HomeMy WebLinkAbout54-96 RESOLUTIONRESOLUTION NO. 54-96
A RESOLUTION TO EXERCISE THE CITY OF
FAYETTEVILLE'S OPTION TO RENEW BLUE CROSS/BLUE
SHIELD GROUP PLANS FOR POLICY YEAR MAY 1, 1996
THROUGH APRIL 30, 1997; AND RECOGNIZING AND
APPROVE THE ADDITIONAL PREMIUM REQUESTED BY
BLUE CROSS/BLUE SHIELD.
1
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1. The City Council hereby authorizes staff to exercise the City's option to
revew Blue Cross/Blue Shield Group Plans for policy year May 1, 1996 through Apnl 30, 1997;
and recognizes and approves the additional premium requested by Blue Cross/Blue Shield. The
City's contribution for the contract year will to be approximately $756,000. A copy of the
contract is attached hereto marked Exhibit "A" and made a part hereof.
PASSED AND APPROVED this 16th day of Apnl , 1996.
- tat c 01E1'14.
By:
Traci Paul, City Clerk
APPROVED:
By:
Fred Hanna, Mayor
•
USAble Life
•
LONG TERM DISABILITY RENEWAL
Policyholder: City of Fayetteville LTD Policy #: 2467-100
Renewal Date: 5/1/96 Date Prepared: 3/4/96
Representative: Dave Ferguson
Amount of Benefit: 60% of basic monthly earnings not to exceed 56,000
Current Rates Per $100 of Covered Payroll:
Your New Rates Per $100 of Covered Payroll:
Monthly Covered•Payroll.
• Your New Premium:
46.
.46
$954,080.00
54,388.77
Remarks:
PLEASE COMPLETE THE FOLLOWING INFORMATION
Percentage of Company Contribution:
Number of Eligible Employees:
Representatives Signature:
Administrators Signature:
AA ct ye) r
Title
Date: —
Date: g-/6 -
Your Group Policy contains special provisions which were requested at the date of issue. Please check your Policy
carefully. 11 you have questions, please contact your Sales Representative or USAble Life.
UND-RNF(1-96)
•
USAble Life
Employer Certification of
Enrollment & Eligibility
We have reviewed the enrollment for our group plan and our employee records. We certify that:
• Our contribution is: Life & ADSED - % STD -
IMPORTANT NOTE: If Employer Contribution is 100%, all eligible employees must be enrolled. If employees are
required to pay any part of the premium, employees enrolling more than 31 days after completing their waiting
period will be required to furnish Evidence of Insurability.
• There are
employees eligible to participate in the plan and are enrolled.
• All persons enrolled in the plan are:
members of an eligible class of employees;
are actively at work at least hours per week, are actively working at their
normal place of employment, working in our regular business and are not in a
hospital, nursing home, convalescent facility, or are not convalescing from illness
or injury at home, and
13 are directly compensated by us for their services.
EXCEPTIONS:
For any person enrolled not meeting the above requirement, the following information is provided:
NAME
DATE LAST WORKED REASON FOR EXCEPTION
Representative's Signature Date 5-- /— ci 40
Administrator's Signature
UND-RNI? (12-93) srm
M a VO c
(Title)
Date Y-16
YOU'LL CHOOSE US FOR LIFE
P.O Box 1650
Little Rock, Arkansas 72203-1650
(501) 375-7200
II:Wile Life is Ruled A (Errellen() 4 the Aft. Best Company
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• 1
•
ARKANSAS BLUE CROSS AND BLUE SHIELD
A MUTUAL INSURANCE COMPANY
RETENTION AND LIABILITY AGREEMENT FOR
CITY OF FAYETTEVILLE AND FAYETTEVILLE PUBLIC LIBRARY
Group Numbers: 090041 and 090042
This Retention Agreement applies to the above groups.
The Agreement is a retrospective refund calculation, and will be determined using earned
premiums and incurred claims of Blue Cross, Blue Shield, and Extended Benefits coverage. The
effective date of the Agreement is to be May 1, 1996. Each policy year constitutes a period for
accountability of premiums and incurred claims, and hereafter will be referred to as a refund period.
The refund settlement will be calculated one hundred and eighty (180) days after the end of each
policy year.
The composition of the formula used to determine the refund amount and the definition of each
item contained in the formula are as follows:
Fir IGEF3TI,ITY FOR COVERAGE UNDER THE GROUP: In addition to any other eligibility
requirements, group members must work at least 40 hours per week in order to be eligible for
coverage under the above named groups.
EARNED PREMIUM: Blue Cross, Blue Shield, and Extended Benefits income for the refund
period.
RETENTION: The amount retained by Arkansas Blue Cross and Blue Shield for claims
administration expense, general administration expenses, general contingency, insurance risk, and
large claim pool. The retention used in establishing the refund amount is 18.8% of earned premium.
CLAIMS COST: Claims cost is the amount of earned premium required to pay policy benefits for
claims incurred during the refund period. Provided, however, that large claim adjustments shall be
based on those amounts actually paid per covered person during the term of the Agreement, whether
those paid amounts were incurred before or during the term of the agreement. See Paragraph
LARGE CLAIM ADJUSTMENT.
