Resolution No. 93051
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^yp .
RESOLUTION NO. 9305
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND RATIFYING THE EXECUTION OF A
2007 AMENDMENT TO ADMINISTRATIVE SERVICES AGREEMENT
BY AND BETWEEN THE CITY OF VERNON AND UNITED OF
OMAHA LIFE INSURANCE COMPANY
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 January 3, 2007, the City Council of the City of
Vernon approved the renewal package for medical/dental/life insurance
renewals from Omaha-PPO Program for policy year January 1, 2007 to
January 1, 2008 (the "Renewals"); and
WHEREAS, in order to meet the urgent need to facilitate the
Renewals, the Chief Deputy City Attorney/Acting Risk Manager signed
the 'Amendment to the Administrative Services Agreement with Omaha on
March 13, 2007, subject to ratification by the City Council; and
WHEREAS, by memo dated April 23, 2007, the Chief Deputy City
Attorney/Acting Risk Manager recommended that the City approve and
ratify his execution of the Amendment to the Administrative Services
Agreement to implement the renewal of the group policies for 2007; and
WHEREAS, the City Council of the City of Vernon has
determined that, pursuant to the provisions of subsection (a) of
Section 2.27 of the Vernon City Code, it is in the public interest and
necessity to enter into the Amendment to the Administrative Services
Agreement with Omaha, to enhance services provided to the Vernon
community.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
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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 and ratifies the execution of the 2007 Amendment to
Administrative Services Agreement (G0002R05) with United of Omaha Life
Insurance Company by the Chief Deputy City Attorney/Acting Risk
Manager on March 13, 2007, a copy of which is attached hereto as
Exhibit A and incorporated herein by reference.
SECTION 3: The City Clerk of the City of Vernon shall
certify to the passage of this resolution, and thereupon and
thereafter the same shall be in full force and effect.
APPROVED AND ADOPTED this 7th day of May, 2007.
"EST:
RI, AIRTM
N
,(City Clerk
- 2 -
1 STATE OF CALIFORNIA )
2 ) ss
COUNTY OF LOS ANGELES )
3
4 I, MANUELA GIRON, City Clerk of the City of Vernon, do hereby
5 certify that the foregoing Resolution, being Resolution No. 9305, was
6 duly adopted by the City Council of the City of Vernon at a regular
7 meeting of the City Council duly held on Monday, May 7, 2007, and
8 thereafter was duly signed by the Mayor or Mayor Pro-Tem of the City of
9 Vernon.
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11 Xv�
ANUELA G ON, ity Clerk
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13 (SEAL)
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3 _
EXHIBIT
0
AMENDMENTTO
ADMINISTRATIVE SERVICES AGREEMENT
(G0002R05)
Effective January 1, 2007, this Amendment to the Administrative Services Agreement of January 1, 2006, between
City of Vernon (Contractholder) and United of Omaha Life Insurance Company (Company) is made a part of such
Agreement and is subject to the provisions of the Agreement not in conflict with the provisions of this Amendment.
Employer and the Company mutually agree that the following provision 1 of Exhibit 3 is deleted and the
following is substituted:
EXHIBIT 3 — COMPENSATION AND PAYMENTS
1. Administration Fees. Contractholder shall pay Company by the end of the month following receipt of
Company's monthly billing statement a monthly administration fee equal to:
(a) the following total fee(s) for each Subscriber and each COBRA qualified beneficiary billing address
each month covered under the medical plan during the periods stated below, made up of the
following subfees:
(i) Class Description: All Subscribers and COBRA qualified beneficiary billing
addresses:
PlanPeriod.............................................................................................
1 /1l2007
to
11112008
Claims Administration and access to the Medical Specialty Network
$43.95
Care Network access other than Medical Specialty Network access)
$3.26
-Managed
Medical Management Services (other than Case Management Services, including
Pregnancy
$2.73
-Healthy
Case Management Services (including Healthy Pregnancy)
$0.85
Disease Management Program
N/A
-Employee Assistance Program (EAP)
N/A
Nurse Support Services
NIA
HIPAA Administration Services
NIA
COBRA Billing and Collection Services
N/A
TOTAL FEE CHARGED
$50.79
This Amendment has been duly executed by the parties as of the dates set forth below.
City of Vernon
By:
CHIEF DEPUTY CI AT ORACTING RISK MA i�
Title
MARCH 13, 2007
Date
UNITED OF OMAHA LIFE
INSURANCE COMPANY
By:�.
