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HomeMy WebLinkAboutAMERICAN STOP LOSS - CONTRACT - RFP - P682 BENEFITS10 1 SECTION I SECTION H SCHEDULE DEFINITIONS SECTION III COVERAGE AND CLAIMS BASIS Specific Excess Insurance SECTION IV DUTIES OF THE INSURED ADMINISTRATOR SECTION V PLAN CHANGES SECTION VI SECTION VH LIMITATIONS EXCLUSIONS SECTION VHI HOLD HARMLESS SECTION IX GENERAL PROVISIONS PAGE NO A 1 4 6 7 8 9 11 13 14 300 UC SECTION IV DUTIES OF THE INSURED (Continued) ADMINISTRATOR (5) the Insured agrees to pay all clean claims under the Plan within 30 days from the date of receipt of adequate proof of such claims unless it is shown that it was not possible to do so within reason Failure of the Insured to pay any claims within the time ]mots shall cause such claim to be excluded from counting towards the satisfaction of the Specific Retention Amount A clean claim is any claan submitted by a Covered Person or any provider which (a) contains all the information necessary for the Insured or Administrator to calculate the proper payment due under the Plan and (b) which is not delayed due to any coordination of benefits provision or administration thereof investigation of any pre-existing conditions, investigation of a potential Plan limitation or exclusion investigation of potential fraud or abuse or (c) for which the Insured or Admimstrator does not have reason to believe that the claim is for any reason inaccurate Upon receipt of all required information or at the conclusion of any investigation of a claim such claim shall be deemed a clean claim and if payable under the terms and conditions of the Plan, shall be paid within 30 days of the date the information was received or the date the investigation was concluded ADMINISTRATOR The Insured may retain, employ or designate an entity or third party as a Third Party Admi mstrator ( Admuustrator') to perform any or all of the duties listed above who shall at all tunes provide adequate staff to process and pay claims on a timely basis The Administrator must be approved by the Company however such Admmnstrator shall be retained and compensated by the Insured and shall not be considered an agent of the Company The fact that an Administrator performs duties on behalf of the Insured shall not relieve the Insured from the duties and obligations listed herein actions taken by the Administrator shall be deemed actions taken by the Insured The Insured will provide the Company with a copy of the Insured's written agreement with its Administrator and all amendments thereto The Insured agrees that a copy of any future amendments to or change in said agreement shall be provided to the Company prior to the time it becomes effective CHANGE IN ADMINISTRATOR The Adrnimstrator shall not be changed unless prior written agreement is obtained from the Company If the Company is not notified of the change or if such a change is not approved by the Company, ttus Contract at the election of the Company, shall terminate as of the date such change is made If the Company approves the change in the Administrator changes in the terms of this Contract may be required by the Company If the Insured does not accept the changes so made to the Contract the Insured may terminate this Contract by giving written notice to the Company with 31 days' notice of said changes 300 UC SECTION V PLAN CHANGES If there are any Plan Changes made while this Contract is in effect, or if the Company's obligations and liability otherwise increase under this Contract because of any change in the Plan such change or increase shall not be binding upon the Company unless the Insured gives written notice to the Company at least 30 days prior to the effective date of the change and 2 such change is accepted by the Company If the Company's obligations and liabilities increase, the Company has the right, if it accepts the change to increase the premium rates concurrent with the effective date of the change Plan Changes mean benefits payable under the Plan are modified, 2 employee units locations affiliates or subsidiaries are added or deleted, eligibility rules are modified, or 4 the number of Covered Persons increases or decreases by 25% from one Contract Month to the next 300 UC SECTION VI LIMITATIONS A PAYMENT TO COVERED PERSONS OR PROVIDERS The Company has no obligation whatsoever under this Contract to make any payment directly to any Covered Person or provider of services for any benefits provided under the Plan The Company's sole liability, if any, is to the Insured, and subject to all the terms, conditions and limitations of this Contract B COVERED PERSONS LIMITATIONS The following limitation(s) do(es) not apply Expenses incurred by a Disabled Person shall not be considered Eligible Expenses and shall not be used to satisfy the [Specific] Retention Amount regardless of whether or not such expenses have been paid under the Plan Expenses shall be considered