LARGE CLAIM ADJUSTMENT. The Large Claim Pool base agreed to by the Carrier and the
Group is $50,000 per covered person per policy year. At the time of the refund settlement, only the
$50,000 per covered person per policy year will be applied toward the determination of the
Retrospective Refund and Stabilization Reserve Fund
RATE STABILIZATION RFSERVF• The amount of earned premium maintained in reserve for
the Group by Arkansas Blue Cross and Blue Shield to offset unusual fluctuations in claims. This will
be 13.4% of earned premium for the policy year beginning May 1, 1996. Once the reserve is
established, it will be credited with interest earned during subsequent periods. If an underwriting loss
is incurred during the refund period, it will be charged against the rate stabilization funds. Negative
balances in the rate stabilization fund will be carried forward to the next refund period.
REFUND: The retrospective refund shall be earned premium less retention, minus claims cost
less large claim adjustment, minus the adjustment to the stabilization fund. The formula is illustrated
as follows:
(EARNED PREMIUM - RETENTION) - (CLAIMS COST - LARGE CLAIM ADJUSTMENT) -
ADJUSTMENT TO STABILIZATION FUND = REFUND
The refund shall be paid to the City of Fayetteville and Fayetteville Public Library.
TERMINATION: In the event the Group terminates Blue Cross and Blue Shield coverage during
the policy year, any refund or rate stabilization reserve due the Group will be considered liquidated
4.
•
damages. If the termination occurs at the end of a policy year, any refund of rate stabilization reserve
due the Group will not be settled until twelve (12) months following the group's termination.
This Agreement may be terminated by either the Policy Holder or the Plan at the end of the policy
year by giving thirty (30) days prior notice in writing. The policy year for this agreement is actually
eight months (May 1, 1996 through December 31, 1996).
ARKANSAS BLUE CROSS AND BLUE SHIELD, A MUTUAL INSURANCE COMPANY
Signed: Date:
CITY OF FAYETTEVILLE AND FAYETTEVILLE PUBLIC LIBRARY
Sign
c(if 1/74
-
Date:
•
•
•
Arkansas
BlueCross BlueShield
An Independent Licensee of the Blue Cross and Blue Shield Association
ARKANSAS BLUE CROSS AND BLUE SHIELD
A Mutual Insurance Company
601 Gaines Street
P.O. Box 2181
Little Rock, Arkansas 72203
GROUP POLICY
We agree to provide to the eligible employees of the policyholder, and their covered
dependents, the benefits set forth in the Benefit Certificate(s), attached to and
incorporated as part of this policy in accordance with the terms, provisions and
limitations of this policy.
This policy is issued in consideration of the policyholder's application, a copy of
which is attached, the policyholder's covenants and the policyholders payment of
the premium.
This policy becomes effective at 12:01 a.m. on the effective date shown on the
Schedule page. The premium for the policy may be adjusted upon thirty (30) days'
notice The policy is subject to termination according to its terms
The following pages, including the Benefit Certificate(s), the application and any
nders, endorsements or amendments are part of this policy.
It is signed at our Home Office on the effective date.
GMC -1 6/95
Presid nt
GROUP INSURANCE POLICY
1
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TABLE OF CONTENTS
CLAIMS
COVENANTS OF THE POLICYHOLDER
DEFINITIONS
GENERAL PROVISIONS
POLICY PROVISIONS RELATIVE TO MEMBERSHIP,
MEETINGS AND VOTING
PROVISIONS RELATING TO PERSONAL
AND DEPENDENT INSURANCE
SCHEDULE
GMC -1 6/95 2
PAGE
15
6
4
17
20
8
3
• SCHEDULE •
•
Policyholder: City of Fayetteville
Fayetteville Public Library
Group Policy Number: 090041 & 090042
Effective Date: June 1, 1996
Contract Term: June 1, 1996 - December 31, 1996
Premium Due Date: June 1, 1996
Policy Month: 1st to last day of month
Premium: Monthly premium per covered employee as follows:
Medical Dental
Employee $116.61 $14.26
Family Coverage $282.41 $49.97
The initial premium is due on the Premium Due Date, and no coverage shall be in effect until such
payment is received by the company. Subsequent premiums are payable on or before the same day
as the Premium Due Date of each month thereafter.
Eligibility Period [30 days]
Employee Classes [One class]
Minimum Number of employees insured: 2
Non-contributory
Number of eligible employees
Two to five percent
Six and more
Minimum Percentage of
dependent participation
Contributory
Minimum percentage of Minimum percentage of
employee participation' employee participation'
One Hundred (100%) percent One Hundred (100%) percent
One Hundred (100%) percent Seventy-five (75%) percent
One Hundred (100%) percent
of insured employees with
eligible dependents2
Seventy-five (75%) percent
of insured employees with
eligible dependents2
'Employees covered under a group medical plan elsewhere may be excluded in the calculation of the minimum percentage of
participation; however, in no case will the minimum percentage of employee participation including employees having other coverage
be less than fifty five (55%) percent of eligible employees.
2Dependents covered under a group medical plan elsewhere may be excluded in the calculation of the minimum percentage of
participation; however, in no case will the minimum percentage of dependent participation including dependents having other
coverage be less than fifty five (55%) percent of insured employees with eligible dependents.
GMC Sch. 1 (6/95)
3
DEFINITIONS
Active Work or Actively at Work means an employee reports for work at his usual
place of employment and is able to perform all the duties of his regular occupation
for the entire normal work day. An employee shall be deemed actively at work on
each day of a regular paid vacation, or on a regular non -working day on which he is
not disabled, provided he was actively at work on the last preceding regular working
day.
