____________________________________________________________________________________
FOR CITY CLERK ONLY
Council Meeting: _______________________
Disposition: ___________________________
Agenda Item No: 2.f
Meeting Date: May 4, 2026
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Human Resources
Prepared by: Marissa Sanchez,
Human Resources Director
City Manager Approval: ______________
TOPIC: WORKERS’ COMPENSATION CLAIMS MANAGEMENT SERVICES SUBJECT: RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A
PROFESSIONAL SERVICES AGREEMENT WITH INTERCARE HOLDINGS INSURANCE SERVICES, INC. FOR WORKERS’ COMPENSATION THIRD-PARTY CLAIMS ADMINISTRATION SERVICES IN AN AMOUNT NOT TO EXCEED $1,418,757
AND AUTHORIZING THE CITY MANAGER TO EXECUTE ALL NECESSARY AND
INCIDENTAL DOCUMENTS
RECOMMENDATION:
Staff recommend that the City Council:
1. Adopt a Resolution Authorizing the City Manager to Execute Professional Services Agreement with Intercare Holdings Insurance Services, Inc. for workers’ compensation Third-Party Claims Administration (TPA) services for the period of July 1, 2026 through June 30, 2031, in an amount not-to-exceed $1,418,757 (including optional years and one-time costs); and
2. Authorize the City Manager to execute all necessary and incidental documents.
BACKGROUND:
The City of San Rafael is self-insured for workers’ compensation and utilizes the services of a Third-Party Claims Administrator (TPA) to adjust workers’ compensation claims. The City has been legally selfinsured for primary workers’ compensation insurance since December 1, 1976 and maintains excess insurance coverage through Safety National for losses exceeding the City’s $1 million self-insured retention since July 1, 2009.
As a self-insured public agency, the City is responsible for administering all aspects of its workers’ compensation program, including claims investigation, compensability determinations, medical management, litigation coordination, and regulatory compliance. Due to the specialized and technical nature of these services, the City has historically relied on a qualified TPA to manage claims efficiently and in accordance with California law.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
The City’s current Professional Services Agreement with its existing TPA, LWP Claims Solutions, Inc. (LWP), expires on June 30, 2026. After the City’s approximately eight-year partnership with LWP, staff decided to evaluate our options with other service providers to ensure we are getting the best service for all employees. Additionally, staff has had some concerns with how claims have been handled and inconsistent service delivery overall. Given the duration and persistence of these issues, staff determined that a change in TPA services was necessary to ensure a higher level of service, improved claims outcomes, and a better experience for injured employees.
In preparation for the expiration of the current agreement, staff evaluated options for continued claims administration services, including available vendors with demonstrated expertise in public sector workers’ compensation programs. While competitive solicitations such as Requests for Proposals (RFPs) are encouraged when feasible, they are not required for professional services under the San Rafael Municipal Code. Specifically, San Rafael Municipal Code (SRMC) Section 2.55.020(d) defines professional services as those performed by individuals or firms possessing a high degree of technical skill or expertise. Additionally, SRMC Section 2.55.100(D) provides that competitive bidding is not required for the procurement of professional services, provided that the City selects a vendor based on demonstrated competence and professional qualifications necessary for satisfactory performance.
Consistent with this guidance, and in consultation with the City Attorney’s Office, staff determined that a formal RFP process was not required for the procurement of workers’ compensation claims administration services. Instead, staff conducted a qualifications-based evaluation of potential providers, focusing on experience with public agencies, service delivery model, staffing approach, technology capabilities, and cost structure. Additionally, staff consulted with department directors who have high levels of workers’ compensation claims to get their support and buy-in.
Through this evaluation process, Intercare Holdings Insurance Services, Inc. (“Intercare”) was identified as the most qualified provider. Intercare demonstrated extensive experience administering workers’ compensation programs for California public agencies, a strong claims management approach, and the ability to provide comprehensive services aligned with the City’s operational needs.
Intercare is owned by the same parent company, Avon Risk Company, as George Hills, who the City uses for our Liability Third-Party Administrator. This would allow the City to streamline Risk Management processes by having one account manager over both types of claims. This would allow for improvement in risk reporting and tracking of risk financing.
Based on this evaluation, staff recommends entering into a Professional Services Agreement with Intercare to provide workers’ compensation Third-Party Claims Administration services beginning July 1, 2026.
ANALYSIS:
Workers’ compensation claims administration is a highly technical function that requires expertise in California labor law, medical management, claims adjusting, and litigation coordination. TPAs provide dedicated professional staff, systems, and processes designed to efficiently manage claims and control costs.
Intercare’s proposed services include:
• Full claims administration and adjustment services
• Investigation and compensability determinations
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
• Medical management and utilization review
• Litigation management and coordination with defense counsel • Fraud detection and special investigations
• Claims reserving and financial management
• Regulatory reporting and compliance
• Data analytics and reporting tools
The proposed agreement includes a structured staffing model to maintain manageable caseloads and ensure timely handling of claims. Intercare will also provide a risk management information system (RMIS) for tracking claims, generating reports, and supporting actuarial and audit needs.
The initial three-year cost for claims administration services is:
• Year 1 (FY 2026-27): $264,571.84
• Year 2 (FY 2027-28): $273,831.85
• Year 3 (FY 2028-29): $283,415.97
Optional extension years include:
• Year 4: $293,335.53
• Year 5: $303,602.27
A one-time data conversion fee of $10,000 is required to transition existing claim files into Intercare’s system. This is a slight increase from the prior TPA, however, the services provided are more robust and we are predicting to offset this cost with a quicker return to work rate and less spent on medical expenses because claims will be closed out quicker.
