HomeMy WebLinkAboutReso 184-2018 (18-974)City of South San Francisco P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
City Council
Resolution: RES 184 -2018
File Number: 18 -974 Enactment Number: RES 184 -2018
RESOLUTION APPROVING AN AGREEMENT WITH TRISTAR
RISK MANAGEMENT SERVICES FOR WORKER'S
COMPENSATION CLAIMS ADMINISTRATION SERVICES IN AN
AMOUNT NOT TO EXCEED $496,820 FOR JULY 1, 2016
THROUGH JUNE 30, 2019, AND AUTHORIZING A BUDGET
AMENDMENT TO THE SELF - INSURANCE FUND FOR FISCAL
YEAR 2018 -2019.
WHEREAS, the City has contracted with Tristar Risk Management Services for worker's compensation
claims administration services since 1997, in order to maintain a self - insured worker's compensation
program; and
WHEREAS, the current agreement with Tristar was last amended in 2015 for the period of July 1, 2015
to June 30, 2016, attached hereto and incorporated herein as Exhibit 1; and
WHEREAS, based on increased indemnity claims and cost -of- living increases, Tristar's required service
fee has increased from $152,800 to $191,220 for fiscal year 2018 -2019; and
WHEREAS, the last contract extension between the City and Tristar covered only up to the period of
July 2015 to July 2016; and
WHEREAS, since then, Tristar has continued to provide services to the City under the rates and terms of
the contract extension covering 2015 -2016; and
WHEREAS, the City desires to provide continuous services for worker's compensation claims through
Tristar during the remainder of the current fiscal year while considering alternative options for
cost - effective claims administration for fiscal year 2019 -2020; and
WHEREAS, the City and Tristar agree to enter into an agreement to retroactively cover the period of
July 2016 to June 2016 under the $152,800 service fee rate, and continue to cover the current July
2018 -June 2019 period under the $191,220 service fee rate; and
WHEREAS, the increased service fee rate for 2018 -2019 is $38,420 above the amount allocated in the
2018 -2019 budget for claims administrator service fees, but no new funding is required as the excess
amount will be covered by the total worker's compensation claim allocation within the City's
self - insurance fund; however, a budget amendment is necessary to allocate funds from claims losses to
claims administration fees to cover the excess amount.
City of South San Francisco Page 1
File Number. 18 -974
Enactment Number., RES 184 -2018
NOW THEREFORE BE IT RESOLVED, that the City Council of the City of South San Francisco
hereby takes the following actions:
1. Approves the Agreement for claims management services for the period of July 1, 2016 through June
30, 2019, attached hereto and incorporated herein as Exhibit 2.
2. Authorizes the City Manager to execute this agreement and to make any revisions, amendments, or
modifications, deemed necessary to carry out the intent of this resolution which do not materially
alter or increase the City's obligations thereunder, subject to approval as to form by the City
Attorney.
3. Approves Budget Amendment number 19.025 to allocate an amount of $38,420 from the City's
Self - Insurance Fund to claims administration service fees.
At a meeting of the City Council on 10/24/2018, a motion was made by Richard Garbarino, seconded by
Pradeep Gupta, that this Resolution be approved. The motion passed.
Yes: 4 Mayor Normandy, Councilmember Garbarino, Councilmember Gupta, and
Councilmember Addiego
Absent: 1 Mayor Pro Tem Matsumoto
Attest
City of South San Francisco Page 2
CLAIMS SERVICE AGREEMENT - WORKERS COMPENSATION
THIS CLAIMS SERVICE AGREEMENT ( "Agreement ") is made by and between TRISTAR
Risk Management, a California corporation, hereinafter referred to as "TRISTAR," with
principal offices at 100 Oceangate, Suite 700, Long Beach, CA 90802, and the City of South San
Francisco, hereinafter referred to as "Client ", with principal offices located at 400 Grand
Avenue, South San Francisco, CA 94080.
In consideration of the mutual covenants and promises of the parties, TRISTAR hereby agrees to
furnish to Client, and Client hereby agrees to receive from TRISTAR, those certain claims
handling services identified in this Agreement, all on the terms and conditions set forth herein:
ARTICLE 1 — TERM
1.1 The initial term of this Agreement shall commence on July 1st, 2011, and shall remain in
effect continuously through June 30t", 2013, unless terminated in accordance with the
provisions of Article 12 of this Agreement.
ARTICLE 2 — DEFINITIONS
As used herein and in the performance of set-vices by TRISTAR for Client, the following terms
shall have the meanings described below:
2.1 Adjust or Adjustment: The process of handling and disposing of claims involving injury,
death damage or loss, in accordance and consistent with generally accepted claims
handling standards.
2.2 Administrative Agency: Any state, federal, or local governmental agency which
supervises or regulates the handling of claims, including, but not limited to, industrial
commissions, workers' compensation offices, bureaus, commissions, and state insurance
departments and boards.
2.3 Allocated Loss Adjustment Expenses (ALAE
A. Except as provided in Subsection 2.3.13 below, those expenses arising out of or
connected with the handling and disposition of claims by TRISTAR including,
but not limited to:
1. Fees of attorneys, including representation at hearings or pretrial
conferences;
2. Fees of court reporters;
3. Court costs, court fees and court expenses, service of process;
4. Costs of undercover operative and detective set-vices;
1
Costs of employing experts for advice, opinions, or testimony concerning
claims under investigation or in litigation and costs of appraisals;
Costs of independent medical examinations and/or evaluations for
rehabilitation and /or to determine the extent of Client's liability;
Costs of legal transcripts of testimony taken at coroner's inquests, criminal
proceedings, or civil proceedings;
Costs of copies of public records and /or medical reports;
Fees paid to witnesses and corresponding travel expenses;
10. Costs of photographs and photocopy services;
11. Vocational Rehabilitation, Medical Case Management and Utilization
Review;
12. Electronic Index Bureau inquiry or reporting fees;
13. Interest paid as a result of litigation;
14. State - mandated electronic data interchange (EDI) costs.
15. Section 111 MMSEA of 2007 reporting.
B. "Allocated Loss Adjustment Expenses" shall not include (i) any of the fees, costs,
or expenses that are included in the claims service fees payable to TRISTAR by
Client as agreed to herein or (ii) any payment of benefits to claimant or claimant's
representatives.
2.4 Authority: That sum of money set forth in this Agreement for which TRISTAR
shall have full and sole discretion and authority to adjust and make payments on behalf of
Client unless advised differently by Client in writing.
2.5 Claim: A single exposure of liability involving actual or potential injury, death, loss or
damage reported by Client to TRISTAR which might result in any payment being made
on behalf of Client and for which TRISTAR establishes a claim file, with the following
types:
A. Indemnity Claim: Each separate claim where a reserve is established in the
indemnity category based on possible exposure, regardless of whether or not any
indemnity payment is ultimately made.
B. Medical -Only Claim: Each separate claim where an indemnity reserve is never
established, but a medical reserve is established based on possible exposure.
C. Incident Report: A claim where no reserve of any kind is established.
2.6 Claim Adjustment File: Documentation of the claim adjustment process arising from any
single incident involving one or more claimants and containing the relevant activity
records, including written records of notices, investigations, evaluations, and payments.
2.7 Incident Date: The date of an event as reported by Client or as later revised by TRISTAR
as the more appropriate date of occurrence.
2.8 Report Date of Claim: The date when Client first reports claim to TRISTAR.
2.9 Reserve: The monetary evaluation by TRISTAR of the estimated financial exposure to
Client with respect to a claim.
2.10 Services: Those services described in Article 3 of this Agreement and Exhibit A hereto
(which Exhibit is incorporated herein by reference) that are furnished by TRISTAR to
Client in accordance with the terms of this Agreement, the applicable insurance policy if
any, or in compliance with the laws of any state having jurisdiction over the claim.
ARTICLE 3 — AUTHORITY AND RESPONSIBILITIES OF TRISTAR
3.1 Subject to all the terms and conditions of this Agreement, TRISTAR shall have the
authority and responsibility to provide claims adjusting and administration services for
the Client in connection with claims or losses adjusted during the term of this Agreement.
3.2 In comnection with its authority and responsibilities under this Agreement, TRISTAR
shall:
A. Receive and examine, on behalf of the Client, all claims reported to it and initiate
procedures for the proper servicing of each claim.
B. hivestigate and adjust, settle or deny all claims in accordance with applicable
insurance laws and Client guidelines, as provided in Article 4 hereof.
C. Upon approval or at the direction of the Client, engage the services of persons or
firms outside its organization for work in connection with investigations and
adjustment of claims and to incur other "Allocated Loss Adjustment Expenses"
(as herein defined) at the Client's expense. Client shall have the right to require
TRISTAR to cease using the services of any person or firm considered
unsatisfactory by the Client.
D. Establish and adequately reserve each claim for which there is injury and/or
anticipated liability and/or a formal claim has been made and code each claim in
accordance with Client's statistical data requirements as may be mutually agreed
upon.
E. Make timely payments of valid claims for compensation, rehabilitation expenses,
and other required benefits payable under applicable insurance laws, together with
Allocated Loss Adjustment Expenses, out of funds provided by the Client
pursuant to Article 5 hereof subject to the limitations and requirements of this
Agreement. If an authorized representative of the Client directs in writing that
any payment not be made, and if after receipt of such notice TRISTAR
nevertheless makes such payment, TRISTAR will reimburse Client for the
payment(s).
F. Maintain an accurate and complete claim file on each reported claim which shall
be available during normal business hours for inspection by the Client, its
representatives or by appropriate regulatory authorities. The Client shall have the
right to copy any and all claims files or any documents related to any claim.
TRISTAR shall maintain and store closed claim files for no less than one year
after the expiration of the statute of limitations applicable to each claim file or as
otherwise directed by governing state law.
G. Provide all forms necessary for efficient claims administration and prepare and
timely file all legally required forms and reports with the appropriate state and
federal agencies.
H. In connection with the performance of its obligations under this Agreement,
provide licensed claims adjusters and perform the services to be rendered in good
faith, and in accordance with all applicable laws and regulations.
I. Protect and pursue any subrogation rights of the Client which may arise upon
payment of claims and notify the Client of any subrogation rights which, through
litigation or otherwise, may be available to the Client.
7. Perform all administrative and clerical work in connection with reported claims
including the preparation of checks and/or drafts drawn on the loss fund
established herein.
K. Respond immediately to any inquiry, complaint or request received from an
Insurance Department, other Regulatory Agency, Client, claimant, agent, broker,
or other interested party relating to a claim serviced under this Agreement; a copy
of both the original inquiry and the TRISTAR's response shall be provided in a
timely manner to Client.
L. Upon prior approval of Client, engage the services of licensed and/or Certified
Health and Rehabilitation firms or individuals for Rehabilitation Management as
may be required by state regulations.
M
M. Report all cases involving suspected fraud to the appropriate state mandated
agency. Settlement authority is not permitted on cases of suspected fraud unless
TRISTAR receives written authority from Client. When operating in states that
require fraud to be reported to the state insurance department, TRISTAR must
maintain an internal special investigative unit or contract with an entity to provide
such services.
N. Provide first notice and status reports to excess insurers in accordance with the
criteria and reporting format dictated by that excess carrier.
ARTICLE 4 - CLAIM SETTLEMENT AUTHORITY
4.1 Unless otherwise advised by the Client or in cases of suspected fraud, TRISTAR shall
have authority to make payments on claim files with the following limitations:
A. Any settlement on a single claim file in excess of $25,000 shall first be approved
by the Client.