Eligible Expenses, subject to all terms and conditions of this Contract only if they are incurred after (1) if an employee he or she has returned to active full-time work for at least one full working day or (2) if a dependent or a retiree or an individual whose coverage is being continued under the Plan by reason of COBRA the date that he or she is able to perform the duties of a person of like age and sex who is in good health Disabled Persons means those employees or retirees who on the Effective Date of this Contract are not actively at work or who are not available for active work as the direct result of illness or injury In the case of a dependent or a retiree or an individual whose coverage is being continued under the Plan by reason of COBRA the term "Disabled Person" means that on the Effective Date of this Contract, such dependent or individual, by reason of illness or injury is unable to perform the normal functions of an individual who is of like age and sex who is in good health C TAXES If by any law administrative ruling or judicial decision premium taxes should be assessed against the Insured with respect to claims paid under the Plan, the Insured shall save and hold the Company harmless from any such premium tax liability The Insured shall reimburse the Company for the amount of such premium tax liability, interest, penalty or any cost incurred by the Company as a result of such premium tax assessment Such reimbursement shall be due and payable upon receipt by the Company of notification thereof 300 UC M SECTION VI LIMITATIONS (Continued) D CLAIMS NOT CONSIDERED PAID BY THE COMPANY Notwithstanding anything to the contrary in any provision of this Contract (I) The amount of any draft or check drawn on any account for which there are not sufficient funds to cover such draft or check shall not be considered paid for the purposes of this Contract and shall not count towards the Specific Retention Amount even if such draft or check is honored by a financial institution thereafter (2)Any claim which is not paid in accordance with item (5) of Section IV Duties of the Insured of this Contract shall not be considered to be paid for purposes of counting towards the Specific Retention Amount 300 UC 0 SECTION VII EXCLUSIONS The Company will not make any payment under this Contract for any loss which is caused by or which results from 1 expenses incurred while the Plan is not in force with regards to a Covered Person for whom a claim is paid, 2 any expense incurred or paid by the Insured under any contract or service agreement other than the Plan 3 expenses paid under or through the Plan that are in excess of Reasonable and Customary charges or any amount paid which is in excess of the Plan benefits 4 expenses incurred as a result of accidental bodily injury or sickness that is employment -related or for which the Covered Person is entitled to receive benefits under any workers compensation occupational disease law or similar law whether or not such coverage is actually in force 5 expenses for the administration of claims payments or other services provided by the Admimstrator or for consulting fees or expenses of any litigation 6 war declared or undeclared invasion civil war or hostilities 7 payments made for any treatment service or supply deemed Experimental, 8 expenses incurred for any treatment service or supply which is not deemed to be Medically Necessary 9 expenses incurred for Custodial Care 10 payments under the Plan which are recoverable under the Plan's Coordination of Benefits 11 expenses which are based upon any noncompliance with any legal statute or regulation 12 expenses which are otherwise limited or excluded under the terms and conditions of this Contract or for which the Company is held harmless 13 expenses incurred which are the result of commission of or attempt to commit a felony 14 intentionally self-inflicted injury or illness 15 injury or illness which is the result of nuclear or radioactive accident 16 expenses resulting from dental vision organ transplants hearing care or weekly income for purposes of Specific Retention Amounts only 300 UC (As amended by 300 UCE 1) 10 SECTION VII EXCLUSIONS (Continued) With respect to each retired Covered Person who is eligible for benefits under Medicare, a benefit otherwise payable under this Contract shall be reduced by the amount of any similar Medicare benefits so that the total reimbursements on behalf of a Covered Person shall not exceed 100% of the Covered Person's actual expenses This provision will be administered in accordance with Federal laws and regulations It will be conclusively presumed that each Covered Person eligible for coverage under Medicare became eligible for all part of Medicare to which he or she is entitled on the earliest possible date and thereafter maintained such coverage in force 300 UC 11 SECTION VM HOLD HARMLESS It is understood and agreed that the Company is not