<PAGE>   1
                                                                   Exhibit 10.17


                           EMPLOYMENT AGREEMENT dated as of November 1, 1998,
                           between ADVANCED HEALTH CORPORATION, a Delaware
                           corporation (the "Company"), and JEFFREY M. SAUERHOFF
                           (the "Employee").


         The Company desires to formalize the employment arrangements between
the Company and the Employee and to continue to employ the Employee as the
Senior Vice President, Finance of the Company and the Employee desires to accept
such continued employment by the Company, on the terms and subject to the
conditions hereinafter set forth.

         NOW, THEREFORE, in consideration of the mutual covenants and
obligations hereinafter set forth, the parties hereto hereby agree as follows:

         1. Employment. The Company hereby employs the Employee, and the
         Employee hereby accepts employment by the Company, upon the terms and
         subject to the conditions hereinafter set forth.

         2. Term. The employment of the Employee hereunder shall be for the
         four-year period commencing on the date hereof and ending on November
         1, 2002 (the "Base Term"). The Base Term shall automatically renew for
         consecutive one-year terms (each, a "Renewal Term" and together with
         the Base Term, collectively, the "Employment Period") unless either the
         Company or the Employee gives the other party hereto at least 90 days'
         prior written notice before the end of the Employment Period of such
         party's intent not to renew this Agreement.

         3. Duties. The Employee shall be employed as the Senior Vice President,
         Finance or in such other position as the Company and the Employee shall
         agree in writing. The Employee shall perform such duties and services
         as are appropriate and commensurate with the Employee's position with
         the Company and would otherwise be consistent in stature and prestige
         with the position of Senior Vice President, Finance of a corporation
         with similar operations as the Company, as the same may be assigned to
         him from time to time by the Board of Directors of the Company (the
         "Board").

         4.       Time to be Devoted to Employment; Place of Employment. (a)
                  Except for three weeks vacation per year (in addition to
                  public holidays), absences due to temporary illness, during
                  the Employment Period the Employee shall devote substantially
                  all of his business time, attention and energies to the
                  business and affairs of the Company.

                  (b) During the Employment Period, the Employee shall not be
                  engaged in any other business activity which conflicts with
                  the duties of the Employee hereunder, whether or not such
                  activity is pursued for gain, profit or other pecuniary
                  advantage.

         5.       Compensation; Reimbursement. (a) During the Employment Period,
                  the Company (or at the Company's option, any subsidiary or
                  affiliate thereof) shall pay to the Employee an annual salary
                  (the "Base Salary") of not less than $190,000, payable in such
                  installments as is the policy of the Company with respect to
                  its senior executive officers. Such Base Salary will be
                  reviewed at least annually and may be increased by the Board
                  (or, if such authority shall be delegated by the Board to the
                  Compensation Committee thereof, then by such Committee) in its
                  sole discretion.
<PAGE>   2
                  (b) From time to time the Employee may also receive cash
                  bonuses at the discretion of the Board or the Compensation
                  Committee.

                  (c) During the Employment Period and to the extent available
                  to employees of the Company, the Employee shall be entitled to
                  participate in all of the Company's benefit plans, pension and
                  retirement plans, life insurance, hospitalization and surgical
                  and major medical coverages, sick leave, vacation and holiday
                  policies, disability coverage and such other fringe benefits
                  enjoyed by other employees at substantially the same
                  employment level as the Employee.

                  (d) The Company shall reimburse the Employee, in accordance
                  with the practice from time to time for other employees of the
                  Company, for all reasonable and necessary traveling expenses,
                  disbursements and other reasonable and necessary incidental
                  expenses incurred by him for or on behalf of the Company in
                  the performance of his duties hereunder upon presentation by
                  the Employee to the Company of appropriate vouchers.

                  (e) The Employee shall maintain a suitable automobile for
                  business use. During the Employment Period, the Company shall
                  pay the Employee a $550 per month car allowance towards the
                  costs of leasing, using, insuring, repairing and maintaining
                  such automobile.

                  (f) Following the expiration or termination of this Agreement
                  for any reason, the Employee shall have the right to maintain
                  any (i) health and life insurance benefits provided by the
                  Company to the extent provided under applicable law and (ii)
                  any life insurance benefits provided by the Company so long as
                  the Employee makes the premium payments relating to such life
                  insurance.

