Document:

Exhibit 10.1

    
      

    

    Back
      to Form 8-K

     

    Exhibit
      10.1

     

     

    

    MEDICAID
      MANAGED CARE MODEL CONTRACT

    

    Amendment
      of Agreement 

    Between
      

    City
      of
      New York 

    And

    WellCare
      of New York, Inc.

     

    This
      Amendment, effective January 1, 2007, amends the Medicaid Managed Care Model
      Contract (hereinafter referred to as the "Agreement") made by and between the
      City of New York acting through the New York City Department of Health and
      Mental Hygiene (hereinafter referred to as "DOHMH" or "LDSS") and WellCare
      of
      New York, Inc. (hereinafter referred to as "Contractor" or "MCO").

     

    WHEREAS,
      the
      parties entered into an Agreement effective October 1, 2005, amended April
      1,
      2006, for the purpose of providing prepaid case managed health services to
      Medical Assistance recipients residing in New York City; and

     

    WHEREAS,
      the
      parties desire to amend said Agreement to modify certain provisions to reflect
      current circumstances and intentions;

     

    NOW
      THEREFORE,
      effective January 1, 2007, it is mutually agreed by the parties to amend this
      Agreement as follows:

     

    1.
      The
      attached "Table of Contents" will be applicable for the period beginning
      January 1, 2007.

     

    2.
      Amend
      Section 10.13 "Emergency Services" to read as follows:

     

    10.13
      Emergency Services

     

    a)
      The
      Contractor shall maintain coverage utilizing a toll free telephone number
      twenty-four (24) hours per day seven (7) days per week, answered by a live
      voice, to advise Enrollees of procedures for accessing services for Emergency
      Medical Conditions and for accessing Urgently Needed Services. Emergency mental
      health calls must be triaged via telephone by a trained mental health
      professional.

     

    b)
      The
      Contractor shall advise its Enrollees how to obtain Emergency Services when
      it
      is not feasible for Enrollees to receive Emergency Services from or through
      a
      Participating Provider. The Contractor agrees to inform its Enrollees that
      access to Emergency Services is not restricted and that Emergency Services
      may
      be obtained from a Non-Participating Provider without penalty.

     

    c)
      The
      Contractor agrees to bear the cost of Emergency Services provided to Enrollees
      by Participating or Non-Participating Providers.

     

    d)
      The
      Contractor agrees to cover and pay for services as follows:

     

    i)
      Participating Providers

     

    A)
      Payment by the Contractor for general hospital emergency department services
      provided to an Enrollee by a Participating Provider shall be at the rate or
      rates of payment specified in the contract between the Contractor
      and

    

    

    January
      1, 2007 Amendment

    1

    

    the
      hospital. Such contracted rate or rates shall be paid without regard to whether
      such services meet the definition of Emergency Medical Condition.

     

    B)
      Payment by the Contractor for physician services provided to an Enrollee by
      a
      Participating Provider while the Enrollee is receiving general hospital
      emergency department services shall be at the rate or rates of payment specified
      in the contract between the Contractor and the physician. Such contracted rate
      or rates shall be paid without regard to whether such services meet the
      definition of Emergency Medical Condition.

     

    ii)
      Non-Participating Providers

     

    A)
      Payment by the Contractor for general hospital emergency department services
      provided to an Enrollee by a Non-Participating Provider shall be at the Medicaid
      fee-for-service rate, inclusive of the capital component, in effect on the
      date
      that the service was rendered without regard to whether such services meet
      the
      definition of Emergency Medical Condition.

     

    B)
      Payment by the Contractor for physician services provided to an Enrollee by
      a
      Non-Participating Provider while the Enrollee is receiving general hospital
      emergency department services shall be at the Medicaid fee-for-service rate
      in
      effect on the date the service was rendered without regard to whether such
      services meet the definition of Emergency Medical Condition.