Vice President
Health Risk Management
Title
Date
a
SELF -FUNDED CONDITIONS
Employer Name: City of Vernon
Plan Number: G0002R05
Renewal Effective Date January 1, 2007
The following are the terms of your [12]-month renewal:
Net Medical ASO Fee All Classes
214
$
42.73
Network Access Fee All Classes
214
$
3.09
Inpatient & Outpatient All Classes
214
$
2.55
Medical Management
Services Fee
Case Management All Classes
214
Included in
Services Fee
Above Fee
TOTAL COMBINED BILLABLE FEE ..................................................... 1 $ 48.37
SPECIFIC STOP LOSS:
Specific Stop Loss
Aggregated Specific Stop Loss Level
Applicable Classes
Contract Basis
Applicable Coverages
Maximum Individual Reimbursement Limit While Insured
Accelerated Reimbursement Rider
Terminal Extension Rider
SPECIFIC STOP LOSS PREMIUM RATES
Employee 61
Employee/Spouse/Child(ren) 153
Monthly Total 214
$ 200,000
None
All Classes
12/12 Paid
Medical &
Prescription
Drug
$ 2,800,000
None
None
$ 20.07
$ 60.50
$ 10,480.77
12e►iewal Fees
$ 43.95
$ 3.26
$ 2.73
$ 0.85
Is 50.79 1 5.00%
$ 200,000
None
All Classes
12/12 Paid
Medical &
Prescription
Drug
$ 2,800,000
None
$ 28.89
$ 67.26
$ 12,053.07 15.00%
'The term "Employee" also includes COBRA qualified beneficiary billing addresses.
SELF -FUNDED RENEWAL TERMS AND CONDITIONS
#S
MI
["I
Current
AGGREGATE STOP LOSS:
Aggregate Stop Loss Percentage
125%
Applicable Classes
All Classes
Contract Basis
12/12 Paid
Maximum Annual Aggregate Reimbursement Limit
$ 1,000,000
Applicable Coverages
Medical &
Prescription
Drug
Accelerated Reimbursement Rider
None
Monthly Accommodations Rider
None
Terminal Extension Rider
None
AGGREGATE STOP LOSS PREMIUM RATES
Employee
61
$ 6.69
Employee/Spouse/Child(ren)
153
$ 6.69
214
$ 1,431.66
AGGREGATE DEDUCTIBLE FACTORS
Renewal
125%
All Classes
12/12 Paid
$ 1,000,000
Medical &
Prescription
Drug
None
None
None
$ 8.03
$ 8.03
$ 1,718.42
['ove—re or
Renewal Plan
Plan 1 = $500 Deductible PPO Period
Employee $ 499.61 61 $ 579.54
Employee/Spouse/Child(ren) $ 1,108.13 153 $ 1,285.43
$ 200,020.10 214 $ 232,022.73
COMBINED MINIMUM MONTHLY AGGREGATE DEDUCTIBLE ................ 1 $ 200,020.10 $ 232,022.73
Life/AD&D renewal effective January 1, 2007 and will be guaranteed for the 24 month period of January 1, 2007 through December 31, 2008.
Rates are net of commissions Basic Life Insurance - $135 per $1,000
Basic AD&D Insurance - $0.04 per $1,000
Dependent Life Insurance - $0.34 per dependent unit
Please refer to the following pages for additional terms of your renewal.
20.03%
16.00%
'The term "Employee" also includes COBRA qualified beneficiary billing addresses.
RENEWAL TERMS AND CONDITIONS
Other Conditions of Renewal
The minimum monthly aggregate deductible is the smallest possible liability for a month during the Benefit Period for losses under the plan. The
monthly aggregate deductible will be the greater of:
(a) the minimum monthly aggregate deductible listed on the previous page, or
(b) the aggregate deductible factor multiplied by the corresponding number of Covered Subscribers under the plan for a given month.
Please note that the final minimum monthly aggregate deductible factor will be based on the actual enrollment in the plan on the renewal
effective date.
The specific and aggregate stop loss renewal policy will apply to claims paid on or after 12:01 a.m. on January 1, 2007 and before 12:01a.m. on
January 1, 2008.
i ne rouowing proceaures nave peen removea rrom me uupauent aurgicai rroceaures list:
* Knee arthroscopy
* Tympanostomy tube insertion
The following procedure has been added to the Outpatient Surgical Procedures list:
* Septoplasty
The following change applies to outpatient mental health /chemical dependency review:
* Review requirement has changed from the 3rd therapy visit to the 1st therapy visit (excludes initial evaluation)
The following services have been added to the Outpatient Precertification list:
* Selected High End Radiology services
* Specialty Pharmacy Drugs & Medicines
With your Stop Loss plan, you are eligible for Electronic Fund Transfer (EFT) for stop loss reimbursements. With EFT, stop loss
reimbursements can be electronically transferred to your "Home Bank Account". An e-mail notification would be generated each time an
electronic fund transfer occurs. EFT results in quicker turnaround time for receipt of your reimbursements when compared to receipt through
regular mail. There is no additional cost for the Electronic Fund Transfer method. Please initial the EFT provision below if you wish to add this
to your renewal stop loss plan:
Add Electronic Fund Transfer (EFT) to our Stop Loss plan
The ASO renewal fees assume all pharmaceutical rebates will now be retained by Mutual of Omaha. Your ASO fee has been credited
accordingly for this rebate change and your ASO agreement will be amended.