Child means an employee's natural child, legally adopted child, a stepchild or foster
child who is dependent upon the employee for his main support and care. "Child"
also means a child for whom the employee filed a petition for adoption if coverage
for such is applied for within 60 days of filing such petition. "Child" also means a
child for whom the employer must provide medical support under a qualified medical
child support order.
Company means Arkansas Blue Cross and Blue Shield, A Mutual Insurance
Company
Contributory insurance means insurance for which the employee must apply and
agree to make the required premium contributions.
Covered Person means an employee or dependent who is insured under this
policy.
Dependent means only the following persons who are not otherwise eligible as
employees*
a. an employee's spouse;
b. an employee's unmamed child less than 19 years of age;
c. an employee's unmarried child age 19 but less than age 231 who is:
(1) not working on a full-time basis; and
(2) is a full-time student in an accredited school; or
d. an employee's unmarried child who is incapable of self support
because of mental retardation or severe physical handicap, provided
such child is under age 19 on the employee's effective date.
Dependent Insurance means insurance on the dependent of an employee.
Eligibility Date means:
a the policy effective date for an employee working for the employer on
that date;
b. the ending date of his eligibility period for any other employee hired
after the policy effective date.
Eligibility Period means the time beginning with the employee's most recent date of
continuous employment with the employer and ending on the date he is eligible for
insurance.
GMC -1 6/95 4
Employed on a part-time basis means that the employment of a person results in
his active expenditure of less than thirty hours per week. Such person employed on
a part-time basis is not eligible for insurance.
Employee means a person who ise
a. directly employed in the normal business of the employer; and
b. paid for services by the employer; and
c. actively at work for the employer, or any subsidiary or affiliate covered
under this policy
No director or officer of the employer shall be considered an employee unless he
meets the above conditions.
Employer means the policyholder.
Foster Child means a child who is related to an employee by blood or marriage or a
child for whom an employee has assumed a legal duty, provided:
a. such child normally lives with the employee in a parent-child
relationship; and
b. an employee has a legal right to claim such child as a dependent on
his federal income tax form.
Grace Period means the period of 31 consecutive days beginning with any premium
due date after the first which shall be allowed for payment of premium.
Non -Contributory Insurance means insurance for which the employee must apply
but does not have to make any premium contnbutions.
Personal Insurance means insurance on the employee.
Plan means the Employee Health Benefit Plan established by the employer. The
terms of the Plan are set forth in this policy.
Plan Administrator means the employer.
Policy means this policy.
Policyholder means the entity as shown in the Schedule.
Policy Month means a month commencing on the first day of the calendar month
and expiring on the last day of the calendar month or commencing on the fifteenth
day of the month and expiring on the fourteenth day of the following month,
depending upon the billing cycle applied by the company. The policy month is set
out in the Schedule.
GMC -1 6/95 5
COVENANTS OF THE POLICYHOLDER
As part of the consideration for this policy, policyholder understands, acknowledges
and agrees:
Plan Administrator
The policyholder is the Plan Administrator of the Employee Health Benefit Plan, the
terms of which are set forth in this policy. The policyholder gives the company
authority and full discretion to audit policyholder's records relating to this policy and
to determine all questions ansing in connection with insurance benefits, including but
not limited to eligibility, interpretation of Plan language, and findings of fact with
regard to any such questions. The actions, determinations and interpretations of the
company acting on behalf of the Plan within the scope of this authonty shall be
conclusive and binding on the policyholder and the covered person.
Employee and Dependent Eligibility.
The policyholder shall accurately report employee and dependent eligibility
information to the company. Failure of the policyholder to provide timely notice
to the company of a change in the eligibility status of an employee or
dependent shall result in the policyholder being liable to the company for any
claims paid in error to such employee or dependent by the company.
Employee Participation
This policy may be terminated by the company if the percentage of eligible
employees of policyholder covered by the policy becomes less than the percentage
of employee participation specified in the Schedule, or if the number of insured
employees falls below the minimum number of insured employees specified in the
Schedule.
Dependent Participation
This policy may be terminated by the company if the percentage of eligible
dependents of eligible employees of policyholder covered by the policy becomes
less than the percentage of dependent participation specified in the Schedule.
Payment of Premium
The policyholder shall pay the company the premiums for covered employees and
dependents every month, in advance.
COBRA
If COBRA applies to the Plan, the policyholder, as Plan Administrator, must provide
its employees and their dependents notice of COBRA rights at the time their
coverage commences under this policy and must notify the employee or dependent
of his nght to elect continuation of coverage under COBRA within fourteen (14) days
of the happening of a "qualifying event" under COBRA. The company shall not
assume the policyholder's obligation to provide benefits under COBRA If the
policyholder fails to provide these notices at the times specified in this policy,
nor shall the company be responsible for providing any COBRA notices to
employees or dependents.
GMC -1 6/95 6
.4
•
Agent for Employees
The policyholder is the agent for its employees and their dependents in all dealings
between employees or dependents and the company, including.
1. payment of premiums to the company;
2. notifying the company of changes in employee or dependent status;
3. secunng and forwarding to the company applications for coverage of new
employees or new dependents;
4. providing employees and dependents all communications and notices from
the company.