liable for punitive exemplary or consequential damages caused by or resulting from any act or omission of the Insured the Admi ustrator or their employees the Insured holds the Company harmless from damages of any kind which are not caused by the Company s own acts or omissions It is understood and agreed the Eligible Expenses do not include, and that the Insured holds the Company harmless from expenses resulting from any extra or noncontractual damages and legal fees and expenses attendant to the defense thereof including but not lmuted to compensatory exemplary and punitive damages, fines or statutory penalties which are awarded as a result of an act omission or course of conduct committed by or for which the Insured shall be held responsible in connection with the Plan 300 UC 12 SECTION IX GENERAL PROVISIONS AUDIT The Company shall have the right to inspect and audit all records and procedures of the Insured and its Administrator and to require upon request proof of records satisfactory to the Company that payment has been made for benefits which are the basis for any claim hereunder NOTICE For the purpose of any notice required from the Company under the terms of this Contract notice to the Insured shall be deemed notice to the Administrator and notice to the Administrator shall be deemed notice to the Insured NOTICE OF CLAIM Specific Excess Insurance If Specific Excess Insurance is provided to the Insured under this Contract written notice of claim shall be given to the Company within 30 days from the date the Insured becomes aware of any and each claim that has reached 50% of the Specific Retention Amount Failure of the Insured to furnish written notice within 30 days shall not invalidate nor reduce any claim if it was not reasonably possible to give such notice within such time if such written notice is furnished as soon as reasonably possible but in no event later than 1 year after the date that written notice of claim is otherwise required The Insured and its Administrator shall submit on a timely basis all proofs reports and supporting documents pertinent to insurance under this Contract as requested by the Company NOTICE OF APPEAL Any objection notice of legal action request for review or appeal or complaint received on a claim processed under the Plan and on which it reasonably appears benefits will be payable under this Contract shall be brought to the munediate attention of the Company TIME OF PAYMENT OF CLAIMS After receipt of due proof of loss the Company will pay all benefits then due for loss covered and payable under this Contract The Company shall reimburse all clamis or any portion of any claim from the Insured within ten days after receipt of the claim by the Company If a claim or portion of a claim is contested by the Company, the Insured shall be notified in writing within 30 working days after receipt of the claim by the Company that the claim or portion of the claim is being contested or denied The notice that the claim is contested shall identify the contested portion of the claim and the reasons for contesting the claim 300 UC 13 SECTION IX GENERAL PROVISIONS (Continued) Upon receipt of any additional information requested from the Insured the Company shall pay or deny the contested claim or portion of the contested claim within 60 working days Payment under this Contract shall be treated as being made on the date a draft or other valid instrument which is equivalent to payment is placed in the United States mail in a properly addressed postpaid envelope or if not so posted on the date of delivery All overdue payments shall bear a supple interest at the rate of 10 percent per year RIGHT OF RECOVERY In the event of an overpayment under the Plan the Insured will have the right and the obligation to attempt to recover such overpayment If a benefit is paid that is greater than allowed under the Plan according to the provisions of the Plan the Covered Person will be requested to refund that overpayment If payment is made on the Covered Person's behalf to a hospital, doctor or other provider of service and that payment is found to be an overpayment the Insured will request a refund of the overpayment from the provider If the refund is not received the amount of the overpayment will be deducted from future benefits payable on behalf of the Covered Person but only if he receives prior notification that such a reduction is to be made ENTIRE CONTRACT This Contract the attached Insured s application and amendments if any are the entire contract All statements in the application are representations and not warranties No statement will be used to void this Contract or to deny a claun unless it appears in the attached copy of the application CHANGES No agent or any other person except an authorized officer of the Company has the authority to effect a waiver or change any part of this Contract or to stop the Company from asserting any right under