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HomeMy WebLinkAboutHR14-321 - Amendment - #1 - Premera Blue Cross - Administrative Service Contract - Extension - 01/01/2016 ���� i ,,�- , e t KEN Document WASH IN GTGNC YP x 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. Vendor Name: Premera Blue Cross Vendor Number: 35646 JD Edwards Number Contract Number: This is assigned by City Clerk's Office Project Name: Medical Coverage Renew Contract Description: ❑ Interlocal Agreement ❑ Change Order ❑ Amendment X Contract ❑ Other: Contract Effective Date: 01/01/2016 Termination Date: 12/31/2016 Contract Renewal Notice (Days): Number of days required notice for termination or renewal or amendment Contract Manager: Becky Fowler Department: Human Resources Contract Amount: $560,000 Approval Authority: ❑ Department Director X Mayor X City Council Detail: (i.e. address, location, parcel number, tax id, etc.): As of: 08/27/14 PREMEM 10 AMENDMENT 1 TO ADMINISTRATIVE SERVICE CONTRACT BETWEEN PREMERA BLUE CROSS AND CITY OF KENT The Administrative Service Contract ("Contract") between the above named group (the "Plan Sponsor") and Premera Blue Cross (the "Claims Administrator") was issued January 1, 2015 through December 31, 2015. This Amendment shall further revise and extend the Contract for the period from January 1, 2016 through December 31, 2016 (the "Contract Period"). The changes to the Contract for the new Contract Period shown below shall take effect on January 1, 2016. The changes are: Section 2 Duties And Responsibilities Of The Plan Sponsor Subsection 2.6, Compliance With Law, is revised to add a reference to the Medicare Prescription Improvement and Modernization Act of 2004 and to add a paragraph about notices about whether the Plan's prescription drug coverage is equivalent to Medicare Part D. The subsection now reads: 2.6 Compliance With Law • The Plan Sponsor shall be responsible for the Plan's continuing compliance with all applicable federal, state and local laws and regulations, as currently amended. These include but are not limited to: • The Internal Revenue Code of 1986. as amended • The Affordable Care Act. • The Paul Wellstone and Pete Dominici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) • The Health Insurance Portability and Accountability Act of 1996 (HIPAA) • The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) • Law and regulations governing the treatment and benefits of Members covered by Medicare. These include, but are not limited to, the Medicare Secondary Payer law and regulations, the Medicare Prescription Improvement and Modernization Act of 2004 (MMA), and the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA). As required by MMSEA, the Plan Sponsor agrees to provide us the following information: • Employer Tax Identification Number(TIN/EIN); • Social Security Numbers (SSNs) of all Members (employees and dependents); and • Medicare Health Insurance Claim Numbers (HICNs)for all Medicare-entitled Members. To comply with the Medicare Secondary Payer law and regulations, the Plan Sponsor also agrees to notify us promptly if the Plan Sponsor experiences a change in total employee count that would change the order of liability according to federal guidelines. MMA requires groups that provide prescription drug coverage to Medicare eligible individuals to provide Medicare Part D Creditable Coverage Notices, and report creditable coverage status to the Center for Medicare and Medicaid Services (CMS). The Plan Sponsor, and not the Claims Administrator, is the"plan administrator"and the "plan sponsor"for purposes of all federal laws that apply to the Plan Sponsor and impose duties or obligations on such ASCAM (01-2016) An Independent Licensee of the Blue Cross Blue Shield Assadalion entities. The Plan Sponsor shall be responsible for determining whether it is subject to COBRA and, if so, for notifying Members of their COBRA rights both initially and upon the occurrence of a qualifying event, for calculating and collecting premiums for COBRA continuation of coverage and for promptly notifying the Claims Administrator when an individual is no longer eligible for COBRA continuation of coverage. If the Plan Sponsor is subject to ERISA, the Plan Sponsor is responsible to prepare and maintain its ERISA plan document. • If the Plan Sponsor elects to opt out of compliance with certain federal mandates as allowed by federal law, the Plan Sponsor is responsible to file its opt-out with federal regulators for each contract period and to notify Members of the opt-out in accordance with federal law and regulations then in effect. The Plan Sponsor agrees to hold the Claims Administrator and the Network harmless for any and all consequences arising from the Plan Sponsor's failure to file an opt-out as required by law for a given contract period, errors in the opt-out filing, or failure to notify a Member as required by federal law. Section 3 Duties And Responsibilities Of The Claims Administrator Subsection 3.1.h., about drug rebates, is revised to clarify how rebates are