ADMINISTRATIVE REPORT
MEETING DATE: May 27, 2026 AGENDA CATEGORY: Consent - Agreements TO: Honorable Mayor and City Council
FROM: Jena Covey, Risk Manager
DATE: May 27, 2026
SUBJECT: Agreement with Allied Managed Care, Inc. (AMC) (not to exceed $3,500,000) for Workers’ Compensation Bill Review Services
RECOMMENDATION:
Staff recommends approval of agreement.
BACKGROUND:
Medical facilities operate under different fee schedules depending on the type of patient they serve, including individuals covered by workers’ compensation, Medicare, or private insurance. In California, the workers’ compensation system establishes an off icial medical fee schedule that governs most services, while certain treatments fall outside the schedule and require providers to negotiate rates based on usual and customary charges. The City processes medical bills as part of administering its workers’ compensation program.
The City utilizes a bill review company to verify the accuracy of medical fees and maximize savings for medical services incurred as part of the City’s workers’ compensation program. The bill review company also secures additional savings when available by applying discounts through preferred provider networks and negotiating rates for specialized bills that fall outside the State’s fee schedule or network agreements.
Overall, the use of a bill review service leads to net savings by reducing workers’ compensation medical expenses.
In January 2026, a Request for Proposal (RFP) was issued, and the City received nine proposals from interested companies. As part of the RFP process, interested companies were requested to review medical services by processing three sample bills in accordance with the fee schedule proposed by each company.
Of the nine companies solicited, responses were received from eight companies.
While all company responses were thoroughly reviewed, based on the prici ng structure, opportunity for savings, negotiated fees owed to medical providers, and access to preferred provider networks, Allied Managed Care, Inc. (AMC) was selected as the most qualified to provide bill review services for the City’s workers’ compensation
program. The company’s proposed fee schedule, including negotiated Preferred Provider Organization (PPO) reductions and per-bill charges, resulted in overall costs lower than those submitted by the other respondents. In addition, the City will incur no cost to access AMC’s Medical Provider Network (MPN), a list of physicians and specialties doctors, which would typically require a fee. The City currently utilizes AMC for both Utilization Review (UR) and Bill Review services. Continuing with the same provider for both services will maintain system efficiency, support effective claims monitoring, and reduce redundancy, which may result in additional cost savings for the City.
FISCAL IMPACT:
Based on the above, staff recommends approval of an agreement with AMC for five years, with a not to exceed amount of $3,500,000. Cost associated with this agreement are funded annually through the Risk Management Division Budget.
COUNCIL GOAL:
Innovative and Efficient City Government
ATTACHMENTS:
1. Allied Managed Care Proposal
2. Certificate of Insurance
3. Bill Review RFP
4. Agreement
5. Cost Proposal