Exhibit
10.137


 


	
  BLUE SHIELD OF CALIFORNIA

  	
  DEC [ILLEGIBLE] 1995

  
	
  HMO

  	
  PROSPECT MEDICAL GROUP

  
	
  IPA AGREEMENT

  	
   

  



 


This Agreement is made and entered into as of November 1, 1995 between California
Physicians’ Service, dba Blue Shield of California, a California nonprofit
corporation, licensed as a health care service plan, and Prospect Medical Group, Inc., referred to
herein as IPA, a legal entity comprised of individuals appropriately licensed
as providers of health care services in the State of California.


 


RECITALS


 


A.                                   Blue
Shield of California desires to make a comprehensive prepaid health maintenance
organization plan (BSC-HMO) available to its Members who select BSC-HMO.


 


B.                                     Blue
Shield of California desires to contract with IPA, an independent practice association
of physicians and other health care providers which desires to enter into a
service agreement with BSC-HMO to arrange for the provision of certain Benefits
in accordance with this Agreement and the BSC-HMO Health Services Contract.


 


C.                                     IPA is
eligible to be an HMO IPA as described in Paragraph B above.


 


D.                                    IPA
Physicians and Blue Shield of California currently have an agreement, entitled
“Physician Member Application and Agreement” under which individual IPA
Physicians have agreed to provide professional services to Blue Shield
Members.  That agreement shall remain in
effect for all Blue Shield Members other than BSC-HMO Members.  This BSC-HMO Agreement is not intended to
amend or otherwise effect the “Physician Member Application and Agreement” in any
manner.


 


I. DEFINITIONS


 


1.1                                 Terms
used throughout this Agreement are defined as fallows:


 


Agreement Year - a
period beginning at 12:01 a.m. on effective date of Agreement and ending at
12:01 a.m. the same date in the following year.


 


Authorization - the
procedure for obtaining the Plan’s prior approval for all services provided to
Members under the terms of their Health Services Contract other than Primary
Care Physician and Emergency services.


 


Benefits -
those health care services which a Member is entitled to receive pursuant to
the terms of their Health Services Contract.


 


Calendar Year - a
period beginning at 12:01 a.m. on January 1 and ending at 12:01 a.m. January 1
of the next year.


 


Capitated Services - all
Benefits set forth in Schedule A when covered in the Member’s Health Services
Contract.


 


Capitation Fees - the
amount prepaid by BSC-HMO to IPA in exchange for IPA’s obligation to render the
Benefits set forth in Schedule A.


 


Contractholder - that
entity to which the Health Services Contract is issued.


 


Copayment - an
amount which a Member is required to pay for certain Benefits.


 












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


 

















 


Dependent -


 


1.               a
Subscriber’s spouse who is not covered for Benefits as a Subscriber, is not
legally separated from the Subscriber, and is not a member of the Armed Forces;
and who has been enrolled and accepted by Plan as a dependent and has
maintained membership in accord with the Health Services Contract; or


 


2.               a
Subscriber’s unmarried child (including stepchild or legally adopted child) who
is primarily dependent upon the Subscriber for support and maintenance, is less
than 23 years of age, is not covered for Benefits as a Subscriber and is not a
member of the Armed Forces; and who has been enrolled and accepted by Plan as a
dependent and has maintained membership in accord with the Health Services
Contract.


 


Eligibility List - the
list of Members, determined by BSC-HMO to be eligible for Benefits, and for whom
Plan Providers are compensated.


 


Emergency -
medical condition means a medical condition manifesting itself by acute
symptoms of sufficient severity (including severe pain) such that the absence
of immediate medical attention could reasonably be expected to result in any of
the following:


 


(a)          placing the Member’s health in
serious jeopardy;


 


(b)         serious impairment to bodily
functions;


 


(c)          serious dysfunction of any bodily
organ or part.


 


Health Services
Contract (Contract) - the contract issued by Blue Shield to the
Contractholder that establishes the Benefits Members are entitled to receive
from the Plan.


 


Hospital -
either 1,2, 3, or 4 below:


 


1.               a
licensed and accredited health facility which is primarily engaged in providing
for compensation, medical, diagnostic and surgical facilities for the care and
treatment of sick and injured patients on an Inpatient basis, and which
provides such facilities under the supervision of a staff of Physicians and 24
hour a day nursing service by registered nurses.  A facility which is principally a rest home, nursing home or home
for the aged is not included; or


 


2.               a
psychiatric hospital licensed as a health facility and accredited by the Joint
Commission; or


 


3.               a
licensed health facility operated primarily for the treatment of alcoholism
and/or drug abuse accredited by the Joint Commission; or


 


4.               a
“psychiatric health facility” as defined in Section 1250.2 of the Health and
Safety Code.


 


Inpatient - a
patient admitted to a Hospital as a registered bed patient and who requires the
acute bed-patient (overnight) setting.


 


Institutional
Services - all Benefits provided that are not capitated or
out-of-area services.


 


IPA Provider - IPA
Physician or other provider appropriately licensed to provide health care
services who contracts with IPA to provide Benefits to Plan Members in
accordance with their Health Services Contract.


 


Medically
Necessary - Benefits are provided only for services which are medically
necessary.  Services which are medically
necessary include those which have been established as safe and effective and
are furnished in accordance with generally accepted professional standards to
treat an illness or injury, and which, as determined by Blue Shield, are


 


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1.               consistent
with Blue Shield medical policy; and


 


2.               consistent
with the symptoms or diagnosis; and


 


3.               not
furnished primarily for the convenience of the patient, the attending Physician
or other provider; and


 


4.               furnished
at the most appropriate level which can be provided safely and effectively to
the patient.


 


Blue Shield reserves the right to
review all services to determine whether they are medically necessary.


 


Member -
either a Subscriber or a Dependent.


 


Open Enrollment Period - that
period of time set forth in the Health Services Contract during which eligible
individuals and their Dependents may enroll in the Plan.


 


Outpatient - an
individual receiving Benefits under the direction of a Plan Provider, but not
as an Inpatient.


 


Physician - an
individual licensed to engage in the practice of medicine (M.D.) or osteopathy
(D.O.).


 


Plan - the
Blue Shield of California Health Maintenance Organization Health Plan
(BSC-HMO).


 


Plan Hospital - a
Hospital licensed under applicable state law, contracting with Blue Shield
specifically to provide Plan Benefits to Members under the Plan.


 


Plan Provider - a
provider who has an agreement with Blue Shield to provide Plan Benefits to
Members.


 


Primary Care
Physician (PCP) - a general practitioner, board-certified or eligible
family practitioner, internist, obstetrician-gynecologist or pediatrician who
has contracted with Blue Shield through IPA to provide primary care Benefits to
Members and to refer, authorize, supervise and coordinate the provision of all
Benefits to Members in accordance with their Health Services Contract.


 


Service Area - that
geographic area served by the Plan as set forth in Schedule B.


 


Specialist - a
board-certified or eligible Physician, other than a PCP, who has an agreement
with Blue Shield to provide Services to Members on referral by a PCP.


 


Subscriber - an
individual who satisfies the eligibility requirements of the Health Services
Contract, who is enrolled and accepted by the Plan.


 


Surcharge - an
additional fee which is charged to a Member for a Benefit which is not provided
for in the Health Services Contract or disclosed in the Evidence of Coverage
(or the disclosure form used as the Evidence of Coverage).


