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HomeMy WebLinkAboutES06-062 - Other - Flex-Plan Services, Inc. - COBRA Administrative Services - 10/01/2013 h Records M emO KENT Document WASHINGTON CONTRACT COVER SHEET This is to be completed by the Contract Manager prior to submission to City Clerks Office. All portions are to be completed. If you have questions, please contact City Clerk's Office. I QVendor Name: Vendor Number: JD Edwards Number t Contract Number: Ss Vy igm- This is assigned by City Clerk's Office , Project Name: Description: ❑ Interlocal Agreement ❑ Change Order ❑ Amendment ontract ❑ Other: Contract Effective Date: 0 Termination Date:Ur U Contract Renewal Notice (Days): �� Number of days required notice for termination or renewal or amendment YA,"� Contract Manager: Department: Detail: (i.e. address, location, parcel number, tax id, etc.): S Public\RecardsManagement\Forms\ContractCOver\adcc7832 1 11/08 9 COBRA ADMINISTRATIVE SERVICES AGREEMENT This Administrative Services Agreement("Agreement')between Flex-Plan Services,Inc ("Flex-Plan")and City of Kent ("Employer"),effective October 1,2013,specifies the services to be provided by Flex-Plan for the Employer's group health Plan continuation requirements under COBRA. RECITALS WHEREAS,the Employer maintains one or more group health Plans that the Employer has determined are subject to the group health Plan continuation requirements of Federal law,commonly known as"COBRA", s WHEREAS,the Employer desires to engage Flex-Plan to provide administrative services and assist the Employer to comply with the requirements of COBRA; NOW,THEREFORE,in consideration of the foregoing and the terms conditions set forth in this document,the Employer and Flex-Plan agree as follows 1 Definitions 1.1. "Agreement"means this Administration Agreement,its Addenda and Schedules,as any of them may be amended from time-to-time 1.2. "Carrier"means(a)any company that acts as an insurer or(b)a self-insured Plan. 1.3. "Certificate of Creditable Coverage" means the certification described in ERISA§701(e),Internal Revenue Code§9801(e)(1)(A),and Public Health Services Act§2701(e)(1)(A),and the regulations thereunder 1.4. "COBRA Group Application"means the"COBRA Group Application" provided to the Employer for completion by the Employer prior to the initial account setup by Flex-Plan. 15. "COBRA"means the group health plan continuation coverage provisions set forth in section 4980B of the Internal Revenue Code of 1986,sections 601 thru 608 of ERISA,sections 2201 through 2208 of the Public Health Services Act,and the regulations promulgated thereunder. 16 "Continuation Coverage"means the extended group health plan coverage required by COBRA. 17 "Election Notice"means the notice of the right to elect Continuation Coverage the Plan administrator provides to Qualified Beneficiaries as required by COBRA. 1.8. "ERISA"means the Employee Retirement Income Security Act of 1974,as amended. 19 "General Notice" means the general notice of continuation coverage that the Plan administrator provides to covered employees and covered spouses as required by COBRA. 1.10. "COBRA Grace Period"means the period within which the Monthly Contribution Amount(s)must be paid in full by or on behalf of a Qualified Beneficiary "COBRA Grace Period"includes the 45-day period that begins when a Qualified Beneficiary elects Continuation Coverage(within which the initial contribution of required COBRA Monthly Contribution Amounts must be made) Thereafter,unless the Employer directs otherwise,the COBRA Grace Period for any month of Continuation Coverage is the period that ends 30 days after the first day of that month 1.11."HIPAA"means the group health plan portability provisions or the administrative simplification provisions,as applicable,of the Health Insurance Portability and Accountability Act of 1996,as amended,and the regulations thereunder 1.12. "HITECH"means Subtitle D of the Health Information Technology for Economic and Clinical Health Act,Title XIII of Public Law 111-005(42 U S.0 A Section 17921 et seq,subchapter III,Privacy)and the regulations thereunder 1.13 "Monthly Contribution Amount"means the amount that must be contributed by or on behalf of a Qualified Beneficiary for a month of Continuation Coverage 1 r , f•, s 1.14 "Notice of Qualifying Event"means the notice provided by a covered employee or Qualified Beneficiary to the Plana dministrator of a Qualifying Event that is attributable to a divorce,legal separation,or dependent child's loss of dependent status,as required by COBRA 115 "Notice of Termination"means the notice of termination of continuation coverage described in Department of Labor Regulation§2590 606-4(d). 