Contract with Arkansas Blue Cross and Blue Shield
On behalf of policyholder and its employees, the policyholder acknowledges its
understanding that this policy constitutes a contract solely between the policyholder
and Arkansas Blue Cross and Blue Shield, that Arkansas Blue Cross and Blue
Shield is an independent corporation operating under a license with the Blue Cross
and Blue Shield Association, an association of independent Blue Cross and Blue
Shield Plans, (the "Association") permitting Arkansas Blue Cross and Blue Shield to
use the Blue Cross and Blue Shield Service Marks in the State of Arkansas, and that
Arkansas Blue Cross and Blue Shield is not contracting as the agent of the
Association The policyholder further acknowledges and agrees that it has not
entered into this policy based upon representations by any person other than
Arkansas Blue Cross and Blue Shield and that no person, entity, or organization
other than Arkanas Blue Cross and Blue Shield shall be held accountable or liable
to policyholder for any of the obligations created under this policy.
GMC -1 6/95 7
•
PROVISIONS RELATING TO PERSONAL AND DEPENDENT INSURANCE
Individual Eligibility Date
Employees who work on a full-time basis for the employer are eligible for insurance
after completion of the required eligibility period, provided they are in a class of
employees who are included in the Plan and set out in the Schedule Employees
shall be considered to work on a full-time basis if they customarily work at least 30
hours per week.
An employee shall become eligible for insurance on the latest of the following dates:
1) the effective date of this policy;
2) the end of the specified eligibility period;
3) the date this policy is changed to include the employee's class; or
4) the date the employee becomes a member of a class eligible for insurance.
Effective Date of Personal Insurance
If an employee is not actively working on the date his insurance is scheduled to take
effect, it shall take effect on the day he returns to active work. If the employee's
insurance is scheduled to take effect on a non -working day, his active work status
shall be based on the last working day before the scheduled effective date of his
insurance.
An employee must use forms provided by the company when applying for insurance.
The employee's insurance shall be effective 12:01 a.m.:
1) if it is non-contnbutory, on the first day of the policy month following the date
the employee becomes eligible for coverage; or
2) if it is contributory and the employee makes application within 31 days after
the date he first became eligible, on the first day of the policy month following
his eligibility date.
An employee applying for contributory insurance must furnish evidence of insurability
at his expense if.
1) he does not apply for insurance within 31 days after the date he first became
eligible, or
2) he has previously terminated his insurance while in an eligible class.
Such employee's insurance coverage is subject to medical underwnting. The
effective date shall be the date the employee's application is approved by the
company.
Effective Date of Personal Insurance Upon Replacing Existing Group Policy
If this policy replaces a group policy consisting of more than fifteen (15) employees
within a penod of sixty (60) days from the date of discontinuance of the prior plan,
the employee's insurance shall be effective 12 01 a m on the effective date of this
policy for each employee who was validly covered under the previous plan on the
date of the discontinuance and is a member of the class(es) of employees eligible for
GMC -1 6/95 8
coverage under this policy. The policy's limitations or exclusions relating to "actively
at work" or hospital confinement shall not apply to these employees
Termination of Personal Insurance
Personal Insurance shall terminate at 12:00 midnight on the earliest of the following
dates:
1) the last day of the period for which a premium payment is made, if the next
payment is not made;
2) the date the employee becomes a member of the armed forces;
3) the date this policy terminates;
4) the date the employee ceases to be a member of a class eligible for
insurance; or
5) the date the employee ceases to be actively at work.
During any leave taken under the Family and Medical Leave Act, the employee shall
continue to have coverage under this policy on the same conditions as if he had
been actively at work during the entire leave period, provided premiums for
continuation of coverage are paid by or through the employer. Coverage shall
terminate on the date determined by 1 through 4 above, even if the employee has
nghts against his employer under the Family and Medical Leave Act.
Eligibility Date for Dependent Insurance
Dependents are eligible for insurance on the latest of the following dates:
1) the date the employee becomes eligible for dependent insurance;
2) the date a person becomes a dependent, or
3) the date this policy is amended to include the employee's class as being
eligible for dependent insurance.
The employee's spouse or child shall not be eligible for Dependent Insurance if they:
1) have Personal Insurance under this policy; or
2) are in active military service.
If both the employee and spouse are insured as employees, their eligible children
may be insured as dependents of only one of them.
Effective Date of Dependent Insurance Upon Replacing Existing Group Policy
If this policy replaces a group policy consisting of more than fifteen (15) employees
within a period of sixty (60) days from the date of discontinuance of the prior plan,
Dependent Insurance shall be effective 12:01 a.m. on the effective date of this policy
for each dependent who was validly covered under the previous plan on the date of
the discontinuance and is a dependent of an employee who is a member of the
class(es) of individuals eligible for coverage under this policy. The policy's
limitations or exclusions relating to "actively at work" or hospital confinement shall
not apply to these dependents.
Effective Date of Dependent insurance
Coverage for any Dependent who is over age 19 and confined as a bed patient in a
hospital on the date Dependent Insurance is scheduled to take effect shall not
GMC -1 6/95 9
become effective until the Dependent has recovered from the condition(s) causing
his hospital confinement.
An employee must use forms provided by the company when applying for dependent
insurance.
Dependents shall not be insured until the employee is insured.
Employees do not have to submit evidence of insurability on their dependents if they
apply for coverage within thirty-one (31) days after the dependent becomes eligible.
The Dependent Insurance shall be effective at 12:01 a.m.:
1) if it is non-contributory, on the date the dependent becomes eligible for
coverage regardless of when application was made; or
2) if it is contnbutory and the employee makes application within thirty-one (31)
days after the date he first became eligible, on the first day of the policy
month following his eligibility date.
An employee applying for contributory Dependent Insurance must furnish evidence
of the dependent's insurability at his own expense if:
1) he does not apply for Dependent Insurance within thirty-one (31) days
following the date the dependent first becomes eligible; or
2) he has previously terminated Dependent Insurance while in an eligible class.
