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1991-064cooperly o ORDINANCE NO 91664 AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN THE CITY OF DENTON AND COOPERS & LYBRAND, INC RELATING TO PROFES- SIONAL SERVICES FOR A COMPREHENSIVE EVALUATION OF THE CITY'S EM- PLOYEE HEALTH INSURANCE PROGRAM, AUTHORIZING THE EXPENDITURE OF FUNDS THEREFORE, AND PROVIDING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I That the Mayor is authorized to execute an agree- ment between the City of Denton and Coopers & Lybrand, Inc rela- ting to a comprehensive evaluation of the City's Employee Health Insurance program under the terms and conditions contained within said amendment, a copy of which is attached hereto and made a part hereof SECTION II That the City Council hereby authorizes the ex- penditure of funds not to exceed Thirty-five Thousand Eight Hundred ($35,800) Dollars SECTION III That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the day of 1991 ATTEST JENNIFER WALTERS, CITY SECRETARY BY sbd_d APPROVED AS TO LEGAL FORM DEBRA A DRAYOVITCH, CITY ATTORNEY 3060L41091 AGREEMENT BETWEEN THE CITY OF DENTON AND COOPERS & LYBRAND, INC The City of Denton, Texas, a Municipal Home Rule City sit- uated in Denton County, Texas, hereinafter called "City", acting herein by and through its City Manager and Coopers & Lybrand, Inc , a professional corporation doing business in Texas, herein- after called "Consultant', hereby mutually agree as follows I SERVICES TO BE PERFORMED City hereby retains Consultant to perform the hereinafter designated professional services Consultant agrees to perform the following services A Conduct a comprehensive evaluation of the City's Employee Health Insurance Program with Sanus/New York Life and to develop minimum alternative plans and options The Con- sultant will rate alternatives and present written recom- mendations B In connection with performing the services described in Section I A , Consultant will provide the following ser- vices 1 Meet with local medical providers (doctors and hospi- tals) to negotiate arrangements for direct contracting with the City at favorable terms 2 Prepare for and direct discussion sessions with Denton Regional Medical Center, Denton Community Hospital and Denton Independent Physicians Association of Denton County 3 Investigate development of contract with appropriate tertiary care facilities located in the D/FW metroplex 4 Obtain and furnish City a preliminary contract from each provider or group of providers, as appropriate 5 Meet with Employee Insurance Committee (EIC) to deve- lop three plan alternatives for final analysis and actuarial projections by the consultant Perform actuarial projections and provide written and oral reports Rate selected plans based upon agreed-upon provider arrangements and plan design alternatives and actuarial projections and provide City with written and oral re- ports 8 Undertake and proceed to negotiate with Sanus for December 1, 1991 plan year renewal 9 Develop final draft contract with the appropriate hospitals, physicians and or physician groups and tertiary care facilities and submit to the City for finalization C Consultant shall exercise the same degree of care, skill and diligence in the performance of these services as is ordinarily provided by professionals under similar cir- cumstances II TERM OF AGREEMENT Consultant shall commence rendering services within ten (10) working days of receiving notification of contract approval Consultant agrees to adhere to the following project schedule Activity/Task Time Frame 1 Meet with 5 providers (hospital/physician groups) o Within 10 working days after contract approval Estimate 3 meetings for each provider at 2 hours per meet- ing Senior Consultant (Pro- ject Director) will attend and direct meetings 2 Data Analysis for Meetings Develop relevant historical providers predicted utili- zation data for each pro- vider Associate Actuary in Benefits and Compensation will assist in data analysis Estimate 8 hours per provider Project Director and Consul- tant's Actuary to review o Within 15 working days upon completion of meet- ings with Denton 3 Plan Design Alternatives (a) Project Manager develops three plan design alter- natives o Within 15 working days of completion of prior task PAGE 2 (b) Meet with EIC to discuss options (i) Prepare for meeting (ii) Attend meeting (iii) Update plan option per meeting 4 Rate Selected Plans and o Within 15 working days of perform actuarial projections completion of prior task Based upon results from EIC meetings, identifying --Hospital reimbursement --Physician reimbursement --Plan design --Employee demographics --Historical data Chief Actuary, who is cer- tified, will perform the actuarial projections and will rate the plans An estimated 16 hours for each plan will be required 5 Project Director Meetings o Within 15 working days upon completion of prior task (a) Prepare for and attend two meetings with City Council (b) Prepare for and attend two meetings with City Management 6 Negotiate with Sanus o Within 15 working days upon completion of prior task Project Director will negotiate with Sanus for the 1992 plan year