*1154 Blue Cross and Blue Shield of FloridaOFFICE OF HUMAN RESOURCES AND RISK MANAGEMENT
TRANSMITTAL MEMORANDUM
To: City Clerk
RE: Request for Services
The item(s) noted below is /are attached and forwarded to your office for the following action(s):
❑ Development Order
❑ Final Plat (original mylars)
❑ Letter of Credit
❑ Maintenance Bond
❑ Ordinance
❑ Performance Bond
❑ Resolution
® _Two Original Amendments
Once completed, please:
❑ Return original
❑ Return copy
® Retain, File
Special Instructions:
❑
Mayor's signature
❑
Recording
❑
Rendering
®
Safe keeping (Vault)
❑
Record Custodian
Two original amendments with BCBS: Fifth Amendment and Sixth Amendment
Please advise if you have any questions regarding the above.
Thank you!
From
Date
T: \Dept_forms \City Clerk Transmittal Memo - 2009.doc
SIXTH AMENDMENT TO ADMINISTRATIVE SERVICES AGREEMENT BETWEEN
THE CITY OF SANFORD AND BLUE CROSS AND BLUE SHIELD OF FLORIDA. NC.
This Sixth Amendment (the Amendment) to the Administrative Services
Agreement between the City of Sanford Employer and Blue Cross and Blue Shield of
Florida, Inc, Administrator, dated October 1, 2004 (as amended by Amendments to
Amended Services Agreement, dated November 1, 2006, October 1, 2007 and October
1, 2008, September 1, 2011, November 15, 2012 (hereinafter referred to collectively as
the (Agreement), is made and entered into by the Employer and the Administrator.
RECITALS:
Whereas, The Administrator and the Employer entered into the Agreement; and
Whereas, the Agreement provides that amendments to the Agreement may only
be made by formal written amendment to the Agreement; and
Whereas, the Agreement provides for terms in which the Agreement is to be in
effect; and
Whereas, the parties are desirous of amending the Agreement to provide for a
more precisely articulated term.
Now, Therefore, in consideration of the mutual covenants and agreement herein
made and other good and valuable consideration, the receipt and sufficiency of which is
acknowledged, The Administrator and the Employer agree as follows:
Section 1. Section 1 of the Agreement is amended to read as follows"
"Section I, subsection 1.1, is hereby amended to extend the term of the Group
Health Plan until December 31, 2015 unless the Agreement is terminated earlier in
accordance with the terms of the Agreement."
The above recitals (whereas clauses) are true and correct and are incorporated
herein by reference as if fully set forth herein verbatim.
Section 2. Amendment to Section Exhibit B.
Exhibit "B" of the agreement is amended to read as follows:
"Exhibit B to the Agreement is hereby amended, effective December 1, 2012.
The revised Exhibit B is attached to this Amendment and replaces the Exhibit B
previously attached to the Agreement."
The above recitals (whereas clauses) are true and correct and are incorporated
11Page
FXHIRIT "R"
to the
ADMINISTRATIVE SERVICES AGREEMENT
between
BLUE CROSS AND BLUE SHIELD OF FLORIDA. INC. D /B /A FLORIDA BLUE
and
CITY OF SANFORD
FINANCIAL ARRANGEMENTS
Effective Date
The effective date of this Exhibit is December 1, 2012.
II. Monthly Payments
A. Each month, Florida Blue will notify the Employer of the amount due to
satisfy the previous month's paid claims liability. Florida Blue also will
provide the Employer with a detailed printout of the previous month's
claims payments. The Employer agrees to pay the full amount of the bill
within ten (10) days of the written notification. If the payment is not
received by Florida Blue by the payment due date, the payment will be
considered past due and subject to a late payment charge, as set forth
below. Additionally, Florida Blue will immediately suspend claims until
payment is received by Florida Blue.
B. The Employer agrees to pay to Florida Blue, each month during and after
the term of this Agreement, an administrative fee, as set forth below. The
Employer agrees to pay to Florida Blue, each month, the administrative
fee within ten (10) days of the written notification of the amount due. If
payment is not received by Florida Blue by the due date, the payment will
be considered past due and subject to a late payment charge, as set forth
below. Additionally, Florida Blue will immediately suspend claims until
payment is received by Florida Blue.
III. Funding Information
A. Method of Funding Transfer: ACH
IV. Administrative Fees
A. Administrative fees during the term of the Agreement:
$49.95 per enrolled employee per month from September 1, 2011 through
December 31, 2015.
