Exhibit 10.1

MEDICAL SERVICES AGREEMENT

FLORIDA HEALTHY KIDS CORPORATION and

HEALTHEASE

For

Citrus, Duval, Escambia, Highlands, Jefferson, Lake, Madison, Martin, Putnam and
Wakulla Counties

and

WELLCARE HMO/STAYWELL HEALTH PLAN

For

Brevard, Broward, Charlotte, Collier, Miami-Dade, Desoto, Hernando,
Hillsborough, Lee, Manatee,
Orange, Osceola, Palm Beach, Pinellas, Sarasota and Seminole Counties

October 1, 2005 — Effective Date

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 1 of 44

FLORIDA HEALTHY KIDS CORPORATION
AGREEMENT FOR MEDICAL SERVICES

TABLE OF CONTENTS

                      SECTION   1   GENERAL PROVISIONS        
 
    1-1     Definitions  
 

 
                    SECTION     2     FLORIDA HEALTHY KIDS CORPORATION
RESPONSIBILITIES
   
 
                   
SECTION
  2-1
2-2
2-3
3
3-1
3-2
3-2-1   Participant Identification
Payments
Reduced Fee Arrangements
2-3-1Specialty Fee Arrangements
2-3-2Children’s Medical Services
2-4Quarterly Program Updates
2-5 Change in Benefit Schedule
2-6Marketing
2-7Forms and Reports
2-8Coordination of Benefits
2-9Entitlement to Reimbursement
INSURER
Benefits
Access to Care
Access and Appointment Standards  

 

 
                          3-2-2     Integrity of Professional Advice to
Enrollees
   
 
                   
 
  3-3
3-4
3-5
3-6
3-7
3-8   Fraud and Abuse
Membership Materials
Use of Name
Eligibility
Effective Date of Coverage
Termination of Participation  

 

 
                          3-9     Continuation of Coverage Upon Termination of
this Agreement
   
 
                   
 
  3-10
3-11
3-12
3-13
3-14
3-15
3-16
3-17   Indi vidual Contracts
Refusal of Coverage
Extended Coverage
Grievances and Complaints
Claims Payment
Notification Requirements
Rates
Rate Modification
3-17-1 Annual Adjustment
3-17-2 Denial of Rate Request
3-18 Conditions of Services
3-19Medical Records Requirements
3-19-1Medical Quality Review and Audit
3-19-2 Privacy of Medical Records  

 

 
                                3-19-3 Requests by Participants for Medical
Records
   
 
                    HEALTHEASE AND STAYWELL HMO
          Effective Date: October 1, 2005
 
                   
SECTION
  3-20
3-21
3-22
3-23
3-24
3-25
3-26
3-27
3-28
3-29
3-30
4
4-1
4-2
4-3
4-4   Quality Enhancement
3-20-1 Authority
3-20-2 Staff
3-20-3 Peer Review
3-20-4 Referrals
Availability of Records
Audits
3-22-1 Accessibility of Records
3-22-2 Financial Audit
3-22-3 Post-Agreement Audit
3-22-4 Accessibility for Monitoring
Indemnification
Confidentiality of Information
Insurance
Lobbying Disclosure
Reporting Requirements
Participant Liability
Protection of Proprietary Information
Regulatory Filings
TERMS AND CONDITIONS
Effective Date
Multi-year Agreement
Entire Understanding
Relation to Other Laws   Page 2 of 44

 

 
                                4-4-1 Health Insurance Portability and
Accountability Act
   
 
                   
 
          4-4-2 Mental Health Parity Act  
 

 
                                4-4-3 Newboms and Mothers Health Protection Act
of 1996
   
 
                   
 
  4-5
4-6
4-7
4-8
4-9
4-10
4-11
4-12
4-13
4-14   Independent Contractor
Assignment
Notice
Amendments
Governing Law
Agreement Variation
Attorney’s Fees
Representatives
Termination
Contingency  

 

 
                    HEALTHEASE AND STAYWELL HMO
          Effective Date: October 1, 2005
 
                   
SECTION
    5     EXHIBITS   Page 3 of 44

 

Exhibit A: Premium Payment and Rates
Exhibit B: Enrollment Dates
Exhibit C: Benefits
Exhibit D: Coordination of Benefits
Exhibit E: Access Standards
Exhibit F: Eligibility
Exhibit G: Reporting Requirements
Exhibit H: Certification Regarding Debarment, Suspension and Involuntary
Cancellation
Exhibit I: Certification Regarding Lobbying Certification For Contracts, Grants,
Loans and Cooperative Agreements
Exhibit J: Certification Regarding Health Insurance Portability and
Accountability Access Act of 1996 Compliance

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

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AGREEMENT TO PROVIDE
COMPREHENSIVE HEALTH CARE SERVICES

This Agreement is made by and between the Florida Healthy Kids Corporation,
hereinafter referred to as “FHKC” and HEALTHEASE OF FLORIDA, INC. AND WELL CARE
HMO, INC. hereinafter collectively referred to as “INSURER.”

WHEREAS, FHKC has been specifically empowered in section 624.91 (5)(b)(10),
Florida Statutes, to enter into contracts with Health Maintenance Organization
(HMO’s), insurers, or any provider of health care services hereinafter referred
to as “Insurer,” meeting standards established by FHKC, for the provision of
comprehensive health insurance coverage to Participants; and

WHEREAS, Sections 641.2017 (1) and (2), Florida Statutes, allows INSURER to
enter such a contractual arrangement on a prepaid per capita basis whereby
INSURER assumes the risk that costs exceed the amount paid on a prepaid per
capita basis; and

WHEREAS, FHKC desires to increase access to health care services and improve
children’s health;

and

WHEREAS, FHKC did issue a Request for Proposals (“RFP”) in FHKC Health Insurance
Program inviting INSURER as well as other entities, to submit a proposal for the
provision of those Comprehensive Health Care Services set forth in the Request
for Proposals; and

WHEREAS, insurer’s proposal in response to the Request for Proposals was
selected through a competitive bid process as one of the most responsive and
cost effective bids; and

WHEREAS, INSURER has assured FHKC of full compliance with the standards
established in this Agreement and agrees to promptly respond to any required
revisions or changes in FHKC operating procedures or benefits which may be
required by law or implementing regulations; and

WHEREAS, INSURER agrees that the Request for Proposals released by FHKC and
insurer’s response to that RFP are incorporated by reference and in any conflict
between the RFP or the insurer’s response to the RFP and this Agreement, the
Agreement shall control; and

WHEREAS, FHKC is desirous of using insurer’s provider network to deliver
Comprehensive Health Care Services to all eligible FHKC Participants in counties
covered under Exhibit A of this Agreement;

NOW, THEREFORE, in consideration of the premises and the mutual covenants and
promises contained herein, the parties agree as follows:

SECTION 1 GENERAL PROVISIONS

1-1 Definitions

As used in this Agreement, the term:

  A.   “Comprehensive Health Care Services” means those services, medical
equipment, and supplies to be provided by INSURER in accordance with standards
set by FHKC and further described in Exhibit C.

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  B.   “Program” shall mean the project established by FHKC pursuant to
Section 624.91, Florida Statutes.

  C.   “Participant” or “Enrollee” means those individuals meeting FHKC
standards of eligibility and who have been enrolled in the Program.

D. “Insurer Providers” shall mean those providers set forth in the Insurer’s

Response to the Request for Proposals and the Participant’s handbook as from
time to time amended.

  E.   “Co-Payment” or “Cost Sharing” is the payment required of the Participant
at the time of obtaining service. In the event the Participant fails to pay the
required Co-Payment, INSURER may decline to provide non-emergency or
non-urgently needed care unless the Participant meets the conditions for waiver
of Co-Payments described in Exhibit C.

F. “Fraud” shall mean:

1) Any FHKC Participant or person who knowingly:

  a)   Fails, by any false statement, misrepresentation,

impersonation, or other fraudulent means, to disclose a material fact used in
making a determination as to such person’s qualification to receive
Comprehensive Health Care Services coverage under the FHKC Program;

  b)   Fails to disclose a change in circumstances in order to obtain or
continue to receive Comprehensive Health Care Services coverage under the FHKC
Program to which he or she is not entitled or in an amount larger than that
which he or she is entitled;

  c)   Aids and abets another person in the commission of any such act.

2) Any person or FHKC Participant who:

      a) Uses, transfers, acquires, traffics, alters, forges, or possesses, or

      b) Attempts to use, transfer, acquire, traffic, alter, forge or possess,
or

      c) Aids and abets another person in the use, transfer, acquisition,
traffic, alteration, forgery or possession of an FHKC identification card.

  G.   “State Children’s Health Insurance Program (SCHEP)” or “Title XXI” shall
mean the program created by the federal Balanced Budget Act of 1997 as Title XXI
of the Social Security Act.

H. “Children’s Medical Services Network” or “CMS” shall mean the statewide

managed care system which includes health care providers, as defined in Section

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391.021(1), Florida Statutes, which is funded by Title XXI. “Children’s Medical
Services Network” or “CMS” as used under this Agreement does not include any
additional programs and services provided by or through the Children’s Medical
Services Program described in Sections 391.021(8) and 391.025, Florida Statutes,
which are not provided through the Children’s Medical Services network or which
are not funded by Title XXI (such as the CMS Safety Net Program).

  I.   “Florida Statutes” shall mean the 2004 Florida Statutes, as amended from
time to time by the Florida Legislature, during the term of this Agreement.

SECTION 2 FLORIDA HEALTHY KIDS CORPORATION RESPONSIBILITIES

2-1 Participant Identification

FHKC shall promptly furnish to INSURER information to sufficiently identify
Participants in the Comprehensive Health Care Services plan authorized by this
Agreement.

Additionally, FHKC shall provide INSURER a compatible computer tape, or other
computer-ready media as agreed upon by the Parties, with the names of
Participants along with monthly additions or deletions throughout the term of
this Agreement in accordance with the following:

  A.   Not less than seven (7) working days prior to the effective date of
coverage, FHKC shall provide INSURER a listing of Participants eligible for
coverage. Such listing will also identify those Participants whose coverage
shall terminate on the last day of the current coverage month.

B. By the third (3rd) day after the effective date of coverage, FHKC shall also
furnish

INSURER a supplemental list of eligible Participants for that coverage month.
INSURER shall adjust enrollment retroactively to the 1st day of that month.

D. FHKC may request INSURER to accept additional Participants after the
supplemental

listing for enrollment retroactive to the 1st of that coverage month. Such
additions will be limited to those Participants who made timely payments but
were not included on the previous enrollment reports. If such additions exceed
more than one percent (1%) on that month’s enrollment, INSURER reserves the
right to deny FHKC’s request.

2-2 Payments

FHKC will promptly forward the authorized premiums in accordance with Exhibit A
attached hereto and incorporated herein as part of this Agreement on or before
the 1st day of each month this Agreement is in force commencing with the 1st day
of October, 2005. Premiums are past due on the 15th day of each month.

In the case of non-payment of premiums by the 15th day of the month for that
month of coverage, INSURER shall have the right to terminate coverage under this
Agreement, provided FHKC is given written notice prior to such termination, see
Section 4-13. Termination of coverage shall be retroactive to the last day for
which premium payment has been made.