Consultant shall complete, present and submit all contracts and documents, including a final written report reflecting findings and recommendations, not later than August 30, 1991 Deviation from this schedule is permitted only if prior approval is granted by City's Personnel Director or for reasons beyond the Consul- tant's control III COMPENSATION TO BE PAID CONTRACTOR City agrees to pay Consultant for the services performed here- under as follows PAGE 3 A Amount of Payment for Services City agrees to pay Consultant for the services performed hereunder as estimated below Estimated TASK C & L HOURS FEES 1 Meet with 5 providers (hospital/physician groups) Estimate 3 meetings for each 30 $ 4,000 provider at 2 hours per meeting Senior Consultant (Project Director) will attend and direct meetings 2 Data Analysis for Meetings Develop relevant historical 40 $ 3,900 predicted utilization data for each provider Associate Actuary in Benefits and Com- pensation will assist in data analysis Estimate 8 hours per provider Project Director and Chief 16 $ 2,300 Actuary for Coopers and Lybrand to review 3 Plan Design Alternatives Project manager develops 16 $ 3,200 three plan design alter- natives (a) Project Manager develops three plan design alternatives (b) Meet with EIC to discuss options (i) Prepare for meeting 8 19600 (ii) Attend meeting 4 (iii) Update plan option 8 1,600 per meeting 4, Rate Selected Plans and per- form actuarial projections PAGE 4 Estimated TASK C & L HOURS FEES Based upon results from EIC meetings, identifying --Hospital reimbursement --Physician reimbursement --Plan design --Employee demographics --Historical data Chief Actuary, who is cer- 60 $10,000 tified, will perform the actuarial projections and rate the plans An estimated 16 hours for each plan will be required 5 Project Director Meetings (a) Prepare for and attend $1,600 two meetings with City Council (b) Prepare for and attend $1,600 two meetings with City Management 6 Negotiate with Sanus Project Director will 16 $3,200 negotiate with Sanus for the 1992 plan year Total Hours 214 $33,800 Estimated out-of-pocket expenses $ 2,000 (Travel, FAX, Federal Express, etc ) TOTAL FEES & EXPENSES $35,800 Consultant will charge the City based on actual professional time spent and ex enses incurred In no event will the total project cost exceed 35,800 for Consultant's fees and expenses unless Con- sultant is requested to perform tasks outside the scope presented in the proposal If additional assistance is required from the Consultant, estimates of professional fees will be provided and presented to City management for approval before proceeding with any additional tasks PAGE 5 Consultant for services provided and expenses incurred prior to notice of cancellation Executed this the 4 day of Qh4 1991 CITY OF DENTON, TEXAS BY ATTEST JENNIFER WALTERS, CITY SECRETARY BY APPRO D AS 0 LEGAL FORM DEBRA A DRAYOVITCH, CITY ATTORNEY BY tl6eJ16IL-L) COOPERS & LYBRAND PAGE 7 B Dates of Payment The City will pay Consultant on a monthly basis, within thirty (30) days of receipt of invoices for completion of services provided for herein IV SUPERVISION AND CONTROL BY CITY It is mutually understood and agreed to by and between City and Consultant that Consultant is an independent contractor and shall not be deemed to be or considered an employee of the City of Denton, Texas for the purposes of income tax, withholdin1, social security taxes, vacation or sick leave benefits, worker s compensation, or any other City employee benefit The City shall have supervision and control of Consultant and any employee of Consultant while on City premises, and it is expressly understood that Consultant shall perform the services hereunder according to the attached Consultant's proposal at the direction of the City Manager of the City of Denton or his designee under this agreement V SOURCE OF FUNDS All payments to Consultant under this Agreement are to be paid by the City from funds appropriated by the City Council for such purposes in the Budget of the City of Denton VI INSURANCE Consultant shall provide at its own cost and expense work- men's compensation insurance, liability insurance, and all other insurance necessary to protect Consultant in the operation of Consultant's business VII INDEMNIFICATION Consultant shall and does hereby agree to indemnify and hold harmless the City from any and all damages, loss or lia- bility of any kind whatsoever to the extent proximately caused by the error, omission or negligent act of Consultant, its officers, agents, employees, invitees, and other persons for whom it is legally liable, in the course of the performance of this Agree- ment, and Consultant will, at its cost and expense, defend and protect the City of Denton against any and all such claims and demands The acceptance of Consultant's services by the City shall not operate as a waiver of such right of indemnification VIII CANCELLATION City and Consultant each reserve the right to cancel this Agreement at any time by giving the other party fourteen (14) days written notice of its intention to cancel If the agreement is cancelled before completion, the City agrees to compensate PAGE 6