1995-026-RES WHEREAS, CITY COUNCIL DID ON JANUARY 9, 1995 ACCEPT THE BID FROM HEALTHCARE
RESOLUTION NO. 95-026
WHEREAS, the City Council of the City of Paris, did on January 9, 1995, accept the
bid from Hea1thCare Benefits, Inc. for the furnishing and delivery of Term Life Insurance,
Stoploss Insurance, Third-Party Administrative Services, and a Maintenance Drug Program for
employees of the City of Paris; and,
WHEREAS, W. E. Anderson, Director of Finance of the City of Paris, did execute
contracts for such insurance coverage and services on January 18, 1995, which execution should,
in all things, be ratified; NOW, THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PARIS, that the
execution of the contracts, attached hereto as Exhibit A, with HealthCare Benefits, Inc. by W.
E. Anderson, Director of Finance of the City of Paris, on the 18th day of January, 1995, be,
and the same is hereby, ratified.
PASSED AND ADOPTED this 13th day of February, 1995.
Eric S. Cliffor ,
ro-tem
ATTEST:
Mattie Cunningham, City CI
HBI-ASA/1l-93
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ADMINISTRATIVE SERVICES AGREEMENT
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EXH1BlI A
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ADMINISTRATIVE SERVICES AGREEMENT
THIS AGREEMENT is made and entered into by and between HeaIthCare Benefits, Inc., a corporation
organized, existing and doing business under and by virtue of the laws of the State of Texas (hereinafter
referred to as "Contractor") and City of Paris (hereinafter referred to as "Purchaser").
WITNESSETH:
WHEREAS, Contractor is in the business of providing independent third-party administration of employee
welfare benefit programs; and
WHEREAS, Purchaser desires to engage the service of a third-party administrator for a welfare benefit
program (hereinafter referred to as "Benefit Program ") to be provided to Purchaser's employees and their
eligible dependents (hereinafter collectively referred to as "Participants"); and
WHEREAS, Contractor is willing to provide such services to Purchaser and other parties on an independent
contract basis.
NOW, THEREFORE, for and in consideration of the mutual promises, covenants and Agreements
hereinafter set forth, the parties hereto agree as follows:
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SECTION ONE
OBLIGATION OF PURCHASER
1.01 Purchaser shall furnish Contractor with a detailed description of the Benefit Program to be
administered.
1.02 Purchaser, in consultation with Contractor, shall determine the administrative practices and
procedures to be followed in the processing and payment of claims.
1.03 Purchaser shall provide to Contractor a complete and current listing of all Participants
eligible to receive benefits prior to their date of eligibility--making timely changes to the
listing on a periodic basis.
1.04 Purchaser shall obtain the consent of Participants for the release of confidential medical
information required for administration and to process claims for the payment of fees for
medical services rendered to patients, including any fees for mental or emotional health
services performed by professionals, as may be required by state or federal law.
1.05 Purchaser shall establish and maintain a suitable banking arrangement to effectuate the
provisions of Section Six herein.
1.06 At Contractor's request, or at Purchaser's option, Purchaser shall make the final
determination of eligibility of Participants to receive benefits and any special issues
arising in the course of administration.
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1.07 Purchaser shall designate in writing a contact person who will be empowered to act on
behalf of Purchaser with regard to the terms of the Agreement and with whom Contractor
can coordinate and resolve all questions arising in the course of administration.
SECTION TWO
OBLIGATION OF CONTRACTOR
2.0 I Contractor shall administer Purchaser's Benefit Program in accordance with the benefit
plan description provided and the administrative practices and procedures established.
2.02 Contractor shall provide or arrange for suitable facilities, equipment and personnel
necessary for proper administration of the Benefit Program.
2.03 Contractor shall, upon request, assist Purchaser is establishing appropriate banking
arrangements for program administration.
2.04 Contractor shall provide standard administrative materials, including enrollment forms,
participant and provider claim forms and two identification cards for each participant in
the Benefit Program on the Effective Date of the Plan. The cost of reprinting additional
identification cards shall be the obligation of the Purchaser.
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2.05 Contractor shall, upon request, assist Purchaser in incorporating the Benefit Program
description and design into a plan document and booklet for Participants. The Contractor
will provide one benefit booklet per participant enrolled in the Benefit Program on the
Effective Date ofthe Plan. The cost of reprinting additional benefit booklets shall be the
obligation of the Purchaser.