 


II.  IPA OBLIGATIONS


 


2.1                                 Benefits.  IPA shall provide or arrange for all
Capitated Services described in Schedule A, subject to the Benefits covered in
the Member’s Health Services Contract. 
Further, IPA and/or IPA Providers shall make available to BSC-HMO
Members, at no charge, those health education programs routinely provided by
IPA and/or IPA Providers.


 


2.2                                 Availability.  IPA shall ensure that Benefits are readily
available during regular business hours and that emergency services are
available twenty-four (24) hours per day, seven (7) days per week, including
holidays.  IPA shall provide such
services in the same manner, in accordance with the same standards, and within
the same time availability as such services are provided to other patients, and
without regard to the degree or frequency of utilization of such Benefits by
Member.


 


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2.3                                 Standard
of Care.  IPA shall comply
with all applicable federal and state laws, licensing requirements and
professional standards and shall provide Benefits in accordance with generally accepted
medical and surgical practices and standards prevailing in the applicable
professional community at the time of treatment.  In addition, IPA and IPA Providers shall comply with the
professional and technical standards adopted by the BSC-HMO quality and
utilization management program set forth in the Provider Manual.


 


2.4                                 IPA
Provider Licensure and Medical Staff Requirements.  IPA warrants and represents as a material
term of this Agreement that all IPA Providers, as applicable, are and will
continue to be, as long as this Agreement remains in effect, the holders of
currently valid, unrestricted licenses to practice in the State of California,
and further, that IPA Physicians are members in “good standing” on the medical
staff of at least one Plan Hospital. 
IPA agrees to admit Members only to such Plan Hospital(s) unless BSC-HMO
agrees that circumstances require otherwise.


 


2.5                                 Capacity.  Each Member shall select a PCP in accordance
with the procedures set forth in the Health Services Contract and IPA shall
cooperate with BSC-HMO to assist Members in selecting a PCP. IPA shall at all
times maintain a sufficient number of PCPs to guarantee a patient load per
Physician ratio of no more than 1,200 patients enrolled per full-time
equivalent PCP.  All PCPs shall be IPA
Physicians.  IPA agrees that BSC-HMO
shall have no obligation to guarantee any minimum number of Members to IPA and
that each PCP bound by the terms of this Agreement shall accept all patients
enrolling as BSC-HMO Members.


 


2.6                                 Blue
Shield Physician Members. 
As a condition precedent to this Agreement, IPA Physicians must be Blue
Shield Physician Members.  IPA
Physicians agree to remain Blue Shield Physician Members throughout the term of
this Agreement.


 


2.7                                 Institutional
Services and Admissions.  
IPA agrees to comply with BSC-HMO service authorization procedures as
set forth in the Provider Manual.


 


2.8                                 Capitated
Services Referrals.   In providing or
arranging for the Medically Necessary Benefits listed in Schedule A, IPA shall
limit referrals of Members to IPA Providers or employees as outlined below:


 


(a)          Referral
Specialists.  IPA shall maintain
contracts in force with referral specialists in the specialty areas outlined in
the Provider Manual.  All contracting
specialists must be in compliance with Paragraph 2.4 herein.


 


(b)         Nursing
and Other Ancillary Health Care Personnel. 
IPA Providers, as appropriate, must provide or contract for qualified
nursing and other personnel in sufficient number to serve all BSC-HMO Members.  All allied health care personnel must be
appropriately qualified, certified, and/or licensed.


 


(c)          Laboratory,
Imaging and Other Diagnostic Services. 
IPA or IPA Providers, as applicable, must operate or contract with
readily accessible facilities that are under the supervision of an
appropriately board-certified or eligible Physician.  Technical supervision must be by an appropriately certified
technician.  Equipment must be
maintained in compliance with all applicable state and federal laws.


 


IPA agrees to comply with the
BSC-HMO Service Authorization procedures set forth in the Provider Manual.  In the event an IPA Provider must refer to a
provider who is not a Plan Provider or IPA contractor, IPA shall obtain
BSC-HMO’s approval prior to such referral.


 


2.9                                 IPA
Provider Contracts.  IPA shall require
that all IPA Providers comply with the applicable terms of this Agreement,
including, but not limited to, the following:


 


(a)          provide
Benefits in accordance with generally accepted medical and surgical practices
and standards prevailing in the applicable professional community at the time
of treatment; and


 


(b)         provide
services to Members upon authorized referral from IPA; and


 


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(c)          comply
with all applicable federal and state laws including but not limited to the
provisions set forth in Article VI of this Agreement; and


 


(d)         accept
payment from IPA as payment in full for services rendered to Members, except
for Copayments, and must agree not to seek from the Member any Surcharge or
other additional payment not provided for in the Health Services Contract
regardless of whether or not payment is received from IPA.  Members shall not be liable to contracting
provider for any sums owed to provider by IPA; and


 


(e)          not
bill or collect from a Member any charges in connection with health care
services even though those services are not Benefits, unless contractor has
obtained an executed Acknowledgment of Financial Responsibility Form from the
Member or the Member’s legal representative prior to the time that such
services are provided to the Member; and


 


(f)            provide
Institutional Services only with the Authorization of IPA and BSC-HMO, as
applicable; and


 


(g)         maintain
adequate professional liability insurance through an insurer acceptable to
BSC-HMO and provide evidence of such coverage to BSC-HMO upon request; and


 


(h)         comply
with, and accept as final, the decisions of the BSC-HMO quality and utilization
management program; and


 


(i)             follow
the procedures established by BSC-HMO for verifying eligibility of Members and
authorizing Benefits; and


 


(j)             provide
and maintain sufficient facilities, equipment, personnel and services within
the Service Area in order to provide specified Benefits to Members; and


 


(k)          continue
to provide Benefits to Members under the same terms and conditions as agreed to
by IPA under Paragraph 8.4 of this Agreement.


 


The standard IPA contract with
providers shall be prepared or arranged in a manner which permits confidential
treatment of provider payment without concealment or misunderstanding of other
terms and provisions of the contract and shall contain all of the above
obligations and prohibitions.  The
standard IPA contract between IPA and its contracting providers is set forth in
Schedule G.  IPA shall provide copies of
the executed signature page of each such contract to BSC-HMO.


 


2.10                           Reciprocity.  IPA shall participate in the statewide
BSC-HMO health services delivery network and offer reciprocal agreements to
other Plan Providers.  IPA Providers
also agree to provide services to Members in the Blue Cross/Blue Shield
national HMO network (HMO-USA) as set forth in the Provider Manual.  Services rendered under the provisions of
this paragraph shall be paid as set forth in Paragraph IV of this Agreement.


 


2.11                           Facilities
and Equipment.  IPA Providers
shall provide and maintain facilities and equipment which are of adequate
capacity, clean, safe, readily accessible to Members and, where appropriate,
properly licensed and/or registered.


 


2.12                           Administrative
Services.  IPA shall perform
or contract for all services incident to the administration of IPA’s
responsibilities in accordance with this Agreement and as set forth in the
Provider Manual.


 


2.13                           BSC-HMO
Grievance Procedures.  
IPA shall cooperate with BSC-HMO in identifying, processing and
resolving all Member complaints and grievances pursuant to the grievance
procedures set forth in the Provider Manual. 
IPA and IPA Providers also agree to use the grievance procedure described
in the Provider Manual, in the event IPA or an IPA Provider has a complaint
against a Member.