B. Administrative fees after the termination of the Agreement: 15% of claims
paid. This should not exceed seven months of the current administration
fee, times the current enrollment, at time of cancellation.
C. Florida Blue previously paid $50,000 wellness contribution in 2011, and
agrees to pay another $50,000 wellness contribution upon Employer
execution of the Amendment dated December 1, 2012. This is to be
utilized by the Employer for any wellness related initiatives or activities.
D. If the Employer terminates the Agreement prior to December 31, 2015
without cause, Employer will pay Florida Blue a termination fee of
$50,000. After December 31, 2015, the termination fee will be waived
100 %.
V. Late Payment Penalty
A. A daily charge of .00038 times the amount of overdue payment.
The provisions of the Prompt Payment Act shall apply to this Agreement.
VI. Expected Enrollment
A. The administrative fees referenced above are based on an expected
enrollment of: 400.
B. If the actual enrollment is materially different from this expected
enrollment, Florida Blue reserves the right to adjust the administrative fees
as set forth in the Agreement. Actual administrative fees will be charged
based on actual enrollment.
herein by reference as if fully set forth herein verbatim.
Section 3. Effect Of Amendment.
This Amendment shall take effect upon full execution hereof by the Administrator
and the Employer All other terms and conditions of the Agreement shall apply to the
services provided hereunder and the Agreement and this Amendment shall be read in
harmony and in pari materia. The parties ratify all actions taken to date under the
Agreement.
In Witness Whereof, Administrator and the Employer have caused these
presents to be executed in manner and form sufficient to bind them as of the dates
below written.
ATTEST.
ATTEST.
�/I 'OVA
7J Doughe
City Clerk
For the use and reliance of City of Sanford
only. Approved as to form and legal
sufficiency.
William L. Colbert, City Attorney
Blue Cross Blue Shield of Florida,
Inc.
By:
Title: V
Date: 't'/ X /. L
CITY OF SANFO
By: Jeff
Mayor
Date:
2 1Page
FIFTH AMENDMENT TO ADMINISTRATIVE SERVICES AGREEMENT BETWEEN
THE CITY OF SANFORD AND BLUE CROSS AND BLUE SHIELD OF FLORIDA, NC.
This Fifth Amendment (the Amendment) to the Administrative Services
Agreement between the City of Sanford Employer and Blue Cross and Blue Shield of
Florida, Inc, Administrator, dated October 1, 2004 (as amended by Amendments to
Amended Services Agreement, dated November 1, 2006, October 1, 2007 and October r�
1, 2008, September 1, 2011, (hereinafter referred to collectively as the Agreement), is
made and entered into by the Employer and the Administrator.
RECITALS:
Whereas, The Administrator and the Employer entered into the Agreement; and
Whereas, the Agreement provides that amendments to the Agreement may only
be made by formal written amendment to the Agreement; and
Whereas, the Agreement provides for terms in which the Agreement is to be in
effect; and
Whereas, the parties are desirous of amending the Agreement to provide for a
more precisely articulated term.
Now, Therefore, in consideration of the mutual covenants and agreement herein
made and other good and valuable consideration, the receipt and sufficiency of which is
acknowledged, The Administrator and the Employer agree the Agreement is amended
effective November 15, 2012 as follows:
Section 1. "The subsection entitled "Providers Outside the State of Florida'
under Section III, Duties and Responsibilities of BCBSF is hereby deleted in its entirety
and replaced with the following:
"The subsection entitled "Providers Outside the State of Florida ", under Section
III, Duties and Responsibilities of BCBSF is hereby deleted in its entirety and replaced
with the following:
Providers Outside the State of Florida
Inter -Plan Programs
BCBSF has a variety of relationships with other Blue Cross and /or Blue Shield
Licensees referred to generally as "Inter -Plan Programs." Whenever members access
healthcare services outside the geographic area BCBSF serves, the claim for those
services may be processed through one of these Inter -Plan Programs and presented to
BCBSF for payment in accordance with the rules of the Inter -Plan Programs policies
1 1Page
then in effect. The Inter -Plan Programs available to members under this Agreement are
described generally below.
Typically, members, when accessing care outside the geographic area BCBSF serves,
obtain care from healthcare providers that have a contractual agreement (i.e., are
"participating providers ") with the local Blue Cross and /or Blue Shield Licensee in that
other geographic area ( "Host Blue "). In some instances, members may obtain care from
non - participating healthcare providers. BCBSF's payment practices in both instances
are described below.
