AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     THIS  AMENDED AND RESTATED  EMPLOYMENT  AGREEMENT  ("Agreement"),  made and
entered into as of this 14th day of February,  2001 ("Effective  Date"),  by and
between Mid Atlantic  Medical  Services,  Inc., a Delaware  corporation with its
principal  executive  offices  at  4  Taft  Court,  Rockville,   Maryland  20850
("Company"),  and Mark D. Groban, M.D. ("Executive") supersedes and replaces all
previous employment agreements and amendments.

     WHEREAS,  the Company  wishes to assure itself of the services of Executive
for the period provided in this Agreement,  and Executive is willing to serve in
the employ of the Company on a full-time basis for said period;

     WHEREAS,  the Company and Executive desire to set forth the amounts payable
and benefits to be provided by the Company to Executive  while in the employment
of the Company and in the event of a termination of Executive's  employment with
the Company under the circumstances set forth herein;

     NOW THEREFORE,  in consideration of the mutual covenants  contained herein,
the parties hereto hereby agree as follows:

     1. Employment.  The Company agrees to continue Executive in its employ, and
Executive  agrees  to remain in the full  time  employ of the  Company,  for the
period stated in Section 3 hereof and upon the other terms and conditions herein
provided.

     2.  Position  and  Responsibilities.  The Company  employs  Executive,  and
Executive  agrees to serve,  as  Chairman  of the  Board of the  Company  on the
conditions  hereinafter  set forth.  Executive  agrees to perform such  services
consistent  with his  position  as shall from time to time be assigned to him by
the Company's Board of Directors ("Board"). Such duties may include, in addition
to his duties as Chairman,  the  appointment  of Executive as an officer  and/or
director of any present or future subsidiary or affiliate of the Company without
any additional remuneration under this Agreement.  Executive shall devote all of
his business time, attention,  skill, and efforts to the faithful performance of
the duties hereunder.

     3. Term. The period of Executive's employment under this Agreement with the
Company  shall be deemed to have  commenced  as of January 1, 2001 and remain in
effect for three years unless terminated earlier as provided herein.

     4. Compensation and Reimbursement of Expenses.

          (a).  General.  For all services  rendered by Executive as Chairman in
     addition  to any other  capacity  during  employment  under this  Agreement
     (including,  without  limitation,  services as an  executive,  officer,  or
     director of the Company,  or any subsidiary or affiliate of the Company, or
     as a member of any  committee  of the Board of  Directors of the Company or
     any  subsidiary  or  affiliate  of the  Company),  the  Company  shall  pay
     Executive as compensation (i) an annual salary ("Base  Salary");  (ii) such
     bonuses if any, as may be awarded to Executive  from time to time  pursuant
     to any Bonus Plan adopted by the Company for its senior  management;  (iii)
     such  other  bonuses  as may be  awarded  by the  Board  or by a  committee
     designated by the Board as described below ("Performance  Bonus");  (iv) an
     annual Chairman of the Board fee  ("Chairman's  Fee) of $100,000 to be paid
     in equal  bi-weekly  payments;  and (v) stock  options  as forth in Section
     4(b).

          (b).  Stock Options.

               (i). On January 15,  2001 and on each  subsequent  January 1 that
          this Agreement is in effect,  the Company will grant Executive options
          to purchase no less than  150,000  shares of MAMSI common stock at the
          stock price on the date of grant.  The  Compensation  Committee of the
          Board will annually  consider and submit to the Board a recommendation
          for option  grants in excess of the  minimum of  150,000.  All of such
          options  will  vest  50% on  the  date  of  grant  and  50%  based  on
          performance targets to be determined by the Stock Option Committee and
          the Board at the first Board meeting in the year of the grant.

               (ii).  The  number  and kind of  shares  subject  to  outstanding
          options,  the purchase  price or exercise  price of such options,  the
          limit now set forth in Section 5.01 of the Company's stock option plan
          (and any similar  successor plan or provision) and the number and kind
          of  shares  available  for  options   subsequently  granted  shall  be
          appropriately  adjusted to reflect any stock  dividend,  stock  split,
          combination  or exchange  of shares,  merger,  consolidation  or other
          change in capitalization  with a similar  substantive  effect upon the
          options  granted.  The Stock Option Committee shall have the power and
          sole and absolute discretion to determine the nature and amount of the
          adjustment to be made in each case.

