City of Vallejo REQUEST FOR PROPOSAL WORKERS COMPENSATION CLAIMS AUDIT

City of Vallejo REQUEST FOR PROPOSAL WORKERS COMPENSATION CLAIMS AUDIT Date original issued: September 28, 2015 Qualifications Statements due: The City of Vallejo will consider Proposals submitted in response to this RFQ beginning on September 28, 2015 and ending October 23, 2015. P a g e 1

REQUEST FOR PROPOSAL WORKERS COMPENSATION CLAIMS AUDIT TABLE OF CONTENTS Part I - GENERAL INFORMATION FOR PROPOSERS Page 3 Part II - INFORMATION REQUIRED FROM PROPOSERS Page 8 Part III - CRITERIA FOR SELECTION Page 9 P a g e 2

PART I GENERAL INFORMATION FOR PROPOSERS I-1. Purpose. This request for proposals (RFP) provides interested Proposers with sufficient information to enable them to prepare and submit proposals for consideration by the City of Vallejo to satisfy a need for the completion of a comprehensive audit of the workers compensation function. The main objectives of this RFP are as follows: a. To audit and evaluate the current City processes for workers compensation claims b. To audit and evaluate the current third party adjuster s (TPA) processes in handling the City s workers compensation claims c. To make recommendation for improvements on current City processes and TPA processes keeping the following goals in mind: a. Cost effective and fair resolution of claims b. Best practices in the field c. Diligent defense of claims when appropriate d. Judicious and prudent economic decisions e. Optimal staffing I-2. Issuing Office. This RFP is issued for the City by the City Attorney s Office in conjunction with the Human Resources Department. I-3. Scope. This RFP contains instructions governing the proposals to be submitted and the material to be included therein; a description of the service to be provided; requirements which must be met to be eligible for consideration; general evaluation criteria; and other requirements to be met by each proposal. I-4. Timing. The City requests performance of a comprehensive audit of its workers compensation program, such audit to be completed and a final report presented to the issuing office within 60 days of full execution of the contract. I-5. Type of Contract. It is proposed that if a contract is entered into as a result of this RFP, it will be a fee for services contract. The City may in its sole discretion undertake negotiations with Proposers whose experience and proposals, including price and other factors, show them to be qualified, responsible, and capable of performing the work. I-6. Rejection of Proposals. The City reserves the right to reject any and all proposals received as a result of this request, or to negotiate separately with competing Proposers. I-7. Subcontracting. Any use of subcontractors by a Proposer must be identified in the proposal. During the contract period use of any subcontractors by the selected Proposer, which were not previously identified in the proposal, must be approved in advance in writing by the City. A firm that responds to this solicitation as a prime may not be included as a designated subcontractor to another firm that responds to the same solicitation. Multiple responses under any of the foregoing situations may cause the rejection of all responses of the P a g e 3

firm or firms involved. This does not preclude a firm from being set forth as a designated subcontractor to more than one prime contractor responding to the project advertisement. I-8. Incurring Costs. The City is not liable for any costs the Proposer incurs in preparation and submission of its proposal, in participating in the RFP process or in anticipation of award of contract. I.9. Questions and Answers. Written questions may be submitted to clarify any points in the RFP which may not have been clearly understood. Written questions should be submitted by email to Erika.Leahy@cityofvallejo.net with Workers Compensation Audit Clarification Requested in the Subject Line to be received no later than 12:00 PM Pacific Standard Time October 15, 2015. All questions and written answers will be posted to the website as an addendum to and become part of this RFP. I-10. Addenda to the RFP. If it becomes necessary to revise any part of this RFP before the proposal response date, addenda will be posted to the City s website under the original RFP document. If questions are asked by Proposers, questions and answers also will be posted. It is the responsibility of the Proposer to periodically check the website for any new information or addenda to the RFP. The City may revise a published advertisement. If the City revises a published advertisement less than ten days before the RFP due date, the due date will be extended to maintain the minimum ten-day advertisement duration if the revision alters the project scope or selection criteria. Firms are responsible to monitor advertisements/addenda to ensure the submitted proposal complies with any changes in the published advertisement. I-11. Response. To be considered, proposals must be delivered by 5:00PM on October 23, 2015 to Erika Leahy Risk Analyst City Attorney s Office 555 Santa Clara St. Third Floor Vallejo, CA, 94589 Please note that use of U.S. Mail, FedEx, UPS, or other delivery method, does not guarantee delivery for submission. Proposers mailing proposals should allow sufficient delivery time to ensure timely receipt of their proposals. If the City office location to which proposals are to be delivered is closed on the proposal response date, due to inclement weather, natural disaster, or any other cause, the deadline for submission shall be automatically extended until the next City business day on which the office is open. Unless the Proposers are otherwise notified by the City, the time for submission of proposals shall remain the same. I-12. Proposals. To be considered, Proposers should submit a complete response to this RFP, using the format provided in PART II. Each proposal should be submitted in five (5) hard copies of the Technical Submittal and five (5) hard copies of the Cost Submittal. In addition to the hard copies of the proposal, one complete and exact copy of the entire P a g e 4

proposal (Technical and Cost, along with all requested documents) on a Flash Drive in Microsoft Office or Microsoft Office-compatible format. Proposer should ensure that there is no costing information in the technical submittal. An official authorized to bind the Proposer to its provisions must sign the proposal. If the official signs the Proposal Cover Sheet (Appendix A to this RFP) and the Proposal Cover Sheet is attached to the proposal, the requirement will be met. For this RFP, the proposal must remain valid for at least 120 days. Moreover, the contents of the proposal of the selected Proposer will become contractual obligations if a contract is entered into. I-13. Economy of Preparation. Proposals should be prepared simply and economically, providing a straightforward, concise description of the Proposer s ability to meet the requirements of the RFP. I-14. Discussions for Clarification. Proposers who submit proposals may be required to make an oral presentation or written clarification of their proposals to the Issuing Office to ensure thorough mutual understanding and Proposer responsiveness to the solicitation requirements. The Issuing Office will initiate requests for clarification if necessary. I-15. Best and Final Offers. The Issuing Office reserves the right to conduct discussions with Proposers for the purpose of obtaining best and final offers. To obtain best and final offers from Proposers, the Issuing Office may do one or more of the following: a) enter into pre-selection negotiations; b) schedule oral presentations; and c) request revised proposals. The Issuing Office will limit any discussions to responsible Proposers whose proposals the Issuing Office has determined to be reasonably susceptible of being selected for award. I-16. Prime Proposer Responsibilities. The selected Proposer will be required to assume responsibility for all services offered in its proposal whether or not it produces them. Further, the City will consider the selected Proposer to be the sole point of contact with regard to contractual matters. I-17. Proposal Contents. Proposals will be held in confidence and will not be revealed or discussed with competitors, unless disclosure is required to be made (i) under the provisions of any State or Federal statute or regulation; or (ii) by rule or order of any court of competent jurisdiction. All material submitted with the proposal becomes the property of the City of Vallejo. Proposals submitted to the City may be reviewed and evaluated by any person other than competing Proposers at the discretion of the City. The City has the right to use any or all ideas presented in any proposal. Selection or rejection of the proposal does not affect this right. Proposers shall identify any and all portions of their Proposal that contains confidential proprietary information or is protected by a trade secret. Proposals shall include a written statement signed by a representative of the company/firm identifying the specific portion(s) of the Proposal that contains the trade secret or confidential proprietary information. I-18. Notification of non-selection. Proposers whose proposals are not selected will be notified promptly of their non-selection and given the name of the selected Proposer. P a g e 5

I-20. City Participation. Unless specifically noted in this section, Proposers must provide all services to complete the identified work. To the extent City documents are reviewed, City staff will participate cooperatively to facilitate such review. I-21. Cost Submittal. The cost submittal shall be placed in a separately sealed envelope within the sealed proposal and kept separate from the technical submittal. Failure to meet this requirement may result in disqualification of the proposal. I-22. Term of Contract. The City intends that the term of the contract will commence on the Effective Date (as defined below) and will remain in effect until completed. City would expect completion within six months. The City shall fix the Effective Date after the contract has been fully executed by the Contractor and by the City and all approvals required by City contracting procedures have been obtained. I-23. Proposer s Representations and Authorizations. Each Proposer by submitting its proposal understands, represents, and acknowledges that: a. All information provided by, and representations made by, the Proposer in the proposal are material and important and will be relied upon by the City in awarding the contract(s). b. The price(s) and amount of this proposal have been arrived at independently and without consultation, communication or agreement with any other Proposer or potential Proposer. c. Neither the price(s) nor the amount of the proposal, and neither the approximate price(s) nor the approximate amount of this proposal, have been disclosed to any other firm or person who is a Proposer or potential Proposer, and they will not be disclosed on or before the proposal submission deadline specified in the response section of this RFP. d. No attempt has been made or will be made to induce any firm or person to refrain from submitting a proposal on this contract, or to submit a proposal higher than this proposal, or to submit any intentionally high or noncompetitive proposal or other form of complementary proposal. e. The proposal is made in good faith and not pursuant to any agreement or discussion with, or inducement from, any firm or person to submit a complementary or other noncompetitive proposal. f. To the best knowledge of the person signing the proposal for the Proposer, the Proposer, its affiliates, subsidiaries, officers, directors, and employees are not currently under investigation by any governmental agency and have not in the last four (4) years been convicted or found liable for any act prohibited by State or Federal law in any jurisdiction, involving conspiracy or collusion with respect to bidding or proposing on any public contract, except as disclosed by the Proposer in its proposal. P a g e 6

g. To the best of the knowledge of the person signing the proposal for the Proposer and except as otherwise disclosed by the Proposer in its proposal, the Proposer has no outstanding, delinquent obligations to city of Vallejo, the State of California or the U.S. Government including, but not limited to, any state tax liability. h. The Proposer is not currently under suspension or debarment by any regulatory agency, the State of California, or any other state, or the federal government. P a g e 7

Part II. Professional Services Agreement A. Form of Agreement The services sought in this RFP shall not commence until the Proposer has been selected by the City, and parties have executed a Professional Services Agreement. The successful Proposer will be expected to sign the Professional Services Agreement in substantially the form as provided in Attachment A to this RFP. B. General Insurance Requirements Proposers shall take out and maintain during the entire term of the agreement, insurance pertaining to the activities associated with the agreement. Proposers will be required to obtain, at its own cost and expense, all insurance endorsements required below and shall provide evidence of such insurance and endorsements to the CITY prior to commencing work. Workers Compensation Employers Liability Comprehensive General Liability & Property Damage Professional Liability $5,000,000 per occurrence $1,000,000 per occurrence $1,000,000 CSL per occurrence $1,000,000 per occurrence P a g e 8

Part III. Scope of Work In addition to meeting the Audit s objectives as set forth in Part I of this RFP, the resulting work product should include the following components: 1. A determination and comparison of the cost of the city s workers compensation program in relation to comparable cities, including a City of Vallejo-vs-comparable cities comparison regarding: a. Number of claims filed b. Types and cost of treatment c. Timeliness in processing claims, delivery of service d. Amount of time injured workers stay off work, including 4850 and disability leave e. Financial incentives offered by the city to stay off work 2. Interviewing City and TPA staff involved in the workers compensation program a. Evaluate staff s experience, competence, efficiency and staffing levels as compared to volume of work. 3. An audit of City and TPA files including an analysis, review and comment on the following: a. Review a representative sample of open and closed claim files; b. Review claims handling, reserving and reporting procedures; c. Evaluate TPA adherence to existing contract including required documentation and performance standards; d. Timeliness, adequacy and accuracy of the claim reserves as facts of a claim change and the impact to the program; e. Timeliness and accuracy of payments to injured workers and the impact to the program; f. Effectiveness of medical control cost containment efforts as well as appropriate use of medical/nurse case managers and utilization review services; g. Adjuster direction and control of claims; h. Timeliness of initial reporting and updated, informative reports to the excess carrier(s); i. Adjuster direction and management of litigation, attorney assignment and resolution of disputed issues; j. Documented timely, adequate and comprehensive supervisory reviews; k. Adequacy of file organization and documentation including a valid, well considered and proactive plan of action; l. Evaluation of examiner and supervisor caseload size in comparison to both industry and program requirements; m. Chronological, comprehensive and accurate computerized file note documentation; P a g e 9

