HomeMy WebLinkAboutReso 82-071 - Authorizing application to the State of Worme's Compensation Self-Insurance, termination of City's Contract with State Compensation Insurance Fund and execution of a contract with Fitzpatrick self-insurance administration ., .
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RESOLUTION NO. g��
A RESOLOTION OF THE CITY COUNCIL OF THE CITY OF REDDING
AUTHORIZING APPLICATION TO THE STATE FOR WORKMEN' S
COMPENSATION SELF-INSURANCE, TER2dINAiION OF CITY' S CONTRACT
WITH STATE COMPENSATION INSURANCE FUND, AND EXECUTION OF A
CONTRACT WITH FITZPATRICK SELF-INSURANCE ADMINISTRATORS.
wHEREAS, it has been recommended by staff that the
City terminate its contract with State Compensation Insurance
Fund, become self-insured, and contract with Fitzpatrick Self-
Insurance Administrators, Inc. as the company which appears to
offer the best services at the most reasonable cost, and
WHEREAS, the City Council has studied said recommenda-
tions and deems approval to be in the best interests of the City,
NOW, THEREFORE, BE IT RESOLVED that the City Council
hereby: .
1. Authorizes the Personnel Officer to apply to the
State of California for a Certificate of Consent to Self-Insure,
and to notify State Compensation Insuance Fund of intention to
terminate contract, and to otherwise act on behalf of the City
with regard to this matter; and �
2. Authorizes the Mayor to execute the attached contract
with Fitzpatrick Se1f=Znsurance Administrators to handle the City' s
workmen' s compensation claims.
I HEREBY CERTIFY that ,the foregoing Resolution was intro-
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duced and read at a regular meeting of the City Council of the
City of Redding• on the . 17•th day of''. May , 1982, and was duly
, adopted;at`said meeting by the following vote: �
AYEs: � 'COUNCiLKEN: Demsher, Fulton, Kirkpatrick, and Gard —4�
NOES: COUNCZliMEN: N002 �
ABSENT: COUNCILMEN: P.UgH �;'
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ATTEST• � ' �
`- = � • BARBARA LLEN GAR .�
ET�f�1� �,��0}�, Mayor of the City of Redding
RICHTER, City Clerk
FO-R�-M RO�VED:
. /7 C2Gcil�il F� � .(^.��c.� i ,
RAN ,ALL A. HAYS, Cit Att � ney
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SELF-INSURED IJORKERS' COhiPEPISATION
SERVICE AGREEMENT � ' '
TH1S AGREEMENT made this 17th day of May, 1982, between the
CITY OF REDDING , hereinafter referred to as City, and
FITZPATRICK SELF-INSURANCE AD�4INISTRATORS, INC. , a California Corporation,
hereinafter referred to as the Adr�inistrator . ._.
� Recitals �
The �City desires to self-insure its liability to its employees
pursuant to the Workers' Compensation Laws of the State of California.
The Administrator is engaged in the business of supervising and
administering Self-Insured 4Jorkers' Compensation Programs for self-insured
� employers.
The City desires to retain the services of the Administrator to
supervise •and administer a Self-Insured l•lorkers' Compensation Program,
hereinafter referred to as the "Prooram" , for the City• .
THEREFORE, the � City'. hereby retains the services of the Administrator
and the Administrator agrees to render its services for the City on the terms
and conditions of this Agreement.
Leqal Status of Administrator
l . The Administrator is a validly existing corporation in the State
of California , with power to o�an property and carry on its business as it is
now beino conducted. �
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2. This Agreement shall become effective as of July 1 , 1982,
and shall continue in effect for a period of t�aelve (12) months , and shall be
annually rene�aable on July 1 of each ear if neither art Written
. Y P Y 9ives/notice
of cancellation by April 1, If the Administrator believes a fee increase
(paragraph 12) is necessary, the City W�11 be notified by the Administrator � '
at least ninety (90) days prior to any fee increase.