In addition, managed care and ancillary services will be billed on a per-use basis and charged directly to claim files as allocated loss adjustment expenses (ALAE).
Transition to Intercare is expected to take approximately 60 days and will include data migration, system setup, and coordination with existing stakeholders to ensure continuity of claims handling.
Overall, transitioning to Intercare Holdings Insurance Services, Inc. for TPA services is expected to:
• Improve claims handling consistency and timeliness
• Reduce long-term claim costs through proactive management • Ensure compliance with evolving legal requirements
• Provide enhanced reporting and transparency
FISCAL IMPACT:
The total cost of the proposed agreement over the initial three-year term is approximately $821,820, with a total not-to-exceed amount of $1,418,757 if all option years are exercised, inclusive of the one-time data conversion fee.
Funding for workers’ compensation claims administration services is included in the City’s Workers’ Compensation Internal Service Fund. Managed care and ancillary costs will be allocated directly to individual claim expenses.
As an internal service fund, funding is provided through internal service charges assessed on a prorated basis to each of the City’s operating departments based on historical workers’ compensation claims.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 4
Roughly 80% of the annual charges assessed through the Workers’ Compensation Internal Service Fund are borne by the City’s General Fund.
This approach provides predictable annual administrative costs while allowing flexibility based on actual claims activity.
OPTIONS:
The City Council has the following options to consider in this matter:
1. Approve staff’s recommended action to enter into an agreement with Intercare for workers’ compensation claims administration services.
2. Adopt the resolution with modifications, such as adjusting contract terms or scope of services.
3. Direct staff to return with additional information or alternative options.
4. Take no action, and continue with the City’s current approach to administering workers’ compensation claims.
Staff recommends Option 1 as it provides the most efficient and cost-effective approach to managing the City’s workers’ compensation program.
RECOMMENDED ACTION:
Staff recommend that the City Council:
1. Adopt a Resolution Authorizing the City Manager to Execute Professional Services Agreement with Intercare Holdings Insurance Services, Inc. for workers’ compensation Third-Party Claims Administration (TPA) services for the period of July 1, 2026 through June 30, 2031, in an amount not-to-exceed $1,418,757 (including optional years and one-time costs); and
2. Authorize the City Manager to execute all necessary and incidental documents.
ATTACHMENTS:
1. Professional Services Agreement with Intercare Holdings Insurance Services, Inc.
2. Resolution
v. April 1, 2026 Page-1
CITY OF SAN RAFAEL
PROFESSIONAL SERVICES AGREEMENT
This Professional Services Agreement (“Contract”) is entered into by and between the City of San Rafael (“City”) and __________________________________________ (“Contractor”), a __________________________________________________ for __________________________________________________________, and is effective on _____________________ (“Effective Date”). City and Contractor may be referred to individually as a “Party” or collectively as the “Parties” or the “Parties to this Contract.”
RECITALS
A. City desires to secure professional services more fully described in this Contract, at Exhibit A, entitled “SCOPE OF WORK”; and
B. Contractor represents that it, and its subcontractors, if any, have the professional qualifications, expertise, and necessary licenses and desire to provide certain goods and/or required services of the quality and type which meet objectives and requirements of City; and
C. Contractor acknowledges that the execution of this Contract by the City is predicated upon the representations made in Contractor’s proposal dated _________________ submitted to the City; and
D. The Parties have specified herein the terms and conditions under which such services will be provided and paid for.
NOW, THEREFORE, the parties hereby agree as follows:
CONTRACT
1. WORK TO BE PERFORMED.
Except as otherwise may be expressly specified in this Contract, Contractor shall furnish all technical and professional services, including labor, material, equipment, transportation, supervision and expertise (collectively referred to as “Services”) to satisfactorily complete the work required by City at its sole risk and expense. Services to be provided to City are more fully described in Exhibit A entitled “SCOPE OF WORK.”. v. April 1, 2026 Page-2
2. COMPENSATION.
In consideration for Contractor’s complete performance of the Scope of Work, City will pay Contractor in accordance with the rates and/or prices set forth in Exhibit A, up to the not-to-exceed amount of $_____________. Contractor shall not increase its rates throughout the Term of this Contract, except that upon 60 day written notice, Contractor may adjust its rates no more than once annually at a maximum amount equal to the percentage change through December in the prior calendar year to the consumer price index (“CPI”) for California, All Urban Consumers, San Francisco-Oakland-San Jose areas, not to exceed five percent (5%).
Contractor will bill City on a monthly basis for work performed by Contractor during the preceding month, subject to verification by City. City will pay Contractor within thirty (30) days of City’s receipt of invoice.
3. TERM OF CONTRACT.
This Contract becomes effective upon the date listed as "Effective Date" and shall remain in effect until the completion of all obligations of both Parties hereto, or ___________________________________, whichever comes first, unless terminated or amended as provided herein.
4. RELIANCE ON PROFESSIONAL SKILL OF CONTRACTOR.
Contractor represents that it has the necessary professional skills to perform the work required and the City shall rely on such skills of the Contractor to do and perform the work. In performing the work hereunder Contractor shall adhere to the standards generally prevailing for the performance of expert consulting services similar to those to be performed by Contractor hereunder.
Contractor represents that it has reviewed Exhibit A and that in its professional judgment the work to be performed under this Contract can be performed for a fee within the maximum amount set forth herein and within the times specified.
