HomeMy WebLinkAbout25D - AGMT - EMPLOYEE INSURANCEREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
AUGUST 16, 2016
TITLE:
EMPLOYEE GROUP INSURANCE
RENEWALS
(STRATEGIC PLAN NO. 7, 6)
v
CITY MANAGER
1:7 xgio7 j im 4 ki l T i7�Ti�C�T► I
CLERK OF COUNCIL USE ONLY:
_••:•
❑ As Recommended
❑ As Amended
❑ Ordinance on 1s' Reading
❑ Ordinance on 2nd Reading
❑ Implementing Resolution
❑ Set Public Hearing For
CONTINUED TO
FILE NUMBER
1. Authorize the City Attorney to prepare and authorize the City Manager and Clerk of the
Council to execute agreements for the renewal of dental, vision, employee assistance,
retiree health savings plan, long term disability, employee group life, and accidental death
and dismemberment insurance, subject to non - substantive changes approved by the City
Manager and City Attorney.
2. Authorize the City Manager to approve the rates as offered by CalPERS for 2017 Health
Premiums for medical insurance.
3. Authorize the City Manager and Clerk of the Council to recognize the ongoing agreement
with REACH Employee Assistance, Inc., executed in January 1, 2015 expiring on
December 31, 2017, subject to non - substantive changes approved by the City Manager
and City Attorney.
4. Authorize the City Manager and Clerk of the Council to recognize the ongoing agreement
with ICMA -RC as the Plan Administrator of the VantageCare Retiree Health Savings Plan
through December 31, 2017.
DISCUSSION
The City utilizes the services of two insurance brokers, Keenan & Associates and Cook
Insurance Services. Keenan is the broker of record on the life and accidental death and
dismemberment (AD &D) coverage, long -term disability (LTD) insurance through the carrier
Aetna, vision insurance through the carrier EyeMed, and the EAP Program through REACH for
all employees. Cook Insurance Service is the broker of record for dental coverage through the
carriers Delta and MetLife. These coverages are sent out to bid by the brokers on a regular
basis, usually in the summer of each year. Rates are finalized and issued in time for open
enrollment in September of each year. The new rates are effective annually on January 1. With
the exception of the REACH Employee Assistance Program, all insurances were reviewed for
2017 renewals.
25D -1
Employee Group Insurance Renewals
August 16, 2016
Page 2
The Employee Assistance Program assists employees and their eligible dependents in handling
problems that may be interfering with their performance on the job. Consultation for problems
such as alcohol and drug abuse, legal, marital and family problems are available. REACH
currently provides services under this program. Full time and part time employees are eligible to
participate in the Employee Assistance Program. We are currently in the second year of a three -
year rate guarantee through December 31, 2017
The City purchases its dental insurance through Delta Dental and MetLife. Delta rates will
increase by 1.9 percent and MetLife rates will increase by 5 percent, both of which are
guaranteed through December 31,2017.
The City purchases its vision insurance through EyeMed. The City does not contribute to the cost
of this coverage. Employees are responsible for the full cost of this coverage. The current plan
design was reviewed and enhanced to provide reimbursement for frames up to $120 every 12
months instead of every 24 months. The premium rates will increase by 7 percent in order to
provide this enhanced this benefit and will be guaranteed for 4 years through December 31,
2020.
The City purchases its medical insurance through CalPERS. The CalPERS health benefit
program was established in 1962 under the Public Employees Medical and Hospital care Act
( PEMCCA). In 1967 the program was expanded to allow all public agencies access to the
program. The City, through a resolution, amended its contract with CalPERS to allow it to
participate in PEMCHA in 1996.
CalPERS is the second largest public purchaser of insurance in the nation behind the Federal
government and currently provides insurance for all State employees, public colleges and
universities and to more than 1,000 school districts and local governments. To address the issue
of rising health care costs, market stability, access and choice for contracting agencies,
CalPERS utilizes a regional price approach grouping similarly located agencies into regions.
This approach and other polices are credited with maintaining lower health care premiums,
negotiating lower prices from hospitals, and negotiating savings on prescription drugs.
The change in CalPERS basic HMO health plan rates range from a decrease of 11.66 percent
for Health Net Salud y Mas to an increase of 18.87 percent for Blue Shield Access +, CalPERS
has eliminated the Blue Shield NetValue HMO plan in 2017. The average increase for all HMO
health plans will be 4.14 percent and the average increase for all basic PPO health plans will be
3.76 percent. The City's contribution toward medical for all bargaining units, except the
Police Officers Association (POA), is tied to the Kaiser rate. Since Kaiser rates will
decrease by 0.91 percent in 2017, the City will not incur any increase in costs for
employees enrolled in the CalPERS medical plans in 2017. Employees who chose plans
other than Kaiser will be responsible for any increase in cost above the City's contribution.
Attached are the CalPERS health premiums for 2017 (Exhibit 3).
25D -2
Employee Group Insurance Renewals
August 16, 2016
Page 3
Retirees are not included in the annual cost estimates. The POA maintains its own insurance
programs for medical, dental, vision and LTD coverage. The specific rates for those plans
sponsored by the City are listed below:
AETNA Life Insurance
Insurance Coverage
Current Insurance
Rate
Insurance
Renewal Rate 2016
Percent Change
Life Insurance
$0.102 per $1000
$0.102 per $1000
0.0%
Accidental Death &
$0.352 per $100
$0.352 per $100
0.0%
Dismemberment
$0.020 per $1000
$0.020 per $1000
0.0%
AETNA Long -Term Disability
Group Coverage
Current Insurance
Insurance
Percent Change
Employee
Rate
Renewal Rate 2016
1.9%
Management
$0.352 per $100
$0.352 per $100
0.0%
Employees
$8.78
$8.78
0.0%
130 day wait
Employees
$15.93
$15.93
0.0%
60 day wait
Dental Plans
Type of Coverage
Delta
Current Rate
Delta Renewal
Rate 2016
Percent Change
Employee
$51.58
$52.56
1.9%
Employee Plus Family
$127.04
$129.44
1.9%
25D -3
Employee Group Insurance Renewals
August 16, 2016
Page 4
Type of Coverage
MetLife Dental
MetLife Dental
Percent Change
Percent
Current Rate
Renewal Rate 2016
$1318.06
Employee
$26.38
$27.70
5.0%
Employee Plus Family
$45.09
$47.34
5.0%
EyeMed Vision Plan
Type of Coverage
Current Insurance
Insurance Renewal
Percent Change
Percent
Rate
Rate 2016
$1318.06
Employee
$7.75
$8.29
7.0%
Employee & one
$14.71
$15.75
7.0%
Dependent
$1556.90
$2023.97
18.87%
Employee & two or
$21.63
$23.15
7.0%
more Dependents
$1231.00
- 11.66%
Health Net SmartCare
HMO
CaIPERS Health Program
Plan
Employee
Onl
Employee &
one Dependent
Employee & two
or more
Dependents
Percent
Anthem HMO Select
$659.09
$1318.06
$1713.48
3.83%
Anthem HMO Traditional
$799.15
$1598.30
$2077.79
12.43%
Blue Shield Access+ HMO
$778.45
$1556.90
$2023.97
18.87%
Blue Shield NetValue HMO
This Plan is no longer offered in 2017
Health Net Salud y Mas
HMO
$473.46
$946.92
$1231.00
- 11.66%
Health Net SmartCare
HMO
$537.20
$1074.40
$1396.72
-10.01%
25D -4
Employee Group Insurance Renewals
August 16, 2016
Paqe 5
Kaiser HMO
$599.54
$1199.08
$1558.80
- 0.91%
Sharp HMO
$614.46
$1228.92
$1597.60
9.46%
United Healthcare HMO
$549.76
$1099.52
$1429.38
11.29%
PERSCare PPO
$802.24
$1604.48
$2085.82
5.35%
PERSChoice PPO
$714.43
$1428.86
$1857.52
4.49%
PERSSelect PPO
$633.46
$1266.92
$1647.00
1.32%
PORAC safet members
$699.00
$1467.00
$1876.00
12.00%
Employee Assistance Program — REACH Employee /Associate Assistance
STRATEGIC PLAN ALIGNMENT
Approval of this item supports the City's efforts to meet Goal 7 - Team Santa Ana, Objective #6
(Provide a positive workplace environment that supports the health of its employees and
celebrates its successes).
FISCAL IMPACT
The annual cost of each plan may vary depending on changes in the number of employees
enrolled during the year. The projected annual costs for the City are calculated using current
enrollment as of July 2016. The projected annual costs for POA insurance coverage will now be
25D -5
Current Rate based
Insurance Renewal
Type of Coverage
on 1460 employees
Rate 2016 based on
Percent Change
1460 employees
Full Time Employee
$1.85 /employee
$1.85 /employee
0.0%
(970 full time)
(970 full time)
Part Time Employee
$1.25 /employee
$1.25 /employee
0.0%
(490 part time)
(490 part time)
STRATEGIC PLAN ALIGNMENT
Approval of this item supports the City's efforts to meet Goal 7 - Team Santa Ana, Objective #6
(Provide a positive workplace environment that supports the health of its employees and
celebrates its successes).
