Exhibit
10.169


 


FIRST
AMENDMENT TO


PACIFICARE
OF CALIFORNIA


MEDICAL
GROUP/IPA SERVICES AGREEMENT


(PROFESSIONAL CAPITATION)


 


This First Amendment to the PacifiCare Medical Group/IPA Services
Agreement (the “Amendment”) is effective January 1, 2002 by and between
PacifiCare of California, a California corporation (“PacifiCare”), and Prospect
Health Source Medical Group (“Medical Group”), with respect to the following
facts:


 


RECITALS


 


A.                                   The parties have previously entered into that
certain PacifiCare Medical Group/IPA Services Agreement effective
January 1, 2001, (the “Agreement”).


 


B.                                     The parties desire to amend the terms of the
Agreement in the manner set forth herein.


 


NOW, THEREFORE, in consideration of the
foregoing, the parties hereto agree as follows:


 


1.                                       INCENTIVE PROGRAMS. Section 5.4.1, Incentive Program
Withhold, of the Agreement shall be deleted and replaced with the following
language.


 


5.4.1 Incentive Program Withhold.
PacifiCare shall establish a single withhold from Medical Group’s monthly Capitation
Payment for purposes of offsetting potential deficits for the combined
incentive programs.  The monthly
incentive withhold shall initially be *** per Member per month for the
PacifiCare Commercial Health Plan and *** per Member per month for the Secure
Horizons Health Plan.  The Incentive
Program Withhold shall not exceed *** per Member per month for the PacifiCare
Commercial Health Plan and *** per Member per month for the Secure Horizons
Health Plan.  Should the Incentive
Program Withhold exceed the Incentive Program Deficits, PacifiCare shall
prospectively adjust the withhold on a quarterly basis, based on Medical
Group’s experience under the combined incentive programs at the time of the
program settlements described below. 
Medical Group’s Incentive Program Withhold limits, as referenced above,
are based upon a calendar year.  To the
extent that Incentive Program Withhold amounts are decreased through the
quarterly settlement process, these amounts may be subsequently increased above
the stated withhold limits, provided that the average per member per month
Incentive Program Withhold for the calendar year does not exceed the stated
withhold limits.


 


2.                                       INCENTIVE PROGRAMS. Section 5.4.2, Incentive Program
Settlements, of the Agreement shall be deleted and replaced with the following
language.


 


PacifiCare shall
conduct combined settlements on a quarterly basis, inclusive of a reserve


 


Prospect Health Source Medical Group


Effective January 1, 2002


 












***   Confidential Information omitted and
filed separately with the Securities and Exchange Commission.


 


1

















 


allowance for
incurred but not reported claims expense, for all of the incentive programs for
Managed Care Plans applicable to Medical Group.  Surpluses and deficits under each of the incentive programs shall
be aggregated and offset against one another. 
Payments shall be made to the Medical Group within seventy five (75)
days after the end of each calendar quarter.


 


PacifiCare will
conduct a final calculation annually (the “Final Calculation”) based on the
contract calendar year.  The incentive
program withhold described above shall be refunded to the Medical Group at the
time of the incentive program settlements, except that Medical Group’s share of
any incentive program deficits shall be deducted from such refund.  Payments under the combined incentive
programs will be due from the owing party within one hundred and eighty (180)
days following the end of the contract calendar year for the Final Calculation.  To the extent a Medical Group deficit has
been carried forward from a prior settlement period, this deficit shall be
offset against amounts due to Medical Group hereunder.  In the event that claims for providers were
incurred during the contract calendar year in question but were not paid until
after the final calculation, such costs shall be carried forward and applied to
the subsequent contract calendar year’s incentive program as an expense for
that contract calendar year.


 


Incentive
Program Compliance with State and Federal Law.  PacifiCare and Medical Group acknowledge and agree that the
payments which may be made directly or indirectly under the incentive programs
described in this Agreement are not made as an inducement to reduce or limit
Covered Services to any specific Member. 
Medical Group acknowledges and agrees that any payments which may be
made directly or indirectly under physician incentive programs Medical Group
may utilize with respect to its Participating Providers shall not be made as an
inducement to reduce or limit Covered Services to any specific Member.  Medical Group further acknowledges and
agrees that the incentive programs described in this Agreement shall be subject
to modification by PacifiCare during the term of this Agreement in order to
comply with changes in State and Federal Law, and Medical Group further agrees
to modify any physician incentive programs utilized with respect to its
Participating Providers to comply with such changes.


 


3.                                       PRODUCT
ATTACHMENT A, PACIFICARE COMMERCIAL HEALTH PLAN shall be deleted in its
entirety from the Agreement and replaced with the attached PRODUCT ATTACHMENT
A.


 


4.                                       PRODUCT
ATTACHMENT B, PACIFICARE COMMERCIAL POINT-OF-SERVICE PLAN shall be deleted
in its entirety from the Agreement and replaced with the attached PRODUCT
ATTACHMENT B.


 


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5.                                       PRODUCT ATTACHMENT C, SECURE HORIZONS HEALTH
PLAN shall be deleted in its
entirety from the Agreement and replaced with the attached PRODUCT ATTACHMENT
C.


 


6.                                       DIVISION OF FINANCIAL RESPONSIBILITY shall be deleted in its entirety from the
Agreement and replaced with the attached DIVISION OF FINANCIAL RESPONSIBILITY.


 


7.                                       Use of Defined Terms. Terms utilized in this Amendment shall have
the same meaning set forth in the definitions to the Agreement.


 


8.                                       Existing Agreement Remains in Full Force and
Effect. Except as
specifically amended by this Amendment, the Agreement shall continue in full
force and effect.


 


9.                                       Representations and Warranties. The parties to this Agreement represent and
warrant that they have read the Agreement and this Amendment in their entirety;
that they fully understand their rights and obligations under this Agreement;
that they have executed this Agreement freely and voluntarily; that the
Agreement, as amended, constitutes the entire understanding and agreement
between the parties.  The parties hereto
further represent and warrant that they have had the time and opportunity to
consult with attorneys and financial advisors of their choice in connection
with the negotiation of this Amendment and the parties’ decision to enter into
this Amendment.  Neither party has
relied upon the other party to determine the reasonableness or enforceability
of the terms of this Amendment.


 


IN WITNESS WHEREOF,
the undersigned parties hereby agree to this Amendment as of the dates set
forth below.


