Exhibit 1 - Agenda Information SheetCity of Denton
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement & Compliance
ACM: David Gaines
DATE: December 17, 2020
SUBJECT
Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation,
authorizing the City Manager, or his designee, to execute a Professional Services Agreement with Paradigm
Management Services, LLC, for the Workers’ Compensation Medical Case Management Services for the
Risk Management Department; providing for the expenditure of funds therefor; and providing an effective
date (File 7554 – Professional Services Agreement awarded to Paradigm Management Services, LLC, in
the one (1) year not-to-exceed amount of $453,280.00).
INFORMATION/BACKGROUND
Under Chapter 406 of the Texas Labor Code, public entities are required to provide workers’ compensation
benefits to their employees. Workers’ compensation provides income protection benefits, impairment
benefits, and lifetime reasonable and necessary medical benefits to employees injured on-the-job on a “no
fault” basis.
The City of Denton self-insures those benefits for our employees. However, as an added layer of protection
for catastrophic claims, the City purchases an excess workers’ compensation insurance policy from
Midwest Employer’s Casualty Company (MECC). MECC has an A.M. Best rating of A+ XV with over $2
billion in assets. The City’s policy with MECC has a $600,000 per occurrence, self-insured retention (SIR)
on the part of the City. This means that the City is responsible for the first $600,000 of any single occurrence
where one or more employees are injured. After the City has met the $600,000 SIR, then MECC will begin
reimbursing the City for further costs.
When a serious injury does occur to an employee, one option available is engaging a medical case
management company specializing in catastrophic injuries to help ensure the best possible recovery and
medical outcome for the employee.
In cases where the total estimated costs will potentially exceed the City’s $600,000 SIR, the City partners
with MECC to select a qualified case management company since the insurance carrier in many cases has
a much more significant potential cost exposure than the City.
Paradigm Management Services, LLC. (Paradigm) was recommended to the City by our workers’
compensation claims third-party administrator, our broker of record, and MECC. MECC uses Paradigm
exclusively for medical case management of their catastrophic workers’ compensation claims because of
their specialization in complex claims.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
After an extensive evaluation of the employee’s injuries, Paradigm calculates a contract price. This price
includes the entire complex medical case management of the claim for one year and guarantees Paradigm’s
assumption of all necessary and compensable medical costs and associated services to the family as needed
from the date of inception until the termination of this one-year contract.
In this situation, MECC agrees with the contract presented by Paradigm and has recommended acceptance.
As stated above, the City will be responsible for paying the full contract amount but will be reimbursed by
MECC for the total $453,280.
RECOMMENDATION
Award with a contract to Paradigm Management Services, LLC for Workers’ Compensation Medical Case
Management Services for the Risk Management Department, in a one (1) year amount not-to-exceed
$453,280.
PRINCIPAL PLACE OF BUSINESS
Paradigm Management Services, LLC
Concord, CA
ESTIMATED SCHEDULE OF PROJECT
This is a one (1) year contract.
FISCAL INFORMATION
These services will be funded from Risk Retention funds reimbursed by the City’s excess carrier MECC.
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: LLC Members
Exhibit 3: Ordinance
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Deby Skawinski, 940-349-7810.
Legal point of contact: Marcella Lunn at 940-349-8333.