n. Effectiveness and thoroughness of the claims investigation techniques, including the appropriateness of the use and direction of outside investigative services; o. Evaluation of timely recognition and preservation of subrogation rights; p. Evaluation of resolution and closure of claims; q. General performance and competence of the administration services being provided; r. Areas of deficiencies in claims handling procedures and recommendation(s) to improve the process, providing specific examples; s. Identification and Recognition of return to work plans and adjuster efforts and coordination of these plans; t. Reconciliation of indemnity benefits at time of request for settlement authority and closure; u. Process and timeliness of adherence to meet critical deadlines (i.e., utilization review process, payment of claims, denial of claims, subrogation notices, eligibility for vocational rehabilitation services, etc.); v. Effective use of diary system; w. Evaluation of compliance with the California State Audit Unit timelines for furnishing of DWC Form-1 and filing of form 5020; and x. Comprehensive and timely 3-point contact per contract requirements. 4. Analysis and Evaluation of significant findings including current City needs and suggestions for improvements. SCOPE OF THE AUDIT The audit should include a review of an adequate number of open indemnity and medical only claims. Also, the audit should include a review of an adequate number of closed indemnity claims. A maximum of 50 claims are to be reviewed. The audit should include a comparison of the claims management activities against a standard defined in the report that will reduce as much as possible, subjective measurements. The report should thoroughly address the purposes of the report and areas outlined above, and should involve one-on-one interviews with at least the following: the Workers Compensation Analyst, the Interim Human Resources Director, the City Attorney and selected personnel employed by York (the City s TPA) and one or more workers compensation attorneys doing work for the City of Vallejo. THE AUDIT REPORT The report shall include an Executive Summary in addition to the sections outlined above. The Executive Summary is to include the third party administrator s organization chart, overall assessment, findings, recommendations, and a weighted overall audit scoring summary. All findings and recommendations will be reasoned, considered and specific to the City of Vallejo program. The audit completion timeframes are yet to be determined and will be negotiated subsequent to the award of the contract. At least two bound copies of the report shall be delivered to the offices of City of Vallejo by the date agreed upon as part of that negotiation. An electronic copy also shall be forwarded to Erika.leahy@cityofvallejo.net. We may request an in person meeting for you to present your results. P a g e 10

THE PROPOSAL Each Proposer shall submit a complete proposal with all information requested. content of the proposal will be as follows: The A. Cover Letter The cover letter should include the company name, the address, and the telephone number of the authorized person or persons to be used as the contact. The letter should indicate whether the Proposer is an individual, partnership or corporation. It must be signed by the individual, partner or an officer or agent authorized to bind the firm. A corporation submitting a proposal may be required to furnish a certificate as to its corporate existence and satisfactory evidence as to the officers authorized to execute the contract on behalf of the corporation. B. Table of Contents The proposal should include a table of contents listing each of the sections contained in the proposal. C. Qualifications of Auditor This section should include: 1. A description of at least two similar or related contracts under which the Proposer has provided services within the last year. 2. A brief description of the experience and qualifications of the proposed staff member(s) who will be conducting the audit. 3. A brief description of the organization. 4. A list of all public entities for which similar types of workers compensation claims audit services have been provided within the last five years. This list should include how long you have been conducting business with this entity and type of services provided. Please include the name, title, and phone number of person who can be contacted to discuss the Proposer s performance. 5. Include a sample of an audit completed within the past 12 months. D. Work Plan This section should contain the Proposer s work plan for providing the services required. E. Cost Data This section should contain a complete breakdown of all costs relating to the contents of the proposal, including the maximum total cost for a single year and multiyear contract. The costs shall include an itemized breakdown of the compensation required to accomplish the full performance of all tasks P a g e 11

outlined in the proposal and to make a formal presentation to the City s governing body. Consider per claim cost. All proposals shall remain firm for at least 90 days from the date set for proposal opening. SELECTION PROCESS All proposals must be received in our office by 5:00 p.m. on October 23, 2015. Please address all proposals and correspondence to: Erika Leahy Risk Analyst City of Vallejo 555 Santa Clara Street, Third Floor Vallejo, CA 94590 City of Vallejo anticipates reviewing the proposals by November 15, 2015 and awarding the contract by December 15, 2015. The right is reserved to reject any or all proposals and to waive technicalities, and to award a contract to the firm offering the most favorable terms in the opinion of City of Vallejo. False, incomplete, or unresponsive statement(s) in connection with a proposal may be sufficient cause for its rejections. The contract will not necessarily be awarded to the firm with the lowest fees; all proposals will be evaluated on their total content and not on any one factor. Some of the items to be considered are: Total costs Related experience References Ability to perform All Proposers will be notified of the decision of City of Vallejo, whose decision will be final. P a g e 12