Exhibit
10.114


 


 


 


NOTICE AMENDMENT


Contract Amendments Required by


SB 260, AB 1455, AB 2907 and AB 1286


 


This Notice Amendment
supplements, amends, and is made a part of the agreement (“Agreement”)
presently in force between PacifiCare of California (“PacifiCare”) and
Professional Care Montebello (“Medical Group”).  This Notice Amendment applies to PacifiCare’s commercial Managed
Care Plans and is issued by PacifiCare in accordance with the provisions of the
Agreement which permit PacifiCare to issue notice amendments as necessary to
maintain compliance with changes in law, and this Notice Amendment does not
require the consent of Medical Group.


 


Recitals


 


WHEREAS, the California
legislature has enacted Senate Bill 260 (Speier) regarding financial standards and
requirements for “risk bearing organizations” that enter into “risk
arrangements” with health care service plans, the requirements of which are set
forth at Section 1375.4 of the California Health and Safety Code; and


 


WHEREAS, as a result of the
passage of SB 260 and the adoption of Section 1375.4, PacifiCare is
required to conform with the financial reporting requirements established by
the California Department of Managed Health Care that pertain to health care
service plans and risk bearing organizations, which requirements are set forth
at Title 28 of the California Code of Regulations, Sections 1300.75.4 through
1300.75.4.6; and


 


WHEREAS, the California
legislature has enacted Assembly Bill 1455 (Scott) regarding claims settlement
practices and dispute resolution mechanisms for health care service plans, the
requirements of which amend and supplement the Knox-Keene Health Care Service
Act of 1975; and


 


WHEREAS, as a result of the
passage of AB 1455, PacifiCare is required to conform with the requirements
established by the Department of Managed Health Care regarding claims
resolution practices and dispute resolution mechanisms, which requirements are
set forth at Title 28 of the California Code of Regulations, Sections 1300.71
and 1300.71.38; and


 


WHEREAS, the California
legislature has enacted Assembly Bill 2907 (Cohn) regarding amendments to
contracts between health care providers and health care service plans, which
supplement the Knox Knox-Keene Health Care Service Plan Act of 1975 by adding
Section 1375.7 to the California Health and Safety Code; and


 


WHEREAS, the California
legislature has enacted Assembly Bill 1286 (Frommer) regarding continuity of
care for newly enrolled health plan members affected by certain enumerated
medical conditions whose existing providers do not participate in the newly
enrolled member’s health plan, and regarding continuity of care for individuals


 


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affected by such conditions whose
providers are leaving a health plan’s provider network, the provisions of which
amend and supplement Section 1373.96 and other sections of the Knox-Keene
Health Care Service Plan Act of 1975; and


 


WHEREAS, the Agreement permits
PacifiCare to amend the Agreement in order to maintain compliance with State
and Federal Law by giving notice of such amendment to Medical Group;


 


NOW, THEREFORE, PacifiCare
hereby amends the Provider Agreement as follows:


 


Amendment


 


Article I


SB 260 REGULATIONS


(FINANCIAL SOLVENCY)


 


1.                                       Definitions.


 


1.1                      “IBNR
Claims.” The term “IBNR Claims” shall refer to claims for services provided
to Members which are the financial responsibility of Medical Group, and which
have been incurred, but which have not been reported to Medical Group.


 


1.2                      “GAAP.”
The term “GAAP” shall mean generally accepted accounting principles,
consistently applied.


 


2.                                       Obligations
of Health Plan.


 


2.1                                 Monthly
Membership Reports. Notwithstanding any different provisions of the Agreement,
PacifiCare shall provide the following information to Medical Group on a
monthly basis for Members assigned to Medical Group within ten (10) calendar
days following the start of each month:


 


(a)                                  Membership
information containing the following elements:


 


(i)                                     Member
identification number;


(ii)                                  Name;


(iii)                               Birth
Date;


(iv)                              Gender;


(v)                                 Address
(including zip code);


(vi)                              Managed
Care Plan selected;


(vii)                           Employer
group identification;


(viii)                        Identity
of other third party coverage, if known;


(ix)                                Enrollment/disenrollment
dates;


 


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(x)                                   Medical
group/IPA number;


(xi)                                Provider
effective date;


