HomeMy WebLinkAboutItem 06.nDate: Item No.
AGREEMENT WITH 121 BENEFITS
COBRA Administration and Continuation Services
Proposed Action
Staff recommends adoption of the following motion: Move to approve the agreement between
the City of Lakeville and 121 Benefits.
Overview
121 Benefits has served as the City’s administrator for COBRA/Retiree services since October 1,
2016. The attached agreement with 121 Benefits is effective January 1, 2021 through December
31, 2022. NFP, the Agent of Record, currently pays the administrative fees. NFP is the Agent of
Record through February 29, 2024. The City would be responsible for the administrative fees if
NFP were no longer the Agent of Record. The minimum administrative fees are $200 per month
through December 31, 2022.
There are no other changes to the service agreement.
Primary Issues to Consider
•What specific services are provided by 121 Benefits?
121 Benefits will continue to provide COBRA administration and continuation
services to ensure the City is in compliance with Federal and State regulations.
Supporting Information
•121 Benefits Service Agreement
Financial Impact: $ Budgeted: Y☐ N☒ Source:
Related Documents: (CIP, ERP, etc.):
Envision Lakeville Community Values: Good Value for Public Services
Report Completed by: Tammy Schutta, HR Manager
November 16, 2020
Various Funds
Master Service
Agreement
September 17, 2020
Revised November 12, 2020
January 1, 2021 – December 31, 2022
COBRA Administration & Continuation Services
Continuation Administrative Services Agreement (Gov’t):
121 Benefits and
City of Lakeville
CONTINUATION ADMINISTRATIVE SERVICES AGREEMENT
THIS AGREEMENT, made on this ____ day of ________, 20__, by and between DRT Benefits
Corp. dba 121 Benefits, a Minnesota corporation (“Administrative Firm”) and City of Lakeville (“Employer”
and “Plan Administrator”).
WHEREAS, Employer has established and maintains certain benefit plans (the “Plans”) that are
“group benefit plans” that must comply with the Public Health Services Act (the “PHSA”) and state law; and
WHEREAS, the Plans are required to provide continuation coverage under applicable law; and
WHEREAS, Employer and Plan Administrator desire that Administrative Firm furnish certain
services described in this Continuation Administrative Services Agreement (the “Agreement”) in the
operation and administration of the Plans;
NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and
the exhibits and Addenda, if any, attached hereto, Employer, Plan Administrator, and Administrative Firm
hereby agree as follows:
I.Definitions
The following definitions shall apply to this Agreement:
A.Administrative Firm – means DRT Benefits Corp. dba 121 Benefits (including all of its
authorized representatives), an independent contractor designated to perform certain
Administrative Services pursuant to this Agreement with respect to the Plans.
B.Administrative Services - means those services relating to the administration of the Plans
to be performed by Administrative Firm as set forth in this Agreement and the exhibits
hereto.
C.Adopting Employer – means City of Lakeville.
D.Agreement - means this Continuation Administrative Services Agreement and any exhibits
attached hereto and any outside agreements specifically incorporated by reference.
E.Alternative Coverage – means coverage offered as an alternative to Continuation Coverage
to induce a Qualified Beneficiary not to elect Continuation Coverage.
F.Applicable Premium – means the cost to the Plan for a period of coverage (for example,
one, two or three months) for similarly situated Covered Individuals for whom a Qualifying
Event has not occurred.
G.Code - means the Internal Revenue Code of 1986 and regulations thereunder, as amended
from time to time.
H.COBRA - means the Consolidated Omnibus Budget Reconciliation Act of 1985 (as it
appears in the PHSA) and regulations thereunder, as amended from time to time.
I.Continuation Coverage – means the continuation coverage required to be provided with
respect to a Plan under applicable law. Such coverage may include continuation coverage
under a group health plan required by COBRA, USERRA, and/or state law and/or
continuation coverage under a group term life insurance plan required by state law.
J.Continuation Participant – means any person receiving Continuation Coverage under the
Plan(s) in accordance with applicable law. This includes, but is not limited to, Qualified
Beneficiaries.
K.Covered Individual – means an individual who is properly participating in the Plan(s),
including those receiving Continuation Coverage.
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L.Effective Date - means the date upon which this Agreement, once fully executed by all
parties, is first effective, January 1, 2021.
M.Fiduciary – means any person who satisfies the definition of “fiduciary” under applicable
law.
N.HIPAA - means the Health Insurance Portability and Accountability Act of 1996 and
regulations thereunder, as amended from time to time.
O.Insignificant Shortfalls – Payment amounts for Continuation Coverage within the lesser of
(i) $50, or (ii) ten percent (10%), of the actual amount due.
P.Plan or Plans - means the following programs or arrangements of benefits established and
maintained by Adopting Employer with respect to which Administrative Firm provides
Continuation Coverage Services under this Agreement.
Q.Plan Administrator – means Adopting Employer.
R.PHSA – means the Public Health Services Act and regulations thereunder, as may be
amended from time to time.
S.Qualified Beneficiary – means a Covered Individual who has lost coverage under a Plan as
the result of a Qualifying Event and who is entitled to receive Continuation Coverage.
Qualified Beneficiary includes, but is not limited to, individuals determined to be “qualified
beneficiaries” under COBRA.
T.Qualifying Event – means the loss of coverage under a Plan on account of an event
specifically identified in applicable law as an event triggering a right to Continuation
Coverage.
U.USERRA – means the Uniformed Services Employment and Reemployment Rights Act of
1994 and regulations thereunder, as amended from time to time.
II.Administrative Firm Responsibilities
A.Status of Administrative Firm. Adopting Employer shall not (1) name Administrative Firm
as Plan Administrator, nor (2) hold out to other parties or third parties that Administrative
Firm serves in any of the foregoing capacities. In addition, Administrative Firm does not
intend to assume any of the administrative duties or responsibilities commensurate with
such designations.
B.Capacity of Administrative Firm. In fulfilling its duties and obligations under this
Agreement, Administrative Firm shall act as the administrative agent of the Plans and does
not intend to be a “plan administrator” (as such term is defined under applicable law or the
Plans) of the Plans or with respect to the Plan assets. In addition, Administrative Firm shall
not be required to participate in or act in a manner that aids or assists a breach of a
Fiduciary’s duty.
C.Continuation Coverage Administration. Administrative Firm shall provide services with
respect to Continuation Coverage under the Plans as described in this Article II.
Administrative Firm will not provide any services regarding administration of the Plans
unless such service is specifically described in this Article II or is required under another
agreement among the Adopting Employer, Plan Administrator, and Administrative Firm.
D.Account Servicing and Employee Communication. The Administrative Firm shall provide
account management services. The Administrative Firm shall make available to the
Adopting Employer a client service representative to respond to questions regarding
general administrative issues.