2.06 Contractor shall supply the initial check stock, thereafter the cost of additional checks
shall be the obligation of the Purchaser.
2.07 Contractor shall provide claims processing services to include:
a. Review and validation of all claims submitted for payment;
b. Determination of benefits in accordance with the specification of the Benefit
Program;
c. Coordination of benefits with other plans, where appropriate;
d. Preparation and mailing of explanation of benefit forms; and
e. Preparation and mailing of claim drafts drawn on Purchaser's bank account as
provided in Section Six herein.
2.08 Contractor shall establish liaison with Purchaser's designee, providers and Participants,
as required, to obtain and follow-up on additional service information, to verify eligibility
of Participants and to assist in resolving claims problems.
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2.09 Contractor shall provide periodic written reports to include:
a. Monthly check reconciliation report;
b. Monthly benefit experience reports; and
c. Those reports specified in Item Four of the current Exhibit to this Agreement, if
any.
2.10 Contractor will provide Purchaser copies of specific claim payment drafts upon request.
2.11 Contractor shall evaluate late applicants for evidence of good health on behalf of Purchaser.
2.12 Contractor shall maintain current individual benefit records on all Participants and shall
maintain the confidentiality of any medical information contained in such records.
2.13 Contractor shall prepare IRS form 1099 reports on medical provider fees.
2.14 Contractor shall keep Purchaser informed with respect to non-routine "shock" claims and
matters of general interest, including recurring administration problems, local situations
meriting review and possible misuses of benefits.
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2.15 Contractor shall refer to Purchaser any claim or class of claims Purchaser may specify for
consideration and final decision, to include:
a. Claims for services which do not appear to qualify for payment under the Benefit
Program;
b. Claims in which there is a question on the amount of payment due;
c. Claims involving any matter in controversy; and
d. Those claims or classes of claims specified in Item Three of the current Exhibit to
this Agreement, if any.
2.16 Contractor shall assist Purchaser in the analysis and resolution of disputed claims,
provided, however, that such assistance shall in no way include or be considered to
include or constitute legal advice or opinions.
2.17 Underwriting services will not be provided unless specifically identified in Item Two of
the Exhibit to this Agreement, if any. Any such services provided will include required
certifications by a qualified actuary.
2.18 Contractor shall also provide those services specified in Item Two of the current Exhibit
to this Agreement, if any.
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SECTION THREE
RELATIONSHIP OF PARTIES
3.0 I Contractor shall not be construed, represented or held out to be a partner, associate, joint
venturer or employee of Purchaser nor shall the Contractor be construed, represented or
held out to be an agent of the Purchaser or agent of any insurance company. Contractor
shall at all times have the status of an independent contractor.
3.02 Contractor shall, upon request, assist purchaser in obtaining Stop Loss Reinsurance. If
Stop Loss reinsurance is purchased, Contractor shall not be responsible for claims not
timely-filed and not included within the Stop Loss coverage. Contractor shall attempt to
assist Purchaser in encouraging providers to file claims timely but Contractor assumes no
responsibility for the timely filing of such claims, and Purchaser commits not to sue
contractor regarding any claims arising out of Stop Loss reinsurance coverage so purchased.
3.03 Contractor is not a statutory fiduciary of Purchaser's Benefit Program nor is Contractor a
plan administrator within the meaning of the Employee Retirement Income Security Act
of 1974, Public Law 93-406.
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3.04 This Agreement is not a contract of insurance, and Contractor is not an insurer or
underwriter of Purchaser's liability under the Benefit Program. Purchaser has and retains
the ultimate responsibility for payment of claims and other expenses under the Benefit
Program.
SECTION FOUR
TERM AND TERMINATION
4.01 The term of this Agreement shall be for the period of one (I) year commencing on the
Effective Date specified herein and shall continue in full force and effect from year to
year thereafter unless terminated as provided herein.
4.02 This Agreement may be terminated as follows:
a. By either party on any anniversary of the Effective Date of this Agreement
following thirty (30) days' prior written notice to the other;
b. By Contractor upon Purchaser's failure to fund the bank account as provided for
in Paragraph 6.02 of Section Six below;
c. By Purchaser for cause, upon fifteen (15) days' prior written notice, if Contractor
fails to correct any deficiency in the performance of its obligations under the
Agreement within fifteen (15) working days after notice of such deficiency is
given to Contractor by Purchaser in writing; or
d.