          (c). Base Salary. Base Salary shall be $760,000 for 2001. For 2002 and
     each year  thereafter,  the Base Salary will increase by an amount equal to
     50% of the percentage increase in the Company's prior year consolidated net
     income  as  determined  by  the  Company,  and  audited  by  the  Company's
     independent  certified public accountant but any annual increase may not be
     greater than 8 percent.  There shall be no decreases  in  Executive's  Base
     Salary, as adjusted, during the term of this Agreement. This increase would
     first apply to the year 2002 and would take effect retroactively to January
     1 of the then current year. Items of a non-recurring nature may be excluded
     in the calculations as mutually agreed to by the Company and the Executive.

          (d). Bonuses.

               (i).  Executive shall be paid a bonus as may be determined  under
          the  applicable  Bonus  Plan  adopted  by the  Company  for its senior
          management.

               (ii).  In  addition,  for  2000  and each  year  thereafter,  the
          Executive  shall be paid a Performance  Bonus based on the  percentage
          increase in the Company's net income, as determined by the Company and
          as audited by the Company's  independent  certified public accountant,
          according to the following formula:
<TABLE>
<CAPTION>

         Percentage Increase in Company              Performance Bonus Percentage
         Net Income
         <S>                                         <C>

         0% - 8.00%                                  -0-
         8.01% -15.00%                               50% of % increase in net income
         15.01% - 25.00%                             75% of % increase in net income
         25.0% and up                                100% of % increase in net income up
                                                     to 50% of Base Salary
</TABLE>

The current year's Base Salary shall be multiplied  times the Performance  Bonus
percentage earned in the applicable year. The maximum Performance Bonus that may
be paid for any year is 50% of that  year's  Base  Salary.  For  years  2001 and
after, the Performance  Bonus will be subject to shareholder  approval.  If such
approval is not received,  the Company agrees to provide  Executive with similar
substitute compensation agreeable to the Company and Executive.

               (iii).  Items of a  non-recurring  nature may be  excluded in the
          calculations as mutually agreed to by the Company and the Executive.

          (e).  Reimbursements.  The Company shall also reimburse Executive,  in
     accordance  with such  policies and  procedures  as the Board may establish
     from time to time, for all reasonable travel and other expenses incurred by
     Executive  in the  performance  of his  obligations  under this  Agreement.
     Executive  shall also be  entitled  to  participate  in all  benefit  plans
     established by the Company for which Company executives are or shall become
     eligible.

     5. Termination of Employment.  Executive's  employment under this Agreement
may be terminated by the Company or Executive as follows:

          (a).  Disability.

               (i) If  Executive  fails to perform any of his duties  under this
          Agreement  on account of  Disability  (as  hereinafter  defined),  the
          Company may give notice to Executive to terminate  this Agreement on a
          date not less  than one  hundred  and  eighty  (180)  days  thereafter
          ("Notice  Period") and, if Executive has not resumed full  performance
          of his duties under this  Agreement  within such Notice  Period,  then
          Executive's employment under this Agreement will terminate on the date
          provided   in   the   notice    ("Disability    Termination    Date").
          Notwithstanding  the above, the Executive is specifically  entitled to
          receive all benefits in Section 5(a)(ii).

               (ii).  Executive shall be paid his Base Salary and Chairman's Fee
          by the Company during the Notice Period. Within thirty (30) days after
          the Disability  Termination  Date,  the Company shall pay  Executive's
          Base Salary and  Chairman's  Fee as then in effect that has accrued to
          the last day of the month in which  the  Disability  Termination  Date
          occurs as well as any other  payments or benefits  that  Executive  is
          entitled  to as an employee of the  Company.  Executive  shall also be
          entitled  to receive a fully  vested  retirement  benefit  and a fully
          vested  annuity  and tax  gross  up  retirement  benefit  pursuant  to
          Sections  5(d) and 5(h) and  health  insurance  benefits  pursuant  to
          Section 8 below.

               (iii).  Until  the end of the last day of the  month in which the
          Disability Termination Date occurs, the Company shall maintain and pay
          for health and other  insurance  benefits for Executive at least equal
          to those he had at the commencement of such Disability.

               (iv). As used in this Agreement, the term "Disability" shall mean
          the  inability  of  Executive  to perform all of his duties under this
          Agreement by reason of his medical,  mental, or emotional  disability,
          as determined by an independent  physician  selected with the approval
          of the Board and Executive.