the terms of this Contract The terms of this Contract shall not be waived or changed, except by Endorsement issued to, and which forms a part of this Contract The Company has relied upon the underwriting information provided by the Insured or the Insured s Agent or Administrator or authorized representative of the Insured in the issuance of this Contract Should subsequent information become known which if known prior to the issuance of this Contract would affect the rates retention amounts terms or conditions for coverage hereunder, the Company shall have the right to revise the rates retention amounts, terms or conditions of this Contract as of the Effective Date of this Contract Written notice of such change shall be provided to the Insured 300 UC 14 SECTION IX GENERAL PROVISIONS (Continued) CONCEALMENT. FRAUD This entire Contract shall be void if, whether before or after a claim or loss, the Insured or its Agent Administrator or authorized representative of the Insured has concealed or misrepresented any material fact or circumstance which concerns this Contract or the subject thereof including any claim there thereunder or in any case of fraud by any such entity PREMIUMS AND GRACE PERIOD Each premium for the insurance provided under this Contract is payable on or before its due date at the Home Office of the Company Payment of premium shall not maintain insurance under this Contract in force beyond the period for which such premium is paid except as otherwise stated in this Contract provision A grace period of 31 days will be allowed for the payment of each premium due after the first If any premium after the first is not paid when due all benefits provided the Insured under the Contract shall terminate upon the earliest of the following (1) upon the due date of such premium if the Insured provides written notice to the Company and the Company receives such notice on or before such date that insurance provided under this Contract shall not continue beyond such date or (2) at the end of the grace period upon receipt by the company of such written notice during the grace period or (3) at the end of the grace period The Insured shall be liable for the pro rata part of the unpaid premium during which the insurance under this Contract is continued in force after the due date of such unpaid premium If coverage terminates during the Contract Year there will be a refund of premium paid but unearned based on the Company s rules then in effect for refunding premium paid but unearned REVISED PREMIUM COMPUTATION The Company reserves the right to establish new premium rates to be effective on the first Anniversary Date after the Effective Date of this Contract or as of any Anniversary Date thereafter The Company reserves the right to revise the premium computation at any time during the Contract Year in the event that the number of Covered Units fluctuates by more than 25% from the number of Covered Units shown in the Schedule In addition the Company reserves the right to establish new premium rates coinciding with any Plan Change during the Contract Year 300 UC 15 SECTION I SCHEDULE CONTRACT NUMBER D-9565 Item I NAME OF INSURED CITY OF FORT COLLINS ADDRESS 200� —�� '�o��A �8CD ---(Street)--(Sane Number o r) FORT COLLINS, CO 80522-0580 (State) (Zip Code) Item H Initial Contract Year From JANUARY 1 2002 To DECEMBER 31, 2002 (Effective Date) (Expiration Date) Item III SPECIFIC EXCESS INSURANCE [ ] NOT PROVIDED UNDER THIS CONTRACT [ X ] PROVIDED AS FOLLOWS (a) Specific Retention Amount per individual for the Contract Year $120 000 Specific Retention Amount for the Contract Year for Rene Mclellan only $150 000 (b) Company's Lunt of Liability (Reimbursement Factor) 100 % of payments of Eligible Expenses made in excess of the Specific Retention Amount Specific Annual Maximum Amount per individual $2 000,000 300 UC A SECTION IX GENERAL PROVISIONS (Continued) TERMINATION The insurance provided under this Contract will terminate upon the earliest of the following (a) except as provided in the Premiums and Grace Period provision at the end of any period for which a premmum is due and unpaid (b) the cancellation date in accordance with the teens of the Cancellation provision, (c) the Expiration Date of the insurance provided under this Contract unless otherwise extended or renewed [or (d) the date of termination of the Plan or (e) the date on which the Insured has failed to make sufficient funds available to pay claims as required under this Contract In addition to the termination provision listed above the insurance provided under this Contract shall automatically terminate upon cancellation of the agreement between the Insured and the Admimstrator unless the Company has prior to such cancellation agreed in writing to the Insured's designation of the successor admimstrator CANCELLATION This Contract may be cancelled by the Insured by mailing to the Company written notice stating