2-3 Reduced Fee Arrangements

2-3-1 Specialty Service Fee Arrangements

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Upon prior approval of INSURER, FHKC shall have the right to negotiate specialty
service fee arrangements with non-INSURER affiliated providers and make such
rates available to INSURER. In such cases, if there is a material impact on the
premium, the premium in Exhibit A will be adjusted by INSURER in a manner
consistent with sound actuarial practices.

2-3-2 Children’s Medical Services Network

If there is a material impact on the premium in Exhibit A due to the
implementation of the Children’s Medical Services Network as created in Chapter
391, Florida Statutes, INSURER agrees to reduce the premium in Exhibit A in an
amount consistent with sound actuarial practices.

2-4 Program Updates

FHKC shall provide INSURER with updates on Program highlights such as
Participant demographics, profiles, newsletters, legislative or regulatory
inquiries and Program directives.

2-5 Change in Benefit Schedule

INSURER understands that changes in federal and state law may require amendments
to the Participant benefit schedule as set forth in Exhibit C. Should such
changes be necessary, FHKC shall notify INSURER in writing of the required
change and INSURER shall have thirty (30) days to agree to the amended benefits
schedule. If INSURER elects not to implement a change in the benefit schedule,
FHKC may terminate this Agreement by providing INSURER with a written notice of
termination and include a termination date of not less than ninety (90) days
from date of the written notification.

If the change in the benefit schedule results in a reduction in a benefit level,
INSURER shall reduce its premium rate by an amount actuarially equivalent to the
benefit reduction. INSURER must provide an actuarial memorandum to FHKC
indicating the actuarial value of the benefit reduction.

2-6 Marketing

FHKC will market the Program primarily through the county school districts. FHKC
agrees that INSURER shall be allowed to participate in any scheduled marketing
efforts to include, but not be limited to, any scheduled open house type
activities. However, INSURER is prohibited from any direct marketing to
applicants or Enrollees. INSURER may not utilize FHKC’s logo, name, or corporate
identity, unless such activity or promotion has received prior written
authorization from FHKC. Written authorization must be received for every
individual activity.
FHKC will have the right of approval or disapproval of all descriptive plan
literature and forms. 2-7 Forms and Reports

FHKC agrees that INSURER shall participate in the development of any FHKC
eligibility report formats that may be required from time to time.

2-8 Coordination of Benefits

FHKC agrees that INSURER may coordinate health benefits with other Insurers as
provided for in Section 624.9 l(5)(c), Florida Statutes, and Exhibit D of this
Agreement. INSURER also agrees to coordinate benefits with any Insurer under
contract with FHKC to provide comprehensive dental benefits to FHKC
Participants, including

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providing prescription coverage prescribed by the Enrollee’s dental provider.

If INSURER identifies a Participant covered through another health benefits
program, INSURER shall notify FHKC. FHKC shall decide whether the Participant
may continue coverage through FHKC in accordance with the eligibility standards
adopted by FHKC and in accordance with any applicable state laws.

2-9 Entitlement to Reimbursement

In the event INSURER provides medical services or benefits to Participants who
suffer injury, disease or illness by virtue of the negligent act or omission of
a third party, INSURER shall be entitled to reimbursement from the Participant,
at the prevailing rate, for the reasonable value of the services or benefits
provided. INSURER shall not be entitled to reimbursement in excess of the
Participant’s monetary recovery for medical expenses provided from the third
party. INSURER is solely responsible for the coordination of benefits with any
other third party payor in accordance with Section 624.91(5)(c), Florida
Statutes.

SECTION 3 INSURER RESPONSIBILITIES

3-1 Benefits

INSURER agrees to make its provider network available to FHKC Participants in
the counties listed in Exhibit A and to provide the Comprehensive Health Care
Services as set forth in Exhibit C attached hereto and by reference made a part
hereof.

3-2 Access to Care

3-2-1 Access and Appointment Standards

INSURER agrees to meet or exceed the appointment and geographic access standards
for pediatric care existing in the community and as specifically provided for in
Exhibit E attached hereto and incorporated herein as a part of this Agreement.

In the event insurer’s provider network is unable to provide those medically
necessary benefits specified in Exhibit C under the standards established in
Exhibit E, for any reason except force majeure, INSURER shall be responsible for
those contract benefits obtained from providers other than INSURER for eligible
FHKC Participants.

In the event INSURER fails to meet those access and appointment standards set
forth in Exhibit E, FHKC shall notify INSURER of its noncompliance with the
standards in Exhibit E. If the noncompliance is not corrected within, the time
standards established in Exhibit E, FHKC may direct its Participants to obtain
such contract benefit from other willing and qualified providers and may
contract for such services. All financial responsibility related to services
received under these specific circumstances shall be assumed by INSURER.

3-2-2 Integrity of Professional Advice to Enrollees

INSURER ensures no interference with the advice of health care professionals to
Enrollees and that information about treatments will be provided to Enrollees
and their families in the appropriate manner.

INSURER agrees to comply with any federal regulations related to physician
incentive plans and any disclosure requirements related to such incentive plans.

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3-3 Fraud and Abuse

INSURER ensures that it has appropriate measures in place to ensure against
fraud and abuse. INSURER shall report to FHKC any information on violations by
subcontractors or Participants that pertains to enrollment or the payment and
provision of health care services under this Agreement.

INSURER agrees to allow FHKC access to monitor any fraud and abuse prevention
activities conducted by INSURER under this Agreement.

Applicants and Enrollees who are found no longer to be eligible, have submitted
incorrect or fraudulent information or failed to submit required information for
eligibility determination, may be disenrolled immediately from the Program by
FHKC. Individuals who knowingly provided false information in order to obtain
benefits under the Healthy Kids or Florida KidCare Program may be subject to
prosecution under Section 414.39, Florida Statutes. Should the INSURER become
aware of any such activity, the INSURER shall report its findings to FHKC for
investigation.

3-4 Membership Materials

INSURER agrees that it shall not utilize the marketing materials, logos, trade
names, service marks or other materials belonging to FHKC, without FHKC’s
consent that shall not be unreasonably withheld.

INSURER shall be responsible for all preparation, cost and distribution of
member handbooks, plan documents, materials, and orientation, for FHKC
Participants. Materials will be appropriate to the population served and unique
to the Program. All membership materials and documents which are distributed to
FHKC Participants must be reviewed and approved by FHKC prior to distribution.
INSURER agrees to provide FHKC with a copy of all such documents for review on
an annual basis. 3-5 Use of Name

INSURER consents to the use of its name in any marketing and advertising or
media presentations describing FHKC which are developed and disseminated by FHKC
to Participants, employees, employers, the general public or the County School
System, provided however, INSURER reserves the right to review and concur in any
such marketing materials prior to its dissemination.

3-6 Eligibility

INSURER agrees to accept those Participants which FHKC has determined meet the
Program’s eligibility requirements.

3-6-1 Requests for Eligibility Review

INSURER reserves the right to request that FHKC review the eligibility of a
particular Enrollee. FHKC shall ensure all records and findings maintained by
FHKC concerning a particular eligibility determination will be made available
with reasonable promptness to the extent permitted under Section 624.91, Florida
Statutes,_and Section 409.821, Florida Statutes, regarding confidentiality of
information held by FHKC and the Florida KidCare Program.

3-6-2 Eligibility Review Process

If the INSURER and FHKC dispute whether a Participant is eligible for the
Program because the INSURER believes that the Participant should be, or is,
enrolled in CMS, then upon receipt of a

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$100.00 fee, INSURER may request that FHKC seek an independent determination
ofCMS eligibility from the Florida Department of Health and, if appropriate, the
Florida Department of Children and Families. Both the INSURER and FHKC agree
that the decision of the Florida Department of Health and if applicable, the
Florida Department of Children and Families regarding the Participant’s
eligibility for CMS shall be final and binding.

If a Participant is determined not to be eligible for the FHKC Program, and the
INSURER included that Participant in supporting actuarial memoranda to support a
premium or rate modification request under section 3-17,1. of this Agreement,
then the INSURER shall submit to FHKC a revised supporting actuarial memorandum
which excludes that Participant. Thereafter, the INSURER’S premium or rate shall
be reviewed by the Board of Directors of FHKC and adjusted accordingly. The
INSURER and FHKC agree that the rights and remedies provided under this
Section 3-6 shall be exclusive as to eligibility disputes

3-7 Effective Date of Coverage

Coverage for every Participant shall become effective at 12:01 a.m. EST/EDT, on
the first day of the Participant’s first coverage month, as determined by FHKC.

3-8 Termination of Participation A Participant’s coverage under this Program
shall terminate on the last day of the month in which the Participant:

A. ceases to be eligible to participate in the Program;

B. establishes residence outside the service area; or

C. is determined to have acted fraudulently pursuant to Section l-l(F) or
Section 3-3. Termination of coverage and the effective date of that termination
shall be determined solely by FHKC.

3-9 Continuation of Coverage Upon Termination of this Agreement

INSURER agrees that, upon termination of this Agreement for any reason, unless
instructed otherwise by FHKC, it will continue to provide inpatient services to
FHKC Participants who are then inpatients until such time as such Participants
have been appropriately discharged. However, INSURER shall not be required to
provide such extended benefits beyond twelve (12) calendar months from the date
the Agreement is terminated.

If INSURER terminates this Agreement at its sole option and through no fault of
FHKC, and if on the date of termination a Participant is totally disabled and
such disability commenced while coverage was in effect, that Participant shall
continue to receive all benefits otherwise available under this Agreement for
the condition under treatment which caused such total disability until the
earlier of (1) the expiration of the contract benefit period for such benefits;
(2) determination by the Medical Director of INSURER that treatment is no longer
medically necessary; (3) twelve (12) months from the date of termination of
coverage; (4) a succeeding carrier elects to provide replacement coverage
without limitation as to the disability condition; provided however, that
benefits will be provided only so long as the Participant is continuously
totally disabled and only for the illness or injury which caused the total
disability.

For purposes of this section, a Participant who is “totally disabled” shall mean
a Participant who is physically unable to work, as determined by the Medical
Director of INSURER, due to an illness or injury at any gainful job for which
the Participant is suited by education, training, experience or ability.
Pregnancy, childbirth or hospitalization in and of itself do not constitute
“total disability.” In the case of maternity coverage, when a

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Participant is eligible for such coverage and when not covered by a succeeding
carrier, a reasonable period of extension of benefits shall be granted. The
extension of benefits shall be only for the period of pregnancy and shall not be
based on total disability.

3-10 Participant Certificates and Handbooks

INSURER will issue Participant certificates, identification cards, provider
network listings and handbooks to all FHKC designated Participants within five
(5) business days of receipt of an eligibility tape. Except as specifically
provided in Sections 3-8 and 3-12 hereof, all Participant rights and benefits
shall terminate upon termination of this Agreement or upon termination of
participation in the Program. All Participant handbooks and member materials
must be approved by FHKC prior to distribution.

3-11 Refusal of Coverage

INSURER shall not refuse to provide coverage to any Participant on the basis of
past or present health status.