Contractor represents that it possesses all necessary training, licenses and permits to perform the Scope of Work and that its performance of the Scope of Work will conform to the standards of practice of a professional having experience and expertise in performing professional services of like nature and complexity of the Scope of Work working on similar, successfully completed projects.
The granting of any progress payment by City, or the receipt thereof by Contractor, or any inspection, review, approval or oral statement by any representative of City or any other governmental entity, shall in no way waive or limit the obligations in this Paragraph 4 or lessen the liability of Contractor for unsatisfactory work, including but not limited to cases where the defective or below standard work may not have been v. April 1, 2026 Page-3
apparent or detected at the time of such payment, inspection, review or approval.
5. PROJECT COORDINATION.
A. City’s Project Manager. ________________________________ is hereby designated the Project Manager for the City and said Project Manager shall supervise all aspects of the progress and execution of this Contract.
B. Contractor’s Project Director. Contractor shall assign a single Project Director to have overall responsibility for the progress and execution of this Contract for Contractor. ___________________________________ is hereby designated as the Project Director for Contractor. Should circumstances or conditions subsequent to the execution of this Contract require a substitute Project Director, for any reason, the Contractor shall notify the City within ten (10) business days of the substitution.
6. TERMINATION.
A. The term of this Contract shall commence upon the date hereinabove written and shall expire upon completion of performance of work hereunder by Contractor.
B. Notwithstanding the provisions of (A) above, City may with or without cause, direct Contractor to suspend, delay or interrupt the work, in whole or in part, for such periods of time as City may determine in its sole discretion.
C. City may terminate this Contract in whole, or from time to time in part, for default, should Contractor commit a material breach of this Contract, or part thereof, and not cure such breach within ten (10) calendar days of the date of City’s written notice to Contractor demanding such cure, in which case Contractor shall be liable to City for all loss, cost, expense, damage and liability resulting from such breach and termination.
D. City may terminate this Contract in whole, or from time to time in part, for convenience, whenever City determines that such termination is in City’s best interests, in which case Contractor shall be entitled to recover its costs expended up to the termination date plus reasonable profit thereon to the termination date as this Contract would otherwise provide, but may recover no other cost, damage or expense. Contractor shall continue its work throughout the course of any dispute, and Contractor’s failure to continue work during a dispute shall be a material breach of this Contract.
E. Lack of Appropriation: If this Contract is a multi-year contract, subject to appropriation each fiscal year, the City may terminate this Contract immediately for lack of appropriation of funds.
F. Effect of Termination. Upon receipt of notice of termination, neither party shall incur additional obligations under any provision of this Contract without the prior written consent of the other.
v. April 1, 2026 Page-4
G. Return of Documents. Upon termination, any and all City documents or materials provided to Contractor and any and all of Contractor's documents and materials prepared for or relating to the performance of its duties under this Contract, shall be delivered to City as soon as possible, but not later than thirty (30) days after termination.
7. INSURANCE REQUIREMENTS.
During the term of this Contract, and for any time period set forth in Exhibit B, Contractor shall procure and maintain in full force and effect, at no cost to City insurance policies with respect to employees and vehicles assigned to the performance of work under this Contract with coverage amounts, required endorsements, certificates of insurance, and coverage verifications as defined in Exhibit B. 8. INDEMNIFICATION.
A. Except as otherwise provided in subparagraph B of this section, Contractor shall, to the fullest extent permitted by law, indemnify, release, defend with counsel approved by City, and hold harmless City, its officers, agents, employees and volunteers (collectively, the “City Indemnitees”), from and against any claim, demand, suit, judgment, loss, liability or expense of any kind, including but not limited to attorney's fees, expert fees and all other costs and fees of litigation, (collectively “CLAIMS”), arising out of Contractor’s performance of its obligations or conduct of its operations under this Contract. The Contractor's obligations apply regardless of whether or not a liability is caused or contributed to by the active or passive negligence of the City Indemnitees. However, to the extent that liability is caused by the active negligence or willful misconduct of the City Indemnitees, the Contractor's indemnification obligation shall be reduced in proportion to the City Indemnitees’ share of liability for the active negligence or willful misconduct. In addition, the acceptance or approval of the Contractor’s work or work product by the City or any of its directors, officers or employees shall not relieve or reduce the Contractor’s indemnification obligations. In the event the City Indemnitees are made a party to any action, lawsuit, or other adversarial proceeding arising from Contractor’s performance of or operations under this Contract, Contractor shall provide a defense to the City Indemnitees or at City’s option reimburse the City Indemnitees their costs of defense, including reasonable attorneys’ fees, incurred in defense of such claims.
B. Where the work to be performed by Contractor under this Contract are design professional services to be performed by a design professional as that term is defined under Civil Code Section 2782.8, then, to the extent permitted by law including without limitation, Civil Code sections 2782, 2782.6 and 2782.8, Contractor shall indemnify and hold harmless the City and its officers, officials, and employees (collectively City Indemnitees) from and against damages, liabilities or costs (including incidental damages, Court costs, reasonable attorney’s fees as may be determined by the Court, litigation expenses and fees of expert witnesses incurred in connection therewith and costs of investigation) to the extent they are caused by the negligence, v. April 1, 2026 Page-5
recklessness, or willful misconduct of Contractor, or any sub Contractors, or subcontractor or anyone directly or indirectly employed by them, or anyone for whom they are legally liable (collectively Liabilities). Such obligation to hold harmless and indemnify any indemnity shall not apply to the extent that such Liabilities are caused in part by the negligence or willful misconduct of such City Indemnitee.
