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HomeMy WebLinkAbout1997-256 t . . ~. At RESOLUTION NO. 97-256 APPROVAL OF JOINT POWERS AGREEMENT BETWEEN CITY OF STILL WATER AND SOUTHWEST/WEST CENTRAL SERVICES COOPERATIVE FOR GROUP EMPLOYEE HEALTH BENEFITS BE IT RESOLVED by the City Council of Stillwater, Minnesota, that the Joint Powers Agreement between City of Stillwater and Southwest/West Central Services Cooperative for group employee health benefits, is hereby approved as per attached agreement, and the Mayor is authorized to sign said Agreement. Adopted by Council this 28th day of October, 1997. ATTEST: I- I -,- . . \ . .-: . . Revised 10/26/95 JOINT POWERS AGREEMENT FOR GROUP EMPLOYEE BENEFITS SOUTHWEST AND WEST CENTRAL EDUCATIONAL COOPERATIVE SERVICE UNITS MEMBER CITY AND OTHER GOVERNMENTAL UNIT INSURANCE PROGRAM This Joint Powers Agreement hereinafter referred to as "agreement", is made as of the day of ,19_ J between Member , and such other members as now or hereafter become parties to this agreement, hereinafter individually called "Participant" and the SOUTHWEST AND WEST CENTRAL EDUCATIONAL COOPERATIVE SERVICE UNITS (SWflNC ECSU), hereinafter called the "ECSU" and/or its designee. Pursuant to M.S. 471.59, Subd. 2: It is agreed and understood that: 1 . the objective of this Joint Powers Agreement is to establish, procure and administer group employee benefits and financial risk management services that embody the concept of pooling risks for the purpose of stabilizing and/or reducing costs, and 2. the purpose of this agreement is to define/clarify bid procedures, rights and responsibilities, length of contract, termination guidelines, liability and the method{s) by which parties to this agreement shall exercise their common power. DEFINITIONS 1. Participant - any entity or individual that (who) has been accepted for participation by the joint powers governing board. 2. Group Employee Benefits, (hereinafter referred to as "GEB") shall include, but not be limited to, health benefits coverage, life insurance, disability income protection, dental insurance, and flexible spending programs, and other services as directed by the Board. 3. Other Financial Risk Management Services shall include, but not be limited to, investments, contracted legal services, property/casualty safety group, student accident, and other services as directed by the Board. 4. Board - pursuant to M.S. 471.59, Subd. 11, the SC Board of Directors will serve as the joint powers governing board for the group employee benefits and financial risk management services and all associated services. This Board will be elected pursuant to the Bylaws of the ECSU, governing election of its board of directors. If the ECSU is abolished, the goveming board will be that of the ECSU designee. As appropriate, the Board may designate a representative to act on its behalf. 5. Pool- the collective group of participants in a given program or group employee benefits or other risk management service or activity. RECITALS Each of the parties enters into this agreement pursuant to: - A. MSA 471.59, Subd. 1 and 10: which authorizes two or more governmental units to exercise jointly or cooperatively powers which they possess in common, or B. M.S. 123.58 defining Eucational Cooperative Service Units. Participation in programs and services provided by ECSU shall be discretionary (id. Subd. 4), or Joint Powers Agreement for Group Employee Benefits ~ - ;. i ^ ""11 . C. acceptance by the Board of participation by non-profit, non-governmental units, which shall be held contractually to all terms and conditions of this agreement. . II. Pursuant to M.S. 471.59, M.S. 471.61, and M.S. Section 16.07, the intent of this agreement is to transfer the Participant's right to purchase group employee benefits to the Board under the terms and conditions of this Agreement. III. The parties desire to state in this agreement that their common power shall be exercised for the purpose of providing financial risk management services, which may include but not be limited to: investments, contracted legal services, property/casualty, student accident insurance, dental, Section 125, life and health group insurance pooling, and other services as directed by the Board. IV. The parties desire to state in this agreement their intent to comply with the statutory requirements of group insurance, governmental unit bidding laws, COBRA and its Minnesota extensions, ERISA, and all other applicable federal and state statutes. V. It is not the intent of the parties to the agreement to transfer authority, liability or responsibility for matters other than securing proposals, establishing master contracts, negotiation of operating agreements and funding arrangements, and the facilitation of administrative services and funding arrangements as defined for each component of the group employee benefits and financial risk management services. AGREEMENT The parties agree as follows: I. The Recitals are part of this agreement. . II. PROCEDURES FOR SECURING GROUP EMPLOYEE BENEFITS AND FINANCIAL RISK MANAGEMENT SERVICES. A. The Board shall from time to time change the procedures to comply with applicable law. B. Group Employee Benefits 1. Definition: pursuant to M.S. 471.6161, Subd. 1 "Group Insurance Coverage" is defined as benefit coverage provided to a group through a carrier authorized under Chapters 61A, 62A, 62C, 62D, and 62E to do business in the state. I \. 2. Requests for Proposals/Selection of Carrier/Contract Length a) Pursuant to M.S. 471.6161, Subd. 2, the ECSU will request proposals from, and enter into contracts with, carriers that in the judgment of the Board are best qualified to provide coverage. The request for proposals shall be in writing and at a minimum shall include: coverage to be provided, criteria for evaluation of carrier proposals, and the aggregate claims records for the appropriate period. Public notice of the request for proposals will be provided in a newspaper or trade journal at least 21 days before the final date for submitting proposals. b) Pursuant to M.S. 471.6161, Subd. 3, the Board shall make benefit and cost comparisons and evaluate the proposals using the written criteria. The Board may negotiate with the carrier on premiums and other contract terms. The Board must prepare a written rationale for its decision before entering into a contract with the . selected carrier. 