 


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2. 14                        Verification
of Eligibility.  IPA and/or IPA
Providers shall verify a Member’s eligibility to receive Benefits by requesting
the Member to present his BSC-HMO identification card and by checking the
Eligibility List provided by BSC-HMO in accordance with this Agreement.  For patients claiming enrollment in the
Plan, but not appearing on the Eligibility List, IPA and/or IPA Providers shall
confirm eligibility by telephoning BSC-HMO or shall obtain a Conditional
Coverage Form from the patient according to the procedure set forth in the
Provider Manual.  Until such Member’s
name appears on the Eligibility List, IPA and/or IPA Providers shall limit the
provision of services to Emergency services unless prior approval is obtained
from BSC-HMO.


 


2.15                           Prescriptions.  Unless otherwise required by a Member’s
specific medical needs, IPA Providers shall utilize the drug formulary adopted
by BSC-HMO.


 


2.16         Termination
of the Physician/Patient Relationship.


 


(a)          IPA may
terminate its professional relationship with a Member if the Member refuses to
follow the course of medical treatment prescribed by an IPA Provider and, in
the treating provider’s professional opinion, no acceptable alternative exists,
or the Member becomes unnecessarily disruptive or abusive.  IPA shall provide a written request for
termination to BSC-HMO, describing the circumstances and reasons for such
termination.  Such termination requests
shall be processed in accordance with the termination procedures as set forth
in the Provider Manual.  If approved by
BSC-HMO, IPA shall give the Member written notice of the termination of the
provider/patient relationship.   IPA may
not terminate its relationship with a Member because of such Member’s medical
condition, or the amount, variety, or cost of Benefits that are required by the
Member.


 


(b)         IPA
acknowledges that a Member may request transfer between IPAs in accordance with
the Member’s Health Services Contract, (1) at the Open Enrollment Period, (2)
if the Member changes residence, (3) one other time during the Calendar Year,
and (4) if the IPA discontinues its participation in the Plan.  As appropriate, IPA further agrees to accept
the transfer of a Member to IPA at the request of BSC-HMO.  In either situation, IPA shall provide
patient records, reports and other documentation regarding such Member to
BSC-HMO or new IPA upon request and shall facilitate any approved transfers of
responsibility.  If approved by BSC-HMO,
a transfer shall become effective as of the first day of the month following
BSC-HMO’s approval or at an earlier time if circumstances, in the opinion of
BSC-HMO, justify such earlier transfer.


 


2.17                           Required
Disclosures. IPA shall notify BSC-HMO immediately in writing upon the
occurrence or disclosure of any of the following events:


 


(a)          An IPA
Provider’s license to practice in California is suspended, revoked, terminated
or subject to terms of probation or other restriction; or


 


(b)         An IPA
Provider’s medical staff privileges at any hospital are denied, suspended,
restricted, revoked or voluntarily relinquished in lieu of disciplinary action;
or


 


(c)          An IPA
Provider becomes the subject of any disciplinary proceeding or action before
the Board of Medical Quality Assurance or a similar agency in any state; or


 


(d)         An IPA
Provider fails to remain a Blue Shield Physician Member; or


 


(e)          An IPA
Provider is convicted of a fraud or felony; or


 


(f)            There
is a change in the bylaws, membership, ownership, and/or officers of IPA; or


 


(g)         An act
of nature or any event beyond IPA’s reasonable control occurs, which
substantially interrupts all or a portion of IPA’s business or an IPA
Provider’s practice or which has a materially adverse effect on IPA’s ability
to perform its obligations hereunder; or


 


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(h)         IPA
and/or IPA Providers fail to maintain the insurance coverage required under
Article VII of this Agreement, or to replace coverage which is canceled or
terminated, as specified therein; or


 


(i)             IPA
and/or IPA Provider learns of any malpractice action against IPA and/or IPA
Provider; or becomes aware of a malpractice judgment or settlement against IPA
and/or IPA Provider; or


 


(j)             There
is a change in IPA’s or IPA Provider’s business address; or


 


(k)          There
is a change in IPA’s or IPA Provider’s contract; or


 


(1)          Any
other situation arises which could reasonably be expected to affect IPA’s or an
IPA Provider’s ability to carry out its obligations under this Agreement.


 


2.18                           Encounter
and Claims Data.   IPA shall provide
BSC-HMO with encounter/claims data as set forth in Schedule C of this Agreement
and in accordance with the procedures set forth in the Provider Manual.  Required data shall be delivered by IPA to
BSC-HMO not later than forty-five (45) days following the end of the month in
which care was rendered.  Under no
circumstances shall IPA bill a Member for Benefits or make a Member responsible
for submitting such bill to BSC-HMO.


 


2.19                           IPA Physician/Provider
List.  IPA shall provide BSC-HMO with the name,
address, specialty, board status, professional license number, curriculum
vitae, history and proof of current professional liability insurance, phone
number and office hours of each IPA Provider. 
IPA shall use its best efforts to notify BSC-HMO a minimum of thirty
(30) days in advance of any change in this information or of the addition or
termination of an IPA Provider.  IPA
agrees that BSC-HMO may list the name, specialty, address and telephone number
of IPA and IPA Providers in BSC-HMO publications provided to Plan employees,
Providers, Members and Contractholders and may use such information in
advertising and marketing materials.


 


III. BSC-HMO OBLIGATIONS


 


3.1                                 Provider
Manual.  BSC-HMO shall make
available to IPA and IPA Providers the Blue Shield HMO Physician Manual,
herein referred to as Provider Manual, describing Plan policies and
procedures.  The Provider Manual, which
is incorporated herein by reference, shall be updated by BSC-HMO on a periodic
basis and in accordance with this Agreement.


 


3.2                                 Payment.  BSC-HMO shall pay IPA directly for Benefits
in accordance with Article IV of this Agreement.


 


3.3                                 Identification
Cards.  BSC-HMO shall
issue Plan identification cards to Members as set forth in the Provider Manual.


 


3.4                                 Eligibility
Determination.  BSC-HMO shall
confirm eligibility and provide Eligibility Lists to IPA as set forth in the
Provider Manual.


 


3.5                                 Service
Authorizations.  BSC-HMO shall
authorize Benefits as set forth in the Provider Manual and in accordance with
IPA procedures.


 


3.6                                 Out-of-Area
Services.  Out-of-area
Emergency services are those services provided outside the Service Area of the
Plan in conjunction with an Emergency. 
BSC-HMO shall assume costs associated with out-of-area Emergency
services.


 


3.7                                 Administrative
Services.  BSC-HMO shall
perform or contract for those services incident to the administration of the
Plan including, but not limited to, the processing of enrollment applications,
assignment of Members to their PCPs, provision of data to IPA regarding
Members’ utilization of Benefits and the administration of claims for Benefits
which are not Capitated Services under this Agreement.


 


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3.8                                 BSC-HMO
Health Services Delivery Advisory Committee.  BSC-HMO may establish a health services delivery advisory
committee(s) within a defined geographic area to advise BSC-HMO on a variety of
issues from an HMO perspective.  IPA may
be requested from time to time by BSC-HMO to appoint IPA Providers to serve as
members on the health services delivery advisory committee(s).


