City Council Worksession

South St. Paul MAYOR/COUNCIL WORKSESSION SSP City Hall 125 3rd Avenue North Monday, December 9, 2013 7:00 p.m. AGENDA: 1. Progress Plus Update (no attachment) 2. Discussion: Odor Ordinance (no attachment) 3. Discussion: Alternative Financial Establishments Ordinance (see attached maps) 4. Discussion: Insurance Broker selection recommendation 5. Closed session to discuss labor negotiations (no attachments) • Teamsters (Public Works personnel) • LELS (Police personnel)  Alternative Financial Establishment Ordinance Legend - Properties in GB - more than 600 feet from Residential c=J Properties in GB - more than 300 n from Residential - - ssp road center line c:J Mississippi River [::::J GB: General Business District • _. oo•o•2•,ocoo=====4~ 1.• , o. oo..... 6•.ooo Feet C:=J ssp parcela Prepared by: South St. Paul Engineering Dept. Map Date: December 4, 2013  Alternative Financial Establishment Ordinance Legend - Properties In GB - more than 800 feel from Residential - - ssp road center line [::J Mississippi River [::::J GB: General Business District [==:J ssp parcela ----=====:::::J___ii Feet 1,0002,000 4,000 6,000 Prepared by: South St. Paul Engineering Dept. Map Date: December 4, 2013  R City Council Worksession Report 1!1 -~· Date: Department: December 9, 2013 Administration Administrator: :5j?( Agenda Item: Discussion - Insurance Broker selection recommendation I. Desired meeting outcomes • Review and discuss process used in the solicitation and evaluation of responses to a Request for Proposals (RFP) for insurance broker services. • Review and discuss recommendation for selection of an insurance broker for the City's insurance needs. • Provide Staff with direction as to requested additional information and analysis and/or next steps to be taken in the selection process. • Provide direction as to filing of 'Agent of Record' notifications. II. Process Overview: The City has engaged the professional services of Clem Duffy as its broker/agent of record for the City's employee medical and dental insurance, long-term disability insurance and life insurance. The relationship has been in existence for over a decade and Staff has found no information on any prior Request for Proposals (RFP) and selection process for these services. On a related note, the City also offers employees access to a 'flexible benefit plan' and has long engaged the Freedom Services firm as our program administrator. Possible changes to this latter service will await arrival of the new broker and will likely be tied to the market search for new medical/employee plans. In similar fashion, Sherman Insurance has provided professional services as the City's broker/agent of record for the City's general liability/ property/casualty insurance coverages, which historically have been secured through the League of Minnesota Cities (LMC). This relationship broker/agent relationship has also been in existence for over a decade and Staff again has no information on any prior Request for Proposals (RFP) and selection process for these services. On a related note, the City has not historically used the existing broker/agent for professional services associated with Worker's Compensation claims management and instead has relied on direct Staff interaction with the League of Minnesota Cities Insurance Trust (LMCIT), which writes the Worker's Comp coverage. In contrast, in many cities, claims management assistance is another service provided by the broker/agent responsible for the liability and property/casualty insurance program. For some time, City Staff and the City Council has been aware that as a best practice RFP's for professional services should be conducted on regularly recurring intervals and certainly more frequently than the City's most recent history with its broker/agent services. While State law does not mandate a specific interval, Staff has been counseled that intervals of3-5 years would be appropriate. City Stafftherefore developed and distributed the attached "Request for Proposals for Insurance Agent Services". Notice of the opportunity was posted on the City's website and on the in the LMC on-line RFP notice section. In addition, notice was individually provided to firms that had previously expressed an interest in participation and/or were known to Staff as providers of these services to other Minnesota municipalities. The RFP invited responses for the provision of both forms of City insurance needs, (employee health/benefits and liability/property/casualty) and/or just one ofthe two areas. The RFP similarly reserved to the City the right to select a vendor for one and/or both of the serv1ce areas. The City received 13 responses to the RFP for employee benefits and for liability/property/casualty broker/agent services. The overall quality of the submissions was excellent. Five staff reviewers independently reviewed submissions and then thereafter compared notes. The reviewers included the City Administrator Steve King, Asst. City Administrator Shelly Anderson, City Clerk Christy Wilcox, City Finance Director Michelle Pietrick, and Asst. Finance Director Clara Hilger. Each of the reviewers possesses substantial experience with municipal insurance coverage and most had direct experience with the services provided by the City's current brokers/agents. The five reviewers collectively identified six respondents for oral interviews. Four of the respondents expressed interest in both components of the City's program. One expressed interest only in the employee health/benefits component and one was interested only in the liability/property/casualty program. The City's current service providers were not among the finalists selected for interviews. The finalists included: 1) Marsh & McLennan Agency; 2) Northern Capital Insurance Group (property/casualty only); 3) Associated Financial Group; 4) Financial Concepts (Employee Health/Benefits only); 5) CBIZ; 6) Gallagher Benefits. Interviews were conducted with the finalists on November 191h and 201h. The interview panel included the five individuals noted above and Mayor Beth Baumann. Attached are the interview questions. After review and discussion, the interviewing panel consensus was to recommend the engagement of Marsh & McLennan Agency as the broker/agent of record with regard to both the City' s employee health/benefits insurance program and to the City's liability/property/casualty and Worker's Compensation insurance needs. City Staff members met with Marsh & McLennan representatives on Wednesday, December 4th to clarify scope of services and compensation elements of their proposal. III. Rationale for the recommendation of Marsh & McLennan Agency for insurance broker/agent of record professional services Attached are excerpts from the Marsh & McLennan response to the City's RFP. They include an Executive Summary that includes succinct answers to the subjects raised in the City's RFP. They also include the table of contents for the remaining elements of the firm's submittal. If a Council member would like to see the full response, Staff can provide a copy. The fees are discussed on page 16 of the response. It can be noted that during the discussion on December 4th, Staff indicated that the option for additional services (at additional cost) in the wellness area (Well-being program) was not of immediate interest to the City. The Staff rationale is that while the offering is of future interest, the immediate resources of City Staff will be consumed in the launch of the basic insurance programs. Staff recommends the Marsh & McLennan Agency for a variety of reasons: 1. Their materials and presentation were excellent and highly responsive to the RFP. 2. The credentials cited for their personnel were very strong, indicating extensive experience with the various subject matters involved in the City's insurance program. 3. They exhibited good understanding of problem areas in the Worker's Compensation claims management arena and exhibited a willingness to aggressively tackle them. 4. They exhibited good understanding of the rationale and mechanics of Employee insurance committees, especially as they relate to collective bargaining constraints. 5. They appear committed to data-driven analysis and strategies. For example, they gave good evidence of how to utilize benchmarking techniques to mold a local program. 6. The price was in line with responses received by the City. 7. The firm has been accorded workplace excellence awards. 8. The Agency representatives were personable, knowledgeable, and excited to take on our opportunity. IV. Next Steps The proposed relationship with Marsh & McLennan Agency would commence on January 1, 20 14. It is initiated with the filing of"agent of record" letters with the City's insurers, (i.e., LMCIT and Health Partners). Staff seeks support for authorizing the tendering of those letters as soon as possible, given the time of the year. If acceptable to the City Council, Staff would have them send the letters on the day following the Worksession. This act would then be ratified by actions at the City Council meeting of 12/16/2013. As a part of the Council meeting of 12116/2013, the Council will be asked to approve two agreements with the Agency, one for the Employee health/benefits component and one for the Risk Management (liability/property/casualty) and Worker's Compensation component. The contract term is for three years, with a renewal option for another three years. The contract price remains fixed for each of the three years of the contract. The City retains the right to add services (e.g., Well-being) at additional cost during the term ofthe agreement. The City retains the right to terminate the agreement during its term upon reasonable notice (30 days). V. Budget and Financial ramifications The Marsh & McLennan proposal includes a flat annual fee of $22,500 for the Employee health/benefit component and a fee of $12,000 for the liability/property/casualty and Worker's Compensation components. They also offered a 10% discount if awarded engagement for both components. These elements would produce a cumulative cost of$31,050 for each ofthe three years of the proposed