<PAGE>

                                                                   Exhibit 10.31

                                STATE OF FLORIDA
                           DEPARTMENT OF ELDER AFFAIRS
                      AGENCY FOR HEALTH CARE ADMINISTRATION
                            CONTRACT No. 2002-2003-02

This contract is entered into between the State of Florida. Department of Elder
Affairs hereinafter referred to as the "department, " the Agency for Health Care
Administration hereinafter referred to as the "agency:" and Physicians
Healthcare Plans, Inc. hereinafter referred to as the "Contractor."

THE PARTIES AGREE:

        THE CONTRACTOR AGREES:

A.      To provide services according to the conditions specified in Attachment
        I.

B.      FEDERAL LAWS AND REGULATIONS

                If this contract contains federal funds, the Contractor shall
                comply with the provisions of 45 CFR. Part 74. and/or 45 CFR,
                Part 92, and other applicable regulations.

                If this contract contains federal funding, the Contractor must,
                prior to contract execution, complete the Certification
                Regarding Lobbying form, Attachment II. If a Disclosure of
                Lobbying Activities form, Standard Form LLL, is required, it may
                be obtained from the department. All disclosure forms as
                required by the Certification Regarding Lobbying form must be
                completed and returned to the department no more than 10 days
                after contract execution.

        3.      If this contract contains federal funding in excess of $100,000,
                the Contractor shall comply with all applicable standards,
                orders, or regulations issued under Section 306 of the Clean Air
                Act, as amended (42 U.S.C. 1857(h) et seq.). Section 508 of the
                Clean Water Act. as amended (33 U.S.C. 1368 et seq.), Executive
                Order 11738, and Environmental Protection agency regulations (40
                CFR Part 15). The Contractor shall report any violations of the
                above to the department within ten (10) days of the discovery of
                any such violation.

        4.      To comply with the provisions of the U.S. Department of Labor,
                Occupational Safety and Health Administration (OSHA) code, 29
                CFR, Part 1910.1030.

        5.      If this contract contains federal funding in excess of $100,000,
                the Contractor must, prior to contract execution, complete the
                Debarment, Suspension. Ineligibility and Voluntary Exclusion
                Certification form Attachment III.

        6.      To comply with the Department of Health and Human Services
                Privacy Regulations in the Code of Federal Regulations, Title
                45, sections 160 and 164, regarding disclosure of protected
                health information and as specified in Attachment VI.

C.      EMPLOYMENT

        If the Contractor is a non-governmental organization, it is expressly
        understood and agreed that the Contractor will not knowingly employ
        unauthorized alien workers. Such employment constitutes a violation of
        the employment provisions as determined pursuant to section 274A(e) of
        the Immigration & Naturalization Act (INA), 8 U.S.C. s.1324 a (e)
        (section 274A(e)"). Violation of the employment provisions as determined
        pursuant to section 274A(e) shall be grounds for unilateral cancellation
        of this contract.

D.      AUDITS AND RECORDS

                To maintain books, records, and documents (including electronic
                storage media) in accordance with generally accepted accounting
                procedures and practices, which sufficiently and properly
                reflect all revenues and expenditures of funds, provided under
                this contract.

                To assure that these records shall be subject at all reasonable
                times to inspection, review, or audit by state personnel and
                other personnel duly authorized by the department or agency as
                well as by federal personnel.

        3.      To maintain and file with the department such progress, fiscal
                and inventory reports as specified, in Attachment I and other
                reports as the department may require within the period of this
                contract.

        4.      To provide a financial and compliance audit as specified in
                Attachment V, and to ensure that all related party transactions
                are disclosed to the auditor.

        5.      To include these aforementioned audit and record keeping
                requirements in all approved subcontracts and assignments.

        6.      To respond to requests for client information and statistical
                data for research and evaluative purposes when requested by the
                department or agency.

E.      RETENTION OF RECORDS

                Unless otherwise expressly set forth in this contract, the
                Contractor agrees to retain all client records, financial
                records, supporting documents, statistical records, and any
                other documents (including electronic storage media) pertinent
                to this contract for a period of five (5) years after
                termination of this contract, or if an audit has been initiated
                and audit findings have not been resolved, the records shall be
                retained until resolution of the audit findings. Any special
                provisions regarding retention of records must be in accord with
                applicable state or federal law or regulation.

        2.      Persons duly authorized by the department or agency and federal
                auditors, pursuant to 45 CFR, Parts 92.36(i)(10), 92.42(e)(1)
                and (2), and 74.53(e), shall have full access to and the right
                to examine any of said records and documents during said
                retention period.

F.      MONITORING

                To provide reports as specified in Attachment I. These reports
                will be used for monitoring progress or performance of the
                contractual services.

                                   Page 1 of 7

<PAGE>

                To permit persons duly authorized by the department or agency to
                inspect any records, papers, documents, facilities, goods and
                services of the Contractor which are relevant to this contract
                or the mission and statutory authority of the department and
                agency, and/or interview any clients and employees of the
                Contractor to be assured of satisfactory performance of the
                terms and conditions of this contract. Following such inspection
                the department will deliver to the Contractor a list of its
                concerns with regard to the manner in which said goods or
                services are being provided. The Contractor will rectify all
                noted deficiencies provided by the department within the time
                set forth by the department or provide the department with a
                reasonable and acceptable justification for the Contractor's
                failure to correct the noted shortcomings. The department shall
                determine whether such failure is reasonable and acceptable. The
                Contractor's failure to correct or justify within a reasonable
                time as specified by the department may result in the agency
                taking any of the actions identified in the Suspension section,
                or the department and agency deeming the provider's failure to
                be a breach of contract.

G.      INDEMNIFICATION

        If the Contractor is a state or local governmental entity, pursuant to
        subsection 768.28 (18) Florida Statutes, the provisions of this section
        do not apply.

                To indemnify, defend, and hold harmless the department and
                agency and all of their officers, agents, and employees from any
                claim, loss, damage, cost, charge, or expense arising out of any
                acts, actions, neglect or omission by the Contractor, its
                agents, employees, or subcontractors during the performance of
                the contract, whether direct or indirect, and whether to any
                person or property to which the department, agency or said
                parties may be subject, except that neither Contractor nor any
                of its subcontractors will be liable under this section for
                damages arising out of injury or damage to persons or property
                directly caused or resulting from the sole negligence of the
                department, agency or any of their officers, agents, or
                employees.

        2.      Contractor's obligation to indemnify, defend, and pay for the
                defense or at the department's option, to participate and
                associate with the department or agency in the defense and trial
                of any claim and any related settlement negotiations, shall be
                triggered by the department's notice of claim for
                indemnification to Contractor. The Contractor's inability to
                evaluate liability or its evaluation of liability shall not
                excuse the Contractor's duty to defend and indemnify the
                department or agency, upon notice by the department. Notice
                shall be given by registered or certified mail, return receipt
                requested. Only an adjudication or judgment after the highest
                appeal is exhausted specifically finding the department or
                agency solely negligent shall excuse performance of this
                provision by the Contractor. The Contractor shall pay all costs
                and fees related to this obligation and its enforcement by the
                department. The department's failure to notify the Contractor of
                a claim shall not release the Contractor of the above duty to
                defend.

                It is the intent and understanding of the parties that the
                Contractor is not an agent of the department or agency for
                purposes of application of section 768.28. F.S., and is not
                entitled or subject to any of the benefits and limitations
                therein. Contractor expressly agrees to and does hereby waive
                any and all claims or entitlement to any and all application of
                section 768.28 F.S., Contractor may have or may hereafter
                acquire by reason of this agreement or by interpretation of this
                agreement and applicable law by any court of law equity, or by
                or through any other dispute resolution method or forum,
                regarding any all claims that may directly or indirectly arise
                from or otherwise involve Contractor's direct or indirect
                involvement, obligations, or benefits under this agreement. Not
                withstanding the foregoing provisions, nothing in this agreement
                shall serve as a waiver of sovereign immunity, or any other
                defense, by the department or agency. Neither the Contractor nor
                any of its subcontractors are employees of the department or
                agency and shall not hold themselves out as employees or agents
                of the department or agency without specific authorization from
                the department. It is the further intent and understanding of
                the parties that the department or agency does not control the
                employment practices of the Contractor and shall not be liable
                for any wage and hour, employment discrimination, or other labor
                and employment claims, which arise against the Contractor.

H.      INSURANCE

                To provide adequate liability insurance coverage on a
                comprehensive basis and to hold such liability insurance at all
                times during the existence of this contract. The Contractor
                accepts full responsibility for identifying and determining the
                type(s) and extent of liability insurance necessary to provide
                reasonable financial protections for the Contractor and the
                clients to be served under this contract. Upon the execution of
                this contract, the Contractor shall furnish the department
                written verification supporting both the determination and
                existence of such insurance coverage. A self-insurance program
                established and operating under the laws of the State of Florida
                may provide such coverage. The department reserves the right to
                require additional insurance where appropriate.

        2.      If the Contractor is a state agency or subdivision as defined by
                section 768.28. Florida Statutes, the Contractor shall furnish
                the department, upon request, written verification of liability
                protection in accordance with section 768.28, Florida Statutes.
                Nothing herein shall be construed to extend any party's
                liability beyond that provided in section 768.28, Florida
                Statutes. (See also indemnification paragraph above.)

        ABUSE, NEGLECT AND EXPLOITATION REPORTING

        In compliance with Chapter 415. Florida Statutes, an employee of the
        Contractor who knows, or has reasonable cause to suspect, that a child,
        aged person or disabled adult is or has been abused, neglected, or
        exploited, shall immediately report such knowledge or suspicion to the
        State of Florida central abuse registry and tracking system on the
        statewide toll-free telephone number (1-800-96ABUSE)

J.      TRANSPORTATION DISADVANTAGED

        If clients are to be transported under this contract, the Contractor
        will comply with the provisions of Chapter 427, Florida Statutes, and
        Rule Chapter 41-2, Florida Administrative Code.

K.      SAFEGUARDING INFORMATION

        Not to use or disclose any information concerning a recipient of
        services under this contract for any purpose not in conformity with
        applicable state and federal regulations (42 CFR 431.304-307

                                   Page 2 of 7

<PAGE>

        Confidentiality Statement), except upon written consent of the
        recipient, or the custodial parent or legal guardian of the recipient,
        as authorized by law.

L.      CLIENT INFORMATION

        To submit management, program, and client identifiable data, as
        specified in this contract.

M.      ASSIGNMENTS AND SUBCONTRACTS

                To neither assign the responsibility of this contract to another
                party nor subcontract for any of the work contemplated under
                this contract without prior written approval of the department
                and agency. No such approval by the department and agency of any
                assignment or subcontract shall be deemed in any event or in any
                manner to provide for the incurrence of any obligation of the
                department or agency in addition to the total dollar amount
                agreed upon in this contract. All such assignments or
                subcontracts shall be subject to the conditions of this contract
                (except Section I, Paragraph P.I., Section II, Paragraph B., and
                Section I, Paragraph W, unless the subcontractor is a political
                subdivision of the state) and to any conditions of approval that
                the department or agency shall deem necessary.

                Unless otherwise stated in the contract between the Contractor
                and subcontractor, payments made by the Contractor to the
                subcontractor must be within seven (7) working days after
                receipt by the Contractor of full or partial payments from the
                agency in accordance with section 287.0585, Florida Statutes.
                Failure to pay within seven (7) working days will result in a
                penalty charged against the Contractor and paid to the
                subcontractor in the amount of one-half of 1 percent of the
                amount due, per day from the expiration of the period allowed
                herein for payment. Such penalty shall be in addition to actual
                payments owed and shall not exceed fifteen (15) percent of the
                outstanding balance due.

        3.      That this contract and its Attachments I, II, III, IV, V, and VI
                as referenced are binding upon the Contractor, its successors,
                subcontractors, assignees and transferees.

N.      FINANCIAL REPORTS

        To provide financial reports to the department as specified in
        Attachment I.

O.      RETURN OF FUNDS

                To return to the agency any overpayments due to unearned funds
                or funds disallowed pursuant to the terms of this contract that
                were disbursed to the Contractor by the agency. The Contractor
                shall return any overpayment to the agency within forty (40)
                calendar days after either discovery by the Contractor, or
                notification by the agency, of the overpayment. In the event
                that the Contractor or its independent auditor discovers an
                overpayment has been made, the Contractor shall repay said
                overpayment within forty (40) calendar days without prior
                notification from the agency. In the event that the agency first
                discovers an overpayment has been made, the agency will notify
                the Contractor by letter of such a finding. Should repayment not
                be made in a timely manner, the agency will charge interest of
                one (1) percent per month compounded on the outstanding balance
                after forty (40) calendar days after the date of notification or
                discovery.

        2.      For universities located in the state of Florida, should
                repayment not be made within forty (40) calendar days after the
                date of notification, the agency will notify the State
                Comptroller's Office who will then enact a transfer of the
                amounts owed from the state university's account to the account
                of the Agency for Health Care Administration.

P.      PURCHASING

                PRIDE
                It is expressly understood and agreed that any articles which
                are the subject of, or are required to carry out this contract
                shall be purchased from Prison Rehabilitative Industries and
                Diversified Enterprises. Inc. (PRIDE) identified under Chapter
                946. Florida Statutes, in the same manner and under the
                procedures set forth in subsections 946.515(2) and (4), Florida
                Statutes. For purposes of this contract, the person, firm, or
                other business entity carrying out the provisions of this
                contract shall be deemed to be substituted for the department
                insofar as dealings with PRIDE. This clause is not applicable to
                any subcontractors, unless otherwise required by law. An
                abbreviated list of products/services available from PRIDE may
                be obtained by contacting PRIDE'S Tallahassee branch office at
                (850) 487-3774 or SunCom 277-3774.

        2.      Procurement of Products or Materials with Recycled Content

                Additionally, it is expressly understood and agreed that any
                products or materials which are the subject of, or are required
                to carry out this contract shall be procured in accordance with
                the provisions of section 403.7065 and 287.045, Florida
                Statutes.

        3.      Equity in Contracting

                Pursuant to Section 287.09451, F.S., and in compliance with the
                governor's One Florida Initiative, Executive Order 99-281, the
                department is committed to embracing diversity and providing
                fair and equal opportunities to all qualified businesses to
                compete for state contracts, so that vendors for procurement of
                goods and services reflect the diversity of the state's
                population. The department requests a report monthly
                demonstrating university in the provider's selection of vendors
                for procurement of goods and services.

Q.      CIVIL RIGHTS REQUIREMENTS

        1.      To give this assurance in consideration of and for the purpose
                of obtaining federal grants, loans, contracts (except contracts
                of insurance or guaranty), property, discounts, or other federal
                financial assistance to programs or activities receiving or
                benefiting from federal financial assistance. The Contractor
                agrees to complete the Civil Rights Compliance Questionnaire,
                DOEA Form 101 A and B, if services are provided to clients and
                if fifteen (15) or more persons are employed.

                        ensure  that it will comply with:

                                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.

                                   Page 3 of 7

<PAGE>

                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, 20 U.S.C. 1681 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. 9849, 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, 42 USC,
                        12101, et.seq., which prohibits discrimination on the
                        basis of disability and requires reasonable
                        accommodations.

                g.      All regulations, guidelines, and standards as are now or
                        may be lawfully adopted under the above statutes.

        3.      To establish procedures to handle complaints of discrimination
                involving services or benefits through this contract related to
                employment and labor issues. The contractor shall advise
                clients, employees, and participants of the right to file a
                complaint, the right to appeal a denial or exclusion from the
                services or benefits from this contract, and their right to a
                fair hearing. Complaints of discrimination involving services or
                benefits through this contract may also be filed with the
                Secretary of the department or the appropriate federal or state
                agency.

        4.      That compliance with this assurance is a condition of continued
                receipt of or benefit from federal financial assistance, and
                that it is binding upon the Contractor, its successors,
                transferees, and assignees for the period during which such
                assistance is provided. The Contractor further assures that all
                contractors, subcontractors, sub-grantees, or others with whom
                it arranges to provide services or benefits to participants or
                employees in connection with any of its programs and activities
                are not discriminating against those participants or employees
                in violation of the above statutes, regulations, guidelines, and
                standards. In the event of failure to comply, the Contractor
                understands that the department, at its discretion, seeks a
                court order requiring compliance with the terms of this
                assurance or seeks other appropriate judicial or administrative
                relief, including but not limited to, termination of and denial
                of further assistance.

R.      REQUIREMENTS OF SECTION 287.058, FLORIDA STATUTES

                To submit bills for fees or other compensation for service or
                expenses in sufficient detail for a proper pre-audit and
                post-audit thereof.

        2.      Where applicable, to submit bills for any travel expenses in
                accordance with section 112.061, Florida Statutes.

                To provide units of deliverables, including reports, findings,
                and drafts as specified in this contract to be received and
                accepted by the contract manager prior to payment.

        4.      To comply with the criteria and final date by which such
                criteria must be met for completion of this contract as
                specified in section III, paragraph A-2 of this contract.

        5.      To allow public access to all documents, papers, letters, or
                other materials subject to the provisions of Chapter 119,
                Florida Statutes, and made or received by the Contractor in
                conjunction with this contract. It is expressly understood that
                substantial evidence of the Contractor's refusal to comply with
                this provision shall constitute a breach of contract.

S.      WITHHOLDINGS AND OTHER BENEFITS

                To be responsible for Social Security and Income Tax
                withholdings.

        2.      To not be entitled to state retirement or leave benefits except
                where the Contractor is a state agency.

        3.      Unless justified by the Contractor and agreed to by the
                department in Attachment N/A, section N/A the department will
                not furnish services of support (e.g., office space, office
                supplies, telephone service, secretarial, or clerical support)
                normally available to career service employees.

T.      SPONSORSHIP

        1.      As required by section 286.25, Florida Statutes, if the
                Contractor is a non-governmental organization which sponsors a
                program financed wholly or in part by state funds, including any
                funds obtained through this contract, it shall, in publicizing,
                advertising or describing the sponsorship of the program state:
                "Sponsored by: Physicians Healthcare Plans, Inc. and the State
                of Florida Department of Elder Affairs and the Agency For Health
                Care Administration." If the sponsorship reference is in written
                material, the words "State of Florida, Department of Elder
                Affairs and the Agency For Health Care Administration" shall
                appear in the same size letters and type as the name of the
                organization. This shall include, but is not limited to, any
                correspondence or other writing, publication or broadcast that
                refers to such program.

        2.      If the contractor is a governmental entity or political
                subdivision of the state, the department requests compliance
                with the conditions specified in the above paragraph.

        3.      To not use the words "The State of Florida Department of Elder
                Affairs" or "The Agency for Health Care Administration" to
                indicate sponsorship of a program otherwise financed unless
                specific authorization has been obtained by the department prior
                to use.

U.      FINAL INVOICE

        To submit the final invoice for payment to the agency no more than 90
        days after the contract ends or is terminated; if the Contractor fails
        to do so, all right to payment is forfeited and the agency will not
        honor any requests submitted after the aforesaid time period. Any
        payment due under the terms of this contract may be withheld until all
        reports due from the Contractor and necessary adjustments thereto have
        been approved by the agency.

V.      USE OF FUNDS FOR LOBBYING PROHIBITED

        To comply with the provisions of section 216.347, Florida Statutes,
        which prohibits the expenditure of contract funds for the purpose of
        lobbying the Legislature, a judicial branch or a state agency.

                                   Page 4 of 7

<PAGE>

W.      PUBLIC ENTITY CRIME

        Denial or revocation of the right to transact business with public
        entities. It is the intent of the legislature to place the following
        restrictions on the ability of persons convicted of public entity crimes
        to transact business with the department or agency per section 287.133,
        Florida Statutes:

        A person or affiliate who has been placed on the convicted vendor list
        following a conviction for a public entity crime may not submit a bid on
        a contract to provide any goods or services to a public entity, may not
        submit a bid on a contract with a public entity for the construction or
        repair of a public building or public work, may not submit bids on
        leases of real property to a public entity, may not be awarded or
        perform work as a contractor, supplier, subcontractor, or consultant
        under a contract with any public entity, and may not transact business
        with any public entity in excess of the threshold amount provided in s.
        287.017 for CATEGORY TWO for a period of 36 months form the date of
        being placed on the convicted vendor list.

X.      CONFLICT OF INTEREST

        The Contractor hereby agrees that it will ensure that its employees,
        board members, management and subcontractors, will avoid any conflict of
        interest or the appearance of a conflict of interest when disbursing or
        using the funds described in this agreement or when contracting with
        another entity which will be paid by the funds described in this
        agreement. A conflict of interest includes but is not limited to
        receiving, or agreeing to receive, a direct or indirect benefit, or
        anything of value from a provider, client, subcontractor, or any person
        wishing to benefit from the use or disbursement of these funds. To avoid
        conflict of interest a Contractor must ensure that all individuals make
        a disclosure to the department of any relationship which may be, or may
        be perceived to be as a conflict of interest within thirty (30) days of
        an individual's original appointment or placement on a board, or if the
        individual is serving as an incumbent, within days of the commencement
        of the contract.

Y.      SUCCESSORS AND TRANSFEREES

        This contract and its attachments are binding on the recipient and its
        successors and transferees.

II.     THE DEPARTMENT AND AGENCY AGREE:

A.      CONTRACT AMOUNT

        To pay for contracted services according to the conditions of this
        contract in an amount not to exceed $ 10,350,926.00 subject to the
        availability of funds. The State of Florida's performance and obligation
        to pay under this contract is contingent upon an annual appropriation by
        the Legislature. The costs of services paid under any other contract or
        from any other source are not eligible for reimbursement under this
        contract.

B.      CONTRACT PAYMENT

        Pursuant to Section 215.422. Florida Statutes, agencies shall take no
        longer than 5 working days to inspect and approve goods and services,
        unless bid specifications or the contract specifies otherwise. With the
        exception of payments to health care contractors for hospital, medical,
        or other health care services, if payment is not available within 40
        days, measured from the latter of the date the invoice is received or
        the goods or services are received, inspected and approved, a separate
        interest penalty set by the Comptroller pursuant to Section 55.03,
        Florida Statutes, will be due and payable in addition to the invoice
        amount. Payments to health care contractors for hospitals, medical or
        other health care services, shall be made not more than 35 days from the
        date eligibility for payment is determined, and the interest penalty is
        set by Subsection 215.422(13). Florida Statutes. Invoices returned to a
        vendor due to preparation errors will result in a payment delay. Invoice
        payment requirements do not start until a properly completed invoice is
        provided to the agency.

        A Vendor Ombudsman has been established within the Department of Banking
        and Finance. The duties of this individual include acting as an advocate
        for vendors who may be experiencing problems in obtaining timely
        payment(s) from a state agency. The Vendor Ombudsman may be contacted at
        (850) 488-2924 or by calling the State Comptroller's Hotline,
        1-800-848-3792.

III.    THE CONTRACTOR, DEPARTMENT AND AGENCY MUTUALLY AGREE:

A.      EFFECTIVE DATE

                This contract shall begin on July 1, 2002 or the date on which
                all parties have signed the contract, whichever is later.

        2.      This contract shall end on June 30, 2003.

B.      TERMINATION

                TERMINATION AT WILL

                This contract may be terminated by a party upon no less than
                sixty days (60) calendar days notice, without cause, unless a
                lesser time is mutually agreed upon by all parties. Said notice
                shall be delivered by certified mail, return receipt requested,
                or in person with proof of delivery. In the event the provider
                terminates a contract at will the provider agrees to submit, at
                the time it serves notice of intent to terminate, a plan which
                identifies procedures to ensure services to clients will not be
                interrupted or suspended by the termination.

        2.      TERMINATION BECAUSE OF LACK OF FUNDS

                In the event funds to finance this contract become unavailable
                due to lack of allocation of funds by the Administration
                Commission or the Legislature, the agency will notify the
                Contractor in writing within twenty-four (24) hours after the
                agency learns of such unavailability of funds. Said notice shall
                be delivered by certified mail, return receipt requested, or in
                person with proof of delivery. In the event of a fiscal
                emergency of the State of Florida as determined by the
                Administration Commission or the Legislature, the department, in
                consultation with the agency may terminate the contract no less
                than twenty-four (24) hours after the contractor has received
                written notice. The agency shall be the final authority as to
                the availability of funds.

        3.      TERMINATION FOR BREACH

                Unless the Contractor's breach is waived by the department in
                writing, or the provider fails to cure the breach within the
                time specified by the department, the department may, by written
                notice to the Contractor, terminate this contract or breach if
                the provider fails to cure such breach within thirty

                                   Page 5 of 7

<PAGE>

                (30) days after the Contractor receives from the department
                written notification explaining the nature of the material
                breach; provided however, the department may terminate this
                contract for material breach upon no less than twenty four (24)
                hours written notice to the Contractor if the Contractor has
                committed a material breach of the contract which causes an
                immediate danger to the public health and if the Contractor has
                not cured such breach within the notice period upon no less than
                twenty-four (24) hours notice. Said notice shall be delivered by
                certified mail, return receipt requested, or in person with
                proof of delivery. If applicable, the department may employ the
                default provisions in Chapter 60A-1.006(3). Florida
                Administrative Code.

                If the Contractor does not receive all or a substantial portion
                of its capitation payment within (10) days after it is due. the
                Contractor shall furnish written notification to the department
                and the Contractor may terminate this contract if the agency
                fails to make payment within twenty (20) days after the
                department's receipt of such notice.

                Waiver of breach of any provisions of this contract shall not be
                deemed to be a waiver of any other breach and shall not be
                construed to be a modification of the terms of this contract.
                The provisions herein do not limit the department's or agency's
                right to remedies at law or to damages of legal or equitable
                nature.

C.      SUSPENSION

                The department may, for reasonable cause, temporarily suspend
                the use of funds by a Contractor pending corrective action, or
                pending a decision on terminating the contract. Reasonable cause
                is such cause as would compel a reasonable person to suspend the
                use of funds pursuant to this contract: it includes, but is not
                limited to. the Contractor's failure to permit inspection of
                records, or to provide reports, or to rectify deficiencies noted
                by the department within the time specified by the department,
                or to utilize funds as agreed in this contract, or such other
                cause as might constitute breach of any of the terms of this
                contract.

        2.      The department may prohibit the Contractor from receiving
                further payments and may prohibit the Contractor from incurring
                additional obligations of funds. The suspension may apply to any
                part, or to all of the Contractor's operations

        3.      To suspend operations of the Contractor, the department will
                notify the Contractor in writing by Certified Mail of the action
                taken, the reason(s) for such action: and the conditions of the
                suspension. The notification will also indicate what corrective
                actions are necessary to remove the suspension: the Contractor's
                right to a review of the department's decision and give the
                Contractor the appropriate time period to request a review
                before the effective date of the suspension (unless Contractor
                actions warrant an immediate suspension).

D.      NOTICE AND CONTACT

                The name, address and telephone number of the contract manager
                for the department:

                Anne Frost
                Department of Elder Affairs
                4040 Esplanade Way
                Tallahassee, Florida 32399
                (850) 414-2308

        2.      The name, address and telephone number of the representative for
                the agency:

                Susan Kaempfer
                Agency for Health Care Administration
                2727 Mahan Drive
                Mail Stop 20
                Tallahassee, Florida 32308
                (850)487-2618

        3.      The name, address and telephone number of the representative of
                the Contractor responsible for administration of the program
                under this contract is:

                JoAnne Dutcher. Director
                Physicians Healthcare Plans, Inc.
                398 West Camino Gardens Boulevard, Suite 109
                Boca Raton, Florida 33432
                (561) 750-8866 ext. 2222

        4.      If different representatives are designated after execution of
                this contract, notice of the new representative will be rendered
                in writing to the other parties and attached to the originals of
                this contract.

E.      RENEGOTIATION OR MODIFICATION

                Modifications of provisions of this contract shall only be valid
                when they have been reduced to writing and duly signed. The
                parties agree to renegotiate this contract if federal and/or
                state revisions of any applicable laws, or regulations make
                changes in this contract necessary.

        2.      The rate of payment and the total dollar amount may be adjusted
                retroactively to reflect price level increases and changes in
                the rate of payment when these have been established through the
                appropriations process and subsequently identified in the
                agency's operating budget.

F.      NAME, MAILING AND STREET ADDRESS OF PAYEE

                The name (Contractor name as shown on page 1 of this contract)
                and mailing address of the official payee to whom the payment
                shall be made:

                Physicians Healthcare Plans, Inc.
                1410 North Westshore Boulevard, Suite 200
                Tampa, Florida 33607

                The name of the contact person and street address where
                financial and administrative records are maintained:

                Peter Jimenez
                Physicians Healthcare Plans, Inc.
                55, Alahambra Plaza, 7th Floor
                Coral Gables, Florida 33134

G.      ALL TERMS AND CONDITIONS INCLUDED

        This contract and Attachments I, II, III, IV, V, and VI as referenced,
        contain all terms and conditions agreed upon by the parties.

                                   Page 6 of 7

<PAGE>

IN WITNESS THEREOF, the parties hereto have caused this seven (7) page contract
to be executed by their undersigned officials as duly authorized.

CONTRACTOR: Physicians Healthcare         STATE OF FLORIDA, DEPARTMENT OF ELDER
Plans, Inc.                               AFFAIRS

SIGNED BY: /s/ Miguel B. Fernandez        SIGNED BY: /s/ Terry F. White
           -----------------------                   ---------------------------
NAME:      Miguel B. Fernandez            NAME:      Terry F. White
           -----------------------

TITLE:     Chief Executive Officer        TITLE:     Secretary
           -----------------------

DATE:      6-25-02                        DATE:      6/27/02
           -----------------------                   ---------------------------

CONTRACTOR FEDERAL ID NUMBER
65-0318864
----------------------------

                                          STATE OF FLORIDA, AGENCY FOR
CONTRACTOR FISCAL YEAR ENDING DATE:       HEALTH CARE ADMINISTRATION
December 31
-----------------------------------
                                          SIGNED BY: /s/ Rhonda M. Medows, M.D.
                                                     ---------------------------
                                          NAME:      Rhonda M. Medows, M.D.

