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HomeMy WebLinkAboutFlex-Plan Services Inc - Administrative Services Agreement. A KNOWLEDGEABLE INN V T[V ~J FLEX-PLAN SF;RVICF.S iNCORI'ORATF,D ADMINISTRATIVE SERVICES AGREEMENT (For Sec 125 Cafeteria plan with Premium Conversion, and Health & Day Care Flexible Spending Accounts) This Administrative Services Agreement ("AgreemenY') between Flex-Plan Services, Inc. ("Flex-Plan") and City of Auburn ("Company"), effective January 1, 2009 specifies the services to be provided by Flex-Plan to Company, and to Company's enrolled eligible employees ("Participants"), in the ongoing administration of the Company's Benefit Plan (the "Plan") under I.R.C. Section 125 and the specified responsibilities of the Company. The Company shall be the Plan Administrator, Sponsor, and Named Fiduciary, and Flex-Plan shall be the administrative firm which shall be engaged as an independent contractor in the pertormance of administrative services for the Plan. NOW, THEREFORE, for good and valuable consideration, the parties agree that Flex-Plan will perform the following Services on behalf of Company pursuant to the terms of this Agreement, and the Company shall perForm its responsibilities and make payments as described herein: RESPONSIBILITIES OF FLEX-PLAN. 1.1 PLAN DESIGN AND IMPLEMENTATION. Flex-Plan shall: 1.1.1 Determine Plan provisions, contributions, options, specifications, subject to the direction and approval of Company; 1.1.2 Prepare the Standard Plan Document and the Standard Summary Plan Description to be submitted to the Company for customization or revision. 1.1.3 Determine processing and administration specifications. 1.2 OPEN ENROLLMENT AND COMMUNICATION. Flex-Plan shall: 1.2.1 Design, prepare and deliver to Company informational enrollment packets (Electronic version available as well as hard copy). 1.2.2 Provide and maintain on-line claim forms to Company or Participants. 1.2.3 Maintain operational toll-free telephone customer assistance (1-800-669-FLEX) for Participant and Company use, weekdays, 8 a.m. to 5 p.m. Pacific Time, excluding holidays. 1.2.4 Maintain operational web site information, for the benefit of Company and Participants, at: www.flex-plan.com. 1.2.5 Provide and maintain operational electronic format for enrollment data transfer to Company. 1.3 PLAN PROCESSING AND ADMINISTRATION. Flex-Plan shall: 1.3.1 Provide for distribution of reimbursement checks, and if requested by the Company to be distributed, account statements, according to applicable laws, rules and regulations. Such checks will be issued within finro business days after the later of: (1) the scheduled processing date; or (2) the date that Flex-Plan receives back the contribution sheet from the Company; 1.3.2 Provide employer monthly reports to Company, including: 1.3.2.1. Contribution Eligibility Worksheet transmittal, which is delivered to the Company, subject to the timely return of the Employee Contribution Worksheet, and final version reconciled by the Company and returned to Flex-Plan; 1.3.2.2. Year to date Participant, and aggregate, account balances; 1.3.2.3. Disbursement register itemizing all reimbursements for each processing Mailing Address: date; Web Access: Corporate Office: P.O. Box 53250 www.flex-plan.com 11400 SE 6th Street, Suite 125 Bellevue, WA 98015-3250 flexplan@flex-plan.com Bellevue, WA 98004 425.4523500 800.669.FLEX Fax 425.451.7002 1.3.3 Provide annual forfeiture report, for Participant funds that have been forfeited, within ninety (90) days after the Plan's claims run-out period has expired. 1.4 PLAN COMPLIANCE. Flex-Plan shall: 1.4.1 Prepare and propose to the Company all Plan Documents, and all amendments thereto, to be reviewed by the Company, approved or modified by the Company, and delivered back to Flex-Plan; 1.4.2 Prepare and propose to the Company the Summary Plan Description, and all amendments thereto, to be reviewed by the Company, approved or modified by the Company, and delivered back to Flex-Plan; then to be maintained by Flex-Plan, available in an electronic format; 1.4.3 Store and retain claims for eight (8) years after date of claim; 1.4.4 Perform claims substantiation and adjudication, including verification of date, service, and cost of service; 1.4.5 Perform annual Discrimination Testing. Testing is contingent upon the return of the Non-Discrimination Worksheet and will be conducted at no cost. 1.5 DIRECT DEPOSIT: Flex-Plan shall: 1.5.1 Create customized election forms for Participants; 1.5.2 Electronic Funds Transfer of reimbursement will be deposited into the individual Participant bank account within two business days after the later of: (1) the scheduled processing date; or (2) the date that Flex-Plan receives back the contribution sheet from the Company (see fee schedule in the attached Exhibit A). 1.6 ENROLLMENT MEETINGS & BENEFIT FAIRS. 1.6.1 Flex-Plan shall provide on-site enrollment meetings and attendance at benefit fairs, as reasonably requested by Company, for the fees and costs set forth in the attached Exhibit A. 1.7 CONTRACT COMPLIANCE. 1.7.1 Flex-Plan will comply with, and all deliverables provided by Flex-Plan to the Company or Participants under this Agreement shall comply with, all applicable codes, rules and regulations, including, but not limited to 26 USCS. 2. FEE SCHEDULE. The Fee Schedule, of costs and fees to be paid by the Company to Flex-Plan, is attached hereto as Exhibit A. 3. RESPONSIBILITIES OF THE COMPANY. 3.1 PAYMENT. Company will remit full payment to Flex-Plan of all billed costs and fees, pursuant to the terms of section 2 hereof and any attached exhibits, within thirty days after delivery to the Company of the monthly administrative invoice. 3.2 REPORTING. The Company shall report all new Participants, and all changes in employment or Participant information, and all terminations of Participants from the Plan, and all unpaid Participant leaves of absence, on the same day of each such occurrence. The Company shall also verify contribution information, all year to date information, and Participant annual elections for each pay date. The Company shall also confirm the Contribution Eligibility Worksheet data. In the -2- 09182008 event that such occurrences are not timely reported or information not timely verified, and in the event that there are disbursements made by Flex-Plan that would not have been made if the occurrence had been timely reported, then the Company shall be responsible for such disbursements up to the annual election amount, and shall reimburse Flex-Plan therefore upon request by Flex-Plan. Company shall be responsible for all Participant deductions and Participant assets within its control, and shall apply those funds as described herein. 3.3 FUNDING. Terms are set forth in the attached Exhibit B. 3.4 REPORT RECONCILIATION. Company shall reconcile Flex-Plan's Contribution Eligibility Worksheet against payroll deductions for each processing date. If the Company cannot or does not perform this responsibility, Flex-Plan may charge the rate described in the attached Exhibit A for reconciling employer provided payroll reports, as further described in section 3.2 herein. 3.5 ACTION ON DISCRIMINATORY PLAN. Company shall initiate and timely complete appropriate action required in the event the Plan(s) become discriminatory. 3.6 FINAL DETERMINATIONS Company shall determine all final benefit appeals, change in status determinations, and plan eligibility. 3.7 PLAN COMPLIANCE Company shall: 3.7.1 Ensure compliance with IRS Code, COBRA, HIPAA, ERISA and other applicable federal and state laws. 3.7.2 File any required tax or governmental returns, including, but not limited to, the 5500 or any applicable schedules. 4. ADVERTISING. Flex-Plan may indicate in its marketing materials and proposals to other prospective customers that this Agreement has been awarded, and may describe the nature and objective(s) of this engagement. No such statements by, or materials of, Flex-Plan will disclose any Company confidential or proprietary information. 5. CONFIDENTIALITY. Flex-Plan respects Company's and Participants' right to privacy. All Company data including, but not limited to, all Company Participant information related to Participants' names, salaries, wage information and healthcare expense data, are confidential and Flex-Plan covenants and agrees that it will not, directly or indirectly, use or disclose confidential data except as otherwise described herein, to Flex-Plan employees, on a need to know basis, as necessary to provide services to the Company and Participants as described herein. Further, Flex-Plan will maintain all information, medical or otherwise, in compliance with all applicable statutes, codes, and regulations, and as may be required by any governmental regulatory body or any duly constituted court. -3- 09162008 6. OWNERSHIP OF REPORTS AND DATA. All reports and data prepared by Flex-Plan, or prepared by Flex-Plan with input from the Company, pursuant hereto, provided that it is not confidential Participant data, remain the property of the Company. Flex-Plan will provide the Company with all data generated pursuant hereto, upon request of the Company, in electronic or printed format used in its administration procedures. 