<PAGE>

                                                                   EXHIBIT 10.32

          [FORM OF PERFORMANCE OPTION UNDER 2004 STOCK INCENTIVE PLAN]

                          VANGUARD HEALTH SYSTEMS, INC.

                       NONQUALIFIED STOCK OPTION AGREEMENT
                              (PERFORMANCE OPTION)

            THIS AGREEMENT (the "Agreement"), is made effective as of the _____
day of _____, 200_, (hereinafter called the "Date of Grant"), between Vanguard
Health Systems, Inc., a Delaware corporation (hereinafter called the "Company"),
and _______ (hereinafter called the "Participant"):

                                R E C I T A L S:

            WHEREAS, the Company has adopted the Vanguard Health Systems, Inc.
2004 Stock Incentive Plan (the "Plan"), which Plan is incorporated herein by
reference and made a part of this Agreement. Capitalized terms not otherwise
defined herein shall have the same meanings as in the Plan; and

            WHEREAS, the Committee has determined that it would be in the best
interests of the Company and its shareholders to grant the option provided for
herein (the "Option") to the Participant pursuant to the Plan and the terms set
forth herein.

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

            1. Grant of the Option. The Company hereby grants to the Participant
the right and option (the "Option") to purchase, on the terms and conditions
hereinafter set forth, all or any part of an aggregate of ______ Shares, subject
to adjustment as set forth in the Plan. The purchase price of the Shares subject
to the Option shall be $______ per Share (the "Option Price"). The Option is
intended to be a non-qualified stock option, and is not intended to be treated
as an option that complies with Section 422 of the Internal Revenue Code of
1986, as amended.

            2. Vesting.

            (a) Subject to the Participant's continued Employment with the
Company, the Option shall vest and become exercisable with respect to twenty
percent (20%) of the Shares initially covered by the Option on each of the
first, second, third, fourth and fifth anniversaries of the Date of Grant.

            At any time, the portion of the Option which has become vested and
exercisable as described above (or pursuant to Section 2(c) below) is
hereinafter referred to as the "Vested Portion".

            (b) If the Participant's Employment with the Company is terminated
for any reason, the Option shall, to the extent not then vested, be canceled by
the Company without

<PAGE>
                                                                               2

consideration and the Vested Portion of the Option shall remain exercisable for
the period set forth in Section 3(a).

            (c) Notwithstanding any other provisions of this Agreement to the
contrary, in the event of a Change in Control the Option shall, to the extent
not then vested and not previously canceled, immediately become fully vested and
exercisable.

            3. Exercise of Option.

            (a) Period of Exercise. Subject to the provisions of the Plan and
this Agreement, the Participant may exercise all or any part of the Vested
Portion of the Option at any time prior to the earliest to occur of:

            (i) the tenth anniversary of the Date of Grant;

            (ii) one year following the date of the Participant's termination of
      Employment due to death or "Disability"; and

            (iii) 90 days following the date of the Participant's termination of
      Employment for any reason other than due to the Participant's death or
      Disability; provided, however, if Section 3(b)(ii) of this Agreement would
      otherwise preclude the exercise of the Option following the termination of
      Employment, the first day of the 90 day period under this Section
      3(a)(iii) shall commence on the first day of the completion of any
      registration or qualification of the Option or Shares in accordance with
      Section 3(b)(ii) of this Agreement.

            For purposes of this Agreement:

            "Disability" shall mean "disability" as defined in any employment
      agreement then in effect between the Participant and the Company or if not
      defined therein or if there shall be no such agreement, as defined in the
      Company's long-term disability plan as in effect from time to time, or if
      there shall be no plan or if not defined therein, the Participant's
      becoming physically or mentally incapacitated and consequent inability for
      a period of six (6) months in any twelve (12) consecutive month period to
      perform his duties to the Company.

            (b) Method of Exercise.

            (i) Subject to Section 3(a), the Vested Portion of the Option may be
      exercised by delivering to the Company at its principal office written
      notice of intent to so exercise; provided that, the Option may be
      exercised with respect to whole Shares only. Such notice shall specify the
      number of Shares for which the Option is being exercised and shall be
      accompanied by payment in full of the Option Price. The payment of the
      Option Price may be made at the election of the Participant (i) in cash or
      its equivalent (e.g., by check), (ii) to the extent permitted by the
      Committee, in Shares having a Fair Market Value equal to the aggregate
      Option Price for the Shares being purchased and satisfying such other
      requirements as may be imposed by the Committee; provided, that such
      Shares have been held by the Participant for no less than six months (or
      such other period as established from time to time by the Committee in
      order to avoid adverse accounting

<PAGE>
                                                                               3

      treatment applying generally accepted accounting principles), (iii) partly
      in cash and, to the extent permitted by the Committee, partly in such
      Shares or (iv) if there is a public market for the Shares at such time,
      through the delivery of irrevocable instructions to a broker to sell
      Shares obtained upon the exercise of the Option and to deliver promptly to
      the Company an amount out of the proceeds of such Sale equal to the
      aggregate option price for the Shares being purchased. No Participant
      shall have any rights to dividends or other rights of a stockholder with
      respect to Shares subject to an Option until the Participant has given
      written notice of exercise of the Option, paid in full for such Shares
      and, if applicable, has satisfied any other conditions imposed by the
      Committee pursuant to the Plan.