B. Single
payments of any
allocated
adjustment expense in excess of $25,000 shall
first be
approved by the
Client.
C. Any settlement of a single claim file, which would involve an aggregate
expenditure (of loss and Allocated Loss Expenses) in excess of the Client's SIR,
must first be approved by Excess Carrier.
4.2 Client shall have the option of taking over the handling and settlement of any claim upon
written notice to TRISTAR.
4.3 TRISTAR shall comply with claims procedures and guidelines as may be agreed to by
TRISTAR and the Client.
ARTICLE 5 - CLAIM FUNDING /TRUST ACCOUNT
5.1 TRISTAR shall have the authority to draw upon a bank account which shall be
established and funded by the Client for the purpose of making payments on claim files.
It is the responsibility of the Client to have sufficient funding available in the account to
allow TRISTAR to be able to make all payments in a timely maimer and as required by
law.
5.2 If the account is established by TRISTAR for Client, under TRISTAR's tax identification
number at a banking institution selected by TRISTAR:
A. Client will incur no banking charges nor earn interest.
B. Client account will be exclusive to Client and funds will not be commingled with
funds of any other Client.
C. Account will have a Positive Pay feature with daily electronic transmission of
data from TRISTAR to bank.
D. TRISTAR accounting department will perform a monthly bank reconciliation and
supply same to Client on a timely basis.
E. By 10`x' day of each month, TRISTAR will invoice Client for funds expended the
previous month, so that the account can be replenished. Along with the invoice,
Client will be provided with documentation, such as check registers, concerning
finds expended in the previous month
5.3 If Client elects to arrange its own banking for claims finding, Client will be responsible
for all banking fees and none of the services outlined in Article 5.2 will be provided by
TRISTAR except for any documentation concerning funds expended the previous month.
5.4 Payments from Claims Fund: TRISTAR shall make payment of claims and Allocated
Loss Adjustment Expenses from a claims payment account funded by Client (as provided
in Article 5 of this Agreement).
5.5 No TRISTAR funding: Client acknowledges that at no time will TRISTAR be obligated
to make any claims payments out of TRISTAR funds.
5.6 Requirements of Administrative Agencies: TRISTAR shall file, on a timely basis on
behalf of Client, such forms and reports as may be required by any Administrative
Agency concerning the claim fund account, including handling Escheat reporting.
5.7 1099 Filings: TRISTAR shall collect, process, and report data in the manner prescribed
by the Internal Revenue Set-vice for the purpose of preparing Client's 1099 Miscellaneous
Income filing with respect to the claims payments which are the subject of this
Agreement.
ARTICLE 6 — PAYMENT OF CLAIMS; DISCRECTIONARY AUTHORITY
6.1 Claims Pay n: TRISTAR shall have the authority to make payments on any claim
handled by TRISTAR pursuant to this Agreement.
6.2 Allocated Loss Expenses: TRISTAR shall have the authority to pay, on behalf of Client,
any claims - related services falling within the definition of Allocated Loss Expenses.
6.3 Authority: TRISTAR shall make no single payment in excess of its authority limit
indicated in Article 4 to this Agreement, without the approval of Client.
6.4 Discretion: TRISTAR shall have the full and sole discretion to finally adjust or settle any
claim in an amount equal to or less than the authority limit indicated in Exhibit A to this
Agreement without supervision or direction from Client, and such adjustment or
settlement shall be binding upon Client.
6.5 Reservation of Rights: TRISTAR reserves the right, on any particular claim, to disregard
the authority granted in this Article 4 and treat said claim as requiring Client's approval
prior to final disposition. Client reserves the right, on any particular claim, and upon
written notice to TRISTAR, to revoke the authority granted in this Article 4 and treat
such claim as requiring Client's approval prior to final disposition.
ARTICLE 7 — PROPRIETARY INTEREST
7.1 Ownership of Systems: All systems created or utilized by TRISTAR in the performance
of activities under this Agreement shall belong to, and shall remain the property of,
TRISTAR, and Client shall have no ownership interest therein. The term "systems" as
used herein shall include, but shall not be limited to, computer programs, computer
equipment, formats, risk data report formats, procedures, documentation and internal
reports of TRISTAR, but such term shall not include claims adjustment file data.
7.2 Ownership of Files: TRISTAR shall be entitled to full and complete possession of all
files and materials prepared by TRISTAR in the course of investigating or administering
any claim under this Agreement, until this Agreement is canceled and all outstanding
sums due to TRISTAR are paid by Client. After termination of this Agreement and the
payment of all fees due to TRISTAR, Client shall be entitled to return of Client's files.
7.3 Protection of Data: TRISTAR shall make reasonable efforts to ensure the availability of
the computer loss data and the operation of the computer hardware. In the event of
damage to or malfunction of the computer hardware or software, TRISTAR will use
reasonable efforts to obtain replacement alternative computer hardware to restore service
to an acceptable level in a timely manner. In the event that computer loss data is not
available for use by the computer system utilized by TRISTAR, TRISTAR will attempt
to reconstruct or recover such unavailable data from computer data files stored at remote
locations and from source records, in order to restore service to an acceptable level in a
timely manner.
7.4 Privacy of Data: TRISTAR will make reasonable efforts to maintain the confidentiality
of the data supplied to and used by TRISTAR in the performance of this Agreement.
TRISTAR will not disclose such data or the contents of the corresponding data files
without the consent of Client. Notwithstanding the foregoing, Client agrees that
TRISTAR shall have the right to use such data for the purpose of preparing and
disseminating analytical reports inclusive of the cumulative data of TRISTAR Clients,
provided such use in no way specifically identifies Client or its operations or expenses,
nor individual claimant information.
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ARTICLE 8 — INDEPENDENT CONTRACTOR; AGENCY; SUBCONTRACTING
8.1 hi the performance of this Agreement, TRISTAR, its affiliated corporations and the
employees and officers of TRISTAR are independent contractors.
8.2 TRISTAR reserves the right to subcontract activities under this Agreement, but such
action will not relieve TRISTAR of its obligations to Client in any way.
ARTICLE 9 — INDEMNIFICATION AND INSURANCE
9.1 TRISTAR
agrees to
defend and hold harmless Client, their
officers, agents
and
employees,
from and
against any and all liability, loss, damage
or expense, including
by law to protect itself and
extra contractual and
punitive damages and attorney's fees, incurred in connection
with
claims or
demands
for damages arising out of the services
provided under
this
Agreement,
except when
such claims or demands arise from or are caused by the
sole
negligence or willful
misconduct of Client.
9.2 Client agrees to defend and hold harmless TRISTAR, their officers, agents and
employees, from and against any and all liability, loss, damage or expense, including
extra contractual and punitive damages and attorney's fees, incurred in connection with
claims or demands for damages arising out of the services provided under this
Agreement, when such claims or demands arise from or are caused by the sole negligence
or willful misconduct of Client.
9.3 TRISTAR
shall, at all times while
obligations under this
Agreement remain to be
performed
by TRISTAR, maintain in
force such insurances as
are normal and customary
or required
by law to protect itself and
its Clients, including the
following:
A. Workers' Compensation Insurance under the laws of the states in which
operations are conducted.
B. Comprehensive General Liability Insurance with limits of not less than $1 million
including contractual liability and personal injury for libel, slander and assault
insuring this Agreement.
C. An Errors and Omissions policy providing coverage in the amount of not less than
$3 million.
D. A Fidelity bond providing coverage for all officers and other employees of
TRISTAR (including "money and securities" coverage) in the amount not less
than $1 million.
9.4 Client shall have the right to inspect each of the above - mentioned policies and bonds and
TRISTAR, upon Client's request, shall cause its insurers to provide Client with a
certificate of insurance or other evidence of coverage which provides Client with 30 days
notice of cancellation.
0
9.5 In the event TRISTAR is unable, after using its best efforts, to obtain any of the above -
mentioned coverages, it shall immediately notify Client. Client shall then have the
opportunity to immediately terminate this Agreement or continue the Agreement upon
the understanding that TRISTAR will continue to use its best efforts to obtain and
thereafter immediately obtain any or all such coverages when and if they become
available.
ARTICLE 10 — COMPENSATION
10.1 Exhibit A: Except as otherwise provided in this Agreement, Client shall compensate
TRISTAR in accordance with the terms of Exhibit A to this Agreement. Fees will be for
the term of the Agreement and any renewal subject to Article 1.1.
10.2 Separate Claims Fund: The compensation payable to TRISTAR under this Article 9 shall
in no way include or affect the separate payment obligations of Client as respects the
claims fund described in Article 5 of this Agreement or the direct payment for other
services rendered by TRISTAR.
10.3 Payment Terms: All sums due TRISTAR are due and payable within twenty (20) days of
receipt by Client of TRISTAR invoice.
10.4 Billing Disputes: Client shall have twenty (20) days from its receipt of any billing to
dispute any bill, or portion of a bill, submitted by TRISTAR. Should Client fail to
dispute a billing within the prescribed period of time, the billing shall be deemed correct.
ARTICLE 11- DEFAULT
11.1 The following are events of default under this Agreement:
A. Any material breach of this Agreement which is not cured by the breaching party
within ten (10) days of receipt of notice of such breach by the other party.
B. Failure of Client to provide sufficient funds for payments on claims.
C. Failure of Client to pay Administration fees to TRISTAR as per Agreement.
D. Dissolution, liquidation, voluntary or involuntary bankruptcy of a substantial part
or all of a party's business or entity.
11.2 The failure of either party to declare a default at the time of the defaulting event shall not
act as a waiver to declare a default at a later date.
W
ARTICLE 12 — TERMINATION
12.1 This Agreement may be terminated by Client or TRISTAR as follows:
A. Upon ten (10) days written notice in the event of a default as defined in
Article 11.
B. Upon ninety (90) days written notice.
C. Inmiediately with written notice in the event of fraud, abandomnent, gross or
willful misconduct, insolvency, or lack of legal capacity, by either party.
12.2 Termination by Client: In the event this Agreement is terminated by Client, then any and
all claims and unresolved recovery activities pending on the date of termination shall, at
Client's option, either:
A. Continue to be handled by TRISTAR until the expiration of the period in which
Client has paid the claims service fees, and thereafter on a time - and - expense basis
at TRISTAR's prevailing hourly rate and expense method of billing when time
and expenses are incurred, or
B. Thereafter be assumed and handled by Client or delegated by Client to some third
party, provided, however, that TRISTAR shall be entitled to all fees earned or
incurred prior to the effective date of termination without offset or reduction.
Client shall inform TRISTAR in writing, prior to the termination date of the contract, of
the selected option. Should Client fail to inform TRISTAR or should agreement not be
reached between TRISTAR and Client for the continued handling of the open claims,
then TRISTAR, on the termination date, shall suspend all activity on Client's files, and
TRISTAR thereafter shall have no responsibility for the disposition of such matters.
ARTICLE 13 - HIRING OF EMPLOYEES
13.1 Client agrees that during the tern of, and for a period of two (2) years after the
termination of this Agreement, it will not, without prior written consent of TRISTAR,
hire any employee of TRISTAR or its affiliate who was assigned to, or performed, any
service for Client in connection with this Agreement.
ARTICLE 14 - PAYMENT OF PENALTIES( RECONCILIATION
14.1 Though TRISTAR claims handlers make every effort to avoid penalties, some are
inevitable. All penalties are payable from the Claims Fund of Client. When penalties are
due to improper processing by TRISTAR, TRISTAR will reimburse the Client or claims
fund.