 


IV. COMPENSATION


 


4. l                                 Capitation
Fees.  Except as otherwise provided in this Article
IV, BSC-HMO shall pay IPA the Capitation Fees set forth in Schedule E on a
monthly basis no later than the twentieth (20th) day of each month.  Those Capitation Fees paid shall be for all
Members eligible from the first (1st) day of the month for which the payment is
made, who have chosen an IPA Physician as their PCP.  Such Capitation Fees shall be payment in full for Benefits as set
forth in Schedule A, except for Copayments, and third party collection as set
forth in Paragraph 4.8.  If the
encounter/claims information required under Paragraph 2.18 herein is not submitted
to BSC-HMO in a timely manner, then Capitation Fees will be withheld by BSC-HMO
until the required encounter/claims information is received.  These rates are effective from November 1, 1995, and thereafter, until
such time as the parties agree on new rates. 
Any material modification to the services set forth in Schedule A made
by BSC-HMO shall be accompanied by an appropriate modification of the
Capitation Fees set forth in Schedule E.


 


4.2                                 Other
Fees.  BSC-HMO shall pay IPA for Benefits rendered
to Members which are not included in the Capitation Fees at the rates set forth
in Schedule D, reduced by any applicable Copayments.  IPA also agrees to accept the fees set forth in Schedule D,
reduced by any applicable Copayments, for Benefits rendered to Members on
referral from other Plan Providers. 
Such fees shall be payment in full for services rendered except for
third party collections as set forth in Paragraph 4.8.


 


4.3                                 Stop
Loss.  The financial liability of IPA under the
Capitation Fees paid in accordance with Paragraph 4.1 above for Benefits
rendered to any one Member during a specified twelve (12) month period shall be
limited to the amount set forth in Schedule D.


 


4.4                                 Institutional
Incentive.  BSC-HMO will
establish a budget for Institutional Services in accordance with generally
accepted actuarial practices.  The
financial liability of BSC-HMO and IPA for authorized Benefits rendered to
Members assigned to IPA shall be determined in accordance with the provisions
set forth in Schedule F.


 


4.5                                 Copayments.  IPA shall diligently pursue and have sole
responsibility for collection of any applicable Copayments from Members and
shall in no event offer, publicize or advertise any waiver or other reduction
of any Copayments, unless specifically authorized in writing by BSC-HMO.  All Copayments shall be as specified in the
Health Services Contract and the amounts of the Copayments which IPA is
authorized to collect from the Member shall not exceed the amounts so specified.


 


4.6                                 Prohibition
Against Member Billings and Collections.  IPA agrees to accept those fees set forth in Schedules D and E as
payment in full for Benefits and not to seek from the Member any Surcharge or
other additional payment not provided for in the Member’s Health Services
Contract regardless of whether or not payment is received from BSC-HMO.  Whenever BSC-HMO receives notice of such
Surcharges it shall take appropriate action. 
Members shall not be liable to IPA or IPA Providers for any sums owed to
IPA or IPA Providers by BSC-HMO.  This
prohibition shall not apply to Copayments or third party collections in
accordance with the applicable Health Services Contract and Paragraph 4.8.


 


4.7                                 Non-Covered
Services.   IPA or IPA
Providers shall not bill or collect from a Member any charges in connection
with health care services, even though those services are not Benefits, unless
an executed Acknowledgment of Financial Responsibility Form has been obtained
from the Member or the Member’s legal representative prior to the time that
such services are provided to the Member. 
A copy of the Acknowledgment of Financial Responsibility Form is set
forth in the Provider Manual.


 


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4.8                                 Third
Party Collections.  IPA and IPA
Providers shall cooperate with BSC-HMO for the proper coordination of Benefits
and in the collection of third party payments including workers’ compensation,
third party liens and other third party liability according to the procedures
set forth in the Provider Manual.


 


4.9                                 Care to
Canceled or Ineligible Persons. 
BSC-HMO shall discourage retroactive cancellation from the Plan of any
Member by a Contractholder after the applicable monthly billing is
reconciled.  Where no significant services
have been rendered, however, BSC-HMO may make occasional exceptions due to
legitimate administrative processing requirements.


 


Subject to IPA’s compliance with
the verification of eligibility procedures set forth in Paragraph 2.14 of this
Agreement, BSC-HMO shall be financially responsible for all care provided by
IPA Providers to an ineligible person or a retroactively canceled Member due to
erroneous, incomplete or delayed BSC-HMO Eligibility Lists; BSC-HMO’s financial
responsibility is contingent upon the PCP providing BSC-HMO with evidence that
it has unsuccessfully sought payment for all, or a portion of, such charges
from the patient or the person having legal responsibility for such patient,
through two (2) billing cycles immediately following notice of ineligibility or
retroactive cancellation.  In the event
that a Member is declared ineligible or is retroactively canceled, the
financial responsibility assumed by BSC-HMO under this Paragraph 4.9 shall be
the fee for service amount for Capitated Services rendered based on the
Equivalent Values set forth in Schedule D.


 


BSC-HMO shall deduct from IPA’s
next month’s Capitation Fees those amounts which have been paid to IPA for
ineligible or retroactively canceled persons for whom no Capitated Services
were rendered or from whom IPA has collected fee for service charges.


 


V.  QUALITY AND UTILIZATION MANAGEMENT


 


5.1                                 BSC-HMO’s
Responsibilities.  BSC-HMO is
obligated under law to conduct quality and utilization management activities
that identity, evaluate and remedy problems relating to access, continuity and
quality of care, utilization and the cost of services.  Accordingly, BSC-HMO shall conduct a quality
and utilization management program as set forth in the Provider Manual.  BSC-HMO’s program shall include the
establishment of peer review committees to conduct quality of care and
utilization review activities in accordance with the California Health and
Safety Code Sections 1370 and 1370.1. 
All quality and utilization management forms, records and other
information in BSC-HMO’s possession shall remain the property of BSC-HMO and
shall remain confidential.


 


5.2                                 IPA’s
Responsibilities.  IPA and IPA
Providers shall cooperate with BSC-HMO in monitoring quality and utilization
management activities delegated to IPA by BSC-HMO.  IPA shall have a written quality and utilization review plan and
shall have, and operate at its sole expense, a quality and utilization review
committee which shall identify, evaluate and remedy problems relating to
access, continuity, quality of care, utilization and the cost of services
provided or authorized by IPA.  IPA
shall keep records and minutes of the committee meetings and peer review
activities.


 


5.3                                 Shared
Records.  Upon request, IPA
shall make any records of its quality assurance and utilization review
activities pertaining to BSC-HMO Members available to BSC-HMO’s quality and
utilization review committee.  Such
sharing of records between the two committees shall be in accordance with, and
limited to, Sections 1157 of the California Evidence Code and 1370 of the
California Health and Safety Code and shall not be construed as a waiver of any
rights or privileges conferred on either party by those statutes.


 


VI.  RECORDS


 


6.1                                 Member’s
Medical Record.  IPA shall ensure
that a central medical record is established and maintained for each
Member.  At a minimum, the record shall
include all information about the Member and a description of all services
rendered to Plan Member as dictated by generally accepted medical and surgical
practices and standards and as required by the Provider Manual.


 


9

















 


6.2                                 Access
to Medical Records.  Subject to
compliance with applicable federal and state laws and professional standards
regarding the confidentiality of medical records, IPA and IPA Providers shall
assist BSC-HMO in achieving continuity of care for Members through the maximum
sharing of medical records for services rendered to Members.  IPA’s obligations under this Paragraph 6.2
shall include, without limitation:


 


(a)          providing
BSC-HMO with copies of Member medical records that are in the custody of IPA or
IPA Providers; and


 


(b)         allowing
BSC-HMO authorized personnel access to such records on IPA’s or IPA Provider’s
premises during regular business hours; and


 


(c)          transmitting
information from Members’ medical records by telephone to BSC-HMO for purposes
of Authorization or other quality and utilization management activities; and


 


(d)         upon
reasonable request, providing copies of a Member’s medical records to any other
Plan Provider treating such Member.


