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Alternative Concepts Renewal Rates_Workers' CompensationMasterpiece on the Mississippi Dubuque band AI- America City 1 2007 • 2012 • 2013 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 11, 2013 Personnel Manager Randy Peck recommends City Council approval of the renewal rates from Alternative Services Concepts for services related to the administration of the City's Worker's Compensation Program. Alternative Services Concepts is proposing no increase in their fees for the contract period effective October 1, 2013 through September 30, 2014. I concur with the recommendation and respectfully request Mayor and City Council approval. Michael C. Van Milligen MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Randy Peck, Personnel Manager Masterpiece on the Mississippi Dubuque * ** All•AmericaCitV ils 2007 TO: Michael C. Van Milligen, City Manage FROM: Randy Peck, -P- ersonnei Manager tF SUBJECT: Acceptance of the Renewal Rates for Worker's Compensation Claims Administration DATE: October 7, 2013 On October 4, 2013, I received the renewal rates from Alternative Services Concepts (ASC) for services related to the administration of the City's Worker's Compensation Program. ASC is proposing no increase in their fees for the contract period of October 1, 2013 to September 30, 2014. The requested action is for the City Council to pass a motion approving the renewal rates for our workers compensation claims administration effective October 1, 2013 through September 30, 2014. I will send you the Administrative Services Agreement as soon as it is available. RP:lmh alternative service concepts, L.L.C. City of Dubuque, Iowa October 1, 2013 - October 1, 2014 Two -Year Claims Handling Service Estimated Number Of Claimants Workers' Compensation Medical Only Indemnity Litigation fee Run -In Claims Indemnity Medical Only Incident Reports' 7 22 Catastrophic Claims2 Estimated Minimum Claims Fee MMSEA- AnnualTransmission Fees(includes query & submissions) TBD Per - Claimant Fee Estimated Total Fee $170 $780 $300 + base fee $1,190 $'7,160 TBD TBD Account Administration Fee Systems Fee Minimum & Deposit Claims Fee TBD TBD $450 $50 $ 40 Time & Expense $18,350 $2,100 $3,000 $2,500 $25,950 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 clahns 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 Claim 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 Fees3 Client Data Transmission $2500 Per Release Carrier Data Transmission $400 Per Release Computer Compatible Checks & Electronic Transfers At Cost 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 Co Systems Training T &E ($85 Per Hour) Customized Programming T &E ($ /Hour) Actuarial Data Requests $50 Per Hour Travel Over 100 Miles T &E ($85 Per Hour) Outside Investigation T &E ($85 Per Hour) Medical Cost Management4 hee Scheduling 28% of Savings PPO Usage 30% of Savings 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 • Medical records • Experts' / rehabilitation services • Index Bureau reporting • Accident reconstruction 3 As required or requested. Most services are optional ' Pricing for additional managed care services is available upon request. • Architects, contractors • Police, fire, coroner, weather reports • Surveillance • Extraordinary travel at client's request • Independent medical examinations, MRIs, etc. • Engineers, chemists • Expert witness statements • Official documents and transcripts • Court reporters • Managed care State Mandated l~DI Reporting - $3.00 per report/bill Workers' Compensation Definitions Medical Only Claims - Work - related claims that require medical treatment only. • Subrogation not requited • 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.