116 "Plan"means the group health Plan(s)subject to COBRA the Employer identifies in writing to Flex-Plan 1 17 "Protected Health Information"means Protected Health Information as described by HIPAA and its supporting rules and regulations 1.18 "Qualified Beneficiary(ies)"means the qualified beneficiary within the meaning of COBRA,generally a covered employee,a covered employee's spouse or former spouse,or a covered employee's dependent child who has lost coverage under the Plan due to one of the events described in COBRA and is either eligible for Continuation Coverage or has elected Continuation Coverage(which has not terminated) 119 "Qualifying Event"means a qualifying event within the meaning of COBRA 120. "Schedule A"means the page titled Schedule A—Selected Services and Fees in this Agreement that itemizes the standard services,fees and charges,for a designated period of time,provided by Flex-Plan to the Employer,as well as any optional services that are available to and/or chosen by the Employer,subject to the terms and conditions of this Agreement 2. General Provisions 21 The Employer must submit a completed and signed COBRA Group Application at least 60 days in advance of the Effective Date. 22. The Employer acknowledges that it is the"Employer,""Plan sponsor,"and'Plan administrator"of the Plan for purposes of COBRA,ERISA,the Internal Revenue Code and the Public Health Services Act,and that the Employer retains the full responsibility under the law for its and the Pla n's compliance. 23. The Employer shall also have final authority on all questions,including matters of clerical error,or concerning Qualified Beneficiaries'eligibility for Continuation Coverage under the Plan 24 The Employer has the absolute authority with respect to the control,management,investment,or disposition and utilization of all Plan assets,if any;and Flex-Plan shall neither have nor be deemed to exercise any discretion,control,or authority with respect to the disposition of any Plan assets. 25. The Employer,the Plan,the Plan's administrator,their agents or assigns,and not Flex-Plan,is solely responsible for the review and payment of claims for benefits under the Plan and all Plan appeals under ERISA, including,without limitation,with respect to claims,benefits and eligibility determinations under the Plan 26. The Employer shall establish reasonable procedures for the furnishing'of certain COBRA notices by a covered employee or Qualified Beneficiary as required by Department of Labor Regulation§2590 606-3(b) The reasonable procedures shall require all covered employees and Qualified Beneficiaries to provide to Flex-Plan (on behalf of the Plan administrator)all four COBRA notices governed by the Department of Labor's COBRA notice regulations(i e,the Notice of Qualifying Event,notice of disability determination,notice of occurrence of a second qualifying event,and notice of change in disability status)within the minimum notice periods permitted under COBRA Among other things,this regulation requires the Employerto timely distribute an ERISA-compliant summary plan description that includes these reasonable procedures to employees covered by the Plan and to Qualified Beneficiaries The form and contents of these reasonable procedures must be consistent with the responsibilities assigned to the Employer and to Flex-Plan under this Agreement 2 t , 2.7. The Employer has the responsibility to pay,or to cause to be paid,all excise taxes required under Internal Revenue Code section 4980B,as and when required,and to file,or to cause to be filed,IRS Form 8928,as and when required 28 The Employer will promptly furnish to Flex-Plan such records and information in its possession or control as Flex-Plan may request to perform its obligations under this Agreement The Employer has full responsibility and holds Flex-Plan harmless if incorrect information is provided to Flex-Plan by the Employer,its employees or its representatives,including Carriers This includes,but is not exclusive to,COBRA Monthly Contribution Amounts 29 In performing its duties and responsibilities pursuant to the Agreement,Flex-Plan acts as the agent of the Employer and at the direction of the Employer Flex-Plan is not the"Plan administrator"or a"named fiduciary" (as those terms are defined in ERISA,the Internal Revenue Code,or the Public Health Services Act)with respect to the Plan. 2.10.Flex-Plan has no responsibility for the payment or reimbursement of any health care claims under the Plan. 2.11 Flex-Plan's duty and responsibility is limited to assisting the Employer with compliance with the Employer's responsibilities under COBRA Any other requirements imposed by the Employer or the Plan(s)are not the responsibility of Flex-Plan 212 Flex-Plan is not"a person who is responsible...for administering or providing benefits under the Plan"within the meaning of Internal Revenue Code section 4980B(e)(1)(B) Flex-Plan is not responsible for the payment of excise taxes imposed under Internal Revenue Code section 4980E and is not responsible for the preparation or filing of Internal Revenue Service Form 8928 Flex-Plan shall provide such information as Employer reasonably requests in order to calculate excise taxes imposed under Internal Revenue Code section 4980B or to prepare IRS Form 8928 2 13.Unless otherwise notified in writing,Flex-Plan will be entitled to conclusively presume that a Qualified Beneficiary's eligibility for Continuation Coverage under the Employer's Plan(s)has not terminated by reason of coverage under another group health Plan or by becoming eligible for Medicare. 