     

    e)
      The
      Contractor agrees that it will not require prior authorization for services
      in a
      medical or behavioral health emergency. Nothing herein precludes the Contractor
      from entering into contracts with providers or facilities that require providers
      or facilities to provide notification to the Contractor after Enrollees present
      for Emergency Services and are subsequently stabilized. The Contractor may
      not
      deny payments to a Participating Provider or a Non-Participating Provider for
      failure of the Emergency Services provider or Enrollee to give such
      notice.

     

    f)
      The
      Contractor agrees to abide by requirements for the provision and payment of
      Emergency Services and Post-stabilization Care Services which are specified
      in
      Appendix G, which is hereby made a part of this Agreement as if set forth fully
      herein.

     

    3.
      Amend
      Section 10.22 "Member Needs Relating to HIV to read as follows:

     

    10.22
      Member Needs Relating to HIV

     

    a)
      The
      Contractor must inform MMC Enrollees newly diagnosed with HIV infection or
      AIDS,
      who are known to the Contractor, of their enrollment options including the
      ability to return to the Medicaid fee-for-service program or to disenroll from
      the Contractor's MMC product and to enrol! into HIV SNPs, if such plan is
      available.

     

    b)
      The
      Contractor will inform Enrollees about HIV counseling and testing services,
      including Rapid HIV Testing, available through the Contractor's Participating
      Provider network; HIV counseling and testing services available when performed
      as part of a Family Planning and Reproductive Health encounter: and anonymous
      counseling and testing services available from SDOH, Local Public Health Agency
      clinics and other county programs Counseling and testing rendered outside of
      a

     

    

    January
      1, 2007 Amendment 

    2

    

    Family
      Planning and Reproductive Health encounter, as well as services provided as
      the
      result of an HIV- diagnosis, will be furnished by the Contractor in accordance
      with standards of care.

     

    c)
      The
      Contractor agrees that anonymous testing may be furnished to the Enrollee
      without prior approval by the Contractor and may be conducted at anonymous
      testing sites. Services provided for HIV treatment may only be obtained from
      the
      Contractor during the period the Enrollee is enrolled in the Contractor's MMC
      or
      FHPlus product.

     

    d)
      The
      Contractor shall implement policies and procedures consistent with CDC
      recommendations as published in the MMWR where consistent with New York State
      laws and SDOH Guidance for HIV Counseling & Testing and New Laboratory
      Reporting Requirements, including:

     

    i)
      Methods for promoting HIV prevention to all Enrollees. HIV prevention
      information, both primary as well as secondary, should be tailored to the
      Enrollee's age, sex, and risk factor(s) (e.g., injection drug use and sexual
      risk activities), and should be culturally and linguistically appropriate.
      HIV
      primary prevention means the reduction or control of causative factors for
      HIV,
      including the reduction of risk factors. HIV Primary prevention includes
      strategies to help prevent uninfected Enrollees from acquiring HIV, i.e.,
      behavior counseling for HIV negative Enrollees with risk behavior. Primary
      prevention also includes strategies to help prevent infected Enrollees from
      transmitting HIV infection, i.e., behavior counseling with an HIV infected
      Enrollee to reduce risky sexual behavior or providing antiviral therapy to
      a
      pregnant, HIV infected female to prevent transmission of HIV infection to a
      newborn. HIV Secondary Prevention means promotion of early detection and
      treatment of HIV disease in an asymptomatic Enrollee to prevent the development
      of symptomatic disease. This includes: regular medical assessments; routine
      immunization for preventable infections; prophylaxis for opportunistic
      .infections; regular dental, optical, dermatological and gynecological care;
      optimal diet/nutritional supplementation; and
      partner notification services which lead to the early detection and treatment
      of
      other infected persons. All Enrollees should be informed of the availability
      of
      HIV counseling, testing, referral and partner notification (CTRPN)
      services.