3-12 Extended Coverage

With regards to those Participants who have been terminated pursuant to
Section 3-7 A, INSURER agrees to offer individual coverage to all Participants
without regard to health condition or status.

3-13 Grievances and Complaints

INSURER agrees to provide all FHKC Participants a Grievance Process. The
grievance and complaint procedures shall be governed by any applicable federal
and state laws and regulations issued for SCHIP, and the following additional
rules and guidelines also apply:

  A.   There must be sufficient support staff (clerical and professional)
available to process grievances.  

  B.   Staff must be educated concerning the importance of the procedure and the
rights of the Enrollee.

C. Someone with problem solving authority must be part of the grievance
procedure.
D. In order to initiate the grievance process, such grievance must be filed in
writing.

  E.   The parties will provide assistance to grievant during the grievance
process to the extent FHKC deems necessary.

  F.   Grievances shall be resolved within sixty (60) days from initial filing
by the Participant, unless information must be collected from providers located
outside the authorized service area or from non-contract providers. In such
exceptions, an additional extension shall be authorized upon establishing good
cause.

  G.   A record of informal complaints received that are not grievances shall be
maintained and shall include the date, name, nature of the complaint and the
disposition.

  H.   The grievance procedures must conform to the federal regulations
governing the State Children’s Health Insurance Program (SCHEP).  

I. A quarterly report of all grievances involving FHKC Participants must be
submitted to

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FHKC. The report shall list the number of grievances received during the quarter
and the disposition of those grievances. INSURER shall also inform FHKC of any
grievances that are referred to the Statewide Subscriber Assistance Panel or its
successor(s) prior to their presentation at the panel.

  J.   The INSURER shall provide FHKC with its current grievance process for
FHKC Participants upon execution of this Agreement and then annually thereafter.
Additionally, INSURER shall provide FHKC with advance notice of any subsequent
changes to the process. Such changes must be reviewed and approved by FHKC prior
to implementation.

3-14 Claims Payment

INSURER will pay any claims from its offices located at 8735 Henderson Road,
Tampa, Florida 33634 (or any other designated claims office located in its
service area). INSURER will pay clean claims filed within thirty (30) working
days or request additional information of the claimant necessary to process the
claim.

3-15 Notification Requirements

A. INSURER shall immediately notify FHKC in writing of:

  1.   Any judgment, decree, or order rendered by any court of any jurisdiction
or

Florida Administrative Agency enjoining INSURER from the sale or provision of
service under Chapter 641, Part II, Florida Statutes.

  2.   Any petition by INSURER in bankruptcy or for approval of a plan of

reorganization or arrangement under the Bankruptcy Act or Chapter 631, Part I,
Florida Statutes, or an admission seeking the relief provided therein.

  3.   Any petition or order of rehabilitation or liquidation as provided in
Chapters 631 or 641, Florida Statutes.

  4.   Any order revoking the INSURER’S Certificate of Authority.

  5.   Any administrative action taken by the Department of Financial Services
or

Office of Insurance Regulation_or the Agency for Health Care Administration in
regard to INSURER.

  6.   Any medical malpractice action filed in a court of law in which a FHKC

Participant is a party (or in whose behalf a Participant’s allegations are to be
litigated).

  7.   The filing of an application for change of ownership with the Florida
Department of Financial Services or Office of Insurance Regulation.

  8.   Any change in subcontractors who are providing services to FHKC
Participants in accordance with the provisions of Section 3-31 of this
Agreement.

  9.   Any pending litigation or commencement of legal action involving the

INSURER in which liability for or the insurer’s obligation to pay could exceed
10% of the insurer’s surplus.

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B. Monthly Notification Requirements

INSURER shall inform FHKC monthly of any changes to the provider network that
differ from the network presented in the original bid proposal, including
discontinuation of any primary care providers or physician practice associations
or groups with Healthy Kids Enrollees on its panels. FHKC may require INSURER to
provide PHKC with evidence that its provider network continues to meet the
appointment and access standards described in Exhibit E.

3-16 Rates

The rate charged for provision of Comprehensive Health Care Services shall be as
stated in Exhibit A.

3-17 Rate Modification

I. Annual Adjustment

Upon request by INSURER, the Board of Directors of FHKC may approve an
adjustment to the premium effective only on October 1st of each contract year;
however each adjustment request must meet the following minimum conditions:

A. Any request to adjust the premium must be received by the preceding April 1;

  B.   The request for an adjustment must be accompanied by a supporting
actuarial memorandum; and

C. The proposed premium shall not be excessive or inadequate in accordance

with the standards established by the Department of Financial Services or the
Office of Insurance Regulation for such determination.

II. Rate Adjustment Denials

In the event that the insurer’s rate adjustment is denied by the Board of
Directors of FHKC, the INSURER may request that an independent actuary be
retained to determine whether or not the proposed rate is excessive or
inadequate.

A. Any request for a review of a denied rate must be submitted by the

INSURER to FHKC in writing within fourteen (14) calendar days of the date of the
board meeting in which the Board of Directors denied the rate request.

B. The INSURER must provide FHKC with a list of three (3) qualified

independent actuaries and also provide the curriculum vitae for each
proposed actuary. FHKC shall select an actuary from the list provided by the
INSURER no later than fourteen (14) calendar days following receipt of the

information from INSURER.

C. The actuary’s findings must be in writing and communicated to both FHKC

and the INSURER within thirty (30) days after execution of the Letter of the

Engagement by all parties.

D. The effective date of the actuary’s determination shall be October 1st or the

first of the month following the receipt of the actuary’s findings, whichever

occurs later.

E. The cost for such review will be split between FHKC and INSURER.
F. The decision of the independent actuary will be binding on FHKC and

                  HEALTHEASE AND STAYWELL HMO
          Effective Date: October 1, 2005
 
               
3-18
  Conditions of Services   INSURER.

  Page 14 of 44

 

Services shall be provided by INSURER under the following conditions:

  A.   Appointment. Participants shall first contact their assigned primary care
physician for an appointment in order to receive non-emergency health services.

  B.   Provision of Services. Services shall be provided and paid for by INSURER
only when INSURER performs, prescribes, arranges or authorizes the services.
Services are available only from and under the direction of INSURER and neither
INSURER nor INSURER physicians shall have any liability or obligation whatsoever
on account of any service or benefit sought or received by any member from any
other physician or other person, institution or organization, unless prior
special arrangements are made by INSURER and confirmed in writing except as
provided for in Section 3-2.

C. Hospitalization. INSURER does not guarantee the admission of a Participant to
any

specific hospital or other facility or the availability of any accommodations or
services therein. Inpatient Hospital Service is subject to all rules and
regulations of the hospital or other medical facility to which the Participant
is admitted.

D. Emergency Services. Exceptions to Section 3-18 A, B and C are services which
are

needed immediately for treatment of an injury or sudden illness wherein delay
means risk of permanent damage to the Participant’s health. INSURER shall
provide and pay for emergency services both inside and outside the service area.

3-19 Medical Records Requirements

INSURER shall require providers to maintain medical records for each Participant
under this Agreement in accordance with applicable state and federal law.

3-19-1 Medical Quality Review and Audit

FHKC shall conduct an independent medical quality review of INSURER during this
Agreement term. The independent auditor’s report will include a written review
and evaluation of care provided to FHKC Participants in the county. Additional
reviews also may be conducted after completion of the baseline review at the
discretion of FHKC. INSURER agrees to cooperate in all evaluation efforts
conducted or authorized by FHKC.

3-19-2 Privacy of Medical Records

INSURER will ensure that all individual medical records will be maintained with
confidentiality in accordance with state and federal guidelines. INSURER agrees
to abide by all applicable state and federal laws governing the confidentiality
of minors and the privacy of individually identifiable health information.
insurer’s policies and procedures for handling medical records and protected
health information (PHI) shall be compliant with the Health Insurance
Portability and Accountability Act of 1996 (HIPAA) and shall include provisions
for when an Enrollee’ s PHI may be disclosed without consent or authorization.

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

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3-19-3 Requests by Participants for Medical Records

INSURER will ensure that each Participant may request and receive a copy of
records and information pertaining to that Enrollee in a timely manner.
Additionally, the Participant may request that such records be corrected or
supplemented.

3-20 Quality Enhancement (Assurance)

The INSURER shall have a quality enhancement program. If the INSURER has an
existing program, it must satisfy FHKC’s quality enhancement standards. Approval
will be based on the insurer’s adherence to the minimum standards listed below.

      3-20-1 Quality Enhancement Authority. The plan shall have a quality
enhancement review authority that shall:  

(a) Direct and review all quality enhancement activities.

(b) Assure that quality enhancement activities take place in all areas of the
plan.

(c) Review and suggest new or improved quality enhancement activities.

(d) Direct task forces/committees in the review of focused concern.

(e) Designate evaluation and study design procedures.

(f) Publicize findings to appropriate staff and departments within the plan.

(g) Report findings and recommendations to the appropriate executive authority.

(h) Direct and analyze periodic reviews of Enrollees’ service utilization
patterns.

      3-20-2 Quality Enhancement Staff. The plan shall provide for quality
enhancement staff which has the responsibility of:

  (a)   Working with personnel in each clinical and administrative department to
identify problems related to quality of care for all covered professional
services.

  (b)   Prioritizing problem areas for resolution and designing strategies for
change.

  (c)   Implementing improvement activities and measuring success.

  (d)   Providing outcome of any Quality Enhancement activities involving
children 5-19 years of age to FHKC.

      3-20-3 Peer Review Authority. The plan’s quality enhancement program shall
have a peer review component and a Peer Review Authority.  

Scope of Activities

  (a)   The review of the practice methods and patterns of individual physicians
and other health care professionals.

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 16 of 44

  (b)   The ability and responsibility to evaluate the appropriateness of care
rendered by professionals.

(c) The authority to implement corrective action when deemed necessary.

  (d)   The responsibility to develop policy recommendations to maintain or
enhance the quality of care provided to plan Participants.

(e) A review process which includes the appropriateness of diagnosis and

subsequent treatment, maintenance of medical record requirements, adherence to
standards generally accepted by professional group peers, and the process and
outcome of care.

  (f)   The maintenance of written minutes of the meetings and provision of
reports to FHKC of any activities related to FHKC Participants.

(g) Peer review must include examination of morbidity and mortality.

      3-20-4 Referrals To Peer Review Authority  

  (a)   All written and/or oral allegations of inappropriate or aberrant service
must be referred to the Peer Review Authority.

  (b)   Recipients and staff must be advised of the role of the Peer Review
Authority and the process to advise the Authority of situations or problems.

  (c)   All grievances related to medical treatment must be presented to the
Authority for examination and when a FHKC Participant is involved, the outcome
of the grievance resolution reported to FHKC.

3-21 Availability of Records

INSURER shall make all records available at its own expense for review, audit,
or evaluation by authorized federal, state and FHKC personnel. The location will
be determined by INSURER subject to approval of FHKC. Access will be during
normal business hours and will be either through on-site review of records or
through the mail.

Copies of all records will be sent to FHKC by certified mail within seven
(7) working days of request. It is FHKC’s responsibility to obtain sufficient
authority, as provided for by applicable statute or requirement, to provide for
the release of any patient specific information or records requested by FHKC,
state or federal agencies.