By both parties on a mutually agreeable date.
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4.03 If this Agreement is terminated by Purchaser, except as provided in Paragraph 4.02,
above, Purchaser agrees to pay to Contractor a termination fee in an amount equal to
twice the average of the monthly administration fee due for all months immediately
preceding termination. Such termination fee is due and payable within thirty (30) days
after notice of termination, or immediately upon termination if no notice is given, and is
in addition to any monthly administration fee, or portion thereof, or any other monies due
and payable to Contractor under this Agreement.
4.04 If this Agreement is terminated for cause by Purchaser under Paragraph 4.02, above, the
Purchaser shall not be liable for any termination fees or charges. Moreover, Purchaser
may withhold from the current administration fees due Contractor, the costs incurred by
Purchaser in attempting to gain Contractor's performance of the Agreement.
SECTION FIVE
ADMINISTRATION FEES AND REIMBURSEMENT
5.01 Purchaser agrees to pay Contractor a monthly administration fee which shall be due and
payable in full on or before the first (1st) day of each month at its home office in
Richardson, Texas, during the term of this Agreement.
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a. In the event payment of the monthly administration fee is not paid by the twentieth
(20th) day of the month, Contractor may suspend its performance under this
Agreement without notice until such fees and late charges are paid.
b. After the twentieth (20th) day of the month, a late charge may be assessed each
day for late payment of all monies owed to Contractor by Purchaser under this
Agreement. The late charge shall be charged as interest and equal to ten percent
(10%) of the past-due amount owed, or the maximum amount permitted by state
law, whichever is less.
c. After the thirty-first (31st) day the Contractor may terminate this Agreement for
non-payment of fees.
5.02 The amount of the administration fee shall be determined in accordance with the
specifications contained in Item One ofthe current Exhibit to this Agreement, if any.
5.03 The administration fee shall be subject to change by Contractor as follows:
a. On each anniversary of the Effective date of this Agreement, upon thirty (30)
days' prior written notice to purchaser;
b. On the implementation date of any changes in the Benefit Program which would
increase Contractor's cost of administration;
c. On any date that increased expenses are incurred by Contractor because of
changes imposed by governmental entities--limited to increases sufficient to
recover the additional expenses; or
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d. On any date that Benefit Program enrollment changes by an amount equal to ten
percent (10%) or more of total enrollment.
5.04 Purchaser shall reimburse Contractor for the direct cost of any special supplies or forms
provided by Contractor for Purchaser--such reimbursement to be in addition to the
monthly administration fee.
5.05 Purchaser will reimburse Contractor for any taxes imposed or adjudged due by any lawful
authority with respect to the Benefit Program or its administration. In the case of
imposition of such tax liability, Purchaser may elect to terminate this Agreement upon
thirty (30) days' prior written notice without incurring liability for termination fees or
charges.
SECTION SIX
CLAIMS PAYMENT AND BANKING ARRANGEMENT
6.01
Purchaser shall establish a bank account on which Contractor shall write drafts for the
payment of Benefit Program claims and expenses. Purchaser agrees and is obligated to
arrange for sufficient funds to be available in such account to cover all drafts validly
issued against the account. Contractor shall notify Purchaser, simultaneous with the
release of checks, the amount that is required to be deposited by Purchaser to cover the
checks issued.
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6.02 Contractor shall have the right to terminate this Agreement upon notice to Purchaser in
the event that Purchaser fails to fund such account within three (3) banking days after
notice is given by Contractor that such funds are required to be deposited.
6.03 Notice by Contractor, as contemplated in paragraph 6.02, above, shall be sufficient if
given by telephone, fax or by United States mail, delivery services or personal delivery
to Purchaser's designee or the signatory to this Agreement at the telephone number or
address specified in Item Five of the current Exhibit to this Agreement, if any. Any
telephonic notice given will be confirmed in writing within twenty-four (24) hours.
SECTION SEVEN
NOTICES
7.0 I All notices given under in this Agreement, unless otherwise provided for herein, must be
in writing and shall be deemed to have been given for all purposes when personally
delivered and received or when deposited in the United States mail, first-class postage
prepaid, certified or registered, return receipt requested and addressed to the parties as set
forth in Item Five of the current Exhibit to this Agreement, if any.
