<PAGE>
                                                                   EXHIBIT 10.22

                           SECOND AMENDED AND RESTATED

                         PACIFICARE HEALTH SYSTEMS, INC.

                    NON-QUALIFIED DEFERRED COMPENSATION PLAN

      WHEREAS, PacifiCare Health Systems, Inc., (the "Company") established a
non-qualified deferred compensation plan to provide supplemental retirement
income benefits for a select group of management and highly compensated
employees through deferrals of salary and bonuses, effective as of December 18,
1997;

      WHEREAS, it is believed that providing for deferral of compensation at the
election of each executive is in the best interests of the Company;

      WHEREAS, the Company believes that it is in its best interests to amend
and restate this plan;

      WHEREAS, it is the intent of the Company that this Amended and Restated
Plan supersede any other non-qualified deferred compensation plan, policy or
arrangement which the Company or any of its subsidiaries may have sponsored or
made available in the past; and

      WHEREAS, the Company intends that this plan shall be maintained as a "top
hat" plan described in Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA;

      NOW, THEREFORE, it is hereby declared as follows:

                                    ARTICLE I
                                   DEFINITIONS

      Whenever the following words and phrases are used in this Plan, they shall
have the meanings specified below.

Section 1.1 "Beneficiary" or "Beneficiaries" for purposes of this Plan shall
have the meaning set forth in Section 6.4.

Section 1.2 "Board of Directors" or "Board" means the Board of Directors of the
Company.

Section 1.3 "Bonus" means any management incentive plan bonus, long-term bonus,
sign-on bonus, retention bonus, sales commissions or any other bonuses
determined as eligible for the Plan by the Committee payable to a Participant in
addition to the


                                       1
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                                                                   EXHIBIT 10.22

Participant's Salary, other than moving expenses, prior to any reduction for
deferrals to a plan qualified under Section 125 or Section 401(k) of the Code.

Section 1.4 "Change of Control" shall have the meaning set forth in Section 6.3.

Section 1.5 "Common Stock" means the Company's Common Stock, par value $0.01 per
share.

Section 1.6 "Code" means the Internal Revenue Code of 1986, as amended from time
to time.

Section 1.7 "Committee" means the Committee appointed by the Compensation
Committee to administer the Plan in accordance with Article V.

Section 1.8 "Company" means PacifiCare Health Systems, Inc., a Delaware
corporation, or any successor corporation.

Section 1.9 "Compensation Committee" shall mean the Compensation Committee of
the Board of Directors of the Company.

Section 1.10 "Deferral Account" shall mean the amount of Salary and Bonus
deferred under Article III of this Plan, the Interest Rate or Rates credited to
such deferred amounts and the LTPIP Stock Accounts (as defined herein).

Section 1.11 "Disability." A Participant shall be deemed to be incapacitated or
disabled, if such Participant's incapacity or disability prevents a Participant
from fully performing his duties to an Employer for a period in excess of 90
days and, after such 90-day period, the Company and a physician, duly licensed
and qualified in the specialty of the Participant's incapacity or disability,
decide in their reasonable judgments, that such incapacity or disability will be
permanent or of such continued duration as to prevent a Participant from
resuming the rendition of services to the Employer for at least an additional
six-month period.

Section 1.12 "Distributable Amount" shall mean having the meaning set forth in
Section 3.8(a).

Section 1.13 "Eligible Employee" shall mean those Employees who satisfy any of
the requirements of Section 2.1.

Section 1.14 "Employee" shall mean any employee (as defined in accordance with
the Treasury Regulations and Revenue Rulings then applicable under Section 3401
(c) of the Code) of an Employer, whether such employee is so employed at the
time this Plan is adopted or becomes so employed subsequent to the adoption of
this Plan.


                                       2
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                                                                   EXHIBIT 10.22

Section 1.15 "Employer" means the Company (or any successor by merger,
consolidation or purchase of substantially all of the Company's assets) and any
and all Subsidiaries of the Company.

Section 1.16 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.

Section 1.17 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.

Section 1.18 "Fund" or "Funds" means one or more of the funds selected by the
Committee pursuant to Section 3.3(b).

Section 1.19 "Initial Election Period" for an Eligible Employee means the 30-day
period following the receipt by an Eligible Employee of enrollment material for
this Plan.

Section 1.20 "Interest Rate" shall mean, for each Fund, an amount equal to the
net gain or loss on the assets of such Fund during each month.

Section 1.21 "LTPIP Stock Account" shall have the meaning specified in Section
3.5.

Section 1.22 "Participant" means for purposes of this Plan, any Eligible
Employee who satisfies the requirements of Section 3.1.

Section 1.23 "Payment Eligibility Date" means the first day of the month
following the end of the calendar quarter in which a Participant terminates
employment for any reason with all Employers or dies.

Section 1.24 "Plan" means this Amended and Restated Non-Qualified Deferred
Compensation Plan of PacifiCare Health Systems, Inc., as it may be amended from
time to time.

Section 1.25 "Plan Year" means the 12 consecutive month period beginning on
January 1 and ending on December 31 of the same year.

Section 1.26 "Retirement" or "Retire" for purposes of this Plan means
termination of a Participant's employment from all Employers, which occurs after
the sum of the following two factors meet or exceed 55: (i) the Participant's
age and (ii) the Participant's number of years of service with all Employers.

