Renewal Rates for Worker's Compensation ClaimsMasterpiece on the Mississippi
Dubuque
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2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Acceptance of the Renewal Rates for Worker's Compensation Claims
Administration
DATE: October 26, 2010
Personnel Manager Randy Peck is recommending City Council approval of the renewal
rates for Alternative Services Concepts (ASC), the City's Worker's Compensation
Claims Administrator effective October 1, 2010 through October 30, 2011. Their fee for
medical only claims will increase from $165 per claim to $170 per claim, and indemnity
claims will increase from $760 to $770 per claim. The litigation fee will increase from
$250 plus the base fee to $300 plus the base fee. Fixed medical case management will
increase from $68 per hour to $75 per hour. The minimum deposit and claims fee will
increase from $25,520 to $27,760. The only other change has to do with the options
that would be available to the City should the City cancel the contract. Should the City
cancel the contract with ASC, they would no longer manage claims based on their time
and expense.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Randy Peck, Personnel Manager
Michael C. Van Milligen
Masterpiece on the Mississippi
TO: Michael C. Van Milligen, City Manager
FROM: Randy Peck, Personnel Manager RP
SUBJECT: Acceptance of the Renewal Rates for Worker's Compensation Claims
Administration
DATE: October 13, 2010
On October 12, 2010 I received the renewal rates from Alternative Services Concepts (ASC) for
services related to the administration of the City's Worker's Compensation Program. The effective
date of the renewal rates is October 1, 2010. The following is a comparison between the current
rates and the renewal rates:
- Current Rate Rate
Service per Claimant Fee per Claimant Fee Increase/Decrease
Workers' Compensation
• Medical Only $165
• Indemnity
Incident Reports
Catastrophic Claims
Estimated Claims Fee
Account Administration Fee
Litigation Fee
Subroqation Fee
kl:
Systems Fee
Field Medical Case Management
Maintenance Fee for Claims
Open after 24 Months
Fees
i
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Minimum and Deposit Claims Fee
$760
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$2 500
$25,520
$170
$770
$450
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$27,760
$20, 340
$300 Plus Base
Fee
$2,500
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+$5
+$10
$0
and Expense
+$320
+$50
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Medical only claims will increase from $165 per claim to $170 per claim and indemnity
claims will increase from $760 per claim to $770 per claim. The litigation fee will increase
from $250 plus the base fee to $300 plus the base fee. Fixed medical case management
will increase from $68 per hour to $75 per hour. The minimum deposit and claims fee will
increase from $25,520 to $27,760. The only other change has to do with the options that
would be available to us should we cancel the contract. Should we cancel our contract with
ASC they would no longer manage claims based on their time and expense. The
requested action is for the City Council to approve the renewal rates for our workers
compensation claims administration effective October 1, 2010 through October 30, 2011.
I wU -Year ..iams rtanalin •
Service
Estimated Number
Of Claimants
Per - Claimant
Fee
Estimated
Total Fee
Workers' Compensation
Medical Only
20
$170
$3,400
Indemnity
22
$770
$16,940
Litigation fee
TBD
$300 + base fee
Run -In Claims
Indemnity
TBD
$450
- --
Medical Only
TBD
$50
- --
Incident Reports
TBD
$ 40
- --
Catastrophic Claims
TBD
Time & Expense
- --
Estimated Minimum Claims Fee
$20,340
MMSEA- AnnualTransmission
Fees(includes query & submissions
$1,920
Account Administration Fee
$3,000
Systems Fee
$2500
Minimum & Deposit Claims Fee
$27,760
•
alternative service concepts, L.L.C.
City of Dubuque, Iowa
October 1, 2010 - October 1, 2011
Claims will be handled for two years from the date the loss is reported to asc with
no additional per claim fee. Any claim remaining open after 24 months will be subject
to an annual maintenance fee of $450.00
Notes
ASC will handle the number of claims indicated for the minimum claims fee. If the fee for
the actual number of claims is more than the minimum claims fee, ASC will invoice the
client for the difference.
1 Recorded in claims system only. Must be specified as "Incident" at time of reporting.
2 Any event resulting in 10 or more claimants and/or property losses over $50,000 will be treated as a catastrophe.
The account administration fee will be 7.5% of the claims fee or $3,000, whichever is
greater. The administration fee includes:
• Account Setup
• New Claire Setup
• Client Meetings (Frequency to be Determined)
• Excess Reporting
• State Reporting
• Storage Fees
At the conclusion of the contract, the following options are available for continued
handling of open claims:
• Negotiated annual fee per claim
• Claims returned to client
Subrogation
All parties will automatically be placed on notice if the potential for subrogation exists.
Pursuit of subrogation will be performed at the client's request. Pursuit of recovery fee
is 15% of recovery.
Additional Services and Fees
Client Data Transmission
Carrier Data Transmission
State - Mandated EDI
Computer Compatible Checks & Electronic
Data Conversion From Prior Administrator
On -Line Access (One User)
Additional Users
$2500 Per Release
$400 Per Release
$3 Per Report/Bill
Transfers At Cost
At Cost
No Charge
$60 Per User Per
Month
No Charge
$50 Per Copy
T &E ($85 Per Hour)
T &E ($ /Hour)
$6.25 Per Report
$50 Per Hour
T &E ($85 Per Hour)
T &E ($85 Per Hour)
Reports Produced by Client
Reports Produced by asc
Systems Training
Customized Programming
Index Bureau Reporting
Actuarial Data Requests
Travel Over 100 Miles
Outside Investigation
Medical Cost Management
Fee Scheduling 28% of Savings
PPO Usage 30% of Savings
Field Medical Case Management $75 Per Hour
Invoicing and Payment Terms
Fees will be invoiced annually. Fees are payable upon receipt of the invoice. asc
reserves the right to charge 1 per month or the maximum legal rate on unpaid
balances after 30 days.
Allocated Expenses
Allocated expenses will be charged to the claim file and include fees for:
• Legal services • Professional photographs
3 As required or requested Most services are optional.
4 Pricing for additional managed care services is available upon request.
• Medical records
• Index Bureau reporting
• Architects, contractors
• Police, fire, coroner, weather reports
• Surveillance
• Extraordinary travel at client's request
• Independent medical examinations,
MRIs, etc.
• Experts' / rehabilitation services
• Accident reconstruction
• Engineers, chemists
• Expert witness statements
• Official documents and transcripts
• Court reporters
• Managed care
Workers' Compensation Definitions
Medical Only Claims - Work - related claims that require medical treatment only.
• Subrogation not required
• Investigation sufficient to determine claim type and compensability
• Lost days do not exceed statutory waiting period
• No loss notices, captioned reports, client meetings, or settlement authority required
• Payments do not exceed $2,500
• Two -point contact made
Indemnity Claims - Work - related claims that involve disability or payment of medical and
other expenses in excess of $2,500. Claims that require investigation for subrogation
and settlement negotiations.
All claims, regardless of type, will be investigated, evaluated, and adjudicated in
accordance with state statutory requirements and corporate guidelines.