 


	
   

  	
  PACIFICARE OF CALIFORNIA,

  
	
   

  	
  A California corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Brian Jeffrey

  	
   

  
	
   

  	
  Name:

  	
  Brian Jeffrey

  
	
   

  	
  Title:

  	
  Vice President, Network Management

  
	
   

  	
  Date:

  	
   

  	
  12/7/01

  	
   

  
						



 


3

















 


	
   

  	
  PROSPECT HEALTH SOURCE MEDICAL

  
	
   

  	
  GROUP

  
	
   

  	
  A California professional corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter G. Goll

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Peter G. Goll

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12-5-01

  	
   

  
							



 


4

















 


PRODUCT
ATTACHMENT A


PACIFICARE
COMMERCIAL HEALTH PLAN


 


This Product
Attachment A, along with the Base Agreement, sets forth the specific terms and
conditions which are applicable to the PacifiCare Commercial Health Plan, as
defined below.


 


ARTICLE 1


DEFINITIONS


 


The following
terms shall have the meaning attributed below for purposes of the PacifiCare
Commercial Health Plan, as described in this Product Attachment A.  Capitalized terms not otherwise defined
herein shall have the meaning assigned to them in the Base Agreement.


 


1.1                                 OPM
Agreement is the agreement between PacifiCare and the Federal Office of
Personnel Management for the provision of Covered Services to persons enrolled
in the PacifiCare Commercial Plan through their participation in the health
benefits programs for federal employees and their dependents.


 


1.2                                 Commercial
Plan Premium is the premium received by PacifiCare each month for
PacifiCare Commercial Plan Members, excluding amounts to pay broker and agent
commissions/compensation, Premium taxes and premiums for Supplemental Benefits.


 


1.3                                 PacifiCare
Commercial Plan is any and all of the various Managed Care Plans sold by
PacifiCare to individuals (excluding individuals eligible for the PacifiCare
Medicaid Plan and the Secure Horizons Health Plan) and employer groups,
associations with employer group participation and unions, which purchase
benefits for their employees and their dependents.


 


1.4                                 Commercial
Plan Members are Medical Group Members enrolled in the PacifiCare
Commercial Plan.


 


1.5                                 Supplemental
Benefits are benefits offered under the PacifiCare Commercial Plan which
require separate premium, in addition to the Commercial Plan Premium, as
consideration for the additional benefits.


 


ARTICLE 2


DUTIES OF MEDICAL GROUP


 


2.1                                 Provision
of Covered Services.  Medical Group
and its Participating Providers shall provide Covered Services to Commercial
Plan Members pursuant to the terms of the Base Agreement and this Product
Attachment A.


 


2.2                                 Compliance
with OPM Agreement.  Medical Group
shall comply with all requirements in the OPM Agreement, which are applicable
to Medical Group as a subcontractor of PacifiCare as a result of this
Agreement.  Without limiting the
foregoing, Medical Group shall ensure that all


 


5

















 


provisions of
the OPM Agreement, which are applicable to Medical Group’s Participating
Providers are included in Medical Group’s subcontracts with its Participating
Providers.  A copy of the OPM Agreement
shall be provided to Medical Group concurrent with the execution of this
Agreement.


 


2.3                                 Compliance
with Subscriber Agreements for PacifiCare Commercial Plan. Medical Group
and its Participating Providers shall comply with all requirements in
Subscriber Agreements for the PacifiCare Commercial Plan, which are applicable
to Medical Group.  PacifiCare shall make
good faith efforts to notify Medical Group of any such requirements that are
not otherwise reflected in this Agreement.


 


ARTICLE 3


COMPENSATION


 


3.1                                 Age/Gender/Benefit
Adjusted Commercial Capitation. Capitation Payments to Medical Group for
Commercial Plan Members shall be made based upon a per Member per month base
capitation rate (“Base Capitation Rate”) adjusted to reflect the Medical Group
Members’ age, gender, and benefit plan participation.  The Base Capitation Rate shall be *** per Commercial Plan Member
per month.  For the month of January 2002,
the base capitation using the November 2001 membership demographics, shall
yield *** per member per month. 
Age/gender adjustment factors are actuarially determined and are listed
below.  Benefit adjustment factors are
actuarially determined and may take into consideration variations in benefit
plan types, copay and coinsurance levels. 
PacifiCare may change its benefit adjustment factors as needed to
support the differing plan types that it offers.  On an annual basis, PacifiCare may modify the benefit adjustment
factors based on actuarially determined changes.  The average capitation rate will vary during subsequent months as
a result of changes in the age, gender, and benefit plan participation of the
Medical Group’s Members for the applicable month.  The total monthly Capitation Payment shall also be adjusted in
the manner set forth in Article 5 of the Base Agreement.


 


The following
are PacifiCare’s age/gender adjustment factors:


 


	
  Child 0

  	
   

  	
  1.9939

  	
   

  
	
  Child 1

  	
   

  	
  1.2664

  	
   

  
	
  Child 2 - 9

  	
   

  	
  0.4730

  	
   

  
	
  Child 10 – 17

  	
   

  	
  0.4375

  	
   

  
	
  Female 18 – 19

  	
   

  	
  0.7395

  	
   

  
	
  Female 20 – 24

  	
   

  	
  1.4564

  	
   

  
	
  Female 25 – 29

  	
   

  	
  1.6593

  	
   

  
	
  Female 30 – 34

  	
   

  	
  1.4785

  	
   

  
	
  Female 35 – 39

  	
   

  	
  1.2495

  	
   

  
	
  Female 40 – 44

  	
   

  	
  1.3095

  	
   

  
	
  Female 45 – 49

  	
   

  	
  1.2221

  	
   

  
	
  Female 50 – 54

  	
   

  	
  1.5869

  	
   

  
	
  Female 55 – 59

  	
   

  	
  1.7404

  	
   

  



 


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  Female 60 – 64

  	
   

  	
  2.0135

  	
   

  
	
  Female 65 plus

  	
   

  	
  2.0630

  	
   

  
	
  Male 18 – 19

  	
   

  	
  0.3554

  	
   

  
	
  Male 20 – 24

  	
   

  	
  0.4774

  	
   

  
	
  Male 25 – 29

  	
   

  	
  0.5702

  	
   

  
	
  Male 30 – 34

  	
   

  	
  0.6033

  	
   

  
	
  Male 35 – 39

  	
   

  	
  0.7038

  	
   

  
	
  Male 40 – 44

  	
   

  	
  0.7700

  	
   

  
	
  Male 45 – 49

  	
   

  	
  0.8742

  	
   

  
	
  Male 50 – 54

  	
   

  	
  1.3235

  	
   

  
	
  Male 55 – 59

  	
   

  	
  1.7024

  	
   

  
	
  Male 60 – 64

  	
   

  	
  2.2284

  	
   

  
	
  Male 65 plus

  	
   

  	
  2.3563

  	
   

  



 


3.1.1                        Adjustment for ISL Premium.  In calculating Capitation
Payments due to Medical Group, PacifiCare shall deduct the ISL Premium amount
set forth herein from the amounts otherwise due to Medical Group, unless
PacifiCare has approved of Medical Group’s opting out of PacifiCare’s ISL
Program.