Section 1.27 "Salary" shall mean the Participant's salary prior to any reduction
for deferrals to a plan qualified under Section 125 or Section 401 (k) of the
Code.

Section 1.28 "Social Security Wage Base" means contributions and benefits base
under Section 230 of the Social Security Act in effect for the Plan Year.


                                       3
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                                                                   EXHIBIT 10.22

Section 1.29 "Subsidiary" shall mean any corporation in an unbroken chain of
corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain then owns stock possessing 50 percent
or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.

                                   ARTICLE II
                                   ELIGIBILITY

Section 2.1 Eligibility.

      a. At the effective date of this Plan, an Employee of an Employer will be
eligible to defer payments of Salary and/or Bonus pursuant to the provisions of
this Plan if at the time when an election may be made: (i) he or she is
designated to be in an eligible position and has an annual base salary of least
$80,000; or (ii) he or she is an Employee scheduled to work at least 32 hours
per week designated by the Committee to be eligible to participate in this Plan
so long as such designation does not make this Plan not eligible for "top hat"
plan status. Notwithstanding any other provisions of this Plan, all Employees
who currently participate in this Plan shall continue to be eligible to
participate in this Plan in future Plan Years so long as the Employee remains
designated in an eligible position.

      b. A new Employee of an Employer will be eligible to defer payments of
Salary and/or Bonus pursuant to the provisions of this Plan if at the time when
an election may be made he or she meets the eligibility requirements in 2.1(a)
above.

      c. An Employee who satisfies the requirements of subsection (a) or (b)
shall be an "Eligible Employee."

                                   ARTICLE III
                            DEFERRAL OF COMPENSATION

Section 3.1 Participation.

      An Eligible Employee shall become a Participant in this Plan by electing
to defer a portion of his or her Salary and/or Bonus in accordance with Section
3.2.

Section 3.2 Elections to Defer Compensation.

      a. Initial Election Period. Subject to Article II and Section 3.1, each
Eligible Employee may elect to defer Salary and/or Bonus by filing with the
Committee, on a form provided by the Committee, an election that conforms to the
requirements of this Section 3.2, no later than the last day of his or her
Initial Election Period.


                                       4
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                                                                   EXHIBIT 10.22

      b. General Rule. The amount of compensation which an Eligible Employee may
elect to defer is as follows:

            (i) Any whole percentage of Salary up to and including 50 percent of
      Salary and/or

            (ii) Any whole percentage of Bonus up to 100 percent.

      c. Minimum Deferrals. For each Plan Year during which an Eligible Employee
is a Participant, the minimum amount that may be elected to be deferred under
Section 3.2(b) is $5,000. Such minimum may be satisfied by deferring Salary
and/or the Bonus payable for services rendered for such Plan Year (even though
it may not be paid until the next Plan Year); provided that if Salary is
deferred, the minimum Salary deferral is $5,000. Accordingly, if no Salary is
deferred for a Plan Year and the total amount of the Bonus elected to be
deferred with respect to that Plan Year is in fact less than $5,000, then no
portion of the Bonus shall be deferred.

      d. Effect of Initial Election. For Participants who are Employees of an
Employer on the effective date of this Plan, an election to defer Salary and/or
Bonus during the Initial Election Period shall be effective with respect to
Salary and/or Bonus earned during the first pay period beginning after the end
of the Initial Election Period. For Participants who become Employees of an
Employer subsequent to the effective date of this Plan, an election to defer
Salary and/or Bonus during the Initial Election Period shall be effective with
respect to Salary and/or Bonus earned as soon as administratively possible.

      e. Duration of Deferral Election. Any Salary and/or Bonus deferral
election made under subsection (a) or subsection (f) of this Section 3.2 shall
be irrevocable and shall apply to the Salary payable during subsequent Plan
Years and/or Bonus payable with respect to services performed during subsequent
Plan Years until a Participant makes a new election; provided, however, that an
election may not be changed for the first Plan Year after an election is made or
for any Plan Year once the Plan Year has begun. An Eligible Employee may make
changes to his or her election, subject to the limitations set forth in this
Section 3.2, to change the deferral under a previous election by filing with the
Committee on forms provided by the Committee, a new election to defer a
percentage of his or her Salary and/or Bonus on or before the December 15
preceding the Plan Year for which the new election is to apply. Notwithstanding
the foregoing, the Committee may, in its absolute discretion, permit an Eligible
Employee to file an election to defer on or after December 15, if, in its
judgment, his or her failure to do so prior to said date was due to reasonable
cause, but in no event may such election be filed after December 31. All
elections, once made, are irrevocable.

      f. Elections other than Elections during the Initial Election Period.
Subject to the minimum deferral requirement of subsection (c) above, any
Eligible Employee who fails to elect to defer Salary and/or Bonus during his or
her Initial Election Period

                                       5
<PAGE>
                                                                   EXHIBIT 10.22

may subsequently become a Participant, and any Eligible Employee who has
terminated a prior Salary deferral election may elect to again defer Salary and
/or Bonus, by filing an election, on a form provided by the Committee, to defer
Salary and/or Bonus as described in this Section 3.2. An election to defer
Salary and/or Bonus must be filed on or before each December 15 and will be
effective for Salary paid after the following January 1 and the Bonus payable
with respect to services performed in the Plan Year beginning on the following
January 1.

      g. Reduction of Salary and/or Bonus. Upon an election to defer Salary
and/or Bonus, each Participant's Salary or Bonus will be reduced by the amount
elected to be deferred. If necessary, Bonus deferrals may be reduced in order to
cover any taxes that are required to be paid at the time of deferral.

