(b) In order to authorize the payment of claims for benefits audited and approved by a contract administrator or other service provider, an agreement entered into pursuant to this subdivision may provide that after claims have been audited by the contract administrator or other service provider, the contract administrator or other service provider shall periodically inform the public corporation of the total amount payable in satisfaction of the audited and approved claims, together with such other supporting information as the public corporation may require, and the public corporation may transfer moneys in that amount to the contract administrator or other service provider for disbursement to the claimants entitled thereto. Any such agreement shall provide that if a check issued by the contract administrator or other service provider in satisfaction of a claim remains unpaid after one hundred eighty days, the moneys payable in satisfaction of that claim shall be returned to the public corporation.

(c) Any agreement entered into pursuant to this subdivision shall contain, at a minimum, the following:

(i) a clear statement of the charges, fees or other compensation for the services provided under the agreement;

(ii) a statement that payment for the services provided under the agreement shall be made only after the services are rendered;

(iii) a provision stating that the contract administrator or other service provider to which functions are delegated shall be liable to the public corporation for all loss or damage that may result from any failure by the contract administrator or other service provider to discharge their duties, or from any improper or incorrect discharge of those duties, and a provision that expressly reserves to the public corporation all legal rights of set-off. The contract administrator or service provider shall save the public corporation free and harmless from any and all loss occasioned by or incurred in the performance of services under an agreement pursuant to this subdivision;

(iv) a provision requiring the contract administrator or other service provider to furnish a surety bond, irrevocable letter of credit or equivalent security, in a form and amount acceptable to the governing board of the public corporation, to secure the contract administrator's or other service provider's performance under the agreement;

(v) a provision requiring the contract administrator or service provider to establish, maintain and retain for a specified period complete and accurate books, records, documents, accounts and other evidence pertinent to performance under the agreement, and to submit quarterly and annual reports, in a form acceptable to the governing board of the public corporation, detailing the payment of claims and other activities of the contract administrator or other service provider during the relevant period. The auditing body or official of the public corporation shall have access to and may examine such books, records, documents, accounts and other evidence pertinent to performance under the agreement upon reasonable notice to the contract administrator or service provider;

(vi) a provision requiring an annual audit, and opinions thereon, by an independent certified public accountant, of the accounting procedures and internal control procedures of the contract administrator or other service provider;

(vii) a provision by which the contract administrator or other service provider agrees to maintain the confidentiality of medical records in its possession and that such confidentiality may only be waived upon the written consent of the covered person; and

(viii) a provision by which the contract administrator or other service provider acknowledges that those records maintained on behalf of the public corporation are subject to the provisions of article six of the public officers law.

(d) A contract entered into pursuant to this section shall be for a term not to exceed five years, except that it shall be subject to cancellation by the municipal corporation at any time upon thirty days' notice. 7. The provisions of this section shall permit a public corporation to provide coverage for volunteer firefighters, as defined in section three of the volunteer firefighters' benefit law, and volunteer ambulance workers, as defined in subdivision one of section three of the volunteer ambulance workers' benefit law, provided however, that the total cost of participation by such volunteers and their families shall be borne by such volunteers.