          (b). Death. If Executive dies while employed under this Agreement, his
     employment  under this Agreement will terminate as of the date of his death
     ("Date of Death").  Within  thirty  (30) days after the Date of Death,  the
     Company shall pay to  Executive's  legal  representative  Executive's  Base
     Salary and  Chairman's  Fee as then in effect  that has accrued to the last
     day of the  month in which  the Date of Death  occurs  as well as any other
     payments or benefits  that  Executive  is entitled to as an employee of the
     Company. If the Executive dies while receiving payments pursuant to Section
     5(c) below,  said payment shall continue for the period remaining and shall
     be paid to the  estate or named  beneficiary  of the  Executive.  Executive
     shall receive a fully vested retirement  benefit and a fully vested annuity
     and tax gross up retirement  benefit pursuant to Sections 5(d) and 5(h) and
     health  insurance  benefits  pursuant  to  Section 8 below.  On the Date of
     Death,  all granted stock options shall  immediately  vest and  Executive's
     heirs or estate shall be treated as if  Executive  remained an employee for
     exercise purposes  consistent with the terms of the applicable stock option
     plan.

          (c).  Certain Other Events of  Termination.

               (i) In the  event  that (A) the  Company  terminates  Executive's
          employment for any reason (other than because of death, Disability, or
          "just  cause"  (as  defined  below),  (B) the  term of this  Agreement
          expires  and the  Company  does not  offer to extend  the  Executive's
          employment  in  a  similar  capacity,  (C)  Executive  terminates  his
          employment with the Company  because of the Company's  material breach
          of this  Agreement,  (D) Executive  terminates his employment with the
          Company  because the Company  requires  Executive to be based anywhere
          other than Executive's  current location or within  seventy-five miles
          (75) round trip of the Company's current principal  executive offices,
          or (E) Executive terminates his employment with the Company because of
          a substantial reduction of his duties and  responsibilities,  then the
          Executive  shall be entitled to the  severance  benefits  described in
          Section  5(c)(ii)  below.  The date of termination  under this Section
          5(c)(i) shall be referred to as the  "Executive  Termination  Date" in
          this Agreement.

               (ii).  Upon the  occurrence  of an  event  described  in  Section
          5(c)(i) above, the Executive shall be entitled to the following:

                    (A). The Company  shall pay the Executive an amount equal to
               two year's Base Salary as in effect on the Executive  Termination
               Date plus a two year  Chairman's  Fee with the total amount being
               paid in  equal  bi-weekly  payments  over a period  of two  years
               commencing  on the Executive  Termination  Date and in accordance
               with regular payroll practices of the Company;

                    (B). The Company shall also pay the Executive the sum of the
               maximum  bonus  under the  senior  management  Bonus  Plan of the
               Company and the maximum  Performance  Bonus that Executive  could
               have been entitled to had he been  employed  until the end of the
               year of termination  using the assumption that the parameters for
               earning  maximum bonuses were met for that year regardless of the
               actual  performance  of the Company.  Such bonus  payments  shall
               occur when  bonuses  are  normally  paid by the Company but in no
               event later than February 28 of the applicable year; and

                    (C).  All stock  options  which  Executive  has been granted
               shall immediately vest and become  exercisable.  For the purposes
               of the time period  available for exercising  such stock options,
               Executive  shall be considered to be in the continuous  employ of
               the Company unless terminated pursuant to subsection (e) below.

                    (D).  If the  Executive  becomes  entitled  to the  benefits
               provided in this Section 5(c)(ii), such benefits shall be in lieu
               of any other  severance  benefit  that the Company may provide or
               adopt except that the  Executive  shall be entitled to any vested
               retirement  benefits  including  a fully  vested  annuity and tax
               gross up retirement benefit provided under Sections 5(d) and 5(h)
               whether or not the  Executive  is vested in those  benefits as of
               the Executive  Termination Date and health insurance as set forth
               in  Section 8 below.  Nothing  in this  section  shall  limit the
               discretion of the Board to grant Executive additional benefits.

          (d).  Retirement.

               (i).  Retirement benefits shall be payable to Executive beginning
          on the day Executive  attains age sixty-two (62), (1) if he is at that
          time  still  employed  by the  Company,  and he elects to retire  from
          employment with the Company,  or (2) he is not at the time employed by
          the  Company,  and  elects  to begin  receiving  retirement  benefits.
          Notwithstanding the above provision, the Executive and the Company may
          agree that the  Executive  may  continue to be employed by the Company
          and not to retire at age 62. In addition,  the  Executive may elect an
          early  retirement  and may elect to receive  payment of the retirement
          benefit  at  anytime  after  attaining  age  55 but  before  age 62 by
          providing written notice to the Company. Such early retirement benefit
          will be  actuarially  adjusted  solely  for actual  retirement  age as
          described in Section  5(d)(ii) below.  The date on which the Executive
          retires shall be referred to as the "Retirement Termination Date".