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SECTION EIGHT
INDEMNIFICATION AND HOLD HARMLESS
8.01 To the extent permitted by applicable law, Purchaser shall indemnify, hold harmless and
defend Contractor, its officers, directors, employees and agents against any and all
liability, obligations, risks, expenses, costs, damages, losses or judgements, (including
reasonable attorneys' fees) and against any and all claims or actions based upon, arising
out of, or in any way connected with the services rendered by Contractor pursuant to the
terms of this Agreement--except for willful misconduct or gross negligence in the
performance of said services by Contractor, its officers, directors, employees or agents.
8.02 To the extent permitted by applicable law, Contractor, its officers, directors, employees
and agents shall not be liable for any indirect, special, consequential or incidental damages
in connection with or arising out of services provided hereunder, and Contractor shall not
be liable to Purchaser, or anyone else claiming a right by way of any relationship with
Purchaser, for any acts or omissions in the performance of services by Contractor
contemplated hereunder, except when such acts or omissions are due to Contractor's
willful misconduct or gross negligence.
SECTION NINE
GENERAL PROVISIONS
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9.01 ASSIGNMENT. No part of this Agreement, or any rights, duties or obligations described
herein, shall be assigned or delegated without the prior express written consent of both
parties. Contractor's acquisition and use of facilities, services, supplies, equipment and
the use of temporary personnel on site shall not constitute an assignment under this
Agreement; provided, however, that the supervision of all services provided under this
Agreement will be performed by Contractor's regular employees.
9.02 GOVERNING LAW. This contract shall be governed by and shall be construed in
accordance with the laws of the State of Texas.
9.03 MODIFICATION. This Agreement shall not be amended or modified in any manner
except by an instrument in writing executed by the parties.
9.04 CAPTIONS. Captions appearing in this Agreement and its Exhibits, if any, are provided
for convenience only and in no way define, limit, construe or describe the scope of
sections or paragraphs to which they are inserted.
9.05 GENDER AND MODE. The use herein of a personal pronoun in the masculine or
feminine gender or in the singular or plural mode, shall be deemed to include the opposite
gender or mode unless the context clearly indicates the contrary.
9.06 EXHIBIT. "Exhibit" means the attached document(s) setting out certain particulars of this
Agreement, or any replacement document(s) mutually agreed to by the parties.
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9.07 LEGAL CONSTRUCTION. Should any provision(s) contained in this Agreement be held
to be invalid, illegal or otherwise unenforceable, the remaining provisions of the Agreement
shall be construed in their entirety as if separate and apart from the invalid, illegal or
unenforceable provision(s), subject to renegotiation by the parties if a material change in
the terms of the Agreement were to result.
9.08 ENFORCEMENT. Any delay or inconsistency in the enforcement of any part of this
Agreement shall not constitute a waiver of any rights with respect to the enforcement of
this Agreement at any future date, nor shall it limit any remedies which may be sought
in any action to enforce any provision of this Agreement.
9.09 FORCE MAJEURE. Neither party shall be liable for any failure to perform its obligations
under this Agreement if prevented from doing so by a cause or causes beyond its
commercially reasonable control, including, but not limited to, acts of God or nature,
fires, floods, storms, earthquakes, riots, strikes and wars or restraints of government.
9.10 ENTIRETY. This Agreement and any Exhibits or amendments and advertisement for
bids shall constitute the entire Agreement between the parties and shall supersede any and
all prior Agreements or understandings, either oral or in writing, between the parties
respecting the subject matter herein.
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9.11 DISCLOSURE STATEMENT. Purchaser acknowledges that a disclosure of all payments
to be made to Contractor has been made to Purchaser and such disclosure statement is
incorporated herein by reference.
IN WIlNESS HEREOF, the parties hereto have executed this Agreement for an Effective Date of February
1,1995.
FOR CITY OF PARIS, PURCHASER:
2J.~-~
Title: fJl\OJ'Itc: Dire.Q;\or
fit '(,..._
(Date)
FOR HEALTHCARE BENEFITS, INC., CONTRACTOR:
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Jackie Hamilton
Vice President - HealthCare Benefits, Inc.
