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REQUEST TO EXERCISE THE CONTRACT’S SECOND ONE (1) YEAR EXTENSION OPTION WITH CANNON COCHRAN MANAGEMENT SERVICES, INC. FOR THIRD-PARTY WORKERS COMPENSATION ADMINISTRATIVE SERVICES:
SPECIFICATION P-22017
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To the Honorable Board of Commissioners of the Chicago Park District
I. Initial Award Information; Authorization
Pursuant to Chapter XI, Section C.3.a of the Code of the Chicago Park District, the Director of Purchasing and the Director of Risk Management recommend that the Board of Commissioners of the Chicago Park District (“Board”) authorize the General Superintendent or their designee to exercise the second one (1)-year extension option on the contract (Specification No. P-22017) (the “Contract”) with Cannon Cochran Management Services, Inc. (“CCMSI”) for third-party administrative (TPA) services. CCMSI was selected pursuant to a publicly advertised request for proposals.
Date of Award: August 9, 2023 Board Meeting
Contractor: Cannon Cochran Management Services, Inc.
550 West Van Buren Street
Chicago, IL 60607
Company Type: Delaware Corporation
Majority Interest: 97.5% Employee Stock Ownership Plan
Contract Period: Two (2) year initial term with three one (1) year extension option. If extensions options are exercised, funding shall be based upon annual appropriations.
Contract Amount: Not-to-exceed $168,565.00 for the one-year contract extension.
Scope of Services: CCMSI’s responsibilities include, but are not limited to, the following: 1) effectively managing workers compensation claims that result in i) containment of costs; ii) constructive communication and coordination with all interested and affected parties; iii) education of employees; and iv) maintenance of adequate reserves; 2) reducing expenses and simplifying program administration; 3)initiating prompt investigation and determination of liability; and 4) establishing practical, measurable, and attainable standards against which the Park District can evaluate the effectiveness of the program. This description of Services is intended to be general in nature and is neither a complete description nor a limitation on the Services that CCMSI is to provide under the Contract.
II. Performance to Date:
CCMSI has been the third-party claims administrator for the Chicago Park District for over fifteen (15) years. Under CCMSI’s administration during this current Contract, the average cost-per-claim has gone down from $24,898 in 2023 to $15,457 in 2025. The average length of time closing claims went down from 327 days in 2023 to 298 days in 2025. The total number of claims has gone down from over 300 to 138 currently. CCMSI has maintained its status in good standing as a contractor and performed its duties in an efficient and timely manner.
III. Current Expenditures:
Contract Start Date: October 1, 2023
Contract End Date: September 30, 2026
Contract Amount: $327,312.00 for the initial Contract term
Payments to Date: $409,140 for the initial Contract term and 1 year extension.
IV. Current MBE/WBE Compliance
Original Goals: MBE: 25%
WBE: 5%
Current Compliance: MBE 25.02%
WBE 4.14%
Current Compliance shows the levels of MBE/WBE participation at the time this information was gathered for the Board Letter. With additional payments to CCMSI and subcontractors being submitted and reconciled for this contract, CCMSI is expected to meet, if not exceed, the 5% WBE requirements of this contract by the end of the term.
V. Explanation of Recommendation
The Risk Management Department is responsible for the Chicago Park District’s Workers Compensation (WC) self-insured program. Workers’ Compensation (WC) provides benefits to Chicago Park District employees who sustain work-related injuries or illnesses arising out of and during the course and scope of employment. These benefits include payment for medical treatment, prescriptions, and other expenses related to the injury or illness. Benefits may also include payment for lost time from work due to injury or illness, depending on the number of days the employee is off work. The program is currently administered by third-party administrator CCMSI. Having this Contract in place will allow the Risk Management Department to efficiently meet the Park District’s obligations to efficiently evaluate claims and administer benefits to injured employees.
Therefore, it is in the best interest of the Chicago Park District to grant the second of three one (1) year extension option, with the negotiated prices and no change to the Contract value, to CCMSI with a new end date of September 30, 2027.
VI. General Conditions
1. Conflicts: No agreement authorized herein shall be legally binding on the Chicago Park District if entered into in violation of the provisions of the Public Officer Prohibited Activities Act, 50 ILCS 105/0.01 et seq.
2. Ethics: The Extension Agreement shall contain a provision requiring compliance with Chapter III of the Code of the Chicago Park District (“Governmental Ethics”).
3. Contingent Liability: Any agreement lawfully entered into for a period of more than one year shall be executory only for the amounts for which the Park District may become liable in succeeding fiscal years pursuant to 70 ILCS 1505/17(i).
4. Economic Disclosure Statement (“EDS”): CCMSI has submitted a full and complete EDS prior to submission to the Board.