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HomeMy WebLinkAbout054879-A3 - General - Contract - Sedgwick Claims Management Services, Inc.CSC No. 54879-A3 AMENDMENT NO. 3 TO CITY OF FORT WORTH CONTRACT 54879 This Amendment is entered into by and between the City of Fort Worth (hereafter "City"), and Sedgwick Management Claims, Inc. ("Vendor"). City and Vendor may be referred to individually as a Party and collectively as the Parties. WHEREAS, on November 19, 2020, the Parties entered into City Secretary Contract 54879 for Vendor to provide workers' compensation administration and related services ("Agreement"); WHEREAS, the Parties wish to amend the Agreement to increase the total compensation amount allowed under the Agreement by $125,000.00 for a new total amount up to Nine Hundred Sixty -Six Thousand Eight Hundred Ninety -Nine Dollars ($966,899.00) as authorized by Mayor and Council Communication No. 20-0648 (09/15/2020). WHEREAS, the Parties wish to renew the Agreement for it Second Renewal Term, beginning November 20, 2026 to November 19, 2027. NOW, THEREFORE, the Parties, acting herein by and through their duly authorized representatives, enter into the following agreement: 1. AMENDMENTS Section 3, the Compensation provision of the Agreement, shall be deleted in its entirety and amended to read as follows: City shall pay Vendor in accordance with the fee schedule. Total payment made under this Agreement shall not exceed Nine Hundred Sixty -Six Thousand Eight Hundred Ninety -Nine Dollars ($966,899.00). Vendor shall not provide any additional items or services or bill for expenses incurred for City not specified by this Agreement unless City requests and approves in writing the additional costs for such services. City shall not be liable for any additional expenses of Vendor not specified by this Agreement unless City first approves such expenses in writing. 3.1 Suppliers are required to submit all invoices electronically to supplierinvoices(a,fortworthtexas.gov. Each invoice must include the purchase order number (if applicable), a detailed description of services or goods provided, and a total amount due. Invoices should be submitted in PDF format, clearly legible, and include vendor contact information. Incomplete or non -compliant invoices may be returned for correction and may delay processing and payment. 2. ALL OTHER TERMS SHALL REMAIN THE SAME All other provisions of the Agreement which are not expressly amended herein shall OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX 40818 remain in full force and effect. 3. ELECTRONIC SIGNATURE This Amendment may be executed in multiple counterparts, each of which shall be an original and all of which shall constitute one and the same instrument. A facsimile copy or computer image, such as a PDF or tiff image, or a signature, shall be treated as and shall have the same effect as an original. Signature Page Follows CITY OF FORT WORTH: CONTRACT COMPLIANCE MANAGER: anna Giordano (Oct 6, 202' ame: Dianna Giordano [tie: Assistant City Manager Date: 10/06/2026 AL RECOMMENDED: /12.lrL 5i By signing, I acknowledge that I am the person responsible for the monitoring and administration of this contract, including ensuring all performance and reporting requirements. ame: Danielle Caster itle: Human Resources Manager APPROVED AS TO FORM AND LEGALITY: ame: Kristen Smith By: itle: Human Resources Director Name: Jordan P. Alvarez TTEST: Title: Assistant City Attorney gFOHTgaC pti�Q.e.. kG9�j° .,, CONTRACT AUTHORIZATION: M&C: 20-0648 y: Form 1295: —N/A ame: Jannette Goodall Sedgwick claims Managmenet Services, Inc.. Peel E d Digitally signed by Peel, Ed Date: 2026.08.13 10:35:42 By: -0500' Name: J. Edward Peel Title: Vice President August 13 Date: , 2026 OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX M&C Review Page 1 of 3 CITY COUNCIL AGENDA Create New From This M&C DATE: 9/15/2020 REFERENCE **M&C 20- LOG NAME: NO.: 0648 CODE: P TYPE: CONSENT PUBLIC HEARING: Official site of the City of Fort Worth, Texas FORT TI1 13P 20-0148 WORKERS' COMPENSATION ADMINISTRATION HRD JPB NO SUBJECT: (ALL) Authorize Execution of an Agreement with Sedgwick Claims Management Services, Inc. for Workers' Compensation Administration and Related Services for a Flat Fee Up to $725,967.00 for the First Year and about a 2.5% Increase in the Subsequent Years (Year 2 - $744,116.00, Year 3 - $762,719.00, Year 4 - $781,878.00, and Year 5 - $801,332.00), for a Five -Year Initial Term with Option to Renew Up to Two Additional One -Year Terms at the City's Sole Discretion RECOMMENDATION: It is recommended that the City Council authorize the execution of an agreement with Sedgwick Claims Management Services, Inc. for workers' compensation administration and related services for a flat fee up to $725,967.00 for the first year and about a 2.5\% increase in the subsequent years (year 2 - $744,116.00, year 3- $762,719.00, year4- - $781,878.00, and year 5 - $801,332.00), for a five-year initial term with option to renew up to two additional one-year terms at the City's sole discretion, and authorize claims and associated costs to be paid for estimated claims expenses in the initial one-year period up to $9,400,000.00 and an estimated 5 percent increase in future years (year 2 - $9,870,000.00, year 3 - $10,380,000.00, year 4 - $10,890,000.00, and year 5 - $11,430,000.00). DISCUSSION: The Human Resources Department (HRD) approached the Purchasing Division to secure an agreement for workers' compensation administration and related services. The services includes: (1) third party claims administration services for a self -funded workers' compensation program to include claims adjusting, claims investigations, claims payments, establishing reserves, and claims management reports; (2) medical case management to include field and telephonic case management and vocational case management; (3) medical cost containment to include field and telephonic case management, early intervention, medical bill auditing, preauthorization and reconsideration determinations, utilization review, and durable medical equipment management; (4) pharmacy benefits management to include developing and maintaining a drug formulary, contracting with pharmacies, negotiating discounts and rebates with drug manufacturers, processing and paying prescription drug claims, and working with the City and the vendor to maintain or reduce pharmacy expenditures and improving health care outcomes of City employees; (5) 504 medical provider program — administration of the City's "BlackStone Provider Panel" to include provider credentialing, website maintenance, and maintenance of claimant and healthcare provider policies and procedures; (6) related services, such as Department of Workers' Compensation Austin Representatives, actuarial services, claims auditing, private investigations, legal representation at hearings; and (7) other such services. The York Risk Services Group, Inc. has been providing these services since November 1, 2015 under its previous Agreement (City Secretary Contract (CSC) No. 47186; Mayor and Council communication (M&C) C-27435) with the City. This agreement will expire on October 31, 2020. Staff issued a Request for Proposals (RFP) that consisted of detailed scope of services. The RFP was advertised in the Fort Worth Star -Telegram every Wednesday from May 13, 2020 through June 24, 2020. Seventeen vendors were solicited from the purchasing database; eleven responses were received. http ://apps .cfwnet. org/council_packet/mc_review. asp?ID=2 8217&councildate=9/ 15/2020 12/10/2025 M&C Review Page 2 of 3 An evaluation team consisting of staff from the HRD, the Police Department, the Fire Department, the Law Department and the Diversity and Inclusions Department evaluated proposals received. The evaluation team ranked the proposals based on pre -defined factors. Three finalists were selected for presentations. Following the presentations, the evaluation team determined Sedgwick Claims Management Services, Inc. provides the best overall services and recommended that the City Council authorize the execution of agreement for an initial five-year term with options to renew up to two additional one-year terms at the City's sole discretion. The flat fee for the initial one-year period is up to $725,967.00 and anticipated to trend at about a 2.5 percent increase in subsequent years (year 2 - $744,116.00, year 3 - $762,719.00, year 4 - $781,878.00, year 5 - $801,332.00, year 6 - $821,365.00, and year 7 - $841,899.00). In addition, claims and associated cost will be budgeted for in the respective fiscal years and paid. The estimated claims expenses for the initial one-year period is up to $9,400,000.00 and anticipated to trend at about a 5 percent increase in future years (year 2 - $9,870,000.00, year 3 - $10,380,000.00, year 4 - $10,890,000.00, year 5 - $11,430,000.00, year 6 - $12,000,000.00, and year 7 - $12,600,000.00). An administrative change order or increase may be made by the City Manager up to the amount allowed by relevant law and the Fort Worth City Code and does not require specific City Council approval as long as sufficient funds have been appropriated. Sedgwick Claims Management Services, Inc. is in compliance with the City's BDE Ordinance by committing to 10 percent MBE -AA (Minority Business Enterprises - African American) participation on this project. The City's goal on this project is 10 percent MBE -AA. Upon City Council approval, the five-year term of this contracts shall begin on November 1, 2020 and expire on October 31, 2025. The contract may be renewed for up to two successive one-year term at the City's option. This action does not require specific City Council approval, provided that the City has appropriated sufficient funds to satisfy the City's obligations during the renewal term. The contract will include a standard fiscal funding out clause that would comply with state law requirements by allowing the City to terminate the Agreement without penalty, if in the future, the Council elects not to appropriate funds for contracted services. FISCAL INFORMATION/CERTIFICATION: The Director of Finance certifies that upon approval of the above recommendations funds are available upon adoption of the Fiscal Year 2021 Budget by the City Council, funds will be available in the Fiscal Year 2021 Operating Budget, as appropriated, in the Risk Financing Fund. Prior to an expenditure being incurred, the Human Resources Department has the responsibility to validate the availability of funds. BQN\\ Fund Department Account Project Program Activity Budget Reference # ID ID I Year (Chartfield 2) Fund Department Account Project Program Activity Budget Reference # ID ID Year (Chartfield 2' Submitted for City Manager's Office by: Originating Department Head: Additional Information Contact: Jay Chapa (5804) Reginald Zeno (8517) Cynthia Garcia (8525) John Padinjaravila Baby (2279) Amount Amount http://apps.cfwnet.org/council_packet/mc_review.asp?ID=28217&councildate=9/15/2020 12/10/2025 M&C Review Page 3 of 3 ATTACHMENTS 1295 signed Sedwick.pdf (CFW Internal) 20-0148 Workers Comp FID.XLSX (CFW Internal) 200825 20-0148 Sedgwick Comp Memo rev.pdf (CFW Internal) SAMs Report 8-21-2020 Sedwick.pdf (CFW Internal) http ://apps .cfwnet. org/council_packet/mc_review. asp?ID=2 8217&councildate=9/ 15/2020 12/10/2025 FORTWORTH® City Secretary's Office Contract Routing & Transmittal Slip Contractor's Name: Sedgwick Claims Management Subject of the Agreement: NA NA NA Workers' comp Admin fees and RMIS Fees M&C Approved by the Council? * Yes 8 No ❑ If so, the M&C must be attached to the contract. Is this an Amendment to an Existing contract? Yes O No 8 NA If so, provide the original contract number and the amendment number. Is the Contract "Permanent"? *Yes ❑ No 8 If unsure, see back page for permanent contract listing. Is this entire contract Confidential? *Yes ❑ No 8 If only specific information is Confidential, please list what information is Confidential and the page it is located. NA NA Effective Date: 11/20/2026 Expiration Date: 11/19/2027 If dferent from the approval date. If applicable. Is a 1295 Form required? * Yes ❑ No *If so, please ensure it is attached to the approving M&C or attached to the contract. Project Number: If applicable. NA *Did you include a Text field on the contract to add the City Secretary Contract (CSC) number? Yes 8 No ❑ Contracts need to be routed for CSO processing in the following oder:: 1. Katherine Cenicola (Approver) 2. Jannette S. Goodall (Signer) 3. Allison Tidwell (Form Filler) *Indicates the information is required and if the information is not provided, the contract will be returned to the department.