INTERGOVERNMENTAL RISK MANAGEMENT AGENCY The Risk Management Solution for Local Government COVERAGE, CLAIMS & LITIGATION COMMITTEE Meeting Agenda Thursday, September 17, 2020 Zoom Meeting 1:30 p.m. I. CALL TO ORDER II. APPROVAL OF MINUTES ✓ May 20, 2020 (pg. 1) III. MILLIMAN – PREDICTIVE MODELING REPORT (pg. 3) A. ✓ Renewed Predictive Model Proposal (pg. 24) IV. CLAIMS & LITIGATION REPORTS A. Litigation Reports 1. New Litigated Claims Report – May – August 2020 (pg. 32) 2. Closed Litigated Claims Report – May – August 2020 (pg. 33) 3. Attorney Fees and Expenses GL & WC (pg. 35) 4. GL Outcome Summary by Disposition (pg. 40) 5. Subrogation Reports GL & WC (pg. 42) V. ✓ 2021 COVERAGE RENEWAL (To be distributed) VI. ✓ REINSURANCE BROKER RFP (pg. 44) ✓A. Guy Carpenter Agreement (pg. 44) VII. ✓ 2021 PRELIMINARY BUDGET (pg. 61) VIII. ✓ ELECTRIC UTILITY EXCLUSION (pg. 130) IX. ADDITIONS TO AGENDA X. EXECUTIVE SESSION-OPTIONAL FOR DISCUSSION OF CLOSED SESSION MINUTES XI. ✓ APPROVAL OF CLOSED SESSION MINUTES ➢ Review/Discussion – Executive Session Meeting Minutes of May 20, 2020 (To be emailed) XII. CONFIRMATION OF NEXT MEETING Thursday, November 5, 2020 9:30 a.m. - IRMA Office XIII. ADJOURNMENT To ensure a quorum, please contact Donna Morin at [email protected] or (708) 236-6349, if you are not able to attend the meeting. Copy to: Julia Cedillo, IRMA Chair INTERGOVERNMENTAL RISK MANAGEMENT AGENCY The Risk Management Solution for Local Government COVERAGE, CLAIMS & LITIGATION COMMITTEE Meeting Minutes Wednesday, May 20, 2020 Zoom Meeting – 9:30 a.m. PRESENT: Peggy Halik, Chair Jason Bielawski, Vice-Chair John DuRocher Peter Vadopalas Greg Van Dahm Kay Argo ALSO PRESENT: Margo Ely Susan Garvey Donna Morin Mike Metzger Margie Zarcone Mike Paczolt Mike Waterman Embry Nichols Isabella Pang James Turner Jenny Emery ABSENT: Doris Harmon-Warren I. CALL TO ORDER Chair Halik called the meeting to order at 9:32 a.m., roll was taken and a quorum declared. II. APPROVAL OF MINUTES A motion was made by DuRocher and seconded by Van Dahm to approve the minutes of February 13, 2020. A voice vote was called and the motion carried. III. IRMA RESPONSE TO CORONAVIRUS – BRIEF PRESENTATION Ely gave a quick overview of IRMA’s COVID-19 page to the committee of where they could find the resources pertaining to the pandemic. IV. MILLIMAN – PREDICTIVE MODELING REPORT Paczolt gave an overview of the predictive modeling report to the committee. V. GUY CARPENTER PRESENTATION A presentation on the insurance market status and the renewal strategy was given to the committee by Waterman, Turner, Pang and Nichols from Guy Carpenter with some feedback from Jenny Emery. Guy Carpenter reported that rates will continue to go up and capacity will be reduced for the forseeable future. The committee agreed with Guy Carpenters and staff recommendations to broadly market the program and to make no change to the current coverage structure unless pricing comes in extremely high in which case flexibility of alternative coverage options should be explored. 1 Coverage, Claims & Litigation Committee Meeting Minutes May 20, 2020 Page 2 VI. CLAIMS & LITIGATION REPORTS Reports were provided to the committee for information. VII. COVERAGE ANALYSIS FOR LOSS OF SALES TAX REVENUE AND BUSINESS INCOME Garvey gave an overview of the loss of sales tax revenue and business income interruption coverage. Garvey advised the committee based upon current Illinois law and the terms of the first party property coverage, it is unlikely there would be coverage for any claims. The committee understood and agreed with the analysis. A motion was made by Bielawski and seconded by Vadopalas to accept staff’s analysis. The motion carried. X. CLOSED MEETING A motion was made by Argo and seconded by Bielawski to move into Closed Meeting to discuss matters of: review of closed meeting minutes and Executive Director’s Performance Review pursuant to 5 ILCS 120/2(c)(1). A roll call vote was called and the motion carried. ****************** Back in regular session, a motion was made by Argo and seconded by Van Dahm to approve the Closed Meeting Minutes of February 13, 2020. A voice vote was called and the motion carried. XI. CONFIRMATION OF NEXT MEETING Halik reported that the next scheduled meeting of the CCLC would be Thursday, September 17, 2020 at 1:30 p.m. at the IRMA Office. XII. ADJOURNMENT A motion was made by Argo and seconded by Van Dahm to adjourn the meeting. A voice vote was called and the motion carried. Submitted by: Accepted by: _____________________________ ______________________________ Susan Garvey Peggy Halik Director of Legal Services Chair, Coverage, Claims & Litigation Committee G:\Committees\Coverage, Claims & Litigation Committee\2020\9-17-20\CCLCMeetingMinutes-052020.docx 2 Performance Report - CCLC Intergovernmental Risk Management