(xii)                             Type
of change to coverage;


(xiii)                          Co-payment;


(xiv)                         Deductible;


(XV)                       Amount
of capitation to be paid per enrollee per month;


(xvi)                         Primary
care physicians, when selection is required by plan; and


 


(b)                                 The
following additional information:


 


(i)                                     Member
additions and terminations for the month (including: Member name, Member
identification number);


(ii)                                  Number
of additional Members under each Managed Care Plan;


(iii)                               Number
of deleted Members under each Managed Care Plan;


 


(c)                                  PacifiCare
shall submit all the information enumerated at Sections 2.1 (a) and (b) to
Medical Group electronically unless both PacifiCare and Medical Group agree in
writing that written reports may be submitted instead.


 


(d)                                 If the
information from Sections 2.1(a) and (b) are provided in more than one report,
all such reports shall be processed as of the same date.


 


(e)                                  Within
forty-five (45) calendar days of the close of each calendar quarter, PacifiCare
shall disclose to Medical Group through electronic transmission, or in writing
if agreed by both PacifiCare and Medical Group, a reconciliation of any
variances between the reports for information listed in Sections 2.1 (a) and
(b).


 


2.2                                 Quarterly
Risk-Sharing Reports. PacifiCare shall provide to Medical
Group on a quarterly basis, within forty-five (45) days of the close of each
calendar quarter, a quarterly risk-sharing report.  The risk sharing report shall contain a detailed description of
each and every amount (including expenses and income) that is sufficient to
allow verification of amounts allocated to Medical Group and PacifiCare under
the Agreement.  Where applicable, the
following information, at minimum, shall be provided in the quarterly
risk-sharing report:


 


(a)                                  Total
number of Member months;


 


(b)                                 Total
budget allocation for the Member months;


 


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(c)                                  Total
expenses paid during the period;


 


(d)                                 A
description of each and every amount of expense allocated to the PacifiCare and
to Medical Group by Member identification number, date of service, description
of service by claim codes, net payment, and date of payment.


 


2.3                                 Annual
Statement. PacifiCare shall provide Medical Group with a preliminary
payment report no later than one hundred fifty (150) days following the end of
the contract year consistent with the requirements of Section 2.2 and
provide payment, if any is due, to Medical Group no later than one hundred
eighty (180) days after the close of the contract year or the Agreement’s
termination date, whichever occurs first.


 


2.4                                 Annual
Disclosures. On the Agreement anniversary date, PacifiCare shall
disclose to Medical Group the following information for each and every type of
risk arrangement (traditional commercial, point of service, small group, and
individual plans), other than the Secure Horizons Health Plan, which may be
covered by the Agreement:


 


(a)                                  A
matrix of responsibility for medical expenses (physician, institutional,
ancillary, and pharmacy) which will be allocated to Medical Group, a facility
or PacifiCare under the Agreement;


 


(b)                                 Expected/projected
utilization rates and unit costs for each major expense service group
(inpatient, outpatient, primary care physician, specialist, pharmacy, home
health, durable medical equipment, ambulance, and other), as well as the source
of the data and the actuarial methods employed in determining the utilization
rates and unit costs by benefit plan type.


 


(c)                                  All
factors used to adjust payments or risk-sharing targets, including but not
limited to the following: age, sex, localized geographic area, family size,
experience rated, and benefit plan design, including copayment/deductible
levels;


 


(d)                                 The
amount of payment for each and every service to be provided under the contract,
including any fee schedules or other factors or units used in determining the
fees for each and every service.  To the
extent that reimbursement is made pursuant to a specified fee schedule, the
Agreement shall incorporate the fee schedule by reference, and shall
further specify the Medicare RBRVS year if RBRVS is the methodology used for
the fee schedule development.  For
any proprietary fee schedule, the Agreement


 


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shall include sufficient detail
that payment amounts related to that fee schedule can be accurately
predicted.


 


(e)                                  In the
case of Capitated Payment, PacifiCare shall disclose the amount to be paid per
Member per month and shall provide details sufficient to allow Medical Group to
verify the accuracy and appropriateness of any deductions from Capitation
Payments.


