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R-98-05-14-10B2 - 5/14/1998RESOLUTION NO. R -98-05-14-10B2 WHEREAS, the cit of Round Rock `iYiViii" 6��e '1, RESOLUTION NO. R -98-05-14-10B2 WHEREAS, the City of Round Rock previously entered into a Master Plan Document ("Plan Document") with Healthcare Benefits, Inc. to provide City Employees with health care, and WHEREAS, HealthCare Benefits, Inc. has submitted Amendment Number Three to the Plan Document, and WHEREAS, the City Council desires to enter into said Amendment No. Three to the Plan Document with HealthCare Benefits, Inc., Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Mayor is hereby authorized and directed to execute on behalf of the City Amendment Number Three to the Plan Document with HealthCare Benefits, Inc., to make the changes as more particularly described in the attached Amendment Number Three. The City Council hereby finds and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code, as amended, and the Act. RESOLVED this 14th day of May, ST: E LAND, City Secretary K:\WPDOCS\RESOLUTI\R80514B2.WPD/scg HARLES CUPPER, Mayor City of Round Rock, Texas AMENDMENT NUMBER THREE TO THE PLAN DOCUMENT OF CITY OF ROUND ROCK It is hereby agreed that the Plan Document describing the provisions of the Plan Number 1169, provided by City of Round Rock, the Plan Sponsor, is amended effective December 1, 1997 with respect to All Covered Employees, and their Covered Dependents, as follows: SECTION I - DEFINITIONS, page 5, item 2., Actively at Work is deleted in its entirety. SECTION I - DEFINITIONS, page 6, is amended by the addition of the following: Creditable Coverage means prior coverage held by an Employee or Dependent for which credit is given when calculating the application of the Pre -Existing Condition exclusion Creditable Coverage includes: a. a group health benefit plan; b. health insurance coverage; c. Medicare Part A or Part B; d. Title XIX of the Social Security Act (Medicaid), other than coverage consisting solely of benefits under Section 1928 of that Act; e. Chapter 55, Title 10, United States Code; f. a state health benefits risk pool; g. a public health plan as defined by federal regulations; h. a medical care program of a tribal organization or of the Indian Health Service; i. a health benefit plan under Section 5(e), Peace Corp Act; or j. a health benefit plan offered under Chapter 89 of Title 5. United States Code. Creditable Coverage does not include: a. accident only, or disability income insurance, or any combination thereof; b. coverage issued as a supplement to liability insurance; c. liability insurance, including general liability insurance and automobile liability insurance; d. Worker's compensation or similar insurance; e. credit -only insurance; f. coverage for onsite medical clinics; g. coverage for limited -scope dental or vision benefits; h. long-term care, nursing home care, home health care, or community-based care coverage or benefits, or any combination of these coverages; i. coverage for a specified disease or illness; j. hospital indemnity or other fixed indemnity insurance; k. Medicare supplemental health insurance, supplemental to the group coverage provided under Chapter 55, Title 10, United States Code, and similar supplemental coverage provided under a group plan; or I. other similar insurance coverage, specified in Federal regulations, under which benefits for medical care are secondary or incidental to other insurance benefits. Amendment Three Page 2 SECTION I - DEFINITIONS, page 8, item 23, is deleted in its entirety and substituted with the following: 23. Employee means a person who is a permanent full-time and part-time employee of the Employer, regularly scheduled to work for the Employer in an employee - employer relationship. Director(s) of corporate Employer shall not be deemed an Employee solely because of such directorship. However, board members and any eligible Dependents will be offered coverage under the Plan. Independent contractors and any other such person(s) not considered an employee of the Employer shall not be deemed an Employee for the purpose of the Plan. All Full-time Employees must be scheduled to work at least forty hours per week in order to be defined as a "full-time" Employee. All part-time Employees must be scheduled to work at least thirty hours per week for the Employer in order to be defined as a "part-time" Employee. SECTION I - DEFINITIONS, page 8, is amended by the addition of the following: Enrollment Date is the first day of coverage or, if there is a Waiting Period, the first day of the Waiting Period. SECTION I - DEFINITIONS, page 8, item 26, the wording regarding Evidence of Good Health is deleted in its entirety. SECTION I - DEFINITIONS, page 9, is amended by the addition of the following: Genetic Information means information about genes, gene products and inherited characteristics that may derive from an individual or a family member. This includes information regarding carrier status and information derived from laboratory tests that identify mutations in specific genes or chromosomes, physical medical examinations, family histories and direct analysis or genes or chromosomes. SECTION I - DEFINITIONS, page 11, is amended by the addition of the following: Late Enrollee includes those individuals who did not initially request coverage within thirty-one days of a Special Enrollment Event, as well as those individuals who specifically declined coverage and requested such change at a later date. SECTION I - DEFINITIONS, page 13, item 57, is deleted in its entirety and substituted with the following: 57. Pre -Existing; Condition means any condition for which medical advise, diagnosis, care or treatment was recommended or received within six months of a person's Enrollment Date. Treatment includes receiving services and supplies, consultations, diagnostic tests, or prescribed medicines. In order to be taken into account, the medical advice, diagnosis, care or treatment must have been recommended by, or received from, a Physician. SECTION I - DEFINITIONS, page 14, is amended by the addition of the following: Special Enrollment Event means an event that causes a change in family status as specified for Special Enrollment Periods under the Section entitled "ELIGIBILITY". Amendment