[SEAL OF MISSOURI]

STATE OF MISSOURI
OFFICE OF ADMINISTRATION
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
REQUEST FOR PROPOSAL


                                                      REQ#:  886913750
RFP NO.  B900676                                      BUYER:  GARY EGGEN
TITLE:  MEDICAID MANAGEMENT INFORMATION SYSTEM        PHONE NO.:  (573)751-2497
ISSUE DATE:  APRIL 23, 1999                           E-MAIL:
                                                      EGGENG@MAIL.OA.STATE.MO.US

RETURN PROPOSAL NO LATER THAN:   06/14/99 AT 2:00 PM

RETURN PROPOSAL TO:
                 DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
                                    301 WEST HIGH STREET, ROOM 580
                                    PO BOX 809
                                    JEFFERSON CITY MO 65102-0809

CONTRACT PERIOD:  JULY 1, 1999 THROUGH JUNE 30, 2000

DELIVER SUPPLIES/SERVICES FOB DESTINATION TO THE FOLLOWING ADDRESS:

                           DEPARTMENT OF SOCIAL SERVICES
                           DIVISION OF MEDICAL SERVICES
                           615 HOWERTON COURT
                           PO BOX 6500
                           JEFFERSON CITY, MO 65102

The offeror hereby declares understanding, agreement and certification of
compliance to provide the items and/or services, at the prices quoted, in
accordance with all requirements and specifications contained herein and the
Terms and Conditions Request for Proposal (Revised 6/18/98). The offeror further
agrees that the language of this document shall govern in the event of a
conflict with his/her proposal. The offeror further agrees that upon receipt of
an authorized purchase order from the Division of Purchasing and Materials
Management or when this document is countersigned by an authorized official of
the State of Missouri, a binding contract shall exist between the offeror and
the State of Missouri.

                               SIGNATURE REQUIRED

Authorized Signature  /s/ DEBORAH ANDERS
Printed Name          Deborah Anders
Title                 Vice President and General Manager
                      Commercial Services
Company Name          GTE Data Services, Inc.
Mailing Address       P. O. Box 290152
City, State, Zip      Temple Terrace, FL  33687
Vendor Number if known
Federal Employer ID No. 13-2595219

Phone No.             (813) 978-5290
FAX No.               (813) 978-5614
email address         Deborah.anders@telops.gte.com

Date 6.17.99
[X] Check here if RFP was downloaded from


                        NOTICE OF AWARD (State Use Only)

Accepted by the State of Missouri as follows:
Contract No.
Contract Period
Buyer
Date
Director



<PAGE>


                                TABLE OF CONTENTS

      Section One:              General Information and Background
      Section Two:              Contract Implementation Requirements
      Section Three:            Scope of Work
      Section Four:             Performance Standards and Requirements
      Section Five:             Enhancements
      Section Six:              Project Assessment Quotations
      Section Seven:            Contractual Requirements
      Section Eight:            Offerors Instructions and Requirements
      Section Nine:             Offeror Requirements for MBE/WBE Participation

      EXHIBITS                  A:   Pricing Schedule: Scope of Work
                                B:   Pricing Schedule: Project Assessment
                                     Quotations
                                C:   Offeror's Experience

      ATTACHMENTS               A:   Medicaid Data Statistics
                                B:   Claim Forms
                                C:   Missouri Map of Managed Care Regions
                                D:   Lotus Notes Applications
                                E:   Claims Processing Schedule for Fiscal Year
                                     1999
                                F:   Hardware and Software Currently Used
                                G:   DMS Network Configuration

SPECIAL NOTICES:

       PRE-PROPOSAL CONFERENCE:  Thursday, May 13, 1999 at 1:00 p.m.
                                 See Paragraph 1.1.

       BONDING REQUIREMENTS:

     o    PROPOSAL SECURITY DEPOSIT: In the amount of $50,000.00 required of all
          offerors. See Paragraph 8.1.6.

     o    CONTRACT PERFORMANCE SECURITY DEPOSIT: In the amount of $1,000,000.00
          renewable required of the successful contractor. See Paragraph 7.8.

       ATTACHMENTS: The offeror is advised that the attachments to this document
       include hard copy documents that are unable to be appropriately converted
       to an electronic format. The attachments provide additional information
       and instruction for the offeror's reference. In the event this document
       was downloaded from the Division of Purchasing and Materials Management's
       Internet web site, the offeror must contact the buyer of record as
       indicated on the front page of this document to obtain copies of the
       attachments prior to submitting a proposal. It shall be the sole
       responsibility of the offeror to request the attachments. The offeror
       shall not be relieved of any responsibility for performance under the
       contract due to the failure of the offeror to obtain copies of the
       attachments.

       PARAGRAPH ADDED BY AMENDMENT # 002:
       QUESTIONS/ANSWERS: Questions asked regarding the RFP requirements will be
       posted on the Division of Purchasing and Materials Management's Website
       along with the answers provided by the State. Prospective offerors are
       strongly encouraged to submit all questions no later than one week prior
       to the RFP closing date. Questions received after such time may not be
       responded to by the State of Missouri.


<PAGE>



1.       GENERAL INFORMATION AND BACKGROUND:

1.1      PRE-PROPOSAL CONFERENCE:

           A pre-proposal conference regarding this Invitation for Bid will be
           held on Thursday, May 13, 1999 at 1:00 p.m., in Room 510 of the Harry
           S Truman State Office Building, 301 W. High Street, Jefferson City,
           Missouri.

           All potential offerors are encouraged to attend the pre-proposal
           conference in order to ask questions and provide comments on the RFP.
           Attendance is not required in order to submit a response; however,
           offerors are encouraged to attend since information relating to this
           RFP will be discussed in detail. Offerors should bring a copy of the
           RFP since it will be used as the agenda for the pre-proposal
           conference.

           Offerors are strongly encouraged to advise the Division of Purchasing
           and Materials Management within five (5) working days prior to the
           scheduled pre-bid conference of any special accommodations needed for
           persons with disabilities who will be attending the conference so
           that these accommodations can be made.

           Offerors are also encouraged to mail, fax, or e-mail their questions
           regarding the RFP prior to the pre-proposal conference. Questions
           should be received prior to the end of business on Tuesday, May 11,
           1999. Questions should be addressed to Gary Eggen, Division of
           Purchasing and Materials Management, Room 580, Truman State Office
           Building, 301 W. High Street, PO Box 809, Jefferson City, MO 65102;
           facsimile number: (573) 751-7276; e-mail address:
           eggeng@mail.oa.state.mo.us.

1.2      PURPOSE:

           This document constitutes a request for sealed proposals from
           prospective offerors to implement, operate, enhance, maintain and
           turnover to the State or its agent, a Department of Health and Human
           Services (HHS) certified Medicaid Management Information System
           (MMIS) for the State of Missouri Department of Social Services (DSS),
           Division of Medical Services (DMS), in accordance with the
           requirements, terms and conditions defined herein.

           This document has been submitted for approval to the Health Care
           Financing Administration (HCFA). Federal approval is required prior
           to the commitment of the federal financing share of funds under the
           contract. Therefore, no contract will be awarded unless such federal
           approval is received.

           DMS is designated as the agency charged with the administration of
           the state's medical assistance and the federal Medicaid programs. The
           purpose of these programs is to purchase and monitor health care
           services for low income individuals who are elderly, disabled, blind,
           members of families with dependent children, children and pregnant
           women in poverty, refugees and children in state custody. These
           services are rendered through both fee-for-service and managed care
           environments.

1.3      MBE/WBE PARTICIPATION REQUIREMENTS:

           MANDATORY MINORITY BUSINESS ENTERPRISE (MBE) AND WOMEN BUSINESS
           ENTERPRISE (WBE) PARTICIPATION REQUIREMENTS: This RFP requires MBE
           and WBE participation in the performance of the contract. Refer to
           paragraphs 7.7 and 9 and all subparagraphs for specific participation
           requirements and opportunities. THE OFFEROR IS ADVISED TO REVIEW THE
           INFORMATION CAREFULLY. THE OFFEROR IS CAUTIONED THAT THE MBE/WBE
           PARTICIPATION REQUIREMENTS CONTAINED HEREIN ARE DIFFERENT THAN THE
           MBE LANGUAGE CONTAINED IN PREVIOUSLY ISSUED PROCUREMENT DOCUMENTS.

1.4      OFFEROR'S CONTACTS:

           Offerors and their agents (including subcontractors, employees,
           consultants, or anyone else acting on their behalf) must direct all
           of their questions or comments regarding the RFP, the evaluation,
           etc. to the buyer of record indicated on the first page of this RFP.
           Offerors and their agents may not contact any state employee
           regarding any of these matters during the solicitation and evaluation
           processes. Inappropriate contacts are grounds for suspension and/or
           exclusion from specific procurements. Offerors and their agents who
           have questions regarding this matter should contact the buyer of
           record.

1.5      CURRENT CONTRACT OPERATIONS:

           The current contractor is GTE Data Services, Inc. (GTEDS). Claims
           processing and related contract operations commenced July 1, 1993.
           The following paragraphs provide a brief overview of the current
           claims processing operations. Refer to Attachment A for Medicaid data
           statistics.

1.5.1      Paper claims are submitted via a series of post office boxes to GTEDS
           in Jefferson City, Missouri. Paper claims are manually screened in
           the mailroom for certain key elements. Claims are imaged and assigned
           a thirteen digit Internal Control Number (ICN).

1.5.2 Claims are also submitted on tape, diskette, PC to PC, on-line and file
transfer software.

1.5.3      Accepted paper and electronic claims data is transmitted by dedicated
           phone lines to GTEDS' Fort Wayne, Indiana data center where the MMIS
           is operated. Claims keyed on-line are transmitted immediately. Claims
           keyed in batch are transmitted nightly. Electronic claims are also
           uploaded and transmitted nightly.

1.5.4      Suspended claim correction, for all claims, is done on-line by DMS
           and contractor staff in Jefferson City. Worksheets are printed in
           Jefferson City for those claims that need to be routed to consultants
           for manual review.

1.5.5      Claims and encounters are processed utilizing the coding systems
           selected by DMS. Currently these are HCPCS and local procedure codes,
           ICD-9-CM for diagnosis codes, NDC for drugs, HCPCS local codes for
           dental and revenue codes for inpatient claims.

1.5.6      Data on paid and denied claims is used to create files which are
           transmitted to the State Data Center (SDC) in Jefferson City in order
           to print the following items:

(1) Provider Earnings Statements (annually) (2) Provider Checks (semi-monthly)
(3) Remittance Advices (RA) including suspended claims list (semi-monthly)

1.5.7      The following fee-for-service claim forms are used (refer to
           Attachment B for samples of each claim form):

(1) HCFA 1500 (12-90) (2) HCFA 1450 (UB 92)
(3) Nursing Home (TAD) (Proprietary) (4) Pharmacy (Proprietary) (5) Dental
(Proprietary) (6) Medicare Part B sticker (Proprietary)
(7) Institutional Crossover (Medicare Part A) sticker (Proprietary) (8) SNF
Medicare sticker (Proprietary) (9) Nurse Assistant Training (NAT) (Proprietary)

1.5.8 The following fee-for-service electronic claim layouts are used:

(1) NSF
(2) NCPDP (Current versions - 1.0, 3.2, 3.C) (3) UB 92 (4) FENIX (Proprietary
nursing home software)

1.5.9      Medicare carriers and intermediaries transmit electronic claims to
           GTEDS. DMS currently has established trading partner agreements with
           ten (10) Medicare carriers and intermediaries. A list of Medicare
           carriers and intermediaries is included in Attachment A.

1.5.10     Health care service payments are made fee-for-service or through a
           per member, per month capitation payment. In addition to the regular
           fee-for-service program, DMS also administers the MC+ Managed Care
           Program. There are currently ten (10) health plans contracted with
           DMS to provide health care services to Medicaid eligibles in three
           (3) distinct regions of the state. A map of the regions is shown as
           Attachment C. The health plans are paid a per member, per month
           capitation payment to provide all contracted services. The health
           plans are currently required to set up a leased or dedicated
           telecommunications link with GTEDS through which files are
           transmitted back and forth.

1.5.11     GTEDS contracts with First Data Bank for the drug file. GTEDS is
           required to maintain the full master file including all prescription
           and non-prescription drugs. First Data Bank provides an updated tape
           file on a weekly basis.

1.5.12     GTEDS contracts with First Data Bank for the Drug Utilization Review
           (DUR) modules required to perform prospective drug utilization
           review. GTEDS currently supports the following modules:

(1) Drug-to-Drug Interactions (2) Dose/Range Checking (3) Duplicate Therapy (4)
Drug/Disease Conflict (5) Minimum/Maximum Daily Dose (6) Drug Allergy Alerts
(7) Drug Side Effects (currently inactive) (8) Duration of Therapy (DMS
proprietary module) (9) Early Refill (DMS proprietary module)

1.5.13     GTEDS provides daily reports that indicate all additions and changes
           to the reference file. Changes to the medical criteria, institutional
           criteria and system parameter files are performed by GTEDS and
           documented by system task requests (STR). Updates to the procedure,
           drug, diagnosis and revenue code file are performed by DMS.

1.5.14     GTEDS provides and supports Lotus Notes applications to select DMS
           staff. Lotus Notes is used for electronic correspondence between the
           contractor and DMS, as well as, a multitude of tracking and
           monitoring databases for adhoc requests, STRs, system problem
           assistance requests (SPAR) and other various logging and tracking
           functions between DMS and GTEDS. Lotus Notes is also utilized as part
           of the provider enrollment application. Most of the existing Lotus
           Notes views and applications in use by DMS were customized by GTEDS.
           Refer to Attachment D for sample Lotus Notes application screens.

1.5.15     GTEDS receives daily update transmissions of the eligibility file
           from the DSS, Division of Data Processing (DDP) which are created as
           a result of updates made to the Income Maintenance and related data
           bases.

1.5.16     GTEDS receives daily update transmissions of the MC+ enrollment file
           from DDP that are created as a result of updates to the MC+
           enrollment file by the enrollment broker or by DSS staff.

1.5.17     Providers may access eligibility information through a point of
           service (POS) network vendor or the audio response unit (ARU). The
           POS eligibility verification system gives the provider access to
           eligibility information through a POS terminal. The transaction is
           transmitted through a network vendor directly to the data center. The
           ARU is an interactive system that the provider can access through a
           touch-tone telephone. The provider receives a computer-synthesized
           voice response with all pertinent recipient eligibility information.

1.5.18     GTEDS produces and mails recipient remittance notices on a monthly
           basis for a quarter's worth of services. The recipient population is
           divided into three zip code regions with one region produced monthly.

1.5.19     GTEDS is responsible for staffing several ancillary units that
           include Recipient Services Unit (RSU), Third Party Liability (TPL)
           Lead Verification Unit and Drug Rebate Dispute Resolution Unit.

1.5.20     GTEDS is responsible for the on-line provider manual format and
           maintenance process through FolioViews and publication through the
           Internet. DMS writes the original text and updates on-line through
           FolioViews.

1.5.21     GTEDS is responsible for the maintenance of the Advanced Surveillance
           and Utilization Review Subsystem (SURS) and the Management and
           Administrative Reporting Subsystem (MARS).

1.5.22     The system is a public domain MMIS and the majority of the
           application programs are written in VS COBOL II or COBOL for MVS.
           GTEDS currently uses SAS for adhoc reports and CICS as the
           teleprocessing monitor.

1.5.23     The Decision Support System is currently being developed by The
           MEDSTAT Group. On an ongoing basis, GTEDS compiles and transmits
           monthly extracts to The MEDSTAT Group of all claims, recipient,
           provider and various reference files in the MMIS.

1.5.24     GTEDS runs weekly adjudication cycles with bimonthly financial cycles
           based upon a schedule established by DMS. Refer to Attachment E for
           FY `99 Claims Processing Schedule.

1.5.25     GTEDS compiles requests for plastic Medicaid identification cards.
           The request data is transmitted nightly to a subcontractor who is
           responsible for creation and distribution of the cards. These cards
           are received by the United States Postal Service (USPS) within
           twenty-four (24) hours of being created.

1.6      INTERFACES WITH STATE SYSTEM:

           A variety of electronic interfaces currently exist between the
           contractor and various state systems. The only teleprocessing
           interface involves the contractor's use of IBM's SNA Network
           Interconnection software to connect the SDC with the contractor's
           mainframe. This allows the State's on-line terminals to access both
           Income Maintenance data and other state files on the State's computer
           and MMIS data on the contractor's computer.

1.6.1    DDP provides the following daily update file transactions:

(1)      Buy-In
(2)      Alternative Care
(3)      Income Maintenance
(4) MC+ Enrollment (Lock-in) (5) Third-Party Resources and Carrier File (6)
Hospice (7) NAT CNA Register (8) NAT Training Agency Register

1.6.2      GTEDS provides a copy of the recipient master file on a monthly basis
           to DDP for use in State systems. Scheduled recipient file
           reconciliations are performed upon the request of DMS.

1.6.3 GTEDS transmits the following claim related files to DDP according to the
schedules shown:

(1)      Drug Utilization Review Extract File (monthly)
(2)      Paid Claims History File (monthly)
(3)      Prior Authorization File (monthly)
(4)      Provider Checks (semi-monthly)
(5)      Provider Earning Statement (1099) (monthly)
(6)      Quality Control File (semi-monthly)
(7)      Recipient Explanation of Medical Benefits (monthly)
(8)      Remittance Advices and Suspended Claims Lists (semi-monthly)

1.7   GTEDS ALSO MAINTAINS THE FOLLOWING INTERFACES WITH OTHER OUTSIDE ENTITIES:

(1) SDC (2) DSS/DDP
(3) MC+ Health Plans (4) TPL Revenue Maximization Contractor
(5) NEIC (6) HCFA
(7) MEDSTAT (Decision Support System) (8) Medical Review Services (MRS) (9) ARU
eligibility verification systems (10) POS network vendors (11) EMC billers (12)
PharMark

2. CONTRACT IMPLEMENTATION REQUIREMENTS

2.1      PLANNING TASK:

2.1.1      In executing the Planning Task, the contractor shall conduct a
           detailed survey of the present MMIS to refine and finalize the
           requirements and work plan included as part of the contract.

2.1.2      DMS will provide all available relevant documentation on current MMIS
           operations and provide details on MMIS enhancement requirements.
           Policy will be determined or developed where necessary. At the
           contractor's request, DMS will clarify DMS policy, regulations and
           procedures. The contractor shall familiarize the contractor team with
           Missouri Medicaid policy and services and Missouri MMIS requirements.
           The contractor shall develop written procedures for DMS approval for
           safe off-site storage and periodic copying of programs and data files
           of MMIS as well as provide documentation defining measures taken to
           ensure security of the MMIS as defined in Paragraph 3.10.3 herein.

2.1.3      DMS will provide documentation and details of the proposed work plan
           for turnover, coordinate communications and meetings between the
           incumbent contractor and the awarded contractor, and review and
           approve (or request amendment of) the Planning Task deliverables. The
           contractor shall finalize the contractor work plan to reflect
           findings of this task including proposed start dates to ensure
           meeting the completion dates for enhancements. Progress against the
           work plan shall be reported to DMS by weekly written reports and at
           weekly review meetings with DMS. The contractor shall obtain written
           approval from DMS of Planning Task deliverables.

2.2      ACCEPTANCE TESTING TASK:

           The Acceptance Testing Task shall provide assurance that the MMIS
           system installed by the contractor meets specifications, and that the
           contractor is ready to perform all contract functions and meet all
           contract requirements. As such, the Acceptance Testing Task is more
           comprehensive than the system testing completed in the Transfer Task
           and is used to determine contractor readiness to administer all
           phases of the MMIS.

           The Acceptance Testing Task shall be divided into three subtasks: the
           parallel test, the structured data test and the readiness test.

2.2.1      Parallel Test: The parallel test shall measure the contractor's
           ability to transfer the existing MMIS onto the contractor's hardware
           and provide output that mirrors the production system operated by the
           incumbent. The contractor shall be provided with input files and must
           produce reports from the MARS, SURS, Provider, Reference, Recipient
           and Claims Subsystems.

           DMS will design parallel test procedures, acquire input files from
           the incumbent and provide such files to the contractor, review output
           from parallel test, inform contractor of results and assist in
           correction of any problems identified through the parallel test. The
           contractor shall perform parallel tests producing reports and
           correcting errors identified by DMS staff through output of parallel
           test and rerun test to show corrected reports.

2.2.2      Structured Data Test: The structured data test shall measure the
           contractor's ability to process claims submitted on paper or through
           electronic means (tape, POS, etc.) and all other transactions,
           including the ability to correctly resolve suspended claims. The
           contractor shall be provided with claims and other transactions and
           shall perform sorting, imaging, batching, and data entry and shall
           process these claims to adjudication, and transactions to
           finalization.

           DMS will design structured data test procedures, provide input for
           structured data test in the form of claims and other transactions,
           review output from structured data test, inform contractor of results
           and assist in correction of any problems identified through the
           structured data test. The contractor shall staff resolutions, exam
           entry, and medical policy units prior to initiation of structured
           data test with sufficient personnel to successfully process the test
           claims and transactions. The structured data test shall require one
           (1) or more adjudication cycles for all claims and other
           transactions. Any claims that suspend must be fully adjudicated. The
           contractor shall correct errors identified by DMS staff through
           output of structured data test and rerun test to show corrected
           procedures. The contractor shall also accept eligibility files from
           DDP. All eligibility transactions must be properly sequenced and
           applied.

2.2.3      Readiness Test: The readiness test shall measure the contractor's
           ability to process production volume of claim transactions. The
           contractor shall be provided with five (5) days of actual receipts
           from the incumbent's warehouse of finalized claims and shall process
           these claims through adjudication. In addition to paper claims, this
           test shall include EMC claims. Also included in the test shall be
           mailroom procedures for returning claims to providers. All claims
           handling, imaging, data entry and error resolution functions must be
           performed by the contractor except as otherwise specified in this
           document.

           DMS will design readiness test procedures, provide five (5) days of
           actual claims and other transactions for the readiness test, inform
           contractor of results and assist in correction of any problems
           identified through the readiness test. The contractor shall staff
           complete document control, resolutions, exam entry and medical policy
           units prior to initiation of readiness test. The contractor shall
           correct errors identified by DMS staff through output of readiness
           test.

2.3      MAILING:

           The contractor shall submit a plan, for DMS approval, prior to
           implementation of the MMIS, which demonstrates that appropriate
           procedures will be implemented to secure the least expensive rates on
           all pass-through postage. This must include procedures for
           maintaining CASS certification with the United States Post Office and
           identifying the name and function of any software used. This plan
           must also demonstrate that this function will be constantly reviewed
           to ensure that only the lowest possible rate continues to be passed
           through to DMS.

2.4      IMPLEMENTATION TASK:

2.4.1      During the Implementation Task, the contractor shall implement the
           Missouri MMIS. Implementation shall include all general and specific
           scope of requirements, as well as, any enhancements scheduled on
           contract implementation.

2.4.2      Processing of all claim and encounter types must be implemented
           simultaneously. All claims and encounters received by the incumbent
           but not entered shall be turned over to DMS, or its designated agent,
           on June 30, 2000, for processing by the contractor. A maximum of two
           (2) days receipts may be turned over. Claims and encounters in excess
           of this amount shall be processed at the cost of the incumbent.

2.4.3      The suspense files created during the last adjudication cycle of June
           2000, the last pseudo-adjudication cycle of June 2000 and any
           resulting suspense file worksheet data shall be processed by the
           contractor.

2.4.4      The incumbent shall create the recipient notice files in June 2000.
           These files shall be turned over to the contractor for processing.

2.4.5      DMS will coordinate and monitor conversion activities, including
           notification to the providers of a change of contractor and the date
           from which all claims and encounters will be submitted to such
           contractor.

2.4.6      DMS will arrange for transfer of all required files. The contractor
           shall accept all current required computer files from the State.
           These files shall be received from the incumbent during June 2000.
           The contractor shall install all computer files, verify accuracy of
           files, correct any problems identified during final system test and
           notify DMS of acceptance of the MMIS system and computer files from
           the State.

2.5      TURNOVER TASK:

           Prior to the conclusion of the resulting contract, the contractor
           shall provide assistance in turning over to DMS, or its designated
           agent, a HHS certified MMIS existing at the time of contract
           termination.

           DMS will notify the contractor at least six (6) months prior to the
           end of this MMIS contract of DMS' intent to transfer the system. DMS
           will coordinate the transfer of MMIS software and master files, and
           arrange for the turnover of the operation of the MMIS.

2.5.1    The contractor shall provide turnover services as follows:

2.5.1.1  Software:

(1)               At least one hundred eighty (180) days prior to termination of
                  the resulting contract, the contractor shall provide to DMS,
                  or its designated agent, a complete copy of the most current
                  version of the MMIS on 3490 cartridges compressed.

                  This software shall be a complete copy of the production
                  system in operation at this time and shall also include the
                  most current version of all data files. The software shall
                  include source programs, copy modules and job control language
                  statements, all of which must be in fixed eighty (80)
                  character format, or other format as specified by DMS.

(2)               Upon the termination date of the resulting contract, the
                  contractor shall provide to DMS, or its designated agent, a
                  complete copy of the most current version of the MMIS on 3490
                  cartridges compressed. This software shall be a complete copy
                  of the production system in operation at the time of the
                  turnover and shall also include the most current version of
                  all data files. This software shall include source programs,
                  copy modules and job control language statements, all of which
                  must be in fixed eighty (80) character format, or other format
                  as specified by DMS.

(3)               Additionally, the contractor shall comply, in writing, with
                  any individual request for information submitted by DMS or its
                  designated agent.

2.5.1.2    The contractor shall cooperate with DMS in transferring to DMS, or
           its designated agent, all post office box numbers and telephone
           numbers that have been published for use in the Medicaid program. DMS
           will determine which box numbers and telephone numbers apply to this
           requirement.

2.5.2    The contract shall provide post turnover services as follows:

2.5.2.1    Claims and encounters on hand at termination of contract: The volume
           of claims and encounters on hand on the date of contract termination
           should not exceed two (2) working days average claims and encounters
           receipts. The contractor shall process at its own cost all claims and
           encounters in excess of two (2) working days average claims and
           encounters receipts.

2.5.2.2    System malfunctions: The contractor shall be responsible for, and
           must correct at no cost to DMS, any malfunctions which existed in the
           system prior to turnover or which were caused by the contractor's
           turnover activities.

3.       SCOPE OF WORK

3.1      GENERAL REQUIREMENTS:

           The contractor shall operate and maintain the MMIS in accordance with
           the provisions and requirements set forth in this document.

3.1.1    Enhancements shall be developed and implemented on a phased and
         scheduled basis.

3.1.2      The MMIS shall meet all certification and recertification
           requirements established by the Health Care Financing Administration
           (HCFA) of the United States Department of Health and Human Services
           (HHS), and shall correctly process and adjudicate all submitted
           claims, encounters and other transactions according to the policies
           of the State of Missouri Department of Social Services (DSS),
           Division of Medical Services (DMS).

3.1.3 The contractor shall perform the following eight (8) major tasks:

(1)      Planning
(2)      Transfer
(3) Acceptance Testing (4) Implementation (5) Operation (6) Enhancement (7)
Modification (8) Turnover

3.1.4      For each of the major tasks, the contractor shall develop a work plan
           to be approved by DMS to monitor progress. The format and detail of
           the work plan shall comply with descriptions set forth in the
           resulting contract. For all contractor deliverables that require DMS
           review and approval, DMS will have fifteen (15) working days to
           perform its review, unless specifically stated otherwise.

3.1.5 Replacement of the existing Missouri MMIS system with any other system
shall not be permitted.

3.1.6      Unless otherwise specified herein, the contractor shall be solely
           responsible for furnishing all material, labor, facilities, equipment
           and supplies necessary to perform the services required in this
           Request for Proposal.

3.1.7      Contractor personnel shall not respond directly to provider
           inquiries, attend provider meetings, or correspond directly with
           providers unless prior approved by DMS. This limitation also applies
           to contractor contact with provider associations and all other groups
           representing Missouri Medicaid providers.

3.1.8      The contractor agrees and understands DMS' agreement to the
           contract is predicated, in part and among other considerations,
           on the utilization of the specific individuals and/or personnel
           qualifications as identified and/or described in the contractor's
           proposal. Therefore, the contractor agrees that no substitutions
           of such specific individuals and/or personnel qualifications
           shall be made without the prior written approval of DMS. The
           contractor further agrees that any substitution made pursuant to
           this paragraph must be equal to or better than originally
           proposed and that DMS' approval of a substitution shall not be
           construed as acceptance of the substitution's performance
           potential. DMS will not unreasonably withhold approval of a
           substitution.

3.1.9      During the course of the contract, DMS reserves the right to require
           the contractor to reassign or otherwise remove from the project any
           employee of the contractor found unacceptable by DMS. DMS will not
           unreasonably exercise the rights reserved under this paragraph.

3.1.10     The contractor shall not hire any personnel who are employees of DSS
           or who were employees of DSS within six (6) months prior to the date
           of their employment by the contractor, unless prior written approval
           is obtained from either the Director or the Deputy Director of the
           Department of Social Services.

3.2      STATE OWNERSHIP:

           The contractor agrees that the United States Department of Health and
           Human Services and the State of Missouri shall receive a
           royalty-free, nonexclusive, and irrevocable license to reproduce,
           publish, or otherwise use, and to authorize others to do so, all
           software, instructions, files, and documentation comprising the
           Missouri MMIS. A fundamental obligation which shall be imposed on the
           contractor herein is the transfer by the contractor to the State of
           Missouri of all ownership rights in the complete MMIS system,
           including any and all performance-enhancing software and operational
           plans, whether developed or obtained by the contractor in the course
           of performance under the contract or before it. This provision is not
           subject to limitation due to characterization of any part of the
           system as proprietary or by failure to claim for the cost thereof,
           but shall exclude commercially available third party proprietary
           software. In the event the contractor develops software tools or
           similar items for the Missouri MMIS that may have utility in other
           system applications, ownership of these software tools or similar
           items shall remain with the contractor.

3.2.1      In the event the contractor develops software tools or similar items
           for testing on non-MMIS functions that may have utility in other
           systems applications, ownership of these software tools or similar
           items shall remain with the contractor.

3.2.2      The contractor shall convey to DMS copies of system documentation,
           operating instructions and procedures, and all data processing
           programs, or portions thereof, which are developed by employees of
           the contractor or by any subcontractor as part of the contract.

3.2.3      The contractor shall incorporate the provisions of this section in
           any subcontract which relates to the development or operation of the
           Missouri MMIS.

3.3      WARRANTY:

           Throughout the effective period of the contract, the contractor shall
           correct all errors and design deficiencies in the system, and replace
           incorrect or defective documentation within one (1) week from
           notification of such by DMS to the contractor or within such period
           as may be necessary to make corrections using all due diligence and
           dispatch as agreed upon between DMS and the contractor. If the
           contractor fails to repair an identified error, deficiency, or defect
           within such period, the State of Missouri may, at its sole
           discretion, act to repair such error, deficiency, or defect, and the
           contractor expressly agrees to reimburse the State of Missouri for
           all reasonable costs incurred as a result of such act by the State.

3.3.1      For one (1) full year following the expiration date of the contract,
           all errors and design deficiencies which existed in the system turned
           over to the State of Missouri by the contractor as a result of the
           System Turnover Task shall be corrected by the contractor at the
           expense of the contractor.

3.3.2      Deficiencies properly noted prior to expiration of this warranty
           shall be covered regardless of such expiration. Enhancements and
           other changes undertaken by the State outside the contract shall not
           be covered by this warranty.

3.3.3      The contractor shall ensure that all software and hardware used in
           the operation of the MMIS continues to be century compliant. All
           modifications, maintenance and enhancements to the MMIS must be
           developed, tested and implemented in a manner that ensures continued
           century compliance. All date fields must be in full date expansion
           and in standard format throughout the MMIS. The contractor shall
           employ the industry standard sliding logic windowing for incoming
           date fields.

3.4      COORDINATION OF PERFORMANCE:

           The contractor shall, within five (5) days after award of the
           contract, submit written identification and notification to DMS of
           the name, title, address, and telephone number of one (1) individual
           within its organization as a duly authorized representative to whom
           all correspondence, official notices and requests related to the
           contractor's performance under the contract shall be addressed. The
           contractor shall have the right to change or substitute the name of
           the individual described above as deemed necessary, provided that DMS
           is notified immediately.

3.4.1      The contractor shall fully coordinate its activities in the
           performance of the contract with those of DMS. As the work of the
           contractor progresses, advice and information on matters covered by
           the contract shall be made available by the contractor to DMS or the
           Division of Purchasing and Materials Management throughout the
           effective period of the contract.

3.5      TRANSFER OF MMIS:

3.5.1      The transfer of the current Missouri MMIS from the incumbent to the
           contractor's computer shall involve the performance of system
           testing, personnel training and related functions.

3.5.2      DMS will arrange for the transfer of a copy of the MMIS to the
           contractor, including source programs, test files, job cycle
           documentation, and all other supporting material necessary to operate
           the MMIS. The State will not bring up the system on its own
           computers. DMS will coordinate communications and participate in all
           meetings between the incumbent and the contractor, provide training
           time for DMS management and clerical personnel and notify providers
           of the pending change of contractor and of related procedural
           changes. The contractor shall occupy contractor-furnished facilities
           and establish a data processing system environment necessary to
           operate the MMIS.

3.5.3      DMS will advise the contractor of any changes to be made to the
           current MMIS by the incumbent prior to July 1, 2000, and subsequent
           to providing the current MMIS to the contractor. The contractor shall
           receive copies of all completed system modifications, including test
           data. The contractor shall receive and install software and test
           files from the incumbent. The software shall be modified by the
           contractor as necessary to accommodate equipment and operating system
           requirements. The contractor shall identify questions and problems
           relating to installation and testing of the MMIS for the DMS
           coordinator for presentation to the incumbent.

3.5.4      The contractor shall develop proposed operating procedures that shall
           be subject to DMS approval. Progress against the work plan shall be
           reported to DMS by weekly written reports and at weekly review
           meetings with DMS.

3.6      LOCATION AND STAFFING OF CONTRACTOR OPERATIONS:

           All contractor functions, with the exception of computer processing,
           must be performed at an office located within the Jefferson City,
           Missouri city limits or at a location approved by DMS. Some
           modifications and enhancement tasks may be performed by staff outside
           of the site requirements specified above with the prior approval of
           DMS.

3.6.1    DMS will not unreasonably disapprove the contractor's data center
         location.

3.6.2      The following staff shall be employed by the contractor, beginning on
           July 1, 2000, and throughout the life of the contract:

(1)               One (1) Account Manager shall be employed full-time at the
                  contractor's Jefferson City office. The Account Manager shall
                  be responsible for all aspects of Missouri Medicaid
                  operations.

(2)               One (1) Systems Manager shall be employed full-time at the
                  contractor's Jefferson City office. The Systems Manager shall
                  be responsible for system-related functions and development.

(3)               One (1) Claims Manager shall be employed full-time at the
                  contractor's Jefferson City office. The Claims Manager shall
                  be responsible for the identification, control and
                  processing of claims and related documents.

(4)               One (1) Support Services Manager shall be employed full-time
                  at the contractor's Jefferson City office. The Support
                  Services Manager shall be responsible for all non-system/claim
                  related functions.

(5)               One (1) Network Administrator shall be employed full-time at
                  the contractor's Jefferson City office. The Network
                  Administrator shall be responsible for all technical
                  operations and development including electronic claims, file
                  transmissions, Internet application development, LAN
                  administration, imaging and help desk maintenance. This
                  position will also be responsible for the duties of an
                  Automated Data Processing (ADP) security officer.

                  The Network Administrator shall have the minimum
                  qualifications of five (5) years professional, technical or
                  administrative electronic data processing experience of which
                  three (3) years must have been in a supervisory or
                  administrative capacity in computer systems analysis and
                  design, programming, computer operation or network operation;
                  and a college degree with specialization in computer science,
                  engineering, statistics, mathematics, accounting, public or
                  business administration or closely related areas. Graduate
                  work in the above areas may be substituted for the general
                  experience on a year-for-year basis. Additional experience may
                  be substituted for the required education on a year-for-year
                  basis.