                                          TITLE:     Secretary

                                          DATE:      6/27/02
                                                     ---------------------------

                       CONTRACT IS NOT VALID UNTIL SIGNED
                            AND DATED BY ALL PARTIES

                                   Page 7 of 7

<PAGE>

                                  ATTACHMENT I

                                STATE OF FLORIDA
                           DEPARTMENT OF ELDER AFFAIRS
                      AGENCY FOR HEALTH CARE ADMINISTRATION
                            CONTRACT NO. 2002-2003-02

                              Attachment I- 1 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

DEFINITIONS .................................................................  4
SECTION 1   GENERAL CONTRACT REQUIREMENTS ...................................  8
     1.1    Contractor Qualifications .......................................  8
     1.2    Contract Management .............................................  8
     1.3    Insolvency Protection ...........................................  9
     1.4    Surplus Requirements ............................................ 10
     1.5    Bonds ........................................................... 10
     1.6    Insurance ....................................................... 11
     1.7    Interest and Savings ............................................ 11
     1.8    Third Party Resources ........................................... 11
     1.9    Ownership and Management Disclosure ............................. 12
     1.10   Subcontracts .................................................... 13
     1.11   Independent Provider ............................................ 16
     1.12   Termination ..................................................... 16
     1.13   State Ownership ................................................. 17
     1.14   Damages from Federal Disallowances .............................. 17
     1.15   Offer of Gratuities ............................................. 17
     1.16   Attorneys Fees .................................................. 17
     1.17   Venue or Court of Jurisdiction .................................. 17
     1.18   Assignment ...................................................... 18
     1.19   Force Majeure ................................................... 18
     1.20   Disputes of Appropriate Enrol1ments.............................. 18
     1.21   Misuse of Symbols, Emblems, or Names in Reference to Medicaid ... 19
     1.22   Non-Renewal ..................................................... 19
     1.23   Reporting ....................................................... 19
     1.24   Legal Action Notification ....................................... 19
     1.25   Fiscal Intermediary ............................................. 19
     1.26   Sanctions ....................................................... 19
     1.27   Federal Provisions .............................................. 20
SECTION 2   RECIPIENT ELIGIBILITY TO PARTICIPATE IN THE PROJECT.............. 20
     2.1    Eligibility ..................................................... 20
     2.2    Eligibility Determination ....................................... 20
     2.3    Persons Not Eligible for Enrollment in the Project .............. 20
SECTION 3   MARKETING, CHOICE COUNSELING, ENROLLMENT AND DISENROLLMENT....... 21
     3.1    Marketing/ Choice Counseling .................................... 21
     3.2    Enrollment Procedures ........................................... 21
     3.3    Effective Date of Enrollment .................................... 21
     3.4    Transition Care Planning ........................................ 22
     3.5    Orientation ..................................................... 22
     3.6    Disenrollment ................................................... 23
SECTION 4   SERVICE PROVISIONS............................................... 24
     4.1    General ......................................................... 24
     4.2    Long-Term Care Services ......................................... 25
     4.3    Acute-Care Services ............................................. 28
     4.4    Optional Services ............................................... 29
     4.5    Expanded Services ............................................... 30
     4.6    Minimum Long-Term Care Service Provider Qualifications .......... 30
     4.7    Acute Care Provider Qualifications .............................. 31
     4.8    Availability/Accessibility of Services .......................... 31
     4.9    Staffing Requirements ........................................... 32
     4.10   Integration of Care ............................................. 32
     4.11   Plan of Care .................................................... 33
     4.12   Out of Network Use of Non-Emergency Services .................... 34

                              Attachment I- 2 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

SECTION 5   QUALITY ASSURANCE AND IMPROVEMENT REQUIREMENTS .................. 35
     5.1    General ......................................................... 35
     5.2    Quality Assurance Program ....................................... 35
     5.3    Quality Assurance Committee ..................................... 35
     5.4    Quality of Care Studies ......................................... 36
     5.5    Independent Quality Review ...................................... 36
SECTION 6.  GRIEVANCE PROCEDURES ............................................ 36
SECTION 7   ENROLLEE RECORDS ................................................ 40
SECTION 8   REPORTING REQUIREMENTS .......................................... 40
     8.1    General Requirements ............................................ 40
     8.2    Enrollment, Disenrollment, and Cancellation Report for Payment .. 41
     8.3    Contractor Disenrollment Summary ................................ 42
     8.4    Encounter Data .................................................. 43
     8.5    Grievance Report ................................................ 45
SECTION 9   FINANCIAL REPORTING ............................................. 45
     9.1    General ......................................................... 45
     9.2    Audited Financial Statements .................................... 45
     9.3    Unaudited Quarterly Financial Statements ........................ 46
     9.4    Financial Reporting Template .................................... 46
     9.5    Balance Sheet ................................................... 47
     9.6    Statement of Revenues, Expenses, and Net Worth .................. 50
     9.7    Statement of Changes in Financial Position and Net Worth ........ 53
SECTION 10  PAYMENT ......................................................... 54
     10.1   Payment to Contractor ........................................... 54
     10.2   Capitation Rates ................................................ 55
     10.3   Payment in Full ................................................. 55
     10.4   Capitation Rate Adjustments ..................................... 55
     10.5   Payment Errors .................................................. 55

                               Attachment I- 3 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                                   DEFINITIONS

The following terms as used in this contract, shall be construed and/or
interpreted as follows, unless the context otherwise expressly requires a
different construction and/or interpretation. In the event of a conflict in
language between the definitions, attachments and other sections of the
contract, the language in the core contract shall govern.

ADL - Activities of Daily Living; include, dressing, grooming, bathing, eating,
transferring in and out of bed or a chair, walking, climbing stairs, toileting,
bladder/bowel control, and the wearing and changing of incontinent briefs.

Adverse Determination - Adverse determination means any instance in which
coverage for the requested service is denied, reduced, or terminated. The
contractor's decision to deny, reduce or terminate coverage must be based on the
review of whether an admission, availability of care, continued stay, or other
service required in accordance with this contract meets the contractor's
requirements for medical necessity, appropriateness, health care setting, level
of care, or effectiveness

Agency - State of Florida, Agency for Health Care Administration.

Ancillary Services - Services provided at a hospital include, but are not
limited to, radiology, pathology, neurology, and anesthesiology as specified in
the Hospital Coverage and Limitations Handbook.

Area Agency on Aging - an agency designated by the department to develop and
administer a plan for a comprehensive and coordinated system of services for
older persons.

Benefits - a schedule of medical or social services to be delivered to enrollees
covered under this contract.

CMS - Centers for Medicare and Medicaid Services.

Capitation Rate - the monthly fee paid by the agency to the contractor for each
enrollees enrolled under the contract for the provision of services during the
payment period.

Care Plan - A plan which describes the service needs of each recipient, showing
the projected duration, desired frequency, type of provider furnishing each
service, and scope of the services to be provided.

CARES - Comprehensive Assessment and Review for Long Term Care Services. A
nursing home pre-admission assessment program, which provides a comprehensive,
on-site assessment of individuals seeking admission to a nursing home under a
state assisted program. The program explores all available options to nursing
home placement and recommends, and may facilitate alternative placements for
individuals who are determined able to remain in the community.

CFR - Code of Federal Regulations.

Complaint - Complaint means any expression of dissatisfaction by an enrollee,
including dissatisfaction with the administration, claims practices, or
provision of services, which relates to the quality of care provided by a
provider pursuant to the contractor's contract and which is submitted to the
contractor or to a state agency. A complaint is part of the informal steps of a
grievance procedure and is not part of the formal steps of a grievance procedure
unless it is a grievance.

Complainant - a person who has filed a complaint regarding the contractor
pursuant to Section 641.47(5), Florida Statutes, as amended by Chapter 97-159
Laws of Florida.

Contractor - the organizational entity serving as the primary contractor and
with whom this agreement is executed. The term contractor shall include all
employees, subcontractors, agents, volunteers, and anyone acting on behalf of,
in the interest of, or for a contractor.

Covered Services - see Benefits.

Department - Department of Elder Affairs.

DHHS - United States Department of Health and Human Services.

Disenrollment - the discontinuance of an enrollee's membership in the
contractor's plan.

                              Attachment I- 4 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

Durable Medical Equipment - medical equipment that can withstand repeated use;
is primarily and customarily used to serve a medical purpose; is generally not
useful in the absence of illness or injury; and is appropriate for use in the
recipient's home.

Enrollee - a Medicaid recipient who is enrolled in the contractor's Long Term
Care Community Diversion Program.

Enrollment - the process by which an eligible Medicaid recipient becomes an
enrollee in the Long Term Care Community Diversion Program.

Facility - any premises (a) owned, leased, used or operated directly or
indirectly by or for the contractor or its affiliates for purposes related to
this contract; or (b) maintained by a subcontractor to provide services on
behalf of the contractor.

Fair Hearing - the opportunity to present one's case to a reviewing authority in
accordance with the terms and conditions in 42 CFR Part 431, State Organization
and General Administration, Subpart E, and 59G-1.030, Florida Administrative
Code.

Fiscal Agent - any corporation or other legal entity that has contracted with
the agency to receive, process and adjudicate claims under the Medicaid program.

Furnished - means supplied, given, prescribed, ordered, provided, or directed to
be provided in any manner.

Grievance - means a written complaint submitted by or on behalf of an enrollee
to the contractor or a state agency regarding the availability, coverage for the
delivery, or quality of services required in accordance with this contract. This
also includes a complaint regarding an adverse determination made pursuant to
utilization review; claims payment, handling, or reimbursement for services
required in accordance with this contract; or matters pertaining to the
contractual relationship between an enrollee and the contractor. A grievance
does not include a written complaint submitted by or on behalf of an enrollee
eligible for a grievance and appeals procedure provided by the contractor
pursuant to contract with the federal government under Title XVIII of the Social
Security Act.

Grievance Procedure - a written protocol and procedure, in compliance with
Section 641.511, Florida Statutes, as amended by Chapter 97-159, Laws of
Florida, detailing an organized process by which enrollees or providers may file
a grievance.

Grievant - an enrollee, subcontractor, or other service provider that files a
grievance with the contractor.

HMO - Health Maintenance Organization as certified pursuant to Chapter 641,
Florida Statutes.

Hospital - a facility licensed in accordance with the provisions of Chapter 395,
Florida Statutes, or the applicable laws of the state in which the service is
furnished.

IADL - Instrumental Activities of Daily Living; include making and answering
telephone calls, shopping, transportation ability, preparing meals, laundry,
light housekeeping, heavy chores, taking medication, and managing money.

ICP - The Medicaid Institutional Care Program.

Ineligible Recipient - a Medicaid recipient that does not qualify for enrollment
in the Long Term Care Community Diversion Program.

Insolvency - A financial condition that exists when an entity is unable to pay
its debts as they become due in the usual course of business, or when the
liabilities of the entity exceed its assets.

Lead Agency - means an entity designated by an area agency on aging and given
the authority and responsibility to coordinate services for functionally
impaired elderly persons.

Long-Term Care Record - a record that includes information regarding the medical
and long-term care services an enrollee is receiving including the plan of care
and documentation of case management activities including efforts to coordinate
and integrate the delivery of all services to the enrollee.

                              Attachment I- 5 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

Marketing - any activity conducted by or on behalf of the contractor where
information regarding the services offered by the contractor is disseminated in
order to encourage eligible enrollees to enroll or accept any application for
enrollment in the Long Term Care Community Diversion Program developed under
this contract.

Medicaid - the medical assistance program authorized by Title XIX of the federal
Social Security Act, 42 U.S.C.s.1396 et seq., and regulations there under, as
administered in this state by the agency under Section 409.901 et seq., Florida
Statutes.

Medicaid HMO - an HMO as defined in the Medicaid State Plan.

Medicare - the medical assistance program authorized by Title XVIII of the
federal Social Security Act, 42 U.S.C.s. 1395 et seq., and regulations there
under.

Nursing Facility - an institutional care facility licensed under Chapter 395,
Florida Statutes, or Chapter 400, Florida Statutes, that furnishes medical or
allied inpatient care and services to individuals needing such services.

Other Qualified Provider - a contracted provider who meets the qualifications of
Section 430.703(7), Florida Statutes.

Outpatient - a patient of an organized medical facility or distinct part of that
facility who is expected by the facility to receive and who does receive
professional services for less than a 24-hour period regardless of the hour of
admission, whether or not a bed is used, or whether or not the patient remains
in the facility past midnight.

Peer Review - an evaluation of the professional practices of a provider by peers
of the provider in order to assess the necessity, appropriateness, and quality
of care furnished as such care is compared to that customarily furnished by the
provider's peers and to recognized health care standards.

Plan of Care - See Care Plan.

Prepaid Health Plan or Plan - the prepaid health care plan developed by the
contractor in performance of its duties and responsibilities under this
contract; or a contractual arrangement between the agency and a comprehensive
health care contractor for the provision of Medicaid care, goods, or services on
a prepaid basis to Medicaid recipients.

Primary Care Physician - a Medicaid-participating or prepaid health
plan-affiliated physician practicing as a general or family practitioner,
internist, pediatrician, obstetrician, gynecologist, or other specialty approved
by the agency, who furnishes primary care and patient management services to an
enrollee.

Prior Authorization - the act of authorizing specific services before they are
rendered.

Project - Long Term Care Community Diversion Program.

Protocols - written guidelines or documentation outlining steps to be followed
for handling a particular situation, resolving a problem, or implementing a plan
of medical, social, nursing, psycho social, developmental and educational
services.

Provider - a person or entity who is responsible for or directly provides any
medical or social services authorized by this contract.

Provider Handbook - a document that provides information to a Medicaid provider
regarding enrollee eligibility, claims submission and processing, provider
participation, covered care, goods, or services and limitations, procedure codes
and fees, and other matters related to Medicaid program participation.

Quality Assurance - the process of assuring that the delivery of health care is
appropriate, timely, accessible, available, and medically necessary.

                              Attachment I- 6 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

Recipient - any individual whom the Department of Children and Families
determines is eligible, pursuant to federal and state law, to receive medical or
allied care, goods, or services for which the agency may make payments under the
Medicaid program and is enrolled in the Medicaid program.

Risk - the potential for loss that is assumed by an entity and that may arise
because the cost of providing care, goods, or services may exceed the capitation
or other payment made by the agency to the plan under terms of the contract.

Service Area - the designated geographical area within which the contractor is
authorized by contract to furnish covered services to enrollees and within which
the enrollees reside.

State - State of Florida.

Subcontract - an agreement entered into by a contractor for the provision of
benefits to enrollees or to perform any administrative function or service for
the contractor specifically related to securing or fulfilling the contractor's
obligations under this contract. Subcontracts include, but are not limited to
the following: agreements with all providers of medical or ancillary services,
unless directly employed by the contractor; management or administrative
agreements; third party billing or other indirect administrative/fiscal
services, including provision of mailing lists or direct mail services; and any
contract which benefits any person with a control interest in the contractor's
organization.

Subcontractor - any person to which the contractor has contracted or delegated
some of its functions, services or its obligations under this contract.

Surplus - Net worth, i.e., total assets minus total liabilities.

Third Party Resources - an individual, entity, or program, excluding Medicaid,
that is, may be, could be, should be, or has been liable for all or part of the
cost of medical services related to any medical assistance covered by Medicaid.
An example is an individual's auto insurance company, which typically provides
payment of some medical expenses related to automobile accidents and injuries.

Transportation - an appropriate means of conveyance furnished to an enrollee to
obtain services authorized under this contract.

Transition Care Services - services necessary in order to safely maintain a
person in the community both prior to and after the effective date of their
enrollment in the project until the initial Plan of Care is implemented.

Transition Period - the period of time from the effective date of enrollment
until the initial Plan of Care is effective.

Urgent Grievance - an adverse determination when the standard timeframe of the
grievance procedure would seriously jeopardize the life or health of an
enrollee, or the enrollee's ability to regain maximum function.

Violation - each determination by the department and/or agency that a contractor
failed to act as specified in the contract or in applicable statutes or rules
governing Medicaid prepaid health plans. Each day that an ongoing violation
continues may be considered for the purposes of this contract to be a separate
violation. In addition, each instance of failing to furnish necessary and/or
required services or items to enrollees is considered for purposes of this
contract to be a separate violation.

                              Attachment I- 7 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

          LONG-TERM CARE COMMUNITY DIVERSION PILOT PROJECT REQUIREMENTS

SECTION  GENERAL CONTRACT REQUIREMENTS

        CONTRACTOR QUALIFICATIONS

        To qualify as a long-term care community diversion program contractor,
        the contractor must:
        A.      Have a certificate of authority from the Florida Department of
                Insurance to operate as a health maintenance organization (HMO)
                pursuant to Chapter 641 Part I, Florida Statutes, and have a
                health care provider certificate from the Agency for Health Care
                Administration (agency) pursuant to Chapter 641.49, Florida
                Statutes, for those counties in the service area in which the
                applicant will apply to provide services or;
        B.      Have a license issued pursuant to Chapter 400, Florida Statutes,
                and meet the provisions of an "other qualified provider" set
                forth in Section 430.703(7), Florida Statutes, including
                satisfying all financial and quality assurance requirements for
                a provider service network as specified in Section 409.912,
                Florida Statutes, and;
        C.      Have, or have a subcontractor that has, prior experience in
                providing home and community-based long-term care services in
                the project service area and;
        D.      Have the capacity to integrate the delivery of acute and
                long-term care services to enrollees; and
        E.      Meet all the requirements to enroll as a Medicaid prepaid health
                services provider; and
        F.      Meet all other requirements in the remaining provisions of this
                contract and its attachments.

1.2     CONTRACT MANAGEMENT

        A.      STATE RESPONSIBILITIES
                1.      The Department of Elder Affairs (department) and the
                        Agency for Health Care Administration (agency) will
                        share contract management responsibilities for the
                        project. General responsibilities of the department and
                        agency are outlined in this subsection. The Area Agency
                        on Aging in the project service area may also be
                        designated to serve as an agent of the department in
                        executing contract management responsibilities. The
                        department will have the right to approve, disapprove,
                        or require modification of procedures developed by the
                        contractor under the contract where necessary to assure
                        compliance with department or agency rules or the
                        contract.
        B.      DEPARTMENT RESPONSIBILITIES
                1.      Develop, analyze and revise policies and procedures for
                        the project in consultation with the agency.
                2.      Approve, in consultation with the agency, the
                        contractor's readiness to deliver services under the
                        contract.
                3.      Determine the clinical eligibility of persons applying
                        for Medicaid long-term care assistance through the
                        Comprehensive Assessment and Review for Long-Term Care
                        Services (CARES) program.
                4.      Provide, through the CARES program, information
                        regarding long-term care options to persons applying for
                        Medicaid long-term care assistance.
                5.      Provide policy clarification and contract clarification,
                        in consultation with the agency, as requested by the
                        contractor.
                6.      Monitor, with the agency, the contractor's compliance
                        with the terms of the contract and impose appropriate
                        corrective and remedial measures as warranted.
                7.      Analyze and monitor data provided by the contractor
                        pursuant to the terms of the contract.
                8.      Receive all materials that must be submitted by the
                        contractor and forward them to the appropriate entity.

                              Attachment I- 8 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                9.      Oversee the daily operations of the project in terms of
                        enrollment and payments to the contractor.
                10.     Serve as the liaison between the contractor and the
                        agency.
        C.      AGENCY RESPONSIBILITIES
                1.      Calculate capitation payment rates for the services
                        included in the contract.
                2.      Make Medicaid provider handbooks available to the
                        contractor.
                3.      Provide policy and contract clarification, in
                        consultation with the department, as requested by the
                        contractor.
                4.      Monitor, with the department, the contractor's
                        compliance with the terms of the contract and impose
                        appropriate corrective and remedial measures as
                        warranted.
                5.      Make Medicaid capitation payments to the contractor
                        through the Medicaid fiscal agent.
                6.      Oversee all the activities of the Medicaid fiscal agent
                        related to the project.
                7.      Serve as a liaison between the contractor and the
                        Medicaid fiscal agent.
                8.      Approve, in consultation with the department, the
                        contractor's readiness to deliver services under the
                        contract.
                9.      Approve, in consultation with the department, all
                        consumer information materials developed by the
                        contractor for use in the project.
                10.     Serve as the liaison between the department and the
                        Medicaid Fiscal Agent.
        D.      CONTRACTOR RESPONSIBILITIES
                1.      The contractor is responsible for the administration and
                        management of all contractor functions, including all
                        subcontracts, employees, agents and anyone acting for or
                        on behalf of the contractor.
                2.      The contractor will not interpret general Medicaid
                        policy. When interpretations are required, the
                        contractor must submit written requests to the contract
                        manager. The contract manager will contact the
                        appropriate agencies in responding to the request.
                3.      If the contractor delegates administrative and
                        management functions to a third party administrator
                        (TPA), the TPA must be licensed to do business as a TPA
                        in Florida. Such delegation to a TPA does not relieve
                        the contractor of responsibility for the administration
                        and management required under this contract.
                4.      The relationship between management personnel and the
                        governing body must be set forth in writing, including
                        each person's authority, responsibilities and function.
                5.      The contractor must develop and maintain written
                        policies and procedures to implement the provisions of
                        the contract.
                6.      The contractor must agree to the responsibilities and to
                        the performance of all services as set forth in all
                        provisions of this contract and its attachments.

1.3     INSOLVENCY PROTECTION

        A.      The contractor must establish a restricted insolvency protection
                account with a federally guaranteed financial institution
                licensed to do business in Florida in accordance with Section
                1903(m)(1) of the Social Security Act (amended by Section 4706
                of the Balanced Budget Act of 1997), and Section 409.912(15)(a),
                Florida Statutes. The contractor must deposit into that account
                five percent of the capitation payments made by the agency each
                month until a maximum total of two percent of the annualized
                total current contract amount is reached. No interest may be
                withdrawn from this account until the minimum balance of 2% of
                the contract annual amount is reached. Withdrawals from the
                account may not cause the balance therein to fall below the 2%
                of annual contract amount minimum. This provision will remain in
                effect as long as the contractor continues to contract with the
                department and agency. The restricted insolvency protection
                account may be drawn upon with the authorized signatures of two
                persons designated by the contractor, one person designated by
                the agency, and one person designated by the department. The
                signature card must be resubmitted when a change in authorized
                personnel occurs. If the authorized persons remain the same, the
                contractor must submit an attestation to this effect annually.
                All such agreements or other signature cards must be approved in
                advance by the agency. Upon request, a

                              Attachment I- 9 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                sample form (Multiple Signature Verification Agreement) will be
                supplied by the department.
        B.      In the event that a determination is made by the agency, in
                consultation with the department, that the contractor is
                insolvent, as defined in the glossary, the agency may draw upon
                the amount solely with the two authorized signatures of
                representatives of the department and agency and funds may be
                disbursed to meet financial obligations incurred by the
                contractor under this contract. The contractor shall provide a
                statement of account balance within 15 calendar days of request
                by the agency.
        C.      If the contract is terminated, expired, or not continued, the
                account balance shall be released by the agency to the
                contractor upon receipt of proof of satisfaction of all
                outstanding obligations incurred under this contract.
        D.      In the event the contract is terminated or not renewed and the
                contractor is insolvent, the agency may draw upon the insolvency
                protection account to pay any outstanding debts the contractor
                owes the agency including, but not limited to, overpayments made
                to the contractor, and fines imposed under the contract or
                Section 641.52, Florida Statutes, for which a final order has
                been issued. In addition, if the contract is terminated or not
                renewed and the contractor is unable to pay all of its
                outstanding debts to health care providers, the department,
                agency and the contractor agree to the court appointment of an
                impartial receiver for the purpose of administering and
                distributing the funds contained in the insolvency protection
                account. Should a receiver be appointed, he must give
                outstanding debts owed to the agency priority over other claims.
        E.      Pursuant to Section 409.912(15)(b), Florida Statutes, the
                department, in consultation with the agency may waive the
                insolvency protection account requirement, in writing, when
                evidence of adequate insolvency insurance and reinsurance are on
                file with the agency which will protect enrollees in the event
                the contractor is unable to meet its obligations.

1.4     SURPLUS REQUIREMENTS

        A.      All new contractors, after initial contract execution but prior
                to initial member enrollment, must submit to the department, if
                a private entity, proof of working capital in the form of cash
                or liquid assets excluding revenues from Medicaid premium
                payments equal to at least the first three months of operating
                expenses or $200,000, whichever is greater. This provision shall
                not apply to contractors who have been providing services to
                members for a period exceeding three continuous months.
        B.      In accordance with Section 409.912(14), Florida Statutes, the
                contractor must maintain at all times in the form of cash,
                investments that mature in less than 180 calendar days allowable
                as admitted assets by the Department of Insurance, and
                restricted funds of deposits controlled by the agency (including
                the plan's insolvency protection account) or the Department of
                Insurance, a surplus amount equal to one and one half times the
                contractor's monthly Medicaid prepaid revenues. In the event
                that the contractor's surplus (as defined in the glossary) falls
                below an amount equal to one and one half times the contractor's
                monthly Medicaid prepaid revenues, the department will cease the
                contractor's enrollment authorizations until the required
                balance is achieved, or may terminate the contract.

1.5     BONDS

        A.      The contractor must secure and maintain during the life of the
                contract a blanket fidelity bond from a company doing business
                in the State of Florida on all personnel in its employment and
                its board of directors. The bond must be issued in the amount of
                at least $250,000 per occurrence. Said bond must protect the
                department and agency from any losses sustained through any
                fraudulent or dishonest act or acts committed by any employees
                of the provider and subcontractors, if any. The contractor must
                submit proof of coverage within 60 calendar days after execution
                of the contract and prior to the

                              Attachment I- 10 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                delivery of services. For fidelity bonds to be acceptable, a
                surety company must comply with the provisions of Chapter 624,
                Florida Statutes. The contractor must submit proof of the
                fidelity bond annually during the contract renewal period.
        B.      A contractor applying as an "other qualified provider" set forth
                in Section 430.703(7), Florida Statutes, must secure and
                maintain, during the life of the contract, a performance bond
                from a company doing business in the State of Florida. The bond
                must guarantee the contractor's performance and obligations in
                accordance with the terms, conditions and agreements in this
                contract and be issued in the amount of $500,000.

1.6     INSURANCE

        A.      The contractor must obtain and maintain, at all times, adequate
                insurance coverage including general liability insurance,
                professional liability and malpractice insurance, fire and
                property insurance, and director's omission and error insurance.
                All insurance coverage must comply with the provisions set forth
                in Section 4-191.069, Florida Administrative Code, except that
                the reporting, administrative, and approval requirements will be
                submitted to the department in addition to the Department of
                Insurance. All insurance policies must be written by insurers
                licensed to do business in the State of Florida and be in good
                standing with the Department of Insurance. The contractor must
                submit all policy declaration pages annually or whenever there
                is a change in insurer or policy provisions to the contract
                manager. Each certificate of insurance must provide for
                notification to the department in the event of termination of
                the policy.
        B.      The contractor must secure and maintain during the life of the
                contract, worker's compensation insurance for all of its
                employees connected with the work under the contract. Such
                insurance must comply with the Florida Worker's Compensation
                Law, Chapter 440, and Florida Statutes. Policy declaration pages
                must be submitted to the department annually.

1.7     INTEREST AND SAVINGS

        A.      Interest generated through investments made by the contractor of
                funds provided to the contractor pursuant to this contract will
                be the property of the contractor and will be used at the
                contractor's discretion.
        B.      The contractor will retain any savings realized under the
                contract after all bills, charges, and fines are paid.

1.8     THIRD PARTY RESOURCES

        A.      The contractor will be responsible for making every reasonable
                effort to determine the legal liability of third parties to pay
                for services rendered to enrollees under this contract. The
                contractor has the same rights to recovery of the full value of
                services as the agency. (See Section 409.910, Florida Statutes)
                The following standards govern recovery.
        B.      If the contractor has determined that third party liability
                exists for part or all of the services provided directly by the
                contractor to an enrollee, the contractor must make reasonable
                efforts to recover from third party liable sources the value of
                services rendered.
        C.      If the contractor has determined that third party liability
                exists for part or all of the services provided to an enrollee
                by a subcontractor or referral provider, and the third party is
                reasonably expected to make payment within 120 calendar days,
                the contractor may pay the subcontractor or referral provider
                only the amount, if any, by which the subcontractor's allowable
                claim exceeds the amount of the anticipated third party payment;
                or, the contractor may assume full responsibility for third
                party collections for service provided through the subcontractor
                or referral provider.

                             Attachment I- 11 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        D.      The contractor may not withhold payment for services provided to
                an enrollee if third party liability or the amount of liabilitys
                cannot be determined, or if payment shall not be available
                within a reasonable time, beyond 120 calendar days from the date
                of receipt.
        E.      When both the agency and the contractor have liens against the
                proceeds of a third party resource, the agency shall prorate the
                amount due to Medicaid to satisfy such liens under Section
                409.910, Florida Statutes, between the agency and the
                contractor. This prorated amount shall satisfy both liens in
                full.
        F.      The agency may, at its sole discretion, offer to provide third
                party recovery services to the contractor. If the contractor
                elects to authorize the agency to recover on its behalf, the
                contractor shall be required to provide the necessary data for
                recovery in the format prescribed by the agency. All recoveries,
                less the agency's cost to recover shall be income to the
                contractor. The cost to recover must be expressed as a
                percentage of recoveries and must be fixed at the time the
                contractor elects to authorize the agency to recover on its
                behalf.
        G.      All funds recovered from third parties shall be treated as
                income for the contractor.