     

    ii)
      Policies and procedures that promote HIV counseling and testing as a routine
      part of medical care. Such policies and procedures shall include at a
      minimum:

    assessment
      methods for recognizing the early signs and symptoms of HIV disease; initial
      and
      routine screening for HIV risk factors through administration of sexual behavior
      and drug and alcohol use assessments; and the provision of information to all
      Enrollees regarding the availability of HIV CTRPN services, including Rapid
      HIV
      Testing, from Participating Providers or as part of a Family Planning and
      Reproductive Health services visit pursuant to Appendix C of this Agreement,
      and
      the availability of anonymous CTRPN services from New York State, New York
      City
      and the LPHA.

     

    iii)
      Policies and procedures that require Participating Providers to provide HIV
      counseling and recommend HIV testing to pregnant women in their care. Such
      policies and procedures shall be updated to reflect the most current CDC
      recommendations as published in the MMWR where consistent with New York State
      laws and SDOH Guidance on HIV Counseling and Testing. The HIV counseling and
      testing provided shall be done in accordance with Article 27-F of

     

    January
      1, 2007 Amendment

    3

    

    the
      PHL.
      Such policies and procedures shall also direct Participating Providers to refer
      any HIV positive women in their care to clinically appropriate services for
      both
      the women and their newborns.

     

    iv)
      A
      network of providers sufficient to meet the needs of its Enrollees with HIV.
      Satisfaction of the network requirement may be accomplished by inclusion of
      HIV
      specialists within the network or the provision of HIV specialist consultation
      to non-HIV specialists serving as PCPs for persons with HIV infection; inclusion
      of Designated AIDS Center Hospitals or other hospitals experienced in HIV care
      in the Contractor's network; and contracts or linkages with providers funded
      under the Ryan White CARE Act. The Contractor shall inform Participating
      Providers about how to obtain information about the availability of Experienced
      HIV Providers and HIV Specialist PCPs.

     

    v)
      Case
      Management Assessment for Enrollees with HIV Infection. The Contractor shall
      establish policies and procedures to ensure that Enrollees who have been
      identified as having HIV infection are assessed for case management services.
      The Contractor shall arrange for any Enrollee identified as having HIV infection
      and needing case management services to be referred to an appropriate case
      management services provider, including Contractor provided case management,
      and/or, with appropriate consent of the Enrollee, HIV community-based
      psychosocial case management services and/or COBRA Comprehensive Medicaid Case
      Management (CMCM) services for MMC Enrollees.

     

    vi)
      The
      Contractor shall require its Participating Providers to report positive HIV
      test
      results and diagnoses and known contacts of such persons to the New York State
      Commissioner of Health. In New York City, these shall be reported to the New
      York City Commissioner of Health. Access to partner notification services must
      be consistent with 10 NYCRR Part 63.

     

    vii)
      The
      Contractor's Medical Director shall review Contractor's HIV practice guidelines
      at least annually and update them as necessary for compliance with recommended
      SDOH AIDS Institute and federal government clinical standards. The Contractor
      will disseminate the HIV Practice Guidelines or revised guidelines to
      Participating Providers at least annually, or more frequently as
      appropriate.

     

    4.
      Amend
      Section 18.3 ''SDOH Instructions for Report Submissions" to read as
      follows:

    18.3
      SDOH
      Instructions for Report Submissions

     

    SDOH,
      with notice to DOHMH, will provide Contractor with instructions for submitting
      the reports required by SDOH in Section 18.5 of this Agreement, including time
      frames, and requisite formats. The instructions, time frames and formats may
      be
      modified by SDOH upon sixty (60) days written notice to the
      Contractor.

     

    5.
      Delete
      Section 1 8.4 “Liquidated Damages," and renumber Sections 18.5 "Notification of
      Changes in Report Due Dates. Requirements or Formats:" 18.6 "Reporting
      Requirements;" 18.7 "Ownership and Related Information Disclosure:" 18.8 "Public
      Access to Reports;" 18.9 Professional Discipline: 18.10 "Certification Regarding
      Individuals Who Have Been Debarred Or Suspended By Federal. State, or Local
      Government:" 18.1 1 "Conflict of Interest Disclosure:"

     

    

    January
      1, 2007 Amendment

    4

    

    and
      18.12 "Physician Incentive Plan Reporting." as Sections 18.4. 18.5. 18.6, 18.7.
      18.8. 18.9. 18.10, and 18.11 respectively.