Program Development Services to
be Performed b Administrator ----
3. Administratar agrees to perform and provide all the program
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� development services necessary to maintain a Program which achieves the
objectives of cash savings to the City and full benefits to the employees. •
Said serv.ices shall include, but not be limited to, the followino: '
� A. Analyze w.ith personnel of the City� the need for modification
and implementation �of procedures; practices , and coordination to meet the
requirements of the State of California and the needs of the City. �
, B. Develop and provide procedures , practices, and coordination in '
relation to, not by way of limitation, the reporting of industrial injuries , �
the role of the supervisor, r�edical referral , personnel -payroll responsibilities
in processing industrial injuries, and employees consultative services. �
C. Orientate those personnel of the City involved directly in
the processing of industrial cases of the procedure, practices , and coordination
which have been prepared by Administrator. �
D. Design and provide all �forms necessary for the efficient
operation of the program, excluding printed' checks. Said forms shall include,
not by �aay of limitation, documents for the reporting of industrial i.njuries and
illnesses, general processing of t•lorkers ' Compensation matters , doctor's
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. J � ' 'reports, claims admim..lration, coordination of benef�, and fiscal reports.
E. Inform the City in writing of the adoption, amendment, or
repeal of all statutes, rules and regulations , and decisions of administrative
agencies which could directly or indirectly affect the Prooram.
F. Provide advice and assistance to the City regarding future
self-administration of 4lorkers' Compensation claims.
G. Consult and advise the City on any matters arisino in �
connection with the business of the City which involves the subject matter
of this Agreement.
� Administrative and Implementation Services
. to be Performed b the Administrator �
. 4. Administrator further agrees to perform and provide any and all
administrative and implementation services necessary to achieve the desired
objectives of the city . Said services shall include, but not be limited to, � .
the following: . '
. A. Administer the Self-Insurance Program of the City in full
compliance with all laws, rules and regulations governing the administration �
of self-insurance. •
B. Review and process all reports and cases of industrial injury .
� to br disease of employees in accordance with the requirements of the appropriate
State agencies'.
C. Determine the compensability of injuries and illnesses in
accordance with State lJorkers ' Compensation Laws and decide tiahat benefits, if
any, should be paid or rendered in each case.
D. Be the Trustee of the City' s lJorkers ' Compensation checking
account at a bank selected by the City . This responsibility includes
monitoring of fund balance, notifying the . City at least ttoo weeks .prior to
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� any requirement for fund balance replenishment, arranging, for the printing of
�. checks , preparing and ex�uting check payments for medicaf and compensation
� benefits and investigative and legal expenses. The City will replenish the .
account as directed by the Administrator and reimburse the Administrator for
the printing of checks.
E. Effect the payment of inedical benef.its and arrange and authorize
medical examinations to determine the nature .and extent of an alleged disability.
F. Decide the eligibility for and effect payment of temporary
disability compensation, in coordination with medical advice, rehabilitation .
, efforts, and salary continuation programs.
G. Determine the extent and degree of permanent disability,
utilizing, as necessary and desirable, any medical sources or advisory bodies
available, provided however, all the findings shall be reported to the city
before any action is taken.
H. Effect payments of permanent disability compensation and death .
benefits in accordance with Advisory Ratings, Findings and Awards, or settlement
� agreements, all which have been approved by the City in advance.
I. Maintain on each claim, current estimates of the future
anticipated costs of all benefits, i .e. , reserves.
J. Establish and maintain all records and claim files on each
claim which shall be available to the City� at all times for inspection for a
minimum period of five (5) years.
� K. Maintain records on and effect collections from excess
reinsurers on the City ' s behalf where it is entitled to reimbursement for a
loss in excess of the self-insurance retention.