         6.       Involuntary Termination. (a) If the Employee is incapacitated
                  or disabled by accident, sickness or other cause so as to
                  render him mentally or physically incapable of performing the
                  services required to be performed by him under this Agreement
                  for a period of 90 days or longer during any six-month period
                  (such condition being herein referred to as a "Disability"),
                  prior to the Employee resuming the performance of his duties
                  as contemplated herein, the Company may terminate the
                  employment of the Employee under this Agreement (an
                  "Involuntary Termination"). Until the Company or the Employee
                  shall have terminated the Employee's employment hereunder, the
                  Employee shall be entitled to receive his compensation and
                  other benefits as set forth in this Agreement notwithstanding
                  any such physical or mental disability.

                  (b) If the Employee dies during the Employment Period, his
                  employment hereunder shall be deemed to cease as of the date
                  of his death, and the termination of his employment occasioned
                  thereby shall be deemed an Involuntary Termination.

         7.       Termination for Cause. The Company may terminate the
                  Employee's employment hereunder for "Cause" (a "Termination
                  for Cause"). For purposes of this Agreement, "Cause" shall be
                  limited to:

                  (i)      the willful and continued failure by the Employee
                           substantially to perform the duties described in
                           Section 3 (other than any failure resulting 


                                       2
<PAGE>   3
                           from an illness or other similar incapacity or
                           disability), for 30 days after a written demand for
                           performance is delivered to the Employee on behalf of
                           the Board that specifically identifies the manner in
                           which it is alleged that the Employee has not
                           substantially performed his duties; or

                  (ii)     the conviction by the Employee of misappropriation of
                           funds, properties or assets of the Company, sexual
                           harassment, chronic alcoholism or drug addiction,
                           slander or libel concerning the Company or a material
                           tort relating to his office or employment with the
                           Company that has a material adverse effect on the
                           business, affairs, conditions (financial or
                           otherwise), operations, results of operations,
                           assets, properties or rights, liabilities or
                           obligations, customer or employee relationships or
                           prospects of the Company.

         8.       Termination Without Cause. The Company may terminate the
                  employment of the Employee hereunder at any time during the
                  Employment Period without "Cause" (a "Termination Without
                  Cause"). It is expressly acknowledged that if Employee shall
                  not report to the CEO of the Company, such change in reporting
                  structure shall constitute a Termination Without Cause. It is
                  expressly acknowledged that non-renewal of this Agreement as
                  contemplated by Section 2 shall not constitute a Termination
                  Without Cause. Further, if either (I) Employee's Base Salary
                  shall be reduced without Employee's consent, or (ii) Employee
                  shall be required to relocate outside the New York
                  metropolitan area, such action by Employer shall constitute a
                  Termination Without Cause.

         9.       Voluntary Termination. Any termination of the employment of
                  the Employee hereunder otherwise than as a result of an
                  Involuntary Termination, a Termination for Cause or a
                  Termination Without Cause shall be deemed to be a "Voluntary
                  Termination." A Voluntary Termination shall be deemed to be
                  effective immediately upon written notice of such termination
                  to the Company.

         10.      Change in Control. On a Change of Control, all options to
                  purchase common stock of the Company then held by the Employee
                  shall immediately vest and shall be exercisable for a period
                  of five years from the date of the Change in Control. For
                  purposes of this Agreement, a "Change in Control" of the
                  Company shall be deemed to have occurred if (a) there shall be
                  consummated (x) any consolidation or merger of the Company in
                  which the Company is not the continuing or surviving
                  corporation or pursuant to which shares of the common stock of
                  the Company (the "Common Stock") would be converted into cash,
                  securities or other property, other than a merger of the
                  Company in which the holders of the Common Stock immediately
                  prior to the merger have the same proportionate ownership of
                  common stock of the surviving corporation immediately after
                  the merger, or (y) any sale, lease, exchange or other transfer
                  (in one transaction or a series of related transactions) of
                  all, or substantially all, of the assets of the Company; or
                  (b) the stockholders of the Company approve any plan or
                  proposal for the liquidation or dissolution of the Company; or
                  (c) any person (as such term is used in Sections 13(d) and
                  14(d)(2) of the Securities Exchange Act of 1934, as amended
                  (the "Exchange Act")), shall become the beneficial owner
                  (within the meaning of Rule 13d-3 under the Exchange Act) of
                  30% or more of the Company's outstanding Common Stock; or (d)
                  during any period of two consecutive years, individuals who at
                  the beginning of such period constitute the entire Board shall
                  cease for any reason to constitute a majority thereof 


                                       3
<PAGE>   4
                  unless the election, or the nomination for election by the
                  Company's stockholders, of each new director was approved by a
                  vote of at least two-thirds of the directors then still in
                  office who were directors at the beginning of the period.