when thereafter such cancellation shall be effective In the event of cancellation by the Insured the Company shall retain the customary pro rats premium This Contract may be cancelled by the Company by mailing to the Insured written notice stating when thereafter such cancellation shall be effective Such written notice shall be given to the Insured at least 45 days prior to the effective date of the cancellation and shall include the reasons for the cancellation RENEWAL This Contract may be renewed at the option of the Company for subsequent 12-month periods by written acceptance from the Insured of the renewal terms offered by the Company The Company shall provide at least 60 days advance notice of such renewal terms and renewal premiums If this Contract is not renewed by the Company the Company shall provide at least 30 days advance notice to the Insured such notice shall include the reasons for non renewal 300 UC 16 SECTION IX GENERAL PROVISIONS (Continued) DATA REQUIRED The Insured will maintain adequate records for the insurance which are acceptable to the Company and will provide any information required by the Company to admimster the Contract The Company may periodically examine any of the Insureds records relating to the insurance under the Contract and any claims filed under the Plan CLERICAL ERROR Clerical error whether by the Insured or by the Company in keeping any records pertaining to the insurance provided under this Contract will not invalidate coverage otherwise validly in force or continue coverage otherwise validly terminated ASSIGNMENT The Insured cannot assign this Contract LEGAL ACTION No action at law or in equity shall be brought to recover on this Contract prior to the expiration of 60 days after written proof of loss has been furnished in accordance with the requirements of this Contract No such action shall be brought after the expiration of five years after the time written proof of loss is required to be furnished CONFORMITY WITH STATE STATUTES Any provision of this Contract that is in conflict with the laws of the state in which this Contract is delivered or issued for delivery is amended to conform to the minimum requirements of those laws CONFORMITY WITH FEDERAL LAW AND REGULATIONS This Contract is automatically amended to comply with any Federal law or regulation with which this Contract is not in compliance This Contract is deemed to be automatically amended on the date any Federal law or regulation is enacted which is applicable to this Contract the effective date of any such amendment will be that governed by Federal law or regulation AMENDMENTS TO THE CONTRACT The insurance provided under this Contract may be amended at any time only with the mutual consent of the Company and the Insured 300 UC 17 SECTION IX GENERAL PROVISIONS (Continued) EXAIIIINATIONS The Company shall have the right and opportunity through its medical representative to examme any living Person during the pendency of a claim and as often as it may reasonably require SUBROGATION The Insured shall prosecute any and all valid clam that the Insured may have against third parties which arise out of any occurrence and result in loss paid under the Plan The Insured shall make full report to the Company of any amounts recovered or recoverable under this provision Should the Insured fail to prosecute any valid claims against third parties and the Company thereupon becomes liable to make payments to the Insured under the terms and conditions of this Contract then the Company shall be subrogated to all rights of the Insured Any amounts recovered by the Company shall be used to pay the expenses of collection and reimbursement of the company for any amount that it may have paid or becomes liable to pay the Insured under the terms of this Contract All amounts thus remaining shall be paid to the Insured 300 UC 18 SECTION I (Continued) (c) Premium Rates Payable for the Contract Year Number of Initial Covered Units 1 389 Rate Per Unit Premium Mode (1 389) All Eligible Active & Retired Employees $16 85 Monthly Item IV AGGREGATE EXCESS INSURANCE [X] NOT PROVIDED UNDER THIS CONTRACT [I PROVIDED AS FOLLOWS Item V FIRST CONTRACT YEAR CLAIM BASIS Specific Excess Insurance PAID Aggregate Excess Insurance NOT APPLICABLE Item VI NAME OF PLAN CITY OF FORT COLLINS Effective JANUARY 1 2002 [X] With no revision [ ] With the following revisions Item VII ENDORSEMENTS NONE 300 UC C SECTION I SCHEDULE (Contmued) Item VIII APPROVED ADMINISTRATOR NATIONAL HEALTH SYSTEMS, INC ADDRESS 155 INVERNESS DRIVE WEST, SUITE 300 ENGLEWOOD CO 80112-5000 APPROVED ADMINISTRATOR PACIFICARE HEALTH PLAN ADMINISTRATORS INC ADDRESS 6455 S YOSEMITE STREET GREENWOOD VILLAGE, CO 80111 300 UC D SECTION II DEFINITIONS Other terms may be defined where they are used in this Contract 1 Contract Year means the period from the Effective Date to the Expiration Date shown in the Schedule, and any subsequent 12 consecutive