Medical Control Services to
be Performed by Administrator �
5. Administrator further agrees to perform and provide any and all .
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• �� medical control servicc�necessary to ensure a high qu�+•/ty of inedical
treatment for injured employees , prompt and complete medical reports necessary
to the determination of compensability in .the provision of benefits , and the
regulation of inedical costs. Said services shall include, but not be limited
to, the following: �
A. Maintain a. current roster of physicians for the first treatment
of employees with industrial injuries or illnesses requiring long-term of
speciality care. This roster shall be reviewed periodically for quality and
cost of inedical treatment. �
B. Monitor treatment programs for injured employees, including,
not by way of limitation, review of a11 medical reports. Copies of each and
' � every medical report shall be forwarded to the City.
C. Provide continuing medical control of employee injury cases so
� that the employee may be returned to the job as early as is consistent with the
� medical condition.
' D. Audit all medical bills prior to payment to confirm this
� relationship to the disability and accepted fee schedules.
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E. Establish standards for the evaluation of the physical capacity
of the injured emp7oyees to return to work, and provide guidance for the
application of standards in determining the existence of any permanent disability.
F. Make all necessary arrangements for consultation with and
examinations by prominent physicians for the review of the employees' medical
problems. �
G, Supervise the furnishings of inedical treatment to injured
employees. •
H. Administer and process all lifetime medical cases .
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, Claims Investigative Services .
; .. �be Performed by Administrator�- '
6. Administrator further agrees to arrange for all claims
investigative services necessary to conduct a thorough investigation of any
claim or dispute arising out of or related to the Program. Said services shall
include, but not be limited to, the following: '
A. Determine liability of questionable claims and arrange all
necessary investigations as deemed necessary by the City with regard to
individual cases, to confirm whether or not the injury or the illness arose out
of and occurred during the course and scope of employment.
� B. Provide all records , medical files, and other data , and perform
. all tasks and research as the City or designated leaal counsel of the
may request or require concerning any claim, dispute, liability, loss costs, or
obtigation on account of, or arising out of, the Program.
C. Monitor all cases for potential subrogation recoveries and
arrange subrogation investigations. Investigations and other assistance shall
be performed as the City may request or require arhere necessary to effect
collection from third parties. .
. Employee Consultative Services
to be Performed by Administrator . .
� 7. Administrator further agrees to perform and provide any employee
Consultative services necessary to supply employees with full and complete
information and guidance regarding their rights and benefits , and the operation
of the Program. •Said services shall include, but not be limited to, the
following:
A. Provide consultation and recommendations concerning the �
development of policies and procedures for employees ' consultative service
activities.
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� ' � j' B. Supply ii.,ormation and 9uidance to all. �ured employees
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relative to their rights arid benefits. . .
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C. Identify and attempt to solve employee problems arising out of ;
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work-incurred disabilities. `�
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D. Meet with employee groups, at the direction of the City,
to discuss the 4Jorkers ' Compensation system and related matters. =;
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. E. Develop policies and procedures to ensure that the return to ��'
work or reassignment of injured employees is consistent �with the findings of
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. State administrative agencies. , �
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F. Design and provide a "Claim Acknowledaement Letter", or other
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. document, to be used when accepting lost time work-incurred injuries or illnesses.
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G. Assist the City and employees in solving employee non-leaal
problems arising out of industrial injury cases. •i�
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Rehabilitation Services to •.;
be Performed by Administrator � "�
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8.. Administrator further agrees to arrange for any rehabilitation j
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services necessary to develop and main"tain a good, sound rehabilitation system.
Said services shatl include, but not be limited to, the following: �
A. 41ork with the employees , the personnel staff of the City , ��
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� and other groups or agencies to provide for the rehabilitation, retraining, or �
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reassignment of employees with physical or performance limitations arising out '
of industrial injuries. The costs for rehabilitation of employees shall be the
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responsibility of the Ci ty ,
B. Develop and administer'a rehabilitation system for the City
pursuant to applicable State laws , rules , and regulations , and decisions of ;
administrative agencies thereto.
