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HomeMy WebLinkAboutC-2910I/dd -2a C 2Hre AGREEMENT FOR CLAIMS ADMINISTRATION SERVICES Article 1. GENERAL This Agreement is entered into on July 1, 2014 by and between the CITY OF ARCADIA ( "CITY "), a California public entity and AdminSure, Inc. ( "Administrator "), having an office at 1470 S. Valley Vista Drive, Suite 230, Diamond Bar, CA 91765. Article 2. SCOPE OF APPOINTMENT /RELATIONSHIP OF THE PARTIES Administrator, its agents and employees are hereby appointed as the City' agents and representatives to administer the City's self- insured workers' compensation program and process, evaluate, adjust and handle workers' compensation claims against the City. Administrator agrees to provide the services set forth in Article 4 of this Agreement. The relationship of Administrator and the City established by this Agreement is that of independent contractors, and nothing contained in this Agreement shall be construed to establish an employer /employee relationship or to constitute the parties as partners, joint ventures, co- owners, or otherwise as participants in a joint and common undertaking. Administrator, its agents and employees are representatives of the City only for the purpose of administering the City's self- insured workers' compensation program as set forth in this Agreement, and they have no power or authority as agent, employee, or in any other capacity to represent, act for, bind or otherwise create or assume any obligation on behalf of the City for any purpose whatsoever, except as specifically required to perform Administrator's obligations under this Agreement. Article 3. DURATION This Agreement applies to all work performed by Administrator which is described in Article 4, whether performed in anticipation of or following the execution of this Agreement. The initial term shall begin on July 1, 2014 and shall expire June 30, 2017. Subsequent annual terms from July 1, to June 30, may be mutually agreed upon between the parties. The Agreement shall automatically renew from year -to -year subject to termination by either party at any time during the life of the Agreement upon sixty (60) days written notice. The City of Arcadia maintains the right to terminate this Agreement if the City determines that it is in the best interest to do so, in the City's sole discretion and with or without cause. In the event that the City purchases workers' compensation insurance or its Certificate of Consent to Self- Insure is rescinded or revoked, this Agreement shall automatically terminate upon the effective date of such event. When this Agreement is terminated, the parties shall, as necessary, make an adjustment to the payment schedule in Article 6 to prorate fees through date of termination. Thereafter, the City shall pay Administrator moneys due and owing after such adjustment, if any, or 1of17 Administrator shall refund moneys due and owing City after such adjustment, if any. Adjustments due and owing shall be paid within 60 days after termination of the Agreement. Upon notice of termination of the Agreement, the Administrator will fully cooperate with the new Administrator, and the City in providing required information and service. Failure to fully cooperate will result in a 10% reduction in fees paid to the Administrator during the period of time the Administrator does not fully cooperate. Article 4. ADMINISTRATOR SERVICES Administrator will provide the City the following services: A. Claims Administration 1. Administrator will adhere to the Minimum Performance Standards enumerated in Addendum 1. 2. Provide all forms and reports necessary for the efficient operation of the City's programs of self- insurance with respect to workers' compensation claims and losses, and prepare and file all forms and reports required by law in a timely manner. 3. Identify each claim which has subrogation recovery potential. Initiate correspondence to effect collection, and follow up, as appropriate. Assist legal counsel where litigation is required to affect recovery. Establish, maintain and monitor monthly subrogation report which details all potential recoveries and statute of limitation dates. 4. Obtain settlement authority on all cases from the City. 5. Administrator will participate and assist the City in coordination of this program with other associated disability and medical programs. 6. At the request of the City, Administrator will attend hearings at no charge to the City. 7. Maintain records in accordance with legal requirements. 8. Perform other general administrative services, as necessary, to effectively discharge the City's duties to its employees and under the workers' compensation State statutes. B. Communication and Training 1. Attend California Insurance Pool Authority (CIPA) and City meetings as requested. 