contract. The City paid $25,907 in 2013 for the liability/property/casualty component of its insurance program. It paid an additional $30,936 - ($24,949 for health and $5,987 for dental) - for employee health/benefit coverage. In total, the City therefore is expending $56,843 for the 2014 insurance program need for broker/agent services. The new relationship with Marsh & McLennan therefore would be a savings of roughly $25,000. The 2014 Budget was prepared with sufficient allocation of funds for the proposed services. City of South St. Paul, Minnesota Request for Proposals For Insurance Agent Services City of South St. Paul Administration Department 125 3rd Avenue North South St. Paul, MN 55075 www.southstpaul.org October 2013 INTRODUCfiON The City of South St. Paul (City) invites written proposals from insurance brokers (Broker/Respondent) to act as the Agent of Record on behalf of the City for three (3) years, with an option for an additional three (3) year term beginning in January 2014. The City is open to proposals that address the City's comprehensive insurance needs and policies, or a specified subset thereto. The City will make its selection of an agent based on the insurance agency or broker's qualifications, experience, references, and cost of providing service to the City. PROCUREMENT PROCESS The issuance of this Request for Proposal (RFP) constitutes an invitation to submit proposals to the City. The City in its sole and absolute discretion, reserves the right to determine whether any aspect of the proposal satisfactorily meets the criteria established in this RFP; the right to seek clarification from any Respondent; the right to negotiate with any Respondent(s) whether or not they submitted a proposal; the right to reject any or all proposals with or without cause; and the right to cancel and/ or amend any and all parts of the RFP. The City assumes no expressed or implied obligation for reimbursing Respondent(s) for any costs or expenses incurred in connection with this RFP. Each proposal should express the Respondent's most favorable cost terms and programmatic considerations, and should be submitted in a complete and understandable form. The City reserves the right to request additional information or clarification, or to allow corrections of errors or omissions during the evaluation process. At the discretion of the City, Respondents may be required to provide oral presentations as part of the evaluation process. The City reserves the right to retain all submitted proposals and to use any ideas expressed in a proposal regardless of whether that proposal is selected. Submission of a proposal constitutes acceptance of the conditions contained in this RFP by the Respondent, unless clearly and specifically noted in the submitted proposal and confirmed in the contract between the City and the Respondent. The City in its sole discretion may contract with more than one (1) Respondent for the services contemplated herein. The City in its sole discretion may also reduce or expand the scope of requested services. PROPOSAL SUBMISSION Five (5) copies of the Proposal shall be submitted by 4:00PM CST on Monday, October 21, 2013 to: Shelly Anderson City of South St. Paul 125 3rd Avenue North South St. Paul, MN 55075 (651) 554-3203 (office) (651) 554-3201 (fax) sanderson@sspmn.org SCOPE OF SERVICES The City requests proposals for comprehensive Broker services associated with the City's insurance coverage through the League of Minnesota Insurance Trust (LMCIT) for General Liability, Property/Casualty, and Workers' Compensation. In addition, the City is seeking comprehensive Broker services relating to the City's Medical and Dental Insurance, Long-term Disability Insurance, Flex Plan Administration, and various modes of Life Insurance. In relation to general liability, property/ casualty, and workers' compensation, the Broker will be responsible for the following: 1) Assist with the completion of the LMCIT renewal forms using the data supplied by the City. 2) Review of the LMCIT insurance policies for completeness and accuracy. Conftrm that the schedules have been updated for the new data supplied during the renewal process. Provide the City with a recap of insurance costs and an explanation of premium increases for each renewal. 3) Provide explanations of insurance coverage, coverage options and make recommendations to include an analysis of available alternatives in consideration of the City's exposures, including making presentations before the City Council and/ or staff when requested. 4) Issue certiftcates of insurance as needed. 5) Will assist in evaluating and confirming that city contractors have obtained the insurance coverage required by the City. 6) Assist/ actively participate in all forms of claims management. 7) Perform other duties customarily handled by an insurance agent and agreed upon by both the City and Broker. In relation to employee benefit insurance offerings, the Broker will be responsible for the following: 1) Advise and assist the City in evaluating and selecting the full range of coverage alternatives and plan designs, including making presentations before the City Council and/ or staff when requested. 2) Assist the City in administering all group insurance plans, open enrollment processes, responding to questions and providing information to staff, and providing other consulting services during the course of the plan year. 3) Review claims experience, claim service, and claim administration to ensure maximum benefit to the City. 4) Determine and recommend the most economical funding methods for the beneftt programs to achieve a balance between cost and comprehensiveness of the programs. 5) Develop a solicitation/negotiation strategy and participate with the City in all negotiations with providers on all issues including those related to premiums, benefit levels, plan design, and special terms and conditions. 6) Provide timely and pertinent reports to City personnel.  7) Assist the City in the preparation and administration of benchmarking surveys. 8) Assist the City with explaining in clear employee-friendly language the full range of coverage alternatives and plan designs, including attending and presenting information at employee open enrollment meetings. 9) Assist the City in complying with laws and regulations related to employee benefits, including keeping the City informed of any new developments in the law. 10) As requested by the City, prepare bid specifications and solicit proposals from insurance markets which specialize in group insurance plans as needed. Evaluate bids and bidders, including administration, coverage, claim payment procedures, customer service, networks, financial soundness, and identify the most cost-beneficial package from among the various bidders. QUALIFICATIONS The Broker/ Respondent shall demonstrate their experience and qualifications by including in their proposal the following information: 1) Clearly delineate which service(s) the Respondent seeks to serve as agent of record for: (a) General Liability, Property/ Casualty, Workers' Compensation ONLY (b) Employee Benefit Insurance offerings ONLY (c) BOTH A and B 2) Briefly describe Respondent's history, number of employees, years in existence and fmancial status and stability. 3) Detail the name(s), qualifications, experience, and professional designations of the Respondent's staff proposed to service the City's account. 4) List experience with working with municipalities insured by the IMCIT during the last five years. 5) Present limit of errors and omissions coverage in place for the Respondent. 6) Describe Respondent's service philosophy. 7) Describe Respondent's marketing capabilities with emphasis on those lines of coverage requested in the RFP. 8) Describe Respondent's experience and expertise regarding public entity risks by relating markets to which the firm has access. 9) Describe Respondent's information technology capabilities. 10) Describe the steps Respondent would take in reviewing the City's current programs and in designing changes in the programs. Include specific techniques and procedures Respondent may use to assist in identifying current and anticipated new loss exposures to the City. 11) Describe the measures Respondent takes to proactively stay abreast of changes in the marketplace, including mergers / acquisitions, pricing trends, coverages and so forth. Explain how Respondent would keep the City informed of current developments.  12) Describe Respondent's data privacy practices in keeping client information safe. 13) Describe Respondent's approach and time line to obtain the best coverage and pricing for the City, as well as future design/cost containment plan. 14) Describe Respondent's client turnover experience within the past three (3) years. 15) Disclose any conflicts and/ or perceived conflicts of interest with the City. 16) Provide the contact information of five (5) governmental unit clients in the State of Minnesota with whom Respondent has had a working relationship, as a reference for the City. Include the number of participants for each group. 17) List Respondent's proposed fee for services, to include: (a) Proposed fees for insurance brokerage and consulting for each of the three (3) years of the contract, and up to three (3) additional one (1) year renewal terms. (b) The proposal should contain the proposed fee for services in either a fixed dollar amount or as a percentage of premiums paid for coverage. (c) List any additional service options, as well as the fee structure involved. (d) Provide any alternate pricing proposals Respondent would like the City to consider. NON-COLLUSION CERTIFICATION By submission of this proposal, Broker/Respondent certifies that: 1) The proposal has been independently developed by the Respondent and has been submitted without collusion with any other broker. 2) The contents of the proposal have not been communicated to the best of its knowledge, by its employees or agents, to any person not an employee or agent of the Respondent, and will not be communicated to any such person or entity prior to the official opening of the proposal. 