FISCAL IMPACT
The annual cost of each plan may vary depending on changes in the number of employees
enrolled during the year. The projected annual costs for the City are calculated using current
enrollment as of July 2016. The projected annual costs for POA insurance coverage will now be
25D -5
Employee Group Insurance Renewals
August 16, 2016
Page 6
calculated using current enrollment and will no longer be based on the number of budgeted
positions.
Coverage for POA Members (Sworn and Non - Sworn)
Aetna Life*
POA LTD Insurance
POA Dental
POA Medical
REACH (EAP Provider)*
Total Annual Cost
25D -6
CY 2017
CY 2016
511 Budgeted Positions
$
14,962
$
404,712
$
551,880
$
7,495,848
$
11,100
$
8,478,502
25D -6
CY 2017
457 POA Members
Difference
$ 13,381
$
-1,581
$ 361,944
$
- 42,768
$ 493,560
$
- 58,320
$ 7,425,336
$
- 70,512
$ 10,145
$
-955
$ 8,304,336
$
- 174,136
Employee Group
August 16, 2016
Page 7
Insurance Renewals
Coverage for SEIU, CASA, SAMA, EM, PMA, PTCS and Council (City Administers)
Aetna Life /LTD Insurance*
Dental Carriers*
CalPERS Medical*
REACH (EAP Provider)*
Total Annual Cost
*City administered insurance
Difference
$ -6,018
$ -2,724
$ - 161,548
$ 955
$ - 169,335
Funds in the amount of $7,524,404 are budgeted and available in the Personnel Services
Employee Benefits account (account no. 08109053 - 64010) to pay for City administered
insurance coverage *. Funds in the amount of $8,366,640 are budgeted and available in the
Employee Benefits account (account no. 08109053 - 64010) to pay for the insurance coverage
administered by the POA. The total budgeted amount of $15,891,044 is available in Fiscal Year
2016 -2017. The balance will be budgeted in Fiscal Year 2017 -2018.
EdGvard S;irecto a a
Y
Executive r
Pe rsonnel Services
Exhibits: 1.
CY 2016
CY 2017
530
Participants
517 Participants
$
126,250
$ 120,232
$
404,677
$ 401,953
$
7,035,566
$ 6,874,018
$
17,784
$ 18,739
$
7,584,277
$ 7,414,942
Difference
$ -6,018
$ -2,724
$ - 161,548
$ 955
$ - 169,335
Funds in the amount of $7,524,404 are budgeted and available in the Personnel Services
Employee Benefits account (account no. 08109053 - 64010) to pay for City administered
insurance coverage *. Funds in the amount of $8,366,640 are budgeted and available in the
Employee Benefits account (account no. 08109053 - 64010) to pay for the insurance coverage
administered by the POA. The total budgeted amount of $15,891,044 is available in Fiscal Year
2016 -2017. The balance will be budgeted in Fiscal Year 2017 -2018.
EdGvard S;irecto a a
Y
Executive r
Pe rsonnel Services
Exhibits: 1.
Delta Dental Premiums
2.
MetLife Renewal Letter
3.
EyeMed Vision Renewal Chart
4.
CalPERS 2016 Premiums
APPROVED AS TO FUNDS AND ACCOUNTS:
z
Francisco Gutierrez
Executive Director
Finance & Management Services Agency
5. REACH Employee Assistance Agreement
6. VantageCare RHS Agreement
25D -7
25D -8
CITY OF SANTA ANA
BENEFITS & RATES
DELTA CLIENT #599
CURRENT RATES jffective 01/01/2016 to 12/31/2016)
Delta Dental PPO
One Party
$51.58
Billed
PPO
T Non -PPD
____
Subsidized
Diagnostic and Preventive
100%
100%
Copoyments
Basic
Crowns and Cast Restorations
80/20
50/50
75125
50/50
_
$55.49 i
Prosthodontics
50/50
I 50/50
_
Per patient per calendar year
$25
$50
Deductibles
Perfamlly per calendar year
$50
$100
&Pfro
exempt m deductible?
Yes
Yes
Maximums
__D -
Per patient per calendar rear
_
—2)
$11000 _
ggelimitations
Children (years o)a a
26
26
CURRENT RATES jffective 01/01/2016 to 12/31/2016)
Billed
One Party
$51.58
Billed
7WO Party+
$127.04
____
Subsidized
One Party
- - -- $3.91
Subsidised
Two Party+
$9.62
Total
One Party
_
$55.49 i
One Party
Two Part+
Two Part y+
$136.66
RENEWAL RATES Effective 02 /01/2017 to 12/33/2017)
Billed Rate Action
1.90%
Billed
_
One Party
Two Parry+
— -- $52.56 -�-
$129.44
Subsidized Rate Aedon
5.28%
Subsidised
One Part y
Two Party+
$7.22
Total
Total Rate Action
8100%
$55A9
$136.66
One Party
Two Part+
SUGGESTED COBRA RATES jffective 01/01/2017 to 12131/2017)
One Party
$55.49
Two Party
$105.58
Three Party*
$158.37
A Note About COBRA Rates
As part of Delta's commitment to assist employers In complying with the Consolidated Omnibus
Budget Reconciliation Act (COBRA), we are providing a suggested three -step rate structure for those
groups having a Super - Composite rate, a Two Party+ rate structure or for a self - funded contract. The
following recommended rates are the rates which the group may charge a COBRA eligible on a three -
step rate structure. The rates do not Include the 2% allowable employer charge for the administration
of COBRA. Please note that Delta Is not responsible for the billing for the individual COBRA eligibles.
Self-funded groups will continue to be charged by Delta for claims plus administration for ALL eligibles
including COBRA eligibles, Likewise, risk groups will continue to be charged the rate for ALL eligibles
under their plan, including COBRA eligibles.
EXHIBIT 1
25D -9
5/20/2016
25D -10
;t tl,
June 25, 2016
Dick Cook Insurance Services
Attn: Dick Cook
814 Hibiscus Way
Placentia, CA 92870
Re: City of Santa Ana
Renewal — January 1, 2017
Dear Mr, Cook,
MetLife appreciates the opportunity to be a part of your benefit program. This letter confirms
your renewal for the 2017 plan year.
In determining the rates for the coming plan year, we have evaluated your plan experience,
taking into account the credibility of the experience and the demographics of your group. Our
objective in the renewal process is to identify rates that will maintain the overall financial stability
of your benefit program.
We have set the following rates for the coming year:
Coverage
Current
Renewal
Changeln
Em to ee onl
Rate/Fee
RatefFee
Rate /Fee
Em to ee + Family
DHMb
Em to ee onl
Em to ee + Family
The rates shown above assume your existing plan design, contribution structure and group
demographics remain the same.
Please do not hesitate to contact me at 949 -471 -2310 if I may answer any questions or assist in
any way.
Once again, thank you for the privilege you have extended to us. You are the reason we are in
business. We look forward to continuing our relationship in the months and years ahead.
Sincerely,
Nick Sala
Account Executive
Dental HMO plans in California, Florida and Texas are available through a domestic company In the applicable state named
SafeGuard Health Plans, Inc. The SafeGuard companies are part of the MetLife family of companies.
Request to Notify Ai.isk , Residents of Ito pending Coverago, and! or Premium Changes
Urnx i AldSka 9au t; . ,3t esidw i o A.aok n2..... t utftei Q,
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i' Ui
RECOMMENDED FOR APPROVAL:
Edward Raya
Executive Director Personnel Services
President
25D -12
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25D -14
6117/2016
Monthly Premiums for Contracting Agencies
Other Southern California Region
Fresno, imperial, Inyo, Kern, Kings, Madera, Riverside, Orange, San Diego, San Luis Obispo,
Santa Barbara, Tulare
Actives and Annuitants
Effective Date: 1111201 7 -1213l/2017
r
am HMO Select
Dm HMO Traditional
Access+,
h Not Salud y Mis
,h
at SmariCare
or Permanents
i Choice _.._
i Select
r senior Adv /Dore
Choice Mod Supp
Select Mad Supp
Caro Med Supp
C Med Supp
Employee Plan Cade ee I Party I Plan Coda Employee Plan Cotla yee 8 j Party I Empl yes 8. Party
n
Only Rate 1 Dependent Rate Z} Dependents Rata
659.03 478 1 1
799.15 4071 1
778.45 142 1 1
473.46 412 1 1
537.20 414 1 1
599.54 308 1 1
714.43 323 1 1
633.46 0821 1
802.24 3281 1
699.00 2071 1
614.46 420 1 1
549.76 4321 1
1,598,30
407 2
2
1,556,90
1422
2
946.92
4122
2
1,074.40
4142
2
1,199.08
3082
2
1,428.86
3232
2
1,266.92
0822,
2
1,604.48
32821
2
1,467.00
207 2
2
1,228.92
420 2
2
1,099.52
432 2
2
Employee
Only
Plan Code
Party
Rata
.Employee&
1 Dependent
Plan Code
Party
Rate.