2. Conduct on -site formal educational programs for supervisors, managers and other staff responsible for managing the workers' compensation program as requested, and at least once a year. 3. Review open claims, procedures and other issues on -site at City, as 2of17 requested, and no more than quarterly for City. 4. Conduct meetings with City preferred medical providers to maximize effectiveness of procedures and medical care as requested, and no more than quarterly for City. 5. To the extent allowable by law, provide copies of file correspondence and documentation as requested by CIPA and /or City. C. State and Federal Reports 1. Prepare Self- Insurer's Annual Reports for City and /or CIPA's signature and submission to the State of California. 2. Prepare Federal Information Return (Forms 1099) for applicable payments. D. Information Management System 1. In coordination with CIPA and /or City, develop management reports that assist CIPA and /or City and Administrator in effectively managing the workers' compensation program. Standard Reports will be provided within ten (10) days after the end of the month or quarter. 2. Any hardware or cabling required by City to access the on -line system is City's responsibility. 3. The Administrator will report loss information to the excess insurance carrier(s), including CIPA, in accordance with established procedures. E. Consulting Provide a comprehensive Annual Program Review which: 1. Analyzes past statistics, program costs and projects future trends. 2. Recommends program changes to favorably impact costs and improve procedures. 3. Upon request, Administrator will provide a comprehensive program review more frequently than annually. F. Compliance Provide all aforementioned services in accordance with the applicable Workers' Compensation Laws of the State of California. G. Allocated Loss Expense "Allocated loss expense" shall mean all reasonable costs actually incurred by Administrator including, without limitation, all Workers' Compensation Appeals Board or court fees and expenses; fees for service or process; copy service; fees to retain attorneys; the cost of the services of investigators and detectives to 3of17 perform surveillance; and other professional assistance required to provide these services, if previously authorized by City. Allocated loss expense shall not include any costs or expenses incurred by Administrator in connection with services performed by it, which services are approved by CIPA and /or City and are normally performed in the course of administering workers' compensation claims. Allocated charges are to be paid by City. H. Index Bureau & Edex Charges Index Bureau and Edex charges will be paid by the Administrator. Copies of the reports will be distributed to City within 10 days of receipt. I. Storage of Closed Claims Administrator will provide storage of all closed claims, including storage of closed claims from prior administrator(s). Article 5. CITY OBLIGATIONS In connection with this Service Agreement, the City of Arcadia accepts responsibility to: A. Provide data to Administrator on a timely basis to permit compliance with State of California reporting requirements. B. Obtain and pay for excess insurance coverage, if desired by City. C. Arrange for checking account and provide appropriate funding. Article 6. COMPENSATION In consideration of the services provided by Administrator, the City agrees to pay Administrator the monthly fee as shown below. CIPA has no obligation to pay fees: A. Claims Administration B. Ancillary Services Ancillary services are not tied to this Agreement and may be purchased from another vendor at the option of the City. When purchased from Administrator, the fee shall be as follows: 4 of 17 Monthly Fee Monthly Fee Monthly Fee (7/1/14- (7/11/15- (7/1/16- 6/30/15) 6/30/16 ) 6/30/17 Arcadia $8,176 $8,299 $8,423 B. Ancillary Services Ancillary services are not tied to this Agreement and may be purchased from another vendor at the option of the City. When purchased from Administrator, the fee shall be as follows: 4 of 17 1. Bill Review a. The flat fee per bill is $9.00. b. The PPO fee is 20% of savings above the fee schedule with the exception of Blue Cross PPO which is at 23% of savings. If bill review services are not purchased from AdminSure, all electronic data interchange services will be provided by vendor, and not by AdminSure. 2. Utilization Review a. The Utilization Review fee is $85.00 per hour, billed at 10 minute increments. Examiners will perform Utilization Review in accordance with the Guidelines. b. Utilization review by a physician is billed separately at 10 minute increments, at the rate of $200 per hour. 3. Medical Provider Network Medical Provider Network fees, if utilized, will be billed at cost. Article 7. REIMBURSEMENTS The City agree to reimburse Administrator within thirty (30) days of presentation of an itemized statement for the costs of charges not considered allocated expenses or included in Administrator's fee, which are incurred on behalf of the City, provided the City has previously authorized such expense. Article 8. AUDITS Administrator agrees to cooperate with CIPA and the City in making any and all claim files and records available to CIPA and the City for audit by CIPA or the City's appointed representatives. During normal office hours, CIPA and /or the City's representatives shall have reasonable access to the necessary portions of Administrator's facilities, files and records for review or audit purposes, so as not to interfere with Administrator's normal business. Article 9. ASSIGNMENTS Neither party may assign this Agreement, in part or in total, without the express written consent of the other party. 