B
14.2 Recognizing that many penalties involve small amounts of money, the accounting cost of
reconciling can outweigh the amounts to be reconciled. For that reason, TRISTAR
performs reconciliation at the end of each service year, or quarterly for accounts with
annual administration fees in excess of $500,000. Client is supplied documentation as to
the reconciliation.
ARTICLE 15 - GENERAL PROVISIONS
15.1 The subject headings of the Articles of this Agreement are included for purposes of
convenience only and shall not affect the construction or interpretation of any of its
provisions.
15.2 This Agreement sets forth the entire understanding of the parties and supersedes any prior
Agreement or understanding relating to the subject matter hereof. No supplement,
modification or amendment of this Agreement shall be binding unless executed in writing
by all the parties. No waiver of any of the provisions of this Agreement shall be deemed,
or shall constitute, a waiver of any other provision, whether or not similar, nor shall any
waiver constitute a continuing waiver. No waiver shall be binding unless executed in
writing by the party making the waiver.
15.3 In the event of any conflict or ambiguity between the terms and provisions of this
Agreement and any Exhibit attached hereto, the terns and provisions of the Exhibit shall
govern.
15.4 Nothing
in this
Agreement shall be construed to mean that either party
has
waived any
rights to
seek a
legal or equitable remedy for breach
of this Agreement by
the
other party.
15.5 Each of the Exhibits listed below is an essential part of the Agreement, which governs the
rights and duties of the parties:
Exhibit A- Relating to Fees payable to Tristar
15.6 TRISTAR may not assign, sell, transfer or otherwise convey, pledge or encumber any of
its rights, obligations or interests under this Agreement without the prior written consent
of the Client.
15.7 Except as otherwise provided herein, the provisions hereof shall inure to the benefit of,
and be binding upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
15.8 This Agreement shall be governed by and construed in accordance with the laws of the
State of California. In the event that any provision of this Agreement is held by a court
of competent jurisdiction to be unenforceable or void in any jurisdiction, the other
provisions of this Agreement shall remain in full force and applicable law shall be
construed in order to effectuate the purpose and intent of this Agreement.
11
15.9 Each notice or other instrument referred to in this Agreement shall be in writing and shall
be deemed "given" to a party when delivered by hand, when given by facsimile
transmission during normal business hours or three (3) days after a writing is deposited in
the mail, postage prepaid and registered, addressed to each party at the address set forth
below or at such other address as such party, by notice to the other party, may designate
from time to time.
If to TRISTAR:
TRISTAR Risk Management
100 Oceangate, Suite 700
Long Beach, CA 90802
Attention: Thomas J. Veale
Telephone: (562) 495 -6600
Fax: (562) 432 -8619
If to Client:
City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
Attention: Kathy Mount
12
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate by their authorized representatives on the dates set forth below.
Date: ✓f ��
Date:
By:
TRISTAR RISK MANAGEMENT
16]I:
Nagel
Title: City Manager
13
Approved as to form
EXHIBIT A
COMPENSATION
Claims Administration Fees
For services rendered pursuant to the attached Agreement for the period July 1, 2011 to June
30, 2013, Client will pay TRISTAR an annual Claims Administration Fee of $148,020.00,
payable, in advance, in monthly installments of $12,335.00.
These fees are premised on an estimated average annual (open) indemnity claims volume of 100
files. Should the actual claim volumes be less than or exceed these estimates by 15 %, then both
parties will agree to negotiate in good faith, as reasonable fee adjustment.
Bill Review Fees
TRISTAR shall utilize TRISTAR Managed Care (TMC) for Medical Bill Review and PPO
Network Access. TMC fees for such services will be paid against individual claim files. The
following TMC fees have been agreed to:
a) For medical treatment and pharmacy bills reviewed to the Official Medical Fee
Schedule or Usual and Customary database:
The fee is $8.50 per bill.
b) For medical treatment and pharmacy bills that belong to the PPO:
The fee is twenty -five percent (25 %) of the PPO savings.
c) For IMFS (Inpatient Medical Fee Schedule):
The fee is $100 per bill of savings.
d) For Specialty Bill Review reductions:
The fee is thirty percent (30 %) of savings
Case Management Fees
For nurse case management services provided by MEDSTAR, the fees will be as follows:
Utilization Review: In Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care including length of
stay and need for assistant surgeon; directing into PPO and
confirmation letters)
Out Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care, directing into PPO
and confirmation letters)
ILI
Telephonic Case Management: $95.00 per hour
Field Case Management: $105.00 per hour, plus expenses
Peer Review: $200.00 per hour for record review without MD
discussion
$250.00 per hour for record review with MD discussion
In consideration of such compensation, TRISTAR shall handle all claims for the period of the
Agreement.
15
FIRST AMENDMENT TO AGREEMENT
That certain Two Party Claims Servicing Agreement effective July 1, 2011, by and between
Tristar Risk Management, (hereinafter referred to as "TRISTAR ") and the City of South San
Francisco, (hereinafter collectively referred to as "Client') for the period July 1, 2011 through
June 30, 2013, is amended herein by deleting in its entirety Article 1 and EXHIBIT A, such
amendment to be effective July 1, 2013. All other terms and conditions of the above referenced
Agreement remain unchanged.
II. EFFECTIVE DATE/TERM
ARTICLE 1— TERM
1.1 The term of this Amendment shall commence on July 15t, 2013, and shall remain in effect
continuously through June 30th, 2014, unless terminated in accordance with the
provisions of Article 12 of this Agreement.
EXHIBIT A
COMPENSATION
Claims Administration Fees
For services rendered pursuant to the attached Agreement for the period July 1, 2013 to June 30,
2014, Client will pay TRISTAR an annual Claims Administration Fee of $148,020.00, payable,
in advance, in monthly installments of $12,335.00.
These fees are premised on an estimated average annual (open) indemnity claims volume of 100
files. Should the actual claim volumes be less than or exceed these estimates by 15 %, therm both
parties will agree to negotiate in good faith, as reasonable fee adjustment.
Bill Review Fees
TRISTAR shall utilize TRISTAR Managed Care (TMC) for Medical Bill Review and PPO
Network Access. TMC fees for such services will be paid against individual claim files. The
following TMC fees have been agreed to:
a) For medical treatment and pharmacy bills reviewed to the Official Medical Fee
Schedule or Usual and Customary database:
The fee is $8.50 per bill.
b) For medical treatment and pharmacy bills that belong to the PPO:
The fee is twenty -five percent (25 %) of the PPO savings.
c) For IMFS (Inpatient Medical Fee Schedule):
The fee is $100 per bill of savings.
d) For Specialty Bill Review reductions:
The fee is thirty percent (30 %) of savings
Case Management Fees
For nurse case management services provided by MEDSTAR, the fees will be as follows:
Utilization Review: In Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care including length of
stay and need for assistant surgeon; directing into PPO and
confirmation letters)
Out Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care, directing into PPO
and confirmation letters)
Telephonic Case Management: $95.00 per hour
Field Case Management: $105.00 per hour, plus expenses
Peer Review: $200.00 per hour for record review without MD discussion
$250.00 per hour for record review with MD discussion
In consideration of such compensation, TRISTAR shall handle all claims for the period of the
Agreement.
Date:
7X == %r
By:
C\ —TY OF S UT� N FRANCISCO
Date: By.
Barry M. Nagel
Title: City Manager
Approvgd a� to form
SECOND AMENDMENT TO AGREEMENT
That certain Two Party Claims Servicing Agreement effective July 1, 2011, by and between
Tristar Risk Management, (hereinafter referred to as "TRISTAR ") and the City of South San
Francisco, (hereinafter collectively referred to as "Client') for the period July 1, 2011 through
June 30, 2013, is amended herein by deleting in its entirety Article 1 and EXHIBIT A, such
amendment to be effective July 1, 2015. All other terms and conditions of the above referenced
Agreement remain unchanged.
II. EFFECTIVE DATE/TERM
ARTICLE 1— TERM
1.1 The term of this Amendment shall commence on July 1", 2015, and shall remain in effect
continuously through June 30`s, 2016, unless terminated in accordance with the
provisions of Article 12 of this Agreement.
EXHIBIT A
COMPENSATION
Claims Administration Fees
For services rendered pursuant to the attached Agreement for the period July 1, 2015 to June 30,
2016, Client will pay TRISTAR an annual Claims Administration Fee of $152,800.00, payable,
in advance, in monthly installments of $12,733.33.
These fees are premised on an estimated average annual (open) indemnity claims volume of 120
files. Should the actual claim volumes be less than or exceed these estimates by 15 %, then both
parties will agree to negotiate in good faith, as reasonable fee adjustment.
Bill Review Fees
TRISTAR shall utilize TRISTAR Managed Care (TMC) for Medical Bill Review and PPO
Network Access. TMC fees for such services will be paid against individual claim files. The
following TMC fees have been agreed to:
a) For medical treatment and pharmacy bills reviewed to the Official Medical Fee
Schedule or Usual and Customary database:
The fee is $8.50 per bill.
b) For medical treatment and pharmacy bills that belong to the PPO:
The fee is twenty -five percent (25 %) of the PPO savings.
c) For IMFS (Inpatient Medical Fee Schedule):
The fee is $100 per bill of savings.
d) For Specialty Bill Review reductions:
The fee is thirty percent (30 %) of savings
Case Management Fees
For nurse case management services provided by MEDSTAR, the fees will be as follows:
Utilization Review: In Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care including length of
stay and need for assistant surgeon; directing into PPO and
confirmation letters)
Out Patient - $95.00 per hour (includes review of treatment
guidelines for appropriateness of care, directing into PPO
and confirmation letters)
Telephonic Case Management: $95.00 per hour
Field Case Management: $105.00 per hour, plus expenses
Peer Review: $200.00 per hour for record review without MD discussion
$250.00 per hour for record review with MD discussion
In consideration of such compensation, TRISTAR shall handle all claims for the period of the
Agreement.
Date: ���� By:
Date: By:
TRISTAR RISK MANAGEMENT
CITY
City Manager
A,t?rv�de;l us ;� #ci r;i
CEty AJfrr"t, ; "2
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) page 1
Claims Services Agreement
AGREEMENT made this ___ day of ____________, 2018 by and between TRISTAR Risk
Management, a California corporation having its principal place of business at 100 Oceangate, Suite
700, Long Beach CA 90802 (“TRISTAR”), and City of South San Francisco, a general law city
organized and operating under the laws of the State of California having its principal place of business at
400 Grand Avenue, South San Francisco, CA 98040 (“Customer”).
WHEREAS, Customer, as a qualified self-insured under applicable state law, has a self-insured retention
program with respect to workers’ compensation claims and claim expenses pertaining to Customer’s
business (“SIR Program”) with a retention level as set forth in Schedule A attached hereto (“Retention
Level”); and
WHEREAS, Customer has the sole responsibility to provide for competent claims administration and
claims funding with respect to claims and/or losses and claims e xpenses arising within the SIR Program;
and
WHEREAS, Customer desires to engage TRISTAR as the claims administrator with respect to those
claims and/or losses arising under the SIR Program, [including certain claims that were previously handled
by Customer or any other entity]; and
WHEREAS, TRISTAR desires to accept such engagement pursuant to the terms and conditions of this
Agreement;
NOW, THEREFORE, in consideration of the terms, conditions and other agreements set forth herein,
TRISTAR and Customer hereby agree as follows:
1. Term
The term (“Term”) of this Agreement shall commence at 12:00 A.M. on July 1, 2016 (“Effective
Date”) and shall remain in effect through June 30, 2019 unless sooner terminated in accordance
with the provisions of Section 9 of this Agreement.
