FORM OF EMPLOYMENT AGREEMENT
         THIS  AGREEMENT,  made and entered as of this ___ day of _______,  1998
("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  ______________,   an  individual
residing at ______________________________________ ("Executive");
         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 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  herein
contained, 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 a Senior  Vice  President  of the Company on the
conditions  hereinafter  set forth.  Executive  agrees to perform such  services
consistent  with his or her  position  as shall from time to time be assigned to
him by the Company's Chief Executive  Officer,  the Company's Board of Directors
("Board"), or another executive designated by the Board. Such duties may include
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 or her
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 (i) shall  commence for an initial  period as of the Effective  Date and
remain in effect for one year.

     4. Compensation and Reimbursement of Expenses. For all services rendered by
Executive in any 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  (A)
an annual salary ("Base Salary") and (B) such bonus for such period,  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 or otherwise awarded by the Board or by
a committee  designated  by the Board.  Unless and until  adjusted in accordance
with regular Company  compensation  policies,  Base Salary shall be not less the
rate at which  Executive is compensated on the Effective Date. 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 her or her  obligations
under this  Agreement.  Executive  shall also be entitled to  participate in any
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 his or her 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 thirty (30) days thereafter  ("Notice  Period") and,
         if  Executive  has not resumed  full  performance  of his or her 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").
                  (ii)  During  any  period of  Disability,  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.
                  (iii) As used in this Agreement,  the term "Disability"  shall
         mean the  complete  inability of Executive to perform his or her duties
         under  this  Agreement  by reason  of his or her  total  and  permanent
         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
     or her employment under this Agreement will terminate as of the date of his
     or her 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 as then in effect that has accrued to the last day
     of the month in which the Date of Death occurs. 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 of the
     Executive.

          (c) Certain  Other  Events of  Termination.  In the event that (i) the
     Company  terminates  Executive's  employment  for any  reason  (other  than
     because of death,  Disability,  or "just cause" (as  hereinafter  defined),
     (ii) Executive terminates his or her employment with the Company because of
     the Company's material breach of this Agreement, (iii) Executive terminates
     his or her employment with the Company because  Executive's Base Salary, is
     reduced by an amount greater than 25% over the initial term of the contract
     from the amount on the Effective Date, (iv) Executive terminates his or her
     employment  with the Company because the Company  requires  Executive to be
     based  anywhere  other  than   Executive's   current   location  or  within
     seventy-five  (75)  miles  of the  Company's  principal  executive  offices
     (except for required  travel on the Company's  business),  or (v) Executive
     terminates his or her employment  with the Company because of a substantial
     reassignment  of duties and  responsibilities,  then the Company  shall pay
     Executive an amount equal to 12 months Base Salary paid in equal  bi-weekly
     payments over a period of one year commencing on the Executive  Termination
     Date and in accordance with the regular  payroll  practices of the Company.
     Payment  made  pursuant to this  paragraph  shall be the  exclusive  remedy
     provided  to  Executive  and  Executive  shall not be entitled to any other
     severance benefit that the Company may provide or adopt.

          (d)  Retirement.  Executive  shall be entitled to terminate his or her
     employment with the Company on, or at any date after, a date on which he is
     at least  sixty-five (65) years old. Any date on which Executive  elects to
     retire  shall be  referred  to as the  "Retirement  Termination  Date." The
     Company  shall pay to  Executive  his or her Base  Salary as then in effect
     that  has  accrued  to the last day of the  month in which  the  Retirement
     Termination Date occurs.


          (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 or her
               Base  Salary as then in effect that has accrued to the Just Cause
               Termination  Date. For the purposes of this  subparagraph,  "just
               cause" shall mean  termination  because of  Executive's  personal
               dishonesty,   willful  misconduct,   breach  of  fiduciary  duty,
               intentional  failure to perform stated duties,  willful violation
               of any law, rule or regulation (other than traffic  violations or
               similar  offenses),  or material  breach of any provision of this
               Agreement.  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.

                    (ii)  Notwithstanding the foregoing,  Executive shall not be
               deemed to have been  terminated  for just cause  pursuant to this
               Section 6(e) unless and until he shall have  received a copy of a
               resolution duly adopted by the affirmative  vote of a majority of
               the Board, at a meeting held for that purpose,  declaring that in
               the good faith opinion of the Board one or more of the conditions
               set forth in clause (i) of this  Section  6(e) has  occurred  and
               specifying the particulars thereof

     6. 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. 

     7.  Covenant  Not To  Compete.  Executive  covenants  and agrees  that,  in
consideration  of the amounts to be paid Executive  hereunder and other good and
valuable  consideration,  for a period  of one (1)  year  beyond  the  Executive
Termination  Date,  Executive shall not be employed as an executive  officer of,
control, manage, or otherwise participate in the management of the business of a
"significant competitor" of the Company. The term "significant competitor" shall
mean any company or division of a company that, on Effective  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 7 shall survive the termination of
this Agreement following the Termination Date.

     8.  Indemnification.  Employee shall be entitled to  indemnification to the
full extent allowed by the Company's Certificate of Incorporation and Bylaws for
third  party  claims and to advances  for  expenses in  defending  against  such
claims.

     9.  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 or her  beneficiaries,  or  legal  representatives  without  the
Company's prior written consent; provided, however, that nothing in this Section
11(d) shall preclude (i) Executive from designating a beneficiary to receive any
benefit  payable  hereunder  upon  his or her  death,  or  (ii)  the  executors,
administrators, or other legal representatives of Executive or his or her 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:
(Corporate Seal)                            Name:
                                            Title:
WITNESS                                     EXECUTIVE:



                                           Address: __________________________