1.9     OWNERSHIP AND MANAGEMENT DISCLOSURE

        A.      Federal and state laws require full disclosure of ownership,
                management and control of Medicaid HMOs, including other
                qualified providers. Disclosure must be made on forms prescribed
                by the agency for the areas of ownership and control interest
                (Form HCFACMS 1513), business transactions (42 CFR 455.105),
                public entity crimes (Section 287.133(3)(a), Florida Statutes),
                and debarment and suspension (52 Fed. Reg., pages 20360-20369,
                and Section 4707 of the Balanced Budget Act of 1997). The forms
                are available through the department and are to be submitted to
                the department with the initial application and then resubmitted
                on an annual basis. The contractor must disclose any changes in
                management as soon as those occur. In addition, the contractor
                must submit to the department full disclosure of ownership and
                control of Medicaid HMOs at least 60 calendar days before any
                change in the contractor's ownership or control occurs.
        B.      The following definitions apply to ownership disclosure:
                1.      A person with an ownership interest or control interest
                        means a person or corporation that:
                        a.      Owns, indirectly or directly, 5 percent or more
                                of the contractor's capital or stock, or
                                receives 5 percent or more of its profits;
                        b.      Has an interest in any mortgage, deed of trust,
                                note, or other obligation secured in whole or in
                                part by the contractor or by its property or
                                assets and that interest is equal to or exceeds
                                5 percent of the total property or assets; or
                        c.      Is an officer or director of the contractor if
                                organized as a corporation, or is a partner in
                                the contractor if organized as a partnership.
                2.      The percentage of direct ownership or control is
                        calculated by multiplying the percent of interest that a
                        person owns by the percent of the contractor's assets
                        used to secure the obligation. Thus, if a person owns 10
                        percent of a note secured by 60 percent of the
                        contractor's assets, the person owns 6 percent of the
                        contractor.
                3.      The percent of indirect ownership or control is
                        calculated by multiplying the percentage of ownership in
                        each organization. Thus, if a person owns 10 percent of
                        the stock in a corporation that owns 80 percent of the
                        contractor's stock, the person owns 8 percent of the
                        contractor.
        C.      Changes in management are defined as any change in the
                management control of the contractor. Examples of such changes
                are those listed below or equivalent positions by another title.
                1.      Changes in the Board of Directors or Officers of the
                        contractor, Medical Director, Chief Executive Officer,
                        Administrator, and Chief Financial Officer;
                2.      Changes in the management of the contractor where the
                        contractor has decided to contract out the operation of
                        the contractor to a management corporation. The
                        contractor must disclose such changes in management
                        control and provide a copy of

                             Attachment I- 12 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        the contract agreement to the contract manager for
                        approval at least 60 calendar days prior to the
                        management contract start date.
        D.      In accordance with Section 409.912(29), Florida Statutes, the
                contractor must annually conduct a background check with the
                Florida Department of Law Enforcement on all persons with five
                percent or more ownership interest in the contractor, or who
                have executive management responsibility for the managed care
                plan, or have the ability to exercise effective control of the
                contractor. The contractor must submit information to the
                department for such persons who have a record of illegal conduct
                according to the background check. The department will keep a
                record of all background checks to be available for department
                and agency review upon request.
                1.      In accordance with Section 409.907(8), Florida Statutes,
                        contractors with an initial contract beginning on or
                        after July 1, 1997, must submit, prior to execution of a
                        contract, complete sets of fingerprints of principals of
                        the contractor to the agency for the purpose of
                        conducting a criminal history record check.
                2.      Principals of the contractor are defined in Section
                        409.907(8)(a), Florida Statutes.
        E.      The contractor must submit to the department, within five
                working days, any information on any officer, director, agent,
                managing employee, or owner of stock or beneficial interest in
                excess of five percent of the contractor who has been found
                guilty of, regardless of adjudication, or who entered a plea of
                nolo contendere or guilty to, any of the offenses listed in
                Section 435.03, Florida Statutes.
        F.      In accordance with Section 409.912(8), Florida Statutes, the
                department and agency will not contract with an entity that has
                an officer, director, agent, managing employee, or owner of
                stock or beneficial interest in excess of five percent of the
                contractor, who has committed any of the above listed offenses.
                In order to avoid termination, the contractor must submit a
                corrective action plan, acceptable to the department, that
                ensures such person is divested of all interest and/or control
                and has no role in the operation and management of the
                contractor
        G.      The contract is subject to the provisions of Chapter 112,
                Florida Statutes. The contractor must disclose the name of any
                officer, director, or agent who is an employee of the State of
                Florida, or any of its agencies. Further, the contractor must
                disclose the name  of any state employee who owns, directly or
                indirectly, an interest of five percent or more in the officer's
                firm or any of its branches. The contractor covenants that it
                presently has no interest and shall not acquire any interest,
                direct or indirect, which would conflict in any manner or degree
                with the performance of the services hereunder. The contractor
                further covenants that in the performance of the contract no
                person having any such known interest shall be employed. No
                official or employee of the department or agency and no other
                public official of the State of Florida or the federal
                government who exercises any functions or responsibilities in
                the review or approval of the undertaking of carrying out the
                contract must, prior to completion of this contract, voluntarily
                acquire any personal interest, direct or indirect, in this
                contract or proposed contract.

1.10    SUBCONTRACTS

        The contractor is responsible for all work performed under this
        contract, but may, with the written approval of the department, enter
        into subcontracts for the performance of work required under this
        contract. All subcontracts and amendments executed by the contractor
        must meet the following requirements and all model provider subcontracts
        must be approved, in writing, by the department in advance of
        implementation. All subcontractors must be eligible for participation in
        the Medicaid program; however, the subcontractor is not required to
        participate in the Medicaid program as a provider. Subcontracts are
        required with all major providers of services.

        The contractor must not discriminate with respect to participation,
        reimbursement, or indemnification as to any provider who is acting
        within the scope of the provider's license, or certification under
        applicable state law, solely on the basis of such license, or
        certification, in

                             Attachment I- 13 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        accordance with Section 4704 of the Balanced Budget Act of 1997. This
        paragraph shall not be construed to prohibit a contractor from including
        providers only to the extent necessary to meet the needs of the
        contractor's enrollees or from establishing any measure designed to
        maintain quality and control costs consistent with the responsibilities
        of the organization. No subcontract, which the contractor enters into
        with respect to performance under the contract, shall in any way relieve
        the contractor of any responsibility for the performance of duties under
        this contract. The contractor must assure that all tasks related to the
        subcontract are performed in accordance with the terms of this contract.
        The contractor must identify, in its subcontracts, any aspect of service
        that may be further subcontracted by the subcontractor. All model and
        executed subcontracts and amendments used by the contractor under this
        contract must be in writing, signed, and dated by the contractor and the
        subcontractor and meet the following requirements:

        A.      IDENTIFICATION OF CONDITIONS AND METHOD OF PAYMENT:
                1.      The contractor agrees to make payment to all
                        subcontractors pursuant to Section 641.3155, Florida
                        Statutes. If third party liability exists, payment of
                        claims must be determined in accordance with Section
                        70.201, Third Party Resources.
                2.      Provide for prompt submission of information needed to
                        make payment.
                3.      Make full disclosure of the method and amount of
                        compensation or other consideration to be received from
                        the contractor. The provider must not charge for any
                        service provided to the recipient at a rate in excess of
                        the rates established by the contractor's subcontract
                        with the provider in accordance with Section
                        1128B(d)(l), Social Security Act (enacted by Section
                        4704 of the Balanced Budget Act of 1997).
                4.      Require an adequate record system be maintained for
                        recording services, charges, dates and all other
                        commonly accepted information elements for services
                        rendered to recipients under the contract.
                5.      Physician incentive plans must comply with 42 CFR
                        417.479. The contractor shall make no specific payment
                        directly or indirectly under a physician incentive plan
                        to a physician or physician group an inducement to
                        reduce or limit medically necessary services furnished
                        to an individual enrollee. Incentive plans must not
                        contain provisions that provide incentives, monetary or
                        otherwise, for the withholding of medically necessary
                        care. The contractor must disclose information on
                        provider incentive plans listed in 42 CFR 417.479(h)(1)
                        and 417.479(1) at the times indicated in 42 CFR
                        417.479(d)-(g). All such arrangements must be submitted
                        to the department for approval, in writing, prior to
                        use. If any other type of withhold arrangement currently
                        exists, it must be omitted from all subcontracts.
                6.      Specify whether the contractor will assume full
                        responsibility for third party collections in accordance
                        with Section 70.201, Third Party Resources.
        B.      PROVISIONS FOR MONITORING AND INSPECTIONS:
                1.      Provide that the department, agency and DHHS may
                        evaluate through inspection or other means the quality,
                        appropriateness and timeliness of services performed.
                2.      Provide for inspections of any records pertinent to the
                        contract by the department, agency and DHHS.
                3.      Require that records be maintained for a period not less
                        than five years from the close of the contract and
                        retained further if the records are under review or
                        audit until the review or audit is complete. (Prior
                        approval for the disposition of records must be
                        requested and approved by the provider if the
                        subcontract is continuous.)
                4.      Provide for monitoring and oversight by the contractor
                        and the subcontractor to provide assurance that all
                        licensed medical professionals are credentialed in
                        accordance with the contractor's and the agency's
                        credentialing requirements as found in Section 20.5.1,
                        Credentialing and Re-credentialing Policies and
                        Procedures, if the contractor has delegated the
                        credentialing to a subcontractor.
                5.      Provide for monitoring of services rendered to enrollees
                        sponsored by the provider.
        C.      SPECIFICATION OF FUNCTIONS OF THE SUBCONTRACTOR:
                1.      Identify the population covered by the subcontract.

                             Attachment I- 14 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                2.      Specify the amount, duration and scope of services to be
                        provided by the subcontractor, including a requirement
                        that the subcontractor continue to provide services
                        through the term of the capitation period for which the
                        agency has paid the contractor.
                3.      Provide for timely access to appointments.
                4.      Provide for submission of all reports and clinical
                        information required by the contractor.
                5.      Provide for the participation in any internal and
                        external quality improvement, utilization review, peer
                        review, and grievance procedures established by the
                        contractor.
        D.      PROTECTIVE CLAUSES:
                1.      Require safeguarding of information about enrollees in
                        accordance with 42 CFR, Part 431, Subpart F.
                2.      Require compliance with HIPAA privacy and security
                        provisions.
                3.      Require an exculpatory clause, which survives
                        subcontract termination including breach of subcontract
                        due to insolvency, that assures that enrollees, the
                        department, or agency may not be held liable for any
                        debts of the subcontractor and, in accordance with 42
                        CFR 447.15, that the recipient is not liable to the
                        provider for any services for which the contractor is
                        liable as specified in Section 641.3154, Florida
                        Statutes.
                4.      Contain a clause indemnifying, defending and holding the
                        department, agency, and the contractor's enrollees
                        harmless from and against all claims, damages, causes of
                        action, costs or expense, including court costs and
                        reasonable attorney fees arising from the subcontract
                        agreement. This clause must survive the termination of
                        the subcontract, including breach due to insolvency. The
                        department may waive this requirement for itself, but
                        not the contractor's enrollees, for damages in excess of
                        the statutory cap on damages for public entities if the
                        subcontractor is a public health entity with statutory
                        immunity. All such waivers must be approved in writing
                        by the department.
                5.      Require that the subcontractor secure and maintain
                        during the life of the subcontract worker's compensation
                        insurance for all of its employees connected with the
                        work under this contract unless such employees are
                        covered by the protection afforded by the contractor.
                        Such insurance must comply with the Florida's Worker's
                        Compensation Law.
                6.      Pursuant to Section 641.315(9), Florida Statutes,
                        contain no provision that prohibits a physician from
                        providing inpatient services in a contracted hospital to
                        an enrollee if such services are determined by the
                        organization to be medically necessary and covered
                        services under the organization's contract with the
                        contract holder.
                7.      Contain no provision restricting the provider's ability
                        to communicate information to the provider's patient
                        regarding medical care or treatment options for the
                        patient when the provider deems knowledge of such
                        information by the patient to be in the best interest of
                        the health of the patient.
                8.      Pursuant to Section 641.315(10), contain no provision
                        requiring providers to contract for more than one HMO
                        product or otherwise be excluded.
                9.      Pursuant to Section 641.315(6), Florida Statutes,
                        contain no provision that in any way prohibits or
                        restricts the health care provider from entering into a
                        commercial contract with any other contractor.
                10.     Specify that if the subcontractor delegates or
                        subcontracts any functions of the contractor, that the
                        subcontract or delegation include all the requirements
                        of this section.
                11.     Make provisions for a waiver of those terms of the
                        subcontract that, as they pertain to Medicaid
                        recipients, are in conflict with the specifications of
                        this contract.
                12.     Specify procedures and criteria for extension,
                        renegotiation, and termination, and that the provider
                        must give 60 days' advance written notice to the
                        contractor, and the Department of Insurance before
                        canceling the contract with the contractor for any
                        reason. Nonpayment for goods or services rendered by the
                        provider to the

                             Attachment I- 15 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        contractor is not a valid reason for avoiding the 60 day
                        advance notice of cancellation pursuant to Section
                        641.315(2)(a)2., Florida Statutes. A copy of the notice
                        must be filed simultaneously with the department.

        Pursuant to Section 641.315(2)(b), Florida Statutes, specify that the
        contractor will provide 60 days' advance written notice to the provider
        and the Department of Insurance before canceling, without cause, the
        contract with the provider, except in the case in which a patient's
        health is subject to imminent danger or a physician's ability to
        practice medicine is effectively impaired by an action by the Board of
        Medicine or other governmental agency, in which case notification must
        be provided to the agency immediately. A copy of the notice submitted to
        the Department of Insurance must be filed simultaneously with the
        agency.

        The department may waive this requirement and permit the contractor to
        enter into a letter of agreement with certain facilities, licensed under
        Chapter 400, Part II, Florida Statutes and enrolled in the Medicare and
        Medicaid programs, when it is determined by the department to be in the
        best interest of the enrollee(s) to do so.

1.11    INDEPENDENT PROVIDER

        It is expressly agreed that the contractor and any subcontractors and
        agents, officers, and employees of the contractor or any subcontractors,
        in the performance of this contract shall act in an independent capacity
        and not as officers and employees of the department, agency or the State
        of Florida. It is further expressly agreed that this contract shall not
        be construed as a partnership or joint venture between the contractor or
        any subcontractor and the department, agency or the State of Florida.

1.12    TERMINATION

        A.      In conjunction with Part III section B, titled Termination in
                the core contract, termination procedures are required. The
                party initiating the termination must render written notice of
                termination to the other parties to this agreement by certified
                mail, return receipt requested, or in person with proof of
                delivery, or by facsimile letter followed by certified mail,
                return receipt requested. The notice of termination must specify
                the nature of termination, the extent to which performance of
                work under the contract is terminated, and the date on which
                such termination shall become effective. In accordance with
                1932(e)(4), Social Security Act, the department and agency shall
                provide the contractor with an opportunity for a hearing prior
                to termination for cause.

        B.      Upon receipt of final notice of termination, on the date and to
                the extent specified in the notice of termination, the
                contractor must:
                1.      Stop work under the contract, but not before the
                        termination date.
                2.      Cease enrollment of new enrollees under the contract.
                3.      Assign to the State those subcontracts as directed by
                        the department's and agency's contracting officer
                        including all the rights, title and interest of the
                        contractor for performance of those subcontracts.
                4.      At least 30 calendar days prior to the termination
                        effective date, provide written notification to all
                        enrollees of the following information: the date on
                        which the contractor will no longer participate in the
                        State's Medicaid program; and instructions on contacting
                        the department's CARES office to obtain information on
                        their long-term care options.
                5.      Take such action as may be necessary, or as the
                        department and agency may direct, for the protection of
                        property related to the contract, which is in the
                        possession of the provider, and in which the department
                        and agency have or may acquire an interest.
                6.      Not accept its prepaid payment for any requests for
                        payment submitted after the contract ends. Any payments
                        due under the terms of the contract may be withheld

                             Attachment I- 16 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        until the department receives from the contractor all
                        written and properly executed documents as required by
                        the written instructions of the department.
                7.      Continue to serve or arrange for provision of services
                        to the enrollees enrolled pursuant to the contract on a
                        fee-for-service basis up to 45 days from the
                        notification of termination date.
                8.      In the event the department has terminated this contract
                        in one or more counties of the state, complete the
                        performance of this contract in all other areas in which
                        the contractor has not been terminated.

1.13    STATE OWNERSHIP

        The department and agency will have the right to use, disclose, or
        duplicate, all information and data developed, derived, documented, or
        furnished by the contractor resulting from the contract. Nothing herein
        will entitle the department and agency to disclose to third parties data
        or information which would otherwise be protected from disclosure by
        state or federal law.

        DAMAGES FROM FEDERAL DISALLOWANCES

        In addition to any remedies available through the contract, in law or
        equity, the contractor must reimburse the agency for any federal
        disallowances or sanctions imposed on the department or agency as a
        result of the contractor's failure to abide by the terms of the
        contract.

1.15    OFFER OF GRATUITIES

        By signing this agreement, the contractor signifies that no recipient of
        or a delegate of Congress, nor any elected or appointed official or
        employee of the State of Florida, the General Accounting Office,
        Department of Health and Human Services, Centers for Medicare and
        Medicaid Services, or any other federal department has or will benefit
        financially or materially from this procurement. The department may
        terminate the contract if it is determined that gratuities of any kind
        were offered to or received by any officials or employees from the
        offeror, his agent, or employees.

        ATTORNEYS' FEES

        In the event of a dispute, each party to the contract will be
        responsible for its own attorney's fees except as otherwise provided by
        law.

        VENUE OR COURT OF JURISDICTION

        For purposes of any legal action occurring as a result of or under the
        contract, between the contractor and the department or agency, the place
        of proper venue will be Leon County. The parties expressly agree that:
        A.      The appropriate circuit or county court in Leon County, Florida
                will have jurisdiction of all equitable matters.
        B.      The department will have the discretion to resolve all other
                matters by informal hearing.
        C.      The department will have the sole discretion to remove any case
                to the Division of Administrative Hearings for a formal hearing.
        D.      In the event of concurrent or overlapping jurisdiction, the
                department will determine the proper forum.

                             Attachment I- 17 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

1.18    ASSIGNMENT

        A.      Except as provided below or with the prior written approval of
                the department, which approval will not be unreasonably
                withheld, the contract and the monies which may become due are
                not to be assigned, transferred, pledged or hypothecated in any
                way by the contractor, including by way of an asset or stock
                purchase of the contractor and will not be subject to execution,
                attachment or similar process by the contractor.
        B.      Exceptions for HMOs licensed under Section 641, Florida
                Statutes, are as follows:
                1.      As provided by Section 409.912(17). Florida Statutes,
                        when a merger or acquisition of a contractor has been
                        approved by the Department of Insurance pursuant to
                        Section 628.4615, Florida Statutes, the department shall
                        approve the assignment or transfer of the appropriate
                        Medicaid HMO contract upon the request of the surviving
                        entity of the merger or acquisition if the contractor
                        and the surviving entity have been in good standing with
                        the department and agency for the most recent 12 month
                        period, unless the department determines that the
                        assignment or transfer would be detrimental to the
                        Medicaid recipients or the Medicaid program.
                2.      To be in good standing, a contractor must not have
                        failed accreditation or committed any material violation
                        of the requirements of Section 641.52, Florida Statutes,
                        and must meet the requirements in this contract.
                3.      For the purposes of this section, a merger or
                        acquisition means a change in controlling interest of a
                        contractor, including an asset or stock purchase.

1.19    FORCE MAJEURE

        The department and agency will not be liable for any excess cost to the
        contractor if the department's or agency's failure to perform the
        contract arises out of causes beyond the control and without the result
        of fault or negligence on the part of the department or agency. In all
        cases, the failure to perform must be beyond the control without the
        fault or negligence of the department or agency. The contractor will not
        be liable for performance of the duties and responsibilities of the
        contract when its ability to perform is prevented by causes beyond its
        control. These acts must occur without the fault or negligence of the
        contractor. These include destruction to the facilities due to
        hurricanes, fires, war, riots, and other similar acts. Annually by May
        31, the contractor must submit to the department for approval an
        emergency management plan specifying what actions the contractor must
        conduct to ensure the ongoing provisions of health services in a natural
        disaster or man-made emergency.

1.20    DISPUTES OF APPROPRIATE ENROLLMENTS

        Any disputes arising in and under this contract, including disputes
        relating to the appropriateness of enrollments authorized by CARES staff
        pursuant to section 2.1 of this contract, will be decided by the
        department in consultation with the agency. This provision excludes
        matters brought forth by enrollees. The department must reduce its
        decision to writing and serve a copy on the contractor. The decision of
        the department will be final and conclusive. This contract with numbered
        attachments represents the entire agreement between the contractor, the
        department, and the agency with respect to the subject matter in it and
        supersedes all other contracts between the parties when it is duly
        signed and authorized by the contractor, the department and the agency.
        Correspondence and memoranda of understanding do not constitute part of
        this contract. In the event of a conflict of language between the
        contract and any attachments to the contract, the provisions of the
        contract will govern. However, the department and agency reserve the
        right to clarify any contractual relationship in writing with the
        concurrence of the contractor and such clarification will govern.
        Pending final determination of any dispute, the contractor must proceed
        diligently with the performance of the contract and in accordance with
        the department's direction.

                             Attachment I- 18 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

1.21    Misuse of Symbols, Emblems, or Names in Reference to Medicaid

        No person or contractor may use, in connection with any item
        constituting an advertisement, solicitation, circular, book, pamphlet or
        other communication, or a broadcast, telecast, or other production,
        alone or with other words, letters, symbols or emblems the words
        "Medicaid," or "Department of Elder Affairs," or "Agency for Health Care
        Administration," except as required in the core contract unless prior
        written approval is obtained from the department. Specific written
        authorization from the department is required to reproduce, reprint, or
        distribute any department or agency form, application, or publication,
        for a fee. State and local governments are exempt from this prohibition.
        A disclaimer that accompanies the inappropriate use of the program or
        the department or agency's terms does not provide a defense. Each piece
        of mail or information constitutes a violation.

1.22    NON-RENEWAL

        The contract will be renewed only upon mutual consent of the parties.
        Either party may decline to renew the contract for any reason. The
        parties agree there is no property interest under the contract.

1.23    REPORTING

        The contractor is responsible for complying with all the reporting
        requirements in accordance with the contract. The department will
        provide the contractor with the appropriate reporting formats,
        instructions, submission timetables, and technical assistance when
        required. The department reserves the right to modify the reporting
        requirements to which the contractor must adhere. Failure of the
        contractor to submit the required reports accurately and within the time
        frames specified, may result in the withholding of three (3) percent of
        the next monthly capitation payment by the agency pending receipt of the
        reports.

1.24    LEGAL ACTION NOTIFICATION

        The contractor must give the department by certified mail immediate
        written notification (no later than 30 calendar days after service of
        process) of any action or suit filed or of any claim made against the
        contractor by any subcontractor, vendor, or other party which results in
        litigation related to this contract for disputes or damages exceeding
        the amount of $50,000. In addition, the contractor must immediately
        advise the department of the insolvency of a subcontractor or of the
        filing of a petition in bankruptcy by or against a subcontractor.

1.25    FISCAL INTERMEDIARY

        If the contractor utilizes a fiscal intermediary service organization as
        defined in Section 641.316, Florida Statutes, such organization must be
        licensed to do business as a fiscal intermediary service organization in
        the state of Florida. Such delegation does not relieve the contractor of
        responsibility for the administration and management required under this
        contract.

1.26    SANCTIONS

        A.      In accordance with Section 4707 of the Balanced Budget Act of
                1997, and Section 409.912(19), F.S, the following sanctions may
                be imposed against the contractor if it is determined that the
                contractor has violated any provision of this contract, or the
                applicable statutes or rules governing Medicaid HMOs:
                1.      Suspension of the contractor's enrollment.

                             Attachment I- 19 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                2.      Suspension or revocation of payments to the plan for
                        Medicaid recipients enrolled during the sanction period.
                        If the contractor has violated the contract, the
                        contractor may be ordered to reimburse the complainant
                        for out-of-pocket medically necessary expenses incurred
                        or order the contractor to pay non-network plan
                        providers who provide medically necessary services.
                3.      Imposition of a fine for violation of the contract with
                        the department and agency, pursuant to Section
                        409.912(19), Florida Statutes.
                4.      Termination pursuant to the contract.
        B.      Unless the duration of a sanction is specified, a sanction will
                remain in effect until the department is satisfied that the
                basis for imposing the sanction has been corrected and is not
                likely to recur.

1.27    FEDERAL PROVISIONS

        The contractor is subject to any changes in Federal law, regulations, or
        other policy guidance from the Centers for Medicare and Medicaid
        Services during the term of this contract.

SECTION 2       RECIPIENT ELIGIBILITY TO PARTICIPATE IN THE PROJECT

2.1     ELIGIBILITY

        Recipients eligible for project enrollment must be:
        A.      65 years of age or older.
        B.      Medicare Parts A & B eligible.
        C.      Medicaid eligible with incomes up to the Institutional Care
                Program level (ICP).
        D.      Reside in the project service area.
        E.      Determined by CARES to be at risk of nursing home placement and
                meet one or more of the following clinical criteria:
                1.      Require some help with five or more activities of daily
                        living (ADLs); or
                2.      Require some help with four ADLs plus requiring
                        supervision or administration of medication; or
                3.      Require total help with two or more ADLs; or
                4.      Have a diagnosis of Alzheimer's disease or another type
                        of dementia and require some help with three or more
                        ADLs; or
                5.      Have a diagnosis of a degenerative or chronic condition
                        requiring daily nursing services.
        F.      Determined by CARES to be a person who, on the effective date of
                enrollment, can be safely served with home and community-based
                services.

2.2     ELIGIBILITY DETERMINATION

        A.      The Florida Department of Children and Families (formerly the
                Department of Health and Rehabilitative Services) and the
                federal Social Security Administration determine a person's
                financial and categorical Medicaid eligibility. Financial
                eligibility for the project will be up to the Medicaid ICP
                income and asset level.
        B.      The department's CARES program determines a person's clinical
                eligibility for the project.

2.3     PERSONS NOT ELIGIBLE FOR ENROLLMENT IN THE PROJECT

        A.      Persons residing outside the project service area.
        B.      Persons residing in a state hospital, intermediate care facility
                for persons with developmental disabilities, or a correctional
                institution.

                             Attachment I- 20 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        C.      Persons receiving services through a Medicaid or Medicare
                hospice program.
        D.      Persons participating in or enrolled in another Medicaid waiver
                project.
        E.      Medicaid eligible recipients who are served by the Florida
                Assertive Community Treatment Team(FACT team).
        F.      Persons enrolled in any other Medicaid capitated long-term care
                program.

SECTION 3       MARKETING, CHOICE COUNSELING, ENROLLMENT AND DISENROLLMENT

3.1     MARKETING/ CHOICE COUNSELING

        A.      The contractor may not market to prospective enrollees face to
                face.
        B.      The contractor may use mass marketing strategies, approved by
                the department, to communicate information regarding the project
                to prospective enrollees.
        C.      CARES staff will provide prospective enrollees with information
                regarding their Medicaid long-term care options. These options
                may include: enrolling in the project, participating in another
                Medicaid home and community-based services waiver program,
                placement in a nursing home, or declining long-term care
                assistance.
        D.      CARES staff will also perform a choice counseling function for
                the project. The choice counseling function includes providing
                the prospective enrollee with contractor prepared, and
                department approved, marketing materials, and explaining the
                following:
                1.      The concept of managed care and the integrated delivery
                        of acute and long-term care.
                2.      The advantages to the enrollees of the integration and
                        coordination of acute and long-term care.
                3.      The qualifications for enrollment in the project.
                4.      That the enrollee has the right to choose any of the
                        contractors (pending the qualification of more than one
                        contractor) in the service area and may change
                        contractors if the enrollee is not satisfied with
                        his/her initial choice.
                5.      The benefits provided under the project.

3.2     ENROLLMENT PROCEDURES

        A.      When a person is determined to be both financially and
                clinically eligible and chooses to enroll in this project, CARES
                staff will enroll the person in the project and complete a
                project enrollment form.
        B.      CARES staff will forward the approved enrollment form to the
                prospective contractor, and forward a copy of the form to the
                appropriate Area Agency on Aging.
        C.      The contractor will forward the enrollment information to the
                Medicaid fiscal agent through the enrollment, disenrollment, and
                cancellation report for payment. This information must be
                transmitted to the fiscal agent by the monthly reporting
                deadline (usually the Wednesday preceeding the next to last
                Saturday of the month) in order to be effective for the
                subsequent month.
        D.      The contractor will not be allowed to deny enrollment to anyone
                that is enrolled by CARES except as provided for in section 1.20

3.3     EFFECTIVE DATE OF ENROLLMENT

        In general, enrollment is effective at 12:01 a.m. on the first day of
        the calendar month that the enrollee's name appears on the report for
        payment issued by the Medicaid fiscal agent. Enrollment may begin
        retroactively when the contractor and the CARES staff agree that
        services must begin immediately pursuant to section 3.4 of this
        document. Enrollment is in whole months except when retroactive
        enrollment is agreed to, and in the case of those enrolling in hospice
        care pursuant to Chapter 409.912(30), Florida Statutes.