2. Engagement , Duties , and Authority of TRISTAR
2.1 Customer hereby engages TRISTAR and TRISTAR hereby accepts such engagement as the
claims administrator to represent and act for Customer with respect to all claims arising under the
SIR Program, occurring during the Term, reported to TRISTAR during the Term, and assigned to
TRISTAR by Customer (“Claims”). Claims shall consist of:
i) “Takeover Claim(s)” which shall be defined as any Claim reported to TRISTAR that has been
handled by Customer or any preceding manager or administrator prior to being assigned to
TRISTAR and is open and pending as of the Effective Date; and
ii) “Newly Reported Claim(s)” which shall be defined as any Claim other than Takeover Claims.
2.2 The terms and conditions of this Agreement will continue to apply during the Term and during
any period Claims continue to be handled by TRISTAR. In consideration of payment of the
agreed-upon fees as set forth in this Agreement, TRISTAR agrees to perform the following
services (“Services”) during the Service Period as defined in Schedule A and any extension or
renewal thereof, if applicable, with respect to the Claims. Subject to the authority limits stated
below, TRISTAR shall:
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 2
2.2.1 provide to Customer the following basic services (“Basic Services”):
i) establish and maintain an electronic file with respect to each Claim (“Claim File”); such
Claim Files shall include accurate records and accounts of all transactions with respect to
Claims; and be maintained in accordance with prudent standards of record keeping;
ii) conduct analysis of Claims to determine their validity [and compensability] in accordance
with Claims’ guidelines as may be agreed to by TRISTAR and Customer;
iii) establish case-specific reserves, adjust, resist, deny and/or settle Claims as set forth in
Schedule A:
iv) upon approval or at the direction of Customer, use legal counsel where appropriate and assist
legal counsel in the preparation of cases for hearings, trials and/or appeals;
v) comply with the Banking and Funding Schedule attached hereto as Schedule B which
Schedule governs the operation of an account maintained pursuant to Section 4 (“Account”);
vi) pursue, as deemed appropriate by TRISTAR, reasonable possibilities of subrogation,
contribution, or indemnity (not insurance or reinsurance recoveries) on behalf of Customer
and deposit all recovery amounts in the Account;
vii) refer all regulatory complaints to Customer and cooperate with Customer to resolve such
complaints;
viii) report cases involving suspected fraud to the appropriate state mandated agency and when
reporting to the state insurance department is required, use an internal special investigative
unit or contract with an entity to provide such services;
ix) provide TRISTAR’s standard claims reports to Customer; and
x) make payments of valid claims for compensation, rehabilitation expenses, and other required
benefits payable under applicable insurance laws, together with Allocated Lo ss Adjustment
Expenses, out of funds provided by the Customer pursuant to Section 3 hereof subject to
the limitations and requirements of this Agreement.
2.2.2 provide to Customer information services in accordance with the provisions of Schedule C
attached hereto (“Information Services”);
2.2.3 provide, or use TRISTAR Managed Care, Inc. (“TMC”), an affiliate of TRISTAR, to provide,
utilization management services in accordance with the provisions of Schedule E attached hereto
(“Utilization Management Services”);
2.2.4 provide, or use TMC to provide, case management services in accordance with the provisions of
Schedule F attached hereto (“Case Management Services”); and
2.2.5 provide, or use vendors to provide, all other specialty services (“Other Specialty Services”) such
as early intervention, medical bill review, PPO network, Specialty Carve-out PPO networks for
Diagnostic Services and Durable Medical Equipment, claim call -in reporting (telephonic,
electronic, fax or internet), Special Investigat ion (SIU), and index bureau reports. Utilization
Management Services, Case Management Services, and Other Specialty Services shall be refereed
to collectively as “Specialty Services.” Specialty Services are charged as Allocated Loss
Adjustment Expenses (as defined in Section 12) or, where required by state law, as loss.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 3
3. Duties of Customer
3.1 Customer shall:
3.1.1 promptly forward, or cause to be forwarded to TRISTAR, all claims, claim forms, demands,
notices, inquiries or correspondence concerning or related to Claims;
3.1.2 at the time that Claims are assigned to TRISTAR, provide TRISTAR with a copy of any
investigative and pertinent material;
3.1.3 not comment upon, discuss with third parties, or independently adjust, attempt to settle, or
otherwise process Claims without prior written notice to TRISTAR;
3.1.4 comply with the Banking and Funding Schedule as respects the operation of the Account
including Customer’s obligation to provide funds to TRISTAR for the payment of all Claims and
Allocated Loss Adjustment Expenses;
3.1.5 cooperate with TRISTAR with respect to the performance of Claim services, including, but not
limited to: responding promptly to TRISTAR’s requests for information; providing timely
direction to TRISTAR for matters exceeding its authority; meeting with TRISTAR, as may be
needed; and making decisions as required by this Agreement and within such time periods as to
meet all legal requirements applicable to the obligations under this Agreement;
3.1.6 report to any and all insurers, reinsurers or intermediaries all facts, notices, documents, and
information sufficient to comply with reporting requirements of said insurers or reinsurers
regarding the Claims hereunder. TRISTAR shall make no such reports unless specifically
requested in writing by Customer, or as specifically provided in this Agreement. TRISTAR shall
however cooperate with Customer with respect to Customer's obligations to insurers and
reinsurers;
3.1.7 be responsible for managing the vendors (managed care, other third party administrators, and
other services) Customer has contracted with and meeting all requirements in connections
therewith. TRISTAR will have no responsibility or liability for the obligations of vendors or
Customer in connection with the services provided by such vendors and Customer shall
indemnify, hold harmless, and defend TRISTAR against any such liability, except that TRISTAR
shall cooperate with the vendors Customer contracted with and assist Customer with respect to
such vendor requirements;
3.1.8 using Customer’s letterhead, provide written direction to TRISTAR in the event Customer elects
to proceed with Utilization Management Services that do not comply with URAC guidelines as
set forth on Schedule F; and
3.1.9 perform all such other actions and things reasonably necessary or otherwise required to enable
TRISTAR to perform its services under this Agreement.
3.2 Customer represents and warrants that it is and shall remain throughout the Term a qualified self -
insured under applicable state law.
4. Payment of Claims and Allocated Loss Adjustment Expense(s)
4.1 In addition to the invoices for Fees and Expenses (as defined in Subsection 5.5) addressed in
Section 5 below, all Claims obligations, including loss, indemnity, and Allocated Loss
Adjustment Expenses and other Claim-related expenses, are the obligations of Customer and shall
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 4
be funded by Customer as provided in the Banking and Funding Schedule. Customer
acknowledges that at no time will TRISTAR be obligated to make any payments out of TRISTAR
funds.
4.2 Unless otherwise agreed by TRISTAR and Customer, Specialty Services which are listed on
Schedule D attached hereto shall be provided by TRISTAR’s Preferred Provider network, which
may include TRISTAR, its affiliates and subsidiaries (including TMC), or third parties . Specialty
Services will be charged to Customer as Allocated Loss Adjustment Expenses or, where required
by state law, as loss. Customer understands and agrees that TRISTAR may receive compensation
in connection with the Specialty Services, either by retaining a portion of the fees and expenses
charged to the Account, or by receiving fees from preferred providers. The amount TRISTAR
retains or receives will vary depending upon the preferred provider, and may be calculated based
on percentage of savings, percentage of revenue to the provider, or TRISTAR’s mark-up of
provider fees. The amounts retained or received by TRISTAR in connection with Specialty
Services are in addition to the Fees and Expenses paid to TRISTAR by Customer under Section 5
of this Agreement. The fees set forth on Schedule D may be adjusted from time to time without
prior notice.
5. Payment of Fees, Expenses, and Taxes
5.1 For Basic Services and Information Services performed, TRISTAR shall be entitled to and
Customer shall pay the fees and expenses, including Reimbursable Expenses (as defined in
Subsection 5.2), calculated and earned in accordance with this Section 5 and Schedule A.
5.2 TRISTAR shall be reimbursed for those expenses which are incurred by TRISTAR in the
rendering or performance of services and not incorporated in the Basic Fee (“Reimbursable
Expenses”). Reimbursable Expenses include, but are not limited to, any data processing or
telecommunications charges, hotel, travel, living and out-of-pocket expenses related to the
provision of services pursuant to this Agreement.
5.3 For all services other than Basic Services, Information Services, and Specialty Services provided
under this Agreement, Customer shall compensate TRISTAR in accordance with this Section 5
and Schedule A (“Additional Services Fees”), plus Reimbursable Expenses. Additional Services
Fees and expenses charged pursuant to this Subsection 5.3 are in addition to those fees and
expenses charged under Subsections 5.1 and 5.2.
5.4 Customer shall be responsible to pay directly to the applicable taxing authority or to TRISTAR, if
imposed on TRISTAR, all federal, state and local taxes (other than net income taxes) which
TRISTAR may be required to pay or collect or which may be incurred or asse ssed against
TRISTAR or Customer, under any existing or future law, relating to the sale, delivery, rendering
or provision of services by TRISTAR to Customer (“Taxes”).
5.5 TRISTAR shall submit itemized invoices to Customer for all fees, Reimbursable Expenses, and, if
applicable, Additional Services Fees and Taxes (“Fees and Expenses”) incurred in accordance
with this Section 5 on a monthly basis and such invoice shall be paid by Customer to TRISTAR
upon receipt of same. Amounts which remain unpaid in exce ss of thirty (30) days from the date
of receipt of the invoice shall be subject to an interest charge of one and one -half (1.5%) percent
per month, such charge to be effective beginning thirty (30) days after the date due until paid.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 5
6. Records: Inspection , Access, and Ownership
6.1 Customer shall at all times retain the ownership of the Claim Files and Claims data (collectively,
“Claim File Information”). Customer acknowledges that TRISTAR has a right of continuing
possession and access to the Claim File Information, including any accessing software, hardware,
and systems to permit TRISTAR to fulfill all of its obligations under this Agreement, whether
before or after termination, including in the event of any dispute or legal action between the
parties.
6.2 Claim File Information shall, upon thirty (30) days prior written notice to TRISTAR, be available
for on-site audit, review, and/or inspection by duly authorized representatives of Customer and by
regulatory authorities having appropriate jurisdiction. The parties agree that if there are more
than four (4) audits, reviews, and/or inspections including reasonable follow-up of the activities
of TRISTAR by Customer, regulatory authorities or other parties, or any combination thereof
during each twelve (12) month period of the Term, TRISTAR shall be compensated in accordance
with Subsection 5.3 for its involvement with any such additional audit(s), reviews, and/or
inspections.
6.3 At the conclusion of TRISTAR’s obligation to handle Claims and subject to the payment of all
Fees and Expenses due TRISTAR, TRISTAR shall send directly to Customer or a third party
selected by Customer i) an electronic copy in TRISTAR’s then current format of the Claim File
Information, and ii) all open and closed physical Claim Files, if any (collectively, “Transfer
Services”) in accordance with Subsection 9.3. Customer hereby acknowledges that Customer,
such third party selected by Customer, or any succeeding administrator is responsible for retaining
Claim File Information that is transferred to it for the longest of the following time periods:
i) for five (5) years from the closing of the Claim;
ii) for the duration of any applicable regulatory requirement or state law; or
iii) for the duration of the applicable Statute of Limitations.
7. Indemnification, Limitation of Liability , Insurance
7.1 Each Party (“Indemnitor”) agrees to hold the other Party (“Indemnitee”) harmless and indemnify
the Indemnitee against any and all losses, claims, expenses (including reasonable attorneys’ fees),
fines, penalties, damages, judgments or liabilities incurred by the Indemnitee (“Liabilities”) as a
result of an action brought by a third party but only to the extent such Liabilities have been caused
by the actual fraud, negligence or willful misconduct of the Indemnitor with respect to its
obligations under this Agreement.