               (ii). If Executive retires on or after reaching age 62, Executive
          will be entitled  to receive  from the  Company a  retirement  benefit
          which will  provide an annual  lifetime  benefit in an amount equal to
          three percent of the average  annual Base Salary,  Chairman's  Fee and
          all bonus compensation for the two years with the highest compensation
          beginning on or after January 1, 1999 times the total number of months
          of service with the Company,  including all months prior to January 1,
          1999,  which  shall be divided by 12 to a limit of 60% of  Executive's
          total compensation which is defined as the total amount of annual Base
          Salary,   annual  total  Chairman's  Fee  and  maximum  annual  senior
          management bonus and Performance  Bonus (using the assumption that the
          parameters for earning maximum bonus were met for that year regardless
          of the actual  performance of the Company) that  Executive  could have
          earned in the calendar year of  Executive's  termination of employment
          with the Company.  For the purposes of determining  the two years with
          the highest  compensation under this paragraph,  compensation shall be
          based on all wages, Chairman's Fees, salaries and bonus amounts earned
          in an applicable  year rather than paid in that year. In addition,  in
          the event of a Change in  Control as  defined  in  Section  5(g),  the
          Executive  shall have been  considered to have earned the total amount
          of annual Base Salary,  annual total Chairman's Fee and maximum annual
          senior  management  bonus and Performance  Bonus (using the assumption
          that the parameters  for earning  maximum bonus were met for that year
          regardless  of  the  actual  performance  of  the  Company)  that  the
          Executive  could  have  earned in the  calendar  year of the Change in
          Control and for the purposes of calculating the Executive's retirement
          benefit,  such year shall be  considered in the  determination  of the
          Executive's two years with highest compensation.  However, in no event
          will the lump sum payment provided in Section 5(g)(2) be considered as
          compensation  under the  calculation of the  retirement  benefit under
          this  paragraph.  In the event of a Change in Control,  an  additional
          twenty-four  (24) month  period  shall be added to the total months of
          service  for the purpose of  calculating  the  Executive's  retirement
          benefit under this paragraph. If Executive elects early retirement and
          retires  after  reaching age 55 but before age 62, the annual  payment
          shall be adjusted so that the total amount of  retirement  benefits to
          be paid do not exceed the  actuarial  equivalent  of the amount  which
          would then have been  payable in  retirement  benefits  had  Executive
          reached  and  retired  at age 62.  For  the  purposes  of  determining
          actuarial equivalency,  the retirement benefit will be reduced by .25%
          (.0025)  per month for each month that the  actual  retirement  age is
          below age 62. The retirement benefit shall be indexed for inflation.

               (iii).  Pursuant to the terms of the Executive's prior employment
          contract with the Company, all retirement benefits have fully vested.

               (iv). At any time, Executive may elect a beneficiary to receive a
          survivor  benefit upon the Retirement  Termination  Date. If Executive
          dies  prior  to  retirement   without  naming  a   beneficiary,   then
          Executive's   surviving  spouse  shall  be  deemed  to  be  his  named
          beneficiary or if Executive has no surviving  spouse, to his issue per
          stirpes.

               (v). If  Executive  is employed by the Company on the  Retirement
          Termination  Date,  the Company shall pay to Executive his Base Salary
          and  Chairman's Fee as then in effect that has accrued to the last day
          of the month in which the  Retirement  Termination  Date  occurs,  any
          payment or benefit that Executive is entitled to as an employee of the
          Company,  and any  non-reimbursed  business  expenses.  The retirement
          benefit  payable  under this Section 5(d) is in addition to, and shall
          not be offset  against,  any other  retirement  benefits  to which the
          Executive  may  be  entitled  under  any  qualified  or  non-qualified
          retirement or deferred compensation plan of the Company.

          (e). Termination by the Company for Just Cause

               (i). The Company may terminate  Executive's  employment for "Just
          Cause" at any time by giving  written  notice  thereof  to  Executive.
          (Except as provided below,  the date of such notice is the "Just Cause
          Termination  Date" unless  otherwise  provided in the notice).  Within
          thirty (30) days after the Just Cause  Termination  Date,  the Company
          shall pay to Executive his Base Salary and  Chairman's  Fee as then in
          effect that has accrued to the Just Cause Termination Date, as well as
          any payment or benefit that Executive is entitled to as an employee of
          the  Company,  and  any  non-reimbursed  business  expenses.  For  the
          purposes of this  subparagraph,  "Just Cause"  shall mean  termination
          because  of   Executive's   willful   and   intentional   business  or
          professional misconduct, breach of fiduciary duty, intentional failure
          to  perform   stated  duties  other  than  such  failure  due  to  his
          disability,  the  conviction  of Executive of a felony,  or a material
          breach of any  provision of this  Agreement.  For the purposes of this
          paragraph,  no act,  or failure to act, on  Executive's  part shall be
          deemed  "willful" unless done, or omitted to be done, by Executive not
          in good  faith  and  without  reasonable  belief  that his  action  or
          omission was in the best  interests of the Company.  Unless  otherwise
          determined  by the  Board,  Executive  shall  have no right to receive
          compensation   or  other  benefits   under  this  Agreement   after  a
          termination for Just Cause except for vested  retirement  benefits and
          any vested annuity and tax gross up retirement benefit as described in
          Sections  5(d) and 5(h),  any stock options that have vested up to and
          including the Just Cause  Termination Date and health insurance as set
          forth in Section 8 below.