months if this Contract is renewed 2 Covered Person means each person individually who is a Covered Unit or in the case of a dependent a member of a Covered Unit 3 Covered Unit means an employee an employee with dependents, a retiree an individual whose coverage is continued under the Plan by reason of the Consolidated Omnibus Budget Reconciliation Act of 1985 as amended (COBRA) or such other defined unit as agreed upon between the Insured and the Company 4 Custodial Care means care including confinement which is given to a patient when there is no active plan of treatment to improve the patients physical functional or medical condition, or when there is an active plan of treatment the patient has attained his or her maximum level of physical functional or mental ability and the plan of treatment cannot be reasonably expected to significantly improve the person's condition "Custodial Care includes, but is not limited to care primarily given to help the patient in the activities of a normal daily life The Company may rely on its medical review department or on an independent medical reviewer to determine if care including confinement is Custodial Care " The determination that care is Custodial Care" in no way implies that the care or confinement is not required by the patient it only means that no benefits for such are payable under the Contract 5 Eligible Expenses means only the charges which are covered and payable under the Plan, unless specifically excluded or lurnted by this Contract Eligible Expenses shall not include deductibles coinsurance amounts or any other expenses or claims which are not payable under the terms of the Plan or which are linuted or excluded under this Contract "Eligible Expenses' shall not include expenses which are payable or which can be reimbursed from any other source nor shall any cost of a claim payment or expense be considered an Eligible Expense 6 Experimental means any medical procedure equipment treatment or course of treatment or drugs or medicines that is meant to investigate and is limited to research This term also means techniques that are restricted to use at those centers that are capable of carrying out disciplined clinical efforts and scientific studies Experimental also includes procedures which are not proven in an objective manner to have therapeutic value or benefit Any procedure or treatment whose effectiveness is medically questionable is also deemed experimental 300 UC 1 SECTION lI DEFINITIONS (Continued) The Company determines Experimental through studies, opinions and reference to or by the American Medical Association The Federal Drug Administration the Department of Health and Human Services the National Institutes of Health the Council of Medical Specialty Societies or any other medical association or Federal program or agency that has the authority to approve medical testing and treatment 7 Incurred Date means the date the service or treatment and the supply to which it relates is provided 8 Medically Necessary means that services supplies and treatment must be generally recognized in the physician's profession as effective and essential for treatment of the injury or illness for which it is ordered and that they must be appropriate for the symptoms and consistent with the diagnosis and rendered at the appropriate level of care in the most appropriate setting based on the diagnosis To be considered 'Medically Necessary the care must be based on generally recognized and accepted standards of medical practice in the United States and it must be the type of care that could not have been omitted without an adverse effect on the patient's condition or the quality of medical care In addition services supplies and treatment will not be considered "Medically Necessary' if they are Experimental or investigational or primary linuted to research in their application to the injury or illness or if primarily for scholastic educational vocational or developmental training or if primarily for the comfort, convenience or administrative ease of the provider or of the patient or his or her family or caretaker or if it is Custodial Care The Company reserves the right to review medical care and make a determination as to whether services supplies or treatment is or is not Medically Necessary The Company may rely on its medical review department or an independent medical reviewer for determination The fact that a physician or any other health care provider may order or recommend services supplies or treatment does not of itself make them Medically Necessary 9 Paid means that funds are actually disbursed by the Plan for payment of claims incurred under the Plan Payment of clamis " is the unconditional direct payment of a claim to a Covered Person or to a health care provider 10 Paid Date means the date on which both (a) the Plan tenders payment by mail or other delivery of a draft or check and (b) the account upon which