         11.      Effect of Termination of Employment. (a) Upon the termination
                  of the Employee's employment hereunder pursuant to a Voluntary
                  Termination or a Termination for Cause, neither the Employee
                  nor his beneficiary or estate shall have any further rights or
                  claims against the Company under this Agreement except to
                  receive:

                  (i)      any unpaid portion of the Base Salary provided for in
                           Section 5(a), computed on a pro rata basis to the
                           date of termination;

                  (ii)     cash compensation equal to the product of (A) the
                           number of days of accrued vacation, if any,
                           accumulated by the Employee to the effective date of
                           termination divided by the total number of work days
                           per annum for which the Employee receives a Base
                           Salary multiplied by (B) the Base Salary; and

                  (iii)    reimbursement for any expenses for which the Employee
                           shall not have theretofore been reimbursed as
                           provided in Section 5(d).

         In addition, current arrangements concerning indemnification, including
but not limited to payment of expenses of officers, directors, and employees in
connection with litigation involving the Company shall remain in full force and
effect following termination.

                  (b) Upon the termination of the Employee's employment
hereunder pursuant to an Involuntary Termination, neither the Employee nor his
beneficiary or estate shall have any further rights or claims against the
Company under this Agreement except the right (i) to receive a termination
payment equal to that provided for in Section 11(a) hereof, plus (ii) to receive
a cash severance payment in an aggregate amount equal to the cash compensation
received by the Employee during the 3-month period immediately prior to the
effective date of the Involuntary Termination, payable in equal monthly
installments, plus (iii) to be immediately vested in all stock options granted
to the Employee by the Company that would have vested during the three-month
period immediately following the effective date of the Involuntary Termination.
In addition, current arrangements concerning indemnification, including but not
limited to payment of expenses of officers, directors, and employees in
connection with litigation involving the Company shall remain in full force and
effect following termination.

(c) Upon the termination of the Employee's employment hereunder pursuant to a
Termination Without Cause, neither the Employee nor his beneficiary or estate
shall have any further rights or claims against the Company under this Agreement
except the right (i) to receive a termination payment equal to the amount
provided for in Section 11(a) hereof , (ii) to receive a cash severance payment
in an aggregate amount equal to the base salary and bonus received by the
Employee during the 12-month period immediately prior to the effective date of
the Termination Without Cause, plus car allowance, health insurance and life
insurance premium payments, professional licensing and membership fees and dues
for such one year period, payable in one lump sum within 10 days of such
termination if such termination occurs within six months of a Change in Control,
and otherwise in 12 equal monthly installments, (iii) reasonable cell phone and
pager use, and inclusion in the Company's 401(k) plan for the 12-month period
following such termination; plus (iv) all options to purchase common stock of
the Company, which shall include any parent or affiliated entity shall fully
vest and shall be exercisable for a period of five years following the date of
such Termination. In addition, current arrangements concerning


                                       4
<PAGE>   5
indemnification, including but not limited to payment of expenses of officers,
directors, and employees in connection with litigation involving the Company
shall remain in full force and effect following termination.


         12.      Non-Competition; Non-Disclosure of Information. (a) The
                  Employee shall not during the Employment Period, and for a
                  period of one year following the termination of the Employment
                  Period, (i) directly or indirectly engage in any Competitive
                  Business (as defined below), whether such engagement shall be
                  as an employee, employer, owner, consultant, partner or other
                  participant in any Competitive Business, (ii) assist others in
                  engaging in any Competitive Business in the manner described
                  in the foregoing clause (i), (iii) induce employees of the
                  Company to terminate their employment with the Company or
                  engage in any Competitive Business or (iv) induce customers or
                  vendors of the Company to alter or terminate their business
                  relationship with the Company; provided, however, that the
                  Employee may own directly or indirectly, solely as a passive
                  investment, securities of any Competitive Business traded on
                  any national securities exchange if the Employee is not a
                  controlling person of, nor a member of a group which controls
                  such person and does not, directly or indirectly, own 5% or
                  more of any class of securities of such person. As used
                  herein, the term "Competitive Business" shall mean any
                  business which, directly or indirectly, competes with the
                  Company or any of its subsidiaries in the business of
                  primarily providing physician practice management, physician
                  network management and/or clinical information technology to
                  or for physicians to the extent such businesses are conducted
                  by the Company and its subsidiaries at the time of any
                  termination of the Employment Period.

