HomeMy WebLinkAboutFlex-Plan Services IncorporatedA 1-1.1.10
KNOWLEDGEABLE INNOVATIVE ESTABLISHED
FLEX -PLAN
SERVICES INCORPOUFED
ADMINISTRATIVE SERVICES AGREEMENT
(For Sec 125 Cafeteria Plan with Premium Conversion, and Health & Day Care Flexible Spending Arrangements)
This Administrative Services Agreement ( "Agreement ") between Flex -Plan Services, Inc. ( "Flex - Plan ") and City of
Auburn ( "Employer "), effective January 1, 2015 specifies the services to be provided by Flex -Plan to Employer, and to
Employer's enrolled eligible employees ( "Participants "), in the ongoing administration of the Employer's Benefit Plan
(the "Plan ") under I.R.C. Section 125 and the specified responsibilities of the Employer.
The Employer shall be the Plan Administrator, Plan Sponsor, and Named Fiduciary, and Flex -Plan shall be the
administrative firm which shall be engaged as an independent contractor in the performance 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 Employer pursuant to the terms of this Agreement, and the Employer 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 Employer.
1.1.2 Prepare the Plan Document and the Summary Plan Description to be submitted to the
Employer 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 Employer enrollment forms and informational enrollment
packets (electronic soft copy version available as well as hard copy).
1.2.2 Provide and maintain claim forms to Employer and Participants.
1.2.3 Maintain operational toll -free telephone customer assistance (1- 800 - 669 -FLEX) for Participant
use weekdays 6 a.m. to 6 p.m. and Employer use 7 a.m. to 5 p.m. Pacific Time, excluding
holidays.
1.2.4 Maintain operational web site, for the benefit of Employer and Participants, at: www.flex-
plan.com.
1.2.5 Provide and maintain electronic format for enrollment data transfer to Employer.
1.3 PLAN PROCESSING AND ADMINISTRATION
Flex -Plan shall:
1.3.1 Provide claim reimbursements by check or direct deposit, and if requested by the Employer to
be distributed, account statements, according to applicable laws, rules and regulations. Such
claim reimbursements will be issued within two business days after the later of: (1) the
scheduled processing date; (2) the date Employer reconciles the Eligibility and Payroll
Deduction Report ( "EDR ") or submits an approved payroll report; or (3) the receipt of
Employer Contributions as required in Exhibit B.
1.3.2 Provide notification of availability of the following reports:
1.3.2.1. EDR, which is available online each pay date, and reconciled by the Employer and
submitted to Flex -Plan via our secure website;
1.3.2.2. Disbursement and Year -to -Date report on each reimbursement processing date
Mai ling Address:
Web Access:
Corporate Off-ice:
P.O. Box 53250
www.tlex- plan.com
11400 SE 6th Street, Suite 125
.Bellevue, WA 98015 -3250
flex plan @ flex- plan, com
Bellevue, WA 98004
425.452.3500
800.669.FLEX
Fax 425.45 1.7002
1.3.3 Provide annual forfeiture report, for 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 Store and retain claims for eight (8) years.
1.4.2 Perform claims adjudication, including verification of date, service, and cost of service.
1.4.3 Perform annual nondiscrimination testing. Testing is contingent upon the return of the
nondiscrimination request for information and will be conducted at no additional cost.
1.5 ENROLLMENT MEETINGS & BENEFIT FAIRS
1.5.1 Flex -Plan shall provide on -site enrollment meetings and attendance at benefit fairs, as
reasonably requested by Employer, for any fees and costs set forth in attached Exhibit A.
1.6 CONTRACT COMPLIANCE
1.6.1 Flex -Plan will comply with, and all deliverables provided by Flex -Plan to the Employer 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 Employer to Flex -Plan, is attached hereto as
Exhibit A.
3. RESPONSIBILITIES OF THE EMPLOYER
3.1 PAYMENT
Employer will remit full payment to Flex -Plan of all billed costs and fees, pursuant to the terms of
section 2 hereof, within thirty days after delivery to the Employer of the administrative invoice.
Balances must be paid before next billing cycle or interest of 1.5% per month (18% APR) will accrue.