Your renewal requires the execution of the attached updated ASO Agreement. This agreement contains updated provisions for your benefit plan
and will supercede the current ASO Agreement.
The fees and conditions included within this Renewal Terms & Conditions document are based on the renewal enrollment shown on the fee
pages. If, at any time during the renewal plan period, overall enrollment or dependent content increases or decreases +/-10% from the renewal
enrollment stated within this document, we reserve the right to rerate the plan after 30 days notice.
Mutual of Omaha has arranged for pharmacy benefit management services to be provided by Express Scripts, Inc. (ESI). As compensation for
such services, we shall retain a fee of 5% of the monthly pharmacy benefit savings, if any, achieved through the performance of pharmacy
benefit management services. Savings shall be equal to the difference between:
(a) the average wholesale price of a particular drug or supply dispensed by a pharmacy as determined in accordance with our contract with
ESI, and
(b) the Discounted Charge for the same drug or supply determinbed in accordance with our contract with ESI:
We shall withdraw the amount of the fee from the Plan Benefit Account each month for savings achieved during the previous month.
RENEWAL
TERMS
AND
CONDITIONS
Other
Conditions
Renewal
of
On the effective date specified within this Renewal Terms document, we are amending the printing charge provisions of your Plan. As payment
for any future printed copies of the Plan benefit booklet, we will require a fee of $4.00 per booklet, which will be billed via invoice. Mutual will
continue to develop and maintain the Plan benefit booklet file and will provide it to you electronically, if requested.
Mutual shall also develop and print standard identification cards at no additional charge. If modifications to our format are desired, an additional
charge may apply.
In order to provide continuous, uninterrupted benefit payment services in accordance with your Plan provisions, this Renewal Terms
& Conditions form must be signed prior to the renewal date shown on the first page of this document.
City of Vernon
B A - I
I 9"',e -
CHIEF DEPUTY TY A EY
ACTING RISK ER
Title
MARCH 13, 2007
Date
UNITED OF OMAHA LIFE
INSURANCE COMPANY
By: t
Vice President - Health Risk Management
Title
0 7
Date
UNITED Of OMAHA LIFE INSURANCE COMPANY
Home Office: Mutual of Omaha Plaza, Omaha, Nebraska 68175
A Stock Company
(herein called Company)
has issued this Policy to City of Vernon
(herein called Policyholder)
This Policy is issued in consideration of the terms, conditions and limitations of this Policy.
This Policy is effective January 1, 2007, at 12:01 a.m., Standard Time, at the main office of the
Policyholder.
The Company agrees to reimburse the Policyholder for excess Eligible Losses, in accordance with the
terms, conditions and limitations of this Policy.
This Policy is issued in and is subject to California law.
I,,, KATM= Nil
5654GM-A-U-EZ 03
UNITED OF OMAHA LIFE INSURANCE COMPANY
Chairman of the Board 4nd Chief Executive Officer
POLICY NO. UP-2R05
(herein called Policy)
Corporate Secretary
VIE
REAPR 1 0 2007
CITY ATTORNEY DEPT.
RISK MANAGEMENT DEPT.
ASO
wo subro
SCHEDULE OF INSURANCE
This Schedule of Insurance is incorporated into and is made a part of this Policy. Insurance coverage
herein applies only during the Policy period specified, except that the Maximum Specific
Reimbursement applies to reimbursements made during the Policy period specified in the Schedule of
Insurance and any prior Policy period. Except as otherwise described in this Policy, the coverage herein
follows the benefit exclusions and provisions in the Plan.
Terms shown in the Schedule of Insurance will be used throughout the Policy and will have the value or
meaning shown herein.
1. POLICY PERIOD: Begins January 1, 2007 and ends December 31, 2007
2. COVERED UNITS:
(a) Your eligible retired employees;
(b) COBRA, FMLA, USERRA and other continuees described in the Plan document; or
(c) Your full-time eligible employees described in the Plan document.