Such Dependent Insurance coverage is subject to medical underwriting The
effective date is the first day of the policy month after the application is
approved by the company.
Addition of Eligible Dependents
New born child
If the insured employee or his spouse becomes pregnant, in order for his child to be
a covered person from the moment of birth, the child must be insured for dependent
coverage on the date he is born In order to have such coverage, the insured
employee or the policyholder must submit a change request to the company prior to
the date of delivery, however, in the event of a premature birth, such change request
may be submitted within fifteen days of the date of delivery Dependent insurance
premium shall be payable from the first day of the billing cycle in which the child is
bom.
Adoption
Dependent insurance may be extended to a dependent placed with the employee for
adoption or for whom the employee has filed a petition to adopt If a petition for
adoption has been filed, the coverage shall begin on the date of the filing of the
petition for adoption if the employee applies for coverage within sixty (60) days after
the filing of the petition for adoption. However, the coverage shall begin from the
moment of birth if the petition for adoption and application for coverage is filed within
sixty (60) days after the birth of the child. If the application for coverage was filed
more than sixty days after the petition for adoption, or if the application has been
GMC -1 6/95 10
•
filed as a result of the child being placed with the employee for adoption, coverage
shall begin on the date the application for dependent coverage is received by the
company. The coverage shall terminate upon the dismissal, denial, abandonment or
withdrawal of the adoption, whichever occurs first.
Medical Support Orders
Dependent insurance shall be extended, on the same bases as to other children, to
a child for whom the employee must provide medical support under a qualified
medical support order regardless of whether the child resides with the employee or
is claimed by the employee as an exemption for federal income tax purposes.
Termination of Dependent Insurance
Insurance on a dependent shall terminate at 12:00 midnight on the earliest of the
following dates:
1) the date he ceases to be a dependent as defined in the Definition section;
2) the date the employee ceases to be a member of a class eligible for
dependents insurance;
3) the date the employee's insurance under this policy terminates;
4) the last day of the period for which a required dependent's premium payment
is made, if the next payment is not made; or
5) the date this policy terminates.
Continuation of Insurance for a Handicapped Dependent Child
If a dependent is not capable of self-sustaining employment due to mental
retardation or physical handicap, his insurance shall not terminate at age 19. The
insurance shall continue as long as the child remains handicapped, unless coverage
terminates as described in the Termination of Dependent Insurance provision above,
if the employee gives the company proof that the child is:
1) incapable of self-sustaining employment; and
2) chiefly dependent on the employee for support and maintenance.
The employee must give the company written proof after the child reaches age 19
and at any time after as the company may require. The company shall not require
proof more than once a year after the two year period following the date the child
reaches age 19.
Continuation Privileges
A covered person whose employment terminates or dependency status changes
shall have the right to elect continuation of coverage under the Policy as outlined
below. In order to be eligible for this option, the covered person must
1. have been continuously covered under the Policy for at least three (3)
consecutive months pnor to employment termination or change in
dependency status, and
2, make the election by notifying the policyholder [employer] or the
company in writing no later than ten (10) days after the employment
termination or change in dependency status.
GMC -1 6/95 11
Continuation shall terminate on the earliest of:
1. One hundred twenty (120) days after the date the election is made;
2. the date the covered person fails to make any premium payments or
the policyholder fails to pay the premium to the company;
3. the date on which the covered person is or could be covered by
Medicare;
4. the date on which the covered person is covered for similar benefits
under another group or individual policy;
5. the date on which the covered person is eligible for similar benefits
under another group plan;
6. the date on which similar benefits are provided for or available to the
covered person under any state or federal law;
7. the date on which the policy terminates.
Any covered person qualifying for continuation of coverage may elect a converted
policy instead of such continuation of group insurance. If the covered person has
elected continuation under this provision, he shall have the option of a conversion
coverage at the end of the maximum continuation period.
FEDERAL RIGHTS
Continuation of Benefits
If Section 10001 of the Consolidated Omnibus Budget Reconciliation Act of 1985
(COBRA) applies to the employer, the coverage of an employee or dependent
whose insurance ends due to a Qualifying Event may be continued while the policy
remains in force subject to the terms of this section and all terms and provisions of
the Group policy not inconsistent with this section.
This provision shall not be interpreted to grant to any covered person any
continuation rights under this policy in excess of those required by COBRA. If the
policyholder fails to comply with the provisions of this policy concerning COBRA or
the notice requirements or other standards under COBRA, the company shall not
assume the policyholder's obligation to provide COBRA continued coverage under
the Plan.
Qualifying Events
The following is a list of events which could result in termination of a covered
person's insurance under the Group Policy. If such should occur, for purposes of
this section, the event shall be called a Qualifying Event.
) An employee's death
2) Termination of employment (other than by reason of an employee's gross
misconduct), or of an employee's eligibility due to reduction in the employee's
hours.
3) An employee divorcing or becoming legally separated from his spouse.
4) An employee becoming eligible for Medicare.
5) A dependent child ceasing to be a dependent child as defined in the Group
Policy.
GMC -1 6/95 12
Requirements for COBRA Continuation
Continuation under this section is subject to a covered person requesting it and
paying any required premium contributions to the policyholder within his election
period.