 


Article II


AB
1455 REGULATIONS

(CLAIMS PAYMENT and PROVIDER DISPUTES)


 


3.                                       Claims
Adjudication. In processing claims, Medical Group shall accept and
adjudicate claims for health care service provided to PacifiCare Members in
accordance with the provisions of Sections 1371, 1371.1, 1371.2, 1371.22,
1371.35, 1371.36, 1371.37, 1371.38, 1371.4, and 1371.8 of the California Health
and Safety Code and Sections 1300.71, 1300.71.38, 1300.71.4, and 1300.77.4 of
Title 28 of the California Code of Regulations.


 


4.                                       Quarterly
Performance Report. Medical Group shall submit a quarterly performance report
to PacifiCare within thirty (30) days of the close of each calendar quarter,
and during the term of this Agreement. 
Such report shall, at minimum, meet the following requirements:


 


4.1                                 The
report shall disclose
the percentage of claims paid timely and accurately by Medical Group consistent
with Sections 1371, 1371.1, 1371.2, 1371.22, 1371.35, 1371.36, 1371.37, 1371.4,
and 1371.8 of the California Health and Safety Code and Sections 1300.71,
1300.71.38, 1300.71.4 and 1300.77.4 of Title 28 of the California Code of
Regulations.


 


4.2                                 The
report shall include a tabulated record of each dispute received by Medical
Group from a provider, categorized by date of receipt, and shall include the
identification of each provider, describe the type of dispute, disposition of
each dispute, and state the number of working days for resolution of each such
dispute.  Each individual dispute
contained in a provider’s bundled notice of dispute shall be reported
separately.


 


4.3                                 The
report shall be signed by, and include the written verification of, a principal
officer of the Medical Group, as defined in Section 1300.45(o) of Title 28
of the California Code of Regulations. 
Such verification shall state that the report is true and correct to the
best knowledge and belief of such principal officer.


 


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5.                                       Provider
Dispute Resolution Mechanism.


 


5.1                                 Provider
Dispute Resolution Mechanisms. Medical Group shall establish and
maintain a fair, fast, and cost-effective dispute resolution mechanism to
process and resolve provider disputes in accordance with the provisions of Sections
1371, 1371.1, 1371.2, 1371.22, 1371.35, 1371.36, 1371.37, 1371.4, and 1371.8 of
the California Health and Safety Code and Sections 1300.71, 1300.71.38,
1300.71.4, and 1300.77.4 of Title 28 of the California Code of Regulations.  PacifiCare may assume responsibility for the
administration of Medical Group’s dispute resolution mechanism and for the
timely resolution of provider disputes in the event Medical Group fails to
timely resolve its provider disputes, including the issuance of a written decision.


 


5.2                                 Access
to Information. Medical Group shall make available to PacifiCare and to
the Department of Managed Health Care all records, notes, and documents
regarding Medical Group’s dispute resolution mechanism(s) and the resolution of
all disputes received from providers.


 


5.3                                 Disputes
Relating to Medical Necessity and Utilization Review. In
the event that a provider disagrees with the resolution of any dispute between
such provider and Medical Group which relates to medical necessity or
utilization review, such Medical Group shall have an unconditional right of
appeal for such claim to PacifiCare’s dispute resolution process for a de novo
review and resolution for a period of sixty (60) working days from Medical
Group’s date of determination, as defined at Section 1300.71 (a) of Title
28 of the California Code of Regulations, pursuant to the provisions of
Section 1300.71.38(a)(4) of Title 28 of the California Code of
Regulations.


 


6.                                       Waiver
Prohibited. Medical Group shall not require or permit a contracted
provider to waive any right conferred upon such provider or any obligation
imposed on PacifiCare by Sections 1371, 1371.1, 1371.2, 1371.22, 1371.35,
1371.36, 1371.37, 1371.4, and 1371.8 of the California Health and Safety Code
and Sections 1300.71, 1300.71,38, 1300.71.4, and 1300.77.4 of Title 28 of the
California Code of Regulations relating to claims processing or payment.  Any contractual provision or other agreement
purporting to constitute, create or result in such a waiver shall be null and
void.


 


Article III


AB 2907


(PROVIDER’S BILL OF RIGHTS)


 


7.                                       Amendments
or Modifications to Agreement. Except as otherwise provided in this
Article III, all amendments or modifications to the Agreement shall be
effective only upon mutual written agreement of the parties.