Three Page 3 SECTION I - DEFINITIONS, page 14, is amended by the addition of the following: Special Enrollment Period means the period of enrollment for an Employee or Dependent who has a Special Enrollment Event as specified for Special Enrollment Periods under the section entitled "ELIGIBILITY". SECTION I - DEFINITIONS, page 15, is amended by the addition of the following: Waiting Period means the time between the first day of employment and the first day of coverage under the Plan. The Waiting Period is counted in the Pre -Existing Condition exclusion time. SECTION III - ELIGIBILITY, page 18, Subsection 1., ELIGIBLE CLASSES is deleted in its entirety and substituted with the following: ELIGIBLE CLASSES All Employees of the Plan Sponsor and its Affiliates or Subsidiaries, as defined in SECTION entitled "DEFINITIONS," are eligible for coverage under the Plan, subject to the following classifications: Classification Eligibility Period Class I - All Permanent Full-time eligible on the first of the month following the and Part-time Employees date of employment All Full-time Employees regularly scheduled to work forty hours per week are eligible for coverage under the Plan. All Part-time Employees regularly scheduled to work thirty hours per week are eligible for coverage under the Plan. The Waiting Period is the time between the first day of employment and the first day of coverage under the Plan. The Waiting Period is counted in the Pre - Existing Condition exclusion time. Each Employee who was covered under the Prior Plan, if any will be eligible on the Effective Date of this Plan. Any eligibility period or portion thereof satisfied under the Prior Plan, if any, will be applied toward satisfaction of the eligibility period of this Plan. If an Employee is hired on the first of the month, coverage shall be effective on=the first of the following month. SECTION IV - EFFECTIVE DATES OF COVERAGE, pages 19 and 20, Subsection 2., EFFECTIVE DATES, is deleted in its entirety and substituted with the following: 2. EFFECTIVE DATES Coverage must be requested on a form fumished by the Employer. When so requested, such coverage will become effective as follows: 1. on the date the Employee becomes eligible, provided the enrollment form is received by the Employer on or before such date; 2. on the date the enrollment form is received by the Employer, provided it is within 31 Amendment Three Page 4 days of the date of eligibility; 3. on the date of the Special Enrollment Event provided the enrollment form is received by the Employer within 31 days of the Special Enrollment Event. The Pre -Existing Condition exclusion will apply for 12 months, but may be reduced or eliminated by any period of Creditable Coverage; or 4. if the request for coverage is made more than 31 days after the date the Employee is eligible or after the coverage was voluntarily terminated at the Employee's request, coverage will become effective for the Late Enrollee on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Condition exclusion will apply for 12 months, but may be reduced or eliminated by any period of Creditable Coverage. The Enrollment Date for a Late Enrollee is the first day of coverage. Thus, the time between the date a Late Enrollee first becomes eligible for enrollment under the Plan and the first day of coverage is not treated as a Waiting Period. SECTION IV - EFFECTIVE DATES OF COVERAGE, Subsection 3., ANNUAL ELECTION, REJECTION AND WITHDRAWAL OF COVERAGE, page 20, is amended by the addition of the following: ANNUAL ELECTION, REJECTION AND WITHDRAWAL OF COVERAGE City of Round Rock has designated the month of November as an annual open enrollment period during which Employees may enroll for coverage or withdraw from the Plan. Coverage elected during the annual open enrollment period will become effective December 1st. If the Employee does not complete and return a new election form prior to December 1st each year, the Employee will be treated as having elected to continue the benefit coverage then in effect for the following, year. The coverage elected by an Employee may not be changed except during an annual open enrollment period, unless there is a Special Enrollment Event as described under Special Enrollment Periods later in this section. Any Special Enrollment Event must be reported to the Employer within 31 days of the event or the provisions for Late Enrollees will apply. SECTION IV - EFFECTIVE DATES OF COVERAGE, pages 20 and 21, Subsection 3., CONDITIONS, is deleted in its entirety and substituted with the following: 3. CONDITIONS 1. Coverage of the Employee's natural child born after the Effective Date or a child of a Covered Employee for whom the Employer had received a court order requiring that health coverage be provided will automatically be in effect from (a) the date of birth for the newborn child or (b) the date the court order is received by the Employer, through the 31st day following such date. For coverage to continue for the newborn child or the child added by court order, the Employer must receive notification from the Employee on an enrollment form for the Dependent addition during the 31 -day period. If the Covered Employee waits until after this 31 -day period to add the child, the coverage will become effective as described in 5. below. 2. If the Covered Employee acquires a Dependent while he is eligible for Dependent Coverage, coverage for the newly acquired Dependent will become effective on the date the Dependent becomes eligible, provided the Covered Employee makes application to the Employer within 31 days of the eligibility date and make any required contributions. Amendment Three Page 5 3. Any reference in the Plan to the Dependent being covered means that the Dependent is covered for Dependent Coverage, except as may be provided under 2., above. 4. No Dependent Coverage will become effective for the Covered Employee unless the Covered Employee is, or simultaneously becomes, covered for Personal Coverage. 5. If the Employee specifically declines coverage, Personal or Dependent, and at a later date the Employee requests coverage hereunder, such coverage, Personal or Dependent, for the Late Enrollee will become effective on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Condition exclusion will apply for 12 months, but may be reduced or eliminated by any period of Creditable Coverage. 6. No Person may be simultaneously covered under the Plan as both an Employee and as a Dependent. 7. When both spouses are covered Employees under this Plan and one spouse terminates employment, the remaining Covered Employee may enroll the Spouse or other Covered Dependents within 31 days after the terminated spouse's last day of active employment. Coverage is effective on the first of the month following the end of employment. If the Employee does not enroll his spouse or Dependent children within 31 days of the termination and chooses to apply at a later date, -coverage for the Late Enrollee will become effective on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Condition exclusion will apply for 12 months, but may be reduced of eliminated by any period of Creditable Coverage. 8. Benefits payable on behalf of a Dependent previously covered under the Plan as an Employee shall not exceed the maximum benefits that would have been payable during such period had the Dependent remained covered as an Employee. 9. Benefits payable on behalf of an Employee previously covered under the Plan as a Dependent shall not exceed the maximum benefits that would have been payable during such period had the Employee remained covered as a Dependent. 10. Benefits payable on behalf of an Employee or Dependent covered under the Plan whose employment or coverage is terminated and who is subsequently rehired or reinstated at any time shall be limited to the maximum benefits that would have been payable had there been no interruption of employment or coverage. 11. Any benefits received prior to the Effective Date of the Plan will be applied to the benefit maximum of the Plan as indicated in the "SCHEDULE OF BENEFITS". The Enrollment Date for a Late Enrollee is the first day of coverage. Thus, the time between the date a Late Enrollee first becomes eligible for enrollment under the Plan and the first day of coverage is not treated as a Waiting Period. SECTION IV - EFFECTIVE DATES OF COVERAGE, page 21, is amended by the addition of the following: SPECIAL ENROLLMENT PERIODS The Enrollment Date for anyone who enrolls under a Special Enrollment Period is the first date of the coverage. Thus, the time between the date a special enrollee first becomes eligible for enrollment under the Plan and the first day of.coverage is not treated as a Waiting Period. An Employee or Dependent, who is eligible, but not enrolled in this Plan, may enroll if the following conditions are met: 1. Loss of Other Coverage Amendment Three Page 6 a. the Employee or Dependent was covered under another group benefit plan or had health insurance coverage at the time coverage under this Plan was offered; and b. the Employee declined coverage under this Plan, in writing, on the basis of the other coverage; and c. the Employee or Dependent lost the other coverage as a result of legal separation, divorce, death, termination of employment, a reduction in the number of hours of employment or employer contributions toward such coverage were terminated. If the Employee or Dependent lost the other coverage as a result of the individual's failure to pay premiums or for cause (such as making a fraudulent claim), that individual does not have a special enrollment right. 2. COBRA Coverage Exhausted 3. Newbom Children Coverage of the Employee's natural child born after the Employee's Effective Date will be in effect for 31 days after the birth of the child. For coverage to remain in effect beyond 31 days, the Employee must submit a completed enrollment form to the Employer and make any required contributions. If the request for coverage is submitted after -this 31- day period, the provisions for Late Enrollees will apply. 4. Court Ordered Dependents Coverage of a child of an Employee for whom the Employer has received a court order requiring that health coverage be provided will automatically be in effect from the date the court order is received by the Employer, through the 31st day following such date. For coverage to remain in effect beyond 31 days, the Employee must submit a completed enrollment form to the Employer and make any required contributions. If the request for coverage is submitted after this 31 -day period, the provision for Late Enrollees will apply. 5. Other Dependents Coverage for a Dependent, other than a newbom child or a court ordered Dependent child of the Employee, will be in effect from the date the Dependent is eligible provided the Employee submits a completed enrollment form to the Employer within 31 days and make any required contributions. If the request for coverage is submitted after this 31 -day period, the provisions for Late Enrollees will apply. If the Employee acquires an eligible Dependent through marriage, birth, adoption or placement for adoption, the Employee will be able to enroll himself and all eligible Dependents provided the Employee submits a completed enrollment form to the Employer within 31 days of the Special Enrollment Event and makes any required contributions. SECTION VI - CONTINUATION OF COVERAGE, CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 1985 (COBRA), pages 24 & 25, is deleted in its entirety and substituted with the following: SECTION VI - CONTINUATION OF COVERAGE CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 1985 (COBRA) If a Covered Employee's health coverage, including dental coverage if applicable, is terminated under the Plan for any of the "Qualifying Events" listed below, such Covered Employee shall have the right to elect to continue coverage under the Plan. Amendment Three Page 8 Extending, benefits terminate earlier if: 1. the Qualified Beneficiary is determined by SSA to no longer be disabled: a. the extended coverage is canceled the month beginning more than 30 days after the final determination date; and b. the Qualified Beneficiary is responsible for notifying the Plan Sponsor within 30 days of the final determination. 2. the Plan Sponsor ceases to provide health coverage to any Employees; 3. the Qualified Beneficiary fails to make, when due, the required contribution payment; 4. the Qualified Beneficiary becomes covered under any other group health plan which does not contain any exclusion or limitation with respect to any Pre -Existing Condition; or 5. the Qualified Beneficiary becomes entitled to Medicare benefits. SECTION VIII - SPECIAL CONDITIONS, page 36, the wording regarding PRE-EXISTING CONDITION is deleted in its entirety and substituted with the following: PRE-EXISTING CONDITION. Pre -Existing Condition is any condition for which medical advise, diagnosis, care or treatment was recommended or received within six months of a person's Enrollment Date. Treatment includes receiving services and supplies, consultations, diagnostic tests or prescribed medicines. In order to be taken into account, the medical advise, diagnosis, care or treatment must have been recommended by, or received from, a Physician. The Pre - Existing Condition exclusion will apply for twelve months, but may be reduced or eliminated by any period of Creditable Coverage. The Pre -Existing Condition exclusion does not apply to the following: 1. Waiting Periods; 2. pregnancy; 3. conditions resulting from domestic violence; 4. Genetic Information; 5. a newborn child; 6. a child who is adopted or placed for adoption; or 7. a court ordered Dependent. If the Covered Employee or Dependent has Creditable Coverage with Tess than a 63 -day gap between the loss of the previous coverage and the enrollment date under this Plan, then the length of the Pre -Existing Condition exclusion will be reduced or eliminated by the amount of Creditable Coverage. If, after Creditable Coverage has been taken into account, there will still be a Pre -Existing Condition exclusion imposed on the Covered Person, the Covered Person will be notified. A Covered Person may request a certificate of Creditable Coverage for the prior plan. The Employer will assist any Covered Person in obtaining a certificate of Creditable Coverage from a prior plan. Amendment Three Page 9 SECTION X - LIMITATIONS AND EXCLUSIONS APPLICABLE TO MEDICAL BENEFITS, pages 46 & 47, item 8, is deleted in its entirety and substituted with the following: 8. expenses due to any Pre -Existing Condition as specified for Pre -Existing Condition under the section entitled "SPECIAL CONDITIONS"; SECTION XIX - MISCELLANEOUS MEDICAL EXPENSE PROVISION, pages 75 & 76, is deleted in its entirety and substituted with the following: SECTION XIX - MISCELLANEOUS MEDICAL EXPENSE PROVISION Effect of Coverage under a Health Maintenance Organization Plan. 1. Each Employee in an eligible class who has elected coverage under any Health Maintenance Organization Plan (herein referred to as "HMO Plan") offered by an employer shall be excluded from coverage as provided by this Plan, except Dental Expense Benefits (if provided), subject to this section with respect to himself and his eligible Dependents immediately on and after the effective date of any coverage under such HMO -Plan. 2. Each Employee in an eligible class who resides in an HMO Plan enrollment area and who is a covered individual under such HMO Plan as offered by an employer, may elect coverage for himself and his covered Dependents under the Plan annually during an annual open enrollment period determined in advance by the Plan Sponsor. Any coverage elected will become effective on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Condition exclusion will apply for 12 months, but may be reduced or eliminated by any period of Creditable Coverage. 3. Each Employee in an eligible class who is covered under an HMO Plan when he changes residence out of the HMO Plan enrollment area, or when the HMO Plan discontinues operations for financial or other reasons, may elect to change to coverage under this Pian for himself and his Covered Dependents. Any such coverage under the Plan will become effective as follows: a. with respect to an Employee who makes written request prior to or within 31 days following his change in residence or the date the HMO discontinues operations, on the later to occur of: (1) the date he makes written request, or (2) the date of his change in residence or such discontinuance of operations, without any restrictions as to waiting periods or Pre -Existing Conditions, or b. with respect to an Employee who makes written request after 31 days following his change in residence or the date the HMO discontinues operations, coverage elected will become effective on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Condition exclusion will apply for 12 months, but will be reduced or eliminated by any period of Creditable Coverage. Those portions of the Plan which provide extensions of benefits to Covered Persons by reason of disability will cease to apply on and after the effective date of any change in coverage to an HMO Plan. However, if coverage is not provided for a covered family member under the HMO Plan on the date coverage would otherwise become effective because the family member is confined in a Hospital not affiliated with the Health Maintenance Amendment Three Page 10 Organization, and if the Employee submits satisfactory proof to the Plan Sponsor that the HMO Plan contains an extension of benefits provision applicable to disability, then coverage for such confined family member may be extended under this Plan for the same length of time and for the same conditions an extension is provided under the HMO Plan, but not beyond the earliest to occur of (a) the end of a 90 day period commencing the date coverage would otherwise become effective, (b) cessation of confinement, or (c) the date this Plan terminates. 5. All of the coverage provided under this Plan is subject to the provisions of this section, and no coverage is afforded under this Plan for any charge for a service rendered or a supply furnished under an HMO plan. 6. An Employee who has elected coverage for himself under an HMO plan may not cover his Dependents under this Plan, nor may such an Employee be covered under this Plan if the Employee has coverage for his Dependents under an HMO plan. 7. If an Employee's Dependent has elected membership in a qualified HMO plan as an employee of another employer, no benefits are payable under this Plan for treatment of any Injury or Illness of any such Dependent, to the extent that such Dependent is entitled to coverage, services or treatment as a result of membership in the HMO plan, regardless of whether such coverage, services or treatments are received through the qualified HMO. 8. If an Employee and his Dependent(s) are covered under an HMO plan, such Dependent(s) may, in the event of the death of such Employee, elect to change to coverage under this Plan, provided such Employee was in an eligible class at the time of death and provided such Dependent(s) is eligible. Any such coverage under this Plan will become effective as follows: a. with respect to a Dependent who makes written request within 31 days following the death of such Employee, on the date he makes written request, without any other restrictions as to waiting periods or Pre -Existing Conditions, or b. with respect to a Dependent who makes written request after 31 days following the death of the Employee, any coverage elected will become effective on the first of the month following the Employer's annual open enrollment period. The Pre -Existing Conditions exclusion will apply for 12 months, but may be reduced or eliminated by any period of Creditable Coverage. Payment of the Administration Fee for the coverage provided by the Plan, as amended, for coverage periods beginning on and after the effective date of this amendment, shall constitute acceptance of the terms of this amendment by the Employer. Amendment Three Page 11 This amendment shall be attached to and form a part of the Plan and shall not be held to alter or affect any of the terms of such Plan other than as specifically stated. Dated at Round Rock, Texas, this first day of December, 1997. CITY OF ROUND ROCK B Authorized R p - . entative HEALTHCARE BENEFITS, INC. AUth ed Rep ent tive Stop -Loss Policy (herein called the Policy) between Blue Cross and Blue Shield of Texas, Inc. Dallas, Texas (herein called BCBSTX) and _City of Round Rock Round Rock, Texas 78664-5299 (herein called the Stop -Loss Policyholder) Account Number 36076 Effective: December 11997 This Stop -Loss Policy covers those items of the Master Benefit Plan Document and any Supplemental Benefit Plan Document as indicated in Item I of the Exhibit. Article I -- Definitions As used in this Polic : A. Clainiability means the total amount of Paid Claims that are the responsibility of the Policyholder each Policy Year. Claim Liability will be calculated for each Policy Year in accordance with the formula indicated in Item III of the Exhibit. B. Exhibit means the attached specifications setting out certain particulars of this Policy or any other subsequent set of specifications supplied by BCBSTX as a replacement Exhibit. The specifications or items of the Exhibit shall be applicable for the time periods indicated in the Exhibit, except that any item of the Exhibit may be changed: 1. Any time the Master Benefit Plan Document or any Supplemental Benefit Plan Document is modified or changed and such changes or modifications are approved by BCBSTX as provided in Section D of this Article 1; or 2. If there is a significant change in the number of Employees covered under the Master Benefit Plan Document (a significant change being 10% or more over a one-month period or 25% or more over a three-month period). C. Ex ected Paid Claims means the total amount of Paid Claims that are actuarially expected to be paid each Policy Year. Expected Paid Claims will be calculated for each Policy Year. D. Master Benefit Plan Document means the document attached to and made a of this Policy which describes the benefits and provisions of the Plan, and any amendments or changes thereto which are approved by BCBSTX in writing. Form No. ASO-SLP-6(Rev.11/95 24/12) E. Patel Claims means the total of all benefits payable under the benefit provisions of those items of the Master Benefit Plan Document and any Supplemental Benefit Plan Document indicated a lic in Item I of the Exhibit which were incurred during the twelve-month period immediatelypreceding the current Policy Year or during such Policy Year and paid (meaning checks issuedPo able funds deposited into the Plan's claims payment banking account) during the current and Policy Year covering ii g under the terms of this Policy and not paid by, billed to, reported to, or received by the Employee, the Stop -Loss Policyholder, or the Stop -Loss Policyholder's agents, brokers or administrators,prior to the effective date of this Policy. "Paid Claims" shall not include: P 1. Claims incurred after the termination date of this Policy; or 2. for Stop Loss Claims purposes, claims incurred more than twelve months prior to the be of the current Policy Year; or beginning 3. Claims paid after the current Policy 'Year; or 4. Claims paid more than 12 (twelve) months after the Incurral Date; or 5. Extra contractual damages of any nature, compensatory damages or any similar damages however assessed, or any payments made as an exception to the Master Benefit Plan Document or any Supplementary Benefit Plan Document, or as settlement of a lawsuit; or 6. Any payments made which are not provided for as benefits under the Master Benefit Plan or any Supplementary Benefit Plan Document, or which are limited or excluded under such Documents; or 7. Any payments of benefits which are interpreted by the Stop -Loss Policyholder as coming within the terms of the Master Benefit Plan Document or any Supplementary Benefit Plan Document if BCBSTX notifies the Stop -Loss Policyholder that it does not agree with that interpretation. F. Participant means an individual Employee or Dependent whose coverage has become effective under the Master Benefit Plan or Supplementary Benefit Plan Documents. G. Plan means the program of benefits adopted by the Stop -Loss Policyholder on behalf of its Employees and the eligible Dependents of such Employees as described in the Master Benefit Plan or Supplementary Benefit Plan Documents. H. Policy year means each consecutive 12 -calendar -month period during which this Policy is in effect, the first period commencing with the effective date of this Policy. I. Ston -Loss Claims means the amount of Paid Claims for which BCBSTX assumes responsibilitya risk for payment, which is the sum of Individual (Specific) Stop -Loss Claims and A ne Stop -Loss Claims, Aggregate 1. If, during any calendar month occurring within a Policy Year, Paid Claims for a Participant exceed the amount indicated in Item IV A of the Exhibit, such excess, up to the maximum amounts indicated, if any, shall be referred to in this Policy as Individual (Specific) Ston -Loss )aims. Form No. ASO-SLP-6(Rev.1 1/95 24/12) 2. If, during any Policy Year, Paid Claims, less Individual (Specific) Stop -Loss Claims, if any, exceed the Point of Attachment indicated in Item IV. B. of the Exhibit, such excess, if any, shall be referred to in this Policyas A �gree�ate Stop -Loss Claims. J.Stop-Los Premium means the monthly consideration required by BCBSTX for the risk assumed for the Stop -Loss Insurance in Item IV of the Exhibit, such amount to be due and payable on or before the first of each month—the first such month being the month during which this Policy becomes effective. Each Stop -Loss Premium amount is calculated in accordance with the formula indicated in Item II of the Exhibit. K. Trust means the Trust established by the Stop -Loss Policyholder in regard to the Master Benefit Plan and Supplementary Benefit Plan Documents. L. Third Party Administrator means Healthcare Benefits, Inc. Article II — Settlements A. Remittance. BCBSTX shall bill the Stop -Loss Policyholderd and the Stop -Loss Policyholder P Premium amount due each month in a vance for the Sto -Lass l remit payment on or day of each month. A daily charge equal to the lesser of the percen age amount shown inre Iteme first f the Exhibit, or the maximum rate permitted by state law, multiplied times the amount due, will be charged for late remittance of any amounts owed by the Stop -Loss Policyholder. A remittance will be considered received when actually delivered into the possession or control of BCBSTX at its Home Office in Dallas County, Texas. B. Individual (Specific) Stop Loss Settlement, BCBSTX will furnish the Stop -Loss Policyholder an Individual (Specific) Stop -Loss Claim report after the end of each full calendar month occurring within a Policy Year, in which Individual (Specific) Stop -Loss Claims were reported. Within 10 days after issuance of said report, BCBSTX will settle with the Stop -Loss Policyholder for any Individual (Specific) Stop -Loss Claims involved; provided, however, if the Plan, the Administrative Services Agreement between the Stop -Loss Policyholder and the Third Party Administrator, or this Policy are terminated on a date other than the end of a Policy Year, reports will be furnished and settlements will be made, as described herein, for only those full calendar months occurring within that portion of any Policy Year immediate] y benefits shall not extend beyond the termination date of this Poling icy, y, unn. lessdthisual (if is) terminated at the end of the Policy Year. PolicyHated C. A re ate Stop -Loss Settlement or Accountin 1. Monthly Settlement and Accounting a. Settlement. Where shown in Item III of the Exhibit to be applicable, BCBSTX will furnish the Stop -Loss Policyholder with a Monthly Aggregate Stop -Loss settlement report within thirty days after the end of each month occurring within an Accounting Period in which A ge(at0e Stop -Loss Benefits were paid. Within ten (10) days after issuance of such report, BCBSTX will settle with the Stop -Loss Policyholder for any Aggregate Stop -Loss Insurance involved. Based on any banking arrangements in force and the settlement results, Aggregate Stop -Loss Insurance settlement amounts reported will either be paid directly to the Stop -Loss Policyholder by BCBSTX or credited to a designated bank account. Form No. ASO-SLP-6(Rev.11/95 24/12) b. Acco untin . BCBSTX will furnish the Stop -Loss Policyholder an Accounting Period Settlemen Report within ninety (90) days after the end of each Accounting Period. Ift t that the amount (calculated using the factor shown in Item III of the Exhibit multiplied reflects the total number of employees and dependents participating in the plan), if any, exceeds Paid Claims (less Specific Stop -Loss benefits paid, if any), the difference between the two amounts shall be termed the Aggregate Stop -Loss Accounting Period Surplus if the reverse is true, the difference between the two amounts shall be termed the Aggregated Stop -Loss Accounting Period Deficit. c. Based on the report provided for in the preceding paragraph, the following applies: (1) If the report reflects an Aggregated Stop -Loss Monthly Accounting Period Deficit, such deficit shall be combined with any deficits carried forward from previous Accounting Periods and shall be termed the Aggregate Stop -Loss Standing Deficit. The resulting Aggregate Stop - Loss Standing Deficit shall then be carried forward to apply to future Monthly Accounting ccountin g (2) If the report reflects an Aggregate Stop -Loss Accounting Period Surplus, such -surplus shall first be applied against any Aggregate Stop -Loss Standing Deficit. Any remaining surplus shall then be carried forward to future Monthly Accounting Periods. (3) When an Aggregate Stop -Loss Accounting Period Deficit is determined, BCBSTX will settle with the Stop -Loss Policyholder for that month. Monthly accounting, thereafter, will be done for every month of the remaining Policy year to determine whether money is payable to the Stop -Loss Policyholder or BCBSTX. Article III — Audits and Adjustments A. Audits. BCBSTX, or its duly authorized agent, shall have the right, upon reasonable notice given, to audit the books and records of the Stop -Loss Policyholder (and any agents, brokers, or administrators of the Stop -Loss Policyholder) during normal working hours, or to require that copies of pertinent documents be provided, in order to verify the validity of any benefits payable under he Master Benefit Plan or Supplementary Benefit Plan Documents which will result in payments being made under this Policy.n B. Retroactive Adiuctment. To the extent that later occurring events such as those resultingfrom coordination of benefits, subrogation, audits or other legal or administrative actions or causes necessitate adjustments to payments made under the benefit provisions of the Master Benefit Plan Document, appropriate adjustments shall also be made to any payments this Stop -Loss Policy to reflect said benefit payment adjustments. The Stop-Losselnts Pocmadeyholderdis required to immediately notify BCBSTX of any such recoveries or benefit payment adjustments as soon as they are known to the Stop -Loss Policyholder, it agents or its Third Party Administrator and to pay to BCBSTX immediately upon receipt any funds recovered from such later occurring events which would have the effect of decreasin ast g , present, or future Stop -Loss benefit payments. Any resulting adjustments to Stop -Loss Policy Stop -Loss settlement occurring after notificationpaymentsprovidedll tforl uy ndeer thiisaPolicy ade themndf sthe next hall be reflected in the Settlement Report; provided, however, BCBSTX reserves the right to make such adjustments at any time after notification is received from the Stop -Loss Policyholder. Should the notice necessitating an adjustment occur after all settlements provided for in this Policy have been made, or should BCBSTX elect to make an off -cycle adjustment, an Adjustment Report will be provided by BCBSTX within 30 days after receipt of notification by the Stop -Loss Policyholder and a settlement will be made by the parties within ten days thereafter. Form No. ASO-SLP-6(Rev.11/95 24/12) Article IV — General Provisions A. Arbitration. In the event the parties fail to agree with respect to any matter covered by this Policy, the question in dispute shall be submitted for arbitration. The arbitrator shall be selected as follows: upon declaration by one of the parties hereto that a deadlock exists, the parties shall selectan arbitrator; if no appointment is made within 1.0 days after the deadlock is declared and the amount in contest is in excess of $200, the American Arbitration Association shall be the arbitrator. If the amount in question is $200 or less, BCBSTX shall select an independent third party to be the arbitrator. The arbitrator will submit a decision within 10 days after appointment and such decision shall be binding on the parties hereto. Expenses incurred in the arbitration process shall be borne equally by the parties. B.Assi��nment. No part of this Policy, or any rights, duties, or obligations described herein, shall be assigned or delegated without the prior express written consent of both parties. BCBSTX's standing contractual arrangements for the acquisition and use of facilities, services, supplies, equipment and personnel from other parties shall not constitute an assignment under this Policy. C. Ca tions. Captions appearing in this Policy and its exhibits are provided for convenience only and in no way define, limit, construe or describe the scope of sections or paragraphs to which they are inserted. D. Enforcement. Any delay or inconsistency in the enforcement of any part of this Policy shall not constitute a waiver of any rights with respect to the enforcement of this Policy at any future date nor shall it limit any remedies which may be sought in any action to enforce any provision of this Policy. E. Entiretx. This Policy and any exhibits or amendments shall constitute the entire agreement between the parties for the purposes of this Policy and shall supersede any and all prior agreements or understandings, either oral or in writing, between the parties respecting the subject matter herein. F. Forces Maieure and Maiesture. Neither party shall be liable for failure to perform its obligations under this Policy if prevented from doing so by a cause or causes beyond its commercially reasonable control including, but not limited to, acts of God or nature, fires, floods, storms, earthquakes, riots, strikes, wars or restraints of government. G. Gender and Mode. The use herein of a personal pronoun in the masculine or feminine gender or in the singular or plural mode, shall be deemed to include the opposite gender or mode unless the context clearly indicates the contrary. H. Governin Law. This Policy shall be governed by, and shall be construed in accordance with, the laws of the State of Texas. All obligations created hereunder are performable in Dallas County, Texas and all disputes arising out of this Policy will be resolved in Dallas County, Texas. I. Indemnification A regime ,t. In the event BCBSTX, its officers, directors, employees or agents are made parties to any judicial or administrative proceeding arising in whole or in part out of any function performed by one or more of them under this Policy, the Stop -Loss Policyholder shall hold them harmless for all judgments, settlements, and costs (including attorney's fees) which they incur or pay in connection therewith, except that the Stop -Loss Policyholder shall not reimburse BCBSTX for the amount of any judgment or award (or attorney's fees with respect thereto) if the court rendering the judgment or the agency making the award determines that the liability underlying the Form No. ASO-SLP-6(Rev.11 /95 24/12) judgment or award was caused by the willful misconduct or gross negligence of BCBSTX, its officers, directors, employees or agents. J. Legal Construction. Should any provision(s) contained in this Policy be held to be invalid, illegal, or otherwise unenforceable, the remaining provisions of the Policy shall be construed in their entirety as if separate and apart from the invalid, illegal or unenforceable provision(s) unless such construction were to materially change the terms and conditions of the Policy. K. Limitation of Liability. Liability for any errors or omissions by BCBSTX (or its officers, directors, employees, agents, or independent contractors) in the administration of this Policy, or in the performance of any duty of responsibility contemplated by this Policy, shall be limited to the maximum benefits which should have been paid under the Policy had the errors or omissions not occurred (including BCBSTX's share of any arbitration expenses incurred under the Policy), unless any such errors or omissions are adjudged to be the result of willful misconduct or gross negligence by BCBSTX. L. Modification. Except as provided for in Section D of Article I, this Policy shall not be. amended or modified in any manner other than by an instrument in writing executed by the parties. M. Notice and Satisfaction. The Stop -Loss Policyholder agrees to give BCBSTX specific notice in writing of any complaint or concern the Stop -Loss Policyholder may have about the performance of this Policy and to allow BCBSTX 30 days in which to make necessary adjustments or corrections to satisfy any such complaint or concern prior to taking any further action with regard to the complaint or concern. N. Right to Terminate. This Policy will terminate if the Plan terminates or the Administrative Services Agreement between the Stop -Loss Policyholder and the Third Party Administrator terminates, or may be terminated at the end of any Policy Year by either party pursuant to written notice given by either party to the other not less than 30 days in advance of the termination date. Upon such termination, final settlements shall be effected in accordance with the provisions of Article II hereof. BCBSTX reserves the right to terminate this Policy, without prior notice, for failure of the Stop -Loss Policyholder to pay Stop -Loss Premiums as required herein. 0. Subsidiaries. BCBSTX and its subsidiaries and affiliates have reciprocal agreements under which they will allocate funds between its corporations resulting from any settlements, and the Stop -Loss Policyholder shall have no responsibility for, or interest in, such allocation. Form No. ASO-SLP-6(Rev.11/95 24/12) P. Taxes. Any premium amounts due under this Policy will y the amount p , increased or adjudged d ue by any lawful authority on or after the effective of any taxes imposed, wl automatically be increased b date of this Policy, which directly pertain to this Policy and which BCBSTX is required to pay or remit, whether relating to fees, services, benefits, payments or any other aspect of this Policy, the Master Benefit Plan or Supplementary Benefit Plan Documents. For Blue Cross By: Rogers nd Blue Shield of Texas, Inc. (BCBSTX) SCE oleman, President For City of R By: nd Rock (Stop Loss Policyholder) Title: Form No. ASO-SLP-6(Rev,11/95 24/12) December 30, 1997 Date Date Exhibit No. 1 Schedule of Specifications to Stop -Loss Policy City of Round Rock Account Number 36076 These specifications shall apply to the Stop -Loss Policy between BCBSTX and the above Stop -Loss Policyholder for the current Policy Year beginning December 1, 1997,.and ending November 30, 1998. Item IStatement of Benefits Master Benefit Plan Document. The benefits which shall be covered under this Stop -Loss Policy are those described in the attached All exclusions and limitations contained in the Master Benefit Plan Document shall apply, including specifically those described in the Limitations and Exclusions Section(s) of such Document. Item II — Ston -Loss Premium The Stop -Loss Premium is the sum of the Individual Stop -Loss Premium and Aggregate Stop -Loss Premium amounts calculated as follows (amounts shown are applicable for the current Policy Year). In Policy period. order for Policy benefits shown below to be available, Stop -Loss Premium must be paid for the entire A. Individual Stop -Loss Premium shall be calculated monthly and shall be equal to the sum of the amounts obtained by multiplying the number of Employees covered for a particular month by: for each Employee only for each Employee/child(ren) for each Employee/spouse for each Employee/family $ 24.50 $ 66.16 $ 66.16 $ 66.16 B. Aggregate Stop -Loss Premium shall be calculated monthly and shall be equal to the sum of the amounts obtained by multiplying the number of Employees covered for a particular month by: $ 2.54 for each Employee only $ 2.54 for each Employee/child(ren) $ 2.54 for each Employee/spouse $ 2.54 for each Employee/family Form No. ASO-SLP-6(Rev.11/95 24/12) Item III — Claim Liabilit Factors Claim Liability (Monthly Maximum) for claims shall be calculated monthly and shall be equal to the su of the amounts obtained by multiplying the number of Employees covered for a particular month nth bythe following factors: m $ 240.05 for each Employee only $ 240.05 for each Employee/child(ren) $ 240.05 for each Employee/spouse $ 240.05 for each Employee/family Item — Sto -Loss Insurance Options A. Individual Stop -Loss Insurance X Applied For. 1. For N/A, the amount of Paid Claims (claims incurred during the twelve-month period immediately preceding the current Policy Year or during such Policy Year and paid during the current Policy Year, as defined in the Stop Loss Policy) in excess of the Point of Attachment of $N/A per Participant. Individual Stop -Loss benefit payments shall not exceed a maximum of $ N/A for N/A for the indicated Policy Year. 2. For each other Participant, the amount of Paid Claims (claims incurred during the twelve-month period immediately preceding the current Policy Year or during such Policy Year and paid during the current Policy Year, as defined in the Stop Loss Policy) in excess of the Point of Attachment of $ 30,000 per Participant. Individual Stop -Loss benefit payments shall not exceed a maximum of $970,000 per Participant for the indicated Policy Year. Not Applied For. B. Aggregate Stop -Loss Insurance X Applied For. The amount of Paid Claims (claims incurred during the twelve-month period immediately preceding the current Policy Year or during such Policy Year and paid during the current Policy Year, a defined in the Stop Loss Policy) which exceeds 125% of Expected Paid Claims. less claimspaid under the Individual (Specific) Stop Loss. Such percentage shall apply for 12 months for the indicated Policy Year. Aggregate Stop -Loss benefit payments shall not exceed a maximum of l 000 000 for the indicated Policy Year. Not Applied For. Form No. ASO-SLP-6(Rev.11/95 24/12) Item V —Daily Charge The daily charge rate shall be .05% per day (which would equate to an annual percentage rate of 18%). For Blue Cross and Blue Shield of Texas, Inc. (BCBSTX) By: Rogers 7Coleman, President DPCQmbpr 30, 1997 Date For City of R nd Rock (Stop Loss Policyholder) By:✓�-►h Title: /'?' //4 vc/e, Form No. ASO-SLP-6(Rev.11/95 24/12) 5-J -98 Date DATE: May 8, 1998 SUBJECT: City Council Meeting - May 14, 1998 ITEM: 10.B.2. Consider a resolution approving Amendment Number 3 to the Master Benefit Plan Document for the City of Round Rock. This amendment to the Health Plan document formalizes changes made as of December 1, 1997 with respect to All Covered Employees, and their Covered Dependents in regard to Pre-Existing Conditions, This amendment is a clarification of definitions of the City Health/Dental Plan Document only and does not relate to service provided or cost of the plan. Staff Resource Person: Teresa Bledsoe, Human Resources Director.