calculated and distributed: h. Claims Administrator will pay Plan Sponsor a prescription drug rebate payment equal to a specific amount per paid brand-name prescription drug claim. Prescription drug rebates Claims Administrator receives from its pharmacy benefit administrator in connection with Claims Administrator's overall pharmacy benefit utilization may be more or less than the Plan Sponsor's rebate payment. The Plan Sponsor's rebate payment shall be made to the Plan Sponsor on a calendar year quarterly basis unless agreed upon otherwise. The allowable charge for prescription drugs is higher than the price paid to the pharmacy benefit manager for those prescription drugs. The parties hereby agree that the difference between the allowable charge for prescription drugs and the price paid to the pharmacy benefit manager, and the prescription drug rebate payments received by Claims Administrator from its pharmacy benefit manager, constitutes our property, and not part of the compensation payable to Plan Sponsor under this Contract, and that Claims Administrator is entitled to retain and shall retain such amounts and may apply them to the cost of its operations and the prescription drug benefit. Section 7 Subrogation The Subrogation section is revised to clarify the Claims Administrator's role and when fees are charged when a subrogation case is taken to court. 7. SUBROGATION The Claims Administrator shall have no affirmative duty to pursue subrogation claims. However, the Claims Administrator may pursue subrogation claims when the Plan Sponsor purchases subrogation services as described in "Attachment G—Extended Post-Payment Recovery Services" and in accordance with the associated fee attachment, either directly or through a vendor. Claims Administrator will not initiate legal action to enforce the plan's subrogation provision without prior approval from the Plan Sponsor. If Plan Sponsor brings any legal action on its own, Plan Sponsor will be solely responsible for the case, and (1) The Claims Administrator will cooperate with the Plan Sponsor; (2)Any court costs and attorneys'fees incurred in pursuing such subrogation claims shall be the responsibility of the Plan Sponsor; and (3) If Claims Administrator had already opened a subrogation case, Plan Sponsor shall pay Claims Administrator its subrogation fee set forth in"Attachment D— Fees Of The Claims Administrator." (If Claims Administrator had not already opened a subrogation case, no fees shall be due the Claims Administrator. Section 8 Term of Contract Subsection 8.2, Changes to Fees, is revised to allow administrative fees to be adjusted when a Plan Sponsor that has a third party administrator in addition to Premera Blue Cross changes that third party administrator. Administrative fees can also be adjusted if both parties to the 2 I Contract agree that the fees were based in whole or in part on a mistake that materially impacts them. The subsection now reads: 8.2. Changes to Fees The Plan Sponsor acknowledges that the fee schedule set forth in "Attachment D—Fees Of The Claims Administrator"and the services provided for in this Contract are based upon the terms of the Plan and the enrollment as they exist on the Effective Date of this Contract. a. Any substantial changes, whether required by law or otherwise, in the terms and provisions of the Plan or in enrollment may require that the Claims Administrator incur additional expenses. The parties agree that any substantial change, as determined by the Claims Administrator after consultation with the Plan Sponsor, shall result in the alteration of the fee schedule, even if the alteration is during the Contract Period. The phrase"any substantial change"shall include, but not be limited to: 1. a fluctuation of ten (10) percent or more in the number of Members as set forth on the census information included in "Attachment B—Census Information"which is herein incorporated by reference and made a part of this Contract; 2. the addition of benefit program(s) or any change in the terms of the Plan's eligibility rules, benefit provisions or record keeping rules that would increase administration costs by more than $2,000; 3. any change in claims administrative services, benefits or eligibility required by law; 4. any change in administrative procedures from those in force at the inception of this Contract that is agreed upon by the parties; 5. any additional services which the Claims Administrator undertakes to perform at the request of the Plan Sponsor which are not specified in this Contract such as the handling of mailings or preparation of statistical reports and surveys not specified in the Claims Administrator's standard Employer Group Reporting set. 6. A change in the third-party administrator, if any, used by the Plan Sponsor with respect to the benefits provided under this Contract. The Plan Sponsor will provide the Claims Administrator no less than 120 days' advance written notice of any such change. b. The Claims Administrator may also adjust the fees during the Contract Period by giving thirty (30) days advance written notice to the Plan Sponsor or its agent, if the Plan Sponsor agrees with the Claims Administrator that the fees are based in whole or in part upon a mistake that materially impacts such fees. Section 9 Termination We have replaced a reference to "plan administrator"with "plan sponsor." The subsection reads: 9.2. Contract Period Expiration This Contract will terminate on the last day of the Contract Period or the last day of any extension of the Contract Period granted by the Plan Sponsor. We have added a subsection to clarify that the plan sponsor remains liable for delinquent payments at termination: 9.6. Plan Sponsor Liability Upon Termination In the event this Contract is terminated, the Plan Sponsor shall remain liable to the Claims Administrator for all delinquent sums together with interest thereon as provided for in subsection 5.2.c.. Attachment B Census Information The revised Attachment B attached to this Amendment is hereby made a part of the Contract. Attachment D Fees Of The Claims Administrator The revised Attachment D attached to this Amendment is hereby made a part of the Contract. • The attachment's table of services and fees covered by the Extended Post-Payment Recovery Services program is revised to clarify fees if a subrogation case is taken to court. 3 • This attachment includes anew subsection describing fees for the CareCompass3600 Personal Health Support program. References to the PBC Disease Management and Case Management programs are hereby removed. Attachment F Care Facilitation The revised Attachment D attached to this Amendment is hereby made a part of the Contract. Disease Management and Case Management are removed from the list of services in the attachment. These services are now included in the CareCompass360° program described in Attachment H. The Clinical Review description in the list has been simplified. The revised attachment is attached to this Amendment. Attachment G Extended Post-Payment Recovery Services The revised Attachment G attached to this Amendment is hereby made a part of the Contract. We have revised the description of subrogation services to provide more detail about our duties in a subrogation case. Attachment H CareCompass360° The Disease Management attachment(Attachment H) is hereby renamed CareCompass360° and revised to describe the CareCompass3600 Personal Health Support program. The new Attachment is attached to this Amendment and hereby made a part of the Contract. Attachment I Performance Guarantees The revised Attachment I attached to this Amendment is hereby made a part of the Contract. All other provisions of the Contract remain unchanged. This amendment forms a part of your Contract. Please keep the amendment with your Contract. CITY OF KENT r --- {r z €r / DATE:BY: / a r -� Title, y ADDRESS: ;% PREMERA BLUE CROSS BY: D n DATE: January 1, 2016 Jeffrey Roe President and Chief Executive Officer P.O. Box 327 Seattle, WA 98111-0327 4 ATTACHMENT B - CENSUS INFORMATION Administration Fees, effective January 1, 2016, are based on the following: Number of Active Members: Employee Spouse Children i Medical/Rx 595 375 728 Number of COBRA Members: Employee Spouse Children Medical/Rx 8 1 0 Number of Retiree Members: Employee Spouse Children Medical/Rx 73 0 0 Other Carriers Offered: Group Health 5 ATTACHMENT D — FEES OF THE CLAIMS ADMINISTRATOR Pursuant to the Administrative Service Contract, the Plan Sponsor shall pay the Claims Administrator the fees, as set forth below, for administrative services. Administration Fees: ${ )per employee per month The Administration Fee is itemized as follows: Administration Fee Guarantee: The base administration fee, not including other charges such as producer fees, is guaranteed as shown below during the period from January 1, 2015 through December 1, 2017. This period shall be known as the .'administration fee guarantee period." Year Amount Contract Period Begins Contract Period Ends Year 1 $56.65 PEPM January 1, 2015 December 31, 2015 Year 2 $56.15 PEPM January 1, 2016 December 31, 2016 Year 3 $57.85 PEPM January 1, 2017 December 31, 2017 Other Fees: Med/RxAdmin. Fee $48.42 B&O Tax $0.82 Network Mgmt. Fee $6.91 Producer Fee $3.00 Total $59.15 Claims Runout Processing Fee: The charge for processing runout claims is an amount equal to the active administration fee at the time of termination, times the average number of subscribers for the 3-month period preceding the termination date, times two. Value-Based Program Payments Provider groups enter into agreements with Premera or other Blue Cross and/or Blue Shield Licensees (Host Blues)for value-based programs. Such programs include the Blue Distinction Total Care program, Global Outcomes Contracts, accountable care organizations, patient-centered medical homes, shared savings arrangements, and global payment/total cast of care arrangements. Premera and the Host Blues may pay value- based program providers for meeting the programs'standards for treatment outcomes, cost, quality and care coordination. The Plan Sponsor shall pay the