7. TERM OF AGREEMENT. This Agreement will be effective commencing the date first written above, and shall continue for a period of one year thereafter or until the designated end of the first Plan Year, whichever shall first occur. In the absence of notice of termination by either party more than 30 days prior to the end of the initial term, or prior to the end of a successive term thereafter, then the term hereof shall automatically renew for an additional term of one year at the end of each successive one-year term. Notwithstanding the foregoing, the term of this Agreement may be terminated by either party, at any time during the initial term or subsequent terms, upon 30 days prior notice from one party to the other. Upon termination of the term hereof, each of the parties agrees that it shall fully comply with the requirements hereof, and shall complete any then-required performance in a timely manner. 8. INDEMNIFICATION: The Company shall defend, hold harmless, and indemnify Flex-Plan from and against any damages, liabilities, claims, costs, and expenses, including reasonable attomeys' fees, whether at arbitration, trial, on appeal, or in any regulatory proceeding (herein collectively "Claims") relating to the Company's default in performance of any of its duties in this Agreement, or related to the acts or omissions of the Company; provided, however, that the obligation to defend, indemnify, and hold harmless shall not apply to the extent such Claims result from the acts or omissions, including negligence or willful misconduct, of Flex-Plan. 9. FORCE MAJEURE Neither party shall be liable for failure to perForm under this Agreement if such failure to perform arises out of causes beyond the control and without the fault or negligence of the non-performing party. Such causes may include, but are not limited to, acts of God, war or other major upheaval, fires, floods, epidemics, quarantine restrictions, unusually severe weather, and failure or disruptions in utilities due to strike, labor disputes, or acts of nature. This provision shall become effective only if the party failing to perform notifies the other party within 72 hours of the extent and nature of the problem, limits delay in performance to that required by the event, and takes reasonable steps to minimize delays. This notice provision shall be effective unless failure to notify is beyond the control and without the fault or negligence of the non-perForming party. 10. MISCELLANEOUS. 10.1 The attached Exhibits are hereby incorporated as though fully set forth herein. 10.2 This Agreement is the complete agreement of the parties hereto, and it supersedes all prior written or oral agreements, as to the subject matter contained herein. 10.3 This Agreement shall be governed by the laws of the state of Washington and any dispute arising out of this Agreement will be settled in any court of competent jurisdiction in King County, Washington. "FLEX-PLAN" FLEX-PLAN SERVICES, I C. By: Jim Aitken Title: President Date: 12/28/2008 • 09182008 "COMPANY" City of uburn By: Title: ,/Ilo,i ir Date:_ 1 -4- EXHIBIT A FEE SCHEDULE The Company shall pay to Flex-Plan the following fees and costs, for the services and products of Flex-Plan delivered pursuant hereto: 11. Annual Fees: 11.1 For the Plan administration -$600.00 annual fee. 11.2 Per Participant, $6.00 annual Flexible Spending Account ("FSA") enrollment fee per Participant. 12. Monthly Processing Fees: For processing and administration, the Company shall pay to Flex-Plan the following fees ($50/month minimum): 12.1 $5.00 per month per FSA Participant (for Participants 1-100) 12.2 $4.00 per month per FSA Participant (for Participants 101 - 200) 12.3 $3.00 per month per FSA Participant (for Participants 201 and more) $50/month minimum applies to each of the following: 12.4 General Purpose FSA 12.5 Limited Purpose FSA 12.6 Affiliate Employer FSA 13. Mailing Fee: $1.10 per check/statement mailed. 14. Summary Plan Description Fee: $3.50 per Summary Plan Description produced and provided to each participant. Provided only upon company request. 15. Electronic Funds Transfer: $10.00 per returned item, from attempted deposit in Participant account. 