C. The defense and indemnification obligations of this Contract are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained in this Contract and shall survive the termination or completion of this Contract for the full period of time allowed by law.
9. PREVAILING WAGE.
If the work to be performed under this Contract is for services where prevailing wages are required by State law, Contractor shall pay prevailing wages to its employees on any contract in excess of $1,000.00, Copies of the general prevailing rates of per diem wages for each craft, classification, or type of worker needed to execute the Contract, as determined by Director of the State of California Department of Industrial Relations, are on file at the City’s Public Works Department upon request and may be obtained from the California Department of Industrial Relations website
[http://www.dir.ca.gov/OPRL/DPreWageDetermination.htm]. Contractor shall comply with the 8-hours per day/40 hours per week/overtime/working hours restrictions for all employees, pursuant to the California Labor Code. Contractor and all subcontractors shall keep and maintain accurate employee payroll records for Work performed under the Contract. The payroll records shall be certified and submitted as required by law, including Labor Code Sections 1771.4 (if applicable) and 1776, including to the Labor Commissioner no less frequently than monthly. Contractor shall comply fully with Labor Code Section 1777.5 in the hiring of apprentices for work relating to the Contract.
10. NOTICES.
All notices and other communications required or permitted to be given under this Contract, including any notice of change of address, shall be in writing and given by email, personal delivery, or deposited with the United States Postal Service, postage prepaid, addressed to the parties intended to be notified. Notice shall be deemed given as of the date of email, personal delivery, or if mailed, upon the date of deposit with the United States Postal Service. Notice shall be given as follows:
To City’s Project Manager: ___________________________ ___________________________ San Rafael, CA 94901 Email: ______________________ To Contractor’s Project Director: ___________________________ ___________________________ ___________________________ Email: ______________________ v. April 1, 2026 Page-6
11. LIABILITY OF CITY.
Except as provided in Exhibit A, Scope of Work to be Provided by Contractor and Exhibit B, Insurance, City's obligations under this Contract shall be limited to the payment of the compensation provided for in Paragraphs 1 and 2 of this Contract, Notwithstanding any other provision of this Contract, in no event shall City be liable, regardless of whether any claim is based on contract, tort or otherwise, for any special, consequential, indirect or incidental damages, lost profits or revenue, arising out of or in connection with this Contract, the Scope of Work, or the Project.
City shall not be responsible for any damage to persons or property as a result of the use, misuse or failure of any equipment used by Contractor, or by any of its employees, even though such equipment be furnished, rented or loaned to Contractor by City. The acceptance or use of such equipment by Contractor or any of its employees shall be construed to mean that Contractor accepts full responsibility for and shall exonerate, indemnify, defend and save harmless City from and against any and all claims for any damage or injury of any type, including attorneys' fees, arising from the use, misuse or failure of such equipment, whether such damage be to the Contractor, its employees, City employees or third parties, or to property belonging to any of the above.
Nothing in this Contract shall constitute a waiver or limitation of any right or remedy, whether in equity or at law, which City or Contractor may have under this Contract or any applicable law. All rights and remedies of City or Contractor, whether under this Contract or other applicable law, shall be cumulative.
12. MEDIATION.
Unless waived by the City, should any dispute arise out of this Contract, the parties shall meet in mediation and attempt to reach a resolution with the assistance of a mutually acceptable mediator. Unless the City waives this requirement, Contractor shall not be permitted to file legal action without first meeting in mediation and making a good faith attempt to reach a mediated resolution. The costs of the mediator, if any, shall be paid equally by the parties. If a mediated settlement is reached neither party shall be deemed the prevailing party for purposes of the settlement and each party shall bear its own legal costs.
13. GENERAL TERMS AND CONDITIONS.
This Contract includes, and the Contractor agrees to comply with the City’s General Terms and Conditions, which are set forth in Exhibit C, attached hereto and incorporated by reference.
[Signatures are on the following page.]
v. April 1, 2026 Page-7
IN WITNESS WHEREOF, the parties have executed this Contract as of the day, month and year first above written.
CITY OF SAN RAFAEL: _________________________________
________________________________, _________________________________ Executed on:_______________________ APPROVED AS TO FORM:
Office of the City Attorney _________________________________ ________________________________, _________________________________ ATTEST:
City Clerk _________________________________
________________________________, _________________________________ CONTRACTOR: __________________________________ By: ____________________________ Name: ____________________________
Title: ____________________________
[If Contractor is a corporation, second
corporate officer signature required] __________________________________ By: ____________________________ Name: ____________________________
Title: _____________________________
EXHIBIT A
SCOPE OF WORK
This is an Exhibit attached to, and made a part of the Contract by and between Contractor and the City providing for the referenced services. The Scope of Work includes:
1. Description of the Work:
1.1 Description: Provide the City with a full service Workers’ Compensation administration, to include Claims Administration Services, Administrative Services, and Medical Control Services.
