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                                                                    EXHIBIT 10.2


                               FIRST AMENDMENT TO
                          SECOND AMENDED AND RESTATED
                           1989 STOCK OPTION PLAN FOR
                          OFFICERS AND KEY EMPLOYEES OF
                         PACIFICARE HEALTH SYSTEMS, INC.

     This First Amendment, dated as of November  20, 1995 (the "Amendment"), to
the Second Amended and Restated 1989 Stock Option Plan for Officers and Key
Employees of PacifiCare Health Systems, Inc. (the "1989 Plan") hereby amends the
1989 Plan as follows:

1.   Section 4.2(b)  shall be deleted and replaced with the following:

     Subject to the provisions of Section 2.2, 4.2(a) , 4.2(c) and 8.2, Options
     shall become exercisable at such times and in such installments (which may
     be cumulative) as the Committee shall provide in the terms of each
     individual Option; provided, however, that by a resolution adopted after an
     Option is granted the Committee may in its absolute discretion, on such
     terms and conditions as it may determine to be appropriate and subject to
     Sections 4.2(a) and 4.2(c) accelerate the time at which such Option or any
     portion thereof may be exercised.

2.   Section 8.2 shall be deleted and replaced with the following:

     Section 8.2 - Merger, Consolidation, Acquisition, Liquidation or
Dissolution

     a.   Notwithstanding anything to the contrary in Section 4.2(a), Section
4.2(b) or any vesting provisions of any Award, any Award outstanding under the
Plan which has been held for at least six months shall become exercisable
immediately upon the effective date of a "Change of Control."   As used in this
Section 8.2, the term "Change of Control" shall mean 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 Act) other than UniHealth, a
California non-profit public benefit corporation ("UniHealth"), acquires
beneficial ownership (within the meaning of Rule 13d-3 of the Act), directly or
indirectly, of 20 percent or more of the voting common stock of the Company and
the beneficial ownership of the voting common stock of the Company owned by
UniHealth at that date is less than or equal to the beneficial ownership
interest of voting securities attributable to such other person or group; (v) a
dissolution or liquidation of the Company; or (vi) the Company ceases to be
subject to the reporting


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requirements of the Act as a result of a "going private transaction" (within the
meaning of the  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.

     b.     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 and acceleration of
exercisability.  All such determinations and interpretations by the Committee
shall be conclusive.

     c.   Each Participant shall receive at least 10 days' notice prior to the
effective date of the Change of Control that their Awards will be exercisable
upon the effective date of the Change of Control and the officers of the Company
shall make adequate provisions to permit all Participants to exercise their
Awards as of the effective date of the Change of Control.


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