1/16/95
(Date)
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EXHIBIT NUMBER ONE
Specifications For
ADMINISTRATIVE SERVICES AGREEMENT
Between
HEALTHCARE BENEFITS, INC. (CONTRACTOR)
and
CITY OF PARIS (pURCHASER)
These specifications are to apply beginning with the Effective Date of the Agreement between the parties
to which this Exhibit is attached and shall continue in force and effect until the Agreement is terminated or
this Exhibit is superseded in whole or in part by a later executed exhibit.
ITEM ONE
ADMINISTRATION FEE
As provided in Paragraph 5.02 of Section Five of the Agreement, for the first (1st) year this Agreement is
in effect, the monthly administration fee shall be an amount equal to ten and 75/100 dollars ($10.75)
multiplied by the number of Participants enrolled in the Benefit Program on the first (I st) day of each month,
of which the Purchaser's appointed agent is to receive none and 0011 00 dollars ($0.00).
ITEM TWO
OTHER SERVICES
As provided in Paragraph 2.18 of Section Two of the Agreement, the following additional services shall be
furnished:
A. Inpatient Certification Program will be administered by Blue Cross Blue Shield of Texas, Inc. acting
as agent of Contractor.
ITEM THREE
SPECIAL CLAIMS PROCESSING
As provided in Paragraph 2.15d of Section Two of the Agreement, the following special claims handling
procedures shall be followed: ~.
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ITEM FOUR
OTHER REPORTS
As provided in Paragraph 2.l0c of Section Two of the Agreement, the following additional reports shall be
furnished: ~.
ITEM FIVE
NOTICE ADDRESS
As provided in Paragraph 7.01 of Section Seven of the Agreement, notice to Contractor shall be delivered
or mailed to:
HealthCare Benefits, Inc.
1201 South Shennan, Suite 200
Richardson, Texas 75081
Written notice to Purchaser shall be delivered or mailed to:
City of Paris
135 SE First
Paris, Texas 75460
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Fax notice to Purchaser shall be made to the following number:
(903) 785-8519
FOR CITY OF PARIS, PURCHASER:
v.G_~
Title: H nance. Director
Yteh:.-
(Date)
FOR HEALTHCARE BENEFITS, INC., CONTRACTOR:
~~~~
ckie Hamilton
Vice President - HealthCare Benefits, Inc.
1/16/95
(Date)
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CONTACT PERSON
Purchaser shall designate in writing a contact person who will be empowered to act on behalf of Purchaser
with regard to the terms of the Agreement and with whom Contractor can coordinate and resolve all
questions arising in the course of administration.
FOR CITY OF PARIS, PURCHASER:
2J..L_~
Title: F.-,.,.,.,.o. t1.-,~~r.r
I/( J(, ."-
(Date)
DESIGNATED PERSON EMPOWERED TO ACT ON BEHALF OF PURCHASER:
b.L~
Title: ;:=-:'''''' J..-.. :re c.T'-.r
f; 1'/.,.:r
(Date)
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The undersigned acknowledges receipt of the information contained herein prior to any purchase and
approves the proposed transaction on behalf of the plan without receiving, either directly or indirectly, any
personal compensation in connection with the purchase of policies under this Plan.
FOR CITY OF PARIS, PURCHASER:
P.Z~
Title: r,;.....- 0 ~; "".~
t"y, r
(Date)
FOR HEALTHCARE BENEFITS, INC., CONTRACTOR:
1/16/95
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ackie Hamilton
Vice President - HealthCare Benefits, Inc.
(Date)
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ADDENDUM TO ADMINISTRATIVE SERVICES AGREEMENT
This Addendum to Administrative Services Agreement is made to provide a vehicle for detennining
and providing for hospital discounts for hospital care rendered to the employees and eligible dependents of
City of Paris (hereinafter called Purchaser).
In consideration of the mutual covenants contained in this Addendum, the Purchaser and HealthCare
Benefits, Inc. (hereinafter called "Contractor") have executed this Addendum.
SECTION I. EFFECTIVE DATE
This Addendum shall be effective as of February I, 1922" and shall continue in force until tenninated as
provided herein.
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SECTION 2. DEFINITIONS
2.1 Defined tenns in the Administrative Services Agreement between the Purchaser and the Contractor
shall have the same meaning for the purposes of this Addendum, unless othelWise indicated herein.
2.2 For the purposes of this Addendum the following tenns shall have the following meanings:
a. "Hospital" means any institution that operates pursuant to the laws of the state in which it is
located, that primarily and continuously provides medical care and treatment of sick and injured
persons on an inpatient basis, and that has facilities for medical and surgical diagnosis and treatment
by or under the supervision of a staff of doctors and that provides 24-hour a day nursing service
under the supervision of registered graduate nurses.