3.2 REPORTING
The Employer 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. In the 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 reported on the same day of each
such occurrence, then the Employer shall be responsible for such disbursements up to the annual
election amount, and shall reimburse Flex -Plan therefore upon request by Flex -Plan. The Employer
shall also verify the EDR or submit an approved payroll report, year to date information, and
Participant annual elections for each pay date. Employer shall be responsible for accurate Participant
payroll deductions, reporting of deductions, and W -2 reporting.
3.3 FUNDING
Terms are set forth in the attached Exhibit B.
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3.4 REPORT RECONCILIATION
Employer shall submit an approved payroll file or reconcile Flex - Plan's EDR against payroll deductions
for each processing date through Flex - Plan's secure online employer portal. If the Employer 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. If
Employer fails to provide the approved payroll file or reconcile the EDR for more than forty -five (45)
days from the pay date deduction Flex -Plan may suspend claim processing.
3.5 NONDISCRIMINATION TESTING
Employer shall complete and return the nondiscrimination request for information each Plan year.
Employer shall initiate and timely take corrective action as required in the event the Plan(s) is found to
be discriminatory.
3.6 FINAL DETERMINATIONS
Employer shall determine all final benefit appeals, change in status determinations, and Plan eligibility.
3.7 PLAN COMPLIANCE
Employer shall:
3.7.1 Ensure compliance with IRS Code, COBRA, HIPAA, ERISA and other applicable federal and
state laws.
3.7.2 Amend the Plan Document as necessary to ensure ongoing compliance with applicable laws
and make available the summary Plan description, summary of material modifications and any
other required ERISA notices to all Participants.
3.7.3 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 Employer confidential or proprietary information.
5. CONFIDENTIALITY
Flex -Plan respects Employer's and Participants' right to privacy. All Employer data including, but not limited to,
all 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 Employer and Participants. 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.
6. OWNERSHIP OF REPORTS AND DATA
All reports and data prepared by Flex -Plan, or prepared by Flex -Plan with input from the Employer, pursuant
hereto, provided that it is not confidential Participant data, remain the property of the Employer. Flex -Plan will
provide the Employer with all data generated pursuant hereto, upon request of the Employer, in electronic or
printed format used in its administration procedures.
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
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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. In
the event this Agreement is terminated, all Participant claims submitted to Flex -Plan after the effective date of
termination will be returned to Employer. Flex -Plan will have no further responsibility with respect to such
claims submitted after the effective date of termination. Flex -Plan reserves the right to retain as an additional
administrative fee any interest earned on such funds while held in a Flex -Plan maintained account. Flex -Plan
may suspend claim processing and terminate any or all services, in whole or in part, if Employer: files for
bankruptcy, becomes or is declared insolvent, is the subject of any proceedings (not dismissed within 30 days)
related to its liquidation, insolvency or the appointment of a receiver or similar officer, makes an assignment for
the benefit of all or substantially all of its creditors, takes any corporate action for its winding -up, dissolution or
administration, enters into an Agreement for the extension or readjustment of substantially all of its obligations,
or recklessly or intentionally makes any material misstatement as to its financial condition. Termination of this
Agreement shall not terminate the rights or obligations of either party arising prior to the effective date of such
termination. The indemnity, confidentiality and privacy provisions of this Agreement shall survive its
termination,
8. INDEMNIFICATION
The Employer shall defend, hold harmless, and indemnify Flex -Plan from and against any damages, liabilities,
claims, costs, and expenses, including reasonable attorneys' fees, whether at arbitration, trial, on appeal, or in
any regulatory proceeding (herein collectively "Claims ") relating to the Employer's default in performance of any
of its duties in this Agreement, or related to the acts or omissions of the Employer; 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, INC.
By:
Title: President
Date: 2/25/2015
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EXHIBIT A
FEE SCHEDULE
The Employer shall pay to Flex -Plan the following fees and costs, for the services and products of Flex -Plan delivered
pursuant hereto:
Plan Year Fees:
1.1 $600.00 for the Plan administration.
1.2 $6.00 enrollment fee per Participant.
2. Monthly Processing Fees: For processing and administration, the Employer shall pay to Flex -Plan the
following fees ($50 /month minimum):
2.1 $5.00 per month per FSA Participant (for Participants 1 -100).