 


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8.                                       Amendments
to Provider Manual. PacifiCare may by notice amend or change any or all
provisions of the Provider Manual by providing forty-five (45) business days’
prior written notice to Medical Group unless the amendment is material and is
not made in order to comply with a change in State or Federal Law or
Accreditation Standard, in which case the provisions of Section 11 of this
Amendment, below, shall apply.  Any
notice amendment pursuant to the terms of this Section shall be binding
upon Medical Group at the end of the forty-five (45) business day period.


 


9.                                       Amendments
to Agreement to Comply with State and Federal Law.
PacifiCare may amend this Agreement by providing thirty (30) calendar days’
prior written notice to Medical Group in order to maintain compliance with
State and Federal Law.  Such amendment
shall be binding upon Medical Group at the end of the thirty (30) calendar day
period and shall not require the consent of Medical Group.


 


10.                                 Amendments
to Managed Care Plans. PacifiCare may by notice amend or
change any or all provisions of the Managed Care Plans by providing forty-five
(45) business days’ prior written notice to Medical Group unless the amendment
is material or it impacts Medical Group and is not made in order to comply with
a change in State or Federal Law or Accreditation Standard, in which case the
provisions of Section 11 of this Amendment, below.  Any notice amendment pursuant to the terms
of this Section shall be binding upon Medical Group at the end of the
forty-five (45) business day period and shall not require the consent of
Medical Group.


 


11.                                 Material
Changes. Medical Group and PacifiCare shall seek to agree to
amendments to the Agreement which satisfactorily address material changes
proposed by PacifiCare which are not permitted to be made by a notice amendment
pursuant to the terms of the Agreement or this Amendment or applicable State
and Federal Law.  In such event, the
applicable amendment shall not be effective until the parties amend the
Agreement through a written amendment signed by both parties.  For the purposes of this
Section “material” shall have the meaning set forth in California Health
and Safety Code Section 1375.7(f)(2), which at the time of execution of
this Agreement, states that “material” shall mean a change to which a
reasonable person would attach importance in determining action to be taken
upon such provision.


 


In the event PacifiCare has
provided Medical Group with notice of an amendment pursuant to Sections 8 or 10
of this Amendment, above, and such amendment is material and the parties are
not able to reach a mutual agreement on the terms of the amendment.  Medical Group retains its rights to terminate
the Agreement pursuant to California Health and Safety Code
Section 1375.7(b).  If Medical
Group desires to exercise its right to terminate the Agreement pursuant to
California Health and Safety Code Section 1375.7(b), Medical Group agrees
to


 


7

















 


provide PacifiCare with written
notice of its intent to terminate the Agreement not less than five (5) business
days prior to the expiration of the forty-five (45) business day notice period
provided at Sections 8 and 10 and Medical Group agrees that PacifiCare may
withdraw its notice amendment on or before the expiration of the forty-five
(45) business day notice period thereby canceling Medical Group’s termination
right.


 


Article IV


AB 1286


(CONTINUING CARE)


 


1.2                                 Definitions.


 


12.1                           ‘‘Acute
Condition” means a medical condition that involves a sudden onset of
symptoms due to an illness, injury, or other medical problem that requires
prompt medical attention and that has a limited duration.


 


12.2                           ‘‘Newborn
Child” means a newborn child between birth and age thirty-six (36) months.


 


12.3                           “New
Member” means a Member who has become newly enrolled with PacifiCare and
has been assigned to Medical Group.


 


12.4                           “Nonparticipating
Provider” means, with respect to a New Member, a licentiate, as defined in
Section 805 of the California Business and Professions Code, which is not
employed by or contracted with Medical Group for the provision of Covered
Services to Members, but who, at the time such New Member’s coverage with
PacifiCare became effective, was providing Covered Services for one of the
Special Circumstances.


 


12.5                           “Pregnancy”
means the three trimesters of pregnancy and the immediate postpartum period, “Pregnant”
shall refer to the state of Pregnancy.


