Resolution No. 92022
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RESOLUTION NO. 9202
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A
LETTER OF UNDERSTANDING AMENDING AGREEMENT WITH
UNITED OF OMAHA LIFE INSURANCE COMPANY REGARDING
PLAN COVERAGE FOR EMPLOYEE
WHEREAS, the City of Vernon has agreements with United of
Omaha Life Insurance Company ("Omaha") for administering the City's
employee health care plan; and
WHEREAS, on August 22, 1989, the City Council of the City of
Vernon adopted Resolution No. 5657 approving an Administrative
Services Agreement with United of Omaha Life Insurance Company
("Omaha") that was effective September 1, 1989 (the "Agreement"); and
WHEREAS, Omaha denied the claims of Dr. Megan L. Sarnecki
and Providence Seward Medical Center for services rendered to Steven
Ruffoni concerning emergency treatment at out -of -network providers
while on vacation (Claim Nos. 061940294400 and 062011040601); and
WHEREAS, Omaha based its denial of the claims upon a
determination that in -network benefits were not allowed for out -of -
network providers under the Agreement; and
WHEREAS, the difference in the in -network benefits versus
the out -of -network benefits is approximately $261.60; and
WHEREAS, under the terms of the Agreement, the City makes
all final decisions on plan claims; and
WHEREAS, the Acting Risk Manager reviewed the appeal of
Steven Ruffoni and suggests that the City allow the one time only
claim of approximately $261.60 based upon the fact that Mr. Ruffoni
was provided emergency services at the nearest hospital; and
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WHEREAS, in accordance with the direction of the Finance
(Committee Section of the City Council on November 22, 2006, the Acting
Risk Manager executed an ASO Appeal Review Request dated October 31,
2006, subject to the City Council's approval of a Letter of
Understanding; and
WHEREAS, Omaha has requested that the City sign a Letter of
Understanding to allow in -network benefits for emergency services
rendered to Mr. Ruffoni with the understanding that any benefit
allowed pursuant to the Letter of Understanding will not apply under
the specific and aggregate stop loss provisions under policy G0002R05.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the recitals contained hereinabove are true
and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the Letter of Understanding with United of Omaha Life
Insurance Company, a copy of which is attached hereto as Exhibit A and
incorporated herein by reference.
SECTION 3 The City Council of the City of Vernon hereby
authorizes the Acting Risk Manager to execute said Letter of
Understanding for, and in behalf of, the City of Vernon.
SECTION 4 The City Council of the City of Vernon hereby
directs the Acting Risk Manager to send one fully executed Letter of
Understanding to Omaha.
1 SECTION 5: The Acting City Clerk of the City of Vernon
2 shall certify to the passage of this resolution, and thereupon and
3 thereafter the same shall be in full force and effect.
4 APPROVED AND ADOPTED this 3rd day of January, 2007.
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7 THOMAS A. YBA , Mayor Pro-Tem
8 ATTEST:
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11 BRUCE V. MALKENHORST, JR.
Acting City Clerk
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1 STATE OF CALIFORNIA )
2 ) ss
COUNTY OF LOS ANGELES )
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4 I, BRUCE V. MALKENHORST, JR., Acting City Clerk of the City of
5 Vernon, do hereby certify that the foregoing Resolution, being
6 Resolution No. 9202, was duly adopted by the City Council of the City
7 of Vernon at a regular meeting of the City Council duly held on
8 Wednesday, January 3, 2007, and thereafter was duly signed by the Mayor
9 Pro-Tem of the City of Vernon.
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BRUCE V. MALKENHORST, JR.
12 Acting City Clerk
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(SEAL)
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EXHIBIT
A
G14., ai'..•,tnl IIc.tII i, t`.,,',r 11":( '1 (VI
Itt J. Gst� u
Decernber 11. 2006
R E C E I tua��C)matta
'06 DEC 18 All :01
Cil Y +ir
RISK MAhIt;i3Or1ENT
City of Vernon
Attn: Cindy Calzada
Santa Ave
VernORIGINAL
Vernon,on.n, CA t35004-2202
Re. Plan Cuverage for Steven Ruffoni
Dear Ms. Calzada:
This letter serves as an amendment to the Administrative Services .Agreement of September 1. 1989.
between United of Omaha Life Insurance Company ("Company") and City of Vernon (the
"Agreement"). The terms of this letter are made a part of the Agreement and are subject to all
provisions of the Agreement not in conflict with the provisions of this letter.
City of Vernon and Company agree as follows
I . Company shall, as an exception to the terms of City of Vernon's self -funded group health plan
(Group Plan G0002R05), agree to allow in -network benefit coverage for the services rendered in
claim 061940294400 and 062011040601. Emergency room services were rendered on July 9.
2006. by emergency room physician Megan L. Sarnecki at Providence Seward Medical Center for
member Steven Ruffoni. The City of Vernon feels that since services were provided on an
emergency basis, and the fact that the patient utilized the nearest facility, that in -network benefits
are warranted. Services will be processed per the in -network level of benefits sr.rbject to the usual
and customary allowance. The member will remain liabie for any amount over the usual and
customary. City of Vernon agrees that benefits paid pursuant to this letter approximately
$261.60. will not apply under the specific and aggregate stop loss provisions under policy
(30002R05
Notwithstanding anything to the contrary in the Agreement. City of Vernon agrees that it shall
indemnify, defend and hold Company harmless from any liability. loss, costs, expenses or
darnages (including: without limitation, attorneys' fees, court costs and extra -contractual and
punitive damages) incurred by Company arising out of or resulting from this letter or any act or
omission of Company in the performance of its duties under this letter. This obligation to
indemnify, defend and hold Company harmless shall be in addition to, and shall not replace. any
other obligation of Employer in the Agreement to indernify, defend and hold Company harmless.
_ . Company assumes no responsibility for any tax or legal consequences that City of Vernon, the
plan sponsor or any person covered under City of Vernon's plan may incur under any state or
federal law as a result of this letter.
t. Company and City of Vernon acknowledge and agree that Company only provides ministerial
claims processing services for City of Vernon's self -funded group health plan and that Company
has no authority to act, and does not act, as a fiduciary for the plan in any manner whatsoever.
5. The terms of this letter shall be read together and construed as one document with the
Agreement, but to the extent of any inconsistency or ambiguity, this letter shall govern.
6. Except as expressly provided in this letter, all of the provisions of the Agreement shall remain in
full force and effect.
7. Where the provisions of this letter and those of the group health plan conflict, the provisions of
this letter will apply.
8. The terms of this letter may be modified or amended only by an instrument in writing, duly
executed and delivered by the parties hereto.
9. Any number of counterparts of this letter may be executed and each such executed counterpart
shall be deemed an original.
Cory Michel
Vice President, Underwriting
Date: 12. —1 7, - 0(o_
AGREED TO and ACCEPTED FOR:
By:
Title:
Date:
cc: Gallagher Benefit Services, Inc.
Southern California Group Office
Group Premium Administration
Group Claims
Contract Side of Master Contract File