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Resolution - 2010 - 10-19 - Adopt The Cobra Amendment - 05/24/2010 RESOLUTION NO. 10-19 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EAGLE, ADA COUNTY, IDAHO, ADOPTING THE COBRA AMENDMENT; AUTHORIZING THE MAYOR TO SIGN THE AMENDMENT; AND PROVIDING FOR AN EFFECTIVE DATE WHEREAS, The City of Eagle, Ada County, Idaho (the "City"), is a municipal corporation duly organized and operating under the laws of the State of Idaho; and WHEREAS, the City Council desires to enter into an agreement with National Benefit Services, Inc. to administer the COBRA Plan for the City; and WHEREAS, the City Council desires to adopt the COBRA Amendment and authorize the Mayor to sign accord ingly. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EAGLE, ADA COUNTY, IDAHO, as follows: RESOLVED, that the COBRA Amendment to the City of Eagle Health Reimbursement Arrangement HRA Plan (the Amendment) is hereby approved and adopted, and that the authorized representative of the City, is hereby authorized and directed to execute and deliver to the Administrator of the Plan one or more counterparts of the amendment. This Resolution shall take effect and be in force from and after its passage and approval. Dated this ~I/ M day of May, 2010 CITY OF EAGLE Ada County, Idaho ,",.....", '\ ,\ 'I, ........ or EAGf ..... ~:- ~ ....... ....../.:-... #, .:' "" ..- .... .#~* .. "-.- 0 0 R A l'r-. - . - I..' v.' : ...!: o~ . "ic ~ : : u .., : : : . 411I' __: . ... . ~' ~ . - . '. cC '-''''.0- - . ~p ~. ~ ~ ..:~0 ~<t.~.. ~ .: ":... .1'\ ...OR POIlI'...C\ ~ ...... , Y'r ...... ,v " '" -1 7'E o~ \ ,.... "" ~""" ""11..11" ATTEST: A fl (AA-t~'i, ~ '"'SHARON K. BERGMANN CITY CLERK/TREASURER C.\Documents and Settings\sbergmann\Local Settings\Temporary Internet Files\ContentOutlook\37SG690F\Resolution 10-19 COBRA AmendmenLdoc SERVICE AGREEMENT t iiS[Olner RVICES, LLC .,K Organ Izu! ion al ce COBRA SERVICE AGREEMENT Employer: City of Eagle Engagement. The above named employer ("Employer") hereby retains National Benefit Services, LLC ("NBS"), a Utah limited liability company, (collectively referred to as the "parties" herein), to provide certain non-discretionary, ministerial administrative services with respect to COBRA requirements as described in Schedule A attached to this Agreement. Relationship of the Parties. Because Employer is subject to federal requirements imposed by the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) to offer health benefit continuation coverage to certain individuals who would otherwise lose group health coverage; and because NBS is willing to provide administrative services to assist Employer in meeting the requirements of COBRA; the parties agree as follows: 1. Definitions. The following terms have the associated meaning as used in this Agreement, including any attachments. A. Group Health Plan-Any plan, fund or program established or maintained by Employer for the purpose of providing medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability or other enumerated benefits for its employees, former employees, or their beneficiaries. As used herein, "enumerated benefits" shall include any group dental, vision, or FSA plan which is established or maintained by Employer. B. Participant-Any Qualified Beneficiary or dependent of a Qualified Beneficiary who has elected to participate in COBRA by completing a COBRA emollment application, and has not been disqualified from participation because of non-payment of COBRA premiums. C. Qualified Beneficiary-Any employee or dependent who is covered under the Group Health Plan on the day before a Qualifying Event. D. Qualifying Event-Any of the occurrences listed below, which cause an employee or dependent who is covered under the Group Health Plan to be disqualified from group coverage: 1. Termination of employment of employee for any reason (other than for gross miscond uct) ii. Reduction of employee's work hours, including work stoppage and non-FMLA leave-of-absence iii. Employee's divorce or legal separation from spouse which disqualifies the spouse from coverage under the Group Health Plan iv. Employee's dependent child's disqualification from coverage under the Group Health Plan because the child loses dependent status under the terms of the Group Health Plan. v. Employee's dependent ceases to qualify for dependent coverage because employee becomes entitled to Medicare. vi. Employee's dependent ceases to qualify for dependent coverage because of the death of the covered employee. vii. Bankruptcy of the Employer may constitute a Qualifying Event for retirees (and their dependents) who are covered by the Group Health Plan. 2. NBS Services. NBS shall provide for Employer the services enumerated on Schedule A, which is attached and hereby incorporated into this Agreement. The provision of any services which are not included on Schedule A by NBS shall not constitute a modification of this agreement, and shall not guaranty the ongoing provision of such services. 3. Employer Obligations to NBS. Employer shall perform the responsibilities enumerated on Schedule C, which is attached and hereby incorporated into this Agreement. The failure to perform the Employer Obligations enumerated on Schedule C will constitute a material breach of the provisions of this agreement. Employer also shall pay the fees enumerated on Schedule B unless payment is arranged through a third party. 4. NBS Trust Account. Employer agrees that all funds and contributions under the Plan remitted to NBS shall be deposited to NBS's trust account. Employer agrees to be bound by the operating guidelines for such trust account as set forth herein. Such funds or contributions from Employer shall, at all times, be and remain subject to control of Employer until disbursed pursuant to the Plan. NBS shall pay the payments and reimbursements allowed under the Plan as well as fees and costs of NBS (if payment or reimbursement is not otherwise made or provided for), and any other amounts authorized by Employer. All such books and records, bank statements and canceled checks regarding the Plan and the trust account shall be retained and stored by NBS. The operating guidelines for such trust account are as follows: A. An administration fee of 2% of the entire premium for coverage under the Group Health Plan will be retained by NBS from payments received from participants and is not included as a part of the trust assets; SERVICE AGREEMENT (REv. 6.1.09) PAGE 2 OF 5 B. NBS will maintain accurate records of the amounts remitted to NBS with respect to the Plan so as to facilitate proper accounting of the contributions into and from the trust account; C. NBS will draw no check from the trust account on behalf of the Plan where such check would have the effect of drawing the balance for the Plan into a negative status; D. The name of the trust account will be in the name of NBS but designated as a "trust account" or as an "agency account" or other designation which indicates the agency position of NBS with respect to the trust account; E. NBS shall not be liable for any earnings on the trust account; and F. NBS shall maintain fidelity bonding in an amount of not less than $50,000 on all of its employees who handle or control funds or moneys in the trust account. 5. Access to Records. The records of the Plan maintained by NBS shall be open to examination by the Employer (the Administrator of the Plan), government regulatory agencies, or any other person or authorized representative who, by law or provisions of the Plan, is permitted access to such records. 6. Written Directions. So that adequate records may be maintained, the parties each agree to give directions, instructions and other communications, as needed, to each other in written form in the manner and location ideated below as acceptable for delivery and receipt of notice of termination under this agreement. 7. Nonexclusive Services. The parties hereto acknowledge and agree that NBS will be performing similar services and other types of work for other employee benefit Plans. Nothing contained in this Agreement shall grant to any party any right, title or interest in or to the business activities or opportunities of any other party or the power or authority to contract on behalf of the other parties other than as specifically provided in this Agreement. 8. Termination. Either party may terminate this agreement upon giving at least thirty (30) days prior written notice to the other party. NBS shall be entitled to the full payment of all fees for services rendered through the date of termination and for copy charges associated with any requests for Plan records or documents. Notice of termination may be delivered personally or by the following means: By Mail: COBRA at National Benefit Services P.O. Box 6980 West Jordan, UT 84084 By E-Mail: service@nbsbenefits.com By Fax: 866-909-6525 9. Indemnification. Employer agrees to defend, hold harmless and indemnify NBS from all liability arising from Employer's failure to satisfy the obligations under this agreement, and NBS agrees to defend, hold harmless and indemnify Employer from all liability arising from NBS' failure to satisfy the obligations under this agreement. The indemnification includes the expenses of defending or settling any court proceeding brought against NBS or Employer by any third party. Employer is not required to indemnify NBS and NBS is not required to indemnify Employer for any liability for which the other Party is found to be solely responsible. SERVICE AGREEMENT (REv 6.I09) PAGE 3 OF 5 10. Integration and Severability. This Service Agreement, together with all attachments hereto, represents the entire agreement of the parties, and supersedes any prior agreement as to the subject matter contained herein. In the event that any provision or portion of this agreement is declared void or unenforceable in a court of law, the remaining provisions of this contract shall remain binding upon the parties as if the void or unenforceable provision had not been included. No modification of this agreement shall be effective unless in writing and signed by both parties. 11. NBS Not a Plan Administrator or Fiduciary. By signing below, the parties acknowledge that NBS' provision of record-keeping and administrative services hereunder is not intended to make NBS a Plan Administrator or a Fiduciary to the Plan as those terms are defined in ERISA 9 3. The parties further acknowledge that this agreement does not grant to NBS any discretionary authority or control respecting management or administration of the Plan. The parties understand that NBS provides no accounting services outside of the record-keeping services required for the Plan. NBS does not provide legal services. Accordingly, all plan documents and forms completed by NBS should be reviewed by competent legal counsel. 12. Compliance/Breach. If Employer fails to comply with any of the terms and conditions contained in the Service Agreement, Employer will be in breach of contract and NBS shall have the right to cease immediately to provide any further services to Employer or Plan without waiving NBS' right to receive payment for services rendered and costs incurred. 13. Miscellaneous provisions: A. The nonprevailing party shall pay all costs and expenses, including reasonable attorney fees, incurred by the prevailing party in enforcing its rights under this agreement. B. Each party shall obtain the prior written consent of the other party concerning the content and plan of distribution of any public announcement, press release or advertisement concerning this agreement. C. NBS shall keep confidential, and may not disclose to any third person, all information that it has, obtains, develops or utilizes in connection with performing services pursuant to this Agreement, including but not limited to (a) all written or oral information, data, reports, opinions, conclusions, analyses, materials, and other work product, regardless of format, which are provided by Employer or developed for Employer; (b) any credit, legal, asset, economic, marketing, collateral files, donor lists, patient information and (c) the substance, terms, conditions or fact or any discussions between Employer and NBS concerning this agreement or any of the foregoing (collectively the "Confidential Information"). Both parties acknowledge that the restrictions relating to Confidential Information obtained pursuant to this Agreement are reasonable and necessary, that violation of these restrictions could cause damage to the other party, and that the other party will be entitled to injunctive relief against each violation. This section shall survive any termination, cancellation or expiration of this Agreement. SERVICE AGREEMENT (REv. 6.109) PAGE 4 OF 5 D. Paragraph headings are for convenience. It is agreed that the standard of care imposed upon NBS by this Agreement is to act with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. NBS shall be solely responsible for the conduct and control of the work to be performed under this Agreement by NBS and its representatives, subcontractors, agents or employees. The parties submit to the exclusive jurisdiction of and venue in the appropriate courts located in Salt Lake County, Utah. E. For provision of all services selected by the employer and provided by NBS, time is of the essence. Failure by the Employer to comply with the timing provisions specifically identified herein shall constitute a violation of the terms of this agreement. In the context of Employer's provision of information, in no event is the furnishing of information considered timely if it occurs beyond the deadline specified in the request for information. For most plans, NBS requires information necessary to perform year-end testing no later than one month following the end of the plan year. Other deadlines may apply depending upon the type of Plan, which will be identified with specificity in notices provided to the Employer. IN WITNESS HEREOF, the parties hereto have executed this Service Agreement on the date below written. EMPLOYER Signed: Title: Date: NATIONAL BENEFIT SER~ LLC Signed: -Pc &Q ~ ~ Title: President Date: Mav 5. 2010 SERVICE AGREEMENT (REv. 6.1.09) PAGE 5 OF 5 SCHEDULE A fioil'il COBRA SCHEDULE OF NBS SERVICES NBS shall provide the following services for Employer: A. Create and mail initial COBRA notification to Employer's employees and dependents when they first become eligible for coverage through the Group Health Plan B. Create and mail the COBRA notice and election packet to Qualified Beneficiaries within fourteen (14) days of notice from Employer that a Qualifying Event has occurred. C. Create and mail other notices to Qualified Beneficiaries when and as required under changes to federal law, including but not limited to any additional notices required under the American Recovery and Reinvestment Act of 2009. D. Upon receipt of COBRA election and payment of initial premium, emoll Qualified Beneficiaries in COBRA. E. Create and mail monthly premium statements to COBRA emollees. F. Receive Participant payments. G. Provide monthly reports to Employer which shall include: 1. Notification Report listing any Qualifying Events for which notices were mailed out for the previous month; ii. Department of Labor Report listing any general notices mailed to newly eligible employees for the previous month; m. Payment History Report listing any payments received from Participants for the previous month; lV. Termination Report listing any Qualifying Events consisting of termination for any reason for the previous month; and v. ARRA Premium Report (any reduced premiums received from ARRA-eligible Participants for the previous month. H. Serve as a COBRA non-discretionary information resource to Employer and Participants as follows: i. COBRA information is available online at www.nbsbenefits.com. Schedule B Page 2 of 2 H. You may also contact us at (801) 532-4000 (Salt Lake City Area) and (800) 274-0503, Monday through Friday, 8:00 a.m.-5:00 p.m., Mountain Time. I. Manage relationship with Participants and Employer through provision of telephone information and support regarding eligibility, emollment and billing. J. Perform all duties enumerated in this Agreement in accordance with COBRA requirements. K. Manage relationship with Participants to collect COBRA premiums and notices regarding late payments or termination of coverage. L. Transmission of insurance premium portion of payment received from Participant to Employer. Employer understands that the Services enumerated herein reflect the requirements and procedures dictated by federal law. If the requirements and procedures are changed by law, NBS may amend this Schedule to incorporate the changes in the law and provide such amendment to the Employer. Employer will be deemed to have accepted and approved each amendment hereto if Employer does not notify NBS in writingt within 30 days after receipt of the amendment that it objects to any provision of the Amendment hereto. Schedule B nee COBRA FEE SCHEDULE SET-UP Set Up............................................................................................................................ .............. ...Included · Includes Consultation and Toll-Free Phone Assistance, Customized Database for all Plan Types offered and Insurance Rates, Establish Web Site Access for Notification Takeover Fee for those Currently on COBRA ...................................................................................................................... Waived OneTime Charge. Includes Correspondence, Takeover of Billing, Notices (including ARRA) and Support Services. Initial Notification - All Employees ................................................................................................................................... Included · COBRA requires Description Material be sent to each Eligible Employee and Eligible Dependents. Fee Waived if Employer Certifies Compliance. ADMINISTRATION SERVICES Monthly Maintenance Fee........................................................................................................... . (Paid for by your Agent/Broker) · Includes Consultation and Support Services to Company and Employees, Insurance. Company Interface and Rate Changes, Computer Program and Web Maintenance, COBRA Legislative Updates, and Maintenance of Database Files. Qualifying Event Fee................................................................................................................................... .............................. Included · Notification and Election Form, Enrollment and Eligibility Processing, Monthly Premium Billing and Collection, Late Notices, Data Archiving and other Services such as Terminated Employees Phone Calls. Initial Notification - Newly Eligible Employees ................. ..... .................................. ............... .......................................... Included · Includes Initial Notification sent to each Newly Insured Employee and Covered Spouse, and Document Archiving. National Benefit Services, LLC appreciates the opportunity to satisfy your plan administration and consulting needs. We look forward to being of service Company Name City of Eagle Employer Signature Date t1~~~~ National Benefit Services, LLC Signature Date 8523 South Red?:vood Hiesl Jordan, trr 84088 '" 27,i-V503 w www.NBSbenefits.com COBRA.2KB Sched ule C C~usfo!'nf!r 'C~fJ're .. izalimlal F: enef COBRA SCHEDULE OF EMPLOYER RESPONSIBILITIES Employer shall have the following obligations to NBS: A. Make available to COBRA Participants the same Group Health Plan options as are available to Employer's current employees and dependents. B. Complete the COBRA initial notice form online on the NBS website www.NBSbenefits.com and submit to NBS when employees or dependents first become eligible for coverage under the Group Health Plan, within 31 days of the effective date for coverage