HomeMy Public PortalAbout094-2017 - UMR-Health Insurance - employee benefitsADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement ("Agreement") between UMR, Inc. ("UMR" in this Agreement) and City
of Richmond, Indiana ("Customer" in this Agreement) is effective January 1, 2017 ("Effective Date"). This
Agreement covers the services UMR is providing to Customer, either directly or in conjunction with one of UMR's
affiliates, for use with Customer's Self -Funded employee benefit plan and apply to claims for Plan benefits that are
incurred on or after the Effective Date.
UMR, Inc. identifies this arrangement as Contract No.: 76-412661. Customer identifies this arrangement as
Contract No. 94-2017.
By signing below, each party agrees to the terms of this Agreement.
City of Richmond, Indiana,
By and Through its Board of Public Works
And Safety
50 North 5th Street
Richmond, IN 47374
r �
By:
Vicki Robinson, President
By:
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RiAo,mberBy
Anthony L. Foster, II, Me r
Approved.
David M. Snow, Mayor
Date: 6
UMR, Inc.
400 E. Business Way, Suite 100
Cincinnati, OH 45�41
By: A
Authorized Si
Print Name: /Uc k'�Clf
Print Title: �;Ilz 16U4 L a-706r41-10141— 1dL;(eZ
Date:
ASA 2Q 2016
Contract No. 94-2017
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Table of Contents
Section1 — Definitions.................................................................................................................................... I
Section 2A — Customer Responsibilities.........................................................................................................2
Section 2B — Statement and Subject of Work.................................................................................................3
Section3 — Fees.......................................................................................................................................3
Section 4 — Records, Information, Audits.......................................................................................................4
Section 5 -- Taxes And Assessments...............................................................................................................5
Section6 — Indemnification............................................................................................................................6
Section 7 — Plan Benefits Litigation................................................................................................................6
Section8 — Termination..................................................................................................................................7
Section9 — Miscellaneous...............................................................................................................................7
EXHIBIT A — STATEMENT OF WORK....................................................................................................10
EXHIBIT B — SERVICE FEES....................................................................................................................21
EXHIBIT B — SERVICE FEES (2018 RENEWAL)....................................................................................26
EXHIBIT C — BUSINESS ASSOCIATE AGREEMENT............................................................................31
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Section 1 — Definitions
When these terms are capitalized in the Agreement they have the meanings set forth below. The words may be
singular or plural.
Bank Account: Bank Account maintained for the payment of Plan benefits, expenses, fees and other Customer
financial obligations.
Employee: A current or former employee of Customer or its affiliated employer.
IRC: The United States Internal Revenue Code of 1986, as amended from time to time.
IRS: The United States Internal Revenue Service.
Network: The group of Network Providers UMR makes available to the Plan who have entered into or are governed
by contractual arrangements under which they agree to provide health care services to Participants and accept
negotiated fees for these services.
Network Pharmacy: A retail pharmacy, mail order pharmacy, specialty pharmacy or other facility that is duly
licensed to operate as a pharmacy at its location and to dispense prescription drugs to Participants, and has entered
into a Network Pharmacy agreement. An affiliate of UMR, in its capacity as a mail order pharmacy or specialty
Pharmacy, is a Network Pharmacy of the Customer.
Network Provider: The physician, or medical professional or facility which participates in a Network. A provider
is only a Network Provider if they are participating in a Network at the time services are rendered to the Plan
Participant.
Overpayments: Payments that exceed the amount payable under the Plan. This term does not include
overpayments caused by untimely or inaccurate eligibility information.
Participant: Employee or dependent who is covered by the Plan.
PHI: Any information UMR receives or provides on behalf of the Plan which is considered Protected Health
Information as the term is defined in the privacy regulations of the Health Insurance Portability and Accountability
Act of 1996.
Plan: The plan to which this Agreement applies, but only with respect to those provisions of the plan relating to the
Self -Funded health benefits UMR is administering, as described in the Summary Plan Description.
Plan Administrator: The current or succeeding person, committee, partnership, or other entity designated the Plan
Administrator who is generally responsible for the Plan's operation.
Proprietary Business Information: Nonpublic information, trade secrets, and other data including, but not limited
to, sales and marketing information, management systems, strategic plans and other information about the disclosing
party's business, industry, products and services, plans, specifications, operation methods, pricing, costs, techniques,
manuals, know-how and other intellectual property, in written, oral, electronic or other tangible form, provided by
one party to another or its representative; and all information, documents, technology, products, and services
containing or derived from Proprietary Business Information which was or may have been transmitted, given or
made available to or viewed by one party or another in the course of the receiving party's relationship. UMR's
Proprietary Business Information shall include, but not be limited to, discounts and other financial provisions related
to UMR's contracted healthcare providers and claims data from which those financial provisions can be derived and
financial provisions related to prescription drug products covered under the medical benefit, the Prescription Drug
List, reimbursement rates, compensation arrangements, and all other financial provisions related to the pharmacy
benefits contained in this Agreement. While the Prescription Drug List is considered UMR's Proprietary Business
Information, it may be disclosed in the limited circumstances outlined in this Agreement. This information is
collectively known as "UMR's Financial PBI".
Rebate: Any discount, price concession or other direct or indirect remuneration UMR receives from a drug
manufacturer under a rebate agreement that is contingent upon and related directly to Participant use of a
prescription drug under the Plan's pharmacy benefit or the medical benefit during the Term. Rebate does not include
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any, discount, price concession, administration fees or other direct or indirect remuneration UMR receives from a
drug manufacturer for direct purchase of a prescription drug.
Self -Fund or Self -Funded: Means that Customer, on behalf of the Plan, has the sole responsibility to pay, and
provide funds, to pay for all Plan benefits. UMR has no liability or responsibility to provide these funds. This is true
even if UMR or its affiliates provides stop loss insurance to Customer.
Summary Plan Description or SPD: The document(s) Customer provides to Plan Participants describing the terms
and conditions of coverage offered under the Plan.
Systems: Means the systems UMR owns or makes available to Customer to facilitate the transfer of information in
connection with this Agreement.
Tax or Taxes: A charge imposed, assessed or levied by any federal, state, local or other governmental entity.
Term or Term of the Agreement: The period of twelve (12) months commencing on the Effective Date and
automatically continuing for additional 12-month periods until the Agreement is terminated.
Following the Effective Date and after Customer has provided three (3) months' worth of funds for the processing of
claims and/or the payment of administrative fees, this Agreement is deemed executed by the parties.
Urgent Care Claims: A claim for medical services and supplies which meets ERISA's definition of Urgent Care
Claim.
Section 2A — Customer Responsibilities
Section 2A.1 Responsibility for the Plan. UMR is not the Plan Administrator of the Plan. Any references in this
Agreement to UMR "administering the Plan" are descriptive only and do not confer upon UMR anything beyond
certain agreed upon claim administration duties. Except to the extent this Agreement specifically requires UMR to
have the fiduciary responsibility for a Plan administrative function, Customer accepts total responsibility for the
Plan for purposes of this Agreement including its benefit design, the legal sufficiency and distribution of SPDs, and
compliance with any laws that apply to Customer or the Plan, whether or not Customer or someone Customer
designates is the Plan Administrator. The Customer represents and warrants that the Plan has the authority to pay
fees due under this Agreement from Plan assets.
Section 2A.2 Plan Consistent with the Agreement. Customer represents that Plan documents, including the
Summary Plan Description as described in Exhibit A — Statement of Work, are consistent with this Agreement.
Nevertheless, before distributing any communications describing Plan benefits or provisions to Participants or third
parties, Customer will provide UMR with such communications which refer to UMR or UMR's services prior to
distributing these materials to Employees or third parties. Customer will amend them if UMR reasonably determines
that references to UMR are not accurate, or any Plan provision is not consistent with this Agreement or the services
that UMR is providing.
Section 2A.3 Plan Changes. Customer must provide UMR with notice of any changes to the Plan and/or Summary
Plan Description within a reasonable period of time prior to the effective date of the change to allow UMR to
determine if such change will alter the services UMR provides under this Agreement. Any change in the services to
be provided by UMR under this Agreement which would be caused by any aforementioned changes must be
mutually agreed to in writing prior to implementation of such change. UMR will notify Customer if (i) the change
increases UMR's cost of providing services under this Agreement or (ii) UMR is reasonably unable to implement or
administer the change. If the parties cannot agree to a new fee within (30) thirty days of the notice of the new fee or
if UMR notifies Customer that UMR is unable to reasonably implement or administer the change, UMR shall have
no obligation to implement or administer the change, and Customer may terminate this Agreement upon (60) sixty
days written notice.
Section 2A.4 Affiliated Employers. Customer represents that together Customer and any of its affiliates covered
under the Plan make up a single "controlled group" as defined by the IRC. Customer agrees to provide UMR with a
list of Customer's affiliates covered under the Plan upon request.
Section 2A.5 Information Customer Provides to UMR. Customer will tell UMR which of Customer's
Employees, their dependents and/or other persons are Participants. This information must be accurate and provided
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to UMR in a timely manner. UMR will accept eligibility data from Customer in the format described in Exhibit A —
Statement of Work. Customer will notify UMR of any change to this information as soon as reasonably possible.
UMR will be entitled to rely on the most current information in UMR's possession regarding eligibility of
Participants in paying Plan benefits and providing other services under this Agreement. UMR will not be required to
process or reprocess claims, but if UMR agrees to do so, additional fees may apply.
UMR shall be entitled to rely upon any written or oral communication from Customer, its designated employees,
agents or authorized representatives.
Section 2A.6 Notices to Participants. Customer will give Participants the information and documents they need to
obtain benefits under the Plan within a reasonable period of time before coverage begins. In the event this
Agreement is discontinued, Customer will notify all Participants that the services UMR is providing under this
Agreement are discontinued.
Section 2A.7 Escheat. Customer is solely responsible for complying with all applicable abandoned property or
escheat laws, making any required payments, and filing any required reports.
Section 2B — Statement and Subject of Work
Customer hereby retains UMR to provide an employee welfare benefit plan for the City of Richmond Human
Resources Department.
The administrative services UMR has agreed to provide is attached hereto as Exhibit "A", which Exhibit consists
Pages 10-20, and is hereby incorporated by reference and made a part of this Agreement. UMR shall perform all
work and provide all services described on Exhibit "A."
Should any provisions, terms, or conditions contained in any of the documents attached hereto as Exhibits, or
in any of the documents incorporated by reference herein, conflict with any of the provisions, terms, or
conditions ofthis Agreement, this Agreement shall be controlling.
In providing all services set forth in this Agreement, UMR shall use the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent claims administrator/fiduciary acting in a like capacity and
familiar with such matters would use under similar circumstances.
UMR shall furnish all labor, material, equipment, and services necessary for the proper completion of all wait
specified. No performance of services shall commence until the following has been met:
The Customer is in receipt of any required certificates of insurance; the Customer is in receipt of any required
affidavit signed by UMR in accordance with Indiana Code 22-5-1.7-11(a)(2).
Section 3 — Fees
Section 3.1 Fees. Customer will pay fees to UMR as compensation for the services provided by UMR. In addition to
the fees specified in Exhibit B, Customer must also pay UMR any additional fee that is authorized by a provision
elsewhere in this Agreement or is otherwise agreed to by the parties.
Section 3.2 Changes in Fees. UMR can change the fees on each Term anniversary ("Renewal Term"). UMR will
provide Customer with thirty (30) days prior written notice of the revised fees for subsequent Renewal Terms. Any
such fee change will become effective on the later of the first day of the new Renewal Term or thirty (30) days after
UMR provides Customer with written notice of the new fees. UMR will provide Customer with a new Exhibit B that
will replace the existing Exhibit B for the new Renewal Term.
UMR also can change the fees (i) any time there are changes made to this Agreement or the Plan, which affect the
fees, (ii) when there are changes in laws or regulations which affect or are related to the services UMR is providing,
or will be required to provide, under this Agreement, including the Taxes and fees noted in Section 5 Taxes And
Assessments (iii) if the number of Employees covered by the Plan or any Plan option changes by fifteen percent
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(15%) or more or (iv) if the average contract size, defined as the total number of enrolled Participants divided by the
total number of enrolled Employees, varies by 15% or more from the assumed average contract size set forth in
Exhibit B. Any new fee required by such change will be effective as of the date the changes occur, even if that date
is retroactive.
If Customer does not agree to any change in fees, Customer may terminate this Agreement upon thirty (30) days
written notice after Customer receives written notice of the new fees. Customer must still pay any amounts due for
the periods during which the Agreement is in effect.
Section 3.3 Due Dates, Payments, and Penalties. Customer agrees to pay fees to UMR based on the monthly
invoice UMR provides. UMR reserves the right to provide Customer with an estimated invoice for the first month
of services. The Due Date for payment of the invoiced amounts is on the last day of the month for such billing
period. Such invoices are provided on an eligibility -based format, and therefore payment must be made as billed (no
adjustments are allowed to the invoice). Adjustments to monthly billing statements for retroactive enrollment or
eligibility changes will be performed based on information provided by Customer. Requests for fee adjustment must
be made in a timely manner but no more than three (3) months following the date of the change.
Late Payment. If amounts owed are not paid as required when due, Customer will be provided with a notice of
default and fifteen (15) days to cure. If Customer does not cure, UMR may terminate this Agreement as provided
for in this Agreement. If any portion of the fee is disputed, Customer shall pay UMR the undisputed portion as
provided herein, and shall provide written details to UMR prior to the date payment is due, explaining Customer's
good faith basis for disputing such fee. Customer may withhold the disputed portion during pendency of such
dispute, during which time both parties agree to use commercially reasonable efforts to resolve the dispute.