2. Specific Tasks:
As part of the Scope of Work, the Contractor shall perform the following tasks:
2.1 Task 1 – Claim Administration Services
a. Upon receipt of claim form from City, electronically file reports of injury to the appropriate jurisdiction, if not already filed by City. b. Review each Claim received from City and process such Claim in accordance with the City’s Insurance Program and in accordance with reasonable Workers’ Compensation administrative practices and accepted industry standards, and pursuant to any specific service instructions agreed upon with City.
c. Investigate each reported Claim to determine on behalf of City for each reported employee injury or illness those benefits, if any, that should be rendered under the Insurance Program. Any Claim believed to be fraudulent shall be referred to Intercare’s in-house special investigative unit for further investigation, and the unit shall, with the prior approval of City determine whether such Claim is required to be submitted to the applicable District Attorney’s Office or United States Attorney. d. Make compensability determination and issue appropriate determination notices.
e. Arrange for and retain independent investigators or medical or other experts, to the extent deemed necessary or desirable by Intercare, in connection with processing any Claim.
f. Maintain an estimate of the total costs of all reasonable and foreseeable benefits payable and related expenses on each Qualified Claim based upon the facts and circumstances known at the time and update the same on a regular and periodic basis.
g. Make prompt payment of all benefits including medical and death benefits, temporary and permanent disability compensation and other losses and expenses on Qualified Claims (a) if, in the judgment of Intercare, such payment would be prudent for City and (b) pursuant to the terms of this Agreement or as may be approved by City in its sole and absolute discretion.
h. Perform reasonable and necessary administrative and clerical work in connection with Claims including the preparation of checks drawn on the account or accounts established by, or at the direction of City. i. Assist in connection with City’s selection of defense counsel to defend Qualified Claims or losses, if requested by City.
j. Assist City’s selected defense counsel in preparing the defense of litigated Claims, negotiating settlements, and pursuing subrogation or contribution actions.
k. Oversee the treatment programs recommended for Claimants by physicians, medical specialists, and other health care providers by reviewing all reports prepared by such providers and maintaining such contact with such providers as may be appropriate in the judgment of Intercare; and (b) manage the medical treatment in accordance with Insurance Program.
l. Prepare and file on behalf of City all forms related to the processing of Claims that are required by the Insurance Program or government agencies except for MMSEA filings which shall remain the responsibility of the City. City may designate Intercare as an RRE Agent to file on behalf of City, the monthly eligibility query and Quarterly Reporting with the Center for Medicare and Medicaid Services.
m. Provide initial claims forms packets as deemed appropriate by Intercare for efficient administration of Claims in compliance with the Insurance Program.
n. Comply with City’s service instruction guidelines for the administration of the Services as such Services are set forth in this Agreement. o. Establish and maintain an electronic record file for each Claim. p. Maintain an average Caseload of 150 cases or less per Indemnity Adjuster. The average Indemnity caseload shall not exceed 150 cases in any given quarter. If the frequency of new claims increases to a level that warrants the addition of staff to maintain the caseload requirements, Intercare and City shall agree to evaluate the caseload for a period of at least three consecutive months before adjusting the number of staff accordingly. Caseload shall be defined by the number of indemnity and future medical cases open on the last day of each calendar month. In calculating the average caseload, Medical Only and/or Future Medical claims shall be weighted as 50% of an Indemnity claim.
2.2 Task 2 – Administrative Services
a. Consult with key personnel of City on the establishment and coordination of necessary procedures and practices to meet any needs of City with respect to the administration and processing of Claims. b. Participate in the orientation of City’s personnel who are directly or indirectly involved in the processing of Claims.
c. Provide information on changes or proposed changes in legislation, rules or regulations affecting the responsibility of City with respect to Claims.
d. Review the development of the Insurance Program periodically with representatives of City to identify problems and recommend corrective action.
e. Provide training sessions annually to the City including Basic Workers’ Compensation Guidelines and Fraud Detection.
f. Meet periodically with City at mutually agreeable times to review active claims on a quarterly basis to discuss claim management strategies. g. Provide City with standard loss reports, including, but not limited to, monthly loss run and payment registers, and statistical reports; if additional reports, special reports, conversion or special programming or information is needed, the cost payable by City for such additional items will be limited to costs actually incurred by Intercare to prepare such items; City may specify from the list of available reports which reports will be sent to them on a regular basis.
h. If 1099 forms are required to be issued in accordance with the benefit delivery system, arrange for issuance of 1099s at no additional cost to City.
i. Deliver a standard annual stewardship report outlining program trends and outcomes.
2.3 Task 3 – Medical Control Services
a. Assist City, where permitted, in the selection of (a) a medical provider network and panel of physicians or other health care providers to initially treat Claimants and (b) a medical provider network and panel of medical specialists to provide long-term or specialty care.
b. Where appropriate, assist City with the interpretation of medical reports to consider the circumstances under which an ill or injured Claimant, who desires to do so, could return to work in the shortest period. c. Endeavor to utilize managed care services including Bill Review, Utilization Review and Case management as a form of cost containment when warranted using Intercare’s Managed Care Division, InterMed Cost Containment Services.
METHOD OF PAYMENT
Subject to the terms and conditions of this Contract, Contractor shall be paid on a basis set forth herein by the checked box below:
A not to exceed amount of $1,418,757 over the term of the contract for work performed ased on the following rates:
City of San Rafael
I. 1
Initial Term: Rates
7/1/2026-6/30/2027 $264,571.84
7/1/2027-6/30/2028 $273,831.85
7/1/2028-6/30/2029 $283,415.97
Option Years: Rates
7/1/2029-6/30/2030 $293,335.53
7/1/2030-6/30/2031 $303,602.27
II.
) $ 10,000.00 one-time fee
- – unlimited users No charge
$25.00
$750.00 – No charge. Each
additional license is
$1,500.00 per user per
year
– View Only No charge – o $150.00 per filing
o $500.00 per case
o – $300.00 per case
o $425.00 per case
III.