3-22 Audits

3-22-1 Accessibility of Records

INSURER shall maintain books, records, documents, and other evidence pertaining
to the administrative costs and expenses of this Agreement. These records,
books, documents, and any related financial transactions shall be available for
review by authorized federal, state and FHKC personnel during the Agreement
period and for up to five (5) years thereafter, except if an audit is in
progress or audit findings are yet unresolved in which

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 17 of 44

case records shall be kept until all tasks are completed. Such terms and
conditions shall also be required of any subcontractors who perform any duties
under this Agreement. INSURER will ensure that such terms are included in any
subcontracts or other agreements with affiliated entities that may perform
duties or provide services under this Agreement on the insurer’s behalf.

During the Agreement period, these records shall be available at insurer’s
offices at all reasonable times. After the Agreement period and for five
(5) years following, the records shall be available upon reasonable notice at
the insurer’s chosen location subject to the approval of FHKC. If the records
need to be sent to FHKC, INSURER shall bear the expense of delivery. Prior
approval of the disposition of INSURER and subcontractor records must be
requested and approved if the contract or subcontract is continuous.

This Agreement is subject to unilateral cancellation by FHKC if INSURER refuses
to allow such public access or fails to ensure such access to the records of its
subcontractors or affiliates who may perform duties or services under this
Agreement.

3-22-2 Financial Audit

Upon reasonable notice by FHKC, INSURER shall permit an independent audit by
FHKC of its financial condition or performance standard in accordance with the
provisions of this Agreement and the Florida Insurance Code and regulations
adopted thereunder.

Additionally, INSURER agrees annually to provide an audited financial statement
to FHKC by July 1 of each year for the insurer’s preceding fiscal year.

3-22-3 Post-Agreement Audit

INSURER shall cooperate with any post-Agreement audits conducted by FHKC, an
independent entity under contract with FHKC or any other appropriate state or
federal regulatory authority. Such audits shall include a review of the
insurer’s administrative costs and expenses with regard to the Program and
Program funds. This provision shall also be included in any agreement between
INSURER and its subcontractors or affiliates in order to ensure access to any
related financial transactions with regard to the Program or Program funds.

In addition, INSURER agrees to the following:

INSURER agrees to retain and make available upon request to FHKC, any entity
contracted with FHKC or a state or federal regulatory agency, all books,
documents and records necessary to verify the nature and extent of the costs of
the services provided under this Agreement, and that such records will be
retained and held available by INSURER for such inspection until the expiration
of five (5) years after the services are furnished under this Agreement.

If, pursuant to this Agreement and if insurer’s duties and obligations are to be
carried out by an individual or entity subcontracting with INSURER and that
subcontractor, to a significant extent, owns or is owned by or has control of or
is controlled by INSURER, each subcontractor shall itself be subject to the
access requirement and INSURER hereby agrees to require such subcontractors to
meet the access requirement both during and

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 18 of 44

after the Agreement term.

INSURER understands that any request for access must be in writing and contain
reasonable identification of the documents, along with a statement as to the
reason that the appropriateness of the costs or value of the services in
question cannot be adequately or efficiently determined without access to its
books or records. INSURER agrees that it will notify FHKC in writing within ten
(10) days upon receipt of a request for access.

3-22-4 Accessibility for Monitoring

INSURER shall make available to all authorized federal, state and FHKC
personnel, records, books, documents, and other evidence pertaining to this
Agreement as well as appropriate personnel for the purpose of monitoring under
this Agreement. The monitoring shall occur periodically during this Agreement
period.

INSURER also agrees to cooperate in any evaluative efforts conducted by FHKC or
an authorized subcontractor of FHKC both during and after the term of this
Agreement for a period up to five (5) years.

3-23 Indemnification

INSURER agrees to indemnify and hold harmless FHKC from any losses resulting
from negligent, dishonest, fraudulent or criminal acts of INSURER, its officers,
its directors, or its employees, whether acting alone or in collusion with
others.

INSURER shall indemnify, defend, and hold FHKC and its officers, employees and
agents harmless from all claims, suits, judgments or damages, including court
costs and attorney fees, arising out of any negligent or intentional torts by
INSURER.

INSURER shall hold all enrolled Participants harmless from all claims for
payment of covered services, except Co-Payments, including court costs and
attorney fees arising out of or in the course of this Agreement pertaining to
covered services. In no case will FHKC or Program Participants be liable for any
debts of the INSURER.

INSURER agrees to indemnify, defend, and save harmless FHKC, its officers,
agents, and employees from:

  A.   Any claims or losses attributable to a service rendered by any
subcontractor, person, or firm performing or supplying services, materials, or
supplies in connection with the performance of this Agreement regardless of
whether FHKC knew or should have known of such improper service, performance,
materials or supplies.

  B.   Any failure of INSURER, its officers, employees, or subcontractors to
observe Florida law, including but not limited to labor laws and minimum wage
laws, regardless of whether FHKC knew or should have known of such failure.

With respect to the rights of indemnification given herein, INSURER agrees to
provide to FHKC, if known to INSURER, timely written notice of any loss or claim
and the opportunity to mitigate, defend and settle such loss or claim as a
condition of indemnification. With respect to the rights of indemnification
given herein, FHKC agrees to provide to INSURER, if known to FHKC, timely
written notice of any loss or claim and the opportunity to mitigate, defend and
settle such loss or claim as a condition to indemnification

     
3-24Confidentiality of Information
 

 
   
HEALTHEASE AND STAYWELL HMO
  Effective Date: October 1, 2005

Page 19 of 44

INSURER shall treat all information, and in particular information relating to
Participants that is obtained by or through its performance under this
Agreement, as confidential information to the extent confidential treatment is
provided under state and federal laws. INSURER shall not use any information so
obtained in any manner except as necessary for the proper discharge of its
obligations and to secure its rights under this Agreement.

All information as to personal facts and circumstances concerning Participants
obtained by INSURER shall be treated as privileged communications, shall be held
confidential, and shall not be divulged without the written consent ofFHKC, the
Participant’s parent or guardian or the Participant, provided that nothing
stated herein shall prohibit the disclosure of information in summary,
statistical, or other form which does not identify particular individuals. The
use or disclosure of information concerning Participants will be limited to
purposes directly connected with the administration of this Agreement. It is
expressly understood that substantial evidence of insurer’s refusal to comply
with this provision shall constitute a breach of this Agreement.

3-25 Insurance

INSURER shall not commit any work in connection with this Agreement until it has
obtained all types and levels of insurance required and approved by appropriate
state regulatory agencies. The insurance includes but is not limited to workers’
compensation, liability, fire insurance, and property insurance. Upon request,
FHKC shall be provided proof of coverage of insurance by a certificate of
insurance accompanying the contract documents.

FHKC shall be exempt from and in no way liable for any sums of money that may
represent a deductible in any insurance policy. The payment of such a deductible
shall be the sole responsibility of INSURER and/or subcontractor holding such
insurance. The same holds true of any premiums paid on any insurance policy
pursuant to this Agreement. Failure to provide proof of coverage may result in
this Agreement being terminated.

3-26 Lobbying Disclosure

INSURER shall comply with applicable state and federal requirements for the
disclosure of information regarding lobbying activities of the firm,
subcontractors or any authorized agent. Certification forms shall be filed by
INSURER certifying that no state or federal funds have been or will be used in
lobbying activities, and the disclosure forms shall be used by INSURER to
disclose lobbying activities in connection with the program that have been or
will be paid with non-federal funds.

3-27 Reporting Requirements

INSURER agrees to provide on a timely basis the quarterly statistical reports
detailed in Exhibit G to FHKC that FHKC must have to satisfy reporting
requirements. INSURER also agrees to attest to the accuracy, completeness and
truthfulness of claims and payment data that are submitted to FHKC under penalty
of perjury. Access to Participant claims data by FHKC, the State of Florida, the
federal Centers for Medicare and Medicaid Services, and the Department of Health
and Human Services Inspector General will be allowed to the extent allowed under
any state privacy protections.

Failure to provide the reports required under Exhibit G may be cause for
termination under Section 4-13(A) of this Agreement.

3-28 Participant Liability

INSURER hereby agrees that no FHKC Participant shall be liable to INSURER or any
INSURER network providers for any services covered by FHKC under this Agreement.
Neither INSURER nor any representative of INSURER shall collect or attempt to
collect from an FHKC Participant any money for services covered by the Program
and neither INSURER nor representatives of INSURER may maintain any action at
law against a FHKC Participant to collect money owed to INSURER by FHKC. FHKC
Participants shall not be liable to INSURER

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 20 of 44

for any services covered by the Participant’s contract with FHKC. This provision
shall not prohibit collection of Co-Payments made in accordance with the terms
of this Agreement, nor shall this provision prohibit collection for services not
covered by the contract between FHKC and the Participants.

3-29 Protection of Proprietary Information

INSURER and FHKC mutually agree to maintain the integrity of all proprietary
information, including but not limited to membership lists, including names,
addresses and telephone numbers to the extent provided under state law. However,
INSURER understands that FHKC may be subject to the Florida Public Records Act,
(Section 119.07, Florida Statutes) and all such information may be considered a
public record and open to inspection. To the extent permitted under state law,
neither party will disclose or allow to disclose proprietary information, by any
means, to any person without the prior written approval of the other party. All
proprietary information will be so designated.

This requirement does not extend to routine reports and membership disclosure
necessary for efficient management of the Program.

3-30 Regulatory Filings

INSURER will forward all regulatory filings, (i.e., documents, forms and rates)
relating to this Agreement to FHKC for its review and approval. Once such
regulatory filings are approved, FHKC will submit them to the Department of
Financial Services on insurer’s behalf.

3-31 Use of Subcontractors or Affiliates

The INSURER may contract with subcontractors or affiliates to deliver services
to Participants under this Agreement subject to the following conditions:

A. INSURER identified the subcontractor or affiliate in its response to the
FHKC’s Request for Proposals for the counties covered by this Agreement;

B. INSURER has provided FHKC with a copy of the current contract or other
written agreement for services between the INSURER and the subcontractor or
affiliate and FHKC has approved the participation of the subcontractor or
affiliate and the agreement;

C. insurer’s Agreement with the subcontractor or affiliate fully complies with
all terms and conditions of the Agreement between the INSURER and FHKC;

D. INSURER agrees to notify FHKC in advance of the termination of any
subcontractor or affiliate under this Agreement;

E. INSURER shall provide FHKC with advance notice of the insurer’s intention to
contract with any new subcontractors and affiliates for services covered under
this Agreement and shall forward for FHKC review and approval any agreement for
services with the proposed subcontractors or affiliates;

F. INSURER shall provide FHKC with copies of any amendments or revisions to
previously approved agreements and FHKC shall have the right to withhold its
approval of any such amendments; and,

G. INSURER agrees to provide FHKC with an annual report of all subcontractors or
affiliates that performed services under this Agreement by April 1st of each
year for the most recently concluded calendar year which shall include a copy of
all written, executed contracts with all subcontractors and affiliates.

All agreements between INSURER and its subcontractors or affiliates to provide
services to Participants under this Agreement shall be reduced to writing and
shall be executed by both parties. All such agreements shall also be available
to FHKC within seven (7) days of a request for production.