Section 4 — Records, Information, Audits
Section 4.1 Records. UMR will keep records relating to the services it provides under this Agreement for as long as
UMR is required to do so by law.
Section 4.2 Proprietary Business Information. Each party will limit the use of the other's Proprietary Business
Information to only the information required to administer the Plan, to perform under this Agreement, or as
otherwise permitted under this Agreement. Neither party will disclose the other's Proprietary Business Information
to any person or entity other than to the disclosing party's employees, subcontractors, or authorized agents needing
access to such information to administer the Plan, to perform under this Agreement, or as otherwise permitted under
this Agreement, except that UMR's Financial PBI cannot be disclosed by Customer to any third party without
UMR's express written consent. This provision shall survive the termination of this Agreement.
Section 4.3 Access to Information. Other than as provided for in Section 4.4, if Customer needs UMR's
Proprietary Business Information in order to administer the Plan, UMR will allow Customer to use UMR's
Proprietary Business Information, if it is legally permissible, the information relates to UMR's services under this
Agreement, and Customer gives UMR reasonable advance notice and an explanation of the need for such
information. Such use is subject to the terms of this Agreement.
If Customer is subject to an Indiana Access to Public Records Act (APRA) request and the request includes UMR's
Proprietary Business Information, Customer will contact UMR prior to releasing any information and give UMR the
opportunity to review, respond and/or object to the APRA request.
UMR will provide information only while this Agreement is in effect and for a period of six (6) months after the
Agreement terminates, unless Customer demonstrates that the information is required by law or for Plan
administration purposes.
UMR also will provide reasonable access to information to an entity providing Plan administrative services to
Customer, such as a consultant or vendor, if Customer requests it. Before UMR provides PHI to that entity, the
parties must sign a mutually agreed -upon confidentiality agreement, and the parties must agree as to what
information is minimally necessary to accomplish the Plan administrative service.
Section 4.4 Audits. During the term of the Agreement, and at any time within six (6) months following its
termination, a mutually agreeable entity may audit UMR once each calendar year to determine whether UMR is
fulfilling the terms of this Agreement. Prior to the commencement of this audit, UMR must receive a signed,
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mutually agreeable confidentiality agreement, which agreement shall not be unreasonably withheld by UMR or
Customer.
Without limiting the foregoing, with respect to audits regarding the payment of Rebates by pharmaceutical
manufacturers, the audit must be conducted solely by a "big four" public accounting firm that maintains a separate
and stand-alone audit department and is not providing support in conjunction with any litigation pending against
UMR or its affiliates. However, if no "big four" public accounting firm is qualified to perform the audit due to the
above requirements, another mutually agreeable firm meeting such requirements may be used.
Customer must advise UMR in writing of its intent to audit. The place, time, type, duration, and frequency of all
audits must be reasonable and agreed to by UMR. All audits will be limited to information relating to the previous
eighteen (18) months. With respect to UMR's transaction processing services, the audit scope and methodology will
be consistent with generally acceptable auditing standards, including a statistically valid random sample or other
acceptable audit technique as approved by UMR ("Scope").
Customer will pay any expenses that it incurs in connection with the audit. In addition, Customer will be charged a
reasonable per claim charge and a $1,000 charge per day for audits outside of the following parameters: (1) more
than one audit per calendar year; (2) any on -site audit visit that is not completed within five (5) business days; (3)
sample sizes exceeding the Scope specified above; or (4) any audit initiated after this Agreement has terminated.
The additional fees cover the additional resources, facility fees, and other incremental costs associated with an audit
that exceeds the Scope.
In addition to Customer's expenses and any applicable fees, Customer will also pay any extraordinary expenses
UMR incurs in connection with the audit. For any audit initiated after this Agreement is terminated, Customer will
pay all expenses incurred by UMR.
Customer will provide UMR with a copy of any audit reports within thirty (30) days after Customer receives the
audit report(s) from the auditor.
Section 4.5 Service Auditor Reports. UMR may make its Type 11 service auditor report ("Report") available to
UMR's self -funded customers each year for Customer's review in connection with Plan administrative purposes
only. The Report will be issued under the guidance of Statement on Standards for Attestation Engagements #16
(SSAE16). Should new guidelines covering service auditor reports be issued, UMR may make the equivalent of, or
any successor to, the SSAE16 Type II Report available to UMR's self -funded customers. The Report is UMR's
Proprietary Business Information and shall not be shared with any third parties without UMR's prior written
approval; provided, however, that Customer can share the Report with: (i) Customer's independent public
accounting firm; and/or (ii) Customer's consultants, provided that such consultants are not in any way a competitor
of UMR's and that Customer informs its consultants that the report was not prepared for their use. To the extent that
Customer does provide the Report to its independent public accounting firm or a consultant as permitted herein,
Customer shall require that they retain the Report as confidential and that they not disclose such Report to any other
persons or entities.
Section 4.6 PHI. The parties' obligations with respect to the use and disclosure of PHI are outlined in the Business
Associate Addendum attached to this Agreement.
Section 5 — Taxes And Assessments
Section 5.1 Payment of Taxes and Expenses. In the event that any Taxes are assessed against UMR as a claim
administrator in connection with UMR's services under this Agreement, including all topics identified in Section 5.3
Customer will reimburse UMR through the Bank Account for Customer's proportionate share of such Taxes (but not
Taxes on UMR's net income). UMR has the authority and discretion to reasonably determine whether any such Tax
should be paid or disputed. Customer will also reimburse UMR for a proportionate share of any cost or expense
reasonably incurred by UMR in disputing such Tax, including costs and reasonable attorneys' fees and any interest,
fines, or penalties relating to such Tax, unless caused by UMR's unreasonable delay or unreasonable determination
to dispute such Tax.
Section 5.2 Tax Reporting. In the event that the reimbursement of any benefits to Participants in connection with
this Agreement is subject to Plan or employer based tax reporting requirements, Customer agrees to comply with
these requirements.
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Section 5.3 State and Federal Surcharges, Fees and Assessments. The Plan is responsible for state or Federal
surcharges, assessments, or similar Taxes imposed by governmental entities or agencies on the Plan or UMR,
including, but not limited to, those imposed pursuant to The Patient Protection and Affordable Care Act of 2010
("PPACA"), as amended from time to time. This includes the funding, remittance and determination of the amount
due for PPACA required taxes and fees.
Section 6 — Indemnification
Section 6.1 Customer Indemnifies UMR. Customer will indemnify UMR and hold UMR harmless against any and
all losses, liabilities, penalties, fines, costs, damages, and expenses, UMR incurs, including reasonable attorneys'
fees, which arise out of (i) Customer or its vendors', subcontractors' or authorized agents' gross negligence or
willful misconduct in the performance of Customer or its vendors', subcontractors' or authorized agents' obligations
under this Agreement or any other agreements entered into with such third parties on Customer's behalf (ii)
Customer's material breach of this Agreement (iii) a breach of any other agreements UMR enters into with such
third parties on Customer's behalf, all as determined by a court or other tribunal having jurisdiction of the matter
(iv) third party claims brought against UMR as the claims administrator (e.g. a claim raised by the federal
government based on the federal Medicare Secondary Payor laws). This provision shall survive the termination of
this Agreement.
Section 6.2 UMR Indemnifies Customer. UMR will indemnify Customer and hold Customer harmless against any
and all losses, liabilities, penalties, fines, costs, damages, and expenses, that Customer incurs, including reasonable
attorneys' fees, which arise out of (i) UMR or its vendors', subcontractors' or authorized agents' gross negligence or
willful misconduct in the performance of UMR or its vendors', subcontractors' or authorized agents' obligations
under this Agreement or (ii) UMR's material breach of this Agreement, all as determined by a court or other tribunal
having jurisdiction of the matter. Notwithstanding the foregoing, Customer will remain responsible for payment of
benefits and UMR's indemnification will not extend to indemnification of Customer or the Plan against any claims,
liabilities, damages, judgments or expenses that constitute payment of Plan benefits. This provision shall survive the
termination of this Agreement.
Section 7 — Plan Benefits Litigation
Section 7.1 Litigation Against UMR. If a demand is asserted, or litigation or administrative proceedings are begun
by a Participant or healthcare provider against UMR to recover Plan benefits related to its duties under this
Agreement ("Plan Benefits Litigation"), UMR will select and retain defense counsel to represent its interest.
Section 7.2 Litigation Against Customer. If Plan Benefits Litigation is begun against Customer and/or the Plan,
Customer will select and retain counsel to represent its interest.
Section 7.3 Litigation Against UMR and Customer. If Plan Benefits Litigation is begun against the Plan and
UMR jointly, and provided no conflict of interest arises between the parties, the parties may agree to joint defense
counsel. If the parties do not agree to joint defense counsel, then each party will select and retain separate defense
counsel to represent their own interests.
Section 7.4 Litigation Fees and Costs. All reasonable legal fees and costs UMR incurs will be paid by Customer
(except as provided in Section 6.2) if UMR gives Customer reasonable advance notice of UMR's intent to charge
Customer for such fees and costs, and UMR consults with Customer in a manner consistent with UMR's fiduciary
obligations on UMR's litigation strategy.
Section 7.5 Litigation Cooperation. Both parties will cooperate fully with each other in the defense of Plan
Benefits Litigation.
Section 7.6 Payment of Plan Benefits. In all events, Customer is responsible for the full amount of any Plan
benefits paid as a result of Plan Benefits Litigation.
Section 7.7 Survival. This provision shall survive the termination of this Agreement.
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Section 8 — Termination
Section 9.1 Services End. UMR's services under this Agreement stop on the date this Agreement terminates,
regardless of the date that claims are incurred. However, UMR may agree to continue providing certain services
beyond the termination date, as provided in Exhibit A — Statement of Work.
Section 9.2 Termination Events. This Agreement will terminate under any of the following circumstances: (i) The
Plan terminates, (ii) Both parties agree in writing to terminate the Agreement, (iii) After the initial Term, either party
gives the other party at least sixty (60) days prior written notice, (iv) UMR gives Customer notice of termination
because Customer did not pay the fees or other amounts Customer owed UMR when due under the terms of this
Agreement, (v) UMR gives Customer notice of termination if Customer fails to provide the required funds for
payment of benefits under the terms of this Agreement, (vi) Either party is in material breach of this Agreement,
other than by non-payment or late payment of fees owed by Customer or the funding of Plan benefits, and does not
correct the breach within thirty (30) days after being notified in writing by the other party, (vii) UMR may terminate
this Agreement in the event of a filing by or against the Customer of a petition for relief under the Federal
Bankruptcy Code, (viii) Any state or other jurisdiction prohibits a party from administering the Plan under the terms
of this Agreement, or imposes a penalty on the Plan or UMR and such penalty is based on the administrative
services specified in this Agreement. In this situation, the party may immediately discontinue the Agreement's
application in such state or jurisdiction. Notice must be given to the other party when reasonably practical. The
Agreement will continue to apply in all other states or jurisdictions, or (ix) As otherwise specified in this
Agreement.
Section 9 — Miscellaneous
Section 10.1 Subcontractors. UMR can use its affiliates or subcontractors to perform UMR's services under this
Agreement. UMR will be responsible for those services to the same extent that UMR would have been had it
performed those services without the use of an affiliate or subcontractor.
Section 10.2 Assignment. Except as provided in this paragraph, neither party can assign this Agreement or any
rights or obligations under this Agreement to anyone without the other party's written consent. That consent will not
be unreasonably withheld. Nevertheless, UMR can assign this Agreement, including all of its rights and obligations
to UMR's affiliates, to an entity controlling, controlled by, or under common control with UMR, or a purchaser of
all or substantially all of UMR's assets, subject to notice to Customer of the assignment.
Section 10.3 Governing Law. This Agreement is governed by the applicable laws of the State of Indiana. This
provision shall survive the termination of this Agreement.
Section 10.4 Entire Agreement. This Agreement, with its exhibits, constitutes the entire agreement between the
parties governing the subject matter of this Agreement. This Agreement replaces any prior written or oral
communications or agreements between the parties relating to the subject matter of this Agreement. The headings
and titles within this Agreement are for convenience only and are not part of the Agreement. This Agreement shall
be binding upon UMR and Customer as parties and each of their successors and assigs. Any person executing this
Agreement in a representative capacity hereby warrants that he/she has been duly authorized by his or her principal
to execute this Agreement.
Section 10.5 Amendment. Except as may otherwise be specified in this Agreement, the Agreement may be
amended only by both parties agreeing to the amendment in writing, executed by a duly authorized person of each
party.
Section 10.6 Waiver/Estoppel. Nothing in this Agreement is considered to be waived by any party, unless the party
claiming the waiver receives the waiver in writing. No breach of the Agreement is considered to be waived unless
the non -breaching party waives it in writing. A waiver of one provision does not constitute a waiver of any other. A
failure of either party to enforce at any time any of the provisions of this Agreement, or to exercise any option which
is herein provided in this Agreement, will in no way be construed to be a waiver of such provision of this
Agreement.
Section 10.7 Notices. Any notices, demands, or other communications required under this Agreement will be in
writing and may be provided via electronic means or by United States Postal Service by certified or registered mail,
return receipt requested, postage prepaid, or delivered by a service that provides written receipt of delivery.