16. Enrollment Meetings and Benefit Fairs: For on-site enrollment meetings and attendance at benefit fairs by Flex-Plan: 16.1 Company shall pay to Flex-Plan $75.00 per hour, or $300.00 per eight-hour day, whichever is less; 16.2 Air travel and lodging expenses shall be charged to the Company at Flex-Plan's cost; 16.3 Automobile mileage is charged at $.36/mile, plus $37.50/hour driving travel time. 16.4 Air travel time is charged as a full day cost, of $300.00 per day. 17. Report Reconciliation: In the event that the Company does not, or cannot, perform the reconciliation of the Flex-Plan monthly report, as described in section 3.4 of the Agreement, then Flex-Plan will perform the reconciliation for $75/hr., with a minimum of $75.00 per report. 18. Plan Termination Fees: In the event Company terminates the Plan, Company shall pay to Flex-Plan the following fees: 18.1 $5.00 per check issued or direct deposit initiated. 19. Plan Document Amendment Fee: $150 per mid plan year plan document amendment. -5- os,s2oos EXHIBIT B CONTRIBUTION FUNDING 20. Participant contributions are due 10 business days after the pay date deduction. 21. In the event that Participant contributions are not timely received, then processing of payments shall not commence until contribution funds are received by Flex-Plan. 22. In the event that, at any time during the term hereof, or at the end of the term hereof, participant disbursements have exceeded the then-current participant contributions, then, upon notice from Flex- Plan to the Company, the Company shall, within fifteen (15) days after that date of notice, deliver to Flex-Plan an amount equal to that deficit. -6- os,azooe EXHIBIT C BENEFIT ("BENNY") CARD SERVICES This Exhibit C, to that Administrative Services Agreement (the "Agreement") executed between City of Auburn (the "Company°) and Flex-Plan Services, Inc. ("Flex-Plan°), is made effective January 1, 2009, and is hereby incorporated into the Agreement, as though fully set forth therein. By execution of this Exhibit C, the Company has elected to take advantage of, and Flex-Plan has agreed to supply the services of, the Flexible Spending Account charge card (the "Benny Card") as further described herein. This Exhibit specifies the services to be provided by Flex-Plan to Company, and to Company's enrolled eligible employees ("Participants"), in the use and administration of the Company's benefit card aspect ("Benny Card Plan°) of the Company's Benefit Plan (the "Plan") under I.R.C. Section 125, for use of the Benny Card to pay for Eligible Health Care Flexible Spending Expenses, and further specifies the responsibilities of the Company. 23. RESPONSIBILITIES OF FLEX-PLAN. 23.1 PLAN DESIGN AND IMPLEMENTATION. Flex-Plan shall: 23.1.1 Determine Benny Card Plan provisions, options, specifications, subject to the direction and approval of Company; 23.1.2 Determine processing and administration specifications. 232 PLAN PROCESSING AND ADMINISTRATION. Flex-Plan shall: 23.2.1 Flex-Plan shall deliver to the Company enrollment materials, including a form for Participant execution that specifies that Participant shall use the Benny Card only for eligible purposes. 23.2.2 Deliver to the Participant a monthly summary by email on or about the first of each month. Said summary form will include all Benny Card swipes made in the previous month that require substantiation and will request that the Participant fax back to Flex-Plan the completed documentation form along with the receipt, bill or statement for the transaction. Upon receipt of the completed form and supporting receipt, bill or statement, retroactively review each charge on the Benny Card; determine the validity of each charge by the Participant on the Benny Card and then supply to the Participant by email the determination for the charges. 23.2.3 Provide for timely payment to the recipient bank the approved charges on the Benny Cards, subject to applicable laws, rules and regulations. 23.3 PLAN COMPLIANCE. Flex-Plan shall perform claims substantiation and adjudication, as described, including verification of date, service, and cost of service. 24. RESPONSIBILITIES OF THE COMPANY. 24.1 ENROLLMENT. Enrollment materials shall be delivered to Flex-Plan not less than 20 days prior to date of issuance of Benny Cards. 24.2 PAYMENT. 