(6)               Three (3) supervisors shall be employed full-time at the
                  contractor's Jefferson City office. These supervisors shall be
                  responsible for overseeing the tasks of the systems
                  programmers and the systems support staff. These staff shall
                  not be included in the staffing levels indicated in paragraphs
                  (7) or (8).

(7)               A minimum of twenty-five (25) programmers shall be employed
                  full-time at the contractor's Jefferson City office. These
                  programmers shall be responsible for the MMIS maintenance and
                  modification as specified under Modification paragraph (3.19.1
                  herein).

                  Three (3) of the programmers shall have minimum qualifications
                  of five (5) years of professional, technical or administrative
                  electronic data processing experience in computer systems
                  analysis and design, programming, computer operation or
                  network operation; and a college degree with specialization in
                  computer science, engineering, statistics, mathematics,
                  accounting, public or business administration or closely
                  related areas. Graduate work in the above areas may be
                  substituted for the general experience on a year-for-year
                  basis. Additional experience may be substituted for the
                  required education on a year-for-year basis;

                  Seven (7) of the programmers shall have minimum qualifications
                  of four (4) years of professional, technical or administrative
                  electronic data processing experience including substantial
                  experience in one of the following areas: EDP education and
                  training, data communications and teleprocessing, operating
                  systems and software, hardware evaluation and performance
                  measurement, job accounting and chargeback, privacy and
                  security, applications development, standards and procedures,
                  data base administration or computer operations management;
                  and a college degree with specialization in computer science,
                  engineering, statistics, mathematics, accounting, public or
                  business administration or closely related areas. Graduate
                  work in computer science or in a closely related field
                  involving course work using sophisticated computer
                  applications may be substituted on a year-for-year basis.
                  Additional qualifying experience may be substituted for
                  required education on a year-for-year basis;

                  Seven (7) of the programmers shall have minimum qualifications
                  of three (3) years of professional, technical or
                  administrative electronic data processing experience including
                  substantial experience in one of the following areas: EDP
                  education and training, data communications and
                  teleprocessing, operating systems and software, hardware
                  evaluation and performance measurement, job accounting and
                  chargeback, privacy and security, applications development,
                  standards and procedures, data base administration or computer
                  operations management; and a college degree with
                  specialization in computer science, engineering, statistics,
                  mathematics, accounting, public or business administration or
                  closely related areas. Graduate work in computer science or in
                  a closely related field involving course work using
                  sophisticated computer applications may be substituted on a
                  year-for-year basis. Additional qualifying experience may be
                  substituted for required education on a year-for-year basis;

                  Five (5) of the programmers shall have minimum qualifications
                  of two (2) years of professional and technical computer
                  information technology systems experience such as computer
                  programming, computer systems analysis and design, or work
                  with primary responsibility for the configuration of
                  mainframe, midrange and/or microcomputer hardware and
                  software, network administration or closely related areas; and
                  a college degree with at least fifteen (15) semester hours in
                  computer science, computer information systems or closely
                  related areas. Computer information technology systems
                  experience such as computer programming, systems analysis and
                  design or work with primary responsibility for the
                  configuration of computer hardware and software in a
                  mainframe, midrange and/or microcomputer environment may be
                  substituted on a year-for-year basis for deficiencies in the
                  stated education. Graduate work in computer science, computer
                  information systems or closely related areas may be
                  substituted on a year-for-year basis;

                  Three (3) of the programmers shall have minimum qualifications
                  of one (1) year of professional experience in computer
                  programming; and a college degree with specialization in
                  computer science, mathematics, statistics, accounting or
                  closely related areas. Graduate work in computer science or in
                  a closely related field involving substantial course work
                  using sophisticated computer applications may be substituted
                  for the experience on a year-for-year basis; OR two (2) years
                  of professional experience in computer programming and
                  successful completion of an Associates of Arts program with
                  specialization in computer science. Additional qualifying
                  experience may be substituted for the education on a
                  year-for-year basis.

                  These staffing qualifications are minimums and limited to the
                  on-going modification team. This requirement ensures adequate
                  skill sets. Additional staff qualifications required for
                  enhancements are at the contractor's discretion.

(8)               Five (5) Medicaid Information Analysts shall be employed
                  full-time at the contractor's Jefferson City office. The
                  Medicaid Information Analysts shall be responsible for,
                  among other things, researching claims processing problems
                  and SPARS brought to the attention of the Systems Manager by
                  DMS, providing reference file maintenance and providing
                  training to DMS staff.

                  Two (2) of the five (5) Medicaid Information Analysts shall be
                  devoted to the duties of a documentation specialist including
                  the use of FolioViews. The documentation specialists shall be
                  responsible for maintenance of the provider manuals, as well
                  as, developing, writing and maintenance of system
                  documentation manuals, including user manuals and the health
                  plan user manual.

                  The Medicaid Information Analysts shall have minimum
                  qualifications of one (1) year of professional or technical
                  experience in management analysis and improvement, computer
                  programming, computer systems analysis or design, accounting,
                  statistical work, or in office or program management work
                  which involved electronic data processing activities; and a
                  college degree with specialization in accounting, statistics,
                  mathematics, computer science, public or business
                  administration or closely related areas. One (1) year of
                  graduate work in the above areas may be substituted for the
                  year of required experience. Additional qualifying experience
                  may be substituted for the required education on a
                  year-for-year basis.

(9)               An adequately staffed Operations Unit shall be employed
                  full-time at the contractor's Jefferson City office. The
                  Operations Unit shall be responsible for all technical
                  operations and development including electronic claims, file
                  transmissions, Internet application development, LAN
                  administration, imaging and help desk maintenance. These staff
                  will report to the Network Administrator.

                  A minimum of four (4) staff will be solely devoted to the
                  duties of an EMC/Health Plan/MMIS help desk technician. The
                  following are the responsibilities of these technicians:

                  Front line assistance to providers in establishing the
                  required electronic claims format for processing as well as
                  assistance with communications and with DMS developed billing
                  software. Additionally, assistance shall be given in regard to
                  any acknowledgment reports or responses the provider receives
                  as a result of a claim file submission.

                  Front line assistance to health plans in establishing the
                  required electronic formats for submission and receipt of all
                  MC+ related data, establishing network communications and the
                  ongoing operation of that network. Additionally, assistance
                  shall be given in regards to any acknowledgment reports or
                  responses the health plan receives.

                  Front line assistance in answering DMS staff questions
                  regarding electronic claims submission, reporting LAN and PC
                  related problems, reporting 3270 problems including CICS
                  screen abends, and requesting reproduction of MMIS reports.

                  The EMC/Health Plan/MMIS help desk lines must be answered from
                  8:00 a.m. to 5:00 p.m., Monday through Friday, except for the
                  following holidays: New Years Day, Memorial Day, July 4, Labor
                  Day, Thanksgiving and Christmas. The contractor must make a
                  help desk number available for publication. This phone number
                  must be separate from the contractor's primary business line
                  and must be solely dedicated to the help desk. A message shall
                  be recorded for providers when the help desk is unavailable.
                  Callers shall be placed in a queue if all lines are busy,
                  allowing them the option to remain on hold for the next
                  available technician. A voice logger must be utilized on the
                  system for ongoing quality control and reporting as designated
                  by DMS.

                  An expected response time hierarchy will be provided after
                  contract award.

(10)                  An adequately staffed Claims Resolution Unit shall be
                      employed full-time at the contractor's Jefferson City
                      office. The Claims Resolution Unit shall be responsible
                      for resolving all claims suspended for exceptions. The
                      unit shall maintain a close working relationship with DMS
                      in developing new exceptions, writing the resolution
                      instructions for the unit and resolving claims in
                      accordance with program policy and procedures. As part of
                      this resolutions unit, a Medical Policy Unit shall be
                      established.

a.

                    The Medical Policy Unit shall be staffed with a minimum of
                    four (4) Registered Professional Nurses who have graduated
                    from an accredited four year college or university with a
                    Bachelor's degree in Nursing and who have had at least one
                    (1) year of professional nursing experience or who have
                    graduated from a recognized school of nursing and have had
                    at least two (2) years of professional nursing experience.
                    The experience of the four (4) nurses shall not be
                    representative of a singular discipline, but shall be broad
                    based. One (1) of these nurses shall be designated the unit
                    lead and shall supervise the other nurses. These nurses
                    shall not be paid based on the number of claims resolved (no
                    quotas). Their workload shall be assigned in a manner that
                    allows adequate time to properly review and resolve the
                    types of claims that DMS directs to the unit. The contractor
                    shall request DMS approval prior to assigning these nurses
                    any significant work outside the purview of the Medical
                    Policy Unit, even on a temporary basis. The Medical Policy
                    Unit shall resolve, at least, categories of claims as
                    directed by DMS and in accordance with DMS policy and
                    procedures. This unit shall be responsible for the pricing
                    of durable medical equipment and supply claims by utilizing
                    a commercial software product (such as EPIC) approved by
                    DMS.

                  b.  Additionally, as part of the Claims Resolution Unit, the
                      contractor shall maintain a permanent, part-time physician
                      consultant. This physician must be licensed to practice
                      medicine in Missouri and must be on site at the
                      contractor's location a minimum of ten (10) hours per
                      week. The primary function of this physician shall be to
                      resolve and price specific claims as directed by DMS and
                      to assist the other staff of the Claims Resolution Unit in
                      working more complicated claims as appropriate. The
                      contractor shall obtain DMS' approval of the physician
                      selected for this position prior to hiring such physician.

(11)                Two (2) programmer analysts shall be employed full-time at
                    the contractor's Jefferson City office. The programmer
                    analysts shall be responsible for responding to adhoc
                    requests initiated by DMS. Minimum qualifications for these
                    programmer analysts shall be two (2) years professional or
                    technical experience in management analysis and improvement,
                    computer programming, computer systems analysis or design,
                    accounting or statistical analysis or in office program
                    management work which involved electronic data processing
                    activities of which one (1) year must have included
                    experience in the analysis, design and preparation of
                    reports and/or procedures for adaptation to electronic data
                    processing operations and which included experience in
                    programming; and a college degree with specialization in
                    accounting, statistics, mathematics, computer science,
                    public or business administration or closely related areas.
                    One (1) year of graduate work in the above areas may be
                    substituted for the year of general work experience.
                    Additional qualifying experience may be substituted for the
                    required education on a year-for-year basis. In addition,
                    qualifications for these positions shall include a thorough
                    knowledge of SAS or whichever statistical language the
                    contractor elects to utilize for this responsibility. (SAS
                    is currently used for this purpose.) Only one adhoc
                    programmer analyst shall be housed full time at DMS. The
                    other programmer analyst must be housed in the contractor's
                    Jefferson City office. The contractor may choose to rotate
                    the programmer analysts between locations. Office space,
                    furniture, and telephone service will be provided by DMS for
                    the DMS location. Long distance calls must be limited to
                    only those specifically needed for the completion of an
                    adhoc request. No other long distance calls should be made.
                    DMS will provide one (1) port on its IBM 3274 controller for
                    the programmer analyst's terminal connection. The contractor
                    shall provide one (1) IBM 3270 compatible terminal for this
                    programmer analyst to use in the performance of his/her
                    programming duties.

(12)              An adequately staffed Recipient Services Unit (RSU) shall be
                  employed full-time at the contractor's Jefferson City office.
                  The RSU shall be responsible for responding to Medicaid
                  recipient inquiries. A further description of the duties of
                  the RSU Unit can be found in Paragraph 3.18.1 herein.

PARAGRAPH DELETED BY AMENDMENT #002:
(13)              Deleted.

(14)              An adequately staffed TPL Unit shall be employed full-time at
                  the contractor's Jefferson City office. The TPL Unit shall be
                  responsible for performing TPL verification on all leads
                  supplied by DMS or its designated agent. A further description
                  of the duties of the TPL Unit can be found in Paragraph 3.18.3
                  herein.

3.6.3     Provide four (4) furnished offices or cubicles, each with a minimum of
          one hundred (100) usable square feet, each equipped with a network PC,
          a telephone with local and long distance capability, a desk, a chair,
          a side chair, a bookshelf or credenza and related supplies, comparable
          to offices occupied by the contractor's personnel, at the contractor's
          facility for use exclusively by DMS or its designated agent. A current
          volume of the CPT procedural code book and the ICD-9-CM diagnosis code
          book, Volumes I and II, shall be provided by the contractor in this
          area. A conference room must be available by appointment. Photocopying
          must also be provided. Reasonable charges for work-related long
          distance calls and photocopies shall be absorbed by the contractor.

3.7      AUDIT AND ACCOUNTING REQUIREMENTS:

           The contractor shall ensure that the system facilitates auditing of
           individual claims and encounters. Adequate audit trails must be
           provided throughout the system. Where override codes are permitted,
           the use of such codes must be reported. Changes to prices, provider
           financial data and recipient eligibility must be highly controlled
           and appropriate audit trails and reports must be created.

           The contractor shall maintain books, records, documents and other
           evidence pertaining to the administrative costs and expenses of the
           contract to the extent and in such detail as shall properly reflect
           all revenues, all net costs, direct and apportioned, and other costs
           and expenses of whatever nature for which reimbursement is claimed
           under the provisions of the contract. The contractor's accounting
           procedures and practices shall conform to generally accepted
           accounting principles and the costs properly applicable to the
           contract shall be readily available.


<PAGE>



PARAGRAPH DELETED BY AMENDMENT # 002:
3.7.1    Deleted.

3.7.2      The contractor shall develop and submit to DMS a cost allocation plan
           in accordance with 45 CFR, Part 95, Subpart E. The contractor must be
           able to provide documentation to support wages, fringe benefits, and
           other expenditure items. Amendments to this plan must be submitted to
           DMS when changes occur.

3.7.3 The contractor shall agree to the following terms for access to records
relating to the contract:

(1)               All original claims and attachments that are a permanent part
                  of a claim (including consultant and Medical Policy Unit route
                  slips) adjudicated under the contract shall be retained by the
                  contractor for a minimum of forty-five (45) days from the date
                  of receipt as shown by the Julian date of the ICN.

(2)               Unless DMS specifies in writing a shorter period of time, the
                  contractor agrees to preserve and make available all other
                  pertinent books, documents, papers, and records of the
                  contractor involving transactions related to the contract for
                  a period of six (6) years from the date of expiration or
                  termination of the contract.

(3)               Records involving matters in litigation shall be kept for one
                  (1) year following the termination of litigation, including
                  all appeals, if the litigation has not terminated within the
                  six (6) years specified above.

(4)               The contractor shall agree that authorized federal and state
                  representatives shall have access to and the right to examine
                  the items listed above at the contractor's office at all
                  reasonable times during the six (6) year period specified
                  above.

3.8      PAYMENT:

           Payment for services and equipment provided under the terms of the
           resulting contract shall be made to the contractor in accordance with
           the firm, fixed prices stated in the contract for the applicable
           contract period. No payment shall be made by DMS for Planning,
           Transfer, Acceptance Testing and Implementation. Operation payments
           shall commence the month following contract implementation.

3.8.1      Monthly payments shall be made to the contractor for operation of the
           MMIS. The amount of such payment shall be equal to the firm, fixed
           total base price for all services and equipment required to operate
           the MMIS, as stated in the contract, divided by twelve (12).

PARAGRAPH REVISED BY AMENDMENT #002:
3.8.2      Additionally, DMS will provide the annual estimate of the number of
           claims and encounters to be processed. The contractor shall be paid a
           fixed price per increment of three hundred thousand (300,000) claims
           above the estimate. At the end of each contract period (annually),
           DMS and the contractor will reconcile the total number of claims and
           encounters processed during the contract period.

           If a credit is due DMS, the contractor shall reduce its next monthly
           invoice in accordance with the firm, fixed price to be credited, as
           stated in the contract, for the appropriate volume of claims and
           encounters.

           If additional payment is due the contractor, it shall be payable in
           the last quarter of the following state fiscal year. Such additional
           payment shall be made to the contractor in accordance with the firm,
           fixed additional price stated in the resulting contract for the
           appropriate volume of claims and encounters.

           For the purposes of counting claims and encounters, a claim or
           encounter shall be defined as a line item for all documents except
           inpatient, in which case the entire document shall be counted as one
           (1) claim or encounter. Only accepted encounters that receive an ICN
           may be included. Adjustments, financial transactions, capitation
           payments, and other non-claim transactions shall not be counted as
           claims.

3.8.3      Payment shall be made to the contractor for CPU time used in excess
           of four hundred twenty (420) hours per state fiscal year for DMS
           initiated adhoc requests in accordance with the firm, fixed price per
           CPU hour stated in the resulting contract. Only those adhoc requests
           that are DMS initiated will be counted toward the four-hundred twenty
           (420) CPU hours per year.

PARAGRAPH REVISED BY AMENDMENTS #002 AND #003:
3.8.4     All costs associated with telephone usage and postage are the
          responsibility of the contractor unless otherwise specified herein.
          The contractor shall be responsible for postage of mailing claim
          forms, incomplete claims, contractor-generated form letters, processed
          prior authorization (PA) requests and drug rebate invoices. The
          contractor shall also be responsible for postage for electronic media
          claims manuals and any software distributed to providers. Postage
          costs for mailing recipient RAs may be passed through to DMS. Every
          effort must be made by the contractor to secure the most cost
          effective postage and toll-free usage costs. The contractor will be
          reimbursed for actual expenses incurred for toll-free usage and
          postage for mailing recipient RAs.

3.9      INVOICING:

           The contractor shall submit itemized invoices as specified below to
           the Department of Social Services, Division of Medical Services, P.O.
           Box 6500, Jefferson City, MO 65102-6500.

3.9.1      The contractor shall submit invoices on a monthly basis for operation
           of the MMIS and for enhancement package operation.

3.9.2      The contractor shall submit invoices for implementation of the
           required enhancement packages upon completion. Ongoing costs, as a
           result of such enhancements, are billable the first day of the month
           following a full month of operations.

3.9.3      The contractor shall submit invoices for any other payment and/or
           reimbursement specifically provided for in the contract in the manner
           specified by DMS.

3.10     TECHNICAL SPECIFICATIONS AND COMPUTER RESOURCES:

           Various performance standards are identified below and elsewhere
           herein. If, either during or following implementation of any specific
           requirements of the system developed by the contractor, these
           performance standards are not met, DMS will have the right to take
           action in accordance with the procedures outlined in this document.

3.10.1    Data Processing: This section describes the general data processing
          specifications which the contractor must adhere to during the
          development and implementation of the Missouri MMIS. It is imperative
          that:

          o    Documentation is comprehensive

          o    Documentation, design, and program structure meet DMS standards
               as well as specifications included in this document

          o    The system is easily maintainable

          o    The system be error-free if turned over to DMS or its designated
               agent at the end of the contract

(1)               PROGRAMMING LANGUAGE: All MMIS application programs shall be
                  written in VS COBOL II or COBOL for MVS, with the exception of
                  sorts, generalized report writers and system support utilities
                  currently utilized by the State or provided and maintained by
                  the State's computer hardware vendor, and data base access
                  routines.

a.                Exits from COBOL programs to standard I/O routines are
                  acceptable. Job control language, telecommunication monitors
                  and software used to support adhoc reporting are also excluded
                  from the COBOL requirements since they are not applications
                  programs.

(2)               SOFTWARE: The contractor shall be responsible for obtaining
                  all licensed software, teleprocessing monitors, utilities,
                  sorts, database management systems, or other licensed software
                  products required to operate the Missouri MMIS. No proprietary
                  software may be added to the system for any applications
                  program activity. A listing of current hardware and software
                  is presented as Attachment F.

(3)               HARDWARE: The Missouri MMIS must be operated on IBM or IBM
                  plug-compatible hardware. The contractor shall be responsible
                  for obtaining at its expense all hardware required to
                  successfully operate the Missouri MMIS and to carry out all
                  tasks specified in the contract.

3.10.2     Confidentiality: The MMIS must be designed to be highly reliable and
           secure and to recognize the confidential nature of much of the data
           maintained by the system. The following subsections provide
           additional details of these and other related requirements:

3.10.2.1   The contractor shall treat all information, and in particular,
           information relating to recipients and providers, which is obtained
           by the contractor through its performance under the contract, as
           confidential information to the extent that confidential treatment is
           provided under state and federal law. The contractor shall not use
           any information so obtained in any manner except as necessary for the
           proper discharge of its obligations and protection of its rights
           hereunder.

(1)               Confidentiality of client and provider information: All
                  information as to personal facts and circumstances obtained by
                  the contractor shall be treated as privileged communications,
                  shall be held confidential, and shall not be divulged without
                  the written consent of DMS and the written consent of the
                  enrolled recipient, his/her attorney, and/or his/her
                  responsible parent or guardian, except as may be required by
                  DMS; provided that nothing herein shall prohibit the
                  disclosure of information in summary, statistical or other
                  form, which does not identify particular individuals. The use
                  of disclosure information concerning recipients will be
                  limited to purposes directly connected with the administration
                  of the contract. No employee of the contractor shall be
                  employed or conduct business in a manner which would be
                  considered a conflict of interest or construed as misuse of
                  confidential information. Working for a billing agency or
                  Medicaid billing office would be examples of inappropriate
                  employment.

3.10.3     Security: The contractor shall develop and implement an ADP Security
           Program after contract award but within three months of contract
           implementation. The ADP Security Program must be received and
           approved by DMS prior to implementation.

3.10.3.1 The ADP Security Program shall include the following components:

(1) Establishment of a security plan, policies and procedures to address:

a. Physical security of ADP resources;


<PAGE>


                  b. Equipment security to protect equipment from theft and
                  unauthorized use; c. Software and data security; d.
                  Telecommunications security; e. Personnel security; f.
                  Contingency plans to meet critical processing needs in the
                  event of short or long term
                      interruption of service;
                  g.  Emergency preparedness.

(2)      Designation of an ADP Security Manager (may be included in the duties
         of the Network Administrator).

(3)               Performance of periodic risk analyses to ensure that
                  appropriate, cost-effective safeguards are incorporated into
                  new and existing systems. A risk analysis must be performed
                  whenever significant system changes occur.

3.10.3.2   The ADP Security Program must be reviewed and revised as necessary to
           conform to any future federal regulations addressing system and
           operational security under HIPAA.

3.10.3.3   Contractors shall certify, on an annual basis, continued compliance,
           review and update of the ADP Security Program.

3.10.3.4   The contractor shall log all CICS transactions by user identification
           and retain through the end of the contract.

3.10.4     MMIS Certification: The contractor shall ensure that federal MMIS
           certification is continued throughout the period of operation. In the
           event the HHS determines that a new certification process is
           necessary, the contractor shall ensure that all such certification
           requirements are met and that the new certification be retroactive to
           the date on which certification was discontinued, should such
           discontinuation occur.

           The contractor shall pay actual damages equal to the difference
           between the maximum allowable federal financial participation and
           that amount actually received by DMS because of failure on the part
           of the contractor to maintain certification.

3.10.5     System Interfaces: The file transfer software package currently used
           is Connect:Direct (formerly NDM). If Connect:Direct is not used by
           the contractor, a comparable file transfer software must be used. The
           contractor shall be required to support Connect:Direct in addition to
           the file transfer software the contractor chooses to use. The
           following is a list of required system interfaces maintained by or
           with the contractor:

o        SDC
o        DSS/DDP
o        MC+ Health Plans
o        TPL Revenue Maximization Contractor
o        NEIC
o        HCFA
o        MEDSTAT (Decision Support System)
o        Medical Review Services (MRS)
o        ARU eligibility verification systems
o        POS network vendors
o        EMC billers
o        PharMark

3.10.6     Computer Resources: The contractor shall be responsible for providing
           computer resources throughout the eight (8) tasks. No State computer
           resources will be available to the contractor, except those necessary
           to provide eligibility data, those necessary to test system
           interfaces during acceptance test, and those necessary to support the
           SNA Network Interconnection interface.

3.10.6.1   The contractor shall provide DMS with on-line inquiry and/or update
           access to certain files. DMS reserves the right to add additional
           users at its discretion. The contractor shall utilize the IBM, SNA
           software to connect the SDC with the contractor's mainframe. The
           contractor shall run a back-to-back configuration between the SDC and
           the contractor's data center.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.10.6.2   The contractor shall make the necessary changes to all appropriate
           communication software on the contractor's system to allow DMS
           terminal access and any other access required. The State will be
           responsible for all software changes in the SDC. DMS will be
           responsible for providing and installing terminals to be used by DMS
           at its facilities. The contractor shall install modems and all
           necessary telecommunications lines between the SDC and the
           contractor's data centers. The contractor must have available and
           utilize Alias Name Translation Facility to resolve any naming
           conflicts.

3.10.6.3   Additionally, the contractor shall provide for use by DMS four (4)
           terminals with access to the contractor's data center to be located
           in the DMS consultant area at the contractor's office.

3.10.6.4   The contractor shall maintain a terminal response time of two (2)
           seconds or less at least ninety (90) percent of the time on all CICS
           applications. The contractor shall provide DMS with a monthly report
           indicating the response time figures for the preceding month.

3.10.6.5   The contractor shall maintain a response time of five (5) seconds or
           less from the contractor's data center back to the telecommunications
           network vendor per claim submitted on-line through POS. The
           contractor shall provide DMS with a monthly report indicating the
           response time figures for the preceding month.

3.10.6.6   The contractor shall establish agreements with telecommunications
           network vendors to install data lines to the contractor's data center
           for the purpose of transmitting eligibility verification and claim
           transactions. All agreements established between the contractor and
           any telecommunications network vendors must receive prior DMS
           approval. These agreements shall specify at least the following:

(1)               The contractor shall bill Medicaid providers directly for
                  those costs associated with the hardware installed in the
                  provider's location and for reasonable transaction fees. The
                  vendor must also provide start-up and ongoing support to both
                  the contractor and the Medicaid providers.

PARAGRAPH REVISED BY AMENDMENT # 002:
(2)               The contractor shall make dial-up or leased lines available to
                  Medicaid providers twenty-four (24) hours a day, seven (7)
                  days per week. Such lines shall be monitored twenty-four (24)
                  hours a day for technical problems and for any bottleneck
                  effects of incoming traffic.

(3)               The contractor must keep any information passing through its
                  network confidential and must only use such information in its
                  function as a telecommunications network vendor.

3.10.6.7   The contractor may charge the telecommunications network vendors a
           reasonable flat monthly fee for the data line connection to the
           contractor's data center. However, the contractor shall not in any
           manner base this fee upon transaction volume.


<PAGE>



3.10.6.8   The contractor and the above-referenced vendors must adhere to all
           relevant federal and state confidentiality/privacy laws, regulations
           and contractual provisions throughout the effective period of the
           contract.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.10.7     The contractor shall provide twenty (20) copies of Lotus Notes or a
           comparable software package to DMS. Lotus Notes currently contains
           applications developed for DMS to initiate and track such things as
           STRs, SPARs, adhocs, explanation of benefit (EOB) and text file
           updates and provider information. Lotus Notes also provides the
           primary electronic mail source between DMS and the contractor. If a
           new software package is proposed in lieu of Lotus Notes, all
           applications currently available through Lotus Notes must be
           converted to the new software and all historical information stored
           in Lotus Notes databases must be accessible to DMS staff.

3.10.8     The contractor shall maintain user manuals and other reference files
           in an electronic format through FolioViews or a comparable software
           package. FolioViews shall be for access and maintenance of system
           documentation manuals, provider manuals, exceptions, explanation of
           benefits and system parameters. The contractor shall be required to
           update the files stored in FolioViews on a monthly basis.

3.11     CLAIMS CONTROL AND IDENTIFICATION:

           The contractor shall operate the Claims Processing Subsystem of the
           Missouri MMIS, including enhancements as they are implemented. The
           contractor shall maintain a facility to receive and control Medicaid
           claims and encounters on a daily basis.

3.11.1     Mailroom: The contractor shall mail all claims, claim attachments,
           and provider labels to providers within five (5) working days of
           receipt of the request. Providers shall not be charged for claims,
           labels, or postage costs.

           DMS will perform a minimum of two (2) random, unannounced mailroom
           inspections per year to determine the number of claims not keyed in
           the system in accordance with the consent decree of Grant vs. Reagan.

3.11.1.1   Post Office Boxes: The contractor shall provide post office boxes to
           be used by providers and other entities for claim submission, by
           recipients for written inquiries and others as indicated by DMS.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.11.1.2   Document Control: The contractor shall screen all claim form fields
           specified by DMS as required fields. Paper claims missing certain key
           data elements will be returned to the provider prior to data entry.
           Required data elements can be found in the Document Control Manual of
           the system documentation.

3.11.1.3   Scanning (Imaging): The contractor shall assign all paper claims an
           ICN no later than one (1) workday following the actual date of
           receipt and PAs must be assigned an ICN no later than two (2)
           workdays following the actual date of receipt.

           The contractor shall maintain a system by which all incoming
           documents are stored as computer images on the contractor's computer.
           These documents must be retrievable by DMS staff as set forth below
           and must be accessible in a variety of ways (ICN, DCN, provider
           number, date range, etc.). DMS must be able to print these documents
           as needed.

(1)               The images displayed must be full document images that look
                  the same as the original piece of paper that was scanned. The
                  contractor may design a system that uses dropout methods, if
                  so desired. The color of the imaged forms may also be changed.


<PAGE>



(2)               DMS staff must be able to retrieve and display in ten (10)
                  seconds or less the first page of an imaged document that is
                  mounted in an optical drive in read/write mode. Each
                  subsequent page of the same document must be displayed in one
                  (1) second or less.

(3)               Any other document that has been imaged must reside on an
                  optical disk inside the jukebox and must be able to be
                  retrieved in thirty (30) seconds or less.

(4)               The system must have the functionality to add newly scanned
                  documents to existing images.

(5)               The contractor shall allow for unlimited batch imaging
                  retrieval requests. Image requests that have been batched
                  should print in the evening after regular business hours at
                  either DMS or the contractor's facility, whichever is
                  indicated by the requestor.

(6)               The contractor shall maintain all images for the duration of
                  the contract. Upon termination of the contract, or other date
                  specified by DMS, the contractor shall turn over to DMS, or
                  its designated agent, optical disks or other storage media
                  used to fulfill the imaging requirements.

3.11.2     Exam Entry: The contractor shall perform exam entry functions in
           batch or on-line mode, perform appropriate pre-screening functions
           prior to entry of claims data into the system and maintain ongoing
           quality control programs to oversee all exam entry functions.

           The contractor shall implement and operate procedures to identify
           claims suspended as a result of exam entry errors and correct such
           errors.

3.11.3     Electronic Media Claims (EMC): An electronic claim is defined as a
           claim or encounter submitted by utilization of any electronic media,
           hereinafter referred to as EMC. The contractor shall accept all EMC
           claims and encounters by methods approved by DMS. EMC claims and
           encounters received by 5:00 p.m. must be entered in that night's
           cycle. EMC claims and encounters received after 5:00 p.m. must be
           entered in the cycle the evening of the following business day. Refer
           to Attachment A for claim and encounter statistics.

(1)       Point Of Service (POS) - The contractor shall operate the existing POS
          System for claim submission and on-line adjudication. The system is
          currently only for drug claims. The contractor shall accept and
          process claim transactions from public or private communications
          networks using the NCPDP record layout specifications. The contractor
          must support NCPDP versions 3.2, 3.C and 5.0, when released. The
          contractor shall provide capability to monitor bottleneck effect of
          incoming transactions from the networks. POS claim submission must be
          available twenty-four (24) hours a day, seven (7) days per week except
          for DMS approved scheduled maintenance.

(2)               Direct Electronic Medicaid Information (DEMI) - The contractor
                  shall accept and process claim and encounter transactions from
                  service providers for all claim types submitted directly to
                  the contractor's data center. Access to the contractor's data
                  center must be direct dial-up or a direct dedicated line.
                  Asynchronous and bisynchronous modems must be available for
                  the dial-up system. CPU-to-CPU data transfer must allow for
                  immediate editing of the records with an electronic
                  transmission confirmation report available to the service
                  provider.

PARAGRAPH REVISED BY AMENDMENT # 003:
(3)               Direct Electronic File Transfer (DEFT) - The contractor shall
                  accept and process claim transactions from service providers
                  for all claim types submitted directly to the contractor using
                  a Bulletin Board System (BBS) or on a diskette.

(4)               Magnetic Tape Billing (MTB) and Diskette - The contractor
                  shall accept and process claim transactions from service
                  providers for all claim types submitted directly to the
                  contractor on magnetic tape or diskette.

(5)               Fast Electronic Nursing Institution Transmit(x)(FENIX) - The
                  contractor shall accept and process nursing institution claims
                  submitted directly to the contractor using the proprietary
                  FENIX software. The contractor shall also accept paper
                  submissions of claims from providers printed from the FENIX
                  software.

PARAGRAPH ADDED BY AMENDMENT # 003:
(6)               Accelerated Submission And Processing (ASAP) - The contractor
                  shall accept and process claims submitted in the ASAP record
                  formats. ASAP claims may be submitted via the bulletin board
                  or diskette.

PARAGRAPH ADDED BY AMENDMENT # 003:
3.11.3.1   BBS Requirements - The contractor shall establish and maintain an
           electronic bulletin board (BBS) for the purpose of receiving certain
           electronic claims from providers. This BBS shall contain a minimum of
           eight (8) modems rated at a minimum of 56kb per second. The
           communication lines on this BBS shall be toll-free.

3.12     DATA VALIDITY:

3.12.1     The contractor shall process all claims, encounters, adjustments and
           other related transactions against the most current files according
           to the procedures, policies and mandates developed and approved by
           DMS.

3.12.1.1   The contractor shall maintain a file of exceptions and system
           parameters that claims, encounters, adjustments and other related
           transactions must be processed against.

(1)               The exception control file shall be maintained in such a
                  manner to provide the ability to apply an exception by
                  individual claim type and media.

3.12.1.2   The contractor shall process encounters applying to multi-level
           editing that includes "up-front" data validity editing. Encounters
           must be rejected before entering the system if one of these errors is
           present. These errors are listed in the Health Plan User Manual that
           can be found in the procurement documentation library.

3.12.2     The contractor shall apply a series of exceptions to all electronic
           files transmitted by the MC+ health plans. The file layouts and
           exceptions can be found in the Health Plan User Manual.

3.12.3     The contractor shall provide the capability for on-line generated
           return to provider (RTP) letters for post exam entry errors. A file
           of RTP letters accessible by provider number must be available
           on-line to DMS staff. Approximately ten (10) percent of all claims
           returned to providers are returned during the resolution function.
           RTP letters are currently created in WordPerfect and saved to the
           image file as a permanent part of the claim image.

3.13     RECIPIENT ELIGIBILITY:

3.13.1     The State will determine which persons are eligible to receive
           benefits under the Missouri Medicaid program and provide daily
           updates via a file transfer software package to include all changes
           generated by the State affecting the recipient files.

3.13.2     The contractor shall receive daily recipient file update
           transmissions from DDP and operate the recipient subsystem of the
           Missouri MMIS. The contractor shall update all relevant recipient
           files including eligibility and lock-in with all accepted State
           generated recipient transactions upon the date of receipt of such
           transactions.

PARAGRAPH REVISED BY AMENDMENT #002:
3.13.3     The contractor shall accept transaction requests for plastic Medicaid
           identification cards from DDP and is responsible for creation and
           distribution of the cards. A subcontractor may be utilized for the
           creation and distribution of these cards with the prior approval of
           DMS. These cards shall be mailed within forty-eight (48) hours of
           receipt of transaction request. The contractor will be reimbursed for
           actual expenses incurred for ID cards and postage.

3.13.4     The State will interpret eligibility and related policy and make
           administrative decisions. DMS will establish guidelines regarding
           which recipient inquiries should be handled by the contractor and
           which should be referred to DMS.

3.13.5     The contractor shall print and mail targeted Recipient Explanation of
           Medicaid Benefits (REOMBs) as requested by DMS.

3.13.6     The contractor shall provide on-line inquiry access to the MMIS
           recipient eligibility file utilizing CICS as the teleprocessing
           monitor. Inquiry access must be available by 1) DCN, 2) social
           security number, 3) TEMP number, and 4) first and last name, date of
           birth and sex code.