3) No Broker/Respondent shall submit more than one proposal for these services. It shall be the responsibility of each Respondent to obtain prior written permission from the City before the proposal opening of any situation that the Respondent, due to corporate association or other affiliation, may be found to impermissibly associated with another broker. RIGHT OF REVIEW The City of South St. Paul reserves the right to reject any or all proposals. The City also has the right to request additional information from any or all Respondents in order to help the City make a decision as to the Respondent's best services and interests of the City. The City intends to select and award a contract to the Broker/ Respondent or Broker(s)/Respondent(s) best qualified to perform the work based on cost, extent and quality of the Respondent's resources, communications and presentation skills, plus the quality and extent of municipal representation and experience. DISPOSITION OF RESPONSES All materials submitted in response to this RFP will become the property of the City and will become public record after the evaluation process is completed and an award decision is made. If the Respondent submits information in response to this RFP that it believes to be trade secret materials, as defined by the Minnesota Government Data Practices Act, Minnesota Statutes 13.37, the Respondent must:  (a) clearly mark all trade secret materials in its response at the time the response is submitted (b) include a statement with its response justifying the trade secret designation for each item and defend any action seeking release of the materials it believes to be a trade secret, and indemnify and hold harmless the City, its agents and employees, from any judgments or damages awarded against the City in favor of the party requesting the materials, and any and all costs connected with that defense. This indemnification survives the City's award of contract. In submitting a response to this RFP, the Respondent agrees that this indemnification survives as long as the trade secret materials are in possession of the City. The City is required to keep all the basic documents related to its contracts, including responses to Requests for Proposals for a minimum of seven years. The City will not consider the prices submitted by the Broker/Respondent to be proprietary or trade secret materials. Responses to the RFP will not be open for public review until the City decides to pursue a contract and that contract is awarded. CONTRACT EXECUTION The following information is to provide the applicants an understanding of the City's expectations with respect to contract negotiations and execution. 1) Negotiations and Contract Execution - The City of South St. Paul reserves the right to negotiate the final terms and conditions of the contract to be executed. In the event the City and the Respondent are unable to agree upon all contract provisions, the City reserves the right to cease negotiations, and to move on to select another broker, or to reject all proposals. 2) Contracting Ethics (a) No elected official or employees of the City who exercise any responsibility in the review, approval, or implementation of the proposal shall participate in any decision, which affects his or her direct or indirect financial interests. (b) It is a breach of ethical standards for any person to offer, give or agree to give any City employee or Council person, or for any City employee or Council person to solicit, demand, accept or agree to accept form another person or agency, a gratuity or an offer of employment whenever a reasonable prudent person would conclude that such consideration was motivated by an individual, group or corporate desire to obtain special, preferential or more favorable treatment than is normally accorded the general public. (c) The Respondent shall not assign any interest in this contract and shall not transfer any interest in the same without the prior written consent of the City. (d) The Respondent shall not accept any private client or project that may place it in ethical conflict during its representation of the City. 3) Indemnification- the Broker/ Respondent(s) shall defend, indemnify and hold harmless the City of South St. Paul, its officials, employees and agents, from any and all claims, causes of action, lawsuits, damages, losses, or expenses, including attorney fees, arising out of or resulting from the Broker/Respondent's (including its officials, agents or employees) performance of the duties required under this Agreement, provided that any such claim, damages, loss or expense is attributable to bodily injury, sickness, diseases or death or to injury to or destruction of property including the loss of use resulting therefrom and is caused in whole or in part by any negligent act or omission or willful misconduct of Broker/Respondent.  4) The Broker/Respondent(s) agrees, as a condition of being awarded this RFP, to requite each of its agents, officers and employees to abide by the City of South St. Paul's policies prohibiting sexual harassment, as well as all other reasonable work rules, safety rules or policies regulating the conduct of persons on City property at all times while performing duties pursuant to this contract. The Broker/Respondent agrees and understands that a violation of any of these policies or rules constitutes a breach of the contract and sufficient grounds for immediate termination of the contract by the City. EVALUATION AND AWARD(S) The criteria to be used for the proposal evaluation include but are not limited to: (a) Qualifications (b) Proposal content (c) Ability of the broker to meet the City's need in the area of brokerage services (d) Program management (e) Quality considerations of the markets offered (f) Examples of similar work No weighting or relative importance of criteria is intended or implied by this list. An award as a result of this proposal shall be contingent upon the execution of an appropriate contract prepared by the City. Questions for Insurance Broker Candidates: 1. If you are selected as the broker for one or both of our insurance program needs, discuss how you would plan and execute transitional strategies. Identify any problems or concerns you may have with the transition. 2. The City engages a local law finn for general and civil legal matters. Do you envision any concern with working with our City Attorney on legal issues? 3. Please describe how you are going to keep us apprised of changes in laws, case law precedents, or regulations related to insurance coverage requirements. D o you envision scheduled update meetings at set intervals with the City? 4. Describe how your firm would help us evaluate and select a full range of coverage alternatives and plan designs for group health/benefit insurance plans. Describe how benchmarking to other jurisdictions would be used in this work. 5. With regard to employee health/benefit insurance programs, describe your experience with devising and implementing changes to an existing insurance program in a municipal workplace with substantial labor union presence. 6. What role and strategies would you employ with the educational and specific case needs of individual line staff members (i.e., open enrollment, individual consultation)? 7. Discuss your firm's role in the management of claims (e.g., large storm or city involved car accident). 8. Describe your firm's role in identifying, advising and maintaining complete and adequate insurance coverage for the City's assets. 9. What are your initial recommendations for improvement of the City's risk management program? 10. What differentiates your ftrm from the competition? 11. Your proposal contains a compensation proposal, if selected as the finalist are you open to additional discussion and shaping of the compensation terms?  MARSH & McLENNAN AGENCY WORLD CLASS. LOCAL TOUCH. RESPONSE TO REQUEST FOR PROPOSAL CITY OF SOUTH ST. PAUL, MINNESOTA OCTOBER 21, 2013 EXECUTIVE SUMMARY CONTENTS 1. Introduction .......................................... .................................. ........ ...... ...... .... ........... 1 2. Qualifications ....................................... ................ .. ................................................... 2 3. Scope of Services ...................... ................ ............. 3Error! Bookmark not defined. ) ) MARSH & McLENNAN AGENCY LLC EXECUTIVE SUMMARY Introduction Marsh & Mclennan Agency - Minneapolis (MMA) is pleased to be considered for the position of employee benefits, property and casualty, and workers' compensation broker for the City of South St. Paul. We take a unique approach to the insurance marketplace, with views and ideas not normally seen from our competition. We provide our clients with exceptional services, while working tirelessly to establish and maintain effective working relationships between our client and insurer(s). As we present the various features of our services platform, you will see how our action plan will benefit the City of South St. Paul by helping you maintain a successful insurance program that supports your employees, enabling them to create, maintain and support your City. MMA has extensive experience in providing insurance to companies with similar challenges to the City of South St. Paul. Currently MMA has over 5,000 clients from a variety of industries utilizing our PREVENT Service Model. This provides a strong indication of MMA's ability to serve your insurance needs. Our proposal will outline the following perceived broker expectations: - Assist with the review and completion of LMCIT renewal forms and policies. Provide clear explanations of all insurance coverage options and make recommendations based upon the current needs, growth, and interests of the City. Actively participate in all claims review and management. Assist the City of South St. Paul with the implementation and clear communication of new programs or changes to existing programs as requested, which can include attending and presenting information at Open Enrollment meetings. Assist the City in complying with laws and regulations related to employee and retiree benefits, including the Health Care