$300.4B
3181
4
$600.96
387 1
5
1,396,72
492 1
4
. 6
492 2
5
353.63
'315;;;k-;;
3
707.26
333 2
5
353.63.
3283
4
6
083 2
5
affT 6
338 1
1 4
464.00
2081
4
324.21
386 1
4
324.21
387 1
4
924.00
1208 2
1 5
648.42
386 2
5
648.42
387 2
5
1,713.48
4783
3
2,077.79
4073
3
2,023.97
1423
3
1,231.00
4123
3
1,396,72
4143
3
1,558,80
3083
3
1,857.52
3233
3
1,647.00
0823
3
2,085.82
3283
3
1,876.00
2073
3
1,597.60
4203
3
1,429.38
4323
3
r
aploya onto
1Pie. Code
Ra�
901.44
492 3
6
060.89
3333
6
060.89
0833
6
169,28
3383
6
477.00
2083
6
97 .
3
6
972.63 1 387 3
Employee in M &
Dependent In Bate Employee tsI PadY p
1 Oepondanr in D Plantodo Rate xt 1lapandonix An a Plan Code Rate A Dependent to M Plan Cods a
1 +0ependants lRb. -
ad AdVIPPO Naeltninontal Ilion
EXHIBIT 4
'Dental benefit Is an additional $14.33 per member per month premium. You will be billed directly for this amount.
2Dental and Vision coverage is an addilonal $27.47 per member per m2W.46 wlll be billed directly for this amount.
Kaiser Senior Adv /Dental'
502 4
7
1,259.74
602 5
8
960.68
502 61
9
PIERS CboicelMed Supp
1,068.06
34
1,496,7
8
1,135.92
348 6
9
PERS Select/ModSupp
987.09
354 4
7
354 5
8
1,087.34
354 6
9
PERSCarolMod Supp
1,192.00
r
7
1,673.34
3
1,260.86
3596
9
PORACIMod Supp
_. 0
158 4
7
1,641.00
1585
8
0
1586
9
UnitedHealthcare
Group Mod AdvIP On7
873.97
3734
7
1,203,83
3735
8
978.28
3
United care'
873.97
3744
7
1,203.83
3746
8
978.28
3746
9
ad AdVIPPO Naeltninontal Ilion
EXHIBIT 4
'Dental benefit Is an additional $14.33 per member per month premium. You will be billed directly for this amount.
2Dental and Vision coverage is an addilonal $27.47 per member per m2W.46 wlll be billed directly for this amount.
25D -16
A -2014- 176 -01
REACH EMPLOYEE ASSISTANCE PROGRAM SERVICES AGREEMENT
This Employee Assistance Program Services Agreement is made and entered into as of January
1, 2015, between REACH Employee Assistance, Inc. (hereinafter referred to as "REACH "), a
California corporation, and the City of Santa Ana, a charter city and Municipal Corporation
organized and existing tinder the Constitution and laws of the State of California (hereafter
referred to as "City ",)
Whereas REACH is engaged in the Enployee Assistance Program Services business and desires
to service City, and
Whereas City desires to obtain the Employee Assistance Program Services of REACH.
It is therefore agreed as follows: This is a contract for service outlining the duties and
responsibilities of REACH Employee Assistance, Inc., to the City of Santa Ana.
I, Below are listed the Scope of Services provided by the REACH:
f i 1. Assessment /CounselingLReferral for Employees and Dependents
A total assessment will be administered for a well-rounded analysis of the client's problem.
Employees and immediate family members are entitled to up to three (3) sessions per
}r p l incident every six (6) months. REACH provides professional assessment /counseling to the
U) point of referring the client to an outside counseling professional or agency. In addition,
c, J` S N REACH provides follow -up consultation, The number of sessions offered, within this limit,
will be at the sole discretion of the REACH counseling staff.
w The City will be assigned a REACH liaison person. REACH provides quality, experienced
4-
counselors knowledgeable in assessment skills to provide personal counseling to employees
and immediate family members. REACH also provides qualified and experienced staff to
assist management on all aspects of Employee Assistance Program. Dr Marcus Dayhoff is
achninistratively, operationally and clinically responsible for REACH.
A. Confidentiality and Release of Information
As a general ride REACH shall not disclose to the City the ,identity of City employees or
immediate family members of City employees who elect to participate in the REACH
Program offered under this Agreement.
Exceptions -
Notwithstanding the above, PLACH shall release to the City in writing the following
information on employees who have been referred into the REACH Program as a condition
of employment with the City:
A) Whether employee has agreed to participate in the Assistance Progran).
EXHIBIT 5
25D -17
B) List of all appointments of employee kept and missed, together with reason, if any, for
missing the appointment.
C) Submission of the employee's anticipated treatment plan as a participant in the Program.
This plan shall consist of the following:
1) The anticipated number of visits, appointments, or sessions requested of the
employee,
2) The type of therapeutic procedures in general terms that the employee is to
receive during the employee's participation with the REACH Program or the
treatment provider(s).
3) Description of the treatment service provider the employee is referred to by
REACH.
4) Any other information not contained in the employee's treatment service provider
medical record deemed appropriate by the City to evaluate the employee's participation
in the Assistance Program.
D) Any conclusion or opinion of REACH or employee's treatment service provider that the
employee is limited or restricted in his/her ability to perform the employee's job duties, such
limitation may be, but not necessary, limited to physical, psychological, or medical reasons.
E) Any conclusion or opinion of REACH or employee's treatment service provider that
employee's participation may necessitate employee's absence from the City.
F) That employee has failed, refhsed, or otherwise has discontinued to proceed with the
REACH Program or any treatment service provider.
G) Report consisting of the following:
1) Diagnosis
2) Summary of treatment or therapeutic procedures
3) Disabilities, limitations, or restrictions of employee
4) Recommendation on further treatment.
The above information shall be considered confidential information not subject to disclosure by
REACH unless the City employee has on file with REACH and any treatment service provider in the
REACI-3 Program an irrevocable authorization(s), RELEASE OF INFORMATION to the City.
On receipt of the City's request for the above information, REACH shall notify in writing, the City
employee of the City's request.
NOTE: The City agrees that in cases where an employee agrees to be referred by management to
REACH, the Supervisor will seek written permission from the employee to inform REACH of the
circumstances leading up to the referral.
The City agrees to in no way insist or demand confidential information iron the REACH program on
specific individuals who do not want their information released to tine City.
25D -18
Service Providers: Exceptions will also be made in cases when the employee and /or immediate family
members sign a written release authorizing the release of information by REACH to one or more
agreed upon service providers.
2. Definitions
a. "Client" shall mean an employee or his/her immediate farnily member participating in
the REACH EAP program.
b. "Treatment Service Providers" or "Service Providers" shall mean an outside counseling
professional or agency, referred by REACH, whose services will be paid by the client.
Counseline Ilours
REACH provides counseling hours from 8:00 a.m, to 8:00 p.m. Monday through Thursday,
rriday 8:00 to 5:00 p.nn, and will respond appropriately and effectively to employee needs.
Every attempt will be made to see management referrals and employees in crisis as early as
possible to the time of calland no later than 24 hours (during business bonus) of the trill being
made. All other clients will be seen within 48 hours of the call being made.
The City agrecs to provide REACH with names and telephone numbers of liaison individual(s)
at the City who can be contacted in cases of emergencies and keep REACH appraised of
changes in contacts and telephone numbers.
4, 24 &our Availability, 7 days a week
REACTI provides confidential intake and psycho- social assessment and counseling to the point
of referral to employees and their immediate family members with a 24 hour telephone service.
REACH assures that no calls go unanswered and that all crisis cullers receive courteous and
prompt service. During non - business hours, all calls answered by the REACH answering
service will be connected to the on -call counselor. The REACHline number is 1- 800 - 273 -5273.
5, location
Employees and family members will have a choice of counseling tither at one of our several
conveniently located offices or at one of our service provider's office,
6. Referral Network
When necessary, REACH will refer employees and dependents to appropriate, cost effective,
geographically convenient and high quality services provided by individuals and agencies
which have been screened by our staff.
