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HomeMy Public PortalAboutORD10769 f t BILL NO. 86-163 SPONSORED BY COUNCILMAN HALSEY ORDINANCE NO. /c 76 J AN ORDINANCE OF THE CITY OF JEFFERSON, MISSOURI, AUTHORIZING THE MAYOR AND CITY CLERK TO ENTER INTO AN ADMINISTRATIVE AGREEMENT WITH EMPLOYEE BENEFIT ADMINISTRATORS , INC . , FOR THE ADMINISTRATION AND PROCUREMENT OF AN EMPLOYEE' S INSURANCE PLAN FOR THE CITY. BE IT ENACTED BY THE COUNCIL OF THE CITY OF JEFFERSON, MISSOURI, AS FOLLOWS: Section 1. The Mayor and City Clerk of the City of Jefferson are hereby authorized to enter into an administrative agreement with Employee Benefit Administrators , Inc . , for the administration of an employee's insurance plan for the City of Jefferson and for the purpose of authorizing Employee Benefit Administrators, Inc. , to act as agent for the City in the procurement of such a plan. Section 2. The agreement shall be substantially the same in form and content as Exhibit A attached hereto. Section 3. This Ordinance shall be in full force and effect from and after the date of its passage and approval. Passed �1!b��, _dze< t S� %SG Approved ?-cam ./ 1. ca. Pre iding Of f ickir Mayo ATTEST: City Clerk i ADMINISTRATIVE AGREEMENT This Agreement, made and entered into as of January 1, 1987 by and between the City of Jefferson (City) and Employee Benefit Administrators, Inc. (EBA) . WITNESSETH, WHEREAS, City has a program of medical, hospital, and health benefits ( "Plan" ) for certain of its employees and annuitants, and WHEREAS, City has requested EBA to furnish administrative services in connection with the Plan, and WHEREAS, it is the purpose of this Agreement to establish an agency relationship whereby EBA will undertake to act as agent for City in (i) receiving and processing claims for benefits under the Plan, (ii) disbursing claim payments under the Plan, and (iii) performing such additional duties as set forth herein. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, it is hereby agreed as follows: Section 1. Duties and Responsibilities of City (a) The City shall be the Plan Administrator (within the meaning of Section 3(15)(A) of the Employee Retirement Income Security Act of 1974 and Section 414(g) of the Internal Revenue Code of 1954) of the Plan, but it delegates all ministerial duties associated therewith -to the Claims Administrator. (b) The City shall have final authority in the decision regarding the insurance company or companies chosen to provide the insured protection under the Plan. (c) The City shall have final authority regarding the choice of benefits and provisions in the Self-Funded portion of the Plan, as outlined in the Plan Document. The City agrees to abide by and observe the provisions of the Plan Document. (d) The City shall be responsible For payment of all premiums required by the insurance companies, the expense of the Claims Administrator as hereinafter agreed to and the contributions to the Trust Account or Fund described in Section Three hereof, if one is established. In addition, the City shall be responsible for withholding any amounts from the pay of employees in the event employee contributions are required under the Plan and a payroll deduction or similar procedure is utilized therefor. Alk (e) The City agrees to take the following actions with respect to the Plan to facilitate proper administration by the Claims Administrator: ( 1 ) Supply the Claims Administrator with all information required with respect to employees and dependents eligible to participate in the Plan and notify the Claims Administrator of all changes occurring thereafter with respect to the eligibility status of all Plan participants. ( 2 ) Advise the Claims Administrator promptly upon acquisition of any new or different insurance contract or upon changes in the City's organization which might affect the status of the Plan as in effect at the time. (3) Provide the Claims Administrator with such additional information with respect to matters incidental to the Plan as may be requested by the Claims Administrator from time to time. (f) The City shall be the named fiduciary under the Plan with the authority to manage, acquire or dispose of the assets of the plan on a discretionary basis although such authority may be delegated, in whole or in part, to other fiduciaries as provided in the Trust Agreement, if there is one, or otherwise by an appropriate writing. (g) The City shall be the final determiner of all. appeals or denied claims insofar as the Self-Funded portion of the Plan is concerned. (h) The City shall be responsible for the status of the Plan under state insurance laws and under local, state and Federal tax laws. Section 2. Duties and Responsibilities of Claims Administration (a) Upon receipt of a claim for benefits, EBA shall review the claim and determine whether it has been properly filed and the amount, if any, which is due and payable with respect thereto. (b) EBA on behalf of the City shall disburse claim payments that EBA determines to be due in accordance with the provisions of the Plan to the person or assignee entitled thereto. (c) EBA shall take all reasonable steps to process claims and disburse claim payments accurately and expeditiously. (d) EBA'. also agrees 'to the following list of duties and responsibilities: 1. Notification to claimants and City of rejected claims and reason for the rejection. 