The policyholder, as Plan Administrator, must have provided the covered person an
initial notice of COBRA rights at the time coverage commenced under the Plan (this
policy); and the Plan Administrator must notify the person qualified to elect
continuation of coverage under COBRA ("Qualified Insured") of his right to elect
coverage within fourteen (14) days of the happening of any of the qualifying events
listed above. The covered person must notify the Plan Administrator within 60 days
of the happening of qualifying event (3) or (5) above.
The Qualified Insured must elect to continue the group insurance within sixty (60)
days of the later of:
(a) the date the notification of election rights is sent, or
(b) the date benefits under the Plan terminate.
Otherwise it shall end on the date sixty (60) days following the date his insurance
terminated.
If an employee with Dependent Insurance requests continuation of coverage under
this section, such request shall include the Dependent Insurance, unless the
employee asks that it be dropped. In like manner, such a request on the part of the
insured spouse of an employee shall include coverage for all dependents of the
employee who were insured.
Insurance Continued
The benefit continued for a covered person in accordance with this section shall be
the same as otherwise provided under the Group Policy for other covered persons in
the same benefit class in which such covered person would have been insured had
his insurance not, except for this section, terminated. As such, the coverage shall be
subject to the Group Policy affecting the benefits of such class following the
Qualifying Event.
In no case shall the coverage continued under this section include insurance to
which this section does not apply.
Termination
Coverage being continued for a covered person under this section shall terminate on
the earliest of the following applicable dates:
1) The date the Group Policy terminates or is amended to terminate the
insurance of the particular section of the Group Policy under which the
coverage is provided;
2) At the end of the last period for which premium contributions for such
coverage have been made, if the employee or other responsible person does
not make, when due, the required premium contribution to the policyholder,
3) The date ending the maximum period. In the case of Qualifying Event 2
above (relating to termination of employment or reduction in hours), this date
GMC -1 6/95 13
•
• •
r
shall be the date eighteen (18) months after the date of that Qualifying Event;
unless the covered person is disabled at the time of his termination or
reduction in hours, in which case this date shall be twenty-nine (29) months
after the Qualifying Event. In all other cases, such date shall be the date
thirty-six (36) months after the date of that Qualifying Event which applies;
4) The date the covered person becomes a covered employee under any other
group health plan;
5) The date the covered person becomes eligible for Medicare; or.
6) In the case of the employee's spouse or former spouse, the date such
covered person remarries and becomes covered under any other group
health plan.
Conversion Privileges
A covered person whose coverage terminates shall have the right to a conversion
policy issued by the company.
There is no right of conversion if:
1. the termination of coverage occurred because of the covered person's
failure to make a required premium contribution or the discontinued or
terminated group coverage was replaced by similar group coverage
within thirty-one (31) days of the discontinuance; or
2. the'covered person is or could be covered by Medicare; or
3. the covered person has similar benefits under another group or
individual plan whether insured or uninsured;
4. the covered person is eligible for similar coverage under another group
plan whether insured or uninsured; or
5. similar benefits are provided for or are available to the covered person
under any state or federal law.
Written application and payment of the first premium must be made to the company
within thirty-one (31) days after the date coverage terminates.
No evidence of insurability is required.
GMC-1 6/95 14
CLAIMS
Proof of Loss
Written proof of a claim must be given not later than December 31 of the calendar
year following the one in which the services, supplies or treatment causing the claim
were received.
Subject to all applicable statutory provisions and rules and regulations of the
Arkansas Insurance Department, all benefits payable under this policy shall be
payable immediately upon receipt of written proof of loss.
Facility of Payment
The company may, at its option, pay all or any benefits to the hospital, other
institutions or the person giving medical services or supplies to the covered person.
Any payment made according to the above paragraph shall discharge the company
to the extent of any such payment. The company shall not be bound to see to the
use of the money so paid.
Legal Actions
The covered person may not bring suit to recover until 60 days after written proof of
loss is furnished. No suit may be brought more than three years from the time
written proof of loss is required to be given.
Not Worker's Compensation Insurance
The insurance provided by the policy shall not take the place of and shall not affect
any requirement for coverage by Worker's Compensation Insurance.
Assignment
No assignment of benefits under this policy shall be valid until approved and
accepted by the company. The company reserves the right to make payment of
benefits, in its sole discretion, directly to the provider of service or to the covered
person.
Claim Review
If a claim for benefits is denied either in whole or in part, the employee shall receive
a notice explaining the reason or reasons for the denial. The employee may request
a review of a denial of benefits for any claim or portion of a claim by sending a
written request to the Appeals Coordinator, Arkansas Blue Cross and Blue Shield, A
Mutual Insurance Company, Post Office Box 2181, Little Rock, AR 72203. The
employee's request must be made within 60 days after he has been notified of the
denial of benefits.
In preparing his request for review, the employee or his duly authorized
representative shall have the right to examine documents pertinent to the
employee's claim. However, medical information may be released to the employee
only upon the written authorization of his physician. The employee or his
representative may submit, with his request for review, any additional information
GMC-1 6/95 15
L ' • •
relevant to his claim and may also submit issues and comments in writing. A
complete review shall then be made of all information relating to the claim. The
employee shall receive a final decision in writing within sixty (60) days after the
receipt of his review request, except where special circumstances require extensive
review. A final decision shall be sent to the employee after no longer than 120 days.
The company acting on behalf of the Plan shall have authority and full discretion to
determine all questions arising in connection with the employee's insurance benefits,
including but not limited to eligibility, interpretation of Plan language, and findings of
fact with regard to any such questions. The actions, determinations and
interpretations of the company acting on behalf of the Plan with respect to all such
matters, and with respect to any other matters within the scope of its authority, shall
be conclusive and binding on the employee and the policyholder.