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b. "Contractinl! Hosoital" means any Hospital with which an Agreement has been executed
providing for discounts available to the Contractor, which has an effective date on or after January
1, 1992, and which continues in effect during the term of this Addendum.
c. "Covered Service" means a Contracting Hospital health care service which qualifies for the
application of payment under the terms of the Plan.
d. "Covered Service Amount" means the amount eligible for reimbursement under the Plan for
any Hospital health care service or supply provided to Participants for which benefits are provided
by a Contracting Hospital pursuant to the Plan after application of applicable co-payments and
deductibles, which amount is based on the regular rate charged by the Hospital for such services
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or supplies. "Covered Service Amount" includes only those hospital admissions which commence
after the effective date of this Addendum which are paid by Contractor while this Addendum is
in force and effect.
e. "Discount" shall mean the difference between Covered Service Amount and the amount which
the Hospital requires to be paid for those Services as determined in accordance with its applicable
Discount Agreement.
SECTION 3. APPLICA nON OF DISCOUNT
3.1 The Contractor shall perform claims administration services pursuant to the Administrative
Services Agreement between the parties. Subject to Section 5 hereof, all applicable Discounts
allowed to the Contractor shall be applied to Covered Service Amounts which are incurred in
connection with the admission of a Participant to a Contracting Hospital and which occur while
this Addendum is in force and effect and while a Member Hospital Agreement is in effect with
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the Hospital providing the care.
3.2 The full amount of the Discount allowed to the Contractor on Contracting Hospital Covered
Service Amount under the Purchaser's Plan shall be allowed to the Employer for hospital
admissions commencing or beginning after the effective date of this Addendum and paid while
this Addendum is in force and effect.
3.3 The Contractor reserves the right to make payment of Covered Service Amounts directly to the
Hospital or the Participant. The Employer represents and warrants that during the term of this
Addendum, the terms of its Plan will provide for such discretion in determining the direction of
payment (including, but not limited to, the inclusion of a provision that a Participant may not
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assign rights to receive payment under the Plan) that it will provide evidence satisfactory to the
Contractor of inclusion of such provisions in its Plan promptly at the request of the Contractor,
and that should any change or amendment to its Plan be made which would alter, limit or
terminate such discretion, the Employer will notify the Contractor forthwith.
3.4 Where a payment for Covered Services is subject to coordination of benefits between two or more
payors and the Plan is not the primary payor, the Discount shall be limited to those portions of
Covered Service Amounts which are identified as the Purchaser Plan's responsibility pursuant to
coordination of benefit rules contained in the Purchaser Plan or any applicable Texas statute or
regulation. No Discounts shall be available on claims for Covered Services where Medicare is
the primary payor.
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3.5 The Contractor shall prepare and provide to the Purchaser on a quarterly basis a report ("Discount
Report") which shall include the following infonnation:
1.
Total Contracting Hospital Covered Service Amounts
$....
2.
Total Allowed to Contracting Hospitals
(Less) -....
3.
Total Amount of Discount
$....
The report will not be hospital specific and will be on an overall quarterly hospital savings basis.
3.6 The Contractor shall in no case be required to provide infonnation pursuant to this Addendum,
in its Discount Report or otherwise, which is hospital-specific or which discloses or may lead to
the disclosure of the specific amount of Discount available from any hospital.
SECTION 4. COMPENSATION OF THE CONTRACTOR
4.1 In addition to all sums required to be paid to the Contractor under the Administrative Services
Agreement, the Purchaser shall pay to the Contractor an additional monthly sum equal to $2...iQ per
employee.
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4.2 Such additional monthly sum shall be guaranteed for 12 months and then subject to increase upon
30 days' notice.
4.3 Such payment shall be made by the Purchaser to the Contractor within 20 days of the first of each
month. It is hereby acknowledged and agreed that the Contractor may, at its sole option, draw its
compensation hereunder directly from the Purchaser's Claims Payment Account.
SECTION 5. TERMINATION
5.1 This Addendum shall terminate on the earliest to occur ofthe following:
(A) At the option of the Contractor, on the date the Purchaser fails to make payment to the
Contractor of the compensation due under this Addendum. The Contractor shall
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immediately communicate its election of this option to the Purchaser, and such termination
shall be effective immediately on the Purchaser's receipt of notification or made retroactive
to the first day of the period for which compensation was due but not received by
Contractor.