            (ii) Notwithstanding any other provision of the Plan or this
      Agreement to the contrary, the Option may not be exercised prior to the
      completion of any registration or qualification of the Option or the
      Shares under applicable state and federal securities or other laws, or
      under any ruling or regulation of any governmental body or national
      securities exchange that the Committee shall in its sole discretion
      determine to be necessary or advisable.

            (iii) Upon the Company's determination that the Option has been
      validly exercised as to any of the Shares, the Company shall issue
      certificates in the Participant's name for such Shares. However, the
      Company shall not be liable to the Participant for damages relating to any
      delays in issuing the certificates to him, any loss of the certificates,
      or any mistakes or errors in the issuance of the certificates or in the
      certificates themselves.

            (iv) In the event of the Participant's death, the Vested Portion of
      the Option shall remain exercisable by the Participant's executor or
      administrator, or the person or persons to whom the Participant's rights
      under this Agreement shall pass by will or by the laws of descent and
      distribution as the case may be, to the extent set forth in Section 3(a).
      Any heir or legatee of the Participant shall take rights herein granted
      subject to the terms and conditions hereof.

            (v) As a condition to exercising the Option, the Participant shall
      become a party to the Stockholders Agreement.

            4. No Right to Continued Employment. The granting of the Option
evidenced hereby and this Agreement shall impose no obligation on the Company or
any Affiliate to continue the Employment of the Participant and shall not lessen
or affect the Company's or its Affiliate's right to terminate the Employment of
such Participant.

            5. Legend on Certificates. The certificates representing the Shares
purchased by exercise of the Option shall be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under the Plan
or the rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Shares are listed, and any
applicable Federal or state laws, and the Committee may cause a legend or
legends to be put on any such certificates to make appropriate reference to such
restrictions.

            6. Transferability. The Option may not be assigned, alienated,
pledged, attached, sold or otherwise transferred or encumbered by the
Participant otherwise than by will or by the laws of descent and distribution,
and any such purported assignment, alienation, pledge,

<PAGE>
                                                                               4

attachment, sale, transfer or encumbrance shall be void and unenforceable
against the Company or any Affiliate; provided that the designation of a
beneficiary shall not constitute an assignment, alienation, pledge, attachment,
sale, transfer or encumbrance. No such permitted transfer of the Option to heirs
or legatees of the Participant shall be effective to bind the Company unless the
Committee shall have been furnished with written notice thereof and a copy of
such evidence as the Committee may deem necessary to establish the validity of
the transfer and the acceptance by the transferee or transferees of the terms
and conditions hereof. During the Participant's lifetime, the Option is
exercisable only by the Participant.

            7. Withholding. The Participant may be required to pay to the
Company or any Affiliate and the Company shall have the right and is hereby
authorized to withhold from any payment due or transfer made under the Option or
under the Plan or from any compensation or other amount owing to a Participant
the amount (in cash, Shares, other securities, other Awards or other property)
of any applicable withholding taxes in respect of the Option, its exercise or
any payment or transfer under or with respect to the Option or the Plan and to
take such other action as may be necessary in the opinion of the Committee to
satisfy all obligations for the payment of such withholding taxes.

            8. Securities Laws. Upon the acquisition of any Shares pursuant to
the exercise of the Option, the Participant will make or enter into such written
representations, warranties and agreements as the Committee may reasonably
request in order to comply with applicable securities laws or with this
Agreement.

            9. Notices. Any notice necessary under this Agreement shall be
addressed to the Company in care of its Secretary at the principal executive
office of the Company and to the Participant at the address appearing in the
personnel records of the Company for the Participant or to either party at such
other address as either party hereto may hereafter designate in writing to the
other. Any such notice shall be deemed effective upon receipt thereof by the
addressee.

            10. Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO CONFLICTS
OF LAWS.

            11. Option Subject to Plan and Stockholders Agreement. By entering
into this Agreement the Participant agrees and acknowledges that the Participant
has received and read a copy of the Plan and the Stockholders Agreement. The
Option is subject to the Plan and the Stockholders Agreement. The terms and
provisions of the Plan and the Stockholders Agreement as it may be amended from
time to time are hereby incorporated herein by reference. In the event of a
conflict between any term or provision contained herein and a term or provision
of the Plan or the Stockholders Agreement, the applicable terms and provisions
of the Plan or the Stockholders Agreement, as applicable will govern and
prevail. In the event of a conflict between any term or provision of the Plan
and any term or provision of the Stockholders Agreement, the applicable terms
and provisions of the Stockholders Agreement will govern and prevail.

            12. Signature in Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

<PAGE>
                                                                               5

            IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

                                          VANGUARD HEALTH SYSTEMS, INC.

                                          By: __________________________________

Agreed and acknowledged as

of the date first above written:

________________________________