The proposed fees for managed care services are provided on a “per unit rate” and will be applied as incurred to the City’s actual usage or volumes. Fees for managed care services and ALAE.
2 Rates
Per Bill Fee $10.00 per bill
PPO Access Fee 25% of PPO Savings
Secondary Review Specialty Bill Review (out of network
bills, bills not subject to OMFS and complex bills over $5,000).
15% of savings cap at $5,000
per bill3
Hospital Bills (In/Out Patient or ambulatory surgical
bills)
$400.00 per bill
Level 1 – Pre-Clinical $25.00 per RFA
Level 2 – UR Nurse $145.00 per review
Level 3 – Medical Director $300.00 per review
Specialty Peer Review $350.00 per review
4 Telephonic Case Management $105.00 per hour
Field Case Management $125.00 per hour
Triage Services $100.00 per call
Telehealth Services Subject to OMFS
1 - 1 user license to access Claim System with read and write capability plus unlimited view only access to Injured Worker App
RMIS reports using standard bordereaux of reports, statutory reports including 1099, SIP annual report, WCIS reports, MMSEA Quarterly reports, OSHA Logs.
Adhoc and custom reports available at $150.00 per hour.
Quarterly claim review (2 onsite and 2 virtually)
InterAct Roundtable of Complex Cases
o Claims Supervisor .50
o Claims Adjuster 1.00
o Claims Assistant .20
incurred medical costs exceed $3,500. That is denied but otherwise would ha . -only claim.
that require no payment or activity other than
These expenses will be billed to -
- 3prospectively or retrospectively. 4
-minute increments
.
v. Feb 2025 Exhibit B-1
EXHIBIT B
INSURANCE REQUIREMENTS
During the term of this Contract, and for any time period set forth below, Contractor shall procure and maintain in full force and effect, at no cost to City insurance policies with respect to employees and vehicles assigned to the performance of work under this Contract with coverage amounts, required endorsements, certificates of insurance, and coverage verifications as defined in this Exhibit B.
A. Scope of Coverage. During the term of this Contract, Contractor shall maintain, at no expense to City, the following insurance:
1. Commercial general liability. A commercial general liability insurance policy in the minimum amount of one million dollars ($1,000,000) per occurrence/two million dollars ($2,000,000) aggregate, for death, bodily injury, personal injury, or property damage.
2. Automobile liability. An automobile liability (owned, non-owned, and hired vehicles) insurance policy in the minimum amount of one million dollars ($1,000,000) per occurrence.
3. Professional liability. If any licensed professional performs any of the work required to be performed under this Contract, a professional liability insurance policy in the minimum amount of one million dollars ($1,000,000) per occurrence/two million dollars ($2,000,000) aggregate, to cover any claims arising out of the Contractor's performance under this Contract. Where Contractor is a professional not required to have a professional license, City reserves the right to require Contractor to provide professional liability insurance pursuant to this section.
4. . If it employs any person, Contractor shall
dollars ($1,000,000) per accident for bodily injury or disease. Contractor compensation insurance shall be specifically endorsed to waive any right of subrogation against City. B. Other Insurance Requirements. The insurance coverage required of the Contractor in subparagraph A of this section above shall also meet the following requirements:
1. insurance, the insurance policies shall be specifically endorsed to include the City, its officers, agents, employees, and volunteers, as additional insureds (for both ongoing and completed operations) under the policies.
2. The additional insured coverage under Contractor s insurance v. Feb 2025 Exhibit B-2
any insurance or coverage
maintained by City and shall not call upon City's insurance or self-insurance coverage for policies shall
be at least as broad as ISO form CG20 01 04 13.
3. insurance, the insurance policies shall include, in their text or by endorsement, coverage for contractual liability and personal injury.
4. By execution of this Contract, Contractor hereby grants to City a waiver of any right to subrogation which any insurer of Contractor may acquire against City by virtue of the payment of any loss under such insurance. Contractor agrees to obtain any endorsement that may be necessary to effect this waiver of subrogation, but this provision applies regardless of whether or not City has received a waiver of subrogation endorsement from the insurer.
5. If the insurance is written on a Claims Made Form, then, following termination of this Contract, said insurance coverage shall survive for a period of not less than five years.
6. The insurance policies shall provide for a retroactive date of placement coinciding with the Effective Date of this Contract.
7. The limits of insurance required in this Contract may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of City (if agreed to in a written contract or agreement) before own insurance or self-insurance shall be called upon to protect it as a named insured.
8. It shall be a requirement under this Contract that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be available to City or any other additional insured party.
Furthermore, the requirements for coverage and limits shall be: (1) the minimum coverage and limits specified in this Contract; or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured; whichever is greater. No representation is made that the minimum insurance requirements of this Contract are sufficient to cover the obligations of the Contractor under this Contract.
9. Contractor agrees to ensure that subcontractors, and any other party involved with the performance of work under this Contract, who is brought onto or involved in the performance of the work by Contractor under this Contract, provide the same minimum insurance coverage required of Contractor, except as with respect to limits. Contractor agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this Contract. CONSUTLANT agrees that upon request by City, all v. Feb 2025 Exhibit B-3
agreements with, and insurance compliance documents provided by, such subcontractors and others engaged in the work under this Contract will be submitted to City for review.
10. Contractor agrees to be responsible for ensuring that no contract used by any party involved in any way with the Scope of Work reserves the right to charge City or Contractor for the cost of additional insurance coverage required by this Contract.