     

    6.
      Add
      a
      new Section 22.7 "Recovery of Overpayments to Providers" to read as
      follows:

     

    22.7
      Recovery of Overpayments to Providers

     

    Consistent
      with the exception language in Section 3224-b of the Insurance Law, the
      Contractor shall retain the right to audit participating providers' claims
      for a
      six year period from the date the care, services or supplies were provided
      or
      billed, whichever is later, and to recoup any overpayments discovered as a
      result of the audit. This six year limitation does not apply to situations
      in
      which fraud may be involved or in which the provider or an agent of the provider
      prevents or obstructs the Contractor's auditing.

     

    7.
      Renumber
      Sections 22.7 "Restrictions on Disclosure:" 22.8 "Transfer of Liability:" 22.9
      "Termination of Health Care Professional Agreements:" 22.10 "Health Care
      Professional Hearings:'' 22.11 "Non-Renewal of Provider Agreements:" 22.12
      "Notice of Participating Provider Termination:" and 22.13 "Physician Incentive
      Plan:" as Sections 22.8, 22.9. 22.10, 22.11. 22.12. 22.13. and 22.14
      respectively.

     

    8.
      The
      attached Appendix F "New York State Department of Health Action and Grievance
      System Requirements for MMC and FHPlus Programs" will be applicable for the
      period beginning January 1.2007.

     

    9.
      The
      attached Appendix G ''SDOH Requirements for the Provision of Emergency Care
      and
      Services" will be applicable for the period beginning January 1.
      2007.

     

    10.
      The
      attached Appendix K "Prepaid Benefit Package Definitions of Covered and
      Non-Covered Services" will be applicable for the period beginning January 1.
      2007.

     

    11.
      Amend
      Subsections 4 (a). 4 (b). and 4(c) of Section N.4 "Additional Reporting
      Requirements" of Appendix N "New York City Specific Contracting Requirements"
      to
      read as follows:

     

    a)
      The
      Contractor shall provide DOHMH with all reports submitted to SDOH pursuant
      to
      Sections 18.5(a)(i), (ii), (vi), (vii) and (xii) of this Agreement.

     

    b)
      Upon
      request by DOHMH, the Contractor shall submit to DOHMH reports submitted to
      SDOH
      pursuant to Section 18.5(a) (iii) and Section 18.5(a) (xi) and/or Section 23.2
      of this Agreement.

     

    c)
      To
      meet the appointment availability review requirements of Section 18.5(a)(ix),
      the Contractor shall conduct a service area specific review of appointment
      availability for two specialist types, to be determined by DOHMH, semi-annually.
      Reports on the results of such surveys must be kept on file by the Contractor
      and be readily available for review by SDOH and DOHMH, and submitted to the
      DOHMH

    

    

    January
      1, 2007 Amendment

    5

     

    

    

    12.
      The
      attached Schedule 1 "DOHMH Public Health Service Fee Schedule 1
      of
      Appendix N New York City Specific Contracting Requirements" will be applicable
      for the period beginning January 1.2007.

     

    All
      other
      provisions of said AGREEMENT shall remain in full force and effect.

    

    

    

    January
      1, 2007 Amendment

    6

    

    This
      Amendment is effective January 1, 2007 and the Agreement, including the
      modifications made by this Amendment and previous Amendments, shall remain
      in
      effect until September 30, 2007 or until an extension, renewal or successor
      Agreement is entered into as provided for in the Agreement.

     

    IN
      WITNESS WHEREOF, the parties have duly executed this Amendment to the Agreement
      on the dates appearing below their respective signatures.