Agency SEPTEMBER 8, 2020 3 Executive Summary Nodal has scored over 2,100 claims for IRMA cycle time (time to claim closure); • More co-morbidity references in adjuster since going live on October 1, 2017. The however, cycle time has slowed down in notes – more than double the historical objective of Nodal is to use predictive models to 2020. rate. The IRMA claims team has been efficiently triage claims shortly after they are recording height, weight, and BMI which reported. These indications are very promising and show may also be causing an increase in the value in utilizing predictive analytics. We will number of claims with references to Since the inception of the program, Nodal continue to monitor these metrics for IRMA going overweight or obese. While this does correctly identified 17 of the 20 largest forward. flag more claims now, in the long run claims for IRMA within 30 days. Nodal notified Recent trends in the data include the following: more thorough notes will help improve IRMA management of these claims for additional model performance. oversight. • 2020 severity seems to be developing very favorably so far. • Higher TTD payments within 30 days Based on the last 2.5+ years of claims, we have (although average medical payments begun to measure savings. Before going live, we • Claims are closing slower in 2020. We will have decreased) expected savings of 3 to 10%, or $530k to continue to monitor this to determine if the $1.8m annually. So far, savings are within or trend continues or if this is due to sample size. We are very happy with the performance of exceeding that range. Nodal over the past year and believe we can • We continue to see more than expected continue to achieve significant return on 1 • 2018-2020 claim severity is down number of claims scoring greater than 850. investment in the future. approximately 10-12% from 2014-2017 This is primarily driven by significant increases in the following characteristics: • The lower severity is driven primarily by reductions in medical claim costs • More surgery references in adjuster notes – nearly double the historical rate • 2018-2019 claims had seen improvement in 1Claim severity is the average cost per claim. Confidential 2 4 Large Claim Scoring Success 17 of the 20 largest claims since implementation (10/1/17) were flagged for further review by Nodal. Claim Information Adjuster Note References within 30 days of Report Date Auto Pay Jumper Total Paid Claim Date Score Score as of Number Reported Location Department Nature Injury Body Part @3 days @30 days 8/28/2020 Status Opioids Attorney MRI Co Morbidity Hospital Surgery 173496-01 4/5/2018 Mundelein Fire Multiple Injury Back-Lower 982 986 $372,494 Open ● ● ● 173313-01 3/5/2018 Libertyville Fire Strain/Sprain Shoulder 983 986 351,101 Closed ● ● ● ● 173708-01 5/10/2018 Hazel Crest Fire Strain/Sprain Ankle 830 963 342,069 Open ● ● ● ● 173549-01 4/13/2018 Mundelein Fire Spondylosis Neck NA 997 336,189 Closed ● ● ● ● 172496-01 10/18/2017 Morton Grove Police Lumbar Fusion/single level Back-Lower 934 962 331,670 Closed ● ● ● ● 173101-01 2/2/2018 Clarendon Hills Public Works Multiple Injury Multiple Body Parts 673 956 264,137 Open ● ● ● 174699-01 10/15/2018 Winfield Fire Total Hip Replacement Hip-Left 983 881 251,004 Open ● ● ● ● 177200-01 11/18/2019 Arlington Heights Police Strain/Sprain Hips/Buttocks 891 980 246,565 Open ● ● 174190-01 7/30/2018 Brookfield Police Multiple Injury Multiple Body Parts 999 991 240,731 Closed ● ● ● 175136-01 1/3/2019 Woodridge Police Strain/Sprain Multiple Body Parts 461 931 236,797 Open ● 177044-02 10/22/2019 Riverside Police Strain/Sprain Multiple Body Parts 491 912 217,632 Open ● ● 175546-01 2/21/2019 Lake Zurich Fire Multiple Injury Shoulder 998 960 213,312 Open ● ● ● ● 174590-01 9/28/2018 Arlington Heights Police Strain/Sprain Back-Lower 633 987 206,304 Open ● ● 175686-01 3/13/2019 Lisle Police Strain/Sprain Shoulder 986 988 198,365 Open ● ● ● 173457-01 3/23/2018 Lake Bluff Fire Multiple Injury Shoulder(s)-Right NA 833 186,729 Open ● ● 174549-01 9/21/2018 Arlington Heights Fire Cervical Disc Replacement Neck 799 997 177,909 Closed ● ● ● ● 175759-01 3/27/2019 Crystal Lake Administration Strain/Sprain Shoulder 628 996 175,868 Closed ● ● ● ● 173734-01 5/15/2018 Palos Heights Public Works Fracture/Break Shoulder(s)-Left 990 956 175,432 Open ● ● ● 172693-01 11/20/2017 Morton Grove Police Cervical Fusion Neck NA 512 172,712 Open 172526-01 10/23/2017 Morton Grove Fire Multiple Injury Shoulder 919 949 159,698 Closed ● ● ● *Some claims are not in the database within 3 days of report date. 174699-01: near miss 173457-01: near miss 172693-01: minimal info in first 30 days other than cervical injury with previous cervical fusion. Confidential 3 5 Claim Severity 2018-2020 claim severity* is coming in about 10-12% lower than 2014-2017.