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HomeMy WebLinkAboutResolution - 2004-R0587 - Administrative Services Agreement - ICON Benefits Administrators - 12_16_2004Resolution No. 2004-R0587 December 16, 2004 Item No. 30 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to enter into an Administrative Services Agreement by and between the City of Lubbock and ICON Benefits Administrators, II, L.P. for health insurance claims administration, an employee medical care clinic and cafeteria plan administration. Such agreement is attached hereto and incorporated herein and into the minutes of the Council as though set forth fully therein. Passed by the City Council this 16th day of December , 2004. A M c cDou al, Mayor ATTEST: R ecca Garza, City Secretary APPROVED AS TO CONTENT: Quincy Wh• Assistant City Manager APPROVED AS TO FORM: Matthew L. Wade Natural Resources Attorney Resolution No. 2004-R0587 December 16, 2004 Item No. 30 ADMINISTRATIVE SERVICES AGREEMENT THIS Service Agreement is made and entered into this 16th day of December , 2004,. by and between the City of Lubbock (hereinafter referred to as the "Plan Sponsor") and ICON Benefit Administrators U, L.P., a corporation duly organized and existing under the laws of the state of Texas (hereinafter referred to as the "Claims Supervisor"). WITNESSETH WHEREAS, the Plan Sponsor is a corporation that sponsors a self -funded employee welfare benefit plan (the "Plan") within the meaning of the Employee Retirement Income Security Act of 1974 (ERISA), as amended; and WHEREAS, the Plan Sponsor desires to make available a program of health care benefits under the Plan; and WHEREAS; the Plan Sponsor wishes to contract with an independent third party to perform certain services with respect to the Plan as enumerated below; and WHEREAS, the Claims Supervisor desires to contract with the Plan Sponsor to perform certain services with respect to the Plan as enumerated below; and THEREFORE, in consideration of the premises and mutual covenants contained herein, the Plan Sponsor and the Claims Supervisor enter into this Agreement for administrative services for the Plan. ARTICLE I: DEFINITIONS For the purposes of this Agreement, the following words and phrases have the meanings set forth below, unless the context clearly indicates otherwise and wherever appropriate, the singular shall include the plural and the plural shall include the singular. 1.1 Calendar Year means January 1 st through December 31 st of the same year. 1.2 Claim means a request by a Claimant for payment or reimbursement for Covered Services from the Plan 1.3 Claimant means any person or entity submitting expenses for payment or reimbursement from the Plan 1.4 Claims Payment Account means an account established by and owned by the Plan Sponsor for payment or reimbursement for Covered Services, which Account shall be an asset of the Plan Sponsor. 1.5 COBRA means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended. 1.6 Covered Services means the care, treatments, services, or supplies described in the Plan Document as eligible for payment or reimbursement from the Plan. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 1 of 32 1.7 Employer means the City of Lubbock, and any successor organization or affiliate of such Employer that assumes the obligations of the Plan and this Agreement. 1.8 ERISA means the Employee Retirement Income Security Act of 1974, as amended. 1.9 Fee Schedule means the listing of fees or charges for services provided under this Agreement. This Fee Schedule may be modified from time to time in writing by the mutual agreement of the parties. It is contained in Appendix A and is a part of this Agreement. 1.10 Health Care Providers means physicians, dentists, hospitals, or other medical practitioners or medical care facilities that are duly licensed and authorized to receive payment or reimbursement for Covered Services provided under the terms of the Plan. 1.11 Minimum Funding Balance means the minimum amount required to be maintained by the Plan Sponsor in accordance with the Fee Schedule in the Claims Payment Account at all times during the term of this Agreement. 1.12 Plan means the self -funded employee welfare benefit plan, which is the subject of this Agreement and which the Plan Sponsor has established pursuant to the Plan Document. 1.13 Plan Document means the instrument or instruments that set forth and govern the duties of the Plan Sponsor and eligibility and benefit provisions of the Plan that provide for the payment or reimbursement of Covered Services. 1.14 Plan Participant is any person who is properly enrolled and entitled to benefits from the Plan. 1.15 Plan Year means the period of time specified as such in the Plan Document. 1.16 Summary Plan Description means the document required to be provided under Sec. 102 of ERISA that describes the terms and conditions under which the Plan operates. ARTICLE II: RELATIONSHIP OF PARTIES 2.1 The Plan Sponsor delegates to the Claims Supervisor only those powers and responsibilities with respect to development, maintenance, and administration of the Plan that are specifically incorporated into and enumerated in this Agreement. Any function not specifically delegated to and assumed by the Claims Supervisor pursuant to this Agreement shall remain the sole responsibility of the Plan Sponsor. 2.2 The parties enter into this Agreement as independent contractors and not as agents of each other. Neither party shall have any authority to act in any way as the representative of the other, or to bind the other to any third party, except as specifically set forth herein. 2.3 The parties acknowledge that: (a) This is a contract for administrative services only as specifically set forth herein; CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 2 of 32 (b) The Claims Supervisor shall not be obligated to disburse more in payment for Claims or other obligations arising under the Plan than the Plan Sponsor shall have made available in the Claims Payment Account; and (c) This Agreement shall not be deemed a contract of insurance under any laws or regulations. The Claims Supervisor does not insure, guarantee, or underwrite the liability of the Plan Sponsor under the Plan. The Plan Sponsor has total responsibility for payment of Claims under the Plan and all expenses incidental to the Plan. (d) The provisions of Exhibit A: Agreement and Designation of Bookkeeper, attached hereto, shall be incorporated as part of this agreement and be binding upon the parties. (e) The provisions of Exhibit B: On -Site Clinic Services, attached hereto, shall be incorporated as part of this Agreement and be binding upon the parties. 2.4 Except as specifically set forth herein, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective legal representatives and successors; provided, however, neither party may assign this Agreement or any or all of its rights or obligations hereunder (except by operation of law) without the prior written consent of the other, which consent may not be unreasonably withheld. 2.5 The Parties agree that in the event of a dispute and prior to initiating arbitration proceedings, the parties will each designate one (1) senior company officer to negotiate a resolution to the dispute. If the designated representatives are unable to agree upon a resolution within thirty (30) days, or any agreed upon extension, they the parties agree to submit the dispute to Arbitration for final and binding resolution. Any dispute, controversy, or claim arising out of or relating to this Agreement or the breach, interpretation, termination, or validity thereof shall be settled by final and binding arbitration by a single arbitrator in accordance with this agreement and the Texas General Arbitration Act (Texas Civil Practices and Remedies code, Section 171.001 et seq.). The parties shall select one American Arbitration Association approved arbitrator pursuant to the rules and procedures proscribed by the AAA. The place of the arbitration shall be Lubbock, Texas, U.S.A. The arbitrator shall apply the laws of Texas to the substance of the dispute. The Parties agree that the award of the arbitrator shall be the sole exclusive remedy between them regarding any claims, counterclaims, issues, or accountings presented or pleaded to the arbitrators. Any award issued by the arbitrator shall be promptly paid to the prevailing party by the losing party and such payment shall be payable free of any tax, deduction, or offset. If the losing party fails or refuses to promptly pay such award, or inhibits or unduly delays the payment of such award, the losing party shall pay to the prevailing party any and all costs, fees, taxes, or attorneys fees incurred by the prevailing party in enforcing the arbitrator's award. 2.6 The work to be performed by the Claims Supervisor under this Agreement may, at its discretion and with the prior approval of the Plan Sponsor, be performed directly by it or wholly or in part through a subsidiary or affiliate of the Claims Supervisor or under an agreement with an organization, agent, advisor, or other person of its choosing. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 3 of 32 2.7 The Claims Supervisor agrees to be duly licensed as a Third Party Administrator to the extent required under applicable law and agrees to maintain such licensure throughout the term of this Agreement. The Claims Supervisor will possess throughout the term of this Agreement, an in -force fidelity bond or other insurance as maybe required by state and federal laws for the protection of its clients. Additionally, the Claims Supervisor agrees to comply with any state or federal statutes or regulations regarding its operations and to obtain any additional licenses or registrations that may apply in the future. 