Under the Inter -Plan Program called BlueCard®, when members access covered
healthcare services within the geographic area served by a Host Blue, BCBSF will
remain responsible to Employer for fulfilling BCBSF's contractual obligations. However,
in accordance with applicable Inter -Plan Programs policies then in effect, the Host Blue
will be responsible for providing such services as contracting and handling substantially
all interactions with its participating healthcare providers. The financial terms of the
BlueCard Program are described generally below. Individual circumstances may arise
that are not directly covered by this description; however, in those instances, BCBSF's
action will be consistent with the spirit of this description.
B. Liability Calculation Method Per Claim
The calculation of the member liability on claims for covered healthcare services
processed through the BlueCard Program will be based on the lower of the participating
healthcare provider's billed covered charges or the negotiated price made available to
BCBSF by the Host Blue.
The calculation of Employer liability on claims for covered healthcare services
processed through the BlueCard Program will be based on the negotiated price made
available to BCBSF by the Host Blue. Sometimes, this negotiated price may be greater
than billed charges if the Host Blue has negotiated with its participating healthcare
provider(s) an inclusive allowance (e.g., per case or per day amount) for specific
healthcare services.
Host Blues may use various methods to determine a negotiated price, depending on the
terms of each Host Blue's healthcare provider contracts. The negotiated price made
available to BCBSF by the Host Blue may represent a payment negotiated by a Host
Blue with a healthcare provider that is one of the following:
(i) an actual price. An actual price is a negotiated payment without any other increases
or decreases, or
(ii) an estimated price. An estimated price is a negotiated payment reduced or increased
by a percentage to take into account certain payments negotiated with the provider and
other claim- and non - claim - related transactions. Such transactions may include, but are
21Page
not limited to, anti -fraud and abuse recoveries, provider refunds not applied on a claim -
specific basis, retrospective settlements, and performance- related bonuses or
incentives, or
(iii) an average price. An average price is a percentage of billed covered charges
representing the aggregate payments negotiated by the Host Blue with all of its
healthcare providers or a similar classification of its providers and other claim- and non -
claim- related transactions. Such transactions may include the same ones as noted
above for an estimated price.
Host Blues using either an estimated price or an average price may, in accordance with
Inter -Plan Programs policies, prospectively increase or reduce such prices to correct for
over- or underestimation of past prices (i.e., prospective adjustments may mean that a
current price reflects additional amounts or credits for claims already paid to providers
or anticipated to be paid to or received from providers). However, the amount paid by
the member and Employer is a final price; no future price adjustment will result in
increases or decreases to the pricing of past claims. The BlueCard Program requires
that the price submitted by a Host Blue to BCBSF is a final price irrespective of any
future adjustments based on the use of estimated or average pricing.
If a Host Blue uses either an estimated price or an average price on a claim, it may also
hold some portion of the amount that Employer pays in a variance account, pending
settlement with its participating healthcare providers. Because all amounts paid are
final, neither variance account funds held to be paid, nor the funds expected to be
received, are due to or from Employer. Such payable or receivable would be eventually
exhausted by healthcare provider settlements and /or through prospective adjustment to
the negotiated prices. Some Host Blues may retain interest earned, if any, on funds held
in variance accounts.
A small number of states require Host Blues either (i) to use a basis for determining
member liability for covered healthcare services that does not reflect the entire savings
realized, or expected to be realized, on a particular claim or (ii) to add a surcharge.
Should the state in which healthcare services are accessed mandate liability calculation
methods that differ from the negotiated price methodology or require a surcharge,
BCBSF would then calculate member liability and Employer liability in accordance with
applicable law.
C. Return of Recoveries
Under the BlueCard Program, recoveries from a Host Blue or its participating healthcare
providers can arise in several ways, including, but not limited to, anti -fraud and abuse
recoveries, healthcare provider /hospital audits, credit balance audits, utilization review
refunds, and unsolicited refunds. In some cases, the Host Blue will engage a third party
to assist in identification or collection of recovery amounts. The fees of such a third
31 Page
party may be netted against the recovery. Recovery amounts determined in this way will
be applied in accordance with applicable Inter -Plan Programs policies, which generally
require correction on a claim -by claim or prospective basis.
