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Worker's Comp Adm Services Fee 5U~~E ~~~ MEMORANDUM November 15,2005 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Administrative Services Fee Renewal - Workers' Compensation Personnel Manager Randy Peck is recommending City Council approval of the new administrative services fee submitted by Alternative Service Concepts, our workers' compensation claims administrator. Their fee for medical claims increased from $135 to $145 per claimant; their fee for indemnity claims increased from $645 to $690 per claimant; and the managed medical only increased from $195 to $208. Their per claimant fees for run-in claims will remain the same. The account administration fee will increase from $2,500 to 3,000. The minimum claims fee will increase from $24,400 to $25,325. I concur with the recommendation and respectfully request Mayor and City Council approval. (lkJ ~/ltL Micnael C. Van Milligen MCVM/ksf Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Randy Peck, Personnel Manager ~ , I ., -.' . i5~~~JE ~<k~ Memorandum November 8, 2005 TO: Michael C. Van Milligen City Manager FROM: Randy Peck to f Personnel Manager U' SUBJECT: Administrative Services Fee Renewal - Workers' Compensation I received the renewal rates from Alternative Service Concepts (ASC), our workers' compensation claims administrator. The following is a comparison between their currents rates: Service Current Rate per Claimant Fee Renewal Rate per Claimant Fee Workers' Compensation . Medical Only $135 $145 . Indemnity $645 $690 . Managed Medical Only $195 $208 Run-in Claims . Indemnity $450 $450 . Medical Only $50 $50 Incident Reports $40 $40 Catastrophic Claims Time and Expense Time and Expense Estimated Claims Fee $21,900 $22,325 Account Administration Fee $2,500 $3,000 Minimum and Deposit Claims Fee $24,400 $25,325 Maintenance Fee for Claims Open after 24 Months $400 $450 Increase $10 $45 $13 $0 $0 $0 $425 $500 $925 $50 The Fiscal Year 2006 budget for workers' compensation claims administrative services is $25,034. The renewal rates are in effect from October 1, 2005 through September 30, 2006. I recommend that the renewal rates be approved. The requested action is for the City Council to pass a motion approving the new administrative services fees submitted by Alternative Service Concepts. If you have any questions, please feel free to call. RP:bf 11/08/05 TUB 11:42 FAX 15633555935 ASC 19J002 alternative Service Concepts, L.L.C. City of Dubuque, Iowa October 1, 2005-0ctober 1, 2006 Workers' Compensation Medical Only Indemnity Managed Medical Only Run-In Claims Indemnity Medical Only . Incident Reports 1 Catastrophic Claims' 35 25 TBD $145 $690 $208 $5,075 $17,250 TBD TBD TBD TBD $460 $50 $ 40 Time & Expense Estimated Claims Fee Account Administration Fee $22,325 $3,000 Minimum & Deposit Claims Fee $25,325 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 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 Claim Setup . Client Meetings (Frequency to be Determined) . Excess Reporting . State Reporting At the conclusion of the contract, the following options are available for continued handling of open claims: . Negotiated annual fee per claim . Time and expense at asc's prevailing rates . Claims returned to client I Recorded in claims sY!ftenz only. Must he spec!fied (u "Incident" at lime Q{reporting. ' Any event re.I'lIlting in 10 or m"re cl"imanls alUllor proper~v I"s"es OVer $50,()OO will be trealetl a.' It cCltlt..lrophe. 11/08/05 TUE 11:43 FAX 15633555935 ASC 141003 SUbro~ation All pa les will automatically be placed on notice if the potential for subrogation exists. Pursuit of subrogation will be performed at the client's request. Additional Services and Fees~ CllenlLJata rransmlsslon...................................................................$295 Per Release Carrier Data Transmission.................................................................$400 Per Release State-Mandated EDI..........................................................................$3 Per Report/Bill Data Conversion From Prior Administrator........................................At Cost On-Line Access (One User)...............................................................No Charge Additional Users ...........................................................................$60 Per User Per ..................................................................................................... Month Reports Produced by Client..............................................................No Charge Reports Produced by asc ..................................................................$50 Per Copy Systems Training ............................................................................T&E ($85 Per Hour) Customized Programming ................................................................. T&E ($/Hour) Index Bureau Reporting..................................................................... $6.25 Per Report Actuarial Data Requests.................................................................... $50 Per Hour Travel Over 100 Miles .......................................................................T&E ($85 Per Hour) Outside Investigation and Litigation Management.............................T&E ($85 Per Hour) Medical Cost Management~ t-ee ::;cneaullng....................................................................... 15% of Savings PPO Usage............................................................................. 28% of Savings Field Medical Case Management...........................................$68 Per Hour Allocated Expenses Allocated expenses will be charged to the claim file and include fees for: . Legal services . Professional photographs . Medical records . Experts' / rehabilitation services . Index Bureau reporting . Accident reconstruction . Architects, contractors . Engineers, chemists . Police, fire, coroner, weather reports . Expert witness statements . Surveillance . Official documents and transcripts . Extraordinary travel at client's request . Court reporters . Independent medical examinations, . Managed care MRls, etc. Workers' Compensation Definitions Medical Only Claims - Work-related claims that require medical treatment only. o 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 3 A.5' I"equirect tlr requested. Most ,\'ervi.ces are optional. " Pricing for Ullditional numaged care ,\'ervices i... aVlIilable upon reque.'it. 11/08/05 TUE 11:43 FAX 15633555935 ASC ~004 . . Payments do not exceed $2,500 . Two-point contact made Claims requiring services beyond these guidelines will be classified as Managed Medical or Indemnity. Managed Medical Claims - Work-related claims that require medical treatment only, exceed $2,500 in total payments, and are not indemnity claims. Indemnity Claims - Work-related claims that involve disability or payment of medical and other expenses. 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.