3. SPECIFIC STOP LOSS INSURANCE
(a) Specific Deductible: $200,000
(b) Specific Reimbursement Percentage: 100%
(c) Maximum Specific Reimbursement: $1,800,000
(d) Specific Benefit. Period:
Plan benefits Paid from January 1, 2007 to January 1, 2008.
(e) Specific Stop Loss Insurance provides reimbursement for Eligible Losses for Medical Expenses.
(f) Specific Monthly Premium Rates:
Covered unit ..................................... ..............$28.89
.........................................................................
Covered unit and one (1) or more dependents........................................................................$67.26
4. AGGREGATE STOP LOSS INSURANCE
(a) Monthly Aggregate Deductible Factor:
Coveredunit................................................................................... .......................................$579.54
Covered unit and one (1) or more dependents.........................:.........................................$1,285.43
(b) Minimum Monthly Aggregate Deductible: The sum of the Monthly Aggregate Deductible
factors applicable to each Covered Unit under the Plan during the first month of this Policy,
$232,023.32.
(c) Aggregate Reimbursement Percentage: 1001/o
(d) Maximum Annual Aggregate Reimbursement: $1,000,000
(e) Aggregate Stop Loss Insurance provides reimbursement for Eligible Losses for Medical
Expenses.
(f) Aggregate Benefit Period:
Plan benefits Paid from January 1, 2007 to January 1, 2008.
(g) Aggregate Monthly Premium Rates:
Covered unit with or without dependents.................................................................................$8.03
5. SPECIAL UNDERWRITING TERMS: The following special underwriting terms apply to all
provisions of the Policy, including any Riders:
Not Applicable
DEFINITIONS
ELIGIBLE PARTICIPANT means any individual covered under the Plan, except as otherwise noted
in the Special Underwriting Terms in the Schedule of Insurance.
ELIGIBLE LOSS means a Loss that shall be considered toward the satisfaction of deductibles and/or
subject to reimbursement under this Policy. Eligible loss does not, however, include any Loss described
in the Exclusions provision.
EXPENSE means the charge incurred by an Eligible Participant for a service or supply which has been
ordered, prescribed or rendered by a dentist, physician or hospital. An expense is considered incurred
on the date the service or supply is received.
LOSS means an amount Paid by You or the Plan:
(a) for Plan benefits for Expenses;
(b) in settlement of claims for benefits under the Plan; or
(c) in satisfaction of judgments for benefits under the Plan.
OUR, WE, US means the Company shown on the face page of this Policy.
PAY, PAID, PAYMENT means a draft/check for Plan benefits has been issued.
PERFORMING NORMAL ACTIVITIES means physically or mentally able to perform all of the
usual and customary duties and activities of a person of the same age and sex, who is in good health. An
individual is not performing normal activities if he/she is:
(a) hospital confined;
(b) confined to an institution;
(c) confined to a facility other than a hospital;
(d) confined at home; or
(e) confined elsewhere due to an injury or sickness.
PLAN means Your self -insured health care plan for the benefit of Eligible Participants.
RIDER means a document that is added to and made a part of the Policy. A rider amends, limits,
restricts or otherwise changes the provisions of the Policy.
YOU, YOUR means the Policyholder shown on the face page of this Policy.
BENEFIT DEFINITIONS
Aggregate Reimbursement Percentage means the percentage of Eligible Losses in excess of the
Annual Aggregate Deductible that We agree to reimburse You, subject to the terms and conditions of
the Policy.
Annual Aggregate Deductible means an amount equal to the greater of
(a) Your minimum annual aggregate deductible; or
(b) the sum of Your Monthly Aggregate Deductible factors applicable to each covered unit under the
Plan for each month of the Policy period.
Experimental Service or Supply means a drug, device, treatment or procedure which:
(a) cannot be lawfully marketed without approval of the U.S. Food and Drug Administration and
which has not been so approved for marketing at the time the drug, device, treatment or
procedure is furnished;
(b) was reviewed and approved (or which is required by federal law to be reviewed and approved)
by the treating facility's Institutional Review Board or other body serving a similar function or a
drug, device, treatment or procedure which is used with a patient informed consent document
which was reviewed and approved (or which is required by federal law to be reviewed and
approved) by the treating facility's Institutional Review Board or other body serving a similar
function;
(c) Reliable Evidence shows is the subject of on -going phase I, II or III clinical trials or is under
study to determine its maximum tolerated dose, its toxicity, its safety, its efficacy or its efficacy
as compared with a standard means of treatment or diagnosis; or
(d) the prevailing opinion among experts, as shown by Reliable Evidence, is that further studies or
clinical trials are necessary to determine its maximum tolerated dose, its toxicity, its safety, its
efficacy or its efficacy as compared with a standard means of treatment or diagnosis.