E.Recordkeeping. The Administrative Firm shall keep all Plan records related to the
Administrative Services, including records of:
1.all Qualifying Events of which it is notified;
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2.all notices sent and received by it regarding Continuation Coverage;
3.any acceptance or rejection of Continuation Coverage;
4.the Applicable Premium, as determined by the Adopting Employer, and the
payment by Continuation Participants of the cost of Continuation Coverage;
5.the length of each Continuation Participant’s Continuation Coverage;
6. the offer of any required conversion coverage (if any);
7.second qualifying events; and
8.written COBRA procedures.
F.General Notices. If selected as an optional service in Exhibit A, Administrative Firm shall,
based upon information provided by Adopting Employer, issue a general COBRA notice to
all individuals who enroll in the Plan(s) (that are subject to COBRA) coincident with or
subsequent to the Effective Date. Administrative Firm is entitled to rely upon the
information provided by Adopting Employer and is under no obligation to independently
verify such information.
G.Continuation Coverage Eligibility, Notification of Right to Elect, and Notification of
Unavailability. Administrative Firm shall determine if a Qualifying Event has occurred
based upon information provided to it by the Adopting Employer and/or the person
making the claim for Continuation Coverage. Such determinations regarding claims shall
be made in accordance with the written terms and conditions of the Plan. With respect to
this responsibility, Administrative Firm is entitled to rely upon the information provided
by Adopting Employer and/or person making the claim and is under no obligation to
independently verify such information. If Administrative Firm determines a Qualifying
Event has occurred, Administrative Firm will generate and mail to the Qualified
Beneficiaries any notices and/or election forms required under applicable law or otherwise
necessary to facilitate the provision of Continuation Coverage.
If Administrative Firm determines no Qualifying Event has occurred, or a Covered
Individual is not entitled to Continuation Coverage or an extension of Continuation
Coverage, Administrative Firm shall notify any person whose claim for Continuation
Coverage is denied of the reasons for the denial and of the person’s rights, if any, to have
the denial reviewed in accordance with the terms and provisions of the Plan. The
notification and review will be in a manner agreed upon by Adopting Employer and
Administrative Firm. Administrative Firm will refer to Adopting Employer any claim or
class of claims specified in writing by Adopting Employer as well as any claim that is
disputed after the initial denial. Adopting Employer shall have final discretionary authority
to make all determinations regarding Continuation Coverage under the Plan.
Notices described herein will be provided based upon the address information provided by
Adopting Employer.
H.Reinstatement. If the Qualified Beneficiary elects Continuation Coverage (or is entitled
thereto without an election) and pays any required premiums within the required
timeframes with respect to any Plan, Administrative Firm shall complete and submit any
required documentation to insurance carriers and/or third party service providers
regarding reinstatement of coverage under such Plan for Continuation Coverage purposes.
I.Termination of Continuation Coverage. Except as specifically noted below, Administrative
Firm shall complete and submit any required documentation to insurance carriers and/or
third party services providers regarding termination of a Continuation Participant's
Continuation Coverage under a Plan, including, but not limited to, termination due to
expiration of the required continuation period or failure to timely pay premiums.
Administrative Firm shall also notify impacted Continuation Participants of the
termination of Continuation Coverage if such notification is required by applicable law. If
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such coverage is available, Administrative Firm shall also notify Continuation Participants
of the right elect conversion coverage upon termination of Continuation Coverage.
J.Collection of Continuation Coverage Premiums. Administrative Firm shall collect
payments for Continuation Coverage premiums and forward them to Adopting Employer
by the 15th of the month next following the month in which they were received.
Administrative firm shall not accept, as payment in full, insignificant shortfalls.
Administrative will send payment notice to collect such premium payments as in
accordance with COBRA regulations.
K.Open Enrollment. If selected as an optional service in Exhibit A, Administrative Firm shall
distribute annual enrollment materials to Continuation Participants entitled to participate
in open enrollment during the applicable annual open enrollment period and answer
questions from Continuation Participants regarding open enrollment. At the conclusion of
the open enrollment period, Administrative Firm shall provide to the Adopting Employer
and the applicable insurance carriers and/or third party service providers enrollment
and/or election information regarding the Continuation Participants. Adopting Employer
shall provide to Administrative Firm all information necessary to allow such Continuation
Participants to participate in open enrollment and Administrative Firm is entitled to rely
upon the information provided by Adopting Employer and is under no obligation to
independently verify such information.
L.Reports. Monthly, the Administrative Firm will prepare a remittance report detailing the
payments/premiums we have received and what month the payments cover.
M.Administrative Materials. At the direction of Adopting Employer and Plan Administrator,
Administrative Firm shall prepare draft documentation relating to Continuation Coverage
under the Plans, including, but not limited to, initial notices of rights, election notices,
election forms, and various administrative forms. Plan Administrator shall finalize and
approve for use the administrative documents. Unless mutually agreed otherwise, such
finalization shall be accomplished prior to the use or distribution of such documents.
N.Compliance with Applicable Law. Administrative Firm shall comply with applicable federal
and state laws and regulations applicable to Administrative Firm's responsibilities under
this Agreement.
O.Insurance. The Administrative Firm shall maintain professional liability and errors and
omissions insurance in the amount of $2,000,000.00.
P.Subcontractors. The Administrative Firm may hire subcontractors to perform any of the
services required of it under this Agreement and to act as its designee for purposes of this
Agreement.
III.Duties of Adopting Employer and Plan Administrator
A.Establishment & Plan Maintenance. Adopting Employer shall establish and maintain the
Plans. The Plan Administrator shall be responsible for the operation and administration of
the Plans. In accordance with this Agreement, Administrative Firm shall provide
Administrative Services to Adopting Employer and Plan Administrator in connection with
the operation and administration of the Plans.
B.Determination of Application of Continuation Laws. Adopting Employer shall have sole
responsibility for determining to which applicable laws requiring Continuation Coverage it
and its benefit plans are subject, including, but not limited to, whether it is entitled to the
small plan exemption available under COBRA. Adopting Employer shall notify
Administrative Firm if, after the Effective Date, the Continuation Coverage applicable to
the Plans changes.
C.Provision of Relevant Information. Adopting Employer shall provide to Administrative
Firm all relevant information, as determined by the Administrative Firm, necessary for
Administrative Firm to perform the Administrative Services required by this Addendum.
As part of the foregoing responsibility, within ten (10) days following the date on which
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Administrative Firm begins to provide services to Adopting Employer with respect to
Continuation Coverage, Adopting Employer shall provide to Administrative Firm a list of
all Continuation Participants and all Qualified Beneficiaries who have not yet become
Continuation Participants and the dates on which: (i) such individuals experienced
Qualifying Events, (ii) such individuals’ coverage under the Plan(s) ended, (iii) such
individuals were provided an election notice, if any, and (iv) such individuals elected
Continuation Coverage, if they have done so. Administrative Firm is entitled to rely upon
all information provided by Adopting Employer and is under no obligation to
independently verify such information.
D.Late Notification to Administrative Firm. Administrative Firm's responsibilities under this
Agreement are, in some cases, triggered upon the provision of relevant information by
Adopting Employer. If such information is not provided in a timely manner, Administrative
Firm shall use best efforts to quickly perform its responsibilities. However, ultimate
responsibility for any consequences, damages, penalties, and the like attributable in whole
or in part to the late notification to Administrative Firm remain with Adopting Employer.
