HomeMy Public PortalAboutORD10769 f
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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
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ATTEST:
City Clerk
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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
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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.
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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.
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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: