HomeMy WebLinkAbout3243 RESOLUTION NO. 3243
A RESOLUTION of the City Council of the City of
Bremerton, Washington, relating to establishing an individual
self-insurance health and welfare benefit program and
policies to administer the program.
WHEREAS, Chapter 48.62 RCW authorizes the governing body of local
government to individually self-insure health and welfare benefits; and
WHEREAS, self-insuring health and welfare benefits for City employees and
LEOFF 1 retirees offers several advantages including lower administrative costs than charged by
commercial carriers, greater control over the design of the.benefits program,easier access to
utilization and claims data, improving the employer's ability to evaluate health benefit costs and
implement cost containment measures, improved cash flow generated by keeping funds in-house
until needed for payment of claims, and avoidance of state insurance premium taxes-, and
WHEREAS, the City Council has established and submitted to the Washington
State Office of Risk Management and Washington State Auditor, a plan of management,
operation, and funding of an individual Self-Insured Health and Welfare Benefits Program
("Program") in accordance with Chapter 48.62 RCW; and
WHEREAS, pursuant to WAC 200-110-030, the City Council now wishes to
adopt the Program and a Human Resources Policy establishing program guidelines,and
requirements for administration of the Program,NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY RESOLVE AS FOLLOWS
SECTION 1. Program and Policy Adopted. The City of Bremerton Self-
Insurance Health and Welfare Benefits Program for City employees and LEOFF I retirees and
Human Resources Policy 3-40-12 establishing Program guidelines and requirements for
administration of the Program are hereby adopted as set forth in Exhibit A, attached hereto and
incorporated by this reference.
SECTION 2. Pohcv Amendments. The Human Resources Policy set forth in
Exhibit A may be amended by the City Council by motion or resolution.
SECTION 3. Severabihty. If anyone or more sections, subsections, or
sentences of this Resolution are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Resolution and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This resolution shall take effect and be in force
immediately upon its passage.
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Self-Insurance Health and
Welfare Benefits Program
PASSED by the City Council of the City of Bremerton, Washington this
day of krli ' 2015.
W
GRE HEELER, Council President
APPROVED AS TO FORM: AT EST:
RGER A. L V rney SHANNON CORIN, City Clerk
R\Legal\Legal\ ales\Current Active Files\L3remcrton Self-Insurance Health Program\Self-Insurance I lealth Program Resolution7 doc
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Self-Insurance Health and
Welfare Benefits Program
EXHIBIT A
CITY OF BREMERTON City of Bremerton Self-Insured Health and
HUMAN RESOURCES POLICY Welfare Benefits Program for City
Employees & LEOFF I Retirees
INDEX EFFECTIVE DATE APPROVED
Employer/Employee Relations REVIEW DATE
3-40-12 REVISED DATE
REFERENCE Chapter 48.62 RCW
Chapter 41.05 RCW
Chapter 3.32 BMC
Chapter 2.09 BMC
Chapter 2.76 BMC
Chapter 200-110 WAC
PURPOSE This policy sets forth program guidelines/requirements for the City of
Bremerton Self-Insured Health and Welfare Benefits Program (Program)
for City employees and LEOFF I Retirees.
PROGRAM 1 Comply with Laws The Program shall comply with all laws of the State of
Washington, including but not limited, to Chapter 48.62 RCW and Chapter
200-110 WAC. The person responsible for management and operation of
the Program shall be the Human Resources Manager("Plan Manager"). A
separate fund as set forth in Chapter 3.32 of the Bremerton Municipal Code,
is established to account for the employer and employee contribution.
2. Treasurer The City Treasurer, under the direction of the City Director of
Financial Services, and in accordance with her/his duties under Chapter
2 09 BMC, shall be the custodian of all Program moneys, and all assets of
the Program shall be invested only in accordance with RCW 48.62.111
The City Treasurer shall ensure the preparation and submission of accurate
and timely annual financial reports to the Washington State Office of Risk
Management pursuant to WAC 200-110-130.
3. Interfund Loans No interfund loans from assets held against liabilities for
unpaid claims and claim adjustment expenses may be made from Program
assets except for those amounts which are clearly inactive or in excess of
Program reserve requirements.
4. Program Requirements. The Program shall:
a. Pursuant to Chapter 3 32 BMC, establish and maintain reserves
in an amount equal to four(4) months of Program expenses or an
amount established by an actuary whichever is greater;
b. Maintain an aggregate stop-loss insurance policy with an
attachment point set at or below one hundred twenty-five percent
of annual expected claim costs; and
c. include mandated benefits that the state health care authority is
required to provide under RCW 41.05.170 and 41.05 180.
5. Third-Party Administrator. The Office of Human Resources may perform
claims administration services or may contract for claims administration
services with a qualified third-party administrator. All contracts shall
comply with the City's procurement procedures, codified at Chapter 2.76
Bremerton Municipal Code. Contracts with third-party administrators shall
be separate from contracts with actuaries and brokers. Pursuant to WAC
200-110-100, contracts for third-party administrator services must:
a. Require a complete written description of the services to be
provided, remuneration levels, contract period and expiration
date;
b. Provide for the confidentiality of the Program's information, data
and other intellectual property developed or shared during the
course of the contract;
c. Provide for the program's ownership of the information, data, and
other intellectual property developed or shared during the
course of the contract;
d. Provide express authorization that representatives of the Office of
Human Resources,the state auditor, the state risk manager, or
their designees,to enter the third- party administrator's premises
to inspect and audit the records and performance of the third-
party administrator which pertains to the Program and to obtain
such records electronically;
e. Require the compliance with all applicable local, state and federal
laws;
f Establish a monitoring and acceptance procedure to determine
compliance with third-party administrator contract requirements;
g Establish indemnification provisions and set forth insurance
requirements between the parties; and
h. Require that a written statement be submitted to the Program on a
form provided by the state risk manager providing assurance that
no conflict of interest exists prior to acceptance of the contract by
the self-insured program. (WAC 200-110-150(1)).
6. Description of Benefits Employees and retirees covered by the Program
will be provided with a written description of the benefits allowable
under the Program. Pursuant to WAC 200-110-060, the written
description shall include:
a. Applicable restrictions, limitations, and exclusions,
b. The procedure for filing a claim for benefits;
c. The procedure for requesting an adjudication of disputes or
appeals arising from beneficiaries regarding the payment or
denial of any claim for benefits; and
d. A schedule of any direct monetary contributions toward the
Program financing required by the employee.
7 Claims Process. The Program will include a written claims administration
process which includes claims filing procedures, internal financial control
mechanisms, and claim adjustment expense reports.
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8. Appeal Procedure. The Program will include a written claim appeal
procedure that contains, as a minimum, a time limit for filing an appeal, a
time limit for response, and a provision for the second level of review.
9. Claims Audit. The Office of Human Resources will obtain an audit of
claim reserving, adjusting, and payment procedures at least every three
years or as otherwise required by law. The claims audit must be conducted
by a qualified claims auditor not affiliated with the City or the Program,its
broker of record, or its third-party administrator. The review must be in
writing and identify strengths, areas of improvement,findings, conclusions
and recommendations. The scope ofthe claims audit must include claims
administration procedures listed in WAC 200-110-120(1)
10. Annual Report. The Office of Human Resources will electronically submit
an annual report to the state risk manager together with a list of contracted
third party administrators, actuaries, brokers, and consultants.
11. Actuaries, Brokers,and Consultants. Contracts with actuaries,brokers,
and consultants shall be separate contracts. All contracts shall comply with
the City's procurement procedures, codified at Chapter 2.76 Bremerton
Municipal Code, as hereafter amended, revised, or reenacted. All contracts
shall
a. Comply with the requirements set forth in Section 5 above; and
b. Contracts with brokers shall limit compensation to transactions
performed within the scope of the broker's license,and include
the following:
(1) A provision that contingent commissions or other form of
compensation not specified in the contract must not be
paid to the broker of record as a result of any self-insured
program insurance transactions;and
(2) A provision which requires the broker provide to the
Program a written annual report on a form provided by the
state risk manager which discloses the actual financial
compensation received The report must include
verification that no undisclosed commission was received
as a result of any such insurance transaction made on
behalf of the Program. WAC 200-110-150(2)(c)
12. Termination of Program. Prior to termination of the Program,the Plan
Manager shall, with the assistance and cooperation of the City Council,
ensure that adequate reserves exist or stop-loss insurance is in effect, or
both, to settle liabilities for unpaid claims and claim adjustment expenses.
Upon termination of the Program,the Office of Human Resources will
continue to submit annual reports until all claims have been paid.
AMENDMENTS This policy may be amended by the City Council by motion or resolution.
ATTACHMENTS None
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