(B) If the Purchaser breaches the warranty or fails to comply with the obligations contained
in Section 3.3 of this Addendum or any other terms and conditions hereof, this Addendum
shall automatically terminate, without notice, effective as of the date of the breach or
failure to comply.
(C) On the effective date of any state or other jurisdictions action which prohibits the
activities under this Addendum of either of the parties.
(D) On the effective date of termination of the Adrninistrative Services Agreement between
the parties.
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(E) On any other date mutually agreeable to the Purchaser and the Contractor.
(F) At the end of90 days' advance notice given by either party.
5.2 On termination of this Addendum, the Discount shall be applied only to claims for Covered
Service Amounts paid by the Contractor prior to the effective date of termination.
5.3 In the event the Purchaser becomes no longer entitled to the Discount pursuant to the provisions
of this Addendum, the Purchaser shall reimburse the Contractor for the full amount of any
Discount applied to any claims from the effective date of termination. This provision shall
survive the termination of this Addendum.
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SECTION 6. CONFIDENTIALITY
The Purchaser acknowledges that all information concerning the Contractor's business operations,
Participants' Claims and any Discount information it may receive is confidential. It shall keep and
maintain all such information in strict confidence. In the event the Purchaser becomes subject to
compulsory process to disclose such information, it agrees to resist such disclosure and agrees to give the
Contractor immediate oral and written notice of such process.
SECTION 7. ARBITRATION
Any controversy arising out of or relating to this Addendum, or breach hereof, shall be settled by binding
arbitration in Dallas, Texas, in accordance with the rules of the American Arbitration Association then in
effect, and judgement upon the award may be entered in any court having jurisdiction thereof. The
provision in this section shall survive the termination of this Addendum.
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SECTION 8. MERGER
8.1 All terms and conditions of the Administrative Services Agreement included in the Indemnification
Hold Harmless Agreement are incorporated herein; however, in the case of conflicts, the terms of
this Addendum shall apply.
8.2 This Addendum comprises the entire Addendum between the parties with regard to the subject
matter hereof and supersedes any and all prior discussions, negotiations, Addendums or
representations, either oral or in writing, with regard to the subject matter hereof.
: ,j
IN WITNESS WHEREOF, the parties have caused this Addendum to be executed by affixing the
signatures of duly authorized officers.
HEALTHCARE BENEFITS, INC.
CITY OF PARIS
By9~ ~~~
Jackie Hamilton
By2.z.~
for Contractor
for Purchaser
Title Vice-President
Title ~... <:..9 tr~
Date 1/16/95
Date
}fP/'1 r
7
, ;111
THE CONTINENTAL INSURANCE COMPANY
(a stock company)
Administrative Offices:
180 Maiden Lane
New York, NY 10038
APPLICATION FOR EXCESS REIMBURSEMENT POLICY
A CLAIMS REIMBURSEMENT POLICY
1. Full legal name of Insured (Employer, YOU)
CITY OF PARIS
(As I t will appear in the Pohcy)
135 SE 1st PARIS
(Street) (City)
CITY GOVERNMENT
TEXAS
(State)
75460
(ZIp)
Principal Office
2.
Nature of Business
3. If this Policy is to cover the Employer's liability for employee benefit plans of subsidiary or affiliated companies (companies
under common control through stock ownership, contract, or otherwise), attach the legal names and addresses of such
companies and the nature of their business.
4. A. If presently self-insured, full name of Employer's Employee Benefit Plan:
CITY OF PARIS
B. If presently insured:
Insurer:
Policy #:
Description of such plan(s) as currently amended must be attached to this Application. If the Plan Document has not
been adopted, an Employer Interim Adoption Agreement must be completed and attached to this Application.
5. COVERAGES REQUESTED
A. SPECIFIC EXCESS INSURANCE
I) Attachment Point: $ 50,000
IX 1 Individual [ 1 Family
2) Limit of Liability: 100% of payments made by Employer in excess of the Attachment Point.