Mo nit orlug/Pollow -11)
REACII will monitor and follow -up as long as appropriate all people referred by the REACH
progriun to outside individuals and community resources to assure the problem is resolved and
25D -19
that the person is satisfied with the quality of referrals. In cases of' management ref•earals,
REACH will also follow -up regularly with 'the City on status ofjob performance.
S. Service Utilization Reports
REACH will provide quarterly confidential reports on service utilization, aggregate client
profiles, assessed problems and outcome at case closure. Customer satisfaction reports will be
available upon request by the City.
9. Benefits
The City agrees to provide REACH with copies of all the City employee benefit plans and
appraise REACH of all changes as they occur.
10. Avoiding Conflict of Interest
REACH agrees to avoid conflict of interest by providing up to three (3) referrals to clients
based on competency, geography and the most cost effective modality to deal with the client's
problem(s). No referrals will be made to the private practices of REACH counseling staff
members or to any private practitioner and /or agency with whom a REACH counselor has an
economic relationship. Only the City can make exceptions to this rile.
11. Alcoholism and Chemical Denendenry Intervention Services
REACH provides job related alcoholism and chemical dependency intervention services as
required.
12. Policy and Procedure
The City agrees to consider implementing a policy and procedure statement on employee
assistance when appropriate. REACH will provide technical assistance to the City staff in
writirgg a policy and procedure statement on employee assistance.
13. Trairrin?
REACH will provide Management and Supervisory training sessions annually. It is
recommended that no more than 25 managers /supervisors attend each session. The purpose of
these training sessions is to make managers and supervisors aware of City employee assistance
program policy and procedures, of how to identify poor job performance as it relates to
personal problems and to familiarize them with the processes of referrals and follow -up. The
effectiveness of each training session will be evaluated.
iel. Manaaci tent Guidelines
REACH supplies on request Management and Supervisor Employee Assistance ;Program
guidelines for iachrsion in City personnel management guidelines.
25D -20
15. Manager/Supervisor Consultation and Assistjrncc
REACH will assist managers and supervisors calling REAC linc for consultation on how to
deal with specific employee incidents or problems, which may require EAP intervention. The
City agrees to encourage managers and supervisors to take advantage of this consultation
service.
16. Program Promotion
'the City agrees to support REACH in developing a yearly EAP program promotion plan.
a. TAY orientation classes for employees in groups of up to 50 will be available to the
City as a means of introducing City EAP policy and procedures and utilization of REACH
set-vices.
b. "Mauch & Learn" presentations will be conducted periodically upon request by the
City, at City locations to maximize utilization of REACH services.
C. REACH brochure & REACIIIhre cards will be supplied to the City for distribution
to all employees.
d. REACII Frontline will be electronically supplied to the City quarterly for distribution
to all supervisors.
e, REACIIIine.com will be available for ordine use to all employees and family
members. Employees will be supplied a password as mentioned on RE, ACI-I employee
brochure for online secure area access.
f. REAC1I1ine Posters will be supplied from time to time to the City for posting on
official staff bulletin boards.
g. Originals of promotional materials for inclusion as short articles in internal staff
newsletter or as check stutfers will be supplied upon request by the City.
h. REACH staff will participate at the City's employee benefit fair upon request.
i. REACH will assist with drafting of any LAP related materials to announce REACH
services to employees.
17, Ouality
REACH conducts on -going quality assurance audits on all aspects of the program f-oul
inception to end of the contract year. REACH will supply the City with quarterly reports.
IL 111E CITY CP SANTA ANA RPALI7- PS AND UN 12STANDS
5
25D -21
I. Top management support and comminnent is essential to the success of the REACH Employee
Assistance Program at the City of Santa Ana.
2. REACH is a totally confidential program. The City will only be aware of employees referred
officially by management and information about that employee will not be .released without
written consent of the employee.
3. REACH will not, in all cases, be able to resolve the employee's or dependent's problems) in
the set number of counseling sessions. In site]) cases the employee or 'family member will be
referred to quality, cost effective resources available within the community.
4. Employees and dependents will not be charged for the services provided by REACTS, if
referrals are necessary, those referrals may result in additional cost to the City's benefit plan and
may result in added costs to the employee or family member.
5. The REACH program is made available to all full- and part -time employees and their
dependents. The REACH benefit starts on the first day of employment.
6. it is anticipated that the yearly employee utilization rate will be a minimum of 6-8 %. The
REACH promotional program will aim at achieving at least this utilization rate.
TIT. TERMS AND CONDITIONS
1. The Agreement period will extend from January 1, 2015 to December 31, 2017.
2, The total cost to the City for the services to be provided to the City and its employees by
REACH under this Agreement shall be $1.85 per full time employee/month, and $1.25 per
part time employee /month. While the number of persons employed by the City may fluctuate
from time to time during the term of this Agreement, the City agrees the amount of
compensation payable to REACI:I during the term of the Agreement shall be based on the
number of persons employed by the City at the beginning of the month invoiced for. The
beginning employee count will be 970 IilT and 490 PIT,
3. The City will be invoiced on the first of each month for that month's installment. Checks will
be made payable to REACH Employee Assistance, Ine. and mailed to 650 N. Rose Drive,
050, Placentia, CA 92870 - Attn.: Accounts Receivable.
4I, The City will make payment within 30 clays from the date of the receipt of the invoice from
REACH Employee Assistance, Inc.
5. The City or REACH has due right to cancel this contract at any time without cause by giving 60
days written notice to that c.ffect,
6, REACH Employee Assistance, Inc. agrees to indemnify, defend, and hold harmless the City, its
officers, employces, agents and representatives, from any and all claims, demands, purported
25D -22
liability, or consequential damages of any kind or nature arising out of or in connection with
REAC H's acts or omissions in carrying out the terms of this Agreement or exercishng the rights
herein granted; excepting those claims, demands, purported liability, or consequential damages
which arise out of the sole negligence of City.
REACH agrees to maintain during the course of this Agreement the following insurance
coverage:
a) Comprehensive general liability insurance coverage, including personal injury and
contractual liability coverage, in an amount equal to One Million Dollars
($ 1,000,000.00) per occurrence, combined single limit;
b) Worker's Compensation insurance as required by State of California statutes;
C) Professional liability insurance with a Onc Million Dollar ($1,000,000.00) limit, per
occurrence. REACH agrees to keep such policy in force and effect for at least five (5)
years from the date of completion of this Agreement.
Also, the City of Santa Ana, its officers, agents and employees will be named as additional
insured on the above referred comprehensive general liability coverage and REACH will
provide an endorsement to that effect. Such insurance shall (a) name the City, its officers,
employees, agents, volunteers and representatives as additional insured(s); (b) be primary
and not contributory with respect to insurance or self-insurance programs maintained by the
City; and (c) contain standard separation of insured's provisions. Such insurance will be
evidenced by certificate and issued by companies licensed to do business in California and
acceptable to the City. Before REACH performs any work, it will furnish certificates of
insurance and endorsements, as required by City, evidencing the aforementioned general
liability, and professional liability insurance coverages on forms acceptable to the City which
shall provide that the insurance in force not be canceled or modified without 30 days prior
written notice to the City,
8. NO ASSIGNMENT. REACH shall not assign or transfer this Agreement or any rights
hereunder without the prior written consent of the City and approval by the City's City Attomey,
which may be withheld in the City's solo discretion. Any unauthorized assigned or transfer shall be
null and void and shall constitute a material breach by REACH of its obligations under this
Agreement. No assigntxcnt shall release the original parties or otherwise constitute a notation.
9. COMPLIANCE WITH LAWS. REACH shall comply with all Federal, State, County and
City laws, ordinances, rules and regulations, which are, as amended from time to time, incorporated
heroin and applicable to the performance hereof.
10. ATTORNEY FEES. If any action at law or in equity is brought to enforce or interpret tine
terms of this Agreement, the prevailing party shall be entitled to reasonable attorney's tees, costs
and necessary disbursements in addition to the relief to which such party may be entitled,
11, INTERPRETATION,
2501-23
(a)- Aplj- cvgvv. This Agreement, and the rights and duties of the parties hereunder (both
procedural and substantive), shall be governed by and construed according to the laws of the
State of California, with venue in Orange County.
(b) Entire Agreement. This Agreement, including any exhibits attached hereto, constitutes
the entire agreement and understanding; between the parties regarding its subject matter and
supersedes all prior or contemporaneous negotiations, representations , understandings,
correspondence, documentation and agreements (written or oral). To the extent there is any
conflict or inconsistency between the terms and provisions of this Agreement and the
exhibits attached hereto, the terms and provisions of this Agreement shall govern the rights
and obligations the parties hereto.
(c) Writtcn Amendment, This Agreement may only be changed by written amendment
signed by REAC14 and the City Manager of the City or other authorized representative of
the City, subject to any requisite authorization by the City CounciL Any oral representations
or modifications concerning this Agreement shall be of no force or effect.