5of17 Article 10. LEGAL RESPONSIBILITIES A. The Administrator shall comply with all State and Federal laws, as well as all county and municipal ordinances and regulations which in any manner affect the performance of services pursuant to this agreement, or persons employed by the Administrator. B. Administrator agrees that in the performance of the terms of this Agreement, no discrimination shall be made in the employment of persons because of race, color, national origin, ancestry, or religion of such persons. A violation of this provision will subject the Administrator to all penalties imposed by law. Article 11. INSURANCE A. Administrator shall provide to the City, on the effective date of this Agreement, Certificates of Insurance for the following coverages from insurance companies acceptable to the City. Administrator further agrees to maintain this insurance in full force and effect throughout the period of this Agreement, and any renewals or extensions thereof. All policies shall be endorsed to provide that the policy shall not be canceled or the coverage reduced until a thirty (30) day written notice of cancellation or reduction has been served upon the City except ten (10) days shall be allowed for non - payment of premium: 1. Commercial General Liability insurance with minimum limits of $1,000,000 per occurrence. 2. Automobile Liability insurance with minimum limits of $1,000,000 per accident. 3. Workers' Compensation with statutory limits, as required by the Labor Code of the State of California, and Employer's Liability with minimum limits of $1,000,000 per occurrence. 4. Professional Liability /Errors and Omissions insurance with minimum limits of $2,000,000 per occurrence. 5. Crime Loss or Fidelity Coverage with minimum limits of $1,000,000 per occurrence. Article 12. INDEMNIFICAITON Administrator shall defend, indemnify and hold harmless the City of Arcadia including its governing board, directors, officers, administrators, employees, and agents, from any and all claims, losses and liabilities against or incurred by the City arising out of the actions, omissions to act or other conduct of Administrator, its agents, employees or subcontractors, in the performance of its duties under this Agreement or otherwise in connection with its activities pursuant to this Agreement. This includes, but is not limited to, any breach by Administrator of its duties or responsibilities under the Agreement, as well as any losses occasioned by a failure of Administrator to provide 6 of 17 the services contracted for by the City pursuant to this Agreement. In addition, Administrator agrees to assume the defense, at Administrator's expense, using attorneys reasonably acceptable to the City of any lawsuit or other proceeding which names the City of Arcadia or its directors, officers, employees and agents as defendants. Article 13. BUSINESS LICENSE. Administrator shall maintain a business license for the City as required. Article 14. RIGHTS TO DATA All claim files, paper and computer, are and shall remain the property of the City of Arcadia. The City of Arcadia reserve the right to obtain original claim files, data discs, copies of reports and other documents applicable to the City in the event this Agreement is terminated. No documents shall be destroyed unless they have been scanned into the system. Original documents received after termination of this agreement shall be forwarded to the new administrator. Administrator shall bear the cost of relocating any claim files from the premises of Administrator to the premises of the City or designated party upon termination of the Agreement. Article 15. CONFIDENTIALITY It is agreed and understood that Administrator shall treat information, reports and analyses obtained or developed pursuant to this Agreement as being confidential. Prior written consent from the City shall be required before any information, in any format, is disclosed to any third party. It is further agreed and understood that Administrator shall produce, maintain and dispose of all such information, reports and analyses in a manner to guarantee reasonable safeguards to such confidentiality. Article 16. INTERNAL SERVICES PROVIDED BY ADMINISTRATOR No internal services shall be provided for a fee without the express written permission of the City. Article 17. EXTERNAL PROVIDER /VENDOR SERVICES All services provided by external providers /vendors shall be approved by the City and billed at actual cost with no "mark -up" by the Administrator. All external providers /vendors will be selected from a panel approved by the City. Prior to establishment of the approved panel, the administrator will provide the City with a listing of all proposed providers /vendors. The list shall include the fee charged by each provider /vendor. 