2.8 The Claims Supervisor will indemnify, defend, save, and hold the Plan Sponsor, the Plan Sponsor's respective officers, employees, elected officials and/or agents harmless from and against any and all claims, suits, actions, administrative actions, liabilities, losses, fines, penalties, damages, and expenses of any kind including, but not limited to, direct, indirect, consequential, or punitive damages, expenses or fees, including court costs and attorney's fees, with respect to the Plan which result from or arise directly or indirectly, in whole or in part, or are related to, in any way, manner, or form, caused, or contributed to, by the negligence or fault of the Claims Supervisor, its officials, employees and/or agents. 2.9 To the extent permitted by law, Plan Sponsor will indemnify, defend, save, and hold the Claims Supervisor harmless from and against any and all claims, suits, actions, administrative actions, liabilities, losses, fines, penalties, damages, and expenses of any kind including, but not limited to, direct, indirect, consequential, or punitive damages, expenses or fees, including court costs and attorney's fees, with respect to the Plan which result from or arise directly or indirectly, in whole or in part, or are related to, in any way, manner, or form, caused, or contributed to, by the negligence or fault of the Plan Sponsor, its officials, employees and/or agents. 2.10 Claims Supervisor is responsible for maintaining, during the life of this Agreement, liability insurance sufficient to protect it from claims of personal injury or property damage that may arise from its activities under this Agreement. The City of Lubbock shall be named as a certificate holder under such policies. Claims Supervisor shall provide to the Plan Sponsor prior to the execution of this Agreement copies of such insurance agreements and Claims Supervisor agrees to provide updated copies of the insurance policies to the Plan Sponsor on the reissuance or renewal of such policies. Claims Supervisor is also responsible for maintaining, during the life of this Agreement, an Errors and Omissions insurance policy in the amount of two million dollars (2,000,000.00). However, if the Plan Sponsor should require additional coverage, Claims Supervisor shall purchase such coverage at the sole expense of the Client. Claims Supervisor is also responsible for maintaining, during the life of this Agreement, a Crime Bond in the amount of five hundred thousand dollars ($500,000). Claims Supervisor shall be the Principal and Obligor under the Crime Bond and the City of Lubbock shall be the Obligee and the Crime Bond shall be issued by a company approved by Plan Sponsor and licensed to conduct business in the State of Texas. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 4 of 32 ARTICLE III: THE CLAIMS SUPERVISOR'S RESPONSIBILITIES The Claims Supervisor will provide the following Plan administrative services for the Plan Sponsor: 3.1 Maintain Plan records based on eligibility information submitted by the Plan Sponsor as to the dates on which a Plan Participant's coverage commences and terminates. Maintain Plan records of plan coverage applicable to each Plan Participant based on information submitted by the Plan Sponsor. Maintain Plan records regarding payments of Claims, denials of Claims, and Claims pended. 3.2 Verify Plan Participant eligibility and coverage upon request by a Plan Participant, an authorized member of a Plan Participant's family unit, or an authorized Health Care Provider treating a Plan Participant. 3.3 Administer initial enrollment of Plan Participants, including but not limited to, assisting in application completion; distributing enrollment forms and answering inquires; creating and maintaining enrollment records for Plan Participants; make identification cards and other Plan materials available to the Plan Sponsor for distribution to new Plan Participants. (Some additional fees may apply for certain services, please consult Appendix A for details). 3.4 Adjudicate Claims incurred by Plan Participants according to the terms of the Plan Document as construed by the Plan Sponsor. These Claims will be adjudicated in accordance with industry practices and the Claims Supervisor will use an industry - recognized method of determining usual, customary, and reasonable charges. Process with due diligence and according to the terms of the Plan Document as construed by the Plan Sponsor, evidence of good health statements, pre-existing conditions requirements, disability determinations, subrogation, and coordination of benefits situations. Unless otherwise agreed by the parties, the Claims Supervisor's duties with respect to subrogation situations shall be limited to informing the Plan Sponsor that subrogation rights may exist. When all necessary documents and Claim form information have been received and the Claim has been approved, a Claim check or draft will be remitted on the next dispersal date. 3.5 Refer any doubtful or disputed Claims to Plan Sponsor for a final decision in accordance with Section 4.2. 3.6 Process, issue, and distribute Claims checks or drafts as instructed by the Plan Sponsor to Plan Participants, Health Care Providers, or others as may be applicable. Claims paid in good faith but in error by the Claims Supervisor shall be chargeable to the Claims Payment Account as any other Claim, but the Claims Supervisor shall make good faith attempts to recover any overpayments. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 5 of 32 The Claims Supervisor will notify the Plan Sponsor of the amount required to be prospectively deposited to the Claims Payment Account to pay the Claims liability as these Claims occur. 3.7 Notify Plan Participants in writing through the U. S. Mail of ineligible Claims received, indicating the specific Plan provisions attributable to the declination of the Claims pursuant to the written Claims review and appeal procedure in the Plan. 3.8 Respond to Claims inquiries by a Plan Participant, the estate of a Plan Participant, an authorized member of a Plan Participant's family unit, or an authorized Health Care Provider. 3.9 Maintain information that identifies a Plan Participant in a confidential manner. The Claims Supervisor shall prevent disclosure or the use of Claims information for a purpose unrelated to the administration of the Plan. The Claims Supervisor will only release this information for certificate of need reviews; for medical necessity determinations; to set uniform data standards; to update relative values scales; to use in Claims analysis; to use in the procurement of excess -loss or stop - loss insurance coverage; to further cost containment programs; to verify eligibility; to comply with federal, state or local laws; for coordination of benefits; for subrogation; in response to a civil or criminal action upon issuance of a subpoena; or with the written consent of the Plan Participant or his other legal representative. However, nothing contained herein shall discharge or otherwise relieve the Claims Supervisor from following all applicable federal or state laws, regulations, and/or procedures. The Claims Supervisor shall indemnify and hold harmless, without limitation and to the fullest extent permitted by law, the Plan Sponsor, and the Plan Sponsor's respective officers, employees, elected officials, and agents, from and against any and all losses, business losses, damages, claims, or liabilities, or any kind or nature, which arise directly or indirectly, or are related to, in any way, manner, or form, caused, or contributed to by the negligence or fault of the Claims Supervisor, it's officials, employees and/or agents in the improper or illegal release of confidential information kept, maintained or possessed by the Claims Supervisor pursuant to this Agreement. This indemnity shall not apply when the Claims Supervisor releases confidential information solely at the direct instruction of the Plan Sponsor. The Claims Supervisor further covenants and agrees to defend any suits or administrative proceedings brought against the Plan Sponsor and/or the Plan Sponsor's respective officers, employees, elected officials and/or agents on account of any such claim brought relating to an improper or illegal release of confidential information kept, maintained, or possessed by the Claims Supervisor pursuant to this Agreement, and the Claims Supervisor agrees to pay or discharge the full amount or obligation of any such claim incurred by, accruing to, or imposed on the Plan Sponsor, or the Plan Sponsor's respective officers, employees, elected officials and/or agents, as applicable, resulting from any such suits, claims, and/or administrative proceedings or any matters resulting from the settlement or resolution of said suits, claims, and/or administrative proceedings. In addition, the Claims Supervisor shall pay to the Plan Sponsor, the Plan Sponsor's respective officers, employees, elected officials and/or agents, as applicable, all CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 6 of 32 attorney's fees incurred by such parties in enforcing the Claims Supervisor's indemnity in this section. 3.10 Prepare a draft Plan Document and Summary Plan Description for review and final approval by Plan Sponsor and the Plan Sponsor's legal counsel. Upon acceptance by the Plan Sponsor, the Claims Supervisor, if requested to so by the Plan Sponsor, will then furnish copies of the Summary Plan Description sufficient for distribution to all Plan Participants. A separate fee for printing of these documents will be billed. Additional copies and future amendments or modifications may be an additional cost negotiated between the Claims Supervisor and the Plan Sponsor. 3.11 Prepare Plan Document amendments. 