 


12.6                           “Serious
Chronic Condition” refers to a medical condition due to a disease, illness,
or other medical problem or medical disorder that is serious in nature and that
persists without full cure or worsens over an extended period of time or
requires ongoing treatment to maintain remission or prevent deterioration.


 


12.7                           “Special
Circumstances” refers to an Acute Condition, Serious Chronic Condition,
Pregnancy, Terminal Illness, Newborn Care, or Surgery/Other Procedure.


 


12.8                           “Surgery/Other
Procedure” refers to a surgical or other procedure that is authorized by
PacifiCare as part of a documented course of treatment which has been
recommended and documented by a “provider,” as defined


 


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at Section 1345(i) of the
California Health and Safety Code, to occur within one hundred eighty (180)
days of the termination, nonrenewal or expiration of the Agreement between
PacifiCare and Medical Group or an agreement between Medical Group and one of
its Participating Providers or (in the case of a New Member) within one hundred
eighty (180) days of the effective date of coverage for such New Member.


 


12.9                           “Terminal
Illness” refers to an incurable or irreversible condition that has a high
probability or causing death within one (1) year or less, “Terminally Ill”
refers to the state of Terminal Illness.


 


12.10                     “Termination”
shall mean (i) the termination, expiration, or nonrenewal, or any circumstance
which results in the termination, expiration, or nonrenewal, of any arrangement
by which a Participating Provider provides Covered Services to Members, or (ii)
the termination, expiration, or nonrenewal, or any circumstance which results
in the termination, expiration, or nonrenewal, of the Agreement.


 


13.                                 General
Continuing Care Obligations of Provider. The provisions of this Article IV
shall amend only Medical Group’s obligations to continue to provide Covered
Services to Members in Special Circumstances. 
The provisions of this Article IV shall not modify Medical Group’s
general obligations to continue to provide Covered Services to Members, except
as necessary to modify Medical Group’s obligations to provide Covered Services
to Members in Special Circumstances. 
Notwithstanding the generality of the foregoing, all provisions of the
Agreement pertaining to (i) Medical Group’s general continuing care
obligations, (ii) Medical Group’s obligations to provide continuing care in the
event PacifiCare ceases operating or the Agreement is terminated for
nonpayment, (iii) the survival of all provisions of the Agreement pertaining to
Medical Group’s continuing care obligations, and (iv) Medical Group’s
obligation to provide services to Members transferred to Medical Group from a
terminated PacifiCare provider shall remain in full force and effect without
modification, except as necessary to modify Medical Group’s obligations to
provide Covered Services in Special Circumstances as set forth in this
Amendment.


 


14.                            Special
Circumstances Continuing Care Obligations.


 


14.1                           Termination
of Participating Provider. Following the Termination of any Participating
Provider, Medical Group shall, at the request of the applicable Member and in
accordance with PacifiCare’s policies and procedures, assure that such
Participating Provider shall provide Covered Services in Special Circumstances
as required by this Article IV.


 


14.2                           Termination
of the Agreement. Following the Termination of the Agreement, Medical Group
shall, at the request of the applicable Member and in accordance with
PacifiCare’s policies and procedures, assure that


 


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all of its Participating
Providers shall provide Covered Services in Special Circumstances to Members as
required by this Article IV.


 


14.3                           New
Members. Following the enrollment of a New Member into a PacifiCare
health plan, Medical Group shall, at the request of such New Member and in
accordance with PacifiCare’s policies and procedures, assure that the
applicable Nonparticipating Provider shall provide Covered Services in Special
Circumstances to New Members as required by this Article IV.


 


14.4                           Exceptions.


 


(a)                                  Terminated
Participating Providers. Medical Group is not obligated to
arrange for its terminated Participating Providers to provide Covered Services
in Special Circumstances to Members if the terminated Participating Provider
(i) was terminated for a medical disciplinary cause or reason, as defined in
paragraph (6) of subdivision (a) of Section 805 of the California Business
and Professions Code, or (ii) was terminated for fraud or other criminal
activity, (iii) does not agree to comply, or does not comply, with the same
contractual terms and conditions that were imposed upon such Participating
Provider prior to termination, including, but not limited to, credentialing,
hospital privileging, utilization review, peer review, and quality assurance
requirements, or (iv) has not agreed in advance to compensation terms for the
provision of Covered Services in Special Circumstances to Members, or does not
otherwise accept payment rates for such services, at rates (and methods of payment)
similar to those used by Medical Group for currently contracting providers
providing similar services who are not capitated and who are practicing in the
same or similar geographic area as the terminated Participating Provider.