7 of 17 Article 18. DOCUMENTS /CORRESPONDENCE The City will designate documents /correspondence they will require for their files and a timeframe for receipt of such documents /correspondence. Article 19. MATERIAL PROBLEMS AND REGULATORY CHANGES The Administrator will advise the City on any material problems or need for improvements in any matter related to this Agreement, including advice relating to changes and proposed changes in statutes, regulations and rules affecting the City's workers' compensation programs. Article 20. NOTICES All notices required or permitted hereunder shall be personally delivered or dispatched by first class mail and sent to the other party at the following addresses, or at such other address as may be provided in writing to the other party from time to time: To Administrator: Alithia Vargas - Flores AdminSure Inc. 1470 S. Valley Vista Drive Suite 230 Diamond Bar, CA 91765 To CITY: Hue Quach Administrative Services Director City of Arcadia 240 W. Huntington Drive Arcadia, CA 91007 Article 21. DWC AUDIT PENALTY All penalties assessed by the Workers' Compensation Division, Office of Benefit Assistance and Enforcement shall be paid, whether directly or through reimbursement, by the party responsible for the assessment of the penalty. No claim shall be settled to include payment of any penalty without the express written consent of the City. Settlement of any penalty incurs an additional settlement cost and the responsible party shall pay the additional cost for the penalty. If either party disputes the liability for payment of the penalty, the parties shall negotiate to resolve the dispute. If the dispute is not resolved within 30 days after notice to both parties of the penalty, then such dispute shall be submitted to arbitration for determination of the party responsible for the assessment and payment of the penalty. The provisions of this Article shall survive any termination of this Agreement. 8of17 The Administrator shall provide a detailed monthly listing of penalties identifying those payable by the City and those payable by the Administrator. The listing shall include fines, penalties and 10% self- imposed increases paid through settlement of a claim. The obligations of the Administrator to pay for fines, penalties, and 10% self- imposed increases shall survive the termination of this Agreement. Article 22. MMSEA Reportin The Administrator shall report all claims in compliance with Medicare, Medicaid and SCHIP Extension Act ( MMSEA) Section 111 Mandatory Reporting. Article 23. ASSIGNED PERSONNEL Each dedicated claims adjuster assigned to the City will not have a case load that exceeds 150 for all claims combined (including indemnity, medical only, future medical, record only or any other type of claim). The claims adjusters will not handle claims for any other account. Designated claims assistants and medical only clerks will be assigned. If the caseload of a claims adjuster exceeds 150 claim files for two consecutive months, the City will have the discretion of allowing the excess, or will have the Administrator assign an additional non - dedicated claims adjuster to handle the overflow claims. The claims adjusters will have a valid California Self- Insured Administrator Certificate, unless mutually agreed to otherwise by the parties. The City will maintain final approval in the selection of staff assigned to their account and the right to request new staff if the service is unacceptable to the City for any reason. The claims adjusters assigned to the account must have a minimum of five years full - time experience as a workers' compensation claims adjuster in California, and have a California Self- Insured Workers' Compensation Certificate unless otherwise agreed to in writing by the City. Article 24. FUNDS The City may provide Administrator initial funding in an amount mutually agreed to by the City and Administrator to be held in trust by, and used by Administrator to meet the obligations of the City. Administrator and the City may establish written procedures for approval or ratification of expenditures from such trust accounts and methods of handling such funds; in such event Administrator shall provide a copy of the written procedures to the City. Trust funds shall be used and paid out by Administrator only in the manner set forth in this Agreement. Article 25. WAIVER The failure of either party at any time to enforce any right or remedy available to it under this contract with respect to any breach or failure by the other party shall not be constructed to be a waiver of such right or remedy. 