City, whenever the need arises, with
attorneys approved by Human Resources.
16. Monitor attorneys and assist in preparing cases.
17. Audit and pay legal expenses.
18. Arrange for vocational rehabilitation services when appropriate.
19. Monitor voucher system.
20. Audit and pay voucher system expenses.
21. Attend all hearings that are required by law.
22. Prepare and issue permanent disability compensation notices.
23. With City authorization, pursue subrogation when there is a viable third party.
24. Timely notification to Human Resources assigned staff and the City's excess insurance
carriers of all claims which exceed or may exceed the City's self-insurance retention,
maintaining timely communication between the City and its excess insurance carriers on
matters affecting the handling of such claims and arranging for reimbursement to the City
for losses in excess of its self-insurance limits.
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25. Obtain Index Claim Searches (ISO/EDEX) on all lost time claims and when appropriate.
26. With City authorization, report suspected fraud cases to the Insurance Crime Prevention
Institute and the California Department of Insurance, Bureau of Fraudulent Claims.
27. Close claim files when appropriate to do so and notify the City of such closure.
CHECKING ACCOUNT
1. The City shall establish a checking account from which all Workers' Compensation
benefits and expenses are paid.
2. The Consultant shall prepare checks and issue those checks directly to payees without
delay.
3. The Consultant shall sign checks with a facsimile check signing machine.
4. The Administrator shall ensure the security of checks, check signer and personnel
utilizing items and performing payable tasks.
5. The City shall maintain an adequate balance in the checking account to meet all
Workers' Compensation obligations without delay.
6. The Consultant shall be responsible for ordering the checks and notifying the City prior
to doing so.
7. The checking account may be used to pay civil penalties imposed on the City in which
case the Administrator shall reimburse the City within fifteen (15) days for any amount
of the penalty which the Administrator caused.
STATISTICAL REPORTS
The Consultant shall provide and deliver to the City within (15) days of the close of each
calendar month, statistical reports which shall include at a minimum:
1. A monthly loss experience report, by department and work class, containing:
a) the employee's name;
b) injury date;
c) closing date;
d) cause of injury;
e) description of injury;
f) days lost from work;
g) claims number;
h) status (i.e. litigated);
i) benefits paid -to -date;
j) expenses paid -to -date;
k) future liability;
1) subrogation recovery, and
m) total incurred.
2. Allocation Report — A list of costs paid during current month and year-to-date segregated
by department and work class.
3. Summary Report — A summary for each year depicting:
a) open cases;
b) closed cases;
c) total days lost;
d) total benefits and expenses paid to date;
e) future liability, and
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f) total incurred.
4. Check Register — A list of all transactions paid during the month showing:
a) check number;
b) transaction date;
c) amount;
d) payee;
e) name of employee, and
f) claim number.
5. Transaction Register — A list of all transactions paid during the month by type of payment
(i.e. defense attorney expense, etc.)
6. Litigation Register — A list of open claims by. defense firm listing:
a) employee name;
b) date of injury;
c) description of injury, and
d) litigation expenses paid -to -date.
7. Claims Opened During the Month — An alphabetical listing by employee name depicting
all claims information to date of closure.
8. Claims Closed During the Month — An alphabetical listing by employee name depicting
all claims information to date of closure.
9. Provide specialized/custom statistical reports within twenty (20) calendar days after
request by Human Resources Director at no, or reasonable, additional cost to City.
10. Required reports will be reviewed with the TPA at the beginning of each contract year
to determine need.
11. All reports are to be confidentially submitted electronically to the Human Resources
staff assigned by the Human Resources Director unless otherwise requested.
OTHER EXPENSES
Non -staff expenses such as legal costs and fees, investigations and rehabilitation vendor fees, the
cost of employing experts for professional advice, opinion or testimony, and similar costs normally
considered as Allocated Loss Expenses are not included in the compensation to Consultant as
hereinafter set forth. Such expenses are chargeable as part of the claims cost, as is the custom
under insured plans when computing losses for experience rating, retrospective rating, or dividend
computation, and are paid by the City of Redlands.
Consultant shall provide at least the following legal support services on each claim wherein the
claimant has commenced litigation. Upon notification by the City that an Application for
Adjudication has been filed, Consultant shall attempt to settle the claim directly with the
employee's attorney without litigation. If litigation becomes imminent, an attorney specializing
in the defense of Workers' Compensation claims shall be retained to represent the City of
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Redlands. Upon request of the City of Redlands, Consultant shall provide all the information and
files concerning said attorney.
RECORDS
Establish and maintain claim files, log transaction documents and all other records associated with
the Workers' Compensation Program. These records shall be the property of the City and shall be
available both electronically and hard copy, upon five (5) days' notice, for review or transfer to
another custodian. Unless this Agreement is cancelled, closed files shall be stored by the
Administrator for five (5) years and shall thereafter become the responsibility of the City. These
records shall not be disposed of or destroyed without the prior, express written authorization of the
City.
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EXHIBIT "B"
Fee Schedule
Claims Administration Services
(Includes Internal Support Staff)
Flat Fee
Bill Review Services
Flat Fee
Utilization Review Services
Flat Fee
Transition Fee
Data Conversion Fee
CM /MNLSEA — Internal Services
City On -Line Access (All Data)
All Reports & Custom/Ad Hoc
Index Claim Search & 1099s
Training & Development of Special
Account Instructions/Procedures &
Banking
All Meetings, Quarterly Claim
Reviews, Forms, Posters &
Pamphlets
Fee/Cost Proposal
• Year 1: $10,140 per month.
• Year 2: $10,647 per month.
• Year 3: $11,073 per month.
• Year 4: $11,516 per month.
• 1ear 5: $11,862 per month.
• Full Services: $12.50 flat fee per bill for all Official Medical Fee
Schedule (OMFS), In -Patient Hospital Fee Schedule (IIHFSS), and
Out -Patient, et cetera, reviews; and when applicable, plus .75
cents for State of California required E-BIIUOCR Services; or
$10 flat fee per bill for partial bill review services_
• Within Full Services: when applicable, up to 27% Preferred
Prvvider Organisation (PPO)/Negotiated Savings fee, if there
are no applicable savings, there are no fees_
• Within Full Services: no additional. fees for transmitting medical
billing information on behalf of the City to the TTbrkers'
Compensation Information System (WcIS) as required by State
Law, i_ e., Medical Bill Review EDI (Elechnnic Data Interchange)
Reporting and Services.
• 3% annual increase.
• Non -physician review/decision — fiat fee up to 7.75% qf tom
charges (T75 cap per bill); $85 adjuster/$125 idilization review.
• Physician (includes peer and expert) review/decision —flat fee at
the rate of$300 per hour_
• 3% annual increase.
• 'lofts —N/A.
• No fee —NIA.
• No additional fee_
• City Users: no fee for read-only; at -cost fee forread and write_
• No fee. At -cost when data is not captured
• No additional fee.
• No fee. Reference any `Banking" fees, please make note that any
fees charged by the City's choice of bank shall be at cost as we
will not add on any fee for our internal services_
• No aiditional fee.
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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.
ADMINSURE, INC.
Date: 5/8/24
Alithia Vargas-Fes, President
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