2 r-"~ ". ~! . . \ . ~ : , ~oint Powers Agreement for Group Employee Benefits c) Pursuant to M.S. 471.6161, Subd. 4, group insurance contracts may not exceed five (5) years in length, including all extensions. The Board shall request proposals for coverage at feast once every sixty (60) months. Empfoyees may be added to an existing group pursuant to a joint powers agreement under section 471.59. 3. Rate Increases a) The Board will annually review renewal information as presented by the carrier, make recommendations and determine if requests for proposals are necessary. b) Rate increases will be determined on the basis of single coverage. c) The carrier shall notify each Participant and the Board of any changes in rates at feast sixty (60) days prior to the effective date of the rate change. Final rate adjustments will be effective the first day of the month following thirty (30) days written notice by the carrier. d) Pursuant to M.S. 471.616, Subd. 1, should the aggregate pool rate increase for single coverage equal twenty-five percent (25%) or more in a given contract year, the Board may solicit quotes for the pool. 4. Benefit Reduction: pursuant to M.S. 471.6161, Subd. 5, the aggregate value of benefits provided by a group insurance contract for employees covered by a collective agreement shall not be reduced unless the Participant employer and exclusive representative of the employees of an appropriate bargaining unit, certified under Section 179A 12, agree to a reduction in benefits. 5. Master Contract: The Board shall negotiate the master contract with the carrier selected for the pool on behalf of the Participants of the pool. Further, the Board will negotiate an operating agreement for the purpose of administering the master contract. C. Other Financial Risk Management Services 1 . The Board will determine the most cost-effective and appropriate manner in which to deliver other financial risk management services. Methods may include, but are not limited to, provision for staff consultation services and contracting for professional services with independent contractors. (RE: Krohnberg v. Pass, 187 Minn. 73, 244 N.W. 329; 1932). Bids and/or quotations may be requested but are not required. 2. Selection of Carrier. the Board will contract with the carrier that, in the judgment of the Board, is best qualified to provide the service. III. RIGHTS AND RESPONSIBILITIES OF THE BOARD A. Group Employee Benefits 1 . The Board shall negotiate master contracts for its own benefit and for the benefit of each of the Participants. A copy of the master contract shall be available for review by Participants. 2. Pursuant to M.S. 471.6161, Subd. 5, the Board has no authority nor authorization to change a policy or benefit of the Participant's group insurance policy without written authorization or request of the Participant. The policy of the Participant may be amended with respect to any matter relating to the insurance protection provided thereunder for the officers, employees and their dependents, and retired officers, employees and their dependents of any party by rider, amendment, or endorsement issued by the insurance 3 JOint Powers Agreement for Group Employee Benefits " - >> I : ': .. carrier by law, or with the written request of the Participant. The original of each such rider, amendment or endorsement shall be mailed or delivered by the carrier to the Board to be . attached to, and held with, the policy; and a copy of each such rider, amendment or endorsement will be fumished by the carrier to each of the Participants. 3. The Board shall secure quotes from carriers for entities requesting participation in the pool and respond to the carrier(s) with acceptance or rejection of their proposal within sixty (60) days of receiving necessary data. 4. The Board shall serve as liaison between representatives of the Participants to this agreement and the carrier, including general communications, problem resolution, transmittal of material, and pool meeting coordination. 5. The Board retains the right and responsibility, upon consultation with its Participants, to terminate any agreement into which it has entered on behalf of the pool. In the course of carrying out its responsibility, the Board may conduct other business negotiations consistent with group benefits and their delivery mechanisms. 6. The Board may negotiate, implement, and administer alternative financing arrangements which it determines best serves the interests of the Participants of the pool. 7. The Board shall determine the utilization of any monies acquired through discounts, credits, reserves, savings or in any other manner. B. Other Financial Risk Management Services 1. The Board may negotiate operating agreements for its own benefit and for the benefit of each of the Participants. Copies of the operating agreements shall be on file for review by any Participant upon request. . 2. The Board may request proposals from and enter into contracts with carriers/providers that in the judgment of the Board are best qualified to provide the service. Bids and/or quotations may be requested but are not required. 