 


(b)                                 Nonparticipating
Providers. Medical Group is not obligated to arrange for
Nonparticipating Providers to provide Covered Services in Special Circumstances
to New Members if the Nonparticipating
Provider (i) fails to agree in writing to be subject to the same contractual
terms and conditions that are imposed upon Medical Group’s currently contracted
participating providers providing similar services who are not capitated and
who are practicing in the same or a similar geographic region as the
Nonparticipating Provider, including, but not limited to, credentialing,
hospital privileging, utilization review, peer review, and quality assurance
requirements, or (ii) has not agreed in advance to compensation terms for the
provision of Covered Services in Special Circumstances to New Members, or does
not otherwise accept payment rates for such services, at rates (and


 


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methods of payment) similar to
those used by Medical Group for currently contracting providers providing
similar services who are not capitated and who are practicing in the same or a
similar geographic area as the Nonparticipating Provider.


 


14.5                           Time
Periods for the Provision of Covered Services in Special Circumstances.


 


(a)                                  Acute
Condition.


 


(i)                                     In the
case of a Member who has an Acute Condition, the Covered Services in Special
Circumstances shall be provided to the Member by Medical Group (in the event of
Termination of the Agreement), or by the terminated Participating Provider (in
the event of Termination of the Participating Provider), as the case may be,
for the duration of the Acute Condition.


 


(ii)                                  In the
case of a New Member who has an Acute Condition, Medical Group shall assure
that the Covered Services in Special Circumstances shall be provided by the
applicable Nonparticipating Provider for the duration of the Acute Condition.


 


(b)                                 Serious
Chronic Condition.


 


(i)                                     In the
case of a Member who has a Serious Chronic Condition, the Covered Services in
Special Circumstances shall be provided to the Member by Medical Group (in the
event of Termination of the Agreement), or by the terminated Participating
Provider (in the event of Termination of the Participating Provider), as the
case may be, for a period not to exceed twelve (12) months from the contract
Termination date.


 


(ii)                                  In the
case of a New Member who has a Serious Chronic Condition, Medical Group shall
assure that the Covered Services in Special Circumstances shall be provided to
the New Member by the applicable Nonparticipating Provider for a period not to
exceed twelve (12) months from the effective date of such New Member’s coverage
with PacifiCare.


 


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(c)                                  Pregnancy.


 


(i)                                     In the
case of a Member who is Pregnant, the Covered Services in Special Circumstances
shall be provided to the Member by Medical Group (in the event of Termination
of the Agreement), or by the terminated Participating Provider (in the event of
Termination of the Participating Provider), as the case may be, for the
duration of the Pregnancy.


 


(ii)                                  In the
case of a New Member who is Pregnant, Medical Group shall assure that the
Covered Services in Special Circumstances shall be provided to the New Member
by the applicable Nonparticipating Provider for the duration of the Pregnancy.


 


(d)                                 Terminal
Illness.


 


(i)                                     In the
case of a Member who is Terminally Ill, the Covered Services in Special
Circumstances shall be provided to the Member by Medical Group (in the event of
Termination of the Agreement), or by the terminated Participating Provider (in
the event of Termination of the Participating Provider), as the case may be,
for the duration of the Terminal Illness.


 


(ii)                                  In the
case of a New Member who is Terminally Ill, Medical Group shall assure that the
Covered Services in Special Circumstances shall be provided to the New Member
by the applicable Nonparticipating Provider for the duration of the Terminal
Illness.


 


(e)                                  Newborn
Child.


 


(i)                                     In the
case of a Newborn Child of a Member, the Covered Services in Special
Circumstances shall be provided to the Member’s Newborn Child by Medical Group
(in the event of Termination of the Agreement), or by the terminated
Participating Provider (in the event of Termination of the Participating
Provider), as the case may be, for a period not to exceed twelve (12) months
from the contract termination date.