 


6.3                                 Access
to Financial Records. 
BSC-HMO shall have access at reasonable times, upon demand, to the
books, records and papers of IPA and IPA Providers relating to Benefits
provided to Members, including, but not limited to, the financial condition of
IPA and any charges to, or payments received from, Members by IPA or IPA
Providers.


 


6.4                                 Confidentiality.  BSC-HMO and IPA agree to keep confidential
and to take the usual precautions to prevent the unauthorized disclosure of any
and all medical and/or contractual records and information required to be
prepared or maintained by IPA, IPA Providers or BSC-HMO under this Agreement.


 


6.5                                 Regulatory
Compliance.  IPA and IPA
Providers shall maintain such records and provide such information to BSC-HMO,
the United States Department of Health and Human Services, the State of
California Department of Health Services and the California Department of
Corporations as may be necessary for compliance by BSC-HMO with federal and
state law including, but not limited to, the California Knox-Keene Health Care
Service Plan Act of 1975, as amended, and the rules and regulations duly
promulgated thereunder, for a period of at least five (5) years.  This obligation of IPA and IPA Providers
does not cease upon termination of this Agreement whether by rescission or
otherwise.  All records, books and
papers of IPA and IPA Providers pertaining to Members shall be open to
inspection during normal business hours by BSC-HMO and state and federal
authorities.


 


VII.  INSURANCE


 


7.1                                 Insurance.  IPA and IPA Providers shall secure and
maintain from insurance companies approved to conduct business in the State of
California and acceptable to BSC-HMO, professional and general liability
insurance to insure it and its partners, shareholders, officers, members,
employees and agents.  Such insurance
shall have limits of coverage considered to be reasonably adequate for the risk
insured against.  IPA shall provide
certificates of coverage as requested by BSC-HMO, and shall, as set forth in
the Provider Manual, obligate the carrier of each such insurance policy to give
BSC-HMO written notice by registered mail at least thirty (30) days prior to
cancellation or other termination of such policy.


 


VIII. TERM AND TERMINATION


 


8.1                                 Term.  When executed by both parties, this
Agreement shall become effective as of the date noted on page 1 hereof and
shall continue in effect until terminated hereunder.


 


8.2                                 Termination.  Either party may terminate this Agreement,
with or without cause, by giving the other party at least one hundred eighty
(180) calendar days written notice.


 


10

















 


8.3                                 Immediate
Termination.    After review of
all pertinent information, BSC-HMO may, at its option, immediately terminate
this Agreement with IPA and/or IPA Provider by written notice, upon the
occurrence of any of the conditions outlined in Paragraph 2.17, or if IPA
and/or IPA Provider is determined not to be in compliance with Paragraph 2.3,
or if BSC-HMO determines that the health, safety or welfare of Members is
jeopardized by continuation of this Agreement.


 


8.4                                 Effect
of Termination.  As of the date of
termination, this Agreement shall be considered of no further force or effect
whatsoever and each of the parties shall be relieved and discharged herefrom,
except that:


 


(a)          Termination
shall not effect any rights or obligations hereunder which have previously
accrued or shall hereafter arise, with respect to any occurrence prior to
termination and such rights and obligations shall continue to be governed by
the terms of this Agreement.


 


(b)         IPA
agrees, at BSC-HMO’s option, to provide Benefits to Members assigned to IPA
PCPs, including any Members who become eligible during the notice period set
forth in Paragraph 8.2  above,
under the terms of the Member’s Health Services Contract until the annual
anniversary dates of those Contracts. 
IPA shall be compensated for Benefits rendered in accordance with this
Paragraph 8.4 at the fees set forth in Schedule E of this Agreement, until such
time as:


 


1.               appropriate
transfer of Members is achieved; or


 


2.               an
alternate source of payment for Benefits, acceptable to IPA has been found.


 


(c)          Each
party shall be responsible for the costs of completing any arbitration
proceedings initiated pursuant to this Agreement as set forth in Paragraph 9.9,
including requests for arbitration of disputes arising between the parties
after the effective date of termination.


 


(d)         IPA
shall maintain such records and provide such information to BSC-HMO as set
forth in Article VI of this Agreement. 
These records shall be maintained for at least five (5) years regardless
of the termination date of this Agreement.


 


IX.  MISCELLANEOUS PROVISIONS


 


9.1                                 Partial
Invalidity.  If for any reason,
any provision of this Agreement is held invalid, the remaining provisions shall
remain in full force and effect.


 


9.1                                 Waiver
of Breach.   The waiver of any
breach of this Agreement by either party shall not constitute a continuing
waiver of any subsequent breach of either the same or any other provision of
this Agreement.


 


9.3                                 Schedules.  All Schedules referenced in this Agreement
and attached hereto are incorporated herein by this reference.


 


9.4                                 Amendments.  Unless otherwise specifically provided
herein, this Agreement may be amended or changed only by mutual written consent
of BSC-HMO and IPA’s duly authorized representatives.  Notice to, or consent of, Members shall not be required for any
amendments to this Agreement.


 


9.5                                 Governing
Law.  This Agreement shall be construed and
enforced in accordance with the laws of the State of California.


 


9.6                                 Entire
Agreement.  This Agreement,
together with the Schedules hereto and the standards, policies and procedures
established by BSC-HMO and incorporated herein by reference, contains the
entire understanding between the parties and supersedes all prior agreements,
either oral or in writing, with respect to the subject matter hereof.


 


11

















 


9.7                                 Independent
Parties. In the performance of the work, duties and obligations assumed
under this Agreement, it is mutually understood and agreed that each party, its
agents, employees or representatives are at all times acting and performing as
independent contractors and that neither party shall consider itself or act as
the agent, employee or representative of the other.


 


9.8                                 Cooperation
of Parties.  IPA and BSC-HMO
agree to meet and confer in  good
faith on common problems including, but not limited to, utilization of
services, problems concerning credentialing, authorization, encounters/claims
or reporting procedures and information and forms provided to IPA for use in
conjunction with Members.


 


9.9                                 Arbitration.   Disputes between BSC-HMO and IPA arising
out of this Agreement shall be resolved by arbitration, which shall be
conducted according to the Commercial Rules of Arbitration of the American
Arbitration Association (AAA), and under the auspices of the AAA.  The award must be based on proof properly
received into evidence and must be according to law.  The cost of arbitration shall be divided equally between the
parties.


 


9.10                           Attorneys’
Fees.    If proceedings other than arbitration are
necessary to enforce this Agreement, the prevailing party shall be entitled to
reasonable attorneys’ fees in addition to any other relief it may obtain.


 


9.11                           Advertising.  The name of IPA and/or IPA Provider is the
sole and exclusive property of IPA, IPA and IPA Provider hereby expressly
consent to Plan’s including IPA and/or IPA Provider’s name in any document
prepared for the purpose of marketing BSC-HMO. 
IPA and/or IPA Provider may identify itself as a Plan IPA or Plan
Provider.  IPA and/or IPA Provider shall
have no other right to use the name BSC-HMO in any advertisement or otherwise
without the express written consent of BSC-HMO.