               (ii).  Notwithstanding the foregoing,  the Executive shall not be
          deemed to have been  terminated  for Just  Cause  unless and until the
          occurrence of the following two events:

                    (A).  The  Executive  is  given a notice  from the  Board of
               Directors  of  the  Company  that   identifies   with  reasonable
               specificity  the  grounds  for the  proposed  termination  of the
               Executive's  employment  and notifies the Executive that he shall
               have an opportunity to address the Board with his counsel present
               and  entitled  to address  the Board with  respect to the alleged
               grounds for termination at a meeting of the Board called and held
               for the purpose of determining  whether the Executive  engaged in
               conduct described in Section 5(e)(i). The notice shall, except as
               is otherwise provided in the last sentence of the subsection (i),
               provide  the  Executive  with  thirty (30) days from the day such
               notice  is given  to cure  the  alleged  grounds  of  termination
               contained  in  this  Agreement.  The  Board  of  Directors  shall
               determine,  reasonably  and in good faith,  whether the Executive
               has effectively cured the alleged grounds of termination.  If, in
               the reasonable  good faith opinion of the Board,  the grounds for
               termination  under Section 5(e)(i) may not reasonably be cured by
               the  Executive,   then  the  notice   required  by  this  Section
               5(e)(ii)(A) need not provide for any cure period; and

                    (B). The Executive is given a copy of certified resolutions,
               duly adopted by the affirmative  vote of not less than a majority
               of the entire  membership of the Board  (excluding the Executive,
               if  applicable) at a meeting of the Board called and held for the
               purpose of finding that, in the reasonable  good faith opinion of
               a majority of the Board,  the Executive was guilty of conduct set
               forth in Section 5(e)(i), which specify in detail the grounds for
               termination  and indicate that the grounds for  termination  have
               not been cured within the time limits,  if any,  specified in the
               notice referred to in Section 5(e)(ii)(A).

          (f).  Termination by Executive Without Cause.  Executive may terminate
     this Agreement without cause upon the provision of twelve (12) weeks' prior
     notice to the Company. The date of such termination shall be referred to as
     the  "Without  Cause  Termination  Date"  in this  Agreement.  Upon  such a
     termination,  the Executive  shall receive all the  compensation  including
     bonuses set forth in Section  5(c)(ii)  except that Executive shall receive
     one year's Base Salary and Chairman's Fee instead of two year's Base Salary
     and  Chairman's  Fee and Executive  shall be entitled to receive the vested
     retirement  and  the  portion  of the  vested  annuity  and  tax  gross  up
     retirement  benefit  in  accordance  with  Sections  5(d)  and 5(h) of this
     Agreement which have vested prior to the Executive's  termination  date and
     any other  non-reimbursed  business  expenses  and health  insurance as set
     forth in Section 8 below.  Executive  must comply with Section 6 below.  No
     other payment shall be made to Executive  under this  Agreement  other than
     that provided in this paragraph.

          (g).  Change in Control.  Notwithstanding  any other  provision to the
     contrary,  the following provisions will govern in the event of a Change in
     Control as defined herein.

               (1).  Change in Control shall be deemed to have occurred upon the
          occurrence of any one of the following events:

                    (A).  The  acquisition  in one or more  transactions  by any
               individual,  entity  or group  (within  the  meaning  of  Section
               13(d)(3)  or  14(d)(2)  of the  Exchange  Act) in excess of fifty
               percent  (50%)  of  the  then-outstanding  voting  stock  of  the
               Company;  provided,  however,  that the term  "Change in Control"
               shall not include any such acquisition by any entity with respect
               to  which,  following  such  acquisition,  more  than  50% of the
               then-outstanding  shares of common  stock of such  entity is then
               beneficially  owned,  directly or indirectly by  individuals  and
               entities  who  were  beneficial  owners  of the  then-outstanding
               voting stock of the Company immediately prior to such acquisition
               in   substantially   the  same   proportion  as  their  ownership
               immediately  prior to such  acquisition  of the  then-outstanding
               voting stock of the Company; or

                    (B).   The   consummation   of  a  merger,   reorganization,
               consolidation,  share  exchange,  transfer  of  assets  or  other
               transaction   having   similar   effect   involving  the  Company
               ("Merger"),  unless,  following such Merger,  stock possessing at
               least fifty percent (50%) of the total  combined  voting power of
               the issued and outstanding shares of all classes of Company stock
               of the  corporation  resulting  from such Merger is  beneficially
               owned,  directly or indirectly,  by individuals  and entities who
               were beneficial  owners of the  then-outstanding  voting stock of
               the Company immediately prior to such Merger in substantially the
               same  proportion  as their  ownership  immediately  prior to such
               Merger; or

                    (C).  Consummation of a complete  liquidation or dissolution
               of the Company.