3.12 Maintain a Claim file on every Claim reported to it by the Plan Participants. Such files and all Plan -related information shall be made available to the Plan Sponsor for consultation, review, and audit upon reasonable notice and request, during the business day and at the office of the Claims Supervisor. Any such audit will be at the sole expense of the Plan Sponsor. The Claims Supervisor will charge a separate fee for its time spent in cooperation with such consultation, review, and audit. This audit shall be conducted by an auditor acceptable to the Plan Sponsor and will include, but not necessarily be limited to, a review of procedural controls, a review of system controls, a review of Plan provisions, a review of the sampled Claims, and comparison of results to performance standards and statistical models previously agreed to by the Plan Sponsor and the Claims Supervisor. 3.13 Capture data for IRS form 5500 filings. 3.14 The Claims Supervisor shall administer COBRA continuation coverage for the health plan and the cafeteria plan to qualified beneficiaries from eligibility information supplied by the Plan Sponsor. This administration will consist of notification to eligible Employees and/or their Dependents following a qualifying event, billing, collection of money, forwarding of premiums to the Plan Sponsor, payment of Claims, ending coverage upon lack of timely payment, or at the end of the COBRA continuation period. A separate fee will be charged for these services. 3.15 Provide the following reports by the 15ffi of the month after the end of the preceding month. (a) Monthly reports: 1. Check Reconciliation Report 2. Loss Fund Summary Report 3. Employee Claim Report 4. Large Claims Report (b) Quarterly Reports: 1. Lag Report for the current quarter 2. Pended Claim Report 3. Benefit Level Summary Report CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 7 of 32 4. Benefit Code Summary Report 5. Employer Claim List Summary Report 3.16 Procure excess -loss or stop -loss (specific and aggregate) insurance proposals and policies for the Plan Sponsor's consideration and selection, which excess loss or stop loss insurance will be an asset of the Plan Sponsor and not of the Plan. 3.17 Notify the excess loss insurance company of any potential large Claims that may become a Claim under the excess loss coverage. On behalf of the Plan, the Claims Supervisor will file in a timely manner and in accordance with all filing and reporting requirements of the excess loss carrier, any Claims for benefits under the excess loss policies. Promptly forward to the Plan Sponsor any premium and other notices received from the excess loss insurance company concerning the policy. 3.18 The Claims Supervisor shall generate and mail certificates of Creditable Coverage to Plan Participants and former Plan Participants from information supplied by the Plan Sponsor. A separate fee will be charged for this service. 3.19 Upon termination of this Agreement, all Claim files, reports, magnetic tapes, filings with governmental entities, and plan documentation will be remitted to the Plan Sponsor. The Plan Sponsor shall be responsible for all shipping costs involved in sending the records to their offices. The Plan Sponsor is obligated to accept delivery of these records. If the Plan Sponsor refuses to accept delivery of the records, they will be destroyed unless the destruction of the records would conflict with any applicable law or regulation. 3.20 Claims Supervisor will issue each month an invoice to the Plan Sponsor for all administrative services provided by the Claims Supervisor, HealthSmart Preferred Care, Il, L.P. (as per the terms and conditions of the Client Service Agreement between the City of Lubbock and HealthSmart), Q-elements, L.P. (as per the terms and conditions of the Service Agreement for Care Management Services between the City of Lubbock and Q- elements), Systemed, L.L.C. (as per the terms and conditions of the Integrated Prescription Drug Program Agreement between the City of Lubbock and Systemed) and Highmark Life Insurance Company (as per the terms and conditions of the Excess Loss Insurance policy agreement between the City of Lubbock and Highmark Life Insurance Company or other agreed upon carrier). The Plan Sponsor shall make payment to the Claims Supervisor pursuant to Section 4.13 of this Agreement. Upon payment, the Claims Supervisor shall make payment to the appropriate parties listed above in the appropriate amounts as required by the respective agreements listed herein. ARTICLE IV. THE PLAN SPONSOR'S RESPONSIBILITIES The Plan Sponsor will: 4.1 Maintain current and accurate Plan eligibility and coverage records and submit this information to the Claims Supervisor. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 8 of 32 This information shall be provided in a format reasonably acceptable to the Claims Supervisor and include the following for each Plan Participant: name and address, Social Security number, date of birth, type of Coverage, sex, relationship to employee, changes in coverage, date coverage begins or ends, and any other information necessary to determine eligibility and coverage levels under the Plan. The Plan Sponsor assumes the responsibility for the erroneous disbursement of benefits by the Claims Supervisor in the event of error or neglect on the Plan Sponsor's part of providing eligibility and coverage information to the Claims Supervisor, including but not limited to: failure to give timely notification of ineligibility of a former Plan Participant. 4.2 Resolve all Plan ambiguities and disputes relating to the Plan eligibility of a Plan Participant, Plan coverage, denial of Claims or decisions regarding appeal or denial of Claims, or any other Plan interpretation questions. The Claims Supervisor will administer and adjudicate Claims in accordance with Article III of the Plan Document and Summary Plan Description are clear and unambiguous as to the validity of the Claims and the Plan Participants' eligibility for coverage under the Plan, but will have no discretionary authority to interpret the Plan or adjudicate Claims. If adjudication of a Claim requires interpretation of ambiguous Plan language, and the Plan Sponsor has not previously indicated to the Claims Supervisor the proper interpretation of the language, then the Plan Sponsor will be responsible for resolving the ambiguity or any other dispute. In any event, the Plan Sponsor's decision as to any Claim (whether or not it involves a Plan ambiguity or other dispute) shall be final and binding. 4.3 The Plan Sponsor shall provide required COBRA notice to Plan Participants upon initial eligibility to participate in the Plan and maintain COBRA eligibility records. 4.4 Prospectively fund the Claims Payment Account every month, maintain the Minimum Funding Balance stipulated in the Fee Schedule, and grant the Claims Supervisor drafting authority. 4.5 Not require the Claims Supervisor, under any circumstances, to issue payment(s) for Claims, excess loss premiums, or any other costs arising out of the subject matter of this Agreement, unless the Plan Sponsor has so authorized and has previously deposited sufficient funds to cover such payment(s). 4.6 Provide the Claims Supervisor with copies of any and all revisions or changes to the Plan within 30 working days of the effective date of the changes. 4.7 Provide and timely distribute all notices and information required to be given to Plan Participants, maintain and operate the Plan in accordance with applicable law, maintain all record keeping, and file all forms relative thereto pursuant to any federal, state, or local law, unless this Agreement specifically assigns such duties to the Claims Supervisor. 4.8 Acknowledge that it is the Plan Sponsor, Plan Administrator, and Named Fiduciary as these terms are defined in ERISA. As such, Plan Sponsor retains full discretionary CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 9 of 32 control and authority and discretionary responsibility in the operation and administration of the Plan. 4.9 Pay any and all taxes, surcharges, licenses, and fees levied, if any, by any local, state, or federal authority in connection with the Plan. 4.10 To the extent permitted by law, hold confidential information obtained that is proprietary to the Claims Supervisor 4.11 Provide information necessary to submit to the Claims Supervisor for timely generation of Certificates of Creditable Coverage to Plan Participants and former Plan Participants. 4.12 Warrant and represent that the only entities that participate, or will participate, in the Plan are in the Plan Sponsor's "controlled group of corporations" as that term is used in ERISA. 4.13 Based on the then applicable number of Plan Participants, Plan Sponsor shall remit payment to Claims Supervisor any and all fees properly due and owing per the fee schedule outlined in Appendix A by the 15`h of the month or in the event the 15`h falls on a weekend or holiday, the first business day following the 15'h of the month. ARTICLE V. PLAN ACCOUNTS 5.1 Plan Sponsor shall provide, in a timely manner, funds necessary to be used to make payments of benefits to Plan Participants in the Plan as funds are needed to cover such payments. It shall be the sole responsibility of Plan Sponsor to provide funds sufficient to cover drafts issued by Claims Supervisor as payment for the benefits provided in the Plan. Such funds shall deposited by the Plan Sponsor in the Claims Payment Account for the purpose of allowing the Claims Supervisor to process claims. 5.2 The Claims Supervisor shall have authority to process claims and prepare a register of checks, drawn on the Claims Payment Account, that are needed to pay the claims processed. This check register shall be presented to the Plan Sponsor for its approval before the Claims Supervisor shall release the checks to satisfy payment of the claims. 