Reform. Research new developments in the law and employee benefit programs on an ongoing basis. Communicate proactively and specifically with actions needed by the City to remain in compliance. Provide benchmarking statistics and assist with preparation and administration of benchmarking surveys as requested by the City of South St. Paul. Assist the City of South St. Paul with Well-Being and health management programs. Provide a robust data analytics tools, which include quality assurance, data integration, benchmarking, pred ictive modeling and risk adjustment methodologies, as well as customizable drill down capabilities. Provide actuarial analysis as required when the City needs objective pricing information (i. e. benefit change increments/decrements, impact of contribution changes) beyond that offered by an existing health, life or disability plan vendor. Understand the employee benefits program as a continuous process, not an annual event. MARSH & McLENNAN AGENCY LLC 1 EXECUTIVE SUMMARY 2 Qualifications 1. Clearly delineate which service(s) the Respondent seeks to serve as agent of record for: a. General Liability, Property/Casualty, Workers' Compensation ONLY b. Employee Benefit Insurance offerings ONLY c. BOTH A and B MMA seeks to serve as agent of record for both a and b, as listed above. At Marsh and Mclennan Agency we firmly believe that by managing total risk we can deliver a better result to our clients. Often, resources and dollars are duplicated and wasted by managing workers compensation and health insurance separately. Total risk management is becoming even more important with the roll out of the Affordable Care Act (ACA). Please see tab 19 for more details on impact of workers compensation claims due to the ACA. 2 . Briefly describe Respondent's history, number of employee, years in existence and financial status and stability. Marsh & Mclennan Agency LLC (MMA) is a division of Marsh & Mclennan Companies (MMC), the world's leading insurance broker and risk advisor. The firm was established to meet the needs of mid-sized businesses and government entities in the U.S. and operates independently from Marsh to offer commercial property, casualty, personal lines, and employee benefits to clients across the U.S. Marsh & Mclennan Companies is a global professional services firm with approximately 52,000 employees and annual revenue of $11 billion. MMC is also the parent company of Guy Carpenter, the risk and reinsurance specialist; Mercer, the provider of HR and related financial advice and services; and Oliver Wyman , the management consultancy. MMC's stock (ticker symbol: MMC) is listed on the New York, Chicago and London stock exchanges. MMC's Web Site is www.mmc.com. MMA - Minneapolis is the Upper Midwest hub of Marsh & Mclennan Agency LLC. It is one of the largest insurance agencies in the Midwest and within the top one-percent nationally when ranked independently. Begun in 1986 as RJF Agencies, MMA-Minneapolis now independently represents over $500 million premium and serves nearly 5,000 clients. On January 5, 2011 , RJF was acquired by Marsh & Mclennan Agency LLC and immediately established a name for itself. Business Insurance magazine ranks our Company as one of the "top 100 brokers of U.S. business." In 2009, we were awarded the Minnesota Business Ethics Award, which can only be awarded once to an employer. The Star Tribune named us as a Top Workplace in 2010 and again in 2011 . And in a 2010 study, an independent research firm found that 99% of customers believe our Company has met or surpassed their expectations and 95% are likely to recommend our services to others. MARSH & McLE NNAN AGENCY LLC 2 EXECUTIVE SUMMARY MMA helps companies identify, assess, mitigate, prevent, eliminate and finance risk. Its values-driven approach facilitates growth and strengthens companies using comprehensive programs that reduce the cost of organizational risk. MMA professionals are experienced in designing detailed and complex domestic and international employee benefit and business insurance programs around the unique exposures faced by complex organizations. MMA-Minneapolis currently has 5 office locations throughout Minnesota and Wisconsin and we employ a team of 150 professionals to service our clients. More information can be found under Tabs 1 and 2. 3. Detail the name(s), qualifications, experience, and professional designations of the Respondent's staff proposed to service the City's account. Amy Diedrich, Benefits Consultant Amy brings over 25 years of experience in employee benefits. Prior to joining MMA, Amy spent nearly 15 years at another national brokerage firm . Previous to her benefits consulting experience, Amy worked as the Benefits Coordinator for Minnetonka School where she served four terms as President of Local 1877. This experience enables Amy to relate to the unique environment that exists in a collectively bargained employment relationship. Amy's direct experience with public sector clients allows her to develop solutions to challenges that public sector employers often encounter. By focusing on public employers, she has a wealth of knowledge regarding state and federal legislation that affect the operations of benefit plans. Amy has worked with over 40 public employers in her career. Amy is a graduate of St. Olaf College in Northfield, MN and has received her Certified Employee Benefits Specialist (CEBS) designation and has served as an instructor for the CEBS program at the University of Minnesota. Amy was on the Board of Directors for the Minnesota Association of Health Underwriters (MAHU). Amy holds a membership with the International Society of CEBS, MASA, MSBA, and MASSO. Amy is licensed as a Life and Health Agent as well as a Property Casualty Agent. Melissa Boser, Client Advisor, Employee Benefits Melissa brings to MMA over 12 years of experience in the industry. She spent 5 years as an Account Manager on the carrier side working for both a national TPA specializing in self- funding as well as a large local HMO. These years of experience have given her great knowledge in product design, renewal process, underwriting, and carrier negotiating. From there she spent the last 7+ years at a local consulting firm building their Account Management department establishing process, procedures and training. Along with that, she also maintained a book of business specializing in large group, self-funding, and public entities. Melissa also has extensive experience facilitating insurance committees, assisting with compliance and education of employees. She has an enormous passion for the industry and her clients. She truly enjoys educating decision makers on the industry and working with HR managers and CFOs to build a long term strategy that meets employees expectations as well as management's budget expectations. She is a graduate of the University of Minnesota - Carlson School of Management. MARSH & McLENNAN AGENCY LLC 3 EXECUTIVE SUMMARY Molly McSherry, Sr. Client Analyst, Employee Benefits Molly McSherry joined MMA in May of 2008 after graduating from the University of St. Thomas with a BA in Leadership and Management. Molly started at MMA in a Customer Service Role supporting the benefits team and learning the health insurance industry. In 2009, Molly became an Account Executive and managed MMA's smallest benefit clients (2- 10 employees) as well as worked in the individual health insurance marketplace as well as became Medicare certified. Most recently, Molly works with clients over 50 employees and remains Medicare certified. Molly's knowledge of Medicare is very helpful to employers that need or want to offer coverage to retirees. Molly's main responsibilities include: coordination and implementation of benefit plan renewals for clients, review of plan documents and contracts, mitigation of service and enrollment issues, maintenance of successful client and carrier relationships, communicating new compliance and regulation changes to clients and staying current on industry and market trends, as well as helping seniors navigate the Medicare system. Ryan McArton, Senior Advisor of Regulatory Affairs Ryan holds a JD from Hamline University School of Law and has over 8 years of experience in the employee benefits and employment law industry. Most recently Ryan was the Manager of Reform and Development at OptumHealth where he was responsible for the coordination and implementation of legal and regulatory filings related to complex medical condition products. Previously Ryan served as General Counsel for a privately-owned mental health care clinic with 340 employees and independent contractors throughout six locations in Minnesota where he oversaw legal, regulatory, medical billing and general operations. Ryan will is responsible for answering day-to-day questions regarding HIPAA, Health Care Reform, ERISA, Section 125, COBRA and other state and federal employee benefit regulations . He will also create and/or edit the communication of regulatory issues and policies for distribution via client alerts, newsletter articles, white papers, etc. Lastly, Ryan conducts internal and external training through seminars, webinars, written material and social media for MMA employees, clients and prospects. Tom Nepper, Executive Vice President, Risk Management Tom brings over 31 years of experience in this industry, with 16 years at MMA. Tom will oversee the overall risk management program and will be responsible for making sure that all of the City's goals and objectives are met. With a vast range of insurance experience, Tom has been very active in the Non-profit sector of insurance. He provides a wealth of knowledge to every company that he consults. Casey Nepper, Risk Management Consultant Casey has 5 years of insurance industry experience and has a strong background in resource and personnel management. As your Risk Management Consultant, Casey will coordinate all MMA resources to ensure that your objectives are achieved on schedule. With his well-rounded business experiences, Casey understands the nuance necessary to run an effective business, while simultaneously knowing in detail what insurers are looking for