(d) y'jev_erabilit . If any provisions of this Agreement is held by any court of competent
jurisdiction to be invalid, illegal, void, or unenforceable, such portion shall be deemed
severed from this Agreement, and the remaining provisions shall nevertheless continue in
full force and effect as fully as though such invalid, illegal, or unenforceable portion had
never been pail of this Agreement.
(e) Order of Precedence. In case of conflict between the terms of this
Agreement and the terms contained in any document attached as an exhibit or otherwise
incorporated by reference, the terns of this Agreement shall strictly prevail.
(f) Choice of Forum, The parties hereby agree that this Agreement is to be executed in
accordance with the applicable taws of the State of California, is entered into and is to be
performed in the City of Santa Ana and that all claims or controversies arising out of or
related to performance under this Agreement shall be submitted to and resolved in a forum
within the City of Santa Ana at a place to be determined by the rules of the forum.
12. TIME OF ESSENCE. Time is strictly of the essence of this Agreement and each and every
covenant, term and provision hereof.
13. AU'HOR.ITY OF REACH. REACH hereby represents and warrants to the City that
REACH has the right, power, legal capacity and authority to enter into and perform its obligations
under this Agreement, and its execution of this Agreement has been duly authorized.
14. INSURANCE. REACH shall, at its own expense, proctuNe and maintain policies of insurance
of the types and in the amounts set forth in the Agreement to which this Addendum is attached for
the duration of the Agreement, including any extensions hereto. The policies shall state that they
afford primary coverage. Failure to maintain required insurance at all times shall constitute a default
and material breach. In such event, RPA.CH shall immediately notify City and cease all
25D -24
pc,rformance under this Agreement until further directed by the City. In the absence of satisfactory
insurance coverage, City may, at its option: (a) procure insurance with collection rights for
pre Auns, attorney's fees and costs against REACH by way of set-off or recoupment from the suns
due REACH, at City's option; (b) immediately terminate this Agreement; or (c) self insure the risk,
with all damages and costs incurred, by judgment, settlement or otherwise, including attorney's fees
and costs, being collectible from REACH, by way of set -off or recoupment from any sums due
REACH,
15, NOTICES. Any notice or demand to be given by one party to the other shall be given in
writing and by personal delivery or prepaid first - class, registered or certified mail, addressed as
follows. Notice simply to the City of Santa Ana or any other City department is not adequate notice,
To City: Clerk of the City Council
City of Santa Ana
20 Civic Center Plaza (M -30)
P.O. Box 1988
Santa Ana, CA 92702 -1988
hax 714 - 647 -6956
Copies to: Executive Director of the Personnel Services Agency
City of Santa Ana
20 Civic Center Plaza (M -24)
11.0. Box 1988
Santa Ana, California 92702
Fax 714- 647 -6930
City Attorney
City of Santa Ana
20 Civic Center Plaza (M -29)
P.O. Box 1988
Santa Ana, California 92702
Fax 714- 647 -6515
If to REAL ;I: REACH Employee Assistance, Inc.
101 East Lincoln Avenue, Suite 230
Anaheim, CA 92805
Attn.: Dr, Marcus Dayhoff
Any such notice shall be deemed to have been given upon delivery, if personally delivered, or, if
mailed, upon receipt or upon expiration of three (3) business clays from the date of posting,
whichever is earlier. Either party may change the address at which it desires to receive notice upon
giving written notice of such request to the other part)
16, T.FRNIINATION FOR CONVENIENCE (Without Cause). The City or REACH may
terminate this Agreement in whole or in part at any time, for airy cause or without cause, upon sixty
(60) calendar clays' written notice to the other. If the Agreement is thus terminated by the City for
9
25D -25
reasons other than REACH's failure to perform its obligations, the City shall pay Ri;ACH a
prorated amount based on the services satisfactorily completed and accepted prior to the effective
date of termination. Such payment shall be REACH's exclusive remedy for termination without
cause.
17. DEFAULT. In the event either party materially defaults in its obligations hereunder, the
other party may declare a default and terminate this Agreement by written notice to the defaulting
party. The notice shall specify the basis for the effective date of termination stated in such notice,
which date shall be no sooner than ter) (10) days after the slate of the notice.
Termination for cause shall relieve the terminating party of further liability or responsibility under
this Agreement, including the payment of money, except for payment of services satisfactorily and
timely performed prior to the service of the notice of termination, and except for reimbursement of
(1) any payments made by the City for service not subsequently performed in a timely and
satisfactory manner, and (2) costs incurred by the City in obtaining substitute performance.
18, EQUAL EMPLOYMENT OPPORTUNITY, During the performance of this Agreement,
REACH agrees as follows:
a. REACH shall not discriminate against any employee or applicant for employment because
of race, color, religion, sex, national origin or mental or physical disability.
REACH will ensure that applicants are employed and that employees are
treated during employment, without regard to race, color, religion, sex, national
origin or mental or physical disability. Such actions shall include, but not
limited to the following: employment, upgrading, demotion or transfer,
recruitment or recruitment advertising, layoff or termination, rates of pay or
other forms of compensation and selection training, including apprenticeship.
REACH agrees to post in conspicuous places, available to all employees and
applicants for employment, a notice setting forth provisions of this non-
discrimination clause.
b. REACH shall, in all solicitations and advertisements for employees
placed by, or on behalf of MAChI, state that ail qualified applicants will
receive consideration for employment without regard to race, color, religion,
sex, national origin, or mental or physical disability.
c. REACH shall cause the tbregoing paragraphs (a) and (b) to be inserted in all
subcontracts for any work covered by this Agreement, provided that the
foregoing provisions shall not apply to subcontracts for standard commercial
supplies or raw materials.
to
25D -26
19. CONFLICT. REACH hereby represents, warrant's and certifies that no member, officer or
employee of REACH is a director, officer or employee of the City, or a member of any of its
boards, commissions or comnlrittees, except to the extent permitted by law.
(Signahires on Following Page)
11
25D -27
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the elate and year fist
above written.
ATTEST:
rr
\Aaria I).1-lui�ar /
Clerk of the Council
APPROVER AS TO FORM:
SONIA R. CARVALIIO
City Attorney
Byj—�
Lisa. Storek
Assistant City Attorney
RE, COMMENDED FOR APPROVAL:
r
L,dWal'd Rays., I D irector
Personnel Services Agency
CITY OF SANTA ANA
David Cavazos
City Manager
REACH Employee Assistance, Inc.
Byj
Marcos I' ay110f1
CEO &, Clinical Director
1?
25D -28
ADMINISTRATIVE SERVICES AGREEMENT
Type: VantageCaxeRES
Account Number: 803237
25D -29
A -2ni l -258
Plan number 503237
ADMINISTRATIVE SERVICES AGREEMENT
This Agreement, made as of the 28 day of November 2011 (herein referred
to as the "Inception Date "), between The International City Management Association
Retirement Corporation ( "ICMA, -RC" ), a nonprofit corporation organized and existing
under the laws of the State of Delaware; and the City of Santa Ana ( "Employer ") a Local
governmental instrumentality organized and existing under the laws of the State of
California with an office at 20 Civic Center Plaza, Santa Ana 92701.
RECITALS
Employer acts as a public plan sponsor for a retiree health plan with responsibility to
obtain investment alternatives and services for employees participating in that plan;
Employer desires to make the VantageCare Retirement Health Savings Plan ( "RHS Plan"
or "Plan ") provided by ICMA -RC available to its employees;
ICMA -RC makes available the Vantagepoint Funds, a no -load, diversified mutual fund,
for investment of public employer plan assets, including RHS Plan assets;
ICMA -RC provides a complete offering of services to public employers for the operation
of employee retirement and retiree health savings plans including, but not limited to,
communications concerning investment alternatives, account maintenance, account
record - keeping, investment and tax reporting, form processing, benefit disbursement and
asset management.
AGREEMENTS
I. Acceutance of RHS Plan
Employer agrees to make the REIS Plan provided by ICMA-RC available to its
employees. The details of the RPIS Plan shall be as mutually agreed between the
Employer and ICMA -RC, and in general shall be as set forth in the Ri-1S Plan materials
developed by ICMA -RC and provided to Employer. The RHS Plan materials are hereby
incorporated by reference and made a part of this Agreement, except that Employer and
ICMA -RC may from time to time mutually agree in writing to terms that vary fi-om the
RHS Plan materials. RRS plan materials shall include the VantageCare RHSEinploy =er
Manual, available electronically through the EZ Link System upon plan adoption.
The functions to be performed by ICMA -RC and its agents include:
(a) allocation in accordance with participant direction of individual accounts to
investment hinds ( "Funds ") made available to Plan participants;
(b) maintenance of individual accounts for participants reflecting amounts
contributed,
25D -30
Ulan nuinber 803237
income, gain, or loss credited, and amounts disbursed as benefits;
(c) provision of periodic reports to the Employer and participants of the status of Plan
investments and individual accounts;
(d) communication to participants of information regarding their rights acrd elections
under the Plan;
(e) disbursement of benefits as agent for the Employer in accordance with terns of
the Plan; and
(f) performance of tax withholding and reporting in conjunction with the Employer
for each RI-IS account.
2. Employer Duty o Furnish Information
Employer agrees to furnish to ICMA -RC on a timely basis such information as is
necessary for ICMA -RC to carry out its responsibilities with respect to the Plan,
including information needed to allocate individual participant accounts to Funds, and
information as to the benefit eligibility and employment status of participants, and
participant ages, addresses, beneficiaries and other identifying information (including tax
identification numbers). ICMA -RC shall be entitled to rely upon the accuracy of any
information that is furnished to it by a responsible official of the Employer or any
information relating to an individual participant, dependent, or beneficiary that is
furnished by such participant, dependent, or beneficiary, and ICMA -RC shall not be
responsible for any error arising from its reliance on such information. ICMA -RC will
provide account information in reports, statements or accountings.
3. Certain Representations and Warranties
ICMA -RC represents and warrants to Employer that:
(a) ICMA -RC is a non - profit corporation with frill power and authority to enter into
this Agreement and to perform its obligations tinder this Agreement.
(b) ICMA -RC is in investment adviser registered as such with the Securities and
Exchange Commission under the Investment Advisees Act of 1940, as amended.
ICMA -RC Services, LLC (a wholly owned subsidiary of ICMA -RC) is registered
as a broker - dealer with the Securities and Exchange Commission (SEC) and is a
member in good standing of the National Association of Securities Dealers, Inc.
Employer represents and warrants to ICMA -RC that:
(c) Employer is organized in the form and manner recited in the opening paragraph of
this Agreement with full power and authority to enter into and perform its
obligations under this Agreement and to act for the Plan and participants in the
25D -31
Plan number 803237
manner contemplated in this Agreement, Execution, delivery, and performance of
this Agreement will not conflict with any law, rule, regulation or contract by
which the Employer is bound or to which it is a party.
(d) Information required to be retained by the Employer shall be set forth in the RHS
plan materials developed by ICMA -RC and provided to the Employer.
(e) Employer is responsible for determining that there are no state or local laws that
would prohibit it from establishing ICMA -RC's VantageCare RHS program,
Employer is also responsible for determining that the investments selected for the
RIIS plan fall within state/local requirements.
(1) Employer acknowledges that the RHS plan may be treated as a "health plan" for
Health Insurance Portability and Accountability Act ( "HIPAA ") purposes and
therefore may be subject to HIPAA privacy rules. If it is determined that the RHS
plan is considered a "health plan ", an employer sponsoring RHS would be
responsible for complying with the HIPAA privacy and security rules regarding
protected health information of RI-SS plan participants.
ICMA -RC has procedures in place to safeguard the protected health information
of RHS plan participants.
4. Paricipation in Certain Proceedings
The Employer hereby authorizes ICMA -RC to act as agent, to appear on its behalf, and to
join the Employer as a necessary party in all legal proceedings involving the garnislnncnt
of benefits or the transfer of benefits pursuant to a medical child support order, Unless
Employer notifies ICMA -RC otherwise, Employer authorizes ICMA -RC to determine
whother disbursement of benefits to a spouse or child pursuant to a medical child support
order is appropriate.
5. Compensation and Pa menC
(a) Absent an explicit agreement to the contrary between 1CMA -RC and Employer,
participant fees and expenses shall be payable from RHS assets, in accordance
with the requirements of the RI-IS Plan as set forth below.
Air annual asset fee of 0.40% (40 basis points) will be charged on a
quarterly basis, based on the balance in the account on the last day of the
previous quarter.
In addition to the annual asset Pee, a $25 annual account fee will be
charged quarterly to each Accountholder's account,
Account administration foes are subject to change with appropriate prier
notification,
25D -32
Plan number 803237
(b) Compensation for Advisory and other Services to the Vantagepoint Funds,
Employer acknowledges that certain wholly -owned subsidiaries of ICMA -RC
receive compensation from the Vantagepoint Funds for advisory and other
services 'furnished to the Vantagepoint Funds, The fees referred to in this
subsection are disclosed in the Vantagepoint Funds Prospectus and Statement of
Additional Information,
Employer acknowledges and agrees that ICMA -RC does not assume any
responsibility with respect to the selection or retention of the Plan's investment
options. Employer shall have exclusive responsibility for the Plan's investment
options, including the selection of the applicable mutual fund share class.
Qustodv
Employer understands that amounts contributed to the RHS plan are to be remitted
directly to Vantagepoint Transfer Agents in accordance with instructions provided to
Employer in the RHS plan materials and are not to be remitted to ICMA -RC. In the
event that any check or wire transfer is incorrectly labeled or transferred, ICMA -RC will
return it to Employer with proper instructions.
7, Responsibility
(a) ICMA -RC sbali not be responsible for any acts or omissions of any person other
than ICMA -RC in connection with the administration or operation of the Plan,
(b) The Employer understands that, as a general matter, the Internal Revenue Service
( "IRS ") may decline to nile on certain design features or provisions that the
Employer may request to have added to the RHS plan materials. The Employer
agrees to hold ICMA -RC harmless in connection with the addition and
administration of any RHS plan feature or provision requested by the Employer
for which the IRS will not provide express interpretive guidance..
S. Indernni catr2n
ICMA -RC shall not be responsible for any acts or omissions of any person with respect
to the Plan or related Trust, other than ICMMA-RC in connection with the administration
or operation of the Plan. Employer shall indemnify ICMA -RC against, and hold ICMA -
RC harmless frown, any and all loss, darnage, penalty, liability, cost, and expense,
including without limitation, reasonable attorney's fees, that may be incurred by, imposed
upon, or asserted against ICMA -RC by reason of any claim, regulatory proceeding, or
litigation arising front any act done or omitted to be done by any individual or person
with respect to the Plan or related Trust, excepting only any and all loss, damage, penalty,
liability, cost or expense resulting from ICMA -RC's negligence, bad faith, or willful
misconduct.
25D -33
Plan number 505237
9. 'Term
This Agreement shall be in effect For an initial term beginning on the Inception Date and
cutting; 5 years after the Inception .Date. This Agreement will be renewed automatically
for each succeeding year unless written notice of termination is provided by either party
to the otherno less than 60 days before the end of such Agreement year.
10. Amendments and Ad'ul stments
(a) This Agreement may not be amended except by written instrument signed by the
parties.
(b) The parties agree that an adjustment to compensation or administrative and
operational services under this Agreement may only be implemented by ICMA-
RC through a proposal to the Employer via correspondence or the Employer
Bulletin. The Employer will be given at least 60 days to review the proposal
before the effective date of the adjustment. Such adjustment shall become
effective unless, within the 60 day period before the effective date, the Employer
notifies ICMA -RC in writing that it does not accept such adjustment, in which
event the parties will negotiate with respect to the adjustment.
(c) No failure to exercise and no delay in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver of such right, remedy, power or
privilege,
11. Notices
All notices required to be delivered under Section 10 of this Agreement shall be delivered
personally or by registered or certified mail, postage prepaid, return receipt requested, to
(i) Legal Department, ICMA Retirement Corporation, 777 North Capitol Street, N.E,,
Suite 600, Washington, D,C, 20002 -4240; (ii) Employer at the office set forth in the first
paragraph hereof, or to any other address designated by the party to receive the same by
written notice similarly given.
12. Complete Agreement
This Agreement shall constitute the sole agreement between ICMA -RC and Employer
relating to the object of this Agreement and correctly sets fortb the complete rights, duties
and obligations of each patty to the other as of its date, Any prior agreements, promises,
negotiations or representations, verbal or otherwise, not expressly set forth in this
Agreement are of no force and effect.
13. Governing Law
This agreement shall be governed by and construed in accordance with the laws of the
State of California applicable to contracts made in that jurisdiction without reference to
25D -34
Plannumber 303237
its conflicts of laws provisions.
In Witness Whereof, the parties hereto have executed this Agreement as of the Inception
Date first above written.
CITY OF SANTA ANA
B _ ? Date !��w
Signature
Paul Walters, City Manager
Name and Title (Please Print)
1NTEPNI ATIONAL CITY /COUNTY MANAGEMENT
ASSOCIATION RETIREMENT CORPORATION
t2
By - --
Angela C. Montez
Assistant Corporate Secretary
APB�., (OV-BD A8 TO e()iJA
'- -•*7"- LIJA E. SiORCK
Assistant City Attorney
ATTEST.