For purposes of this provision, "timely" refers to a period of time specified in this
Agreement or, if not specified, the period of time reasonably sufficient for Administrative
Firm to perform its responsibilities within the time period required under applicable law.
E.Termination of Coverage. Upon the occurrence of an event triggering a loss of coverage
under the Plan, Adopting Employer shall be solely responsible for completing and
submitting to insurance carriers and/or third party service providers any documentation
required to terminate such Covered Individual's coverage under the Plan. Adopting
Employer shall also notify Administrative Firm of the event within thirty (30) days of the
event or of receipt of notification from a Qualified Beneficiary of the event.
F.Cost of Continuation Coverage. Adopting Employer shall provide Administrative Firm with
the Applicable Premium calculations for Continuation Coverage under each Plan at least
forty-five (45) days prior to the start of the twelve-month period to which they relate.
Administrative Firm shall be entitled to rely on such information.
G.Continuation Coverage Documents. Adopting Employer shall provide direction to
Administrative Firm, as necessary, regarding Continuation Coverage documentation.
Adopting Employer shall approve all such materials within thirty (30) days following
delivery by Administrative Firm, unless such deadline is extended by mutual agreement of
all parties. Adopting Employer's failure to object within such time period (including any
agreed upon extension period) shall constitute approval. Adopting Employer shall be solely
responsible for the content of Continuation Coverage documentation it has been provided
for review and approval.
H.Alternative Coverage. Adopting Employer must notify Administrative Firm of any
Alternative Coverage that impacts the services that would otherwise be provided by
Administrative Firm under this Agreement. If such Alternative Coverage increases the
amount of work Administrative Firm must perform to comply with this Agreement,
Administrative Firm reserves the right to charge additional administrative service fees
hereunder as agreed by the parties. Administrative Firm shall be entitled to rely on the
information provided by Adopting Employer.
I.Continuation Coverage Determinations. Through this Agreement, Adopting Employer
delegates to Administrative Firm authority to make the described determinations related
to Continuation Coverage under the Plans. If Adopting Employer disagrees with
Administrative Firm on a particular determination, Adopting Employer shall immediately
notify Administrative Firm, in writing, of such disagreement and direct Administrative
Firm regarding the situation. Adopting Employer shall be solely responsible for the final
determination of such a claim, which shall be communicated in writing to Administrative
Firm. Administrative Firm shall be entitled to rely on the final determination made by
Adopting Employer.
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J.Review of Reports. Adopting Employer shall review all reports provided by Administrative
Firm. Adopting Employer shall be solely responsible for comparing the information
contained in such reports with information provided by the insurance carriers and/or third
party service providers to confirm: (i) reinstatement of coverage for Qualified Beneficiaries
electing Continuation Coverage; and (ii) termination of Continuation Coverage for
Continuation Participants losing Continuation Coverage. Provided it has complied with its
responsibilities described in Sections II.H. and II.I., Administrative Firm shall have no
responsibility for ensuring insurance carriers and/or third party service providers properly
initiate Continuation Coverage for a Qualified Beneficiary electing such coverage or
properly terminate a Continuation Participant’s Continuation Coverage, as the case may
be.
K.FMLA Determinations. Adopting Employer shall make determinations regarding FMLA,
including, but not limited to, whether FMLA applies. Administrative Firm shall not make
determinations regarding FMLA. Furthermore, Administrative Firm shall be entitled to
rely upon the information provided by Adopting Employer and is under no obligation to
independently verify such information.
L.Continuation Law Compliance. Adopting Employer shall be solely responsible for
compliance with applicable law regarding the provision of Continuation Coverage (e.g.,
COBRA, USERRA, and state continuation laws) with respect to any plans sponsored the
Adopting Employer not specifically identified as a Plan for purposes of this Agreement.
M.Medical Child Support Order Compliance. Plan Administrator shall be solely responsible
for all aspects of compliance with applicable law regarding medical child support orders,
including, but not limited to, establishing procedures and determining whether a medical
child support order is valid. Plan Administrator shall provide notice to Administrative Firm
of any Covered Individuals covered under a Plan by virtue of a medical child support order
and of any Covered Individuals who cease to be covered under a Plan by virtue of the
expiration of a medical child support order. Administrative Firm shall be entitled to rely
upon the information provided by Plan Administrator pertaining to medical child support
order.
N.HIPAA Compliance. Adopting Employer and/or Plan Administrator (or their designees)
shall be responsible for all aspects of compliance with HIPAA, including, but not limited to
providing certificates of creditable coverage to Continuation Participants and notices of
privacy practices. Administrative Firm shall provide no services with respect to HIPAA
compliance unless required under another agreement for administrative services between
the parties.
O.Payment of Administrative Services Fees. In consideration of Administrative Firm’s
performance of the services described in this Agreement, Adopting Employer and/or Plan
Administrator shall pay Administrative Firm’s administrative fees as described in Exhibit
A.
1.Failure to Pay. Fees are due fifteen (15) days from receipt of the invoice. Any failure
to pay any such fees by the date upon which they are due may, at the Administrative
Firm’s option, result in the Administrative Firm’s (1) imposition of a late fee equal
to the lesser of (i) 1.5% of the outstanding balance, or (ii) the maximum amount
allowed by the usury laws of the applicable state, and/or (2) suspension of
performance of its services under this Agreement until such time as such fees are
paid or termination of this Agreement.
2.Fees for Additional Services. In the event additional adjustments that are not part
of the normal plan administrative services contemplate by this Agreement, or
chosen by Plan Administrator on Exhibit B, are required, Administrative Firm may
charge the Adopting Employer an additional fee commensurate with the additional
services provided. Administrative Firm will inform the Adopting Employer of the
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amount of the additional fee in advance of conducting the additional
administrative services.
P.Regulatory Compliance. Adopting Employer and Plan Administrator shall be responsible
for compliance with applicable laws and regulations pertaining to the Plans. Adopting
Employer and Plan Administrator shall be responsible for any and all governmental or
regulatory charges resulting from Adopting Employer's establishment and operation of the
Plans. This provision does not relieve Administrative Firm from any statutory or agency
requirements placed directly on it as a result of performing services under this Agreement.
Q.Plan Interpretation. Plan Administrator possesses and exercises ultimate authority and
responsibility for determining benefits under the Plan and making decisions regarding
eligibility for participation, termination of participation, and payment of benefits. This
authority and responsibility includes, but is not limited to, final review of Contribution
Coverage denials.
R.Other Information. Adopting Employer or Plan Administrator (including a designee) shall
comply with all requests for information made by Administrative Firm reasonably
necessary for Administrative Firm to fulfill its duties under this Agreement. Any
documentation received by Adopting Employer or Plan Administrator (including a
designee) that should have been provided to Administrative Firm shall be promptly
forwarded to Administrative Firm.