2. Advising and aiding claimants in meeting requirements for additional information and proper t completion of claim forms. 3. Claim investigation. 4. Performing on a sample basis internal audits on claim payments. 5. Discussion of claims, where applicable, with physicians and other providers of services. 6. Obtaining and furnishing information, a s necessary , regarding non-duplicating or coordination of benefits. 7. Application of claims control procedures necessary to the effective implementation of the basic; principles of the Plan. 8. Preparation of monthly, quarterly, and annual claim reports on a timely basis. 9. Preparing for City information reports required in connection with claim payments under the Plan to providers of health care services pursuant to Section 6041, IRC. 10. Preparing a reconciliation of drafts cleared for the Plan. 11. Design and print Plan document. 12. Design Plan booklets describing benefits of the Plan an? -((liver booklets to City for issuance to employ, - s eligible under the terms of the administration Agreement. 13. Periodic review of claim experience and provision of underwriting advice. 14. Evaluation and payment or declination of the amount of claim presented, based on a schedule of benefits and taking into account, as necessary, the Coordination of Benefits provision. 15. Investigation of claims whose charges appear higher than regular and customary. 16. Storage of claim payment records. 17. Reporting to the IRS of payments to addressees as required. 18. Return of all claim files and related information to the City upon termination of the Agreement. A 1 1 19. Provide copies of employees' claim payment record to City for its information. 20. Provide periodic educational classes for City employees on the health insurance plan. 21. Administration of Consolidated Omnibus Budget Reconciliation Act (COBRA), including notification to employees and billing. 22. Solicitation of quotes from reinsurers as needed or directed by City. Section 3. Method for Payment of Claims (a) City shall maintain a Clearing Account with Central Trust Baru on behalf of the City which EBA shall utilize. The City will provide, through EBA, sufficient funds at all times to pay expenses incurred by the Plan. Any remaining balance and accrued interest on the account is the property of the Plan. EBA shall keep the City informed as to the balance in the clearing account and shall notify the City if additional deposits are needed to ensure prompt payment of claims. (b) Claims under the Plan shall be paid by a check payable Aft through Central Trust Bank prepared by EBA as agent for City. (c) In the event EBA pays any person less than the amount to which he is entitled under the Plan. EBA will promptly adjust the underpayment. In the event EBA overpays any person entitled to benefits under the plan, or pays benefits to any person not entitled to them, EBA shall take all reasonable steps to recover the overpayment except that EBA shall not be required to initiate court proceedings to recover an overpayment. EBA shall promptly notify the City if it is unsuccessful in recovering any overpayment. (d) The determination of the extent of the benefits to which any claimant is entitled under ';;he Plan shall initially rest with EBA. However, in the event that the City determines that EBA has misinterpreted the Plan and so informs EBA in writing, all claims reported after delivery of such writing to EBA shall be processed and paid in accordance with City's interpretation as set forth in such writing. Section 4. Additional Duties of EBA (a) The duties set forth herein may be modified by mutual agreement. The revised duties and the administration charges therefore, if any, shall be evidenced by written agreement between the parties hereto. (b) If any change in law or regulations imposes greater duties or obligations on EBA than contemplated by the Agreement in force at the time of such change, EBA shall promptly notify the City, and a change to this Agreement, including charges if required, will be negotiated. Section 5. Administration Charge ( a) The charge of City for services by EBA under this Agreement shall be $ 4.25 per. participating employee per month, plus $ -0- per participating dependent unit per month. This charge shall remain in effect for 1988 and 1989 unless significant changes in duties are directed and agreed upon. (b) By the 10th of each month, the City shall submit to EBA a statement showing additions and deletions of the named employees along with payment for that month of the administration charge determined on the basis set forth in the preceding paragraph. (c) Not less than ninety (90) days prior to renewal of any year in which this Agreement is in effect, EBA may propose in writing a revision in the administration charge for the following year with exception noted in paragraph (a) above. City shall advise EPA in writing as to the acceptability of such proposal within thirty (30) days after receipt