 


9.12                           Notices.  Any notice required to be given pursuant to
the terms of this Agreement shall be in writing and shall be sent, postage
prepaid, by certified mail, return receipt requested, to BSC-HMO or IPA at the
address below.  The notice shall be
effective on the date of delivery indicated on the return receipt.


 


	
  If to Blue Shield of California:

  	
   

  	
  BLUE SHIELD Of
  California

  
	
   

  	
   

  	
  6701 Center Dr. West, Suite 800

  
	
   

  	
   

  	
  Los Angeles, CA 90045

  
	
   

  	
   

  	
  Attention:

  	
  Alan Puzarne

  
	
   

  	
   

  	
   

  	
  Vice President, Southern California

  
	
   

  	
   

  	
   

  
	
  If to IPA:

  	
   

  	
  Prospect Medical
  Group, Inc.

  
	
   

  	
   

  	
  18200 Yorba Linda Blvd.

  
	
   

  	
   

  	
  Yorba Linda, CA 92686

  
	
   

  	
   

  	
  Attention:

  	
  Katie Caropino

  
					



 


9.13                           Captions.  The captions contained herein are for
reference purposes only and shall not affect the meaning of this Agreement.


 


9.14                           Assignment.  Neither BSC-HMO nor IPA shall assign or
transfer its rights, duties or obligations under this Agreement without the
prior written consent of the other party.


 


9.15                           Genders
and Numbers.  The masculine,
feminine or neuter gender and the singular or plural numbers shall be deemed to
include the others whenever the context so indicates or requires.


 


IN WITNESS WHEREOF, the
undersigned have executed this Agreement as of the date(s) written below.


 


	
  BLUE
  SHIELD OF CALIFORNIA

  	
   

  	
  PROSPECT
  MEDICAL GROUP, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Alan Puzarne

  	
   

  	
   

  	
  By:

  	
  /s/  Gregg DeNicola

  	
   

  
	
   

  	
  (Alan Puzarne)

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  VP/Chief
  Executive, Southern Region

  	
   

  	
   

  	
  Title:

  	
  CEO

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  12/6/95

  	
   

  	
   

  	
  Date:

  	
  11/13/95

  	
   

  



 


12

















 


SCHEDULE
A


 


Prospect
Medical Group, Inc.


 


FULL
PROFESSIONAL SERVICE CAPITATION DEFINITION


 


FOR IPAs


 


Effective Date: November 1, 1995


 


“Full Professional Service” for the
purposes of capitation is defined as  all
covered outpatient and Inpatient professional health care services provided by
a Physician or other appropriate health care provider and all covered
outpatient diagnostic and treatment services, supplies, materials, drugs, and
medicines, used or administered in the office, or other outpatient setting,
except the facility charges for ambulatory surgery and in-area Emergency
services.  Capitated Services include
the following specific services:


 


1.               HEALTH
MAINTENANCE/PREVENTION


 


All office visits for well baby
care; periodic/routine screenings and examinations for children, adolescents
and adults; immunizations and injections, including the cost of injectables,
when provided as part of acceptable medical care; vision and hearing exams for
Members up to age 18, including:


 


a.               preventive
care - routine physical exams


 


b.              eye/ear
screenings up to age 18


 


c.               immunizations/serum


 


d.              therapeutic
injections/injectables


 


e.               health
screening and monitoring - HMO Health Incentive Program


 


2.               PATIENT
COUNSELING/HEALTH EDUCATION


 


All Member counseling and patient
health education regarding personal health behavior, health care and use of
health care services; patient counseling for family planning, family planning
services and genetic counseling; when indicated, all health education services
and classes provided or sponsored by IPA, or IPA Providers and, when indicated,
referrals to other health education services or classes and referral follow-up.


 


3.               OFFICE/OUTPATIENT
MEDICAL AND SURGICAL SERVICES


 


All office visits and outpatient
services provided by an IPA Provider for the purpose of treatment of an illness
or injury; and office visits and outpatient services for the purpose of
diagnosis and triage of a patient whose condition warrants the care of an IPA
Provider.  All supplies, materials,
orthotics/prosthetics under $50, drugs and medicines administered in the office
or other outpatient setting.


 


a.               office
medical services - diagnosis, treatment, triage


 


b.              consultations
and second opinions


 


c.               minor
procedures - all minor procedures or surgery performed in an office setting and
professional services for facility based ambulatory surgery


 


d.              mental
health - all outpatient services rendered by mental health professionals for
mental health or alcohol or drug abuse services


 


e.               outpatient
physical rehabilitation - all outpatient physical therapy, occupational therapy
and speech therapy


 


f.                 outpatient
radiation therapy, chemotherapy and chemotherapy drugs, outpatient hemodialysis
and other outpatient treatments and therapies, including facility-based day
care treatment


 


13

















 


g.              nutritional
counseling by a nutritionist or dietitian


 


h.              medical
social services


 


i.                  other
health care professionals


 


4.               OFFICE/OUTPATIENT
MEDICAL AND SURGICAL VISITS - CHRONIC CARE


 


All office visits and outpatient
services provided by an IPA Provider for the purpose of monitoring all chronic
conditions.  All supplies, materials,
orthotics/prosthetics under $50, drugs and medicines administered in the office
or other outpatient setting.


 


5.               DIAGNOSTIC
TESTS


 


All outpatient diagnostic tests
necessary for the provision of the services outlined in items 1 - 4 above,
including the technical and professional services for laboratory, diagnostic
x-ray, preadmission testing, nuclear medicine, ultrasounds, CT and NMR scans,
angiograms and other major diagnostic imaging, electrodiagnostic services,
pulmonary function and cardiac testing and other outpatient diagnostic
procedures.


 


6.               HOSPITAL/SNF
MEDICAL CARE


 


Hospital/SNF admissions; all
Inpatient visits or other professional service by an IPA Provider for the
purpose of providing Inpatient medical or surgical care, including the
professional component for Inpatient radiology, pathology and anesthesiology;
determining and arranging for necessary Inpatient care provided in a Hospital/SNF
by an IPA Provider; monitoring care provided in a Hospital/SNF by an IPA
Provider; making appropriate discharge plans; and Hospital/SNF discharges.


 


7.               HOME
MEDICAL SERVICES


 


Home or convalescent home visits
when Medically Necessary; and determining, arranging and monitoring home health
care treatment plans provided by a Plan Home Health Agency.


 


8.               IN-AREA
URGENT/EMERGENCY MEDICAL SERVICES


 


a.               Emergency
triage on a 24-hour a day basis to the most appropriate location for emergency
treatment; and


 


b.              telephone
advice, as medically appropriate, on a 24-hour a day basis for treatment of
minor illnesses and injuries; and


 


c.               all
professional charges for in-area Emergency services on a 24-hour a day basis,
provided by a Hospital.  (The Plan
covers the facility portion of Service Area Emergency room services.)


 


9.              OUT-OF-AREA/OUT
OF PLAN NON-EMERGENCY SERVICES


 


All services outlined in 1 - 7
above rendered out-of-area or out of Plan, because needed services are not
available within the IPA, service area or Plan network.  The Plan covers all professional and
facility charges for out-of-area Emergency services.


 


10.         CASE
MANAGEMENT/HMO ADMINISTRATION


 


All telephone consultations and
coordination with, and written correspondence to Plan personnel, IPA Providers
and Hospitals required for case management and the BSC-HMO quality and
utilization management program, as per this Agreement.