Claims Administrator a per-member-per month (PMPM) amount established for each value-based program provider group. The PMPM amount will be multiplied by the number of the Plan Sponsor's members that are attributed to each provider group. The PMPM amounts differ between the provider groups, and may change during the Contract Period. Fee For Class Action Recoveries The Plan Sponsor shall pay the Claims Administrator a fee for its work in pursuing class action recoveries on behalf of the Plan Sponsor as described in Subsection 3.6—Participation In Class Action Suits. The fee shall be 6 I° i I a proportionate share of$10,000, based on the proportion of the amount recovered on behalf of the Plan Sponsor compared to the total amount recovered by the Claims Administrator for all lines of business. BlueCard Fee Amount: BlueCard Fees are tracked and billed monthly in addition to claims expense. Care Facilitation: Included in Administration Fee. See"Attachment F—Care Facilitation"for an overview of services provided. Personal Health Support For members participating in personal health support, there is a separate fee of$245 per actively engaged member per month of active engagement. See"Attachment I—CareCompass360°"for more information. Extended Post-Payment Recovery Services: Claims Administrator will perform the services listed below on a pay-for-performance, contingent fee("Contingent Fee") basis, which shall be calculated as a percentage of the gross amount recovered with respect to any particular claim. See"Attachment G—Extended Post-Payment Recovery Services"for an overview of services provided. Post Payment Recovery Contingent Fee Category Coordination of Benefits 25% Subrogation 25% unless Claims Administrator, in its sole option or discretion, engages outside counsel, in which case the Contingent Fee amount shall be 35%, whether or not the case involves litigation or other dispute resolution process. 25% if, after Claims Administrator has worked a subrogation case, the Plan Sponsor takes over responsibility for the case and settles directly. In all cases, Plan Sponsor is also responsible for payment of any court costs, such as filing fees, witness fees or court reporter fees. Provider Billing Errors 25% Credit Balance 25% Hospital Billing and Chart Review 35% 7 ATTACHMENT F - CARE FACILITATION Claims Administrator agrees to provide the following care facilitation programs for the fees shown in "Attachment D—Fees Of The Claims Administrator." Service Description Care Management Clinical review Prospective and retrospective review for medical necessity, appropriate application of benefits. Includes provision of evidence-based clinical practice and Quality Programs preventive care guidelines to Members and providers, chart tools, and quality of care program activities. Prescription drug formulary Development of formulary and access to providers and promotion Members on-line Physician-based pharmacy Physician education on cost-effective prescribing management ePocrates Software to provide physicians with up-to-date drug and plan formulary information. Education for Members using multiple drugs to review Polypharmacy prescriptions with their providers to decrease incidences of adverse drug interactions Follow-up with Members and physicians to minimize Point-of-sale Pharmacy inappropriate or excessive drug therapies identified when drugs are dispensed. Demand Management Round-the-clock access for Members to RNs to answer questions about health care. 8 ATTACHMENT G - EXTENDED POST-PAYMENT RECOVERY SERVICES Claims Administrator, through its affiliate, Calypso, shall provide a set of Extended Post Payment Recovery Services to the Plan Sponsor as described below. Claims Administrator will perform these services on a pay-for- performance, contingent fee("Contingent Fee") basis,which shall be calculated as a percentage of the gross amount recovered with respect to any particular claim. Contingent Fees are shown in"Attachment D—Fees of the Claims Administrator." Post Payment Recovery Explanation of Services Category Claims Administrator's investigators and auditors will work to identify and pursue overpayments due to Member's missing or inaccurate COB Coordination of Benefits information. Claims Administrator utilizes questionnaires and interviews with providers, employers and Members to determine if Plan Sponsor's Plan is primary or secondary. Claims Administrator's investigators, auditors and attorneys identify and pursue overpayments due to Subrogation opportunities. Claims Administrator's research to obtain accurate subrogation information and determine group's subrogation rights include questionnaires and interviews with providers, employers and Members. As Claims Administrator deems necessary, Claims Administrator manages Subrogation attorney and Member notification,-coordinates case documentation, coordinates with potentially responsible parties and provides representation for hearings. Claims Administrator will notify Plan Sponsor in the event that Claims Administrator recommends that the Plan Sponsor file