2.2 $4.00 per month per FSA Participant (for Participants 101 - 200).
2.3 $3.00 per month per FSA Participant (for Participants 201 and more).
$50 /month minimum applies to each of the following:
2.4 General Purpose FSA.
2.5 Affiliate Employer FSA.
3. Mailing Fee: $1.10 per check mailed.
4. Summary Plan Description Fee: $3.50 per Summary Plan description printed and mailed to the employer or
Participants. Provided only upon Employer request.
5. Electronic Funds Transfer: $10.00 per returned item, from attempted deposit in Participant account.
6. Enrollment Meetings and Benefit Fairs: For on -site enrollment meetings and attendance at benefit fairs by
Flex -Plan:
6.1 Employer shall pay to Flex -Plan $75.00 per hour, or $300.00 per eight -hour day, whichever is less;
6.2 Air travel and lodging expenses shall be charged to the Employer at Flex - Plan's cost;
6.3 Automobile mileage is charged at $ .36 /mile, plus $37.50 /hour driving travel time.
6.4 Air travel time is charged as a full day cost, of $300.00 per day.
Report Reconciliation: In the event that the Employer does not, or cannot, perform the reconciliation of the
Flex -Plan EDR or provide an approved payroll 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.
8. Plan Termination Fees: In the event Employer terminates the Plan, Employer shall pay to Flex -Plan the
following fees:
8.1 $5.00 per check issued or direct deposit initiated.
9. Plan document Amendment Fee: $150 per mid Plan year Plan document amendment.
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EXHIBIT B
CONTRIBUTION FUNDING
Employer dollars equal to the amount of Participant contributions are due ten (10) business days after the pay
date deduction. In the event funding is not received within ten (10) days of the pay date deduction Flex -Plan
may suspend claim processing.
2. If at any time during the term hereof, or at the end of the term hereof, Participant claim reimbursements
(individual or aggregate) exceed employer dollars equal to the amount of Participant contributions (individual or
aggregate), then, upon notice from Flex -Plan to the Employer, the Employer shall, within fifteen (15) days after
that date of notice, deliver to Flex -Plan an amount equal to that deficit. In the event funding is not received
within fifteen (15) days of the notice Flex -Plan may suspend claim processing.
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EXHIBIT C
DEBIT CARD SERVICES
This Exhibit C, to that Administrative Services Agreement (the "Agreement ") executed between City of Auburn (the
"Employer ") and Flex -Plan Services, Inc. ( "Flex - Plan "), is made effective January 1, 2015, and is hereby incorporated
into the Agreement, as though fully set forth therein.
By execution of this Exhibit C, the Employer has elected to take advantage of, and Flex -Plan has agreed to supply the
services of, the Flexible Spending Arrangement charge card (the "Debit Card ") as further described herein. This
Exhibit specifies the services to be provided by Flex -Plan to Employer, and to Employer's enrolled eligible employees
( "Participants'), in the use and administration of the Employer's benefit card aspect ( "Debit Card Plan ") of the
Employer's Benefit Plan (the 'Plan ") under I.R.C. Section 125, for use of the Debit Card to pay for Eligible Health Care
Flexible Spending Expenses, and further specifies the responsibilities of the Employer.
1. RESPONSIBILITIES OF FLEX -PLAN
1.1 PLAN DESIGN AND IMPLEMENTATION
Flex -Plan shall:
1.1.1 Determine Debit Card Plan provisions, options, specifications, subject to the direction and
approval of Employer;
1.1.2 Determine processing and administration specifications.
1.2 PLAN PROCESSING AND ADMINISTRATION
Flex -Plan shall:
1.2.1 Deliver to the Employer enrollment materials, including a form for Participant execution that
specifies that Participant shall use the Debit Card only for eligible purposes.
1.2.2 Deliver to the Participant a monthly summary by email on or about the first of each month.
Said summary form will include all Debit Card swipes made in the previous month that require
substantiation and will request that the Participant submit to Flex -Plan the Debit Card
substantiation form along with the receipt, bill or statement for the transaction(s). Upon
receipt of the Debit Card substantiation form and supporting documentation, retroactively
review each charge on the Debit Card; determine the validity of each charge by the
Participant on the Debit Card and then supply to the Participant by email the determination for
the charges.