when determining premiums. Since joining insurance, Casey's focus has been on serving nonprofit, human service and public entity organizations. MARSH & McLENNAN AGENCY LLC 4 EXECUTIVE SUMMARY Ann Schuler, CIC, Client Executive, Risk Management As a Client Executive, Ann handles all aspects of servicing commercial property and casualty accounts. She gets the most satisfaction from her job by responding successfully to clients' requests and knowing that her clients depend on her as their first contact when requiring help and advice. Prior to joining MMA, Ann was employed as an account executive at Rosenbloom & Rosenbloom and Acordia for a combined 16 years, where she worked on accounts that varied in both size and industry. Additional Team Members Rosie Ward, Ph.D., MPH, MCHES, Health Management Services Manager Rosie is the lead of MMA's health management consulting services. She helps organizations establish and align their health and management objectives with strategic goals to create culture that supports well-being, safety and employee engagement. She works with organizations wherever they are to build a strategy for developing culture-based initiatives to maximize leadership effectiveness, employee engagement, and safety and well-being ; this includes thorough data analysis, conducting culture surveys, strategic planning, evaluating the effectiveness of alternative wellness platforms and products, and coordinating all aspects of health management initiatives to impact organizations' effectiveness and bottom line. Rosie has a bachelor's degree in kinesiology, a master's degree in Community Health Education, and a Ph.D. in Organization and Management. In addition to several fitness certifications, she is a Master Certified Health Education Specialist, a Certified Intrinsic Coach®, a Certified Valuations Specialist and a Judgment Index™ consultant. Rosie is a published author, a national presenter and regarded as an industry thought leader who has over 19 years of experience promoting well-being, employee engagement, and transforming organizations. Emily Kratz, MS, CHES Health Management Consultant Emily brings more than 8 years of experience consulting with organizations to implement effective health management strategies. She partners with clients to help foster cultures that improve the engagement, productivity and health of employees, bringing greater cost management and profitability to the company. Rather than trying to fit employers into existing turnkey or off-the-shelf products and services that offer limited potential returns, Emily takes employers through a process designed to create both short- and long-term strategies to deliver measurable impact on their people and their bottom lines that support all areas of wellbeing-career, social, financial, physical and emotional. Emily holds a bachelor's degree in Exercise Sport Science and a master's degree in Community Health Education. She is a Certified Health Education Specialist and a Certified Intrinsic Coach®. Krysta Mitchell, HR Consultant, JD Krysta delivers strategic thinking to HR problems by blending HR experience with a law degree and legal background. She helps employers develop human resource programs that assist in the reduction of company risk and increase of employee engagement. Most recently with UTC Aerospace Systems and Target Corporation, Krysta now combines her experience as an HR profess ion~! with a legal education and background to deliver valuable consulting services, including policy and handbook development, employee screening or MARSH & McLENNAN AGENCY LLC 5 EXECUTIVE SUMMARY termination procedures, compliance training and talent management process review. You will find her complete biography under tab 20. Dawn Araya, CIC, AIC - Claims Manager Dawn oversees and facilitates claims management from inception to resolution . She has 19 years of claims experience working closely to manage claims, strategize return-to-work programs, provide trending data, and assist with claims review meetings and other loss reduction strategies. Dawn has handled claims from both the insurance company and employer sides of the table, which gives her a powerful perspective that few people possess. She is committed to reaching the most favorable outcome possible for her clients while worki ng diligently with insurance carriers and others toward that goal. Angela Wheeler, AIC - Claims Team Angela is responsible for consulting Automobile, General Liability, and Property claims. She has over 12 years of claims experience with 6 years at MMA. Angela helps employers prevent and minimize the impact of claims on their organization. Her experience working for several years at other agencies and a large national insurance carrier enables Angela to provide well-rounded advice and guidance to clients. Dan Nyberg, CRM - Claims Analyst Dan runs a quarterly trending analysis that breaks down a client's losses by location, cause of injury, and nature of injury to illustrate problem areas that have high frequency or severity. He has 7 years of MMA claims experience providing on demand loss trending that fits the clients request, monthly loss data that is broken out specific to the client's needs, estimates for upcoming experience modification factors, and complete experience modification worksheet reviews that confirm the accuracy of the current modification factor. George Wood, Employee Benefits Litigator/Attorney (on retainer) MMA has contracted with George Wood of Littler Mendelson, P.A. to provide employment and labor law advice to RJF's clients . With 31 offices across the country, Littler Mendelson provides legal advice to Fortune 500 corporations, regional employers, and small to mid-size local companies nationwide. Littler Mendelson's attorneys represent employers in every industry sector on all aspects of employment and labor law. Mr. Wood has practiced employment and labor law for 14 years, and brings a wealth of experience and practical application to employer's problems. In addition to his own experience, Mr. Wood is able to draw on the cumulative experience of Littler Mendelson's attorneys, and provide effective and efficient solutions to your employment and labor issues. Mr. Wood is located in Littler Mendelson's Minneapolis office. Bob Radecki, Senior Compliance Advisor (on retainer) Bob has devoted more than 20 years of his career to helping companies ensure and maintain compliance with employee benefits matters such as HIPAA, Section 125, COBRA, health plan design, consumer-directed health care, and Health Care Reform requirements. His common sense approach helps translate complex regulatory and legislative requirements into practical to-dos and demonstrates clearly what the requirements actually mean to employers and their employees. Bob has held positions working with and within the insurance industry; including founding and leading a firm that provided group compliance consulting to over 26,000 people across MARSH & McLENNAN AGE NCY LLC 6 EXECUTIVE SUMMARY the United States. This experience coupled with his pragmatism, formed his overarching consulting philosophy of implementing strategies that reduce an employer's risk without unnecessarily burdening staff or negatively affecting important business. 4. List experience with working with municipalities insured by the LMCIT during the last five years. Casey Nepper has been consulting the Cities of Plymouth, Brooklyn Park and Watertown. The lines of coverage that are serviced are: • City of Plymouth: All non-workers' compensation lines • City of Brooklyn Park: All lines • City of Watertown: All lines 5. Present limit of errors and omissions coverage in place for the Respondent. MMA has E&O coverage with a $15,000,000 limit each claim, $15,000,000 aggregate through Endurance American Specialty Insurance Company. A copy of the certificate is available in the Appendix. 6. Describe Respondent's service philosophy. Our service philosophy is: If you cannot measure it, you cannot manage it. Treat us as any other full-time employee. We ask our clients to complete the same service and expectation checklist that we do, and we provide an annual service timeline. This tool gives you an understanding of our job description and the ability to review our performance while determining appropriate compensation for our services. We'll review the process and timelines quarterly. MMA was founded upon the belief that employee benefit services should be viewed as an investment, possibly even an asset, rather than just another business expense. We approach our clients in a consultative manner, with the end result being a solution that reduces your cost of organizational risk and your cost of doing business. 7. Describe Respondent's marketing capabilities with emphasis on those lines of coverage requested in the RFP. MMA's employee benefits practice is licensed in all 50 states and appointed with all local, regional and national life, accident and health carriers. We have large blocks with each of the four (4) health carriers , allowing us to negotiate better prices and products for our clients. MMA also represents more than 75 different Property and Casualty insurance companies - both national and regional in scope. The following represents those companies that currently write municipality business or would be interested in the City of South St. Paul. Workers' Compensation SFM American Compensation Insurance Companies MARSH & McLENNAN AGENCY LLC 7 EXECUTIVE SUMMARY United Heartland Insurance Companies • RTW Liberty Group of Companies • Berkley Property/Casualty • League of Minnesota Cities Insurance Trust CNA Insurance Travelers General Casualty • Liberty Group of companies • Hartford • Chubb Westfield Zurich • Fireman's Fund Affiliated FM • Hanover Acuity The companies listed above have been or are currently writing city business. The LMCIT currently writes all but one city in Minnesota. Our marketplace leverage comes in three main areas: • Size of our block of business: MMA has considerable amounts of business with all carriers and we continue to grow. This allows us to use our premium volume to negotiate with each carrier. • Relationships with the carriers: MMA has a strong relationship at all levels with carriers. We develop these relationships from the top of the organizations through the underwriters and down to the service level to ensure our client's needs are met and they get exactly what they are paying for. • Data management We analyze the specific claims data of each client to determine a reasonable renewal based on market trends, ongoing risks, and alternative carrier competitiveness. We balance the lowest overall cost with the long-term effects of every renewal decision. 