MARIA D- HUIZAR
CLERK OF THE COUNCIL
25D -35
i
CITY COUNCIL, MEETING DATE:
NOVEMBER 28, 2011
TITLE:
AGREEMENT WITH ICMA -RC TO
ESTABLISH A RETIREE HEALTH
SAVINGS PLAN ACCESSIBLE TO
ALL BARGAINING GROUPS ON A
VOLUNTARY BASIS
CITY MANAGER
APPROVED
❑ As Recommended
As Amended
❑ Ordinance on 151 Reading
❑ Ordinance on 2nd Reading
❑ Implementing Resolution
❑ Set Public Flearing Far`_
CONTINUED TO
FILE NUMBER
1, Adopt a resolution authorizing the implementation of the "Vantage Care" Retirement Health
Savings Plan ( "RHS ") and designating ICMA -RC as the administrator of the RHS plan.
Bargaining units that elect to voluntarily participate in the RHS plan will transfer funds from
their current Medical Retirement Subsidy Plan to establish the trust required under the plan;
2. Authorize the City Manager and the Clerk of the Council to execute the attached agreement
with ICMA -RC to establish and administer the plan for a period of five years with provision
for year -to -year extensions, contingent upon Council *approval, and to execute any other
documents required to establish the trust and implement the plan for each bargaining unit
choosing to voluntarily participate;
3. Appoint the Executive Director of Finance & Management Services Agency, or his
designee, as the City's Plan Trustee authorized to maintain compliance with any regulations
regarding the trust.
4. Appoint the Executive Director of Personnel Services, or his designee, as the City's Plan
Administrator for the Plan, authorized to implement the plan, amend the plan, and to take
additional actions as necessary to maintain the City's participation in the plan, maintain
compliance with any regulations regarding the plan, and to administer the plan for current
and retired bargaining unit members, on behalf of the City.
DISCUSSION
Each bargaining unit (SEIU, FBA, FMA, POA, PMA, SAMA, EM, and CASA) has established a
Medical Retirement Subsidy Plan for its members for the purpose of partially subsidizing the cost
of retiree health insurance premiums. The plans (except for POA) are administered by the City, at
no cost to the bargaining unit or members. It has recently come to the City's attention that the
annual retiree health subsidy amounts deposited by the City are construed as a future unfunded
liability for the City.
Llrl!T�: "s'
i
ADMINISTRATIVE SERVICES AGREEMENT
Type: VantageCare RHS
Account Number: 803237
EXHIBIT 6
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A. -211 -258
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Plan cumber 803237
ADMINISTRATIVE SERVICES AGREEMENT"
This Agreement, made as of the 28 day of November 2011 (herein referred
to as the "Inception Date "), between Tltc lnternational City Management Association
Retirement Corporation ( "ICMA -RC "), a nonprofit corporation organized and existing
under the laws of the State of Delaware; and the City of Santa Ana ('Employer ") a local
governmental instrumentality organized and existing under the laws of the State of
California with an office at 20 Civic Center Plaza, Santa Ana 92701.
RECITALS
Employer acts as a public plan sponsor for a retiree health plan with responsibility to
obtain investment alternatives and services for employees participating in that plan;
Employer desires to make the VantageCare Retirement Health Savings Plan ( "RHS Plan"
or "Plan ") provided by ICMA -RC available to its employees;
ICMA -RC makes available the Vantagepofi t Funds, a no -load, diversified mutual fund,
for investment of public employer plan assets, including R14S Plan assets;
ICMA -RC provides a complete offering of services to public employers for the operation
of employee retirement and retiree health savings plans including, but not limited to,
communications concerning investment alternatives, account maintenance, account
record - keeping, investment and tax reporting, form processing, benefit disbursement and
asset management.
AGREEMENTS
1. Acceptance of RHS Plan
Employer agrees to make the RHS Plan provided by ICMA -RC available to its
employees. The details of the RI-IS Plan shall be as mutually agreed between the
Employer and ICMA -RC, and in general shall be as set forth in the RHS Plan materials
developed by ICMA -RC and provided to Employer. The RHS Plan materials are hereby
incorporated by reference and made a part of this Agreement, except that Employer and
ICMA -RC may from time to time mutually agree in writing to terms that vary from the
RHS Plan materials. RHS plan materials shall include the VaretageCare RHSErnployer
Manual, available electronically through the EZ Link System upon plan adoption.
The functions to be performed by ICMA -RC and its agents include:
(a) allocation in accordance with participant direction of individual accounts to
investment funds ('Funds ") made available to Plan participants;
(b) maintenance of individual accounts for participants reflecting amounts
contributed,
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flan number 803237
income, gain, or loss credited, and amounts disbursed as benefits;
(c) provision of periodic reports to the Employer and participants of the status ol''Plan
investments and individual accounts;
(d) communication to participants of information regarding their rights and elections
under the Plan;
(e) disbursement of benefits as agent for the Employer in accordance with terms of
the Plan; and
(f) performance of tax withholding and reporting in conjunction with the Employer
for each RHS account.
2. Employer Duty to Furnish Information
Employer agrees to furnish to ICMA -RC on a timely basis such information as is
necessary for ICMA -RC to carry out its responsibilities with respect to the Plan,
including information needed to allocate individual participant accounts to Funds, and
information as to the benefit eligibility and employment status of participants, and
participant ages, addresses, beneficiaries and other identifying information (including tax
identification numbers). ICMA -RC shall be entitled to rely upon the accuracy of any
information that is furnished to it by a responsible official of the Employer or any
information relating to an individual participant, dependent, or beneficiary that is
furbished by such participant, dependent, or beneficiary, and ICMA -RC shall not be
responsible for any error arising from its reliance on such information. ICMA -RC will
provide account information in reports, statements or accountings.
3. Certain Representations and Warranties
ICMA -RC represents and warrants to Employer that:
(a) ICMA -RC is a non- profit corporation with full power and authority to enter into
this Agreement and to perform its obligations under this Agreement.
(b) ICMA -RC is an investment adviser registered as such with the Securities and
)exchange Commission under the Investment Advisers Act of 1940, as amended.
ICIVIA -RC Services, LLC (a wholly owned subsidiary of ICMA -RC) is registered
as a broker - dealer with the Securities and Exchange Commission (SEC) and is a
member in good standing of the National Association of Securities Dealers, Inc.
Employer represents and warrants to ICMA -RC that:
(e) Employer is or'ganiz'ed in the firm and manner recited in the opening paragraph of
this Agreement with full power and authority to enter into and perform its
obligations under this Agreement and to act for the Plan and participants in the
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Plan number 803237
mariner contemplated in this Agreement. Execution, delivery, and performance of
this Agreement will not conflict with any law, rule, regulation or contract by
which the Employer is bound or to which it is a party.
(d) Information required to be retained by the Employer shall be set forth in the RHS
plan materials developed by ICMA -RC and provided to the Employer.
(e) Employer is responsible for determining that there are no state or local laws that
would prohibit it from establishing ICMA -RC's VantageCare RHS program.
Employer is also responsible for determining that the investments selected for the
RIIS plan fall within state /local requirements.
(f) Employer acknowledges that the RHS plan may be treated as a "health plan" for
Health Insurance Portability and Accountability Act ( "HIPAA ") purposes and
therefore may be subject to HIPAA privacy rules. If it is detemnined that the RIIS
plan is considered a `health plan ", an employer sponsoring RHS would be
responsible for complying with the HIPAA privacy and security rules regarding
protected health information of RHS plan participants.
ICMA -RC has procedures in place to safeguard the protected health information
of RIIS plan participants.
4. Participation in Certain Proceedings
The Employer hereby authorizes ICMA -RC to act as agent, to appear on its behalf, and to
join the Employer as a necessary party in all legal proceedings involving the garnishment
of benefits or the transfer of benefits pursuant to a medical child support order. Unless
Employer notifies ICMA -RC otherwise, Employer authorizes ICMA -RC to determine
whether disbursement of benefits to a spouse or child pursuant to a medical child support
order is appropriate.
5. Compensation and Paviliont
(a) Absent an explicit agreement to the contrary between ICMA -RC and Employer,
participant fees and expenses shall be payable from RHS assets, in accordance
with the requirements of the RIIS Plan as set forth below.
An annual asset fee of 0.40% (40 basis points) will be charged on a
quarterly basis, based on the balance in the account on the last clay of the
previous quarter.
In addition to the annual asset fee, a $25 annual account fee will be
charged quarterly to each Accountholder's account.
Account administration fees are subject to change with appropriate prior
notification.
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Plan number 803237
(b) Compensation for Advisory and other Services to the Vantagepoint Funds,
Employer acknowledges that certain wholly -owned subsidiaries of ICMA -RC
receive compensation from the Vantagepoint Funds for advisory and other
services furnished to the Vantagepoint Funds. The fees referred to in this
subsection are disclosed in the Vantagepoint Funds Prospectus and Statement of
Additional Information.