2.14.Flex-Plan is authorized to modify its internal procedures or processes in order to comply with COBRA or other applicable rules and regulations or to obtain administrative efficiencies Any changes that impact the processes or responsibilities of the Employer will be communicated in a timely manner. 215 Flex-Plan shall maintain and archive all pertinent data for as long as the Agreement is in effect Upon termination of the Agreement,Flex-Plan will return any Plan materials subject to the terms described in the Termination Section 216 With the exception of a change in fees as described in Fees and Charges Section,this Agreement may be amended only in writing and signed by an officer of each party. 2.17.Failure by the Employer or Flex-Plan to insist upon compliance with any provision of the Agreement at any time or under any given set of circumstances shall not operate to waive or modify such provision or in any manner render it unenforceable,as to any other time or as to any other occurrence,whether or not the circumstances are the same. 3 218 No waiver of any of the terms and conditions of this Agreement shall be valid unless contained in a written memorandum and signed by an officer of the waiving party. 219 This Agreement is the final and complete Agreement between the parties on the subject matter hereof and supersedes all prior or contemporaneous negotiations or Agreements,written or oral,regarding such subject matter 220 No assignment by any party pertaining to this Agreement shall be valid without the consent of the other party 221 Unless superseded by Federal law,the laws of the State of Washington shall govern this Agreement 222 The scope of Flex-Plan's services as rt relates to the COBRA services includes Qualified Beneficiaries who are receiving COBRA coverage at the Effective Date of this Agreement,as well as Qualified Beneficiaries who experience Qualifying Events on or afterthe Effective Date of this Agreement 2.23.This Agreement is not intended to confer,and does not confer,upon any non-party(including any covered employee or Qualified Beneficiary)any rights or remedies Any covenant,representation,or warranty made by Flex-Plan in this Agreement is made to Employer alone. Any covenant,representation,or warranty made by Employer in this Agreement is made to Flex-Plan alone 2.24.All Protected Health Information as defined under HIPAA will be handled in a manner consistent with the privacy and security requirements under HIPAA. Protected Health Information will be used only for the purpose of fulfilling Flex-Plan's responsibilities under this Agreement and as permitted or required by law. 2.25. No action under this Agreement or with regard to the services Flex-Plan provides under this Agreement may be brought by the Employer more than two years after the cause of action has accrued. 3. COBRA Administrative Responsibiki-es of Employer and Flex-Plan Initial Account Setup Employer 3.1 The Employer must identify in writing to Flex-Plan each separate Plan and its contractual rates for which Flex- Plan is to provide services at least 60 days in advance of the Effective Date unless otherwise agreed 3.2. The Employer must identify in writing to Flex-Plan each Qualified Beneficiary and their elected Plans for which FPS is to provide services at least 60 days in advance of the Effective Date unless otherwise agreed 3.3 If the Employer receives a COBRA election form from a Qualified Beneficiary who was provided an Election Notice before the Effective Date of this Agreement,the Employer will immediately forward the election form and enrollment information to Flex-Plan to facilitate the collection of COBRA premium payments Flex-Plan 34. Flex-Plan will establish the Employer's Plans in its various systems and will confirm accuracy of the COBRA Monthly Contribution Amounts established with the Employer 3.5. Flex-Plan shall send a notice of administrative change to all Qualified Beneficiaries who are receiving Continuation Coverage on the Effective Date and direct that their COBRA premium payments and notice of eligibility or enrollment changes be sent to Flex-Plan 4 COBRA Notice Data Submission by Employer Employer 36 The Employer will submit COBRA general and election notice data to Flex-Plan using the Flex-Plan online internet service The Employer may use other methods such as email,fax,or Excel spreadsheet,with the approval of Flex-Plan and subject to an additional fee as detailed on Schedule A. 3.7. The may Employer and Flex-Plan agree to establish electronic communications for the submission of COBRA Y g General Notice and Election Notice data This may require specialized computer