7.2 Notwithstanding anything in this Agreement to the contrary, UNDER NO CIRCUMSTANCES
AND UNDER NO LEGAL THEORY (TORT, WARRANTY, CONTRACT, OR OTHERWISE)
SHALL A PARTY BE LIABLE TO THE OTHER PARTY, OR ANY OTHER PERSON, OR
ENTITY FOR ANY ACT PERFORMED, OR ANY FAILURE TO ACT, ON BEHALF OF
THAT PARTY OR ANY OTHER PERSON OR ENTITY OR IN THEIR INTEREST, THE
MULTIPLIED PORTION OF ANY MULTIPLIED DAMAGES, INDIRECT, INCIDENTAL,
CONSEQUENTIAL, EXEMPLARY, EXTRA-CONTRACTUAL, PUNITIVE, OR SPECIAL
DAMAGES OF ANY CHARACTER, OR ANY DAMAGES FOR WHICH THE LAW OR
PUBLIC POLICY PROHIBITS INDEMNIFYING OR INSURING EVEN IF T HAT PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
7.3 As used in this Section 7, the terms “Indemnitor” and “Indemnitee” shall include, respectively, its
directors, officers, employees, contractors, subcontractors, agents and other representat ives.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 6
7.4 The provisions of Sections 7.1 – 7.4 shall survive the termination of this Agreement.
7.5 TRISTAR shall, at all times while obligations under this Agreement remain to be performed by
TRISTAR, maintain in force such insurances as are normal and customary or required by law to
protect itself and its clients, including the following:
i) Workers’ Compensation Insurance under the laws of the states in whic h operations are
conducted.
ii) Comprehensive General Liability Insurance and automobile liability insurance with limits of
not less than $1 million dollars per occurrence. If a Commercial General Liability Insurance
or an Automobile Liability form or other form with a general aggregate limit is used, either
the general aggregate limit shall apply separately to the work to be performed under this
Agreement or the general aggregate limit shall be at least twice the required occurrence limit.
Such coverage shall include but shall not be limited to, protection against claims arising from
bodily and personal injury, including death resulting there from, and damage to property
resulting from activities contemplated under this Agreement, including the use of owned and
non-owned automobiles.
iii) An Errors and Omissions policy providing coverage in the amount of not less than $3
million.
iv) A Fidelity bond providing coverage for all officers and other employees of TRISTAR
(including “money and securities” coverage) in the amount not less than $1 million.
8. Confidential Information
8.1 The parties acknowledge that in the course of dealings between each other:
8.1.1 each party will acquire from the other information about business activities and operations,
technical information and trade secrets, all of which are highly confidential and proprietary
(“Confidential Business Information”). Confidential Business Information shall not include (i)
information already known to a party; (ii) information which now is or hereafter becomes publicly
known through no wrongful act of a party, (iii) information received by a party from a third party
without similar restriction and without breach of this Agreement; (iv) information independently
developed by a party; (v) information approved for release by written authorization of the other
party; and (vi) information which, after notice to a party providing a reasonable opportunity to
contest disclosure, must be disclosed pursuant to the Public Records Act and other applicable
requirements of a governmental agency or a final binding order of a court of competent jurisdiction;
and
8.1.2 each party may gain access to and/or generate information of Customer’s consumers, customers,
insureds or claimants which may include personally identifiable, financial and/or health
information which may be protected by federal, state and local laws (“Protected Information”).
8.2 In the event a party provides its Confidential Business Information and/or Protected Information
(collectively “Confidential Information”) to the other party (“Receiving Party”), such
Confidential Information shall be provided subject to the following confidentiality terms:
8.2.1 A party’s Confidential Information shall be safeguarded by the Receiving Party with at least as
great a degree of care as the Receiving Party uses to safeguard its own most confidential materials
or information relating to its own business.
8.2.2 The Confidential Information must be circulated, quoted, disclosed, or distributed solely on a
“need to know basis” and only to employees, attorneys, or consultants of the Receiving Party
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 7
(“Representatives”) after such Representatives have been informed of and agreed to be bound by
this duty of confidentiality. Further, a Receiving Party agrees to obligate each of its
Representatives to a level of care sufficient to protect the Confidential Information from
unauthorized use or disclosure.
8.2.3 A Receiving Party and its Representatives shall not further circulate, quote, disclose or distribute
any of the Confidential Information except as permitted under this Section 8.
8.3 The provisions of this Section 8 shall survive the termination of this Agreement.
9. Termination
9.1 This Agreement shall be terminated in accordance with any of the following subsections of this
Section 9:
9.1.1 Either party may terminate this Agreement by giving at least ninety (90) days prior written notice
of termination to the other party, such termination to be effective no sooner than the first (1 st)
anniversary of the Effective Date.
9.1.2 Upon a material breach by TRISTAR or Customer in the performance of its duties or
responsibilities as provided in this Agreement, the non-breaching party may advise the breaching
party of said material breach by written notice. Except for breach by Customer for failure to pay
Fees and Expenses or a breach by Customer for failure to fund the Account as required in this
Agreement (“Monetary Breach”), the breaching party shall then have thirty (30) days from the
date of written notice within which to cure said breach. For Monetary Breach, the Customer shall
have five (5) business days from date of written notice within which to pay overdue Fees and
Expenses to TRISTAR or to fund the Account as required. The non-breaching party shall have
the right to terminate this Agreement upon written notice to the breaching party if the breaching
party fails to cure said material breach within the specified time period.
9.1.3 This Agreement shall immediately terminate at the election of either party upon the occurrence of
any of the following events with respect to the other party: its insolvency, its inability to meet its
debts as they mature, its filing of a petition of voluntary bankruptcy under any chapter of the US
bankruptcy laws, institution of proceedings to adjudge it bankrupt in an involuntary proceeding,
filing of a petition for rehabilitation or liquidation, execution of an assignment for the benefit of
creditors, its appointment by a court of a receiver, trustee, rehabilitator or liquidator, or its
dissolution.
9.2 If this Agreement is terminated:
9.2.1 for cause pursuant to Subsection 9.1.2 or 9.1.3, TRISTAR shall cease the handling of all Claims
as of the effective date of termination (“Termination Date”) and TRISTAR shall have no more
obligations with respect thereto.
9.2.2 for convenience pursuant to Subsection 9.1.1, Customer, in its sole discretion, shall exercise one
of the following options:
i) Customer may require TRISTAR to continue the handling of all Claims reported to
TRISTAR before the Termination Date, on the terms, conditions and limitations of this
Agreement; or
ii) Customer may require TRISTAR to cease the handling of all Claims as of the Termination
Date and TRISTAR shall have no more obligations with respect thereto.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 8
9.3 Upon termination of this Agreement:
9.3.1 TRISTAR and Customer shall perform all of their respective obligations in accordance with the
terms of this Agreement whether to be performed before or after the Termination Date until the
conclusion of TRISTAR’s obligation to handle Claims as set forth in Section 9.2 and Schedule A.
At that time and upon TRISTAR’s receipt of payment of all earned but unpaid Fees and Expenses,
TRISTAR shall provide the Transfer Services in accordance with Subsections 6.3 and 9.3.2.
9.3.2 Unless this Agreement has been terminated by Customer for cause pursuant to either Subsection
9.1.2 or 9.1.3, Customer shall reimburse TRISTAR for all fees and expenses incurred by
TRISTAR (“Transfer Fees”) in connection with the Transfer Services. These Transfer Fees shall
be considered Additional Services Fees and calculated in accordance with Section 5.3. Transfer
Fees shall include, but not be limited to:
i) the actual costs incurred (examples: packing materials and shipping expenses in the event
there are physical Claim Files); plus
ii) TRISTAR’s fees for its services in effecting such transfer (examples: hourly fees for clerical
labor to inventory, sort, pack, and ship such Claim Files; hourly fees for data processing
labor to perform data extract and testing with receiving vendor; fees for production of
notification letters to claimants, attorneys, and medical providers).
9.3.3 As respects all Claims, Customer shall remain liable for the funding of the Account in accordance
with Section 4 and the payment of all Fees and Expenses in accordanc e with Section 5 that they
would have been liable for had the Agreement not been terminated.
10. Independent Contractor
TRISTAR and its affiliates, shall act as an independent contractor(s) in providing services to
Customer hereunder. Neither this Agreement nor the performance thereof by TRISTAR shall
create nor be deemed to create any employer-employee, joint venture or partnership relationship
between TRISTAR or any of its affiliates, officers, directors or employees, on the one hand, and
Customer or any of its affiliates, officers, directors or employees, on the other hand.
11. Force Majeure
If any cause or condition shall occur beyond the control of TRISTAR which wholly or partially
prevents the performance by TRISTAR of its obligations hereunder, including, without limitation,
any act of God or the public enemy, fire, explosion, flood, earthquake, war, riot, adverse weather
conditions, breakdowns in equipment or facilities, strike, slowdown, work stoppage or other labor
trouble, then TRISTAR shall be excused from its obligations hereunder to the extent made
necessary by such cause or condition and during the continuance thereof, and TRISTAR shall
incur no liability by reason of its failure to perform the obligations so excused. Such cause or
condition shall not, however, relieve Customer of the obligation to pay to TRISTAR fees and
charges due to TRISTAR for services rendered and expenses incurred hereunder prior to such
stoppage.
12. Definition “Allocated Loss Adjustment Expense”
12.1 For the purposes of this Agreement, Allocated Loss Adjustment Expense(s) (“Allocated Loss
Adjustment Expense(s)”) shall mean any fee or expense which is chargeable or attributab le to the
investigation, coverage analysis, adjustment, negotiation, settlement, defense or general handling
of any Claim(s) or action(s) related thereto, or to the protection and/or perfection of the
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 9
Customer’s right of subrogation, contribution or indemnification, all as reasonably determined by
TRISTAR.
12.2 Allocated Loss Adjustment Expense(s) may be incurred for services provided by TRISTAR, its
affiliates and subsidiaries, or third parties and include, but are not limited to, the following:
12.2.1 attorney’s fees and disbursements incurred in connection with the determination of coverage
and/or the adjustment, defense, negotiation or settlement of any Claim; attorney's fees incurred for
representation at depositions, hearings, pretrial conferences and/or trials;
12.2.2 fees and expenses incurred for: handling any Alternative Dispute Resolution proceeding
(“ADR”); legal actions, including trials or appeals; pursuing any declaratory judgment action,
including deposition fees; cost of appeal bonds; court reporter or stenographic services, filing
fees, and other court costs, fees and expenses; transcript or printing services and all discovery
expenses; service of process; witnesses’ testimony, opinions, or attendance at hearings or trial;
12.2.3 fees and expenses for attendance at or participation in ADR proceedings, hearings, trials or other
proceedings by TRISTAR personnel or its subcontractors;
12.2.4 statutory fines or penalties; pre- and post-judgment interest paid as a result of litigation, unless
regulatory or reporting requirements define such interest as loss or indemnity payments;
12.2.5 subcontractors’ fees and travel expenses, including independent adjusters, automobile and
property appraisers, to the extent that same are incurred in the adjustment, negotiation, settlement
or defense of any Claim;
12.2.6 fees and expenses incurred in conjunction with the telephonic, web, or other electronic methods
of reporting Claims as set forth on Schedule D;
12.2.7 experts' fees and expenses including reconstruction experts, engineers, photographers,
accountants, economists, metallurgists, cartographers, architects, hand-writing experts,
physicians, appraisers and other natural and physical science experts, plus the fees and expenses
associated with preparation of expert reports, depositions, and testimony;
12.2.8 fees and expenses for surveillance, undercover operative and detective services or any other
investigations;
12.2.9 fees and expenses for: medical examinations, or autopsies, including diagnos tic services, and
related transportation services; durable medical equipment; and medical reports and rehabilitation
evaluations, unless regulatory or reporting requirements define such fees and expenses as loss or
indemnity payments;
12.2.10 fees and expenses for any public records, medical records, credit bureau reports, index bureau
reports, and other like reports as set forth on Schedule D;
12.2.11 fees and expenses incurred where TRISTAR determines it is reasonable to pursue the rights of
contribution, indemnification or subrogation of the Customer, including attorney and collection
agency fees and/or expenses;
12.2.12 medical or vocational rehabilitation fees and expenses, and all other medical cost containment
services, including, but not limited to utilization review and management, pre-audit admission
authorization, hospital bill audit or adjudication, provider bill audit or adjudication, and medical
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 10
case management, if applicable, unless regulatory or reporting requirements define such expenses
as loss or indemnity payments as set forth on Schedule D; and
12.2.13 extraordinary travel and related fees and expenses incurred by TRISTAR at the express request of
Customer, which are not otherwise payable under this Agreement.