     

    

    

     

    

    
      	
              CONTRACTOR

            	 	
              CITY
                OF NEW YORK

            
	
              By:
                     
                /s/ Todd S.
                Farha          
                 

            	 	
              By:  
                /s/
                Andrew Rein          
                 

            
	
              (Signature)

            	 	
              (Signature)

            
	
              Todd
                S. Farha

            	 	
              Andrew
                Rein 

            
	
              Title:
                President & CEO

            	 	
              Title:
                COO/ EDC

            
	
              WellCare
                of New York, Inc.

            	 	 
	
              (Contractor’s
                Name)

            	 	
              NYC
                DOHMH

            
	
              Date:
                January 4, 2007

            	 	
              Date:
                January 31, 2007

            
	 	 	 

    

     

    January
      1, 2007 Amendment 

    7

    

    

    STATE
      OF
      FLORIDA

    SS:

    COUNTY
      OF
      HILLSBOROUGH

    

     

    On
      this
      4th
      Day of
      January, 2007, Todd S. Farha came before me, to me known and known to be the
      President and CEO of WellCare of New York, Inc., who is duly authorized to
      execute the foregoing instrument on behalf of said corporation and s/he
      acknowledged to me that s/he executed the same for the purpose therein
      mentioned. 

     

     

    NOTARY
      PUBLIC

     

    

    

    STATE
      OF
      NEW YORK

    SS:

    COUNTY
      OF
      NEW YORK

    

     

    On
      this
      31 Day of January 2007, Andrew Rein came before me, to me known to be the
      Executive Deputy Commissioner in the New York City Department of Health and
      Mental Hygiene, who is duly authorized to execute the foregoing instrument
      on
      behalf of the City and s/he acknowledged to me that s/he executed the same
      for
      the purpose therein mentioned.

     

    

    NOTARY
      PUBLIC

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    Table
      of Contents for Model Contract

    

    

    Recitals

    Section
      1 Definitions

     

    Section
      2
 Agreement
      Term, Amendments, Extensions, and General Contract Administration
      Provisions

    2.1
      Term

    2.2
      Amendments

    2.3
      Approvals

    2.4
      Entire Agreement

    2.5
      Renegotiation

    2.6
      Assignment and Subcontracting

    2.7
      Termination

    a.
      DOHMH
      Initiated Termination

    b.
      Contractor and DOHMH Initiated Termination

    c.
      Contractor Initiated Termination

    d.
      Termination Due to Loss of Funding

    2.8
      Close-Out Procedures

    2.9
      Rights and Remedies

    2.10
      Notices

    2.11
      Severability

    

    Section
      3
 Compensation

    3.1
      Capitation Payments

    3.2
      Modification of Rates During Contract Period

    3.3
      Rate
      Setting Methodology

    3.4
      Payment of Capitation

    3.5
      Denial of Capitation Payments

    3.6
      SDOH
      Right to Recover Premiums

    3.7
      Third
      Party Health Insurance Determination

    3.8
      Payment for Newborns

    3.9
      Supplemental Maternity Capitation Payment

    3.10
      Contractor's Financial Liability

    3.11
      Inpatient Hospital Stop-Loss Insurance for Medicaid Managed Care (MMC)
      Enrollees

    3.12
      Mental Health and Chemical Dependence Stop-Loss for MMC Enrollees

    3.13
      Residential Health Care Facility Stop-Loss for MMC Enrollees

    3.14
      Stop-Loss Documentation and Procedures for the MMC Program

    3.15
      Family Health Plus (FHPlus) Reinsurance

    3.16
      Tracking Visits Provided by Indian Health Clinics - Applies to MMC Program
      Only

    

    Section
      4
 Service
      Area 

    Section
      5
 Reserved

    

     

    TABLE
      OF
      CONTENTS

    January
      1, 2007

    1

     

    

    Table
      of Contents for Model Contract

     