Section 3.3 Investment Elections.

      a. At the time of making the deferral elections described in Section 3.2,
the Participant shall designate, on a form provided by the Committee, the types
of funds the Participant's Deferral Account will be deemed to be invested in for
purposes of determining the amount of Interest Rate or Rates to be credited to
his or her Account. Examples of the types of funds that may be available for
investment are: (i) Money Market Fund; (ii) Common Stock Fund; (iii)
International Equity Fund; (iv) Balanced Fund; (v) Growth Fund; (vi) Aggressive
Growth Fund; (vii) Bond Fund; and (viii) Global Equity Fund.

      In making the designation pursuant to this Section 3.3, the Participant
may specify that all or any whole percentage of his Deferral Account be deemed
to be invested in one or more funds. Weekly, a Participant may change the
designation made under this Section 3.3 with respect to amounts contained in his
or her Deferral Accounts or amounts to be credited to his or her Deferral
Accounts by current or future deferrals by filing an election, on a form
provided by the Committee, submitted no later than 12:00 a.m. Pacific Time
Wednesday of each week. If a Participant fails to elect a type of fund under
this Section 3.3, he or she shall be deemed to have elected a fund similar to a
Money Market Fund.

      b. Although the Participant may designate the type of funds in subsection
(a) above, the Committee shall select from time to time, in its sole discretion,
a commercially available fund similar to the types described in subsection (a)
above to be the Funds. The Interest Rate of such commercially available fund or
contract shall be used to determine the amount of earnings or losses to be
credited to Participants' Deferral Accounts under Section 3.4.


                                       6
<PAGE>
                                                                   EXHIBIT 10.22

Section 3.4 Deferral Account.

      The Committee shall establish and maintain a Deferral Account for each
Participant under the Plan. Each Participant's Deferral Account shall be further
divided into separate subaccounts ("fund subaccounts"), each of which
corresponds to a fund elected by the Participant pursuant to Section 3.3(a). A
Participant's Deferral Account shall be credited as follows:

      a. Within 10 business days of each regular Company payday, the Committee
shall credit the fund subaccounts of the Participant's Deferral Account with an
amount equal to Salary deferred by the Participant during each pay period in
accordance with the Participant's election under Section 3.3(a); that is, the
portion of the Participant's deferred Salary that the Participant has elected to
be deemed to be invested in a certain type of fund shall be credited to the fund
subaccount corresponding to that fund.

      b. Within 10 business days of the Bonus or partial Bonus payment, the
Committee shall credit the fund subaccounts of the Participant's Deferral
Account with an amount equal to the portion of the Bonus deferred by the
Participant's election under Section 3.3(a); that is, the portion of the
Participant's deferred Bonus that the Participant has elected to be deemed to be
invested in a particular type of fund shall be credited to the fund subaccount
corresponding to that fund.

      c. As of the last day of each month, each fund subaccount of a
Participant's Deferral Account shall be credited with earnings or losses in an
amount equal to that determined by multiplying the balance credited to such fund
subaccount as of the last day of the preceding month by the Interest Rate for
the corresponding Fund selected by the Committee pursuant to Section 3.2(b) with
the assumption that all dividends or interest is reinvested at the fair market
value of the Fund at the end of the day in which it would be paid.

      d. All amounts in a Participant's Deferral Account shall be 100 percent
vested at all times.

Section 3.5 Deferred LTPIP Stock Accounts.

      The Long-Term Performance Incentive Plan ("LTPIP") Stock Account (the
"LTPIP Stock Account") shall continue to be maintained by the Plan for
Participants who participated in the LTPIP and deferred all or any portion of
their LTPIP Bonus. The LTPIP Stock Account was credited with stock units (the
"LTPIP Stock Units") equal to the number of shares of Common Stock into which
the amount deferred was converted based on the closing price of the Common Stock
at the time the LTPIP Bonus was deferred. The LTPIP Stock Units shall continue
to be credited to a bookkeeping account, established for this purpose in the
Participant's name. The number of LTPIP Stock Units shall remain constant over
the deferral period except as adjusted pursuant to Section 3.7.


                                       7
<PAGE>
                                                                   EXHIBIT 10.22

The number of shares of Common Stock to be distributed shall equal the number of
LTPIP Stock Units credited to the LTPIP Stock Account at the time the LTPIP
Bonus was originally awarded.

Section 3.6 Rollovers.

      a. Participant's account balances transferred to this Plan from the FHP
International Corporation Deferred Compensation Plan, as amended, shall be
governed by the terms and conditions of this Plan and shall be referred to as
the "FHP Rollover Amount" and were credited to such Participant's Deferral
Account as of December 31, 1997.

      b. Participant's account balances transferred to this Plan from any prior
deferred compensation maintained by the Company shall be governed by the terms
and conditions of this Plan, shall be referred to as the "Existing PHS Rollover
Amount" and were credited to such Participant's Deferral Account as of December
31, 1997.