programming time and Flex- Plan reserves the right to charge a specialized computer programming fee or data entry fee as detailed on Schedule A Election Notice,Election Procedures,and COBRA Administration Employer 38 The Employer will provide the required notice data to Flex-Plan within 30 days of the date of Qualifying Event that is due to 3.8.1 Termination of an employee's employment; 3 8 2 Reduction in an employee's hours that results in a loss of coverage under the Plan; 3 8 3 Employee's death,or 384 Employee's entitlement to Medicare that results in a loss of coverage under the Plan for the employee's spouse or dependent child 3.9. If the Employer does not provide Flex-Plan the complete required notice data until after the 30-day period expires,Flex-Plan will provide the Qualified Beneficiaries their Election Notices within 14 calendar days after receiving the data,but subiectto the following condition if a Qualified Beneficiary timely elects Continuation Coverage,the Employer will have sole responsibility(a)for any adverse consequences(including,for example, a Carrier's refusal to provide coverage or a stop-loss insurer's refusal to reimburse claims because the Carrier or insurer deems the Employer to have provided untimely notice under COBRA)and(b)for ensuring the availability of Continuation Coverage to the Qualified Beneficiary for the maximum coverage period under COBRA 3.10.The Employer will promptly notify Flex-Plan in writing when the Employer receives any notice or communication from a covered employee,Qualified Beneficiary or any other person relating to Continuation Coverage(including Notice of Qualifying Event,notice of occurrence of second qualifying event, notice of disability determination and notice of change in disability status),and shall promptly forward to Flex-Plan copies of all notices or other communications 3.11 The Employer will provide HIPAA Certificates of Creditable Coverage. 3.12.The Employer will notify Flex-Plan,in writing and in a manner acceptable to Flex-Plan,of the rates for Monthly Contributions Amounts and will do so at least 30 days before their effective date If the Employer notifies Flex- Plan of new rates less than 30 days before their effective date,Flex-Plan may defer implementing the new rates to the first day of the first month that occurs more than 30 days after the Employers notification to Flex- 5 Plan If the Monthly Contribution Amount is age-based or gender-based,the Employer must notify Flex-Plan of any change in the Monthly Contribution Amount that is based on a change in that rating category. 313 The Employer will notify the Carrier(s)of any COBRA coverage elections,terminations,or changes in status unless the Employer elected one of the Carrier direct options as denoted on Schedule A and described on Addendum 1 If the Plan or Carrier requires Monthly Contribution Amount payment information within a specific timeframe,it is the Employer's responsibility to independently obtain the information from the Employer's online account and to provide it to the Plan or Carrier. 314 The Employerwill provide each Qualified Beneficiary all required enrollment materials(whether in connection with the Plan's open enrollment,a HIPAA special enrollment,or any other enrollment opportunity),unless the Employer elects on the COBRA Group Application(or by written request to Flex-Plan after the Effective Date), that Flex-Plan provide each Qualified Beneficiary the enrollment materials that the Employer provides to Flex- Plan for distribution to Qualified Beneficiaries,subject to additional fees as denoted on Schedule A If the Employer elects to have Flex-Plan provide enrollment materials,the Employer must(a)designate the date by which Flex-Plan must mail the enrollment materials(the"marling date")and(b)provide the enrollment materials to Flex-Plan in their complete form at least 15 business days before the mailing date The Employer has the full responsibility for determiningthe marling date,and Flex-Plan shall have no responsibility for the timeliness of enrollment materials that Flex-Plan mails on or before the mailing. For example,if the Employer includes a Summary of Benefits and Coverage in the enrollment materials,the Employer,not Flex-Plan,is responsible for determining a mailing date that will satisfy the deadline for providing the Summary of Benefits and Coverage 3.15.The Employer will promptly notify Flex-Plan in writing when the Employer becomes aware of address changes of its employees,their spouses,and/or dependent children who are receiving Continuation Coverage 3.16.The Employer will promptly notify Flex-Plan in writing if it becomes aware that Qualified Beneficiary who is receiving Continuaton Coverage, 3 161 has become entitled to Medicare; 3 16 2 has become covered by another Employers group health plan; 3 163 has been determined to be disabled by the Social Security Administration; 3.16 4. has been determined to be no longer disabled by the Social Security Administration; 3 16 5 has become divorced or legally separated,or 3 16 6 no longer is a dependent child according to the terms of the Plan. 3.17.The Employer will promptly notify Flex-Plan in writing when its Plan is no longer subject to COBRA Flex-Plan 3.18 Flex-Plan will receive the Notice of Qualifying Event,notice of disability determination,notice of occurrence of a second qualifying event,and notice of change in disability status that a covered employee,Qualified Beneficiary,or representative acting on behalf of either may provide to the Plan administrator under COBRA. 