Failure of INSURER to comply with the provisions of this Section may be
considered as grounds for the termination of this Agreement under Section 4-13
at the discretion of FHKC.

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 21 of 44

SECTION 4 TERMS AND CONDITIONS

4-1 Effective Date

This Agreement shall be effective on the first (1st) day of October 2005 and
shall remain in effect through September 30, 2006.

4-2 Multiple Year Agreement

Parties hereto agree this is a “Multiple Year Agreement,” meaning this Agreement
which is effective as of October 1, 2005 shall extend through September 30, 2006
and shall thereafter be renewed automatically for no more than two
(2) successive one (1) year periods. Either party may elect not to renew this
Agreement and in that event shall give written notice to said effect to the
other party at least one hundred-twenty (120) days prior to the expiration of
the then current term.

4-3 Entire Understanding

This Agreement embodies the entire understanding of the parties in relationship
to the subject matter hereof. No other agreement, understanding or
representation, verbal or otherwise, relative to the subject matter hereof
exists between the parties at the time of execution of this Agreement.
This Agreement supersedes all prior Agreements between the parties. 4-4 Relation
to Other Laws

4-4-1 Health Insurance Portability and Accountability Act (HIPAA)

Coverage offered under this Agreement is considered creditable coverage for the
purposes of part 7 of subtitle B of title II of ERISA, title XXVII of the Public
Health Services Act and subtitle K of the Internal Revenue Code of 1986. INSURER
is responsible for issuing a certificate of creditable coverage to those FHKC
Participants who disenroll from the Program.

Additionally, INSURER agrees to comply with all other applicable provisions of
the HIPAA, and will certify compliance under Exhibit J.

4-4-2 Mental Health Parity Act (MHPA)

INSURER agrees to comply with the requirements of the Mental Health Parity Act
of 1996 regarding parity in the application of annual and lifetime dollar limits
to mental health benefits in accordance with 45 CFR 146.136.

4-4-3 Newboms and Mothers Health Protection Act of 1996 (NMHPA)

INSURER agrees to comply with the requirements of the NMHPA of 1996 regarding
requirements for minimum hospital stays for mothers and newboms in accordance
with 45 CFR 146.130 and 148.170.

      4-5 Independent Contractor

The relationship of INSURER to FHKC shall be solely that of an independent
contractor. As an independent

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 22 of 44

contractor, INSURER agrees to comply with the following provisions:

  a.   Title VI of the Civil Rights Act of 1964, as amended, 42 U.S.C. 2000d et
seq., which prohibits discrimination on the basis of race, color, or national
origin.

  b.   Section 504 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. 794,
which prohibits discrimination on the basis of handicap.  

  c.   Title IX of the Education Amendments of 1972, as amended 29 U.S.C. 601 et
seq., which prohibits discrimination on the basis of sex.

  d.   The Age Discrimination Act of 1975, as amended, 42 U.S.C. 6101 et seq.,
which prohibits discrimination on the basis of age.  

  e.   Section 654 of the Omnibus Budget Reconciliation Act of 1981, as amended,
42 U.S.C. 9848, which prohibits discrimination on the basis of race, creed,
color, national origin, sex, handicap, political affiliation or beliefs.

  f.   The Americans with Disabilities Act of 1990, P.L. 101-336, which
prohibits discrimination on the basis of disability and requires reasonable
accommodation for persons with disabilities.

g. Section 274A (e) of the Immigration and Nationalization Act, FHKC shall

consider the employment by any contractor of unauthorized aliens a violation of
this Act. Such violation shall be cause for unilateral cancellation of this
Agreement.

h. 0MB Circular A-l 10 (Appendix A-4) which identifies procurement

procedures which conform to applicable federal law and regulations with regard
to debarment, suspension, inehgibility, and involuntary exclusion of contracts
and subcontracts and as contained in Exhibit I of this Agreement. Covered
transactions include procurement contracts for services equal to or in excess of
$100,000 and all non-procurement transactions.

  i.   The federal regulations implementing the State Children’s Health
Insurance Program (SCHIP) as found in 42 CFR Parts 431, 433, 435,436 and 457 and
any subsequent revisions to the regulation.

4-6 Assignment

This Agreement may not be assigned by INSURER without the express prior written
consent of FHKC. Any purported assignment shall be deemed null and void.

This Agreement and the monies that may become due hereunder are not assignable
by INSURER except with the prior written approval of FHKC.
4-7 Notice Notice required or permitted under this Agreement shall be directed
as follows:

For INSURER:
TODD FARHA

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 23 of 44

PRESIDENT AND CHIEF EXECUTIVE OFFICER

HEALTHEASE OF FLORIDA, INC.
WELL CARE HMO, INC.
8735 HENDERSON ROAD
RENAISSANCE BLDG 2
TAMPA, FLORIDA 33634

For PHKC:
EXECUTIVE DIRECTOR FLORIDA HEALTHY KIDS CORPORATION POST OFFICE BOX 980
TALLAHASSEE, FL 32302

or to such other place or person as written notice thereof may be given to the
other party. 4-8 Amendment

Not withstanding anything to the contrary contained herein, this Agreement may
be amended by mutual written consent of the parties at any time.

4-9 Governing Law

This Agreement shall be construed and governed in accordance with the laws of
the State of Florida. In the event any action is brought to enforce the
provisions of this Agreement, venue shall be in Leon County, Florida.

4-10 Agreement Variation

If any provision of this Agreement (including items incorporated by reference)
is declared or found to be illegal, unenforceable, or void, then both FHKC and
INSURER shall be relieved of all obligations arising under such provisions. If
the remainder of this Agreement is capable of performance, it shall not be
affected by such declaration or finding and shall be fully performed. In
addition, if the laws or regulations governing this Agreement should be amended
or judicially interpreted so as to render the fulfillment of the Agreement
impossible or economically infeasible, both FHKC and INSURER will be discharged
from further obligations created under the terms of this Agreement.

4-11 Attorney Fees

In the event that either party deems it necessary to take legal action to
enforce any provision of this Agreement, the court or hearing officer, in his
discretion, may award costs and attorney fees to the prevailing party. Legal
actions are defined to include administrative proceedings.

4-12 Representatives

Each party shall designate a representative serving as the day-to-day management
of FHKC Health Insurance Plan, helping to resolve services questions, assuring
proper arbitration in the event of a dispute, as well as responding to general
administrative and procedural problems. These individuals will be the principal
points of contact for all inquiries unless the designated representatives
specifically refer the inquiry to another party within their respective
organizations.

4-13 Termination

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Page 24 of 44

A. Termination for Cause

FHKC shall have the absolute right to terminate for cause this Agreement, and
all obligations contained hereunder. Cause shall be defined as “any material
breach of insurer’s responsibilities as set forth herein, which cannot be cured
by INSURER within 30 days from the date of written notice from FHKC but, if the
default condition cannot be cured within the 30 days, INSURER may, if it has
commenced reasonable efforts to correct the condition within that 30 day period,
have up to 90 days to complete the required cure.” Nothing in this Agreement
shall extend this 90 day period except the mutual consent of the parties hereto.

INSURER shall have the absolute right to terminate for cause this Agreement, and
all obligations contained hereunder. Cause shall be defined as “any material
breach of FHKC’s responsibilities as set forth herein, which cannot be cured by
FHKC within 30 days from the date of written notice from INSURER but, if the
default condition cannot be cured within the 30 days, FHKC may, if it has
commenced reasonable efforts to correct the condition within that 30 day period,
have up to 90 days to complete the required cure.” Nothing in this Agreement
shall extend this 90 day period except the mutual consent of the parties hereto.

B. Change of Controlling Interest

FHKC shall have the absolute right to elect to continue or terminate this
Agreement, at its sole discretion, in the event of a change in the ownership or
controlling interest of INSURER. INSURER shall provide notice of regulatory
agency approval prior to any transfer or change in control, and FHKC shall have
ten (10) days thereafter to elect continuation or termination of this Agreement.

C. Lack of Funding

FHKC shall the absolute right to terminate this Agreement should state, federal
or other funds for the Program be reduced or terminated such that the Program
cannot be sustained at the sole discretion of FHKC. Should FHKC elect to
terminate this Agreement, FHKC shall provide the INSURER a written notice of
termination and include a termination date of not less than thirty (30) days
from the date of the notice.

4-14 Contingency

This Agreement and all obligations created hereunder, are subject to
continuation and approval of funding of FHKC by the appropriate state and
federal or local agencies.

IN WITNESS WHEREOF the parties hereto have executed this Agreement on the 28 day
of September 2005.

HEALTHEASE OF FLORIDA, INC.

BY:

     
/s/ Andrea Rosa     
  /s/ Todd S. Farha     
 
   
Witness
  Name: Todd S. Farha

      Title: President and Chief Executive Officer

1

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 25 of 44

WELLCARE HMO, INC.

BY:

          /s/ Andrea Rosa______________________   /s/ Todd S.
Farha________________________

 
             

 
       
Witness
  Name: Todd S. Farha  

 
            Title: President and Chief Executive Officer

 
       
 
  FLORIDA HEALTHY KIDS CORPORATION
BY:  

 
        /s/ Jennifer K. Lloyd______________________/s/ Rose M.
Naff________________________
   
 
         

 
       
Witness
  Rose M. Naff
Executive Director  

 
       
HEALTHEASE AND STAYWELL HMO
      Effective Date; October 1, 2005

Page 26of44

EXHIBIT A

HEALTH SERVICES AGREEMENT

I. Premium Rate

The Comprehensive Health Care Services premium for Participants in the Florida
Healthy Kids Health Insurance Program for the coverage period October 1, 2005
through September 30, 2006 shall be:

     
As to HealthEase:
 

Citrus County:
  $89.33 per Participant per month
 
   
Duval County:
Escambia County:
Highlands County:
Jefferson County:
Lake County
Madison County:
Martin County:
Putnam County:
Wakulla County:
  $105.31 per Participant per month
$93.52 per Participant per month
$103.18 per Participant per month
$90.71 per Participant per month
$68.47 per Participant per month
$90.71 per Participant per month
$92.64 per Participant per month
$85.09 per Participant per month
$89.33 per Participant per month
 
   
As to WellCare:
 

Brevard County:
Broward County:
Charlotte County:
Collier County:
Miami-Dade County:
DeSoto County:
Hernando County:
Hillsborough County:
Lee County:
Manatee County:
Orange County:
Osceola County:
Palm Beach County:
Pinellas County:
Sarasota County:
Seminole County:
  $83.68 per Participant per month
$89.20 per Participant per month
$90.71 per Participant per month
$90.71 per Participant per month
$89.20 per Participant per month
$90.71 per Participant per month
$115.95 per Participant per month
$73.90 per Participant per month
$89.20 per Participant per month
$90.71 per Participant per month
$73.90 per Participant per month
$73.90 per Participant per month
$89.20 per Participant per month
$73.90 per Participant per month
$90.71 per Participant per month
$73.90 per Participant per month

II. Additional Requirements for Premium Rates

The rate listed in Paragraph I of this Exhibit also incorporates the following
requirements:

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A. Minimum Medical Loss Ratio

      The minimum medical loss ratio shall be eighty-five percent (85%).