GMC-1 6/95 16
f; - .a
GENERAL PROVISIONS
Entire Contract
The entire contract of insurance is made up of this policy, the benefit certificate
issued to employees, amendments to the policy, amendments to the benefit
certificate and the application of the policyholder attached. The individual
applications also become a part of this contract. Benefit Summary Cards issued to
covered persons are for convenient summary only and do not constitute part of this
contract of insurance. In the absence of fraud, all statements made by the
policyholder or by persons insured are representations and not warranties. No such
statement shall be used in any contest under this policy unless it is contained in a
written instrument and a copy of such instrument is or has been furnished to such
person.
Time Limit on Certain Defenses
Except for nonpayment of premium, this policy shall not be contested after it has
been in force for two years. Statements a covered person makes about his
insurability shall not be used to void insurance or deny a claim unless:
1. the statements are contained in a written document signed by the covered
person; and
2. the loss on which claim is based occurs within two (2) years following the date
of the signed written document.
Changes to Policy
The company reserves the right to amend this policy, in which case the amendment
shall be deemed an amendment to the policyholder's employee health benefit plan.
The procedure for amendment to this policy and the Plan shall be that the company
shall give 30 days' written notice to the policyholder, and the change shall go into
effect on the date fixed in the notice.
No agent or employee of the company may change or modify any benefit, term,
condition, limitation or exclusion of this policy. Any change or amendment must be
in writing and signed by the President of the company.
Premium Payments
All premiums are payable at the company's Home Office. The policyholder must
make the first premium payment on or before the date the insurance is scheduled to
take effect. Future premiums are due and payable in advance.
Premium Rates
The premiums charged for insurance under this policy may be changed with 30 days
written notice:
1. on any premium due date, after the policy has been in force for twelve
months; or
2. if the policy's terms have been changed.
Grace Period
Any premium for this insurance which is not paid on or before the date it becomes
due is in default. After the first premium payment, the policyholder shall be allowed
GMC-1 6/95
17
•
a 31 days grace period. The company, at its sole discretion may extend the grace
period for a period longer than 31 days. During the grace period, there is no interest
charge and the insurance shall remain in force.
Termination of This Policy
The policyholder may terminate this policy on any premium due date by giving the
company written notice of termination in advance of the premium due date. Any
premiums paid beyond the requested termination date shall be refunded.
The company may terminate this policy on any premium due date by giving the
policyholder thirty (30) days written notice. The termination date may not be before
the last day for which the company has received peemiums.
This policy shall terminate at the end of the grace period, if the premium due is not
paid within the grace period.
When the policy terminates, the policyholder is liable to the company for payment of
all premiums which are due but unpaid at the time of termination. If the insurance
has extended into the grace period, prior to termination, the policyholder shall be
charged a pro -rated premium.
It is the duty of the policyholder, and not the company, to notify all affected covered
persons that the policy and their coverage is terminated. The company shall not be
responsible under any circumstances to provide notices to any employee or other
covered person of the status of premium payments, coverage or the lack of
coverage under this policy or the Plan.
Records and Reports
The policyholder shall keep records and furnish information to the company upon
request regarding:
1. covered persons and their insured dependents;
2. changes in the amounts of insurance; and
3. termination of insurance.
Clerical Errors
A clerical error shall not affect the amount of insurance to which the covered person
is entitled. Delay or failure to report termination of any insurance shall not continue
the insurance in force beyond the date it terminates. A retroactive adjustment of
premium, for up to 12 months, shall be made if clerical error is found.
Certificate of Insurance
The company shall provide the policyholder with benefit certificates or booklets like
the one which is incorporated into and made a part of this policy. It is the obligation
of the policyholder to distribute these benefit certificates to each covered person.
ERISA Notices and Plan Documents
Policyholder, and not the company, shall be responsible, as Plan Administrator, for
providing all ERISA notices and summary plan descriptions to covered persons.
GMC-1 6/95 18
Sex and Number
When used in this policy, the masculine includes the feminine, the singular the
plural, and the plural the singular.
Conformity With Statutes
If any provision does not comply with any law of the State of Arkansas, this policy is
deemed amended to meet the minimum requirements of the law, unless such law is
pre-empted by federal law or found to be void by a court of competent jurisdiction, in
which case any amendment to the policy required by the pre-empted or voided law
shall be deemed rescinded.
GMC-1 6/95 19
POLICY PROVISIONS RELATIVE TO MEMBERSHIP, MEETINGS AND VOTING
Membership
The policyholder is a member of Arkansas Blue Cross and Blue Shield, a Mutual
Insurance Company.
Annual Meeting
An annual meeting of the members shall be held each and every calendar year in
the State of Arkansas for the purpose of electing directors, receiving and considering
reports as to the business and affairs of the Corporation and transacting such other
business as may properly come before the meeting. The meeting shall be held
between January 1 and April 1 of each year at such place, date and time as shall be
fixed by the Board of Directors or the Chief Executive Officer. The Board of
Directors may, from time to time, provide that the place, date and time of the annual
meeting shall be set forth in the policy of members as provided in Article III, Section
3 of these Bylaws.