3.19.Within 14 calendar days following Flex-Plan's receipt of complete COBRA data from the Employer for a Qualifying Event that is either termination of employment,reduction in hours,covered employee's death,or entitlement to Medicare that results in a loss of coverage,Flex-Plan will issue an Election Notice to the Qualified Beneficiaries 6 320 If Flex-Plan receives a complete Notice of Qualifying Event relating to a divorce,legal separation or a child's loss of dependent status that the Employer,covered employee,Qualified Beneficiary or representative acting on behalf of either has provided within the minimum 60-day notice period that is the later of the date of the qualifying event or the date coverage under the Plan is lost,Flex-Plan will issue an Election Notice to the Qualified Beneficiaries within 14 calendar days If a complete Notice of Qualifying Event is provided after the 60-day notice period has expired, Flex-Plan will not provide the Election Notice and will issue a notice of unavailability to the Qualified Beneficiaries. 3.21 If Flex-Plan receives a complete and timely notice of disability determination by the Social Security Administration that the covered employee,Qualified Beneficiary or representative acting on either's behalf has provided within the minimum 60-day notice period and before the expiration of the initial 18 month period of Continuation Coverage,then Flex-Plan will permit the extension of Continuation Coverage authorized under COBRA If the notification is provided after the 60-day notice period or after the first 18 month period of Continuation Coverage,Flex-Plan will not permit the extension of Continuation Coverage and will issue a notice of unavailability to the Qualified Beneficiaries 3.22 If Flex-Plan receives a complete and timely notice of a second Qualifying Event that the covered employee, Qualified Beneficiary or representative acting on either's behalf has provided within the minimum 60-day notice period,then Flex-Plan will permit the extension of Continuation Coverage authorized under COBRA If the notification is provided after the 60-day notice period has expired,Flex-Plan will not permit the extension of Continuation Coverage and will issue a notice of unavailability to the Qualified Beneficiaries 3 23.Flex-Plan shall track all COBRA deadlines. 324 Flex-Plan shall provide all required COBRA notices to the Qualified Beneficiary as required by COBRA.Flex-Plan, at its election,may also issue notices relating to COBRA or Continuation Coverage to Qualified Beneficiaries(or any other person or their representative)that are not required by COBRA and are not subject to this Agreement Furthermore,the issuance of a non-required notice does not establish precedence for the future issuance of a particular notice. 3 25.Flex-Plan shall notify the Employer of any COBRA elections,termination or changes in enrollment within 10 business days from receipt Flex-Plan shall not be obligated to notify the Plan,or Carriers,of the eligibility status of any active or terminated Plan participants or Qualified Beneficiaries unless a Carrier Direct option is selected on the COBRA Group Application as denoted on Schedule A and described on Addendum 1. 3 26.If Flex-Plan is notified that an event has occurred during the period of Continuation Coverage that permits the termination of Continuation Coverage before the otherwise applicable maximum continuation period would expire,Flex-Plan shall provide the Notice of Termination. Monthly Contribution Amount Collection,Accounting and Distribution Employer 3.27.The Employer will remit the COBRA Monthly Contribution Amounts to the Plan(if the Plan is self-insured)or to the Carrier(s)(if the Plan is insured)and notify the Plan or Carrier(s)of the eligibility status of any Qualified Beneficiaries 7 3 28.The Employer acknowledges that,in order to maintain Plan coverage in effect during the COBRA Grace Period, it may have to advance its own funds prior to Flex-Plan releasing the COBRA Monthly Contribution Amounts, which occurs approximately 15 working days following the close of the prior month's accounting period In no event is Flex-Plan responsible for reimbursing the Employer for any funds the Employer may have advanced to the Carriers. Flex-Plan 3 29 Flex-Plan,as agent of and on behalf of the Employer,shall collect COBRA Monthly Contribution Amounts paid by or on behalf of Qualified