B. Maximum Administrative Component

The maximum administrative cost for the premium listed in Section I of this
Exhibit shall not exceed fifteen percent (15%).

III. Experience Adjustment

In the event that the medical loss ratio for this Agreement is better than
eighty-five percent (85%) in the aggregate for both WellCare and HealthEase
calculated in the same manner as the premium development and allocation
methodology utilized in the insurer’s original rate proposal in its response to
the RFP, INSURER shall share equally with FHKC the dollar difference between the
actual loss ratio for said period and the predicted eighty-five percent (85%).

The INSURER shall provide annually FHKC with a written copy of its findings each
year during the term of this Agreement by February 1st. If any payments are due
under this provision, INSURER shall forward such payment with its written
notification. The INSURER may be subject to audit or verification by FHKC or its
designated agents.

FHKC shall determine the adequacy of the information supplied under this section
and whether or not the calculation has been accurately performed in the manner
prescribed below.

The Calculation shall be illustrated in the following manner:

A. Total Premiums Paid During Year: $
B. Target Incurred Claims’: 85% of A
C. Actual Incurred Claims for Year: $
D. Difference Between Target Incurred Claims and Actual Incurred Claims: $
(Subtract
Line C from Line B)
E. Amount Due FHKC (50% of Line D): $

’ The target medical loss ratio for this Agreement and for this calculation is
85%.

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EXHIBIT B

ENROLLMENT PROCEDURES

  1   All FHKC eligible Participants will be provided with necessary enrollment
materials and forms from FHKC or its assignee.

  2.   FHKC will provide INSURER with eligible Participants who have selected
INSURER or who have been assigned by FHKC to INSURER according to the provisions
of Section 2-1 via an enrollment report in a format mutually agreed upon by the
Parties.  

  3.   Upon receipt of each enrollment report, INSURER acting as an agent for
FHKC, shall provide each Participant with an enrollment package within five
(5) business days of receipt of an enrollment report . The enrollment packet
shall include, at a minimum, the following items:

  A.   A membership card displaying Participant’s name, participation number and
effective date of coverage.  

  B.   A Participant’s handbook that complies with any federal requirements and
has been approved by FHKC, including, at a minimum, a description of how to
access services, a listing of the benefits and any co-payment requirements for
those benefits, the insurer’s grievance process, insurer’s customer services
contact information and the rights and responsibilities for both the Participant
and INSURER.

  C.   A current listing of all primary care physicians, specialists, other
ancillary providers and hospitals available to the Participant and also
identifies the location of the provider’s offices, any age restrictions and
contact information for each provider.

  4.   Upon receipt of the monthly enrollment files from FHKC, INSURER will
process all enrollments and provide new Participants with an enrollment package
as described above within five (5) business days of receipt of each enrollment
report.

  5.   Deletions will be processed by INSURER and INSURER will notify each
cancelled Participant in

writing by regular mail of the effective date of the cancellation within five
(5) business days of receipt of the enrollment data.

  6.   In accordance with state law, a minimum waiting period of sixty (60) days
will be imposed on

those Participants who voluntarily cancel their coverage by non-payment of the
required monthly premium. Cancelled Participants must request reinstatement from
FHKC and wait at least sixty (60) days from the date of that request before
coverage can be reinstated.

  7.   FHKC is the sole determiner of eligibility and effective dates of
coverage.

  8.   INSURER must also comply with the guidance issued by the Office of Civil
Rights of the United States Department of Health and Human Services (“Policy
Guidance on the Title VI Prohibition against National Origin Discrimination as
it Effects Persons with Limited English Proficiency”) regarding the availability
of information and assistance for persons with limited English proficiency.

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EXHIBIT C

ENROLLEE BENEFIT SCHEDULE

Minimum Benefits; Statutory Requirements
INSURER agrees to provide, at a minimum, those benefits that are prescribed by
state law under §409.815(2)(a-p). INSURER shall pay an Enrollee’s covered
expenses up to a lifetime maximum of $1 million per covered Enrollee.

         
 
  The following health care benefits are included under this Agreement:  

BENEFIT
  LIMITATIONS   CO-PAYMENTS

A. Inpatient Services All covered services provided for the medical care and
treatment of an Enrollee who is admitted as an inpatient to a hospital licensed
under part I of Chapter 3 95. Covered services include:
physician’s services; room and board; general nursing care;
patient meals; use of operating room and related facilities; use of intensive
care unit and services; radiological, laboratory and other diagnostic tests;
drugs; medications;
biologicals; anesthesia and oxygen services; special duty nursing; radiation and
chemotherapy; respiratory therapy; administration of whole blood plasma;
physical, speech and occupational therapy; medically necessary services of other
health professionals.
All admissions must be authorized by INSURER.
The length of the patient stay shall be determined based on
the medical condition of the Enrollee in relation to the
necessary and appropriate level of care.
Room and board may be limited to semi-private
accommodations, unless a private room is considered
medically necessary or semi-private accommodations are
not available.
Private duty nursing limited to circumstances where such
care is medically necessary.
Admissions for rehabilitation and physical therapy are
limited to 15 days per contract year.
Shall Not Include Experimental or Investigational
Procedures as defined as a drug, biological product, device,
medical treatment or procedure that meets any one of the
following criteria, as determined by INSURER.
1. Reliable evidence shows the drug, biological product, device, medical
treatment, or procedure when applied to the circumstances of a particular
patient, is the subject of ongoing phase I, II or III clinical trials or
2. Reliable evidence shows the drug, biological product, device, medical
treatment or procedure when applied to the circumstances of a particular
patient, is under study with a written protocol to determine maximum tolerated
dose, toxicity, safety, efficacy, or efficacy in comparison to conventional
alternatives, or
3. Reliable evidence shows the drug, biological product, device, medical
treatment, or procedure is being delivered or should be delivered subject to the
approval and supervision of an Institutional Review Board (IRB) as required and
defined by federal regulations, particularly those of the U.S. Pood and Drug
Administration or the Department of Health and Human Services.
NONE

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BENEFIT LIMITATIONS CO-PAYMENTS
B. Emergency Services Covered services include visits to an emergency room or
other licensed facility, if needed immediately, due to an injury or illness and
delay means risk of permanent damage to the Enrollee’s health.
Must use an INSURER designated facility or provider for emergency care unless
the time to reach such facilities or providers would mean the risk of permanent
damage to patient’s health.

INSURER must also comply with the provisions ofs. 641.513, Florida Statutes.
$10 per visit waived if admitted or authorized by primary care physician.

Infant is covered for up to three (3) days following birth or until the infant
is transferred to another medical facility, whichever occurs first.

Coverage may be limited to the fee for vaginal deliveries.
C. Maternity Services and Newborn Care Covered services include maternity and
newborn care;
prenatal and postnatal care;
initial inpatient care of adolescent Participants, including nursery charges and
initial pediatric or neonatal examination.
NONE

D. Organ Transplantation
Services
Covered services include
pretransplant, transplant and
postdischarge services and
treatment of complications
after transplantation.
Coverage is available for transplants and medically related services if deemed
necessary and appropriate within the guidelines set by the Organ Transplant
Advisory Council or the Bone Marrow Transplant Advisory Council.
NONE

E. Outpatient Services Preventive, diagnostic, therapeutic, palliative care, and
other services provided to an Enrollee in the outpatient portion of a health
facility licensed under chapter 395.

Covered services include well-child care, including those services recommended
in the Guidelines for Health Supervision of Children and Youth as developed by
the Academy of Pediatrics;
immunizations and injections as recommended by the Advisory Committee on
Immunization Practices; health education counseling and clinical services;
family planning services; vision screening; hearing screening;
clinical radiological, laboratory and other outpatient diagnostic tests;
ambulatory surgical procedures; splints and casts;

consultation with and treatment by referral physicians;

radiation and chemotherapy;

, chiropractic services; podiatric
Services must be provided directly by INSURER or through pre-approved referrals.

Routine hearing and screening must be provided by primary care physician.

Family planning limited to one annual visit and one supply visit each ninety
days.

Chiropractic services shall be provided in the same manner as in the Florida
Medicaid program.

Podiatric services are limited to one visit per day totaling two visits per
month for specific foot disorders. Dental services must be provided by an oral
surgeon for medically necessary reconstructive dental surgery due to injury.

Immunizations are to be provided by the primary care physician.

Treatment for temporomandibular joint (TMJ) disease is specifically excluded.

Shall Not Include Experimental or Investigational Procedures as defined as a
drug, biological product, device, medical treatment or procedure that meets any
one of the following criteria, as determined by INSURER:
1. Reliable evidence shows the drug, biological product, device, medical
treatment, or procedure when applied to the circumstances of a particular
patient, is the subject of ongoing phase I, II or III clinical trials or
No Co-Payment for well- child care, preventive care or for routine vision and
hearing screenings.

$5 per office visit.

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6

BENEFIT LIMITATIONS CO-PAYMENTS
services.
2. Reliable evidence shows the drug, biological product, device, medical
treatment or procedure when applied to the circumstances of a particular
patient, is under study with a written protocol to determine maximum tolerated
dose, toxicity, safety, efficacy, or efficacy in comparison to conventional
alternatives, or
3. Reliable evidence shows the drug, biological product, device, medical
treatment, or procedure, is being delivered or should be delivered subject to
the approval and supervision of an Institutional Review Board (IRB) as required
and defined by federal regulations, particularly those of the U.S. Food and Drug
Administration or the Department of Health and Human Services.
E. Behavioral Health Services Covered services include inpatient and outpatient
care for psychological or psychiatric evaluation, diagnosis and treatment by a
licensed mental health professional.
All services must be provided directly by INSURER or upon approved referral.

Inpatient services are limited to not more than thirty inpatient days per
contract year for psychiatric admissions, or residential services in lieu of
inpatient psychiatric admissions; however, a minimum often of the thirty days
shall be available only for inpatient psychiatric services when authorized by
INSURER physician.

Outpatient services are limited to a maximum of forty outpatient visits per
contract year.
INPATIENT:
NONE
OUTPATIENT: $5 per visit

F. Substance Abuse Services
Includes coverage for inpatient and outpatient care for drug and alcohol abuse
including counseling and placement assistance.
Outpatient services include evaluation, diagnosis and treatment by a licensed
practitioner.
All services must be provided directly by INSURER or upon approved referral.

Inpatient services are limited to not more than seven inpatient days per
contract year for medical detoxification only and thirty days residential
services.

Outpatient visits are limited to a maximum of forty visits per contract year.
INPATIENT:
NONE
OUTPATIENT: $5 per visit

G. Therapy Services Covered services include physical, occupational, respiratory
and speech therapies for short-term rehabilitation where significant improvement
in the Enrollee’s condition will result.
All treatments must be performed directly or as authorized by INSURER.

Limited to up to twenty-four treatment sessions within a sixty day period per
episode or injury, with the sixty day period beginning with the first treatment.
$5 per visit

I. Hospice Services Covered services include reasonable and necessary services
for palliation or management of an Enrollee’s terminal illness.
Once a family elects to receive hospice care for an Enrollee, other services
which treat the terminal condition will not be covered.