thereof. If agreement is not reached with respect to such proposal at least thirty (30) days prior to such renewal, this Agreement shall terminate effective as of midnight of such renewal date. The foregoing shall be subject to any revisions in the administration charge pursuant to Sections 4 or 12 hereof. As used herein, "year" means any period of twelve consecutive months commencing on the effective data. Section 6. Determination of Elictibility In determining any person' s right to benefit under the Plan, EBA shall rely on eligibility information furnished by City prior to submission of the claim. It is mutually understood that the effective performance of this Agreement by EBA will require that it be advised by City periodically, but not less frequently than monthly during the term of this Agreement, of the identity of individuals eligible for benefits under the plan, the effective date of the termination date ( as the case may be) of their eligibility and the extent of the Benefits to which they are entitled. City shall also cause to be furnished to EBA such other information as may reasonably be required for the proper administration of the Plan. It is mutually agreed that EBA shall not be responsible for delay in the performance of this Agreement or for the non- performance of this Agreement which delay or non-performance is caused or contributed to by the failure of City to furnish any such information. AQh Section _7. Record Retention and Review EBA shall maintain records covering claims submitted under the Plan, as well as payments disbursed by EBA. Any duly authorized representative or representatives of City shall have the right to examine or audit such. records during the regular business hours of EBA. Section B. Agency Agreement (a) It is mutually recognized that EBA, in performing its obligation under this Agreement, is acting only as agent of City and shall not be designated or deemed the administrator with respect to the Plan for the purpose of the Employee Retirement Income Security Act of 1974 or any other Federal or State law of similar nature. (b) In the event that its officers, directors, employees, or agents are made parties to any judiciary or administrative proceeding arising in whole or in part out of any function performed by one or more of them under this Agreement, City shall hold them harmless for all judgments, settlements, and costs (including attorneys' fees) which they incur or pay in connection therewith, except City shall not reimburse the amount of any judgment or award (or attorneys' fees with respect thereto) if the court rendering the judgment or the agency making the award decrees that it was caused by the negligence, fraud, or criminal conduct of EBA, its agents, employees, officers, or directors. (c) The defense of any legal action instituted on a claim for benefits under the Plan shall not be an obligation of EBA. EBA shall, however, cooperate with City by furnishing such evidence as it has available in connection with the defense of any such action. Section 9. Laws Governing Contract This Agreement shall be governed by and shall be construed in accordance with the laws of the State of Missouri. Section 10. Term of Agreement This Agreement shall become effective on January 1, 1987, and end as of midnight December 31, 1987. It shall be renewed automatically for two successive periods of twelve (12) months unless City or EBA gives written notice to the other of intention not to renew the Agreement at least ninety (90) days prior to the end of the then current period. • r a Section 11. Modification of Agreement This Agreement constitutes the entire contact between the parties and no modification or amendment hereto shall be valid unless in writing and signed by the parties. Section 12. Modification of Plan (a) Any modification or amendment of the Plan shall be duly communicated in detail and in writing by City to EBA. Such communication shall also set forth the effective date of the modification or amendment. (b) Any revision in the administrative charge shall be mutually agreed to in writing by EBA and the City. (c) City shall furnish EBA with a copy of each modification or amendment of the Plan as soon as is practicable and in advance of the effective date of such modification, if possible. After receipt by EBA of a copy of the modification or amendment, the term "Plan" as used in this Agreement shall include each such modification or amendment as of the implementation date agreed upon by the parties hereto. Section 12. Termination of Agreement (a) This Agreement shall terminate upon the earlier of the following dates: (i) Ninety (90) days written notice by the City or EBA. (ii) On any other date mutually agreeable to City, and EBA. (iii) December 31, 1989. (b) In the event of termination of this Agreement, EBA shall complete processing of all claims for benefits under the Plan received prior to termination of the Agreement. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in duplicate as of the date first above written by their respective officers duly authorized to do so. FOR CITY OF JEFFERSON FOR EMPLOYEE BENEFIT ADMTNTSTART T?.q. IW.. BY MAYOR (--a:1 Dated Dated ATTEST: