Okaloosa County BOCC — September 16, 2014 — Johns Eastern Contract 14-17

4S JOHNS EASTERN COMPANY, INC. Claim Adjusters and Third Party Administrators SERVICE CONTRACT FOR MULTIPLE LINE CLAIMS HANDLING THIS SERVICE CONTRACT FOR WORKERS’ COMPENSATION AND LIABILITY CLAIMS HANDLING is effective for all purposes as of the 1* day of October, 2014, by and between OKALOOSA COUNTY BOARD OF COUNTY COMMISSIONERS (referred to as the “Client”), and JOHNS EASTERN COMPANY, INC. (referred to as the “Service Agent”). WITNESSETH: WHEREAS, the Client has undertaken to self-insure its Workers’ Compensation liability in accordance with the Workers’ Compensation Law and other applicable statutes and regulations; and WHEREAS, the Service Agent is engaged in the supervision and administration of programs for self-insured employers; WHEREAS, the Client desires to engage the Service Agent for, and the Service Agent desires to assist the Client in workers’ compensation claims handling; NOW, THEREFORE, for and in consideration of the premises and of the mutual obligations, performance of services, and payment of compensation set forth herein, the parties agree as follows: 1. Engagement. The Client hereby engages the Service Agent to supervise and administer the Self- Insured Workers’ Compensation Program of the Client in accordance with the Workers’ Compensation Law as adopted and amended by the State of Florida (the “Law”) and the applicable rules and regulations as promulgated by the applicable agencies of the State of Florida relating to the Law (the “Rules”). 2. Term. Subject to termination pursuant to Paragraph 9, the term of this Agreement shall begin as of October 1, 2014 and shall terminate on September 30, 2017; provided however, that this agreement shall be renewable for two additional one year periods at mutually agreeable terms. 3. Fund for Payment of Claims. The Client has the sole obligation and responsibility for funding the payment of claims made by its employees under the Law and Rules. The Service Agent assumes no duty to fund any such claims at any time and shall have no obligation to advance funds for any such payment. The Client agrees to maintain all necessary funds for payment of claims in accordance with the Law and Rules and to inform the Service Agent of all relevant details with respect to any such accounts in order for the Service Agent to perform its duties under this Agreement. The Client shall add to or increase the amount in any such accounts as needed, and, in any event, within five (5) business days from the Service Agent’s notice to the Client to such effect. 4, Allocated Claims Expenses. Charges for services below are billed at negotiated rates for vendors selected by CLIENT/SERVICE AGENT unless otherwise outlined below. “Allocated Claims Expenses” shall be defined as expenses arising in connection with the settlement of claims, which shall be defined as expenses directly allocated to a particular claim to be discharged from the accounts funded by the CLIENT specified in Paragraph 3, including, but not limited to: a. Attorneys’ and legal assistants’ fees for claim and any lawsuits, before and at trial, on appeal, or otherwise; Court and other litigation and settlement expenses, including, without limitation: (i) Medical examinations to determine extent of liability; (ii) Expert medical and other testimony; (iii) Laboratory, X-ray and other diagnostic tests; (iv) Autopsy, surgical reviews, and other pathology services; (v) Physician and related fees and expenses in reading, interpreting, or performing any of the foregoing tests or services; (vi) Stenographer, process server, and other related trial preparation, trial, settlement, and court costs; (vii) | Witnesses fees and expenses before and at trial, deposition, settlement discussions, or otherwise; and Fees and expenses for surveillance, private investigators, or otherwise, Fees for the indexing of injured employees, Fees for any work done outside the office, including, but not limited to, field investigations necessary to determine compensability, liability, Special Disability Trust Fund or subrogation recoverability, claimant control, attendance at mediations, hearings and depositions, attendance at medical consultations or hearings, appraisals, medical management, case management and recorded statements, Telephonic medical management services are available for selected cases at a rate of $725.00 per claim for the life of the contract or closing of the case. Any other medical management services, such as assisting with the development of preferred medical providers, education and training of providers or supervisory staff, and providing education reference material would be billed on a time and expense basis at the rate of $75.00 per hour. Other medical management services, available through the Service Agent or other outside provider; including but not limited to; onsite case management, peer reviews, medical and/or hospital bill audits, and pre- certifications will be billed at the rates applicable at the time of billing. Fees for over-night or special mail service for various documents, i. Provider Bill Review/Cost Containment Services — Service Agent will review all medical bills and make appropriate reductions as required by Florida Statute 440. Fees for these services are $5.95 per bill and 30% of all savings over and above Fee Schedule savings, and 35% out-of-network and hospital audits. j. Photocopying and/or CD-ROM copies, review of relevant documentation. k. Medicare Set-Aside (MSA) services to include; recommendation for MSA submission, MSA cost projection, MSA submission, liability MSA services, comprehensive drug utilization review, lien search, conditional lien dispute, projection update. Compensation for the Service Agent: For performing its services under this Agreement, the Service Agent shall be entitled to the following compensation: a. Fees for workers’ compensation and liability claims handling for the Employer for exposures whose dates of loss fall between October 1, 2014 and September 30, 2016 will be a minimum and deposit of $62,000.00, per year. This minimum and deposit will be billed on a quarterly basis, with the first payment due on October 1, 2014. b. Fees for workers’ compensation and liability claims handling for the Employer for exposures whose dates of loss fall between October 1, 2016 and September 30, 2017 will be an annual minimum and deposit of $63,860.00, per year. This minimum and deposit will be billed on a quarterly basis, with the first payment due on October 1, 2016. C. The minimum and deposit of each of the above policy periods are based upon the following rates listed below: Workers’ Comp Medical only, per claim S 197.00 per exposure Workers’ Comp Lost Time, per claim S 1,200.00 per exposure Auto Liability Bodily Injury, per claim S 695.00 per exposure Auto Liability Property Damage, per claim S 480.00 per exposure Physical Damage, per claim S 275.00 per exposure Property Buildings / Structures, per claim S 480.00 per exposure Property Contents, per claim S 480.00 per exposure Property BI/Extra Expense, per claim S 565.00 per exposure Property Other (specify), per claim S 480.00 per exposure General Liability Bodily Injury, per claim S 735.00 per exposure General Liability Property Damage, per claim $ 480.00 per exposure Errors & Omissions Liability, per claim S 970.00 per exposure Other Liability (Specify), per claim S 970.00 per exposure Other Claims (Specify), per claim S 970.00 per exposure Incident Only Reports, each S 26.00 per exposure Data Capture/Check Issuance, per exposure $ 50.00 per exposure The above rates will be a one-time charge for the life of the contract. The above fees cover all claims management/administration and data processing services. All years are subject to audit. d. Fees for any field investigation will be $95.00 per hour, $0.55 per mile and $1.00 per color photograph. Fees for tield work for first party property claims will be billed per the fee schedule in effect at the time of the loss. Mileage charges will be incurred only for time and travel occurring within Employer’s boundaries. There will be no charge for travel time to or from Employer. Attendance at four mediations, per year, will be provided without additional charge. e, If a catastrophe occurs, there will be numerous exposures under one occurrence. We will limit our office-based claims handling for any catastrophe causing multiple exposure occurrences to 10 exposures. Each of the 10 exposures will be billed at $480.00 per exposure. For example, assuming all exposures were either property building or property contents, office based adjusting fees for a catastrophe occurrence generating 10 or more exposures would be $4,800.00. All fieldwork charges would be based on the schedule in effect at the time of the Catastrophe. f. Information Services — Optional programs available. If selected by Employer, Service Agent will bill accordingly. e Online NOI (Pre-fill) $1,000.00 per year e Adhoc Report Library $1,500.00 Setup Fee (one time charge) $250.00 per login & password (per year) e Adhoc Query Studio $1,500.00 Setup Fee (one time charge) $400.00 per login & password (per year) Excess Reporting Obligation - Unless otherwise specified in this Agreement, Service Agent agrees that reporting claims to excess insurance carrier is the Service Agent’s responsibility. It is the responsibility of the Client to provide accurate coverage information regarding any insurance policies insuring claims covered by this contract. New insurance information on renewal years will be made within 90 days of renewal date. Excess information will include name and claims reporting address and phone number of all carriers, policy number, effective dates, limits of liability, deductibles, specific retentions and loss funds. Actual policies will be provided. This information is required for each claim year that the Service Agent is handling for the Client. If this information is not made available as outlined in this Paragraph, Service Agent will not be responsible for any penalties, interest, or reductions in excess recoveries because of late reporting. The Service Agent shall not be responsible for costs, judgments’, settlements, damages, etc. resulting from the excess carrier’s denial of a claim due to untimely reporting at the fault of the prior administrator(s) for claims assumed under the current contract. Continuing Handling of Claims After Termination of Contract or Legally Imposed Mandates. Upon termination of this Agreement as set forth in paragraph 9, the Service Agent agrees to continue handling all claims that have been made and reported to it prior to such date of termination for thirty (30) days unless the parties have agreed otherwise in writing. Upon repeal of any service mandated by the workers’ compensation law and/or other applicable statutes and/or regulations, the Service Agent agrees to continue handling all claims under the repealed service that have been reported to it prior to the date of such repeal for thirty (30) days unless the parties have agreed otherwise in writing. 10. 11. 12. Upon exiting, client data will be provided to the new TPA either by a series of attachments to one or more email messages containing zip files which can be password-protected or via CD ROMS. The claim files may exist as paper files and will be shipped as such. If the claim files are stored as images in a document retrieval system, they will be provided via CD ROM or the most current means of providing data. The cost for this will be no greater than $3,500.00. The Client will be billed for any additional programming to help in data transfer. Disputes Subject to Arbitration. Any dispute or claim arising out of or relating to this Agreement or any breach thereof shall be resolved by submission of such dispute or claim to an arbitration panel composed as follows: The Client and the Service Agent shall each select one member of the panel and the two selected members shall select a third member. The parties agree to follow the rules of the American Arbitration Association. Termination. This Agreement may be terminated by either the Client or the Service Agent by giving prior written notice of ninety (90) days. In the event of such termination, compensation paid or payable to Service Agent under Paragraph 5 shall be prorated as appropriate. Notwithstanding anything in this Paragraph 9 to the contrary, the insolvency or filing for relief from creditors of any party pursuant to the United States Bankruptcy Code or the material breach of a material provision of this Agreement by any party shall permit the other party to cancel this Agreement immediately upon written notice. Covenants of the Service Agent and the Client. Each of the Service Agent and the Client agrees to use its normal and ordinary professional care and diligence in the performance of its duties under this Agreement and will use its best efforts to comply at all times with the Law and the Rules. Indemnification. Each party agrees to indemnify and hold harmless the other and its directors, officers, employees, stockholders, and agents against any and all claims, lawsuits, settlements, judgments, costs, penalties, and expenses, including, without limitation, attorneys’ and legal assistants’ fees before and at trial, on appeal, or otherwise, resulting from the breach of, or negligence or misconduct in performing, any provision of this Agreement, by such party or by its directors, officers, employees, stockholders or agents, whether acting alone or in collusion with others. Compliance with Florida Statute 119.071. The Service Agent shall comply with all the provisions of section 119.071, Florida Statutes relating to the public records which requires, among other things, that the Service Agent: a. Keep and maintain public records. b. Provide the public with access to public records on the same terms and conditions that the public agency would provide the records. C. Ensure that public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law. d. Meet all requirements for retaining public records and transfer, at no cost, to the public agency all public records in possession upon termination of the contract. 13. Miscellaneous. Each party represents and warrants that it has full power and authority to enter into this Agreement. All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when received if personally delivered; when transmitted if transmitted by telecopy, electronic telephone line facsimile transmission, or other similar electronic or digital transmission method; the day after it is sent, if sent by recognized expedited delivery service; and five (5) days after it is sent, if mailed, certified or registered mail, return receipt requested, postage prepaid. In each case, notice shall be sent to: If to the Client: Okaloosa County BOCC 601 A North Pearl Street, Ste 204 Crestview, FL 32536 If to the Service Agent: Johns Eastern Company, Inc. Post Office Box 110259 Lakewood Ranch, FL 34211-0004 or to such other address as either party may have specified in writing to the other using the procedures specified above in this Paragraph. (i) This Agreement shall be construed pursuant to and governed by the substantive laws of the State of Florida (and any provision of Florida law shall not apply if the law of a state or jurisdiction other than Florida would otherwise apply). (ii) The headings of the various Paragraphs in this Agreement are inserted for the convenience of the parties and shall not affect the meaning, construction, or interpretation of this Agreement. (iii) Any provision of this Agreement which is determined by a court of competent jurisdiction to be prohibited, unenforceable or not authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability or non-authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality of such provision in any other jurisdiction. In any such case, such determination shall not affect any other provision of this Agreement, and