 


3.1.2                        Adjustment for Experience-Rated Managed Care Plans. Capitation Payments for Experience Rated
Plans shall be calculated utilizing the following definitions and methodology:


 


(i)                                     An “Experience-Rated Plan” is a
non-federally-qualified plan in which the Subscriber Group’s premium is
partially deferred or adjusted to reflect the actual medical costs incurred by
Commercial Plan Members.


 


(ii)                                  The “Net Actuarial Experience Rate” shall mean a rate calculated by the
same method used to determine premium for federally-qualified plans, except
that trended claims and utilization data may be considered to determine
expected medical costs and PacifiCare’s administrative retention may be
adjusted to reflect actuarial risk taken by the Subscriber Group instead of
PacifiCare.


 


(iii)                               For Experience-Rated Plans, Capitation Payments shall be calculated as
a percent of the Net Actuarial Experience Rate rather than based on a percent
of the Commercial Plan Premium.  The Net
Actuarial Experience Rate, like the Commercial Plan Premium, shall exclude
broker and agent commissions, premium taxes and premiums for Supplemental
Benefits.


 


3.2                                 ISL Program. The ISL Deductible, ISL Premium and ISL Coinsurance for the Commercial
Plan shall initially be:


 


(i)                                     ISL Deductible shall be zero dollars and zero
cents ($0.00) per Commercial Plan Member per calendar year.


 


7

















 


(ii)                                  ISL Premium shall be zero dollars and zero cents ($0.00) per Commercial
Plan Member per month.


 


(iii)                               ISL Coinsurance shall be zero percent (0%) of Cost of Care in excess of
the ISL Deductible.


 


If PacifiCare has approved of Medical Group’s
opt out of the ISL Program, the above amounts and percentages will reflect
“zero.” In such event, Medical Group shall be required to obtain ISL coverage
from a third-party insurance carrier in accordance with Section 5.6.5 of
the Base Agreement.


 


3.3                                 Commercial Hospital Incentive Program. PacifiCare shall establish and administer
an annual Commercial Hospital Incentive Program for the PacifiCare Commercial
Plan (the “CHIP”).  The CHIP is designed
to provide an incentive for the efficient and effective use of Hospital
Services, and shall be calculated utilizing the terms defined below.  All calculations for the CHIP shall be based
upon Commercial Plan Members, excluding Commercial POS Plan Members.


 


3.3.1                        Reinsurance Program. Claims under the Reinsurance Program shall
be valued at the Cost of Care as defined in this Agreement.  The Reinsurance Deductible, Reinsurance
Premium and Reinsurance Coinsurance for the Commercial Plan shall initially be:


 


(i)                                     Reinsurance Deductible
shall be
                    
dollars
(                )
per Commercial Plan Member per calendar
year.


 


(ii)                                  Reinsurance Premium shall be
                    
dollars
(                )
of Commercial Plan Premium.


 


(iii)                               Reinsurance Coinsurance shall
be fifty percent (50%) of the Cost of Care for amounts in excess of the
Reinsurance Deductible but less than two hundred fifty thousand dollars
($250,000) and twenty percent (20%) of the Cost of Care for amounts in excess
of two hundred fifty thousand dollars ($250,000).


 


3.3.2                        CHIP Budget.  The CHIP Budget for Commercial Plan Members
shall be *** flat per Member per month, excluding Commercial POS Plan Members,
less PacifiCare Commercial Plan Reinsurance Premium, if any, and is subject to
the adjustments set forth in Article 5 of the Base Agreement and the
adjustments further specified below.


 


3 3.3                        CHIP Expense.  CHIP Expense shall be equal to the sum of
the following:


 


(i)                                     Inpatient costs for
Hospital Services rendered to Commercial Plan Members, excluding Commercial POS
Plan Members, by Participating Providers, valued at the actual costs incurred
by PacifiCare; plus,


 


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(ii)                                  Other Hospital Services rendered to
Commercial Plan Members, excluding Commercial POS Plan Members, by
Participating Providers other than inpatient services, valued at actual costs
incurred by PacifiCare; plus,


 


(iii)                               The actual amount paid for Hospital Services
which are rendered by non-Participating Providers; minus,


 


(iv)                              Amounts paid by PacifiCare under the
Reinsurance Program, if any; minus


 


(v)                                 Any and all amounts received from third panties
for Hospital Services provided to Commercial Plan Members, excluding Commercial
POS Plan Members, through coordination of benefits, work-related accidents or
injuries, stop-loss and reinsurance payments and Member Copayments.


 


3.3.4                        CHIP Surplus.  In
the event the CHIP Expense is less than the CHIP Budget, the surplus shall be
allocated as follows:


 


*** to Medical Group


*** to PacifiCare


 


3.3.5                        CHIP Deficit. In the event the CHIP Expense is greater
than the CHIP Budget, the deficit shall be allocated as follows:


 


*** to Medical Group, limited to $1.50 per
Member per month


*** to PacifiCare


 


3.3.6                        Settlements and Reconciliation. 
Interim settlements and the final settlement and reconciliation of the
CHIP shall be performed by PacifiCare as provided in Article 5 of the Base
Agreement.


 


3.4                                 Commercial Health Plan Pharmacy Incentive and
Upside Sharing Programs.
PacifiCare shall establish and administer a Pharmacy Upside Sharing Program for
the 2002 calendar year and ongoing for the PacifiCare Commercial Health Plan
(the “PIP”).  The PIP is designed to
provide an incentive for the efficient and effective use of Outpatient Pharmacy
Supplemental Benefits for Commercial Health Plan Members.  PacifiCare shall provide Medical Group with
monthly reports on the PIP (no later than the twentieth (20th) calendar day
following the applicable month) which shall include data showing the applicable
Member, Participating Provider and pharmaceutical prescribed for the applicable
Member.  The PIP shall be calculated as
follows:


 


3.4.1                        Outpatient Pharmacy Supplemental Benefits shall be the benefits made available by
PacifiCare under the PacifiCare Supplemental Pharmacy Benefit, as defined in
the applicable Subscriber Agreement.