3.13.7     The contractor shall purge the recipient eligibility file based on
           DMS criteria and provide to DMS one (1) copy of microfiche of purged
           records within thirty (30) days of the date of purge. The microfiche
           must be clear, legible, and free of physical defects. Backup tape
           files of the recipient master files must be produced weekly. Such
           files shall be maintained for the duration of the contract and shall
           then be turned over to DMS or its designated agent.

3.13.8     The contractor shall maintain the recipient master file to include
           data for a period of at least thirty-six (36) months after a
           recipient's eligibility is terminated. This includes all base,
           eligibility and cross-reference records. The contractor shall perform
           systematic inactivations of the recipient file on a yearly basis. The
           timing of each inactivation shall be coordinated with DMS.

3.13.9     The contractor shall perform a reconciliation of all State recipient
           eligibility information, including TPL data, with MMIS recipient data
           as requested by DMS.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.13.10    The contractor shall create, print and mail recipient notices.
           One-third of these recipient notices shall be produced and mailed by
           the contractor on a monthly schedule. The contractor shall be
           responsible for all costs (excluding postage) related to this
           responsibility. The notices shall include all services paid or denied
           on behalf of the recipient (with the exception of those services
           designated as confidential) during the previous quarter and shall be
           produced in a format specified by DMS. Notices shall be prepared and
           sorted in a manner that allows for the use of the lowest applicable
           first class postage rates. All cost savings features such as address
           correction and zip code + 4 must be done in accordance with USPS
           rules and regulations. The notices must be printed on a laser printer
           and mailed in security envelopes to ensure confidentiality of the
           information contained in the notices. The contractor shall only
           invoice DMS for actual postage costs incurred which shall be payable
           in the month following each monthly mailing.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.13.11    The contractor shall operate the existing recipient eligibility
           inquiry system (ARU). The current system requires the contractor to
           provide eighty (80) dial-in ports for eligibility, claim status,
           check/RA amount, procedure code inquiry and miscellaneous
           informational recordings. The contractor shall provide a toll-free
           number, accessible to in-state and out-of-state callers, with the
           cost of the toll-free lines being passed through to DMS. The system
           must be available twenty-four (24) hours a day, seven (7) days per
           week with the exception of scheduled maintenance.

3.13.12    The contractor shall operate the existing POS eligibility
           verification system. This requires the contractor to establish
           agreements with network vendors to install dedicated telephone lines
           to the contractor's data center. The dedicated telephone lines must
           be available to Medicaid providers twenty-four (24) hours a day,
           seven (7) days per week with the exception of scheduled maintenance.
           All transaction costs will be the responsibility of the provider.

3.13.13    The contractor shall collect daily MC+ health plan PCP assignment
           update transactions submitted electronically by each health plan
           using a file transfer software package. The contractor shall maintain
           the lock-in master file to include all of a recipient's lock-in data.

3.13.14    The contractor shall receive, update and transmit recipient telephone
           number changes and baseline health status data from the enrollment
           broker through DDP.

3.13.15    The contractor shall maintain the hospice master file to include all
           of a recipient's hospice data. Some hospice data is transmitted from
           DDP. However, the majority of the data is updated on-line by DMS.

3.14     PROVIDER ENROLLMENT:

3.14.1     DMS will determine the enrollment status of all providers. The
           contractor shall operate the provider subsystem of the Missouri MMIS.

3.14.2     DMS will be responsible for all provider file updates using on-line
           terminals. The contractor shall maintain the provider master file
           with all DMS and contractor generated provider transactions.
           Contractor updates shall be limited to the special mailing address
           for claim and label orders, RA tape indicator, clerk ID number and
           EMC indicator. Direct deposit updates originate from DMS and must be
           sent to the contractor using file transfer software and applied to
           the provider file.

3.14.3     DMS will assign a nine-digit provider number containing a five-digit
           sequential base number supplied by the contractor. DMS will notify
           providers of their ID numbers and effective date of enrollment.

3.14.4     DMS will determine policy and make all administrative decisions
           concerning provider enrollment, payments and related issues. The
           contractor shall maintain the provider master file to include data
           for a period of at least thirty-six (36) months after a provider's
           enrollment is terminated. The contractor shall perform systematic
           inactivations and purges of the provider file upon the request of
           DMS. The contractor shall generate reports in alpha order of those
           files to be inactivated or purged.

3.14.5     The contractor shall provide DMS with on-line inquiry and update
           access to the provider master file. Inquiry access must be available
           by 1) provider number, 2) provider name, and 3) provider type,
           specialty and county code. The provider master file shall be placed
           on microfiche and provided to DMS. The microfiche must be clear,
           legible, and free of physical defects. The provider master files must
           be backed up weekly. These files shall be maintained for the duration
           of the contract and turned over to DMS or its designated agent.

3.14.6     The contractor shall provide DMS with on-line inquiry access to the
           CLIA master file directly from the provider master file. The
           contractor shall update and maintain the CLIA master file. Updates to
           the file are supplied on a weekly basis by HCFA using a combination
           of dial-up modem and file transfer software.

3.14.7     DMS will establish and maintain effective and timely provider
           relations and provider education to ensure program continuity and
           integrity at all times. The contractor shall be required to assist in
           education and training as requested by DMS.

3.14.8     The contractor shall provide claims in quantities specified by the
           provider and/or DMS with pre-printed information for providers
           containing name, address and provider number (composed of first two
           initials of provider name and nine-digit number). The contractor
           shall mail all claims and forms to providers within five (5) days of
           receipt of request. Pre-printed claims shall be produced at the time
           of enrollment or change in the provider's name, address or number, or
           upon provider or DMS request. In lieu of pre-printed claims, the
           provider shall have the option of requesting self-adhesive labels
           with the previously specified information pre-printed at no charge to
           the provider.

3.14.9     The contractor shall maintain a computer imaging database for
           provider enrollment files that are scanned by DMS staff. DMS must be
           able to print these documents as needed. Print selection options must
           be available to DMS staff. Workstation monitors must display images
           at a resolution of at least three hundred (300) dots per inch.

3.14.9.1   The images displayed on workstations must be full document images
           that look the same as the original piece of paper that was scanned.
           The contractor may design a system that uses dropout forms or other
           storage savings methods, if so desired. The color of the imaged forms
           may also be changed.

3.14.9.2   DMS staff must be able to retrieve and display in ten (10) seconds or
           less the first page of an imaged document from an optical disk that
           is mounted in an optical drive in read/write mode. Each subsequent
           page of the same document must be displayed in one (1) second or
           less.

3.14.9.3   Any other document that has been imaged must reside on an optical
           disk inside the jukebox and must be retrieved within thirty (30)
           seconds or less.

3.14.9.4   On an on-going basis, DMS must be able to add document images to this
           database as new providers are enrolled or as changes are made to
           existing provider enrollment files. The contractor must provide an
           acceptable method of accomplishing this requirement through the
           provision of scanning equipment located at DMS.

3.14.9.5   The contractor shall maintain all images for the duration of the
           contract. Upon termination of the contract or other date specified by
           DMS, the contractor shall turn over to DMS, or its designated agent,
           all optical disks or other storage media used to fulfill the imaging
           requirements.

3.14.10    The contractor shall maintain a provider enrollment master file for
           data entry purposes. All new enrollment and status changes will be
           entered into this file by DMS. The MMIS provider master file shall be
           updated nightly by the contractor and have the ability to hold
           certain records in a pending status.

3.14.10.1  The contractor shall assign a provider number while the application
           is in pending status. The MMIS must not indicate a provider as
           "active" until it has been posted as such by DMS.

3.14.10.2  The contractor shall maintain on-line data entry verification for
           key fields.

3.14.10.3  The contractor shall automate generation of approval letters, labels
           and claim forms when an application has been approved.

3.14.10.4  The contractor shall create a logging system to be used by the DMS
           Provider Enrollment Unit. The system shall combine the current
           provider application return and update logging process into one
           logging system utilizing the Lotus Notes application or a comparable
           software package.

3.14.11    The contractor shall collect daily MC+ health plan provider
           demographic update transactions submitted electronically by each
           health plan using a file transfer software package. The contractor
           shall maintain the provider demographic file to include all of a
           provider's data. The contractor shall provide the ability to navigate
           between the provider demographic file and the provider master file
           using "hot key" functions.

3.15     EDITING AND PRIOR AUTHORIZATION:

3.15.1     The contractor shall process all claims, encounters and other
           claims-related transactions in accordance with program policy,
           benefits, and limitations as defined and established by DMS.

3.15.2     The contractor shall maintain a thirty-six (36) month adjudicated
           claims and encounters history file of all transactions processed to
           final disposition including capitation payments, financial
           transactions, reinsurance, kick payments, credits and adjustments.
           The contractor shall also maintain certain procedure codes for life
           and others for a specific time retention period as specified by DMS.

3.15.3     Tape files for all claims adjudicated by the MMIS since August 1,
           1979, shall be retained and made available to DMS on request.

3.15.4     The contractor shall provide DMS with on-line inquiry access to the
           most recent thirty-six (36) months of complete claims and encounter
           history. Inquiry access must be available by 1) adjudicated claims,
           2) pseudo adjudicated claims, 3) suspended claims including reason
           for suspense, 4) claims and encounter history, 5) provider summary,
           6) month-to-date adjudicated claims and 7) encounter claims history.

3.15.5     The contractor shall also provide inquiry access to the following
           files: provider master, recipient master, drug file, procedure code,
           diagnosis code, revenue code, medical criteria, institutional
           criteria, system parameter, exception code and on-line security. The
           contractor shall provide the ability to easily navigate between
           on-line files using "hot key" functions on CICS.

3.15.6     The contractor shall provide on-line inquiry and update access to the
           PA file. Inquiry access must be available by 1) DCN, 2) PA number, 3)
           DCN and program code, and 4) DCN and provider type.

3.15.7     The contractor shall process and maintain PA requests within the PA
           system. The contractor shall provide on-line inquiry and update
           access to the PA file. Inquiry access must be available by 1) DCN, 2)
           PA number, 3) DCN and program code and 4) DCN and provider type.

3.15.8   The  contractor  shall image,  number and data enter requests into the
         PA file within two (2) working days of receipt.

3.15.9     The contractor shall gather all claims history and related materials
           and route to DMS consultants and/or designated individuals or
           agencies.

3.15.10    Approved or denied PA requests must be updated by the contractor and
           returned to the provider within two (2) working days of approval or
           denial date.

3.15.11    PA requests for recipients participating in MC+ are systematically
           denied. RTP letters and recipient notices are generated by the
           system.

3.15.12    The contractor shall prepare and mail recipient PA denial notices
           within five (5) working days of denial. The format of the notice will
           be determined by DMS.

3.15.13    The contractor shall provide the capability to process PA request
           files received electronically from the Division of Aging (DA) using a
           file transfer software and post these requests to the PA file. The
           contractor shall establish a separate grouping of numbers for DA to
           use with their request.

3.15.14    The contractor shall ensure that the PA file has unlimited capacity
           for PA requests per recipient. The contractor shall purge closed PA
           files monthly using criteria specified by DMS.

3.15.15    The contractor shall maintain rates on the MC+ capitation rate file
           and create capitation-withholding records utilizing CICS screens. The
           contractor shall provide DMS with the capability to enter capitation
           rates on-line in the capitation rate table file.

3.15.16    DMS will furnish and maintain staff to process individual provider
           adjustments. Adjustment staff will examine adjustments received from
           providers and return those which cannot be processed. The remaining
           adjustments will be batched and sent to the contractor for imaging.
           The adjustment staff will exam enter the adjustments and perform any
           related suspended claims resolution.

3.15.17    The contractor shall maintain a method to track, validate and process
           for payment any specific claims as directed by DMS on an exception
           basis. Each claim shall be submitted along with a letter providing
           instructions for special processing. Generally, these claims require
           forcing of exceptions by the claims resolution unit.

3.15.18    The contractor shall suspend for review as directed by DMS those
           claims containing specific providers, procedure codes, provider
           types, or exceptions placed on prepayment review by DMS. The
           contractor shall be responsible for mailing all off-site consultant
           claims.

3.15.19    The contractor shall suspend, approve to pay, or deny claims using
           the current system of exceptions and system parameters. Related
           history for those claims failing history related exceptions must be
           available on-line through a function key when accessing claim
           details.

3.15.20    The contractor shall maintain the capability for DMS to enter free
           flow text on-line and print to the provider RA.

3.15.21    DMS will update and maintain all procedure, drug, diagnosis and
           revenue codes using CICS. DMS will request updates to the
           institutional criteria, medical criteria and system parameter files
           and the contractor shall update and maintain these files.

3.15.22    The contractor shall calculate payment of Hospital Part A crossover
           claims to pay the lesser of the actual crossover amount as determined
           by Medicare or the amount the Medicaid fee exceeds the Medicare
           payment.

3.15.23  DMS will provide Pharmaceutical Consultant and staff to:

(1) Authorize updates to the drug reference file, (2) Develop policy for
pharmaceutical coverage and reimbursement, and (3) Administer the drug PA
process.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.15.24    The contractor shall contract for drug file updating services subject
           to DMS approval and update drug file data supplied by the drug file
           supplier. The contractor shall ensure that the drug file contractor
           utilizes the most current versions of Drug-To-Drug Interaction
           Modules. DMS will also perform manual updates to the drug file. The
           cost of the annual license fees for these files may be passed through
           to the State.

3.15.25    The contractor shall provide access to on-line claims and prior
           authorization files to DMS consultants from a remote site.

3.16     ADJUDICATION:

3.16.1     The contractor shall perform nightly adjudication on electronic
           claims and encounters received by the contractor before 5:00 p.m.
           Claims and encounters received electronically will be processed
           nightly through data validity, recipient, provider, pricing and
           history exceptions. The disposition of the claim or encounter will be
           determined along with the reimbursement amount. The following day,
           providers must be able to check the status of their submitted claims
           and encounters through the ARU or POS.

3.16.2     DMS will determine the timing for the financial cycle, cut off for
           data entry into a cycle, and the delivery of the RA and payment tapes
           to the State. The contractor shall comply with these timing
           determinations.

3.16.3     The State will print and mail provider checks, provider earning
           statements, remittance advices and other provider related materials
           produced by the contractor's system. The schedule of payments to all
           providers shall be semi-monthly. The contractor shall supply
           providers and processors with electronic remittance advices.

3.16.4     The contractor shall research and prepare mass adjustments, mass
           recycles, mass credits and also adjustments that are contractor
           caused. Adjustments which fail exceptions as the result of a mass
           adjustment, mass recycle or mass credit shall be worked by the
           contractor. DMS will have final approval on all mass adjustments,
           mass recycles and mass credits before being released for processing.

3.17     DATA COLLECTION, TRANSFER AND REPORTING:

           The contractor shall produce and provide the files, reports and other
           data to DMS, or its designated agent, by the required frequency and
           media specified by DMS. This includes any and all files, reports and
           data generated by any of the subsystems within the MMIS. The reports
           listed in the following sections are not an all-inclusive list of
           reports.

3.17.1     The contractor shall produce and transmit to DDP on or about the 15th
           day of each month, a file containing the most current version of the
           master provider file (MMICMMO.BMVS1020) and the capitation tape
           (MMICMMO.BMDS7180).

3.17.2     The contractor shall produce and deliver to DMS, or its designated
           agent, on a monthly basis current listings of all providers on file
           for any county, by provider type.

3.17.3     The contractor shall produce and deliver to DMS, or its designated
           agent, a CLIA master file update report on a weekly basis with all
           HCFA generated updates. Maintain DMS generated updates on CICS log
           file.

3.17.4     The contractor shall produce and deliver to DMS, or its designated
           agent, a recipient subsystem maintenance report within twenty-four
           (24) hours after the receipt of maintenance transactions from DDP.
           These reports include, but are not limited to, the Recipient Update
           Error Report, Lock-in Delete Report and Carrier File Update Report.

3.17.5     The contractor shall produce and transmit daily enrollments,
           disenrollments, ME code change records, address, name changes, date
           of birth and PCP update notification records to each MC+ health plan.
           Also, PCP update notification records are transmitted to the
           enrollment broker through DDP.

3.17.6     The contractor shall produce and transmit to each MC+ health plan and
           the enrollment broker a weekly reconciliation file of recipients
           currently locked into each plan.

3.17.7     The contractor shall produce and transmit to each MC+ health plan TPL
           information for recipients currently locked into each plan.

3.17.8     The contractor shall produce confirmation reports after each
           recipient notice mailing with information on the number of notices
           mailed in total, number of notices mailed by page number and number
           of notices qualifying for postage discounts.

3.17.9     The contractor shall produce and deliver to DMS one (1) microfiche
           copy of all recipient notices within three (3) days of each mailing.
           The microfiche must be clear, legible, and free of physical defects.

3.17.10    The contractor shall produce and transmit to DMS, or its designated
           agent, a file containing the most current version of the recipient
           master file (MMICMMO.BMKF3903) on a monthly basis.

3.17.11    The contractor shall produce and deliver to DMS, or its designated
           agent, a magnetic tape file containing the most current version of
           the lock-in file (MMICMMO.BMKB1025) on a weekly basis.

3.17.12    The contractor shall provide DMS with a weekly status report on RSU
           activities. This report shall include, at a minimum, the following
           information:

(1) Number of calls received (2) Number of calls resolved (3) Number of calls
referred to DMS
(4) Number of calls requiring a written response (5) Aging data on calls
requiring a written response (6) Number of written inquiries received (7) Number
of written inquiries resolved (8) Aging data on written inquiries awaiting a
response

3.17.13    The contractor shall provide traffic studies to DMS as requested on
           the usage of the toll-free lines designated for recipient inquiries.
           All costs related to these studies shall be the responsibility of the
           contractor.

3.17.14    The contractor shall produce and deliver to DMS, or its designated
           agent, a copy of the TPL master file (MMICMO.BMLF3900) monthly and
           TPL-2 letters and aged reports weekly.

3.17.15    The contractor shall produce and deliver to DMS, or its designated
           agent, after each financial cycle the following magnetic tapes:

(1)      Quality Control                    MMICMMO.BMDF5111
(2)      Claim Pay File                     MMICMMO.BBEF9800
(3)      Check Tape                         MMICMMO.BMDF4001
(4)      Backup Check Tape          MMICMMO.BMDF4001
(5)      RA Tape                    MMICMMO.BMDF6262
(6)      Backup RA Tape             MMICMMO.BMDF6263

3.17.16    The contractor shall produce and deliver to DMS, or its designated
           agent, the following magnetic tapes on the designated frequencies:

(1) Paid Claims History File, MMICMMO.BBEF9200 and MMCIMMO.BBEF9500, after each
month-end financial cycle. (2) Procedure, Drug, Diagnosis File, MMICMMO.BMEF5010
per request. (3) REOMB tape, MMICMMO.BMEF8001, approximately 25th day of each
month.
(4) LTACS Nursing Home File, MMICMMO.BMPF8100, after each month-end financial
cycle. (5) TPL-2 Extract file, MMICMMO.EWCF872B, on a weekly basis.

3.17.17    The contractor shall produce and deliver to DMS, or its designated
           agent, at least five (5) days prior to the scheduled provider
           checkwrite date, one (1) copy of microfiche of all remittance advices
           and electronic media claims billing information in each pay period.
           The microfiche must be clear, legible, and free of physical defects.
           Additionally, the contractor must retain the originals of the above
           microfiche for the duration of the contract and turn such originals
           over to DMS, or its designated agent, upon termination of the
           contract.

3.17.18    The contractor shall produce and mail the following required reports
           to HCFA Regional Office on a monthly basis:

(1) HMMR381M Claims Processing Throughput Analysis (2) HMMR481M Medical
Assistance Program Status

           These reports shall be provided to HCFA on paper or other media as
directed by DMS.

3.17.19    The contractor shall produce and transmit to DMS, or its designated
           agent, the 1099 data required by and for the Internal Revenue Service
           regarding provider earnings. This tape shall be produced in a format
           specified by DMS and must be delivered prior to the last working day
           of each calendar year.

3.17.20    The contractor shall produce and deliver to DMS, or its designated
           agent, reports on a monthly basis which provide statistics on volume
           of claims submitted electronically, method of submission, percentage
           of claims electronic, total number of unduplicated providers by
           provider type and any other pertinent information.

3.17.21 The contractor shall generate reports from the PA file on a monthly
basis in a format specified by DMS.

3.17.22    The contractor shall produce and deliver to DMS, or its designated
           agent, on a monthly basis a magnetic tape containing all active PA
           records.

3.17.23    The contractor shall produce and deliver to DMS, or its designated
           agent, the reference file maintenance report within one (1) working
           day of the processing of DMS requested reference file transactions.

3.17.24    The contractor shall produce and deliver to DMS, or its designated
           agent, one (1) microfiche copy of the drug formulary file quarterly
           for use by DMS.

3.17.25    The contractor shall produce and deliver to DMS, or its designated
           agent, upon request a listing of all NDC codes on file in NDC and
           alphabetic description sequence.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.17.25.1  Adhoc reports assigned to the programmer analysts must be
           successfully completed within no more than seven (7) working days of
           assignment or by a due date mutually agreed upon by DMS and the
           contractor. DMS will prioritize and assign due dates to these
           requests as necessary. Previously assigned requests will be taken
           into consideration when assigning due dates but the decision of DMS
           shall be final and without recourse. The primary responsibility of
           these programmer analysts shall be to respond to DMS initiated adhoc
           requests. However, if the work load permits, the contractor may
           utilize these programmer analysts to perform system maintenance
           (excluding priority STR work) and enhancement development work as
           long as this work does not negatively impact the timeliness or
           quality of adhoc reporting.

3.17.26    The contractor shall provide the first four hundred twenty (420)
           hours of CPU time per year at no additional cost to DMS. The
           contractor shall provide a monthly report showing the total number of
           CPU hours utilized for adhoc reports in the previous month and
           indicating the number of CPU hours used for each adhoc request in
           that month. Any CPU time exceeding four hundred twenty (420) CPU
           hours at the end of each fiscal year during which the contract is
           effective will be billable to DMS at the price set forth in the
           contract. Regardless of what model CPU the contractor operates the
           adhoc component on, the four hundred twenty (420) CPU hours provided
           annually shall be at least equivalent in performance to four hundred
           twenty (420) CPU hours on an IBM 9021-982 CPU Subsystem.

3.18     PERIPHERAL CONTRACTOR SERVICES:

3.18.1   Recipient Services Unit (RSU):

3.18.1.1   The contractor shall staff and equip a RSU to respond to Medicaid
           recipient's inquiries regarding claim payment or denial, program
           coverage, etc. Designate a supervisor for and adequately staff the
           RSU to ensure that all timeliness requirements specified below are
           met. The minimum qualifications for the recipient representatives
           shall be five (5) years of work experience in one of more of the
           following fields: health care provider relations, insurance claims
           processing, medical billings, medical diagnostic and procedure
           coding, bookkeeping or comparable record keeping, financial
           eligibility assessment, health care regulations development and/or
           enforcement, or similar work, of which two years must have been in an
           advanced capacity. Education in an accredited college or university
           may be substituted on a year-for-year basis for the general
           experience and for a maximum of one year of specialized experience.
           Graduate study in an accredited college or university in the areas of
           public, business or health care administration, nursing, medical
           technology, social work, finance, accounting or related areas may be
           substituted on a year-for-year basis for the general or specialized
           experience.

3.18.1.2   The contractor shall establish a telephone number that may be called
           toll-free by Medicaid recipients in and outside the State of
           Missouri. This number shall access a sufficient number of lines to
           ensure that ninety (90) percent of all callers will not receive a
           busy signal. Telephone calls that are not blocked by a busy signal
           shall be acknowledged within thirty (30) seconds and shall be taken
           by a recipient representative within one hundred eighty (180)
           seconds. Telephone calls shall be taken on all State workdays from
           8:00 a.m. to 5:00 p.m. Historical statistics on call volume is
           included in Attachment A. The contractor shall verify the
           identification of the caller by asking for name, DCN, date of birth
           and address. Address changes must be flagged on the RSU log.

3.18.1.3   The contractor shall establish a telephone voice logging system to
           monitor all telephone calls for quality purposes. Tapes should be
           stored for a minimum of one hundred (120) days and must include an
           indexing system for search capability by DMS staff.

3.18.1.4   The contractor shall complete TPL 4 forms when potential TPL leads
           are identified either through telephone or written communication with
           recipients. Completed forms must be forwarded to the contractor's TPL
           Lead Verification Unit, as described herein, for lead verification.

3.18.1.5   The contractor shall complete and mail Certificate of Creditable
           Coverage forms as requested by recipients.

3.18.1.6 The contractor shall print and mail provider county listings as
requested by recipients.

3.18.1.7   All written inquiries and those telephone inquiries that require a
           written response shall be responded to in writing within thirty (30)
           days of receipt of the inquiry. The contractor shall image all
           correspondence and retain in the imaging system to which DMS has
           immediate access.

3.18.1.8   The unit supervisor and each recipient representative shall have an
           on-line terminal located at his/her workstation for the purpose of
           assisting in the resolution of recipient inquiries. The RSU
           supervisor shall meet with DMS on a regular basis as established by
           DMS.

PARAGRAPH REVISED BY AMENDMENT #002:
3.18.2     Drug Rebate Dispute Resolution Unit: The contractor shall operate the
           drug rebate system in the MMIS. The system must genterate reports and
           letters to be sent to providers, generate manufacturer invoices and
           calculate interest.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.1 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.2 Deleted.

PARAGRAPH REVISED BY AMENDMENT # 002:
3.18.2.3   The contractor shall systematically apply drug manufacturer
           effective/termination dates based listings from the HCFA quarterly
           HCFA tapes provided by DMS. The contractor shall update public health
           service entity information based on listings provided by DMS. The
           contractor shall generate reports for DMS based on quarterly HCFA
           tapes.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.4 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.5 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.6 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.7 Deleted.


<PAGE>



PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.8 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.9 Deleted.

PARAGRAPH DELETED BY AMENDMENT # 002:
3.18.2.10         Deleted.

PARAGRAPH REVISED BY AMENDMENT #002:
3.18.2.11  The contractor shall enter the invoice mailing date into the on-line
           accounts receivable system in order for the system to calculate
           interest.

PARAGRAPH REVISED BY AMENDMENT #002:
3.18.2.12  The contractor shall produce and mail the drug rebate invoices to all
           covered drug manufacturers for drugs paid in the previous quarter.
           Invoices shall be produced in a format specified by DMS. The
           contractor must produce the invoices within one (1) week upon receipt
           of the rebate tape from HCFA. Invoices must be produced on paper,
           diskette or through a telecommunications network, as requested by the
           manufacturer. Mailing addresses and requested media must be
           maintained on the drug rebate master file. Payments for undisputed
           invoices will be acknowledged on the next invoice.

3.18.2.13  The contractor shall also produce thirty-eight (38) day letters and
           invoices and the URA discrepancy report and letters.

3.18.3   Third Party Liability (TPL):

3.18.3.1   The contractor shall staff and equip a TPL Lead Verification Unit to
           perform TPL verification on all leads supplied by DMS. Designate a
           supervisor for and adequately staff the TPL Lead Verification Unit to
           ensure that all requirements specified below are met. The minimum
           qualifications for the TPL unit supervisor shall be four (4) years of
           work experience in one or more of the following fields: health care
           provider relations, insurance claims processing, medical billings,
           medical diagnostic and procedure coding, bookkeeping or comparable
           record keeping, financial eligibility assessment, health care
           regulations development/enforcement, or similar work, of which one
           year must have been in an advanced capacity. Education in an
           accredited college or university may be substituted on a
           year-for-year basis for the general and specialized experience.

3.18.3.2   Verification includes, but is not limited to, phone calls to
           insurance companies or employers to obtain the most current health
           insurance policy information. The contractor shall follow procedures
           for verifying and adding information as outlined in the TPL Database
           Procedure Manual which can be found in the procurement documentation
           library. A lead is defined as including all recipients that are
           covered under a single policy. For instance, if a family of four


<PAGE>


          has health insurance coverage under one policy, this would be
          considered one (1) lead. Verified leads that are returned for
          correction due to contractor error will not be counted as a new lead.

3.18.3.3   DMS will supply leads for the contractor to perform TPL verification.
           After verification, the contractor shall update on-line to the State
           TPL database. The contractor shall have fifteen (15) working days
           from receipt of a lead to complete the verification and perform an
           on-line update to the eligibility file. Leads with insufficient data
           to verify shall be returned to DMS with notice of additional
           information needed to verify. Leads verified as invalid (i.e. there
           never was coverage, coverage does not relate to medical services,
           etc.) should be returned to DMS and noted with the reason not valid.

3.18.3.4 At a minimum, the contractor will be provided with the following
information to verify a lead:

(1) Recipient name and Medicaid DCN, or
(2) Resource name and address or phone number or employer name and address or
phone number, or (3) Policy number or policyholder SSN, or (4) Other recipient
identification data available on the MMIS recipient eligibility file.

3.18.3.5   The contractor shall collect TPL electronic lead updates from each
           MC+ health plans, the enrollment broker, the revenue maximization
           contractor and other state agencies (i.e. Child Support Enforcement).
           Updates are sent using a file transfer software package. The
           contractor shall maintain the TPL database to include all of a
           recipient's third party liability data.

3.18.3.6   Insurance company information (i.e. phone number, address, merges,
           etc.) shall be updated in to the insurance carrier file on a regular
           basis as specified by DMS.

3.18.3.7   The contractor shall work with DMS to provide reports for tracking
           the flow of TPL leads to the contractor and the timeliness of
           verifications. At a minimum, the reports shall include aging leads,
           verified leads and leads over ten (10) and fifteen (15) days reports.

3.18.3.8   The contractor shall maintain and operate the TPL recovery component
           of the claims processing subsystem. Maintain the capability for
           on-line editing of the TPL billing statements of those claims
           systematically selected for recovery. Produce and deliver to DMS the
           billing statements and/or facsimile claims, as requested by DMS,
           after each adjudication cycle.

3.18.3.9   For the purpose of submission of electronic TPL claim recoveries, the
           contractor shall establish and maintain connectivity through a
           commercial insurance claims clearinghouse (such as NEIC). This
           connectivity must allow for both the transmission and receipt of
           electronic TPL recovery data. TPL recovery claims being transmitted
           to the clearinghouse will be generated from the TPL subsystem within
           the MMIS.

3.19     MODIFICATIONS INTRODUCTION:

3.19.1     The contractor shall perform all modifications to the Missouri MMIS
           as requested and approved by DMS. All modifications shall be
           performed at no additional cost to DMS. The required staff of
           programmer analysts shall be utilized to accomplish this task.
           Increased operational costs as a result of such modifications shall
           not be reimbursed by DMS. Task requests that require only file
           maintenance or mass adjustments shall not be counted against the
           required programmer analyst hours. Hours counted against the research
           task requests shall not be applied to the required modification task
           hours unless system modifications are made as a result of such
           research.

3.19.2     DMS will request all necessary modifications to the MMIS. The
           contractor shall expend a minimum of 1,000 programmer analyst hours
           per week to the modification task. Only the hours devoted to the
           modification tasks performed by the twenty-five (25) programmer
           analysts required by Paragraph 3.6.2 (7) herein shall be applied
           towards the 1,000 hour minimum.

3.19.3    DMS will submit to the contractor a System Task Request (STR) with
          written instructions for each required modification, its priority
          status and required due date when applicable. The contractor shall
          initiate STRs for DMS approval when system problems are detected. The
          contractor shall review each STR and respond to the reasonableness of
          the due date within three (3) working days of receipt of a STR. The
          due date may be negotiated but the final decision authority will
          remain with DMS. The contractor shall complete each modification by
          the agreed upon due date and submit test documentation to DMS for
          review and approval. DMS will review and approve all system
          modifications test documentation prior to the implementation. The
          contractor shall implement each system modification upon written
          approval by DMS.

4.       PERFORMANCE STANDARDS AND REQUIREMENTS

4.1      LIQUIDATED DAMAGES - DELAY IN STARTING OPERATION:

           The contractor agrees that a delay in the approved schedule for
           starting operation of the MMIS system, including readiness testing
           and acceptance testing, will cause damage to DMS. In the event that
           such delay is attributable to the performance failure of the
           contractor, the contractor agrees to pay liquidated damages to DMS
           for such delay. The contractor further agrees that it may be
           impractical and difficult to ascertain and determine the actual
           damages sustained by DMS in the event of such delay. It is therefore
           agreed that the contractor shall, at the sole option of DMS, be
           required to pay DMS liquidated damages of twenty thousand dollars
           ($20,000.00) per DMS working day for each day, or part thereof, for
           such delay in the completion of the parallel test or structured data
           test, and forty thousand dollars ($40,000.00) per DMS working day for
           commencement of the Operation Task beyond the date in the approved
           schedule.

4.2      LIQUIDATED AND ACTUAL DAMAGES - FAILURE TO MEET CONTRACT REQUIREMENTS:

           The contractor agrees that a failure to meet the contract
           requirements listed below will cause damages to DMS. In the event
           that such failure is attributable to the performance of or lack of
           performance by the contractor, the contractor agrees to pay damages
           to DMS for such failure. The contractor further agrees that it may be
           impractical and difficult to ascertain and determine the actual
           damages sustained by DMS in the event of such failure. In such cases,
           the contractor agrees to pay liquidated damages. It is, therefore,
           agreed that the contractor shall, at the sole option of DMS, be
           required to pay damages to DMS for such failures according to the
           schedules set forth below:

4.2.1    System Documentation Requirement:

4.2.1.1    The contractor shall provide to DMS complete documentation of the
           operating system installed. Such documentation must be comprehensive,
           concise, detailed and presented in layman's terminology. All
           documentation must be provided to DMS by July 3, 2000. The contractor
           shall provide detailed program specifications and production
           documentation of the system in production on July 3, 2000. The system
           documentation shall be revised to include any enhancement packages
           implemented after July 3, 2000. The system documentation must also be
           revised for any system modification, if said implementation is after
           July 3, 2000.



<PAGE>


          Any enhancement package or system modification which does not result
          in a permanent alteration to the production system (special reports,
          for example) shall not require updating of system documentation,
          regardless of the date of implementation. These modifications shall
          require sufficient documentation for DMS to approve implementation;
          however, incorporation into the system described herein shall not be
          required. System enhancement and system modification documentation
          implemented after July 3, 2000 shall be due thirty (30) days following
          formal acceptance of the enhancement or modification by DMS.
          Documentation shall include, at a minimum: system overview narrative,
          systems flow chart, program input, program output, detailed reports,
          input/output matrix, database diagram, user manual, CPU time and print
          lines.

4.2.1.2    Liquidated Damages - The contractor shall pay liquidated damages of
           one hundred dollars ($100.00) per day for each working day from the
           date documentation or program listings are due until the date they
           are provided by the contractor.

4.2.2      Review Method - At least one (1) time per year, DMS staff will
           conduct an announced on-site system-wide assessment and training
           review of claims processing operations and peripheral services. The
           contractor will be given at least one (1) week notice prior to coming
           on-site. Notice will include the date of review and any required
           samples. A conference room suitable for eight (8) to ten (10) staff
           must be made available for approximately two (2) to three (3)
           consecutive days. It may also be requested that certain samples be
           prepared to review off-site, if necessary. Appropriate lead time will
           be given for samples to be reviewed off-site.

4.2.2.1    Any and all aspects of MMIS operations shall be subject to review
           with specific attention to those items with associated damages. An
           entrance and exit conference will be conducted prior to and at the
           close of the review. A written report of all findings will be
           presented within approximately two (2) weeks following the review. A
           due date for a plan of corrective action will be provided in writing
           depending upon the nature and extent of the findings.

4.2.2.2  Claims Control and Identification Requirement:

           All claims received in the mailroom must be assigned an ICN within
           one (1) working day of receipt in the contractor's mailroom. The ICN
           of all EMC claims shall be assigned upon entry into the claims
           processing system, as defined previously.

           Liquidated Damages: Samples of paper and electronic claims will be
           selected by DMS from the contractor's mailroom and/or logs used to
           record the receipt of electronic claims. DMS will take copies of
           paper claims received, but not controlled or batched, and will return
           such claims to the bin. Tapes and/or diskette logs must verify that
           the sampled claims were entered into the earliest available cycle.
           The contractor shall pay liquidated damages of one hundred dollars
           ($100.00) per day, per claim for each working day beyond the required
           time limit.