Any such provisions are to be deleted with reference to City. It is not the intent of City to reimburse any third party for the cost of complying with these requirements. There shall be no recourse against City for payment of premiums or other amounts with respect thereto.
C. Any deductibles or self-insured retentions in
Contractor's insurance policies must be declared to and approved by the City and shall not reduce the limits of liability. Policies containing any self-insured retention (SIR) provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or City or other additional insured party. At City's option, the deductibles or selfinsured retentions with respect to City shall be reduced or eliminated to City's satisfaction, or Contractor shall procure a bond guaranteeing payment of losses and related D. Proof of Insurance. Contractor shall provide to the Project Manager all of the following: (1) Certificates of Insurance evidencing the insurance coverage required in this Contract; (2) a copy of the policy declaration page and/or endorsement page listing all policy endorsements for the commercial general liability policy, and (3) excerpts of policy language or specific endorsements evidencing the other insurance requirements set forth in this Contract. City reserves the right to obtain a full certified copy of any insurance policy and endorsements from Contractor. Failure to exercise this right shall not constitute a waiver of the right to exercise it later. The insurance shall be approved as to form and sufficiency by the City. Failure to comply with these requirements shall be considered a material breach of contract.
v. Feb 2025 Exhibit C-1
EXHIBIT C
GENERAL TERMS AND CONDITIONS
1. COMPLIANCE WITH ALL LAWS.
Contractor shall observe and comply with all applicable federal, state and local laws, ordinances, codes and regulations, in the performance of its duties and obligations under this Contract. Contractor shall perform all work under this Contract in accordance with these laws, ordinances, codes and regulations. Contractor shall release, defend, indemnify and hold harmless City, its officers, agents and employees from any and all damages, liabilities, penalties, fines and all other consequences from any noncompliance or violation of any laws, ordinances, codes or regulations.
2. PROVISIONS DEEMED INSERTED.
Every provision of law required to be inserted in the Contract is deemed to be inserted, and the Contract will be construed and enforced as though such provision has been included. If it is discovered that through mistake or otherwise that any required provision was not inserted, or not correctly inserted, the Contract will be deemed amended accordingly.
3. SEVERABILITY.
If any provision of the Contract documents, or portion of a provision, is determined to be illegal, invalid, or unenforceable, the remaining provisions of the Contract documents will remain in full force and effect.
4. OWNERSHIP OF DOCUMENTS.
The written documents and materials prepared by the Contractor in connection with the performance of its duties under this Contract, shall be the sole property of City. City may use said property for any purpose, including projects not contemplated by this Contract.
5. INSPECTION AND AUDIT.
Upon reasonable notice, Contractor shall make available to City, or its agent, for inspection and audit, all documents and materials maintained by Contractor in connection with its performance of its duties under this Contract. Contractor shall fully cooperate with City or its agent in any such audit or inspection. Contractor shall maintain all Projectrelated records for a period of three (3) years from completion of the work.
6. ASSIGNABILITY.
The parties agree that they shall not assign or transfer any interest in this Contract nor the performance of any of their respective obligations hereunder, without the prior written consent of the other party, and any attempt to so assign this Contract or any rights, duties v. Feb 2025 Exhibit C-2
or obligations arising hereunder shall be void and of no effect.
7. WORKERS' COMPENSATION.
Contractor certifies that it is aware of the provisions of the Labor Code of the State of California which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that Code, and Contractor certifies that it will comply with such provisions before commencing the performance of the work of this contract.
8. NONDISCRIMINATION.
Contractor shall not discriminate, in any way, against any person on the basis of sex, race, color, religion, ancestry, national origin, ethnic group identification, age, mental disability, physical disability, medical condition, genetic information, marital status, or sexual orientation in connection with or related to the performance of its duties and obligations under this Contract.
9. NO THIRD PARTY BENEFICIARIES.
City and Contractor do not intend, by any provision of this Contract, to create in any third party, any benefit or right owed by one party, under the terms and conditions of this Contract, to the other party.
10. INDEPENDENT CONTRACTOR.
For the purposes, and for the duration, of this Contract, Contractor, its officers, agents and employees shall act in the capacity of an Independent Contractor, and not as employees of the City. Contractor and City expressly intend and agree that the status of Contractor, its officers, agents and employees be that of an Independent Contractor and not that of an employee of City. 11. ENTIRE CONTRACT -- AMENDMENTS.
A. The terms and conditions of this Contract, all exhibits attached, and all documents expressly incorporated by reference, represent the entire Contract of the parties with respect to the subject matter of this Contract.
B. This written Contract shall supersede any and all prior contracts, oral or written, regarding the subject matter between the Contractor and the City. C. No other agreement, promise or statement, written or oral, relating to the subject matter of this Contract, shall be valid or binding, except by way of a written amendment to this Contract.
D. The terms and conditions of this Contract shall not be altered or modified v. Feb 2025 Exhibit C-3
except by a written amendment to this Contract signed by the Contractor and the City. E. If any conflicts arise between the terms and conditions of this Contract, and the terms and conditions of the attached exhibits or the documents expressly incorporated by reference, the terms and conditions of this Contract shall control.
12. SET-OFF AGAINST DEBTS.
Contractor agrees that City may deduct from any payment due to Contractor under this Contract, any monies which Contractor owes City under any ordinance, agreement, contract or resolution for any unpaid taxes, fees, licenses, assessments, unpaid checks or other amounts.