3. The responsibilities of the Board in the performance of other financial risk management services will be set forth in individual agreements. \ C. The Board, its authorized representatives, employees and designees shall have no duty or liability to any of the Participants, carriers, providers, or other financial risk management service providers with respect to the fees, premiums and/or contract charges, offers, acceptances or binders of coverage, cancellation notices, or other changes relating to the Participant's subscribers. The Board, its authorized representatives, employees and designees, and each Participant shall have no duty or liability due to negligence of other Participants, carriers, and providers. D. Upon request, the Board will assist in the resolution of disputes between a Participant and the carrier regarding claims, fees, premiums, and/or contract charges. E. The Board may recover the cost of administering services in the group employee benefits and financial risk management services by such means as deemed appropriate by the Board. IV. RIGHTS AND RESPONSIBILITIES OF PARTICIPANTS: A. Any Board Participant, through its goveming authority, may become a party to this agreement by executing and delivering this agreement to the Board. . 4 II' I; .' . \ . JOint Powers Agreement tor Group Employee Beneilts .. . \ B. Group Employee Benefits 1. Each Participant will execute necessary enrollment and renewal documents directly with the carrier for insurance protection for its officers and employees and dependents, retired officers and employees and dependents under their policy which shall be provided by the carrier. 2. Each Participant of the pool agrees to furnish employee data (census) pertaining to insurance coverage (I.e., name, date of birth, gender, single or family coverage status, salary, date of hire, benefits, class of benefit levels, experience records, medical information and other information required, etc.) directly to the carrier, as required. 3. The Participant shall remit, upon receipt of the appropriate bill from the carrier, contract charges to the appropriate authority prior to the due date. 4. The Participant will be responsible to notify the Board and the carrier at least forty-five (45) days prior to the effective date of any rate change of its intent to withdraw from the pool. C. Other.. Financial Risk Management Services 1 . The Participant agrees to execute and submit all necessary data required to perform the respective service requested to the appropriate parties as directed by the Board. 2. The Participant shall remit payment as designated by the Board for services as billed and when due. v. LENGTH OF CONTRACT AND TERMINATION A. This agreement shall continue for a periOd of four years. The effective date shall be the date both parties have signed this agreement. Any Participant wishing to withdraw from this agreement shall provide a minimum of forty-five (45) days written notice prior to annual renewal of said intent to the Board, and the service carrier/provider, unless otherwise specified in a given contract. B. Group Employee Benefits 1. Participants receiving a fifty percent (50%) or greater increase in single rates in a given policy year shall be allowed to solicit proposals without jeopardizing their participation in the pool. Once the Participant accepts the proposal, it is excluded from the pool for two (2) years and forfeits all residuals and claim to excess pooled dollars. If the Participant elects to reject all proposals and retain participation in the pool, the Board will determine the applicable rate for the Participant, which will be one of the following: a The Participant will be obligated to accept the actual formula rate as determined by the Participant's own utilization and the carrier's rating formula; or b. The Participant will receive a rate to be established by the Board. If the Participant's single insurance rate is increased by more than fifty percent (50%) in any given policy year, the affected Participant may withdraw from this agreement by giving written notice of its withdrawal to the Board and the carrier at least forty-five (45) days prior to the start of the policy year for which the rate increase is effective. 2. Should an individual Participant solicit proposals independently without a fifty percent 5 JOint rowers Agreement iOr llroup employee benefits '1 _: ';. __ 'I ~ ,~ (50%) increase in single rates in a given year, the Board retains the right to terminate said Participant's participation in the appropriate group insurance service. An individual '. Participant terminated under these conditions shall be ineligible to participate for a period of not less than two (2) complete policy years and forfeits any pool reserves or excesses. "Soliciting proposals" shall be defined as requesting and/or accepting proposals. 3. Any Participant wishing to withdraw from the pool at a time other than the date of renewal shall provide a minimum of ninety (90) days written notice of said intent to the Board and to the carrier. If a Participant withdraws from the pool without a fifty percent (50%) increase in a given year, the Participant shall be ineligible to participate for a period of not less than two (2) complete policy years and forfeits any interest in and rights to any pool reserves. 4. The Board retains the right to shorten or extend the policy/plan year should such action benefit the Participants. VI. LIABILITY OF PARTIES: Any Participant which is a party to this agreement holds the Board, its employees and its designees, and the other Participants which are a party to this agreement harmless. The parties agree to waive any rights to litigation from any dispute arising out of this agreement unless such action is the result of intentional wrongdoing. Contemplated in this provision are good faith efforts associated with the bidding, rating, claims, renewal, and administrative matters associated with the master agreement. Certain other responsibilities, including but not limited to collective bargaining disputes, benefit disputes, claims payments, employee ERISA and COBRA rights, claims, compliance with statutes, eligibility, premium and/or contract charge payments, retiree benefits, and enrollments, are the sole . responsibility of the respective Participant. Pursuant to all applicable state and federal laws, this agreement has been approved by the governing boards of the parties and is signed by the duly authorized officers of the parties. Minnesota Educational Cooperative Service Units (ECSU) BY: TITLE: DATE: BY: TITLE: DATE: ::'RTICIPANT NAM~~ TIR~~ BY: ~'~~t- TIRE: .. ...; ~i - DATE: /'0/ d-~/11 DATE: I D/ d}-I t:f 7 . 6