 


14

















 


SCHEDULE B


 


Prospect Medical
Group, Inc.


 


SERVICE AREA


 


Effective Date: November 1, 1995


 


The Service Area consists of the
following geographic area (city/zip code):


 


	
  Alhambra  

  	
  91801-805  

  
	
   

  	
  91899  

  
	
  Altadena  

  	
  91001-002  

  
	
  Anaheim  

  	
  92801-808  

  
	
   

  	
  92817  

  
	
  Arcadia  

  	
  91006  

  
	
  Artesia  

  	
  90701-703  

  
	
  Atwood  

  	
  92601  

  
	
  Azusa  

  	
  91702  

  
	
  Baldwin Park  

  	
  91706  

  
	
  Bell  

  	
  90201  

  
	
  Bellflower  

  	
  90706-707  

  
	
  Buena Park  

  	
  90620-624  

  
	
  Brea  

  	
  92621  

  
	
  Chino  

  	
  91708-710  

  
	
  Claremont  

  	
  91711  

  
	
  Compton  

  	
  90220-224  

  
	
  Corona  

  	
  91718-720  

  
	
  Corona del Mar  

  	
  92625  

  
	
  Costa Mesa  

  	
  92626 -628  

  
	
  Covina  

  	
  91722-724  

  
	
   

  	
  91790-793  

  
	
  Culver City  

  	
  90230-232  

  
	
  Cypress  

  	
  90630  

  
	
  Dana Point  

  	
  92629  

  
	
  Downey  

  	
  90240-242  

  
	
  Duarte  

  	
  91010  

  
	
  El Monte  

  	
  91731-735  

  
	
  El Segundo  

  	
  90245  

  
	
  El Toro  

  	
  92630  

  
	
  Fullerton  

  	
  92631-635  

  
	
  Garden Grove  

  	
  92640-645  

  
	
  Gardena  

  	
  90247-249  

  
	
  Glendale  

  	
  91201-210  

  
	
  Glendora  

  	
  91740  

  
	
  Harbor City  

  	
  90710

  
	
  Hawthorne  

  	
  90250-251  

  
	
  Huntington Beach

  	
  92605

  
	
   

  	
  92615

  
	
   

  	
  92646-650

  
	
  Huntington Park

  	
  90255

  
	
  Inglewood

  	
  90301-313

  
	
  Irvine

  	
  92710-720

  
	
   

  	
  92730

  
	
  Lake Forest

  	
  92630

  
	
  La Brea

  	
  92621-622

  
	
  La Habra

  	
  90631-633

  
	
  La Mirada  

  	
  90637-639

  
	
  La Puente  

  	
  91744-749  

  
	
  La Verne  

  	
  91750  

  
	
  Laguna Beach  

  	
  92651-654  

  
	
   

  	
  92656  

  
	
   

  	
  92677  

  
	
  Lakewood  

  	
  90711-716  

  
	
  Lawndale  

  	
  90260-261  

  
	
  Lomita  

  	
  90717  

  
	
  Long Beach  

  	
  90745-747  

  
	
   

  	
  90749  

  
	
   

  	
  90801-815  

  
	
   

  	
  90822  

  
	
   

  	
  90840-848  

  
	
   

  	
  90853  

  
	
   

  	
  90884  

  
	
   

  	
  90888  

  
	
  Los Alamitos  

  	
  90720-721  

  
	
  Los Angeles  

  	
  90001-023  

  
	
   

  	
  90026-045  

  
	
   

  	
  90047-048  

  
	
   

  	
  90050-063  

  
	
   

  	
  90065  

  
	
   

  	
  90067-068  

  
	
   

  	
  90070-076  

  
	
   

  	
  90078-093  

  
	
   

  	
  90095-101  

  
	
  Lynwood  

  	
  90262  

  
	
  Manhattan Beach  

  	
  90266  

  
	
  Maywood  

  	
  90270  

  
	
  Midway City  

  	
  92655  

  
	
  Mira Loma  

  	
  91752  

  
	
  Monrovia  

  	
  91016  

  
	
  Montclair  

  	
  91763  

  
	
  Montebello  

  	
  90640  

  
	
  Monterey Park  

  	
  91754-756  

  
	
  Newport Beach

  	
  92658-663  

  
	
  Norco  

  	
  91760

  
	
  Norwalk  

  	
  90650-659  

  
	
  Ontario  

  	
  91761-762  

  
	
   

  	
  91764  

  
	
  Orange  

  	
  92613  

  
	
   

  	
  92664-669  

  
	
  Palos Verdes

  	
  90274  

  
	
  Paramount

  	
  90723  

  
	
  Pasadena  

  	
  91030  

  
	
   

  	
  91050-051  

  
	
   

  	
  91101-109  

  
	
   

  	
  91121-129  

  
	
   

  	
  91131  

  
	
   

  	
  91182-184  

  
	
   

  	
  91188-189  

  
	
  Pico Rivera  

  	
  90660  

  
	
   

  	
  90665-666  

  
	
  Placentia  

  	
  92670  

  
	
  Pomona  

  	
  91766-769  

  
	
  Rancho Cucamonga

  	
  91730  

  
	
  Redondo Beach  

  	
  90254  

  
	
   

  	
  90277-278  

  
	
  Rosemead  

  	
  91770-772  

  
	
  San Dimas  

  	
  91773  

  
	
  San Gabriel  

  	
  91775-776  

  
	
  San Juan Capistrano

  	
  92675

  
	
   

  	
  92679  

  
	
   

  	
  92688  

  
	
   

  	
  92690-693  

  
	
  San Pedro  

  	
  90731-734  

  
	
  Santa Ana  

  	
  92701-709  

  
	
   

  	
  92711  

  
	
   

  	
  92712  

  
	
   

  	
  92721-728  

  
	
   

  	
  92799  

  
	
  Santa Fe Springs  

  	
  90670-671  

  
	
  Seal Beach  

  	
  90740  

  
	
  Sierra Madre  

  	
  91024  

  
	
  Silverado  

  	
  92676  

  
	
  South Gate  

  	
  90280  

  
	
  Stanton  

  	
  90680  

  
	
  Sunset Beach  

  	
  90742  

  
	
  Surfside  

  	
  90743  

  
	
  Temple City  

  	
  91780  

  
	
  Torrance  

  	
  90501-510  

  
	
  Trabuco Canyon  

  	
  92678  

  
	
  Tustin  

  	
  92680-681  

  
	
  Upland  

  	
  91785-786  

  
	
  Walnut  

  	
  91788-789  

  
	
  West Covina  

  	
  91790-793  

  
	
  Westminster  

  	
  92683-684  

  
	
  Whittier  

  	
  90604-612  

  
	
  Wilmington  

  	
  90744  

  
	
   

  	
  90748  

  
	
  Yorba Linda  

  	
  92686  

  



 


The Service Area outlined in this
Schedule B may be updated periodically to reflect changes in IPA Provider
locations and/or Zip Code additions or deletions identified by Plan or the U.S.
Postal Service.


 


15

















 


SCHEDULE C


 


Prospect Medical
Group, Inc.