PARAGRAPH REVISED BY AMENDMENT # 002:
4.2.2.3  Timeliness of Processing Requirement:

           Ninety-nine percent (99%) of all error free claim transactions must
           be adjudicated within fifteen (15) calendar days of receipt in the
           contractor's mailroom. Ninety-seven and a half percent (97.5%) of all
           claim transactions which suspend for any edit must be adjudicated
           within thirty (30) calendar days of receipt in the contractor's
           mailroom. Exceptions may be made on a case-by-case basis for those
           claims that are delayed by DMS. The contractor shall provide
           documentation that shows the delay was attributable to DMS.

           Liquidated Damages: Samples of paper claims and electronic claims
           will be selected by DMS from the contractor's data entry unit and/or
           logs used to record the receipt of electronic claims. DMS will take
           copies of claims assigned an ICN but not data entered and will return
           such


<PAGE>


           claims to the bins. The contractor shall pay liquidated damages of
           one dollar ($1.00) for each claim that is not processed within the
           required time frame. In addition, the contractor shall pay liquidated
           damages of one dollar ($1.00) per calendar day, per claim until the
           claim is adjudicated.

4.2.2.4  Prior Authorization Control and Entry Requirement:

           The contractor must enter PA requests into the system within two (2)
           working days of receipt by the contractor.

           Liquidated Damages: A sample of PA requests will be selected from the
           requests received on the day of the sampling. The requests will be
           copied and returned to the bin. The contractor shall pay liquidated
           damages of ten dollars ($10.00) per day, per request for each working
           day beyond the required time frame until the request has been
           entered.

PARAGRAPH REVISED BY AMENDMENT # 002:
4.2.2.5  TPL Verification Requirement:

           The contractor shall verify all TPL leads supplied by DMS in a timely
           manner. Within fifteen (15) working days of receipt of a TPL lead,
           the contractor shall verify the lead and perform on-line updates to
           the eligibility file reflecting the appropriate result.

           Liquidated Damages: The contractor shall pay liquidated damages of
           $10.00 for each TPL lead which is not verified and updated on-line
           within fifteen (15) working days. In addition, the contractor shall
           pay liquidated damages of $10.00 per lead, per working day until the
           lead is correctly verified and updated on-line.

PARAGRAPH DELETED BY AMENDMENT #002:
4.2.2.6  Deleted.

PARAGRAPH REVISED BY AMENDMENT #002:
4.2.3      In addition, DMS has the right to perform focused studies of any
           contractor claim processing and operations functions apart from and
           outside of the annual inspection if specific problems are identified.
           If DMS determines a problem exists that has not been properly
           addressed by the contractor, DMS will give the contractor five (5)
           working days to submit a written proposal for corrective action,
           including a specific due date for correction of the problem.

4.2.4      If the contractor does not provide sufficient resolution to the
           problem, as determined by DMS, by the due date stated in the
           corrective action statement, DMS will withhold five (5) percent of
           the contractor's base operational invoiced costs for a period of time
           no less than thirty (30) days or until the next invoicing cycle,
           whichever is later. DMS will also require that the contractor provide
           written documentation explaining why the contractor was unable to
           correct the problems identified by the required due date. The
           contractor shall also provide in their statement a second due date
           for resolution of the problem.


<PAGE>



4.2.5      If the contractor does not provide resolution to the problem by the
           second specified due date, DMS will withhold an additional five (5)
           percent for a total of ten (10) percent, of the contractors base
           operational invoiced costs for a period of time no less than thirty
           (30) days or until the next invoicing cycle, whichever is later. DMS
           will again require that the contractor provide written documentation
           explaining why the contractor was unable to correct the problems
           identified by the second required due date. The contractor shall also
           provide in their statement a final due date for resolution of the
           problem.

4.2.6      Upon DMS approval of problem resolution, all withheld funds related
           to the identified problem will be released by the State as specified
           herein.

4.2.7      If, by the final due date, the contractor does not provide resolution
           to the problem or provide to DMS a plausible explanation of why the
           due date will not be met, DMS will require the contractor to meet
           with DMS management staff to develop the next course of action to be
           taken, up to and including additional withholds or enforcement of the
           default clauses of the contractual requirements outlined herein.

4.3      PAYMENT OF LIQUIDATED DAMAGES:

4.3.1      In the event of a claim by DMS that the contractor has failed to
           perform any of the requirements specified under items A and B above,
           and in the event that DMS exercises its option to require the
           contractor to pay liquidated and/or actual damages as specified
           herein, DMS will notify the contractor in writing of the claim and
           the amount due from the contractor as damages. If the contractor
           agrees with DMS' claim and the amount due, the contractor shall
           reduce the next regular monthly invoice by the amount due as
           specified by DMS.

4.3.2      If the contractor disagrees with either DMS' claim or the amount due
           from the contractor as damages, the contractor shall so notify DMS in
           writing within thirty (30) calendar days of receipt of the claim. If
           DMS and the contractor are unable to resolve their differences within
           thirty (30) calendar days of receipt of the contractor's response to
           DMS, DMS shall have the right to collect interest on any damages
           eventually resolved in favor of DMS. DMS will have the right to claim
           and to require the contractor to pay liquidated and/or actual
           damages, as applicable, for a requirement prior to completion of such
           requirement by the contractor.

4.3.3      DMS will neither claim nor require the contractor to pay liquidated
           and/or actual damages if the contractor fails to meet a requirement
           as a direct result of DMS' action or failure to act in accordance
           with its responsibilities as outlined in this document.

4.3.4      DMS will, at all times, retain the right to waive liquidated and/or
           actual damages at its discretion. In addition, if DMS determines that
           it is in its best interest, DMS may waive liquidated and/or actual
           damages in return for corrective or compensatory action on the part
           of the contractor.

5.       ENHANCEMENTS

5.1        A number of additional or different features and capabilities shall
           be included with the Missouri MMIS. These are grouped into
           "enhancement packages". The contractor shall implement all items of
           each enhancement package by the date specified in this document.
           Items within an enhancement package may be implemented separately or
           simultaneously, but in either case, they shall be implemented
           according to a work plan approved by DMS.

5.2        DMS will meet with the contractor prior to beginning work on each
           enhancement package to discuss details of the enhancements, schedule
           of deliverables and work plans. The contractor shall conduct detailed
           requirements analysis of each enhancement package. The requirement
           analysis shall include, at a minimum, a definition of the objectives,
           a description of input and output, and text describing the systems
           flow. DMS will review and approve requirement analysis for each
           enhancement package. The contractor shall make changes in the
           requirements analysis as requested by DMS and obtain DMS approval of
           the requirement analysis.

5.3        The contractor shall develop a general system design document for
           each enhancement package. The general system design document shall
           include, at a minimum, a general systems flow chart, narrative for
           each processing step, and test description of each input and output.
           DMS will review and approve the general system design for each
           enhancement package. The contractor shall make changes in the general
           system design document as requested by DMS and obtain DMS approval of
           the general system design document.

5.4        The contractor shall develop a detail system design document for each
           enhancement package. The detail system design document shall include,
           at a minimum, a listing of all input and output files, a detailed
           program flowchart, a description of changes made to each program,
           examples of format of any outputs and the conditions to be tested in
           the test results. DMS will review and approve the detail system
           design for each enhancement package. The contractor shall make
           changes in the detail system design document as requested by DMS and
           obtain DMS approval of the detail system design document.

5.5        The contractor shall develop testing procedures and related
           documentation. The documentation shall include, at a minimum, a
           detailed explanation of testing procedures, a listing of all
           conditions tested, expected outcomes for each condition, input used
           in the testing, output for the tests and an index cross-referencing
           all related items for each condition. DMS will review and approve
           documentation and test results for each enhancement package. The
           contractor shall obtain written DMS approval of programming and
           testing deliverables.

5.6        The contractor shall utilize the identical format, including
           indexing, division of documents by subject, etc., for each
           requirement analysis, general design, detail design and for test
           data.

PARAGRAPH REVISED BY AMENDMENT # 002:
5.7        The enhancement packages described herein must be completed by the
           due date shown below. Individual enhancements are grouped into
           packages for ease of tracking and contractor payment. Deliverables
           scheduled to be due on weekends or state holidays shall be actually
           due on the next business day.

           Enhancement Number and Description                     Due Date

           One - Recipient File Expansion                         03/01/2001
           Two - ARU                                              07/01/2000
           Three - On-line Changes/Search File Expansion          03/01/2001
           Four - Network Reporting                               07/01/2000
           Five - Point of Service/Internet Technology            09/01/2000
           Six - Decision Support System Operation                07/01/2001
           Seven - PA/On-line Claim Attachments                   03/01/2001
           Eight - Imaging/Workflow                               07/01/2000
           Nine - Surveillance and Utilization Review Subsystem   03/01/2001
           Ten - Third Party Liability Case Management System     06/30/2001

5.7.1    ENHANCEMENT 1 - Recipient File Expansion

Many programmatic aspects of Missouri Medicaid are driven by the conditions of
individual recipient eligibility. Since Missouri Medicaid's recipient
eligibility requirements are comprised of multiple levels of assistance and are
subject to frequent change, it is crucial for the MMIS to distinguish between
potentially overlapping eligibility categories and edit from that data
accordingly. Because of the increased complexity of the various Medicaid benefit
"packages", it is obvious the existing recipient file


<PAGE>


and recipient-based editing no longer meet the needs of DMS. Comprehensive
modifications to the recipient file and the subsequent editing are needed to
expand the information available, to ensure that all current and historical
recipient-based processing is occurring appropriately and that recipient-based
transaction histories can be tracked on an individual client basis. This will be
accomplished by meeting the criteria outlined herein.

5.7.1.1    The current MMIS resides in a VSAM sequential processing environment.
           To facilitate many of the changes required in this enhancement, the
           contractor must convert at least the recipient file of the MMIS to a
           DB2 relational database structure.

PARAGRAPH REVISED BY AMENDMENT # 002:
5.7.1.2    The current system only applies updated information as it is passed
           from the Division of Data Processing (DDP), overlaying all previous
           data. DMS requires that updates to the recipient file be stored for
           inquiry and editing. All historical data is to be retained for a
           period of at least three (3) years and must allow for the retention
           of the minimum number of occurrences per transaction, as listed
           below. The number of unique fields should be expanded to allow for
           each of the following data elements to include, but not be limited
           to:
o        name changes (5 occurrences);
o        address changes (5 occurrences);
o I.D. card issue dates and reason codes (12 occurrences); o eligibility detail
transactions with date ranges (36 occurrences); o managed care enrollment detail
transactions with date ranges (36 occurrences); o primary care physician
histories (36 occurrences); o nursing home level of care segments with date
ranges (36 occurrences); o nursing home surplus amounts (36 occurrences); o
county code changes (36 occurrences).

           Included as part of the editing for these updates should be a "LAST
           UPDATE" indicator to show the last date a recipient record was
           updated and what data field was affected.

           The method for updating and retaining these elements may be
           determined by the contractor - either by way of `rolling overlay
           screens', creating separately edited fields for each element or by a
           means not indicated here, contingent upon approval of DMS. However,
           all data must be accessible for both inquiry and claims/PA/service
           tracking editing functions.

5.7.1.3    The contractor must create detailed service tracking histories (the
           claims history portion of this is outlined in enhancement package 3).
           The services should be summarized on the recipient file with built in
           "hot key" links to the service tracking file (again, being created
           with enhancement package 3). Services to be tracked for each
           recipient on the recipient file must include, but not be limited to:
o EPSDT/immunization history; o behavioral health services; o restricted optical
services; o annual cumulative home health visits; o once-in-a-lifetime
procedures; o chronic disease or condition.

           Links to the service tracking file must include all ICNs included in
           the summary of data on the recipient file.

5.7.1.4    Claims processing must be changed to enable recipient eligibility
           determinations to be made on the detail level of the claim instead of
           the current procedure of eligibility verification occurring on the
           header level. Detail editing must occur for initial eligibility,
           assignment of ME code, third party resources, managed care
           enrollment, age and all other edits currently done on the header
           level. Not only should this editing occur on the detail level, but in
           addition, the claim record must be expanded to store this information
           on the detail level for historical reference. This detail editing
           will allow for more comprehensive and accurate claims processing as
           well as accommodate for the existing problem of determining
           eligibility for recipients with multiple and/or overlapping
           eligibility and managed care enrollment.

5.7.1.5    Current procedures dictate that when eligibility and managed care
           enrollment data are passed from DDP, the managed care enrollment data
           is applied to the recipient file prior to eligibility. As a result,
           if both a new eligibility segment and managed care enrollment segment
           is passed for a newly eligible recipient, the managed care enrollment
           record errors off since it cannot match the record to an eligibility
           segment. Therefore, the contractor must either apply eligibility
           prior to managed care enrollment or modify the application of these
           data elements to happen concurrently.

5.7.1.6    The contractor must develop logic for cross-referencing of all
           recipient data for recipients with multiple DCNs. This logic must
           allow for the combining of all recipient base data including lock-in
           as well as all claims and PA files. The current process is not true
           cross-referencing but rather creates an indicator on the invalid DCN
           "pointing" it to the valid one. Frequently, claims and PA data is
           lost in the process. Steps must be taken when developing these
           changes to ensure no data is "orphaned" in the cross-referencing
           process. These modifications should be planned to work in conjunction
           with the related portions of the on-line enhancement package as well
           as the PA enhancement package.

5.7.1.7    The contractor shall develop a method for systematic adjustments to
           be generated for deceased recipients. When a date of death is passed
           to the MMIS by DDP, the system must determine if claims have been
           submitted and paid with dates of service following the date of death.
           If paid claims or capitation payments are found, an adjustment should
           generate.

5.7.1.8    Information on case data is passed from DDP by way of a "CASE-NO".
           All recipients who are in the same "case" (household) have the same
           "CASE-NO". There is currently no way to inquire on all individuals on
           the same case without ad hoc reporting or referencing other systems.
           Create a way to identify an inquire on all DCNs that have the same
           CASE-NO assigned to them.

5.7.2    ENHANCEMENT 2 - REPLACEMENT OF AUDIO RESPONSE UNIT (ARU)

With the diversity and continued expansion of Missouri Medicaid's various
managed care and fee-for-service programs, DMS has become increasingly aware of
the need to replace the existing ARU system and develop an enhanced automated
interactive voice response system to work in conjunction with the existing
on-line MMIS. This enhanced system must allow providers toll-free inquiry access
to multiple pools of data using a touch-tone telephone. A digitized voice system
with additional text-to-speech capability for proper name pronunciation is
preferred but an exclusively text-to-speech system is acceptable as long as the
speech is clearly understood. The system must meet industry-standard
requirements and perform to meet the criteria outlined herein.

5.7.2.1    The inquiry system must allow access to detailed on-line information
           using multiple `stair-step' functionality - i.e. "press 1 for
           recipient eligibility, press 2 for provider check verification,
           etc..."; then, within each option, provide sub-options - i.e., if
           option 1 is chosen for recipient eligibility verification allow for
           "press 1 for managed care enrollment information, press 2 for
           Medicare eligibility information, press 3 for TPL information,
           etc...".

           The inquiry system must provide verification of detailed on-line
           information including, but not limited to:
o        recipient name, date of birth and SSN;
o        recipient eligibility categories and effective dates;
o        recipient managed care enrollment status,  effective dates,  primary
                care provider and health plan contact
                information;
o        recipient Medicare and QMB eligibility and effective dates;
o        recipient third party resource (TPL) information;
o        recipient-specific benefit allowances, limitations, and copays;
o provider check verification including remittance advice (RA) number, RA date
and amount of payment; o provider claim status inquiry including RA number, RA
date and amount allowed if claim has paid or
                reason for denial if claim was not paid (a text message for
                denial messages is preferred but quotation of the MMIS EOB codes
                is acceptable);
o               procedure code verification including code status, pricing
                information and effective date of price; if provider needs price
                earlier than the most recent, they should have the option to
                `drill down' into historical pricing data.

           All response data must come directly from the on-line MMIS files, not
           created through file extracts or stored copies.

           Inquiry must be allowed by input of at least the recipient
           identification number (DCN), recipient SSN or recipient name. The
           inquiring provider's identification number must also be input as well
           as a range of dates of service for which they are inquiring.

           Providers must be allowed access to the inquiry system if they are
           actively enrolled or if they WERE actively enrolled on the dates of
           service for which they are inquiring.

           Callers must be given the option to transfer to a member of the
           hotline staff or have all or partial response data repeated if
           desired.

           All calls must be assigned a confirmation file number (see item #2)
which is read to the caller.

5.7.2.2    The inquiry system must allow for pre-recorded informational messages
           that can be updated at the state's discretion. The callers must be
           able to choose which messages they want to listen to.

5.7.2.3    The verification system must work in conjunction with or replace the
           existing eligibility confirmation file, which stores all response
           data in a reference file accessible on-line. If the system will work
           with the current confirmation file, considerable expansions will be
           required to include all data elements included in an inquiry
           response. If a new file format is created, the file must contain all
           data elements included in an inquiry response.

5.7.2.4    With the constantly changing health care environment, the system must
           be easily reconfigured to provide new and modified types of response
           data. It is suggested, but not required, that this may best be
           accomplished by use of industry standard software that allows for the
           monitoring, modification and programming of an interactive voice
           response system through a Windows environment. Ongoing changes to the
           system will be requested through the System Task Request (STR)
           process. The contractor must have at least one member of their
           programming staff who is proficient in the operation and modification
           of the complete inquiry system.

5.7.2.5    DMS requires the system to be accessible through one toll-free
           number, with the cost of the line to be passed through to DMS. The
           toll-free number must allow access for both in-state and out-of-state
           callers. All incoming calls should be distributed between 50-60
           ports. (Historical usage illustrates this number of ports provides
           sufficient access to the eligibility verification system. However, if
           usage should increase, the system must be able to expand to meet
           increased traffic.) The inquiry system must be available 24 hours a
           day, seven days a week with the exception of scheduled system
           maintenance.

5.7.2.6 The provider must allow a mechanism for batch verification for high
volume providers.

5.7.2.7    The system must include applications for monitoring, troubleshooting
           and reporting of system activity and problems. DMS staff must have
           access to this monitoring application.

5.7.2.8    The contractor must be responsible for all costs relating to
           maintenance and expansion of the industry standard equipment and
           technology employed for the system to ensure long-term compatibility
           and use of the system.

5.7.2.9    Access to the eligibility verification system is also currently
           available to providers through Point of Service. This capability must
           be preserved when modifications are performed to replace the existing
           ARU system.

SPECIAL NOTICE FOR OFFERORS:

The incumbent contractor utilizes a portion of DMS' ARU system for use in their
recipient services unit. The cost of implementing that portion of the system as
well as ongoing programming and maintenance is the responsibility of the
incumbent contractor. However, all connectivity and monitoring was done through
the DMS owned system. This option will not be available as part of the resulting
contract. If the contractor chooses to employ the use of an interactive voice
response system, they must do so at their own expense. If the contractor wishes
to link their system to DMS' inquiry system, offerors must itemize the cost of
their system versus the DMS system.

5.7.3    ENHANCEMENT 3 - On-line Changes/Search File Expansion

The Division of Medical Services (DMS) desires to increase access to information
within the MMIS, by establishing service tracking mechanisms, restructuring
menus and files, and adding additional "hot key" options, among others. The
contractor shall be responsible for completion of the following changes.

5.7.3.1  OPTION 01:        PROVIDER MASTER FILE

1.       Modify the file structure and on-line screens of the Provider Quality
         Review screen (Options 7 and 8), so that it is possible to review the
         update/ addition quality sample by Clerk ID and/or date of update.
         Currently records are displayed in provider number order only.

2.       Create a pop-up window for remarks regarding a selected provider that
         appears upon entry into the provider inquiry screen. Include an
         indicator that shows providers with an active Remarks screen.

3.       Expand the provider file so that all indicators are on one screen. In
         some instances, the system should auto-plug indicators based on
         predefined criteria. Currently there are 15 indicators in use.

4.       Add the capability to auto-plug redundant information to multiple
         provider files within a group, such as electronic billing indicators.
         Some groups and teaching institutions have over 600 members.

5.       Expand the provider base record member screen (screen 5) to increase
         the maximum number of members (currently 600). Editing changes will be
         necessary with this change.

6.       Create separate fields for EIN and SSN. Currently, one field is used
         for either the EIN or SSN.

7.       Add more fields/space to key name and address information. It is
         desired to expand the Name, 1st Address line, and 2nd Address line to
         include at least 40 bytes of information.

8.       Add fields for Fax telephone numbers and E-mail/Internet addresses.

9.       Create additional provider Status Codes. There will be related editing
         tied to these indicators.

10.      From the provider base record, create a function to allow user to type
         over provider number at top of screen, hit enter, and retrieve a new
         provider file.

11.      Add the following "hot key" functions:

 a.      Add the capability to place cursor on the SSN or EIN fields to pull-up
         all providers with the same SSN or EIN.

 b.      Add the capability to place cursor under provider number anywhere in
         provider file and hit enter to retrieve that provider file. Same logic
         as Screen 5.

12.      When using the 01 Option and inquiring by name, tax number, etc.,
         change to allow scrolling backward. Currently, scrolling forward is the
         only option.

13.      Option 11 within the provider file needs restructuring, to include, but
         not be limited to the following:

 a.      On-line selection criteria must include at a minimum: name, ID number,
         health plan, provider county, and provider category. The capability
         must exist to limit a search further by entering more than one element
         (i.e.; health plan and provider category would list only those
         providers with a particular health plan that are classified in a
         specific category.)

 b.      The Managed Care Provider Detail must display all current fields plus:
         health plan name, provider specialty, provider county, number of MC+
         enrollees accepted (panel limit), established patient indicator, and
         last update field. The Provider Detail must also display up to five
         occurrences of provider sites with an indicator that will confirm
         whether there are additional sites in excess of five. (Currently the
         provider demographic layout will accommodate up to fifteen sites
         associated with a single provider ID.) In addition, the detail screen
         must carry a history of provider effective start and stop dates up to
         ten occurrences, with a last change date for each.

 c.      A cross reference for the Participating Health Plan Table should be
         developed based on more than one data element. Currently, the cross
         reference is based solely on provider ID; however, plans A and B may
         assign the same provider number, but it may represent a different
         provider in each plan.

 d.      The cross reference table must include a hot key function that will
         display a separate detail screen for the selected plan.

 e.      Scrolling back and forth between managed care detail screens must be
         available as opposed to having to re-select for each detail from the
         managed care provider list.

14.      Change the Prepayment Review function needs to include options of
         allowing authorized users to target certain procedures for review and
         use future prepayment review effective dates. There will be additional
         minor modifications and editing included with this change.

15.      Create additional inquiry selections and print options from the main
         menu of the provider master file. Allow user to inquire by single
         selection or by a combination of selections.

16.      Within option 09, allow user to select a record for viewing from the
         retrieved list. When exiting the record, return user to the list
         screen.

5.7.3.2  OPTION 02:        CLAIMS INQUIRY

1. Add the ability to hot key from a selected paid or denied claim, to the
attachment file and back.

2. Create a "Help Index" pop-up window to various screen options and information
throughout the MMIS.

3. Change the format of the current pop-up screen to include the following
options:

 a.      Allow entry to the Precert option using an "X", to reach the menu,
         rather than having to use precert number.

 b. Add the browse capability on procedure codes from the pop-up.

 c. Add access to the attachment file from the pop-up screen.

4.       Use hot key function to view exception numbers from the exception
         number itself. Use the help index (#2 above) to assist user in the
         types of denial indicators such as "2" is autodeny, "3" is suspend,
         etc.

5.       Include ability to hot key within the related history option to view
         claim information, provider information, and procedure information.

6.       Restructure all crossover claim screens to capture all available
         information from crossover claims, using record layouts specified by
         DMS. New editing will be included with these changes.

7.       From the Option 02 main menu, be able to select RA dates by month and
         year (if date is unknown) and have system sort by claims with first RA
         date and claims within second RA date.

8.       Create new claim selections to view paid/denied/voided claims and
         retrieve Remittance Advice (RA) information by month and year (if user
         is unsure of date). Create combination claim selections to refine a
         search (i.e. all denied inpatient claims, for one recipient, on a
         particular RA).

9.       Add access to view all claim records for a recipient with multiple
         DCNs.

10.      Allow retrieval of claim information by (1) All claims without
         fee-for-service; (2) All claims without encounters; (3) All claims
         (both fee-for-service and encounters).

11.      Add capability to scroll from claim to claim without having to exit
         current claim and selecting the next claim from the claims list.

12.      Add capability to hot key from claim, to PDD, (which is currently
         possible), then from PDD to Med Crit (new). Utilize security file
         restrictions to disallow users access to these files, if indicated.

13.      Indicate the exact number of claims within selected file. Eliminate the
         current 20 of 120+.

14.      Create a secondary sort by performing provider numbers, within the
         claims summary, when a group provider number is the primary sort.

5.7.3.3  OPTION 04:        PROCEDURE, DRUG, DIAGNOSIS

1.       Restructure of the menu and files within this portion of the MMIS.
         Include cross-walk capability to tie previous and new CPT/HCPCS codes
         together.

2.       Add hot key function to move from a procedure code base record to the
         Medical Criteria File for that procedure.

3.       Increase the number of procedure  pricing lines to include an
         additional 4 or 5 lines.  Also increase the
         number of NDC pricing lines to a minimum of 10 lines.

4.       Within the diagnosis base records, include effective dates for active
         and inactive status. Create a new status for encounters only.

5.       Create a selection inquiry option from the Generic Drug Inquiry screen.

6.       Accept 4-digit diagnosis codes for encounters. Add effective dates to
         detail diagnosis information.

5.7.3.4  OPTION 05:        CARRIER FILE

1. Make this Option inactive and incorporate into Option 21: TPL Subsystem.

5.7.3.5  OPTION 07:        ELIGIBILITY CONFIRMATION

1. Change to allow date of service to be optional on eligibility file
confirmation inquiries.

2.       Include at least one (1) year of on-line information and two (2) years
         of history.

3. All information accessible on the ARU must be made available on the
confirmation file.

5.7.3.6  OPTION 09:        PRE-CERTIFICATION

1. Must show all admission certification denied days.

5.7.3.7  OPTION 10:        MEDICAL CRITERIA

1.       Add last update fields.

2.       Add hot key capability to medical criteria screen for limit
         parameters/diagnosis.

3.       Expand size of procedure/diagnosis list, such as with parameters.

4.       "Help Index" pop-up Place of Service, Provider Specialty, and Provider
         Type.

5.       Provider Type and Specialty fields should be expanded and any updates
         should be in numerical order.

6.       Make the necessary system changes which will allow the assignment of
         different group numbers for diagnosis codes in the Institutional
         Criteria Option. (STR S-41)

7.       Create a browse option when searching procedure codes within Medical
         Criteria.

5.7.3.8  OPTION 11:        SERVICE TRACKING

1.       Option 11 is currently not used. Create a new Service Tracking option
         that will track services such as: Behavioral Health, Home Health
         Visits, Optical Services, Once-in-a-Lifetime services, Durable Medical
         Equipment.

2.       New editing will be necessary.

3.       Hot key functions will need to be added in the claims inquiry option of
         the MMIS. The user must have the ability to hot key from a claim record
         back to the service tracking file or from the service tracking file to
         the claim record.

4.       The service tracking system should be sorted by recipient number first,
         then by provider number.

5.7.3.9  OPTION 15:        SYSTEM PARAMETERS

1.       Include an automatic sort in alpha or numeric order when adding
         procedures or other alpha/numeric information to a parm.

2.       Create a Last Update Field.

3.       Create an Active/Inactive Indicator Field to show the current status of
         the Parm. Also reference latest O-Type STR.

5.7.3.10 OPTION 16:        TEXT & EXCEPTION CODE

1.       Systematically plug all related Exceptions (in Related Exceptions
         field) to all EOBs.

2.       Restructure the Remittance Advice (RA) message option to allow spacing
         between RA messages when printing. Allow the capability to carriage
         return, and emphasize wording (i.e. underline or bold). Create option
         of choosing Regions, rather than specifying each county code.

5.7.3.11 OPTION 20:        MANAGED CARE

1.       Include the entire capitation rate history on the rate table and add
         ability to scroll within rate table by health plan and aid category
         within sequence by contract year or by entering specific contract year
         or date of service.

5.7.3.12 OPTION 21:        TPL SUBSYSTEM

1. Move Option 5 of the MMIS to this option.

5.7.3.13 OPTION 22:        DRUG REBATE INFORMATION

1.       Identify inconsistencies between rebate amount due and amount paid to
         pharmacy. Flag for review based on state guidelines.

2.       Provide the capability to accept payments from the drug manufacturers
         electronically.

3.       Provide the capability to transmit requested detailed drug claim
         listings electronically.

4.       Validate for consistency of measurement of units between HCFA and MMIS
         drug reference data and provide automated conversions where specified
         by the state.

PARAGRAPH REVISED BY AMENDMENT # 002:
5. Provide the capability to separately identify drug rebate amounts by program
and eligibility category.


<PAGE>



6.       Provide for the capability to receive manufacturers dispute information
         electronically.

7.       Provide an automated mechanism to subject each disputed prescription to
         a series of queries which compare the billed amount, quantity paid, and
         system-calculated allowed amount (the maximum amount the state would
         pay of the prescription) in order to identify the universe of claims
         for the disputed products.

8.       Create drug rebate dispute spreadsheets and reports.

5.7.3.14 OPTION 23:        ACCOUNTS RECEIVABLE (A/R)/CASH CONTROL

1.       Allow user the ability to return to the financial summary transaction
         list following inquiry of a selection on the list.

2.       Change the navigation within this option to be more user-friendly.

3.       TPL/Medicare TPL/Billing error overpayments, by using a specific
         payment code when writing off overpayments, create a system generated
         report of all overpayments that are to be refunded, based on specific
         payment codes. Send information to DP for check issuance. Allow ability
         to delete information as necessary. The MMIS should use the payment
         information to update provider 1099 files when appropriate. The
         information needed for check payee would be the header information on
         the A/R base. If the check should be written to another party, have
         capability to modify the information before being sent to DP.

4.       The above system can be used in issuing special checks. Set up A/Rs
         that would allow users to payout the money and recoup when applicable.
         Add capability of entering information directly into the he check
         writing system. Weekly cut off dates and weekly check writes would be
         established.

5.       The Bill Processing System Test (BPST) would eliminate the use of
         warrant reports necessary for payment on Medicaid recipient
         reimbursements. Payment information would be contained in the system
         and should be available on-line. Information would need to be
         maintained for any tax purposes that might apply.

6.       Establish a direct link between claims and A/Rs using hot key
         functionality to move between.

7.       Create a year-to-date summary section containing earnings information
         regarding the number of claims paid, denied, suspended, adjusted.
         Include financial transactions for the current pay period, and
         year-to-date period. Include 1099 information in this summary.

8.       Provide for electronic crediting of paid claims by providers initiating
         credits back to the Medicaid program.

9.       Develop an on-line mass adjustment selection screen, limited to select
         users, to enter selection parameters such as time period, provider
         number(s), recipient DCNs, service code(s) and claim type(s), claims
         meeting the selection criteria will be displayed for initiator review
         and the initiator will have the capability to select or deselect chosen
         claims for continued adjustment processing. Also, must have capability
         to access original mass adjustment from the mass adjustment ICN in
         on-line claims history.

PARAGRAPH DELETED BY AMENDMENT # 002:
10.      Deleted.

11.      Develop a process to accommodate the issuance and tracking of
         non-provider-specific payments through the MMIS (i.e. refund of an
         insurance company overpayment, recipient payments) and adjust
         expenditure reporting appropriately.

12.      Develop a process for garnishments and tax levies and assignment
         information to be used in directing or splitting payments to the
         provider and garnishee.

13.      Generate overpayments (credit balance) letters to providers when
         establishing accounts receivable for select situations.

14.      Account for non-negotiated warrants in the system to aid bank account
         reconciliation and resolution of inquiries (i.e. payments never
         cashed).

15.      Void all non-negotiated provider checks within six (6) months.

5.7.4    ENHANCEMENT 4 - Network Reporting

The Division of Medical Services is desiring to replace the production of
microfiche and hard copy with an application that will provide new storage and
viewing functionality and be available on a local area network. The storage and
viewing functionalities will prove beneficial to DMS by dramatically decreasing
the cost of printing and microfilming reports, decreasing the amount of physical
space required for storage of this information, and provide users with timely
access to report data by allowing retrieval from their workstations. The
following represents the minimal requirements of the new system. The contractor
must:

5.7.4.1 Provide a system that will reside on the contractor's network and
accessible to all DMS staff.

5.7.4.2    Make all MMIS reports, including ad hoc reports if required by DMS,
           available to users through the new system. Reports must be viewed
           exactly as they appear when printed.

5.7.4.3    The system must allow data from reports to be exported to other
           software packages, such as spreadsheet packages or graphics packages,
           to allow for analysis and manipulation of data by user.

5.7.4.4    Allow users to retrieve and display, in an average of thirty (30)
           seconds or less, the first page of a report that is less than three
           (3) years old. Each subsequent page of the same document must be
           displayed in one (1) second or less.

5.7.4.5    Allow access to reports that have been stored for more than three (3)
           years, within four (4) hours. Conversion of current microfiche to
           this system will not be required.

5.7.4.6 Allow for targeting the distribution of certain reports to certain
units/individuals as directed by DMS.

5.7.4.7 Make available appropriate security levels to restrict access when
necessary and directed by DMS.

5.7.4.8  Reports must be accessed through a series of menus and index options.

5.7.5    ENHANCEMENT 5 - Point of Service/Internet Technology

The Division of Medical Services desires to expand accessibility of electronic
claim management technology to all Missouri Medicaid providers through Point of
Service (POS) and the Internet resulting in a faster and more efficient Missouri
MMIS. In addition to claim and encounter submissions, other electronic options
shall be made available through the Internet as described herein.

Currently, electronic claim and encounter submissions are received via tape,
diskette, PC to PC, on-line and with file transfer software. The contractor
shall be required to develop POS and Internet capabilities to support all claim
types used in the Medicaid program. The contractor shall also develop a process
for providers to submit an electronic adjustment, regardless of the type of
claim submission. The contractor shall make every effort to make the
POS/Internet claim and encounter submissions available on a twenty-four (24)
hour a day, seven (7) days per week basis except for scheduled maintenance.

5.7.5.1    Point of Service (POS): Currently, Missouri Medicaid utilizes the POS
           system for on-line adjudication of pharmacy claims only. This system
           must be expanded to accept all claim types. The system must provide
           on-line adjudication, on-line claim credit/adjustment capability and
           a method of claim(s) capture for all claim types. The claims will be
           captured, processed and adjudicated in real-time. The contractor
           shall provide the capability to perform real-time editing of
           electronic media claims and real-time response back to providers for
           claims.

           The following objectives have been established for this enhancement:

1.       The contractor shall provide on-line adjudication of all claim types.
         On-line adjudication instantly notifies the provider of the outcome of
         the claim submission. A confirmation record indicating if the claim was
         accepted or rejected must be sent back to the provider. As part of the
         confirmation record, the layouts for all claim types should be expanded
         to contain recipient eligibility verification and copay information. If
         the claim was rejected, the confirmation record should identify the
         errors and allow the provider the opportunity to resubmit the claim.

2.       The contractor shall provide for a method of claim credit/adjustment.
         Claim credits/adjustments allow the provider to resubmit or correct a
         claim submission.

3.       The contractor shall provide for a method of claim(s) capture. This
         method will allow the provider to submit claims for batch processing,
         if desired.

5.7.5.2    Internet: The contractor shall develop a process to expand the
           Internet capabilities for the Missouri Medicaid program. Currently
           through the Internet, providers have access to Missouri Medicaid
           program manuals. A system must be developed to allow for claim and
           encounter submissions, as well as other features as described below.