suit. Plan Sponsor retains the right to authorize or deny any legal action. Claims Administrator's post-payment editing programs and investigators and auditors perform additional screens and tests where billing information is inconsistent with age/services rendered or where Provider Billing Errors there appears to be up-coding or unbundling of services. A recovery process is then employed to request and recover verified overpayments. This service requires an on-site review of the provider's financial records and discussions with their staff. Credit balances are verified as Credit Balance owed to Plan Sponsor and the source of the credit is determined. The credit is reviewed with the provider and approved for payment back to Claims Administrator or the Plan Sponsor. This service requires an on-site review of the Member's medical charts and interviews with provider staff by registered nurses. Calypso out- sources the on-site review work to an independent vendor who ensures that: Hospital Billing and Chart • Service is consistent with diagnosis and billing is consistent Review with services. • There has been no unbundling of services, diagnosis up-coding or billing maximization. • Services rendered were prescribed by the physician and the 9 Post Payment Recovery Explanation of Services Category doctor's notes were signed. • Standardized billing and payment policies were used. Calypso provides support for this vendor's efforts as well as processes all recoveries. 10 ATTACHMENT H - CARECOMPASS3600 Claims Administrator agrees to make available to the Plan Sponsor certain services of the CareCompass360° program,which are more particularly described in Appendix 1 attached hereto and incorporated herein. Claims Administrator, in its sole and absolute discretion, may upgrade or otherwise modify its services. Information and Data • For Plan Sponsors for whom the Claims Administrator does not have claims data as it determines necessary for the prior 24-month period, the Plan Sponsor will attempt to obtain such data from the Plan Sponsor's previous health plan(s), 90 days prior to the Plan Sponsor Effective Date. The Claims Administrator will cooperate with Plan Sponsor's effort in obtaining such data. All such data shall be provided by the Plan Sponsor in a mutually agreeable electronic format. Inability to Provide Data. The Parties recognize that the provision of data referenced above is critical to the success of the services. Therefore, the Plan Sponsor agrees that if any or all data referenced above is unavailable or cannot be obtained in a timely fashion, this could, at the Claims Administrator's option, affect the terms, range and availability of services available to the Plan Sponsor. In the event that at least 24 months of historical data is not available, then the Claims Administrator shall adjust reporting and measurement requirements for such Plan Sponsor accordingly. General Provisions • The parties understand, acknowledge and agree that the services provided to the Plan Sponsor hereunder are designed for availability generally to the entire population of Plan Sponsor Members eligible for such services and not for application to each and every such Member. The Claims Administrator does not represent or warrant that the services provided pursuant to this Attachment will be applied or provided to each and every eligible Member. • Severability. In the event that any provision hereof is found invalid or unenforceable pursuant to judicial decree or decision, the remainder of this Attachment shall remain valid and enforceable according to its terms. 11 Appendix 1 Personal Health Support Services Services of the Personal Health Support program may include: • Telephonic personal health support, including a clinician designated as the participant's single point of contact for personal health support. • Engagement team triage • Periodic reporting on program enrollment and activities Eligible Health Conditions Members eligible for services include those who are classified by Claims Administrator, in its sole discretion, using its own methodology or criteria, as high-risk and/or polychronic(two or more of the chronic conditions designated by Claims Administrator for the program). Claims Administrator may change the methodology for determining eligibility or terms of or criteria for eligibility, at its sole discretion, from time to time. Active Engagement The separate monthly program fee is charged only for members who are actively engaged in personal health support services during the month. "Active engagement" means that a member, or their authorized designee (such as the parent of a minor child or an individual with power of attorney) has at least one two-way conversation with their personal health support clinician in which health goals are discussed. The initial outreach contact to the member does not count. No charges are made for a month in which there is no active engagement. 12 ATTACHMENT I - PERFORMANCE GUARANTEES i 13 �+Y� a3 � ��� �i�+�✓rk �. 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