Services required for conditions totally unrelated to the terminal condition are
covered to the extent that the services are covered under thisAgreement.
$5 per visit

All admissions must be authorized by INSURER and provided by an INSURER
affiliated facility. Participant must require and receive skilled services on a
daily basis as ordered by INSURER physician. The length of the Enrollee’s stay
shall be determined by the
J.Nursing Facility Services

Covered services include regular nursing services, rehabilitation services,
drugs
NONE

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 32 of 44

          BENEFIT LIMITATIONS CO-PAYMENTS     medical condition of the Enrollee
in relation to         the necessary and appropriate level of care, but        
is no more than 100 days per contract year.         Room and board is limited to
semi-private         accommodations unless a private room is         considered
medically necessary or semi-private         accommodations are not available.
Specialized         treatment centers and independent kidney disease     and
biologicals, medical   treatment centers are excluded. Private duty    
supplies, and the use of   nurses, television, and custodial care are    
appliances and equipment   excluded. Admissions for rehabilitation and    
furnished by the   physical therapy are limited to fifteen days per    
facility.   contract year.     K. Durable Medical         Equipment and
Prosthetic         Devices Equipment and   Equipment and devices must be
provided by     devices that are   authorized INSURER supplier.     medically
indicated to   Covered prosthetic devices include artificial     assist in the
treatment   eyes and limbs, braces, and other artificial     of a medical
condition   aids.     and specifically   Low vision and telescopic lenses are
not included.     prescribed as medically   Hearing aids are covered only when
medically     necessary by Enrollee's   indicated to assist in the treatment of
a medical     INSURER physician.   condition.   NONE
L. Refractions
  Enrollee must have failed vision screening by
primary care physician.
Corrective lenses and frames are limited to one
pair every two years unless head size or
prescription changes.
Coverage is limited to Medicaid frames with
plastic or SYL non-tinted lenses.   $5 per visit
$10 for corrective
lenses

 
       
Examination by an INSURER
optometrist to determine
the need for and to
prescribe corrective
lenses as medically
indicated.
 

 

 
       
M. Pharmacy
  Prescribed drugs covered under this Agreement
shall include all prescribed drugs covered under
the Florida Medicaid program. INSURER may
implement a pharmacy benefit management program
ifFHKC so authorizes. Brand name products are
covered if a generic substitution is not
available or where the prescribing physician
indicates that a brand name is medically
necessary. All medications must be dispensed
through INSURER or an INSURER designated
pharmacy. All prescriptions must be written by
the Participant’s primary care physician, INSURER
approved specialist or consultant physician or
Enrollee’s dental provider.   $5 per prescription
for up to a 31 -day
supply

 
       
Prescribed drugs for the
treatment of illness or
injury.
 

 

 
       
N. Transportation Services
  Must be in response to an emergency situation.   $10 per service
 
       
Emergency transportation
as determined to be
medically necessary in
response to an emergency
situation.
 

 

II. Cost Sharing Provisions

INSURER agrees to comply with all Cost Sharing restrictions imposed on FHKC
Participants by federal or state laws and regulations, including the following
specific provisions:

A. Special Populations

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7

Enrollees identified by FHKC to INSURER as Native Americans or Alaskan Natives
are prohibited from paying any Cost Sharing amounts.

B. Cost Sharing Limited to No More than Five Percent of Family’s Income

FHKC may identify to INSURER other Enrollees who have met federal requirements
regarding maximum out-of-pocket expenditures. Enrollees identified by FHKC as
having met this threshold are not required to pay any further Cost Sharing for
covered services for a time specified by FHKC.

C. INSURER is responsible for informing its providers of these provisions and
ensuring that

Enrollees under this section incur no further out-of-pocket-costs for covered
services and are not denied access to services. FHKC will provide these
Enrollees with a letter indicating that they may not incur any Cost Sharing
obligations and shall provide written notification to INSURER of any such
Participants.

III. Other Benefit Provision

All requirements for prior authorizations must conform with federal and state
regulations and must be completed within fourteen (14) days of request by the
Enrollee. Extensions to this process may be granted in accordance with federal
and/or state regulations.

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Page 34 of 44
EXHIBIT D
WORKERS’ COMPENSATION, THIRD PARTY CLAIM,
PERSONAL INJURY PROTECTION BENEFITS,
AND COORDINATION OF BENEFITS

A. WORKERS’ COMPENSATION

Workers’ compensation benefits are primary to all benefits that may be provided
pursuant to this Agreement. In the event INSURER provides services or benefits
to a Participant who is entitled to workers’ compensation benefits, INSURER
shall complete and submit to the appropriate carrier, such forms, assignments,
consents and releases as are necessary to enable INSURER to obtain payment, or
reimbursement, under the workers’ compensation law.

B. THIRD PARTY CLAIMS

In the event INSURER provides medical services or benefits to Participants who
suffer injury, disease or illness by virtue of the negligent act or omission of
a third party, INSURER shall be entitled to reimbursement from the Participant,
at the prevailing rate, for the reasonable value of the services or benefits
provided. INSURER shall not be entitled to reimbursement in excess of the
Participant’s monetary recovery for medical expenses provided from the third
party.

  C.   NO-FAULT. PERSONAL INJURY PROTECTION AND MEDICAL PAYMENTS

      COVERAGE

As noted in the Florida Statutes (F.S. 641.31(8)), automobile no-fault, personal
injury protection, and medical payments insurance, maintained by or for the
benefit of the Participant, shall be primary to all services or benefits that
may be provided pursuant to this Agreement. In the event INSURER provides
services or benefits to a Participant who is entitled to the aforesaid
automobile insurance benefits, the parent/guardian or Participant shall complete
and submit to INSURER, or to the automobile insurance carrier, such forms,
assignments, consents and releases as are necessary to enable INSURER to obtain
payment or reimbursement from such automobile insurance carrier.

D. COORDINATION OF BENEFITS AMONG HEALTH INSURERS

INSURER shall coordinate benefits in accordance with NAIC principles as may be
amended from time to time and in accordance with Section 624.91(5)(c).

  E.   None of the above rules as to coordination of benefits shall limit the
Participant’s right to receive direct health services hereunder.

  F.   Any Participant claiming benefits under this Agreement shall furnish to
INSURER all information deemed necessary by it to implement this provision.  

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EXHIBIT E

ACCESS and CREDENTIALING STANDARDS

INSURER shall maintain a medical staff, under contract, sufficient to permit
reasonably prompt medical services to all Participants in accordance with the
following:

  1.   Physician and Facility Standards

A. Physician and Medical Provider Standards

insurer’s primary care provider network shall include only board certified
pediatricians and family practice physicians or physician extenders working
under the direct supervision of a board certified practitioner to serve as
primary care physicians in its provider network for the counties covered under
this Agreement.

All Primary care physicians must provide covered immunizations to Enrollees.

The INSURER may request that an individual provider be granted an exception to
this policy by making such a request in writing to the corporation and providing
the provider’s curriculum vitae and a reason why the provider should be granted
an exception to the accepted standard. Such requests will be reviewed by the
corporation on a case-by-case basis and a written response will be made to
INSURER on the outcome of the request.

B. Facility Standards

Facilities used for Participants shall meet applicable accreditation and
licensure requirements and meet facility regulations specified by the Agency for
Health Care Administration.

  2.   Geographical Access:

A. Primary Care Providers

Geographical access to board certified family practice physicians, pediatric
physicians, primary care dental providers or ARNP’s experienced in child health
care of approximately twenty (20) minutes driving time from residence to
provider, except that this driving time limitation shall be reasonably extended
in those areas where such limitation with respect to rural residence is
unreasonable. In such instance, INSURER shall provide access for urgent care
through contracts with nearest providers.

B. Specialty Physician Services

Specialty physician services, ancillary services and specialty hospital services
are to be available within sixty (60) minutes driving time from the
Participant’s residence to provider. Driving time standards may be waived with
sufficient justification if specialty care services are not obtainable due to a
limitation of providers, such as in rural areas.

Timely Treatment:

Timely treatment by providers, such that the Participant shall be seen by a
provider in accordance

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.Page 36 of 44

10

with the following:

A. B. C.
D. E.

Emergency care shall be provided immediately;
Urgently needed care shall be provided within twenty-four (24) hours;
Routine care of patients who do not require emergency or urgently needed care
shall be provided within seven (7) calendar days;
Routine physical examinations shall be provided within four (4) weeks of
Enrollee’s request; and
Follow-up care shall be provided as medically appropriate.
For the purposes of this section, the following definitions shall apply:

Emergency care is that care required for the treatment of an injury or acute
illness that, if not treated immediately, could reasonably result in serious or
permanent damage to the patient’s health.

Urgently needed care is that care required within a twenty-four (24) hour period
to prevent a condition from requiring emergency care.

Routine care is that level of care that can be delayed without anticipated
deterioration in the patient’s medical condition for a period of seven
(7) calendar days.

By utilization of the foregoing standards, FHKC does not intend to create
standards of care or access different from those that are deemed acceptable
within the INSURER service area. Rather FHKC intends that the provider timely
and appropriately respond to patient care needs, as they are presented, in
accordance with standards of care existing within the service area. In applying
the foregoing standards, the provider shall give due regard to the ‘evel of
discomfort and anxiety of the patient and/or parent.

In the event FHKC determines that INSURER, or its providers, has failed to meet
the access standards herein set forth, FHKC shall provide INSURER with written
notice of non-compliance. Such notice may be provided via facsimile or other
means, specifying the failure in such detail as will reasonably allow INSURER to
investigate and respond. Failure of INSURER to obtain reasonable compliance or
acceptable community care under the following conditions shall constitute a
breach of this Agreement:

A. immediately upon receipt of notice for emergency or urgent problem; or
B. within ten (10) days of receipt of notice for routine visit access.

Such breach shall entitle FHKC to such legal and equitable relief as may be
appropriate. In particular, FHKC may direct its Participants to obtain such
services outside the Insurer Provider network as specified in Section 3-2-1 of
this Agreement. INSURER shall be financially responsible for all services under
this provision.

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EXHIBIT F

ELIGIBILITY STANDARDS

Participant Eligibility Criteria

The following eligibility criteria for participation in the Healthy Kids Program
must be met:

  1.   The Participants must be children who are age 5 through 18. Participants
who applied for coverage prior to July 1, 1998, and who had attained the age of
19 by March 31, 2004, are eligible for coverage through their 19th birthday.  

In accordance with the terms of the Request for Proposals dated April 2004, some
children may have age eligibility from age 18 months through age 4, depending on
their county of residence.

  2.   Participants must meet the eligibility criteria established under
§624.91, Florida Statutes, and as implemented by FHKC Board of Directors.  

  3.   Eligible Participants may enroll during time periods established by FHKC
Board of Directors and in accordance with Section 409.8134(2), Florida Statutes.
 

  4.   Determination of eligibility for the Healthy Kids Program is made solely
by the Florida Healthy Kids Corporation.  

  5.   Any requests by the INSURER for review of a Participant’s eligibility
shall be made exclusively through the procedure set forth in Section 3-6 of this
Agreement.  

  6.   If the eligibility requirements set forth in this Exhibit F become in
conflict with the eligibility requirements set forth under Florida law, the
eligibility requirements under Florida law shall control.  