Unless otherwise agreed to by the Host Blue, BCBSF may request adjustments from
the Host Blue for full refunds from healthcare providers due to the retroactive
cancellation of membership but only for one year after the date of the Inter -Plan
financial settlement process for the original claim. In some cases, recovery of claim
payments associated with a retroactive cancellation may not be possible if, as an
example, the recovery conflicts with the Host Blue's state law or healthcare provider
contracts or would jeopardize its relationship with its healthcare providers.
D. BlueCard Fees and Compensation
Employer understands and agrees to reimburse BCBSF for certain fees and
compensation which BCBSF is obligated under the BlueCard Program to pay to the
Host Blues, to the Blue Cross and Blue Shield Association ( BCBSA), and /or to
BlueCard Program vendors, as described below. Fees and compensation under the
BlueCard Program may be revised in accordance with the Program's standard
procedures for revising such fees and compensation, which do not provide for prior
approval by any Employers. Such revisions typically are made annually as a result of
Program policy changes and /or vendor negotiations. These revisions may occur at any
time during the course of a given calendar year, and they do not necessarily coincide
with Employer's benefit period under this Agreement.
Where applicable, access fees will be applied each time a claim is processed through
the BlueCard Program, and will be billed to Employer as an additional claim liability.
Other fees including, but not limited to, administrative expense allowance fees, Central
Financial Agency fees, ITS Transaction Fees, an 800 number fee and a fee for
providing provider directories, if applicable, are included as a component of the
administrative fee and will not be a separate charge to Employer.
Only the BlueCard Program access fee may be charged separately each time a claim is
processed through the BlueCard Program. If one is charged, it will be a percentage of
the discount/differential BCBSF receives from the Host Blue, based on the current rate
in accordance with the Program's standard procedures for establishing the access fee
rate. The access fee will not exceed $2,000 for any claim. All other BlueCard Program -
related fees are included in BCBSF's general administrative fee.
E. Non - Participating Providers
When covered healthcare services are provided outside of BCBSF service area by non-
participating healthcare providers, the amount(s) a member pays for such services will
generally be based on either the Host Blue's non - participating healthcare provider local
payment or the pricing arrangements required by applicable state law. In these
41 Page
situations, the member may be responsible for the difference between the amount that
the non - participating healthcare provider bills and the payment BCBSF will make for the
covered services as set forth in this paragraph.
Employer understands and agrees to reimburse BCBSF for certain fees and
compensation which BCBSF is obligated under applicable Inter -Plan Programs
requirements to pay to the Host Blues, to the Blue Cross and Blue Shield Association,
and /or to Inter -Plan Programs vendors. Fees and compensation under applicable Inter -
Plan Programs may be revised in accordance with the specific Program's standard
procedures for revising such fees and compensation, which do not provide for prior
approval by any Employers. Such revisions typically are made annually as a result of
Inter -Plan Programs policy changes and /or vendor negotiations. These revisions may
occur at any time during the course of a given calendar year, and they do not
necessarily coincide with Employer's benefit period under this Agreement.
F. Inconsistencies
To the extent of any inconsistency between the above provision titled "Providers
Outside the State of Florida" and other terms or conditions of the Agreement, the above
provision controls the above recitals (whereas clauses) are true and correct and are
incorporated herein by reference as if fully set forth herein verbatim.
Section 2. "The first paragraph of the subsection entitled "Pharmacy Rebates" in
Section III, Duties and Responsibilities of BCBSF (if applicable), is hereby deleted and
replaced with the following new first paragraph:
Pharmacy Rebates
In certain circumstances, BCBSF and /or its pharmacy benefits manager and /or vendors
(collectively "PBM ") negotiate(s) and receive(s) formulary rebates, volume discounts,
and /or fees from certain drug manufacturers /distributors as a result of the inclusion of
such manufacturer's /distributor's branded products on BCBSF's formularies
( "Rebates ").
The above recitals (whereas clauses) are true and correct and are incorporated
herein by reference as if fully set forth herein verbatim."
Section 3. . The following new subsection, "Confidential and Trade Secret
Information ", is hereby added to the Agreement under Section II, Duties and
Responsibilities of the Employer
Confidential and Trade Secret Information
BCBSF maintains proprietary and confidential information and competitively- sensitive
trade secret information, which information may be disclosed to Employer for the
51Pacge
purposes of analyzing such information in conjunction with services performed under
the Agreement. Employer agrees to hold such confidential and /or trade secret
information in confidence and only disclose such information to employees of Employer
who have a need to know such information; provided however that such employees of
Employer agree to maintain the confidentiality of the confidential and /or trade secret
information and take all steps necessary to safeguard the confidential and /or trade
secret information against unauthorized access, use, and disclosure to at least the
extent Employer maintains the confidentiality of its most proprietary and confidential
information.