9of17 Article 25. MISCELLANEOUS This Agreement shall be governed by, and construed in accordance with, the laws of the State of California. In the event that any of the provisions of this Agreement shall be held by a court or other tribunal of competent jurisdiction to be unenforceable, the remaining portions of this Agreement shall remain in full force and effect. All terms and conditions of the Administrator's proposals of August 4, 2008 are incorporated into this contract, except that in the event of any conflict between the Agreement and the proposal, this Agreement shall be controlling. Any modifications of this Agreement must be in writing and signed by both parties. The City herein shall be a third party beneficiary of this Agreement with the right to enforce the provisions of this Agreement against Administrator. In witness whereof the parties hereto have signed this Agreement as of the date set forth in Article 1. CITY: City of Arcadia rrrin�Cazza rett City Manager Date: �w6us f 14, Zo i Q- ATTEST: Cityi�Cler ADMINISTRATOR: AdminSure, Inc. Authorized Signat e #11�&&,, Print Name � � 1 //1 �3 Title Date: �l 10 of 17 APPROVED AS TO FORM-, Stephen P. Deitsch City Attorney ADDENDUM1 MINIMUM PERFORMANCE STANDARDS THIRD PARTY ADMINISTRATOR Minimum performance standards are listed below and will be incorporated as a part of the Agreement between the City of Arcadia (CITY) and the selected third party administrator (TPA). Modifications to the Minimum Performance Standards may be made by the City. All staff assigned to the account must read and sign that they acknowledge receipt and will adhere to the Minimum Performance Standards. (1) PROCESSING (A) All Employers' Reports of Occupational Injury or Illness, or notification of a new claim from any other source, will be reviewed for compensability and a decision made to accept, delay or deny within seven days of receipt, or sooner if a delay in payment or notice will result. (B) Employees will be contacted by telephone or in person within two business days of receipt of a claim by the examiner unless the employee is represented by an attorney. During this initial contact, employees will be provided with an explanation of their benefits, and will be asked whether they have any questions or concerns. These will be addressed immediately. A benefit pamphlet will be sent to the employee notifying them of their rights under workers' compensation laws of California. Contact will be made sooner if delay will result in a late payment or a penalty situation. (C) Within two business days of receipt of any death claim or injury requiring hospitalization, the TPA staff will meet with the employee and /or their family to explain benefits. The City will be contacted for authorization to contact. (D) The injured or ill employee will be contacted at least every two weeks while they are disabled from working, unless they are represented by an attorney or their claim has been finalized. (E) The City will be contacted within three days of receipt of a claim to verify continuing disability, clarify issues and request additional required information. Contact will be made sooner if delay will result in a late payment or a penalty situation. (F) Employer contact is required to verify continuing disability and explore the availability of modified or light duty before processing disability payments. 11 of 17 (G) The employee's treating doctor will be contacted within three days of receipt of claim to verify duration of disability, compensability, proposed treatment, clarify issues and request additional information. Contact will be made sooner if a delay will result in a late payment or penalty situation. Thereafter, the TPA will maintain contact, at least every 30 days with the attending physician, obtaining medical reports, reviewing and monitoring medical treatment progress and facilitating an early return to work. (H) Claims will be created and entered in the computer within two business days of receipt of the Form 5020. (1) Telephone calls will be returned within 24 hours. If the TPA staff member called is not available within this time frame, another designated staff member will return the call. (J) All written communications requiring acknowledgment or action by a claims administrator will be responded to and mailed within ten days or sooner if an immediate response is required. (K) Accurate and timely benefits will be paid to employees as required by State statutes. (L) Accurate and timely benefit notices will be sent in accordance with Title 8, California Code of Regulations. (M) Lost -time claims, with the exception of future medicals, will be reviewed on diary every 30- calendar days or more frequently where needed. (N) Medical -only claims will be reviewed every 30 days for possible closure. They will be transferred to an indemnity claim when disability is due, compensability is an issue, they are over 90 days old or medical payments (excluding diagnostic expenses) exceed $1,500. (0) Indemnity claims will be reviewed by the appropriate supervisor no less frequently than at the following intervals: file creation, before cases are delayed and /or denied, when reserve increases exceed the examiner's limit of authority, proposed settlements or payments exceed the examiner's limit of authority, at AOE /COE and subrosa investigative referrals, at medical case management referrals, upon defense counsel referrals, 15 calendar days before mandatory settlement conferences and 15 calendar days before scheduled trials. (P) Subrogation possibilities will be identified and appropriate steps taken to investigate within five days after a claim is opened, or within five days after information is available that subrogation may exist. 