           The contractor shall secure written DMS approval prior to releasing
           any material on the Internet. All data transmitted via the Internet
           must be protected by appropriate security, identification and
           encryption that meets all relevant Federal and State regulations. The
           contractor shall take all reasonable precautions to ensure
           appropriate levels of security and confidentiality to block Internet
           users from unauthorized access to files, data or programs. The
           contractor shall comply with the security standards as defined by DMS
           to assure that electronic transmissions of health information
           pertaining to an individual remains secure. The contractor shall
           develop, implement and maintain appropriate security measures and
           shall secure prior written approval from DMS before the
           implementation of any security measures. The contractor shall also
           document the security measures and insure the security measures
           remain current.

           The other features that should be made available by using the
Internet are:

1.       A process must be developed to accept prior authorization requests and
         claim attachments in an electronic format (i.e. second opinions,
         Medical Necessity forms, operative reports, etc).

2.       Eligibility verification must be available to providers through the
         Internet in real time. This feature would allow the provider community
         access to the same information currently available from the ARU
         (eligibility, claim status, etc.). Through the Internet feature,
         eligibility verification must be available twenty-four (24) hours a
         day, seven (7) days per week except for scheduled maintenance.

3.       A process must be developed to allow providers access to electronic
         remittance advices (RAs) via the Internet and allow on-line access to
         confirmation reports. This would allow providers to automate their
         billing and posting process.

4.       The contractor shall develop a Help Index on the Internet that is
         applicable to the Missouri Medicaid Internet options.

5.       The contractor shall develop a process for providers to access the
         explanation of benefits (EOB), exception lists and various other
         on-line files currently utilized by Missouri Medicaid.

5.7.6    ENHANCEMENT 6 - Decision Support System Operation

         The Division of Medical Services contracted for a Decision Support
         System (DSS) that was developed by the MEDSTAT Group. The MEDSTAT Group
         is the sole proprietor of all licensing and rights of the database
         software, design software and update software. The DSS is run on the
         State Data Center mainframe. The current fiscal agent responsibility is
         to provide extracts of the eligibility, claims, provider, reference and
         prior authorization files.

         It is the intent of DMS for the contractor to assume the on-going
         operational requirements of the Decision Support System. The MEDSTAT
         Group contract provides the general, specific and technical
         requirements necessary to operate the DSS.

5.7.6.1  The contractor shall be required to:

1. Provide necessary hardware to run the existing Decision Support System (DSS);

2. Provide quarterly updates to the (DSS);

3. Provide programmer support for maintenance and update of the DSS Database.

5.7.6.2    If the cost of this enhancement precludes shifting of responsibility
           to the contractor, DMS may choose not to shift responsibility and
           payment to the contractor.

5.7.7    ENHANCEMENT 7 - PA/On-line Claim Attachments

In the current claims environment, claims adjudication frequently requires
reference to provider-supplied service information in addition to that included
on the individual claim form. To facilitate claims processing in these
instances, DMS would like to enhance the current prior authorization process in
addition to creating an attachment file that can be referenced by claims
submitted by multiple providers.

Currently, the prior authorization process is both labor and paper intensive and
includes no real mechanism for status tracking and reporting. After being
scanned, numbered and keyed, documentation is transferred between various clerks
and reviewers, with clerical staff entering on-line a final disposition per the
reviewer's decision. The current method also involves the return of original
documents with missing information or with a response by the reviewer, and
includes no process for scanning the amended document once approved or denied.
To increase efficiency of the process and to enhance information available to
the user, the contractor shall be responsible for the following process and
on-line improvements:

5.7.7.1  Process Improvements:

1.       The contractor must develop a method in which prior authorization
         inventory (this includes initial requests, requests for changes, and
         requests for reconsideration) is identified and sorted uniquely by
         program type, and is tracked and reported based on location, status,
         and age.

2.       All prior authorization inventory must be entered on-line with the
         exception of requests with a missing or invalid recipient or provider
         number. Each prior authorization entry will be subject to on-line
         editing to include data validity (missing or invalid required fields),
         recipient eligibility restrictions (ie: managed care lock-in, recipient
         age vs. procedure), provider type vs. type of service/procedure code,
         overlapping authorization periods, and services not requiring prior
         authorization. Requests with missing or invalid recipient or provider
         number will be returned to the provider accompanied by an instructional
         form letter.

3.       Requests failing front-end on-line editing will receive a status other
         than denied, and system-generated letters of explanation shall be
         produced and returned to the provider within 3 working days of receipt.

4.        Original documents shall not be returned to the provider other than as
          specified in point number 2 or as otherwise directed by DMS. Any
          original documents (including reviewer notes) must be retained for a
          minimum of 45 calendar days. Following disposition (ie: on-line
          editing or manual review), a separate written response shall be
          returned to the provider. The response shall contain at a minimum the
          following information: recipient name/DCN, provider name/number,
          request receipt date, disposition date, TOS/procedure requested,
          service description, status, status reason code/description, any
          authorized units/dollar amount, any authorized from and through dates,
          a unique reference number, and reviewer comments. An on-line option
          must be available that will re-generate a disposition letter for any
          PA reference number on an as needed basis.

5.       A separate method for submitting, tracking and reporting must be
         developed for changes to an existing prior authorization or requests to
         reconsider a denied prior authorization. Such requests must be
         systematically linked to the original unique reference number.

6.       All documents containing information associated with each request
         (including consultant/reviewer notes or instructions) must be imaged
         and linked to the original imaged request.

5.7.7.2  On-Line Improvements:

1.       The contractor must incorporate the following new search options: by
         specific provider number, by earliest date of service (any keyed date
         of service will bring up PA's with the first date of service on or
         after the keyed date), and by procedure code.

2.       The contractor must develop a cross reference between PA's and all
         ICN's posted to the PA. Each on-line PA must display all ICN's posted
         and include a hot-key function for viewing individual claim records.

3.       The contractor must develop an effective means for adjusting used units
         or dollars as a result of claim adjustments or voided claims. The
         method used must also apply to any service-oriented tracking. This
         would also include any service tracking history. Adjustment ICNs must
         be posted to the PA file as stated in item 8.

4.       Claims shall reference the PA file and post at the detail level, making
         it possible for more than one prior authorization to be accessed per
         claim. This detail level posting must include a hot key function for
         viewing the individual authorization record.

5.       The on-line capability must include being able to scroll backwards
         within the PA file as well as forward.

6.       An audit trail/history must be provided for changes made to an existing
         prior authorization or reconsideration of a previously denied request.
         Any last date change indicator must include the date changed as well as
         a field identifier.

7.       Claims for services which may exceed the limitations of the accessed
         prior authorization must pay when appropriate based on the number of
         units/dollars remaining, posting an informational EOB to the claim .

8.       The prior authorization screen must display at a minimum: all current
         fields plus reviewer name/ID, current location ID, current location
         date, internal control numbers applied to the authorization,
         denial/approval reason code and description, date notice was mailed.

5.7.7.3    Claim attachments for some services may be required of multiple
           providers for the same service or of the same provider for an ongoing
           service, but currently must be submitted with each individual claim.
           To foster automation of this process and increase the number of
           claims that can be submitted electronically, the contractor shall be
           responsible for the development of an on-line attachment file as
           follows:

1.       Recipient-based attachment records must be created, at a minimum, for
         the following attachment types: Second Opinion, SURS-118 Referral,
         Sterilization Consent, Acknowledgment of Receipt of Hysterectomy,
         Medical Necessity, Medical Necessity for Abortion, Oxygen and
         Respiratory Equipment Medical Justification Form, and the Report of
         Hearing Aid Evaluation.

2.       Attachments must be numbered, scanned and keyed separately from
         individual claims. This excludes narrative type attachments which must
         continue to be scanned and processed with the claim.

3.       Claims and adjustments requiring an attachment must refer to the
         on-line attachment file for editing and processing, and must attempt a
         match on date, service, and signature criteria as specified by DMS.

4.       Claims not able to match specified criteria on a corresponding
         attachment must continue to recycle prior to final disposition for a
         time period as specified by DMS.

5.       The on-line attachment records must display all ICNs accessing the
         attachment with a hot key function for referring to the individual
         claim.

6.       The attachment file must be accessible from the individual claim as
         well as a separate claims inquiry menu option.

5.7.8    ENHANCEMENT 8 - Imaging/Workflow

The continuous growth of the Missouri Medicaid Program has created an
overwhelming need to enhance the current document management operations
performed within the Division of Medical Services (DMS). Document Management is
essential in the immediate development, organization, storage and retrieval of
documentation; promoting improved productivity and reduction in manpower and
material waste. Because the current imaging software has limited functionality
to meet the high demands for overall office productivity, an innovative system
is recommended to allow functions such as workflow, imaging, and storage
management to operate simultaneously. Stable off-the-shelf software will be
utilized whenever possible to achieve this refreshed document management system,
allowing the end users continued operations with Windows-based applications.

Currently, claim/attachment and prior authorization imaging is performed by the
contractor and stored on the contractor's computer. Unit imaging, achieved by
DMS staff, is restricted to the Provider Enrollment Unit; however, this
enhancement will introduce unit imaging to other areas within DMS.

An initial implementation of workflow capabilities will be targeted to
distinctive sections, as specified by DMS, with the option to phase in division
wide.

This new system must possess the operating functions of the current imaging
system and will require the following capabilities as outlined below:

5.7.8.1  Imaging - Scanning Functionality:

PARAGRAPH DELETED BY AMENDMENT #002:
1.       Deleted.

2.       The system must have the ability to scan single and multi-page
         documents and assemble one or more pages into documents and documents
         into batches.

3.       The system must have batch scanning capabilities with support for patch
         code readers and indexing.

4.       The system must allow scanned images to be indexed at the time of
         scanning or at a future time.

PARAGRAPH DELETED BY AMENDMENT #002:
5. Deleted.

PARAGRAPH DELETED BY AMENDMENT #002:
6.       Deleted.

7.       The system must be able to provide a count of the number of pages
         scanned to a single folder and a total count of the images produced on
         a daily basis. When the number of pages scanned is not correct, the
         system must provide a function to rescan those documents and
         incorporate where the user specifies.

8.       The system must furnish the ability to create "blank" pages online,
         allowing the user to record personal notations, etc., and incorporate
         these blank pages into single or multiple folders.

9.       The system must provide the capability to create personalized form
         letters, allowing the selection of pre-defined paragraphs, etc., and
         transfer these letters to specified folders.

10.      It must be possible to audit and monitor image quality by visually
         inspecting the images to determine if they should be accepted, marked
         for rescan or deleted.

11.      The system must provide an auto-adjust setting to create the most
         legible image on the first attempt, and must allow the capability to
         enhance and improve image legibility and skew before rescanning.
         Enhancement features must include the ability to remove black borders,
         shading, speckling and lines.

12.      The system must have the ability to rotate, de-skew, assemble and
         verify documents during the batch entry process.

13.      For claim related imaging, the system must have the ability to assign
         system generated sequential claim numbers on request. Claim numbers for
         scanned paper claims must follow the following 12 digit format:

o        Region Code (2 digits)
o        Year (2 digits)
o        Julian Date (3 digits)
o        Sequence Number (5 digits)

14.      The system must have the capability to dropout the boilerplate from
         "red" claims during the scanning process. This ability reduces the size
         of the image and can speed up the image retrieval process.

15.      The industry standard TIFF IV (Tagged Image File Format) must be used
         for image compression.

PARAGRAPH REVISED BY AMENDMENT #002:
16.       For the first three (3) years after this enhancement is implemented,
          the contractor will be required to provide and maintain up to five (5)
          new scanners which will be located at the DMS's offices. These
          scanners must be TWAIN compliant, flat-bed scanners with automatic
          document feed (ADF), simplex, andsupport up to 11" X 17" documents.
          Minimum rated scanning speed must be at least 30 pages per minute. The
          scanners will be utilized by DMS staff to achieve the unit imaging
          responsibilities. Beginning the fourth year after implementation, the
          contractor must purchase up to five (5) additional new scanners of
          equal or higher quality, and shall maintain and/or replace this
          equipment through the duration of the resulting contract.

5.7.8.2  Imaging - Indexing Functionality:

1.       The system must have the ability to index on specified document
         attributes, such as date received, provider number, PA number, etc.

2.       Users must be able to define alternate indices, including but not
         limited to ICN number, recipient identification number and provider ID,
         using a graphical point and click interface without programming or
         scripting.

3.       The system must provide users the ability to manually enter index
         values. In addition, the system must allow for the intelligent editing
         of index values during data entry. For example, edits should be in
         place for verifying field length, allowing numeric and/or alphabetic
         only. These edits should not require any programming or scripting.

4.       The system must support indexing of scanned batches during the scanning
         process and also as a separate process after scanning. The system
         should allow for additional index values to be added to a previously
         scanned and indexed image. In addition, it must be possible to scan an
         image with no initial index and to be able to specify the index value
         as null.

5.       The system must support the assignment of multiple indices, unique and
         non-unique. This allows documents to be retrieved based on various
         different search criteria.

6.       The system must have one or more configurable caches.

7.       The storage management system must be of open architecture, and data
         stored in the system must be accessible through CICS applications
         outside of the imaging system.

8.       Access to images must be controlled by a multi-level security profile.
         The system must be configurable to create access profiles that are
         automatically applied to documents based on their purpose and file
         type.

9.       DMS must have the ability to retrieve images based on a full or partial
         key search by key index. When a partial key search is used, all
         documents matching the search criteria should be returned in a
         selection list.

10.      The system must provide users the ability to create a "bookmark". The
         bookmark functions as a placeholder and allows users to quickly access
         any designated images.

11.      The system must be able to retrieve a batch of images as specified by
         the user.

12.      The system must allow user defined views, a capability commonly known
         as "foldering". The following foldering capabilities are required:

o             the ability to create new folders/sub-folders based upon
              pre-defined user indices. Folders would contain all documents
              associated with a specific index value, retrievable in a single
              request;
o        the capability to assign a single document to multiple folder views;
o        the capability for a folder to contain imaged and EDI documents; and
o        the  ability  to copy and paste  several  documents  at one time,
              including  images,  from one  folder to
              another.

5.7.8.3  Imaging - Image Display Functionality:

1.       Images must be displayable on DMS workstations. They must be full
         document images that are an exact replica of the original scanned
         paper. The boilerplate template must be displayed for "red" claims and
         the user must have the ability to scroll the template in order to
         ensure that it is positioned correctly.

2.       Zoom features must be available to enlarge or shrink images or a
         selected portion of images.

3.       The system must have the ability to scale, rotate and enhance
         documents.

4.       The system must allow for the zoom and clipboard copy of selected
         portions of document images.

5.       The system must allow clipboard copy of selected portions of images to
         be pasted into other desktop applications.

6.       The system must contain annotation features which support text, free
         form draw, stamp (i.e. approved, paid, etc.), sticky notes, color
         underlining and highlighting. Annotations should be stored separately
         from the image to protect it from modifications by the users.

7.       The system must allow the viewing and modification of annotations and
         must provide a feature to control viewing of these annotations by
         security profile.

8.       DSS staff must be able to retrieve and display in an average of thirty
         (30) seconds or less the first page of an imaged document that is less
         than three (3) years old. Each subsequent page of the same document
         must be displayed in one (1) second or less.

9.       Documents that have been stored as images for more than three (3) years
         must be  accessible  to DMS
         within four (4) hours.

5.7.8.4  Imaging - Printing Functionality:

1.       The system must allow DMS the ability to select print options and print
         the requested images on location.

2.       The system must be able to produce a high quality/high resolution print
         of the originally scanned document.

3.       The system must be able to print a batch of images that have been
         retrieved.

4.       The system must be able to print images in the same orientation in
         which they were scanned. For example, an image scanned in portrait mode
         should print in a portrait orientation.

5.       The system must be able to print the primary index value on the image
         document when printed.

5.7.8.5  Imaging - Provision of Access to Old Images:

1.       The contractor must provide the ability to read current images owned by
         DMS and stored on the Cirrus imaging system. As of July, 1998, it was
         estimated that approximately 35.9 million claim images (including
         attachments, Prior Authorizations and Nursing Home forms), 1.6 million
         Provider Enrollment images and a specified number of images of
         recipient correspondence were stored.

5.7.8.6  Imaging - Rollout of New System to Existing Image Enabled Areas:

1.       The contractor must scan new claims and assign an ICN number during the
         scanning process. As of July, 1998, an estimated daily volume of 17,000
         new paper claims was received by the current fiscal agent, with
         approximately 20% of these claims having attachments to be scanned.

2.       The contractor must provide DMS with indexing software to index
         provider enrollment images according to the desired criteria. The
         current Cirrus system requires the primary index number of provider ID
         to be assigned during the scanning process. The software associated
         with the new imaging system should allow scanning and indexing to occur
         separately. This should streamline the scanning and indexing process.

3.       The contractor must provide current Cirrus imaging users access to all
         previously scanned and newly scanned images.

5.7.8.7  Imaging - Rollout of New System to Other Areas:

1.       The contractor must provide the ability to roll out imaging in other
         areas within DMS. On an ongoing basis, DMS must be able to add document
         images to these databases as new files are generated or as changes or
         additions are made to the existing files. The contractor must provide
         image retrieval access to all users in these areas.

5.7.8.8  Workflow - Functionality:

1.       A workflow environment shall be created for use by the Division of
         Medical Services with the functionality to create/extract data
         systematically and automate/monitor distribution of work items (i.e.,
         documents, images, attachments, tasks) to user locations. This workflow
         software must assume, but not be restricted to, the following
         capabilities as outlined below:
o        must allow  creation/storage/retrieval,  through  security  access,  of
              correspondence  delivered  to and
              produced within DMS;
o        must provide a tracking  mechanism to enable  monitoring  the status of
              pending/completed  assignments to
              individual/ multiple users;
o             must assure a statistical/audit feature to report tracking of
              average time spent at each routing step, re-routing and total
              processing statistics; and
o        must be integrated with the existing or comparable electronic mail
              system currently utilized by the DMS.

5.7.8.9  Workflow - Rollout to Other Areas:

1.       An initial workflow system will be developed for targeted areas within
         DMS. The contractor must provide the ability to roll out workflow
         capability to other areas upon DMS notification.

2.       The contractor must provide a workflow expert to provide consultation
         when this requirement is developed and implemented in specified areas
         as recommended by DMS.

3.       The contractor will be required to provide training equipment and
         services to DMS users at the time of implementation.

5.7.9    ENHANCEMENT 9 - Surveillance and Utilization Review Subsystem

The SUR subsystem was enhanced during the current contract period, however
additional modifications are needed to make the system a more useful tool and
provide additional reporting.

5.7.9.1    The contractor shall perform the system modifications necessary to
           include MC+ information in the SURS data files. This will include
           encounter data, provider demographics by plan and provider network,
           recipient health plan and provider network files.

5.7.9.2    The contractor shall perform the system modifications necessary to
           expand the SURS data base to include three years of history. The
           system currently includes eighteen months of history.

5.7.9.3    The contractor shall provide a method to allow the selection rules
           for SURS Quarterly, Claim Detail and Audit Management reports to
           perform claim to claim comparisons. This should include the
           capability to compare selection of one set of criteria and then
           further selection by claim to claim, provider to provider, etc.
           (Examples - select all deliveries if there had been a global service
           billed within a six month range; select all presriptions with four
           (4) or more refills; select all recipients who had more than one well
           health screen within a year.)

5.7.9.4    The contractor shall add a Provider Summary Report to the Claim
           Detail and Audit Management reports. At a minimum, the summary must
           include provider totals by procedure code, code description,
           patients, services, quantity, billed amount, Medicaid allowable
           amount, amount paid and by diagnoses, code description with same
           fields as for procedure code.

5.7.9.5    The contractor shall review the formats of the Claim Detail and Audit
           Management reports for revisions, additions and possible additional
           report formats. To be included, at a minimum, is the addition of
           recipient name for each ICN, total number of claims, recipient's date
           of birth, and procedure code pulled to the audit report when the
           provider bills on a UB-92. A flexible report writer option in SURS
           (along with standard formats) or optional fields to add/title would
           also be acceptable.

5.7.9.6    The contractor shall make the necessary changes to the Exception
           Review Index to allow for a search by provider number or recipient
           DCN.

5.7.9.7    The contractor shall review data elements as to specifications and
           update accordingly. The contractor shall also review selection
           criteria and format for the Summary of Medical, ER and Prescriptions.

5.7.9.8    The contractor shall review the entire format of the Recipient
           Explanation of Medical Benefits. This would include reviewing the
           layout, wording, selection and procedure code selection/definitions
           and make recommendations.

5.7.9.9    The contractor shall create a report to be used for the Certificate
           of Need program. This report will be used by Medical Review Services
           (MRS) to request medical records for certification of need review and
           will be produced on a monthly basis using criteria specified by DMS
           using paid claims only. Claims selected will be from facilities in
           the inpatient psychiatric parameters who have a provider type of 01,
           02 or 05. Provide the ability to select a specified number of claims
           per provider or universe each month. Options needed for these claims
           are flexibility with sample size or the ability to specify a
           different percent for each provider.

5.7.9.10   The contractor shall provide a method to ensure that as new programs
           are implemented in the State Medicaid program, they will be included
           in a SURS category of service (existing or new as determined by SURS
           Unit).

5.7.9.11   The contractor shall review the capabilities of the Audit Management
           screens and make recommendations for use and implement as determined
           by SURS Unit.

5.7.9.12   The contractor shall provide a method in the MMIS to edit for
           provider services when billing procedure codes with minute/hour
           rates. A specific list of procedure codes will be provided by DMS.
           The system shall accumulate and count the minutes/hours billed and
           suspend claims that exceed 24 hours per day maximum. A report of
           these services must be created and distributed to the SURS Unit for
           follow-up.

5.7.10   ENHANCEMENT 10 - Third Party Liability Case Management System

DMS wishes to develop and implement a comprehensive third party liability case
management system to eliminate the use of multiple software databases, multiple
subsystems and multiple contractors to handle various portions of the recovery
process. This system shall encompass a billing, tracking, and payment mechanism
which integrates with the accounts receivable system to provide for (1) Medicare
Buy-In payment processing, recovery and cost avoidance; (2) health insurance
recovery and cost avoidance; (3) trauma and estate recovery; (4) health
insurance premium payment (HIPP) processing; and (5) personal funds and burial
plan recovery. The following are the requirements of the Third Party Liability
Case Management Subsystem (TPLCMS).

5.7.10.1 Recipient TPL Policy Databases:

1.       The contractor must restructure and maintain the current recipient TPL
         policy databases, which include recipient policy data, insurance
         company data, employer data, and TPL lead data.

 a.      The policy database will contain recipient specific and policy data.
         This information will be used to cost avoid claims and to recover
         health insurance payments from liable companies.

 b.      The insurance company database will contain information necessary for
         providers to pursue the third party and for DMS recovery purposes. It
         will contain billing criteria and company data, and must be capable of
         maintaining multiple records per company.

 c.      The employer database must have multiple health plans for each employer
         and will be used to update policy data and coverage. The address fields
         will be used to generate system letters to update group information.


<PAGE>



PARAGRAPH REVISED BY AMENDMENT # 002:
2.       Daily activities necessary to maintain information within these
         databases shall include, but not be limited to, batch updates, audit
         trails, and search and edit capabilities by user-specified criteria.

3.       The contractor shall initiate scheduled system purges within the TPLCMS
         as defined by DMS.

4.       The contractor shall create a logging system that tracks correspondence
         and phone calls received from recipients, insurance companies,
         employers, and providers. The log will contain recipient and policy
         information and will reside within the recipient TPL policy files.

5.7.10.2 Third Party Liability Case Management Subsystem (TPLCMS):

1.       The contractor must incorporate all existing software database
         information into the MMIS TPLCMS by creating a tracking system that is
         accessible through the recipient subsystem and allows for interfacing
         between databases. The existing databases are as follows:

 a.      Personal Injury Log contains a large amount of information that is used
         by the Trauma Recovery section of TPL to track all trauma cases by type
         of recovery (i.e. Casualty/Tort, Worker's Comp, malpractice, Stars,
         etc.). Cases are tracked from identification to settlement. Case
         information includes, but is not limited to, date identified by TPL,
         current status of case (pending, settled, etc.), date of last action,
         current lien amount and amount recovered.

 b.      Correspondence Logs are used to track correspondence that is received
         by various programs. Information tracked includes, but is not limited
         to, date received, source of correspondence, the date and action taken
         by the assigned staff member.

 c.      Death Match Log is a table that tracks death matches received from the
         Department of Health/Vital Statistics. The log tracks an enormous
         amount of information. Some of the information includes, but is not
         limited to, decreased recipient name and DCN, date of birth, date of
         death, death certificate number, status of the estate, type of estate,
         real/personal property, date claim filed with court, amount filed,
         amount recovered, etc. All estate recovery, personal funds, and burial
         plan recoveries are tracked on the death match log.

 d.      Hearing Logs track the court hearings for trauma and estate recovery
         programs. The information traced on this log includes the recipient's
         name, DCN, hearing date, staff assignment, location of hearing, etc.
         and shows time and travel involved in hearings.

 e.      Case Notes Log is used to record activity on each HIPP case in lieu of
         keeping records in the file. It contains limited recipient,
         policyholder and policy information with an unlimited comment field for
         notes.

2.       The contractor shall develop procedures to process electronic data
         matches with commercial insurance carriers and government programs to
         obtain and update third party resources to identify trauma and estate
         recovery cases.

3.       The contractor shall establish interfaces with the Division of Data
         Processing as determined by DMS.

4.       The contractor shall allow for the ability to pay insurance and
         Medicare HMO copays and deductibles through the claims processing
         system.

5.       The contractor shall ensure that the TPLCMS generates from a recipient
         header record which may include more than one of the TPL project cases.

6.       The contractor shall create a summary list that displays all cases
         within the recipient header record and shall include user access to any
         case information from this summary.

7.       The contractor shall create hot key functionality within the databases
         and establish system generated tasks or functions based on the project
         task as designated by DMS.

8.       The contractor shall create an on-line tickler system that will serve
         as a tracking and reporting mechanism to inform staff when follow-up
         actions are needed.

9.       The contractor shall create an area to log and track correspondence and
         phone calls related to each case file. This logging system is separate
         from the logging system that will reside within the recipient TPL
         policy databases.

10.      The contractor will ensure that the TPL and Medicare subsystems create
         statements as claims and/or liens for billing and allow staff
         intervention, after automatic update with paid claims cycles, to
         deselect items on the statement. The current subsystem data must flow
         into recipient "case" records. The billing statement file would also
         create accounts receivable records which, when updated with payment
         data, would also update recipient "case" records. Data Processing
         Buy-In and HIPP payment data for open cases will be required to update
         the billing statement.

11.      The contractor will ensure that printed billing statements, facsimile
         claims, and recipient history reports are generated upon request.
         Automated form letters for each case type, with manual intervention and
         the ability to make changes to preset form letters, must be allowed.

12.      The contractor will ensure the ability for TPL staff to choose
         electronic or paper billing methods to insurance companies for
         retroactive billings according to the carrier's timely filing
         limitations and claim filing requirements. Staff must also have the
         ability to choose electronic or paper billing methods for each case
         with accumulated fee-for-service and encounter data.

13.      The ability to interface with Medicare's national standard format (NSF)
         is necessary to obtain and cross-reference diagnosis and procedure
         codes for Medicare crossover claims.

14.      The contractor will ensure that the system accepts adjusted Medicare
         claims from carriers and intermediaries and match to crossover claims
         that apply to the adjustments paid by Medicaid and report these for
         recovery.

15.      The contractor will maintain a crosswalk of Medicaid NDCs and Medicare
         HCPCS codes for use in drug billings.

16.      The contractor must provide the capability to process electronic
         remittance advices to update accounts receivable records and case
         management data. Rejected claims must be reported with standard denial
         codes for research and determination of follow-up action by DMS staff.

17.      The contractor will ensure that the system provides a reporting
         mechanism of claims with no responses received by insurance companies
         in an aged format determined by DMS. Each claim must accept multiple
         payment and denial updates. Claim payments/denials must show each
         source and the amount applied for reports defined by DMS. Criteria
         established by DMS will determine an automatic void of claim history
         records.

18.      The contractor will ensure the ability to create estate recovery case
         records and identify and accumulate paid claims when the recipient's
         date of death is received.

19.      Hearing dates and documentation must be tracked on all case records
         with automatic on-line notification of necessary actions.

20.      The contractor will establish automated trauma recovery capabilities to
         accumulate and update both fee-for-service and encounter claims data.

 a.      TPL-2 accident questionnaires would be systematically generated,
         tracked, followed up and reported. Responses to these questionnaires
         indicate a case record creation.

 b.      Paid items would automatically accumulate based on trauma and accident
         indicators or by selected criteria until the DMS threshold has been met
         or exceeded. If the threshold is not met in a prescribed time period,
         the statement would be deleted and the recipient case record closed
         automatically.

21.      The contractor will ensure the ability to enter selection criteria
         on-line to identify paid claims and encounters for a specific case in
         situations deemed as exceptional events by DMS.

5.7.10.3  Health Insurance Premium Payment (HIPP) Program:

1.       The contractor will provide and maintain a HIPP data system with
         on-line inquiry and update capability. This system will be used to
         track HIPP applications from date of receipt through completion of
         processing. System will interface with eligibility file and claims data
         to determine cost-effectiveness of policies and allow for payment
         processing of premiums, co-pays and reimbursement. Must interface with
         TPLCMS system for identification of HIPP participation and premium
         payment made.

6.       PROJECT ASSESSMENT QUOTATIONS

6.1        Project Assessment Quotations: In circumstances where the agency has
           a large or complex project for the contractor to complete, the
           contractor shall agree and understand the agency may alternatively
           elect to employ the Project Assessment Quotation (PAQ) as a means (1)
           to identify the specific tasks to be performed and (2) to mutually
           agree upon the total price to be paid to the contractor upon
           completion of the specified tasks. The PAQ process, if utilized by
           the agency, shall occur in a controlled sequence of proposals and
           approvals by the agency's designated Project Director as outlined
           below. Therefore, the contractor shall understand and agree that the
           general protocol for this workflow shall be as described below:

6.1.1    STEP 1:  PAQ REQUEST
           The agency's designated Project Director will present a written
           request for each PAQ to the contractor, in a standard format similar
           to the attached Request for Project Assessment Quotation. The
           agency's request must explain in detail the scope of the project and
           the tasks the agency desires the contractor to perform, including
           applicable business and technical specifications.

6.1.2    STEP 2:  DRAFT PAQ
           The contractor must respond to each such PAQ request from the
           agency's designated Project Director with a draft PAQ which provides
           a statement of cost (based upon the hourly/daily rates specified on
           the pricing pages) and time, technical and strategic alternatives,
           and solution recommendations.

6.1.3    STEP 3:  APPROVAL OF DRAFT PAQ
           If the draft PAQ is approved by the agency's designated Project
           Director, the contractor must then prepare a final PAQ for
           resubmission to the agency's designated Project Director for final
           approval.

6.1.4    STEP 4:  FINAL PAQ
           The contractor's final PAQ must include:
o        contract number;
o        state agency name/address
o        state agency designated project director name and phone number
o        contractor contact name and phone number
o        brief title of specific PAQ
o        final PAQ issue date
o        a detailed itemization and description of all of the project tasks
               which shall be completed by the
               contractor;
o              a firm, fixed total number of project hours for contractor
               personnel and the firm, fixed cost (based upon the hourly/daily
               rates specified on the pricing pages)
o        detailed completion schedule for each task/component of the project
               work;
o              mutually agreed upon turnaround times for the agency's designated
               Project Director to review, approve and formally accept or reject
               the components of the contractor's project work in accordance
               with the approved final PAQ;
o mutually agreed upon milestones for compensation of project costs for the
contractor's project work; o identification of the specific tasks within each
component of the PAQ which must be completed by state
               agency personnel;
o        signature and date lines for both the contractor and the agency's
               designated Project Director to signify
               approval.

6.1.5    STEP 5:  APPROVAL OF FINAL PAQ
           The contractor and the agency's designated Project Director must
           indicate mutual acceptance of the final PAQ by signing and dating the
           final PAQ. The agency's designated Project Director (1) must retain
           one signed copy; (2) must forward the original to the Division of
           Purchasing and Materials Management for inclusion in the contract
           file and (3) must send one copy to the contractor.

6.1.6    STEP 6:  AUTHORIZATION TO PROCEED/ PAQ PROJECT WORK
           An approved final PAQ alone does not constitute an authorization to
           proceed with project work. Before proceeding with project work, the
           contractor must receive a properly authorized SAM-553 (Contract
           Release Order) form except the state agency may authorize an
           obligation of less than $25,000 pursuant to the terms of the contract
           without the official encumbrance of funds. Project work shall include
           the contractor's completion of the final PAQ request.

6.1.7    STEP 7:  FORMAL ACCEPTANCE
           Upon the completion of all project work of a given PAQ, the
           contractor must notify the agency's designated Project Director in
           writing and shall submit an invoice in accordance with the PAQ
           approved by the agency's designated Project Director. The agency's
           designated Project Director shall review, approve and formally accept
           or reject the components of the PAQ project work in accordance with
           the turnaround time outlined in the PAQ. Formal acceptance shall not
           be unreasonable delayed or withheld by the state.

6.1.8    STEP 8:  COST RECOVERY FOR CONTRACTOR
           Project costs for the PAQ project work shall be reimbursable upon
           formal acceptance by the agency's designated Project Director in
           accordance with the milestones for compensation outlined in the PAQ.

6.1.9    GENERAL REQUIREMENTS

6.1.9.1 The contractor shall submit draft and final PAQs in a timely manner.

6.1.9.2    The agency's designated Project Director reserves the right to reject
           any contractor-submitted PAQ, request the contractor to submit a
           revised PAQ with adjustments (revised cost, length of time, solution
           recommendation, etc.), solicit a PAQ from the secondary contractor,
           or rebid for services through a separate competitive procurement.

6.1.9.3  The contractor shall not be paid for the preparation of the PAQ.

6.1.9.4    The contractor should provide a percentage discount to be applied to
           the contractor's hourly rates for projects/tasks that are of a
           three-month or greater duration.

6.1.9.5    A PAQ request, the draft and final PAQs, and the contractor's project
           work must be within the overall intent of the contract.

6.1.9.6    Any changes to the PAQ must be formalized in writing as an official
           revision to the final PAQ. The format of PAQ revisions shall be
           consistent with the format of the final PAQ as outlined above,
           including the distribution of the original to the Division of
           Purchasing and Materials Management, a copy to the contractor and
           retaining a copy for the agency's designated Project Director.

6.1.9.7    The agency's designated Project Director shall have the right to
           terminate the PAQ at any time, for the convenience of the agency,
           without penalty or recourse, by giving written notice to the
           contractor at least five (5) calendar days prior to the effective
           date of such termination. In the event of termination pursuant to
           this paragraph, all documents, data, reports, and accomplishments
           prepared, furnished or completed by the contractor pursuant to the
           terms of the contract shall, at the option of the agency's designated
           Project Director become the property of the State of Missouri. The
           contractor shall be entitled to receive just and equitable
           compensation for that work completed pursuant to the contract prior
           to the effective date of termination.

7.       CONTRACTUAL REQUIREMENTS

7.1      CONTRACT PERIOD:

PARAGRAPH REVISED BY AMENDMENT # 002:
7.1.1      The original contract period shall be as stated in the Request for
           Proposal (RFP). The contract shall not bind, nor purport to bind, the
           state for any contractual commitment in excess of the original
           contract period. The Division of Purchasing and Materials Management
           shall have the right, at its sole option, to renew the contract for
           two (2) additional one-year periods, or any portion thereof. In the
           event the Division of Purchasing and Materials Management exercises
           such right, all terms and conditions, requirements and specifications
           of the contract shall remain the same and apply during the renewal
           period, pursuant to applicable option clauses of this document.

7.2      PRICE:

7.2.1     All prices shall be as indicated on the Pricing Page. The state shall
          not pay nor be liable for any other additional costs including but not
          limited to taxes, shipping charges, insurance, interest, penalties,
          termination payments, attorney fees, liquidated damages, etc. The
          contractor shall be paid installation costs and/or maintenance/repair
          costs provided that such costs are firm, fixed and specifically
          proposed in response to the Request for Proposal. Failure to propose
          costs for installation and maintenance/repair shall not relieve the
          contractor from his/her responsibility to maintain, install and/or
          repair all items, and any related costs for the service shall be
          considered by both the contractor and the state to be included within
          the price stated in the contract.