12.3 With respect to TRISTAR’s determination that a fee or an expense incurred pursuant to this
Agreement is an Allocated Loss Adjustment Expense, TRISTAR makes no representation or
warranty and assumes no responsibility that such determination (i ) is in compliance with or meets
the requirements of any statistical plan filing, statutory, regulatory, or insurance industry reporting
scheme or the definition of “Allocated Loss Adjustment Expense” thereunder; (ii) is or could be
characterized as payment of loss or indemnity; or (iii) is or is not subject to insurance or
reinsurance coverage or limits. Customer agrees that it is responsible for making all such
judgments and for complying with any and all such requirements.
13. MMSEA
13.1 Section 111 of the Medicare, Medicaid, and SCHIP (State Children’s Health Insurance Programs)
Extension Act of 2007 (all of which together shall be referred to as “MMSEA”) (P.L. 110 -173),
contains mandatory reporting requirements (“MIR”) for group health plan arrangements and for
liability insurance (including self-insurance), no-fault insurance, and workers' compensation (see
42 U.S.C. 1395y(b)(7) & (8)). As respects compliance with MMSEA under this Agreement:
13.1.1 Customer has the obligation to perform MIR requirements as respects Claims, register with the
Centers for Medicare and Medicaid Services (“CMS”) as a Responsible Reporting Entity
(“RRE”), and provide to TRISTAR all relevant information including the RRE Identification
Number(s) assigned. Customer has appointed the reporting agent(s) identified on Schedule A for
the purpose of meeting MMSEA obligations including MIR requirements (“Reporting Agent(s)”).
13.1.2 Reporting Agent services include determining Medicare eligibility, reporting to CMS eligible
Claims using the mandated format for a determination of Medicare eligibility, processing error
corrections, and providing quarterly reports. Where applicable, Reporting Agent should also
respond to all inquiries and requests for conditional payments, comply w ith settlement approvals,
negotiate and prepare claim set-aside agreements (“CSA’s”) and Medicare set-aside agreements
(“MSA’s”).
13.1.3 Customer consents to the disclosure by TRISTAR of Claims information required by MIR to
Reporting Agent or others for the purpose of providing MIR pursuant to this Agreement.
Customer and TRISTAR agree that Claim data reported to or by CMS is confidential and each
shall take reasonably necessary steps to protect the confidentiality of this data.
13.1.4 Customer agrees that fees and charges by Reporting Agent incurred for compliance with MMSEA
and other related services shall be paid by Customer and charged against the Claim Files as
Allocated Loss Adjustment Expenses. Such fees and charges are listed on Schedule D.
14. Non -Hire
14.1 Without the written consent of the other, Customer and TRISTAR shall not:
i) solicit for employment or employ any employee of the other who is or has been directly
engaged in the performance of this Agreement; and
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 11
ii) for a period of six (6) months following the termination of any employee who had been
directly engaged in the performance of this Agreement, solicit for employment or employ
such employee of the other.
14.2 Customer agrees that: (i) the prohibition against solicitation and employment of TRISTAR
employees by Customer in Section 14.1 without TRISTAR’s written consent shall also apply to
any affiliates of Customer; and (ii) that violation of this prohibition by Customer shall be deemed
to be a material breach of this Agreement by Customer. For purposes of this Section 14.2,
“Affiliates of Customer” includes any entity controlling, controlled by, or in common control with
Customer or any entity in which Customer has an interest during the Term or with which
Customer has entered into a contract.
14.3 This provision shall not apply to any offer of employment by TRISTAR or Customer arising from
a general employment solicitation to the public and not specifically directed at any employee of
the other party who is directly engaged in the performance of this Agreement.
14.4 The provisions of this Section 14 shall apply during the Term and the six (6) month period
immediately following the Term.
15. Notices
15.1 All notices or other communications required pursuant to Section 9 shall be in writing and
sufficient if i) delivered personally; ii) sent by a nationally recognized overnight carrier; or iii)
sent by registered or certified mail return receipt requested, postage prepaid and via facsimile; and
addressed as follows:
TRISTAR: TRISTAR Risk Management
100 Oceangate, Suite 700
Long Beach, CA 90802
Attn.: Thomas J. Veale
With a copy to: TRISTAR Insurance Group, Inc.
2540 Route 130, Suite 109
Cranbury, NJ 08512
Attn.: General Counsel’s Office
Customer: City of South San Francisco
400 Grand Avenue
South San Francisco, CA 98040
Attn.:
15.2 When required or issued pursuant to this Agreement, notices shall be deemed to have been given
at the time i) when personally delivered, ii) upon the day following the day sent by overnight
carrier, or iii) if mailed, upon the third (3rd) day after the date such notice is postmarked.
16. State Amendment Requirements
16.1 The Agreement shall be deemed to incorporate any and all provisions required by applicable state
insurance laws, relating to insurance administrators or third party administrators, insofar as such
provisions relate to the services performed by TRISTAR pursuant to the Agreement.
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 12
17. General
17.1 This Agreement constitutes the entire agreement of the parties and supersedes all previous
agreements and/or contracts whether oral or written between them with respect to the subject
matter hereof.
17.2 If any provision of this Agreement shall contravene or be invalid under the laws of the United
States, the state in which enforcement is sought, or the regulatory requirements of such state, it is
agreed that such provision shall not invalidate the whole Agreement but the Agreement shall be
construed as if not containing the particular provision or provisions held to be invalid.
17.3 This Agreement may only be amended by a written instrument signed by the parties hereto.
17.4 The parties shall not disclose to any third party the terms and conditions of this Agreement,
except as may be required by law, reasonable advice of its counsel, or the written consent of the
non-disclosing party. Notwithstanding the aforementioned, this Agreement may be disclosed to
the parties’ representatives, accountants, attorneys, and advisors and to insurers of Customer,
including excess insurers to and reinsurers of the SIR Program.
17.5 This Agreement shall be binding upon and inure to the benefit of the parties hereto, their
successors and assigns. A party may not assign this Agreement or the services required herein
without the prior written consent of the other party, which shall not be unreasonably withheld or
delayed.
17.6 Except as otherwise provided herein, nothing in this Agreement is intended or shall be construed
to give any person, other than the parties hereto, their respective successors and permitted assigns,
any legal or equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
17.7 A party hereto shall not be deemed to have waived any rights or remedies accruing to it hereunder
unless such waiver is in writing and signed by such party. No delay or omission by a party hereto
in exercising any right shall operate as a waiver of said right on any further occasion.
17.8 Wherever approval of a party is required under this Agreement, it shall not be unreasonably
withheld or delayed.
17.9 The captions are for convenience of reference only and shall not control or affect the meaning o r
construction of any provision of this Agreement.
17.10 This Agreement may be executed in two or more counterparts, each of which shall be deemed to
be an original, but all of which shall constitute one and the same instrument.
17.11 The exchange of copies of this Agreement and of signature pages by e-mail transmission shall
constitute effective execution and delivery of this Agreement and may be used in lieu of the
original for all purposes. Signatures of the parties transmitted by e -mail shall be deemed to be
their original signatures for all purposes.
17.12 This Agreement shall be interpreted and construed in accordance with the internal laws of the
State of California without regard to conflicts of law.
17.13 Each party represents to the other that it is authorized to enter into this Agreement and that its
entry into this Agreement does not and will not violate the terms of any judgment, decree or
ruling or any contract with any third party.
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 13
TRISTAR AND CUSTOMER CERTIFY BY THEIR UNDERSIGNED AUTHORIZED OFFICERS THAT
THEY HAVE READ THIS AGREEMENT, INCLUDING ALL SCHEDULES AND EXHIBITS HERETO,
AND AGREE TO BE BOUND BY ITS TERMS AND CONDITIONS.
TRISTAR Risk Management City of South San Francisco
By: _________________________________________ By: ________________________________________
Name: _________________________________________ Name: ________________________________________
Title: _________________________________________ Title: ________________________________________
Date: _________________________________________ Date: ________________________________________
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 14
Schedule A
General Information; Service Period; Fees and Expenses
This Schedule A shall be effective July 1, 2016 and it shall: i) apply to all Claims reported and
all Information Services provided on or after that date, and ii) remain in effect until the parties
agree on new rates .
The terms and conditions of the Agreement apply unless and to the extent modified or supplemented by
the specific terms and conditions of this Schedule A.
A.1 General Information
A.1.1 Retention Level(s): $500,000
A.1.2 Settlement Authority: $0
A.1.3 Reporting Agent(s):
i) for MMSEA reporting to CMS: TRISTAR;
ii) for MMSEA compliance and other related services: TRISTAR’s Preferred Provider, unless
Customer directs the use of a different vendor.
A.2 Service Period
A.2.1 In consideration of payment by Customer of the fees described in Section A.3, TRISTAR will
provide the Services for the periods set forth below (“Service Period”):
Basic Services. TRISTAR will provide Basic Services for each Claim beginning on the date the
Claim is reported to TRISTAR and ending on the sooner of:
i) the date the Claim is closed; or
ii) the effective date of termination of this Agreement in accordance with any provision of
Section 9.
Information Services. TRISTAR will provide Information Services beginning on the Effective
Date and ending on the date TRISTAR is no longer obligated to provide Basic Services as set
forth above.
A.3 Basic Fees
A.3.1 Annual Services Fee. In consideration for the Basic Services and Information Services for the
first three (3) users performed by TRISTAR during the Service Period, TRISTAR shall be
entitled to and Customer shall pay TRISTAR in accordance with Section A.4, subject to any
adjustments made in accordance with Subsection A.3.3, the following annual fees (“Annual
Services Fee(s)”) each year in twelve (12) equal monthly installments (“Monthly
Installment(s)”):
ANNUAL MONTHLY
ANNUAL PERIOD SERVICES FEE INSTALLMENT
7/1/16 to 6/30/17 .................$152,800..................... $12,733
7/1/17 to 6/30/18 .................$152,800..................... $12,733
7/1/18 to 6/30/19 .................$191,220..................... $15,935
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 15
Subject to the following:
The Annual Services Fee is predicated on an open inventory of One Hundred Thirty-Five (135)
indemnity Claims (“Indemnity Threshold”). In the event the actual number of open indemnity
claims varies from the Indemnity Threshold by fifteen percent (15%) or more in either direction,
then Customer and TRISTAR agree to negotiate in good faith a reasonable adjustment to the
Annual Services Fee.