"THE ANNUAL MEETING OF THE MEMBERS SHALL BE HELD
EACH YEAR AT THE HOME OFFICE, LOCATED AT 601 GAINES
STREET, LITTLE ROCK, ARKANSAS, ON THE THIRD MONDAY IN
MARCH AT 1:00 P.M. (PROVIDED, IF SUCH DAY SHALL BE A
LEGAL HOLIDAY, THEN AT THE SAME TIME AND PLACE ON THE
NEXT SUCCEEDING DATE WHICH IS NOT A LEGAL HOLIDAY)."
Special Meetings
A special meeting of members for any purpose may be called by the Board of
Directors or Chief Executive Officer, and shall be called by the Chief Executive
Officer of the Secretary at the request of members holding one-third (1/3) of the
voting power entitled to vote thereat. Such request shall state the purpose or
purposes of the meeting, and no other business outside the scope of the state
purpose or purposes shall be transacted. Unless ordered by the Board of Directors,
the time and place of each special meeting of members shall be determined by the
Chief Executive Officer.
Notice of Meetings
So long as each insurance policy issued by the Corporation sets forth the place, date
and hour of the annual meeting of members, no notice of any annual meeting shall
be required to be given to any member, regardless of the number or nature of
proposals to be considered and voted upon at the annual meeting. If notice of the
annual meeting is not set forth in each insurance policy, written or printed notice of
the annual meeting and every special meeting of the members, stating the place,
date, time and the purpose or purposes of such meeting shall be given to the
members entitled to vote at such meeting not less than ten (10), nor more than sixty
(60), days before the date of the meeting. All such notices shall be given, either
personally or by the mail, by or at the direction of the Chief Executive Officer or
Secretary unless ordered by the Board of Directors. Notices which shall be mailed
shall be deemed to be "given" when deposited in the United States Mail addressed
to the member at the member's address as it appears on the records of the
Corporation, with postage prepaid [first class mail], if the notice is mailed thirty (30)
GMC-1 6/95 20
days or
less
before the
date of the meeting],
and any notice
transmitted other than
by mail
shall
be deemed
to have been "given"
when delivered
to the member.
Quorum
Except as otherwise provided by applicable law, a majority of the members of the
Corporation (present in person or by proxy) shall be necessary to constitute a
quorum for the transaction of business at any annual or special meeting of the
members of the Corporation.
Voting Rights
Each member shall be entitled to one vote for each policy held by him upon each
matter coming to a vote at meetings of members. Provided, a group policyholder
shall be entitled to a number of votes equal to the number of certificate holders
insured under the group policy. Such vote may be exercised in person or by written
proxy.
Vote Required
A majority of the voting power represented at any meeting of members shall be
necessary and sufficient to approve any given matter. There shall be no cumulative
voting.
Proxy
At all meetings of members a member may vote by proxy executed in writing by the
member or by the member's duly authorized attorney in fact. Such proxy shall be
filed with the Secretary before commencement of the meeting or at such late time as
shall be expressly permitted by the Corporate officer presiding at such meeting.
Each application for an insurance policy issued by the Corporation shall contain a
provision pursuant to which the policyholder thereof grants a revocable proxy to the
Board of Directors with respect to all matters to be considered and voted upon by
members at any meeting occuring while such insurance policy is in force.
GMC-1 6/95 21
�.� ®Arkansas
BlueCross BlueShield
® ® An Independent Licensee of the Blue Cross and Blue Shield Association
ARKANSAS BLUE CROSS AND BLUE SHIELD,
A MUTUAL INSURANCE COMPANY
601 Gaines Street
Little Rock, Arkansas 72201
GROUP APPLICATION
APPLICATION by
City of Fayetteville &
Fayetteville Public Library
(herein called "Applicant")
for a Group Policy covering the employees of Applicant and the eligible dependents of
such employees.
In making this application, Applicant agrees to the terms of the Group Policy, including
but not limited to the Covenants of the Policyholder, and to pay the required premium.
This Application is made and delivered in the State of Arkansas and is governed by the
laws of Arkansas. This Application is incorporated in and made a part of the Group
Policy.
Signed at 1/.3 /tl.Tounf4,n, Fayg4eu;llc this /6 M o, c l pr, / . 19 96
By;
City of Fayetteville &
Fayetteville Public Library
Applicant
nature
ARKANSAS BLUE CROSS AND BLUE SHIELD
A MUTUAL INSURANCE COMPANY
Accepted By: #'
' Authorized Signature
GA -1 6/95
K559-'76
/3/c C/ cSS /J/G ¢ 54ie /fr
amend.
6-i-96
PrS.
AMENDMENT TO THE ARKANSAS BLUE CROSS AND BLUE SHIELD
GROUP CONTRACT
FOR 1VIICROFILMED
CITY OF FAYETTEVILLE
Group Number
090041
Schedule A of the Arkansas Blue Cross and Blue Shield Group Contract is
amended to show the rates effective 06/01/96 .
Charges for each enrolled employee shall be as follows:
Monthly Charge
Per
Covered Employee
ONE PERSON FAMILY
COVERAGE COVERAGE
HEALTH $116.61 $282.41
DENTAL $14.26 $49.97
TOTAL $130.87 $332.38
Initial charges shall be paid on the Effective Date and no coverage shall be in
effect until such payment is received by the Plan. Subsequent charges shall be
payable on or before the same day as the Effective Date of each month
thereafter.
This Amendment becomes a part ofthe Arkansas Blue Cross and Blue Shield
Group Contract.
Robert L. Shoptaw, President
ARKANSAS BLUE CROSS AND BLUE SHIELD,
A Mutual Insurance Company
601 Gaines Street
Little Rock, Arkansas 72201