Section 3.7 Change In Company Shares.

      If the outstanding shares of Common Stock are hereafter changed into or
exchanged for a different number or kind of shares or other securities of the
Company, or of another company, by reason of reorganization, merger,
consolidation, recapitalization, reclassification, stock split, stock dividend
or combination of shares, or if the Company distributes a cash or non-cash
dividend to holders of Common Stock or engages in another similar transaction,
the Committee shall make an appropriate and equitable adjustment in the number
and kind of units credited to the LTPIP Stock Account. Any such adjustment made
by the Committee shall be final and binding upon a Participant, the Company and
all other interested persons.

Section 3.8 Distribution of Deferred Compensation.

      (a) In the case of a Participant who terminates employment with all
Employers on or after Retirement or who terminates as a result of a Disability,
the aggregate amount credited to the Deferral Account (the "Distributable
Amount") shall be paid to the Participant (and after his death to his or her
Beneficiary) in the form of substantially equal annual installments over 10
years beginning as soon as administratively possible after a Participant's
Payment Eligibility Date. Notwithstanding the foregoing, a Participant described
in the preceding sentence may elect one of the following optional forms of
distribution provided that his or her election is filed with the Committee at
least one year prior to his or her termination of employment with all Employers:

            (i) a single lump sum cash payment payable as soon as
      administratively possible after Participant's Payment Eligibility Date;

                                       8
<PAGE>
                                                                   EXHIBIT 10.22

            (ii) substantially equal annual installments over five years
      beginning as soon as administratively possible after Participant's Payment
      Eligibility Date; or

            (iii) substantially equal annual installments over fifteen years
      beginning as soon as administratively possible after Participant's Payment
      Eligibility Date.

      Any such election filed less than one year prior to termination of
employment shall not become effective. If a Participant is receiving salary
continuation/severance payments, and continues to participate in the Plan,
termination of employment shall be defined as the date in which salary
continuation/severance ceases for purposes of the form of distribution election
filing.

      Notwithstanding this subsection, if the Distributable Amount is $50,000 or
less, the Distributable Amount shall automatically be distributed in the form of
a single lump sum cash payment as soon as administratively possible after
Participant's Payment Eligibility Date. The Participant's Deferral Accounts
shall continue to be credited monthly with Interest Rate or Rates pursuant to
Section 3.4 of this Plan until all amounts credited to his or her Deferral
Accounts under this Plan have been distributed. For all purposes under this
Plan, a Participant shall not be considered terminated from employment with all
Employers if the Participant remains employed by an entity that is an Employer.
However, if the Employee is employed by an Employer and such Employer ceases to
be an Employer as a result of a sale or other corporate reorganization, such
sale or other corporate reorganization shall be treated as termination of
employment with all Employers unless immediately following such event and
without any break in employment the Participant remains employed by an Employer
or the former Employer assumes liability for the benefit of the Participant.

      (b) In the case of a Participant who terminates employment with all
Employers prior to Retirement or for reasons other than a Disability, the
Distributable Amount shall be paid to the Participant (and after his death to
his or her Beneficiary) in the form of a single lump sum cash payment as soon as
administratively possible after Participant's Payment Eligibility Date.
Notwithstanding the foregoing, a Participant described in the preceding sentence
may elect one of the following optional forms of distribution provided that his
or her election is filed with the Committee at least one year prior to his or
her termination of employment with all Employers:

            (i) substantially equal annual installments over three years
      beginning as soon as administratively possible after Participant's Payment
      Eligibility Date; or

            (ii) substantially equal annual installments over five years
      beginning as soon as administratively possible after Participant's Payment
      Eligibility Date.

      Any such election filed less than one year prior to termination of
employment shall not become effective.


                                       9
<PAGE>
                                                                   EXHIBIT 10.22

      (c) Individuals who are receiving salary continuation/severance payments
shall continue to be eligible to participate in this Plan. If such Participant
receives salary continuation/severance, and continues to participate in the
Plan, then the Distributable Amount shall be paid to such Participant in
accordance with his or her elections for distribution upon termination of salary
continuation/severance; provided, however, if such Participant can be deemed to
be Retired as of the salary continuation/severance end date, and continues to
participate in the Plan, then the Distributable Amount shall be paid to such
Participant in accordance with his or her election for distribution for
retirement upon termination of salary continuation/severance. Eligibility for
retirement distribution will be calculated using the (i) the Participant's age
at the end of the salary continuation/severance period and (ii) the
Participant's number of years of service with all Employers at the beginning of
the salary continuation/severance period.

      (d) In the case of a Participant who dies while employed by an Employer,
the Participant's Beneficiary will be paid his or her Distributable Amount in a
single lump sum cash payment. If a Participant dies after terminating employment
with all Employers and while receiving installment payments of his or her
Distributable Amount, the remaining portion of the Participant's Distributable
Amount will be paid in a single lump sum payment to the Participant's
Beneficiary.

      (e) A Participant who has not terminated employment with all Employers may
change his or her form of payment applicable to the portion of the Deferral
Account balance attributable to one or more Plan Years to one of the payment
forms permitted by the Plan at least one year prior to his or her termination of
employment with all Employers and, in the case of scheduled early distributions
elected pursuant to Section 3.10, may defer the Scheduled Payment Dates in
accordance with Section 3.10. Any such election to change form of payment less
than one year prior to termination of employment shall not become effective. The
Participant's payment election with respect to a given Plan Year may not be
changed after payment of that portion of the Deferral Account balance has been
made or has begun.