A.3.2 Fees for optional services requested by Customer. In consideration for the services listed
below (collectively, “Optional Service(s)”) rendered during the Service Period upon the request of
Customer and in accordance with this Agreement, Customer agrees to pay TRISTAR at the
following rates (“Optional Rates”) in accordance with Section A.6, subject to any increases made
in accordance with Subsection A.3.3, for as long as the Optional Services are provided:
If requested by Customer:
Initial Term:
i) For each additional user in excess of three (3): Seven Hundred Fifty dollars ($750) per
user (“Additional User Rate”);
ii) OSHA Reports: Four Thousand dollars ($4,000) per year (“OSHA Rate”);
iii) Standard Data File (monthly): One Thousand Two Hundred dollars ($1,200) per year
(“Data File Rate”)
iv) Self-Insured Reports: in accordance with TRISTAR’s rates, which vary by state, then in
effect (“SIR Report Rate”); and
v) Customized Interface: on a Time and Expense basis at the hourly rate of One Hundred
Forty-Five dollars ($145) (“Customized Interface Rate”).
The Additional User Rate, OSHA Rate, and Data File Rate each shall be pro-rated for each
applicable Optional Service added at any time other than as of the Effective Date or a subsequent
Increase Date, as hereinafter defined.
A.3.3 Increases due to Material Change in business terms. In addition to the foregoing, Customer
agrees that TRISTAR, in its sole discretion, reserves the right to make adjustments to the Annual
Services Fees, Data Conversion Fee, and Optional Rates (collectively, “Basic Fees”) as it deems
necessary in the event any of the following occurs:
i) a material discrepancy is discovered in the historical data and any other information provided
to TRISTAR by Customer or its representatives that is used by TRISTAR to develop the
Basic Fees and this Agreement; and
ii) there is a material change in the scope of services to be provided by TRISTAR, including the
use of TRISTAR’s Preferred Provider network.
A.4 Additional Services F ees
A.4.1 The Basic Fees shall apply to Services, other than Specialty Services, rendered during the Service
Period for Claims. Should TRISTAR be engaged by Customer to provide any other service,
Customer shall pay TRISTAR for such services, in accordance with Section A.6, on a Time and
Expense basis at TRISTAR’s then current hourly rates unless other rates are mutually agreed
upon (“Additional Services Fees”).
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 16
A.5 Expenses
A.5.1 Reimbursable Expenses. Customer shall reimburse TRISTAR for Reimbursable Expenses.
A.5.2 Taxes. Customer shall pay Taxes.
A.6 Payment
A.6.1 Notwithstanding any expiration or sooner termination of this Agreement:
i) the Annual Services Fee shall be deemed fully earned, due, and nonrefundable upon the first
(1st) day of each twelve (12) month period for which it is incurred; and
ii) the Data Conversion Fee shall be deemed fully earned, due, and nonrefundable as it is
incurred;
Optional Rates (if Optional Services requested by Customer and provided by TRISTAR):
iii) the Additional User Rate, OSHA Rate, and Data File Rate shall be deemed fully earned, due
and non-refundable as of the date a new user is added or an Optional Service is provided, and
each subsequent annual anniversary of the Effective Date; and
iv) the SIR Report Rate and Customized Interface Rate each shall be deemed fully earned, due,
and nonrefundable when it is incurred.
A.6.2 All Fees and Expenses shall be payable by Customer to TRISTAR in accordance with Section 5.5
of the Agreement and invoiced as follows:
i) The Monthly Installment, Data Conversion Fee, Optional Rates (if any), Additional Services
Fees (if any), Reimbursable Expenses (if any), and Taxes (if any) shall be invoiced by
TRISTAR at the end of the month in which they are incurred and/or assessed.
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 17
Schedule B
Banking and Funding
This Schedule B shall be effective July 1, 2016 and it shall: i) apply to all Claims obligations, including loss,
indemnity, and Allocated Loss Adjustment Expenses and other Claim -related expenses, and ii) remain in
effect until the parties agree otherwise .
The terms and conditions of the Agreement apply unless and to the extent modified or supplemented by
the specific terms and conditions of this Schedule B.
1. Account for the Payment of Claims and Allocated Loss Adjustment Expense(s)
1.1 All Claims obligations, including loss, indemnity, and Allocated Loss Adjustment Expenses and
other Claim-related expenses, are the obligations of Customer and shall be paid by Customer.
1.2 Customer acknowledges and agrees that the depository bank for Customer funds provided to
TRISTAR for the payment of Claims and Allocated Loss Adjustment Expenses shall be Citizens
Business Bank (“CBB”).
1.3 Customer hereby authorizes TRISTAR to open an account with CBB in trust for (“ITF”)
Customer to be used as the depository/funding account relating to the payment of Claims and
Allocated Loss Adjustment Expenses (“Account”).
2. Duties of TRISTAR
2.1 Any amounts collected by TRISTAR on behalf of or for Customer and any amounts received from
Customer shall be deposited in the Account. Claims and Allocated Loss Adjustment Expenses for
the Claims will be paid by checks showing the identity of Customer that are issued by TRISTAR
against funds in this Account. CBB shall keep records clearly recording the deposits into and
withdrawals from the Account and the balance held on behalf of Customer. When requested by
Customer, but no more than once each month, TRISTAR shall cause CBB to render an accounting
detailing all transactions with respect to the Account, which accounting shall be provided by
TRISTAR to Customer.
2.2 TRISTAR shall collect, process, and report data in the manner prescribed by the Internal Revenue
Service for the purpose of preparing Customer’s 1099 Miscellaneous Income filing with respect
to the Claims and Allocated Loss Adjustment Expenses payments whi ch are the subject of this
Agreement. As respects the Account, TRISTAR shall file required Unclaimed Property reports.
3. Duties of Customer
3.1 Customer shall:
3.1.1 initially deposit in the Account an initial required balance set forth in Exhibit 1 attached hereto
and made a part hereof (“Target Amount”); thereafter, maintain such required Target Amount by
transferring additional funds to the Account at the interval indicated in Exhibit 1 so that it equals
or exceeds the Target Amount. Customer agrees to increase the Target Amount upon request of
TRISTAR, and in an amount to be determined by TRISTAR, within two (2) business days after
Customer is notified by TRISTAR of the amount of the increase;
3.1.2 maintain a minimum balance equal to or greater than Thirty (30%) percent of the Target Amount
(“Minimum Balance”) in the Account at all times. On any day the Account balance is less than
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 18
the Minimum Balance, Customer agrees to transfer sufficient funds to the Account within two (2)
business days after it is notified by TRISTAR so that the balance in the Account equals or
exceeds the Target Amount;
3.1.3 transfer sufficient funds to the Account within two (2) business days of receipt of each request
from TRISTAR to cover each obligation for Claims or Alloca ted Loss Adjustment Expenses
exceeding Twenty-Five (25%) percent of the Target Amount (“Cash Call”) that have been or are
expected to be paid on behalf of Customer;
3.1.4 be liable for and pay any and all overdraft amounts including bank fees and charges and interest
thereon. In the event TRISTAR pays any such amounts on Customer's behalf pursuant to
TRISTAR’s agreement with the Bank, Customer shall immediately reimburse TRISTAR upon
demand; and
3.1.5 except as provided in Section 3.1.4 above, not be responsible for fees charged by CBB to
administer the Customer transactions and the Account. However, earnings or credits earned are
applied toward such bank fees, with the excess, if any, retained by TRISTAR.
3.2 The Customer shall provide such documents, written authorizations or resolutions, in a form
required or acceptable to the Bank, authorizing TRISTAR and/or the Bank to effect the funding
and payment arrangement agreed to under this Schedule B.
3.3 In the event of any dispute between TRISTAR and Customer regarding the propriety of any
request for additional funds as contemplated by Subsection 3.1 above, or regarding the propriety
of TRISTAR's actions in paying or determining to pay a Claim or Claims or an Allocated Loss
Adjustment Expense, Customer shall nonetheless permit or make the payments to the Account
under a reservation of rights so that Customer may enforce its rights with respect to any such
payments or any other matters relating to this Schedule B.
3.4 The Customer’s obligations under this Section 3 have been duly authorized by all necessary
corporate action of the Customer and do not and will not violate any provision of law or of the
Customer’s charter, or by-laws, or require any consent or result in the breach of any agreement to
which the Customer is a party or by which it may be bound or affected.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 19
Exhibit 1
To Schedule B
Citizens Business Bank Account #: 47035493
Target Amount: $157,000
Funding Frequency: Customer shall fund the Account through the Federal Reserve:
on any day the Account balance is less than the Minimum Balance; and
upon notification of a Cash Call; and
each month.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 20
Schedule C
Information Services
The terms and conditions of the Agreement apply unless and to the extent modified or supplemented by
the specific terms and conditions of this Schedule C.
C .1 Scope of Services
In consideration of the payment of the applicable fees calculated in accordanc e with Schedule A,
TRISTAR shall furnish the following to Customer (“Information Services”):
online access to TRISTAR’s claim system (“TRISTAR System”); and
related materials.
C .2 Limited Warranty
TRISTAR MAKES NO WARRANTY OR REPRESENTATION RELATING TO TRISTAR
SYSTEM, THE INFORMATION SERVICES, OR ANY OTHER SERVICES, OR MATERIALS
PROVIDED IN CONNECTION THEREWITH. THE TRISTAR SYSTEM AND MATERIALS
ARE FURNISHED AND ALL INFORMATION SERVICES ARE RENDERED ON AN “AS IS”
BASIS WITHOUT ANY WARRANTY WHATSOEVER. TRISTAR DISCLAIMS AND
EXCLUDES ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
C .3 Limitation of Liability
C .3.1 Customer’s exclusive remedy for damage or loss in any way connected with any Information
Services furnished by TRISTAR, whether by breach of warranty, negligence or any breach of any
other duty, shall be for TRISTAR to refund the amount paid for the Information Services, for
which a claim is made.
C .3.2 Customer assumes sole responsibility for the selection of the Information Services, to achieve its
intended results and for the use made and the result obtained. EXCEPT AS PROVIDED IN THIS
SCHEDULE C, TRISTAR SHALL NOT BE LIABLE FOR DIRECT DAMAGES OR SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, EVEN IF TRISTAR HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. WITHOUT LIMITING THE
FOREGOING, TRISTAR IS NOT RESPONSIBLE FOR ANY COSTS INCURRED AS A
RESULT OF THE USE OF THE INFORMATION SERVICES, INCLUDING WITHOUT
LIMITATION, LOST PROFITS OR REVENUE, LOSS OF DATA, COSTS OF RECREATING
DATA, THE COST OF ANY SUBSTITUTE EQUIPMENT OR PROGRAM, OR CLAIMS BY
ANY THIRD PARTY. TRISTAR’S AGGREGATE LIABILITY ARISING FROM OR
RELATING TO THIS AGREEMENT OR THE INFORMATION SERVICES IS LIMITED TO
THE AMOUNT OF FEES THAT CUSTOMER HAS PAID IN CONNECTION WITH THE
SERVICE FOR WHICH CUSTOMER CLAIMS TRISTAR’S BREACH OF THIS
AGREEMENT. THE PROVISIONS OF THIS AGREEMENT THAT LIMIT TRISTAR’S
WARRANTIES AND CUSTOMER’S REMEDIES REPRESENT AN ALLOCATION OF RISK
BETWEEN TRISTAR AND CUSTOMER. TRISTAR’S PRICING REFLECTS THIS
ALLOCATION OF RISK AND THE LIMITATION OF LIABILITY SPECIFIED HEREIN.