                  (b) The Employee understands that the foregoing restrictions
                  may limit his ability to earn a livelihood in a Competitive
                  Business, but he nevertheless believes that he has received
                  and will receive sufficient consideration and other benefits
                  in connection with his employment to clearly justify such
                  restrictions which, in any event, the Employee does not
                  believe would prevent him from earning a living. Nothing
                  herein contained shall prohibit the Employee from engaging in
                  a business that is not a Competitive Business.

                  (c)      The Employee agrees that he will not, at any time
                           during or after the Employment Period, disclose to
                           any person, firm, corporation or other entity, except
                           as required by law, any secret or confidential
                           information concerning the business, clients or
                           affairs of the Company or any subsidiary or affiliate
                           thereof for any reason or purpose whatsoever other
                           than in furtherance of the Employee's work for the
                           Company nor shall the Employee make use of any of
                           such secret or confidential information for his own
                           purpose or for the benefit of any person, firm,
                           corporation or other business entity except the
                           Company or any subsidiary or affiliate thereof.

         13.      Company Right to Inventions. The Employee shall promptly
                  disclose, grant and assign to the Company for its sole use and
                  benefit any and all inventions, improvements, technical
                  information, methods and suggestions (the "Inventions")
                  relating in any way to the business of providing physician
                  practice management, physician network management and/or
                  clinical information technology to or for physicians, which he
                  may develop or acquire during the period of the Employee's
                  employment with the Company prior to any termination of
                  employment (whether or not during usual working hours),
                  together with all patent applications, patents,


                                       5
<PAGE>   6
                  copyrights and reissues thereof that may at any time be
                  granted for or upon any such Inventions. In connection
                  therewith:

                  (a)      the Employee shall without charge, but at the expense
                           of the Company, promptly at all times hereafter
                           execute and deliver such applications, assignments,
                           descriptions and other instruments as may be
                           reasonably necessary or proper in the reasonable
                           opinion of the Company to vest title to any such
                           inventions, improvements, technical information,
                           methods, patent applications, patents, copyright
                           applications, copyrights or reissues of any thereof
                           in the Company and to enable it to obtain and
                           maintain the entire right and title thereto
                           throughout the world; and

                  (b)      the Employee shall render to the Company at its
                           expense (including a reasonable payment for the time
                           involved in case he is not then in its employ) all
                           such assistance as it may reasonably require in the
                           prosecution of applications for said patents,
                           copyrights or reissues thereof, in the prosecution or
                           defense or interferences which may be declared
                           involving any said applications, patents or
                           copyrights and in any litigation in which the Company
                           may be involved relating to any such patents,
                           copyrights, inventions, improvements, technical
                           information or methods.

         14.      Enforcement. It is the desire and intent of the parties hereto
                  that the provisions of this Agreement shall be enforced to the
                  fullest extent permissible under the laws and public policies
                  applied in each jurisdiction in which enforcement is sought.
                  Accordingly, if any particular provision of this Agreement
                  shall be adjudicated to be invalid or unenforceable, such
                  provision shall be deemed amended to delete therefrom the
                  portion thus adjudicated to be invalid or unenforceable, such
                  amendment to apply only with respect to the operation of such
                  provision in the particular jurisdiction in which such
                  adjudication is made; provided, however, that if any one or
                  more of the provisions contained in this Agreement shall be
                  adjudicated to be invalid or unenforceable because such
                  provision is held to be excessively broad as to duration,
                  geographical scope, activity or subject, such provision shall
                  be deemed amended by limiting and reducing it so as to be
                  valid and enforceable to the maximum extent compatible with
                  the applicable laws of such jurisdiction, such amendment to
                  apply only with respect to the operation of such provision in
                  the particular jurisdiction in which such adjudication is
                  made.

         15.      Remedies; Survival. (a) The Employee acknowledges and
                  understands that the provisions of this Agreement are of a
                  special and unique nature, the loss of which cannot be
                  accurately compensated for in damages by an action at law, and
                  that the breach of the provisions of this Agreement would
                  cause the Company irreparable harm. In the event of a breach
                  by the Employee of the provisions of Section 12 or 13 hereof,
                  the Company shall be entitled to an injunction restraining him
                  from such breach. Nothing herein contained shall be construed
                  as prohibiting the Company from pursuing any other remedies
                  available for any breach of this Agreement.