 


(ii)                                  In the
case of a Newborn Child of a New Member, Medical Group shall assure that the
Covered Services in Special Circumstances shall be provided by the applicable
Nonparticipating Provider to the New Member’s Newborn Child for a period not to
exceed twelve (12) months from


 


12

















 


the effective date of such New
Member’s coverage with PacifiCare.


 


(f)                                    Surgery/Other
Procedure.


 


(i)                                     In the
case of a Surgery/Other Procedure, the Covered Services in Special
Circumstances shall be provided to the Member by Medical Group (in the event of
Termination of the Agreement), or by the terminated Participating Provider (in
the event of Termination of the Participating Provider), as the case may be.


 


(ii)                                  In the
case of a Surgery/Other Procedure for a New Member, Medical Group shall assure
that the Covered Services in Special Circumstances shall be provided to the New
Member by the applicable Nonparticipating Provider.


 


15.                                 Compensation
of Participating Providers. Medical Group shall be solely
responsible for compensating any terminated Participating Provider or
Nonparticipating Provider for the provision of Covered Services in Special
Circumstances to Members and New Members as agreed upon in writing between
Medical Group and the terminated Participating Provider or at the rate and
method of payment used by Medical Group for its contracting providers providing
similar services who are not capitated and who are practicing in the same or
similar geographic area as the terminated Participating Provider.


 


16.                                 Notifications
Regarding Termination. Medical Group shall provide ninety
(90) calendar days’ prior written notice to PacifiCare of the termination of
any of its Participating Providers (or such longer time as may be required by
the Agreement); provided, however, that if any Participating Provider is
terminated with less than ninety (90) calendar days’ notice, then Medical Group
shall provide written notice to PacifiCare within five (5) business days of
Medical Group becoming aware of such termination. Additionally, Medical Group
shall, and Medical Group shall cause the applicable Participating Provider to,
identify to ‘PacifiCare, in writing, any Members who (i) are receiving treatment
from such Participating Provider for an Acute Condition, Serious Chronic
Condition, Pregnancy, or Terminal Illness, (ii) have a Newborn Child, or (iii)
have been authorized to receive a Surgery/Other Procedure.


 


17.                                 Survival.
Medical Group agrees that (i) all of the provisions of this Article IV, as
well as all provisions of the Agreement which relate to Medical Group’s
obligation to provide continuing care to PacifiCare Members (even in the
absence of any Special Circumstances), shall survive termination of the
Agreement regardless of the cause giving rise to such termination, and (ii) all
such provisions shall be construed for the benefit of PacifiCare Members.


 


13

















 


Article V


GENERAL
PROVISIONS


 


18.                                 Applicability
of Amendment. This Amendment shall not apply to PacifiCare’s Secure
Horizons Medicare+Choice Health Plan.


 


19.                                 Effective
Date. This Amendment shall be effective on January 1, 2004.


 


20.                                 Construction
of Terms. Terms used and not otherwise defined in this Amendment
shall have the meanings assigned to them in the Agreement.


 


21.                                 Agreement
Remains Effective. Except as expressly modified by the terms of this
Amendment, all of the terms and conditions set forth in the Agreement shall
remain in full force and effect. No changes to Medical Group’s compensation
shall result from this Notice Amendment, nor shall any change in the division
of financial responsibility between PacifiCare and Medical Group for Covered
Services be deemed to occur by virtue of the issuance of this Notice Amendment.


 


22.                                 Conflicting
Terms. In the event that the terms or conditions of the Agreement
and this Amendment are in conflict, the terms of this Amendment shall control.


 


23.                                 Changes
in Law. PacifiCare acknowledges that (i) Governor Schwarzeneggar
has ordered a review of all administrative regulations adopted, amended, or
repealed since January 6, 1999, for the purpose of determining the
necessity, authority, clarity, consistency, reference and non-duplication of
such regulations, and that (ii) the California Healthcare Association has filed
a Petition for Writ of Mandate challenging certain provisions of the
regulations adopted by the Department of Managed Health Care at Title 28 of the
California Code of Administrative Regulations, Sections 1300.71 and
1300.71.38.  Accordingly, PacifiCare
reserves the right to amend any provision(s) of the Agreement or of this Notice
Amendment as reasonable in light of these reviews or any other changes in applicable
law or regulation.


 


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