5.3 Notice, as contemplated in this section, shall be sufficient if made by telephone, mail, fax, electronic mail, or personal delivery, and such notice shall be effective if made to the employee designated by Plan Sponsor or to the person whose signature appears on behalf of Plan Sponsor on the signature page herein. ARTICLE VI. ADVERTISING/MARKETING 6.1 In the conduct of business hereunder, Claims Supervisor may use only such advertising materials as are in compliance with the laws, rules and regulations of the jurisdictions in which used and which have been approved in writing by Employer in advance of their use. No written or oral advertising, or marketing material, or letterhead, business card or other similar matter or material, which includes Employer's name or otherwise refers to Employer may be printed, published, distributed or used in any way without the prior written approval thereof by Employer. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 10 of 32 6.2 Claims Supervisor will assist in the marketing of the Plan. Claims Supervisor will assist in developing marketing materials specific to the program and distributing said materials to eligible groups. In addition, it will assist in the oversight of the Plan's web site which has also been developed for marketing and servicing purposes. The Claims Supervisor will visit prospective groups, participate in answering questions concerning the Plan products, and handle enrollment meetings. ARTICLE VII. DURATION OF AGREEMENT 7.1 This Agreement and all associated exhibits, addenda, and appendices shall commence on January 1, 2005 and end on December 31, 2006. Notwithstanding the termination of this Agreement, Claims Supervisor agrees to continue to render services hereunder and the Plan Sponsor agrees to pay for services of the Claims Supervisor in accordance with Section H of Appendix A attached hereto. 7.2 This Agreement may be terminated by either the Plan Sponsor or the Claims Supervisor with or without default, at any time, upon giving 60 days advance written notice to the other party or as provided in Section 7.4 and Section 7.5 below. Upon breach of any term of condition contained in this Agreement, at the option of the party initiating the termination, the other party may be permitted a cure period (of length determined by the party initiating the termination) to cure any default. 7.3 The Claims Supervisor may, at its option, terminate this Agreement effective immediately upon the occurrence of any one or more of the following events on written notice to the Plan Sponsor: (a) The Plan Sponsor fails to maintain the Minimum Funding Balance or to prospectively fund the Claims Payment Account; (b) The Plan Sponsor is adjudicated as bankrupt, becomes insolvent, a temporary or permanent receiver is appointed by any court for all or substantially all of the Plan Sponsor's assets, the Plan Sponsor makes a general assignment for the benefit of its creditors, a voluntary petition under any bankruptcy law, or an involuntary petition under any bankruptcy law is filed with respect to the Plan Sponsor and such involuntary petition is not dismissed within forty-five (45) days of such filing; (c) The Plan Sponsor fails to pay administration fees or other fees for the Claims Supervisor's services upon presentation for payment and in accordance with the terms and conditions of Section 4.13; (d) The Plan Sponsor violates any federal, state, or other government statute, rule, or regulation relating directly to the Plan; (e) The Plan Sponsor permits its excess loss insurance to lapse, whether by failure to pay premiums or otherwise. 7.4 The Plan Sponsor may, at its option, terminate this Agreement effective immediately upon the occurrence of anyone or more of the following events on written notice to the Claims Supervisor: CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 11 of 32 (a) The Claims Supervisor is adjudicated as bankrupt, becomes insolvent, a temporary or permanent receiver's appointed by any court for all or substantially all of the Claims Supervisor's assets, the Claims Supervisor makes a general assignment for the benefit of its creditors, a voluntary petition is filed under any bankruptcy law, or an involuntary petition under any bankruptcy law is filed with respect to the Claims Supervisor and such involuntary petition is not dismissed within forty-five (45) days of such filing; (b) The Claims Supervisor engages in any illegal business practice which is in violation of any federal, state, or other government statute, rule, or regulation; or (c) The Claims Supervisor, through its acts, practices or operations, exposes the Plan Sponsor to any existing or potential investigation or litigation. 7.5 At the written request of the Plan Sponsor and subject to the Plan Sponsor's continuing obligation to maintain the Minimum Funding Balance and to prospectively fund the Claims Payment Account, the Claims Supervisor agrees to process incurred but not reported Claims after the termination of this agreement. A separate fee will be charged for this service ARTICLE VIII: CONTRIBUTIONS 8.1 Claims Supervisor shall, while this Agreement is in effect, receive for and on behalf of Plan Sponsor, and as Plan Sponsor's fiduciary, all payments made by Plan Participants in connection with their coverage under the Plan and in connection with the administration thereof; Such payments shall include, but are not limited to, Contributions for such Plan coverage and such other fees as may be directed in writing from time to time by Plan Sponsor to Claims Supervisor. 8.2 Claims Supervisor warrants that all payments made by Plan Participants to Claims Supervisor shall, upon receipt by Claims Supervisor, be deposited within two business days in one or more segregated, non -commingled accounts, as directed by Plan Sponsor, maintained with a Federal or State banking institution authorized to do business in Texas and acceptable to Plan Sponsor. All such accounts shall be established by Plan Sponsor and such accounts and the balances thereof, including any and all interest which may accrue thereunder from time to time, shall be the property of Plan Sponsor. Plan Sponsor may from time to time, at its sole discretion, name one or more employees of Claims Supervisor or other duly appointed representative of Plan Sponsor as signatories on one or more of such accounts and may, at its sole discretion, terminate at any time and without prior notice the signature of anyone so named. Claims Supervisor further warrants that withdrawals from each such account made or authorized by an employee of Claims Supervisor who is an authorized signatory on such account shall be made and used for only the purposes of properly paying a Claim as authorized under this Agreement or as otherwise authorized, in writing, by the Plan Sponsor. 8.3 Payment of any Contributions or required fees to Claims Supervisor by or on behalf of a Plan Participant shall be deemed payment to Plan Sponsor. The payment of any return contributions, fees, or claims to Claims Supervisor shall not be deemed payment to a Plan Participant until the Plan Participant receives such payment. CONFIDENTIAL City of LubboeWICON Administrative Services Agreement — Page 12 of 32 ARTICLE IX. MISCELLANEOUS 9.1 This Agreement, together with all addenda, exhibits, and appendices supersedes any and all prior representations, conditions, warranties, understandings, proposals, or other agreements between the Plan Sponsor and the Claims Supervisor hereto, oral or written, in relation to the services and systems of the Claims Supervisor, which are rendered or are to be rendered in connection with its assistance to the Plan Sponsor in the administration of the Plan. 9.2 This Agreement, together with the aforesaid addenda, exhibits, and appendices constitutes the entire Administrative Services Agreement of whatsoever kind or nature existing between or among the parties. 9.3 The parties hereto, having read and understood this entire Agreement, acknowledge and agree that there are no other representations, conditions, promises, agreements, understandings, or warranties that exist outside this Agreement which have been made by either of the parties hereto, which have induced either party or has led to the execution of this Agreement by either party. Any statements, proposals, representations, conditions, warranties, understandings, or agreements which may have been heretofore made by either of the parties hereto, and which are not expressly contained or incorporated by reference herein, are void and of no effect. 9.4 This Agreement maybe executed in two or more counterparts, each and all of which shall be deemed an original and all of which together shall constitute but one and the same instrument. 9.5 No changes in or additions to this Agreement shall be recognized unless and until made in writing and signed by all parties hereto. 9.6 In the event any provision of this Agreement is held to be invalid, illegal, or unenforceable for any reason and in any respect, such invalidity, illegality, or unenforceability shall in no event affect, prejudice, or disturb the validity of the remainder of this Agreement, which shall be in full force and effect, enforceable in accordance with its terms. 9.7 In the event that either party is unable to perform any of its obligations under this Agreement because of natural disaster, labor unrest, civil disobedience, acts of war (declared or undeclared), or actions or decrees of governmental bodies (any one of these events which is referred to as a "Force Majeure Event"), the party who has been so affected shall immediately notify the other party and shall do everything possible to resume performance. Upon receipt of such notice, all obligations tinder this Agreement shall be immediately suspended. If the period of non-performance exceeds ten (10) working days from the receipt of notice of the Force Majeure Event, the party whose ability to perform has not been so affected may, by giving written notice, terminate this Agreement. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 13 of 32 9.8 All notices required to be given to either party by this Agreement shall, unless otherwise specified in writing, be deemed to have been given three (3) days after deposit in the U.S. Mail, first class postage prepaid, certified mail, return receipt requested. 9.9 This Agreement shall be interpreted and construed in accordance with the laws of the state of Texas except to the extent superseded by federal law, 9.10 No forbearance or neglect on the part of either party to enforce or insist upon any of the provisions of this Agreement shall be construed as a waiver, alteration, or modification of the Agreement. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on their behalf by their duly authorized representatives' signatures, effective this 1st day of 3aniseti r y , 2005 CLAIMS SUPERVISOR: BY PRINTED NAME: TITLE: / i i // ki CITY OF LUBBOCK, PLAN SPONSOR Q-4—� —yc\---n" Reb6ca Garza, City Secretary APPROVED AS TO CONTENT: t 17�incy White, ' tant City Manager APPROVED AS TO FORM: Matthew L. Wade, Natural Resources Attorney CONMENITAL City of LubbocWICON Administrative Services Agreement — Page 14 of 32 Resolution No. 2004-RO587 December 16, 2004 Item No. 30 APPENDIX A FEE SCHEDULE AND FINANCIAL ARRANGEMENT I. Fee Schedule The Plan Sponsor and the Claims Supervisor hereby agree to the compensation schedules set forth below as being the sole compensation to the Claims Supervisor for any of its services which relate to the Plan. Monthly Medical Administration fee of $13.95 per employee per month. Rx Administration — fee is included in the above stated Medical monthly administration amount. PPO Administration — fee is included in the above stated Medical monthly administration amount. COBRA Administration — fee is included in the above stated Medical monthly administration amount. Certificates of Credible Coverage (HIPAA Administration) — fee is included in the above stated Medical monthly administration amount. Plus a monthly Dental Administration fee of $2.95 per employee per month. ID Cards - replacement cards $35 each. $2.50 for each Booklet Summary of Plan Document or Plan Document booklet printed. Annual Maintenance Fee - $500. - For review and analysis of current Plan Document to ensure full compliance with all Legislative Regulations New York Surcharge - $500 if elected ❑XX ELECT ❑ DO NOT ELECT 5500 Medical Plan Filing Fee - $500 annually if requested All fees outlined under Article 6 of Exhibit A, attached hereto Check customization, special statistical reports other than those enumerated in this contract, medical underwriting, new taxes assessed against the Plan, or other services mutually agreed upon, will be billed separately at the actual costs of such services. If Plan Sponsor elects to have I.D. cards distributed to each participant by mail, an additional postage fee will be charged at the rate of. $.20 per employee per month CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 15 of 32 II: Termination Provision: Fee for Claims Processing after Termination: Three (3) months of administrative fees ($11.50 Medical 1$1.50 Dental) calculated using the average number of employee for the last three (3) months. A standard report package, including an accumulator report, census report, and claim detail report, is included with this fee. Minimum charge of $1,000.00 applies. Fees for Certificates of Credible Coverage: Certificates of Credible Coverage will be generated and sent to the Employers attention. Report fees if run off processing not elected: $250.00 per report. III. Financial Arrangement The Plan Sponsor agrees to do the following; Maintain a Minimum Funding Balance in the Claims Payment Account of $10,000. Maintain specific excess loss insurance. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 16 of 32 Resolution No. 2004-RO587 December 16, 2004 EXHIBIT A Item No. 30 AGREEMENT AND DESIGNATION OF RECORDKEEPER PREAMBLE This AGREEMENT AND DESIGNATION OF RECORDKEEPER is made this day of , 2004, to be effective as of January 1, 2005, by and between the City of Lubbock (hereinafter referred to as the "Employer") and ICON Benefit Administrators H, L.P., a corporation (the "Administrator/Recordkeeper'). WITNESSETH: WHEREAS, the Employer has, effective , 2004, adopted the Section 125 Flexible Benefit Plan (hereinafter referred to as the "Plan"), for the benefit of employees (and their Beneficiaries) of such Employer; and WHEREAS, the Employer desires to engage the recordkeeping services of the Administrator/Recordkeeper (hereafter referred to as the "Administrator"); NOW, THEREFORE, the Employer and the Administrator mutually agree as follows: ARTICLE I DEFINITIONS Capitalized terms used herein and not otherwise defined herein shall have the same meaning as set forth in the Plan. The masculine gender shall include both sexes; the singular shall include plural and the plural the singular, unless the context otherwise requires. 1.01 Account The account established by the Administrator on behalf of the Employer from which benefits are to be paid in accordance with the terms of the Plan and this Agreement. 1.02 Administrator Of the Plan under the terms of this Agreement shall be ICON Benefit Administrators 11, L.P. 1.03 Agreement Shall mean this Agreement and Designation of Recordkeeper, as set forth herein, with any and all further supplements and amendments thereto. 1.04 Code The Internal Revenue Code of 1986, as amended from time to time, and successor tax laws. 1.05 Employer As shown in the Preamble of the Agreement and Designation of Recordkeeper and its successors. 1.06 Participant An Employee of an Employer who participates in the Plan under the participation provisions thereof. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 17 of 32 1.07 Plan The Plan as referred to in the Preamble of the Administration/Recordkeeping Agreement as hereafter amended from time to time. 1.08 Recordkeeper ICON Benefit Administrators IL L.P. as duly appointed by the Employer pursuant to the terms of the Plan to provide recordkeeping services for the Plan. ARTICLE II POWERS AND DUTIES OF THE ADMINISTRATOR 2.01 ADMINISTRATOR: The Administrator shall provide guidance to the Employer as to the operation of the Plan and to maintaining the tax qualification of the Plan. The duties of the Administrator shall be only as provided under this Agreement or as otherwise agreed to, in writing, by the Administrator. 2.02 RESPONSIBILITIES AND DUTIES OF THE ADMINISTRATOR: The Administrator shall provide the following services to the Employer: a. Assist the Employer with establishing the Plan. Part of this service will include providing a Sample Plan Document. b. Assist the Employer in keeping the Plan in compliance with Section 125 of the Internal Revenue Code and the current and future rules and regulations thereunder. C. Assist in the enrollment of the Plan Participants. d. Provide correct enrollment data to the Employer. e. Provide such assistance as may be requested by the Employer to maintain the Plan, including assisting the Employer in interpreting the provisions of the Plan for all purposes in connection with the operation and administration of the Plan. ARTICLE III POWERS AND DUTIES OF THE ADMINISTRATOR AS RECORDKEEPER 3.01 RECORDKEEPER: The. Administrator shall provide the recordkeeping and other ministerial services as the Recordkeeper appointed by the Employer as such under the terms of the Plan. The duties of the Recordkeeper shall be only as provided under this Agreement, the Policy or as otherwise agreed to, in writing, by the Recordkeeper. 3.02 POWERS OF THE RECORDKEEPER: The Recordkeeper shall have such powers as are necessary for the proper payment of claims for medical expense reimbursement and dependent care expense reimbursement benefits under the Plan, including, but not limited to, the following: a. To prescribe procedures to be followed by Participants in filing applications for benefits under the Plan and for furnishing evidence necessary to establish their rights to benefits under the Plan; CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 18 of 32 b. To apply the provisions of the Plan as interpreted by the Administrator and the Employer in determining the rights of any Participant who applies for benefits under the Plan and to notify any such Participant of any such determination; and C. To obtain from the Employer, Participants and others, information as shall be necessary for proper accounting of expense reimbursement benefit payments made pursuant to the terms of the Plan and the directions of the Administrator and Employer. Provided, the foregoing notwithstanding, the Recordkeeper shall have no power to add to or subtract from or to modify any of the provisions of the Plan, or to change or add to any benefit provided in the Plan. 3.03 CLAIMS PROCEDURE: The Recordkeeper shall pay or deny claims for reimbursement of medical expenses and dependent care expenses in accordance with the terms of the Plan, where applicable. The Recordkeeper shall refer to the Employer any request for review of a denial of benefits pursuant to the provisions of the claim procedures set forth in the Plan. In accordance with the terms of the Plan, the Employer (and not the Recordkeeper) shall have the final and absolute authority to determine the validity of claims and whether claims should be paid or denied. 