IV.Records & Information
A.Maintenance and Access. Administrative Firm and Plan Administrator shall maintain
adequate records relating to the terms and operation of the Plans for at least the Plan year
to which the records relate and for an eight (8) year period thereafter. Each party shall have
access to the records relating to the Plans maintained by the other party during normal
business hours and upon reasonable notice and request and subject to applicable laws and
regulations. The parties shall maintain the confidentiality of any information relating to
Covered Individuals and the Plans in accordance with applicable laws and regulations. At
the conclusion of the period for which records are required to be kept under this provision
and prior to any modification, destruction or disposal of any records, Administrative Firm
shall provide Plan Administrator an opportunity to review the records and obtain copies of
any such records. All costs associated with such inspection and copying of records will be
paid by Plan Administrator.
B.Record Use. Administrative Firm, Adopting Employer, and Plan Administrator agree that
the medical records, names, addresses, telephone numbers, Social Security numbers and
other personal information relating to Covered Individuals, which Administrative Firm
may obtain as a result of performing administrative services may be collected, maintained
and used by Administrative Firm and Plan Administrator as necessary to administer the
Plans. Administrative Firm and Plan Administrator may use patient specific and
individually identifiable information, as necessary to properly administer the Plans, to
defend any claim related to the Plans or to the provision of services under this Agreement,
or as otherwise may be permitted by state or federal law. All parties agree that such
information shall be considered confidential and protected as required under applicable
law.
C.Confidential Business Information. Administrative Firm, Adopting Employer, and Plan
Administrator shall each take all necessary steps to protect the other parties’ confidential
business information. Such information shall not be disclosed to third parties without the
express written consent of the other parties unless required by law or court order.
D.Transfer of Records. When this Agreement ends, Administrative Firm shall transfer to
Adopting Employer, Plan Administrator, and/or any successor administrator those records
Administrative Firm determines are reasonably necessary to effectuate a smooth transition
of administration of the Plans and any other records Administrative Firm possesses that
relate to the Plans. Administrative Firm intends that this transfer of records will satisfy its
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obligation to maintain such records as described above. Administrative Firm shall provide
Plan Administrator an opportunity to review the records and obtain copies of any such
records in addition to the records Administrative Firm has identified as necessary for a
smooth transition or otherwise transferred. The details of such transfer including, but not
limited to, the means, method and timing, shall be agreed to by the parties. All costs
associated with such a record review and transfer will be paid by Adopting Employer
and/or Plan Administrator.
E.HIPAA Business Associate. Administrative Firm acknowledges its role as a business
associate of certain Plans for purposes of the privacy and security standards under HIPAA.
Exhibit B reflects the business associate contractual requirements.
F.Nonpublic Data. MINNESOTA GOVERNMENT DATA PRACTICES ACT. Administrative
Firm must comply with the Minnesota Government Data Practices Act, Minnesota Statutes
Chapter 13, as it applies to (1) all data provided by the Adopting Employer pursuant to this
Agreement, and (2) all data, created, collected, received, stored, used, maintained, or
disseminated by Administrative Firm pursuant to this Agreement. Administrative Firm is
subject to all the provisions of the Minnesota Government Data Practices Act, including
but not limited to the civil remedies of Minnesota Statutes Section 13.08, as if it were a
government entity. In the event Administrative Firm receives a request to release data,
Administrative Firm must immediately notify Adopting Employer. Adopting Employer will
give Administrative Firm instructions concerning the release of the data to the requesting
party before the data is released. Administrative Firm agrees to defend, indemnify, and
hold Adopting Employer, its officials, officers, agents, employees, and volunteers harmless
from any claims resulting from Administrative Firm’s officers’, agents’, partners’,
employees’, volunteers’, assignees’ unlawful disclosure or use of protected data. The terms
of this paragraph shall survive the cancellation or termination of this agreement.
V.Indemnification and Limitation of Liability
A.Administrative Firm Indemnification. Administrative Firm agrees to indemnify and hold
harmless Employer and Plan Administrator from any and all claims, losses, and expenses
including, but not limited to, attorney's fees, incurred by Employer and/or Plan
Administrator as a result of Administrative Firm's (or Administrative Firm affiliated
company's) gross negligence, willful misconduct, fraud, criminal conduct, or breach of this
Agreement.
B.Limitation of Liability. In performing its obligations under this Agreement, Administrative
Firm neither assumes liability for nor otherwise agrees to underwrite the benefits provided
by the Plans. Except as otherwise provided herein, Administrative Firm shall have no duty
or obligation to defend any legal action or proceeding brought to recover, directly or
indirectly, a claim for benefits.
C.Reliance on Data & Direction. Notwithstanding any provision of this Agreement to the
contrary, Administrative Firm is not responsible or liable for any acts or omissions made
pursuant to any direction, consent, or other request reasonably believed by Administrative
Firm to be genuine and from an authorized representative of Employer or Plan
Administrator. Administrative Firm is not responsible or liable for acts or omissions made
in reliance on erroneous data provided by Employer or Plan Administrator to the extent
Administrative Firm's acts or omissions are attributable to the erroneous data, or for the
failure of Employer or Plan Administrator to perform their obligations under this
Agreement.
VI.Term and Termination
A.Term. This Agreement is effective as of the Effective Date hereinabove. Upon expiration of
the initial term (and each succeeding term), the Agreement shall automatically renew for
an additional term until the termination of this Agreement pursuant to this Section VI of
the Agreement.
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B.Termination. This Agreement may be terminated by either party at any time by written
notice of intention to terminate given to the other party to be effective as of a specified date
not less than sixty (60) days from the date such notice is received. Notwithstanding the
foregoing, in the event the Plan Administrator terminates this Agreement pursuant to this
Section VI.B. during any contract term for reasons other than termination for cause, as
described in Section VI.C. below, the Plan shall pay to the Administrative Firm such
transition reporting fees incurred by the Administrative Firm to transfer administration to
successor claims administrator.
C.Termination for Cause. Either party shall have the right to immediately terminate the
Agreement upon:
1.The material breach of the terms of this Agreement, by either the Administrative
Firm or the Adopting Employer, including failure to remit service fees due the
Administrative Firm, if such material breach is not corrected within ten (10) days
of receipt of written notice specifying the nature of the breach to the satisfaction of
the non-breaching party;
2.The bankruptcy or insolvency of Adopting Employer or the Administrative Firm;
or
3.The enactment of any law, promulgation of any regulation or action of any State or
Federal agency or authority which makes or declares illegal the continuance of this
Agreement or the performance of any of the services of the Administrative Firm
hereunder.
D.Post-Termination Obligations. Administrative Firm may, as mutually agreed upon by
Adopting Employer, Plan Administrator and Administrative Firm, provide certain
administrative services following the termination of this Agreement.