the remaining provisions of this Agreement shall remain in full force and effect. If any provision or term of this Agreement is susceptible to two or more constructions or interpretations, one or more of which would render the provision or term void or unenforceable, the parties agree that a construction or interpretation which renders the term or provision valid shall be favored. This Agreement constitutes the entire Agreement, and supersedes all prior agreements and understandings, oral and written among the parties to this Agreement with respect to the subject matter hereof. (i) if, within ten (10) days after demand to comply with the obligations of one of the parties to this Agreement served in writing on the other, compliance or reasonable assurance of compliance is not forthcoming, and the other party takes steps to enforce rights under this Agreement pursuant to Paragraph 9 or otherwise, the prevailing party in any action shall be entitled to recover all reasonable costs and expenses (including reasonable attorneys’ and legal assistants’ fees before and at trial, on appeal, or otherwise.) (ii) If any monies shall be due either of the parties to this Agreement hereunder and shall not be paid within forty-five (45) days from the due date of such payment, interest shall accrue on such unpaid amount at the rate of 1% per month in accordance with the Florida Prompt Payment Act - F.$.218.70-79. This Agreement shall be binding upon and inure to the benefit of the successors in interest and assigns of the parties. The parties to this Agreement will execute and deliver, or cause to be executed and delivered, such additional or further documents, agreements, or instruments and shall cooperate with one another in all respects for the purpose of carrying out the transactions contemplated by this Agreement. This Agreement may be executed in any number of counterparts, each of which shall be considered an original, but all of which together shall constitute one and the same instrument and shall become effective when each of the parties has executed at least one of the counterparts even if all the parties have not executed the same counterpart. IN WITNESS WHEREOF, the SERVICE AGENT and the EMPLOYER have each caused this Addendum to be executed by its duly authorized representative to be effective the 1st day of October 2014. WITNESSES: OKALOOSA COUNTY BOARD OF COUNTY COMMISSIONERS WITNESSES: Charles K. Windes, Jr., Chairman J A. S EASTERN COMPANY, INC. C) Shephew 0 Vere Bevprly Adkigé, AIC, AIM ecutive Vice President Special Account Services Integrity. Exnerionce. Results SERVICE FEES - OKALOOSA COUNTY BOCC CATASTROPHE FEE SCHEDULE - ANY NAMED STORM Full Repair Cost Service Fee $ 0.01 - $2,500.00 $395.00 2,500.01 - 5,000.00 $495.00 5,000.01 - 7,500.00 $585.00 7,500.01 - 10,000.00 $695.00 10,000.01 - 15,000.00 $885.00 15,000.01 - 20,000.00 $1,025.00 20,000.01 - 25,000.00 4.5% of Loss - $1,025 minimum 25,000.01 - 35,000.00 4% of Loss - $1,200 minimum 35,000.01 - 50,000.00 3.5% of Loss - $1,400 minimum 50,000.01 - 100,000.00 3% of Loss - $1,750 minimum Over 100,000.00 Time & Expense 1. Full Repair Cost - Agreed cost to repair or replace before applying depreciation, deductible, or other clauses limiting coverage. 2. In addition to the schedule, the following charges will be made: a. All miles driven at $0.55 per mile. b. Photo - $1.00 each c. Outside fees, reports, telephone, and other direct expense, at cost. d. Administrative/Set up fee - $50.00 e. Drive time charged and mileage (both prorated when possible) when loss is more than 20 miles from our base of operation. f. Denials charged at Time & Expense g. Time & Expense Rates are $85.00 per hour for Adjusters and $125.00 per hour for General Adjusters and Executive General Adjusters 69 JOHNS EASTERN COMPANY, INC. _ /~ SERVICE FEES - OKALOOSA COUNTY BOCC PROPERTY FEE SCHEDULE - ANY NON-CAT 1ST PARTY PROPERTY CLAIM FULL REPAIR COST FULL ADJUSTMENT $ 0.01 - $500.00 $225.00 $ 500.01 - 1,000.00 $256.00 $ =©1,000.01 - 2,500.00 $379.00 $ ©=©2,500.01 - 5,000.00 $465.00 $ 5,000.01 - 7,500.00 $559.00 $ =©7,500.01 - 10,000.00 $669.00 $ 10,000.01 - 15,000.00 $825.00 $ 15,000.01 - 20,000.00 $980.00 $ 20,000.01 - 30,000.00 4.5% of Loss - $ 995 minimum $ 30,000.01 - 40,000.00 3.5% of Loss - $1,350 minimum $ 40,000.01 - 55,000.00 3.0% of Loss - $1,400 minimum $ 55,000.01 - 70,000.00 2.5% of Loss - $1,650 minimum $ 70,000.01 - 90,000.00 2.0% of Loss - $1,750 minimum $ 90,000.01 - 100,000.00 2.0% of Loss - $1,800 minimum $ 100,000.01 - Billed at Time and Expense 1. Above fees include local telephone, file creation, copying, and secretarial support. 2. Full Repair Cost - Agreed cost to repair or replace before applying depreciation, deductible, or other clauses limiting coverage. 3. In addition to the schedule, the following charges will be made: a. All miles driven at $0.55 per mile. b. Photos - $1.00 each c. Outside fees, reports, telephone, and other direct expense, at cost. 4, These schedules do not apply to catastrophes. 5. All Denials will be handled at Time and Expense. 6. Subrogation efforts charged at Time and Expense. 7. Hourly Rate: Adjuster at $75.00 per hour + 20% Administrative Expense Executive General Adjuster: $135.00 per hour General Adjuster: $125.00 per hour Managers: $125.00 per hour 70 JOHNS EASTERN COMPANY, INC. _e=