C. Develop and closely monitor plans which are submitted to the . :
, Rehabilitation Bureau. for Vocational Rehabilitation.
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Statistical and Reporting Services_ .
•.�.., `. •� � be Performed b Administrato,y
9. Administrator further agrees to perform and provide any and all
statistical services necessary to maintain control of self-insurance costs and
continue the efficient operation of the Program. Said services shall include,
but not be limited. to, the following:
A. Provide a monthly loss report, on or before the thirtieth (30th)
day of each calendar.month, for the preceding month, containing , not by way of
limitation, the follo�aing information: The location, the description of the
loss, the nature of the injury, the number of days lost from work, OSHA coding,
and reserves and payments made during the given month.
. B. Submit a comprehensive monthly report, for the preceding month,
on or before the thirtieth (30th) day of each succeeding calendar month,
delineating a "year to date" complete run of all incurred reserves and payments.
C. Furnish a complete'monthly breakdown, on or before the thirtieth
(30th) calendar day of each month, of all claims as well as a "year to date"
breakdown by location and department.
D. Maintain a11 records and statistical data on losses arising from .
employee injuries as may be required under the appropriate laws of the State of
California, and rules and regulations thereto.
� E. Supply data and information relative to the establishment of a
reserve dollar amount for each and every claim after Administrator's analysis
of s�id claim, monitor each and every. claim, at a minimum quarterly, to
determine if a change in the reserve dollar•amount is required, and provide an
analysis of the reserve fund at such times as the City may require, in order
to ensure the adequacy of said fund in light of anticipated and accrued costs ,
expenses, and claims .
F. Provide a quarterly narrative status report on all major claims
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with a total expected cost of ten thousand dollars (510,000.00) or more.
G. Provide a comprehensive annual statistical summary survey
report to serve as the basis for evaluation of the. City' s Self-Insurance
Program and to permit preparation of reports reG•aired by the Department of
Industrial Relations. Such report shall be submitted to the City within
six (6) weeks after the close of the period. . .
Litigation Manaaement �
10. Administrator further agrees to perform and provide litigation
management services which shall include, but not be limited to, the following: �
A. Retain , on the City' s behalf, attorneys who specialize in
the defense of Workers ' Compensation litigation, when an employee files an .
Application for Adjudication before the Workers ' Compensation Appeals Board.
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� • B. Inform the City ��ediately of all hearings scheduled
before the Workers' Compensation Appeals Board. �
C. Cooperate fully with the City attorney or any other
attorney enganed on the City' s behalf, and provide all records, medical
files, and provide any non-legal preliminary work as the City ' s counsel may
request.
D. Legal expenses are to be paid by the C ity through the
Trustee Account administered by the Administrator. '
� Qual.ified and Trained.Personnel �
11 . Qualified and trained personnel directly employed and supervised .
by the Administrator rrill perform all the services required by the terms and
conditions of this Agreement. Administrator agrees that each of its employees -,
shall have an extensive background in the l•lorkers ' Compensation field and will
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�, � ` :be properly trained an�ill use reasonable care in th�ierformance of their
duties. .Furthermore, each employee shall be provided with continued education
to ensure that they are up-to-date on recent court decisions, proposed
legislation, and otherwise, and are able to take the necessary action that may
be indicated or required to continue and maintain control of the program.
Compensation of the Administrator
12. As conpensation for services rendered under this Agreement,
Administrator shall be entitled to receive the sum of 50. 144 per 5100. 00
of gross payroll. •
Indemnification
13. . The Administrator shall indemnify, hold harmless, and defend the
City from all liability, loss , damage, or injury arising out of or incident
to the performance of this Agreement, including without limitation, all
consequential damages.