Reliable Evidence means published reports and articles in peer -reviewed medical and scientific
literature; the written protocol or protocols used by the treating facility or the protocols) of
another facility studying substantially the same drug, device, treatment or procedure; or the
patient informed consent document used by the treating facility or by another facility studying
substantially the same drug, device, treatment or procedure.
Maximum Annual Aggregate Reimbursement means Our maximum liability for aggregate stop loss
insurance reimbursement for the Policy period.
Maximum Specific Reimbursement means Our maximum liability for all specific stop loss insurance
reimbursements for Eligible Losses of a Covered Unit, including reimbursements made under this
Policy, or any prior stop loss insurance policy issued by Us.
Monthly Aggregate Deductible means an amount equal to the greater of:
(a) Your minimum monthly aggregate deductible; or
(b) the sum of Your monthly aggregate deductible factors applicable to each covered unit under the
plan on the first day of each month.
Specific Deductible means the amount of Your liability for Eligible Losses of each Eligible Participant
during a Policy period. The specific deductible applies separately to each Eligible Participant during a
Policy period.
Specific Reimbursement Percentage means the percentage of Eligible Losses in excess of the Specific
Deductible that We agree to reimburse You subject to the terms and conditions of the Policy.
EXCLUSIONS
Eligible Loss does not include any Loss:
(a) for an Expense for a service or supply which is not Medically Necessary;
(b) which exceeds the Maximum Allowable Amount for an Expense;
(c) for Experimental Services or Supplies;
(d) for body organ transplants;
(e) for mental and nervous disorder benefits;
(f) for alcohol/drug and substance abuse benefits;
(g) for any Expense which is not incurred during the benefit period described in the Schedule of
Insurance;
(h) for Plan benefits which are not Paid during the benefit period described in the Schedule of
Insurance,
(i) related to Eligible Participants that We require You to report on the Select Risk Questionnaire,
unless those Eligible Participants are approved in writing by Us;
0) which does not strictly comply with the terms and conditions of the Plan;
(k) which You may recover under any Plan coordination of benefits or non -duplication of benefits
provision,
(1) related to exemplary, extra -contractual, compensatory or punitive damages or liabilities,
including but not limited to those resulting from the Plan's, Your, or Your agent's, employee's or
representative's gross negligence, intentional wrongs, fraud, bad faith or strict liability;
(m) related to any settlement or litigation costs and expenses;
(n) related to the services of (or provided by) a third party administrator or other party, unless
approved in writing by Us;
(o) arising out of, or resulting as a consequence of, or related to declared or undeclared war, civil
war, warlike action, insurrection, rebellion, or usurped power, or any action taken by a military
force or government using military personnel to defend against any of these;
(p) resulting from nuclear accidents;
(q) which arises out of, or in the course of, any employment with any employer; or for which the
Eligible Participant receives any settlement from a workers' compensation carrier, or is entitled
to benefits under any workers' compensation or occupational disease law, employer's liability or
similar laws regardless of whether such coverage is in force;
(r) resulting from the commission of, or attempted commission of, a felony, or participation in a
riot,
(s) related to an Eligible Participant's detention or incarceration in a jail, penitentiary, correctional
facility or correctional hospital;
(t) related to an Eligible Participant's active duty or training in the Armed Forces, National Guard or
Reserves of any state or country;
(u) for Expenses for which You received a specific stop loss insurance reimbursement from Us for a
prior Policy period, but for which Plan benefits were not issued until this Policy period; or
(v) related to surcharges assessed by any governmental authority.
GENERAL PROVISIONS
AMENDMENTS TO THE PLAN - No Plan change will affect this Policy or Our rights or obligations
without Our written consent. Written notice of Plan changes must be sent to Our Home Office, at least
31 days prior to the effective date of the change. We will provide reimbursement under this Policy as if
the Plan has not been amended if such advance written notice is not received and the change is not
accepted in writing by one of Our officers. We will provide reimbursement under this Policy based
upon the amended Plan only after such notice is received by, and the change is accepted in writing by
one of Our officers.
AMENDMENTS TO THIS POLICY - Only one of Our officers may change this Policy. No change
will be valid unless made in writing and accepted in writing by Us. No agent has authority to change this
Policy or waive any of its provisions.
ASSIGNMENT - You may not assign this Policy or Your rights or obligations under this Policy.
CLERICAL ERROR - A clerical error will not invalidate insurance otherwise in effect; nor will it
continue insurance validly terminated. If an error is discovered, an equitable adjustment in premium will
be made. If a premium adjustment involves the return of unearned premium, the amount of the return
Will be limited to the unearned premium for the Policy period during which We receive proof such an
adjustment is necessary.