 


ENCOUNTER AND CLAIMS REPORTING
REQUIREMENTS


 


Effective Date: November 1, 1995


 


In order to qualify for consideration
for settlement and/or other utilization or compensation evaluation purposes,
encounter and claims data for properly authorized Benefits must be submitted to
Plan as  set forth in the Provider
Manual with the following information as a minimum:


 


•                                          BSC-HMO
Member Number


•                                          Member
Name


•                                          Member
Date of Birth


•                                          Servicing
Provider Name


•                                          BSC-HMO
Provider Number (Servicing Provider)


•                                          Service
Date(s)*


•                                          Diagnosis
(ICD9 Diagnosis Codes)


•                                          CPT
Code(s)


•                                          CPT
Modifier(s)


•                                          Quantity
(Units of Service)


•                                          Billed
Amount(s)


•                                          Referring
Physician Name


 












*Plan will not include encounter and
claims data submitted more than ninety (90) days following the date of service
for consideration for settlement and/or other utilization or compensation
evaluation purposes.


 


16

















 


SCHEDULE D


 


Prospect Medical Group, Inc.


 


PLAN EQUIVALENT VALUES &  STOP LOSS


 


Effective Date: November 1, 1995


 


1.                                       Plan
Equivalent Values For Capitated Services (Conversion Factors)


 




	
  Medicine

  	
   

  	
   

  	
  ***

  	
   

  
	
  Surgery

  	
   

  	
   

  	
  ***

  	
   

  
	
  Anesthesiology

  	
   

  	
   

  	
  ***

  	
   

  
	
  Pathology

  	
   

  	
   

  	
  ***

  	
   

  
	
  Radiology

  	
   

  	
   

  	
  ***

  	
   

  
	
  Asst. Surgeon

  	
   

  	
   

  	
  ***

  	
   

  






 


17

















 


SCHEDULE E


 


Prospect Medical Group, Inc.


 


CAPITATION FEES FOR PLAN CAPITATED SERVICES


 


Effective Date: November
1, 1995


 


The
following Capitation Fees by age & sex category will be used to calculate
the total capitation payment due to IPA. 
The sum of the Members in each category will be multiplied by the
corresponding rates and the category totals will be added to determine the IPA’s
capitation payment for any given month.


 




	
  Age &
  Sex Categories and Capitation Fees1-3

  	
   

  
	
  Age/Sex
Category

  	
   

  	
  Professional
Capitation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PMPM

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child < 1

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child 1-4

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child 5-18

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 19-39

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 40-54

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 55-64

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 65-69

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 65-69*

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 70+

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 70+*

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 19-39

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 40-54

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 55-64

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 65-69

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 65-69*

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 70+

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 70+*

  	
   

  	
   

  	
  ***

  	
   

  
















*  Medicare carveout


 


1.                                       Inpatient Mental Health.  In addition to these capitation fees, Inpatient mental health
Capitated Services for Inpatient professional services will be paid at $.38 per
Member per month for eligible Members.


 


2.                                       Plan IFP Reimbursement.  Professional Capitation fees for Plan Individual and Family
Health Plan (IFP) Members will be paid at *** of the per Member per month
Professional Capitation Fees set forth in this Schedule.


 


3.                                       Stop Loss.   IPA has exercised the option of purchasing its own stop loss
protection and therefore no deduction for stop loss is applicable.  IPA agrees to give BSC-HMO written notice of
any cancellation or other termination of such stop loss coverage by registered
mall.  BSC-HMO shall have the right to
review and approve such stop loss coverage in advance.


 


 


18

















 


SCHEDULE
F


 


Prospect
Medical Group, Inc.


 


PLAN INSTITUTIONAL
SERVICES SHARED RISK/SAVINGS


 


Effective Date: November 1, 1995


 


The
following amounts by age & sex category will be used to calculate the Institutional
Services Budget for both the IPA and the institutions IPA uses to admit Plan
Members:


 




	
  Age &
  Sex Categories and Institutional Services Budget

  	
   

  
	
  Age/Sex

  Category

  	
   

  	
  Gross Institutional Services

  Budget

  	
   

  	
  Net Institutional Services

  Budget

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PMPM

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child < 1

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child 1-4

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Child 5-18

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 19-39

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 40-54

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 55-64

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 65-69

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 65-69*

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 70+

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Male 70+*

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 19-39

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 40-54

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 55-64

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 65-69

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 65-69*

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 70+

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  
	
  Female 70+*

  	
   

  	
   

  	
  ***

  	
   

  	
   

  	
  ***

  	
   

  






 


By
month, the sum of the Members assigned to IPA in each category will be
multiplied by the corresponding rates and the category totals will be added to
determine the IPA’s Institutional Services Budget for any given Agreement
Year.  The Institutional Services Budget
may be updated quarterly based on negotiated rate changes to the institutional
provider network.


 


If
the actual cost of authorized Institutional Services for IPA Members during an
Agreement Year is less than the Plan budgeted amount as outlined above, then
Plan shall pay IPA *** of the IPA Institutional Services Budget savings.


 


In
no event shall the total amount payable to IPA by Plan pursuant to this
Schedule exceed *** of the Capitation Fees paid to IPA during such Agreement
Year.


 


If
the actual cost of authorized Institutional Services for IPA Members during an
Agreement Year is more than the Plan budgeted amount as outlined above, then
IPA shall pay Plan 50% of the excess.


 


In
no event shall the total amount payable to Plan from IPA pursuant to this
Schedule exceed 15% of the Capitation Fees made to IPA during such Agreement
Year.


 


Upon
settlement of the Institutional Services Budget as provided for under the term
of this Schedule F, any payment due IPA or BSC-HMO shall be determined by
BSC-HMO within ninety days following the end of the Agreement Year and paid
within thirty days thereafter.


 












* Medicare carveout


 


19

















 


 


Institutional Stop Loss.  In the event that there is a deficit in the
IPA’s Institutional Service Fund, the following stop loss provision would
apply.


 


During any agreement year, the charges
against the fund for benefits rendered to any one member during any one
hospital admission will be limited according to the following schedule:


 




	
  BSC-HMO Membership in IPA

  	
   

  	
  Stop Loss
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  up to 500
  Members

  	
   

  	
   

  	
  ***

  	
   

  
	
  501 Members to 1000 Members

  	
   

  	
   

  	
  ***

  	
   

  
	
  1001 Members to 2000 Members

  	
   

  	
   

  	
  ***

  	
   

  
	
  Over 2000 Members

  	
   

  	
  -0-

  	
   

  






 


This Institutional Stop Loss will apply
only up to the point that actual costs of authorized Institutional Services for
IPA Members during an Agreement year, adjusted for this Stop Loss provision,
continues to be more than the Plan budgeted amount as set forth in Schedule
F.  Plan shall deduct a premium of $.50 per
month per Member for the Institutional Stop Loss for Members.


 


The following factors will be utilized
in determining the PMPM amount in the Institutional Service Budget:


 


Inpatient Costs:


 


•                                          Hospital
Utilization:


 


	
  St Jude Medical Center

  	
   

  	
  ***

  
	
  St. Joseph Hospital of Orange

  	
   

  	
  ***

  



 


•                                          Per
Diem Rate - As negotiated between Blue Shield and Hospital.


 


Non-inpatient Costs:


 


All other Non-Capitated Services
including:


 


•                                          Hospital
Outpatient Charges


•                                          SNF


•                                          Ambulance


•                                          Home
Health


•                                          Others


 


20

















 


SCHEDULE G


 


Prospect Medical
Group, Inc.


 


IPA PROVIDER CONTRACT


 


Effective Date: November 1, 1995


 


Attached is the standard IPA
contract for IPA contracting Providers.


 


21