Beneficiaries Should the Employer orany other third party assume responsibility to pay COBRA Monthly Contribution Amounts for a Qualified Beneficiary,such payments must be remitted to Flex-Plan in the same manner as any other Monthly Contribution Amount 3.30.Flex-Plan may deposit all COBRA Monthly Contribution Amounts it receives in a commingled non-interest bearing"holding"account. At least once a month Flex-Plan shall transfer the COBRA Monthly Contribution Amounts from a holding accountto a non4nterest bearing bank account from which Flex-Plan shall remit payments to the Employer as required or permitted under this Agreement.Flex-Plan will maintain an accounting of the Month3y Contribution Amounts in the bank account that are allocable to the Plan,adjusted for the remittances and for the reduction for fees 331 Flex-Plan shall remit monthly to the Employer the net COBRA Monthly Contribution Amounts,reduced by the two percent admnistr eve fee allowed under COBRA and any applicable service fees detailed on Schedule A.If the Plan's Monthly Contribution Amount does not include the two percent administrative fee,Flex-Plan will invoice the Employer rrrorithly for the allowable two percent 332.Unless otherwise directed by the Employer,Flex-Plan will not accept COBRA Monthly Contribution Amounts made after the Grace Period expires. 333 Flex-Plan will administer partial payment of a Monthly Contribution Amount in a manner consistent with Treasury Regulation§54 4980B-8,Q&A-5(d)that relates to premium payment shortfalls 3 34 Specia I payment procedures applicable to Qualifiers Beneficiaries: 3 341 Flex-Plan will not accept NSF checks(paper or virtual checks,returned for insufficient funds,stop payment or closure of account)as payment of the Monthly Contribution Amount If a check is returned NSF within the Grace Period,Flex-Plan will send its standard form letter requesting payment within the Grace Period of a Monthly Contribution Amount via cashier's check or money order There is a replacement processing fee of$25 00 3.35.No special handling fee applies when the Monthly Contribution Amount is paid with a virtual check through the Flex-Plan website Month-End Eligibility Reports,Premium Reports and Account Reconciliation Employer 3.36.The Employerwill audit all month-end reports that Flex-Plan provides the Employerfor accuracy and promptly report any errors or discrepancies to Flex-Plan within 14 days of receipt of the reports Any failure by the Employer to report any errors or discrepancies will absolve Flex-Plan of any liability associated with the same. 8 337 If the Employer is reporting eligibility to the Carrer(s),any failure by the Employer to report any COBRA elections,terminations or changes in status included in the month-end reports to the Carner(s)will absolve Flex-Plan of any liability associated with the same 338 If Flex-Plan is forwarding eligibility updates directly to the Carrier(s)as selected on the COBRA Group Application(Carrier direct option 1)and denoted on Schedule A and described in Addendum 1,it is the Employer's responsibility to perform the Account Reconciliation of the eligibility updates forwarded by Flex- Plan to the Carrier(s)with any billing type statements received or maintained by the Employer. Flex-Plan 3.39.Flex-Plan will provide daily summary reports through the Employer's online account and monthly activity reports,either online or as hard or soft copies,within a reasonable period of time following the end of the prior month's activity. Miscellaneous 4. Audits Employer(or its designated agent)may perform no more than one(1)audit of the records specifically related to performance of the parties under this Agreement each contractual year,subject to reasonable prior written notice to Flex-Plan Audits must be performed during Flex-Plan's normal working hours and the data being reviewed can be no older than 24 months before the date of the request for an audit Flex-Plan may require Employer or an agent of Employer to sign a confidentiality agreement provided by Flex-Plan Each party agrees to provide reasonable assistance and information to the auditors.Employer acknowledges and agrees that if it requests an audit,it will reimburse Flex-Plan for Flex-Plan's reasonable expenses,including copying and labor costs, in assisting Employer to perform the audit Each party also agrees to provide such additional information and reports,as the other party will reasonably request. Flex-Plan will be held harmless if any requested audit information is no longer accessible due to Flex-Plan's inability to access an Employer or Carrier-provided eligibility submission system for any reason,including the expiration of passwords or other credentials In addition,any eligibility updates provided to the Employer or Carrier by Flex-Plan are conclusively presumed to have successfully reached the Employer or Carrier unless Flex-Plan receives a failed-delivery notification via fax or email 5 Fees and Charges Charges