      (f) In the case of a Participant who becomes a Participant in this Plan as
a result of a FHP Rollover and who is receiving salary continuation, the
Distributable Amount of such Participant upon termination of salary continuation
shall be paid to such Participant in the form of a single lump sum cash payment;
provided, however, if such Participant can be deemed to be Retired, then the
Distributable Amount shall be paid to such Participant in accordance with his or
her elections to defer.

Section 3.9 Unscheduled Early Distributions.

      A Participant shall be permitted to elect to withdraw amounts from his or
her Deferral Accounts prior to termination of employment with all Employers
("Early Distributions"), subject to the following restrictions:


                                       10
<PAGE>
                                                                   EXHIBIT 10.22

      a. The election to take an Early Distribution shall be made by filing a
form provided by and filed with the Committee prior to the end of any calendar
month.

      b. The amount of the Early Distribution shall in all cases equal 90
percent of the Distributable Amount as of the end of the calendar month in which
the distribution is to be made.

      c. The amount described in subsection 3.9(b) above shall be paid in a
single lump sum cash payment as soon as practicable after the end of the
calendar month in which the Early Distribution election is made.

      d. If a Participant receives an Early Distribution pursuant to this
Section 3.9, 10 percent of the Distributable Amount shall be permanently
forfeited and the Company shall have no obligation to the Participant or any
Beneficiary with respect to such forfeited amount.

      e. If a Participant receives an Early Distribution, the Participant will
be ineligible to participate in this Plan for the balance of the Plan Year and
for the following Plan Year.

Section 3.10 Scheduled Early Distributions.

      Participants may elect to have their Salary and/or Bonus deferred during a
given Plan Year and any earnings credited to the deferred be paid on a future
date while still employed, provided the payment date (the "Scheduled Payment
Date") is at least two years from the last day of such Plan Year. This election
shall apply to the Salary and/or Bonus deferred for the Plan Year specified by
the Participant on his or her payment election and the Interest Rate or Rates
credited thereto until the Scheduled Payment Date. A Participant may elect a
different Payment Date for Salary and/or Bonus deferred for each Plan Year. In
addition, Scheduled Payment Dates elected pursuant to this Section 3.10 may be
deferred by at least one year, by filing with the Committee written notice at
least one year prior to the Scheduled Payment Date. A Participant may elect to
defer a Scheduled Payment Date selected by this Section 3.10 once every two
years. A distribution pursuant to this Section 3.10 of less than the
Participant's entire interest in the Deferral Account shall be made pro rata
from his or her investment fund subaccounts according to the balances in such
subaccounts. All early distributions pursuant to this Section 3.10 shall be made
in a single lump sum cash payment. Notwithstanding the foregoing, if a
Participant terminates employment with all Employers for any reason prior to the
date on which a payment is scheduled to be made pursuant to this Section 3.10,
the Participant's entire Deferral Account balance will be paid pursuant to the
provisions of Section 3.8.


                                       11
<PAGE>
                                                                   EXHIBIT 10.22

Section 3.11 Financial Hardship Withdrawals.

      The Committee may, pursuant to rules adopted by it and applied in a
uniform manner, accelerate the date of distribution of all or any portion of a
Participant's Deferral Account balance, including amounts in the LTPIP Stock
Account, because of a financial hardship. A financial hardship means an
unforeseeable, severe financial emergency resulting from (a), a sudden and
unexpected illness or accident of the Participant or his or her dependent (as
defined in Section 152(a) of the Code); (b) loss of the Participant's property
due to casualty; or (c) other similar extraordinary and unforeseeable
circumstances arising out of an event beyond the control of the Participant,
which may not be relieved through other available resources of the Participant,
as determined by the Committee in accordance with uniform rules adopted by it.
Distribution pursuant to this Section 3.11 of less than the Participant's entire
interest in the Plan shall be made pro rata from his or her investment fund
subaccounts according to the balances in such subaccounts. Subject to the
foregoing, payment of any amount with respect to which a Participant has filed a
request under this Section 3.11 shall be made in a single lump sum cash payment
as soon as practicable after approval of such request by the Committee and shall
be limited to the amount necessary to satisfy the financial hardship.
Distributions made pursuant to this Section 3.11 shall be without penalty.

Section 3.12 Inability to Locate Participant.

      In the event that the Committee is unable to locate a Participant or
Beneficiary within two years following the Participant's Payment Eligibility
Date, the amount allocated to the Participant's Deferral Account shall be
forfeited. If, after such forfeiture, the Participant or Beneficiary later
claims such benefit, such benefit shall be reinstated without interest or
earnings.

Section 3.13 Distributions Upon A Change of Control.

      a. If a Change of Control occurs, the Distributable Amount of each
Participant will be paid by the Trustee of the Trust (as defined herein) to the
Participant (or Beneficiary) in accordance with such Participants' deferral
election.

      b. Following a Change in Control, no changes in the Plan, or in any
documents evidencing an election to defer compensation, and no adjustments,
determinations or other exercises of discretion by the Compensation Committee,
the Committee or the Company's board of directors that were made subsequent to
the Change in Control and that would have the effect of diminishing a
Participant's rights or payments under this Plan or this Section 3.13, or of
causing a Participant to recognize income (for federal income tax purposes) with
respect to a Participant's Deferral Account prior to the actual distribution to
a Participant of such Deferral Account, shall be effective.