12 of 17 (Q) All medical, legal, rehabilitation, investigation and other service provider invoices will be reviewed before payment regarding causal relationship to injury and if services billed are for services requested. Invoices will be paid according to State allowable rates, or appropriateness, or for compliance with any agreements in place with the facility, or as agreed to when service was requested. Vendors providing service at an excessive rate, or billing for services that are not requested or required will be notified of the amount and reason for their reduction in payment. The City will be notified of any provider who continues to bill unreasonably for services. (1) FILE DOCUMENTATION (A) All files will have a "Plan of Action" identified including time frames for completing activity. Progress on the plan of action will be documented, as will the reasons for any delays or modifications to the plan and include all information that relates to the direction and value of the case. An active case strategy will be documented in the case until closure. (B) Delayed claims will clearly document the reasons for the delay; the information needed to determine compensability and the anticipated date of a final decision. In no case will the final decision be more than 85 days from the City's date of knowledge. Cases will be diaried every 14 days or sooner to monitor the investigation process. All delay in decision letters will be reviewed by the appropriate Supervisor before mailing. (C) All denied claims will document the factual, medical or legal basis for denial in accordance with State statutes. Denials will be made as soon as information is available that the claim should be denied. All denial letters will be reviewed by the appropriate supervisor before mailing. (D) All invoices from medical, legal, rehabilitation, investigation and other service providers will be reviewed for accuracy, appropriateness and relationship to injury. Vendors providing service at an excessive rate or billing for services that are not requested or required will be notified of the amount and reason for their reduction in payment. The City will be notified of any provider who continues to bill unreasonably. (E) All files will be in chronological order with correspondence in the designated section. All handwritten correspondence must be legible and any action taken on the file must identify who completed it. Notes and activity completed in the computer system must identify who completed the entry and dated. All actions must be documented in the computer file notes. 13 of 17 (F) All claim files will contain file contents as specified in Title 8, California Code of Regulations. (3) INVESTIGATIONS (4) (A) The City will be notified of all claims being delayed or denied before a Notice is sent to the employee. The City will also be notified before any questionable claim is accepted. (B) On questionable indemnity claims, investigative assignments will be made to outside vendors with prior authorization from the City. Referrals will include specific written instructions regarding the scope of the investigation. (C) In cases where claims investigations are being conducted, claims will be placed on diary every fourteen days until all outstanding issues are resolved. (D) Where medical causation is unclear, a qualified medical examination will be scheduled. All relevant medical records and investigative information will be provided to the physician for review before the date of examination. (E) An Index Bureau and Edex Request will be submitted on all new claims. Thereafter, requests will be submitted at least annually, or at appropriate intervals if the possibility of other injuries is suspected, and when requested by the City. (F) Investigators will be selected from a panel approved by the City. The TPA will evaluate and monitor the panel's performance. All concerns or recommendations for panel additions /deletions will be discussed with the City. MEDICAL MANAGEMENT (A) Employees who have not pre- designated a personal physician will be directed to panel medical providers. Panel medical providers will be selected and approved by the City. The TPA will evaluate and monitor the panel's performance. All concerns or recommendations for panel additions /deletions will be discussed with the City. (B) Medical treatment will be monitored to ensure that treatment is appropriate and related to the compensable injury or illness. Inappropriate medical reports will be objected to timely. 