 


9

















 


3.4.2                        PIP Budget shall
equal eighty percent (80%) of the premium received by PacifiCare for Outpatient
Pharmacy Supplemental Benefits for Commercial Health Plan Members plus
thirty-one cents ($0.31) per Commercial Health Plan Member per month, which
amount is established as a credit for rebates received annually from
pharmaceutical manufacturers.  This
credit may or may not reflect the total pharmaceutical manufacturer rebate
revenues received by PacifiCare.  The
PIP Budget shall be retained by PacifiCare for purposes of administering the
PIP.


 


3.4.3                        PIP Expense shall
equal the expense incurred for the provision of Outpatient Pharmacy
Supplemental Benefits during the applicable period.


 


3.4.4                        PIP Surplus. In the
event the PIP Expense is less that the PIP Budget, Fifty percent (50%) of the
surplus shall be allocated to the Medical Group.


 


3.4.5                        PIP Deficit. In the
event that the PIP Expense is greater that the PIP Budget, Fifty Percent of the
deficit shall be allocated to the Medical Group not to exceed One Dollar
($1.00) per Commercial Plan Member per Month.


 


IN WITNESS WHEREOF, the parties hereto have executed this Product
Attachment A.


 


 


	
   

  	
  PACIFICARE OF CALIFORNIA

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Jeffrey

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12/7/01

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PROSPECT HEALTH SOURCE MEDICAL

  GROUP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter G. Goll

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12-5-01

  	
   

  
					



 


10

















 


PRODUCT ATTACHMENT B


 


PACIFICARE COMMERCIAL POINT-OF-SERVICE PLAN


 


This Product Attachment B, along with Product
Attachment A and the Base Agreement, sets forth the terms and conditions which
are applicable to the PacifiCare Commercial Point-of-Service Plan, as defined
below.


 


ARTICLE 1


DEFINITIONS


 


The following terms shall have the meaning attributed
below for purposes of the PacifiCare Commercial Point-of-Service Plan, as
described in this Product Attachment B. 
Capitalized terms not otherwise defined herein shall have the meaning
assigned to them in the Base Agreement.


 


1.1                                 Commercial Plan Premium is the premium received by PacifiCare each
month for PacifiCare Commercial Plan Members, excluding amounts to pay broker
and agent commissions/compensation, Premium taxes and premiums for Supplemental
Benefits.


 


1.2                                 In-Network Services are Covered Services received by Commercial
POS Plan Members which are (a) provided or arranged by Medical Group pursuant
to the PacifiCare Commercial Plan; (b) received from a non-contracting Provider
following an authorization from Medical Group; (c) Emergency Services; and (d)
Urgently Needed Services.


 


1.3                                 In-Network Hospital Services are Hospital Services received by Commercial
POS Plan Members which are (a) provided or arranged by Medical Group pursuant
to the PacifiCare Commercial Plan; (b) received from a non-contracting Provider
following an authorization from Medical Group: (c) Emergency Services; and (d)
Urgently Needed Services.


 


1.4                                 Out-of-Network Services are Covered Services, excluding Emergency
Services and Urgently Needed Services, which are received by Commercial POS
Plan Members without the prior authorization of Medical Group.


 


1.5                                 PacifiCare Commercial Point-of-Service
(“POS”) Plan is any
PacifiCare Commercial Plan, as defined in Product Attachment A, under which
Members are entitled to coverage for both In-Network Services and
Out-of-Network Services.


 


1.6                                 Commercial POS Plan Members are Medical Group Members enrolled in the
PacifiCare Commercial POS Plan.


 


1.7                                 POS Plan Premium is the sum of the In-Network Premium and the
Out-of-Network Premium, as defined below:


 


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1.7.1                        In-Network Premium
is the Commercial Plan Premium, as defined in Product Attachment B, billed or
accounted for by PacifiCare for coverage of In-Network Services under the
PacifiCare Commercial POS Plan.


 


1.7.2                        Out-of-Network Premium
is the Commercial Plan Premium, as defined in Product Attachment A, billed or
accounted for by PacifiCare (or an insurance company or self-insured employer
which has assumed the risk for the Out-of-Network Services), for coverage of
Out-of-Network Services under the PacifiCare Commercial POS Plan.


 


ARTICLE 2


DUTIES
OF MEDICAL GROUP


 


2.1                                 Covered
Services. Medical Group and its Participating Providers shall provide or
arrange Covered Services to Commercial POS Plan Members under same terms and
conditions as Commercial Plan Members.


 


2.2                                 Reciprocity:
Reimbursement for Out-of-Network Services. If any of Medical Group’s
Participating Providers provides Out-of-Network Services to a Commercial POS
Plan Member, such Medical Group Participating Provider shall bill PacifiCare or
the payor responsible for payment for Out-of-Network Services for such services
and agrees to accept full payment at the Cost of Care.  Neither Medical Group nor its Participating
Providers shall encourage Members to receive Covered Services from
non-Participating Providers.  Medical
Group shall include the requirements of this Section in all subcontracts
with its Participating Providers.


 


ARTICLE 3


COMPENSATION


 


3.1                                 Capitation
Payments for Commercial POS Plan Members. 
For Commercial POS Plan Members, PacifiCare will pay Medical Group ***
of the Capitation Payment for Commercial Plan Members, subject to the
adjustments set forth in Article 5 of the Base Agreement and the adjustments
set forth below in this Section. 
Capitation Payments for Commercial POS Plan Members will be based on a
percentage of the In-Network Premium only. 
The payment described in this Section is payment in full for
In-Network Services, except for Copayments, coordination of benefits, third
party recoveries and payments under the PacifiCare POS Control Program set
forth below.


 


3.1.1                        Premium
Adjustments. The Commercial Plan Premium and benefits may be amended for
each Subscriber Agreement upon the annual renewal date of each Subscriber
Agreement at the sole discretion of PacifiCare.


 


3.1.2                        Adjustment for
ISL Premium.  In calculating
Capitation Payments due to the Medical Group for Commercial POS Plan Members,
PacifiCare shall deduct *** the ISL Premium amount set forth in Section 3.2
of Product Attachment A from the amounts otherwise due to Medical Group, unless
PacifiCare has approved of Medical Group’s opt out of PacifiCare’s ISL Program.


 


12

















 


3.2                                 Commercial POS Control Program. PacifiCare shall establish and administer
an annual Control Program for the PacifiCare Commercial Point-of-Service Plan
(“Commercial POS Control Program”).  The
Commercial POS Control Program is designed to provide an incentive for the
efficient and effective use of In-Network Hospital Services and to control
Out-of-Network Services, and shall be calculated in accordance with the
following provisions.