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Section 10.8 Use of Name. The parties agree not to use each other's name, logo, service marks, trademarks or other
identifying information without the written permission of the other; provided, however, Customer grants UMR
permission to use Customer's name, logo, service marks, trademarks or other identifying information to the extent
necessary for UMR to carry out its obligations under this Agreement (e.g. on SPDs and ID cards).
Section 10.9 Compliance with Laws and Regulations. The parties agree to comply with all applicable federal,
state and other laws and regulations with respect to this Agreement.
Section 10.10 No Third Party Beneficiaries. Nothing in this Agreement shall confer upon any person other than
the parties and their respective successors or assigns, any rights, remedies, obligations, or liabilities whatsoever.
Section 10.11 Severability. The invalidity or unenforceability of any provision of this Agreement will not affect
the validity or enforceability of any other provision. However, it is intended that a court of competent jurisdiction
construe any invalid or unenforceable provision of this Agreement by limiting or reducing it so as to be valid or
enforceable to the extent compatible with applicable law.
Section 10.12 Independent Contractor. UMR shall be deemed to be an independent contractor and is not an
employee or agent of the Customer. UMR shall select appropriately trained and skilled personnel to perform the
services and will monitor their performance and as reasonably necessary, replace personnel who do not possess the
requisite qualifications to perform the tasks assigned to them.
Section 10.13 Compliance with Worker's Compensation Law. UMR shall comply with all provisions of the
Indiana Worker's Compensation Law, and shall, before commencing work under this Agreement, provide the
Customer a certificate of insurance, or a certificate from the industrial board showing that UMR has complied with
Indiana Code Sections 22-3-2-5, 22-3-5-1 and 22-3-5-2. If UMR is an out of state employer and therefore subject to
another state's worker's compensation law, UMR may choose to comply with all provisions of its home state's
worker's compensation law and provide the Customer proof of such compliance in lieu of complying with the
provisions of the Indiana Worker's Compensation Law.
Section 10.13 Compliance with Indiana E-Verify Program Requirements. Pursuant to Indiana Code 22-5-1.7,
UMR is required to enroll in and verify the work eligibility status of all newly hired employees of UMR through the
Indiana E-Verify program. UMR is not required to verify the work eligibility status of all newly hired employees of
UMR through the Indiana E-Verify program if the Indiana E-Verify program no longer exists. Prior to the
performance of this Agreement, UMR shall provide to the Customer its signed Affidavit affirming that UMR does
not knowingly employ an unauthorized alien in accordance with IC 22-5-1.7-11 (a) (2). In the event UMR violates
IC 22-5-1.7 UMR shall be required to remedy the violation not later than thirty (30) days after the Customer notifies
UMR of the violation. If UMR fails to remedy the violation within the thirty (30) day period provided above, the
Customer shall consider UMR to be in breach of this Agreement and this Agreement will be terminated. If the
Customer determines that terminating this Agreement would be detrimental to the public interest or public property,
the Customer may allow this Agreement to remain in effect until the Customer procures a new contractor. If this
Agreement is terminated under this section, then pursuant to IC 22-5-1.7-13 (c) UMR will remain liable to the
Customer for actual damages.
Section 10.14 Iran Investment Activities. Pursuant to Indiana Code (IC) 5-22-16.5, UMR certifies that UMR is
not engaged in investment activities in Iran. In the event Customer determines during the course of this Agreement
that this certification is no longer valid, Customer shall notify UMR in writing of said determination and shall give
UMR ninety (90) days within which to respond to the written notice. In the event UMR fails to demonstrate to the
Customer that UMR has ceased investment activities in Iran within ninety (90) days after the written notice is given
to UMR, the Customer may proceed with any remedies it may have pursuant to IC 5-22-16.5. In the event the
Customer determines during the course of this Agreement that this certification is no longer valid and said
determination is not refuted by UMR in the manner set forth in IC 5-22-16.5, the Customer reserves the right to
consider UMR to be in breach of this Agreement and terminate the agreement upon the expiration of the ninety (90)
day period set forth above.
Section 10.15 Prohibition Against Discrimination.
A. Pursuant to Indiana Code 22-9-1-10, UMR, any sub -contractor, or any person acting on behalf
of UMR or any sub -contractor shall not discriminate against any employee or applicant for
Proprietary Information of UnitedHealth Group
employment to be employed in the performance of this Agreement, with respect to hire, tenure, terms,
conditions or privileges of employment or any matter directly or indirectly related to employment,
because of race, religion, color, sex, disability, national origin, or ancestry.
B. Pursuant to Indiana Code 5-16-6-1, the UMR agrees:
1. That in the hiring of employees for the performance of work under this Agreement of any
subcontract hereunder, UMR, any subcontractor, or any person acting on behalf of UMR or
any sub -contractor, shall not discriminate by reason of race, religion, color, sex, national
origin or ancestry against any citizen of the State of Indiana who is qualified and available to
perform the work to which the employment relates;
2. That UMR, any sub -contractor, or any person action on behalf of UMR or any sub -contractor
shall in no manner discriminate against or intimidate any employee hired for the performance
of work under this Agreement on account of race, religion, color, sex, national origin or
ancestry;
3. That there may be deducted from the amount payable to UMR by the Customer under this
Agreement, a penalty of five dollars ($5.00) for each person for each calendar day during
which such person was discriminated against or intimidated in violation of the provisions of the
Agreement; and
4. That this Agreement may be canceled or terminated by the Customer and all money due or to
become due hereunder may be forfeited, for a second or any subsequent violation of the terms
or conditions of this section ofthe Agreement.
C. Violation of the terms or conditions of this Agreement relating to discrimination or
intimidation shall be considered a material breach ofthis Agreement.
Section 10.13 Insurance.
Contractor agrees to obtain insurance as set forth below:
Coverage and Limits
A. Worker's Compensation & Disability Requirements Statutory
B. Employer's Liability $100,000
C. Malpractice/Errors & Omissions Insurance $1,000,000 each occurrence
$2,000,000 each aggregate
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Proprietary Information of UnitedHealth Group
EXHIBIT A - STATEMENT OF WORK
The following are the administrative services UMR has agreed to provide to Customer. Customer may request that
UMR provide services in addition to those set forth in this Agreement. If UMR agrees to provide them, those
services will be governed by the terms of this Agreement and any amendments to this Agreement. Customer will
pay an additional fee, determined by UMR, for these additional services. The services described in this Exhibit will
be made available to Customer's eligible Participants consistent with the Summary Plan Description under which
the Participant is covered.
Section Al Network
Network Access, Management and Administration. UMR will provide access to Networks and Network
Providers, as well as related administrative services including physician (and other health care professional)
relations, clinical profiling, contracting and credentialing, and network analysis and system development. The make-
up of the Network can change at any time. Notice will be given in advance or as soon as reasonably possible.
UMR generally does not employ Network Providers and they are not UMR's agents or partners, although certain
Network Providers are affiliated with UMR. Otherwise, Network Providers participate in Networks only as
independent contractors. Network Providers and the Participants are solely responsible for any health care services
rendered to Participants. UMR is not responsible for the medical outcomes or the quality or competence of any
provider or facility rendering services, including Network Pharmacies and services provided through UMR's
affiliates' networks, or the payment for services rendered by the provider or facility.
Value Based Contracting Program. UMR's contracts with some Network Providers may include withholds,
incentives, and/or additional payments that may be earned, conditioned on meeting standards relating to utilization,
quality of care, efficiency measures, compliance with UMR's other policies or initiatives, or other clinical
integration or practice transformation standards. Customer shall fund these payments due the Network Providers as
soon as UMR makes the determination the Network Provider is entitled to receive the payment under the Network
Provider's contract, either upfront or after the standard has been met. For upfront funding, if UMR makes the
determination that the Network Provider failed to meet a standard, UMR will return to Customer the applicable
amount. UMR shall provide Customer reports describing the amount of payments made on behalf of Customer's
Plan.
Only the initial claims based reimbursement to Network Providers will be subject to the Participant's copayment,
coinsurance or deductible requirements. Customer will pay the Network Provider the full amount earned or
attributable to its Participants, without a reduction for copayments or deductibles and agree that there will be no
impact from these payments on the calculation of the Participant's satisfaction of their annual deductible amount.
Section A2 Recovery Services
Claim Recoveries. In the event an Overpayment is made, UMR shall make an attempt to recover Overpayments
using its Overpayment recovery procedures. In the event the recovery attempts are unsuccessful, UMR will follow
its established overpayment recovery rules for an escalated recovery process. Recovery attempts will remain open
for a minimum of twelve months. UMR will be responsible for reimbursement of any unrecovered Overpayment to
the extent the Overpayment was due to UMR's gross negligence.
Subrogation. UMR will also provide services to recover Plan benefits that were paid and are recoverable by the
Plan because payment was or should have been made by a third party for the same medical expense (other than in
connection with coordination of benefits, Medicare, or other Overpayments). This is referred to as "Third Party
Liability Recovery" (or "subrogation"). Customer will not engage any entity except UMR to provide the services
described herein without UMR's prior approval.
Recovery Fees. Customer will be charged fees when any of the services described herein are provided by UMR
through a subcontractor or affiliate. The fees are deducted from the actual recoveries. Customer will be credited with
the net amount of the recovery
Recovery Process. Customer delegates to UMR the discretion and authority to develop and use standards and
procedures for any recovery, including but not limited to, whether or not to seek recovery, what steps to take if
UMR decides to seek recovery, and the circumstances under which a claim may be compromised or settled for less
10
Proprietary Information of UnitedHealth Group
than the full amount of the claim. Customer acknowledges that use of UMR's standards and procedures may not
result in full or partial recovery for any particular case. UMR will not pursue any recovery if it is not permitted by
any applicable law, or if recovery would be impractical. UMR may initiate litigation to recover payments, but UMR
has no obligation to do so. If UMR initiates litigation, Customer will cooperate with UMR in the litigation.
If this Agreement terminates, or, if UMR's recovery services terminate, UMR can continue to recover any payments
UMR is in the process of recovering. The appropriate fees will continue to be deducted from the actual recovery,
when and if a recovery is obtained.
In the event that Customer directs UMR to stop working on a particular subrogation Claim because the Customer
wants to handle the subrogation Claim itself, or because the Customer waives its subrogation interest, or for other
reasons, UMR retains the right to charge Customer a reasonable fee based on costs incurred prior to receiving such
notification from Customer.
Fraud and Abuse Management. UMR's Special Investigation Unit reviews and investigates potentially fraudulent
or inappropriate billings submitted by providers and Participants. Following investigation, the identified Claims are
either paid in accordance with the Plan, or are denied for such reasons as are uncovered by the Special Investigation
Unit. Fraud and Abuse Management processes will be based upon UMR's proprietary and confidential procedures,
modes of analysis and investigations.
UMR will use these procedures and standards in delivering Fraud and Abuse Management services to Customer and
UMR's other customers. These procedures and standards include, but are not limited to: whether or not to seek
recovery, what steps to take if UMR decides to seek recovery, and under what circumstances to compromise a claim
or settle for less than the full amount.
Customer delegates to UMR the discretion and authority to use such procedures and standards, including the
authority to undertake actions, including legal actions, which have the largest impact for the largest number of
customers. Customer acknowledges that the use of these procedures and standards may not result in full or partial
recovery or in full recovery for any particular case. UMR does not guarantee or warranty any particular level of
prevention, detection, or recovery. UMR agrees to perform Fraud and Abuse Management services pursuant to the
industry standards for such services. If this Agreement terminates, or if UMR's claim recovery services terminate,
UMR can elect to continue fraud and abuse recoveries that are in progress and the fees will continue to apply.
Section A3 Providing Funds for Benefits
Responsibility. The Plan is Self -Funded. Customer is solely responsible for providing funds for payment for all
Plan benefits payable to Participants, Network Providers, or non -Network Providers.
Control of Plan Assets. In the event that the Plan is found to have Plan assets, the Customer shall have absolute
authority with respect to such Plan assets, and UMR shall neither have nor be deemed to exercise any discretion,
control or authority with respect to the disposition of Plan assets.
Bank Account. UMR has agreed to establish a Bank Account on behalf of Customer, in Customer's name and tax
identification number. The Bank Account is set up in a manner so that banking fees are offset for Customer in lieu
of earning interest. UMR, shall be given the necessary nonexclusive authority to utilize funds in the Bank Account
for payment of Plan benefits, Plan expenses (such as state surcharges or assessments) and other agreed upon services
under the Agreement.
Services. UMR shall be responsible for the performance of Bank Account reconciliation. UMR agrees to send
search letters to payees of uncashed checks in accordance with UMR's established procedures. Uncashed checks
will be returned to the Plan as soon as reasonably possible after search efforts have ceased. In no event shall UMR
become a holder of unclaimed property, as defined in any applicable unclaimed property law.
Security Deposit. Customer agrees to a security deposit in an amount determined by UMR. UMR reserves the
right to require adjustments of the security deposit based on actual average disbursement activity. The security
deposit is to cover periodic fluctuations in claim activity and must remain in the account as long as UMR continues
to issue checks against the account. UMR agrees to return the balance of the security deposit to Customer as soon as
reasonably possible after the Bank Account is closed.
