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Home My WebLink About12/17/2013 General and Auto Liability Third-Party Claims Administrationfivffiount Prospect Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: FINANCE DIRECTOR DATE: NOVEMBER 25, 2013 SUBJECT: GENERAL AND AUTO LIABILITY THIRD -PARTY CLAIMS ADMINISTRATION `6 C:� 0 PURPOSE: To present a recommendation for renewal of the annual service agreement for third - party liability claims administration for the period January 1, 2014 - December 31, 2014. BACKGROUND: To assist in the administration of general and auto liability claims the Village has contracted out the service to a third -party administrator. The Village's current agreement for claims administration expires on December 31, 2013. A new agreement is needed at this time for the current provider to continue to service the Village. DISCUSSION: Gallagher Bassett Services (GBS) is the current service provider for general and auto liability claims administration. The agreement for 2014 contains no changes to the terms and conditions from the prior year. Below is a summary of fees for the prior year and 2014. � Service 2013 Rates . . ............................... 20 14 Rates Claims Admin $1,040 $1,082 Simms Bankin Fee 456 4 Minimum Annual Fee mmmITIT ITITITITITITIT 8,000 Total Fee $9,496 µµm - $9,492 The claims administration fee increased 4.0% from the prior year's program. The Simms Banking fee is an annual flat fee assessed for maintaining the escrow and processing and making payment on claims. This service relieves the Village from having to process payments internally. There was no change in the annual minimum fee from the 2013 program. General and Auto Liability Third -Party Claims Administration November 25, 2013 Page 2 The Village is subject to an $8,000 minimum annual fee. Time and expense charges are invoiced against the annual fee until the balance is exhausted. When the entire annual fee is depleted, the Village will begin making payments for charges incurred in managing the open claims. Our liability ends when all the claims for a particular period are closed. Our experience with GBS continues to be very positive. Communication between the Finance Department, Corporation Counsel and GBS continues to be strong, working to control overall claims costs. Based on our satisfaction with the service provided and no changes to the funding schedule I recommend we continue the relationship with GBS. RECOMMENDATION: It is recommended we approve the agreement for GBS to provide general and auto liability claims administration services during 2014 according to the proposed funding and fee schedule. David O. Erb Finance Director DOE/ Attachment I: \Insurance \GAB -GBS \Renewal - 2014.docx Village of Mount Prospect - #007474 0 4 L. L A G 1/1/2014 - 1/1/2015 PRICING OPTION: TIME & EXPENSE HANDLING *Please see Claim Charges outlined in footnote 7 under Program Specific Terms and Conditions. Claims will be handled on a Time & Expense basis. If you should decide to stop using GB in a specific state, the existing open files will be returned to the client (contingent upon Carrier approval) at the client's expense. There will be additional charges for ongoing Data Management (RISX- FACS risxfacs.com users, Administration, Banking fees and monthly reports for as long as GB handles claims. There may be an additional fee charged by the carrier(s) for data transfers as a pass- through to client. New Business Cost & Terms (Revision date: 6/27/2013) Page 1 This program is quoted at a total minimum of $9,492 (including administration and banking fees). Village of Mount Prospect - #007474 1/1/2014 - 1/1/2015 % 0 1 ,LLAG OTHER SERVICES New Business Cost & Terms (Revision date: 6/27/2013) Page 2 .- risxfacs.com - Additional Users $1,000 per user (full); $500 per user (inquiry) GB International Claims Services Varies by Country (pricing provided upon request) Consultative Services Loss Control Consultinq Services $140 p hou Ap praisa l Services TBD MountainView ClaimZone RMIS Module TBD Fraud Prevention — Gallagher Bassett Investigative Services (GBIS) Special Fraud Inve stigations - SIU $85 per hour plus expenses ...... .............._.� Sur veillance Investigations $70 per hour plus expenses Targe Field Investiqati $80 per hour plus expenses Targeted Database Investiqations Rate per report Medinsi MSA/MSP Compliance Services S Social Security _ _ .............�...�......�.__ Verification (Entitle�ment $175.00 per verification Determination) M edi ca re Li en Evaluation __ ._ Conditional Paym ent Search $250 per search Manual Medicare Eliqibility Inquiry (Rush Request) $35 Condi tional Payment Lien Ne $150 per hour Medical Cost Protection $125 per hour MSA Resolution Unit Service $450 Fee Pharmaceutical Drug Review $450 per review (If PDR doesn't prove to reduce lifetime costs by $5,000 the fee reduced to $35) Medicare Set - Asides Workers Compensation Medicare Set -Aside $2,300 per allocation Allocation (WCM Rush Fees (MSA completed within 7 days) $450 per case mmm Revisions: $150 per hour (One free revision within six months of subm Liabili Medicare Set -Aside Allocation (LMSA) $1,535 Fee ....... MSA Submission to CMS $850 Fee Taxes All applicable taxes will be added to the service fees where required New Business Cost & Terms (Revision date: 6/27/2013) Page 2