 


3.2.1                        Definitions. The
following terms shall have the meaning attributed below for purposes of the
Commercial POS Control Program.


 


(i)                                     POS Plan Budget shall equal the CHIP Budget, plus the POS
Capitation Withhold, plus *** of the Out-of-Network Premium, less PacifiCare
POS Control Program Reinsurance Premium, if any.


 


(ii)                                  POS Plan Costs shall
mean the following:


 


(a)          Claims paid for In-Network Hospital Services
incurred during the current period, calculated at the actual amount paid; plus,


 


(b)         Claims paid for Out-of-Network
Services incurred during the current period, calculated at the actual amount
paid; plus,


 


(c)          Claims paid for In-Network
Hospital Services and Out-of-Network Services incurred but not included in
prior period Commercial POS Control Program calculations, calculated at the
actual amount paid; minus,


 


(d)         Any and all amounts received
from third party liability and coordination of benefit recoveries for
In-Network Hospital Services and Out-of-Network Services that are received
during the period of calculation.


 


(iii)                               Budget
Surplus. The amount, if any, by which the POS Plan Budget exceeds the POS
Plan Costs for any calendar year.


 


(iv)                              Budget
Deficit. The amount, if any, by which the POS Plan Costs exceeds the POS
Plan Budget for any calendar year.


 


(v)                                 Capitation
Restoration Amount. The difference between (a) the amount Medical Group
would have received if Medical Group’s Capitation Payments for Commercial POS
Plan Members had been determined by multiplying the percentage set forth in
Section 3.1 of Product Attachment A by the In-Network Premium and (b)
the actual capitation paid to Medical Group for Commercial POS Plan Members for
the relevant contract year.


 


3.2.2                        POS Control
Program Reinsurance. Unless PacifiCare has approved of Medical Group’s opt
out of POS reinsurance (“POS Control Program Reinsurance”), PacifiCare


 


13

















 


shall provide reinsurance (the “Commercial
POS Control Program Reinsurance”) in order to provide protection for the
Commercial POS Plan Budget when Cost of Care for POS In-Network Hospital
Services and Out-of-Network Medical Group and Hospital Services
(“Out-of-Network Services”) exceeds a specified dollar amount per Medical Group
Member per calendar year (the “Commercial POS Control Program Reinsurance
Deductible”).  Costs for In-Network
Hospital Services and Out-of-Network Services that exceed the Commercial POS
Control Program Reinsurance Deductible shall be considered an expense against
the Commercial POS Plan Budget, of which surpluses and deficits are shared
between PacifiCare and Medical Group as noted below.


 


3.2.3                        Reinsurance Program.
Claims under the POS Control Program Reinsurance shall be valued at one
thousand five hundred dollars ($1,500) per acute inpatient day, four hundred
dollars ($400) per skilled nursing facility day, and zero dollars ($0) for all
other claims. The Reinsurance Deductible and Reinsurance Premium for the
Commercial POS Plan shall initially be:


 


(i)                                     Reinsurance Deductible shall be
                   
(               )
per Commercial Plan Member per calendar year.


 


(ii)                                  In-Network Reinsurance Premium shall be
                   
(               )
of the Commercial Plan Reinsurance Premium amount set forth in
Section 3.3.1 of Product Attachment A.


 


(iii)                               Out-of-Network
Reinsurance Premium shall be                    
(               )
of the Commercial Plan Reinsurance Premium amount set forth in
Section 3.3.1 of Product Attachment A.


 


If PacifiCare
has approved of Medical Group’s opt out of the Reinsurance Program, the above
amounts and percentages will reflect “zero.” In such event, Medical Group shall
be required to obtain reinsurance coverage from a third-party insurance carrier
in accordance with Section 5.6.5 of the Base Agreement.


 


3 2.4                        Documentation.  PacifiCare shall provide Medical Group with
a list of In-Network Hospital Services claim payments and Out-of-Network claim
payments in support of computation and accuracy of POS Plan Costs, third party
liability and coordination of benefit recoveries, assumptions and data
supporting the POS Plan Budget, the Budget Surplus, and the Budget Deficit and
the Capitation Restoration Amount.


 


3.2.5                        Budget Surplus
Reconciliation.  Medical Group shall
receive one hundred percent (100%) of the Budget Surplus, until such time as
Medical Group has received the applicable Capitation Restoration Amount. If the
Budget Surplus exceeds the Capitation Restoration Amount, then PacifiCare and
Medical Group shall each be entitled to fifty percent (50%) of the remaining
Budget Surplus.


 


14

















 


3.2.6                        Budget Deficit Reconciliation.  In the event of a Budget
Deficit, Medical Group shall not be responsible for making any payments under
the PacifiCare POS Control Program. 
However, fifty percent (50%) of the Budget Deficit amount shall be
considered a Medical Group obligation for purposes of offsetting surpluses
under other incentive programs under the Agreement.


 


3.3                                 Adjustment of Rates. Capitation Payments for Commercial POS Plan
Members and the POS Plan Budget may be prospectively adjusted on an annual
basis to reflect actual experience under the Commercial POS Plan; provided,
however, that in no event shall the amount of any increase or decrease to such
Capitation Payments be greater than ten (10) percentage points in any
given year.


 


IN WITNESS WHEREOF, the parties hereto have executed
this Product Attachment B.


 


 


	
   

  	
  PACIFICARE OF CALIFORNIA

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Jeffrey

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12/7/01

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PROSPECT HEALTH SOURCE MEDICAL
  GROUP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter G. Goll

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12-5-01

  	
   

  
					



 


15

















 


PRODUCT ATTACHMENT C


 


SECURE HORIZONS HEALTH PLAN


 


This Product Attachment C, along with the
Base Agreement, sets forth the terms and conditions which are applicable to the
Secure Horizons Health Plan, as defined below.


 


ARTICLE 1


DEFINITIONS


 


The following terms shall have the meaning
attributed below for purposes of the Secure Horizons Health Plan, as described
in this Product Attachment C. Capitalized terms not otherwise defined herein
shall have the meaning assigned to them in the Base Agreement.


 


1.1                                 HCFA is the Health Care Financing Administration, an administrative agency
of the United States Government, responsible for administering the Medicare
program.


 


1.2                                 HCFA
Agreement is the Medicare + Choice contract between PacifiCare and HCFA.


 


1.3                                 Medicare
is the Hospital Insurance Plan (Part A) and the Supplementary Medical Insurance
Plan (Pan B) provided under Title XVIII of the Social Security Act, as amended.