CONFORMITY WITH LAW - If, on the effective date of this Policy, any provision of this Policy
conflicts with any applicable law, then the provision will be deemed to conform to the minimum
requirements of the law.
INSURANCE CONTRACT - The entire contract between the parties shall consist of:
(a) this Policy;
(b) Your Select Risk Questionnaire;
(c) Your application for this Policy; and
(d) Riders added to this Policy that are approved by Us.
EXAMINATION OF RECORDS - Your books, records and procedures pertaining to the Plan or this
Policy (and those of all Your agents, employees and representatives) will be open to inspection by Our
employees and/or representatives during Your regular business hours.
HEADINGS - The headings of the various provisions of this Policy are inserted merely for convenience
and do not, expressly or by implication, limit, define or extend the terms of the provisions so designated.
LEGAL ACTIONS - No legal action to recover any reimbursement under this Policy may be brought
earlier than 60 days after the date written claim for reimbursement has been given to Us. No legal action
may be brought more than 3 years, or the date of any applicable state law, after the date any Expense has
been incurred for which reimbursements are claimed.
LIABILITY - We will have neither the right nor obligation under this Policy to directly pay any person
or provider of professional or medical services. Our sole liability is to You, subject to the terms and
conditions of this Policy. Nothing in this Policy shall be construed to permit anyone; other than You, to
have a direct right of action against Us. We will not be considered a party to Your Plan or to any
supplement or amendment to that Plan.
MISSTATED DATA - We have relied upon the information, including, without limitation, the Select
Risk Questionnaire and Your application, provided by You or Your agents, employees or
representatives, in the issuance of this Policy. If, before or after, making any reimbursement, We
determine that You or Your agent, employee or representative provided inaccurate information or
misstated, omitted, concealed or misrepresented any material fact or circumstance concerning this Policy
or the Plan, including any Loss or other items that You were required to disclose to Us on Your
application or the Select Risk Questionnaire, or there was fraud by You or Your agent, employee or
representative relating to this Policy, We may:
(a) deny stop loss reimbursements for Losses related to (or the adjustment of Specific Deductibles
for) certain individuals, notwithstanding any other provision of the Policy;
(b) revise the terms or conditions of the Policy, including, without limitation, the premium rates;
(c) rescind the stop loss insurance; or
(d) void the Policy.
PARTIES TO THIS POLICY - The parties to this Policy are You and Us. This Policy does not create:
(a) any right or legal relationship between Us and the Plan or between Us and any Eligible
Participant;
(b) any responsibility or obligation that We directly reimburse the Plan; or
(c) any responsibility or obligation that We directly reimburse any Eligible Participant, or any health
care provider for benefits provided under the Plan.
REIMBURSEMENT OF PLAN LOSSES - We shall have the sole authority under this Policy to
approve or deny reimbursement for any Loss. All reimbursements provided under this Policy will be
Paid to You.
NEW POLICY - At the end of the Policy period, but only by mutual written agreement between You
and Us, a new stop loss policy may be issued for another Policy period. The new policy may be subject
to new premium rates, new special underwriting terms, new benefit periods and other new terms and
conditions.
SEYERABILITY CLAUSE - If any clause in this Policy is deemed void, voidable, invalid, or
otherwise unenforceable, whether or not such a provision is contrary to public interest, voiding that
clause will not render any of the remaining provisions of this Policy invalid.
SET-OFF - We are authorized to set-off and apply any and all amounts due to You from Us under this
Policy to any and all obligations or indebtedness You may have to Us. This right of set-off does not
require Us to make any prior demand upon You and this right exists irrespective of whether Your
obligations are contingent or unmatured. Our rights under this provision are in addition to any other
rights and remedies which We may have under the Policy or otherwise.
DUTIES OF THE POLICYHOLDER
In addition to all other duties and obligations described in this Policy, the parties agree that You shall
have the duties and obligations described herein.
DEFENSE - You agree to defend any claim made, suit brought or proceeding instituted against You or
the Plan or relating to payment or non-payment of Plan benefits.
PROOF OF PLAN LOSS - You agree to maintain (and make available at all times) such information
as We may reasonably require to reimburse Eligible Losses.
PAYING AND FUNDING PLAN LOSSES - You agree to Pay all Losses within 15 days of receiving
adequate proof. If You fail to Pay any Losses within the 15 day time limit, We may:
(a) immediately terminate coverage under this Policy; and
(b) consider any Policy deductible unsatisfied.