Payment Authorization. Authorization to release payments drawn on Customer's Bank Account will be provided
by UMR once Customer's funding obligations have been met. UMR offers various frequencies (check holds) for
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Proprietary Information of UnitedHealth Group
the printing and release of checks. The check hold on a Bank Account must have a month end clear. A month end
clear means any checks held in queue at the end of the month will be printed and released on the last working day of
the month. UMR will provide weekly reports regarding cash disbursements to Customer.
Timing. On behalf of Customer, UMR will initiate weekly reimbursement of Customer's Bank Account via ACH
debit.
Account Balance. In the event Customer's Bank Account balance falls below fifty percent (50%) of the security
deposit amount, UMR reserves the right to either initiate an ACH for disbursements not funded or UMR will contact
Customer and request Customer wire transfer needed funds to Bank Account. In the event the Bank Account
balance falls below twenty five percent (25%) of the security deposit, UMR reserves the right to suspend payment of
claims under Customer's Plan(s). Payment of such Claims will be restored when UMR has been reimbursed for all
outstanding disbursements and the security deposit has been restored. In the event the disbursement activity creates
a deficit in the account, UMR will immediately notify Customer. A same day wire deposit to Customer's Bank
Account must be made to fund all unpaid Claims and to restore the security deposit amount. Customer agrees to pay
overdraft charges, when applicable, related to the maintenance of the Bank Account. UMR will maintain the Bank
Account for a period of one hundred eighty (180) days after the last check is cut or one hundred eighty (180) days
after the date of the oldest outstanding check. Customer is responsible for paying UMR the monthly banking
maintenance fee as stated on the Fee Schedule for as long as the account remains open.
Section A4 Claims Determinations and Appeals
Claim Procedures. Customer appoints UMR a named fiduciary under the Plan with respect to (i) performing initial
benefit determinations and payment, (ii) performing the fair and impartial review of first level internal appeals and
(iii) performing the fair and impartial review of second level internal appeals (if applicable). As such, Customer
delegates to UMR the discretionary authority to (i) construe and interpret the terms of the Plan, (ii) to determine the
validity of charges submitted to UMR under the Plan, and (iii) make final, binding determinations concerning the
availability of Plan benefits under the Plan's internal appeal process, all in compliance with applicable law and
regulation. In the event that Customer has not finalized the Summary Plan Description (SPD) before UMR receives
an appeal from a Participant, then UMR will follow the claims installation documents that Customer approved, or if
needed, UMR will contact Customer for applicable information. Participants who receive an adverse benefit
determination can file an appeal with UMR within the timelines established in Customer's SPD. It is understood
that UMR will provide one or two appeal levels for claims that it has processed, as mutually agreed to in writing by
the parties. UMR agrees to send an appealed claim to an independent reviewer if required by Department of Labor
or Department of Health and Human Services. In addition, and if applicable to Customer's Plan, UMR agrees to
send a voluntary appeal to an independent review organization in compliance with health care reform regulations.
Customer understands that the cost of such mandated independent reviews will be the responsibility of Customer,
unless otherwise stated in the Fee Exhibit. It is understood that UMR is not responsible for handling appeals on
claim -related decisions that were originally made by another vendor of Customer's. Customer acknowledges and
agrees that certain services provided by UMR and as described in the Summary Plan Description will comply with
federal laws and regulations, as provided for under ERISA.
Catastrophic Events (Effective January 1, 2018). During such time as a government agency declares a state of
emergency or otherwise invokes emergency procedures with respect to Participants who may be affected by severe
weather or other catastrophic events (a "Catastrophic Event Timeframe"), Customer directs UMR to implement
certain changes in its claim procedures for affected Participants, including, for example: (a) exemption from the
application of prior authorization requirements and/or penalties; (b) waiver of out -of -network restrictions (e.g., out -
of -network providers paid at the Network Provider level); (c) extension of time frames for timely claims filing
and/or appeals; (d) early replacement of lost or damaged durable medical equipment; and (e) other protocols
reasonably required to provide Participants with access to health plan and pharmacy benefits, as applicable. Such
protocols are applicable to Participants whose place of residency falls within impacted areas of the Catastrophic
Event, and for dates of service that fall within the Catastrophic Event Timeframe.
Section A5 System Access
Access. UMR grants Customer the nonexclusive, nontransferable right to access and use the f inctionalities
contained within the Systems, under the terms specified in this Agreement. Customer agrees that all rights, title, and
12
Proprietary Information of UnitedHealth Group
interest in the Systems and all rights in patents, copyrights, trademarks, and trade secrets encompassed in the
Systems will remain UMR's. To obtain access to the Systems, Customer will obtain, and be responsible for
maintaining, at no expense to UMR, the hardware, software, and Internet browser requirements UMR provides to
Customer, including any amendments thereto. Customer will be responsible for obtaining an Internet Service
Provider or other access to the Internet. Customer will not (i) access Systems or use, copy, reproduce, modify, or
excerpt any Systems documentation provided by UMR in order to access or utilize Systems, for purposes other than
as expressly permitted under this Agreement or (ii) share, transfer or lease Customer's right to access and use
Systems, to any other person or entity which is not a party to this Agreement. Customer may designate any third
party, with prior approval from UMR, to access Systems on Customer's behalf, provided the third party agrees to
these terms and conditions of Systems access and Customer assumes joint responsibility for such access.
Security Procedures. Customer will use commercially reasonable physical and software -based measures to protect
the passwords and user IDs provided by UMR for access to and use of any web site provided in connection with the
services. Customer shall use commercially reasonable anti -virus software, intrusion detection and prevention
system, secure file transfer and connectivity protocols to protect any email and confidential communications
provided to UMR, and maintain appropriate logs and monitoring of system activity, Customer shall notify UMR
within a reasonable timeframe of any (a) unauthorized access or damage, including damage caused by computer
viruses resulting from direct access connection, and (b) misuse and/or unauthorized disclosure of passwords and
user IDs provided by UMR which impact the System.
Termination. UMR reserves the right to terminate Customer's System access (i) on the date Customer fails to
accept the hardware, software and browser requirements provided by UMR, including any amendments thereto or
(ii) immediately on the date UMR reasonably determines that Customer has (i) breached, or allowed a breach of, any
applicable provision of this Section or (ii) materially breached or allowed a material breach of, any other applicable
provision of this Agreement. Customer's System Access will also terminate upon termination of this Agreement,
provided however that if run -out is provided in accordance with Exhibit A - Statement of Work, Customer may
continue to access applicable functionalities within the Systems during the run -out period. Upon any of the
termination events described in this Agreement, Customer agrees to cease all use of Systems, and UMR will
deactivate Customer's identification numbers, passwords, and access to the System.
Schedule of Services
A_ CLAIMS ADMINISTRATION SERVICES
Service
Comments
Claims for Plan benefits must be submitted in a form that is satisfactory to UMR in order for UMR to determine whether a
benefit is payable under the Plan's provisions. Customer delegates to UMR the discretion and authority to use UMR's claim
procedures and standards for Plan benefit claim determination.
Implementation of Customer's benefit plans and payment
1 UMR will process only those claims which are incurred on or
of claims. _. _._. _.__.........................._after
........ ...
the effective date of this Agreement._.............._..._..__.._.....
......................__.._......................................-...._.........................................._........__ __ ...................._........._._.
Standard claims processing including:
In the event that Customer asks UMR to load data from the
• Re -pricing and payment of claims.
prior TPA regarding Participant's benefit accumulators, UMR
• Auto and manual adjudication using proprietary software.
will have no obligation to verify the accuracy of such data.
• Provide an Explanation of Benefits (EOB) notice to
Participants and Remittance Advice (RA) statement to
providers as required
• Prepare and mail 1099's to providers and other vendors,
using UMR's name and tax identification number.
---._...............---................. ..._.......... _.._......... .._............_..................._._
................... _... _._........................ ........... _......_................ _........_........... _.....
Standard coordination of benefits for all claims
UMR pays claims for Medicare -eligible persons as either
primary or secondary, based on the Medicare Secondary Payor
Rules.
...................................._..._..................._...._....................................._...._......._.._.._._....................._
........
Claims Run -Out Services. UMR will process all claims
.... ........................ .................. _.................... ................................. ....... _............................. ......_.__._......................................._..._........................_._...........
If the Agreement terminates because Customer fails to pay
received up to the date of termination of this Agreement.
UMR fees due, fails to provide the funding for the payment of
Any unprocessed claims will be denied, unless Customer
benefits, or UMR terminates for any other material breach, run -
requests claims run -out services (unprocessed claims incurred
:out will not apply.
prior to the termination date) at a mutually agreed upon fee
prior to the termination of this Agreement. In the event that
:Suspension of Run -out Processing
UMR receives claims after the run -out period expires then
. If Customer does not pay the run -out fees it owes UMR when
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Proprietary Information of UnitedHealth Group
Service
UMR will deny the claim.
Foreign service procedures
State Surcharges. If during the term of the Agreement
UMR receives a surcharge invoice from a state for the Plan or
claims paid under the Plan, UMR agrees to submit applicable
payments to the state on behalf of Customer. The amount
due to the state will be withdrawn from Customer's claims
bank account.
Claim Reprocessing. Customer requests to reprocess certain
claims.
Credit Balance Recovery Program.
New York Surcharge Services: Upon acceptance from the
New York Public Goods Pool, UMR agrees to compile and
forward to the State of New York, an electronic report that
shows the liability that Customer has for covered lives,
patient services and total amount due from Customer. The
report is compiled on a monthly or annual basis in
accordance with the requirements of the State of New York
for Customer. UMR agrees to file the report and send the
applicable payments to the State of New York via a draw
from Customer's bank account.
Comments
due as set forth above, UMR will notify Customer. If Customer
does not make the required payment UMR may stop issuing
checks and non -draft payments and suspend its run -out claims
processing under this Agreement, such suspension to apply to
all claims regardless of dates of service and shall remain in
effect until such date when Customer makes the required
payment.
Termination of Run -out Processing
Run -out claims processing will terminate if Customer fails to
provide the required funds for payment of benefits under the
terms of this Agreement. Such termination shall apply to all
claims regardless of dates of service.
... .........................._....................................._.... ................. _................ .............. ......_... _....................
Participants who receive services in a country other than the
United States must pay the claim and then submit the claim to
UMR for reimbursement. UMR will reimburse the Participant
for any covered amount in U.S. currency. The reimbursed
amount will be based on the U.S. equivalency rate that is in
effect on the date the Participant paid the claim, or on the date
of service if paid date is not known.
This service does not apply to New York Surcharges.
No fee is charged for claims being reprocessed in connection
with an error made by UMR.
A fee is charged for claims being reprocessed: a) as a result of
retroactive benefit or eligibility changes that Customer made or
in connection with other actions by Customer, its employees or
agents, or b) if Customer contracts directly with a provider
network and that provider network gives UMR incorrect or late
fee or other provider information that necessitates adjustment
o.f claims.
............ ............._.............. ............._._........... ---............ -_ ................... _.._......... --...... _............
UMR has a contract with a cost containment recovery vendor
that routinely reviews credit balances, primarily at large
hospitals and providers of service throughout the United States.
Vendor works with the hospital/provider to identify amounts
that have been overpaid due to inaccurate billings and other
reasons. Vendor then verifies that the patient was covered by a
Plan that UMR administers, and works with the facility or
provider to recover the overpayment for the Plan. The
applicable credit, less recovery fee, is forwarded to the
Customer.
....... .... ....................... ....__........................ _...---....... ................ ........_....................... - ... _.-.__._.._........................ ___.__..__..........
.....
It is understood that Customer is solely responsible for
completing necessary New York Surcharge election forms and
responding to inquiries regarding the election.
In the event that a claim is adjusted after the New York
Surcharge fee has been paid and the adjustment affects how
much the provider actually receives, UMR will make an
adjustment on a future report to the State.
14
Proprietary Information of UnitedHealth Group
R MFMRFR CERVICES
Service
Toll -free access to a customer care unit
........... .... _.._._......_...._..._...................._....._._........._..._............................... ...................... ........... ................................. ..._....................................
.
Employee access to a member website enabling Participants
to:
• Check claim status.
• Check eligibility information.
• Search for providers and online health information.
_...._...... —.--.._...._...-..._........................_.................._............................................ _...._......_..._.................
.....
Identification Cards.
UMR will provide standard Ill cards (including replacement
cards) for each employee who is covered under Customer's
Plan.
C Cr1STnMFR RF.PnRTING SERVICES
UMR will provide Customer with the following standard repo
Banking. Online access to the check register, searchable for
disbursement informati....... .--....._.........................----._........_.........)._._._..__ .......
Month) Online Reports Plan Performance). Online
access to monthly reports containing Plan performance
details. Customer can also use online data to develop ad -hoc
queries such as census information, claim activity and large
cl. ............ ..._....................__._...--- -.._...._.................. ............-_...... _......... ....................... _....... _......__...................
Eligibility and Benefits Inquiry. Online eligibility inquiry
provides Customer with access to Participant eligibility
information. Online benefit inquiry provides specific benefit
information for each Participant.
----- ---- ..._._._—._................_-.----.... _. .......... ..._........... -...... - __.................
Claims Inquiry. Customers can review the status of
participant claims online. Customer is responsible for
ensuring that its employees comply with HIPAA privacy
Comments
Customer may, at its option, order customized ID cards at an
additional cost.
Comments
online access.