 


1.4                                 Monthly
HCFA Payment is the revenue received by PacifiCare each month from HCFA, as
determined by HCFA, for providing Covered Services to Secure Horizons Members.


 


1.5                                 Secure
Horizons Health Plan is the prepaid health plan operated by PacifiCare
pursuant to the HCFA Agreement, which provides Covered Services to individuals
(including retirees) eligible to receive Medicare benefits.


 


1.6                                 Secure
Horizons Members are Medical Group Members enrolled in the Secure Horizons
Health Plan.


 


1.7                                 Secure
Horizons Revenue is the Monthly HCFA Payment for Medical Group Members
enrolled in the Secure Horizons Health Plan, less payments for broker
and agent commissions/compensation (when applicable), premium taxes and amounts
used to fund the Market Specific Benefit Program (as defined below).


 


ARTICLE 2


DUTIES
OF MEDICAL GROUP


 


2.l                                    Compliance
with HCFA Agreement and Federal Medicare Law.  Medical Group shall comply with all requirements in the HCFA
Agreement, which are applicable to Medical Group as a subcontractor of
PacifiCare as a result of this Agreement. Without limiting the foregoing,
Medical Group shall ensure that all provisions of the HCFA Agreement, which are
applicable


 


16

















 


to Medical
Group’s Participating Providers as a subcontractor of PacifiCare are included
in Medical Group’s subcontracts with its Participating Providers.  A copy of the HCFA Agreement shall be made
available to Medical Group concurrent with the execution of this Agreement.  Medical Group and its Participating Providers
shall comply with Title XVIII of the Social Security Act and the regulations
adopted thereunder by HCFA for the Medicare program.


 


2.2                                 Medicare
Participation Standards. Medical Group shall require that all of its
Participating Providers who provide services to Secure Horizons Members meet
the standards for participation and all applicable requirements for providers
of health care services under the Medicare program.  In addition, Medical Group shall require that all facilities and
offices utilized by Medical Group and its Participating Providers to provide or
arrange Covered Services to Secure Horizons Members shall comply with facility
standards established by HCFA.


 


2.3                                 Specific
Provisions Pertaining to Benefits, Coverage and Beneficiary Protections. Without
limiting any of Medical Group’s other obligations under this Agreement, Medical
Group specifically agrees to comply with the following policies and procedures:


 


(i)                                     PacifiCare’s
policies pertaining to the collection of Copayments which prohibit the collection
of Copayments for routine injections, routine immunizations, flu immunizations,
and the administration of pneumococcal/pneumonia vaccine.


 


(ii)                                  PacifiCare’s
policies pertaining to pre-certification which provide that Secure Horizons
Members may directly access a provider for mammography and influenza
vaccinations and women’s health specialists for routine and preventative health
care.


 


(iii)                               PacifiCare’s
policies pertaining to complex and serious conditions, which provide for
procedures to identify, assess and establish treatment plans for persons with
complex or serious medical conditions.


 


(iv)                              PacifiCare’s
policies pertaining to enrollment and assessment of new Secure Horizons Members
including requirements to conduct a health assessment of all new Secure
Horizons Members within ninety (90) days of the effective date of their
enrollment.


 


2.4                                 Confidentiality
of Medical Records. Medical Group shall establish and maintain procedures
and controls so that no information contained in its records or obtained from
HCFA or from others in carrying out the terms of this Agreement shall be used
by or disclosed by it, its agents, officers, or employees except as provided in
Section 1106 of the Social Security Act, as amended, and regulations
prescribed thereunder.


 


2.5                                 Submission
of Data. Medical Group shall cooperate with PacifiCare in submitting to the
Secretary of Health and Human Services statistical data pertaining to Covered
Services provided by Medical Group, enrollment and disenrollment data and any other
reports the Secretary may reasonably require to carry out its functions under
the Medicare + Choice


 


17

















 


program.


 


2.6                                 Advance Directives. Medical Group shall document all Secure
Horizons Member patient records with respect to the existence of an Advance
Directive in compliance with the Patient Self-Determination Act
(Section 4751 of the Omnibus Reconciliation Act of 1990), as amended, and
other appropriate laws.  For purposes of
this Agreement, an Advance Directive is a Member’s written instructions,
recognized under State law, relating to the provision of health care when the
Member is not competent to make health care decisions as determined under State
law.  Examples of Advance Directives are
living wills and durable powers of attorney for health care.


 


2.7                                 Non-Discrimination. Medical Group understands that HCFA
requires compliance with the provisions of this Section as a condition for
participation in the Secure Horizons Health Plan.  Medical Group and its Participating Providers shall not
unlawfully discriminate against any of their employees or applicants for
employment or against any Members on the basis of race, color, creed, national
origin, ancestry, religion, sex, marital status, age (except as provided by
law), sexual orientation, gender identity, or physical or mental handicap,
including HIV status.  Medical Group and
its Participating Providers shall ensure that the evaluation and treatment of
their employees and applicants for employment and of Members are free of such
discrimination.  Medical Group and its
Participating Providers shall comply with Title VI of the Civil Rights Act of
1964, as amended (42 U.S.C. Section 2000d et. seq.), Section 504 of
the Rehabilitation Act of 1973, as amended (29 U.S.C. Section 794) and the
regulations thereunder, Title IX of the Education Amendments of 1972, as
amended (20 U.S.C. Section 1681 et. seq.), the Age Discrimination Act of
1975, as amended (42 U.S.C. Section 6101 et. seq.), Section 654
of the Omnibus Budget Reconciliation Act of 1981, as amended (42 U.S.C.
Section 9849), the Americans With Disabilities Act (P.L. 101-365) and all
implementing regulations, guidelines and standards as are now or may be
lawfully adopted under the above statutes.


 


2.8                                 Termination of HCFA Agreement. In the event the HCFA Agreement is
terminated or not renewed, the provisions of this Agreement relating to the
Secure Horizons Health Plan shall automatically terminate unless otherwise
agreed by HCFA and PacifiCare.


 


ARTICLE 3


COMPENSATION


 


3.1                                 Capitation Payments for Secure Horizons
Members. Capitation Payments
for Secure Horizons Members shall be *** of the Secure Horizons Revenue per
Secure Horizons Member per month, plus *** for each Secure Horizons Member for
whom PacifiCare has received a monthly member premium, subject to the
adjustments set forth in Article 5 of the Base Agreement and the
adjustments set forth below in this Section.