7.3      CONTRACTOR LIABILITY:

7.3.1      The contractor shall be responsible for any and all injury or damage
           as a result of the contractor's negligence involving any equipment or
           service provided under the terms and


<PAGE>


           conditions, requirements and specifications of the contract. In
           addition to the liability imposed upon the contractor on account of
           personal injury, bodily injury (including death), or property damage
           suffered as a result of the contractor's negligence, the contractor
           assumes the obligation to save the State of Missouri, including its
           agencies, employees, and assigns, from every expense, liability, or
           payment arising out of such negligent act. The contractor also agrees
           to hold the State of Missouri, including its agencies, employees, and
           assigns, harmless for any negligent act or omission committed by any
           subcontractor or other person employed by or under the supervision of
           the contractor under the terms of the contract.

7.3.2      However, the contractor shall not be responsible for any injury or
           damage occurring as a result of any negligent act or omission
           committed by the State of Missouri, including its agencies,
           employees, and assigns.

7.4      FORCE MAJEURE:

7.4.1      The contractor shall not be liable for any excess costs for delayed
           delivery of goods or services to the State of Missouri, if the
           failure to perform the contract arises out of causes beyond the
           control of, and without the fault or negligence of the contractor.
           Such causes may include, however are not restricted to: acts of God,
           fires, floods, epidemics, quarantine restrictions, strikes, and
           freight embargoes. In all cases, the failure to perform must be
           beyond the control of, and without the fault or negligence of, either
           the contractor or any subcontractor(s). The contractor shall take all
           possible steps to recover from any such occurrences.

7.5      TERMINATION:

7.5.1     The Division of Purchasing and Materials Management reserves the right
          to terminate the contract at any time, for the convenience of the
          State of Missouri, without penalty or recourse, by giving written
          notice to the contractor at least thirty (30) calendar days prior to
          the effective date of such termination. In the event of termination
          pursuant to this paragraph, all documents, data, reports, supplies,
          equipment, and accomplishments prepared, furnished or completed by the
          contractor pursuant to the terms of the contract shall, at the option
          of the Division of Purchasing and Materials Management, become the
          property of the State of Missouri. The contractor shall be entitled to
          receive just and equitable compensation for services and/or supplies
          delivered to and accepted by the State of Missouri pursuant to the
          contract prior to the effective date of termination.

7.6      SUBCONTRACTORS:

7.6.1     Any subcontracts for the products/services described herein must
          include appropriate provisions and contractual obligations to ensure
          the successful fulfillment of all contractual obligations agreed to by
          the contractor and the State of Missouri and to ensure that the State
          of Missouri is indemnified, saved, and held harmless from and against
          any and all claims of damage, loss, and cost (including attorney fees)
          of any kind related to a subcontract in those matters described in the
          contract between the State of Missouri and the contractor. The
          contractor shall expressly understand and agree that he/she shall
          assume and be solely responsible for all legal and financial
          responsibilities related to the execution of a subcontract. The
          contractor shall agree and understand that utilization of a
          subcontractor to provide any of the products/services in the contract
          shall in no way relieve the contractor of the responsibility for
          providing the products/services as described and set forth herein. The
          contractor must obtain the approval of the State of Missouri prior to
          establishing any new subcontracting arrangements and before changing
          any subcontractors.

7.7      MBE/WBE PARTICIPATION:

7.7.1      The contractor must comply with the MBE/WBE participation levels
           committed to in the contractor's original proposal and must insure
           that any MBE/WBE participants become certified prior to June 30,
           1999.

7.7.2      The contractor shall prepare and submit to the Division of Purchasing
           and Materials Management periodic reports detailing all payments to
           MBE/WBEs participating in the contract. The report must include
           MBE/WBE payments for the reporting period. The report shall be
           submitted on a monthly basis unless otherwise determined by the
           Division of Purchasing and Materials Management.

7.7.3     The Division of Purchasing and Materials Management and the Office of
          Equal Opportunity will monitor the contractor's compliance in meeting
          the MBE/WBE participation levels committed to in the contractor's
          original proposal. If the contractor's payments to participating
          MBE/WBEs are less than the amount committed to in the contract, the
          state may cancel the contract, suspend or debar the contractor from
          participating in future state procurements, or retain payments to the
          contractor in an amount equal to the value of the MBE/WBE
          participation commitment less actual payments made by the contractor
          to MBE/WBEs. If the Division of Purchasing and Materials Management
          determines that the contractor is in compliance with the MBE/WBE
          participation commitment, the state will release the retained funds.

7.7.4     If a participating MBE/WBE does not become certified by June 30, 1999
          or if a participating MBE/WBE is unable to satisfactorily perform, the
          contractor must obtain other certified MBE/WBEs to fulfill the MBE/WBE
          participation requirements committed to in the contractor's original
          proposal. The contractor must obtain the written approval of the
          Division of Purchasing and Materials Management for any new MBE/WBE
          participants. If the contractor cannot obtain a MBE/WBE replacement,
          the contractor must submit an Application for Waiver to the Division
          of Purchasing and Materials Management documenting all efforts made to
          secure an MBE/WBE replacement. The Division of Purchasing and
          Materials Management shall have sole discretion in determining if the
          actions taken by the contractor constitute a good faith effort to
          secure the participation of MBE/WBEs and whether the contract will be
          amended to change the MBE/WBE participation commitment.

7.8      PERFORMANCE SECURITY DEPOSIT:

PARAGRAPH REVISED BY AMENDMENT # 002:
7.8.1     The contractor must furnish a performance security deposit in the form
          of an original bond issued by a surety company authorized to do
          business in the State of Missouri (no copy or facsimile is
          acceptable), check, cash, bank draft, or irrevocable letter of credit
          to the Office of Administration, Division of Purchasing and Materials
          Management within thirty (30) days after award of the contract and
          prior to performance of service under the contract or any installation
          of equipment. The performance security deposit must be made payable to
          the State of Missouri in the amount of one million dollars
          ($1,000,000.00). The contract number and contract period must be
          specified on the performance security deposit. In the event the
          Division of Purchasing and Materials Management exercises an option to
          renew the contract for an additional period, the contractor shall
          maintain the validity and enforcement of the security deposit for the
          said period, pursuant to the provisions of this paragraph, in an
          amount stipulated at the time of contract renewal, not to exceed
          $1,000,000.00.

7.9      INVENTIONS, PATENTS, AND COPYRIGHTS:

7.9.1      The contractor shall report to the state promptly and in reasonable
           written detail, each notice or claim of patent or copyright
           infringement based on the performance of the contract of which the
           contractor has knowledge.

7.9.2     The state agrees that the contractor has the right to defend or at its
          option to settle, and the contractor agrees to defend at its own
          expense or at its option to settle, any claim, suit or proceeding
          brought against the state on the issue of infringement of any United
          States patent or copyright by any product, or any part thereof,
          supplied by the contractor to the state under this agreement. The
          contractor agrees to pay, subject to the limitations hereinafter set
          forth in this paragraph, any final judgment entered against the state
          on such issue in any suit or proceeding defended by the contractor.
          The state agrees that the contractor at its sole option shall be
          relieved of the foregoing obligations unless the state notifies the
          contractor promptly in writing of any such claim, suit, or proceeding,
          and at the contractor's expense, gives the contractor proper and full
          information needed to settle and/or to defend any such claim, suit, or
          proceeding. If the product, or any part thereof, furnished by the
          contractor to the state becomes, or in the opinion of the contractor
          may become, the subject of any claim, suit, or proceeding for
          infringement of any United States patent or copyright, or in the event
          of any adjudication that such product or part infringes any United
          States patent or copyright, or if the use, lease, or sale of such
          product or part is enjoined, the contractor may, at its option and its
          expense: (1) procure for the state the right under such patent or
          copyright to use, lease, or sell as appropriate such product or part,
          or (2) replace such product or part with other product or part
          suitable to the state, or (3) suitably modify such product or part, or
          (4) discontinue the use of such product or part and refund the
          aggregated payments and transportation costs paid therefore by the
          state, less a reasonable sum for use and damage. The contractor shall
          have no liability for any infringement based upon: (1) the combination
          of such product or part with any other product or part not furnished
          to the state by the contractor, or (2) the modification of such
          product or part unless such modification was made by the contractor,
          or (3) the use of such product or part in manner for which it was not
          designed.

7.9.3      The contractor shall not be liable for any cost, expense, or
           compromise, incurred or made by the state in conjunction with any
           issue of infringement without the contractor's prior written
           authorization. The foregoing defines the entire warranty by the
           contractor and the exclusive remedy of the state with respect to any
           alleged patent infringement by such product or part.

7.10     INSURANCE:

7.10.1     The contractor shall understand and agree that the State of Missouri
           cannot save and hold harmless and/or indemnify the contractor or
           employees against any liability incurred or arising as a result of
           any activity of the contractor or any activity of the contractor's
           employees related to the contractor's performance under the contract.

7.10.2    Therefore, the contractor must acquire and maintain adequate liability
          insurance in the form(s) and amount(s) sufficient to protect the State
          of Missouri, its agencies, its employees, its clients, and the general
          public against any such loss, damage and/or expense related to his/her
          performance under the contract. The insurance coverage shall include
          general liability and appropriate professional liability. Written
          evidence of the insurance shall be provided by the contractor to the
          state agency. The evidence of insurance shall include, but shall not
          necessarily be limited to: effective dates of coverage, limits of
          liability, insurer's names, policy numbers, endorsement by
          representatives of the insurance company, etc. Evidence of
          self-insurance coverage or of another alternative risk financing
          mechanism may be utilized provided that such coverage is verifiable
          and irrevocably reliable. The evidence of insurance coverage must be
          submitted before or upon award of the contract. In the event the
          insurance coverage is canceled, the state agency must be notified
          immediately.

7.11     FEDERAL FUNDS REQUIREMENTS:

7.11.1    The contractor shall understand and agree that this procurement may
          involve the expenditure of federal funds. Therefore, pursuant to
          federal government requirements, all contracts, subcontracts, and
          subgrants of amounts in excess of $100,000 shall contain a provision
          which requires compliance with all applicable standards, orders, or
          requirements issued under Section 306 of the Clean Air Act (42 U.S.C.
          1857(h)), Section 508 of the Clean Water Act (33 U.S.C. 1368),
          Executive Order 11738, and Environmental Protection Agency regulations
          (40 CFR Part 15), which prohibit the use under non-exempt federal
          contracts, grants or loans of facilities included on the EPA list of
          Violating Facilities. The provision shall require reporting of
          violations to the grant or agency and to the U.S.E.P.A. Assistant
          Administrator for Enforcement (EN-329). Contractors shall recognize
          mandatory standards and policies relating to energy efficiency which
          are contained in the state energy conservation plan issued in
          compliance with the Energy Policy and Conservation Act (P.L. 94-163).

7.12     CONTRACTOR STATUS:

7.12.1     The contractor represents himself or herself to be an independent
           contractor offering such services to the general public and shall not
           represent himself/herself or his/her employees to be an employee of
           the State of Missouri. Therefore, the contractor shall assume all
           legal and financial responsibility for taxes, FICA, employee fringe
           benefits, workers compensation, employee insurance, minimum wage
           requirements, overtime, etc., and agrees to indemnify, save, and hold
           the State of Missouri, its officers, agents, and employees, harmless
           from and against, any and all loss; cost (including attorney fees);
           and damage of any kind related to such matters.

7.13     SUBSTITUTION OF PERSONNEL:

7.13.1    The contractor agrees and understands that the State of Missouri's
          agreement to the contract is predicated in part on the utilization of
          the specific individual(s) identified in the bid. Therefore, the
          contractor agrees that no substitution of such specific individual(s)
          and/or personnel qualifications shall be made without the prior
          written approval of the state agency. The contractor further agrees
          that any substitution made pursuant to this paragraph must be equal or
          better than originally proposed and that the state agency's approval
          of a substitution shall not be construed as an acceptance of the
          substitution's performance potential. The State of Missouri agrees
          that an approval of a substitution will not be unreasonably withheld.

7.14     YEAR 2000 PROVISIONS:

7.14.1     The contractor shall warrant that any products and services provided
           or sold to the state agency pursuant to the resulting contract are
           Year 2000 compliant. "Year 2000 compliance" or "Year 2000 compliant"
           shall refer to timely and accurate processing of date/time data from,
           into, and between the twentieth and twenty-first centuries, and the
           years 1999 and 2000, including leap year calculations.

7.14.2     The contractor is hereby advised that any interruption in the
           provision of products and services pursuant to the contract,
           including those resulting from Year 2000 compliance issues, shall
           constitute a breach of contract and that all remedies specified in
           the contract may be applied to such a breach of contract.

7.14.3     The contractor is advised to make its best efforts to ensure its
           internal business systems are also Year 2000 compliant.

7.15     FEDERAL/STATE LEGISLATION CHANGES:

7.15.1     The State of Missouri reserves the right to amend the contract to
           include negotiated scope of work changes, including pricing,
           necessitated by changes in applicable federal and/or state laws,
           regulations, policies and/or procedures that directly impact the MMIS
           program.

8.       OFFERORS INSTRUCTIONS AND REQUIREMENTS

8.1      OFFERORS' SUBMISSION OF PROPOSALS:

8.1.1      Proposals must be priced, signed, sealed, and returned (with all
           necessary attachments) to the Division of Purchasing by the closing
           date and time specified. Specifically, any form containing a
           signature line, such as the front page of the original RFP and any
           amendments, pricing pages, etc., must be manually signed and returned
           as part of the offeror's proposal.

8.1.2      The offeror should, in addition to the offeror's original proposal,
           submit nine (9) copies of his/her proposal, FOR A TOTAL OF TEN (10)
           complete proposal documents. The offeror is also requested to provide
           an electronic version of the response in either Microsoft Word or
           Adobe Acrobat PDF format.

8.1.3      The offeror must respond to this RFP by submitting all data required
           herein in order for his/her proposal to be evaluated and considered
           for award. Failure to submit such data shall be deemed sufficient
           cause for disqualification of a proposal from further consideration
           for award.

8.1.4      Proposals should be limited in length to four hundred (400) physical
           8 1/2 X 11 inch pages. Both sides may be utilized, giving an actual
           maximum of eight hundred (800) pages. Font size should be no smaller
           than that used in this RFP. Charts and graphs may be printed on
           larger sheets of paper as long as they are folded down to 8 1/2 X 11
           inch size. This limitation on proposal size in being requested to
           encourage offerors to succinctly address all requirements of the RFP
           with a minimal amount of marketing hyperbole.

8.1.5      To facilitate the evaluation process, the offeror is encouraged to
           organize his/her proposal into distinctive sections that correspond
           with the individual evaluation categories described herein. Each
           distinctive section should be titled with each individual evaluation
           category and all material related to that category should be included
           herein. The signed front page from the original RFP and all signed
           amendments should be placed at the beginning of the offeror's
           proposal.

8.1.6     Proposal Security Deposit Required: The offeror must furnish a
          proposal security deposit in the form of an original bond (copies or
          facsimiles shall not be acceptable), check, cash, bank draft, or
          irrevocable letter of credit to the Office of Administration, Division
          of Purchasing and Materials Management before the time is set of
          opening the proposals. The proposal security deposit must be made
          payable to the State of Missouri in the amount of $50,000.00. The
          Request for Proposal number must be specified on the proposal security
          deposit. Any proposal security deposit submitted shall remain in force
          until such time as the contractor submits a performance security
          deposit. Failure to submit a performance security deposit in the time
          specified or failure to accept award of the contract shall be deemed
          sufficient cause to forfeit the proposal security deposit.

8.2      COMPETITIVE NEGOTIATION OF PROPOSALS:

           The offeror is advised that under the provisions of this Request for
           Proposal, the Division of Purchasing and Materials Management
           reserves the right to conduct negotiations of the proposals received
           or to award a contract without negotiations. If such negotiations are
           conducted, the following conditions shall apply:

           Negotiations may be conducted in person, in writing, or by telephone.

           Negotiations will only be conducted with potentially acceptable
           proposals. The Division of Purchasing and Materials Management
           reserves the right to limit negotiations to those proposals which
           received the highest rankings during the initial evaluation phase.
           All offerors involved in the negotiation process will be invited to
           submit a best and final offer.

           Terms, conditions, prices, methodology, or other features of the
           offeror's proposal may be subject to negotiation and subsequent
           revision. As part of the negotiations, the offeror may be required to
           submit supporting financial, pricing and other data in order to allow
           a detailed evaluation of the feasibility, reasonableness, and
           acceptability of the proposal.

           The mandatory requirements of the Request for Proposal shall not be
           negotiable and shall remain unchanged unless the Division of
           Purchasing and Materials Management determines that a change in such
           requirements is in the best interest of the State of Missouri.

8.3      PROPOSAL EVALUATION/CONTRACT AWARD:

8.3.1      After determining that a proposal satisfies the mandatory
           requirements, the evaluator(s) shall use both objective and
           subjective judgment in conducting a comparative assessment of the
           relative benefits and deficiencies of the proposals in relationship
           to the published evaluation criteria stated below:

           Fixed Cost  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .    35%
           Variable Cost.  .  .  .  .  .  .  . .  .  .  .  .  .  .     5%
           Experience and Reliability .  .  .  .  .  .  .  .  .  .    10%
           Expertise of Personnel.   .  .  .  ..  .  .  .  .  .  .    15%
           Proposed Method of Performance .  .  . . . . .  .  .  .    35%

8.3.2      After an initial screening process, a technical question and answer
           conference or interview may be conducted, if deemed necessary by the
           Division of Purchasing, to clarify or verify the offeror's proposal
           and to develop a comprehensive assessment of the proposal. The
           offeror shall be solely responsible for any costs associated with
           attending such a conference.

8.3.3      The State of Missouri reserves the right to consider historic
           information and fact, whether gained from the offeror's proposal,
           question and answer conferences, references, or any other source, in
           the evaluation process.

8.3.4      The offeror is cautioned that it is the offeror's sole responsibility
           to submit information related to the evaluation categories and that
           the State of Missouri is under no obligation to solicit such
           information if it is not included with the offeror's proposal.
           Failure of the offeror to submit such information may cause an
           adverse impact on the evaluation of offeror's proposal.

8.4      COST:

8.4.1      The offeror must provide firm, fixed prices for all requirements as
           set forth in this Request for Proposal. All prices must be provided
           on the Enhancements and Scope of Work Pricing Schedule, Exhibit A,
           and on the Project Assessment Quotation Pricing Schedule, Exhibit B,
           of this RFP, as applicable. Both Exhibits must be completed, signed,
           and returned with the offeror's proposal.

8.4.1.1    The Fixed Cost evaluation will include objective evaluation of the
           fixed portions of the Exhibit A (i.e., the modification and operation
           costs of enhancements and the MMIS operation cost). The Variable Cost
           evaluation will include subjective evaluation of the adjustment
           portions of Exhibit A (Claim and Encounter Volume Adjustment and CPU
           Time for Ad-Hoc Requests) and all of Exhibit B.

8.4.2      Any cost and/or pricing data submitted or related to the offeror's
           proposal, including any cost and/or pricing data related to
           contractual renewal options, whether required or voluntary, shall be
           subject to evaluation if deemed in the best interests of the State of
           Missouri.

8.4.3      In the evaluation of the offeror's proposal, the Division of
           Purchasing and Materials Management reserves the right to consider
           the value of money and any other economic impact factors as deemed
           appropriate and in the best interests of the State of Missouri.

8.4.4      The evaluation of cost will include all mandatory requirements and
           will cover all renewal option periods. For evaluation purposes only,
           a total contract price will be computed based on the following:

(1)               The firm, fixed total system modification price for each
                  enhancement package.

(2)               The firm, fixed price per month for the operation of each
                  enhancement package multiplied by the actual number of months
                  each such enhancement package is required to be operational
                  based on the enhancement schedule set forth in the RFP.

PARAGRAPH REVISED BY AMENDMENT # 002:
(3)               The firm, fixed total base price for all services and
                  equipment required to operate the MMIS for the entire length
                  of the contract including renewal periods.

PARAGRAPH REVISED BY AMENDMENT # 002:
(4)               The firm, fixed additional price to be paid if claim volume is
                  higher than projected will be utilized in the evaluation of
                  cost for three (3) years of the contract. Claim volume 10%
                  higher than projected will be used for one (1) year; claim
                  volume 6.5% higher than projected will be used for one (1)
                  year; and claim volume 3% higher than projected will be used
                  for one (1) year.

PARAGRAPH REVISED BY AMENDMENT # 002:
(5)               The firm, fixed price to be credited if claim volume is lower
                  than projected will be utilized in the evaluation of cost for
                  three (3) years of the contract. Claim volume 8.5% lower than
                  projected will be used for one (1) year; claim volume 5% lower
                  than projected will be used for one (1) year; and claim volume
                  2.5% lower than projected will be used for one (1) year.

(6)               The firm, fixed price per CPU hour for CPU time in excess of
                  four hundred twenty (420) hours per state fiscal year for
                  adhoc requests multiplied by an estimated five (5) hours per
                  year.

8.5      OFFEROR'S EXPERIENCE AND RELIABILITY:

8.5.1      Experience and reliability of the offeror's organization is
           considered in the evaluation process. Therefore, the offeror is
           advised to submit any information that documents successful and
           reliable experience in past performances, especially those
           performances related to the requirements of this RFP.

8.5.2      The offeror should provide the following information related to
           previous and current contracts that are considered identical or
           similar to the requirements of this RFP.

(1)               Name, address and telephone number of contracting agency and a
                  contact person who may be contacted for verification of all
                  data submitted;

(2)               Date of the contract; and

(3)               A brief, written description of the specific prior services
                  performed and requirements thereof.

(4)      The above information may be shown on the form attached as Exhibit C to
          this RFP or in a similar manner.

8.6      EXPERTISE OF OFFEROR'S PERSONNEL:

8.6.1      The qualifications of the personnel proposed by the offeror to
           perform the requirements of this RFP will be considered in the
           evaluation. Therefore, the offeror should submit detailed information
           related to the experience and qualifications of the staff proposed.
           If personnel proposed for the takeover portion of the Scope of Work
           are different from those proposed for the operational portion, these
           differences MUST be identified in the offeror's proposal.

8.6.2      The offeror should provide a resume including references detailing
           education qualifications and previous work assignments as may relate
           to this RFP for key personnel to be assigned to the project. The key
           positions identified by the State are:

o        Account Manager
o        Systems Manager
o        Claims Manager
o        Support Services Manager
o        Network Administrator

8.6.3    If staff is not yet hired, the offeror should provide:

(1)               Detailed descriptions of the required employment
                  qualifications, and

(2)      Detailed job  descriptions of the position to be filled,  including the
                  type of individual  proposed to be
                  hired.

8.7      PROPOSED METHOD OF PERFORMANCE:

8.7.1      Proposals will be evaluated based on the offeror's distinctive plan
           for performing the requirements of this RFP. Since the evaluators
           have already read the Scope of Work as described in the RFP, it is
           not necessary for the offeror to repeat the exact RFP language, or to
           present a paraphrased version, as an original idea for a technical
           approach.

8.7.2      The offeror should present a written narrative that demonstrates the
           method of manner in which the offeror proposes to satisfy the
           requirements of the Scope of Work. The language of the narrative
           should be straightforward and limited to facts, solutions to
           problems, and plans of proposed action.

8.7.3      The method by which the proposed method of performance is written is
           left to the discretion of the offeror.

8.7.4      The offeror MUST provide a sequential step-by-step description of the
           tasks or events that are proposed to accomplish the scope of work and
           the number of hours required to perform the task or event. In
           addition, the offeror should specify the personnel who are proposed
           to perform each task and the number of work hours each person will be
           working on that particular event.

8.7.5      The offeror MUST outline a "Schedule of Events" or milestones and
           indicate the time requirements and key personnel associated with
           each. In the event of overlapping or concurrent tasks, the use of a
           graphic chart (PERT, bar, line, etc.) is also encouraged.

8.7.6      The offeror is advised that the personnel work hours proposed in the
           Schedule or Events may be reviewed for reasonableness. Furthermore,
           the assigned tasks may be compared with the qualifications of the
           personnel.

8.7.7      The offeror should provide organizational charts showing the staffing
           and lines of authority for the key personnel to be used in both the
           implementation and operational phases. The relationship of the
           project leader to management and to support personnel should be
           clearly illustrated.

8.7.8      The method of performance MUST include a detailed task-by-task work
           plan for the entire transfer and implementation process (including
           training of State of Missouri personnel and all conversion
           activities), and a schedule for the performance of each task. The
           schedule should allow adequate time for DMS approval of each
           deliverable. The description MUST address the following subjects:

(1)               Any assumptions or constraints identified by the offeror.

(2)      A breakdown of all  development  and  implementation  efforts into
                  subtasks (not to exceed 4 man-weeks of
                  effort each),

(3)               Man-weeks of effort for each subtask, showing contractor and
                  state personnel efforts separately,

(4)               A network diagram, showing the inter-relationships of all
                  subtasks and identifying the critical path,

(5)               A Gant-chart, showing the planned start and end dates of all
                  subtasks, and

(6)               A discussion of how the work plan provides for handling of
                  potential and actual problems.

8.7.9    The description of manual functions MUST cover:

(1)               Flowchart of all document handling (of both input and output)
                  from claims receipt to final disposition or report generation,

(2)               Descriptions of manual controls, and

(3)               Identification of any manual exceptions.

8.7.10     The method of performance MUST include details of the method to be
           used in managing the project, in controlling project activities, and
           reporting progress. This description MUST include:

(1) Project management approach,

(2) Project control tools,

(3) Staffing and time estimate methods,

(4) Reporting,

(5) Interface with the State,

(6) Recommended staffing for all MMIS related functions, and

(7) Identification of significant difference in processing of different claim
types.

8.7.11     The method of performance MUST describe the data processing system
           that will be used including the following:

(1) Design and programming methodology,

(2) Testing methodology,

(3) Documentation standards,

(4) Security and confidentiality,

(5) Data processing resource requirements for operation after being fully
implemented,

(6) Method of calculating data processing resource requirements, and

(7) Specific location of each item of equipment and details of any
telecommunications network involved.

8.8      ADDITIONAL INFORMATION AND DOCUMENTATION AVAILABLE:

8.8.1      Information in addition to the information presented herein and in
           the attachments to this RFP is available for review. Such information
           provides a more detailed description of Missouri's Medicaid program
           and current MMIS and includes the following:

o        Data processing standards of DSS/DDP
o        List of system generated reports
o        TPL Database Procedure Manual
o        Health Plan User Manual
o        System documentation and user manuals

8.8.2      Offerors may review this information in state offices located in
           Jefferson City, Missouri by contacting the buyer, Gary Eggen, at
           (573) 751-2497 to schedule an appointment.

8.9      PROPRIETARY PROPOSAL INFORMATION:

           In the event the offeror's proposal contains information which the
           offeror considers proprietary, the offeror should identify in the
           proposal those sections considered proprietary. NOTE: Such
           information cannot be kept confidential unless the proprietary pages
           are marked "Confidential" and those pages are sealed within the
           proposal. However, in accordance with the Open Records Law, RSMo
           610.021, the offeror may only seal and mark "Confidential" those
           pages which are documentation for the software code or which detail
           scientific and technological innovations in which the owner has a
           proprietary interest.


<PAGE>



       9. OFFEROR REQUIREMENTS FOR MINORITY BUSINESS ENTERPRISE (MBE) AND
          WOMEN BUSINESS ENTERPRISE (WBE) PARTICIPATION

  - - - - - READ ALL OF THIS PART OF THE RFP AND COMPLETE ALL BLANKS - - - - -

9.1      MANDATORY REQUIREMENT FOR PARTICIPATION:

In order for the Division of Purchasing and Materials Management to meet the
requirements of Executive Order 98-21, the offeror must secure participation by
MBEs and WBEs in providing the products/services required in this RFP. The
offeror must secure MBE participation of at least 20% and WBE participation of
at least 10% of the total dollar value of the contract. The MBE/WBE
participation requirements can be met by offerors qualifying as MBE/WBEs or
through the use of subcontractors, suppliers, joint ventures, or other
arrangements that afford meaningful opportunities for MBE/WBE participation.
Work performed by MBE/WBEs must provide a commercially useful function related
to the delivery of the service/product required herein.

9.2      MBE/WBE DEFINITION:

MBE or WBE means a business that is a sole proprietorship, partnership, joint
venture, or corporation in which at least fifty-one percent (51%) of the
ownership interest is held by minorities or women and the management and daily
business operations of which are controlled by one or more minorities or women
who own it. Minority is defined in RSMo 33.750 as belonging to one of the
following racial minority groups: African Americans, Native Americans, Hispanic
Americans, Asian Americans, or other similar racial groups.

9.3      OFFEROR'S QUALIFYING AS MBE/WBE:

MBE/WBEs submitting proposals can meet the MBE or WBE participation requirements
by completing the "Documentation of MBE/WBE Participation" form and verifying
their certification as an MBE or WBE or by affirming that they meet the
statutory definition of a MBE/WBE. Note: Portions of the contract that will be
performed by businesses which do not qualify as MBEs or WBEs will not be
considered as MBE/WBE participation.

9.4      POTENTIAL MBE/WBE SUBCONTRACTING AND OTHER PARTICIPATION OPPORTUNITIES:

This information is intended to suggest potential opportunities for
participation of MBEs and WBEs in providing the products and services required
in the RFP. Offerors can meet the participation requirements through the use of
subcontractors, suppliers, joint ventures, or other arrangements that afford
meaningful opportunities for MBE/WBE participation. The following list is not
meant to be all inclusive, nor is it intended to limit the offeror to utilize
the participation in the manner identified

o        Medicaid ID Card Production
o        Printing and Mailing Recipient Notices
o        Fax and Copy Machine Maintenance
o        Diesel Generator Maintenance
o        Contract Programmers
o        Mailing System and Letter Opener Maintenance
o        Paper Recycling


<PAGE>



9.5      RFP MAILING LIST:

The list of companies who were mailed a copy of this RFP may be used by MBE and
WBE companies or by potential offerors to identify companies where the
possibility of a potential subcontracting or participation relationship may
exist. A copy of the RFP mailing list is available on the Internet at:
http://www.oa.state.mo.us/purch/bids.htm.

However, because the mailing list is continually changing, it may not
necessarily include the names and addresses of all companies who have received
the RFP nor does it include the names of all potential offerors.

9.6      RESOURCES:

A listing of several resources that are available to assist offerors in their
efforts to identify and secure the participation of MBEs and WBEs in providing
the products/services required in this RFP are contained later in the
subparagraphs of this part of the RFP.

9.7      PARTICIPATION COMMITMENT:

THE OFFEROR MUST INDICATE BELOW THE PERCENTAGE OF MBE AND WBE PARTICIPATION
COMMITTED TO IN RELATION TO THE TOTAL DOLLAR VALUE OF THE INITIAL CONTRACT
PERIOD.

If the offeror qualifies as a MBE and/or a WBE, the offeror must include the
percentage of the contract value that the offeror will provide in the table.
<TABLE>
<CAPTION>
----------------------------------------- ----------------- --------------------------------------- ----------------
<S>                                       <C>               <C>                                     <C>
          NAME OF MBE                      PERCENTAGE OF                 NAME OF WBE                 PERCENTAGE OF
                                           CONTRACT VALUE                                           CONTRACT VALUE
----------------------------------------- ----------------- --------------------------------------- ----------------
----------------------------------------- ----------------- --------------------------------------- ----------------

----------------------------------------- ----------------- --------------------------------------- ----------------
----------------------------------------- ----------------- --------------------------------------- ----------------

----------------------------------------- ----------------- --------------------------------------- ----------------
----------------------------------------- ----------------- --------------------------------------- ----------------

----------------------------------------- ----------------- --------------------------------------- ----------------
----------------------------------------- ----------------- --------------------------------------- ----------------
Total MBE:                                                  Total WBE:
----------------------------------------- ----------------- --------------------------------------- ----------------
</TABLE>

9.8      DOCUMENTATION OF MBE/WBE PARTICIPATION:

The offeror must insure that each MBE and WBE listed in the preceding table
completes the "Documentation of MBE/WBE Participation" form included on the
following page of this part of the RFP. The percentage level of MBE/WBE
participation committed to by the offeror in the table above and verified in the
"Documentation of MBE/WBE Participation" form, shall be considered by the
Division of Purchasing and Materials Management in determining if the offeror
has satisfied the MBE/WBE participation requirements.

9.9      APPLICATION FOR WAIVER:

If the committed percentage of participation is less than 20% for MBE or less
than 10% for WBE, the offeror must complete the "Application for Waiver" form
documenting efforts made to meet the MBE/WBE participation requirements. The
"Application for Waiver" form can be found immediately following the
"Documentation of MBE/WBE Participation" form in this part of the RFP.


<PAGE>



9.10     REJECTION OF PROPOSAL:

Failure of the offeror to obtain 20% MBE participation and 10% WBE participation
shall result in rejection of the proposal unless the "Application for Waiver"
form is submitted with the proposal by the offeror and approved by the Division
of Purchasing and Materials Management. The Division of Purchasing and Materials
Management will review the "Application for Waiver" and any other applicable
information contained in the proposal to determine if the MBE/WBE participation
requirements will be waived. The ability of other offerors to obtain MBE/WBE
participation will be considered by the Division of Purchasing and Materials
Management in determining whether to grant a waiver for any offeror not
obtaining the required MBE/WBE participation. The Division of Purchasing and
Materials Management reserves the right to request additional information from
offerors to determine compliance with the MBE/WBE participation requirements.


<PAGE>


                   DOCUMENTATION OF MBE/WBE PARTICIPATION FORM

THE OFFEROR MUST PROVIDE A COPY OF THIS PAGE TO EACH MBE/WBE TO COMPLETE. EACH
MBE/WBE PARTICIPATING IN THE CONTRACT MUST COMPLETE THIS FORM SEPARATELY. IF THE
OFFEROR QUALIFIES AS A MBE AND/OR WBE, THE OFFEROR MUST ALSO COMPLETE THIS FORM.
ALL COMPLETED FORMS MUST BE SUBMITTED WITH THE OFFEROR'S PROPOSAL.

INDICATE APPROPRIATE BUSINESS CLASSIFICATION(S):        ______ MBE   ______ WBE

NAME OF MBE/WBE FIRM:      ___________________________________________________
ADDRESS:                   ________________________     PHONE #: _____________

CITY/STATE/ZIP:                     ___________________   FAX #:  _____________

EMAIL ADDRESS:    ___________________________    VENDOR #:        _____________

Describe the products/services you will be providing. (Note: Products/services
provided by MBE/WBEs must provide a commercially useful function related to the
delivery of the products/services required herein.)

------------------------------------------------------------------------------

------------------------------------------------------------------------------
------------------------------------------------------------------------------

------------------------------------------------------------------------------
------------------------------------------------------------------------------

------------------------------------------------------------------------------

PARAGRAPH REVISED BY AMENDMENT # 003:
Provide an estimate of the total dollar value of the products/services you are
providing for the initial contract period or an estimate of the percentage
dollar value of the products/services you are providing in relation to the total
dollar value of the initial contract period.

                           $                                  %

Provide or attach an explanation of the assumptions used in the development of
the above estimates.

------------------------------------------------------------------------------

------------------------------------------------------------------------------
------------------------------------------------------------------------------

------------------------------------------------------------------------------
------------------------------------------------------------------------------

------------------------------------------------------------------------------

PARAGRAPH REVISED BY AMENDMENT # 003:
EACH MBE/WBE MUST PROVIDE THEIR STATE OF MISSOURI, DIVISION OF PURCHASING AND
MATERIALS MANAGEMENT CERTIFICATION NUMBER BELOW. AN MBE/WBE WHO IS NOT CERTIFIED
MUST, AT A MINIMUM, HAVE APPLIED FOR CERTIFICATION WITH THE STATE OF MISSOURI,
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT. A LETTER OR OTHER DOCUMENTATION
FROM THE DIVISION OF PURCHASING AND MATERIALS MANAGEMENT VERIFYING RECEIPT OF
THE APPLICATION MUST BE ATTACHED.