               (2).  In the event of a Change in  Control  as defined in Section
          5(g)(1)  above,  the  Executive  shall be  entitled  to the  following
          benefits  regardless  of whether  Executive  remains  employed  by the
          Company,  terminates his employment with the Company, or is terminated
          after the Change in Control:

                    (A).  The Company  shall pay the  Executive in a single lump
               sum  cash  payment  at the  time  of  Closing  (i.e.,  the  legal
               consummation  of the Change in  Control)  an amount  equal to two
               times the sum of (1) the  Executive's  Base Salary and Chairman's
               Fee; and (2) the maximum  Performance  Bonus that Executive could
               have earned for the year in which such  Change in Control  occurs
               (50% times the  then-current  Base Salary as defined in Section 4
               above);  and (3) the maximum annual senior  management  bonus the
               Executive  could  have  earned  using  the  assumption  that  the
               parameters  for  earning  maximum  bonus  were met for that  year
               regardless  of the actual  performance  of the Company  under the
               applicable  Bonus  Plan  for the  year in which  such  Change  in
               Control  occurs in lieu of  payment  under the Bonus  Plan.  Upon
               payment  of the lump  sum  provided  under  the  subsection,  the
               obligation  of  the  Company  to  employ   Executive  under  this
               Agreement shall cease;

                    (B).  All stock  options  which  Executive  has been granted
               shall immediately vest and become  exercisable in accordance with
               the applicable option plan and agreements;

                    (C). The Company  shall pay to the  Executive at the time of
               Closing  an  amount  equal  to the  sum of (x) any  excise  taxes
               imposed  on the  Executive  under  Section  4999 of the  Internal
               Revenue  Code and (y) income  taxes due from the  Executive  with
               respect to the  payment of the amount in (x) above as well as the
               payment for income taxes under this  subsection  5(g)(2)(C).  The
               determination  of  whether an excise tax is due in respect of any
               payment or  benefit,  the amount of the excise tax and the amount
               of  the  gross-up   payment  shall  be  made  by  an  independent
               accountant  jointly selected by the Company and the Executive and
               paid by the  Company.  If the  Executive  and the Company  cannot
               agree on the firm to serve as the accountant,  then the Executive
               and the  Company  shall  each  select one  nationally  recognized
               accounting  firm and those two firms  shall  jointly  select  the
               nationally  recognized  accounting  firm to serve as the auditor;
               and

                    (D). The Company shall purchase for the Executive an annuity
               as set forth in  Section  5(h)  below  based on the fully  vested
               retirement  benefit  provided  in  Section  5(d)  above.  For the
               purposes of calculating  the amount of such  retirement  benefits
               under Section  5(d)(ii),  an additional  twenty-four  (24) months
               shall be added to the total number of months of service Executive
               shall have worked for the Company and, in addition, the Executive
               shall have been  considered  to have  earned the total  amount of
               annual  Base  Salary,  annual  total  Chairman's  Fee and maximum
               annual senior  management bonus and Performance  Bonus (using the
               assumption that the parameters for earning maximum bonus were met
               for  that  year  regardless  of  the  actual  performance  of the
               Company)  that the  Executive  could have earned in the  calendar
               year of the Change in Control  and such year shall be  considered
               in the  determination  of the  Executive's two years with highest
               compensation  under Section 5(d)(ii).  However,  in no event will
               the lump sum payment provided in Section 5(g)(2) be considered as
               compensation  under the  calculation  of the  retirement  benefit
               under this paragraph.

               (3). The payment of any benefits described in Section 5(g)(2) and
          5(h) of this Agreement  shall become the joint and several  obligation
          and  responsibility  of the  Company  and  the  successor  company  or
          "person"  noted in  Section  5(g)  above if  applicable.

               (4). If the Executive  becomes entitled to the benefits  provided
          under Section  5(g)(2)  above,  such benefits  shall be in lieu of any
          other  severance or similar  benefits that would  otherwise be payable
          under any other  agreement,  plan,  program or policy of the  Company;
          provided, however, that this section shall not apply to any retirement
          benefit  under  Sections 5(d) and 5 (h) herein and shall not be offset
          against any other  retirement  benefits to which the  Executive may be
          entitled under any qualified or  non-qualified  retirement or deferred
          compensation plan of the Company.