13. WAIVERS.
The waiver by either party of any breach or violation of any term, covenant or condition of this Contract, or of any ordinance, law or regulation, shall not be deemed to be a waiver of any other term, covenant, condition, ordinance, law or regulation, or of any subsequent breach or violation of the same or other term, covenant, condition, ordinance, law or regulation. The subsequent acceptance by either party of any fee, performance, or other consideration which may become due or owing under this Contract, shall not be deemed to be a waiver of any preceding breach or violation by the other party of any term, condition, covenant of this Contract or any applicable law, ordinance or regulation.
14. CITY BUSINESS LICENSE / OTHER TAXES.
Contractor shall obtain and maintain during the duration of this Contract, a City business license as required by the San Rafael Municipal Code, and Contractor shall pay any and all state and federal taxes and any other applicable taxes. City shall not be required to pay for any work performed under this Contract, until Contractor has provided City with a completed Internal Revenue Service Form W-9 (Request for Taxpayer Identification Number and Certification).
15. SURVIVAL OF TERMS.
Any terms of this Contract that by their nature extend beyond the term (or termination) of this Contract
successors and assigns.
16. GOVERNING LAW.
This Contract shall be deemed to have been executed in the County of Marin, California. The formation, interpretation and performance of this Contract shall be governed by the laws of the State of California, excluding its conflict of laws rules. Any suit or action initiated by either party shall be brought in the County of Marin, California unless the parties agree otherwise in a written amendment to this Contract. v. Feb 2025 Exhibit C-4
17. CONFLICT OF INTEREST.
Contractor, its employees, subcontractors and agents, may not have, maintain or acquire a conflict of interest in relation to this Contract in violation of any City ordinance or policy or in violation of any California law, including under Government Code section 1090 et seq. and under the Political Reform Act as set forth in Government Code section 81000 et seq. and its accompanying regulations. Any violation of this Section constitutes a material breach of the Contract.
18. AUTHORIZATION.
Each individual signing above warrants that they are authorized to do so by the party that they represent, and that this Contract is legally binding on that party. If Contractor is a corporation, signatures from two officers of the corporation are required pursuant to California Corporation Code section 313.
19. COUNTERPARTS AND ELECTRONIC SIGNATURE.
This Contract may be executed by electronic signature and in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one document. Counterpart signature pages may be delivered by telecopier, email or other means of electronic transmission.
Updated April 1, 2026
CONTRACT ROUTING FORM
INSTRUCTIONS: Use this cover sheet to circulate all contracts for review and approval in the order shown below.
All following documents are attached as reference material.
RESPONSIBLE PARTY DESCRIPTION COMPLETED
Project Manager
Email PINS insurance request to Contractor
Confirm legal business name, entity type and authorization to do business in California on California Secretary of State Business search site
Project Manager
For Public Works and Vegetation Management Contracts:
Confirm contractor license is current and valid on California State License Board website
not applicable
City Attorney’s Office Review, revise as needed, and approve agreement as to form
Department Director
Review and approve agreement
AB 339 not applicable or Complied with AB 339
Risk Management Confirm insurance documentation is complete Finance Review and sign off on funding availability
TO BE COMPLETED BY INITIATING DEPARTMENT PROJECT MANAGER:
Contracting Department: Project Manager: Contractor Name:
Contractor’s Contact: Contact’s Email:
City Council Date: ___________________ or Not applicable FPPC: Check if Contractor must file Form 700
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING
AAUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH INTERCARE HOLDINGS INSURANCE SERVICES, INC. FOR WORKERS’ COMPENSATION THIRD-PARTY CLAIMS ADMINISTRATION SERVICES IN AN AMOUNT NOT TO EXCEED $1,418,757 AND AUTHORIZING THE CITY MANAGER TO
EXECUTE ALL NECESSARY AND INCIDENTAL DOCUMENTS
WHEREAS, the City of San Rafael is self-insured for workers’ compensation and is responsible for the administration and management of claims arising from employee workrelated injuries and illnesses; and WHEREAS, workers’ compensation claims administration requires specialized expertise in claims adjusting, medical management, regulatory compliance, and litigation coordination; and
WHEREAS, the City has evaluated options for the administration of its workers’ compensation program and determined that utilizing a qualified Third-Party Administrator (TPA) will improve efficiency, enhance claims outcomes, and ensure compliance with applicable laws and regulations; and
WHEREAS, Intercare Holdings Insurance Services, Inc. (“Intercare”) has demonstrated the qualifications, experience, and capacity to provide comprehensive workers’ compensation claims administration services; and
WHEREAS, Intercare’s services will include claims investigation and adjustment, benefit administration, medical management, litigation coordination, fraud detection, regulatory reporting, and data management; and
WHEREAS, the proposed agreement provides for an initial three-year term beginning July 1, 2026 through June 30, 2029, with two additional one-year extension options, for a total potential term of five (5) years; and
WHEREAS, the total compensation under the agreement shall not exceed $1,418,757 over the full five-year term, including a one-time data conversion fee, with funding available in the Workers’ Compensation Internal Service Fund; and
WHEREAS, the City Council has determined that approval of this agreement is in the best interest of the City to ensure effective and efficient management of its workers’ compensation program.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of San Rafael, that foregoing recitals are true and correct and the City Manager is authorized to execute the Professional Services Agreement with Intercare Holdings Insurance Services, Inc. for workers’ compensation Third-Party claims Administration services in an amount not to exceed $1,418,757 over the five year term.
I, Lindsay Lara, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday, the 4th day of May, 2026, by the following vote to wit:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
______________________
LINDSAY LARA, City Clerk