    Section
      6 Enrollment

    6.1
      Populations Eligible for Enrollment

    6.2
      Enrollment Requirements

    6.3
      Equality of Access to Enrollment

    6.4
      Enrollment Decisions

    6.5
      Auto
      Assignment - For MMC Program Only

    6.6
      Prohibition Against Conditions on Enrollment

    6.7
      Newborn Enrollment

    6.8
      Effective Date of Enrollment

    6.9
      Roster

    6.10
      Automatic Re-Enrollment

     

    Section
      7 Lock-In
      Provisions

    7.1
      Lock-In Provisions in MMC Mandatory Local Social Services Districts and for
      Family Health Plus

    7.2
      Disenrollment During a Lock-In Period

    7.3
      Notification Regarding Lock-In and End of Lock-In Period

    7.4
      Lock-In and Change in Eligibility Status

     

    Section
      8 Disenrollment

    8.1
      Disenrollment Requirements

    8.2
      Disenrollment Prohibitions

    8.3
      Disenrollment Requests

    a.
      Routine Disenrollment Requests 

    b.
      Non-Routine Disenrollment Requests

    8.4
      Contractor Notification of Disenrollments

    8.5
      Contractor's Liability

    8.6
      Enrollee Initiated Disenrollment

    8.7
      Contractor Initiated Disenrollment

    8.8
      LDSS
      Initiated Disenrollment

     

    Section
      9 Guaranteed
      Eligibility

    9.1
      General Requirements

    9.2
      Right
      to Guaranteed Eligibility

    9.3
      Covered Services During Guaranteed Eligibility

    9.4
      Disenrollment During Guaranteed Eligibility

     

    Section
      10  Benefit
      Package Requirements

    10.1
      Contractor Responsibilities

    10.2
      Compliance with State Medicaid Plan and Applicable Laws

    10.3
      Definitions

    10.4
      Child Teen Health Program/Adolescent Preventive Services

    10.5
      Foster Care Children - Applies to MMC Program Only

    10.6
      Child Protective Services

    10.7
      Welfare Reform - Applies to MMC Program Only

    10.8
      Adult Protective Services

    10.9
      Court-Ordered Services

     

     

    TABLE
      OF
      CONTENTS

    January
      1, 2007

    2

     

    

    Table
      of Contents for Model Contract

     

    10.10
      Family Planning and Reproductive Health Services

    10.11
      Prenatal Care

    10.12
      Direct Access

    10.13
      Emergency Services

    10.14
      Medicaid Utilization Thresholds (MUTS)

    10.15
      Services for Which Enrollees Can Self-Refer

    a.
      Mental
      Health and Chemical Dependence Services

    b.
      Vision
      Services

    c.
      Diagnosis and Treatment of Tuberculosis

    d.
      Family
      Planning and Reproductive Health Services

    e.
      Article 28 Clinics Operated by Academic Dental Centers

    10.16
      Second Opinions for Medical or Surgical Care

    10.17
      Coordination with Local Public Health Agencies

    10.18
      Public Health Services

    a.
      Tuberculosis Screening, Diagnosis and Treatment; Directly Observed Therapy
      (TB/DOT) 

    b.
      Immunizations

    c.
      .
      Prevention and Treatment of Sexually Transmitted Diseases 

    d.
      Lead
      Poisoning - Applies to MMC Program Only

    10.19
      Adults with Chronic Illnesses and Physical or Developmental
      Disabilities

    10.20
      Children with Special Health Care Needs

    10.21
      Persons Requiring Ongoing Mental Health Services

    10.22
      Member Needs Relating to HIV

    10.23
      Persons Requiring Chemical Dependence Services

    10.24
      Native Americans

    10.25
      Women, Infants, and Children (WIC)

    10.26
      Urgently Needed Services

    10.27
      Dental Services Provided by Article 28 Clinics Operated by Academic Dental
      Centers Not Participating in Contractor's Network- Applies to MMC Program
      Only

    10.28
      Hospice Services

    10.29
      Prospective Benefit Package Change for Retroactive SSI Determinations -Applies
      to MMC Program Only

    10.30
      Coordination of Services

     