REPAYMENT AND REFUND - You agree to repay Us for any voided Payments, refunds or other
recoveries received by You or the Plan if You previously received any stop loss insurance
reimbursements from Us for the Losses. You also agree to provide such repayments to Us within 45
days after You or the Plan:
(a) receives a refund or recovery; or
(b) voids any Payment.
The amount You must repay Us shall not exceed the amount of Our stop loss reimbursements. You also
agree to refund to Us or repay Us other amounts due to Us as described in any Riders or any other
provisions of the Policy. If You fail to repay or refund Us within 45 days, or within the time period
specified in any Rider or other provision of the Policy You will be liable for all expenses We incur,
including reasonable attorneys' fees, as a result of Our collection efforts.
We have preference over all other claimants for the repayment or refund of any amount due.
REPORTING COVERED UNITS - You agree to prepare and submit to Us by the 15th day of each
month, a report of the total number of covered units under the Plan during each month of the Policy
period.
Upon Our request, You shall also provide a report showing covered units by city, state, and ZIP code of
primary residence and any other pertinent data regarding Eligible Participants.
RECORDS - You agree to maintain records reasonably required by Us:
(a) during the term of this Policy; and
(b) for seven (7) years after termination of this Policy.
NOTIFICATION - You agree to immediately notify Us of Plan termination.
PLAN DOCUMENT - You agree to provide Us with a copy of Your Plan document describing Your
Plan's benefits.
PRIVACY OFFICER - You agree to designate a HIPAA privacy officer for the Plan.
USE OF GENERAL ASSETS - You agree to use only Your assets to fund premiums for this Policy.
Neither Plan assets nor employee contributions shall be used to fund these premiums.
PREMIUMS AND FACTORS
PAYMENT OF PREMIUMS - The first premium is due the first day of the Policy period. Subsequent
premium payments are due the first day of each month ("Premium Due Date") during the Policy period.
Payment should be made to Us at Our Home Office, unless one of Our officers authorizes payment to be
made somewhere else.
If this Policy terminates for any reason, You are liable for all premiums to the date of termination.
PREMIUM AMOUNT - The premium for the Policy will be calculated on the basis of premium rates
shown in the Schedule of Insurance. The amount of premium due each month will be equal to the sum
of the products obtained by multiplying each premium rate shown in the Schedule of Insurance.by the
corresponding number of covered units under the Plan for that premium rate category on the first day of
each month.
GRACE PERIOD - Except for the first premium payment, a grace period of 31 days from the premium
due date will be allowed for the payment of premiums. Coverage will automatically terminate on the
premium due date if premium has not been received by Us when the grace period ends.
PREMIUM RATES, DEDUCTIBLES AND FACTOR CHANGES - We may change premium razes,
deductible factors, or any Policy deductible on:
(a) the date the Plan or Policy is changed, including, but not limited to, any change that is required
by law,
(b) the date You add or eliminate a subsidiary, affiliated company or division; or
(c) the date that the number of covered units under the Plan increases or decreases more than 100/6
compared to the number of covered units under the Plan on the effective date of this Policy.
If We give at least 60 days advance written notice, We have the right to adjust premium rates when
premium taxes or other changes assessed by any governmental authority and payable by Us increases
(but only to the extent of the increase). If We do not adjust the premium rate, We may bill you directly
for charges assessed by any governmental authority and payable by Us. Amounts billed directly for
charges assessed by any governmental authority and payable by Us are due within 60 days of written
notice given by us.
Any submission of incorrect premium or number of covered units under the Plan during a Policy period
must be reported to Us no later than 60 days after the Policy period ends.
If, in addition to this Policy, You have any other insurance policy ("Insurance Policy"), group health
maintenance organization contract ("HMO Contract'), or administrative services agreement or other
type of service agreement ("Service Agreement") with Us or any affiliate of Ours, and an administration
fee or other payment described in a Service Agreement ("Fee") is not paid in full by the required due
date, or premium is not paid in full during the grace period for this Policy or an Insurance Policy or
HMO Contract, the total amount of premium and Fees paid for this Policy and each Insurance Policy,
HMO Contract and Service Agreement during the month in which the premium or Fee is not paid in full
("the Delinquent Month') will be allocated to this Policy and each Insurance Policy, HMO Contract or
Service Agreement on a pro-rata basis.
The amount of premium and Fees allocated to this Policy and each Insurance Policy, HMO Contract,
and Service Agreement will be determined by multiplying:
(a) the amount of premium due for this Policy and each Insurance Policy and HMO Contract during
the Delinquent Month and the amount of Fees due for each Service Agreement during the
Delinquent Month by:
(b) the percentage equal to:
(1) the total amount of premium and Fees paid for this Policy and each Insurance Policy, HMO
Contract, and Service Agreement during the Delinquent Month divided by;
(2) the total amount of premium and Fees due for this Policy and each Insurance Policy, HMO
Contract and Service Agreement during the Delinquent Month.