VII.Miscellaneous
A.Agreement Amendment. This Agreement may be amended only by mutual agreement in
writing executed by all parties, except that the Administrative Firm may amend this
Agreement to the extent necessary to comply with applicable federal, state or local laws or
regulations. Notwithstanding the foregoing, Administrative Firm may amend Exhibit A to
this Agreement by providing to Employer a copy of the amended Exhibit A at least sixty
(60)days before the end of a term, provided that if Employer provides written notice to
Administrative Firm of its objection to such amendment at least thirty (30) days prior to
the end of a term, such amendment shall not become effective and the Agreement shall
terminate at the end of the then current term. Notwithstanding the forgoing,
Administrative Firm may revise Exhibit A at any time if any change in the law or regulations
imposes upon Administrative Firm greater duties or obligations than are contemplated by
this Agreement.
B.Notices. All notices, requests, consents and other communications required or permitted
under this Agreement shall be in writing and delivered personally, or sent by registered or
certified mail or nationally recognized overnight carrier, postage prepaid, electronic
transmission, or by facsimile transmission, to the address set forth below, or to such other
address set forth in a notice given in the manner herein provided. All such notices, requests,
information or other communications shall be deemed to have been given (i) when
delivered if personally delivered, (ii) three business days after having been placed in the
mail, if delivered by registered or certified mail, (iii) the business day after having been
placed with a nationally recognized overnight carrier, if delivered by nationally recognized
overnight carrier, and (iv) the business day after transmittal by facsimile if transmitted
with electronic confirmation of receipt.
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If to Adopting Employer and Plan Administrator:
City of Lakeville
Attn: Tamara Schutta, Human Resources Manager
20195 Holyoke Avenue
Lakeville, MN 55044
If to the Administrative Firm:
121 Benefits
Attn: Linda Heuer, President
730 2nd Ave. S., Ste. 400
730 Building
Minneapolis, MN 55402
Phone: 612.877.4330
Fax: 612.877.4323
Upon the occurrence of a change in any of the above address information, each party shall
notify the other party(ies) of such change within five (5) business days of the effective date
of the change.
C.Severability. The provisions of this Agreement are severable. If any provision of this
Agreement is held invalid by a court of law or other tribunal, the invalidity of any provision
will not affect any other provision of this Agreement.
D.Survival. The rights and obligations described in Sections IV, V, and VI shall survive
termination of this Agreement.
E.No Waiver of Rights. Nothing in this Agreement shall be deemed to limit or abrogate any
right or remedy available under law. The failure of any party to insist upon the strict
observation or performance of any provision of this Agreement or to exercise any right or
remedy shall not impair or waive any such right or remedy.
F.Copyrighted Works. The Adopting Employer acknowledges that the Administrative Firm
and its agents are the sole copyright owners of all administrative guides and forms and all
other materials provided under the terms of this Agreement and that such material are
proprietary to the Administrative Firm. The Administrative Firm grants the Adopting
Employer a nonexclusive, nontransferable right to copy such materials provided such
copies are needed for the sole purpose of collecting and reporting information regarding
Covered Individuals or notifying Covered Individuals of information regarding the Plan.
Other materials provided by the Administrative Firm shall not be copied or reproduced by
the Adopting Employer without the Administrative Firm’s prior written consent.
G.Non-Assumption of Liabilities. Unless specifically provided in this Agreement, the parties
do not assume the existing or future obligations, liabilities or debts of the other party.
H.Entire Agreement. This Agreement shall supersede and replace any and all other
agreements between the parties relating to the same subject matter. This Agreement
contains the entire agreement and understanding of the parties relating to the subject
matter hereof, except as otherwise provided in this Agreement.
I.Governing Law. The Agreement shall be governed by and interpreted in accordance with
applicable federal law. To the extent the federal law does not govern, this Agreement shall
be governed by the laws of the State of Minnesota and the courts in such state shall have
sole and exclusive jurisdiction of any dispute related hereto and arising hereunder.
J.Independent Contractors. The Administrative Firm shall be construed to be acting as an
independent contractor and not as an employee of Adopting Employer or Plan
Administrator. The Administrative Firm, Adopting Employer and the Plan Administrator
shall not have the power or authority to act for or on behalf of, or to bind the other party,
except as set forth in this Agreement.
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K.Third Party Beneficiaries. The obligations of each party to this Agreement shall inure solely
to the benefit of the other signatory party(ies). Except as expressly provided in this
Agreement, no person or entity is intended to be or shall be construed or deemed to be a
third party beneficiary of this Agreement.
L.Successors and Assigns. This Agreement shall be binding on any successors, assigns and
subcontractors of the parties authorized under this Agreement.
M.Audit Rights. The parties agree to cooperate in all reasonable audits. Audit fees shall be
payable by the party initiating the audit. Audits shall be conducted using procedures
mutually agreed upon by the parties. Results of the audit may be shared with the party
being audited at the sole discretion of the party initiating the audit.
N.Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which taken together shall constitute one and the
same instrument.
O.Force Majeure. Neither party shall be liable for any delay or failure to perform its
obligations under this Agreement arising out of a cause beyond its control or without its
fault or negligence. Such causes may include, but are not limited to, fires, floods, and
natural disasters.
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IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of the
effective date indicated above.
ADOPTING EMPLOYER
By: _________________________________ Date: _________________________
Authorized Representative of
City of Lakeville
Its: Mayor
PLAN ADMINISTRATOR
By: _________________________________ Date: ________________________
Authorized Representative of
City of Lakeville
Its: City Clerk
By: _________________________________ Date: ________________________
Authorized Representative of
City of Lakeville
Its: Human Resources Manager
ADMINISTRATIVE FIRM
By: _________________________________ Date: ________________________
Authorized Representative of
DRT Benefits Corp. dba 121 Benefits
Its: President
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LIST OF EXHIBITS
A Administrative Fees
B Business Associate Agreement
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EXHIBIT A
Administrative Fees
January 1, 2021 – December 31, 2022
The Employer shall make payments of administrative service fees in accordance with the following
schedule:
COBRA Coverage Services Fees Paid by NFP Corporate Benefits
Administration Fee:
Continuees / Retirees $ 8.25 per Qualified Beneficiary / Retiree per
month 1
Qualifying Event Fee $ 17.75 per event 2
Monthly Minimum Fee $ 200.00
Optional Services
Initial New Hire General Notice $ 3.00 per Notice
Standard Open Enrollment Packets $ 5.00 per packet
Open Enrollment Packets $ 10.00 per packet;
if larger than standard business envelope
Data Management
Non-standard File Formatting and
Custom Reporting
$ 125.00 hourly rate
121 Benefits will retain the 2% COBRA administrative fee
1 There shall be a minimum Administration Fee of $200.00 per month.
2 Event is defined as the receipt by Administrative Firm of a notice of a qualifying event, regardless of the number of
qualified beneficiaries covered by such notice.
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EXHIBIT B
BUSINESS ASSOCIATE AGREEMENT
[amended for HITECH under ARRA]
This Business Associate Agreement (“Agreement”) is entered into by and between City of Lakeville
(“Covered Entity”) and DRT Benefits Corp. dba 121 Benefits, a Minnesota corporation (“Business Associate”) (each
a “Party” and collectively the “Parties”).