                             Attachment I- 21 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

3.4     TRANSITION CARE PLANNING

        Transition care services are those services necessary in order to safely
        maintain a person in the community both prior to and after the effective
        date of their enrollment in the project up until the time the Plan of
        Care is implemented.

        CARES staff will notify the contractor, the lead agency, and when
        appropriate, hospital discharge planning staff regarding the need for a
        transition care plan. CARES staff will forward, to each of these
        entities, any information collected during the clinical eligibility
        determination process related to the person's health status, functional
        status, caregiver, social support system, living environment and how
        current service needs are being met.

        By the first date of enrollment, the contractor must provide transition
        care services in collaboration with CARES staff, and be able to assume
        responsibility for meeting the enrollee's care needs. The contractor
        must ensure that enrollment in the project does not interrupt or delay
        the delivery of services needed by the enrollee.

3.5     ORIENTATION

        A.      Prior to or on enrollment the contractor must provide each new
                enrollee with a written notice of the effective date of
                enrollment and a plan ID card which includes the contractor's
                name, address and the member services telephone number.
        B.      The contractor must notify, within five (5) working days from
                the effective date of enrollment, all new enrollees, or their
                representatives to schedule program orientation. Within two (2)
                weeks from the date on which the contractor notifies the new
                enrollee, face-to-face project orientation must be completed.
        C.      The contractor shall assure that appropriate foreign language
                versions of all materials are developed and available to members
                and potential members. The contractor shall provide interpreter
                services in person where practical, but otherwise by telephone,
                for applicants or members whose primary language is a foreign
                language. Foreign language versions of materials are required
                if, as provided annually by the agency, the population speaking
                a particular foreign (non-English) language in a county is
                greater than five (5) percent.
        D.      The contractor must provide each new enrollee with an enrollee
                handbook prior to or at the time of orientation. The enrollee
                handbook must be written so it can be read and understood by the
                enrollees or their representatives and must include the
                following items:
                1.      The project benefit's package including any benefit
                        limitations.
                2.      An explanation of the role of the case manager.
                3.      A list of the service providers in the contractor's
                        network including their address and telephone number.
                4.      Information regarding the enrollee's right to choose a
                        provider from the list of providers within the
                        contractor's network.
                5.      Instructions on how enrollees obtain access to the
                        services included in their care plans.
                6.      The consequences of obtaining care from out-of-network
                        providers.
                7.      Grievance procedures which include each step the
                        enrollee must take from reporting an informal complaint
                        to a formal grievance, including contact information,
                        timelines, and procedures.
                8.      Information regarding the enrollee's right to disenroll
                        at any time and instructions to initiate the
                        disenrollment process. Information must explain that if
                        voluntary disenrollment is requested prior to the fiscal
                        agent's monthly processing deadline, disenrollment will
                        be effective the first of the following month. If
                        voluntary disenrollment is requested after the fisca1
                        agent's monthly processing deadline, disenrollment will
                        not take place until the first of the month subsequent
                        to the next month.

                             Attachment I- 22 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                9.      Information regarding the enrollee's rights and
                        responsibilities.
                10.     Information regarding the confidentiality of enrollee
                        records.
                11.     Information regarding the health care advanced
                        directives pursuant to Chapter 765, Florida Statutes.
                12.     Notification to the enrollee that the following items
                        are available to them upon request:
                        a.      A detailed description of the contractor's
                                authorization and referral process for services.
                        b.      A detailed description of the contractor's
                                process used to determine whether services are
                                medically necessary.
                        c.      A detailed description of the contractor's
                                quality assurance program.
                        d.      A detailed description of the contractor's
                                credentialing process.
                        e.      The policies and procedures relating to the
                                contractor's prescription drug benefits program.
                        f.      The policies and procedures relating to the
                                confidentiality and disclosure of the enrollee's
                                medical records.

3.6     DISENROLLMENT

        A.      Enrollees must be allowed to voluntarily disenroll at any time.
                If voluntary disenrollment is requested prior to the fiscal
                agent's monthly processing deadline, disenrollment will be
                effective the first of the following month. If voluntary
                disenrollment is requested after the fiscal agent's monthly
                processing deadline, disenrollment will not take place until the
                first of the month subsequent to the next month.
        B.      The contractor must ensure that it does not restrict the
                enrollee's right to voluntarily disenroll in any way, and that
                it does not deter the enrollee's contact with the state.
        C.      Immediately upon receiving a voluntary request for
                disenrollment, the contractor must inform the enrollee of
                disenrollment procedures and notify the Department of Elder
                Affairs.
        D.      The contractor must make disenrollment assistance available
                during business hours. This assistance must be available through
                a toll-free telephone number or face-to-face contact. The
                contractor's written disenrollment procedure must list the staff
                responsible for this type of assistance.
        E.      The contractor must keep a daily log of all verbal and written
                disenrollment requests and the disposition of such requests. The
                contractor must ensure that disenrollment request logs are
                maintained in an identifiable manner, involuntary disenrollment
                documents are maintained in an identifiable enrollee record, and
                enrollees who wish to file a grievance are afforded appropriate
                notice and opportunity to do so.
        F.      The contractor shall assure that appropriate foreign language
                versions of all disenrollment materials are developed and
                available to members. The contractor shall provide interpreter
                services in person where practical, but otherwise by telephone,
                for members whose primary language is foreign. Foreign language
                versions of disenrollment materials are required if, as provided
                annually by the agency, the population speaking a particular
                foreign (non-English) language in a county is greater than five
                (5) percent.
        G.      Involuntary disenrollments are limited to the following reasons:
                1.      Enrollee death.
                2.      Ineligibility for Medicaid.
                3.      Ineligibility for the project.
                4.      Moving outside the project's service area.
                5.      Fraudulent use of the enrollee's Medicaid ID card.
                6.      Non-cooperation, subject to department approval.
        H.      After providing at least one verbal and at least one written
                warning of the full implications of failure to follow a
                recommended plan of care, the contractor may submit an
                involuntary disenrollment request to the department for an
                enrollee who continues

                             Attachment I- 23 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                not to comply. The department may approve such a request
                provided that a written explanation of reason for disenrollment
                is given to the enrollee prior to the effective date and
                provided that the enrollee's actions are not related to the
                enrollee's medical or mental condition. Enrollees must be given
                a reasonable opportunity to comply with the plan of care
                subsequent to each verbal and written warning before
                disenrollment is made effective except in instances where the
                enrollee's actions threaten the health, safety, or well being of
                service providers or contractor's staff or representatives.
                Enrollees who are disenrolled through this section are not
                eligible for re-enrollment without the permission of the
                contractor.
        I.      The contractor may also submit an involuntary disenrollment
                request for an enrollee whose behavior is disruptive, unruly,
                abusive, or uncooperative to the extent that his or her
                enrollment with the contractor seriously impairs the
                contractor's ability to furnish services to either the enrollee
                or other enrollees. The contractor must provide at least one
                verbal and one written warning to the enrollee regarding the
                implications of his or her actions. A written explanation of the
                reason for disenrollment must be given to the enrollee prior to
                submitting the disenrollment request. The department may approve
                such requests provided the contractor has documented the actions
                described above and the enrollee's actions are not related to
                the enrollee's medical or mental condition. Enrollees who are
                disenrolled through this action are not eligible for
                re-enrollment without the permission of the contractor.
        J.      For enrollees who wish to disenroll to participate in the
                Medicaid or Medicare hospice program, the contractor must submit
                a disenrollment request to the department for the enrollee
                immediately upon obtaining notice that the enrollee has been or
                will be admitted. The disenrollment will be effective upon the
                date of admission to the hospice.
        K.      Disenrollment request forms, whether completed by the
                contractor, the enrollee, or the department, must contain the
                following information: name, address, telephone number, reason
                for disenrollment with brief explanation, a signature by the
                enrollee or designee (for voluntary requests submitted by the
                enrollee), date, signatures by the contractor's staff (for
                involuntary disenrollments submitted by the contractor), and an
                indication as to whether or not the enrollee wishes to file a
                grievance.
        L.      All disenrollments, including those subject to prior approval,
                must be completed through the submission of a disenrollment
                report to the Medicaid fiscal agent in the enrollment,
                disenrollment, and cancellation report for payment.
        M.      The contractor must provide disenrollment data via the
                disenrollment report on the first available transmission after
                the date of receipt of the disenrollment request. In no event
                will the contractor submit a disenrollment report with an
                effective date later than 49 calendar days after the
                contractor's receipt of a voluntary disenrollment request.

SECTION 4       SERVICE PROVISIONS

4.1     GENERAL

        A.      The contractor must bear the underwriting risk of all services
                covered under this contract.
        B.      Services are to be provided in accordance with an individualized
                plan of care. The plan of care is developed by the contractor in
                consultation with the enrollee and must include those services
                that are determined through assessment to be necessary to
                address the health and social service needs of the enrollee.
        C.      The contractor must directly provide at least one of the
                services listed in section 4.2.
        D.      The contractor must not require any co-payment or cost sharing
                from the enrollees except where the Florida Department of
                Children and Families has assessed a patient responsibility
                amount for financial contributions by the enrollee toward
                nursing facility and assisted living services.

                             Attachment I- 24 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        E.      The contractor must not allow enrollees to be charged for missed
                appointments.
        F.      The contractor is responsible for Medicare co-insurance and
                deductibles for contractor covered services. The contractor
                shall reimburse providers for Medicare deductibles and
                co-insurance Medicaid guidelines or the rate negotiated with the
                provider.
        G.      All services delivered by the contractor to enrollees, either
                directly or through a subcontract, must be guided by the
                following service delivery principles:
                1.      Services must be individualized as a result of a
                        competent, comprehensive understanding of an enrollee's
                        multiple needs.
                2.      Services must be delivered in a timely fashion in the
                        least restrictive, cost-effective and appropriate
                        setting.
                3.      Long-term care services must be based upon an enrollee's
                        plan of care and include goals, objectives, and specific
                        treatment strategies.
                4.      Services must be coordinated to address comprehensive
                        needs and provide continuity of care.
                5.      Services must be delivered regardless of geographic
                        location within the service area, level of functioning,
                        cultural heritage, degree of illness of the enrollee.
                6.      The project's administration and service delivery system
                        must ensure the participation of the enrollee in care
                        planning and delivery, and, as appropriate, allow for
                        the participation of the family, significant others, and
                        caregivers.
                7.      The contractor shall provide interpreter services in
                        person where practical, but otherwise by telephone, for
                        applicants or enrollees whose primary language is
                        foreign. Foreign language versions of materials are
                        required if, as provided annually by the agency, the
                        population speaking a particular foreign (non-English)
                        language in a county is greater than five (5) percent.
                8.      Services must be delivered by qualified providers as
                        defined in sections 4.4 and 4.5. The contractor must
                        have a credentialing system approved by an accreditation
                        organization that has been approved by the agency
                        pursuant to Section 641.512, Florida Statutes. The
                        system must include procedures for credentialing
                        long-term care providers.
                9.      All facilities providing services to enrollees must be
                        accessible to persons with disabilities, be smoke free,
                        and have adequate space, supplies, good sanitation, and
                        fire and safety procedures.

4.2     LONG-TERM CARE SERVICES

        With the exception of nursing facility services, the long-term care
        services in this section are authorized under the Medicaid home and
        community-based waiver.
        A.      Adult Companion Services: Non-medical care, supervision and
                socialization provided to a functionally impaired adult.
                Companions assist or supervise the enrollee with tasks such as
                meal preparation or laundry and shopping, but do not perform
                these activities as discrete services. The provision of
                companion services does not entail hands-on nursing care. This
                service includes light housekeeping tasks incidental to the care
                and supervision of the enrollee.
        B.      Adult Day Health Services: Services provided pursuant to Chapter
                400, Part V, Florida Statutes. For example, services furnished
                in an outpatient setting, encompassing both the health and
                social services needed to ensure optimal functioning of an
                enrollee, including social services to help with personal and
                family problems, and planned group therapeutic activities. Adult
                day health services include nutritional meals. Meals are
                included as a part of this service when the patient is at the
                center during meal times. Adult day health care provides medical
                screening emphasizing prevention and continuity of care
                including routine blood pressure checks and diabetic maintenance
                checks. Physical, occupational and speech therapies indicated in
                the enrollee's plan of care are furnished as components of this
                service. Nursing services which include periodic evaluation,
                medical supervision and supervision of self-care services
                directed toward activities of daily living and personal hygiene
                are also a component of this service. The inclusion of physical,
                occupational and speech therapy services and nursing

                             Attachment I- 25 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                services as components of adult day health services does not
                require the contractor to contract with the adult day health
                provider to deliver these services when they are included in an
                enrollee's plan of care. The contractor may contract with the
                adult day health provider for the delivery of these services or
                the contractor may contract with other providers qualified to
                deliver these services pursuant to the terms of this contract.
        C.      Assisted Living Services: Personal care services, homemaker
                services, chore services, attendant care, companion services,
                medication oversight, and therapeutic social and recreational
                programming provided in a home-like environment in an assisted
                living facility licensed pursuant to Chapter 400 Part II,
                Florida Statutes, in conjunction with living in the facility.
                This service does not include the cost of room and board
                furnished in conjunction with residing in the facility. This
                service includes 24 hour on-site response staff to meet
                scheduled or unpredictable needs in a way that promotes maximum
                dignity and independence, and to provide supervision, safety and
                security. Individualized care is furnished to persons who reside
                in their own living units (which may include dual occupied units
                when both occupants consent to the arrangement) which may or may
                not include kitchenette and/or living rooms and which contain
                bedrooms and toilet facilities. The resident has a right to
                privacy. Living units may be locked at the discretion of the
                resident, except when a physician or mental health professional
                has certified in writing that the resident is sufficiently
                cognitively impaired as to be a danger to self or others if
                given the opportunity to lock the door. The facility must have a
                central dining room, living room or parlor, and common activity
                areas, which may also serve as living rooms or dining rooms. The
                resident retains the right to assume risk, tempered only by a
                person's ability to assume responsibility for that risk. Care
                must be furnished in a way that fosters the independence of each
                consumer to facilitate aging in place. Routines of care
                provision and service delivery must be consumer-driven to the
                maximum extent possible, and treat each person with dignity and
                respect. Assisted living services may also include: physical
                therapy, occupational therapy, speech therapy, medication
                administration, and periodic nursing evaluations. The contractor
                may arrange for other authorized service providers to deliver
                care to residents of assisted living facilities in the same
                manner as those services would be delivered to a person in their
                own home.
        D.      Case Management Services: Services which facilitate enrollees
                gaining access to other needed services regardless of the
                funding source for the services, and which contribute to the
                coordination and integration of care delivery. The contractor
                will provide this service directly.
        E.      Chore Services: Services needed to maintain the home as a clean,
                sanitary and safe living environment. This service includes
                heavy household chores such as washing floors, windows and
                walls, tacking down loose rugs and tiles, and moving heavy items
                of furniture in order to provide safe entry and exit.
        F.      Consumable Medical Supply Services: The provision of disposable
                supplies used by the enrollee and care giver, which are
                essential to adequately care for the needs of the enrollee.
                These supplies enable the enrollee to perform activities of
                daily living or stabilize or monitor a health condition.
                Consumable medical supplies include adult disposable diapers,
                tubes of ointment, cotton balls and alcohol for use with
                injections, medicated bandages, gauze and tape, colostomy and
                catheter supplies, and other consumable supplies. Not included
                are items covered under the Medicaid home health service,
                personal toiletries, and household items such as detergents,
                bleach, and paper towels, or prescription drugs.
        G.      Environmental Accessibility Adaptation Services: Physical
                adaptations to the home required by the enrollee's plan of care
                which are necessary to ensure the health, welfare and safety of
                the enrollee or which enable the enrollee to function with
                greater independence in the home and without which the enrollee
                would require institutionalization. Such adaptations may include
                the installation of ramps and grab-bars, widening of doorways,
                modification of bathroom facilities, or installation of
                specialized electric and plumbing systems to accommodate the
                medical equipment and supplies which are necessary for the
                welfare of the enrollee. Excluded are those

                             Attachment I- 26 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                adaptations or improvements to the home that are of general
                utility and are not of direct medical or remedial benefit to the
                enrollee, such as carpeting, roof repair, or central air
                conditioning. Adaptations which add to the total square footage
                of the home are not included in this benefit. All services must
                be provided in accordance with applicable state and local
                building codes.
        H.      Escort Services: Personal escort for enrollees to and from
                service providers. An escort may provide language interpretation
                for people who have hearing or speech impairments or who speak a
                language different from that of the provider. Escort providers
                assist enrollees in gaining access to services.
        I.      Family Training Services: Training and counseling services for
                the families of enrollees served under this contract. For
                purposes of this service, "family" is defined as the individuals
                who live with or provide care to a person served by the
                contractor and may include a parent, spouse, children,
                relatives, foster family, or in-laws. "Family" does not include
                persons who are employed to care for the enrollee. Training
                includes instruction and updates about treatment regimens and
                use of equipment specified in the plan of care to safely
                maintain the enrollee at home.
        J.      Financial Assessment/Risk Reduction Services: Assessment and
                guidance to the caregiver and enrollee with respect to financial
                activities. This service provides instruction for and/or actual
                performance of routine, necessary, monetary tasks for financial
                management such as budgeting and bill paying. In addition, this
                service also provides financial assessment to prevent
                exploitation by sorting through financial papers and insurance
                policies and organizing them in a usable manner. This service
                provides coaching and counseling to enrollees to avoid financial
                abuse, to maintain and balance accounts that directly relate to
                the enrollees living arrangement at home, or to lessen the risk
                of nursing home placement due to inappropriate money management.
        K.      Home Delivered Meals: Nutritionally sound meals to be delivered
                to the residence of an enrollee who has difficulty shopping for
                or preparing food without assistance. Each meal is designed to
                provide 1/3 of the Recommended Dietary Allowance (RDA). Home
                delivered meals may be hot, cold, frozen, dried, canned or a
                combination of hot, cold, frozen, dried, canned with a
                satisfactory storage life.
        L.      Homemaker Services: General household activities (meal
                preparation and routine household care) provided by a trained
                homemaker.
        M.      Nutritional Assessment/Risk Reduction Services: An assessment,
                hands-on care, and guidance to caregivers and enrollees with
                respect to nutrition. This service teaches caregivers and
                enrollees to follow dietary specifications that are essential to
                the enrollee's health and physical functioning, to prepare and
                eat nutritionally appropriate meals and promote better health
                through improved nutrition. This service may include
                instructions on shopping for quality food and on food
                preparation.
        N.      Personal Care Services: Assistance with eating, bathing,
                dressing, personal hygiene, and other activities of daily
                living. This service includes assistance with preparation of
                meals, but does not include the cost of the meals themselves.
                This service may also include housekeeping chores such as bed
                making, dusting and vacuuming, which are incidental to the care
                furnished or which are essential to the health and welfare of
                the enrollee, rather than the enrollee's family.
        O.      Personal Emergency Response Systems (PERS): The installation and
                service of an electronic device which enables enrollees at high
                risk of institutionalization to secure help in an emergency. The
                PERS is connected to the person's phone and programmed to signal
                a response center once a "help" button is activated. The
                enrollee may also wear a portable "help" button to allow for
                mobility. PERS services are generally limited to those enrollees
                who live alone or who are alone for significant parts of the day
                and who would otherwise require extensive supervision.
        P.      Respite Care Services: Services provided to enrollees unable to
                care for themselves furnished on a short-term basis due to the
                absence or need for relief of persons normally providing the
                care. Respite care does not substitute for the care usually
                provided by a registered nurse, a licensed practical nurse or a
                therapist. Respite care is provided in

                             Attachment I- 27 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                the home/place of residence. Medicaid licensed hospital, nursing
                facility, or assisted living facility.
        Q.      Occupational Therapy: Treatment to restore, improve or maintain
                impaired functions aimed at increasing or maintaining the
                enrollee's ability to perform tasks required for independent
                functioning when determined through a multi-disciplinary
                assessment to improve an enrollee's capability to live safely in
                the home setting.
        R.      Physical Therapy: Treatment to restore, improve or maintain
                impaired functions by using activities and chemicals with heat,
                light, electricity or sound, and by massage and active,
                resistive, or passive exercise when determined through a
                multi-disciplinary assessment to improve an enrollee's
                capability to live safely in the home setting.
        S.      Speech Therapy: The identification and treatment of neurological
                deficiencies related to feeding problems, congenital or
                trauma-related maxillofacial anomalies, autism, or neurological
                conditions that effect oral motor functions. Therapy services
                include the evaluation and treatment of problems related to an
                oral motor dysfunction when determined through a
                multi-disciplinary assessment to improve an enrollee's
                capability to live safely in the home setting.
        T.      Nursing Facility Services: Services furnished in a health care
                facility licensed under Chapter 395 or Chapter 400 Part II,
                Florida Statutes. When an enrollee is placed in a nursing
                facility the enrollee continues to receive acute care services,
                however, the home and community-based long-term care waiver
                services cease.

4.3     ACUTE-CARE SERVICES

        The following services are covered for Medicaid recipients based on the
        Medicaid state plan approved by the federal Centers for Medicare and
        Medicaid Services. These services are covered in the project to the
        extent that they are not covered by Medicare or are reimbursed by
        Medicaid pursuant to Medicaid's Medicare cost-sharing policies.
        A.      Community Mental Health Services: Community-based rehabilitative
                services, which are psychiatric in nature, recommended or
                provided by a psychiatrist or other physician. Such services
                must be provided in accordance with the policy and service
                provisions specified in the Medicaid Community Mental Health
                Coverage and Limitations Handbook except that the provider need
                not be a community mental health center.
        B.      Hearing Services: Services including a hearing evaluation,
                diagnostic testing and selective amplification procedures
                necessary to certify an enrollee for a hearing aid device;
                fitting and dispensing of hearing aids; and repair services as
                specified in the Medicaid Hearing Services Coverage and
                Limitations Handbook. Medical and surgical treatment for hearing
                disorders is part of physician services.
        C.      Home Health Care Services: Intermittent or part-time nursing
                services provided by a registered nurse or licensed practical
                nurse, or personal care services provided by a licensed home
                health aide, with accompanying necessary medical supplies,
                appliances, and durable medical equipment. Such services must be
                provided in accordance with the policy and service provisions
                specified in the Medicaid Home Health Coverage and Limitations
                Handbook.
        D.      Independent Laboratory and Portable X-ray Services: Medically
                necessary and appropriate diagnostic laboratory procedures and
                portable x-rays ordered by a physician or other licensed
                practitioner of the healing arts as specified in the Independent
                Laboratory and Portable X-ray Services Coverage and Limitations
                Handbook.
        E.      Inpatient Hospital Services: Medically necessary services,
                including ancillary services, furnished to inpatient enrollees,
                provided under the direction of a physician or dentist, in a
                hospital maintained primarily for the care and treatment of
                patients with disorders other than mental diseases. Such
                services must be provided in accordance with the policy and
                service provisions specified in the Medicaid Hospital Coverage
                and Limitations Handbook.

                             Attachment I- 28 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        F.      Outpatient Hospital/Emergency Medical Services: Outpatient
                preventive, diagnostic, therapeutic, or palliative care provided
                under the direction of a physician at a licensed hospital. Such
                services include emergency room, dressings, splints, oxygen,
                physician ordered services and supplies necessary for the
                clinical treatment of a specific diagnosis or treatment as
                specified in the Medicaid Hospital Coverage and Limitations
                Handbook.
        G.      Physician Services: Those services and procedures rendered by a
                licensed physician at a physician's office, patient's home,
                hospital, nursing facility or elsewhere when dictated by the
                need for preventive, diagnostic, therapeutic or palliative care,
                or for the treatment of a particular injury, illness, or disease
                as specified in the Medicaid Physicians Coverage and Limitations
                Handbook.
        H.      Prescribed Drug Services: Products and services associated with
                dispensing medicinal drugs pursuant to a valid prescription as
                defined in Chapter 465, Florida Statutes (the "Florida Pharmacy
                Act"). This benefit generally includes all legend drugs
                dispensed to enrollees in outpatient settings and includes
                patent or proprietary preparations. Covered drugs, injectables
                and other prescribed drug services are described in the
                Prescribed Drugs Services and Limitations Handbook. These
                services also include payment for Medicaid reimbursable
                psychotropic drugs. The contractor must furnish those drugs in
                dosage forms currently covered by the Medicaid Program and must
                not place a dollar limit on this service. The contractor must
                not have a pharmacy benefits management program that is more
                restrictive than Medicaid fee-for-service. The contractor's
                pharmacy benefits management program must comply with all
                applicable federal and state laws.
        I.      Visual Services: These services include a visual examination;
                fitting, dispensing, and adjustment of eyeglasses; follow-up
                examinations, and contact lenses as specified in the Medicaid
                Visual Services Coverage and Limitations Handbook. Examinations
                and treatment for eye diseases are part of the physician
                services program. Specific information to order glasses is
                available in Chapter 4 of the Medicaid Visual Services Coverage
                and Limitations Handbook. Lenses must meet American National
                Standards Institute (ANSI) standards. Eyeglasses are available
                through Prison Rehabilitative Industries and Diversified
                Enterprise (PRIDE) or may be purchased elsewhere if available at
                lower prices for comparable quality than those charged by the
                Division of Corrections optical laboratory. An abbreviated list
                of products/services available from PRIDE may be obtained by
                contacting PRIDE's Tallahassee branch office at (850) 487-3774.

4.4     OPTIONAL SERVICES

        The following services may be rendered within Medicaid guidelines at the
        option of the contractor:

        A.      DENTAL SERVICES: The contractor may choose to provide adult
                dental services as defined in the Medicaid Dental Coverage and
                Limitations Handbook including services necessary to seat
                complete dentures, and repair and reline dentures for enrollees.
                Extractions and other surgical procedures, essential to the
                preparation of the mouth for dentures, are included only if the
                enrollee is to receive dentures. The adult dental service does
                not include routine preventive, restorative, or palliative
                treatment.
        B.      TRANSPORTATION SERVICES: The contractor may choose to provide
                transportation. These services are the arrangement and provision
                of an appropriate mode of transportation for enrollees to
                receive necessary medical services. Types of transportation
                services include: ambulance, non-emergency medical vehicles,
                public and private transportation vehicles, and air ambulances
                as specified in the Medicaid Transportation Coverage and
                Limitations Handbook.

                             Attachment I- 29 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

4.5     EXPANDED SERVICES

        The contractor may provide services offered by the plan and approved by
        the agency in excess of the amount, duration, and scope of those listed
        in Sections 4.2, Long-Term Care Services, 4.3 Acute Care Services, and
        4.4. Optional Services.

4.6     MINIMUM LONG-TERM CARE SERVICE PROVIDER QUALIFICATIONS

        The long-term care services authorized in this project must be provided
        in accordance with the following requirements.
        A.      Adult Companion Services: Providers must be employed by a
                licensed home health agency pursuant to Chapter 400, Part IV,
                Florida Statutes, or have a certificate of registration issued
                by the Agency for Health Care Administration pursuant to Section
                400.509, Florida Statutes.
        B.      Adult Day Health Services: Providers must be licensed by the
                Agency for Health Care Administration as an adult day care
                center pursuant to Chapter 400, Part V, Florida Statutes, or
                meet the adult day care center exemption requirements in Section
                400.553, Florida Statutes.
        C.      Assisted Living Facility Services: Providers must be licensed
                pursuant to Chapter 400, Part III, Florida Statutes.
        D.      Case Management Services: Providers must have a Bachelor's
                Degree in Social Work, Sociology, Psychology, Nursing,
                Gerontology or a related field and be trained or have experience
                in geriatric case management and must complete four hours of
                in-service training annually.
        E.      Chore Services: Providers must be a lead agency as defined in
                Section 430.203(9), Florida Statutes; a home health agency
                licensed in accordance with Chapter 400, Part IV, Florida
                Statutes; a pest control agency licensed pursuant to Section
                482.071, Florida Statutes; a construction contractor licensed to
                do home repair pursuant to Section 489.131, Florida Statutes; or
                a person, employed by or under the direct supervision of the
                contractor, who the contractor has confirmed is qualified by
                training or experience to provide chore services and who has
                received the following training:
                1.      Safety and home accident prevention.
                2.      Enrollee record confidentiality.
                3.      Project policies and procedures.
                4.      Background and purpose of the program.
                5.      Emergency procedures in the event of a crisis during the
                        course of work.
                6.      House and yard cleaning and sanitation.
                7.      Simple repairs and the use of related tools and
                        equipment.
                8.      Training about the aging process and first aid.
        F.      Consumable Medical Supply Services: Providers must be pharmacies
                or drug stores permitted under Section 465.022, Florida
                Statutes; medical supply companies licensed pursuant to Chapter
                205, Florida Statutes; or home health agencies licensed pursuant
                to Chapter 400, Part IV, Florida Statutes.
        G.      Environmental Accessibility Adaptation Services: Providers must
                be properly licensed pursuant to state and local building
                requirements, and be confirmed by the provider to have knowledge
                and experience needed to satisfactorily perform the service.
        H.      Escort Services: Providers must be lead agencies as defined in
                Section 430.203(9), Florida Statutes; home health agencies
                licensed pursuant to Chapter 400, Part IV, Florida Statutes; or
                persons employed by or working under the direct supervision of
                the contractor and trained in the following areas: the dynamics
                of aging; communication and assistance with hearing and visually
                impaired patients; emergency procedures; and enrollee
                confidentiality.
        I.      Family Training Services: Providers must be home health agencies
                licensed pursuant to Chapter 400, Part IV, Florida Statutes;
                lead agencies as defined in Section 430.203(9), Florida
                Statutes; or licensed medical practitioners providing training
                or counseling within the scope of their practice.