the payment is drawn contains and continues to contain sufficient funds to permit the draft or check to be honored Any draft or check not honored because of lack of sufficient funds will be subject to item D (1) of Section VI Lmutations of this Contract 300 UC N SECTION II DEFINITIONS (Continued) 11 Plan means the program of self -funded accident and sickness benefits provided to Covered Units by the Insured which (a) is written in the Plan Document that is in effect on the Effective Date of this Contract or as amended and so accepted by the Company (b) is named in Item VI of the Schedule, (c) is established in accordance with ERISA guidelines (d) complies with all required Federal regulations and (e) is attached to and forms part of this Contract 12 Reasonable and Customary means the usual charge made by an individual group or entity who renders or furnishes services treatment or supplies which are covered under the Plan In no event, however does it mean a charge in excess of the general level of charges made by others who render or furnish similar services treatments or supplies to individuals (a) who reside in the same geographical area and (b) whose illness or injury is comparable in nature or severity 13 Specific Annual Maximum Amount is the maximum amount payable under this Contract to the Insured per each Covered Person during the Contract Year 14 Specific Retention Amount means the amount which is wholly retained by the Insured as shown in the Schedule The Specific Retention Amount applies separately to each Covered Person for each Contract Year The Specific Retention Amount for each subsequent Contract Year will be determined annually by the Company 300 UC 3 SECTION lII COVERAGE AND CLAIM BASIS Specific Excess Insurance The Company will pay subject to all the terms and conditions of this Contract the Specific Excess Benefit if any to the Insured Payment under this Benefit shall be made within 60 days after the Company s acceptance of (1) satisfactory proof of loss, and (2) satisfactory proof of all payments made to or on behalf of a Covered Person for expenses paid under the Plan The Specific Excess Benefit for any Contract Year or fraction thereof is 1 the amount of payments made for all Eligible Expenses under the Plan on a Paid basis with regard to a Covered Person less 2 the Specific Retention Amount, 3 multiplied by the Reimbursement Factor The Specific Excess Benefit payable under this Contract is subject to the Specific Annual Maximum shown in the Schedule PAID BASIS means for a Contract Year the total amount of Eligible Expenses which is incurred within 90 consecutive calendar days immediately preceding the Effective Date of this Contract or on or after the Effective Date of this Contract and which is paid during the Contract Year 300 UC n SECTION IV DUTIES OF THE INSURED Notwithstanding anything to the contrary the Company and the Insured agree that the Insured shall also have the following duties and obligations under this Contract (1) the Insured shall be responsible for (a) the investigation, auditmg and adjudication including payment of all claims under the Plan and (b) the defense of any claim made, or suit brought or proceeding instituted against the Insured (2) the Insured shall maintain accurate records of all claim payments and shall make available such information as the Company may reasonably require for proof of payment for claims submitted under this Contract (3) the Insured shall provide the Company on or before the [15th] day of each and every Contract month on a reporting form supplied by the Company, the following data for the immediately preceding Contract month a number of Covered Persons b premium paid, c the percentage attained to date of any applicable Specific Retention amounts, including notification of any claim for which Eligible Expenses incurred and or paid have reached 50% of the Specific Retention Amount (4) In addition to the Notice of Clann requirements in Section IX General Provisions of this Contract the Insured and or its Adniimstrator shall immediately notify the Company of any expense incurred for a Covered Person which is a a continuous hospital or rehabilitation facility confinement of more than 30 days or b a claim for any of the following diagnoses • Severe strokes brain injury or trauma • Complication of pregnancy including premature births and multiple births with continuing hospitalization • Severe bum cases third degree burns of more than 10% of the body, or second degree burns of more than 30 % of the body • Spinal cord injuries which result in real or suspected paralysis of the limbs • Acquired Immune Deficiency Syndrome • Malignant tumors of the brain liver or pancreas • Severe trauma crushing or massive internal injuries • Mental and nervous disorders and substance abuse disorders requiring hospital confinement • Organ transplant surgery or coronary bypass or artificial implant surgery 300 UC 5