Annual Report. Provides the information that Customer can
use to complete the 5500 form or 990 form_
..... ,............ __......... --- ........... _
Customization, non-standard or ad hoc reports _ Fees are determined on a report -specific basis
........... __...----............................... ---._ ..... .._...---
UMR reserves the right, from time to time to change the content, format and/or type of UMR's reports.
n CITHFR SERVICES
Service
Summary Plan Description (SPD) Assistance. UMR will
prepare a customized draft of an SPD for the Plan, one
additional draft, in response to Customer's comments and a
final draft SPD.
SPD Exception Processing. In the event Customer wants
UMR to make an exception to Customer's Summary Plan
Description (SPD), Customer must notify UMR in writing of
such exception using a form designated by UMR. Customer
is fully and solely responsible for any compliance or stop loss
issues that may occur as a result of making an exception to its
SPD.
._......--.
--................ .... ........... ......._.............. ._........................... ..................... _.._......... -.......................................... _.........._................ ......
Summary of Benefits and Coverage (SBC) Services. Upon
receipt of a completed service election form from Customer,
UMR agrees to provide the following (SBC) services:
• Draft one standard full SBC per benefit Plan design if
UMR is the only vendor administering benefits for
Customer; or
Comments
If the SPD is not finalized sufficiently in advance of the
Effective Date of UMR's services, UMR will utilize benefits
and exclusions that UMR has created based on its
understanding of Customer's Plan design and which Customer
has reviewed and approved UMR will administer claims and
otherwise provide UMR's services in accordance with
information and it will govern and remain in full force and
effect until a final SPD is provided to UMR.
........................._........__..._....................__....__._......__...... _..---._ .............
........_......_..
UMR shall not be liable to any degree when following
directions from Customer, its employees or agents, and
Customer agrees to indemnify UMR and hold it harmless from
and against any and all claims arising from Customer's
decision to make an exception to the SPD.
Customer is responsible for providing UMR with written
details about the Plan and benefit changes in an agreed upon
period of time prior to the date Customer needs the final SBC
from UMR.
Customer is responsible for completing sections of the SBC
related to Customer and external vendors, if any, and return
IS
Proprietary Information of UnitedHealth Group
Service
Draft one standard partial SBC per benefit Plan design if
UMR administers the medical Plan but Customer utilizes
external vendors for other benefits.
Provide one SBC update per year if needed.
Post the final approved SBC to UMR's web portal for
Customer.
Stop Loss Reporting. UMR will use commercially
reasonable efforts to identify, track and file paid specific stop
loss insurance claims with the stop loss carrier, on behalf of
Customer.
If Customer has aggregate stop loss coverage, UMR agrees to
notify the stop loss carrier of any potential Claims that
exceed the stop loss policy's attachment point.
Transition to new Third Party Administrator (TPA).
UMR will cooperate with Customers' transition to a new
TPA upon termination of this Agreement and will provide
cancellation reports to Customer upon request.
_........-----................. ..........------.......----..................._P__._........... .........................................................
Medicare Secondary Payer Reporting. UMR shall provide
to applicable parties the applicable reports in a time and
manner as required according to the Medicare Secondary
Payer Mandatory Reporting Provisions (the Reporting
Requirements) in Section I I I of the Medicare, Medicaid, and
SCHIP Extension Act of 2007. UMR shall not be
responsible for any noncompliance penalties in connection
with the Reporting Requirements that are related to
Customer's failure to provide the required data.
V PusuMery RFNF.FIT SERVICES
Comments
applicable details to UMR within an agreed upon timeframe.
Customer is responsible for complying with SBC regulations,
including but not limited to distribution of SBC's to
Participants. In the event that Customer requests UMR to
provide other non-standard SBC services, UMR will charge a
reasonable fee for..agreed upon services.
................... __... ... _................
...................
Customer is responsible for providing UMR with a copy of the
stop loss policy by the effective date of this Agreement or as
soon thereafter as reasonably possible, if UMR did not place
Customer's stop loss coverage with the carrier.
No priority will be given to process claims because the stop
loss year is coming to a close. In no event shall UMR have
any liability for coverage decisions taken or any omissions by
any stop loss insurance carrier, and UMR shall not be held
liable for any claims not covered by the stop loss carrier even if
such claims were paid by the Plan. It is understood that UMR
cannot represent or warrant a carrier's stop loss coverage or
any terms of a carrier's stop loss coverage.
Customer and its third party stop loss carrier may be required
to execute UMR's standard nondisclosure and indemnification
agreement nrior to UMR providing anv stop loss information
Customer agrees to provide to UMR in a timely manner and in
an agreed upon format any and all data that UMR requires to
comply with the Reporting Requirements.
Service
Comments
UMR through its Pharmacy Benefit Manager (PBM) affiliate will provide the Pharmacy Benefit Services described in this
Section.
............... _..........._........................................___._........._._......................._......_....................._...._.......................
....--------..........._..................._..._.__..._.._....................................__......................_................................._..._..........._...............................,.............._._.._.._.............._............
Pharmacy Network. UMR/PBM will make Network
Pharmacies available to Customer Participants.
• PBM will determine which pharmacies are Network
Pharmacies. Network Pharmacies can change at any time.
• PBM and UMR will make a reasonable effort to provide
Customer with advance notice if any material changes
occur to the network.
....... .._.............. _........................... _........ .....__._........................... ...... ......................... .._..._....................................................__............................
Claims. PBM shall accept and process claims submitted by
............._..............._......_......................_......................_..._............._......................._........_..._...__.........._._._...........................-.................................
Both parties understand that if pharmacy claims are paid for a
Participants when such Participant submits claims properly
Participant prior to being notified by the Customer that the
completed on a PBM standard paper claim form, together
Participant has been terminated, UMR and PBM will be under
with proper proof of payment.
no obligation to recover payments made prior to said
notification.
PBM uses criteria for its Quantity Limit Program that is
developed by its National Pharmacy and Therapeutics'
Committee. PBM will receive and review requests from the
Customer and/or Participants for exceptions based on this
criteria. Customer will at all times retain the right to override
In connection with prescription drug claims, there may be a
timing difference between when UMR withdraws funds from
Customer claims account and when PBM issues payments to
pharmacies and other payees. UMR and/or PBM may retain
16
Proprietary Information of UnitedHealth Group
Service Comments
the PBM recommendation, at which time the override will be interest earned on these amounts during this time. Interest is
entered into the system by PBM to allow coverage for the expected to be paid at overnight deposit rates by UMR's
product and quantity requested. banking institution.
PBM will provide claims appeal services for Participants who PBM maintains systems for processing pharmacy claims and
request a review of an Adverse Benefit Determination on may receive access fees as compensation for services PBM
pharmacy claims, as mutually agreed to by the parties. provides to Network Pharmacies.
PBM uses commercially reasonable efforts to not reimburse
Participants for prescription drugs purchased outside of the
United States, with the exception of prescription drugs
purchased for emergency purposes. An exception may also
be made for Participants who are covered by a United States
heal. ................._... .. ..._ . .......
Allocation and Payment of Rebates. UMR and/or PBM will
negotiate with drug manufacturers for the payment of
Rebates to UMR and/or PBM. The amount of Rebates that is
available depends on a number of factors. UMR agrees to
share rebates with the Customer to the extent stated on the
Fee Schedule. In the event, however, that Customer
terminates pharmacy services mid -Term, UMR and/or PBM
will retain any portion of unpaid rebates.
Customer agrees that all payments associated with Rebates
and any related interest are not due and owing to Customer
until UMR and/or PBM actually pays them to Customer
pursuant to this Agreement
F rnRRA SF.RVICF.S
Customer will only receive Rebates to the extent that Rebates
are actually received by UMR and/or PBM. In the event a
government action or a major change in pharmaceutical
industry practices eliminates or materially reduces
manufacturer Rebate programs, Customer's payment amount
may be reduced or eliminated. In such event, UMR shall
promptly notify Customer and revise or eliminate such
payment effective with the date of the reduction or elimination
in Rebate payments.
Service Comments
Specific to COBRA (the federal Consolidated Omnibus Budget Reconciliation Act of 1985, and all rules and regulations
promulgated thereunder), UMR is not a "Named Fiduciary" of the Plan as defined by the IRC. For Section 1 Definitions, the
term "Plan" will include health benefits which are subject to the continuation requirements of COBRA. In addition, the
following sections of the Agreement do not apply to the COBRA Program services:
• Claim Recovery Services and Third Party Liability Recovery
• Fraud and Abuse Management
• Benefit Determinations and Appeals
• Service Auditor Reports
And reference to Summary Plan Description (SPD) assistance does not
General Responsibilities of the Customer.
• The Customer shall be responsible for the administration
of COBRA, except to the extent expressly delegated to
UMR through this Addendum.
• Providing UMR with COBRA premium information and
due dates at least two (2) weeks prior to the effective date
of the change, and for complying with the COBRA
regulations governing the twelve (12) month
determination period.
• Determining if a Qualifying Event occurs and such
determination shall be binding upon UMR. Within thirty
(30) calendar days following notification of the Qualifying
Event, Customer shall notify UMR of the Qualifying
Event by either submitting a completed COBRA Action
Form, or submitting information via the COBRA Online
Web Notification system, or by utilizing another format
that is mutually agreed upon.
• Notifying UMR in a timely manner if Customer
determines or has reason to believe that the Qualified
Beneficiary is not entitled to COBRA.
-.._._..__.........._........................_...._._..__..-_._................................................................._........................................................._.......................................................
General Responsibilities of UMR.
17
Proprietary Information of UnitedHealth Group
I Service Comments I
• Providing the initial (general) COBRA written notice to
newly hired employees, to those enrolling due to a change
in status (special enrollment), and to new spouses, for the
fee as stated on the Fee Schedule.
• Upon notification from Customer of a Qualifying Event
via the COBRA Action form or another acceptable means
of written communication, UMR shall send a letter to the
Qualified Beneficiaries advising them of their rights to
continue coverage under federal COBRA including
enrollment and payment information.
• Upon receipt of a completed enrollment form and
appropriate payment, send a letter of confirmation to the
COBRA Enrollee acknowledging such receipt.
• Collecting COBRA monthly payments from enrollees and
provide Customer with a monthly accounting of payments.
All such payments shall be retained by UMR until the
month end and then shall be returned to Customer in a
mutually agreed upon manner.
• In the event that a COBRA Enrollee's coverage terminates
prior to the end of the maximum COBRA coverage
period, UMR shall provide the COBRA Enrollee with a
written notice of early termination in accordance with
applicable federal COBRA regulations.
• Sending a Notice of Unavailability to a Qualified
Beneficiary if it is determined by the Customer or UMR
that the Qualified Beneficiary is not entitled to COBRA
coverage in accordance with applicable federal COBRA
COBRA services for Qualified Beneficiaries who are
enrolled in a benefit plan with Customer's outside
carrier(s).
• Upon notification from the Customer that a Qualifying
Event has occurred, UMR will send a letter to the
Qualified Beneficiaries advising them of their rights to
continue coverage under federal COBRA including
enrollment and payment information.
• UMR will consider a Qualified Beneficiary's election and
payments to be timely if the election form and monthly
payments are received by UMR or postmarked by the due
date or within the thirty day grace period. UMR assumes
no liability if the outside carrier does not consider these
timely, or if there are conflicts with the insurance policy.
Customer is fully and solely responsible for ensuring that its
insurance policies or contracts with outside carriers are in
compliance with COBRA regulations.
Customer is responsible for notifying the outside carriers that
all COBRA election forms and premium payments will be sent
directly to UMR.
UMR assumes no liability for meeting state insurance
regulations for the outside carriers or Customer.
The outside carriers that the Customer contracts with are fully
and solely responsible for meeting all applicable insurance
regulations.
Ci. P'LEXIBLE SPENDING ACCOUNT (PbA) SERVICES
Service Comments
General Responsibilities of the Customer.
• Customer is responsible for the administration and
compliance of the FSA Plan(s), except to the extent
expressly delegated to UMR through this Agreement.
• Providing eligible employees with information on the
Plan(s) and any applicable regulations.
• Obtaining compensation reduction agreements, as
applicable, from eligible employees who have elected to
receive #ualified Plan benefits on a pre-tax basis.
_.._..._...._._..._................................................_........................................._.._.. . ........... _. ..................
General Responsibilities of UMR. In the event that unused funds remain in the account for a
• Provide claims terminated employee or an employee who is no longer eligible
• Provide an Employer Forfeiture Report that will be to participate in the Plan, those amounts will be reflected
available online each month. within the Employer Forfeiture Report available at the end of
• Provide covered employees access to their account the month after any run -out period has ended.
18
Proprietary Information of UnitedHealth Group
Service
information on UMR's 24-hour website and interactive
voice response system.
• At Customer's request, UMR will send a Time Is Running
Out letter to covered employees after the end of the Plan's
third quarter.
Debit Card. UMR contracts with an outside vendor to
provide two debit cards to eligible employees. UMR will be
responsible for loading each person's available amounts on to
the debit card system at the start of each new Plan year and
ongoing as described in Customer's SPD, so that the card
only covers qualified expenses up to the available balance in
the employee's account(s).
Comments
Customer is responsible for sending applicable amounts to
UMR prior to the start of each new Plan year, for updating
UMR if a change is made mid -year, and for providing other
Plan -related information that may be needed by UMR for this
service.
H. SHORT-TERM DISABILITY PLAN SERVICES
Service
General Responsibilities of Customer
• Provide UMR with necessary disability information as
needed to administer the Plan.
• Notify UMR as soon as a Participant returns to work from
disability leave. UMR will continue to apply normal Plan
_provisions until notified of a Participant change in status.