3.04 DUTIES AS THE RECORDKEEPER: The Recordkeeper shall provide the following recordkeeping services to the Employer: a. At the direction of the Employer, make expense reimbursement benefit payments from the Account to or for the benefit of Participants entitled to such benefits under the Plan. b. Compile and analyze Plan contribution information, including enrollment and enrollment change information, for purposes of determining whether the "25% key employee" nondiscrimination test of Code Section 125 is satisfied, if and only if all required information is provided by the Employer; provided, however, that the Recordkeeper shall not have the duty to determine whether any other nondiscrimination provision applicable under Code Section 125 or any other provision of the Code applicable to any plan or benefit offered or provided under the Plan is satisfied. C. Provide to the Employer annual statements of benefits paid to Participants who participated in the Dependent Care and Medical Reimbursement Expense Plan as set forth in the Plan during the preceding calendar year. d. Prepare a monthly reconciliation of allocations and expense reimbursement benefit payments made from the Account. Provide the Employer with assistance, if needed, in preparing any required reports to the Federal government. Maintain necessary personnel to receive, process, adjust and pay reimbursement claim. g. Assist claimants in filing their reimbursement claims. CONFIDENTIAL City of LubbocWICON Administrative Services Agreement — Page 19 of 32 h. Provide information and answer questions of the Employer and Participants with respect to the benefits paid and reimbursement claims paid both in writing and orally as requested. i. Fully and faithfully perform duties under this Agreement. ARTICLE IV RESPONSIBILITIES OF EMPLOYER 4.01 RESPONSIBILITIES CONCERNING ADMINISTRATOR: The Employer shall take the following actions in connection with its delegation of recordkeeping duties to the Administrator: a. Provide any and all cost, claims, contribution and participation information in the format and frequency that the Administrator determines is necessary to perform its recordkeeping duties. b. Provide an account allocated to disburse claim monies to Participants funded by Participants payroll deductions. C. Interpret the Plan and provide written directions to the Administrator concerning: (i) the interpretation of the terms of the Plan or any expense reimbursement provision thereunder, and (ii) payment of benefits. The Employer does not wish for .the Recordkeeper to prepare the required annual report for the Internal Revenue Service. ARTICLE V ESTABLISHMENT OF ACCOUNT 5.01 ACCOUNT TO HOLD CONTRIBUTIONS: Pursuant to the Plan, the Employer is required to collect contributions. The Employer will set up an Account to retain physical custody of such contributions and has requested that the Administrator as Recordkeeper administer such contributions as agent of the Employer, for the benefit of the Participants in the Plan. In accordance with the terms and provisions of the Plan, the Employer shall collect and remit to the Account all amounts collected under the Plan in order that such amounts may be available to pay benefits. 5.02 ACCOUNT TO REMAIN PROPERTY OF THE EMPLOYER: All contributions to the Account (and the Account itself) shall be deemed to be and remain the exclusive property of the Employer until payment of benefits has occurred. The Administrator shall have no proprietary interest in or title to any amounts held in the Account, its duties hereunder being solely to administer the Account for and on behalf of the Employer and the Participants in accordance with the terms and provisions of the Plan and this Agreement. Further, the Account shall in no manner whatsoever be considered as a trust or other similar entity. 5.03 STATUS OF ADMINISTRATOR: The duties of the Administrator hereunder shall be performed in its capacity as the agent of the Employer for the purposes of administering the Account. Due solely to the fact that the Administrator is administering the Account CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 20 of 32 for and on behalf of the Employer, this fact in no manner whatsoever should be considered as a guarantee to either the Employer or the Participants that all funds which need to be made available for the payment of benefits under the Plan are in the Account. The Administrator does not warrant payment of any amounts otherwise due to be paid under the Plan except with respect to those amounts which the Employer has deposited into the Account for payment of benefits as provided under the Plan. ARTICLE VI FEES FOR SERVICES 6.01 FEES: In consideration of the Recordkeeper performing the services described herein for the Employer, the fee structure is as follows: Medical Reimbursement Administration $ 3.50 (per month)* Dependent Care Administration $ 3.50 (per month)* *Monthly fees are per enrolled member *Minimum Monthly Fee of $75.00 per Month *An annual $100.00 Renewal Fee will be charged for Plan Document update & form preparation *Booklet fee (Total estimated at $568) $2.50 (per booklet)* Payment of all required fees will be made each month during the term of this Agreement following the month in which such services are performed. ARTICLE VII TERM OF AGREEMENT 7.01 TERM: This Agreement shall remain in effect for two years following the effective date. At the end of the term, this Agreement will continue in full force and effect unless either party provides the counter -party with written notice of its intention to terminate this Agreement. Any notice to terminate this Agreement shall become effective ninety (90) days following the date such notice is provided. Further, this Agreement will automatically terminate upon termination of the Plan if the Employer certifies to the Administrator that no further benefits are to be paid to Participants. In the event of termination of this Agreement, the Employer will be solely responsible for the performance of the duties otherwise required to be performed by the Recordkeeper hereunder or under the Plan. Regardless of when this Agreement is terminated, the Administrator shall continue to pay any and all claims incurred during the term of the Plan for a period of sixty (60) days following the date of termination. ARTICLE VIII MISCELLANEOUS 8.01 ACTION BY THE EMPLOYER: Whenever, under the terms of this Agreement, either party is permitted or required to do or perform any act or thing it shall be done and performed by an officer or a proper authority of the party. CONMENTTAL City of LubbocWICON Administrative Services Agreement — Page 21 of 32 8.02 NOTICES: Any notice, advice, direction or report required or given by the Employer to the Administrator pursuant to this Agreement shall be effective only if in written form and delivered to the party to whom addressed. 8.03 APPLICABLE LAW: The provisions of this Agreement shall be construed, administered and enforced according to the laws of the State of Texas. 8.05 AMENDENT: This Agreement may be amended or modified only with the written consent of both parties. 8.06 SEVERABILTTY: If any provision or provisions of this Agreement shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining provisions of this Agreement, but shall be fully severable and the Agreement shall be construed and enforced as if said illegal or invalid provisions had never been inserted herein. 8.07 CONFIDENTIALITY: To the extent permitted by law, any information obtained by the Administrator is confidential, and shall be used solely for purposes of administration of the Plan unless otherwise authorized by the Employer. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be effective- on the date first above written, executed as of December 16, 2004 Name of Employer: City of Lubbock Marc ATTEST: Re6ecca Garza, City Secretary APPROVED AS TO CONTENT: c incy White, &tant City Manager APPROVED AS TO FORM: Matthew L. Wade, Natural Resources Attorney CONFIDENTIAL City of LubbocWICON Administrative Services Agreement — Page 22 of 32 ICON Benefit Administrators H, By: a 2-0 ez,� Title: _ _A�P'o e " , CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 23 of 32 Resolution No. 2004-RO587 December 16, 2004 Item No. 30 EXHIBIT B ON -SITE CLINIC SERVICES This Exhibit B ("Exhibit") for the procurement of On -Site Clinical Services, as incorporated into the Administrative Services Agreement between the City of Lubbock ("Employer") and ICON Benefit Administrators H, L.P. ("ICON") is effective as of the effective date of the Administrative Services Agreement (the "Agreement"), as signed the _ day of , 2004. PURPOSE WHEREAS, ICON has an existing advantageous arrangement with CareATC Texas, Inc. ("Vendor") to provide physicians at employer's places of business to perform certain medical services for the plan members -of the City of Lubbock and/or their dependents; and, WHEREAS, Employer desires to obtain through ICON the services of a physician for the provision of certain medical services to the plan members of the Employer and/or their dependents on the terms and conditions contained herein; and, WHEREAS, Employer desires to take advantage of the existing preferential relationship between ICON and Vendor; and, NOW, THEREFORE, for good and valuable consideration, the receipt and the sufficiency of which are hereby acknowledged, the Employer and ICON hereby agree to the following terms of service: ARTICLE I PROVISION OF PHYSICIAN 1.01 Provision of Physician. Through its existing relationships, ICON shall arrange for a physician ("Physician") to provide the Medical Services (as defined herein) to the employees of Employer and/or the dependents thereof. Neither ICON nor Vendor is committing to the furnishing of a particular person as the Physician and, consequently, the Physician may be changed at any time. Employer shall have the opportunity to interview all final physician candidates and determine which physician will be acceptable to the Employer. Employer shall also have the right to have a physician removed upon written notice, which notice shall specify the time by which physician shall be removed. As used herein, the term "Medical Services" means, with respect to the Employer, the medical services to be furnished by a physician pursuant to this Exhibit The Medical Services that shall be furnished by the Physician are listed on Schedule 1.01, attached hereto. 