3) Reimbursable Lifetime Maximum: $ 950.000.00
4)
Coverage Form:
[ 1 Incurred in 12 Months
and paid within 12 Months
Incurred in 12 Months
and paid within IS Months
1 Incurred in 12 Months
[ 1 Paid within 12 Months/_ day run-in
[Xl Other: PA Tn
5)
Extension'of Coverage:
X
[ 1 Yes [ 1 No
If yes,
[ 1 Up to 6 months
[ 1 6 to 12 months
B. AGGREGATE EXCESS INSURANCE (A V AILABLE ONLY WITH SPECIFIC)
I) Monthly Factor: $ 269.40
on the first month's actual enrollment.
. Minimum Annual Aggregate Attachment Point will be based
USB JOOOEP 1/92
Page 1 of 2
2) Limit of Liability: 100% of payments made by Employer in excess of the Annual Aggregate Attachment
Point to a maximum of $2,000,000.
3) Coverage Form:
l' ] Standard
[ ] Advanced Funding Option
4) Supplementary Coverages:
Yes No
[X] Dental
[Xl Prescription Drug Plan
[X] Weekly Income-Maximum per Policy Year: $5,200 per covered employee
[X] Other
6. $ 6,213.36 accompanies this Application as the initial premium deposit based on the fmal number of 326 Employees
of which 217 have Dependent Units. This deposit does not bind coverage.
7. Requested Effective Date
02 / 01 / 9S
8. Requested Endorsements
NIA
9. The Employer appoints HEALTHCARE BENEFITS, INC.
to act as its Designated Third-Party Administrator ("TPA").
10. The Employer agrees and understands that the TP A is its agent and attorney-in-fact, and is not the agent of the Company or
its Underwriting Manager. The Employer authorizes the TPA to act on its behalf for purposes of the coverage applied for.
The Employer further agrees and understands that the Company may pay a commission to the TPA or a licensed insurance
broker or agent for placing this coverage.
II. THE EMPLOYER HAS READ THE FOREGOING AND UNDERSTANDS AND AGREES WITH THE TERMS AND
CONDITIONS OF THE COVERAGE APPLIED FOR. THE EMPLOYER REPRESENTS THAT IT HAS FORMED ITS
EMPLOYEE BENEFIT PLAN IN COMPLIANCE WITH AND IN RELIANCE ON THE APPLICABLE PROVISIONS
OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED. THE EMPLOYER
FURTHER REPRESENTS THAT ASSETS OF ITS EMPLOYEE BENEFIT PLAN WILL NOT BE USED TO
PURCHASE THE COVERAGE APPLIED FOR. THE EMPLOYER AGREES THAT THE STATEMENTS IN THIS
APPLICATION OR IN ANY MATERIALS SUBMITIED WITH THIS APPLICATION OR ATIACHED TO IT ARE
REPRESENTATIONS OF THE EMPLOYER AND SHALL BE DEEMED MATERIAL TO ACCEPTANCE OF THE
RISK BY THE COMPANY AND THAT THIS POLICY IS ISSUED BY THE COMPANY IN RELIANCE ON THE
TRUTH AND ACCURACY OF SUCH REPRESENTATIONS.
Signed at
Paris, Texas
(City, State)
, the 18thday of
January
,1995
Witness
Lisa Wright
(Print or Type Name)
Wt1 } (A !JUr
Slgnat e
Employer:
CITY OF PARIS
By:
h.c-0~
Signature
Title: Director of Finance
THIS APPLICATION DOES NOT BIND COVERAGE. Upon approval of the application, the Policy evidencing that the
coverage is in force will be issued by the Company through its Underwriting Manager, US Benefits, Inc. Coverage will
commence on the Effective Date set forth in the Policy.
USB lOOOEP 1/92
Page 2 of2
US BENEFITS, INC"
LARGE CLAIM DISCLOSURE
1. To the best of our knowledge there are no employees or dependents with
current serious medical conditions with the following exceptions:
Individual
Date Amount
Disabled Paid
Diaqnosis
proqnosis
1.
2.
3 .
2. Please provide the following information for any employee or dependent
who has had claims in excess of $15,000 (or 50% of specific, if less)
during the last two years.
Individual
Emo/Deo
Date Amount
Disabled Paid
Diaqnosis
status
1.
2.
3.
4.
Third Party Admn.:
HEALTHCARE BENEFITS, INC.
By
Date
Name of company:
CITY OF PARIS
Signed By:
Title
Date
Please use the back of this form if additional space is required.
3/93