 


3.1.1                        Adjustment for ISL Premium. In calculating Capitation Payments due to Medical Group, PacifiCare
shall deduct the ISL Premium amount set forth herein from the


 


18

















 


amounts
otherwise due to Medical Group, unless PacifiCare has approved of Medical
Group’s opting out of PacifiCare’s ISL Program.


 


3.2                                 ISL
Program. The ISL Deductible, ISL Premium and ISL Coinsurance for the Secure
Horizons Plan shall initially be:


 


(i)                                     ISL
Deductible shall be zero dollars and zero cents ($0.00) per Secure Horizons
Member per calendar year.


 


(ii)                                  ISL
Premium shall be zero percent (0%) of the Secure Horizons Revenue.


 


(iii)                               ISL
Coinsurance shall be zero percent (0%) of the Cost of Care in excess of the ISL
Deductible.


 


If PacifiCare
has approved of Medical Group’s opt out of the ISL Program, the above amounts
and percentages will reflect “zero.” In such event, Medical Group shall be
required to obtain ISL coverage from a third-party insurance carrier in
accordance with Section 5.6.5 of the Base Agreement.


 


3.3                                 Secure
Horizons Hospital Incentive Program. PacifiCare shall establish and
administer an annual Hospital Incentive Program for the Secure Horizons Health
Plan (the “SHIP”). The SHIP is designed to provide an incentive for the
efficient and effective use of Hospital Services, and shall be calculated
utilizing the terms defined below.


 


3.3.1                        Reinsurance
Program. Claims under the Reinsurance Program shall be valued at the Cost
of Care as defined in this Agreement. The Reinsurance Deductible, Reinsurance
Premium and Reinsurance Coinsurance for the Secure Horizons Plan shall
initially be:


 


(i)                                     Reinsurance
Deductible shall be
                 
(        ) per Secure Horizons Member
per calendar year.


 


(ii)                                  Reinsurance
Premium shall be
                 
percent (        %) of the Secure
Horizons Revenue.


 


(iii)                               Reinsurance
Coinsurance shall be fifty percent (50%) of the Cost of Care for amounts in
excess of the Reinsurance Deductible but less than two hundred fifty thousand
dollars ($250,000) and twenty percent (20%) of the Cost of Care for amounts in
excess of two hundred fifty thousand dollars ($250,000).


 


3.3.2                        SHIP Budget.
The SHIP Budget for Secure Horizons Members shall be fifty one percent (51.0%)
of the Secure Horizons Revenue per Secure Horizons Member per Month, subject to
the adjustments set forth in Article 5 of the Base Agreement and further
specified below, less PacifiCare Secure Horizons Plan Reinsurance Premium, if
any.


 


19

















 


3.3.3                        SHIP Expense.
SHIP Expense shall be equal to the sum of the following:


 


(i)                                     Inpatient
costs for Hospital Services rendered to Secure Horizons Members by
Participating Providers valued at the actual costs incurred by PacifiCare; plus,


 


(ii)                                  Other
Hospital Services rendered to Secure Horizons Members by Participating
Providers other than inpatient services, valued at actual costs incurred by
PacifiCare; plus,


 


(iii)                               The actual
amount paid for Hospital Services, which are rendered by non-Participating
Providers; minus,


 


(iv)                              Amounts
paid by PacifiCare under the Reinsurance Program, if any; minus,


 


(v)                                 Any and
all amounts received from third parties for Hospital Services provided to
Secure Horizons Members through coordination of benefits, work-related
accidents or injuries, stop-loss and reinsurance payments and Medical Group
Member Copayments.


 


3.3.4                        SHIP Surplus.
In the event the SHIP Expense is less than the SHIP Budget, the surplus shall
be allocated as follows:


 


*** to Medical
Group


*** to
PacifiCare


 


3.3.5                        SHIP Deficit.  In the event the SHIP Expense is greater
than the SHIP Budget, the deficit shall be allocated as follows:


 


*** to Medical
Group,


*** to
PacifiCare


 


3.3.6                        Settlements
and Reconciliation.  Interim
settlements and the final settlement and reconciliation of the SHIP shall be
performed by PacifiCare as provided in Article 5 of the Base Agreement.


 


3.4                                 Market-Specific
Benefit Program.  PacifiCare may
establish, at its sole discretion, an annual Market-Specific Benefit Program
(the “MSBP”). The MSBP is designed to provide an incentive to control costs for
certain additional benefits (the “MSBP Benefits”) offered to Secure Horizons
Members, as defined in the applicable Subscriber Agreement, for the purpose of
enhancing the marketability of the Secure Horizons Health Plan. The MSBP may
include the following additional benefits and may be amended from time to time
by PacifiCare to reflect changes in the benefits:


 


Dental Benefits


Immunosuppressive Drugs


 


20

















 


Outpatient
Pharmacy Benefits


Respite Care


 


PacifiCare shall
retain *** of the Monthly HCFA Payment (the “MSBP Budget”) and add to it ***
per Secure Horizons Plan Member per month, which amount is established as a
credit for rebates received from pharmaceutical manufacturers. This credit may
or may not reflect the total pharmaceutical manufacturer rebate revenues
received by PacifiCare for purposes of funding and administering the MSBP. The
MSBP shall be calculated as follows:


 


3.4.1                        MSBP Benefits
shall be the additional benefits listed above in this Section and made
available under the Secure Horizons Health Plan as defined in the applicable
Subscriber Agreement.


 


3.4.2                        MSBP Expense
shall equal the expense incurred for the provision of MSBP Benefits during the
applicable period.


 


3.4.3                        MSBP Surplus.
In the event the MSBP Expense is less than the MSBP Budget, fifty percent (50%)
of the surplus shall be allocated to Medical Group.


 


3.4.4                        MSBP Deficit.  In the event the MSBP Expense is greater
than the MSBP Budget, fifty percent (50%) of the deficit shall be allocated to
Medical Group, not to exceed Two Dollars ($2.00) per member per month.


 


3.4.5                        Settlements.  The calculations in this Section and
settlements shall be performed in accordance with the procedures specified in
Article 5 of the Base Agreement.


 


3.5                                 Collection
of Charges From Third Parties When Medicare Is Not the Primary Payor.  Medical Group shall accept Capitation
Payments from PacifiCare as payment in full for Covered Services provided to
Secure Horizons Members; provided, however, when Medicare is not the primary
payor for Covered Services, such as when the Secure Horizons Member is entitled
to payment from another third party or for payment for a workers’ compensation
claim, or from other primary insurance coverage maintained by Secure Horizons
Member, Medical Group shall make no demand upon PacifiCare for reimbursement
under the Individual Stop-Loss Program until all primary sources of payment
have been pursued and it is determined that full payment cannot be obtained
within ten (10) months from the date of the provision of Covered Services.