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EXHIBIT G

REPORTING REQUIREMENTS

INSURER shall provide the following reports and data tapes to FHKC according to
the time schedules detailed below. This information shall include all services
provided by insurer’s subcontractors. INSURER is responsible for ensuring that
all subcontractors comply with these reporting requirements.

I. Data Tape

A quarterly data tape shall be prepared that will contain the following data
fields. The tape shall reflect claims and encounters entered during the quarter
and shall be delivered to FHKC according to the time table listed below. INSURER
shall also provide quarterly tapes that reflect claims run-off once this
Agreement between INSURER and FHKC terminates.

REQUIRED DATA FIELDS TO BE CAPTURED

  •   Provider’s name, address and tax I.D. number (and payee’s group number if
applicable).

  •   Patient’s name, address, social security number, I.D. number, birth date,
and sex.

  •   Third party payor information, including amount(s) paid by other payor(s).

  •   Primary and secondary diagnosis code(s) and treatment(s) related to
diagnosis.

  •   Date(s) of service.

  •   Procedure code(s).

  •   Unit(s) of service.

  •   Total charge(s).

  •   Total payment(s).

Additional required hospital fields include the following:

• Date and type of admission (emergency, outpatient, inpatient, newborn, etc.).

• For inpatient care: covered days and date of discharge.

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EXHIBIT G
(Continued)

Specific pharmacy fields include:

  •   Pharmacy name and tax I.D. number.

  •   Other payor information.

  •   Rx number and date filled.

  •   National drug code, manufacturer number, item number, package size,
quantity, days supply.  

  •   Prescriber’s Florida Department of Professional Regulations number.

REQUIRED TAPE FORMAT SPECIFICATIONS

      The tape format is as follows or an alternative format as mutually agreed
upon by both parties:  

  •   1600 BPI

  •   EBCDIC

  •   9 Track

  •   No labels.

  •   Each file not to exceed 100 megs in size.

  •   Fixed record length.

TIME TABLE FOR DELIVERY OF TAPE

     
 
   
 
   
For encounters and claims processed during:
  Claims tape due to FHKC by:
 
   
January 1 — March 31
  April 15
 
   
April 1 — June 30
  July 15
 
   
July 1 — September 30
  October 15
 
   
October 1 — December 31
  January 15

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

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14

EXHIBIT H

CERTIFICATION REGARDING DEBARMENT, SUSPENSION, INELIGIBILITY, AND VOLUNTARY
EXCLUSION CONTRACTS AND SUBCONTRACTS

This certification is required by the regulations implementing Executive Order
12549, Debarment and Suspension, signed February 18,1986. The guidelines were
published in the May 29,1987, Federal
Register (52 Fed. Reg., pages 20360-20369).

INSTRUCTIONS

A. Each Insurer whose contract\subcontract equals or exceeds $25,000 in federal
monies must sign this certification prior to execution of each
contract\subcontract. Additionally, Insurers who audit federal programs must
also sign, regardless of the contract amount. The Florida Healthy Kids
Corporation cannot contract with these types of Insurers if they are debarred or
suspended by the federal government.

B. This certification is a material representation of fact upon which reliance
is placed when this contract\subcontract is entered into. If it is later
determined that the signer knowingly rendered an erroneous certification, the
Federal Government may pursue available remedies, including suspension and/or
debarment.

C. The Insurer shall provide immediate written notice to the contract manager at
any time the Insurer learns that its certification was erroneous when submitted
or has become erroneous by reason of changed circumstances.

D. The terms “debarred,” “suspended,” “ineligible,” “person,” “principal,” and
“voluntarily excluded,” as used in this certification, have the meanings set out
in the Definitions and Coverage sections of rules implementing Executive Order
12549. You may contact the contract manager for assistance in obtaining a copy
of those regulations.

E. The Insurer agrees by submitting this certification that it shall not
knowingly enter into any subcontract with a person who is debarred, suspended,
declared ineligible, or voluntarily excluded from participation in this
contract/subcontract unless authorized by the federal government.

F. The Insurer further agrees by submitting this certification that it will
require each subcontractor of this contract/subcontract whose payment will equal
or exceed $25,000 in federal monies, to submit a signed copy of this
certification.

G. The Florida Healthy Kids Corporation may rely upon a certification of an
Insurer that it is not debarred, suspended, ineligible, or voluntarily excluded
from contracting\suhcontracting unless it knows that the certification is
erroneous.

H. This signed certification must be kept in the contract manager’s file.
Subcontractor’s certifications must be kept at the contractor’s business
location.

CERTIFICATION

The prospective Insurer certifies, by signing this certification, that neither
he nor his principals is presently debarred, suspended, proposed for debarment,
declared ineligible, or voluntarily excluded from participation in this
contract/subcontract by any federal agency.

Where the prospective Insurer is unable to certify to any of the statements in
this certification, such prospective Insurer shall attach an explanation to this
certification.

         
Signature /s/ Todd S. Farha
Name and Title of Authorized Signee
Todd S. Farha
President and Chief Executive Officer
  Date September 28, 2005

 

 
       
HEALTHEASE AND STAYWELL HMO
      Effective Date: October 1, 2005

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15

EXHIBIT I

CERTIFICATION REGARDING LOBBYING
CERTIFICATION FOR CONTRACTS, GRANTS. LOANS AND COOPERATIVE AGREEMENTS

The undersigned certifies, to the best of his or her knowledge and belief, that:

  (1)   No federal appropriated funds have been paid or will be paid, by or on
behalf of the undersigned, to any person for influencing or attempting to
influence an officer or employee of any agency, a member of congress, an officer
or employee of congress, or an employee of a member of congress in connection
with the awarding of any federal contract, the making of any federal grant, the
making of any federal loan, the entering into of any cooperative agreement, and
the extension, continuation, renewal, amendment, or modification of any federal
contract, grant, loan, or cooperative agreement.

  (2)   If any funds other than federal appropriated funds have been paid or
will be paid to any person for influencing or attempting to influence an officer
or employee of any agency, a member of congress, an officer or employee of
congress, or an employee of a member of congress in connection with this federal
contract, grant, loan, or cooperative agreement, the undersigned shall complete
and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in
accordance with its instructions.  

  (3)   The undersigned shall require that the language of this certification be
included in the award documents for all subawards at all tiers (including
subcontracts, subgrants, and contracts under grants, loans, and cooperative
agreements) and that all subrecipients shall certify and disclose accordingly.

This certification is a material representation of fact upon which reliance was
placed when this transaction was made or entered into. Submission of this
certification is a prerequisite for making or entering into this transaction
imposed by section 1352, Title 31, U.S. Code. Any person who fails to file the
required certification shall be subject to a civil penalty of not less than
$10,000 and not more than $100,000 for each such failure.

/s/ Todd S. Farha     September 28, 2005_     
Signature Date

Todd S. Farha      
Name of Authorized Individual

HealthEase of Florida, Inc. and Well Care HMO, Inc. 8725 Henderson Road, Ren 2
Tampa, FL

33634

Name and Address of Organization

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

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16

EXHIBIT J

CERTIFICATION

REGARDING HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT OF 1996 COMPLIANCE

This certification is required for compliance with the requirements of the
Health Insurance Portability and Accountability Act of 1996 (HEPAA).

The undersigned INSURER certifies and agrees as to abide by the following:

  1.   Protected Health Information. For purposes of this Certification,
Protected Health Information shall have the same meaning as the term “protected
health information” in 45 C.F.R. § 164.501, limited to the information created
or received by the INSURER from or on behalf of FHKC.

  2.   Limits on Use and Disclosure of Protected Health Information (PHI) The
INSURER shall not use or disclose Protected Health Information other than as
permitted by this Agreement or by federal and state law. The INSURER will use
appropriate safeguards to prevent the use or disclosure of Protected Health
Information for any purpose not in conformity with this Agreement and federal
and state law. The INSURER will not divulge, disclose, or communicate in any
manner any Protected Health Information to any third party without prior written
consent from FHKC. The INSURER will report to FHKC, within two (2) business days
of discovery, any use or disclosure of Protected Health Information not provided
for in this Agreement of which the INSURER is aware. A violation of this
paragraph shall be a material violation of this Agreement.

  3.   Use and Disclosure of Information for Management, Administration, and
Legal Responsibilities. The INSURER is permitted to use and disclose Protected
Health Information received from FHKC for the proper management and
administration of the INSURER or to carry out the legal responsibilities of the
INSURER, in accordance with 45 C.F.R. 164.504(e)(4). Such disclosure is only
permissible where required by law, or where the INSURER obtains reasonable
assurances from the person to whom the Protected Health Information is disclosed
that: (1) the Protected Health Information will be held confidentially, (2) the
Protected Health Information will be used or further disclosed only as required
by law or for the purposes for which it was disclosed to the person, and (3) the
person notifies the INSURER of any instance of which it is aware in which the
confidentiality of the Protected Health Information has been breached.

  4.   Disclosure to Subcontractors or Agents. The INSURER agrees to enter into
a subcontract with any person, including a subcontractor or agent, to whom it
provides Protected Health Information received from, or created or received by
the INSURER on behalf of, FHKC. Such subcontract shall contain the same terms,
conditions, and restrictions that apply to the INSURER with respect to Protected
Health Information.

  5.   Access to Information. The INSURER shall make Protected Health
Information available in accordance with federal and state law, including
providing a right of access to persons who are the subjects of the Protected
Health Information.

  6.   Amendment and Incorporation of Amendments. The INSURER shall make
Protected Health Information available for amendment and to incorporate any
amendments to the Protected Health Information in accordance with 45 C.F.R. §
164.526.

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

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17

  7.   Accounting for Disclosures. The INSURER shall make Protected Health
Information available as required to provide an accounting of disclosures in
accordance with 45 C.F.R. § 164.528.  

  8.   Access to Books and Records. The INSURER shall make its internal
practices, books, and records

relating to the use and disclosure of Protected Health Information received
from, or created or received by the INSURER on behalf of, FHKC to the Secretary
of the Department of Health and Human Services or the Secretary’s designee for
purposes of determining compliance with the Department of Health and Human
Services Privacy Regulations.

  9.   Termination. At the termination of this Agreement, the INSURER shall
return all Protected Health Information that the INSURER still maintains in any
form, including any copies or hybrid or merged databases made by the INSURER; or
with prior written approval of FHKC, the Protected Health Information may be
destroyed by the INSURER after its use. If the Protected Health Information is
destroyed pursuant to FHKC’s prior written approval, the INSURER must provide a
written confirmation of such destruction to FHKC. If return or destruction of
the Protected Health Information is determined not feasible by FHKC, the INSURER
agrees to protect the Protected Health Information and treat it as strictly
confidential.

CERTIFICATION     

The INSURER and the Florida Healthy Kids Corporation have caused this
Certification to be signed and delivered by their duly authorized
representatives, as of the date set forth below.

INSURER Name:

Signature /s/ Todd S. Farha Date September 28, 2005

Todd S. Farha, President and Chief Executive Officer

Name and Title of Authorized Signee

HEALTHEASE AND STAYWELL HMO Effective Date: October 1, 2005

Page 44 of 44

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