8. Describe Respondent's experience and expertise regarding public entity risks by relating markets to which the firm has access. As noted in question 7, we have access to all the markets. For employee benefits, due to the large national and local presence that MMA has, we are able to negotiate and leverage better options for clients. Your MMA team's main contacts each have over ten (10) years of experience supporting public sector clients. MMA has strong relationships with several national and regional carriers that actively seek to write public entities such as the City of South St. Paul. MARSH & McLENNAN AGENCY LLC 8 EXECUTIVE SUMMARY We choose our carriers with the following in mindset: • Aggressive Pricing Strategy • Outstanding Service Partner {Claims & Loss Prevention) • Creativity and Flexibility of Program Offerings • Proven Financial Track Record covering National and Regional clients MMA is currently the agent of record for the City of Plymouth, the City of Brooklyn Park, and the City of Watertown accounts, and we have many years of experience providing loss control services to approximately 30 Wisconsin municipalities. Additionally, we also service many Minnesota school districts. MMA has strong relationships with the personnel at the League of Minnesota Cities and are very familiar with negotiating price and coverage terms with the League's underwriting staff. 9. Describe Respondent's information technology capabilities. Company Website We have invested heavily in our Website to make it easy for clients to find information they are looking for. We have designed it to be more intuitive as someone is searching. For example, if you read an article related to cyber liability, the Website will also suggest other articles, upcoming events or past events that have additional information that would be useful and related. Also, because of our investment in our Website technology, we are able to post breaking news as soon as we have it. We do not need to wait for a developer. This allows us to communicate to our clients and prospects about things that may affect them as soon as they happen. For example, when there is breaking news on health care reform, we are able to post it on our Website within minutes and then send out mass and personal emails depending on what is most appropriate. Please visit www.rjfaqencies.com to see the variety of resources that we can offer. Health Care Reform We have recently focused our attention on the development of our microsite that focuses on The Affordable Care Act. This site takes you directly to our library of information and resources on this complicated and challenging topic. Decision Master® Warehouse (DMW) By obtaining a direct data feed from your insurance carrier, we are able to dissect your company's claims information in a variety of ways, including employee relationship, location and health condition. This annual report allows us to identify trends in utilization and risk factors, create more focused employee education opportunities, and anticipate the impact that plan design changes will have on your population. Furthermore, this information is useful when establishing corporate wellness initiatives MyWave MyWave is a web-based information center that provides you access to valuable HR resources, such as Legislative Guides and updates on ERISA, USERRA, COBRA, HIPAA, Medicare Part D, Health Care Reform, Section 125 and other Federal legislation that directly MARSH & McLENNAN AGENCY LLC 9 EXECUTIVE SUMMARY affects employee benefits. With a simple point and click you can get answers to common questions, useful forms, and links to other helpful sources of information. HRconnection This is a client specific website that allows the HR and executive team to communicate various company and employee benefit information to their employees. This can include plan designs, rates, provider links, carrier claim and enrollment forms, employee handbooks, job postings, company news items, etc. By providing each employee with a login, this self- service resource enables staff to easily find benefits information on their own. Risk Management MMA prides itself by being one of the most technologically advanced agencies in the country. We have been paperless for more than 10 years and our primary management system is state of the art with real-time offsite data backup capabilities. Our office is equipped with backup power generators to ensure continuous operations in the event of a disaster. MMA has online document sharing capabilities through our Web portal product, ETFile On- Demand. This provides 24/7 access to important documents to all individuals with security access at the City of South St. Paul and MMA. Since ETFile On-Demand is password protected, it is possible to grant or deny access to various documents by individual users. This collaborative tool can help ensure tasks and projects are on schedule by indicating the status and the responsible person or persons. Because it utilizes the latest technology, specified users also receive automatic email notification when documents are accessed and/or modified, keeping all team members informed. This allows us to easily collaborate in an extremely efficient and secure manner. Communication of sensitive data is no longer subject to possible interception through faxes and e-mail. ETFile On-Demand is completely HIPAA compliant. 10. Describe the steps Respondent would take in reviewing the City's current programs and in designing the changes in the programs. Include specific techniques and procedures Respondent may use to assist in identifying current and anticipated new loss exposures to the City. Employee Benefits Team We would meet with your team to begin our assessment process. Our objective is to ensure that we are knowledgeable about your benefits program goals, challenges, and successes. Upon completion of the assessment, we would prepare a working timeline Our team will initially meet weekly, then monthly, and then adopt a meeting schedule that accomplishes your goals. In addressing its responsibilities, our team will ensure the road blocks identified during the initial planning phase, and any others that arise, are addressed swiftly and to the satisfaction of the City of South St. Paul. Frequent communication is the key to understanding your current situation and where you want to be in 3-5 years, allowing us to build a strategy. A sample transition plan is below: MARSH & McLENNAN AGENCY LLC 10 EXECUTIVE SUMMARY City of South St. Paul appoints MMA as Broker of Record. X Start Introductory meeting for MMA and the City of South St. Paul X team Initiate analysis process and secure documentation of all X aspects of the existing program and relevant historical data. Week 1 Meet with the City of South St. Paul team and carriers X Address urgent outstanding issues. X Introduce MMA's program management control capabilities. X Partnership meeting to discuss goals and other issues. X Provide client service agreement detailing our key objectives, X tasks and standards for performance. Week2 Discuss introduction to union representatives X Meet to evaluate the transition, identify areas of improvement X and celebrate the success of the new relationship. Receive and analyze final renewal information from carriers (if X applicable). Week3 Present contract review analysis findings. X Conduct strategy meeting X Week4 Present execution plan for implementing basic and advanced X WeekS program tactics for 2013/2014 Risk Management Team MMA would assemble an assessment team for the City of South St. Paul in which we will • Do a pricing/Deductible/coverage analysis. • Review current insurance policies to uncover coverage gaps, limit recommendations, deductible alternatives, and funding alternatives such as self- insurance. • Review the city's loss history through an in-depth analysis of your loss runs to identify trends and help prioritize areas needing attention. • Request 10 years of loss data from the League and overlay different deductible programs for Property, Liability, Auto and Workers Comp to determine which plan MARSH & McLENNAN AGENCY LLC 11 EXECUTIVE SUMMARY would be most cost effective for the City of South St. Paul. If there is a consensus for a change, MMA would assist stakeholders with a presentation to the city council, or provide the necessary supporting documents to the council. MMA's goal is to seek a deep understanding of the City of South St. Paul through a series of 30 minute interviews with your department heads. In the course of these interviews, our team will look to identify consistent threads regarding the city's current issues, objectives, strategies and new areas of potential loss exposure. Our HR. Loss Control, Wellness Experts and Claims Representatives will prepare a stewardship report with your help to set the course for the initiatives that we agree on. A timeline would look somewhat like the following: Week 1: • Complete execution of Agent of Record Letters: (AORs would be sent to you via email for signature and returned to the prospective carriers the same day). A 10-day waiting period is required by the carrier to notify the current agent or broker (most brokers, out of professional courtesy, will waive this 10-day notification process as it is advantageous to their client). •MMA will meet with the City to provide information relative to LMCIT's renewal terms and conditions. At this point, we will jointly determine if it is necessary to market your program. Week2: • MMA will meet with LMCIT to address the up-coming renewal. This will be based on the current coverages, optional coverages, review