Cancellation �
14. This Agreement may be cancelled by the City and/or
� Administrator at any time with or without cause after six (6) months of service
upon givin� written notice to either party at .least sixty {60) days prior to
the date of termination. � �
� Notices
15. All notices , demands , requests, or approvals which are required
under this Agreement, or �•,hich either City or Administrator may desire to
serve upon the other, shall be in writing and shall be conclusively deemed
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_ �� '.� served when delivered pUonally, or forty-eight (48) h�s after Lhe deposit
thereof in the United States Mail , postage prepaid, re�istered or certified,
addresses are .hereinafter provided. �
• All notices , demands requests or approvals from Administrator to
City shall be addres5ed to City of Reddinq, Personnel Office, 760
Parkview Avenue, Redding, California 96001.
All notices , demands, requests or approvals from City to ,
Administrator shall be given to Fitzpatrick Self-Insurance Administrators , Inc. ,
at P. 0. Box 3698, Ontario, California , 91761 .
.Warranty of Services
16. Administrator warrants and auarantees that all services performed
hereunder for. the Ci ty shall be performed in a �anner commensurate with the
highest professional standards.
Warranty Against Collusion
� and Conflict of Interest
17. Administrator hereby represents , warrants, and agrees as follows:
• A, Neither it nor its agents , servants , or employees has any
financial interest in any insurance company, law firm, or self-insurance
administrator (excluding Administrator) , which could, in any manner, benefit
from the results of Administrator's recommendations.
. B. Neither it nor its aqents, servants , or employees has in the
past received, or is presently receivina, income from any of the above said
organizations . . �
C. Neither it nor its a,ents , servants, or employees has had, or
is presently having, any part in setting or fixin� the prices for insurance,
legal costs , or outside consultina services with reference to the matters
relating to the subject matter of this P.oreement. �
D. Neither it nor its agents , servants , or employees has agreed
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.J � y � with any person with re�d to the' results or proposed Ksults. of the services
contemplated by this Agreement; and any recommendations shall reflect the
totally independent judoment of Administrator.
E. Each provision of this Aoreement and each provision of this
warranty, representation, and agreement is expressly for the benefit of the
parties hereto and any other person, firm, corporation, or class of persons ,
firns , or corporations which could be affected by a violation of said Aoreement,
warranty, or representation.
F. In rendition of its services hereunder, Administrator shall
act solely as an independent contractor and shall not .act or purport to act
as an A9ent with any authority to represent or bind the C ity.
Entire Contract
18. This instrument contains the entire Aareement between the parties
relating .to the rights herein .granted in the obli9ations herein assumed. Any
oral representations or modifications concerning this instrument shall be of no
force or effect except a subsequent modification_ in writing , sianed by the part
to be charged. '
Partial Invalidity
19. If any provision of this Aareement is held by any competent
court to be invalid, void , or unenforceable, the remaining provisions shall
• nevertheless continue in full force and effect. ' '
Governinv Law
20. The .validity of this Agreement and of any of its terris and
provisions, as well as the rights and duties, shalt be interpreted and
construed pursuant to the laws of the State of California . '
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21 . The terms and conditions of this Agreement shall be construed
' pursuant to their plain and ordinary meaning and shall not be interpreted
against the maker. .
Attorney's Fees
22. If any action at law or inequity, including an action for
declaratory relief, is brought to enforce or interpret the provisions of this
Agreement, the City shall be entitled to a reasonable attorney 's fee if it
prevails, which may be set by the court in the same action or in a separate
' • action brought for that purpose, in addition to any other relief to which he
may be entitled.
EXECUTED at Redding , California, on the date and year first
above written.
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FITZPATRICK SELF-I�SURANCE ADMINISTRATORS, IWC. �
By
' Larry K. Fitzpatrick Date
President •
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ATTEST: • CITY OP REDDING
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�.� cc,c�.. — — — — BY
Ethel A. Richter, City Clerk Barbara I�llen Gard Date 5/17/82
t4ayor
FORR APPROVED
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C1TY LEGAL DEP .
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