          (h). Annuities. Upon termination of the Executive's employment for any
     reason under this Section 5, the Company shall  purchase for his benefit an
     annuity that guarantees the payment of the earned  retirement  benefits for
     the life of Executive and the life of his beneficiary  should he predecease
     such beneficiary.  The annuity must be issued by a Company with at least an
     A+ rating  from  Best's  or a AA rating  from  Standard  & Poor's.  For the
     purposes of the purchase of such an annuity,  the  Executive  may elect the
     commencement  date of the annuity  payment.  Such annuity must be purchased
     within 90 days of termination  except in the case of a Change in Control as
     defined  below in which case the annuity must be purchased by the successor
     company prior to Closing  unless an alternate  date of purchase is mutually
     agreed to in  writing  by the  Company,  the  Executive  and the  successor
     company.  The parties  recognize  that the amount the Company or  successor
     company pays for the annuity will be taxable  income to the  Executive  and
     the Company or successor  company agrees to reimburse the Executive for all
     taxes,  including  taxes on the tax gross up, related to said purchase upon
     the  following  vesting  schedule:  50%  vesting  upon  execution  of  this
     Agreement;  100%  vesting on 1/1/02  and 100%  immediate  vesting  upon any
     Change in Control, death or Disability. In the case of a Change in Control,
     for the purposes of  calculating  any  actuarial  reduction in payments for
     early retirement in the value of the annuity, the Executive shall be deemed
     to be the greater of (1) age 55 or (2) Executive's actual age, plus 2 years
     and the  annuity  will  commence  retirement  payments  when the  Executive
     attains the age of 55.

     6.  Covenant  Not to  Compete.  Executive  covenants  and agrees  that,  in
consideration of the amounts to be paid Executive under this Agreement and other
good and valuable consideration, for a period of one (1) year beyond the Without
Cause Termination Date,  Executive shall not be employed as an executive officer
of, or control,  manage,  or  otherwise  participate  in the  management  of the
business  of a  "significant  competitor"  of the Company  within the  Company's
service  area.  The term  "significant  competitor"  shall  mean any  company or
division of a company  that,  on the  Executive  Termination  Date,  directly or
indirectly, is materially (10% or more of its revenues) engaged in the operation
or  management  of a  health  maintenance  organization  or  any  other  similar
provider, payer or insurer for medical services. The Company and Executive agree
that the terms and conditions of this Section 6 shall survive the termination of
this Agreement following the Without Cause Termination Date.

     7. Business Automobile.  The Company shall pay to Executive a car allowance
of not less than $450 per month during the term of this Agreement.

     8. Health  Insurance.  Upon  termination  of this Agreement for any reason,
including but not limited to, retirement,  death, Disability, Change of Control,
or termination  of Executive  with or without cause,  both the Executive and the
spouse of the Executive and in the event of the Executive's death, the surviving
spouse of the  Executive  will receive or be provided  health  coverage from the
Company or its successor during the term of their respective  lives. Such health
coverage  shall be  equivalent  to that provided to the Executive on the date of
termination  and shall be paid for by Executive  or the spouse of the  Executive
with the normal Company  contribution for active employees in effect at the date
of termination.

     9. Confidential Information. Executive shall fully comply with and abide by
the provisions of the Company's  Employee Manual and other announced policies in
effect from time to time,  including those provisions relating to the protection
of the Company's confidential information.  The Company and Executive agree that
the foregoing  provision shall survive the termination of this Agreement for any
reason whatsoever.

     10. Indemnification.  Executive shall be entitled to indemnification to the
full extent provided for or allowed by applicable law, including indemnification
for  administrative  and criminal  matters,  irrespective  of insurance,  and to
advances  for  expenses  in  defending  against  such  claims.  The  Company and
Executive  agree that the foregoing  provision  shall survive the termination of
this Agreement for any reason whatsoever.  Notwithstanding  the above, the Board
shall have the  discretion  not to reimburse or indemnify  the Executive for any
expenses related to a just cause  termination as defined in Section 5(e) wherein
such action or omission was done,  or omitted to be done,  by  Executive  not in
good faith and without  reasonable belief that his action or omission was in the
best interests of the Company.

     11. Anti-Disparagement.  Upon termination of this Agreement for any reason,
both parties agree not to make disparaging or disrespectful  comments about each
other  orally or in writing or through  any other  medium to any  individual  or
entity, professional or trade association, regulator, competitor or media.