Employer acknowledges and agrees that ICMA -RC does not assume any
responsibility with respect to the selection or retention of the Plan's investment
options. Employer shall have exclusive responsibility for the Plan's investment
options, including the selection of the applicable mutual find share class.
6. Custody
Employer understands that amounts contributed to the RHS plan are to be remitted
directly to Vantagepoint Transfer Agents in accordance with instructions provided to
Employer in the RHS plan materials and are not to be remitted to ICMA -RC. In the
event that any check or wire transfer is incorrectly labeled or transferred, ICMA -RC will
return it to Employer with proper instructions.
7. Responsibility
(a) ICMA -RC shall not be responsible for any acts or omissions of any person other
than ICMA -RC in connection with the administration or operation of the Plan.
(b) The Employer understands that, as a general matter, the Internal Revenue Service
( "IRS ") may decline to rule on certain design features or provisions that the
Employer may request to have added to the RHS plan materials. The Employer
agrees to hold ICMA -RC harmless in connection with the addition and
administration of any RHS plan feature or provision requested by the Employer
for which the IRS will not provide express interpretive guidance.
S. Indemnification
ICMA -RC shall not be responsible for any acts or omissions of any person with respect
to the Plan or related Trust, other than ICMA -RC in connection with the administration
or operation of the Plan. Employer shall indemnify ICMA -RC against, and hold ICMA -
RC harmless from, any and all loss, damage, penalty, liability, cost, and expense,
including without limitation, reasonable attorney's fees, that may be incurred by, imposed
upon, or asserted against ICMA -RC by reason of any claim, regulatory proceeding, or
litigation arising from any act done or omitted to be done by any individual or person
with respect to the Plat or related Trust, excepting only any and all loss, damage, penalty,
liability, cost or expense resulting from ICMA -RC's negligence, bad faith, or willful
misconduct,
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Plan number 803237
9. "Perm
This Agreement shall be in effect for an initial term beginning on the Inception Date and
ending 5 years after the Inception Date. This Agreement will be renewed automatically
for each succeeding year unless written notice of termination is provided by either party
to the other no less than 60 clays before the end of such Agreement year.
10. Amendments and Adiustments
(a) This Agreement may not be amended except by written instrument signed by the
parties.
(b) The parties agree that an adjustment to compensation or achninistrative and
operational services under this Agreement may only be implemented by ICMA-
RC through a proposal to the Employer via correspondence or the Employer
Bulletin. The Employer will be given at least 60 days to review the proposal
before the effective date of the adjustment. Such adjustment shall become
effective unless, within the 60 clay period before the effective date, the Employer
notifies ICMA -RC in writing that it does not accept such adjustment, in which
event the parties will negotiate with respect to the adjustment.
(c) No failure to exercise and no delay in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver of such right, remedy, power or
privilege.
11. Notices
All notices required to be delivered under Section 10 of this Agreement shall be delivered
personally or by registered or certified mail, postage prepaid, return receipt requested, to
(i) Legal Department, 1CMA Retirement Corporation, 777 North Capitol Street, N.E.,
Suite 600, Washington, D.C, 20002 -4240; (ii) Employer at the office set forth in the first
paragraph hereof, or to any other address designated by the party to receive the same by
written notice similarly given.
12. Com lep to Agreement
This Agreement shall constitute the sole agreement between ICMA -RC and Employer
relating to the object of this Agreement and correctly sets forth the complete rights, duties
and obligations of each party to the other as of its date. Any prior agreements, promises,
negotiations or representations , verbal or otherwise, not expressly set forth in this
Agreement are of no force and effect.
13. Governing Law
This agreement shall be governed by and construed in accordance with the laws of the
State of California applicable to contracts made in that jurisdiction without reference to
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Plan number 803237
its conflicts of laws provisions.
In Witness Whereof, the parties hereto have executed this Agreement as of the Inception
Date first above written.
CITY OF SANTA ANA
B(_ Date Zi�w_
Signature
Paul halters, City Manager
Name and Title (Please Print)
INTERNATIONAL CITY /COUNTY MANAGEMENT
ASSOCIATION RETIREMENT CORPORATION
By
Angela C. Montez
Assistant Corporate Secretary
APPROVV'EDA M
S TO FOR
( •r
'° 'LISA E, STORCK
Assistant City Attorney
arTEST,
MARIA D. HUIZAR u
CLERK OF THE COUNCIL
2501-49
25D -50
REQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
NOVEMBER 28, 2011
TITLE:
AGREEMENT WITH ICMA -RC TO
ESTABLISH A RETIREE HEALTH
SAVINGS PLAN ACCESSIBLE TO
ALL BARGAINING GROUPS ON A
VOLUNTARY BASIS
1
4
CITY MANAGER
RECOMMENDED ACTION
F-4 91921
❑ As Recommended
❑ As Amended
❑ Ordinance on 18, Reading
❑ Ordinance on 2 "tl Reading
❑ Implementing Resolution
❑ Set Public Hearing For__
CONTINUED TO
FILE NUMBER
1. Adopt a resolution authorizing the implementation of the "Vantage Care" Retirement Health
Savings Plan ( "RHS ") and designating ICMA -RC as the administrator of the RHS plan.
Bargaining units that elect to voluntarily participate in the RHS plan will transfer funds from
their current Medical Retirement Subsidy Plan to establish the trust required under the plan;
2. Authorize the City Manager and the Clerk of the Council to execute the attached agreement
with ICMA -RC to establish and administer the plan for a period of five years with provision
for year -to -year extensions, contingent upon Council 'approval, and to execute any other
documents required to establish the trust and implement the plan for each bargaining unit
choosing to voluntarily participate;
3. Appoint the Executive Director of Finance & Management Services Agency, or his
designee, as the City's Plan Trustee authorized to maintain compliance with any regulations
regarding the trust.
4. Appoint the Executive Director of Personnel Services, or his designee, as the City's Plan
Administrator for the Plan, authorized to implement the plan, amend the plan, and to take
additional actions as necessary to maintain the City's participation in the plan, maintain
compliance with any regulations regarding the plan, and to administer the plan for current
and retired bargaining unit members, on behalf of the City.
DISCUSSION
Each bargaining unit (SEIU, FBA, FMA, POA, PMA, SAMA, EM, and CASA) has established a
Medical Retirement Subsidy Plan for its members for the purpose of partially subsidizing the cost
of retiree health Insurance premiums. The plans (except for POA) are administered by the City, at
no cost to the bargaining unit or members. It has recently come to the City's attention that the
annual retiree health subsidy amounts deposited by the City are construed as a future unfunded
liability for the City.
55°11
25D -52
ICMA -RC Retiree Health Savings Plan
November 28, 2011
Page 2
In the Memorandum of Understanding between the City and The Santa Ana Police Management
Association ( "PMA ") for fiscal year 2004 - 2008, the City agreed to establish a voluntary program
for employees to contribute unused sick leave, vacation, or other employee benefits on a pre -tax
basis. Since that time, the City and PMA have explored various alternatives to address this issue
and determined that converting the subsidy plan to a retiree health savings plan would benefit both
the City by eliminating the unfunded liability associated with retiree medical plans pursuant to
Governmental Accounting Standards Board (GASB) reporting requirements for "Other Post
Employment Benefits" (OPEB) and benefit the PMA members.
The PMA has requested the City proceed with implementation steps required to adopt the ICMA -
RC "Vantage Care" retiree health savings plan. All other bargaining groups are aware of this plan
and the City would make this plan accessible to all bargaining units on a voluntary basis. Under
this plan, bargaining unit members are allowed to accumulate assets to pay for health insurance
and out -of- pocket medical expenses at retirement. An bargaining unit member may contribute
unused sick leave, vacation, and other benefits to an account, which is tax -free at deposit and tax
free at withdrawal when used to pay for medical expenses. Additionally, the existing medical
retirement subsidy funds for participating bargaining units will be deposited into the trust and
distributed equitably to current and retired bargaining unit members. Each bargaining unit will
determine how the existing funds will be split among their membership. Any future negotiated City
contributions for participating bargaining units will be deposited into the trust.
The plan will be administered by ICMA -RC at no cost to the City.
Therefore, the City proposes the creation of a trust to be administered by ICMA -RC, a 39- year -old
company that provides retirement savings plans, products and services to over 8,700 public sector
agencies with more than 900,000 participants. ICMA -RC will assess to participant accounts an
annual account fee of $25 ($6.25 1quarter) and an Asset fee of 40 basis points (0,40% of the
account) quarterly. Reimbursement requests will be handled directly by a third -party administrator
and no longer handled by the City of Santa Ana.
FISCAL IMEACT
There is no fiscal impact associated with this item
1�4: a
Executive Director
Personnel Services Agency
55 -
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