of loss runs, underwriting criteria and updated exposures. We typically will spreadsheet your losses and prior deductibles paid to help assess the most cost effective deductibles for the city on liability and property coverages . • We will present a 60 day schedule that will set the timetable for our Assessment and PREVENT report described above. Marketing process would begin, if necessary. Beginning week 1, until renewal presentation: We will meet with appropriate City individuals to review the following: • Payrolls, Property Values, City Expenditures, and auto fleets • Current General Liability application to carrier/s • Review current loss runs • Begin Deductible Analysis for all lines of insurance: Property, Liability, Auto, Workers Compensation • Review current policies (in order to modify, enhance current coverages or request optional quotes for new coverage) Please keep in mind that this is our short-term strategy for proceeding smoothly through the renewal process. Our response to the RFP provides our overall approach to your risk management program and will be a continuous and ongoing process throughout our partnership. MARSH & McLENNAN AGENCY LLC 12 EXECUTIVE SUMMARY Loss/Risk Control/Risk Management, Wellness, HR, Legal Services MMA employs a staff of 5 full-time Risk Consultants. All of our Risk Consultants assist our clients in creating and managing their safety program and to control exposures to loss. Our process begins with an in-depth assessment of written programs, physical hazards and current safety program activities. Our consultants will then develop recommendations for improvements and provide resources for the action items the City may want to take on and manage. We can also provide on-site employee train ing, develop safety policies, facilitate safety committee meetings and provide on-going support. Our consultants help our clients in areas of fleet management by establishing written fleet guidelines, DOT compliance, assist in establishing an MVR policy and by providing employee training. Our MMA team works closely with our HR Consultant for development and implementation of risk reduction activities such as improving hiring practices, improving and making changes to employee handbooks, developing drug testing programs, and for implementing pre-hire physicals. Our Risk Consultants also work closely with our Wellness Management Consultant, Dr. Rosie Ward, PH D. for development of other risk reduction activities such as implementation of stretching programs, work hardening programs and for overall wellness improvements to impact the ability of employees to be able to physically perform their jobs. All action items that the City wishes to engage RJF in will be scheduled over the year in our PREVENT Stewardship Report that is used to measure accountability. 11 . Describe the measures Respondent takes to proactively stay abreast of changes in the marketplace, including mergers/acquisitions, pricing trends, coverages and so forth . Explain how Respondent would keep the City informed of current developments. On a regular basis, MMA hosts meetings with our vendors to discuss current issues and trends they are seeing in the marketplace. We cover strategies we can use to help our clients receive the best coverage by taking appropriate measures to ensure they are properly training , managing and protecting their companies. MMA's internal teams in turn disperse necessary information to our clients and, if requested, help implement plans and strategies. MMA's upper-Midwest office represents over 5,000 clients. To more effectively manage our clients' accounts, the Property and Casualty departments has created a team of four professionals that are responsible for keeping all of MMA's associates up to speed on market conditions, carriers' financial health, pricing trends and coverage levels. A portion of our client meetings' are always dedicated to marketplace updates, to ensure that as we approach the renewal, there are no surprises for anyone. Our service calendar will ensure that these updates are delivered in a timely manner throughout the policy term. MMA also maintains internal compliance departments that are responsible for monitoring regulatory and legislative changes that affect health and welfare benefit programs. Our compliance department is dedicated to helping clients comply with laws, regulations and notifications/reporting and monitoring legislative changes for all health and welfare benefit programs. Our standard compliance services include: MARSH & McLENNAN AGENCY LLC 13 EXECUTIVE SUMMARY • Review client- and/or vendor-prepared document drafts on employer sponsored health care, disability and life insurance benefits • Assist with preparing required health care reform employee notifications and disclosures • Provide information and guidance on government reporting requirements • Provide information and guidance on the impact of federal and state regulations In addition, we work with outside legal advisors to assist with legislation/regulatory updates and interpretation, and another legal counsel specifically for health care reform information/advice. We outsource our legal advisory services to efficiently, and more cost- effectively respond to the breadth of legal questions that we're involved in with our clients. MMA has several means of communicating legislative changes and updates. If there is a legislative change that occurs, an immediate notification goes out to our client base via e- mail notifying you of the change and what we need to do to make sure you are in compliance. We have seminars, webinars, and workshops throughout the year for our clients to keep clients abreast of emerging trends and educational opportunities. We publish electronic newsletters and compliance alerts to announce recent regulatory actions. Health Care Reform MMA considers the health care reform (HCR) legislation a "sea-change" event in health care employee benefits; and applied company resources to train its representatives regarding the recent changes. MMA has in-house subject matter experts, an HCR task force to maintain our employee intra net facilities, and an engagement with one of the leading health care reform law firms in Washington, D.C. for advice and counsel. Each member of our service team has consultative knowledge of HCR. To support this knowledge requirement, we conduct HCR training sessions led by our internal subject matter experts. Most importantly, our core service team works with each client to help them understand specific benefit implications and implement the HCR provisions within the appropriate deadlines. Each team has HCR financial models, implementation checklists and other HCR intellectual capital to support their client work. HCR now is a specific, significant discussion item in all client strategic planning sessions. 12. Describe Respondent's data privacy practices in keeping client information safe. MMA takes the privacy and security of private and confidential information seriously. To support that concern, MMA has instituted a comprehensive privacy and security program. This program implements required administrative, technical and physical safeguards to ensure that appropriate levels of protection are in place to secure confidential information in compliance with state and federal regulatory requirements (i.e. GLBA, HIPAA, HITECH, etc.). Additionally, MMA regularly reviews policies and procedures to ensure continuing compliance within the ever-changing privacy and security environment. Annually MMA conducts a mandatory two hour training course on privacy and security for all employees. In addition to the training , employees are required to take a test to ensure understanding of our policies and procedures. MARSH & McLENNAN AGENCY LLC 14 EXECUTIVE SUMMARY 13. Describe Respondent's approach and time line to obtain the best coverage and pricing for the City, as well as future design/cost containment plan. Working to optimize results for our clients is our forte. Upon obtaining the privilege of being named your agent we will work with you to create a list of goals and objectives. Based off of those lists we create priorities and then a working timeline to establish when we will meet those goals. We realize this thorough process is very important when working with unions. The more advanced planning we do the less skeptical the unions are of changes being recommended. Since they have been hearing about these changes for a while they better understand the impact it will have on their unions and also become advocates of the solutions they have helped to create. Education of your insurance committee will give members the confidence to make informed decisions and move the process forward . 14. Describe Respondent's client turnover experience within the past three (3) years. We have had a consistently high client retention rate of 95% over the last three years. 15. Disclose any conflicts and/or perceived conflicts of interest with the City. There are no known or perceived conflicts of interest with City of South St. Paul, its employees, faculty, staff, trustees, and contracted vendors of other services. 16. Provide the contact information offive (5) governmental unit clients in the State of Minnesota with whom the Respondent has had a working relationship, as a reference for the City. Include the number of participants for each group. City of Victoria • Employee Benefits • 19 employees enrolled in medical • Kelly Grinnell • kgrinnell@ci.victoria.mn.us Lyon County • Employee Benefits • 126 employees enrolled in medical • Loren Stromberg • lorenstromberg@co.lyon.mn.us Murray County • Employee Benefits • 180 employees enrolled in medical • Aurora Heard • aheard@co.murray.mn.us Inver Grove Heights School District • Property and Casualty, Workers' Compensation • Dr. Deirdre Wells • wellsd@invergrove.k12.mn.us MARSH & McLENNAN AGENCY LLC 15 EXECUTIVE SUMMARY City of Plymouth • Property and Casualty, Workers' Compensation • Givonna Kone • gkone@plymouthmn.gov 17. List Respondent's proposed fee for services, to include: a. Proposed fees for insurance brokerage and consulting for each of the three (3) years of the contract and up to three (3) additional one ( 1) year renewal terms. b. The proposal should contain the proposed fee for services in either a fixed dollar amount or as a percentage of premiums paid for coverage. c. List any additional service options, as well as the fee structure involved. d. Provide any alternate pricing proposals Respondent would like the City to consider. We have different options we can offer and are open to specific suggestions from the City. Our goal is to become your partner, which means that we strive to find common ground where both companies are comfortable. 