    Section
      11 Marketing

    11.1
      Information Requirements

    11.2
      Marketing Plan

    11.3
      Marketing Activities

    11.4
      Prior Approval of Marketing Materials and Procedures

    11.5
      Corrective and Remedial Actions

     

    Section
      12 Member
      Services

    12.1
      General Functions

    12.2
      Translation and Oral Interpretation

    12.3
      Communicating with the Visually, Hearing and Cognitively Impaired

     

    TABLE
      OF
      CONTENTS

    January
      1, 2007

    3

     

    

    

    

    Table
      of Contents for Model Contract

    

     

    Section
      13  Enrollee
      Rights and Notification

    13.1
      Information Requirements

    13.2
      Provider Directories/Office Hours for Participating Providers

    13.3
      Member ID Cards

    13.4
      Member Handbooks

    13.5
      Notification of Effective Date of Enrollment

    13.6
      Notification of Enrollee Rights

    13.7
      Enrollee's Rights

    13.8
      Approval of Written Notices

    13.9
      Contractor's Duty to Report Lack of Contact

    13.10
      LDSS Notification of Enrollee's Change in Address

    13.11
      Contractor Responsibility to Notify Enrollee of Effective Date of Benefit
      Package Change

    13.12
      Contractor Responsibility to Notify Enrollee of Termination, Service Area
      Changes and Network Changes

     

    Section
      14 Action
      and Grievance System

    14.1
      General Requirements

    14.2
      Actions

    14.3
      Grievance System

    14.4
      Notification of Action and Grievance System Procedures

    14.5
      Complaint, Complaint Appeal and Action Appeal Investigation
      Determinations

     

    Section
      15 Access
      Requirements

    15.1
      General Requirement

    15.2
      Appointment Availability Standards

    15.3
      Twenty-Four (24) Hour Access

    15.4
      Appointment Waiting Times

    15.5
      Travel Time Standards

    15.6
      Service Continuation 

    a.
      New
      Enrollees 

    b.
      Enrollees Whose Health Care Provider Leaves Network

    15.7
      Standing Referrals

    15.8
      Specialist as a Coordinator of Primary Care

    15.9
      Specialty Care Centers 15.10 Cultural Competence

     

    Quality
      Management

    16.1
      Internal Quality Management Program

    16.2
      Standards of Care

     

    Monitoring
      and Evaluation

    17.1
      Right To Monitor Contractor Performance

    17.2
      Cooperation During Monitoring And Evaluation

    17.3
      Cooperation During On-Site Reviews

    17.4
      Cooperation During Review of Services by External Review Agency

     

    TABLE
      OF
      CONTENTS

    January
      1, 2007

    4

     

    

    Table
      of Contents for Model Contract

     

    Section
      18 Contractor
      Reporting Requirements

    18.1
      General Requirements

    18.2
      Time
      Frames for Report Submissions

    18.3
      SDOH
      Instructions for Report Submissions

    18.4
      Notification of Changes in Report Due Dates, Requirements or
      Formats

    18.5
      Reporting Requirements

    18.6
      Ownership and Related Information Disclosure

    18.7
      Public Access to Reports

    18.8
      Professional Discipline

    18.9
      Certification Regarding Individuals Who Have Been Debarred or Suspended by
      Federal or State Government

    18.10
      Conflict of Interest Disclosure

    18.11
      Physician Incentive Plan Reporting

     

    Section
      19 Records
      Maintenance and Audit Rights

    19.1
      Maintenance of Contractor Performance Records

    19.2
      Maintenance of Financial Records and Statistical Data

    19.3
      Access to Contractor Records

    19.4
      Retention Periods

     

    Section
      20 Confidentiality

    20.1
      Confidentiality of Identifying Information about Enrollees, Potential Enrollees.
      and Prospective Enrollees

    20.2
      Medical Records of Foster Children

    20.3
      Confidentiality of Medical Records

    20.4
      Length of Confidentiality Requirements

     