24.2.1 The Benny Card Deposit is waived for each year the Company uses the Contribution Funding Arrangement. -7- 09182008 24.2.2 In the event that the Company receives notice from Flex-Plan that a Participant charge has been denied, and that a Participant has not timely delivered the denied amount to Flex-Plan, then the Company shall deliver a sum equal to the denied amount to Flex-Plan prior to the end of the plan year. 24.3 EMAIL ADDRESSES: WAIVER. The Company shall deliver to Flex-Plan email addresses for all participants that have email. For the Participants that do not have email, the Company shall deliver to Flex-Plan the waiver form, which was supplied by Flex-Plan to the Company, signed by Participant, so that Flex- Plan can deliver the ParticipanYs verification request(s) by email to the Company. 24.4 VERIFICATION REQUEST DELIVERY. The Company will, for the Participants who do not have email, timely deliver the verification request received from Flex-Plan by email to the Participant for completion. 25. TERM OF AGREEMENT. The Plan, and this Exhibit C, shall be effective during the term set forth in the Plan. Upon termination of the term thereof, each of the parties agrees that it shall fully comply with the requirements hereof, and shall complete any then-required performance in a timely manner. 26. FEE SCHEDULE FOR BENNY CARD SERVICES. The Company shall pay to Flex-Plan the following fees and costs, for the services and products of Flex-Plan delivered pursuant to the terms of this Exhibit C, in addition to all fees and costs set forth in the Agreement. 26.1 CARD REPLACEMENT FEE Participants will incur a Replacement Fee of $10 for a lost, stolen, or replaced card. The Replacement Fee will be deducted from the ParticipanYs Health Care FSA. -8- 09182008 EXHIBIT D GRACE PERIOD ADMINISTRATION FOR HEALTH CARE AND 8 DAY CARE FLEXIBLE SPENDING ACCOUNTS This Exhibit D, to that Administrative Services Agreement (the "AgreemenY") executed between City of Auburn (the "Company") and Flex-Plan Services, Inc. ("Flex-Plan°), is made effective as of January 1, 2009, and is hereby incorporated into the Agreement, as though fully set forth therein. By execution of this Exhibit D, the Company has elected to take advantage of, and Flex-Plan has agreed to supply the services of, the IRS Notice 2005-42 Grace Period Administration (the "Grace Period") as further described herein. This Exhibit specifies the services to be provided by Flex-Plan to Company, and to Company's enrolled eligible employees ("Participants"), in the administration of the Company's Grace Period of the Company's Flexible Benefit Plan (the "Plan") under I.R.C. Section 125, for use of a Grace Period following the end of the plan year, and further specifies the responsibilities of the Company and Participant. 27. RESPONSIBILITIES OF FLEX-PLAN 27.1 DOCUMENTS. Flex-Plan shall: 27.1.1 Provide Plan Document and Summary Plan Description which include Grace Period for Health Care Flexible Spending Account and Day Care Flexible Spending Account. 27.1.2 Provide a stand alone amendment for the Company's Plan Document (for amended plans only). 27.1.3 Provide a Summary of Material Modifications upon Company's request (for amended plans only). 27.2 PLAN PROCESSING AND ADMINISTRATION. Flex-Plan shall: 27.2.1 Process Health Care Flexible Spending Account and Day Care Flexible Spending Account claims up to the 15th day of the third month following the end of the plan year. 27.2.2 Adjudicate and process claims during the Grace Period against the prior year account and apply any remaining claim balance against the current year. 27.2.3 Adjust any claim and associated reimbursement, previously submitted and processed in accordance with Section 27.2.2 by the Participant, between different plan years at the Participant's request. 28. TERM OF AGREEMENT. The Plan, and this Exhibit D, shall be effective during the term set forth in the Plan. Upon termination of the term thereof, each of the parties agrees that it shall fully comply with the requirements hereof, and shall complete any then-required performance in a timely manner. 29. FEE SCHEDULE FOR GRACE PERIOD. The Company shall pay to Flex-Plan the following fees and costs, for the services and products of Flex-Plan delivered pursuant to the terms of this Exhibit D, in addition to all fees and costs set forth in the Agreement: 29.1 ADJUSTMENT FEES. For account adjustments as described in Section 27.2.3, there will be a fee of $65.00 per transaction. 29.2 ADOPTION FEE. For adopting or removing the Grace Period in the middle of the plan year, there will be a cost to the company of $200.00. There will be no fee if the Plan is amended for the following plan year at the Plan renewal. -9- 09182008