General Responsibilities of UMR
• Verification of Participant eligibility upon receipt of
claim.
• Review completed forms from Customer, Participant and
attending physician
• Provide the Participant with the status of their disability
claim (benefit check issuance or letter of benefit denial)
• Determine typical duration for each claim
• Follow up with attending physician and Customer to
determine return to work date.
• Withhold involuntary deductions from the disability check
(i.e. child support) as ordered by a court of law, and other
deductions from the disability check as stated in
Customer's Summary Plan Description.
• Issue yearly W-2's for disability payments made to
Participants. All tax reporting (excluding FUTA and SUI
taxes) will be done utilizing UMR's tax identification
number.
• Issue a check, if applicable, directly to the Participant on a
scheduled basis.
• Provide disability case management services for
appropriate cases, as determined by UMR.
• Provide a monthly Disability Claim Summary report
• Provide a weekly financial report that details each
transaction that is processed.
........_.....__.................................__.._....._._..............................................._..._.__....._...._....................................................................._.
Disability Taxes (if applicable to Customer's Plan)
• UMR shall withhold state income, federal income and
both employee and Customer portions of FICA (Social
Security and Medicare) taxes from the disability check as
required by the Internal Revenue Service and state
regulations. UMR will then deposit all tax withholds with
the appropriate governmental entity.
• UMR will withhold federal income taxes and FICA.
Customer must provide UMR with a copy of the
employee's W-4 form with the initial Claim so that UMR
can determine the appropriate withholding rate. In the
event Customer does not provide UMR with the
employee's W-4, UMR will withhold pertinent federal
Comments
UMR does not guarantee recoupment of funds paid to the
Participant prior to being notified of the Participant's return to
work or other ineligibility status.
For Participants where UMR is unable to determine the
person's total disability status, additional services can be
provided at the Customer's expense:
Refer case for an Independent Review. Reviews are done by
board certified physicians providing a retrospective review of a
provider's medical treatment plan to determine medical
necessity and appropriateness of the medical treatment
rendered. The independent reviewer prepares a comprehensive
report including a determination of a disability or non -
disability.
Refer case to an Independent Medical Exam. An onsite
medical exam performed by an independent physician to
determine an individual's current disability status.
Refer case for a Functional Capacity Exam (FCE). An exam
is performed that includes extensive tests done by a licensed
therapist to assess factors that affect a person's ability to
perform specific job tasks and activities of daily living..
Conduct disability investigations. Activity checks, limited
continuance of disability, initial disability evaluation, pre-
existing investigation, home visit or surveillance.
The Customer is responsible for calculating and depositing
federal unemployment (FUTA) and state unemployment (SUI)
taxes as it relates to disability payments under this Agreement.
UMR shall have no responsibility for FUTA and SUI taxes,
other than to provide the Customer with necessary information
on a weekly and quarterly basis to enable the Customer to
perform this function.
It is understood that federal income and FICA taxes are not
applicable to the portion of the Plan that is funded by an
employee's after tax contributions.
19
Proprietary Information of UnitedHealth Group
Service I Comments
taxes at the most current rate as required by law. When
applicable, UMR may also require Customer to provide a
co of the state's version of the W-4.
................p.Y.............................................. _._-._._......................................................_........ _..... .......................... ........ ......
Overpayments (Disability Plans).
• UMR will request money back from the Participant on
three occasions as needed, if an overpayment is at least
fifty dollars. If the Participant has not returned the money
and the overpayment is at least three hundred dollars,
UMR will send the overpayment file to an outside
collection agency if approved by Customer.
• Customer will be responsible for paying the applicable
commission of the recovery agency unless the
overpayment arises out of or is based upon UMR's gross
ne li ence in the erformance of its duties.
_..__....$......Iz.................._................._.... P....................................................._....._....--...................................................................................:..........................................................................................................................................................................................................................._............_............
Banking - Liability for Benefits. UMR will arrange for
payment and temporarily fund claims and associated taxes on
behalf of Customer with its operating funds. UMR will then
initiate a periodic claim draw from Customer's account to
reimburse UMR for the applicable claim and tax dollars.
UMR shall suspend payment of covered services if Customer
has not made the requisite funds available to UMR in
accordance with this Agreement.
20
Proprietary Information of UnitedHealth Group
EXHIBIT B - SERVICE FEES
This exhibit lists the fees Customer must pay UMR for UMR's services during the term of the Agreement. Unless
otherwise noted, these fees apply for the period from January 1, 2017 through December 31, 2017. Customer
acknowledges that the amounts paid for administrative services are reasonable.
Medical Fees
0001
Base Medical Fee
1/l/2017— 12/31/2018
$25.80 PEPM
1/l/2019— 12/31/2019
$26.25 PEPM
9928
Monthly Medical Fee Waiver
First month of purchased
PEPM service medical fees
waived (excluding
commission), subject to the
repayment terms in this
exhibit.
Short -Term Disability Fees
0001
Base Short -Term Disability Fee
1/l/2017— 12/31/2018
$2.47 PEPM
1/l/2019— 12/31/2019
$2.59 PEPM
0165
Check Cut and Full Service (short-term disability services)
$0.10 PEPM
Dental Fees
0001
Base Dental Fee
1/1/2017— 12/31/2018
$3.00 PEPM
1/l/2019— 12/31/2019
$3.15 PEPM
Flexible Spending Account (FSA) Fees
0001
Base FSA Fee (Health Care Account)
1/l/2017 — 12/31/2018
$4.75 PEPAPM
1/1/2019-12/31/2019
$4.99 PEPAPM
Base FSA Fee (Dependent Care Account)
1/l/2017— 12/31/2018
$3.75 PEPAPM
I/l/2019 — 12/31/2019
$3.94 PEPAPM
0164
Debit Card
$1.40 Per Card Per Month
COBRA Fees
0528
COBRA Notification letter to new hire
Included in Service Code
0529
0529
Standard COBRA Services
1/l/2017— 12/31/2018
$1.05 PEPM
1/l/2019— 12/31/2019
$1.10 PEPM
0530
Multiple COBRA lines Administration
Included in Service Code
0529
0531
COBRA Administration for Outside carriers
$0.05 PEPM per carrier
ID Card Services
0200
Mail ID Cards to Employee's Home
Included in Base Fee
Banking Services
0307
Custodial Banking Maintenance Charges
$250 Per Month
Reporting/Special Data Services
0417
Custom Ad -Hoc Reports — Request System
$100/hr. after 2 hours per
year
1203
New York Surcharge — Filing and Administration
Included in Base Fee
21
Proprietary Information of UnitedHealth Group
UMR
Network/Managed Care
1406
Network Access Fees
• Dental
$0.90 PEPM + 25% of
Savings for Connection
Dental Overlay
• UnitedHealthcare Choice Plus
Included in Base Fee
9938
Cost Reduction &Savings Program(CRS) (Cost reduction services aimed at
30% of savings through
generating savings on claims when the primary network is not utilized.
12/31/2019
Care Management and Outreach Services
0742
Stand-alone Utilization Management (Examination of medical services for
appropriateness of care prior to services being provided, in accordance with
Employer's SPD. Also includes independent medical reviews needed for this
service. In the event that Medicare is the primary payer for a Claim, these
services will be provided after Medicare funds have been exhausted.)
1/1/2017— 12/31/2018
$1.75 PEPM
1/l/2019— 12/31/2019
$1.84 PEPM
0743
Stand-alone Case Management (Individual case management services will be
provided to Participants who meet the criteria for case management including
complex treatment plans, catastrophic events, trauma and chronic illness. In the
event that Medicare is the primary payer for a Claim, these services will be
provided after Medicare funds have been exhausted.)
1/1/2017— 12/31/2018
$1.75 PEPM
1/l/2019-12/31/2019
' $1.84 PEPM
9918
NurseLines"' - provides 24-hour access to registered nurses
1/1/2017 — 12/31/2018
$0.50 PEPM
1/1/2019 — 12/31/2019
$0.53 PEPM
Claim Services
0105
Subrogation Services
30% of recoveries
0174
Credit Balance Recovery
20% of recoveries
0136
Preferred Stop Loss Interface Fee
Included in Base Fee
0140
Claim Renrocessine
$25 per Claim
2130
Federal External Reviews
$500 per review after five
reviews
0926
Full/Partial Summary of Benefits and Coverage (SBC) creation with data UMR
Included in Base Fee
has on file for the Plan. Includes initial SBC plus one amendment per year;
electronic version only provided to Customer.
0927
Two or more Summary of Benefits and Coverage (SBC) amendments requested
$500 Per SBC Per Benefit
by Customer per year
Plan
0167
Medical Insured Carve Out Coordination (Coordination of case management and
claim services with an insured medical carve -out carrier of Customer's.)
1/l/2017 — 12/31/2018
$0.35 PEPM
1/1/2019 — 12/31/2019
$0.37 PEPM
0175
Plan Advisor for Members with IVR (Model 1)
1/1/2017 — 12/31/2018
$2.20 PEPM
1/1/2019— 12/31/2019
$2.31 PEPM
1014
Support for Integrated Rx-Medical Accumulators
1/1/2017 — 12/31/2018
$1.00 PEPM
1/1/2019 — 12/31/2019
$1.05 PEPM
1101
On site customer location monthly/quarterly meetings
1 onsite meeting annually,
assuming local business
travel and normal business
hours
PEPM means Per Employee Per Month (covered employee)
PEPAPM means Per Employee Per Account Per Month (covered employee)
22
Proprietary Information of UnitedHealth Group
UMR
The above fees do not include state or federal surcharges, assessments, or similar taxes imposed by governmental
entities or agencies on the Plan or UMR, including but not limited to those imposed pursuant to The Patient
Protection and Affordable Care Act of 2010, as amended from time to time as these are the responsibility of the
Plan.
A stop loss interface fee surcharge applies if stop loss coverage is not placed with a UMR preferred market. Consult
your UMR representative for a list of preferred markets.
Certain pharmacies may be exempt from the above rates and discounts if they are located in a state that elects to
participate at a state fee schedule rate.
UMR agrees to use commercially reasonable efforts to ensure that the Plan remains cost neutral when Average
Wholesale Pricing (AWP) modifications occur, however it is understood that UMR has no control over changes in
federal, state or other applicable law or regulation that requires AWP modifications, or if there is a material change
to the AWP as published by the pricing agency that establishes Average Wholesale Prices.
Conditions:
• Requires a two year agreement with UMR. Early termination is subject to the early termination penalty
outlined in the Agreement.
• Assumes an enrolled employee count within 15% of the quoted employee count of 401.
• Assumes an effective date of January 1, 2017.
• One month fee waiver is calculated after any credits are applied.
Early Termination Fees. UMR has provided Customer with special pricing for administrative services that includes
multi -year fee guarantees and waived fees. In exchange for such special pricing, Customer agrees to repay UMR the
following amounts if Customer terminates this Agreement prior to the end of the initial two-year term for reasons
other than UMR's material breach of the Agreement:
• If Customer terminates the Agreement during the initial year of the Agreement, Customer shall pay UMR
100% of the waived fees.
• If Customer terminates the Agreement during the second year of the Agreement, Customer shall pay UMR
50% of the waived fees.
OptumRx Pharmacy Services
Plan Effective Date : 1/1/2017
Pharmacy benefits provided through OptumRx". The following fees apply to all retail network pharmacies, with
the exception of pharmacies located in states that may elect to participate on a state -fee schedule. Fees assume the
pharmacy benefits program is not a discount -card program.
The Limited Network is also available upon request and will provide additional discounts beyond the discounts
outlined below. This network provides deeper discounts, but requires members to utilize a restricted network of
pharmacies.
Published AWP
Electronic claim adjudication - per claim
$0.00
Retail
Brand discount, plus dispensing fee
16.75%+ $1.40
Net effective generic discount, plus dispensing fee
70.75% + $1.40
Mail Order
Brand discount, plus dispensing fee
21.50% + $0.00
Net effective generic discount, plus dispensing fee
75.75% + $0.00
Retail 90 Rx (Optional)
Brand discount, plus dispensing fee
19.00% + $2.00
23
Proprietary Information of UnitedHealth Group
UMR
Net effective generic discount, plus dispensing fee
70.75% + $2.00
Rebate Share
Non-incentivized rebate share (retail) - per Brand claim returned to the client
$26.40
Non-incentivized rebate share (mail order) - per Brand claim returned to the client
$85.80
Incentivized rebate share (retail) - per Brand claim returned to the client
$33.00
Incentivized rebate share (mail order) - per Brand claim returned to the client
$110.00
Premium PDL rebate share (retail) - per Brand claim returned to the client
$41.25
Premium PDL rebate share (mail) - per Brand claim returned to the client
$137.50
Additional Programs
Prior authorizations - per clinical prior authorization
Included
Specialty drugs are priced on an individual drug basis, with an estimated average aggregate specialty discount
around 14.5%.
Compound Drug Claim Pricing: AWP less Standard Contracted Discount + $7.50 Dispensing fee.
Rebate Fee Credit
City of Richmond, Indiana may elect to immediately receive the benefit of any rebate offered in the Rebate Share
section above to reduce their monthly medical administration fees. If City of Richmond, Indiana selects this option,
100% of rebates are retained by OptumRx, UMR is paid a service fee that is used to lower the medical
administration fee. This option allows City of Richmond, Indiana to enjoy the immediate cash flow benefit of their
rebates and eliminates the six to nine month lag in receipt of rebates.
