SR-12-15-2015-3A
City Council
Report
City Council Special Meeting: December 15, 2015
Agenda Item: 3.A
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To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Risk Management
Administration
Subject: Award Agreement to TCS Risk Management Services, LLC for Workers’
Compensation Program Data Analysis and Reporting Services
Recommended Action
Staff recommends that the City Council:
1. Award Request for Proposal (RFP) # 54 to TCS Risk Management Services, LLC, a
California-based company, for workers’ compensation program data analysis and
reporting services; and
2. Authorize the City Manager to negotiate a five year professional services agreement
with TCS Risk Management Services, LLC in an amount not to exceed $212,500,
with future funding contingent on Council budget approval.
Executive Summary
Staff recently solicited proposals from consultants for workers’ compensation program
data analysis and reporting services. The City received one response to the proposal,
and it came from the consulting firm currently providing this assistance, TCS Risk
Management Services, LLC (TCS). In light of this, staff verified the RFP was distributed
to qualified firms and sought their feedback on the limited response. This effort satisfied
staff that reissuing the RFP would not attract additional proposals. Staff subsequently
moved ahead with confirming TCS’s submittal met the requirements of the RFP and
offered competitive pricing. As such, staff recommends the City pursue a five year
contract with TCS for an amount not to exceed $212,500. Funding for the agreement is
contained in the Workers’ Compensation Self-Insurance Fund which is financed with
contributions from all City Departments.
Background
Controlling the City’s escalating workers’ compensation costs continues to be a priority.
Critical to this effort is the availability of in-depth analyses and reporting tools that
provide staff with the ability to effectively monitor and manage program performance.
Generating data of this sophisticated nature, however, exceeds the capabilities of the
City’s current risk management information system (RMIS). Therefore, it has been
necessary to hire a consultant to download and analyze the City’s workers’
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compensation claims and financial data, and prepare the required analyses and reports.
TCS Risk Management Services, LLC has fulfilled this role for the City since December
of 2010. TCS’s current contract, awarded by the Council on December 11, 2012, is set
to expire on December 31, 2015 (Attachment A).
Discussion
At the onset of the consulting contract with TCS Risk Management Services, LLC
(TCS), staff developed a set of key performance measures to assess the City’s
Workers’ Compensation Program’s financial and operational performance. Since then,
the consultant has tracked, analyzed, and reported to the City on these measures on a
quarterly basis. This information has provided Finance staff with the tools to proactively
monitor program performance (e.g., isolate program trends down to the division level,
gauge the effectiveness of individual cost containment initiatives, etc.); encourage
departmental participation in program management; develop new cost-control
strategies; and concisely report the program’s financial and operational standing to key
stakeholders.
Given the value of these services, staff recommends the City continue to use a workers’
compensation consultant to prepare quarterly, in-depth program performance analyses.
Further, staff envisions a need for these services well into the future. Even the state -of-
the-art risk management information systems currently under evaluation by staff to
replace the City’s outdated system are not geared to generate the type of analyses
provided through this agreement. Consequently, staff prepared and released an RFP
with a scope of work that mirrors the current agreement. The results of this process a re
detailed below.
Vendor/Consultant Selection
On October 1, 2015, the City issued an RFP for workers’ compensation data analysis
and reporting services. The RFP was posted on the City’s on-line bidding site, and
notices were advertised in the Santa Monica Daily Press in accordance with City
Charter and Municipal Code provisions. Ninety vendors were notified of the RFP; 24
vendors downloaded the RFP. TCS, the City’s current workers’ compensation
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consultant, submitted the only response to the RFP.
Given the small pool of consultants who perform the type of specialized workers’
compensation data analysis services requested in the RFP, the single vendor response
was not surprising. That said, staff verified the RFP was distributed to qualified firms
and surveyed vendors for feedback on the limited response. The effort yielded two
responses (i.e., one vendor was not interested, the other was relocating across the
country) and satisfied staff that reissuing the RFP would not attract additional proposals.
Staff subsequently moved ahead with confirming that TCS’s proposal met the RFP’s
minimum requirements and offered competitive pricing. As such, staff recommends the
City pursue a five year agreement with TCS for a total amount not to exceed $212,500.
Financial Impacts and Budget Actions
The agreement to be awarded to TCS is for an amount not to exceed $212,500. First
year costs will total $41,100, of which half, $20,550, is included in the Finance
Department’s FY 2015-16 budget (the agreement runs on a calendar year basis). The
cost of the agreement will then increase by 1.7% each year thereafter. All agreement
expenses will be charged to account 59235.555060. Future year funding is contingent
on Council budget approval.
Prepared By: Deb Hossli, Risk Manager
Approved
Forwarded to Council
Attachments:
A. December 11, 2012 Staff Report (Weblink)
Reference:
Agreement No.
10234
(CCS)