                             Attachment I- 30 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        J.      Financial Assessment/Risk Reduction Services: Services must be
                provided by persons who have been confirmed to be qualified to
                perform the service by experience and training such as certified
                financial planners, bank employees or individual bookkeepers,
                lead agencies as defined in Section 430.203(9), Florida
                Statutes; or qualified persons employed by or working under the
                direct supervision of the contractor.
        K.      Home Delivered Meal Providers: Providers must be lead agencies
                as defined in Section 430.203(9), Florida Statutes with a
                contract or referral agreement for the preparation of meals; or
                be employed by or under subcontract with the contractor and meet
                the food service standards as defined in Chapters 500 and 509,
                Florida Statutes.
        L.      Homemaker Service Providers: Services must be provided by home
                health agencies licensed pursuant to Chapter 400, Part IV,
                Florida Statutes; lead agencies as defined in Section
                430.203(9), Florida Statutes; or have a certificate of
                registration issued by the agency pursuant to Section 400.509,
                Florida Statutes.
        M.      Nutritional Assessment Risk Reduction Services: Services must be
                provided by Registered Licensed Dietitians or other health
                professionals functioning in their legal scope of practice. A
                dietetic technician (DTR) may, according to the American
                Dietetic Association, assist a dietitian and assume full
                responsibility under supervision of a Registered Licensed
                Dietitian for a wide range of duties including counseling
                enrollees on specific diets. Nutritional education materials
                must be approved by a Registered Licensed Dietitian. Providers
                may include lead agencies as defined in Section 430.203(9),
                Florida Statutes.
        N.      Nursing Facility Services: Providers must be licensed under
                Chapter 395 or Chapter 400 Part II, Florida Statutes.
        O.      Personal Care Providers: Providers must be lead agencies as
                defined in Section 430.203(9), Florida Statutes; Certified
                Nursing Assistants under Nurse Registries licensed pursuant to
                Section 400.506, Florida Statutes; or home health agencies
                licensed pursuant to Chapter 400, Part IV, Florida Statutes.
        P.      Respite Care Providers: Providers must be employed by a licensed
                home health agency pursuant to Chapter 400, Part IV, Florida
                Statutes; have a certificate of registration issued by the
                Agency for Health Care Administration pursuant to Section
                400.509, Florida Statutes; or be lead agencies as defined in
                Section 430.203(9), Florida Statutes.
        Q.      Occupational, Physical, and Speech Therapy Providers: Providers
                must be home health agencies licensed pursuant to Chapter 400,
                Part IV, Florida Statutes, or, providers holding current
                registration, certification, or licenses pursuant to Chapters
                455, 468, and 486, Florida Statutes.
        R.      Personal Emergency Response System Service Providers: Providers
                must meet the requirements as defined in Chapter 489, Part II,
                Florida Statutes.

4.7     ACUTE CARE PROVIDER QUALIFICATIONS

        For the acute care services that are covered under the contract and are
        also covered by Medicare, the provider qualifications will be those of
        the Medicare program.

        For the acute care services covered under the contract that are not
        covered by Medicare, the contractor must meet the provider requirements
        of the Medicaid programs except that provider type limitations
        associated with certain services will not apply when other provider
        types can legally perform the service.

4.8     AVAILABILITY/ACCESSIBILITY OF SERVICES

        The contractor must make available and accessible sufficient facilities,
        service locations, service sites, and personnel to provide the services.
        The contractor's network of providers must be accessible to the
        enrollees in its service area. Services covered under this contract must
        be available to enrollees to the same extent that such services are
        available in the project service area to persons, with comparable
        functional impairment and health conditions that are not served under
        this contract.

                             Attachment I- 31 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        The contractor must establish appropriate scheduling guidelines for
        service delivery. These guidelines must be communicated in writing to
        providers in the contractor's network. The contractor must develop a
        process for monitoring the scheduling of service delivery and the actual
        time enrollees must wait to receive the service. When the service
        delivery scheduling, or waiting times are excessive the contractor must
        take appropriate action to ensure adequate service delivery.

        The contractor must arrange for a 24 hour on-call system for each
        enrollee. The system may vary by enrollee and should be reflected in the
        enrollee's plan of care. The system should provide for the availability
        of a qualified person with information regarding the enrollee's plan of
        care.

4.9     STAFFING REQUIREMENTS

        A.      A person designated to be responsible for the contract.
        B.      A licensed physician, board certified in geriatrics, to serve as
                a consultant for the contract.
        C.      A person, qualified by training, to be responsible for the
                contract's quality assurance and improvement systems.
        D.      A person designated to be responsible for the contractor's
                orientation, outreach and educational activities who is
                qualified by training and experienced in working with frail
                elders.
        E.      A person designated to be responsible for the health information
                and/or the enrollee records system.
        F.      A person designated to be responsible for the processing and
                resolution of grievances.
        G.      Sufficient support staff to conduct daily business in an orderly
                manner, including having enrollee services staff directly
                available during business hours for enrollee services
                consultation, as determined through management and medical
                reviews. The contractor must maintain sufficient staff available
                24 hours per day to handle care inquiries.
        H.      A person designated to be responsible for the contractor's
                utilization control. A person designated to be responsible for
                case management and qualified case managers in sufficient
                numbers to ensure that the case management requirements are met.
        J.      A plan for recruiting and retaining health care practitioners
                who are minorities as defined in Section 288.703(3), Florida
                Statutes, as required by Section 641.27 in Chapter 96-199, Laws
                of Florida.

4.10    INTEGRATION OF CARE

        A.      Project case managers are responsible for long-term care
                planning and for developing and carrying out strategies to
                coordinate and integrate the delivery of all acute and long-term
                care services to enrollees.
        B.      For those persons enrolled in the contractor's Medicare+Choice
                plan (where applicable), the contractor must have protocols to
                ensure that all acute care services and services are
                coordinated. The enrollee's case manager must coordinate with
                the primary care physician, as well as the enrollee or other
                appropriate person, in the development of acute and long-term
                care plans. The contractor must ensure that all subcontractors,
                delivering services covered by the contract, agree to cooperate
                with the goal of an integrated and coordinated service delivery
                system for the enrollee.
        C.      When contract enrollees elect to remain in the Medicare
                fee-for-service system, the contractor must establish protocols
                to ensure that services are coordinated to the maximum extent
                feasible. The case manager must actively pursue coordination
                with the enrollee's primary care physician and other care
                providers.

                             Attachment I- 32 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        D.      In addition, the contractor will be responsible for the
                following activities to facilitate care coordination:
                1.      The contractor must implement a systematic process for
                        generating or receiving referrals and, with the
                        enrollee's written consent, sharing clinical and
                        treatment plan information, including management of
                        medications.
                2.      The contractor must implement a systematic process for
                        obtaining consent from enrollees or their
                        representatives to share confidential medical and
                        treatment planning information with providers.
                3.      The contractor must implement a systematic process for
                        coordinating care with organizations which are not part
                        of the contractor's network of providers but are
                        otherwise important to the health and well-being of
                        enrollees.
                4.      For enrollees in an assisted living or nursing facility,
                        the contractor will ensure coordination with the
                        medical, nursing, or administrative staff designated by
                        the facility to ensure that the enrollees have timely
                        and appropriate access to the contractor's providers and
                        to coordinate care between those providers and the
                        facility's providers.

4.11    PLAN OF CARE

        A.      The contractor is required to develop an individualized written
                plan of care, in a format approved by the department, for every
                new enrollee within 10 calendar days of the effective date of
                enrollment.
        B.      Services included in the plan of care will be determined by the
                contractor in consultation with the enrollee and be necessary to
                address health and social service needs of the enrollee
                identified through an assessment.
        C.      The plan of care must be based on a comprehensive assessment of
                the enrollee's health status, physical and cognitive
                functioning, environment, social supports, and end-of-life
                decisions. The plan of care must clearly identify barriers to
                the enrollee and caregivers, if applicable. The case manager
                must discuss barriers and explore potential solutions with the
                enrollee, and caregivers when applicable. The plan of care must
                detail all interventions designed to address specific barriers
                to independent functioning. The plan may include services
                provided through the enrollee's own informal network or by
                volunteers from community social service agencies or other
                organizations such as churches and synagogues.
        D.      In developing the plan of care, the contractor must:
                1.      Assess the immediacy of the new enrollee's services
                        needs and include a description of the project
                        participant's condition (e.g., ADL and IADL limitations,
                        incontinence, cognitive impairment, arthritis, high
                        blood pressure), as identified through an appropriate
                        comprehensive assessment and a medical history review.
                2.      Identify any existing care plans and service providers
                        and assess the adequacy of current services.
                3.      Provide for continuous care to the new enrollee if the
                        enrollee is receiving active treatment prior to the
                        effective date of enrollment.
                4.      Ensure that the care plan contains, at a minimum,
                        information about the enrollee's medical condition, the
                        type of services to be furnished, the amount, frequency
                        and duration of each service, and the type of provider
                        to furnish each service.
                5.      Ensure that treatment interventions address identified
                        problems, needs, and conditions. In consultation with
                        the enrollee and, as appropriate, the enrollee's legal
                        guardian or caregiver, the plan of care must specify the
                        long-term care service interventions, and when such
                        services are the responsibility of the contractor, the
                        medical interventions for the enrollee.
                6.      Ensure that review of the care plan is performed through
                        face-to-face contact with the enrollee at least every
                        six (6) months to determine the appropriateness and
                        adequacy of services and to ensure that the services
                        furnished are consistent with the nature and severity of
                        the enrollee's needs.

                             Attachment I- 33 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                7.      Ensure that the care plan is reviewed sooner than the
                        minimum required time frame if in the opinion of the
                        medical professionals involved in the care of the
                        enrollee there is reason to believe significant changes
                        have occurred in the enrollee's condition or in the
                        services the enrollee receives, or an enrollee or an
                        enrollee's legal representative requests another review
                        due to the changes in the enrollee's physical or mental
                        condition.
                8.      The contractor will work to ensure the maintenance or
                        creation of an enrollee's informal network of caregivers
                        and services providers. Primary caregivers, family,
                        neighbors and other volunteers will be integrated into
                        an enrollee's plan of care when it is determined through
                        multi-disciplinary assessment and care planning that
                        these services would improve the enrollee's capability
                        to live safely in the home setting and are agreed to by
                        the enrollee.
                9.      The contractor will implement a systematic process for
                        determining whether enrollees have advance directives,
                        health care powers of attorney, or do not resuscitate
                        orders. This information will become part of the
                        enrollee's medical record and these orders and
                        preferences will be integrated into the care
                        coordination process.
        E.      A copy of the plan of care must be forwarded to the enrollee's
                primary care physician.
        F.      A copy of the plan of care must be forwarded to the department's
                CARES office within 30 days of development.
        G.      Revisions to the plan of care must be done in consultation with
                the enrollee, the caregiver, and when feasible the primary care
                physician. If the primary care physician is not under contract
                with the contractor to deliver services to the enrollee, an
                effort must be made by the case manager to obtain physicians
                input regarding care plan revisions. Changes in service
                provision resulting from a care plan review must be implemented
                within ten (10) calendar days of the review date.

4.12    OUT OF NETWORK USE OF NON-EMERGENCY SERVICES

        Unless otherwise specified in this document, when an enrollee uses
        non-emergency services available under the project from a
        non-subcontracted provider, the contractor is not liable for the cost of
        such utilization unless the contractor referred the enrollee to the
        non-subcontracted provider or authorized such out-of-network
        utilization. The contractor must provide timely approval or denial of
        authorization of out-of-network use through the assignment of a prior
        authorization number which refers to and documents the approval. A
        contractor may not require paper authorization as a condition of an
        enrollee receiving treatment if the contractor has an automated
        authorization system. Written follow-up documentation of the approval
        must be provided to the out-of-network provider within one business day
        from the request for approval. The enrollee is liable for the cost of
        such unauthorized use of contract-covered services from
        non-subcontracted providers.

        However, in accordance with the Balanced Budget Act of 1997, and
        pursuant to 42 CFR 422.100(b)(1)(iv), the plan must also cover
        post-stabilization services without authorization, regardless of whether
        the enrollee obtains the service within or outside the plan's network,
        for the following situations:

                A.      Post stabilization care services that were pre-approved
                        by the plan; or were not pre-approved by the plan
                        because the plan did not respond to the treating
                        provider's request for pre-approval within one hour
                        after being requested to approve such care, or could not
                        be contacted for pre-approval.

                B.      Post stabilization services are services subsequent to
                        an emergency that a treating physician views as
                        medically necessary after an emergency medical condition
                        has been stabilized. These are not emergency services,
                        but are non-emergency services that the plan chooses not
                        to cover out-of-plan except in the circumstances
                        described above.

                             Attachment I- 34 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

SECTION 5       QUALITY ASSURANCE AND IMPROVEMENT REQUIREMENTS

5.1     GENERAL

        The contractor's quality assurance program must address the needs of
        enrollees, promote improved clinical outcomes and quality of life, and
        identify and address service delivery issues. The quality assurance
        program required by this section must comply with applicable provisions
        of Section 409.912(24), Florida Statutes, and Section 641.51, Florida
        Statutes, and may be incorporated into an existing quality improvement
        system.

5.2     QUALITY ASSURANCE PROGRAM

        The contractor must formally adopt a quality assurance program for
        enrollees. The quality assurance program must include written goals,
        policies, and procedures that ensure enhancement of quality of life for
        enrollees, emphasize quality patient outcomes, and, to the extent
        feasible, promote the coordination of acute and long-term care services.
        The quality assurance program must have a system to identify and
        prioritize problem areas for resolution and a process to design and
        implement strategies to resolve identified problems. The system must
        include: a process for changing the current quality assurance program as
        needed; a protocol that dictates the active involvement of the medical
        director, the quality assurance director, medical/clinical providers,
        and the director of the program; and a description of the mechanism for
        measuring the success of quality assurance strategies and for providing
        feedback to all providers involved in the program. Specifically, the
        contractor must have a quality assurance program which includes the
        following:
        A.      A written description of the quality assurance program.
        B.      Written responsibilities of the governing body for monitoring,
                evaluating, and improving care.
        C.      A procedure for quality assurance program supervision.
        D.      Assurance of adequate resources to carry out the program's
                specified activities effectively.
        E.      A protocol for provider participation in the quality assurance
                program.
        F.      A procedure for delegation of quality assurance responsibilities
                to designated personnel.
        G.      A procedure for credentialing and re-credentialing providers.
        H.      A procedure for informing enrollees about their rights and
                responsibilities.
        I.      Assurance of availability of and accessibility to services and
                care.
        J.      A procedure to ensure the accessibility and availability of
                medical and long-term care records, as well as proper record
                keeping, and a process for record review.
        K.      A procedure for utilization review.
        L.      A procedure for quality assurance program documentation.
        M.      A procedure for coordination of quality assurance activities
                with other management activities.
        N.      A continuity of care system.
        O.      An active quality assurance committee.

5.3     QUALITY ASSURANCE COMMITTEE

        The contractor must have a quality assurance committee that is either a
        separate mechanism for addressing the quality assurance concerns of
        eligible frail enrollees, or incorporated into an existing quality
        assurance committee.

        The quality assurance committee must:
        A.      Oversee quality of life indicators such as, but not limited to
                the degree of personal autonomy, provision of services and
                supports to assist people in exercising medical and social
                choices, self-direction of care and maximum use of natural
                support networks.

                             Attachment I- 35 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        B.      Review grievances identified through the contractor's formal and
                informal complaint procedures and through external oversight.
        C.      Review case records of all fair hearings and document internal
                complaint/grievance steps involved in the fair hearing.
        D.      Review quality assurance policies, standards and written
                procedures to ensure that they adequately address the needs of
                its enrollees.
        E.      Review utilization of services with adverse or unexpected
                outcomes for its enrollees.
        F.      Develop and periodically review written guidelines, procedures
                and protocols on areas of concern in the care of the frail
                elderly; for example: falls, incontinence, dementia, depression,
                congestive heart failure, inadequate family care, family
                caregiver stress, family conflict, out-of-home placements,
                alcohol problems, and problems of compliance in procedures of
                medical treatment.
        G.      Develop an ethics committee to review ethical questions such as
                end-of-life decisions and advance directives.
        H.      Develop a system of peer review by physicians and other service
                providers.

5.4     QUALITY OF CARE STUDIES

        The contractor must conduct quality of care studies to monitor the
        quality, appropriateness, and effectiveness of enrollee care. The
        studies must include quarterly reviews of long-term care records of
        enrollees who have received services during the previous quarter. Review
        elements include management of diagnosis, appropriateness and timeliness
        of care, comprehensiveness of and compliance with the plan of care, and
        evidence of special screening for, and monitoring of, high risk persons
        and conditions.

        In accordance with Section 409.912(24) Florida Statutes, the studies
        must:
        A.      Target specific conditions and health service delivery issues
                appropriate to enrollees for focused monitoring and evaluation.
        B.      Use clinical care standards or practice guidelines to
                objectively evaluate health services delivery issues and the
                care the contractor delivers or fails to deliver for acute and
                long-term care conditions.
        C.      Use quality indicators derived from the clinical care standards
                or practice guidelines to screen and monitor care and services
                delivered.
        The contractors selection of conditions and issues to study should be
        based on member profile data.

5.5     INDEPENDENT QUALITY REVIEW

        The agency shall provide for an independent review of all Medicaid
        services provided or arranged by the contractor. The review shall be
        performed at least once annually by an entity outside state government.
        If the independent review indicates that quality of care is not
        acceptable pursuant to contractual requirements, the department may
        restrict the contractor's enrollment until quality of care issues are
        resolved.

SECTION 6.      GRIEVANCE PROCEDURES

        A.      The contractor must develop and implement grievance procedures,
                subject to department and agency written approval, prior to
                implementation. The contractor must refer all enrollees and
                providers on behalf of enrollees who are dissatisfied with the
                contractor, to the grievance coordinator for the appropriate
                follow-up and documentation in accordance with the contractor's
                approved grievance procedures.

                             Attachment I- 36 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        B.      The contractor must make copies of the approved grievance
                procedures available to the enrollee and to a provider acting on
                behalf of an enrollee.
        C.      The contractor's grievance procedures must incorporate the time
                limitations in section (D) and include the following
                requirements:
                1.      How to pursue redress of a grievance.
                2.      Names of the appropriate employees or a list of
                        grievance departments that are responsible for
                        implementing the contractor's grievance procedures. The
                        list must include the address and the toll-free
                        telephone number of each grievance department and the
                        address of the Statewide Provider and Subscriber
                        Assistance Panel and its toll-free hotline telephone
                        number - Agency for Health Care Administration, Bureau
                        of Consumer Protection and Health Quality, Building 1,
                        Room 339, 2727 Mahan Drive, Tallahassee, Florida 32308,
                        (850) 419-3456-Extension 6.
                3.      Allow for the participation of a representative of the
                        Department of Elder Affairs.
                4.      Provide assurance that all enrollees who are
                        dissatisfied with the contractor are referred to the
                        grievance coordinator for the appropriate follow-up and
                        documentation and that someone with problem solving
                        authority on behalf of the contractor is included in the
                        grievance process.
                5.      Upon request, the contractor or the contractor's
                        grievance assistant, as appropriate, must provide the
                        enrollee or provider with a grievance form(s) within
                        three (3) business days of request.
                6.      Respond to a complaint from an enrollee within a
                        reasonable time after its submission. At the time of
                        receipt of the initial complaint, the contractor must
                        inform the enrollee that the enrollee has a right to
                        file a written grievance at any time and that assistance
                        in preparing the written grievance will be provided by
                        the contractor. This requirement also includes a
                        provision where the contractor must offer to meet with
                        the enrollee during the formal grievance process at the
                        administrative offices of the contractor within the
                        service area or at a location within the service area
                        convenient to the enrollee.
                7.      If the contractor is unable to resolve the grievance to
                        the enrollee's satisfaction, the contractor must provide
                        a final decision letter to the enrollee that includes
                        the following:
                        a.      A notice of the right to appeal upon completion
                                of the full grievance procedure and supply the
                                agency with a copy of the final decision letter.
                                In addition, for expedited grievances, the
                                contractor must provide the enrollee notice of
                                the right to appeal immediately upon request.
                        b.      A notice that the enrollee may request a review
                                of the contractor's decision concerning the
                                grievance by the Statewide Provider and
                                Subscriber Assistance Panel, and that such
                                request must be made by the enrollee within 365
                                days after receipt of the final decision letter
                                from the contractor. The contractor must also
                                inform the enrollee how to initiate such a
                                review, and must include the panel's address and
                                telephone number as follows: Agency for Health
                                Care Administration, Bureau of Consumer
                                Protection and Health Quality, Building I, Room
                                339, 2727 Mahan Drive, Tallahassee, Florida
                                32308, (888) 419-3456 Extension 6. In accordance
                                with Section 408.7056, Florida Statutes, the
                                Statewide Provider and Subscriber Assistance
                                Panel will not consider a grievance taken to
                                Medicaid fair hearing.
                        c.      A notice that the enrollee retains the right to
                                pursue a Medicaid fair hearing, as provided by
                                Rule 65-2.042. F.A.C., in addition to pursuing
                                the contractor's grievance procedure, and may
                                contact the Department of Children and Families
                                at the following address to pursue a Medicaid
                                fair hearing: Office of Public Assistance
                                Appeals Hearings, 1317 Winewood Boulevard,
                                Building 5, Room 203, Tallahassee, Florida
                                32399, (859)488-1429.

                             Attachment I- 37 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                8.      Require the participation of physician(s) in reviewing
                        medically related grievances.
                9.      Method for classification of the urgency of grievances
                        and for establishing time limits for an expedited review
                        within which such grievances must be resolved. In an
                        expedited review, all necessary information, including
                        the contractor's decision, must be transmitted between
                        the contractor and the enrollee, or the provider acting
                        on behalf of the enrollee, by telephone, facsimile, or
                        the most expeditious method available. In any case when
                        the expedited review process does not resolve a
                        difference of opinion between the contractor and the
                        enrollee or the provider acting on behalf of the
                        enrollee, the enrollee or the provider acting on behalf
                        of the enrollee may submit a written grievance to the
                        Statewide Provider and Subscriber Assistance Panel. The
                        contractor must not provide an expedited retrospective
                        review of an adverse determination. A request for an
                        expedited review may be submitted orally or in writing.
                        Unless it is submitted in writing, for purposes of the
                        grievance reporting requirements, the request must be
                        considered an appeal of a utilization review decision
                        and not a grievance.
                10.     Notify enrollees that they may voluntarily pursue
                        binding arbitration in accordance with the terms of the
                        contract if offered by the contractor, after completing
                        the grievance procedure and as an alternative to the
                        Statewide Provider and Subscriber Assistance Panel. Such
                        notice must include an explanation that the enrollee may
                        incur some costs.
                11.     Describe of the process through which a enrollee may, at
                        any time, contact the toll-free telephone hotline of
                        the agency, (888) 419-3456, to inform it of the
                        unresolved grievance.
                12.     State that the enrollee has the right to pursue a
                        Medicaid fair hearing as provided by Rule 65-2.042,
                        F.A.C., in addition to pursuing the contractor's
                        grievance procedure. It must also state that the
                        enrollee always has the right to appeal to the agency
                        and the Statewide Provider and Subscriber Assistance
                        Panel after receiving a final disposition of the
                        grievance through the organization's grievance process
                        with the following exception; a grievance taken to
                        Medicaid fair hearing will not be considered by the
                        Panel. In addition, the contractor must notify enrollees
                        of the right to a Medicaid fair hearing at orientation,
                        during care plan development, and at any time an action
                        is taken to reduce, suspend or terminate services, or to
                        deny or terminate participation of the service providers
                        within the contractor's network.
        D.      TIME LIMITATIONS
                1.      The contractor must notify enrollees that a grievance
                        must be submitted within one year after the date of
                        occurrence of the action initiating the grievance.
                2.      With the exception of urgent grievances, the
                        contractor's grievance procedures must have guidelines
                        in place to resolve a grievance within 60 days after
                        receipt of the grievance, or within a maximum of 90 days
                        if the grievance involves the collection of information
                        outside the service area. These time limitations can be
                        tolled if the contractor has notified the enrollee, in
                        writing, that additional information is required for
                        proper review of the grievance and that such time
                        limitations are tolled until such information is
                        provided. After the contractor receives the requested
                        information, the time allowed for completion of the
                        grievance process resumes.
                3.      For an expedited review, the contractor must make a
                        decision and notify the enrollee, or the provider acting
                        on behalf of the enrollee, as expeditiously as the
                        enrollee's medical condition requires, but in no event
                        more than 72 hours after receipt of the request for
                        review. If the expedited review is a concurrent review
                        determination (utilization review conducted during the
                        enrollee's course of treatment) the service must be
                        continued without liability to the enrollee until the
                        enrollee has been notified of the determination. The
                        contractor must provide written confirmation of its
                        decision concerning an expedited review within 2 working
                        days after providing notification of that decision, if
                        the initial notification was not in writing. The
                        contractor must provide reasonable access, not to exceed
                        24 hours after receiving a request for an expedited
                        review, to an

                             Attachment I- 38 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        appropriate clinical peer who can perform the expedited
                        review. The clinical peer or peers must not have been
                        involved in the initial adverse determination.
                4.      In the case of an adverse determination the contractor
                        must make available, to the enrollee, a review of the
                        grievance by an internal review panel; such review must
                        be requested within 30 days after the contractor's
                        transmittal of the final determination notice of an
                        adverse determination. A majority of the panel must be
                        persons who previously were not involved in the initial
                        adverse determination. A person who previously was
                        involved in the adverse determination may appear before
                        the panel to present information or answer questions.
                        The panel must have the authority to bind the contractor
                        to the panel's decision. The contractor must ensure that
                        a majority of the persons reviewing a grievance
                        involving an adverse determination are providers who
                        have appropriate expertise. The contractor must issue a
                        copy of the written decision of the review panel to the
                        enrollee and to the provider, if any, who submits a
                        grievance on behalf of an enrollee. In cases where there
                        has been a denial of coverage of service, the reviewing
                        provider must not be a provider previously involved with
                        the adverse determination.
        E.      Both informal and formal steps must be available to resolve
                grievances. A grievance is not considered formal until it is
                written and signed by an enrollee or completed on such forms as
                prescribed and received by the contractor. A complaint is not
                considered a grievance until the complaint is written and
                received by the contractor.
        F.      Procedural steps must be clearly specified in the enrollee
                handbook for enrollees and the provider manual for providers,
                including the address, telephone number and office hours of the
                grievance coordinator.
        G.      The contractor must insure that appropriate foreign language
                versions of grievance materials are developed and available to
                enrollees and potential enrollees. These foreign language
                versions of materials are required if the population speaking a
                particular foreign (non-English) language in a county is greater
                than five (5) percent.
        H.      The contractor must have sufficient support staff available to
                process grievances within the required time frames, and to
                assist the enrollee in properly filing grievances. The staff
                must also be educated concerning the importance of the grievance
                procedure and the rights of the enrollee.
        I.      The contractor must specify phone numbers for the enrollee,
                subcontractor or other service provider to call to present a
                complaint or to contact the grievance coordinator. Each phone
                number must be toll-free within the enrollee's geographic area
                and provide reasonable access to the contractor without undue
                delays. There must be an adequate number of phone lines to
                handle incoming grievances.
        J.      Grievance procedures must be clearly specified in the enrollee
                handbook, including the address, telephone number and office
                hours of the grievance coordinator.
        K.      The contractor must maintain an accurate record of each formal
                grievance. Each record must include the following:
                1.      A complete description of the grievance, the enrollee's
                        name and address, the provider's name and address, and
                        the contractor's name and address.
                2.      A complete description of the contractor's factual
                        findings and conclusions after the completion of the
                        full formal grievance procedure.
                3.      A complete description of the contractor's conclusions
                        pertaining to the grievance as well as the contractor's
                        final disposition of the grievance.
                4.      A statement as to which levels of grievance procedure
                        the grievance has been processed and how many more
                        levels of the grievance procedure are remaining before
                        the grievance has been processed through the
                        contractor's entire grievance procedure.
        L.      A record of informal complaints received which are not
                grievances must be maintained and include date, time, nature of
                complaint and disposition. The contractor must submit this
                report upon request by the department.

                             Attachment I- 39 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        M.      A report on grievances must be submitted on a monthly basis as
                required in the Reporting Requirements section of this document.
                The report must list the number and nature of all formal
                grievances that have not been resolved to the satisfaction of
                the enrollee, after the enrollee has utilized the full grievance
                procedure of the contractor.

SECTION 7               ENROLLEE RECORDS

                A.      The contractor is responsible for assuring that there is
                        a complete long-term care record for each enrollee.
                B.      The contractor must use procedures that promote the
                        development of a centralized, comprehensive medical and
                        long-term care record for enrollees. The contractor must
                        ensure, with written consent of the enrollee, all
                        providers involved in the enrollees care have access to
                        the enrollee's record for the purpose of providing care.
                C.      The contractor must maintain an enrollee records system
                        which is consistent with professional standards and
                        which permits the prompt retrieval of information. Each
                        record must include timely information accurately
                        documented and must be readily available to all
                        appropriate and authorized practitioners involved in the
                        integration and coordination of care.
                D.      The contractor will ensure that all subcontract
                        providers, including medical specialists and long-term
                        care providers, properly document the care provided to
                        enrollees including, diagnoses determined, medications
                        prescribed, and treatment plans developed.
                E.      The contractor will ensure that enrollee record
                        information is accessible only to authorized persons in
                        accordance with written consent or an executed
                        authorization granted by the enrollee or the enrollee's
                        representative and with all applicable federal and state
                        laws, rules and regulations.
                F.      The contractor must disclose enrollee records, including
                        enrollee and caregiver identifying information to the
                        department and agency in order to fulfill the
                        department's and agency's obligation to oversee the
                        performance or to conduct assessment, investigation, or
                        evaluation of this contract. Not withstanding provisions
                        to the contrary, release of material to the department
                        and agency will not be construed as public disclosure of
                        confidential information.