1.02 Standards of Physician Performance. ICON shall arrange with Vendor to assure that Physician is obligated to perform or deliver according to the following: (a) The Physician shall determine his or her own means and methods of providing Medical Services in connection with this Exhibit. Referrals made for additional medical care shall primarily utilize contracted health system network(s) outlined in the CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 24 of 32 employer health benefit plan. Each plan member and dependent eligible to receive services at the On -Site Clinic shall be examined by the Physician. (b) The Physician shall comply with all applicable laws and regulations with respect to the licensing and the regulation of physicians. (c) The Physician shall provide the Medical Services in a manner consistent with all applicable laws and regulations and in a professional manner consistent with Medical Services provided in the community. (d) The Physician shall maintain, during the term of this Exhibit, Appropriate Credentials including: 1) A duly issued and active and duly license to practice medicine in the State of Texas for the Employer's location without limitation or restriction, 2) A good standing with his or her profession and state professional association, 3) The absence of any license restriction, revocation, or suspension. 4) The absence of any involuntary restriction placed on his or her federal DEA registration, and 5) The absence of any conviction of a felony. (e) In the event that any Physician (1) has his or her license restricted, revoked or suspended, (2) has an involuntary restriction placed on his or her federal DEA registration, (3) is convicted of a felony, or (4) is no longer in good standing with his or her profession and/or state, Physician shall be promptly removed and replaced with another Physician that meets the requirements of Section 1.02 (d). 1.03 Scheduling of Services. Physician will provide the Medical Services at the office of the Employer located at 1602 Avenue N Lubbock Texas according to the following schedule: each Monday through Friday from 8 AM to 5 PM. 1.04 Place of Services. The Employer shall provide the Physician an examination room that is located at such office of the Employer, which examination room shall be reasonably satisfactory, in the judgment of the Physician, for the provision of the Medical Services. In addition, the Employer shall provide to the Physician a private office, which private office may be used by the Physician to maintain a desk and a small refrigerator for the storage of prescription drugs and to store drug samples, medical records, and prescription drugs; the private office shall be reasonably satisfactory to the Physician, in the judgment of the Physician, and the private office shall have a lock which permits the Physician to limit access to the private office. 1.05 Equipment and Supplies. The Employer shall also provide the Physician the equipment and the supplies, which are listed on Schedule 2.01 (in addition to a chair, a desk, a file cabinet and office supplies, all of which shall also be supplied by the Employer). The Physician shall notify, at any time and from time to time, the Employer of the quantity of such equipment and such supplies which the Physician requires in connection with the provision of the Medical Services and the date by which such equipment and such supplies are required and the Employer shall provide such equipment and such supplies by such date. CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 25 of 32 1.07 Responsibilities of Parties. The Physician shall be solely responsible for his or her actions and /or omissions and the actions and/or the omissions of any agent or any employee used by him or her in connection with the Agreement. Neither the Employer nor ICON or Vendor shall incur any liability for the actions or the omissions of the Physician and/or any agent or any employee used by the Physician in connection with this Exhibit. 1.08 Other Licensed Health Professionals. The Employer agrees and acknowledges that Physician may from time to time have other Health Professionals, as defined in the next sentence, assist the Physician during his or her regularly scheduled time at the Employer's place of business. "Health Professional" shall mean a duly licensed registered nurse, medical doctor and licensed physician's assistant. In this regard Section 1.07 shall apply in the same manner to the Health Professional as such section applies to the Physician. From time to time the Physician, upon consent of an employee of the Employer and/or spouse or dependent of the employee, may have medical doctors that are interns or residents associated with one of the medical schools in the state observe and assist the Physician for educational and teaching purposes. The same level of professional standards as set forth in Section 1.02 (d) shall apply as well to Health Professionals other than medical doctor interns and residents. ICON further covenants and warrants that it will execute a written agreement with Physician whereby Physician agrees to indemnify, release and hold Employer harmless from any and all claims arising from the acts and/or omissions by the Physician and/or any agent or any employee used by the Physician in connection with this Exhibit. ICON shall provide Employer an executed copy of such agreement between Physician and ICON prior to executing this Exhibit. This covenant shall be considered a condition precedent to the execution of this Exhibit and failure on the part of ICON to provide the agreement contemplated in this section shall render this Exhibit null and void notwithstanding any other provision contained herein. 1.10 Medical Records. ICON, through its Vendor, shall assure that the Physician will maintain medical records with respect to all of the patients, all of which medical records shall be maintained in a professional manner consistent with the accepted practice of the community in which the Physician provides the Medical Services in connection with this Exhibit; and the HIPAA privacy standards. The Employer understands that all medical records maintained by the Physician will be held by the Physician in strictest confidence and that the Employer will not be entitled to access to the medical records maintained by the Physician. 1.11 Monthly Reports. ICON shall forward to Employer, no later than ten (10) days following the end of the immediately preceding month, a written report with respect to the provision by the Physician of the Medical Services during the immediately preceding month. The written report shall be in form reasonably satisfactory to the Employer and ICON and it is contemplated that the written report will report (a) the number of employees and dependents treated by the Physician during such immediately preceding month, (b) the number of employees for whom primary care services were provided, (c) an itemized report detailing the types of services provided, (d) a comparison between the services provided and what the usual and customary fees would be if such services had been provided somewhere other than at the On -Site Clinic, and (e) a photocopy of the sign -in sheet used by the Physician detailing the name and date of each employee and/or dependent who received Medical Services from the Physician. All such reports and supporting documentation shall be subject to audit by the City. CONFIDENTIAL City of LubbocWICON Administrative Services Agreement — Page 26 of 32 1.12 Noncompliance by the Physician. In the event that the Employer becomes aware of any failure by the Physician to comply with the obligations of the Physician which are contemplated by this Exhibit, the Employer shall immediately provide written notice to ICON of such failure, which written notice shall describe the failure in reasonable detail, and ICON shall use its best efforts to address such failure. ARTICLE II COMPENSATION 2.01Initial Set -Up Fee. Simultaneously with the execution and the delivery of the Agreement, the Employer shall pay to ICON an initial set-up fee, which shall be used to purchase the equipment and the supplies that are negotiated between the parties and initially required by the Physician for the provision of the Medical Services. This equipment and supplies shall be equivalent to those described in Schedule 2.01. The initial set-up fee shall be $6,500.00_and shall be payable upon execution of the Agreement. 2.02 Monthly Fee. No later than the 10th day following receipt of each applicable invoice, Employer shall remit to ICON an advanced payment equal to One -thousand One - hundred Dollars ($1,100.00) per half day (consisting of four (4) hours) or Two -thousand Dollars ($2,000) per full day (consisting of eight (8) hours) for Services to be rendered during the following month. Payment shall be for furnishing access to the Physician as well as the other services and products provided to Employer under this Exhibit. It is the understanding of the Parties that Employer will require the services of at least one full-time physician during the Initial Term of the Exhibit, resulting in an Annual Fee of five hundred twenty thousand dollars ($520,000). Should Employer elect to do so, Employer may choose to remit to ICON a single advance payment equal to the Annual Fee which will become due to ICON during the calendar year covered by the Initial Term of this Exhibit (as defined below) for the services of a single physician at the full-time rate of eight (8) hours per applicable day. If Employer elects to pay in advance for services during the Initial Term, Employer shall be entitled to a one-time discount of eight percent (8%) off of the Annual Fee for that Initial Term, resulting in an amount of four hundred seventy eight thousand dollars ($478,000), due and payable ten (10) days from execution of the Agreement. Services required in excess of the pre- paid single physician or eight hour day will be billed at the standard half -daily rate, as described above. 