                                       12
<PAGE>
                                                                   EXHIBIT 10.22

                                   ARTICLE IV
                                      TRUST

Section 4.1 Trust.

      a. The Company shall cause the payment of benefits under this Plan to be
made in whole or in part by the Trustee of the PacifiCare Health Systems, Inc.
Rabbi Trust (the "Trust") in accordance with the provisions of this Section 4.1.
As soon as administratively possible after Participant's deferral is made (but
no later than the tax return due date of the Company for such year), the
Employers shall contribute to the Trust for each Participant an amount equal to
the amount deferred by the Participant for the Plan Year. Notwithstanding
anything contained herein, contributions to the Trust by each Employer may be
made throughout the Plan Year.

      b. The Committee shall direct the Trustee to pay the Participant or his or
her Beneficiary at the time and in the amount described in the Article III. In
the event the amounts held under the Trust are not sufficient to provide the
full amount (excluding amounts described in Section 3.8(c)) payable to the
Participant, the Employers shall pay for the remainder of such amount at the
times set forth in Section 3.8, (excluding amounts described in Section 3.8(c)).

                                    ARTICLE V
                                 ADMINISTRATION

Section 5.1 Committee.

      A number of individuals shall be appointed by, and serve at the pleasure
of, the Compensation Committee as a committee to administer this Plan (the
"Committee"). The number of members comprising the Committee shall be determined
by the Compensation Committee, which may from time to time vary the number of
members. A member of the Committee may resign by delivering a written notice of
resignation to the Compensation Committee. The Compensation Committee may remove
any member by delivering a certified copy of its resolution of removal to such
member. Vacancies in the membership of the Committee shall be filled promptly by
the Compensation Committee.

Section 5.2 Committee Action.

      The Committee shall act at meetings by affirmative vote of a majority of
the members of the Committee. Any action permitted to be taken at a meeting may
be taken without a meeting if, prior to such action, a written consent to the
action is signed by all members of the Committee and such written consent is
filed with the minutes of the proceedings of the Committee. A member of the
Committee shall not vote or act upon any matter, which relates solely to himself
or herself as a Participant. The Chairman or


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                                                                   EXHIBIT 10.22

any other member or members of the Committee designated by the Chairman may
execute any certificate or other written direction on behalf of the Committee.

Section 5.3 Powers and Duties of the Committee.

      a. The Committee, on behalf of the Participants and their Beneficiaries,
shall enforce the Plan in accordance with its terms, shall be the "Plan
Administrator" charged with the general administration of the Plan, and shall
have all discretionary authority and powers necessary to accomplish its
purposes, including, but not by way of limitation, the following:

            i. To select the funds or contracts to be the Funds in accordance
      with Section 3.3(b);

           ii. To construe and interpret the terms and provisions of this Plan;

           iii. To compute and certify to the amount and kind of benefits
     payable to Participants and their Beneficiaries;

           iv. To maintain all records that may be necessary for the
     administration of the Plan;

           v. To provide for the disclosure of all information and the filing or
     provision of all reports and statements to Participants, Beneficiaries or
     governmental agencies as shall be required by law;

           vi. To make and publish such rules for the regulation of this Plan
     and procedures for the administration of this Plan as are not inconsistent
     with, the terms hereof;

           vii. To appoint a plan administrator or any other agent, and to
     delegate to them such powers and duties in connection with the
     administration of this Plan as the Committee may from time to time
     prescribe; and

           viii. To take all actions set forth in the Trust agreement, including
     determining whether to hold or discontinue the policies.

Section 5.4 Construction and Interpretation.

      The Committee shall have full discretion to construe and interpret the
terms and provisions of this Plan, which interpretation or construction shall be
final and binding on all parties, including but not limited to the Company and
any Participant or Beneficiary. The Committee shall administer such terms and
provisions in a uniform and nondiscriminatory manner and in full accordance with
any and all laws applicable to the Plan.


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                                                                   EXHIBIT 10.22

Section 5.5 Information.

      To enable the Committee to perform its functions, the Employers shall
supply full and timely information to the Committee on all matters relating to
the compensation of all Participants, their death or other cause of termination,
and such other pertinent facts as the Committee may require.

Section 5.6 Compensation, Expenses and Indemnity.

      a. The members of the Committee shall serve without compensation for their
services hereunder.

      b. The Committee is authorized at the expense of the Company to employ
such legal counsel, as it may deem advisable to assist in the performance of its
duties hereunder. Expenses and fees in connection with the administration of the
Plan shall be paid by the Company.

      c. To the extent permitted by applicable state law, the Company shall
indemnify and hold harmless the Committee and each member thereof, the Board of
Directors, the Compensation Committee and any delegate of the Committee who is
an employee of the Company against any and all expenses, liabilities and claims,
including legal fees to defend against such liabilities and claims arising out
of their discharge in good faith of responsibilities under or incident to this
Plan, other than expenses and liabilities arising out of bad faith willful
misconduct. This indemnity shall not preclude such further indemnities as may be
available under insurance purchased by the Company or provided by the Company
under any bylaw, agreement or otherwise, as such indemnities are permitted under
state law.