     12. Nonsolicitation.  For a period ending one year after any termination of
this  Agreement,  the Executive  shall not,  directly or indirectly,  induce any
person in the  employment  of the Company or any  subsidiary or affiliate of the
Company away from the Company or any  subsidiary  or affiliate of the Company to
accept employment or enter into any consulting arrangement with the Executive or
any entity with which Executive is associated.

     13. General Provisions.

          (a) Entire Agreement. This Agreement contains the entire understanding
     between the parties hereto and supersedes  any prior  employment  agreement
     between the Company and Executive.

          (b) No Duty to Mitigate.  Executive  shall not be required to mitigate
     the amount of any payment  provided for in this  Agreement by seeking other
     employment  or  otherwise,  nor  shall  any  amounts  received  from  other
     employment or otherwise by Executive  offset in any manner the  obligations
     of the Company hereunder.

          (c)  Nonassignability.  Neither this Agreement nor any right,  remedy,
     obligation or liability arising hereunder or by reason hereof is assignable
     by  Executive,  his  beneficiaries,  or legal  representatives  without the
     Company's prior written consent;  provided,  however,  that nothing in this
     Section 11(c) shall preclude (i) Executive  from  designating a beneficiary
     to receive  any  benefit  payable  hereunder  upon his  death,  or (ii) the
     executors,  administrators,  or other legal representatives of Executive or
     his estate from  assigning  any rights  hereunder  to the person or persons
     entitled thereto.

          (d)  Notices.  All  notices  and  other  communications   required  or
     permitted to be given under this Agreement shall be in writing and shall be
     deemed to have been duly given if delivered personally or sent by certified
     mail, return receipt requested, first-class postage prepaid, to the parties
     to this Agreement at the following addresses:

               (i) if to the Company at:
                   Mid Atlantic Medical Service, Inc.
                   4 Taft Court
                   Rockville, MD 20850

                   and

               (ii) if to  Executive  at the address set forth on the  signature
          page or to such other address as either party to this Agreement  shall
          have last designated by notice to the other party.

         All such  notices  and  communications  shall be  deemed  to have  been
received on the earlier of the date of receipt or the third  business  day after
the date of mailing thereof.

          (e) Binding Effect; Benefits. This Agreement shall be binding upon and
     inure to the benefit of the parties to this Agreement and their  respective
     successors and permitted  assigns.  Nothing in this  Agreement,  express or
     implied,  is intended or shall be construed to give any person,  other than
     the parties to this Agreement or their  respective  successors or permitted
     assigns, any legal or equitable right, remedy, or claim under or in respect
     of any agreement or any provision contained herein.

          (f) Waiver.  No provision of this  Agreement  may be amended,  waived,
     discharged,  or terminated  except by an instrument in writing and executed
     by each party. Any waiver of enforcement of any provision of this Agreement
     shall not operate or be construed as a continuing waiver or a waiver of any
     other provisions unless expressly stated in such instrument.

          (g) Amendment. This Agreement may be terminated, amended, modified, or
     supplemented  only by a written  instrument  executed by Executive  and the
     Company.

          (h) Governing Law. This  Agreement  shall be governed by and construed
     in accordance with the law of the State of Delaware,  regardless of the law
     that might be applied under principles of conflict of laws.

          (i) Severability.  If, for any reason, any provision of this Agreement
     is held invalid,  such  invalidity  shall not affect any other provision of
     this Agreement not held so invalid, and each such other provision shall, to
     the full extent  consistent with law, continue in full force and effect. If
     any  provision  of this  Agreement  shall be held  invalid  in  part,  such
     invalidity  shall in no way affect the rest of such  provision  not held so
     invalid, and the rest of such provision, together with all other provisions
     of this Agreement, shall to the full extent consistent with law continue in
     full force and effect.

     IN WITNESS  WHEREOF,  the Company has caused this  Agreement to be executed
and its seal to be affixed  hereunto by its officers  thereunto duly authorized,
and Executive has signed this Agreement, all as of the Effective Date.

ATTEST:                                      MID ATLANTIC MEDICAL SERVICES, INC.
By: /s/ Sharon C. Pavlos                     By: /s/ Thomas P. Barbera
Name:  Sharon C. Pavlos                      Name: Thomas P. Barbera
(Corporate Seal)                             Title:  Chief Executive Officer

APPROVED BY:                                 EXECUTIVE:  Mark D. Groban, M.D.
Compensation Committee                       By: /s/ Mark D. Groban
By: /s/ John P. Mamana, M.D.                 Address: 4 Taft Court
Name:  John P. Mamana, M.D.                           Rockville, MD  20850
Title:  Chairman

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