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 21
C .4 Proprietary Rights
C .4.1 Customer’s rights to Information Services under this Agreement may not be transferred, leased,
assigned, or sublicensed except by written consent of TRISTAR, which TRISTAR may grant or
withhold at its discretion.
C .4.2 Customer acknowledges that the Information Services contain proprietary and confidential
information and materials of TRISTAR which are protected as TRISTAR trade secrets and as
copyrighted works, and which Customer may not copy, modify, or distribute except as authorized
by TRISTAR. Customer agrees not to remove or deface any titles, trademarks, copyright notices,
“restricted rights” or other proprietary legends affixed to or incorporated in the TRISTAR System
or the Information Services.
C .4.3 All systems created or utilized by TRISTAR in the performance of activities under this
Agreement shall belong to, and shall remain the property of, TRISTAR and its affiliates, and
Customer shall have no ownership interest therein. The term “systems” as used herein shall
include, but shall not be limited to, computer programs, computer equipment, formats, risk data
report formats, procedures, documentation and internal reports of TRISTAR and its affiliates, but
such term shall not include Claims File Information.
C .5 Internet Use
Information transmitted and received through the internet may be neither secure nor confidential
and TRISTAR cannot and does not guarantee the privacy, security, authenticity, and non-
corruption of any information so transmitted or stored in any system connected to the internet.
TRISTAR shall not be responsible for any adverse consequences whatsoever of Customer’s
connection to or use of the internet, and TRISTAR shall not be responsible for any use by
Customer of Customer’s internet connection in violation of any law, rule, or regulation or any
violation of the intellectual property rights of another.
C .6 Privacy
C .6.1 In the course of providing Information Services, TRISTAR may provide to Customer or Customer
may gain access to or generate personally identifiable, financial and/or health information of
consumers, insureds or claimants which may include confidential information (here inafter
collectively “Protected Information”) which may be subject to federal, state and local laws.
Customer acknowledges and agrees that it (i) shall at all times comply with all federal, state and
local laws and regulations applicable to Protected Information and (ii) shall only use the Protected
Information for the purposes for which it was provided under this Agreement and for no other
purpose. Except as permitted by applicable law or as necessary to carry out its obligations under
this Agreement, Customer shall not disclose, license, sell or otherwise transfer Protected
Information to a third party.
C .6.2 Customer shall immediately notify TRISTAR of any violations of any such law or regulation
applicable to provision of services under the Agreement o r of any complaint or judicial or
administrative proceeding initiated concerning any actual or alleged violation of such law or
regulation. Notwithstanding the termination or expiration of the Agreement, Customer shall
comply with this Section 6 with respect to all Protected Information in Customer’s possession or
in the possession of Customer’s subcontractors or any other third party over which it has control.
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 22
Schedule D
Preferred Provider Specialty Services
Schedule D is effective July 1, 2016 to June 30, 2018. These Preferred Provider Specialty Services fees are paid as
Allocated Loss Adjustment Expenses or, where required by state law, as loss.
Bill Review Fees
a) For medical treatment and pharmacy bills reviewed to the Official Medical Fee Schedule or Usual
and Customary database:
The fee is $8.50 per bill.
b) For medical treatment and pharmacy bills that belong to the PPO:
The fee is twenty-five percent (25%) of the PPO savings.
c) For IMFS (Inpatient Medical Fee Schedule):
The fee is $100 per bill of savings.
d) For Specialty Bill Review reductions:
The fee is thirty percent (30%) of savings
Case Management Fees
Utilization Review: In Patient - $95.00 per hour (includes review of treatment guidelines
for appropriateness of care including length of stay and need for
assistant surgeon; directing into PPO and confirmation letters)
Out Patient - $95.00 per hour (includes review of treatment guidelines
for appropriateness of care, directing into PPO and confirmation
letters)
Telephonic Case Management: $95.00 per hour
Field Case Management: $105.00 per hour, plus expenses
Peer Review: $200.00 per hour for record review without MD discussion
$250.00 per hour for record review with MD discussion
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 23
Schedule D
Preferred Provider Specialty Services
Schedule D is effective July 1, 2018 and is subject to change from time to time thereafter without prior notice.
These Preferred Provider Specialty Services fees are paid as Allocated Loss Adjustment Expenses or, wher e
required by state law, as loss.
Services Fees
Medical Bill Review:
Provider/Ancillary Bill Review $8.75 per bill or $1.50 per line (minimum 4 lines)
Hospital Bill Review (in and outpatient) 12% of savings
Implantable Device Review 27% of savings
PPO/Pharmacy/DME 27% of Savings (all savings are post fee schedule or U&C)
Specialty Bill/Out of Network Review 30% of Savings (all savings are post fee schedule or U&C)
e-billing $1.00 per bill
Historical Bill Review Conversion $750-$2000 One Time Fee at Implementation
Duplicate Bills
Duplicate Line Items
Monthly Savings Reporting
No Charge
Utilization Review:
Pre-clinical review $22 per pre-clinical review. Fee waived if case proceeds
to utilization review
Pre-Certification (In- or Out-Patient) $140 per pre-certification
Concurrent Review
(Review during hospitalization or outpatient
treatment, as treatment progresses to ensure
duration and type of treatment meet
appropriate guidelines)
$125 per hour.
Peer Review:
Level 1
(Includes review of medical records and
communication of decision in writing to all
parties)
$250 flat rate for peer review of episodes of care
identified on medical bill review.
Level 2
(Includes review of medical records,
discussion with treating physician and
communication of decision in writing to all
parties)
$295 flat rate when assigned by a nurse case manager
following case manager file review, or receipt of a referral
by adjuster for review.
Enhanced Intake and Nurse Triage:
Enhanced Telephonic First Notice
(Operator service by medical assistants.
Injured employee and/or supervisor calls to
report claims, assistance with PPO direction,
questions and referrals. Optional integration
with nurse triage services.)
$20 per intake call (waived if call moves to triage)
Telephonic Nurse Triage
(Nurse aids injured worker in self-
treatment or sets up appointment with
appropriate provider utilizing medical
triage guidelines/follow up calls)
$120 per intake call
TRISTAR
CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 24
Nurse Case Management
Telephonic Case Management $105 per hour
OR Duration Based
First 30 days $370 per claim
Second 30 days $285 per claim
Each 30 days until closure $200 per claim
Field Case Management $105 per hour*
*plus Mileage at IRS mileage rate
Field Case Management - Tasks One time visit to provider $475 plus mileage
Two visits to provider $750 plus mileage
Medical record retrieval $135 plus mileage
Job Analysis $475 plus mileage
Catastrophic Case Management
(High level of RN interaction with
immediate response to significant injury,
e.g. severe head injury, severe burns,
gunshot. Available 24x7)
$150 per hour plus mileage
Other Services:
Special Investigations Outsourced, at cost – typically $85 per hour
Central Index Bureau/OFAC/CSE $15 per report
Claim Reporting: Telephonic $20 per report
Claim Reporting: Fax or Internet $10 per report
MMSEA Reporting $10 per claim
Mileage IRS allowance rate
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 25
Schedule E
Utilization Management Services
The terms and conditions of the Agreement apply unless and to the extent modified or supplemented by
the specific terms and conditions of this Schedule E.
E.1 Description
E.1.1 Utilization Management Services is the evaluation of requests for treatment and/or procedures by
determining the medical necessity, appropriateness and efficient of the requested services.
E.1.2 Utilization Management Services may include pre-certification and concurrent review which shall
be performed in accordance with the regulations of the pertinent state, as well as under the
guidelines of TRISTAR’s written policies and procedures and URAC guidelines. TMC’s policies
and procedures will meet all state statutes and regulations for workers’ compensat ion. Telephone
access, hours of operation, level of reviewers, peer review services, time frames and letters may
all be specified by any one or more of the following entities: (i) URAC, or (ii) applicable State
Department of Insurance.
E.2 Scope of Ser vices
E.2.1 TMC will perform Utilization Management Services, which may include the following. TMC
shall:
i) Provide qualified health professionals that operate and complete utilization reviews during
normal business hours;
ii) Employ a credentialed staff of health professionals to perform utilization reviews;
iii) Perform reviews following the prospective requests for review or after the injury to
determine medical necessity. Utilization management that is conducted prior to an injured
workers admission is considered pre-certification. Concurrent reviews occur while treatment
is being delivered to an injured worker. This review assesses the patient’s condition while in
the hospital or for outpatient treatment(s) and/or procedures. Concurrent or prospective
reviews are conducted within five (5) days from the receipt of the necessary medical
information, but in no event more than fourteen (14) days from the treatment
recommendations;
iv) Perform expedited reviews when a) the injured worker faces an imminent and serious threat
to his or her health, including but not limited to the potential loss of life, limb, or other major
bodily function, or b) the normal time frame for the decision-making process would be
detrimental to the injured worker’s life or health or could jeopardize the injured worker’s
permanent ability to regain maximum function. An expedited review will not exceed
seventy-two (72) hours after receipt of the written information reasonably necessary to make
a determination;
v) Complete retrospective reviews at the request of TRISTAR or Customer. Retrospective
reviews must be requested within thirty (30) days from the receipt of all medical information;
vi) Provide peer review services through independent IRO’s that have achieved URAC
accreditation. Any treatment requests that do not meet URAC guidelines cannot be
authorized by TMC and must be referred for peer review. The peer reviewer will review the
information from the treating physician and may contact the provider directly for additional
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 26
information. If the peer reviewer agrees with the treatment plan, a recommendation to certify
will be issued and sent to TMC. If the peer reviewer still finds the treatment not within
guidelines, a letter to not certify is issued to the appropriate parties ; and
vii) Offer a process whereby an injured worker or pro vider on behalf of that injured worker may
contest an adverse determination. In order for TMC to respond appropriately to a wide range
of appeal situations, TMC will provide the injured worker and provider with the required
information in order to complete the appeal process.
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CITY OF SOUTH SAN FRANCISCO (9-26-18) Claims Services Agreement - page 27
Schedule F
Case Management Services
The terms and conditions of the Agreement apply unless and to the extent modified or supplemented by
the specific terms and conditions of this Schedule F.
F.1 Description
F.1.1 Case Management Services, which are provided in order to achieve quality healthcare services
and contain costs, begin with injured employee identification and referral, examples of which
include catastrophic injuries or illnesses, injuries associated with invasive treatment (e.g.,
Surgery), and individuals at risk for non-compliance with treatment.
F.2 Scope of Services
F.2.1 TRISTAR, TMC will perform Case Management Services, which may include the following.
TMC shall:
i) Perform a thorough assessment of the injured worker’s situation;
ii) Develop a case management plan including specific, measurable goals that focus on meeting
the injured worker’s needs through utilization of appropriate resources;
iii) Work with all medical service providers and coordi nate activity in order to provide the best
response to treatment;
iv) Offer treatment recommendations utilizing nationally recognized evidence-based treatment
guidelines such as Official Disability Guidelines (ODG), American College of Occupational
Environmental Medicine (ACOEM), the Medical Treatment Utilization Schedule (MTUS),
or other evidenced-based guidelines to ensure a cost effective treatment plan is in place;
v) Establish a target date for return to light and/or full duty in coordination with the Customer;
vi) Monitor treatment provided to an injured worker to ensure quality and appropriateness; and
vii) Close case when goals are met and the injured worker has improved medically.