 


21

















 


IN WITNESS WHEREOF, the parties hereto have executed this Product
Attachment C.


 


 


	
   

  	
  PACIFICARE OF CALIFORNIA

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Jeffrey

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12/7/01

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PROSPECT HEALTH SOURCE MEDICAL
  GROUP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter G. Goll

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  12-5-01

  	
   

  
					



 


22

















 


PACIFICARE
OF CALIFORNIA


 


MEDICAL GROUP/IPA SERVICES AGREEMENT


(PROFESSIONAL CAPITATION)


 


DIVISION
OF FINANCIAL RESPONSIBILITY


 


(This
Exhibit is an integral part of this Agreement)


 


The following matrix outlines the division of financial responsibility
between PacifiCare, Medical Group and the Hospital Incentive Program, the
intent being to clarify Covered Services categories in order to provide for
accurate administration. The matrix serves as a model under which broad Covered
Service categories suggest the appropriate financial responsibility for Covered
Services not specifically listed. The applicable Subscriber Agreement and
Evidence of Coverage should be consulted for an accurate and complete
description of Covered Services and the Provider Manual for administrative
clarification. Member benefit information should be verified prior to the
provision of services.


 


Division
of Financial Responsibility


 


KEY: M = Opt-out to
Medicare benefit for Hospice


 


	
  Service
  Description

  	
   

  	
  Medical

  Group

  	
   

  	
  Hospital

  Incentive

  Program

  	
   

  	
  PacifiCare

  	
   

  
	
  Allergy - Serum - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Allergy - Testing & Tx - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Ambulance (Air and Ground) - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Amniocentesis - OP - Fac &
  Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Anesthesiology - IP & OP -
  Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Autologous Blood Services - OP -
  Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Biofeedback (Medically
  Necessary) - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Detox) - IP A OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Detox) - IP
  & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - IP
  - Fac - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - IP
  - Fac - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - IP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - IP - Prof - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - OP - Fac - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - OP
  - Fac - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - OP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemical Dependency (Rehab) - OP
  - Prof - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemotherapy (Including Chemotherapy Drugs - Inject/Oral) - OP - Fac
  & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chemotherapy - IP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chiropractic - Medical - OP -
  Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Chiropractic - Supplemental - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Circumcision - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Diagnostic Tests - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  DME - IP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  DME, Ostomy/Colostomy Supplies, Prosthetics/Orthotics - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  



 


***      All references to the division of
financial responsibility have been deleted.


 


23

















 


KEY: M = Opt-out to
Medicare benefit for Hospice


 


	
  Service
  Description

  	
   

  	
  Medical

  Group

  	
   

  	
  Hospital

  Incentive

  Program

  	
   

  	
  PacifiCare

  	
   

  
	
  Emergency Room - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Emergency Room - OP - E.R. Phys.

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Endoscopic Studies - IP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Endoscopic Studies - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Endoscopic Studies - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Abortions - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Abortions - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Contraceptive Devices - Insertion - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Contraceptive Devices - Non-Rx (eg, Norplant/IUD) -
  OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Contraceptive Devices - Prescription - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - GIFT/ZIFT/IVF - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Infertility Procedures - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Infertility Procedures - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Infertility Testing - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Sterilization - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Sterilization - IP -Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Family Planning - Sterilization - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Fetal Monitoring - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Health Education - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Health Eval/Physical

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hearing Aids/Molds - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hearing Screening (Audiologic Evaluation) - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hemodialysis / Dialysis - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hemodialysis / Dialysis - OP - Fac (including all drugs)

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Home Health Care / Homebound Infusion Therapy - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hosp Based Phys Interpretative Serv Incl Radiology & Pathology - IP
  & OP -Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hospice Services (Medicare) - IP - Fac & Prof - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hospice Services - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Hospitalization Services - IP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Immunizations & Inoculations (Medically Necessary) - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Injectables - Not Part Of Outpatient Pharmacy Benefits - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Laboratory/Pathology (Diagnostic Only) - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Laboratory/Pathology (Diagnostic Only) - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Laboratory/Pathology - IP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Lithotripsy - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Lithotripsy - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Med/Surg Supplies (casts,
  splints, bandages) - Office - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Medication - Prescription - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health (Crisis
  Intervention) - OP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  MENTAL HEALTH: AB88 Benefits
  (Mental Health Parity applies to CO only)

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP & OP -
  Fac. CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP & OP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  MENTAL HEALTH: Secure Horizons and Commercial (non A88 Benefits)

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP and OP - Fac - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP and OP - Fac - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP and OP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  



 


***      All references to the division of
financial responsibility have been deleted.


 


24

















 


KEY: M = Opt-out to
Medicare benefit for Hospice


 


	
  Service
  Description

  	
   

  	
  Medical

  Group

  	
   

  	
  Hospital

  Incentive

  Program

  	
   

  	
  PacifiCare

  	
   

  
	
  Mental Health - IP and OP - Prof - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Mental Health - IP and OP - Prof- SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Observation Room - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Oral Surgery / Dental Services - Accident & Injury Only - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Oral Surgery / Dental Services - Accident & Injury Only - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Out of Area - IP & OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Out of Area - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Outpatient Surgery - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Outpatient Surgery - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Physician Services (All Professional Services) - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Prosthetics - Surgical Implants - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Radiation Therapy - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Radiation Therapy - OP - Fac and/ or freestanding facility

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Radiology (Diagnostic Only) - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Radiology (Diagnostic Only) - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Radiology - IP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Reconstructive Surgery - IP & OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Reconstructive Surgery - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Rehabilitation - Cardiac/OT/PT/RT/ST - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Rehabilitation - Cardiac/OT/PT/RT/ST - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Skilled Nursing Facility - IP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Sleep Studies - OP

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  TMJ - Evaluation (excludes dental exams/treatment) - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Transfusions - OP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Transplants - IP - Fac

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Transplants - IP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Urgent Care - OP - Fac & Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Vision - Medical Treatment - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Vision - Refraction for Contact Lenses/Frames - OP - Prof

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Vision Care Materials - Contact Lenses/Frames (non-cataract) - OP - CO

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
  Vision Care Materials - Contact Lenses/Frames (non-cataract) - OP - SH

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  	
  ***

  	
   

  



 


***      All references to the division of
financial responsibility have been deleted.


 


25