2.03 Health Risk Assessments. ICON shall arrange for, at Employer's request, periodic Health Risk Assessments ("HRA") for its employees as part of an ongoing effort to promote overall wellness and lower overall healthcare costs. HRH's shall be set up by ICON and administered by an applicable Vendor. All individual results shall be considered private and confidential in accordance with HIPPA privacy standards. Accordingly, only the employee and the Physician, if employee provides the appropriate release, shall have access to the individual results. ICON shall provide to Employer an aggregate report of the HRA data and recommendations on how to improve the overall wellness and lower overall healthcare costs based on this data. No later than the loth day of each calendar month immediately following the receipt of the applicable invoice, the Employer shall pay to ICON the amount of Seventy -Five Dollars ($75.00) per HRA administered during the immediately preceding calendar month. 2.04 Additional Fees. The Employer shall be responsible for medical supplies, equipment and other items that may be required by the Physician to provide adequate Medical CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 27 of 32 Services under this Exhibit. The invoiced amount of such medical supplies, equipment and other items shall be cost plus ten percent (10%) for handling and carrying costs, and ICON shall forward to Employer documentation supporting cost. No later than the 10,' day of the calendar month immediately following the receipt of the applicable invoice, the Employer shall pay to ICON the amount invoiced for medical supplies, equipment and other items purchased during the immediately preceding calendar month. Nothing contained in this section shall preclude Employer from purchasing the medical supplies, equipment and other items directly from Vendors. Any and all medical supplies, equipment or other items purchased by the Employer shall be used exclusively for providing Medical Services pursuant to this Exhibit and may not be used by ICON or Physician at any other facility other than the facility provided by Employer pursuant to Section 1.04. 2.05 Conditional Guarantee. ICON shall guarantee that any and all amounts spent by Employer pursuant to this Exhibit, including without limitation, any Monthly Fees, Annual Fees, Set -Up Fees and/or Additional Fees, (collectively referred to as the "Clinic Expense") over the course of the term of this Exhibit, shall, at a minimum, be offset by the Total Visit Value, as defined herein (the "Guarantee") Employer understands and acknowledges that this Guarantee shall only be valid and enforceable if the term of this Exhibit is for a minimum of two (2) years. This Guarantee shall become null and void if this Exhibit is terminated by either party for any reason prior to the expiration of the aforementioned two-year term. In order to substantiate such savings, it is hereby deemed and established that each and every visit to the On -Site Clinic by an employee or dependent eligible to receive services under this Exhibit shall have a value of one hundred thirty-six dollars and twenty cents ($136.20) ("Per Visit Value"). At the end of the two-year term of this Exhibit, the Employer shall multiply the total number of employees and dependents that have visited the On -Site Clinic by the Per Visit Value established above such product being the "Total Visit Value". If, after the expiration of two-year term of this Exhibit, the Total Visit Value is less than the total Clinic Expense spent by Employer pursuant to this Exhibit, then ICON shall remit to Employer a check or money order equal to the difference between the Total Visit Value and the Clinic Expense within thirty (30) days of expiration of the two-year term. If the Total Visit Value is equal to or greater than the total Clinic Expense, then neither Employer nor ICON shall have any further financial obligation to the other respective party. It is understood by the Employer and ICON that this section shall survive the termination of this Exhibit and shall remain fully valid and enforceable following the expiration of the two- year term until the provisions in this Exhibit are fully performed. ARTICLE III TERM AND TERMINATION 3.01 Term. The term of this Exhibit shall coincide with the term of the Administrative Services Agreement as outlined in Article VII, Section 7.1 of that agreement (the "Initial Term"). Any extension of that Agreement shall automatically extend this Exhibit unless otherwise terminated per Section 3.02 below. Following expiration of the Initial Term, this Exhibit shall be automatically renewed. 3.02 Termination. This Exhibit may be terminated by either party upon sixty (60) days written notice. CONFIDENTIAL City of LubbocWICON Administrative Services Agreement — Page 28 of 32 3.03 Effect of Expiration or Termination. The expiration or the termination of this Exhibit shall not affect the obligation of the Employer to pay compensation to ICON or pay for any outstanding invoice for the period prior to such expiration or termination. ARTICLE IV MISCELLANEOUS 4.01 Non -Disclosure. The Employer and ICON shall take all reasonable steps to insure that information with respect to the existence and the terms of this Exhibit or with respect to the business of the Employer and ICON acquired by virtue of the position of the other party under this Exhibit shall not be disclosed or used outside of the business of either party; provided, however, the foregoing restriction shall not apply to information (a) provided to government authorities as required by applicable law or applicable regulation or consented to by the patient; (b) furnished to healthcare providers involved in a particular patient's case; (c) which is or becomes public knowledge through no fault of either party; or (d) which is otherwise required to be disclosed by applicable law or applicable regulation or pursuant to a court order. 4.02 Access to Books and Records. All Parties agree to provide access to their books and records to the other party, the Comptroller General of the United States, the Secretary of Health and Human Services or their duly authorized designee, to the extent required by S.S.A. 1861(b)(1)(I) and the regulations promulgated thereunder. 4.03 Successors. This Exhibit is binding upon the parties, their successors and assigns. Thirty (30) days notice of any change in ownership, management, etc. shall be given the other party by the party experiencing the change. In such event, this Exhibit shall be assumed upon a change of ownership, change of control, change in management, reorganization, etc. of, or at, Employer. 4.04 Controlling Document. The parties agree that all other controversies, procedures, and requirements which might arise between the parties shall be governed by the terms of the original Agreement, as amended. IN WITNESS WHEREOF, the parties hereto have caused this Exhibit to be executed on the date first above written, effective as of January 1, 2005 Name of Employer: City of Lubbock A." arc McDou 1, Mayor ATTEST: c Q , Rebecca Garza, City Secretary CONFIDENTIAL City of LubbocWICON Administrative Services Agreement — Page 29 of 32 APPROVED AS TO CONTENT: 'ncy White, istant City Manager APPROVED AS TO FORM: at ew L. Wade, Natural Resources Attorney ICO By: Title: %rl #-t5 fix CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 30 of 32 Resolution No. 2004-RO587 December 16, 2004 Item No. 30 SCHEDULE 1.01 "SCOPE OF SERVICES" Services include but are not limited to the following: • Sore throats/ears/headache • Strains/sprains/musculoskeletal problems • Non-specific abdominal pain • Non-specific chest pain • Cough • Sinus • Allergies/allergy injections • Hormone injections • Rashes • Acute urinary complaints • Personal hygiene related problems • Acute injuries/Acute routine office procedures • Minor surgical procedures, such as sutures for laceration treatment • Flu shots • Ordinary and routine care of the nature of a visit to the doctor's office • Review of HRA results and consultation with employee as appropriate CONFIDENTIAL City of Lubbock/ICON Administrative Services Agreement — Page 31 of 32 Resolution No. 2004-RO587 December 16, 2004 Item No. 30 SCHEEULE 2.01 EXAM ROOM SET UP MEDICAL SUPPLIES AND EQUIPMENT Other items may be required by the Physician to deliver Medical Services in accordance with the Exhibit. Exam table/stool Disinfectant Small refrigerator Waste cans Lockable cabinet Waste can liners Gooseneck light Gloves Diag Set 3.5V Halogen/disposable covers Suture supplies Sundry jars Glucose test supplies Pillow/pillow covers (cloth and disposable) Urinalysis supplies Table paper Strep, testing supplies Thermometer/disposable covers Mono testing supplies 4 X 4's Di s osable owns Tongue depressors Disposable drapes Cotton balls Thermometer (freezer) Alcohol 3" Elastic bandage Alcohol dispenser Cold pack Blood pressure cuffs Emesis basins Stethoscope Medications/In'ectables (by physician order) Sur 'cal toe Lab supplies (Tubes, requisitions, tourniquets) Biohazard bags Wall Posters, Charts Biohazard stickers Small desk and chair (if not provided by Employer) "Allergic To" stickers Needles Sharps containers Syringes CONFIDENTIAL City of Lubbock4CON Administrative Services Agreement — Page 32 of 32