for the services provided under this Agreement shall be in accordance with the schedule set forth in Schedule A. If adequate funds are not available in the Employer's COBRA account(the bookkeeping account to which Monthly COBRA Contribution Amounts are allocated)to cover Flex-Plan's monthly administration fees,the Employer will pay the fees agreed to by Flex-Plan and the Employer within 30 days of the billing date Following the initial fee guarantee period,Flex-Plan may propose changes to Schedule A by providing a minimum of 30 days written notice to the Employer,enclosing a substitute Schedule A The substitute Schedule A shall take effect the first day of the month followingthe 30-day notice The Employer has the right to terminate the Agreement prior to the effective date of the substitute Schedule A by giving written notice to Flex-Plan If written notice of termination is not received prior to the effective date of the changes,the new fees will go into effect Employer agrees to reimburse Flex-Plan for the amount of any taxes,or other charges,in connection therewith,assessed against Flex-Plan or for which Flex-Plan has been made a collection agent with respect to the services provided under this Agreement 9 Flex-Plan may retain COBRA Monthly Contribution Amounts collected up to the amount of any fees owed to Flex-Plan if the Employer fails to pay any required fee or charge within 30 days of the billing date The billing date is the date of the invoice If the Employer uses the services of Flex-Plan,this Agreement will be deemed to be in effect even if a copy has not been signed and returned by the Employer,and all fees and monthly charges will be due and payable as setforth on in Schedule A. 6. Indemnification Employer will indemnify and hold Flex-Plan,its officers,managers,directors,and employees harmless against claims, liabilities,damages,or penalties(collectively"claims')to the extent the claims are caused by Employer's acts or omissions that are dishonest,fraudulent or illegal,in bad faith or reckless,or the Employer's intentionally wrongful performance or nonperformance of obligations under this Agreement Flex-Plan is not responsible for any special,incidental,or consequential damages even if Flex-Plan has knowledge of the possibility of such potential loss or damage. Flex-Plan is not responsible for failure to provide services if due to any cause or condition beyond the reasondble control of Flex-Plan 7. Termination This Agreement will continue in effect fora minimum period of twelve monthsfrom the original Effective Date of this Agreement and shall be automatically renewed for additional one-year periods,unless terminated earlier pursuant to the terms of this Agreement This Agreement will terminate upon the earliest of the following events: a. Upon written notice by either party at least 60 days before the date termination is to be effective, b. Upon written notice by the Employer prior to the effective date of a substitute Schedule A, b. At Flex-Plan's election upon the Employer's failure to pay any required fee or charge within 30 days of the billing date,wKYch is the date of the invoice, C. At Flex-Plan's election«when.changes to COBRA or other federal or state law that necessitates a change in procedure that requires issuance of a new Agreement or addendum, d. If either the Employer or Flex-Plan does not materially meet its obligations as set forth in this Agreement within 30 days after receiving written notice of a breach then the other party shall have the immediate right to provide written notice of termination of this Agreement The Employer's obligation to pay all fees that have accrued to the date of termination shall survive the termination of the Agreement e. If the Employer has entered into a separate agreement with another party to pay the fees and charges invoiced by Flex-Plan that party is named on section 5 of this Agreement If the designated party does not pay the fees and charges billed by Rex-Plan within 30 days of the date of the invoice,Flex-Plan will cease to provide all services under this Agreement until a replacement Agreement is signed by the Employer and the fees are current The Employer will be responsible for up to two months of unpaid fees under this Agreement Flex-Plan may suspend and/or terminate any or all services,in whole or in part,if Employer files for bankruptcy, becomes or is declared insolvent,is the subject of any proceedings(not dismissed within 30 days) related to its liquidation,insolvency or the appointment of a receiver or similar officer,makes an assignment for the benefit of all or substantially all of its creditors,takes any corporate action for its winding-up,dissolution or administration,enters into an Agreement for the extension or readjustment of substantially all of its obligations,or recklessly or intentionally makes any material misstatement as to its financial condition Termination of this Agreement shall not terminate the rights or obligations