under the Group Health Plan. e. Notify NBS of the following Qualifying Events no later than 30 days after occurrence on the NBS website www.NBSbenefits.com: a. death of a covered employee; b. termination or reduction of hours of the covered employee; c. the covered employee becomes entitled to Medicare; or d. the commencement of a bankruptcy proceeding of the employer. D. Notify NBS of receipt of notice from the Employee or Qualified Beneficiary of the Qualifying Events of divorce or legal separation of the covered employee from his or her spouse, and of a dependent child ceasing to be a dependent under the Group Health Plan within 60 days of occurrence of the Qualifying Event. E. Review NBS report of COBRA notices sent to confirm NBS was properly notified F. Reinstate Participants in the Group Health Plan G. Receive premium payments from NBS for COBRA participants and pay billing from applicable insurance carrier H. Terminate qualified beneficiary coverage with applicable insurance carrier based upon review of the email termination report and/or an email of a written notification provided by NBS 1. Communicate ALL transactions directly with the insurance carrier -NBS does not correspond with the insurance carrier directly J. Employer shall be responsible for all COBRA events prior to contract with NBS Schedule C Page 2 of 2 K. Pay NBS the costs associated with this agreement. Employer may arrange for payment by a third party, but should the third party fail to pay, Employer will be billed for any unpaid amounts. Employer understands that as a condition of NBS providing the services enumerated in Schedule A, Employer shall timely and accurately perform all of the enumerated responsibilities and provide the information required in this Schedule and any amendments thereto. NBS reserves the right to request additional information from Employer at any time. NBS shall be entitled to rely on any information provided by Employer as accurate, valid, and complete. Employer understands that the Responsibilities enumerated herein reflect the requirements and procedures dictated by federal law. If the requirements and procedures are changed by law, NBS may amend this Schedule to incorporate the changes in the law and provide such amendment to the Employer. Employer will be deemed to have accepted and approved each amendment hereto if Employer does not promptly notify NBS in writing within 30 days after receipt of the amendment that it objects to any provision of the Amendment hereto. ARRA COBRA AMENDMENT ARTICLE I PREAMBLE 1.1 Adoption and effective date of amendment. The Employer adopts this Amendment to City of Eagle HRA Plan ("Plan") to reflect certain provisions of the American Recovery and Reinvestment Act of 2009 (ARRA). The sponsor intends this Amendment as good faith compliance with the requirements of these provisions. This Amendment shall be effective on the date stated in Section 2.1 below. 1.2 Supersession of inconsistent provisions. This Amendment shall supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this Amendment. ARTICLE II COBRA (If Applicable) 2.1 Effective Date. The COBRA provisions under the ARRA Amendment are effective as of March 1, 2009. 2.2 COBRA provisions. The Plan's provisions concerning COBRA are amended as provided below to allow for (1) payment of reduced premiums and the provision of a second election period by certain COBRA qualified beneficiaries, (2) the provision for additional COBRA notices, and (3) an exception to the rules for crediting certain prior coverage. This amendment does not apply to a health flexible spending account. \. The COBRA continuation coverage provisions of the Plan shall be administered in accordance with the requirements of ARRA Section 3001 with respect to "assistance eligible individuals," as defined in ARRA Section 3001(a)(3). Notwithstanding any other Plan provision to the contrary, the Plan shall determine whether an individual has had a 63-day break in coverage for purposes of determining creditable coverage under the Health Insurance Portability and Accountability Act (HIPAA), in accordance with the terms of ARRA Section 3001. This amendment has been executed this Z,?,';'" day of ~~ ,2010. Name of Employer: City of Eagle BY~~ ARRA CERTIFICATE OF ADOPTING RESOLUTION The undersigned authorized representative of City of Eagle (the Employer) hereby certifies that the following resolutions were duly adopted by Employer on ,2010, and that such resolutions have not been modified or rescinded as of the date hereof; RESOLVED, that the Amendment to the City of Eagle HRA Plan (the Amendment) is hereby approved and adopted, and that an authorized representative of the Employer is hereby authorized and directed to execute and deliver to the Administrator of the Plan one or more counterparts of the amendment. The undersigned further certifies that attached hereto is a copy of the Amendment approved and adopted in the foregoing resolution. Date: Signed: [print name/title] ( \