SECTION 8               REPORTING REQUIREMENTS

8.1     GENERAL REQUIREMENTS

        The contractor is responsible for complying with all reporting
        requirements established by the department and agency. The contractor
        will be responsible for assuring the accuracy and completeness of all
        required reports as well as the timely submission of each report. The
        contractor will be furnished with the appropriate reporting formats,
        instructions, submission timetables and technical assistance as
        required.

        A.      Level of Analysis: The following levels of analysis will be
                used, as indicated, for the required reports:
                1.      Individual Level - One report is required for each
                        enrollee, e.g., one grievance record for each grievance,
                        one record per hospital discharge.
                2.      Location Level - One report required for each nine-digit
                        Medicaid provider number the contractor has under
                        contract.
                3.      Contractor Level - One report is required for each
                        seven-digit Medicaid provider number the contractor has
                        under contract.

                             Attachment I- 40 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        Example: ABC Health Plan, Medicaid Provider Number
                        1234567, operates three locations: ABC of Palm Beach
                        (123456701), ABC of Indian River (123456702), and ABC of
                        Martin (123456703). A plan level report would be
                        summarized over all plans with the seven-digit Medicaid
                        provider code (1234567). A location level report would
                        have one report for each nine-digit provider number
                        (123456701, 123456702, and 123456703).

The following table summarizes the required data reporting for the project

<TABLE>
<CAPTION>
                                LEVEL OF
REPORT NAME                     ANALYSIS       FREQUENCY OF REPORT              SUBMISSION MEDIA
------------------------------------------------------------------------------------------------------
<S>                             <C>            <C>                              <C>
Enrollment, Disenrollment, and  Location       Monthly                          Asynchronous
Cancellation Report for                                                         Transfer to Fiscal
Payment                                                                         Agent

Disenrollment Summary           Location       Monthly                          Electronic mail or
                                                                                diskette

Encounter Data Report           Individual     Quarterly, within 3 months of    Electronic mail or
                                               the end of reporting period      diskette

Grievance Report                Individual     Monthly                          Electronic mail or
                                                                                diskette

Financial Statements            Contractor     Quarterly, within 45 days of     AHCA supplied template
                                               end of reporting period          on diskette

Audited Financial               Contractor     Annually, within 90 days of end  Electronic mail or
Statement                                      of contractor's fiscal year      diskette

Minority Business               Individual     Monthly by the 15th              Electronic mail
Enterprise Contract             Level
Reporting
</TABLE>

8.2     ENROLLMENT, DISENROLLMENT, AND CANCELLATION REPORT FOR PAYMENT

        A.      This report is to be submitted monthly to the Florida Medicaid
                fiscal agent. This report may only be submitted in a file of the
                structure defined below and transmitted asynchronously to the
                Medicaid fiscal agent using the communications protocol defined
                below. The contractor is required to submit each month the data
                shown in the table below for every person who is to be enrolled,
                disenrolled, or canceled during the reported monthly period: The
                transfer file will be a fixed record length ASCII file (80
                bytes) to be transferred to the Medicaid fiscal agent using a
                Hayes Compatible Modem of 9600-57600 BPS operating over the
                public phone network. The data will be transferred using the
                X-MODEM or Z-MODEM transfer protocol. Communications protocol
                will be 8 data bits, 1 stop bit, no parity, full duplex, echo
                off.
        B.      The fiscal agent is authorized to process the monthly enrollment
                input data as an electronic transaction in which payment is
                generated for each enrollee according to the established
                capitation rate. On a specified date each month the plan will
                receive the remittance invoice accompanied by a payment warrant.
                The amount of payment is determined by the number of enrollees
                enrolled in each capitation category and any adjustments that
                may apply.
        C.      File Layout for Monthly Enrollment, Disenrollment, and
                Cancellation Report for Payment

                             Attachment I- 41 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

<TABLE>
<CAPTION>
                                                       FIELD                             START     END         CHARACTER
        DATA ELEMENT                                   NAME                   LENGTH     COLM.     COLM.       OR NUMERIC
-------------------------------------------------------------------------------------------------------------------------
<S>                                            <C>                             <C>        <C>       <C>                 <C>
6 = enrollment, 2 = disenrollment                  Action Code                  1          1         1                  N

Valid 9 digit provider number                     Provider Number               9          2        10                  N

Valid 10 digit Medicaid enrollee I.D.            Enrollee Medicaid             10         11        20                  N
number                                                Number

Enrollee last name                               Enrollee Last Name            12         21        32                  C

Enrollee first name                              Enrollee First Name            9         33        41                  C

Enrollee date of birth (MMDDYYYY)                 Enrollee Date of              8         42        49                  N
                                                  Birth-MM DDYYYY

Contractor assigned enrollee I.D.               Contractor Enrollee ID          9         50        58                  C

Contractor location, assigned by                 Contractor Location           10         59        68                  C
contractor

Fiscal year identifier, used to represent       Contractor Fiscal Year          1         69        69                  C
the fiscal or contract year to which                  Identifier
action code 0 information pertains. Enter
last digit of the last year of the
contract year in which inpatient days were
utilized, (e.g., for the 1996-97 contract
year enter 7)

Number of inpatient days being                  CAP Contractor Units            3         70        72                  N
reported via action code 0 (cap                     Used - Input
update). Must be right justified in field

Inactive field, zero fill                             Filler                    4         73        76                  C

Transaction date (MMYY)                        Contractor Transaction           4         77        80                  C
                                                    Date-MMYY
</TABLE>

8.3     CONTRACTOR DISENROLLMENT SUMMARY

        A.      This report provides a uniform means of reporting each
                contractor's monthly disenrollments. The report is required to
                assess the reasons for each disenrollment and to assure that
                enrollees are disenrolled in compliance with contract
                guidelines.

        B.      File Layout for Monthly Disenrollment Summary Reporting

<TABLE>
<CAPTION>
    FIELD NAME                                       DESCRIPTION                            DATA TYPE      LENGTH
-------------------------------------------------------------------------------------------------------------------
<S>                             <C>                                                         <C>               <C>
CONTRACTOR ID                   9 digit provider code (includes 2 digit location)           Character         9

FROM-DATE                        The beginning date of the reporting period                   Date            8

TO-DATE                          The ending date of the reporting period                      Date            8

REPT-TYPE                       Report Type (always equal to MDS for this report)           Character         5

V1                                           Expects to move                                 Numeric          7

V2                              Wishes to see private M.D., practitioner, or                 Numeric          7
                                          attend another clinic

V3                               Dissatisfied with plan policies or procedures               Numeric          7
</TABLE>

                             Attachment I- 42 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

<TABLE>
<CAPTION>
   Field Name                                        Description                            Data Type       Length
-------------------------------------------------------------------------------------------------------------------
<S>                                <C>                                                       <C>              <C>
V4                                    Enrolled/Enrolling in other Medicaid HMO               Numeric          7

V7                                             Other Voluntary                               Numeric          7

I1                                 Missed 3 consecutive appointments in a continuous         Numeric          7
                                                six month period

I2                                              Moved out of service area                    Numeric          7

I4                                      Fraudulent use of Medicaid or plan ID card           Numeric          7

I5                                                  Death of enrollee                        Numeric          7

I6                                             Loss of Medicaid eligibility                  Numeric          7

I8                                                   Other involuntary                       Numeric          7
</TABLE>

8.4     ENCOUNTER DATA

        The contractor will be required to provide encounter level service
        utilization data in an electronic format to the department as specified
        below, however additional data may be requested as needed to meet state
        and federal requirements:

        The Long-Term Care file should be provided as an ASCII, fixed length
        text file, one record per enrollee, per month, per line. Each record
        will have the following fields (see section 4.2 in your contract for a
        full description of each service). Fill with spaces if there were no
        units of service provided. Right justify all fields unless noted
        otherwise. All "Hours" fields should be accurate to the nearest quarter
        hour (.25). Please be sure to enter the hours as a decimal (e.g., 2.5 is
        two and a half hours; .25 is a quarter hour).

<TABLE>
<CAPTION>
FIELD                                        UNIT OF                           START
NAME            DESCRIPTION                  MEASUREMENT          LENGTH       COL.        END COL.  TEXT/NUMBER
------------------------------------------------------------------------------------------------------------------
<S>             <C>                          <C>                 <C>          <C>         <C>        <C>
SSN             Social Security Number       000000000            9             1          9         N
                (left justify)

MID             Medicaid ID Number           0000000000          10            10          19        N

MO              Report month                 MMYYYY               6            20          25        N

HMKS            Adult Companion Services     Hours (00000.00)     8            26          33        N

ADHC            Adult Day Health Services    Hours (00000.00)     8            34          41        N

ALFP            Assisted Living Services     Days                 5            42          46        N

CM              Case Management              Hours (0000)         5            47          51        N

CHO             Chore Services               Hours (00000.00)     8            52          59        N

EAA             Environmental                Episodes             8            60          67        N
                Accessibility Adaptations

ESCW            Escort Services              Hours (00000.00)     8            68          75        N

EST             Family Training Services     Episodes             5            76          80        N

RRFA            Financial Assessment/        Hours (00000.00)     8            81          88        N
                Risk Reduction services

HDM             Home Delivered Meals         Meals                5            89          93        N

HMK             Homemaker Services           Hours (00000.00)     8            94         101        N

RRNU            Nutritional                  Hours (00000.00)     8           102         109        N
                Assessment/Risk
                Reduction Services

PECA            Personal Care Services       Hours (00000.00)     8           110         117        N

EARI            Personal Emergency           Episodes             5           118         122        N
                Response System
                Installation

EAR             Personal Emergency           Day                  5           123         127        N
                Response System

RESP            Respite Care                 Hours (00000.00)     8           128         135        N

OCTH            Occupational Therapy         Hours (00000.00)     8           136         143        N

PHTH            Physical Therapy             Hours (00000.00)     8           144         151        N

SPTH            Speech Therapy               Hours (00000.00)     8           152         159        N

NF              Nursing Facility Services    Days                 5           160         165        N
</TABLE>

        The Acute Care file should be provided as an ASCII, fixed length text
        file, one record per enrollee, per month, per line. Each record will
        have the following fields (see section 4.2 in your contract for a full
        description of each service). Fill with spaces if there were no units of
        service provided. Right justify all fields unless noted otherwise. For
        charges, include actual

                             Attachment I- 43 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        amounts for Medicaid (co-pays, payments for non-Medicare covered
        services). All "Hours" fields should be accurate to the nearest quarter
        hour (.25). Please be sure to enter the hours as a decimal (e.g., 2.5 is
        two and a half hours; .25 is a quarter hour).

<TABLE>
<CAPTION>
                                                           UNIT OF                      START    END
FIELD NAME      DESCRIPTION                                MEASUREMENT      LENGTH      COL.     COL.   TEXT/NUMBER
--------------------------------------------------------------------------------------------------------------------
<S>             <C>                                        <C>               <C>        <C>      <C>    <C>
SSN             Social Security Number (left justify)      000000000         9           1        9     N

                Medicaid ID Number

MENTAL          Mental Health Services                     Hours             8          26       33     N
                                                           (00000.00)

DENTAL          Dental Services including dentures         Charges           9          34       42     N
                                                           (000000.00)

HEARING         Hearing Services including hearing aids    Charges           9          43       51     N
                                                           (000000.00)

HOME            Home Health Care Services                  Hours             8          52       59     N
                                                           (00000.00)

LABXRAY         Independent Laboratory or Portable         Charges           9          60       68     N
                X-ray Services                             (000000.00)

INPATIENT       Inpatient Hospital Services, including     Charges           9          69       77     N
                E/R that is admitted                       (000000.00)

OUTPATIENT      Outpatient Hospital Services including     Charges           9          78       86     N
                E/R not admitted to inpatient              (000000.00)

PHYSICIAN       Physician Services                         Charges           9          87       95     N
                                                           (000000.00)

PRESCRIP        Prescribed Drug Services                   Charges           9          96      104     N
                                                           (000000.00)

VISUAL          Visual Services including eyeglasses       Charges           9         105      113     N
                                                           (000000.00)

TRANS           Transportation services (not included in   Trips             5         114      118     N
                Escort services)
</TABLE>

A file with DME and Consumable Supplies should be provided as an ASCII fixed
length text file, one record per enrollee, per medical supply code, per line.
Internal codes provided in the Durable Medical Equipment-Medical Supplies
handbook should be used. The handbook may be accessed from the agency's website
as follows:

http://floridamedicaid.consultee-inc.com
Choose Provider Support
Choose Handbooks
Choose Durable Medical Equipment-Medical Supplies (PDF file)

For contractors who use the HCFA 1500, the Medicaid Code for each supply may be
included as well but is optional. The DME/Supply list may be obtained from the
Durable Medical Equipment-Medical Supplies handbook accessible from the agency's
website as specified above.

<TABLE>
<CAPTION>
Field                                                      Unit of                      Start    End
Name            Description                                Measurement       Length     Col      Col    Text/Number
---------------------------------------------------------------------------------------------------------------------
<S>             <C>                                        <C>               <C>        <C>      <C>    <C>
SSN             Social Security Number(left                000000000          9          1        9     N
                justify)

MID             Medicaid ID Number                         0000000000        10         10       19     N

MONTH           Report Month                               MMYYYY             6         20       25     N

TYPE            1.  DME                                                       1         26       26     N
                2.  Consumable .Supply

COST            Cost of Service                            Charges            9         37       45     N
                                                           (000000.00)
</TABLE>

                             Attachment I- 44 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

8.5     GRIEVANCE REPORT

        A.      The Grievance Report provides detailed information about each
                enrollee.

        B.      Structure for Grievance Reporting File

<TABLE>
<CAPTION>
FIELD NAME        TYPE          WIDTH                   DESCRIPTION
---------------------------------------------------------------------------------------------------------------------
<S>             <C>              <C>      <C>                                   <C>
PROV-ID         Character         9       Nine digit Medicaid provider number

RECIP-ID        Character         9       The enrollee's 9 digit Medicaid ID
                                                      number

LAST-NAME       Character        15            The enrollee's last name

FIRST-NAME      Character        15            The enrollee's first name

MID-INIT        Character         1            The enrollee's middle initial

COMP-TYPE        Numeric          2                The type of complaint

DISP-DATE         Date            8            The date of the disposition

DISP             Numeric          2            The disposition of the grievance

                                          1. Referral Made to Specialist        10.  In Contractor Grievance Process
                                          2. PCP Appointment Made               11.  Referred to Area Agency on Aging
                                          3. Bill Paid                          12.  Enrollee Sent OLC form
                                          4. Procedure Scheduled                13.  Lost Contact with Enrollee
                                          5. Reassigned PCP                     14.  Hospitalized / Institutionalized
                                          6. Reassigned Center                  15.  Contractor Complies with Contract
                                          7. Disenrolled Self                   16.  Reinstated in HMO
                                          8. Disenrolled by Plan                17.  Other
                                          9. In HMO QA Review
</TABLE>

SECTION 9       FINANCIAL REPORTING

9.      GENERAL

        The reporting requirements outlined in this section are designed in
        accordance with the agency's Medicaid prepaid plan contract financial
        reporting requirements.

9.2     AUDITED FINANCIAL STATEMENTS

        The contractor must submit annual audited financial statements which
        summarize the contractor's financial activities for the contract period.
        In addition, the contractor must annually send a statement, signed by
        the president of the organization, attesting that no assets of the
        contractor have been pledged to secure personal loans. The financial
        statements must be submitted no later than three calendar months after
        the end of the contractor's fiscal year and must be prepared by an
        independent certified public accountant on the accrual basis of
        accounting in accordance with generally accepted accounting principles
        as established by the American Institute of Certified Public Accountants
        (AICPA). Audits performed to meet the requirements of OMB Circular 128
        satisfy this requirement. For government owned and operated facilities
        operating on a cash method of accounting, data

                             Attachment I- 45 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        based on such a method of accounting will be acceptable. The certified
        public accountant (CPA) preparing the financial statements must sign
        statements as the preparer and in a separate letter state the scope of
        his work and opinion in conformity with generally accepted auditing
        standards and AICPA statements on auditing standards. The annual audited
        report will be for the contractor unless prior approval is obtained from
        the department for some other alternative.

        If the period covered by this contract is less than six months, the
        contractor may request of the department's contract manager, in writing,
        an exemption from the requirements of this section for this contract
        period. The department's contract manager will grant the exception
        provided that all other performance measures are satisfactory and the
        contractor provides a complete set of financial statements accompanied
        by an attestation of accuracy signed by a corporate officer.

9.3     UNAUDITED QUARTERLY FINANCIAL STATEMENTS

        The contractor must submit the following unaudited quarterly financial
        statements: Balance Sheet, Statement of Revenues and Expenses, and
        Statement of Changes in Financial Position and Net Worth.

        A.      These statements must be filed, on a diskette using the supplied
                spreadsheet template and are due 45 days after the end of each
                quarter in a contractor's fiscal year.

        B.      Quarterly financial reports are to be specific to the operation
                of the contractor rather than to a parent or umbrella
                organization.

        C.      The reporting date, and the name of the provider, must be
                plainly written or stamped on the certification page, along with
                the Chief Executive Officer's (CEO) signature.

        D.      Do not leave blanks. If no entry is to be made, write ANONE, @
                not applicable (N/A) or "-0-" in the space provided. Any item
                which cannot be readily classified under one of the printed
                items should be entered as an aggregated item and adequately
                described.

        E.      If additional supporting statements or schedules are added in
                connection with providing information on the financial
                statement, the additions should be properly keyed to the item
                being answered (Example - "Current Assets, #4").

        F.      One copy of the financial template is required to be filed with
                the diskette.

        G.      Minimum requirements needed to run the financial report program
                include: IBM compatible computer with an 80286 processor or
                higher, 3.5@ disk drive; hard disk drive, graphics display
                monitor EGA or VGA, 4 Mb of memory, mouse, MS-DOS 3.1 or later
                and Microsoft Windows 3.1 or later, Excel 5.0.

9.4     FINANCIAL REPORTING TEMPLATE

        The contractor will be supplied with a template for financial reporting
        that can be used with Excel or Lotus 1-2-3 spreadsheet applications. The
        spreadsheets are to be completed and the diskette mailed to the
        department.

        A.      Master financial sheet - This is the balance sheet, profit and
                loss statement and changes in financial position that reflects
                four (4) quarters plus the contractor's fiscal year totals.
                Variances have been placed within the quarters to track
                fluctuations on a line-item basis. Ratios have been created to
                monitor or detect material weaknesses in the contractor.

        B.      Enrollment sheet - Consists of quarterly summaries of enrollment
                detailed by county penetration. Indicators have been placed to
                reflect potential over or under enrolling practices.

                             Attachment I- 46 of 55

<PAGE>

                                                       Contract No. 2002-20O3-02

        C.      Profit and Loss sheets - Contains three (3) sheets to track
                individual performance by commercial, Medicare, and Medicaid
                product lines.

        D.      Aggregate write-in sheets - These four (4) sheets track any
                information recorded on the balance sheet or profit and loss
                statements, which needs further explanation.

        E.      Certification page - Showing the contractor's name, address,
                telephone number, and other elements.

9.5     Balance Sheet

        A.      Balance Sheet Asset Definitions

                1.      Current Assets - These assets are relatively liquid and
                        usually held for less than one year. Restricted assets
                        for grants, contracts and reserves are not included.
                        Five general types of assets are usually included in the
                        current asset classification.

                        a.      Cash - Money in any form, cash awaiting deposit,
                                balances on deposit in checking accounts and
                                certificates of deposit. Funds with availability
                                for current use which are restricted by
                                contract, state reserve requirements or other
                                formal arrangements are reported as Other
                                Assets. Loan funds held in escrow are reported
                                as Other Assets.

                        b.      Secondary Cash Resources - Various investments
                                that are readily marketable, held for less than
                                one year or intended for sale within a
                                twelve-month period. Any funds with availability
                                for current use but restricted by contract,
                                state requirement or other formal arrangements
                                are excluded.

                        c.      Short-Term Receivables - Open accounts
                                receivable and notes receivable with short-term
                                maturities of less than one year.

                        d.      Short-Term Prepayments - Expenses, such as
                                insurance, taxes, rent, paid for in advance of
                                use in operations. These items are usually
                                referred to as prepaid expenses.

                        e.      Other - Includes inventories that are consumable
                                supplies, such as x-ray, laboratory and other
                                operating supplies. The category includes items
                                that will be consumed by the contractor during
                                the current period in ordinary course of
                                operation and items that are held for resale
                                such as pharmacy inventories.

                2.      Other Assets - Assets including insolvency requirements,
                        contracts, grants and reserves.

                3.      Property and Equipment - Fixed assets including land,
                        building improvements, furniture and equipment.

        B.      Balance Sheet Asset Lines

                1.      Cash - Cash in the bank or on hand, available for
                        current use and does not include restricted cash.

                2.      Short-Term Investments - Readily saleable investments
                        acquired with temporarily unneeded cash and does not
                        include restricted securities.

                3.      Premiums Receivable - Net-Gross amounts collectible from
                        groups or enrollees who receive services from the
                        contractor, less the amount accrued for premiums
                        determined to be uncollectible for the period. This
                        should not include fee-for-service.

                4.      Interest Receivable - Interest earned on investments but
                        not received.

                5.      Other Receivables - Net-Gross amounts collectible from
                        sources other than enrollees or groups, less the amount
                        accrued for receivables determined to be uncollectible

                              Attachment I- 47 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                        during the period. Example: fee-for-service. This should
                        not include restricted receivables.

                6.      Prepaid Expenses - Future expenses paid in advance such
                        as unexpired insurance.

                7.      Aggregate Write-ins For Current Assets - Enter the total
                        of the write-ins listed on the aggregate write-in sheet
                        for current assets.

                8.      Total Current Assets - Total of the above categories.

                9.      Restricted Assets - Assets restricted for statutory
                        insolvency requirements.

                10.     Restricted Funds - Assets held for contract (i.e.,
                        Medicaid) grants, reserves including cash, securities,
                        receivables, and other.

                11.     Loan Escrow - Funds for which loan notes have been
                        signed by the provider but not drawn down. Funds may be
                        held by the provider or an escrow agent.

                12.     Long-Term Investments - Investments held for a period
                        longer than twelve months.

                13.     Intangible Assets and Goodwill Net - Assets of no
                        physical substance. These may include patents,
                        copyrights, licenses, and franchises. Provide gross
                        amount less amortization.

                14.     Aggregate Write-ins for Other Assets - Enter the total
                        of the write-ins listed on lines 1501 through 1597.

                15.     Total Other Assets - Total of the above categories.

                16.     Land - Real estate owned by the contractor.

                17.     Buildings & Improvements - Buildings owned by the
                        contractor and improvements made to provider-owned
                        buildings.

                18.     Construction in Progress - Buildings or improvements in
                        progress or under construction. These items will be
                        capitalized upon completion or utilization.

                19.     Furniture and Equipment - Includes medical equipment,
                        office equipment and furniture owned by the contractor.

                20.     Aggregate Write-ins for Other Equipment - Enter the
                        total of the write-ins listed on the aggregate write-in
                        for property and equipment.

                21.     Total Property and Equipment-Net - Total of Property and
                        Equipment categories, less Accumulated Depreciation. The
                        cumulative amount of depreciation on property and
                        equipment. Depreciation is an accounting practice
                        recognizing the consumption of the value of a fixed
                        asset during the asset's useful life. Depreciation
                        expenses are charged to the expense categories
                        representing the cost center to which the fixed asset is
                        assigned.

                22.     Total Assets - Total of Current Assets, Other Assets and
                        Net Property and Equipment.

                23.     Details of Write-ins Aggregated for Current Assets -
                        Show non-restricted current assets, including
                        inventories, not included in the other Current Assets
                        categories.

                24.     Details of Write-ins Aggregated for Other Assets - Show
                        non-current assets not included in the Other Assets
                        categories.

                25.     Details of Write-ins Aggregated for Other Equipment -
                        Include automobiles, fixtures, and other fixed assets
                        not reported in other Property and Equipment categories.

                             Attachment I- 48 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        C.      Balance Sheet Liabilities and Net Worth Definitions

                1.      Current Liabilities - Obligations whose liquidation is
                        reasonably expected to occur within one year. Three main
                        classes or liabilities fall within this definition.

                2.      Obligations for goods and services which were acquired
                        for use in the operating cycle - These include claims
                        for hospital and physician services and accounts
                        payable.

                3.      Other debts that may be expected to require payment
                        within the operating cycle or one year - This includes
                        short-term notes and the currently maturing portion of
                        long-term obligations.

                4.      Revenues received and recorded prior to being earned -
                        These advances are often described as "deferred
                        revenues." The obligation to furnish the services or to
                        refund the payment is recognized as a liability. These
                        include unearned premiums.

                5.      Other Liabilities - Liabilities of a long-term nature;
                        liquidation of liabilities is not expected in the
                        current year.

                6.      Net Worth - Includes ownership or donated capital,
                        restricted funds, reserves, and earnings or losses.

                7.      Balance Sheet Liabilities and Net Worth Lines.

                8.      Accounts Payable - Amounts due to creditors for the
                        acquisition of goods and services (trade and vendors
                        rather than health care providers) on a credit basis.

                9.      Claims Payable (Reported) - Claims reported and booked
                        as payables.

                10.     Accrued Inpatient Claims (Not reported) - Hospital and
                        institutional care claims incurred but not reported
                        and/or booked as payables.

                11.     Accrued Physician Claims (Not reported) - Claims
                        incurred but not reported and/or booked as payables for
                        physicians and ancillary (such as lab and x-ray)
                        services by providers under an arrangement with the
                        prepaid health plan. These may include capitation
                        payments to medical groups or fees to IPAs.

                12.     Accrued Referral Claims (Not reported) - Claims incurred
                        but not reported and/or booked as payables for
                        consultants and referrals to providers outside a
                        contractor arrangement. These claims are usually paid on
                        a fee-for-service basis.

                13.     Accrued Other Medical (Not Reported) - Other incurred
                        medical expenses but not reported and/or booked as
                        payables including emergency room, out-of-area services,
                        and payroll.

                14.     Accrued Medical Incentive Pool - Accruals for withholds
                        from IPAs or capitated medical groups and other such
                        arrangements in which the provider may return incentive
                        funds to contractors.

                15.     Unearned Premiums - Income received or booked in advance
                        of the period to which it applies. A liability exists to
                        render service in the future.

                16.     Loans and Notes Payable - The principal amount on loans
                        due within one year.

                17.     Aggregate Write-Ins for Current Liabilities - Enter the
                        total of the write-ins listed on the aggregate write-ins
                        for current liabilities.

                18.     Total Current Liabilities - Total of Current Liability
                        Categories.

                19.     Loans and Notes - Loans and notes signed by the
                        contractor not including current portion payable.
                        Include federal loans.

                20.     Statutory Liability - Reserve required as a liability by
                        statute (e.g., government purchaser requirements).

                             Attachment I- 49 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                21.     Aggregate Write-ins for Other Liabilities - Enter the
                        total of the write-ins listed on the aggregate write-ins
                        for other liabilities.

                22.     Total Other Liabilities - Total of Other Liability
                        Categories.

                23.     Total Liabilities - Lines 11 and 15.

                24.     Donated Capital - Capital donated to nonprofit
                        organization. Do not include loans. Describe the nature
                        of donation as well as any restrictions on this capital
                        in the notes to financial statements.

                25.     Capital - Par Value of stock. Stated amount of owners's
                        direct equity in provider.

                26.     Paid in Surplus - Amount over stated value of Line 17.
                        Reflects actual amount in excess of par or stated value.

                27.     Unassigned Surplus - Unassigned Retained Earnings.
                        Cumulative earnings or deficit from operations, net of
                        reserves and restricted funds.

                28.     Aggregate Write-ins for Other Net Worth Items - Enter
                        the total of the write-ins listed on the aggregate
                        write-ins for net worth.

                29.     Total Net Worth - Total of Lines 16 to 20.

                30.     Total Liabilities and Net Worth - Total of Lines 16 and
                        22.

                31.     Details of Write-ins Aggregated for Current Liabilities
                        - Show current liabilities not included in other Current
                        Liabilities categories; include accrued payroll and
                        taxes.

                32.     Details of Write-ins Aggregated for Other Liabilities -
                        Show other liabilities of a long-term nature.

                33.     Details of Write-ins Aggregated for Other Net Worth
                        Items - May include statutory reserves, subordinated
                        debt, and accrued interest on subordinated debt.

9.6     STATEMENT OF REVENUES, EXPENSES, AND NET WORTH

        A.      Revenue: components are broken down to show the sources of
                income and revenue dependency on public or private enrollment
                bases. Coordination of Benefits (C.O.B.) and Insurance
                Recoveries are also shown. Expenses: Medical, Services,
                Administration and Marketing components are shown. The report
                includes a contra item for year-end adjustments to the full
                expenses reported and for withholds or incentives claimed.
                Report full accrued revenues and expenses as defined below for
                the period. Full expenses, whether or not the contractor
                ultimately bears financial responsibility, should be shown. For
                example, the full hospital and institutional expenses are shown
                in "Inpatient" line. Offsets to these expenses such as C.O.B.
                and Insurance Recoveries are shown as revenue. Similarly, full
                physician service expenses are shown with a year end adjustment
                for withholds or other offsets returned to the provider as a
                contra category. Project staff should footnote differences in
                reporting if they are unable to report in lines similar to these
                revenue/expense accounts.