1.2.3 For contribution funded clients as stated in Exhibit B, provide for timely payment to the
recipient bank the approved charges on the Debit Cards, subject to applicable laws,
rules and regulations.
1.3 PLAN COMPLIANCE
Flex -Plan shall perform claims substantiation and adjudication, as described, including verification of
date, service, and cost of service.
2. RESPONSIBILITIES OF THE EMPLOYER
2.1 ENROLLMENT
Enrollment materials shall be delivered to Flex -Plan not less than 20 days prior to date of issuance of
Debit Cards.
2.2 FUNDING AND REPORTING
2.2.1 In the event that the Employer 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 Employer shall deliver a sum equal to the denied amount to Flex -Plan prior to the
end of the Plan year.
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2.2.2 If Employer fails to provide an approved payroll file or reconcile the EDR within forty -five (45)
days of the pay date deduction Flex -Plan may suspend claim processing including but not
limited to suspension of all Debit Cards
2.2.3 In the event funding is not received within ten (10) days of the pay date deduction Flex -Plan
may suspend claim processing including but not limited to suspension of all Debit Cards.
2.3 EMAIL ADDRESSES
The Employer shall deliver to Flex -Plan email addresses for all Participants requesting a Debit Card.
3. 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.
4. FEE SCHEDULE FOR DEBIT CARD SERVICES
The Employer 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.
4.1 DEBIT CARD REPLACEMENT FEE
Participants will incur a Replacement Fee of $5 for a lost, stolen, or replaced card. The
Replacement Fee will be deducted from the Participant's Health Care FSA.
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EXHIBIT D
CARRYOVER FOR HEALTH FLEXIBLE SPENDING ARRANGEMENT
This Exhibit D, to the Administrative Services Agreement (the "Agreement ") executed between City of Auburn (the
"Employer ") and Flex -Plan Services, Inc. ( "Flex - Plan "), is made effective as of January 1, 2015, and is hereby
incorporated into the Agreement, as though fully set forth therein.
By execution of this Exhibit D, the Employer has elected to take advantage of, and Flex -Plan has agreed to supply the
services of, the IRS Notice 2013 -71 Carryover Administration (the "Carryover') as further described herein. This
Exhibit specifies the services to be provided by Flex -Plan to Employer, and to Employer's applicable Employees.
1. RESPONSIBILITIES OF FLEX -PLAN
1.1 DOCUMENTS
Flex -Plan shall:
1.1.1 Provide Plan document and summary Plan description which include the Carryover language
for the health care flexible spending arrangement.
1.1.2 Provide a stand -alone amendment for the Employer's Plan document (amended Plans only).
1.1.3 Provide a summary of material modifications upon Employer's request (amended Plans only).
1.2 PLAN PROCESSING AND ADMINISTRATION
Flex -Plan shall:
1.2.1 Carry over the lesser of the Balance in the health flexible spending arrangement as of the
Carryover Date or $500, from the previous year into the immediately following plan year. The
"Carryover Date" shall mean the date on or about the 15' day after the last day of the run -out
period. The Balance shall mean contributions less disbursements of the health flexible
spending arrangement.
122 Administer Carryover for the health care flexible spending arrangement and not the dependent
care flexible spending arrangement.
1.2.3 Reduce the prior year health flexible spending arrangement election according to the amount
of the carryover.
1.2.4 Establish a flexible spending arrangement and carryover balances for employees with
carryover amounts that failed to enroll in the health flexible spending arrangement in the
immediately following plan year.
1.2.5 Adjudicate and process claims against the carryover amount after the Carryover Date. Any
application of claims in the immediately following year against unused amounts in the prior
year before the Carryover Date shall be subject to additional fees as set forth in 3.1.1 below.
2. 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.
3. FEE SCHEDULE FOR CARRYOVER
The Employer 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:
3.1 FEES
3.1.1 For account adjustments as described in Section 1.2.5, there will be a fee of $65.00 per
transaction.
3.1.2 Monthly participant fees shall apply as of the Carryover Date for any carryover Balance
applied.
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