You and We acknowledge and agree that the method of allocating premium and Fees described in this
provision will result in:
(a) the full amount of premium not being paid during the grace period for the Policy and each
Insurance Policy or HMO Contract; and
(b) the full amount of Fees not being paid by the required due date for each Service Agreement.
Accordingly, notwithstanding anything to the contrary in this Policy or any Insurance Policy, HMO
Contract or Service Agreement, the following will occur:
(a) this Policy and any other Insurance Policy or HMO Contract will automatically terminate on the
date described in this Policy and such other Insurance Policy or HMO Contract for non-payment
of premium; and
(b) any Service Agreement will automatically terminate at the end of the Delinquent Month.
TERMINATION OF INSURANCE
This Policy will continue in effect until the end of the Policy period, unless coverage is terminated as set
forth below.
The Policy will terminate on the earliest of:
(a) the date the Plan terminates;
(b) the date You dissolve Your company, suspend active business operations, or are placed in
bankruptcy or receivership;
(c) the later of the date We receive written notice of termination from You, or the termination date
requested by You;
(d) the date described in the Premium Rates, Deductibles and Factor Changes provision of this
Policy;
(e) the date a change in any Policy deductible, deductible factor, or premium rate is effective, but
has not been accepted in writing by You; or
(f) the premium due date if premium is not paid by the end of the grace period.
The Policy may also be terminated, at Our option, on the earliest of
(a) the date You fail to fund the benefits provided by the Plan;
(b) the date You amend the Plan without Our written consent;
(c) the date the number of covered units under the Plan is less than 50;
(d) the date You fails to perform any of the duties described in this Policy; or
(e) the date any administrative services agreement between You and Us is terminated.
We will not refund any premiums Paid by You in the event coverage terminates during a Policy period.
However, if the Policy is rescinded by Us, all premiums received for that Policy period will be refunded
to You.
REINSTATEMENT AFTER THE POLICY ENDS
If this Policy terminates for any reason, it may be reinstated at Our option. It can be reinstated only in
writing by one of Our officers and subject to any written conditions of reinstatement imposed by Us.
SPECIFIC STOP LOSS INSURANCE
Benefits
If Eligible Losses for an Eligible Participant exceed the Specific Deductible, We will reimburse You an
amount equal to the total Eligible Losses for the Eligible Participant minus the Specific Deductible,
multiplied by the Specific Reimbursement Percentage, and minus any previous specific stop loss
insurance reimbursements and other amounts paid to You under any other Policy provisions in force
during this Policy period for that Eligible Participant.
Conditions
1. Specific stop loss insurance reimbursements may not exceed the Maximum Specific Reimbursement.
2. If the Policy terminates during the Policy period, the Specific Deductible will be determined as if
this Policy had remained in effect for the full Policy period. Plan benefits Paid after the Policy
termination date are not Eligible Losses.
i
AGGREGATE STOP LOSS INSURANCE
Benefits
We will reimburse You if Eligible Losses below any Specific Deductible exceed the Annual Aggregate
Deductible. We will reimburse You an amount equal to the total Eligible Losses and minus the total
Eligible Losses in excess of any Specific Deductible, minus the Annual Aggregate Deductible,
multiplied by the Aggregate Reimbursement Percentage, and minus any previous aggregate stop loss
insurance reimbursements and other amounts paid to You under any other Policy provisions in force
during this Policy period.
Conditions
1. Aggregate stop loss insurance reimbursements may not exceed the Maximum Annual Aggregate
Reimbursement.
2. If the Policy terminates during the Policy period:
(a) the Annual Aggregate Deductible will be considered not satisfied; and
(b) We will not be liable for any aggregate stop loss insurance reimbursements.
SUPPORTING
DOCUMENTS
CITY CLERK'S OFFICE
INTEROFFICE MEMORANDUM
DATE: May 10, 2007
TO: Willard Yamaguchi, Chief Deputy City Attorney/Risk Manager
FRO Nelly Giron, City Clerk
RE:T4 Resolution No. 9305 - A Resolution of the City Council
of the City of Vernon Approving and Ratifying the
Execution of a 2007 Amendment to Administrative
Services Agreement By and Between the City of Vernon
and United of Omaha Life Insurance Company
Transmitted herewith is a copy of Resolution No. 9305 referenced
above, which was approved by City Council on May 7, 2007.
Thank you
NG:dr
C: Cindy Calzada
Agreement File No. 07-049
Resolution No.