BY SIGNING BELOW, THE UNDERSIGNED HEREBY AFFIRMS THAT HE/SHE OR THE COMPANY THAT
HE/SHE REPRESENTS MEETS THE DEFINITION OF A MBE OR WBE AS DEFINED IN RSMO
37.020.

SIGNATURE LINES REVISED BY AMENDMENT # 003:
                                                  FEIN/
Name of MBE/WBE Owner:                            SSN:
                           ---------------------          ---------------------

Signature of MBE/WBE Owner:                       Date:
                            --------------------          ---------------------

Certification Number:                 _______________________________


<PAGE>



                           APPLICATION FOR WAIVER FORM

IF LESS THAN 20% OF THE TOTAL DOLLAR VALUE OF THE CONTRACT WILL BE PERFORMED BY
MBES OR LESS THAN 10% OF THE TOTAL DOLLAR VALUE OF THE CONTRACT WILL BE
PERFORMED BY WBES, THE OFFEROR MUST APPLY FOR A WAIVER OF THE MBE/WBE
PARTICIPATION REQUIREMENTS BY COMPLETING THIS FORM.


Indicate which participation requirement the offeror is requesting a waiver of:
 ______ MBE       ______ WBE
(A separate Application for Waiver must be submitted for each.)

Section A - Initial Efforts:

(1) Describe steps taken by your firm to divide the specifications/requirements
into areas in which MBE/WBEs would be capable of performing.

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

(2) Note specific efforts made to identify potential MBE/WBEs to participate in
the contract (i.e. Contacting the Division of Purchasing and Materials
Management's MBE/WBE Purchasing Program, minority or women business councils and
trade associations, or other resources identified herein, consulting minority or
women business directories, etc.). Provide dates of contact and person
contacted.

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

(3) Identify advertising efforts taken by your firm with the intent to recruit
potential MBE/WBEs to perform various aspects of the contract. (Provide names of
newspapers, dates of advertisements, and copies of ads.)

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

(4) Note specific written efforts to contact MBE/WBEs qualified to participate
in the contract in sufficient time to allow for their effective participation.
(Provide name, address, and telephone number of MBE/WBE firms contacted and
dates and copies of correspondence, etc.)

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------



<PAGE>



                     APPLICATION FOR WAIVER FORM, CONTINUED

Section B - Follow Up Efforts

(1) Describe efforts made by your firm to provide interested MBE/WBEs with
sufficiently detailed information about specifications and requirements of the
contract. (Submit copies of information provided to the MBE/WBEs.)

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

(2) If MBE/WBEs indicated a desire to participate or submitted bids, list
MBE/WBEs submitting bids and reasons for rejecting.

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------



Based on the above stated efforts made to obtain MBE/WBE participation, the
offeror hereby requests that the applicable participation requirements be
waived.

The undersigned hereby certifies that the statements provided in this
Application for Waiver are true and correct to the best of his/her knowledge,
information, and belief.


Signature of Offeror:      _____________________________________________

Name:                      _____________________________________________

Title:                     _____________________________________________

Company:                   _____________________________________________

Date:                      _____________________________________________



Note:    Information submitted on this form, supporting documentation, or other
         sources of information will be used to determine whether the waiver
         will be granted. Granting of the waiver is solely within the discretion
         of the Division of Purchasing and Materials Management.

         THE ABILITY OF COMPETING OFFERORS TO OBTAIN MBE/WBE PARTICIPATION WILL
         BE CONSIDERED BY THE DIVISION OF PURCHASING AND MATERIALS MANAGEMENT IN
         DETERMINING WHETHER TO GRANT A WAIVER FOR ANY OFFERORS NOT OBTAINING
         THE REQUIRED MBE/WBE PARTICIPATION.


<PAGE>




9.11     RESOURCES:

MANY RESOURCES ARE AVAILABLE TO ASSIST OFFERORS IN THEIR EFFORTS TO IDENTIFY AND
SECURE THE PARTICIPATION OF MBES AND WBES IN PROVIDING THE PRODUCTS/SERVICES
REQUIRED HEREIN:

A listing of MBEs and WBEs is available on the Internet at:
http://www.oa.state.mo.us/purch/purch.htm or at the following address:

Office of Administration, Div. Of Purchasing & Materials Management,
MBE/WBE Purchasing Program
P.O. Box 809, Harry S Truman Bldg., Room 430
Jefferson City MO 65102
(800) 592-6019 or (573) 526-1467, FAX: (573) 526-3576

Additional resources are provided below:

SBA/Kansas City, MO, West District        Kansas City Minority Supplier Council
323 West 8th St., Suite 501               3017 Main Street, Suite 100
Kansas City, MO 64105                     Kansas City, MO 64108
(816) 374-6752, Fax: (816) 374-6734       (816) 931-9672, Fax: (816) 931-9673
Dorothy Kleeschulte                       Doris Ford
Dorothykleeschulte@sba.gov                df@m-s-c.org

Mo. Department of Transportation          SBA/St. Louis, MO, East District
P.O. Box 270                              815 Olive Street, Room 242
Jefferson City, MO 65102                  St. Louis MO 63101
(573) 751-2859, Fax: (573) 526-5640       (314) 539-6600 ext. 229,
                                          Fax: (314) 539-3785
Sharon Taegel                             Beverly Haake
Taeges@mail.modot.state.mo.us             beverly.haake@sba.gov

Bi-State Development Agency               St. Louis Minority Business Council
707 North 1st St.                         720 Olive St., Suite 1630
St. Louis, MO 63102                       St. Louis MO 63101
(314) 982-1457, Fax: (314) 982-1558       (314) 241-1143,  Fax: (314) 241-1073
Bertha Robinson                           Eddie Davis/Bill Mallory
Brobinson@bsda-transit.org                slmbc@primary.net

St. Louis Development Corporation City of Springfield, Personnel
Dep. 1015 Locust St. P.O. Box 8368 St. Louis MO 63102 Springfield
MO 65802 (314) 622-3400 ext. 362, Fax: (314) 622-3413 (417)
864-1599, Fax: (417) 864-2041 Beverly Govan Donna Cole
http://stlouis.missouri.org/development/orgs/
Donna_Cole@ci.springfield.mo.us
sldc/MWBE.html

St. Louis, Lambert International. Airport Human Relations Department, KCMO
DBE Program Office                        414      E. 12th Street,
4610 North Lindbergh                      4th floor, City Hall
St. Louis MO 63145                        Kansas City MO 64106
(314) 551-5000, Fax: (314) 551-5013       (816) 274-1432, Fax: (816) 274-1025
Linda Moore/E. Otey                       Ben Norton
eotey.aol.com                             bennorton@kcmo.org

Additional resources of publications for advertising to locate MBEs and WBEs are
provided below:

Kansas City Globe       Kansas City Hispanic News       St. Louis American
615 E. 29th Street      5999 Avenida Cesar E. Chavez    4144 Lindell Blvd.
Kansas City, MO         Kansas City, MO   64108-2147    St. Louis, MO   63108
(816) 531-5253          (816) 472-5246,                 (314) 533-8000,
                        Fax: (816) 472-6397             e-mail:  stlamer@mvp.net
e-mail: kchnews@sound.net

Kansas City Call        St. Louis Argus                 St. Louis Sentinel
1715 E. 18th Street     4595 Dr. Martin L. King Dr.     2900 N. Market
Kansas City, MO   64141  St. Louis, MO   63113           St. Louis, MO   63106
(816) 842-3804          (314) 531-1323                  (314) 531-2101
                         Fax: (314) 361-6421             Fax: (314) 531-4442



<PAGE>


                                    EXHIBIT A
                 ENHANCEMENT AND SCOPE OF WORK PRICING SCHEDULE
                     MEDICAID MANAGEMENT INFORMATION SYSTEM


NAME OF COMPANY: ______________________________________________________________

The offeror MUST provide pricing information as specified hereon to provide
services and equipment in accordance with the provisions and requirements of
this Invitation for Bid.

1.       ENHANCEMENT COST SCHEDULE

1.1      The offeror must state a firm, fixed price for each of the following
         pricing items to provide all service and equipment required to
         implement and/or operate, as applicable, each identified enhancement
         package as specified in the Scope of Work. The offeror is advised that
         the price(s) quoted below for the operation of each identified
         enhancement package shall remain firm and fixed for the duration of the
         contract. Prices for renewal option periods shall not exceed the prices
         quoted below.

1.1.1    Enhancement Package One

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.2    Enhancement Package Two

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.3    Enhancement Package Three

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.4    Enhancement Package Four

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.5    Enhancement Package Five

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.6    Enhancement Package Six

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month



<PAGE>


         1.1.7    Enhancement Package Seven

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.8    Enhancement Package Eight

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

                  c.  Workflow Consultant:  $__________________ Firm, fixed
                      price per hour

         1.1.9    Enhancement Package Nine

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

         1.1.10   Enhancement Package Ten

                  a.  System Modification:  $__________________ Firm,
                      fixed total price

                  b.  Operation:            $__________________ Firm,
                      fixed price per month

PARAGRAPH REVISED BY AMENDMENTS # 002 AND #003:
2.       ANNUAL PERIOD PRICING: The initial contract period includes an
         operation period of July 1, 2000 through June 30, 2007. In addition, as
         specified herein, the State of Missouri shall have the SOLE OPTION to
         renew the contract in one-year increments, or any portion thereof, for
         an two (2) additional years. This option shall apply to any or all of
         the services and equipment required herein. If exercised, the option
         shall be executed at prices not to exceed the prices quoted by the
         offeror on Exhibit A for each applicable option period.

PARAGRAPH REVISED BY AMENDMENT # 002:
2.1      FISCAL YEAR 2001 PRICES - JULY 1, 2000 THROUGH JUNE 30, 2001

         2.1.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2001 (July 1, 2000 through June
                  30, 2001) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty million seven hundred
                  thousand (50,700,000) claims and encounters during SFY 2001
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total price

                  CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2001. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof. The offeror must also state a
                  firm, fixed price per increment of three hundred thousand
                  (300,000) claims and encounters, or part thereof, which shall
                  be credited if claim and encounter volume is lower than
                  projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                      encounters to be credited

         2.1.3    CPU TIME FOR AD-HOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for ad-hoc
                  requests as specified in the Scope of Work. The offeror must
                  also state the manufacturer and model of the CPU on which the
                  offeror is proposing to operate the ad-hoc component.

                  a. $____________________ Firm, fixed price per CPU hour

b.       ________________________________Manufacturer and model of CPU

PARAGRAPH REVISED BY AMENDMENT # 002:
2.2      FISCAL YEAR 2002 PRICES - JULY 1, 2001 THROUGH JUNE 30, 2002

         2.2.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2002 (July 1, 2001 through June
                  30, 2002) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-three million two hundred
                  fifty thousand (53,150,000) claims and encounters during SFY
                  2002 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total price

         2.2.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2002. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof. The offeror must also state a
                  firm, fixed price per increment of three hundred thousand
                  (300,000) claims and encounters, or part thereof, which shall
                  be credited if claim and encounter volume is lower than
                  projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters to be credited

         2.2.3    CPU TIME FOR AD-HOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for ad-hoc
                  requests as specified in the Scope of Work. The offeror must
                  also state the manufacturer and model of the CPU on which the
                  offeror is proposing to operate the ad-hoc component.

a. $____________________ Firm, fixed price per CPU hour

PARAGRAPH REVISED BY AMENDMENT # 002:
2.3      FISCAL YEAR 2003 PRICES - JULY 1, 2002 THROUGH JUNE 30, 2003

         2.3.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2003 (July 1, 2002 through June
                  30, 2003) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-five million nine hundred
                  thousand (55,900,000) claims and encounters during SFY 2003
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.3.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2003. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters to be credited

         2.3.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour

PARAGRAPH REVISED BY AMENDMENT # 002:
2.4      FISCAL YEAR 2004 PRICES - JULY 1, 2003 THROUGH JUNE 30, 2004

         2.4.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2004 (July 1, 2003 through June
                  30, 2004) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-eight million seven
                  hundred thousand (58,700,000) claims and encounters during SFY
                  2004 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.4.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2004. Actual claim and encounter volume may be higher or
                  lower. For claim volume higher than projected, the offeror
                  must state a firm, fixed additional price per increment of
                  three hundred thousand (300,000) claims and encounters, or
                  part thereof, which shall be credited if claim and encounter
                  volume is lower than projected.

                   a. If claim and encounter volume is higher than projected:

                      $                     Firm, fixed price per 300,000
                      ---------------------
                      claims/encounters



<PAGE>


                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters to be credited

         2.4.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour

PARAGRAPH REVISED BY AMENDMENT # 002:
2.5      FISCAL YEAR 2005 PRICES - JULY 1, 2004 THROUGH JUNE 30, 2005

         2.5.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2005 (July 1, 2004 through June
                  30, 2005) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty-one million six hundred
                  fifty thousand (61,650,000) claims and encounters during SFY
                  2005 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.5.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2005. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters to be credited

         2.5.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour

PARAGRAPH REVISED BY AMENDMENT # 002:
2.6      FISCAL YEAR 2006 PRICES - JULY 1, 2005 THROUGH JUNE 30, 2006

         2.6.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2006 (July 1, 2005 through June
                  30, 2006) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty four million seven hundred
                  fifty thousand (64,750,000) claims and encounters during SFY
                  2006 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.6.2   CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                 above is based on the projected claim and encounter volume for
                 SFY 2006. Actual claim and encounter volume may be higher or
                 lower. For claim and encounter volume higher than projected,
                 the offeror must state a firm, fixed additional price per
                 increment of three hundred thousand (300,000) claims and
                 encounters, or part thereof, which shall be credited if claim
                 and encounter volume is lower than projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters to be credited

         2.6.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour

PARAGRAPH REVISED BY AMENDMENT # 002:
2.7      FISCAL YEAR 2007 PRICES - JULY 1, 2006 THROUGH JUNE 30, 2007

         2.7.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2007 (July 1, 2006 through June
                  30, 2007) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty-eight million (68,000,000)
                  claims and encounters during SFY 2007 and shall not include
                  those services for which prices are required elsewhere on
                  Exhibit A.

                  $____________________ Firm, fixed total base price

         2.7.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2007. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters to be credited

         2.7.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour


<PAGE>




PARAGRAPH ADDED BY AMENDMENT # 002:
2.8      1ST RENEWAL OPTION PERIOD PRICING:
         FISCAL YEAR 2008 - JULY 1, 2007 THROUGH JUNE 30, 2008

         2.8.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2008 (July 1, 2007 through June
                  30, 2008) as specified in the Scope of Work. This price shall
                  be based on the processing of seventy-one million four hundred
                  thousand (71,400,000) claims and encounters during SFY 2008
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.8.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2008. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                       encounters to be credited

         2.8.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour

PARAGRAPH ADDED BY AMENDMENT # 002:
2.9      2ND RENEWAL OPTION PERIOD PRICING:
         FISCAL YEAR 2009 - JULY 1, 2008 THROUGH JUNE 30, 2009

         2.9.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2009 (July 1, 2008 through June
                  30, 2009) as specified in the Scope of Work. This price shall
                  be based on the processing of seventy-four million nine
                  hundred seventy thousand (74,970,000) claims and encounters
                  during SFY 2009 and shall not include those services for which
                  prices are required elsewhere on Exhibit A.

                  $____________________ Firm, fixed total base price

         2.9.2    CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2007. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.


<PAGE>





                  a. If claim and encounter volume is higher than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters

                  b. If claim and encounter volume is lower than projected:

                      $____________ Firm, fixed price per 300,000 claims/
                        encounters to be credited

         2.9.3    CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $____________________ Firm, fixed price per CPU hour


<PAGE>



                                    EXHIBIT B
                                    PROJECT ASSESSMENT QUOTATION PRICE SCHEDULE


The offeror must provide pricing information as specified below. The offeror is
advised that the prices quoted on Exhibit B shall remain firm and fixed for the
duration of the contract. Prices for renewal option periods shall not exceed the
prices quoted below.

PARAGRAPH REVISED BY AMENDMENT # 002:
1.       FISCAL YEAR 2000 PRICING - DATE OF AWARD THROUGH JUNE 30, 2000

1.1      In the event that the State requires the contractor to provide services
         beyond those specified in the Scope of Work for the personnel
         classifications identified below, the offeror must state a firm, fixed
         price per hour for each such classification.

                  Personnel Classification         Firm, Fixed Price Per Hour

         1.1.1    Account Manager                   $_____________________

         1.1.2    Systems Director                  $_____________________

         1.1.3    Claims Manager                    $_____________________

         1.1.4    Support Services Manager          $_____________________

         1.1.5    Network Administrator             $_____________________

         1.1.6    System Programmer Supervisor      $_____________________

         1.1.7    Programmer (Programmer Analyst)   $_____________________

         1.1.8    Medicaid Information Analyst      $_____________________

         1.1.9    Medical Policy Registered Nurse   $_____________________

1.2      In the event that the State requires the contractor to provide
         additional personnel on a permanent basis (in addition to those
         specified in the Scope of Work), the offeror must state a firm, fixed
         price per month which shall apply to each personnel classification
         identified below.

                  Personnel Classification         Firm, Fixed Price Per Month

         1.2.1    Programmer/ Analyst               $______________________

         1.2.2    Medicaid Information Analyst      $______________________

         1.2.3    Medical Policy Nurse              $______________________

         1.2.4    Help Line Technician              $______________________

PARAGRAPH REVISED BY AMENDMENT # 002:
2.       SUCCEEDING FISCAL YEAR PERIOD PRICING:

         The offeror must indicate below the maximum allowable percentage of
         price increase or GUARANTEED minimum percentage of price decrease
         applicable to the respective fiscal year periods. If a percentage is
         not proposed (i.e. left blank, page not returned, etc.), the state
         shall apply the same price(s) proposed for the initial fiscal year
         period referenced in Paragraph 1, above. Statements such as "a
         percentage of the then-current price" or "consumer price index" are NOT
         ACCEPTABLE.

         All increases or decreases shall be calculated against the initial
         fiscal year period referenced in Paragraph 1 above, NOT AGAINST THE
         PREVIOUS YEAR'S PRICE. A CUMULATIVE CALCULATION SHALL NOT BE UTILIZED.

         The percentages indicated below shall apply to Exhibit B pricing and
         will be used in the cost evaluation to determine the potential maximum
         financial liability to the State of Missouri.

         NOTICE:  DO NOT COMPLETE BOTH A MAXIMUM INCREASE AND A MINIMUM DECREASE
                  FOR THE SAME RENEWAL PERIOD.
<TABLE>
<CAPTION>

                                      MAXIMUM INCREASE                          MINIMUM DECREASE

<S>                                 <C>                                      <C>
         Fiscal Year 2001:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2002:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2003:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2004:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2005:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2006:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         Fiscal Year 2007:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         1st Renewal Period,
         Fiscal Year 2008:          original price +           %  OR         original price -            %
                                                    -----------                               -----------

         2nd Renewal Period,
         Fiscal Year 2009:          original price +           %  OR         original price -            %
                                                    -----------                               -----------
</TABLE>

PARAGRAPH DELETED BY AMENDMENT # 002:
3. Deleted.



<PAGE>



                        EXHIBIT C - OFFEROR'S EXPERIENCE


1.       Contract Title:____________________________________________________

2.       Contract Period: From _______________________ To ___________________

3.       Geographic Area Served:___________________________________________

4.       Scope Work: ____________________________________________________

         ---------------------------------------------------------------

         ---------------------------------------------------------------

         ---------------------------------------------------------------

5.       References:       Contract Office:_____________________________________

                           Title:______________________________________________

                           Address:___________________________________________

                           City:_______________________________ State: _________

                           Telephone:__________________________________________



<PAGE>



                                   ATTACHMENTS


                                    A:    Medicaid Data Statistics

                                    B:    Claim Forms

                                    C:    Missouri Map of Managed Care Regions

                                    D:    Lotus Notes Applications

                                    E:    Claims Processing Schedule for
                                          Fiscal Year 1999

                                    F:    Hardware and Software Currently Used

                                    G:    DMS Network Configuration


The offeror is advised that the attachments to this document include hard copy
documents that are unable to be appropriately converted to an electronic format.
The attachments provide additional information and instruction for the offeror's
reference. In the event this document was downloaded from the Division of
Purchasing and Materials Management's Internet web site, the offeror must
contact the buyer of record as indicated on the front page of this document to
obtain copies of the attachments prior to submitting a proposal. It shall be the
sole responsibility of the offeror to request the attachments. The offeror shall
not be relieved of any responsibility for performance under the contract due to
the failure of the offeror to obtain copies of the attachments.


<PAGE>



[GRAPHIC OMITTED][GRAPHIC OMITTED]
STATE OF MISSOURI
OFFICE OF ADMINISTRATION
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
REQUEST FOR PROPOSAL


     CONTRACT NO.:  C900676001              REQ NO.:  886913750
     AMENDMENT NO.:  001                    BUYER:  GARY EGGEN
     TITLE: MMIS FISCAL AGENT SERVICES      PHONE NO.:  (573) 751-2497
     ISSUE DATE:  11/13/00                  E-MAIL:  EGGENG@MAIL.OA.STATE.MO.US


     TO: 1325952190 0
         VERIZON DATA SERVICES
         ATTN:  KIM MARONEY
         P.O BOX 177
         JEFFERSON CITY, MO 65102-0177

                          DIVISON OF PURCHASING AND MATERIALS MANAGEMENT
                         301 WEST HIGH STREET, ROOM 580
                                            PO BOX 809
                          JEFFERSON CITY MO 65102-0809

     DELIVER SUPPLIES/SERVICES FOB DESTINATION TO THE FOLLOWING AGENCY:

                          DEPARTMENT OF SOCIAL SERVICES
                           DIVISON OF MEDICAL SERVICES
                                            615 HOWERTON COURT
                                            PO BOX 6500
                          JEFFERSON CITY, MO 65109-6500


                               SIGNATURE REQUIRED


AUTHORIZED SIGNATURE      CONTRACTOR SIGNATURE NOT REQUIRED

DATE         _____  Check here if RFP was
             downloaded from internet.
PRINTED NAME
TITLE

COMPANY NAME
MAILING ADDRESS

CITY, STATE, ZIP

VENDOR NO. (IF KNOWN)
FEDERAL EMPLOYER ID NO.

PHONE NO.
FAX NO.
E-MAIL ADDRESS


                        NOTICE OF AWARD (STATE USE ONLY)


ACCEPTED BY STATE OF MISSOURI AS FOLLOWS:






CONTRACT NO.                                            CONTRACT PERIOD

BUYER                                          DATE              DIRECTOR
GARY  EGGEN          /S/         GARY  11/14/00          /S/ JOYCE MURPHY
EGGEN



<PAGE>



CONTRACT C900676001                                                PAGE 2 OF 2

                     AMENDMENT # 001 TO CONTRACT C900676001
                        TITLE: MMIS FISCAL AGENT SERVICES


The State of Missouri hereby amends the above referenced contract to change the
name of the contractor from GTE Data Services to Verizon Data Services, pursuant
to the attached letter to Joel Schnedler signed by James E. Judge of Verizon.

ALL OTHER TERMS CONDITIONS, AND PROVISIONS OF THE CONTRACT SHALL REMAIN THE
SAME, INCLUDING PRICES, AND APPLY HERETO. SIGNATURE OF THE CONTRACTOR IS NOT
REQUIRED.


<PAGE>


                  STATE OF MISSOURI
OFFICE OF ADMINISTRATION
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
REQUEST FOR PROPOSAL
[GRAPHIC OMITTED][GRAPHIC OMITTED]


AMENDMENT NO.  002                          REQ NO.:  886913750
RFP NO.  B900676                            BUYER:  GARY EGGEN
TITLE:       MMIS FISCAL AGENT SERVICES     PHONE NO.:  (573) 751-2497
ISSUE DATE:  06/03/99                       E-MAIL:  EGGENG@MAIL.OA.STATE.MO.US

RETURN PROPOSAL NO LATER THAN:   06/22/99 AT 2:00 PM


RETURN PROPOSAL AND AMENDMENT(S) TO:

                           DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
                           301 WEST HIGH STREET, ROOM 580
                           PO BOX 809
                           JEFFERSON CITY MO 65102-0809


CONTRACT PERIOD:  DATE OF AWARD THROUGH JUNE 30, 2007



The offeror hereby declares understanding, agreement and certification of
compliance to provide the items and/or services, at the prices quoted, in
accordance with all terms and conditions, requirements, and specifications of
the original RFP as modified by this and any previously issued amendments. The
offeror should, as a matter of clarity and assurance, also sign and return all
previously issued amendment(s) and the original document. The offeror further
agrees that upon receipt of an authorized purchase order from the Division of
Purchasing and Materials Management or when this document is countersigned by an
authorized official of the State of Missouri, a binding contract shall exist
between the offeror and the State of Missouri.


                               SIGNATURE REQUIRED
-------------------------------------------------------------------------------
AUTHORIZED SIGNATURE    /S/ DEBORAH ANDERS    DATE     ___X__ Check here if RFP
                                              06/17/99  was downloaded from
                                                        internet.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINTED NAME       DEBORAH ANDERS       TITLE   VICE PRESIDENT AND GENERAL
                                                MANAGER,
                                                COMMERCIAL SERVICES
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
COMPANY NAME          GTE DATA SERVICES, INC.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
MAILING ADDRESS     P.O. BOX290152

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CITY, STATE, ZIP       TEMPLE TERRACE, FL 33687

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
VENDOR NO. (IF KNOWN)                            FEDERAL EMPLOYER ID NO.
                                                 13-2595219
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PHONE NO. (813.978-5290     FAX NO. (813) 978-5614    E-MAIL ADDRESS
                                                  DEBORAH.ANDERS@TELOPS.GTE.COM
-------------------------------------------------------------------------------

                        NOTICE OF AWARD (STATE USE ONLY)

-------------------------------------------------------------------------------
ACCEPTED BY STATE OF MISSOURI AS FOLLOWS:







CONTRACT NO.                                            CONTRACT PERIOD
BUYER                                          DATE              DIRECTOR



<PAGE>




AMENDMENT # 002 TO RFP B900676

TITLE:  MMIS FISCAL AGENT SERVICES

PROSPECTIVE OFFERORS ARE HEREBY NOTIFIED OF THE FOLLOWING CHANGES:

1. The following paragraphs have been REVISED:
         3.8.4, 3.11.3 (3), the Documentation of MBE/WBE Participation Form
         (Page 82), and Pargarph 2 in Exhibit A.

2.            The following paragraph has been ADDED: 3.11.3 (6) and 3.11.3.1.








<PAGE>


            STATE OF MISSOURI
   OFFICE OF ADMINISTRATION
   DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
   REQUEST FOR PROPOSAL
[GRAPHIC OMITTED][GRAPHIC OMITTED]


AMENDMENT NO.  003        REQUISITION: NR 88625754000540
RFP NO.  B900676                                             BUYER:  GARY EGGEN
TITLE:       MMIS FISCAL AGENT SERVICES              PHONE NO.:  (573) 751-2497
ISSUE DATE:  11/17/03                       E-MAIL:  EGGENG@MAIL.OA.STATE.MO.US

TO:      VERIZON INFORMATION TECHNOLOGIES, INC.
         ATTN:  KIM MARONEY
         P.O. BOX 177
         JEFFERSON CITY, MO 65102-0177

RETURN AMENDMENT NO LATER THAN WEDNESDAY, MAY 29, 2002 TO:
                           DIVISION OF PURCHASING AND MATERIALS MANAGEMENT
                           301 WEST HIGH STREET, ROOM 580
                           PO BOX 809
                           JEFFERSON CITY MO 65102-0809

DELIVER SUPPLIES/SERVICES FOB DESTINATION TO THE FOLLOWING AGENCY:

                           DEPARTMENT OF SOCIAL SERVICES
                           DIVISON OF MEDICAL SERVICES
                           615 HOWERTON COURT
                           P.O. BOX 6500
                           JEFFERSON CITY, MO 65109-6500


                               SIGNATURE REQUIRED

-------------------------------------------------------------------------------
AUTHORIZED SIGNATURE    /S/ HARRY A. ARTZ III  DATE  __X___ Check here if  RFP
                                               06/17/99     was downloaded from
                                                            internet.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINTED NAME      HARRY A. ARTZ III       TITLE     SVP VERIZON INFORMATION
                                                    TECHNOLOGIES INC.
------------------------------------ ------------------------------------------
-------------------------------------------------------------------------------
COMPANY NAME    VERIZON INFORMATION TECHNOLOGIES INC.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
MAILING ADDRESS   ONCE EAST TELECOM PARKWAY

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CITY, STATE, ZIP   TEMPLE TERRACE, FL 33687

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
VENDOR NO. (IF KNOWN)                     FEDERAL EMPLOYER ID NO.   13-2595219

-------------------------------------------------------------------------------
------------------------------------ ------------------------------------------
PHONE NO. 813)978-5290   FAX NO. (813)978-5614  E-MAIL ADDRESS
                                                DEBORAH.ANDERS@TELOPS.GTE.COM
------------------------------------ ------------------------------------------

                        NOTICE OF AWARD (STATE USE ONLY)

-------------------------------------------------------------------------------
ACCEPTED BY STATE OF MISSOURI AS FOLLOWS:

ACCEPTED IN ITS ENTIRETY.





-------------------------------------------------------------------------------
CONTRACT NO.   C900676001            CONTRACT PERIOD  09/01/99 THROUGH 06/30/07
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
BUYER   GARY EGGEN              DATE   04/24/04   DIRECTOR    /S/ JAMES MILUSKI

-------------------------------------------------------------------------------


<PAGE>






Contract C900676001
Page 2 of 6
Contract C900676001
Page 2 of 6
AMENDMENT # 003 TO CONTRACT C900676001 TITLE: MMIS FISCAL AGENT SERVICES
The State of Missouri hereby amends contract C900676001 to include the following
Health Insurance Portability and Accountability Act of 1996 (HIP AA) c:ontract
provisions, terms, and conditions. 1.
1.1
BUSINESS ASSOCIATE PROVISIONS:
HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT OF 1996 (HIP AA)
The state agency is subject to and must comply with provisions of the Health
Insurance Portability and Accountability Act of 1996 (HIPAA) and all regulations
promulgated pursuant to authority granted therein. The contractor constitutes a
"Business Associate" of the state agency as such term is defined in the Code of
Federal Regulations (CFR) at 45 CFR 160.103. Therefore, the term, "contractor"
as used in this section shall mean "Business Associate." 1.1.1 The contractor
shall agree and understand that, except as set forth in this Section 1.1.1, for
purposes of the Business Associate Provisions contained herein, terms used but
not otherwise defined shall have the same meaning as those terms defined in 45
CFR parts 160 and 164, including, but not limited to the following:
   a.                "Designated Record Set" shall have the same meaning as the
                     term "designated record set" in 45 CFR 164.501, limited to
                     information maintained by the contractor for the state
                     agency.
b.   "Individual" shall have the same meaning as the term "individual" in 45 CFR
     160.103 and shall include a person who qualifies as a personal
     representative in accordance with 45 CFR 164.502 (g).
c.   "Privacy Rule" shall mean the Standards for Privacy of Individually
     Identifiable Health Information at 45 CFR part 160 and part 164, subparts A
     and E.
d.   "Protected Health Information" shall have the same meaning as "protected
     health information" in 45 CFR 164.501, limited to the information created
     or received by the contractor from or on behalf of the state agency.
1.1.2
The contractor shall agree the state agency must comply with 45 CFR 160 and 45
CFR 164, as currently in effect and as may be amended at some later date, and
that to achieve such compliance, the contractor must appropriately safeguard
Protected Health Information. To provide reasonable assurance of appropriate
safeguards, the contractor shall comply with the business associate provisions
stated herein.
1.1.3
The state agency and the contractor agree to amend the contract as is necessary
for the state agency to comply with the requirements of the Privacy Rule and
HIPAA requirements.
1.1.4
For additional information, 45 CFR 160 and 45 CFR 164 can be downloaded from the
Internet at the following Internet address:
http://www.access.gpo.gov/nara/cfr/pagel. However, the most current requirements
shall be those which are published in the Code of Federal Regulations.
1.2
Permitted uses and disclosures of Protected Health Information:
1.2.1
The contractor may use or disclose Protected Health Information to perform
functions, activities, or services for, or on behalf of, the state agency as
specified in the contract, provided that such use or disclosure would not
violate the Privacy Rule as the Privacy Rule applies to the state agency.


<PAGE>



Contract C900676001
1.2.2
1.2.3
1.2.4
1.2.5
1.2.6
1.3
1.3.1
1.3.2
1.3.3
Page 3 0f 6
The contractor may use Protected Health Information to report violations of law
to appropriate Federal and State authorities, consistent with 45 CFR
164.502GXI). Subject to the terms of the contract, the contractor may use or
disclose Protected Health Information for the proper management and
administration of the contractor's business or to carry out the legal
responsibilities of the contractor.
If the disclosure is required by law, the contractor may disclose Protected
Health Information to carry out the legal responsibilities of the contractor.
Ifthe disclosure is for the proper management and administration of the
contractor, the contractor must obtain reasonable assurances from the person to
whom the information is disclosed that the information will remain confidential
and used or further disclosed only as required by law or for the purpose for
which it was disclosed to the person, and the person must notify the contractor
of any instances of which it is aware in which the confidentiality ofthe
information is breached.
The contractor may use Protected Health Information to provide Data Aggregation
services to the state agency as permitted by 45 CFR 164.504(e)(2Xi)(B).
OBLIGATIONS OF THE CONTRACTOR:
The contractor shall not use or disclose Protected Health Information other than
as permitted or required by the contract or as otherwise required by law. The
contractor shall use appropriate safeguards to prevent use or disclosure of the
Protected Health Information other than as provided for by the contract. Such
safeguards may include, but shall not be limited to: a. Workforce training on
the appropriate uses and disclosures of Protected Health Information
   pursuant to the terms of the contract.
b. Policies and, procedures implemented by the contractor to prevent
   inappropriate uses and disclosures of Protected Health Information by its
   workforce.
c. Any other safeguards necessary to prevent the inappropriate use or disclosure
   of Protected Health Information.
The contractor shall require that any agent or subcontractor to whom the
contractor provides any Protected Health Information received from, created by,
or received by the contractor pursuant to the contract, also agrees to the same
restrictions and conditions stated herein that apply to the contractor with
respect to such information. a.
The contractor shall make the contractor's internal practices, books, and
records, including policies and procedures and Protected Health Information,
relating to the use and disclosure of Protected Health Information received
from, created by, or received by the contractor on behalf of the state agency
available to the Secretary of the Department of Health and Human Services or
designee, in a time and manner designated by the Secretary, for purposes of the
Secretary determining state agency's compliance with the Privacy Rule. b.
The contractor shall document any disclosures and information related to such
disclosures of Protected Health Information as would be required for the state
agency to respond to a request by an individual for an accounting of disclosures
of Protected Health Information in accordance with 45 CFR 164.528. By no later
than thirty (30) calendar days of receipt of a written request from the state
agency, or as otherwise required by state or federal law or


<PAGE>



Contract C900676001
1.4
1.4.1
1.4.2
1.4.3
1.4.4
1.4.5
Page 4 of 6

regulation, or by another time as may be agreed upon in writing by the
contractor and the state agency, the contractor shall provide such documentation
regarding an individual to the state agency.

c.
In order to meet the requirements under 45 CFR 164.524, the contractor shall,
within thirty (30) calendar days following a state agency request, or as
otherwise required by state or federal law or regulation, or by another time as
may be agreed upon in writing by the contractor and the state agency, provide
the state agency access to the Protected Health Information in an individual's
Designated Record Set. However, if requested by the state agency, the contractor
shall provide access to the Protected Health Information in a Designated Record
Set directly to the individual to whom such information relates.
d.   At the direction of the state agency, the contractor shall promptly make
     any amendment(s) to Protected Health Information in a Designated Record Set
     pursuant to 45 CFR 164.526.
e.
By no later than fifteen (15) calendar days after the contractor becomes aware
of any use or disclosure of the Protected Health Information not permitted or
required as stated herein, the contractor shall notify the state agency's
Privacy Officer, in writing, of the unauthorized use or disclosure and shall
take immediate action to stop the unauthorized use or disclosure. The contractor
shall include a description of any remedial action taken to mitigate any harmful
effect of such disclosure. The contractor shall also provide the state agency's
Privacy Officer with a proposed written plan of action for approval that
describes plans for preventing any such future unauthorized uses or disclosures.
OBLIGATIONS OF THE STATE AGENCY:
The state agency shall notify the contractor of limitation(s) that may affect
the contractor's use or disclosure of Protected Health Information, by providing
the contractor with the state agency's notice of privacy practices in accordance
with 45 CFR 164.520.
The state agency shall notify the contractor of any changes in, or revocation
of, authorization by an Individual to use or disclose Protected Health
Information. The state agency shall notify the contractor of any restriction to
the use or disclosure of Protected Health Information that the state agency has
agreed to in accordance with 45 CFR 164.522. The state agency shall not request
the contractor to use or disclose Protected Health Information in any manner
that would not be permissible under the Privacy Rule as the Privacy Rule applies
to the state agency. Expiration/Termination/Cancellation - Except as provided in
the subparagraph below, upon the expiration, termination, or cancellation of the
contract for any reason, the contractor shall return to the state agency or shah
destroy all Protected Health Information received by the contractor from the
state agency, or created or received by the contractor on behalf of the state
agency, and shall not retain any copies of such Protected Health Information.
This provision shall also apply to Protected Health Information that is in the
possession of subcontractors or agents of the contractor.
a.
In the event the contractor determines and the state agency agrees that
returning or destroying the Protected Health Information is not feasible, the
contractor shall extend the protections of the contract to the Protected Health
Information for as long as the contractor maintains the Protected Health
Information and shall limit the use and disclosure of the Protected Health
Information to those purposes that made return or destruction of the information
infeasible. If at any time it becomes feasible to return or destroy any such


<PAGE>




Protected Health Information maintained pursuant to this paragraph, the
contractor must notify the state agency and obtain instructions from the state
agency for either the return or destruction of the Protected Health Information.