                  (b) Notwithstanding anything contained in this Agreement to
                  the contrary, the provisions of Sections 12, 13, 14 and this
                  Section 15 shall survive the expiration or other termination
                  of this Agreement until, by their terms, such provisions are
                  no longer operative.


                                       6
<PAGE>   7
                  (c)      It is understood and agreed that the provisions of
                           Sections 12 and 13 of this Agreement are separate and
                           distinct from any other agreement between the parties
                           hereto. Accordingly, in the event of a breach of such
                           provisions, the breaching party shall only be held
                           responsible for damages arising under such provisions
                           and not for any damages which may be claimed to arise
                           under or with respect to any other agreement that is
                           not separately breached.

         16.      Notices. Notices and other communications hereunder shall be
                  in writing and shall be delivered personally or sent by air
                  courier or first class certified or registered mail, return
                  receipt requested and postage prepaid, addressed as follows:

                               If to the Employee:
                               Jeffrey M. Sauerhoff
                               45 Longacre Drive
                               Huntington, NY  11743


                               If to the Company:
                               Advanced Health Corporation
                               555 White Plains Road, Second Floor
                               Tarrytown, New York 10591
                               Attention: Chairman and CEO

                  Or to such other address as the party to whom notice is to be
                  given may have furnished to the other party in writing in
                  accordance herewith. All notices and other communications
                  hereunder shall be deemed to have been given on the date of
                  delivery if personally delivered; on the business day after
                  the date when sent if sent by air courier; and on the third
                  business day after the date when sent if sent by mail, in each
                  case addressed to such party as provided in this Section 16.

         17.      Binding Agreement. This Agreement shall inure to the benefit
                  of and be enforceable by the Employee's personal or legal
                  representatives, executors, administrators, successors, heirs,
                  distributees and devisees. If the Employee should die while
                  any amount would still be payable to him hereunder if he had
                  continued to live, all such amounts, unless otherwise provided
                  herein, shall be paid in accordance with the terms of this
                  Agreement to the beneficiary designated by the Employee in
                  writing delivered to the Company, or if there be no such
                  designated beneficiary, to his estate.

         18.      Governing Law. This Agreement shall be governed by, and
                  construed and enforced in accordance with, the laws of the
                  State of New York applicable to contracts made and to be
                  performed wholly therein.

         19.      Waiver of Breach. The waiver by either party of a breach of
                  any provision of this Agreement by the other party must be in
                  writing and shall not operate or be construed as a waiver of
                  any subsequent breach by such other party.

         20.      Entire Agreement; Amendments; Execution. This Agreement
                  contains the entire agreement between the parties with respect
                  to the subject matter contained herein and supersedes all
                  prior agreements or understandings among the parties with
                  respect thereto. This Agreement may be amended only by an
                  agreement in writing signed by the parties hereto. This
                  Agreement may be executed in any number of counterparts, 


                                       7
<PAGE>   8
                  each of which shall be deemed an original document but all of
                  which shall constitute but one agreement.

         21.      Headings. The section headings contained in this Agreement are
                  for reference purposes only and shall not affect in any way
                  the meaning or interpretation of this Agreement.

         22.      Severability. Any provisions of this Agreement that is
                  prohibited or unenforceable in any jurisdiction shall, as to
                  such jurisdiction, be ineffective to the extent of such
                  prohibition or unenforceability without invalidating the
                  remaining provisions hereof, and any such prohibition or
                  unenforceability in any jurisdiction shall not invalidate or
                  render unenforceable such provision in any other jurisdiction.

         23.      Assignment. With respect to the Employee, this Agreement is
                  personal in its nature and the Employee shall not assign or
                  transfer this Agreement or any rights or obligations
                  hereunder. The Company may in its sole discretion assign or
                  otherwise transfer this Agreement and the provisions hereof
                  (including, without limitation, Sections 12, 13 and 14) shall
                  inure to the benefit of, and be binding upon, each successor
                  of the Company, whether by merger, consolidation, transfer of
                  all or substantially all assets, or otherwise.


         IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.

                           ADVANCED HEALTH CORPORATION



                                    --- /s/ Jonathan T. Edelson, MD ----
                                    Name:  Jonathan T. Edelson, MD
                                    Title:    Chairman and CEO


                                    ---/s/-- Jeffrey M. Sauerhoff---
                                    Jeffrey M. Sauerhoff


                                       8