Section 5.7 Quarterly Statements.

      Under procedures established by the Committee, a Participant shall receive
a statement with respect to such Participant's Deferral Accounts on a quarterly
basis as of each March 31, June 30, September 30 and December 31.

Section 5.8 Suspension of Deferrals.

      a. At the request of a Participant, the Committee may at its sole
discretion, pursuant to rules adopted by it and applied in a uniform manner,
suspend an election to defer Salary made pursuant to Article III during the Plan
Year for which the election to defer was made because of circumstances arising
out of an event beyond the control of the Participant, as determined by the
Committee in accordance with uniform rules adopted by it. Requests to suspend
Bonus deferrals must be made prior to October 1 of a succeeding plan year to be
considered by the Committee for suspension. If the Committee permits the
suspension of an election to defer, a Participant will be ineligible


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                                                                   EXHIBIT 10.22

      to participate in this Plan for the balance of the Plan Year and for the
following Plan Year.

      b. In the event a Participant requests to suspend participation during his
or her salary continuation/severance period and his or her request is approved
by the Committee, this event will trigger termination and distribution will be
made subject to the following restrictions:

            (i) The election to cease participation during salary
      continuation/severance shall be made by filing a form provided by and
      filed with the Committee;

            (ii) Distribution of the Distributable Amount shall be paid as soon
      as administratively possible after the end of the calendar month of the
      Committee approval; and

            (iii) The Distributable Amount shall be paid as elected under the
      Participant's retirement or termination election provided his or her
      election is filed with the Committee at least one year prior to his or her
      termination of employment with all Employers

            (iv) If a Participant receives Distribution under the above
      provisions, the Participant will be ineligible to particpate in this Plan
      for the balance of the salary continuation/severance period.

Section 5.9 Claim Procedures.

      a. Claim. A person who believes that he or she is being denied a benefit
to which he or she is entitled under this Plan (hereinafter referred to as
"Claimant") may file a written request for such benefit with the Plan
Administrator, setting forth his or her claim.

      b. Claim Decision. Upon receipt of a claim, the Plan Administrator shall
advise the Claimant that a reply will be forthcoming within 90 days and shall,
in fact, deliver such reply within such period. The Plan Administrator may,
however, extend the reply period for an additional 90 days for special
circumstances.

      If the claim is denied in whole or in part, the Plan Administrator shall
inform the Claimant in writing, using language calculated to be understood by
the Claimant, setting forth: (A) the specified reason or reasons for such
denial; (B) the specific reference to pertinent provisions of this Plan on which
such denial is based; (C) a description of any additional material or
information necessary for the Claimant to perfect his or her claim and an
explanation why such material or such information is necessary; (D) appropriate
information as to the steps to be taken if the Claimant wishes to submit the
claim for review; and (E) the time limits for requesting a review under
subsection 5.9(c).


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                                                                   EXHIBIT 10.22

      c. Request for Review. Within 60 days after the receipt by the Claimant of
the written opinion described above, the Claimant may request in writing that
the Committee review the determination of the Plan Administrator. The Claimant
or his or her duly authorized representative may, but need not, review the
pertinent documents and submit issues and comments in writing for consideration
by the Committee. If the Claimant does not request a review within such 60 day
period, he or she shall be barred and estopped from challenging the Plan
Administrator's determination.

      d. Review of Decision. Within 60 days after the Committee's receipt of a
request for review, after considering all materials presented by the Claimant,
the Committee will inform the Participant in writing, in a manner calculated to
be understood by the Claimant, of its decision setting forth the specific
reasons for the decision and containing specific references to the pertinent
provisions of this Plan on which the decision is based. If special circumstances
require that the 60 day time period be extended, the Committee will so notify
the Claimant and will render the decision as soon as possible, but no later than
120 days after receipt of the request for review.

                                   ARTICLE VI
                                  MISCELLANEOUS

Section 6.1 Unsecured General Creditor.

      Participants and their Beneficiaries, heirs, successors, and assigns shall
have no legal or equitable rights, claims, or interest in any specific property
or assets of any Employer. Any and all of the assets of each Employer shall be,
and remain, the general unpledged, unrestricted assets of such Employer. Each
Employer's obligation under this Plan shall be merely that of an unsecured
promise to pay money in the future, and the rights of the Participants and
Beneficiaries shall be no greater than those of unsecured general creditors. It
is the intention of the Company that this Plan (and the Trust described in
Article IV) be unfunded for purposes of the Code and for purposes of Title I of
ERISA.

Section 6.2 Restriction Against Assignment.

      The Employers shall pay all amounts payable hereunder only to the person
or persons designated by the Plan and not to any other person or corporation. No
part of a Participant's Deferral Account shall be liable for the debts,
contracts, or engagements of any Participant, his or her Beneficiary, or
successors in interest, nor shall a Participant's Deferral Account be subject to
execution by levy, attachment, or garnishment or by any other legal or equitable
proceeding, nor shall any such person have any right to alienate, anticipate,
sell, transfer, commute, pledge, encumber, or assign any benefits or payments
hereunder in any manner whatsoever. If any Participant, Beneficiary or successor
in interest is adjudicated bankrupt or purports to anticipate, alienate, sell,
transfer, commute, assign, pledge, encumber or charge any distribution or
payment from the Plan, voluntarily or involuntarily, the Committee, in its
discretion, may cancel such distribution


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                                                                   EXHIBIT 10.22

or payment (or any part thereof) to or for the benefit of such Participant,
Beneficiary or successor in interest in such manner as the Committee shall
direct.