'An additional $1.75 per claim applies to the electronic per claim fee for paper claims.
Pharmacy Conditions
Fees proposed assume the use of OptumRx as the pharmacy benefits manager.
Retail and mail order guarantees are reconciled in the aggregate.
Rates exclude compound, Direct Member Reimbursement claims, (i.e.: Paper Claims) and Vaccines.
Administrator may change pricing (a) any time City of Richmond, Indiana initiated changes are made to the Benefit
Plan, Formulary, Pharmacy Network, or a utilization management program, that adversely impact Administrator's
compensation, cost to provide services or ability to satisfy a guarantee (b) when there are changes in Laws and
Regulations after the date this quote was provided that affect or are related to the services outlined in this cost
proposal (c) when City of Richmond, Indiana asks and Administrator agrees to perform any service in addition to
the services outlined in this cost proposal; or (d) if there is a change in market conditions or utilization or the total
number of Members decreases by 10% or more after the date this quote was provided. Any change in the pricing
required by the changes will be effective as of the date the changes occur, even if the date is retroactive.
All rates, fees and guarantees are contingent upon OptumRx serving as City of Richmond, Indiana's exclusive
provider of core prescription drug benefit plan, Mail Order Pharmacy, and specialty pharmacy services from
OptumRx's specialty pharmacies or any participating pharmacy in OptumRx's retail pharmacy network. Additional
fees apply if another mail provider is selected.
Medicare Part D Wrap plans are required to use fixed fee pricing.
Groups with in-house pharmacies utilizing 340B or GPO pricing are required to use Fixed Fee pricing.
Rebate guarantees and generic AWP discounts may be adjusted proportional to the impact of unexpected releases of
generic products to market, or the withdrawal/recall of existing branded products.
Generic discount and dispensing fee guarantees cover Multi -Source products only. A Multi -Source product is
defined as one that is manufactured by more than two generic manufacturers. The brand discount and dispensing fee
guarantees apply to non -Multi -Source products.
Discounts and dispensing fees exclude Specialty Drugs and certain non -specialty injectable products.
Rates for extended days' supply apply to participating pharmacies only.
Deductible integration of prescription drug and medical claims requires daily connectivity between the pharmacy
benefits manager and the plan administrator, additional coordination fees apply. External vendors are subject to prior
approval.
Rebate Management Terms
All rebate guarantees are subject to the following terms:
24
Proprietary Information of UnitedHealth Group
UMR
Non-Incentivized
City of Richmond, Indiana's adoption, without deviation, of OptumRx's formulary and utilization management
programs, as well as any changes OptumRx makes to its formulary or utilization management.
Incentivized
City of Richmond, Indiana's adoption, without deviation, of OptumRx's formulary and utilization management
programs, as well as any changes OptumRx makes to its formulary or utilization management.
A minimum of $10 difference in copayment, or 10% difference in coinsurance between preferred and non -preferred
Brand Drugs.
Premium PDL
City of Richmond, Indiana's adoption, without deviation, of OptumRx's formulary and formulary exclusions, as
well as any changes OptumRx makes to its formulary and formulary exclusions.
Implementation of the step therapies required by OptumRx in the following therapeutic classes: Rheumatoid
Arthritis, Ankylosing Spondylitis, Plaque Psoriasis, Psoriatic Arthritis, Hepatitis-C, Multiple Sclerosis and PCSK9.
Rebate claims exclude ineligible claims, such as Prescription Claims with invalid service provider identification or
prescription numbers; where, after meeting the deductible, the Member's Cost -Sharing Amount under the applicable
Benefit Plan requires the Member to pay more than 50% of the Prescription Claim; that are manufacturer negotiated
fee products not listed on City of Richmond, Indiana's Formulary for devices without a Prescription Drug
component; that are re -packaged NDCs; from 340B which typically receive a discount or rebate directly from Drug
Manufacturers under section 340B of the Public Health Service Act, or entities eligible for federal supply schedule
prices (e.g., Department of Veterans Affairs, U.S. Public Health Service, Department of Defense); or that are not for
Prescription Drugs (except for insulin or diabetic supplies).
If City of Richmond, Indiana makes any change to its Formulary, not initiated by OptumRx, or Benefit Plan, or
adopts any formulary or utilization management program other than one of the options offered by Administrator
under its formulary or utilization management programs, Administrator may adjust the Rebate guarantees, effective
the date of the change.
"AWP" means the average wholesale price, as reflected on the Pricing Source, of a Prescription Drug or other
pharmaceutical products or supplies based on the NDC of the Drug dispensed. Administrator will rely on the Pricing
Source as updated by Administrator no less frequently than every seven days to determine AWP for purposes of
establishing the pricing provided to City of Richmond, Indiana under this agreement. Administrator will not
establish AWP, and Administrator will have no liability to City of Richmond, Indiana arising from use of the Pricing
Source. If Administrator decides to use a pricing benchmark other than AWP or is required to do so because the
Pricing Source discontinues publication of AWP and the change would materially affect City of Richmond,
Indiana's economic benefit under this agreement, then Administrator will provide City of Richmond, Indiana with
modified pricing terms at least 30 days before the effective date of the change. If the parties fail to agree upon the
modified pricing terms before the effective date of the modified pricing terms, then Administrator's proposed
modified pricing terms will apply until the parties otherwise agree. If the parties are unable to agree to modified
pricing terms, then either party may terminate this agreement upon 60 days prior notice to the other party.
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EXHIBIT B - SERVICE FEES (2018 RENEWAL)
This exhibit lists the fees Customer must pay UMR for UMR's services during the term of the Agreement. Unless
otherwise noted, these fees apply for the period from January 1, 2018 through December 31, 2018. Customer
acknowledges that the amounts paid for administrative services are reasonable.
Medical Fees
0001
Base Medical Fee
1/1/2018 — 12/31/2018
$25.80 PEPM
1/1/2019 — 12/31/2019
$26.25 PEPM
Short -Term Disability Fees
0001
Base Short -Term Disability Fee
1/l/2018 — 12/31/2018
$2.47 PEPM
1/l/2019 — 12/31/2019
$2.59 PEPM
0165
Check Cut and Full Service (short-term disability services)
$0.10 PEPM
Dental Fees
0001
Base Dental Fee
I/l/2018 — 12/31/2018
$3.00 PEPM
1/1/2019 — 12/31/2019
$3.15 PEPM
Flexible Spending Account FSA Fees
0001
Base FSA Fee (Health Care Account)
I/l/2018 — 12/31/2018
$4.75 PEPAPM
1/l/2019 — 12/31/2019
$4.99 PEPAPM
Base FSA Fee (Dependent Care Account)
1/1/2018— 12/31/2018
$3.75 PEPAPM
1/1/2019 — 12/31/2019
$3.94 PEPAPM
0164
Debit Card
$1.40 Per Card Per Month
COBRA Fees
0528
COBRA Notification letter to new hire
Included in Service Code
0529
0529
Standard COBRA Services
I/l/2018 — 12/31/2018
$1.05 PEPM
I/l/2019 — 12/31/2019
$1.10 PEPM
0530
Multiple COBRA lines Administration
Included in Service Code
0529
0531
COBRA Administration for Outside carriers
$0.05 PEPM per carrier
ID Card Services
0200 Mail ID Cards to Employee's Home Included in Base Fee
Banking Services
0307 Custodial Banking Maintenance Charges $250 Per Month
0417 1 Custom Ad -Hoc Reports — Request System $100/hr. after 2 hours per
year
0418 Creditable/Non-Creditable Coverage Disclosure Certificate for Medicare Part D $1.25 per Certificate, subject
(if re uested) to a $100 minimum
1203 New York Surcharge — Filing and Administration Included in Base Fee
1406 Network Access Fees
• Dental $0.90 PEPM + 25% of
Savings for Connection
Dental Overlay
• UnitedHealthcare Choice Plus Included in Base Fee
9938 Cost Reduction & Savings Program (CRS) (Cost reduction services aimed at 30% of savings through
generating savings on claims when the primary network is not utilized. 12/31/2019
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Care'Management and Outreach Services
0742
Stand-alone Utilization Management (Examination of medical services for
appropriateness of care prior to services being provided, in accordance with
Employer's SPD. Also includes independent medical reviews needed for this
service. 1n the event that Medicare is the primary payer for a Claim, these
services will be provided after Medicare funds have been exhausted.)
1/l/2018— 12/31/2018
$1.75 PEPM
1/1/2019— 12/31/2019
$1.84 PEPM
0743
Stand-alone Case Management (Individual case management services will be
provided to Participants who meet the criteria for case management including
complex treatment plans, catastrophic events, trauma and chronic illness. In the
event that Medicare is the primary payer for a Claim, these services will be
provided after Medicare funds have been exhausted.)
1/1/2018— 12/31/2018
$1.75 PEPM
1/1/2019 — 12/31/2019
$1.84 PEPM
9918
NurseLines"' - provides 24-hour access to registered nurses
1/1/2018 — 12/31/2018
$0.50 PEPM
1/l/2019 — 12/31/2019
$0.53 PEPM
Maim Services
0105
Subrogation Services
30% of recoveries
0174
Credit Balance Recovery
20% of recoveries
0136
Preferred Stop Loss Interface Fee
Included in Base Fee
0140
Claim Reprocessing
$25 per Claim
Other Fees
2130
Federal External Reviews
$500 per review after five
reviews
0926
Full/Partial Summary of Benefits and Coverage (SBC) creation with data UMR
Included in Base Fee
has on file for the Plan. Includes initial SBC plus one amendment per year,
electronic version only provided to Customer.
0927
Two or more Summary of Benefits and Coverage (SBC) amendments requested
$500 Per SBC Per Benefit
by Customer per year
Plan
0167
Medical Insured Carve Out Coordination (Coordination of case management and
claim services with an insured medical carve -out carrier of Customer's.)
1/l/2018— 12/31/2018
$0.35 PEPM
1/l/2019 — 12/31/2019
' $0.37 PEPM
0175
Plan Advisor for Members with IVR (Model 1)
1/l/2018 — 12/31/2018
$2.20 PEPM
1/1/2019— 12/31/2019
$2.31 PERM
1014
Support for Integrated Rx-Medical Accumulators
1/1/2018 — 12/31/2018
$1.00 PEPM
1/l/2019— 12/31/2019
$1.05 PEPM
1101
On site customer location monthly/quarterly meetings
1 onsite meeting annually,
assuming local business
travel and normal business
hours
PEPM means Per Employee Per Month (covered employee)
PEPAPM means Per Employee Per Account Per Month (covered employee)
The above fees do not include state or federal surcharges, assessments, or similar taxes imposed by governmental
entities or agencies on the Plan or UMR, including but not limited to those imposed pursuant to The Patient
Protection and Affordable Care Act of 2010, as amended from time to time as these are the responsibility of the
Plan.
A stop loss interface fee surcharge applies if stop loss coverage is not placed with a UMR preferred market. Consult
your UMR representative for a list of preferred markets.
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OptumRx Pharmacy Services
UMR through its Pharmacy Benefit Manager affiliate OptumRx will provide Pharmacy Benefits Services. The
following fees apply to all retail network pharmacies, with the exception of pharmacies located in states that may
elect to participate on a state -fee schedule. Fees assume the pharmacy benefits program is not a discount -card
program.
Published AWP
Electronic claim adjudication - per claim
$0.00
Retail
Brand discount, plus dispensing fee
18.25% + $1.20
Net effective generic discount, plus dispensing fee
76.25% + $1.20
Mail Order
Brand discount, plus dispensing fee
22.50% + $0.00
Net effective generic discount, plus dispensing fee
79.75% + $0.00
Retail 90 Rx (Optional)
Brand discount, plus dispensing fee
20.50% + $0.70
Net effective generic discount, plus dispensing fee
76.25% + $0.70
Rebate Share
Non-Incentivized rebate share (retail -excluding specialty) - per Brand claim returned to
the client
$53.00
Non-Incentivized rebate share (mail order -excluding specialty) - per Brand claim
returned to the client
$178.00
Non-Incentivized rebate share (specialty -retail & mail order) - per Brand claim returned
to the client
$392.00
Incentivized rebate share (retail -excluding specialty) - per Brand claim returned to the
client
$64.50
Incentivized rebate share (mail order -excluding specialty) - per Brand claim returned to
the client
$222.50
Incentivized rebate share (specialty -retail & mail order) - per Brand claim returned to the
client
$419.50
Additional Programs
Prior authorizations - per clinical prior authorization
Included
Specialty drugs are priced on an individual drug basis, with an estimated average aggregate specialty discount
around 16.0%.
Compound Drug Claim Pricing: AWP less Standard Contracted Discount + $7.50 Dispensing fee
An additional $1.75 per claim applies to the electronic per claim fee for paper claims.
Pharmacy Conditions
Fees proposed assume the use of OptumRxTM as the pharmacy benefits manager.
Discounts are based on Published AWP.
Discounted ingredient costs are based upon the actual 11 digit National Drug Code, specific to the quantity
dispensed submitted by a participating network pharmacy at the time of adjudication.
Discount guarantees are reconciled at the aggregate level.