I.Purpose
The Parties have entered into an agreement for services dated ____ day of _______, 20__, a copy of
which is attached, through which Business Associate provides various services at the request of Covered
Entity (the “Services”)”. This Agreement is intended to constitute a “business associate” Agreement, as
required under the privacy and security provisions of the Health Insurance Portability and Accountability
Act of 1996 (“HIPAA”), as amended. The parties acknowledge that portions of HIPAA apply directly to
Business Associate as provided in the Heath Information Technology for Economic and Clinical Health Act
(“HITECH”). Business Associate’s obligations under this Agreement may be the same as, or in some cases
in addition to, Business Associate’s obligations under HIPAA.
II.Definitions
Unless otherwise defined herein, all capitalized terms in this Agreement shall have the same meaning as
provided under the Privacy Rule and/or Security Rule.
A.Effective Date – means January 1, 2021, unless specifically noted otherwise herein.
B.Electronic Protected Health Information (Electronic PHI) – shall have the same meaning as the
term “electronic protected health information” in 45 C.F.R. 160.103, limited to the information
created, received, or transmitted by Business Associate on behalf of Covered Entity.
C.Individual - shall have the same meaning as the term “individual” in 45 C.F.R. Section 160.103,
limited to individuals to whom Covered Entity provides coverage or services.
D.Privacy Rule – means the Standards and Privacy of Individually Identifiable Health Information at
45 C.F.R. Part 160 and Part 164, subparts A, D, and E and the privacy provisions of HIPAA, as
amended.
E.Protected Health Information (PHI) – shall have the same meaning as the term “protected health
information” in 45 C.F.R. 160.103, limited to the information created, received, or transmitted by
Business Associate on behalf of Covered Entity. PHI specifically includes Electronic PHI.
F.Secretary – means the Secretary of the Department of Health and Human Services or his/her
designee.
G.Security Incident – shall have the same meaning as the term “security incident” in 45 C.F.R.
Section 164.304, unless defined differently in Covered Entity’s policies and procedures for
compliance with the Security Rule, which shall be provided to the Business Associate.
H.Security Rule – means the Security Standards and Implementation Specifications at 45 C.F.R. Part
160 and Part 164, subpart C and the security provisions of HIPAA, as amended.
I.Standards for Electronic Transactions Rule - means the final regulations issued by the Department
Of Health and Human Services concerning standard transactions and code sets under the
Administrative Simplification provisions of HIPAA, 45 C.F.R. Part 160 and Part 162.
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III.Rights and Obligations of Business Associate
A.Uses and Disclosures by Business Associate.
1.Except as otherwise limited in this Agreement, Business Associate may use or disclose PHI
(i) to perform functions, activities, or services for, or on behalf of, Covered Entity pursuant
to any service agreement with the Business Associate, (ii) as permitted or required by this
Agreement, or (iii) as Required by Law. Business Associate may disclose PHI to other
Business Associates of Covered Entity, or to Business Associates of another Covered Entity
that is part of an organized health care arrangement that includes Covered Entity, to the
fullest extent allowed under applicable law.
2.Except as otherwise limited in this Agreement, Business Associate may use and disclose
PHI for the proper management and administration of its business or to carry out its legal
responsibilities to the extent allowed by the Privacy Rule and Security Rule.
3.Except as otherwise limited in this Agreement, Business Associate may use PHI to provide
Data Aggregation services to Covered Entity as permitted by 45 C.F.R. Section
164.504(e)(2)(i)(B).
4.Except as otherwise limited in this Agreement, Business Associate may use PHI to report
violations of law to appropriate Federal and State authorities, consistent with 45 C.F.R.
Section 164.502(j)(1).
5.Business Associate will limit its use, disclosure, or request of PHI to a Limited Data Set or
the minimum necessary amount in accordance with the Privacy Rule.
6.Except as otherwise authorized by the Privacy Rule, Business Associate shall not directly
or indirectly receive remuneration (whether financial or nonfinancial) in exchange for any
PHI of a Covered Individual. This paragraph shall apply to exchanges of PHI occurring on
or after the date that is six (6) months following the promulgation of final regulations
addressing the restriction on the sale of PHI.
7.Business Associate may not use or disclose PHI regarding a Covered Individual with
respect to a communication about a product or service that encourages recipients of the
communication to purchase or use the product or service except as authorized by the
Privacy Rule. This paragraph shall apply to exchanges of PHI occurring on or after the date
that is six (6) months following the promulgation of final regulations addressing the
restriction on the sale of PHI.
B.Additional Obligations of Business Associate.
1.Safeguards. Business Associate will implement administrative, physical and technical
safeguards to prevent the improper use of, disclosure of, and tampering with PHI and to
reasonably and appropriately protect the confidentiality, integrity, and availability of
Electronic PHI.
2.Reporting and Mitigation.
a. Business Associate shall immediately notify Covered Entity of each acquisition, access,
use, or disclosure of PHI of which it becomes aware that is made by Business
Associate, its employees, representatives, agents, or subcontractors and that is not
specifically permitted by this Agreement.
b.Business Associate shall notify Covered Entity of any Security Incident of which it
becomes aware. Business Associate shall provide such notification on a quarterly
basis, unless a more prompt notice is otherwise required by this Agreement (e.g.,
under Section III.B.2.a or Section III.B.9). With respect to Security Incidents that
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result from an unsuccessful attempt to access, use, disclose, modify, or destroy
Electronic PHI or interfere with system operations in an information system
containing Electronic PHI, the notification required hereunder need only report the
aggregate number of such incidents.
c.Business Associate agrees to promptly mitigate, to the extent practicable, any harmful
effect that is known to Business Associate of a use or disclosure in violation of this
Agreement or of a Security Incident.
3.Agents and Subcontractors. Business Associate will enter into a written contract with any
agent or subcontractor, who creates, receives, maintains, or transmits PHI or Electronic
PHI on behalf of Business Associate that requires such agent or subcontractor to comply
with the same restrictions and conditions that apply by and through this Agreement to
Business Associate with respect to such information.
4.Access to and Amendment of PHI. At Covered Entity’s direction or request, Business
Associate shall: (a) make PHI specified by Covered Entity maintained in a Designated
Record Set available to the individual(s) identified by Covered Entity as being entitled to
access and copy that PHI, and (b) make PHI maintained in a Designated Record Set
available to Covered Entity for the purpose of amendment and incorporating such
amendments into the PHI. Associate shall provide such access and incorporate such
amendments within ten (10) days of the request by the Covered Entity and in the manner
specified by Covered Entity. Effective September 23, 2013, if the Protected Health
Information requested by Covered Entity is maintained in a Designated Record Set
electronically, Business Associate shall make available, within the time period specified
above, a copy of such information in the electronic form and format specified by Covered
Entity, provided such information is readily producible in such form and format. If the
information is not readily producible in such form or format, Business Associate shall
make the information available in a readable electronic form and format as agreed to by
the parties.