Section 6.3 Change of Control.

      For purposes of this Plan, "Change of Control" means the occurrence of any
of the following: (i) a business combination effectuated through the merger or
consolidation of the Company with or into another entity where the Company is
not the Surviving Organization; (ii) any business combination effectuated
through the merger or consolidation of the Company with or into another entity
where the Company is the Surviving Organization and such business combination
occurred with an entity whose market capitalization prior to the transaction was
greater than 50 percent of the Company's market capitalization prior to the
transaction; (iii) the sale in a transaction or series of transactions of all or
substantially all of the Company's assets; (iv) any "person" or "group" (within
the meaning of Sections 13(d) and 14(d) of the Exchange Act) other than
UniHealth, a California non-profit public benefit corporation; (v) a dissolution
or liquidation of the Company; or (vi) the Company ceases to be subject to the
reporting requirements of the Exchange Act as a result of a "going private
transaction" (within the meaning of the Exchange Act). For purposes hereof,
"Surviving Organization" shall mean any entity where the majority of the members
of such entity's board of directors are persons who were members of the
Company's board of directors prior to the merger, consolidation or other
business combination and the senior management of the surviving entity includes
all of the individuals who were the Company's executive management (the
Company's chief executive officer and those individuals who report directly to
the Company's chief executive officer) prior to the merger, consolidation or
other business combination and such individuals are in at least comparable
positions with such entity. The Committee may make such determinations and
interpretations and adopt such rules and conditions as it, in its absolute
discretion, deems appropriate in connection with a Change in Control. All such
determinations and interpretations by the Committee shall be conclusive.

Section 6.4 Beneficiary.

      For purposes of the this Plan, "Beneficiary" or "Beneficiaries" mean the
person or persons, including a trustee, personal representative or other
fiduciary, last designated in writing by a Participant in accordance with
procedures established by the Committee to receive the benefits specified
hereunder in the event of the Participant's death. No beneficiary designation
shall become effective until it is filed with the Committee. If there is no such
designation or if there is no surviving designated Beneficiary, then the
Participant's surviving spouse shall be the Beneficiary. If there is no
surviving spouse to receive any benefits payable in accordance with the
preceding sentence, the participant's


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                                                                   EXHIBIT 10.22

estate shall be the Beneficiary. In the event any amount is payable under the
Plan to a minor, payment shall not be made to the minor, but instead be paid (a)
to that person's living parent(s) to act as custodian, (b) if that person's
parents are then divorced, and one parent is the sole custodial parent, to such
custodial parent, or (c) if no parent of that person is then living, to a
custodian selected by the Committee to hold the funds for the minor under the
Uniform Transfers or Gifts to Minors Act in effect in the jurisdiction in which
the minor resides. If no parent is living and the Committee decides not to
select another custodian to hold the funds for the minor, then payment shall be
made to the duly appointed and currently acting guardian of the estate for the
minor or, if no guardian of the estate for the minor is duly appointed and
currently acting within 60 days after the date the amount becomes payable,
payment shall be deposited with the court having jurisdiction over the estate of
the minor.

Section 6.5 Withholding.

      There shall be deducted from each payment made under this Plan or any
other compensation payable to the Participant (or Beneficiary) all taxes which
are required to be withheld by the Company in respect to such payment under this
Plan. The Company shall have the right to reduce any payment (or compensation)
by the amount of cash sufficient to provide the amount of said taxes.

Section 6.6 Amendment, Modification, Suspension or Termination.

      The Compensation Committee may amend, modify, suspend or terminate this
Plan in whole or in part, except that no amendment, modification, suspension or
termination shall have any retroactive effect to reduce any amounts allocated to
a Participant's Deferral Accounts (neither the policies themselves, nor the
death benefit described in Section 3.8(c) shall be treated as allocated to
Deferral Accounts). In the event that this Plan is terminated, the amounts
allocated to a Participant's Deferral Accounts shall be distributed to the
Participant or, in the event of his or her death, his or her Beneficiary in a
lump sum within 30 days following the date of termination.

Section 6.7 Governing Law.

      This Plan shall be construed, governed and administered in accordance with
the laws of the United States and to the extent not preempted by such law by the
laws of the State of California.

Section 6.8 Receipt or Release.

      Any payment to a Participant or the Participant's Beneficiary in
accordance with the provisions of this Plan shall to the extent thereof, be in
full satisfaction of all claims for benefits under this Plan against the
Committee and the Company. The Committee may require such Participant or
Beneficiary, as a condition precedent to such payment, to execute a receipt and
release to such effect.


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                                                                   EXHIBIT 10.22

Section 6.9 Effective Date.

      This Plan shall be effective as of November 1, 2000.

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                                                                   EXHIBIT 10.22


      IN WITNESS WHEREOF, this Plan is adopted as of November 1, 2000.

                              PACIFICARE HEALTH SYSTEMS, INC.


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                              By:
                              Title:


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