Employer shall not disclose such confidential and /or trade secret information to any third
party without the express written permission of BCBSF unless required to do so by the
public records laws of the State of Florida to include, but not be limited to, Article I,
Section 24 of the Constitution of the State of Florida and Chapter 119, Floridas Statutes.
If BCBSF approves release of confidential and /or trade secret information to a third
party, the third party and Employer will be required to execute a Confidentiality &
Indemnity Agreement, in a form specified by BCBSF, prior to the release of the
confidential information and /or trade secret information to the third party, but only if
consistent with controlling law. For purposes of this paragraph, trade secret information
is competively sensitive information which is advantageous to BCBSF in the
marketplace and BCBSF considers such information to be a trade secret protected from
public disclosure. The provisions of controlling Florida law relating to openness and
transparency in government shall prevail over any provision of this agreement and any
other agreement between the parties
Section 4. The subsection entitled "Claims Processing" in Section III, Duties and
Responsibilities of BCBSF is hereby deleted in its entirety and replaced with the
following:
Claims Processing
BCBSF shall provide claims processing services on behalf of Employer for all properly
submitted claims, in accordance with the benefits set forth in Exhibit "A ", using funds
solely supplied by Employer, as set forth in Exhibit "B ". BCBSF shall furnish each
claimant with an explanation of each claim that is paid, rejected or suspended.
For purposes of this Agreement, the term "claim(s)" shall be defined as the amount paid
or payable by BCBSF to providers of services and /or covered group members under
this Agreement and the Group Health Plan, and in conformity with any agreements
BCBSF enters into with such providers of services. For value -based reimbursement
programs BCBSF enters into with participating providers, an applicable claim level
surcharge may be included in the claim amount.
Claim level charges are used to fund a bonus pool for making quality improvement and
financial performance incentive payments to providers which have entered into a value -
61Page
based reimbursement arrangement with BCBSF. The surcharge is only applicable to
services provided by these providers, and shall not affect member cost sharing.
The accrued bonus pool, which shall be held in a non - interest bearing account, will
include surcharge amounts contributed by other self- funded employers. All amounts in
the bonus pool shall be available to fund incentive payments to providers who have
entered into a value -based reimbursement arrangement with BCBSF and who have
achieved the requisite quality and financial goals.
The amount of the surcharge will be set by BCBSF based on actuarially estimated
incentive payments contractually due to providers. BCBSF will perform periodic
reconciliations of the bonus pool and may adjust the applicable claim level surcharge
from time to time as it reasonably determines necessary to appropriately fund the bonus
pool.
Such claims level surcharge amounts will not be refunded to Employer, including upon
termination of this Agreement. Any surplus funds at the end of an incentive payment
measurement period shall be used to fund incentive payments in a subsequent period.
Any deficit in funds at the end of an incentive payment measurement period shall be
collected in the next period through an adjustment to the claims level surcharge amount
which will cover the previous period shortfall.
Additionally, BCBSF may enter into bundled payment arrangements with providers of
service which require a single provider to be responsible for providing and /or arranging
for the provision of a group of services for a defined episode of care (e.g., hospital,
physician and /or ancillary services).
In processing such claims for the defined episode of care, notwithstanding the
requirements of Exhibit "A ", BCBSF may calculate the member cost sharing based upon
the status of the provider receiving the bundled payment without regard to the fact that
other provider types may have provided certain components of the episode included in
the bundled payment arrangement.
Section 5. Effect Of Amendment.
This Amendment shall take effect upon full execution hereof by the Administrator and
the Employer All other terms and conditions of the Agreement shall apply to the
services provided hereunder and the Agreement and this Amendment shall be read in
harmony and in pari materia. The parties ratify all actions taken to date under the
Agreement.
In Witness Whereof, Administrator and the Employer have caused these presents to
be executed in manner and form sufficient to bind them as of the dates below written.
71 Page
Z TJ ST. Blue Cross Blue Shield of Florida, Inc.
B r,
Title: V
Date: /2,/X
ATTEST.
CITY OF SANFORD
vw- k
Jan Dougherty By: Jeff T
City Clerk Mayor
Date:
For the use and reliance of City of Sanford
only. Approved as to form and legal
sufficien y.
William L. Colbert, City Attorney
81Page