In the event any Individual makes a request for access to or amendment of PHI directly to
Business Associate, Business Associate shall forward such request to Covered Entity within
five (5) days thereof. Notwithstanding anything herein to the contrary, Covered Entity
shall be ultimately responsible for (i) providing access to the requested PHI, (ii) making
the determination to deny access to requested PHI, (iii) determining whether the
requested amendment shall be made, and (iv) if the request for amendment is denied, in
whole or in part, complying with 45 C.F.R. Section 164.526.
5.Disclosure Accounting. Business Associate agrees to track disclosures of PHI, and
information related to such disclosures, as is necessary to enable Covered Entity to
respond to a request by an Individual for an accounting of disclosures of PHI in
accordance with 45 C.F.R. Section 164.528. Upon Covered Entity’s request, Business
Associate shall provide Covered Entity with an accounting of each disclosure of PHI made
by Business Associate or its employees, agents, representatives, or subcontractors with
respect to which Covered Entity is required to make an accounting under the Privacy Rule.
Any accounting provided by Business Associate under this section shall include: (a) the
date of the disclosure; (b) the name, and address if known, of the entity or person who
received the PHI; (c) a brief description of the PHI disclosed; and (d) a brief statement of
the purpose of the disclosure. In addition to the forgoing, Business Associate shall track
other disclosures and/or make available to Covered Entity such information as is
necessary for Covered Entity to comply with any additional accounting requirements
effective as of the compliance date applicable under final regulations implementing such
requirements. Notwithstanding anything herein to the contrary, Covered Entity shall be
ultimately responsible for providing the disclosure accounting to the Covered Individual.
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6.Policies and Procedures. As of the effective date of this replacement under HITECH (as
specified by the Secretary), Business Associate shall conduct a security risk assessment (in
accordance with 45 C.F.R. Section 164.306(b)(2)) and adopt and implement policies and
procedures as required under the Privacy Rule and/or the Security Rule.
7.Access to Business Associate’s Internal Records. Business Associate shall make its internal
practices, books, and records relating to the use and disclosure of PHI received from, or
created or received by Business Associate on behalf of, Covered Entity available to Covered
Entity or the Secretary, for the purposes of the Secretary’s determining compliance with
HIPAA. No attorney-client or other legal privilege will be deemed waived by Business
Associate or Covered Entity as a result of this section.
8.Electronic Transactions. In the event the Business Associate transmits or receives any
Covered Electronic Transaction on behalf of Covered Entity, it shall comply with all
applicable provisions of the Standards for Electronic Transactions Rule to the extent
Required by Law, and shall ensure that any agents and subcontractors that assist Business
Associate in conducting Covered Electronic Transactions on behalf of Covered Entity agree
in writing to comply with the Standards for Electronic Transactions Rule to the extent
Required by Law.
9.Breach Notifications. If Business Associate accesses, maintains, retains, modifies, records,
stores, destroys, or otherwise holds, uses, or discloses Unsecured PHI, Business Associate
shall notify Covered Entity, in accordance with the Privacy Rule, of a Breach of such
information without unreasonable delay, but no later than sixty (60) days following
discovery of the Breach.
C.Obligations and Rights of Covered Entity.
1.Notice of Privacy Practices. Covered Entity shall provide Business Associate with the
notice of privacy practices that Covered Entity produces in accordance with 45 C.F.R.
Section 164.520, as well as any changes to such notice.
2.Requests by Covered Entity. Covered Entity shall not request or direct Business Associate
to use or disclose PHI or Electronic PHI in any manner that would not be permissible
under the Privacy Rule or Security Rule if done by Covered Entity. To the extent a dispute
or difference of opinion exists between the Business Associate and Covered Entity
regarding whether a use or disclosure is permissible, Business Associate may disclose the
PHI under objection pursuant to the specific, written direction of Covered Entity. Any
disclosures made pursuant to such specific, written direction shall be subject to the
indemnification provisions of the Agreement.
3.Authorizations. Covered Entity shall notify Business Associate of any authorization
provided by an Individual to use or disclose PHI (and changes in or revocation of such an
authorization); to the extent that such information may affect Business Associate’s use or
disclosure of PHI. Upon receipt of such notification, Business Associate shall use or
disclose PHI in accordance with the authorization or changes thereto.
4.Restrictions. Covered Entity shall notify Business Associate of any restriction on the use or
disclosure of PHI to which Covered Entity has agreed in accordance with 45 C.F.R. Section
164.522 or is required to agree under HITECH (and any changes to or termination of such
a restriction), to the extent that such restriction may affect Business Associate’s use or
disclosure of PHI. Upon receipt of such notification, Business Associate shall comply with
such a restriction.
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IV.Term and Termination
A.Term. This Agreement will begin and become effective on the Effective Date and shall terminate as
provided in this Section IV.
B.Termination. Subject to Section IV.C.2, this Agreement may terminate as described below.
1.This Agreement shall terminate upon the completion of the Services, unless the Parties
thereafter continue a business relationship involving Business Associate’s use and
disclosure of PHI. In that event, this Agreement shall continue during the business
relationship.
2.In the event that a Party (the “non-breaching party”) discovers and determines that the
other Party (the “breaching party”) materially breached or violated any of its obligations
under this Agreement, the non-breaching party will notify the breaching party of such
breach in writing and may immediately terminate the Agreement upon notice to the
breaching party or may provide the breaching party with an opportunity to take reasonable
steps to cure the breach or end the violation, as applicable, within a mutually agreed upon
period of time. If the breaching party’s attempts to cure the breach or end the violation are
unsuccessful within that period, without limiting the rights of the Parties under the
Agreement, the non-breaching party may immediately terminate the Agreement upon
notice to the breaching party if feasible.
3.If Business Associate makes the determination that a material condition of performance
has changed with respect to the Services or this Agreement, including changes to HIPAA,
Business Associate may terminate this Agreement upon (30) days notice to Covered
Entity. Business Associate agrees, however, to cooperate with Covered Entity to find a
mutually satisfactory resolution to the matter prior to terminating.
C.Effect of Termination. Upon termination of the Agreement, for any reason, Business Associate
shall retain all Protected Health Information created or received by it on behalf of Covered Entity.
Business Associate shall retain such Protected Health Information for the purpose of responding to
inquiries from Covered Entity, Participants, or beneficiaries made following termination of the
Agreement and for record retention purposes. The parties acknowledge that it is infeasible for
Business Associate to return or destroy such Protected Health Information for these reasons.
Business Associate will extend the protections of this Agreement to such Protected Health
Information and limit further uses and disclosures of such Protected Health Information to that
purpose, for so long as Business Associate maintains such Protected Health Information.
V.General Provisions
A.Regulatory References. A reference in this Agreement to a section in the Privacy Rule or the
Security Rule means the section as in effect or as amended.
B.Amendment. The Parties agree to take such action as is necessary to amend this Agreement from
time to time as is necessary for Covered Entity to comply with the requirements of the Privacy
Rule, the Security Rule, and the Health Insurance Portability and Accountability Act of 1996, Pub.