        B.      Statement of Revenues, Expenses, and Net Worth Lines

                1.      Premium - Revenue recognized on a prepaid basis from
                        enrollees and groups for provision of a specified range
                        of health services over a defined period of time,
                        normally one month. Also included are premiums from
                        Medicare Wrap-Around subscribers for health benefits
                        which supplement Medicare coverage. If advance payments
                        are made to the contractor for more than one reporting
                        period, the portion of the payment that has not yet been
                        earned must be treated as a liability.

                             Attachment I- 50 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                2.      Fee-for-Service - Revenue recognized by the contracting
                        entity for provision of health services to non-enrollees
                        by contractor providers and to enrollees through
                        provision of health services excluded from their prepaid
                        benefit packages.

                3.      Co-payments - Revenue recognized by the contracting
                        entity from enrollees on a utilization related basis for
                        certain health services included in the HMO benefit
                        package.

                4.      Title XVIII Medicare - Revenue as a result of an
                        arrangement between a provider and the Centers for
                        Medicare and Medicaid Services for services to a
                        Medicare beneficiary.

                5.      Title XIX Medicaid - Revenue as a result of an
                        arrangement between a contractor and a Medicaid state
                        agency for services to a Medicaid beneficiary.

                6.      Interest - Interest earned from all sources, including
                        the federal loan in escrow and reserve accounts.

                7.      C.O.B. and Insurance Recoveries - Income from
                        Coordination of Benefits and insurance recoveries.

                8.      Reinsurance Recoveries - Income from the settlement of
                        stop-loss (reinsurance) claims.

                9.      Other Revenue - Revenue from sources not covered in the
                        previous revenue accounts, such as recovery of bad debts
                        or gain on sales of capital assets.

                10.     Total Revenue - Total of the above revenue accounts.

                11.     Medical and Hospital - Expenses for health service
                        delivery including the following components:

                        a.      Physician Services - Expenses for physician
                                services provided under contractual arrangement
                                to the contractor including the following:
                                salaries, including fringe benefits, paid to
                                physicians for delivery of medical services;
                                capitated payments paid by the contractor to
                                physicians for delivery of medical services to
                                contractor subscribers; and fees paid by the
                                contractor to physicians on a fee-for-service
                                basis for delivery of medical services to
                                contractor subscribers. This includes capitated
                                referrals. Do not include expenses for medical
                                personnel time devoted to administrative tasks.

                        b.      Other Professional Services - Compensation,
                                including fringe benefits, paid by the
                                contractor to non-physician providers engaged in
                                the delivery of services and to personnel
                                engaged in activities in direct support of the
                                provision of medical services. This includes
                                dentists, psychologists, optometrists,
                                podiatrists, extenders, nurses, clinical
                                personnel such as ambulance drivers,
                                technicians, para professionals, janitors,
                                quality assurance analysts, administrative
                                supervisors, secretaries to medical personnel,
                                and medical record clerks.

                        c.      Outside Referrals - Expenses for services from
                                providers not under provider arrangement such as
                                consultations.

                        d.      Emergency Room, Out-of-Area, Other - Expenses
                                for other non-contracted health delivery
                                services incurred by contractor enrollees for
                                which the contractor is responsible on a
                                fee-for-service basis. These include emergency
                                room costs and out-of-area emergency physician
                                and hospital costs.

                        e.      Occupancy, Depreciation and Amortization -
                                Expenses associated with medical services
                                including the amount of depreciation and
                                amortization

                             Attachment I- 51 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                                expense which is directly associated with the
                                delivery of medical services. The costs of
                                occupancy to the contractor which are directly
                                associated with the delivery of medical
                                services. Included in occupancy are costs of
                                using a facility, fire and theft insurance,
                                utilities, maintenance, and lease.

                        f.      Inpatient - Inpatient hospital costs of routine
                                and ancillary services for enrollees while
                                confined to an acute care hospital. Does not
                                include out-of-area hospitalization.

                        g.      Routine hospital service includes regular room
                                and board (including intensive care units,
                                coronary care units, and other special inpatient
                                hospital units), dietary and nursing services,
                                medical surgical supplies, medical social
                                services, and the use of certain equipment and
                                facilities for which the contractor does not
                                customarily make a separate charge.

                        h.      Ancillary services may also include laboratory,
                                radiology, drugs, delivery room and physical
                                therapy services. Ancillary services may also
                                include other special items and services for
                                which charges are customarily made in addition
                                to routine service charge. Charges for
                                non-contractor physician services provided in a
                                hospital are included in this line item only if
                                included as an undefined portion of charges by a
                                hospital to the contractor. Include the cost of
                                utilizing skilled nursing and intermediate care
                                facilities. Skilled nursing facilities are
                                primarily engaged in providing skilled nursing
                                care and related services for patients who
                                require medical or nursing care or
                                rehabilitation service. Intermediate care
                                facilities are for enrollees who do not require
                                the degree of care and treatment which a
                                hospital or nursing care facility provides, but
                                do require care and services above the level of
                                room and board.

                        i.      Reinsurance Expenses - Expenses for Reinsurance
                                or "Stop-loss" insurance.

                        j.      Other Medical - Costs directly associated with
                                the delivery of medical services under
                                contractor arrangement which are not
                                appropriately assigned to the medical expense
                                categories defined above, e.g., costs of medical
                                supplies, medical administration expense (except
                                compensation), malpractice insurance, etc.

                        k.      Incentive Pool Adjustment - A contra category
                                for adjusting the full medical expenses
                                reported. For example, physician withholds or
                                hospital volume discounts returned by or to the
                                provider should be included here. Adjustments
                                should be made only on the annual report.

                        l.      Total Medical and Hospital - Total of the above
                                categories.

        C.      Administration - Costs associated with the overall management
                and operation of the contractor including the following
                components:

                        1.      Compensation - All expenses for administrative
                                services including compensation and fringe
                                benefits for personnel time devoted to or in
                                direct support of administration. Include
                                expenses for management contracts. Do not
                                include marketing expenses. However, when a
                                management company pays rent, insurance, and
                                other non-salary or non-commission payments,
                                these amounts should not be reported as
                                compensation.

                        2.      Interest Expenses - Interest on loans paid
                                during period.

                        3.      Occupancy, Depreciation and Amortization -
                                Expenses associated with administrative services
                                including the costs of occupancy to the
                                contractor entity which are directly associated
                                with contractor administration. Included in
                                occupancy are costs of using a facility, fire
                                and theft insurance,

                             Attachment I- 52 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

                                utilities, maintenance, and lease. Do not
                                include expenses for marketing in this category.

                        4.      The amount of depreciation and amortization
                                expense which is directly associated with
                                administrative services. Depreciation expense is
                                the incremental consumption of the value of a
                                fixed asset during the asset's useful life.

                        5.      Amortization Expense - the cost of certain
                                assets are spread over their estimated service
                                lives. e.g., leasehold improvements.

                        6.      Marketing - Expenses directly related to
                                marketing activities including advertising,
                                printing, marketing representative compensation
                                and fringe benefits, commissions, broker fees,
                                travel, occupancy, and other expenses allocated
                                to the marketing activity.

                        7.      Other - Costs which are not appropriately
                                assigned to the health plan administration
                                categories defined above. Included are costs to
                                update enrollee records, servicing of enrollee
                                inquiries and complaints, claims adjudication
                                and payment, legal, audit, data processing,
                                accounting, insurance, bad debts, and all taxes
                                except federal income taxes. Do not include
                                marketing expenses.

                        8.      Total Administration - Total of the above
                                categories.

                        9.      Total Expenses - Total of Medical and Hospital
                                and Administration Expenses.

                        10.     Income (Loss) - Excess or deficiency of total
                                revenues over total expenses.

                        11.     Extraordinary Item - A nonrecurring gain or loss
                                that meets the following criteria:

                                a.      The event must be unusual. It should be
                                        highly abnormal and unrelated to, or
                                        only incidentally related to, the
                                        ordinary activities of the entity.

                                b.      The event must occur infrequently. It
                                        should be of a type that would not
                                        reasonably be expected to recur in the
                                        foreseeable future.

                                c.      The following gains and losses are
                                        specifically not extraordinary: write-
                                        down or write-off of accounts
                                        receivable, inventory, or intangible
                                        assets; gains or losses from changes in
                                        the value of foreign currency; gains or
                                        losses on disposal of a segment of a
                                        business; gains or losses from the
                                        disposal of fixed assets; effects of a
                                        strike; and adjustments of accruals on
                                        long-term contracts.

                        12.     Provision for taxes - State and federal taxes
                                for the period (for-profit organizations only).

                        13.     Net Income (Loss) - Excess or deficiency of
                                total revenues over total expenses less state
                                and federal taxes for the period.

9.7     STATEMENT OF CHANGES IN FINANCIAL POSITION AND NET WORTH

        A.      This report reflects the concept of funds as working capital,
                rather than the more limited cash concept. Use brackets to show
                negative balances. Inclusion of statutory reserves as a
                component of working capital is dependent in each situation on
                the use of the reserve as defined by the regulatory authority.
                The applicable test is whether the reserve is available for use
                in current operations. This report shows funds generated and
                applied to operations. Sources and applications of funds
                indicate funds generated (or lost) from operations, as well as
                other sources and applications. Net worth indicates changes in
                components of net worth over the past year. Sources of funds
                used in operations including the following:

                             Attachment I- 53 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        B.      Statement of Changes in Financial Position and Net Worth Lines

                1.      Net Income (Loss) - Report the figure calculated for
                        this line.

                2.      Add items not affecting working capital in the current
                        period - depreciation, amortization and deferred taxes
                        are expenses not affecting working capital. These
                        expenses are added back.

                3.      Depreciation and Amortization

                4.      Deferred Taxes - These are accrued taxes expensed for
                        the period which are held for payment to the government
                        during a later period.

                5.      Show other expenses not affecting working capital.

                6.      Other Additions to Working Capital: Additions are
                        generally from borrowing or from liquidating non-current
                        assets and include the following:

                        a.      Proceeds from borrowing - Additions from
                                borrowing which increase current asset accounts.

                        b.      Show other additions to working capital.

                        c.      Total Sources of Funds - Total of the above
                                categories.

                7.      Applications - Uses of Working Capital, usually
                        additions to non-current assets or reductions in long
                        term liabilities, including the following:

                        a.      Additions to Property and Equipment - Increase
                                in property and equipment from last period.

                        b.      Reductions in Long-Term Debt - Decrease in
                                long-term liabilities from last period.

                        d.      Show other uses of Working Capital.

                        e.      Total Applications of Funds - Total of the above
                                categories.

                8.      Increase (Decrease) in Working Capital - Excess or
                        deficiency of Sources over Applications of Funds.

                9.      Net Worth Beginning of Period

                10.     Increase (Decreases) in Donated Capital

                11.     Increase (Decrease) in Capital - (Current year less
                        previous year)

                12.     Increase (Decrease) in Reserves and Restricted Funds -
                        (Current year less previous year)

                13.     Increase (Decrease) in Unassigned Surplus - (Current
                        year less previous year)

                14.     Net Worth End of Period

SECTION 10      PAYMENT

10.1    PAYMENT TO CONTRACTOR

        The funds provided in this contract are identified in CFDA #93.778. The
        agency, through the Medicaid fiscal agent, will make a fixed rate
        payment, not to exceed the amount set forth in Attachment IV, to the
        contractor on a monthly basis for the contractor's satisfactory
        performance of its duties and responsibilities as set forth in the
        contract. The capitation rate will have two components: 1) a payment for
        medical care and 2) a payment for long-term care services.

                             Attachment I- 54 of 55

<PAGE>

                                                       Contract No. 2002-2003-02

        CAPITATION RATES

        A.      The medical care payment component is developed using the
                Medicaid fee-for-service claims experience of Medicaid
                enrollees aged 65 or older and who were assessed by CARES staff
                to meet nursing home level of care.

        B.      The long-term care payment component is developed using the
                Social Services Estimating Conference figure for the statewide
                average cost of nursing home care less patient responsibility.

        C.      The capitation rate to be paid will be as indicated in
                Attachment IV and may be re-calculated at least annually prior
                to the beginning of each state fiscal year.

        D.      The capitation rate to be paid will not exceed that amount which
                would have been paid, on an aggregate basis, by Medicaid under
                fee-for-service for the same services to a demographically
                similar population of enrollees.

10.3    PAYMENT IN FULL

        Unless otherwise specified in this contract, the contractor must accept
        the capitation payment received each month as payment in full for all
        services provided to enrollees covered under this contract and the
        administrative costs incurred by the contractor in providing or
        arranging for such services.

10.4    CAPITATION RATE ADJUSTMENTS

        The contractor and the agency acknowledge that the capitation rate paid
        under this contract as specified in Attachment IV of this contract, is
        subject to approval by the federal government.

        A.      Adjustments to funds previously paid and to be paid may be
                required. Funds previously paid will be adjusted when capitation
                rate revisions are the result of legislatively mandated changes
                in Medicaid services, when capitation rate calculations are
                determined to have been in error, or an error is made in
                enrolling an ineligible person. In such events, the contractor
                agrees to refund any overpayment and the agency agrees to pay
                any underpayment.

        B.      The agency agrees to reflect changes in the Medicaid
                fee-for-service program. The rate of payment and total dollar
                amount may be adjusted with a properly executed amendment when
                Medicaid fee-for-service expenditure changes have been
                established through the appropriations process and subsequently
                identified in the agency's operating budget. Legislatively
                mandated changes will take effect on the dates specified in the
                legislation.

        Payment Errors

        If after preparation and electronic submission, a contractor error is
        discovered either by the contractor or the agency, the contractor has
        ten (10) business days to correct the error and resubmit accurate
        reports and/or invoices. Failure to respond within the ten (10) business
        day period may result in a loss of any money due the contractor.

                             Attachment I- 55 of 55

<PAGE>

                                                                   Attachment II

                        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 an employee of any agency, a member of
        Congress, an officer or employee of Congress, or an employee of a member
        of Congress in the 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 an employee of any agency, a member of Congress, an
        officer or employee of Congress, or an employee of a member of Congress
        in the 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 sub-awards at all tiers
        (including subcontracts, sub-grants and contracts under grants, loans
        and cooperative agreements) and that all sub-recipients 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/ Miguel B. Fernandez                                      6-25-02
---------------------------------                 ------------------------------
Signature                                         date

/s/ Miguel B. Fernandez                                   2002-2003-02
---------------------------------                 ------------------------------
name of authorized individual                     Application or Contract Number

Physicians Healthcare Plans, Inc.
---------------------------------
name of organization

55 Alhambra, 7th Floor,
Cotal Gables, Fl. 33134
--------------------------------
address of organization

                                                                     Page 1 of 1

<PAGE>

                                                                  Attachment III

                                                                     Page 1 of 2

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

        Each recipient or vendor whose contract equals or exceeds $100,000 in
        federal monies must sign this debarment certification prior to contract
        execution. Independent auditors who audit federal programs regardless of
        the dollar amount are required to sign a debarment certification form.
        Neither the Department of Elder Affairs nor its contract recipients or
        vendors can contract with subrecipients if they are debarred or
        suspended by the federal government.

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

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

4.      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 and 45 CFR (Code of Federal
        Regulations), Part 76. You may contact the contract manager for
        assistance in obtaining a copy of those regulations.

5.      The recipient or vendor further 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 unless authorized by the Federal
        Government.

6.      The recipient or vendor further agrees by submitting this certification
        that it will require each subrecipient of this contract whose payment
        will equal or exceed $100,000 in federal monies, to submit a signed copy
        of this certification with each contract.

7.      The Department of Elder Affairs and its contract recipients or vendor
        may rely upon a certification of a recipient/subrecipients that is not
        debarred, suspended, ineligible, or voluntarily exclude from
        contracting/subcontracting unless it knows that the certification is
        erroneous.

8.      If the recipient or vendor is an Area Agency on Aging (AAA), the AAA may
        rely upon a certification of a recipient/subrecipient or vendor entity
        that is not debarred, suspended, ineligible, or voluntarily excluded
        from contracting/subcontracting unless the AAA knows that the
        certification is erroneous.

9.      The signed certifications of all subrecipients or vendors shall be kept
        on file with recipient.

<PAGE>

                                                                  Attachment III

                                                                     Page 2 of 2

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

This certification is required by the regulation 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).

(1)     The prospective recipient or vendor 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 contracting with the Department of Elder
        Affairs by any federal department or agency.

(2)     Where the prospective recipient or vendor is unable to certify to any of
        the statements in this certification, such prospective recipient or
        vendor shall attach an explanation to this certification.

Signature            /s/ Miguel B. Fernandez
         ----------------------------------------
Date 6-25-02
    ---------------------------------------------

/s/ Miguel B. Fernandez, Chief Executive Officer
-------------------------------------------------
Name and Title of Authorized Individual
(Print or type)

Physicians Healthcare Plans, Inc.
---------------------------------
Name of Organization

<PAGE>

                                                                   Attachment IV

                                     PAYMENT

The contractor will be paid a monthly capitation rate in accordance with the
following table:

TABLE 1

Long-Term Care Community Diversion Pilot Project Capitation Rate  $    2342.41

                                                                     Page 1 of 1

<PAGE>

                                                                    Attachment V
                                                                   (Page l of 4)

                         FINANCIAL AND COMPLIANCE AUDIT

The administration of resources awarded by the Agency for Health Care
Administration to the recipient may be subject to audits and/or monitoring by
the Agency as described in this section.

MONITORING

In addition to reviews of audits conducted in accordance with OMB Circular A-133
and Section 215.97, F.S., as revised (see "AUDITS" below), monitoring procedures
may include, but not be limited to, on-site visits by Agency staff, limited
scope audits as defined by OMB Circular A-133, as revised, and/or other
procedures. By entering into this agreement, the recipient agrees to comply and
cooperate with any monitoring procedures/processes deemed appropriate by the
Agency. In the event the Agency determines that a limited scope audit of the
recipient is appropriate, the recipient agrees to comply with any additional
instructions provided by the Agency to the recipient regarding such audit. The
recipient further agrees to comply and cooperate with any inspections, reviews,
investigations, or audits deemed necessary by the Comptroller or Auditor
General.

AUDITS

PART I: FEDERALLY FUNDED

This Attachment is applicable if the recipient is a State or local government or
a non-profit organization as defined in OMB Circular A-133, as revised.

        In the event that the recipient expends $300,000 or more in Federal
        awards in its fiscal year, the recipient must have a single or
        program-specific audit conducted in accordance with the provisions of
        OMB Circular A-133, as revised. PART VI of this agreement indicates
        Federal resources awarded through the Agency. In determining the Federal
        awards expended in its fiscal year, the recipient shall consider all
        sources of Federal awards, including Federal resources received from the
        Agency. The determination of amounts of Federal awards expended should
        be in accordance with the guidelines established by OMB Circular A-133,
        as revised. An audit of the recipient conducted by the Auditor General
        in accordance with the provisions of OMB Circular A-133, as revised,
        will meet the requirements of this part.

2.      In connection with the audit requirements addressed in Part I, paragraph
        1., the recipient shall fulfill the requirements relative to auditee
        responsibilities as provided in Subpart C of OMB Circular A-133, as
        revised.

3.      If the recipient expends less than $300,000 in Federal awards in its
        fiscal year, an audit conducted in accordance with the provisions of OMB
        Circular A-133, as revised, is not required. In the event that the
        recipient expends less than $300,000 in Federal awards in its fiscal
        year and elects to have an audit conducted in accordance with the
        provisions of OMB Circular A-133, as revised, the cost of the audit must
        be paid from non-Federal resources (i.e., the cost of such an audit must
        be paid from recipient resources obtained from other than Federal
        entities).

4.      Information concerning this section can be found on the Federal Office
        of Management and Budget Web page at: http://www.whitehouse.gov/omb/
        index

PART II: STATE FUNDED

This part is applicable if the recipient is a nonstate entity as defined by
Section 215.97(2)(1), Florida Statutes.

        In the event that the recipient expends a total amount of State
        Financial Assistance (i.e., State financial assistance provided to the
        recipient to carry out a State project) equal to or in excess of
        $300,000 in any fiscal year of such recipient, the recipient must have a
        State single or project-specific audit for such fiscal year in
        accordance with Section 215.97, Florida Statutes; applicable rules of
        the Executive Office of the Governor and the Comptroller, and Chapters
        10.550 (local governmental entities) or 10.650 (nonprofit and for-profit
        organizations), Rules of the Auditor General. PART VI of this agreement
        indicates State Financial Assistance awarded through the Agency by this
        agreement. In determining the State Financial Assistance expended in its
        fiscal year, the recipient shall consider all sources of State Financial
        Assistance, including State Financial Assistance received from the
        Agency, other state agencies, and other nonstate entities. State
        Financial Assistance does not include Federal direct or pass-through
        awards and resources received by the nonstate entity for Federal program
        matching requirements.

<PAGE>

                                                                    Attachment V
                                                                   (Page 2 of 4)

2.      In connection with the audit requirements addressed in Part II,
        paragraph 1, the recipient shall ensure that the audit complies with the
        requirements of Section 215.97(7), Florida Statutes. This includes
        submission of a financial reporting package as defined by Section
        215.97(2)(d), Florida Statutes, and Chapters 10.550 (local governmental
        entities) or 10.650 (nonprofit and for-profit organizations), Rules of
        the Auditor General.

3.      If the recipient expends less than $300,000 in State Financial
        Assistance in its fiscal year, an audit conducted in accordance with the
        provisions of Section 215.97, Florida Statutes, is not required. In the
        event that the recipient expends less than $300,000 in State Financial
        Assistance in its fiscal year and elects to have an audit conducted in
        accordance with the provisions of Section 215.97, Florida Statutes, the
        cost of the audit must be paid from the nonstate entity's resources
        (i.e., the cost of such an audit must be paid from the recipient's
        resources obtained from other than State entities).

4.      Information concerning this section can be found on the State of Florida
        Web page at:
        http://www.myflorida.com/myflorida/government/govermorinitiatives/fsaa/

PART III: OTHER AUDIT REQUIREMENTS

        45 CFR, Part 74.26(d) extends OMB requirements, as stated in Part I
        above, to for-profit organizations.

PART IV: REPORT SUBMISSION

        Copies of reporting packages for audits conducted in accordance with OMB
        Circular A-133, as revised, and required by PART I of this agreement
        shall be submitted, when required by Section .320 (d), OMB Circular
        A-133, as revised, by or on behalf of the recipient directly to each of
        the following:

        A.      The Agency for Health Care Administration at the following
                address:

                        See AHCA Standard Contract document, Section III,C,1

        B.      The Federal Audit Clearinghouse designated in OMB Circular
                A-133, as revised (the number of copies required by Sections
                .320 (d)(l) and (2), OMB Circular A-133, as revised, should be
                submitted to the Federal Audit Clearinghouse), at the following
                address:

                        Federal Audit Clearinghouse
                        Bureau of the Census
                        1201 East 10th Street
                        Jeffersonville, IN 47132

        C.      Other Federal agencies and pass-through entities in accordance
                with Sections .320 (e) and (f), OMB Circular A-133, as revised.

2.      Pursuant to Section .320 (f), OMB Circular A-133, as revised, the
        recipient shall submit a copy of the financial reporting package
        described in Section .320 (c), OMB Circular A-133, as revised, and any
        management letters issued by the auditor, to the Agency at the following
        address:

        A.      The Agency for Health Care Administration at the address
                indicated in the Standard Contract document, Section III,C,1.

        B.      To the Federal Agency or pass-through entity making the request
                for a copy of the reporting package.

        Copies of financial reporting packages required by PART II of this
        agreement shall be submitted by or on behalf of the recipient directly
        to each of the following:

        A.      The Agency for Health Care Administration at the address
                indicated in the Standard Contract document, Section III,C,l.

        B.      The Auditor General's Office at the following address:

                        Auditor General's Office
                        Room 401, Pepper Building
                        111 West Madison Street
                        Tallahassee, Florida 32399-1450

<PAGE>

                                                                    Attachment V
                                                                   (Page 3 of 4)

4.      Copies of reports or management letters required by PART III of this
        agreement shall be submitted by or on behalf of the recipient directly
        to:

        A.      The Agency for Health Care Administration at the address
                indicated in the Standard Contract document, Section III,C,l.

        B.      The Federal Department of Health and Human Services

                        National External Audit Resources Unit
                        323 West 8th St., Lucas Place-Room 514
                        Kansas City, MO 64105.

        C.      The Federal Audit Clearinghouse designated in OMB Circular
                A-133, as revised (the number of copies required by Sections
                .320 (d)(1) and (2), OMB Circular A-133, as revised, should be
                submitted to the following address:

                        Federal Audit Clearinghouse
                        Bureau of the Census
                        1201 East 10th Street
                        Jeffersonville, IN 47132

5       Any reports, management letters, or other information required to be
        submitted to the Agency pursuant to this agreement shall be submitted
        timely in accordance with OMB Circular A-133, Florida Statutes, and
        Chapters 10.550 (local governmental entities) or 10.650 (nonprofit and
        for-profit organizations), Rules of the Auditor General, as applicable.

6       Recipients, when submitting financial reporting packages to the Agency
        for audits done in accordance with OMB Circular A-133, or Chapters
        10.550 (local government entities) or 10.650 (nonprofit and for-profit)
        organizations, Rules of the Auditor General, should indicate the date
        that the reporting package was delivered from the auditor to the
        recipient in correspondence accompanying the reporting package. This can
        be accomplished by providing the cover letter from the reporting package
        received from the auditor or a cover letter indicating the date the
        reporting package was received by the recipient.

PART V:  RECORD RETENTION

        The recipient shall retain sufficient records demonstrating its
        compliance with the terms of this agreement for a period of five (5)
        years from the date the audit report is issued, and shall allow the
        Agency or its designee, Comptroller, or Auditor General access to such
        records upon request. The recipient shall ensure that audit working
        papers are made available to the Agency or its designee, Comptroller, or
        Auditor General upon request for a period of five (5) years from the
        date the audit report is issued unless extended in writing by the
        Agency.

NOTE:   Section .400(d) of the OMB Circular A-133, as revised, and Section
        215.97(5)(a), Florida Statutes, require that the information about
        Federal Programs and State Projects included in Part VI of this
        attachment be provided to the Provider organization if the Provider is
        determined to be a recipient. If Part VI is not included the Provider
        has not been determined to be a recipient as defined by the above
        referenced federal and state laws.

<PAGE>

                                                                    Attachment V
                                                                   (Page 4 of 4)

PART VI:  SCHEDULE OF FEDERAL AND STATE FUNDING

(Mandatory to be completed by Agency Contract Manager and included as part of
Attachment II, if Provider is determined to be a recipient of either state or
federal financial assistance as defined in the OMB Circular A-133 as revised or
Section 2l5.97(2)(m) F.S. Contract Managers should utilize the Federal funding
checklist to determine the Provider's status per OMB Circular A-133 or the
Florida Single Audit Act Checklists to determine the applicability and
Provider's status per Section 215.97, F.S.)

1.      Compliance requirements for Federal Financial Assistance, State Matching
        and State Financial Assistance awarded pursuant to this agreement are
        included in the Agency Standard Contract document and the Attachment I,
        Special Provisions section.

        a)      Federal Financial Assistance awarded to the recipient pursuant
                to this agreement are as follows:
                (Check appropriate Federal Program funding source(s) and provide
                amount per source.)

                Department of Health and Human Services, Center for
                Medicaid/Medicare

                  [X]Medicaid Title 19(CFDA# 93.778)          Amount: $
                  Medical Assistance Payments

                  [ ]Medicaid Title 21(CFDA# 93.767)          Amount: $
                  Children's Health Insurance program

                  [ ]Medicaid Title 18,19,CLIA
                  Survey and Certification(CFDA# 93.777)      Amount: $

        b)      State matching funds awarded to the Recipient pursuant to this
                agreement are as follows:
                (Check appropriate Federal Program funding source and provide
                State matching amount per source.)

                Department of Health and Human Services, Center for
                Medicaid/Medicare

                  [ ]Medicaid Title 19(CFDA# 93.778)          Amount: $
                  Medical Assistance Payments

                  [ ]Medicaid Title 21(CFDA# 93.767           Amount: $
                  Children's Health Insurance Program

                  [ ]Medicaid Title 18,19, CLIA (CFDA# 93.777)
                  Survey and Certification                    Amount: $

        c)      State Financial Assistance awarded pursuant to Section 215.97,
                F.S., Florida Single Audit Act
                (If this section is checked provide CSFA #)

                  [ ]State Project     (CSFA#                 Amount: $
                  State Project Title:

<PAGE>

                                                                   Attachment VI
                                                                   (Page 1 of 2)

                                  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 (HIPAA)

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

                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.
                Section 164.501, limited to the information created or received
                by the Provider from or on behalf of the Agency.

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

        3.      Use and Disclosure of Information for Management,
                Administration, and Legal Responsibilities. The Provider is
                permitted to use and disclose Protected Health Information
                received from the Agency for the proper management and
                administration of the Provider or to carry out the legal
                responsibilities of the Provider, in accordance with 45 C.F.R.
                164.504(e)(4). Such disclosure is only permissible where
                required by law, or where the Provider 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 Provider 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 Provider 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
                Provider on behalf of, the Agency. Such subcontract shall
                contain the same terms, conditions, and restrictions that apply
                to the Provider with respect to Protected Health Information.

