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Blue Cross and Blue Shield of Minnesota <br />3535 Blue Cross Road, Eagan, Minnesota 55122 <br />Contractor Agreement <br />3. Compensation <br />A. For the Services described herein, BCBSM shall pay Contractor fees for actual costs for <br />items listed in Appendix A, Budget. <br />B. Total fees under this Agreement will not exceed $35,000. <br />4. Payments <br />A. Method of Payment <br />1.. Unspent Advance Funds <br />Notwithstanding the advance payment provisions below, Contractor agrees to repay any <br />unspent advanced funds within sixty (60) days of written request by BCBSM, following <br />financial report reconciliation procedures set forth in this section. <br />2. Payment <br />Contractor is eligible to receive an advance payment of up to 20% of their contract amount <br />upon the signing of the contract. To receive the advance, contractor must complete and <br />submit an Advance Request form to BCBSM Project Manager. <br />Subsequent payments to Contractor will be made on a reimbursement basis based on the <br />actual costs the Contractor incurs for the deliverables stated in this contract. The contractor <br />will submit requests for reimbursement using the Invoice form provided by BCBSM, <br />At the last billing cycle, BCBSM will reconcile the total amount that was paid to the <br />Contractor to the total amount of expenditures Contractor incurred on this contract. The <br />total amount paid to contractor (including advance payments) must equal the total expenses <br />for the contract. If the total amount paid to the Contractor is greater than the total expenses <br />incurred, the Contractor will pay BCBSM the difference. <br />B. The following expenses will not be reimbursed by BCBSM under this agreement. <br />1. Capital purchases <br />2. Provision of alcohol, tobacco, or other controlled substances <br />3. Gifts for staff <br />4. Pay down existing debt <br />BCBSM Project Manager will communicate to Contractor any additional expenses that <br />will not be reimbursed. The effective date will be the date given in the notice and will <br />apply only to expenses from that date forward. It Will not be applied retroactively. <br />C. BCBSM will not reimburse for costs that were incurred for activity either before the start <br />date or after the end date of this contract stated in this contract: <br />D. Indirect or administrative costs <br />Indirect or administrative expenses on this contract cannot exceed 15% of direct costs. <br />Contractor should not automatically include 15% as their indirect rate. There needs to be a <br />method to the calculation of the indirectladministrative expense rate or amount, and upon <br />our request, you may be asked to explain the calculation. <br />Indirect costs are those costs that are intended to cover contract- related costs that are not <br />easily identifiable, but are necessary to .conduct the work. Indirect costs are the types of <br />expenses the organization Mould incur whether or not it was awarded the contract. <br />Page 3 of 5 <br />