L. No. 104-191.
C.Interpretation. Any ambiguity in this Agreement shall be resolved to permit each Party to comply
with the Privacy Rule and the Security Rule.
D.Survival. The respective rights and obligations of Business Associate and Covered Entity under this
Agreement shall survive the termination of this Agreement and any related services agreement.
E.Indemnity. Each Party will indemnify, hold harmless, and defend the other Party and its affiliates,
officers, directors, employees or agents from and against any claim, cause of action, liability,
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damage, cost or expense, including attorneys’ fees and court or proceeding costs, arising out of or
in connection with any non-permitted or violating use or disclosure of PHI or other breach of this
Agreement by such Party or any subcontractor, agent, person or entity under such Party’s control.
F.No Third Party Beneficiaries. Nothing express or implied in this Agreement is intended to confer,
nor shall anything herein confer, upon any person other than the Parties hereto, any rights
obligations, or liabilities whatsoever.
G.Conformance with Law. The Parties agree to take such action as is necessary to amend this
Agreement from time to time as is necessary for the Parties to comply with the requirements of
HIPAA.
H.Notices. All notices, required or permitted by either party shall be in writing and shall be
sufficiently given and served if personally delivered or sent by U.S. mail, postage prepaid and
addressed to either party at the addresses designated below, or to such other place as either party
may, from time to time, designate in writing to the other. Any such notice shall be deemed to have
been given, if mailed as provided herein, as of the date mailed.
City of Lakeville
Attn: Tamara Schutta, Human Resources Manager
20195 Holyoke Avenue
Lakeville, MN 55044
121 Benefits
Attn: Linda Heuer, President
730 2nd Ave. S., Ste. 400
730 Building
Minneapolis, MN 55402
Phone: 612.877.4330
Fax: 612.877.4323
I.No Exclusion. Covered Entity represents that it has not, and Business Associate represents that
neither it nor any of its employees, independent contractors or agents who will be working on the
subject matter of this Agreement have been, excluded from participation in any federal or state
Medicare, Medicaid, or any other third party payor program, nor is any such action pending. Each
Party shall each immediately notify the other Party when it learns if such action is threatened,
proposed or taken. If at any time either Covered Entity or Business Associate (or any of its
employees, independent contractors or agents who will be working on the subject matter of this
Agreement) are excluded, as described above, then the other Party may immediately terminate this
Agreement.
J.Governing Law. This Agreement shall be governed by the law of Minnesota, except to the extent
preempted by federal law.
K.Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect
the validity or enforceability of any other provision of this Agreement, which shall remain in full
force and effect.
L.Entire Agreement. This Agreement constitutes the entire agreement between the parties with
respect to its subject matter and constitutes and supersedes all prior agreements, representations
and understandings of the parties, written or oral, with regard to this same subject matter.
Notwithstanding the foregoing, this Agreement is intended to supplement (rather than supersede)
the agreement between Business Associate and the sponsor of the Covered Entity related to the
services that Business Associate provides with respect to administration of the Covered Entity.
M.Counterparts. This Agreement may be executed in counterparts, each of which so executed shall be
construed to be an original, but all of which together shall constitute one agreement binding on all
parties, notwithstanding that all parties are not signatories to the same counterpart. Transmission
by facsimile or electronic mail of an executed counterpart of this Agreement shall be deemed to
constitute due and sufficient delivery of such counterpart. This Agreement and any amendment or
modification may not be denied legal effect or enforceability solely because it is in electronic form,
or because an electronic signature or electronic record was used in its formation.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement to be effective as of the
effective date indicated above.
ADOPTING EMPLOYER
By: _________________________________ Date: _________________________
Authorized Representative of
City of Lakeville
Its: Mayor
PLAN ADMINISTRATOR
By: _________________________________ Date: ________________________
Authorized Representative of
City of Lakeville
Its: City Clerk
By: _________________________________ Date: ________________________
Authorized Representative of
City of Lakeville
Its: Human Resources Manager
ADMINISTRATIVE FIRM
By: _________________________________ Date: ________________________
Authorized Representative of
DRT Benefits Corp. dba 121 Benefits
Its: President
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121 Benefits
730 2nd Ave. S., Ste 400
730 Building
Minneapolis, MN 55402
September 17, 2020
City of Lakeville
20195 Holyoke Ave.
Lakeville, MN 55044
Re: DRT Benefits Corp. dba 121 Benefits - COBRA Administration Services
Dear City of Lakeville:
In addition to the basic insurance placement or service activities that NFP Corporate Benefits (“NFP”)
provides to City of Lakeville (“the City”), the City has chosen to engage DRT Benefits Corp. dba 121
Benefits (“121 Benefits”) to provide the City with COBRA Administration Services (“Services”). This letter
agreement (“Agreement”) confirms the understanding of NFP and the City that NFP agrees to pay the cost
of the Services as set forth on the attached Exhibit A, upon the following terms:
•Upon receipt by NFP of 121 Benefit’s monthly invoice, NFP agrees to pay the cost of the
Services set forth in Exhibit A.
•NFP agrees to pay the cost of the Services on behalf of the City so long as NFP is named
the Broker of Record for all of the lines of insurance coverage placed by NFP for the City
as of the date of this Agreement.
•Any nonpayment by NFP of 121 Benefit’s invoice shall not relieve the City from remitting
any payments due to 121 Benefits for the Services as the City understands and agrees that
it is ultimately responsible for the payment of the cost of the Services.
Upon termination by the City of NFP as its Broker of Record for any line of coverage, NFP shall have no
further obligation to pay the cost of the Services and the City may continue to receive the Services under
terms negotiated directly with 121 Benefits.
Nothing in this Agreement shall affect the terms and conditions of any agreement to which the City and
121 Benefits are parties, nor the obligations of those parties under any agreement.
Please sign and return a copy of this Agreement, acknowledging your acceptance of its terms.
Sincerely, Acknowledged and Agreed on behalf of
City of Lakeville
Signed by:
Linda Heuer, President Print Name
Date
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EXHIBIT A
Administrative Fees
January 1, 2021 – December 31, 2022
The Employer shall make payments of administrative service fees in accordance with the
following schedule:
COBRA Coverage Services Fees Paid by NFP Corporate Benefits
Administration Fee:
Continuees / Retirees $ 8.25 per Qualified Beneficiary / Retiree per month 1
Qualifying Event Fee $ 17.75 per event 2
Monthly Minimum Fee $ 200.00
Optional Services
Initial New Hire General Notice $ 3.00 per Notice
Standard Open Enrollment Packets $ 5.00 per packet
Open Enrollment Packets $ 10.00 per packet;
if larger than a standard business envelope
121 Benefits will retain the 2% COBRA administrative fee
1 There shall be a minimum Administration Fee of $200.00 per month.
2 Event is defined as the receipt by Administrative Firm of a notice of a qualifying event, regardless of the number of
qualified beneficiaries covered by such notice.
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