1.4.6
Breach of Contract: In the event the contractor is in breach of contract with
regard to the business associate provisions included herein, the contractor
shall agree and understand that in addition to the requirements of the contract
related to cancellation of contract, if the state agency detenuines that
cancellation of the contract is not feasible, the State of Missouri may elect
not to cancel the contract, but the state agency shall report the contractual
breach to the Secretary of the Department of Health and Human Services. All
other terms, conditions and provisions of the contract shall remain the same and
apply hereto. The contractor shall sign and return this documentation.
Contract C900676001
Page 5 of 6



<PAGE>


STATE OF MISSOURI
OFFICE OF ADMINISTRATION
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT CONTRACT AMENDMENT
CONTRACT NO.: C900676001
AMENDMENT NO.: 004
TITLE: MMIS FISCAL AGENT SERVICES ISSUE DATE: 8/24/04
BUYER: GARY EGGEN
PHONE NO.: (573) 751-2497
E-MAIL: GARY.EGGEN@OA.MO.GOV
TO: VERIZON INFORMATION TECHNOLOGIES ATTN: DIANE TWEHOUS
       P.O BOX 177
       JEFFERSON CITY, MO 65102-0177
RETURN AMENDMENT NO LATER THAN FRIDAY, AUGUST 27, 2004 TO:
DIVISION OF PURCHASING AND MATERIALS MANAGEMENT 301 WEST HIGH STREET, ROOM 580
PO BOX 809
JEFFERSON CITY MO 65102-0809
DELIVER SUPPLIES/SERVICES FOB DESTINATION TO THE FOLLOWING AGENCY:
DEPARTMENT OF SOCIAL SERVICES DIVISION OF MEDICAL SERVICES 615 HOWERTON COURT
PO BOX 6500
JEFFERSON CITY, MO 65109-6500
SIGNATURE REQUIRED
-------------------------------------------------------------------------------
  AUTHORIZED SIGNATURE   /s/ Harry A. Artz III                DATE    4.13.04
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  PRINTED NAME                         TITLE
  Harry A. Artz III                    SVP  Verizon  Information  Technologies,
                                            Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  COMPANY NAME
  Verizon Information Technologies Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  MAILING ADDRESS
  One East Telecom Parkway
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  CITY, STATE, ZIP
  Temple Terrace, Rorida 33637
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  VENDOR NO. (IF KNOWN)                               FEDERAL EMPLOYER ID NO.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  PHONE NO.              FAX NO.                              E-MAIL ADDRESS
-------------------------------------------------------------------------------
NOTICE OF AWARD (STATE USE ONLY)
  ACCEPTED in its entirety.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  CONTRACT NO. C90676001     CONTRACT PERIOD         09/01/04 THROUGH 06/30/07
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
  BUYER   Gary Eggen  /s/ Gary Eggen    DATE     DIRECTOR    /s/ James Miluski
                                        04/28//04
[GRAPHIC OMITTED][GRAPHIC OMITTED]



<PAGE>



Contract C900676001 Page 2 of 6

AMENDMENT # 004 TO CONTRACT C900676001 TITLE: MMIS FISCAL AGENT SERVICES
CONTRACT PERIOD: SEPTEMBER 1, 1999 THROUGH JUNE 30, 2007

The State of Missouri hereby amends the contract to include the following
ongoing operations required to support the HIP AA (Health Insurance Portability
and Accountability Act) compliant X12 transaction formats and functionality. In
accordance with the federally mandated HlPAA requirements, Verizon IT has
modified and enhanced the Missouri Medicaid Management Information System (MMIS)
and the eMomed.com website for the purpose of compliance with HIP AA Standards
for Electronic Transactions and Code Sets. The implementation of the modified
and enhanced MMIS and ancillary systems changes were completed in October 2003
as required by the Department of Health and Human Services (HHS) and the Centers
for Medicaid and Medicare Services (CMS). 1.
Ongoing Operations to Support mp AA Compliant X12 Transaction Formats:
1.1
MMIS must be able to perform the translations necessary to take in HIP AA
compliant transactions and convert them to formats used in the MMIS. HIP AA
compliancy is dependent on the utilization of such a translation tool. The
Mercator Translator is a type of software that performs this translation
function. The Mercator Translator is new to the MMIS and is required in order to
perform translations functions for each X12 transaction created, received and
processed by the MMIS.
1.1.1
As a result of the installation of the Mercator Translator software technology
and the processing of HIP AA compliant transactions, data center processing
charges have increased.
1.2
The eMomed application required a fai10ver solution, additional storage capacity
to accommodate growth, added hardware and software maintenance and additional
infrastructure support.
1.2.1
As a result of the installation of a required failover solution, additional
storage capacity, added hardware and software maintenance and additional
infrastructure support, the eMomed application support costs have increased. 2.
Data Center Processing Charges and Application Support Costs:
2.1
Due to the increases described above, the additional ongoing charges for
processing the new transaction formats listed in the table below are effective
November 1,2003.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
         Period            Orig. Contract      Monthly Increase        New Monthly           New Period
                            Period Total                                  Total                Total
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
<S>                       <C>                 <C>                   <C>                   <C>
    Fiscal Year 2004       $14,968,501.00         $88,000.00          $1,335,375.08        $15,672,501.00
    7/1/03 - 6/30/04                          beginning 11/1/03     beginning 11/1/03
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
    Fiscal Year 2005       $15,720,751.00         $91,520.00          $1,401,582.58        $16,818,991.00
    7/1/04 - 6/30/05
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
    Fiscal Year 2006       $16,511,248.00         $95,181.00          $1,471,118.33        $17,653,420.00
    7/1/05 - 6/30/06
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
    Fiscal Year 2007       $17,340,000.00         $98,988.00          $1,543,988.00        $18,527,856.00
    7/1/06 - 6/30/07
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
  1 S( Renewal Period      $18,207,002.00        $102,948.00          $1,620,198.17        $19,442,378.00
    Fiscal Year 2008
    7/1/07 - 6/30/08
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
   2nd Renewal Period      $19,117,352.00        $107,065.00          $1,700,177 .67       $20,402,132.00
    Fiscal Year 2009
    7/1/08 - 6/30/09
-------------------------------------------------------------------------------------------------------------
</TABLE>
All other terms, conditions and provisions of the contract shall remain
unchanged. Contractor shall indicate agreement to the above specified changes by
signing and returning this document on or before the due date specified.


<PAGE>



[GRAPHIC OMITTED][GRAPHIC OMITTED]
NOTICE OF AWARD

STATE OF MISSOURI OFFICE OF ADMINISTRATION DIVISION OF PURCHASING AND MATERIALS
MANAGEMENT PO BOX 809 JEFFERSON CITY, MO 65102 WWW.OA.MO.GOV/PURCHLPURCH.HTM

-------------------------------------------------------------------------------
 CONTRACT NUMBER I AMENDMENT NUMBER              REQUISITION NUMBER
 C900676001 / AMENDMENT 005                      NR 886 46155003736
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
 CONTRACT TITLE                         CONTRACT PERIOD
 MMIS FISCAL AGENT SERVICES             SEPTEMBER 1, 1999 THROUGH JUNE 30, 2007
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
 CONTRACTOR'S VENDOR CODE, NM1E, AND ADDRESS    STATE AGENCY'S NAME AND ADDRESS
 VERIZON INFORMATION TECHNOLOGIES               DEPARTMENT OF SOCIAL SERVICES
 ATTN: DIANE TWEHOUS                            DIVISION OF MEDICAL SERVICES
 P.O BOX 177                                    615 HOWERTON COURT
 JEFFER.SON CITY, MO 65102-0177                 PO BOX 6500
                                                JEFFERSON CITY, MO 65109-6500
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
 ACCEPTED BY THE STATE OF MISSOURI AS FOLLOWS:

Contract hereby assigned to Verizon Information Technologies, Inc. pursuant to
the attached Agreement and Consent to Assignment of Contract executed by Verizon
Data Services and Verizon Information Technologies. As contractor is indicated
in the attached. No further acceptance or signature of the contractor is
required.

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
 BUYER                                            PHONE NUMBER
 GARY EGGEN                                       (573) 751-2497
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
 SIGNATURE OF BUYER                               EFFECTIVE DATE
  /S/ GARY EGGEN                                  05/13/01
----------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
        DIRECTOR OF PURCHASING AND MATERIALS MANAGEMENT


 JAMES MILUSKI                            /S/ JAMES MILUSKI
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------




<PAGE>


Contract C900676001                                              Page 1
of 1


                              AGREEMENT AND CONSENT
                            TO ASSIGNMENT OF CONTRACT


Verizon Data Services                    Verizon Information Technologies, Inc.
P. O. Box 177                            P.O. Box 177
905 Weathered Rock Road                  905 Weathered Rock Road
Jefferson City, MO 65101-0177            Jefferson City, MO 65101-0177
(Assignor)                               (Assignee)


         RE:      CONTRACT C900676001

         The Assignor, as named above, assigns the contract in its entirety to
         the Assignee, as named above. The assignment shall be effective May 13,
         2001.

         The Assignee shall honor and comply with all terms and conditions,
         requirements and specifications of the contract, and hereby entitles
         the State of Missouri to performance by Assignee of all obligations
         under the contract. This assignment does not entitled the Assignee to
         receive payment in any amount above that which the Assignor would
         otherwise receive. In addition, the Assignee releases the State of
         Missouri from all responsibilities for payment made previously to the
         Assignor pursuant to the contract.

         The Assignee agrees that any payments made by the State of Missouri
         pursuant to the contract, including all payments assigned to the
         Assignee, shall be contingent upon the performance of the Assignee in
         accordance with all terms and conditions, requirements and
         specifications of the contract, and the approval and acceptance of such
         performance by the State of Missouri.

         This Agreement and Consent shall not be final until it is incorporated
         into the subject contract by formal amendment subject to approval and
         acceptance by the State of Missouri, Division of Purchasing and
         Materials Management.

         IN WITNESS THEREOF, the parties hereto have executed this Agreement and
         Consent on the date as stated below.


         --------------------------------      --------------------------------
                   (assignor)                              (assignee)

         BY:        /s/ Michael J. Luebke      By:       /s/ Michael J. Luebke
         NAME:  Michael J. Luebke              NAME:   Michael J. Luebke
         TITLE:     Vice-President             TITLE:    President
         DATE:   May 30, 2001                  DATE:    May 30, 2001
                                               FEIN:      58-2040043


<PAGE>



Infocrossing Healthcare services, inc.
7320 east fletcher avenue # 172
Tampa, fl 33637
www. Infocrossing.com
v 813.490.6342
f 813.490.6345
October 4, 2004
Joel Schnedler
Deputy Director.
Division of Information Systems
615 Howerton Court
Jefferson City, MO 65102-6500
 Dear Joel,

Today I am pleased to announce the completion of the acquisition of the VITI
healthcare business by Infocrossing, Inc. (NASDAQ: IFOX): We are enthusiastic
about this significant milestone with Infocrossing and excited about the
opportunities that lie ahead.

Infocrossing is a publicly traded outsourcing provider with solid financials, an
impressive client .base, operations throughout the United States, and a strong
commitment to growth. Joining Infocrossing will provide the valued managed, care
Medicare and Medicaid customer base new and exciting opportunities for enhanced
support and services.

A few important comments concerning the transaction:

o The acquired business will assume the name of Infocrossing Healthcare
Services, Inc.
o        As President of the Healthcare Services organization, I will play a
         central role in managing the strategy and services of the overall
         business and look forward to becoming acquainted with you.
o        The same people that are supporting your business today will continue
         to do so as Infocrossing Healthcare Services employees. This will
         ensure continuity in day-to-day operations and a smooth transfer of
         responsibilities from VITI to Infocrossing.

This is an exciting opportunity for Infocrossing and a positive step for our
clients. As we embark on this exciting new chapter together. I ask that you put
your confidence in Infocrossing Health Services and your account management
team. Prior to our scheduled meeting, should you have any questions or concerns,
please feel free to contact your account manager Diane Twehous or you can reach
me direct at 813.490.6343.

I look forward to seeing you again soon, and to a longstanding business
relationship.

Best regards,

/s/ Michael J. Luebke

Michael Luebke
President
Infocrossing Healthcare Services, Inc.




                                   Jefferson city, mo / phoenix, az / tampa, fl



<PAGE>



..

[GRAPHIC OMITTED][GRAPHIC OMITTED]
NOTICE OF AWARD

STATE OF MISSOURI OFFICE OF ADMINISTRATION DIVISION OF PURCHASING AND MATERIALS
MANAGEMENT PO BOX 809 JEFFERSON CITY, MO 65102 www.oa.mo.gov/purch/purch.htm

CONTRACT NUMBER I AMENDMENT NUMBER
REQUISITION NUMBER
C900676001 / Amendment 006
N/A
CONTRACT TITLE
CONTRACT PERIOD
MMIS Fiscal Agent Services CONTRACTOR'S VENDOR CODE, NAME, AND ADDRESS September
1, 1999 through June 30, 2007
 STATE AGENCY'S NAME AND ADDRESS
INFOCROSSING HEALTHCARE SERVICES, INC. ATTN: DIANE TWEHOUS
P.O BOX 177
905 WEATHERED ROCK ROAD
JEFFERSON CITY, MO 65102-0177
DEPARTMENT OF SOCIAL SERVICES DMSION OF MEDICAL SERVICES 615 HOWERTON COURT
PO BOX 6500
JEFFERSON CITY, MO 65109-6500
ACCEPTED BY THE  ST ATE OF MISSOURI AS FOLLOWS:

Contract hereby amended to recognize the contractor name change from Verizon
Information Technologies, Inc.. to Infocrossing Healthcare Services, Inc..
pursuant to the attached letter from Michael Luebke dated October 4, 2004. No
change in contractor's vendor number or FEIN is applicable. Acceptance of the
contractor is indicated in the attached. No further acceptance or signature of
the contractor is required.

BUYER
 Gary Eggen
SIGNATURE OF BUYER
   /s/ Gary Eggen
PHONE  NUMBER (573) 751-2497
DATE
02/15/05
DIRECTOR OF PURCHASING AND MATERIALS MANAGEMENT

                                      -
James Miluski                            /s/ James Miluski


<PAGE>


                                    EXHIBIT A
                 ENHANCEMENT AND SCOPE OF WORK PRICING SCHEDULE
                     MEDICAID MANAGEMENT INFORMATION SYSTEM


NAME OF COMPANY:           GTE DATA SERVICES, INC.



                           As required by the RFP, GTEDS provides the completed
                           Exhibit A.



                           AUTHORIZED SIGNATURE:

                           /S/ DEBORAH ANDERS

                           DEBORAH ANDERS
                           VICE-PRESIDENT AND GENERAL MANAGER
                           GTEDS COMMERCIAL SERVICES



                           DATE:    AUGUST 16, 1999


<PAGE>


                                    EXHIBIT A
                 ENHANCEMENT AND SCOPE OF WORK PRICING SCHEDULE
                     MEDICAID MANAGEMENT INFORMAITON SYSTEM


NAME OF COMPANY:           GTE DATA SERVICES INC.

The offeror MUST provide pricing information as specified heron to provide
services and equipment in accordance with the provision and requirements of this
Invitation for Bid.

1.       ENHANCEMENT COST SCHEDULE

1.1      The offeror must state a firm, fixed price for each of the following
         pricing items to provide all service and equipment required to
         implement and/or operate, as applicable, each identified enhancement
         package as specified in the Scope of Work. The offeror is advised that
         the price(s) quoted below for the operation of each identified
         enhancement package shall remain firm and fixed for the duration of the
         contract. Prices for renewal option periods shall not exceed the prices
         quoted below.

1.1.1    Enhancement Package One

         a.  System Modification:      $  5,433.438  Firm, fixed total price
                                       --------------

         b.  Operation:                $    24,436  Firm, fixed price per month
                                       ----------------

1.1.2    Enhancement Package Two

         a.  System Modification:       $    705,230   Firm, fixed total price
                                        ---------------

         b.  Operation:                 $   5,008   Firm, fixed price per month
                                        -----------------

1.1.3    Enhancement Package Three

         a.  System Modification:       $  6,101.616  Firm, fixed total price
                                        --------------

         b.  Operation:                 $    3,712  Firm, fixed price per month
                                        -----------------

1.1.4    Enhancement Package Four

         a.  System Modification:       $     245,516  Firm, fixed total price
                                        ---------------

         b.  Operation:                 $      248  Firm, fixed price per month
                                        ------------------

1.1.5    Enhancement Package Five

         a.  System Modification:       $  3,162,587  Firm, fixed total price
                                        --------------

         b.  Operation:                 $   31,401  Firm, fixed price per month
                                        ----------------

1.1.6    Enhancement Package Six

         a.  System Modification:       $     329,517  Firm, fixed total price
                                        ---------------

         b.  Operations:                $   38,908  Firm, fixed price per month
                                        ----------------

1.1.7

<PAGE>


         Enhancement Package Seven

         a.  System Modification:       $  1,484,453  Firm, fixed total price
                                        -------------

         b.  Operation:                 $    1,702  Firm, fixed price per month
                                        ---------------

1.1.8    Enhancement Package Eight

         a.  System Modification:       $  4,017,989  Firm, fixed total price
                                        --------------

         b.  Operation:                 $   64,252  Firm, fixed price per month
                                        ---------------

         c.  Workflow Consultant        $       325  Firm, fixed price per hour
                                        --------------

1.1.9    Enhancement Package Nine

         a.  System Modification:       $  1,592,567  Firm, fixed total price
                                        --------------

         b.  Operation:                 $    3,895  Firm, fixed price per month
                                        -------------

1.1.10   Enhancement Package Ten

         a.  System Modification:       $  3,334,667  Firm, fixed total price
                                        -------------

         b.  Operation:                 $    3,494  Firm, fixed price per month
                                        ------------

PARAGRAPH REVISED BY AMENDMENT #002 AND #003
2.       ANNUAL PERIOD PRICING: The initial contract period includes an
         operation period of July 1, 2000 through June 30, 2007. In addition, as
         specified herein, the State of Missouri shall have the SOLE OPTION to
         renew the contract in one-year increments, or any portion thereof, for
         an two (2) additional years. This option shall apply to any or all of
         the services and equipment required herein. If exercised, the option
         shall be executed at prices not to exceed the prices quoted by the
         offeror on Exhibit A for each applicable option period.

PARAGRAPH REVISED BY AMENDMENT #002
2.1      FISCAL YEAR 2001 PRICES - JULY 1, 2000 THROUGH JUNE 30, 2001

         2.1.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2001 (July 1, 2000 through June
                  30, 2001) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty million seven hundred
                  thousand (50,700,000) claims and encounters during SFY 2001
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $    12,928,501  Firm, fixed total price
                  -----------------

                  CLAIM AND ENCOUNTER VOLUME ADJUSTEMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2001. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof. The offeror must also state a
                  firm, fixed price per increment of three hundred thousand
                  (300,000) claims and encounters, or part thereof, which shall
                  be credited if claim and encounter volume is lower than
                  projected.
A.

<PAGE>


                  If claim and encounter volume is higher than projected:

                      $    21,000  Firm, fixed price per 300,000 claims/
                      -------------           encounters

b. If claim and encounter volume is lower than projected:

                      $      9,000  Firm, fixed price per 300,000 claims/
                      --------------        encounters to be credited

         2.1.3 CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
fixed price per
                  CPU hour for CPU time in excess of four hundred twenty (420)
                  hours per state fiscal year for adhoc requests as specified in
                  the Scope of Work. The offeror must also state the
                  manufacturer and model of the CPU on which the offeror is
                  proposing to operate the adhoc component.

                  a.  $     925      Firm, fixed price per CPU hour
                      ---------------

a. Hitachi Data System Skyline 825 Manufacturer and model of CPU

PARAGRAPH REVSIED BY AMENDMENT #002
2.2      FISCAL YEAR 2002 PRICES - JULY 1, 2001 THROUGH JUNE 30, 2002

         2.2.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2002 (July 1, 2001 through June
                  30, 2002) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-three million two hundred
                  fifty thousand (53,150,000) claims and encounters during SFY
                  2002 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $    13,553,252  Firm, fixed total price
                  -----------------

2.2.2             CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2002. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof. The offeror must also state a
                  firm, fixed price per increment of three hundred thousand
                  (300,000) claims and encounters, or part thereof, which shall
                  be credited if claim and encounter volume is lower than
                  projected.

a. If claim and encounter volume is higher than projected:

                      $    21,000  Firm fixed price per 300,000 claims/
                      -------------      encounters

b. If claim and encounter volume is lower than projected:

                      $       9,000  Firm, fixed price per 300,000 claims/
                      ---------------       encounters to be credited

2.2.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work. The offeror must
                  also state the manufacture and model of the CPU on which the
                  offeror is proposing top operate the adhoc component.

                  a. $ 925 Firm, fixed price per CPU hour 9.12 PARAGRAPH REVISED
BY AMENDMENT #002 2.3 FISCAL YEAR 2003 PRICES - JULY 1, 2002 THROUGH JUNE 30,
2003

         2.3.1    MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2003 (July 1, 2002 through June
                  30, 2003) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-five million nine hundred
                  thousand (55,900,000) claims and encounters during DFY 2003
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $      14,254,503  Firm, fixed total base price
                  -----------------

2.3.2             CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2003. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

a. If claim and encounter volume is higher than projected:

                      $   21,000    Firm, fixed price per 300,000 claims/
                      ------------          encounters

b. If claim and encounter volume is lower than projected:

                      $      9,000    Firm, fixed price per 300,000 claims/
                      --------------         encounters to be credited

2.3.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $      925       Firm, fixed price per CPU hour
                  ---------------

9.13     PARAGRAPH REVISED BY AMENDMENT #002
2.4      FISCAL YEAR 2004 PRICES - JULY 1, 2003 THROUGH JUNE 30, 2004

2.4.1             MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2004 (July 1, 2003 through June
                  30, 2004) as specified in the Scope of Work. This price shall
                  be based on the processing of fifty-eight million seven
                  hundred thousand (58,700,000) claims and encounters during SFY
                  2004 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $  14,968,501    Firm, fixed total base price
                  ---------------

2.4.2    CLAIM AND ECOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2004. Actual claim and encounter volume may be higher or
                  lower. For claim volume higher than projected, the offeror
                  must state a firm, fixed additional price per increment of
                  three hundred thousand (300,000) claims and encounters, or
                  part thereof, which shall be credited if claim and encounter
                  volume is lower than projected.


<PAGE>



a. If claim and encounter volume is higher than projected:

                      $    21,000    Firm, fixed price per 300,000 claims/
                      -------------           encounters

b. If claim and encounter volume is lower than projected:

                      $     9,000    Firm, fixed price per 300,000 claims/
                      -------------           encounters to be credited

2.4.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $    925       Firm, fixed price per CPU hour
                  -------------

9.13.1   PARAGRAPH REVISED BY AMENDMENT #002
2.5      FISCAL YEAR 2005 PRICES - JULY 1, 2004 THROUGH JUNE 30, 2005

2.5.1             MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2005 (July 1, 2004 through June
                  30, 2005) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty-one million six hundred
                  fifty thousand (61,650,000) claims and encounters during SFY
                  2005 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $   15,720,751    Firm, fixed total base price
                  ----------------

2.5.2    CLAIM AND ENOUNTER VOLUME ADJUSTMENT - The base price stated
           above is based on the projected claim and encounter volume for SFY
           2005. Actual claim and encounter volume may be higher or lower. For
           claim and encounter volume higher than projected, the offeror must
           state a firm, fixed additional price per increment of three hundred
           thousand (300,000) claims and encounters, or part hereof, which shall
           be credited if claim and encounter volume is lower than projected.

a. If claim and encounter volume is higher than projected:

                      $   21,000    Firm, fixed price for 300,000 claims/
                      ------------           encounters

b. If claim and encounter volume is lower than projected:

                      $     9,000    Firm, fixed price per 300,000 claims/
                      -------------            encounters to be credited

2.5.3 CPU TIME FOR ADHOC REQUEST - The offeror must state a firm, fixed price
per
           CPU hour for CPU time in excess of four hundred twenty (420) hours
           per state fiscal year for adhoc requests as specified in the Scope of
           Work.

           $    925       Firm fixed price per CPU hour
           -------------


<PAGE>


PARAGRAPH REVISED BY AMENDMENT #002
2.6      FISCAL YEAR 2006 PRICES - JULY 1, 2005 THROUGH JUNE 30, 2006

2.6.1             MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2006 (July 1, 2005 through June
                  30, 2006) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty four million seven hundred
                  fifty thousand (64,750,000) claims and encounters during SFY
                  2006 and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

           $     16,511,248    Firm, fixed total base price
           ------------------

2.6.2             CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2006. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

a. If claim and encounter volume is higher than projected:

                      $    21,000    Firm, fixed price per 300,000 claims/
                      -------------           encounters

b. If claim and encounter volume is lower than projected:

                      $      9,000    Firm, fixed price per 300,000 claims/
                      --------------           encounters to be credited

2.6.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

           $     925       Firm, fixed price per CPU hour
           --------------

PARAGRAPH REVISED BY AMENDMENT #002
2.7      FISCAL YEAR 2007 PRICES - JULY 1, 2006 THROUGH JUNE 30, 2007

2.7.1             MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2007 (July 1, 2006 through June
                  30, 2007) as specified in the Scope of Work. This price shall
                  be based on the processing of sixty-eight million (68,000,000)
                  claims and encounters during SFY 2007 and shall not include
                  those services for which prices are required elsewhere on
                  Exhibit A.

                  $    17,340,000    Firm, fixed total base price
                  -----------------

2.7.2             CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2007. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

a. If claim and encounter volume is higher than projected:

                      $     21,000    Firm, fixed price per 300,000 claims/
                      --------------          encounters

b. If claim and encounter volume is lower than projected:

                      $      9,000    Firm, fixed price per 300,000 claims/
                      --------------          encounters to be credited

2.7.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $      925        Firm, fixed price per CPU hour
                  ----------------

PARAGRAPH ADDED BY AMENDMENT #002
2.8      1ST RENEAL OPTION PERIOD PRICING:
         FISCAL YEAR 2008 - JULY 1, 2007 THROUGH JUNE 30, 2008

2.8.1             MMIS - The offeror must state a firm, fixed total base price
                  for all services and equipment required to operate the MMIS
                  during state fiscal year (SFY) 2008 (July 1, 2007 through June
                  30, 2008) as specified in the Scope of Work. This price shall
                  be based on the processing of seventy-one million four hundred
                  thousand (71,400,000) claims and encounters during SFY 2008
                  and shall not include those services for which prices are
                  required elsewhere on Exhibit A.

                  $     18,207,002       Firm, fixed total base price
                  ---------------------

2.8.2             CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base price stated
                  above is based on the projected claim and encounter volume for
                  SFY 2008. Actual claim and encounter volume may be higher or
                  lower. For claim and encounter volume higher than projected,
                  the offeror must state a firm, fixed additional price per
                  increment of three hundred thousand (300,000) claims and
                  encounters, or part thereof, which shall be credited if claim
                  and encounter volume is lower than projected.

a. If claim and encounter volume is higher than projected:

                      $     21,000    Firm, fixed price per 300,000 claims/
                      --------------           encounters

b. If claim and encounter volume is lower than projected:

                      $      9,000     Firm, fixed price per 300,000 claims/
                      ---------------            encounters to be credited

2.8.3             CPU TIME FOR ADHOC REQUESTS - The offeror must state a firm,
                  fixed price per CPU hour for CPU time in excess of four
                  hundred twenty (420) hours per state fiscal year for adhoc
                  requests as specified in the Scope of Work.

                  $      925        Firm, fixed price per CPU hour
                  ----------------

                                                            EXHIBIT A


         PARAGRAPH ADDED BY AMENEDMENT # 002:
2.9      2ND RENEWAL OPTION PERIOD PRICING:
                  FISCAL YEAR 2009 - JULY 1, 2008 THROUGH JUNE 30, 2009

2.9.1.                     MMIS - The offeror must state a firm, fixed total
                           base price for all services and equipment required to
                           operate the MMIS during state fiscal year (SFY) 2009
                           (July 1, 2008 through June 30, 2009) as specified in
                           the Scope of Work. The price shall be based on the
                           processing of seventy-four million nine hundred
                           seventy thousand (74,970,000) claims and encounters
                           during SFY 2009 and shall not include those services
                           for which prices are required elsewhere on Exhibit A.

                           $      19,117,352  Firm, fixed total base price.
                           -------------------

2.9.2.                     CLAIM AND ENCOUNTER VOLUME ADJUSTMENT - The base
                           price stated above is based on the projected claim
                           and encounter volume for SFY 2007. Actual claim and
                           encounter volume may be higher or lower. For claim
                           and encounter volume higher than projected, the
                           offeror must state a firm, fixed additional price per
                           increment of three hundred thousand (300,000) claims
                           and encounters, or part thereof, which shall be
                           credited if claim and encounter volume is lower than
                           projected.

a.                         If claim and encounter volume is higher than
                           projected:

                               $    21,000    Firm, fixed price per 300,000
                               ---------------       claims/encounters.

b. If claim and encounter volume is lower than projected:

                               $    9,000     Firm, fixed price per 300,000
                               ------------- claims/encounters to be credited.

2.9.3.                     CPU TIME FOR ADHOC REQUESTS - The offeror must state
                           a firm, fixed price per CPU hour for CPU time in
                           excess of four hundred twenty (420) hours per state
                           fiscal year for adhoc requests as specified in the
                           Scope of Work.

                           $    925     Firm, fixed price per CPU hour.
                           -------------


<PAGE>





















                                    EXHIBIT B
                   PROJECT ASSESSMENT QUOTATION PRICE SCHEDULE


         NAME OF COMPANY:           GTE DATA SERVICES, INC.



                  As required by the RFP, GTEDS provides the completed Exhibit
B.



                  AUTHORIZED SIGNATURE:



                  __/S/  DEBORAH ANDERS________________________________
                  DEBORAH ANDERS
                  VICE-PRESIDENT AND GENERAL MANAGER
                  GTEDS COMMERCIAL SERVICES



                  DATE:  AUGUST 16, 1999














                                                           EXHIBIT B
                   PROJECT ASSESSMENT QUOTATION PRICE SCHEDULE



The offeror must provide pricing information as specified below. The offeror is
advised that the prices quoted on Exhibit B shall remain firm and fixed for the
duration of the contract. Prices for renewal option periods shall not exceed the
prices quoted below.

PARAGRAPH REVISED BY AMENDMENT # 002:
1.       FISCAL YEAR 2000 PRICING - DATE OF AWARD THROUGH JUNE 30, 2000

1.1      In the event that the State requires the contractor to provide services
         beyond those specified in the Scope of Work for the personnel
         classifications identified below, the offeror must state a firm, fixed
         price per hour for each such classification.

                           Personnel Classification   Firm, Fixed Price Per Hour

             1.1.1.        Account Manager            $             95.00
                                                      -------------------------

             1.1.2.        Systems Director           $             95.00
                                                      -------------------------

             1.1.3.        Claims Manager             $             87.00
                                                      -------------------------

             1.1.4.        Support Services Manager   $             87.00
                                                      -------------------------

             1.1.5.        Network Administrator      $             90.00
                                                      -------------------------

             1.1.6.        System Programmer
                              Supervisor              $             90.00
                                                      -------------------------

             1.1.7.        Programmer (Programmer
                              Analyst)                $             85.00
                                                      -------------------------

             1.1.8.        Medicaid Information
                              Analyst                 $              85.00
                                                      -------------------------

             1.1.9.        Medical Policy Registered
                              Nurse                   $              55.00
                                                      -------------------------

             1.2 In the event that the State requires the contractor to provide
             additional personnel on a permanent basis (in addition to those
             specified in the Scope of Work), the offeror must state a firm,
             fixed price per month which shall apply to each personnel
             classification identified below.

                           Personnel Classification   Firm, Fixed Price Per Hour

             1.2.1.        Programmer Analyst         $               10,500
                                                      -------------------------

             1.2.2.        Medicaid Information
                              Analyst                 $               10,500
                                                      -------------------------

             1.2.3.        Medical Policy Nurse       $                7,700
                                                      -------------------------

             1.2.4.        Help Line Technician       $                7,700
                                                      -------------------------





                                                                    EXHIBIT B

PARAGRAPH REVISED BY AMENEDMENT # 002:
2.       SUCCEEDING FISCAL YEAR PERIOD PRICING:

             The offeror must indicate below the maximum allowable percentage of
             price increase or GUARANTEED minimum percentage of price decrease
             applicable to the respective fiscal year periods. If a percentage
             is not proposed (i.e. left blank, page not returned, etc.), the
             state shall apply the same price(s) proposed for the initial fiscal
             year period referenced in Paragraph 1, above. Statements such as "a
             percentage of the then-current price" or "consumer price index" are
             NOT ACCEPTABLE.

             All increases or decreases shall be calculated against the initial
             fiscal year period referenced in Paragraph 1 above, NOT against the
             previous year's price. A CUMULATIVE CALCULATION SHALL NOT BE
             UTILIZED.

             The percentages indicated below shall apply to Exhibit B pricing
             and will be used in the cost evaluation to determine the potential
             maximum financial liability to the State of Missouri.

             NOTICE:       DO NOT  COMPLETE  BOTH A MAXIMUM  INCREASE  AND A
                           MINIMUM  DECREASE FOR THE SAME RENEWAL PERIOD.

<TABLE>
<CAPTION>
                        MAXIMUM INCREASE MINIMUM DECREASE

<S>                                         <C>                                 <C>
             Fiscal Year 2001:              original price +   3.5  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2002:              original price +   7.1  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2003:              original price +  10.8  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2004:              original price +  14.7  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2005:              original price +  18.8  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2006:              original price +  22.9  %  OR       original price - _________%
                                                           ----------

             Fiscal Year 2007:              original price +  27.2  %  OR       original price - _________%
                                                           ----------

             1st Renewal Period,
             Fiscal Year 2008:              original price +  31.7  %  OR       original price - _________%
                                                           ----------

             2nd Renewal Period,
             Fiscal Year 2009:              original price +   36.3  % OR       original price - _________%
                                                           -----------
</TABLE>

PARAGRAPH DELETED BY AMENDMENT # 002:
2. Deleted.