1. Take over for commission already built into plan, review and fully disclose those fees, making any necessary adjustments at open enrollment. 2. A flat annual fee of $22,500 for employee benefits. (i) Well Being - Basic services are provided as part of the fee. If the City of South St. Paul puts an additional $2,000 towards Well-Being services, MMA will contribute an extra $1,000 towards this effort which will provide advanced Well-being services that can be customized to the City's needs. Risk Management is proposing a fee of $12,000 with $2,000 allotted to claims management services. An additional fee of $2,000 can be charged for safety program development, ergonomic assessments, safety committed involvement, OSHA grant application, or Wellness/Health Management program development. MMA will provide an additional 10% discount if offered both lines of coverage. MARSH & McLENNAN AGENCY LLC 16 EXECUTIVE SUMMARY 3 Scope of Services Our MMA team wants to address some other services that we offer that may be of interest to the City of South St. Paul. After reviewing your scope of services, we found that we are able to offer many solutions and assistance to the areas of concern. 1. Employee Education We firmly believe education is a key foundation for managing employee benefits and risk. Employees need to understand how their benefits work, how to get the most out of the coverage they are provided and how to use it economically. There needs to be a consistent message that regular goes out to employees about important messages and proper use of the benefits. We have extensive experience facilitating insurance committees. These committees help empower employees and gaining the confidence of all committee members. Please see tabs 10 through 14 for samples of employee benefits presentations and guides. 2. Benchmarking Surveys MMA has a wide range of benchmarking surveys, data and resources that we can provide. Vendors continuously provide us with benchmarking data that we can present to our clients when helping them make the best insurance decisions. Our team has a wealth of knowledge working with benchmarking plans and being a part of Marsh & Mclennan Agency allows us access to Mercer's Employee Benefits Benchmarking Survey resources and actuarial support. This benchmarking provides a standard to which you can compare the value of your benefits program with similar companies in your industry, size and geographic locations. We will utilize this information as we consider future plan design recommendations. These surveys and statistics provide benchmark data from leading consulting organizations around the country and cover the following topics: • Ancillary Benefits • Health Plans • Benefit Costs • Prescription Drugs • Benefit Management • Retirement Plans • Health Care Costs • Wellness Benefits • Health Care Reform Some of our benchmarking surveys and resources include: • Benchmarking studies to determine whether the city is within norms for both utilization and cost. • Benchmarking of the most recent 12 months of data to identify potential current concerns. MARSH & McLENNAN AGENCY LLC 17 EXECUTIVE SUMMARY • Benchmarking cost drivers over the previous 3-5 year period to determine healthcare and workers' compensation trends within the company. • Once the benchmarks are available, we work with our underwriting partners to create predictive modeling, provide future budgeting and set appropriate level of risk for the City. MMA would also be happy to use, improve, and apply any benchmarking tools that the City of South St. Paul is already working with. As a partner of the City of South St. Paul, our goal is to share all of our resources and knowledge to help you become a thriving entity. Please see tabs 6 and 7 for more information. 3. Insurance Committees Amy Diedrich and Melissa Boser, the City of South St. Paul's Team leads, have worked facilitating and supporting many insurance committees for public entities. They have worked closely with administration to lead, assist, and drive the direction and options the city, county, or school district would like to go. With a strong passion for educating all members of the committee on the insurance process, we can ensure that all members gain a full, working knowledge of how their insurance plans function. From this, MMA team is able to build a strong relationship with our clients built on trust and knowledge. Ultimately, MMA's goal through assisting insurance committees is to find the optimal design of plans that balance the needs of each entity and their commitment to their employees with quality benefits. 4. Claims Review and Management Our claims team has a range and depth of experience that allow them to be a great resource to all of our clients. On a regular basis they assist with: • Review of open claims with reserves greater than $10,000 up to three times a year. • Coordinate claims review with partner carriers. • Review all open workers' compensation claims that are impacting the City's experience mod, regardless of dollar value. • Review of experience mod worksheet to confirm its accuracy. • Re-file requests made on behalf of the client. • Deliver Experience Mod Projections that assist with planning or budgeting. • Provide claims trending analysis that tracks frequency and severity. • Customize trending analysis based on client needs (department, type of injury, etc.) • Provide Workers' Compensation Employer training. 5. Compliance with Laws and Regulations Ryan McArton, Senior Advisor of Regulatory Affairs Ryan will help the City answer day-to-day questions regarding HIPAA, Health Care Reform, ERISA, Section 125, COBRA and other state and federal employee benefit regulations. He will also create and/or edit the communication of regulatory issues and policies for distribution via client alerts, newsletter articles, white papers, etc. Lastly, Ryan can conduct MARSH & McLENNAN AGENCY LLC 2 EXECUTIVE SUMMARY training through seminars, webinars, written material and social media for MMA employees, clients and prospects. You will find his complete biography under tab 18. Krysta Mitchell, HR Consultant, JD Krysta delivers strategic thinking to HR problems by blending HR experience with a law degree and legal background. She can help access your current HR practices through audits and surveys to determine any risks the City may be susceptible to. In order to ensure that a true impact is being made, Krysta takes great care to customize tools she uses, education she implements and advice she provides. Please see tab 20 for a list of the services Krysta can provide. MyWave MyWave is a web-based information center that provides you access to valuable HR resources, such as Legislative Guides and updates on ERISA, USERRA, COBRA, HIPAA, Medicare Part D, Health Care Reform , Section 125 and other Federal legislation that directly affects employee benefits. With a simple point and click you can get answers to common questions, useful forms, and links to other helpful sources of information. You will find more information about MyWave under Tab 21 . Risk Management Information System The MMA Risk Management Center is a powerful risk management information system that provides unlimited access to employment risk prevention tools and materials. The searchable databases offer HR, benefits, safety and loss control checklists, policies, forms and information. You also get software that can help manage your risks more easily and reduce losses. The Center can be accessed online from any computer workstation at any time. Along with our in-house Compliance Specialist, we have access to Mercer's Regulatory Resources Group (RRG) and Washington Resource Group (WRG) to determine how current and proposed regulations impact our clients. In addition, the RRG and WRG partner to develop new tools and to support go-to-market efforts around major compliance consulting initiatives, such as HIPAA, Health Care Reform and compliance reviews. In addition, MMA works with several law firms depending on the needs of our clients. Employment Law Hotline Get up to 60 minutes of legal counsel each month from Attorney George R. Wood of Littler Mendelson via phone or email. Littler works with companies of all sizes to minimize litigation risk and to provide counsel on employment issues, and is the largest law firm in the United States to represent management exclusively in employment law, employee benefits and labor relations. Learn more at www.littler.com. Human Resource Hotline Get up to 60 minutes of human resource advice each month via phone or email from an MMA HR consultant. This can help you develop effective, efficient HR practices to hire and retain the right people, keep them motivated, maintain a strong culture and ensure company policies are current and understood, all of which can help you prevent losses. This can also help you with compliance concerns and understanding your responsibilities and rights as an employer. More information can be found under Tab 20. MARSH & McLENNAN AGENCY LLC 3  M ARSH & M e LEN NAN AGENCY TABLE OF CONTENTS 1. About MMA 2. National/International Capabilities 3. Strategic Planning 4. Claim Reports 5. Claim Analysis 6. Actuarial Services 7. Benchmark Survey 8. Renewal Analysis 9. Budget Analysis 10. Enrollment Presentation 11 . Enrollment Guide 12. Benefits Statements 13. Education Samples 14. HRconnection 15. Health Management 16. Consumerism 17. Health Advocate 18. Compliance 19. Health Care Reform 20. HR Consulting 21 . HR Portal 22. MMA Events 23. Compensation and Disclosures WORLD CLASS. LOCAL TOUCH.