Compounds, specialty claims, 340B claims, Indian Health Services and Tribal claims, direct member
reimbursement claims, coordination of benefit claims, long term care claims, home infusion claims, vaccines, in-
house pharmacies (if applicable) and claims filled outside the OptumRx network will be excluded from the
guarantees. Additionally, claims in Puerto Rico, Guam, Northern Mariana Islands, Virgin Islands, Hawaii,
Massachusetts, Alaska, and rural pharmacies will be excluded from the guarantees. Rates may be changed if
greater than 5% percent of utilization is incurred in Puerto Rico, Guam, Northern Mariana Islands, Virgin Islands,
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Hawaii, Massachusetts, Alaska, or rural pharmacies, individually or in the aggregate.
UMR reserves the right to modify or amend the financial provisions of this document upon prior notice to City of
Richmond in the event of (a) any government imposed change in federal, state or local laws or interpretation
thereof or industry wide change that would make UMR's performance of its duties here under materially more
burdensome or expensive, including changes made to the AWP benchmark or methodology; (b) a change in the
scope of services to be performed under this document upon which the financial provisions included in this
document are based, including a change in the plan design and the exclusion of a service line (i.e. retail, mail,
specialty) from City of Richmond's service selection; (c) a reduction of greater than ten percent in the total number
of members from the number provided to UMR during pricing negotiations upon which the financial provisions
included in this document are based; (d) unexpected movement of a branded product to off -patent or where there
are generic or over-the-counter substitutes available; or (e) implementation or addition of 100 percent Member paid
plans; or (0 UMR is no longer the exclusive specialty pharmacy provider
Pricing proposal assumes an exclusive specialty arrangement with BriovaRx Pharmacy.
The retail and mail order generic discounts exclude any generic drug that has two or fewer generic manufacturers;
the retail and mail order brand discounts include any generic drug that has two or fewer generic manufacturers.
Usual & Customary claims are included in the discounts guarantees.
Zero balance claims are included in the discount guarantees prior to the application of member copayment.
Retail 90 pricing is for retail claims with greater than 83 days' supply.
UMR will have no obligation under any financial guarantees under the contract for the contract year (i.e., each 12-
month period following the effective date) in which City of Richmond terminates, if the portion of the contract year
before the effective date of City of Richmond's termination is less than 12 full months.
Rebate Management Terms
All rebate guarantees are subject to the following terms:
Non-Incentivized
City of Richmond's adoption, without deviation, of OptumRx's formulary and utilization management programs, as
well as any changes OptumRx makes to its formulary or utilization management programs.
Incentivized
City of Richmond's adoption, without deviation, of OptumRx's formulary and utilization management programs, as
well as any changes OptumRx makes to its formulary or utilization management; and a minimum of $10 difference
in copayment, or 10 percent difference in coinsurance between preferred and non -preferred Brand Drugs.
Rebate claims exclude ineligible claims, such as claims with invalid service provider identification or prescription
numbers; claims where, after meeting the deductible, the Member's Cost -Sharing Amount under the applicable
Benefit Plan requires the Member to pay more than 50 percent of the claim; claims for devices without a
Prescription Drug component; claims for re -packaged NDCs; stale dated claims over 180 days old; compounds;
claims from 340B which typically receive a discount or rebate directly from Drug Manufacturers under section
340B of the Public Health Service Act, or claims from entities eligible for federal supply schedule prices (for
example, Department of Veterans Affairs, U.S. Public Health Service, Department of Defense); or claims that are
not for Prescription Drugs (except for insulin or diabetic supplies).
If City of Richmond makes any change to its Formulary, not initiated by UMR, or Benefit Plan, or adopts any
formulary or utilization management program other than one of the options offered by UMR under its formulary or
utilization management programs, UMR may adjust the Rebate guarantees, effective the date of the change.
Rebate guarantees may be adjusted in proportion to the impact of unexpected releases of Generic Drugs to market
or the withdrawal or recall of existing Brand Drugs.
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"AWP" means the average wholesale price, as reflected on the Pricing Source, of a Prescription Drug or other
pharmaceutical products or supplies based on the NDC of the Drug dispensed. UMR will rely on the Pricing
Source as updated by UMR no less frequently than every seven days to determine AWP for purposes of
establishing the pricing provided to City of Richmond under this agreement. UMR will not establish AWP, and
UMR will have no liability to City of Richmond arising from use of the Pricing Source. If UMR decides to use a
pricing benchmark other than AWP or is required to do so because the Pricing Source discontinues publication of
AWP and the change would materially affect City of Richmond's economic benefit under this Agreement, then
UMR will provide City of Richmond with modified pricing terms at least 30 days before the effective date of the
change. If the parties fail to agree upon the modified pricing terms before the effective date of the modified pricing
terms, then UMR's modified pricing terms will apply until the parties otherwise agree. If the parties are unable to
agree to modified pricing terms, then either party may terminate this Agreement upon 60 days prior notice to the
other party.
Certain pharmacies may be exempt from the above rates and discounts if they are located in a state that elects to
participate at a state fee schedule rate.
UMR agrees to use commercially reasonable efforts to ensure that the Plan remains cost neutral when Average
Wholesale Pricing (AWP) modifications occur, however it is understood that UMR has no control over changes in
federal, state or other applicable law or regulation that requires AWP modifications, or if there is a material change
to the AWP as published by the pricing agency that establishes Average Wholesale Prices.
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EXHIBIT C - BUSINESS ASSOCIATE AGREEMENT
This Business Associate Agreement ("BAA") is incorporated into and made part of the Administrative Services
Agreement ("Agreement") between UMR, Inc. on behalf of itself and its affiliates ("Business Associate") and City of
Richmond ("Covered Entity") and is effective on January 1, 2017 (Effective Date).
The parties hereby agree as follows:
1. DEFINITIONS
1.1 Unless otherwise specified in this BAA, all capitalized terms used in this BAA not otherwise defined have
the meanings established for purposes of the Health Insurance Portability and Accountability Act of 1996
and its implementing regulations as amended from time to time (collectively, "HIPAA").
1.2 "Privacy Rule" means the federal privacy regulations, as amended from time to time, issued pursuant to
HIPAA and codified at 45 C.F.R. Parts 160 and 164 (Subparts A & E).
1.3 "Security Rule" means the federal security regulations, as amended from time to time, issued pursuant to
HIPAA and codified at 45 C.F.R. Parts 160 and 164 (Subparts A & C).
1.4 "Services" means, to the extent and only to the extent they involve the receipt, creation, maintenance,
transmission, use or disclosure of PHI, the services provided by Business Associate to Covered Entity as
set forth in the Agreement, including those set forth in this BAA in Section 4, as amended by written
agreement of the parties from time to time.
2. RESPONSIBILITIES OF BUSINESS ASSOCIATE
With regard to its use and/or disclosure of Protected Health Information (PHI), Business Associate agrees to:
2.1 not use and/or disclose PHI except as necessary to provide the Services, as permitted or required by
this BAA and/or the Agreement, and in compliance with each applicable requirement of 45 C.F.R.
164.504(e), or as otherwise Required by Law; provided that, to the extent Business Associate is to
carry out Covered Entity's obligations under the Privacy Rule, Business Associate will comply with
the requirements of the Privacy Rule that apply to Covered Entity in the performance of those
obligations.
2.2 implement and use appropriate administrative, physical and technical safeguards and comply with
applicable Security Rule requirements with respect to Electronic Protected Health Information, to
prevent use or disclosure of PHI other than as provided for by this BAA and/or the Agreement.
2.3 without unreasonable delay, report to Covered Entity (i) any use or disclosure of PHI not provided for
by this BAA and/or the Agreement, of which it becomes aware in accordance with 45 C.F.R.
164.504(e)(2)(ii)(C); and/or (ii) any Security Incident of which Business Associate becomes aware in
accordance with 45 C.F.R. 164.314(a)(2)(i)(C).
2.4 with respect to any use or disclosure of Unsecured PHI not permitted by the Privacy Rule that is
caused solely by Business Associate's failure to comply with one or more of its obligations under this
BAA, Covered Entity hereby delegates to Business Associate the responsibility for determining when
any such incident is a Breach. In the event of a Breach, Business Associate shall (i) provide Covered
Entity with written notification, and (ii) provide all legally required notifications to Individuals, HHS
and/or the media, on behalf of Covered Entity, in accordance with 45 C.F.R. 164 (Subpart D).
Business Associate shall pay for the reasonable and actual costs associated with those notifications.
2.5 in accordance with 45 C.F.R. 164.502(e)(1)(ii) and 45 C.F.R. 164.308(b)(2), ensure that any
subcontractors of Business Associate that create, receive, maintain or transmit PHI on behalf of
Business Associate agree, in writing, to the same restrictions and conditions on the use and/or
disclosure of PHI that apply to Business Associate with respect to that PHI.
2.6 make available its internal practices, books and records relating to the use and disclosure of PHI to the
Secretary for purposes of determining Covered Entity's compliance with the Privacy Rule.
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2.7 after receiving a written request from Covered Entity or an Individual, make available an accounting of
disclosures of PHI about the Individual, in accordance with 45 C.F.R. 164.528.
2.8 after receiving a written request from Covered Entity or an Individual, provide access to PHI in a
Designated Record Set about an Individual, in accordance with the requirements of 45 C.F.R. 164.524.
2.9 after receiving a written request from Covered Entity or an Individual, make PHI in a Designated
Record Set about an Individual available for amendment and incorporate any amendments to the PHI,
all in accordance with 45 C.F.R. 164.526.
3. RESPONSIBILITIES OF COVERED ENTITY
In addition to any other obligations set forth in the Agreement, including in this BAA, Covered Entity:
3.1 shall provide to Business Associate only the minimum PHI necessary to accomplish the Services.
3.2 shall notify Business Associate of any limitations in the notice of privacy practices of Covered Entity
under 45 C.F.R. 164.520, to the extent that such limitation may affect Business Associate's use or
disclosure of PHI.
3.3 shall notify Business Associate of any changes in, or revocation of, the permission by an Individual to use
or disclose his or her PHI, to the extent that such changes may affect Business Associate's use or
disclosure of PHI.
3.4 shall notify Business Associate of any restriction on the use or disclosure of PHI that Covered Entity has
agreed to or is required to abide by under 45 C.F.R. 164.522, to the extent that such restriction may affect
Business Associate's use or disclosure of PHI.
3.5 In the event Covered Entity takes action as described in this Section, Business Associate shall decide
which restrictions or limitations it will administer. In addition, if those limitations or revisions materially
increase Business Associate's cost of providing Services under the Agreement, including this BAA,
Covered Entity shall reimburse Business Associate for such increase in cost.
4. PERMITTED USES AND DISCLOSURES OF PHI
Unless otherwise limited in this BAA, in addition to any other uses and/or disclosures permitted or required by
this BAA or the Agreement, Business Associate may:
4.1 make any and all uses and disclosures of PHI necessary to provide the Services to Covered Entity.
4.2 use and disclose PHI, if necessary, for proper management and administration of Business Associate or
to carry out the legal responsibilities of Business Associate, provided that the disclosures are Required
by Law or any third party to which Business Associate discloses PHI for those purposes provides
written assurances in advance that (i) the information will be held confidentially and used or further
disclosed only for the purpose for which it was disclosed to the third party or as Required by Law, and
(ii) the third party promptly will notify Business Associate of any instances of which it becomes aware
in which the confidentiality of the information has been breached.
4.3 de -identify PHI received or created by Business Associate under this BAA in accordance with the
Privacy Rule.
4.4 provide Data Aggregation services relating to the Health Care Operations of the Covered Entity in
accordance with the Privacy Rule.
4.5 use and disclose PHI and data as permitted in 45 C.F.R 164.512 in accordance with the Privacy Rule.
4.6 use PHI to create, use and disclose a Limited Data Set in accordance with the Privacy Rule.
5. TERMINATION
5.1 Termination. If Covered Entity knows of a pattern of activity or practice of the Business Associate that
constitutes a material breach or violation of this BAA then the Covered Entity shall provide written
notice of the breach or violation to the Business Associate that specifies the nature of the breach or
violation. The Business Associate must cure the breach or end the violation on or before thirty (30)
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days after receipt of the written notice. In the absence of a cure reasonably satisfactory to the Covered
Entity within the specified timeframe, or in the event the breach is reasonably incapable of cure, then
the Covered Entity may terminate the Agreement and/or this BAA.
5.2 Effect of Termination or Expiration. After the expiration or termination for any reason of the
Agreement and/or this BAA, Business Associate shall return or destroy all PHI, if feasible to do so,
including all PHI in possession of Business Associate's subcontractors. In the event that Business
Associate determines that return or destruction of the PHI is not feasible, Business Associate may
retain the PHI and shall extend any and all protections, limitations and restrictions contained in this
BAA to Business Associate's use and/or disclosure of any PHI retained after the expiration or
termination of the Agreement and/or this BAA, and shall limit any further uses or disclosures solely to
the purposes that make return or destruction of the PHI infeasible.
5.3 Cooperation. Each party shall cooperate in good faith in all respects with the other party in connection
with any request by a federal or state governmental authority for additional information and documents
or any governmental investigation, complaint, action or other inquiry.
6. MISCELLANEOUS
6.1 Construction of Terms. The terms of this BAA to the extent they are unclear shall be construed to
allow for compliance by Covered Entity and Business Associate with HIPAA.
6.2 Survival. Sections 5.2, 5.3, 6.1, 6.2, and 6.3 shall survive the expiration or termination for any reason
of the Agreement and/or of this BAA.
6.3 No Third Party Beneficiaries. Nothing in this BAA shall confer upon any person other than the parties
and their respective successors or assigns, any rights, remedies, obligations, or liabilities whatsoever.
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