        5.      Access to Information. The Provider 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.

                Amendment and Incorporation of Amendments. The Provider 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. Section 164.526.

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

<PAGE>

                                                                   Attachment VI
                                                                   (Page 2 of 2)

        8.      Access to Books and Records. The Provider 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 Provider on behalf of, the Agency 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 contract, the Provider
                shall return all Protected Health Information that the Provider
                still maintains in any form, including any copies or hybrid or
                merged databases made by the Provider; or with prior written
                approval of the Agency, the Protected Health Information may be
                destroyed by the Provider after its use. If the Protected Health
                Information is destroyed pursuant to the Agency's prior written
                approval, the Provider must provide a written confirmation of
                such destruction to the Agency. If return or destruction of the
                Protected Health Information is determined not feasible by the
                Agency, the Provider agrees to protect the Protected Health
                Information and treat it as strictly confidential.

                In witness whereof, the Provider and the Agency have caused this
                Certification to be signed and delivered by their duly
                authorized, representatives, as of the date set forth below

<TABLE>
                <S>                                     <C>
                Provider                                State of Florida, Agency for Health Care
                By: /s/ Miguel B. Fernandez             Administration
                   -----------------------------
                Print Name: Miguel B. Fernandez         By:  /s/ [ILLEGIBLE]
                           ----------------------          ---------------------------------
                Title: Chief Executive Officer          Print Name: [ILLEGIBLE]
                       --------------------------                  -------------------------
                Date: 6-25-02                           Title: [ILLEGIBLE]
                      ---------------------------              -----------------------------
                                                        Date: 6/27/02
                                                            -------------------------------
</TABLE>

<PAGE>


                                  AMENDMENT #1

THIS AMENDMENT, entered into between the State of Florida, Department of Elder
Affairs hereinafter referred to as the "department," the Agency for Health Care
Administration hereinafter referred to as the "agency," and Amerigroup Florida,
Inc. (formerly Physicians Healthcare Plans, Inc.), hereinafter referred to as
the "contractor," amends contract number 2002-2003-02.

1.   Section III.D.2 is hereby amended to read:

     The name, address and telephone number of the representative for the
     agency:

     Elizabeth Y. Kidder
     Agency for Health Care Administration
     2727 Mahan Drive
     Mail Stop 20
     Tallahassee, Florida 32308
     (850) 922-7349

2.   Section III.G is hereby amended to read

     This contract and Attachments I, II, III, IV, V, VI, and Exhibits A, B, and
     C as referenced, contain all terms and conditions agreed upon by the
     parties.

3.   Attachment I, Section 10 is hereby amended to add

     If the contractor wishes to terminate a subcontract with an Assisted Living
     Facility or a Nursing Facility in which any of its project enrollees are
     currently residing, written notice must be provided to the other parties to
     this agreement at least ten (10) calendar days prior to notifying the
     subcontractor of its intent to terminate. This requirement is waived if the
     facility is not licensed or the Department or Agency waives the notice
     period.

4.   Attachment I, Section 4.1.G.8 is hereby amended to read

     Services must be delivered by qualified providers as defined in sections
     4.4, 4.5, 4.6, and 4.7. The contractor must have a credentialing system
     approved by an accreditation organization that has been approved by the
     agency pursuant to Section 641.512, Florida Statutes. The system must
     include procedures for credentialing long-term care providers.

5.   Attachment I, Section 4.2.T is hereby amended to read:

     Nursing Facility Services: Services furnished in a health care facility
     licensed under Chapter 395 or Chapter 400 Part II, Florida Statutes.

6.   Attachment I, Section 4.4., Optional Services, is hereby amended to revise
     the following definition:

     A.   Dental Services: The contractor may choose to provide adult dental
          services as defined in the Medicaid Dental Coverage and Limitations
          Handbook.

<PAGE>

7.   Attachment I, Section 6.M is hereby deleted.

8.   Attachment I, Section 8.1.A.3 is hereby amended to read:

     Contractor Level - One report is required for each seven-digit Medicaid
     provider number the contractor has under contract.

     Example: ABC Health Plan, Medicaid Provider Number 1234567, operates three
     locations: ABC of Palm Beach (123456701), ABC of Indian River (123456702),
     and ABC of Martin (123456703). A contractor level report would be
     summarized over all plans with the seven-digit Medicaid Provider number
     (1234567). A location level report would have one report for each
     nine-digit provider number (123456701, 123456702, and 123456703).

     The following table summarizes the required data reporting for the project:

<TABLE>
<CAPTION>
                          LEVEL OF        REPORTING          SUBMISSION      REPORTING
      REPORT NAME         ANALYSIS        FREQUENCY            METHOD         LOCATION
     ----------------------------------------------------------------------------------
     <S>                 <C>         <C>                  <C>                <C>
     Enrollment,         Location    Monthly, by 5:00     Asynchronous       Fiscal
     Disenrollment, and              PM on the            Transfer           Agent
     Cancellation                    Wednesday
     Report for Payment              preceding the
                                     second to last
                                     Saturday

     Enrollment and      Location    Monthly within 5     Electronic Mail,   Department
     Disenrollment                   calendar days after  Facsimile,
     Report                          the beginning of     Compact Disc,
                                     the reporting month  Diskette, or Mail

     Encounter Data      Individual  Quarterly, within 3  Electronic Mail,   Department
     Report                          months of end of     Compact Disc, or
                                     reporting quarter    Diskette

     Grievance Report    Individual  Quarterly within 5   Electronic Mail,   Department
                                     calendar days of     Facsimile,
                                     end of reporting     Compact Disc,
                                     quarter              Diskette, or Mail

     Updated Provider    Location    Quarterly, within 5  Electronic Mail,   Department
     Network Listing                 calendar days of     Facsimile,
                                     end of reporting     Compact Disc,
                                     quarter              Diskette, or Mail

     Minority Business   Contractor  Monthly, by the      Electronic Mail,   Department
     Enterprise Contract             15th of the month    Facsimile,         and
     Report                          following the        Compact Disc,      Agency
                                     reporting month      Diskette, or Mail

     Financial           Contractor  Quarterly, within    Agency Supplied    Agency
     Statements                      45 calendar days of  Template on
                                     end of reporting     Compact Disc or
                                     quarter              Diskette

     Audited Financial   Contractor  Annually, within     Electronic Mail,   Agency
     Statements                      90 calendar days of  Compact Disc, or
                                     end of contractors'  Diskette
                                     fiscal year
</TABLE>

                                        2

<PAGE>

9.   Attachment I, Section 8.1.A.4 is hereby deleted.

10.  The format in which monthly enrollment and disenrollment information is
     reported to the Department is hereby revised. The contractor agrees to use
     the revised format beginning with the submission of enrollment and
     disenrollment information for the month of January 2003.

     Attachment I, Section 8.3 is hereby amended to read:

     ENROLLMENT AND DISENROLLMENT SUMMARY

     This report provides a uniform means of reporting each contractor's monthly
     enrollments and disenrollments. The report is required to track enrollment
     and assess the reasons for each disenrollment, and to ensure that
     disenrollments are in compliance with contract guidelines.

     This report must be provided as a Microsoft Excel spreadsheet in the format
     specified in Exhibit A of this contract. Enrollments and disenrollments
     shall be numbered, and information shall be listed in alphabetized
     ascending order by enrollee last name, then by enrollee first name.
     Information shall pertain only to enrollments or disenrollments that are
     effective for the month being reported. For example, the November 2002
     report of disenrollments would include information on an enrollee that
     expired on October 28, 2002. October 28, 2002 would be provided as the
     Disenrollment Reason Occurrence Date for that enrollee in the Enrollment
     and Disenrollment Summary report.

11.  The format in which encounter data is reported to the Department is
     hereby revised. The contractor agrees to use the revised format beginning
     with the submission of encounter data for the quarter January through March
     2003.

     Attachment I, Section 8.4 is hereby amended to read

     ENCOUNTER DATA

     The contractor shall provide encounter level service utilization data as
     specified in Exhibit B of this contract. The services reported represent
     the comprehensive array of services that might be necessary to maintain a
     member at home while avoiding nursing home placement, including acute and
     long-term care services.

     These reports must be provided as ASCII, fixed length text files, with two
     files, per enrollee, per month. There will be one file for long-term care
     services and one file for acute care services. For example, if an enrollee
     were enrolled for an entire quarter, you would have three separate records
     in each of two separate files that are submitted once for the entire
     quarter. These two files, the Long-Term Care Services file and the Acute
     Care Services file, must be submitted once every quarter to the Department.

     The contractor may resubmit files with more current data during the
     subsequent reporting quarter to replace the data previously submitted. If
     files are resubmitted, the previously submitted data will be discarded, and
     the more recent data will be utilized.

                                        3

<PAGE>

     Attachment I, Section 8.5 is hereby amended to read:

     GRIEVANCE REPORT

     This report provides a uniform means of reporting each contractor's
     quarterly grievances, and is needed in order to track the number of
     grievances, as well as the reason and disposition of grievances. Grievance
     reporting provides a method by which to assess the contractor's ability to
     manage formal grievances through its internal grievance process.

     The Grievance Report must be provided as a Microsoft Excel spreadsheet in
     the format specified in Exhibit C of this contract. The Grievance Report
     shall be submitted by the contractor to report all formal grievances or
     updates to previously reported grievances, or to report whether there have
     been no new grievances during the reporting quarter.

13.  The contractor agrees to submit a quarterly updated Provider Network
     Listing beginning with the reporting quarter January through March 2003.

     Attachment I, Section 8.6 is hereby added as follows:

     PROVIDER NETWORK LISTING

     This updated listing provides current information on the contractor's
     provider network to ensure that adequate resources are available to
     enrollees at all times.

     The Provider Network Listing may be provided electronically as a Microsoft
     Word or Excel file, or as a hard copy via facsimile or mail. The Provider
     Network Listing shall be updated to include information on providers who
     joined the contractor's provider network, or who were terminated from the
     contractor's provider network during the reporting quarter.

     If the contractor has not added or terminated a subcontract to its provider
     network within the reporting quarter, a statement to that effect shall be
     provided to the Department in lieu of an updated Provider Network Listing.

14.  EXHIBIT A, Enrollment/Disenrollment Summary, is hereby made a part of the
     contract.

15.  EXHIBIT B, Encounter Data Reporting Format, is hereby made a part of the
     contract.

16.  EXHIBIT C, Report of Grievances, is hereby made a part of the contract.

     This amendment shall begin on January 21, 2003, or the date on which the
amendment has been signed by all parties, whichever is later.

     All provisions in the contract and any attachments thereto in conflict
with this amendment shall be and are hereby changed to conform to this
amendment.

                                        4

<PAGE>

     All provisions in the contract and any attachments thereto in conflict with
this amendment shall be and are hereby changed to conform to this amendment.

     All provisions not in conflict with this amendment are still in effect and
are to be performed at the level specified in the contract.

     This amendment and all its attachments are hereby made a part of the
contract.

     IN WITNESS WHEREOF, the parties hereto have caused this ten (10) page
amendment to be executed by their officials thereunto duly authorized.

CONTRACTOR:  AMERIGROUP FLORIDA, INC.        STATE OF FLORIDA
             (formerly, Physicians           DEPARTMENT OF ELDER AFFAIRS
             Healthcare Plans, Inc.)

SIGNED BY:    /s/ Imtiaz Sattaur             SIGNED BY:    /s/ Terry F White
             ----------------------                       ----------------------

NAME:             Imtiaz Sattaur             NAME:             Terry F White
             ----------------------

TITLE:          President and CEO            TITLE:            Secretary
             ----------------------

DATE:               1/31/03                  DATE:             2/11/03
             ----------------------                       ----------------------

CONTRACTOR FEDERAL ID NUMBER:
          65-0318864
-----------------------------

CONTRACTOR FISCAL YEAR ENDING DATE:
          December 31
-----------------------------------

                                              STATE OF FLORIDA
                                              AGENCY FOR HEALTH CARE
                                              ADMINISTRATION

                                              SIGNED BY : /s/ Rhonda M. Medows
                                                          ----------------------
                                              NAME:       Rhonda M. Medows, M.D.

                                              TITLE:      Secretary

                                              DATE:       2/17/03
                                                          ----------------------

                                        5

<PAGE>

                                    EXHIBIT A
                                  (Page 1 of 1)

                                   (Plan Name)
                        ENROLLMENT/DISENROLLMENT SUMMARY

                                (Reporting Month)

<TABLE>
<CAPTION>
  DISENROLLMENT
  ---------------------------------------------------------------------------------------------
                                                                                DISENROLLMENT
                                                               DISENROLLMENT  REASON OCCURRENCE
    LAST NAME     FIRST NAME  MEDICAID ID#  SOCIAL SECURITY #   REASON CODE*        DATE
  ---------------------------------------------------------------------------------------------
 <S>              <C>         <C>           <C>                <C>            <C>
 1
 2
 3
 4
 5
  ---------------------------------------------------------------------------------------------
</TABLE>

  * Disenrollment Reason Codes:

  EXP = Expired
  ELG = Lost Medicaid Eligibility
  HOS = Enrolled in Hospice

  NET = Left Provider Network
  CTY = Moved Outside of Service Area
  INV = Involuntary for Reason Other than Above

  VOL = Voluntary for Reason Other than Above
  FRD = Fraudulent Use of Medicaid or Plan ID Card
  CAN = Enrollment Cancelled Prior to Effective Date

<TABLE>
<CAPTION>
  ENROLLMENT
  ------------------------------------------------------------------------------------------------
                                                               DATE OF INITIAL  DATE OF SUBSEQUENT
   LAST NAME      FIRST NAME  MEDICAID ID#  SOCIAL SECURITY #    ENROLLMENT        ENROLLMENT **
  ------------------------------------------------------------------------------------------------
  <S>             <C>         <C>           <C>                <C>              <C>
   1
   2
   3
   4
   5
   6
   7
   8
   9
  10
  ------------------------------------------------------------------------------------------------
</TABLE>

  ** If applicable, enter the date of re-enrollment following a period of
  appropriate disenrollment

  SUMMARY

  Final Enrollment for (Previous Reporting Month):        ###
  Total New Enrollments:                                   ##
  Total Disenrollments:                                   (##)
                                                       ---------
  Final Enrollment for (Current Reporting Month):         ###
                                                       =========

                                        6

<PAGE>

SERVICE UTILIZATION REPORTING

The plan shall provide recipient-specific service utilization date in the
electronic format as specified below. The services reported represent the
comprehensive array of services that might be necessary to maintain a member at
home while avoiding nursing home placement, including acute and long-term care
services.

These reports must be provided as ASCII, fixed length text files, with two
files, per recipient, per month. There will be one file for long-term care
services and one file for acute care services. For example, if a recipient were
enrolled for an entire quarter, you would have three separate records in each of
two separate files that are submitted once for the entire quarter. These two
files, the LTC Services file and the Acute Care Services file, must be submitted
once every quarter to your DOEA/AHCA contract manager. You will have up to three
months after the last month in a specific quarter to submit the quarterly
report.

If no units of service are provided in a category or if the category is not
applicable to you, fill that field with the specified number of spaces (using
the spacebar) that match that particular field length. Right justify all fields
unless noted otherwise. For amount paid, include the sum of Medicaid and
Medicare crossover claims (deductibles and co-pays for Medicare claims).* If you
have questions about the definitions of these services please reference the
appropriate Medicaid coverage and limitations handbook for Medicaid state plan
services. Note: Please do not use commas between fields and round currency to
the nearest dollar amount.

FILE LONG-TERM CARE SERVICES

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
                                           UNIT OF           FIELD
FIELD NAME         DESCRIPTION           MEASUREMENT        LENGTH     START COL.   END COL.    TEXT/NUMERIC
--------------------------------------------------------------------------------------------------------------
<S>                <C>                 <C>                         <C> <C>                <C>          <C>
SSN                Social Security
                   Number (left
                   justify)                    000000000            9           1           9          Numeric
--------------------------------------------------------------------------------------------------------------
MEDICAID           Medicaid ID
                   Number                     0000000000           10          10          19          Numeric
--------------------------------------------------------------------------------------------------------------
ENROLL             Initial Date of
                   Program
                   Enrollment                     MMYYYY            6                      25          Numeric
--------------------------------------------------------------------------------------------------------------
DISENROL           Date of
                   Disenrollment,
                   if Applicable                  MMYYYY            6                      31          Numeric
--------------------------------------------------------------------------------------------------------------
REINST             Reinstate date                 MMYYYY            6                      37          Numeric
--------------------------------------------------------------------------------------------------------------
ALF                ALF Resident
                   Indicator                 1=Yes; 2=No            1                      38          Numeric
--------------------------------------------------------------------------------------------------------------
MONTH              Report Month                   MMYYYY            6                                  Numeric
--------------------------------------------------------------------------------------------------------------

                                       UNIT OF SERVICE/
LTC SERVICES       DESCRIPTION              COST
--------------------------------------------------------------------------------------------------------------
ADCOMP             Adult Companion
                   Services               15 Minute Unit            4          45          48          Numeric
--------------------------------------------------------------------------------------------------------------
ADAYHLTH           Adult Day
                   Health Services        15 Minute Unit            4          49          52          Numeric
--------------------------------------------------------------------------------------------------------------
ALFSVS             Assisted Living
                   Services                         Days            2          53          54          Numeric
--------------------------------------------------------------------------------------------------------------
ALFSVS$$           Assisted Living
                   Services                  Amount Paid            6          55          60          Numeric
--------------------------------------------------------------------------------------------------------------
ATTCARE            Attendant Care
                   Services               15 Minute Unit            4          61          64          Numeric
--------------------------------------------------------------------------------------------------------------
CASEAID            Case Aide              15 Minute Unit            4          65          68          Numeric
--------------------------------------------------------------------------------------------------------------
CASEMGMT           Case Management
                   (Internal)             15 Minute Unit            4          69          72          Numeric
--------------------------------------------------------------------------------------------------------------
CHORE              Chore Services         15 Minute Unit            2          73          74          Numeric
--------------------------------------------------------------------------------------------------------------
COM_MH             Community
                   Mental Health                   Visit            2          75          76          Numeric
--------------------------------------------------------------------------------------------------------------
CNMS_$$            Consumable
                   Medical Supplies          Amount Paid            6          77          82          Numeric
--------------------------------------------------------------------------------------------------------------
COUNSEL            Counseling             15 Minute Unit            4          83          86          Numeric
--------------------------------------------------------------------------------------------------------------
DME_$$             Durable Medical
                   Equipment                 Amount Paid            6          87          92          Numeric
--------------------------------------------------------------------------------------------------------------
ENVIRAA            Environmental
                   Accessibility
                   Adaptations                       Job            2          93          94          Numeric
--------------------------------------------------------------------------------------------------------------
ESCORT             Escort Services        15 Minute Unit            4          95          98          Numeric
--------------------------------------------------------------------------------------------------------------
FAMT_I             Family Training
                   Services
                   (Individual)           15 Minute Unit            2          99         100          Numeric
--------------------------------------------------------------------------------------------------------------
FAMT_G             Family Training
                   Services (Group)       15 Minute Unit            2         101         102          Numeric
--------------------------------------------------------------------------------------------------------------
FINARRS            Financial
                   Assessment
                   /Risk Reduction
                   Services               15 Minute Unit            4  [ILLEGIBLE]         106
--------------------------------------------------------------------------------------------------------------
</TABLE>

----------
* Medicare crossovers are amounts that are billed to Medicaid for those Medicaid
clients who are also eligible for Medicare.

                                        7

<PAGE>

                                    EXHIBIT B
                                  (Page 2 of 3)

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
                                           UNIT OF           FIELD
FIELD NAME        DESCRIPTION            MEASUREMENT        LENGTH     START COL.   END COL.    TEXT/NUMERIC
--------------------------------------------------------------------------------------------------------------
<S>               <C>                     <C>                       <C>       <C>         <C>          <C>
FINM RRS          Financial
                  Maintenance/Risk
                  Reduction Services      15 Minute Unit            4         107         110          Numeric
--------------------------------------------------------------------------------------------------------------
HDMEAL            Home Delivered
                  Meal                              Meal            2         111         112          Numeric
--------------------------------------------------------------------------------------------------------------
HOMESRVS          Homemaker Services      15 Minute Unit            4         113         116          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         117         120          Numeric
--------------------------------------------------------------------------------------------------------------
                                                    Days            2         121         122          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         123         126          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         127         130          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         131         134          Numeric
--------------------------------------------------------------------------------------------------------------
PERS_I            Personal Emergency
                  Response System
                  Installation                       Job            2         135         136          Numeric
--------------------------------------------------------------------------------------------------------------
PERS_M            Personal Emergency
                  Response System -
                  Maintenance                        Day            2         137         138          Numeric
--------------------------------------------------------------------------------------------------------------
PEST_I            Pest Control -
                  Initial Visit                      Job            2         139         140          Numeric
--------------------------------------------------------------------------------------------------------------
                                                   Month            1         141         141          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         142         145          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         146         149          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         150         153          Numeric
--------------------------------------------------------------------------------------------------------------
                                                   Visit            2         154         155          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         156         159          Numeric
--------------------------------------------------------------------------------------------------------------
                                          15 Minute Unit            4         160         163          Numeric
--------------------------------------------------------------------------------------------------------------
                                                    Days            2         164         165          Numeric
--------------------------------------------------------------------------------------------------------------
                                                   Visit            4         166         169          Numeric
--------------------------------------------------------------------------------------------------------------
SPTH                                      15 Minute Unit            4         170         173          Numeric
--------------------------------------------------------------------------------------------------------------
TRANSPOR          Transportation
                  Services (not
                  included in Escort
                  or Adult Day
                  Health services)                 Trips            3         174         176          Numeric
--------------------------------------------------------------------------------------------------------------
OTH_UNIT          Other LTC Service
                  not listed (unit)           Unit/Visit            6         177         182          Numeric
--------------------------------------------------------------------------------------------------------------
                                                                   35         183         217             Text
--------------------------------------------------------------------------------------------------------------
                                             Amount Paid            6
--------------------------------------------------------------------------------------------------------------
                                                                   35
--------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                    EXHIBIT B

FILE 2: ACUTE CARE SERVICES

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
                                                   UNIT OF          FIELD     START    END     TEXT/NUMERIC
CODE        FIELD NAME     DESCRIPTION           MEASUREMENT       LENGTH      COL.    COL.
-------------------------------------------------------------------------------------------------------------
<S>                        <C>                      <C>                  <C>      <C>     <C>         <C>
            ACUTE          DESCRIPTION                  UNITS OF
            SERVICES                                SERVICE/COST
-------------------------------------------------------------------------------------------------------------
            SSN            Social Security
                           Number (left
                           justify)                    000000000          9         1       9         Numeric
-------------------------------------------------------------------------------------------------------------
            MEDICAID       Medicaid ID
                           Number                     0000000000         10        10      19         Numeric
-------------------------------------------------------------------------------------------------------------
            MONTH          Report  Month                  MMYYYY          6        20      25         Numeric
-------------------------------------------------------------------------------------------------------------
            CLINIC         Clinic Services                 Visit          2        26      27         Numeric
-------------------------------------------------------------------------------------------------------------
            CLINIC$$       Clinic Services                 Visit          2        28      29         Numeric
                           Costs
-------------------------------------------------------------------------------------------------------------
            DENTAL         Dental Services                 Visit          6        30      35         Numeric
-------------------------------------------------------------------------------------------------------------
            DENTAL$$       Dental Services
                           Costs                     Amount Paid          6        36      41         Numeric
-------------------------------------------------------------------------------------------------------------
            DIALYSIS       Dialysis Center                 Visit          2        42      43         Numeric
-------------------------------------------------------------------------------------------------------------
            DIALYS$$       Dialysis Center
                           Costs                     Amount Paid          6        44      49         Numeric
-------------------------------------------------------------------------------------------------------------
            ER             Emergency Room
                           Services                        Visit          2        50      51         Numeric
-------------------------------------------------------------------------------------------------------------
            ER_$$          Emergency Room
                           Services Costs            Amount Paid          6        52      57         Numeric
-------------------------------------------------------------------------------------------------------------
            FQHC           FQHC Services                   Visit          2        58      59         Numeric
-------------------------------------------------------------------------------------------------------------
            FQHC_$$        FQHC Services
                           Costs                     Amount Paid          6        60      65         Numeric
-------------------------------------------------------------------------------------------------------------
            HEAR           Hearing Services
                           Including
                           hearing aids              Amount Paid          6        66      71         Numeric
-------------------------------------------------------------------------------------------------------------
            INPTSVS        Inpatient
                           Hospital Services                 Day          3        72      74         Numeric
-------------------------------------------------------------------------------------------------------------
            INPTSVSS       Inpatient
                           Hospital
                           Services Costs            Amount Paid          6        75      80         Numeric
-------------------------------------------------------------------------------------------------------------
                                                     Amount Paid          6        81      86         Numeric
-------------------------------------------------------------------------------------------------------------
            ??SP           Nurse P?                        Visit          2        87      88         Numeric
-------------------------------------------------------------------------------------------------------------
            ??RNP_$$       Nurse P??                 Amount Paid          6        89      94         Numeric
-------------------------------------------------------------------------------------------------------------
            ?X_$$          Pharmaceuticals           Amount Paid          6        95     100         Numeric
-------------------------------------------------------------------------------------------------------------
            PA             Physical
                           Assistant                       Visit          2       101     102         Numeric
-------------------------------------------------------------------------------------------------------------
            PA_$$          Physical
                           Assistant Costs           Amount Paid          6       103     106         Numeric
-------------------------------------------------------------------------------------------------------------
            MD             Physician
                           Services                        Visit          2       109     110         Numeric
-------------------------------------------------------------------------------------------------------------
                           Physician
                           Services Costs            Amount Paid          6       111     116         Numeric
-------------------------------------------------------------------------------------------------------------
                                                       Encounter          3       117     119         Numeric
-------------------------------------------------------------------------------------------------------------
            OUTPT_$$                                 Amount Paid          6       120     125         Numeric
-------------------------------------------------------------------------------------------------------------
                                                           Visit          2       126     127         Numeric
-------------------------------------------------------------------------------------------------------------
            PODIAT$$                                 Amount Paid          6       128     133         Numeric
-------------------------------------------------------------------------------------------------------------
                           Rural Health
                           Services                        Visit          2       134     135         Numeric
-------------------------------------------------------------------------------------------------------------
                           Rural Health
                           Services Costs            Amount Paid          6       136     141         Numeric
-------------------------------------------------------------------------------------------------------------
            SNFREHAS       Skilled nursing
                           facility
                           services  -
                           rehabilitation **         Amount Paid          6       142     147         Numeric
-------------------------------------------------------------------------------------------------------------
            EYE_$$         Visual Services
                           including
                           eyeglasses                Amount Paid          6       148     153         Numeric
-------------------------------------------------------------------------------------------------------------
                           Other Acute
                           Service not
                           listed (unit)              Unit/Visit          6       154     159         Numeric
-------------------------------------------------------------------------------------------------------------
            DESCR 1        Description of
                           other Acute
                           service                                       35       160     194            Text
-------------------------------------------------------------------------------------------------------------
            OTH_$          Other Acute
                           Service not
                           listed (amount)           Amount Paid          6       195     200         Numeric
-------------------------------------------------------------------------------------------------------------
                           Description of
                           other Acute
                           service                                       35       201     235            Text
-------------------------------------------------------------------------------------------------------------
</TABLE>

**Medicare Crossovers

<PAGE>

                                    EXHIBIT C
                                  (Page 1 of 1)

                                   (Plan Name)
                              REPORT OF GRIEVANCES

                               (Reporting Quarter)

Were any new grievances filed during this reporting quarter? YES [ ]   NO [ ]

<TABLE>
<CAPTION>
 -------------------------------------------------------------------------------------------------------------------------------
  ENROLLEE'S    ENROLLEE'S  ENROLLEE'S   ENROLLEE'S  GRIEVANCE    GRIEVANCE   EXPEDITED    DISPOSITION   DISPOSITION   RESOLVED?
  LAST NAME     FIRST NAME   MEDICAID      SOCIAL      TYPE *       DATE       REQUEST?      TYPE **        DATE       (Y OR  N)
                               ID #      SECURITY #                           (Y OR N)
 -------------------------------------------------------------------------------------------------------------------------------
<S>             <C>         <C>          <C>         <C>          <C>         <C>          <C>           <C>           <C>

1
2
3
4
5
 -------------------------------------------------------------------------------------------------------------------------------
</TABLE>

 -----------------------------------------------------------------------
                          Grievance Type
 -----------------------------------------------------------------------
 1 = Quality of Care                  7 =  Enrollment/Disenrollment
 2 = Access to Care                   8 =  Termination of Contract
 3 = Not Medically Necessary          9 =  Unauthorized out of plan svcs
 4 = Excluded Benefit                 10 = Unauthorized in-plan svcs
 5 = Billing Dispute                  11 = Benefits available in plan
 6 = Contract Interpretation          12 = Other
 -----------------------------------------------------------------------

 -----------------------------------------------------------------------
                          Disposition Type
 -----------------------------------------------------------------------
 1 = Reassigned Case Manager          7 =  Disenrolled Self
 2 = Service Added to Plan of Care    8 =  Disenrolled by plan
 3 = Service Increased                9 =  In QA Review
 4 = Changed to Another Provider      10 = In Grievance Process
 5 = Reinstated in Plan               11 = Lost Contact with Enrollee
 6 = Billing Issue Resolved           12 = Other
 -----------------------------------------------------------------------

                                       10