of either party arising prior to the effective date of such termination The indemnity,confidentiality and privacy provisions of this Agreement shall survive its termination If prior to the end of the first 12 months following the original Effective Date,unless the Employer terminates this Agreement with cause as described in(e)above,an early termination penalty will be charged in addition to any setup io and monthly fees due Flex-Plan.The early termination penalty is ten percent of the remaining projected first year monthly fees Flex-Plan will charge a shipping and handling fee for the return of COBRA information to the Employer or its representative The fee will be determined by Flex-Plan and will consist of reasonable compensation for time expended and reimbursement for expenses incurred for materials and postage. Flex-Plan may retain copies of such information as necessary to demonstrate compliance with this Agreement Under no circumstances will Flex-Plan be obligated to notify any Qualified Beneficiary orany other person of the termination of this Agreement 8 Governing Law This Agreement shall be governed by the laws of the state of Washington and any dispute arising out of this Agreement will be settled in any court of competent Jurisdiction in King County,Washington. 9. Schedules and Addenda Attached to this Agreement are the following Schedules and Addenda,which are incorporated in this Agreement: • Schedule A—Schedule of Selected Services and Fees • Addendum 1.Carrier Direct Eligibility Option 1 Agreement Acceptance IN WITNESS WHEREOF Flex-Plan Services,Inc.and the Employer,by their duly authorized representatives,have executed this Agreement "Flex-Plan" FLEX-PLAN SERVICES,INC. By. Jim Aitken Title- President Date 9/11/2013 "EMPLOYER" CITY OF KENT By Title Date S' 11 Schedule A The COBRA services are based on the number of COBRA plans,COBRA family units and benefit eligible employees The initial setup and annual renewal fees are based on the number of plans and COBRA family units enrolled The monthly administration fee is based on a PEPM rate billed at the start of each month. COBRA Service Fee Initial Set-Up Fees Initial COBRA Plan/Rate Set-Up Fee $50 00/Plan Initial COBRA Participant Set-Up/Communication Fee $10 DO/COBRA Family Minimum Initial Set-Up Fees $200 00 AIn tiva ees Renewal Fee for Plan and Rate Changes $50 00/Plan COBRA Enrollee Election/Rate Change Letter $10 00/COBRA Family Minimum Renewal Processing fee $150 00 Monthly COBRA Administration Fee Base Monthly Administration Fee' $400 00 2%COBRA Administration Feel Retained or Invoiced by FPS Other Fees Notifications Required by Legislative Changes $10.00 per letter or notification Manual Data Entry Fee $5 00 per"participant"entered Special Handling3 $15-00 per occurrence plus postage ­�,- ,6jrt, , Optional Service`s Fee Mass mailing of initial general notice to all active employees and covered $50.00 fee plus$5 00 per notice spouses Open enrollment services for enrolled COBRA family units $20fee per kit mailed plus postage Carrier Direct Eligibility(Option 1) Included HIPAA Certificates of Credible Coverage $4 00 per notice 'This rate is used to calculate the monthly fee that will be uniform during the guarantee period. 'If this fee is not added to the COBRA rates and paid by participants,FPS will invoice the employer for the 2%allowable COBRA fee 'Includes rush notices,non-standard shipping,employer invoicing of COBRA premiums,etc_) 12 I Y Addendum 1:Option 1—Carrier Direct Eligibility NOTE,Availability of this option is contingent upon the agreement of the Carriers to accept updates from Flex-Plan. Employer will provide a list of contact names and phone numbers of the Carrier for each Plan for which this service will be provided The Employer must provide this information to Flex-Plan a minimum of 45 days in advance of the Effective Date of this Agreement It is the Employer's sole responsibility to reconcile the Carrier invoice for each Plan with the end-of-month reports provided by Flex-Plan Any errors resulting from the failure to do so will be the sole responsibility of the Employer Flex-Plan will update the Carrier(s)with initial COBRA election,election changes,or Plan termination information as s follows: Initial COBRA elections—within 10 business days following receipt of a signed election form and the initial premium payment,Flex-Plan will notify the Carrier(s)of the election in a format mutually agreed upon between Flex-Plan and the Carrier(s) Election changes—Flex-Pian will notify the Carrier(s)approximately 15 business days after the close of the preceding COBRA month of election changes(forexample,adding or dropping coverage for qualified beneficiaries or their dependents)in the prior month Plan terminations—Flex-Plan will notify the Carrier(s)approximately 15 business days after the close of the preceding COBRA month of any terminat=s of Plan or COBRA coverage for qualified beneficiaries or their dependents in the prior month 13