14 of 17 (5) (C) The employee will be called before sending notification of permanent disability and QME letter, to explain process and answer employee's questions. (D) The City will be notified within three days after knowledge that employee has been found permanent and stationary by the treating doctor. (E) Independent medical examinations by qualified physicians will be scheduled when needed to address necessity or reasonableness of care. A cover letter will be provided to the physician outlining the specific issues and concerns along with the examiner's questions. All medical /investigations reports will be sent to the physician prior to the examination. (F) Preexisting medical conditions and medical records will be explored /obtained on lost -time claims and as requested by the City. (G) Treatment recommendations for care such as physical therapy, chiropractic manipulations, etc., will be verified with the physician as to duration, frequency and anticipated results. (H) Claims referred for outside medical management services will reflect the intent and scope of services requested and must be authorized on a case - by -case basis by the City. The City will approve medical management firms and all other review firms. (1) On future medical claims, yearly medical reports will be obtained if the employee continues to receive medical treatment. (J) Medical bills submitted without a supporting medical report will not be paid until a medical report is obtained. Medical bills will be paid /denied /objected to in accordance with state statutes, and paid in accordance with the fee schedule or negotiated rate. (K) Medical -legal costs will be reviewed for appropriateness and necessity. Bills which do not qualify as valid medical -legal expense will be objected to on a timely basis according to the Labor Code. SUPPLEMENTAL JOB DISPLACEMENT /REHABILITATION MANAGEMENT (A) For injuries on or after January 1, 2004, the Administrator shall coordinate with the City to offer modified or alternate work within 25 days of the last payment of temporary disability. 15 of 17 (6) (B) For injuries on or after January 1, 2004, employees not returning to work shall be provided a supplemental job displacement benefit in accordance with regulations, including the issuance of timely notices. (C) For injuries prior to January 1, 2004, all necessary reports to the Rehabilitation Unit will be completed and filed within the time frames specified by the Labor Code. All rehabilitation programs will be monitored on an ongoing basis to verify progress and appropriateness. Copies of vocational rehabilitation plans will be sent to CIPA. LITIGATION MANAGEMENT (A) The examiner will retain primary responsibility on all claims referred to defense counsel. Defense counsel will not be used to perform routine activities that should be the responsibility of the examiner. Some examples of routine tasks include: setting medical examinations, preparing medical cover letters, filing and serving medical reports, lien negotiations, arranging for photocopying, investigators or other outside vendors. Exceptions will be approved by the City. (B) Legal counsel will be selected from a panel approved by the City. The TPA will evaluate and monitor the panel's performance. Legal counsel will be reviewed for their ability to identify issues, aggressiveness in resolving claims, responsiveness, timeliness, and billing practices. All concerns or recommendations for panel additions /deletions will be discussed with the City. (C) Claims sent to defense counsel will be accompanied by a transmittal letter outlining the status of the case, results of investigations, primary issues, requested action, a complete copy of the file, and any documentation. Ongoing documentation will be timely sent to defense counsel. (D) At the close of discovery on cases going to trial, the file will have been adequately prepared to include necessary depositions, medical examinations and witness identification and contact information. (E) Settlement worksheets will be prepared and submitted to the City for approval on all settlements when requested. Overpayments will be identified on any settlement request. (F) Legal counsel will be monitored for adherence to CIPA's Litigation Management Guidelines. 16 of 17 (7) RESERVING (A) Reserves established on indemnity claims will reflect the ultimate probable cost of each claim based on the information developed to date. Reserve worksheets will be used to document all reserve changes and reflect amounts allocated to temporary disability, permanent disability, and vocational rehabilitation (if applicable), medical care and allocated expense. The injured workers' disability, age and occupation will be considered in estimating permanent disability. (B) Reserves will be evaluated and modified upon receipt of new information, and no less frequently than every 90 days on indemnity claims that have not been finalized. Reserves on claims finalized will be evaluated at least annually. (C) Payments and reserves will not be lumped on one claim when a claimant has multiple claims, including continuous trauma claims. Files will accurately reflect the payments and reserves related to the exposure on each separate claim. (8) EXCESS INSURANCE REPORTIN (A) The TPA will report to the excess insurance carrier(s), including CIPA, in accordance with established procedures. 17 of 17