    Section
      21 Provider
      Network

    21.1
      Network Requirements

    21.2
      Absence of Appropriate Network Provider

    21.3
      Suspension of Enrollee Assignments to Providers

    21.4
      Credentialing

    21.5
      SDOH
      Exclusion or Termination of Providers

    21.6
      Application Procedure

    21.7
      Evaluation Information

    21.8
      Choice/Assignment of Primary Care Providers (PCPs)

    21.9
      Enrollee PCP Changes

    21.10
      Provider Status Changes

    21.11
      PCP
      Responsibilities

    21.12
      Member to Providers Ratios 

    21.13
      Minimum PC P Office Hours 

    a.
      General Requirements 

    b.
      Waiver
      of Minimum Hours

    21.14
      Primary Care Practitioners 

    a.
      General Limitations 

    b.
      Specialists and Sub-specialists as PCPs

     

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    c.
      OB/GYN
      Providers as PCPs 

    d.
      Certified Nurse Practitioners as PCPs

    21.15
      PCP
      Teams

    a.
      General Requirements

    b.
      Registered Physician Assistants as Physician Extenders

    c.
      Medical Residents and Fellows

    21.16
      Hospitals

    a.
      Tertiary Services 

    b.
      Emergency Services

    21.17
      Dental Networks

    21.18
      Presumptive Eligibility Providers

    21.19
      Mental Health and Chemical Dependence Services Providers

    21.20
      Laboratory Procedures

    21.21
      Federally Qualified Health Centers (FQHCs)

    21.22
      Provider Services Function

    21.23
      Pharmacies - Applies to FHPlus Program Only

     

    Section
      22 Subcontracts
      and Provider Agreements

    22.1
      Written Subcontracts

    22.2
      Permissible Subcontracts

    22.3
      Provision of Services Through Provider Agreements

    22.4
      Approvals 

    22.5
      Required Components

    22.6
      Timely Payment

    22.7
      Recovery of Overpayments to Providers

    22.8
      Restrictions on Disclosure

    22.9
      Transfer of Liability

    22.10
      Termination of Health Care Professional Agreements

    22.11
      Health Care Professional Hearings

    22.12
      Non-Renewal of Provider Agreements

    22.13
      Notice of Participating Provider Termination

    22.14
      Physician Incentive Plan

     

    Section
      23 Fraud
      and
      Abuse

    23.1
      General Requirements

    23.2
      Prevention Plans and Special Investigation Units

     

    Section
      24 Americans
      With Disabilities Act (ADA) Compliance Plan

     

    Section
      25 Fair
      Hearings

    25.1
      Enrollee Access to Fair Hearing Process

    25.2
      Enrollee Rights to a Fair Hearing

    25.3
      Contractor Notice to Enrollees

    25.4
      Aid
      Continuing

    25.5
      Responsibilities of SDOH

    25.6
      Contractor's Obligations

    
 

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    Section
      26 External
      Appeal

    26.1
      Basis for External Appeal

    26.2
      Eligibility For External Appeal

    26.3
      External Appeal Determination

    26.4
      Compliance With External Appeal Laws and Regulations

    26.5
      Member Handbook

     

    Section
      27  Intermediate
      Sanctions

    27.1
      General

    27.2
      Unacceptable Practices

    27.3
      Intermediate Sanctions

    27.4
      Enrollment Limitations

    27.5
      Due
      Process

     

    Section
      28 Environmental Compliance

    

    Section
      29 Energy Conservation

    

    Section
      30 Independent Capacity of Contractor Section 31 

    

    Section
      31 No
      Third
      Party Beneficiaries

     

    Section
      32  Indemnification

    32.1
      Indemnification by Contractor

    32.2
      Indemnification by DOHMH

     

    Section
      33  Prohibition
      on Use of Federal Funds for Lobbying

    33.1
      Prohibition of Use of Federal Funds for Lobbying

    33.2
      Disclosure Form to Report Lobbying

    33.3
      Requirements of Subcontractors

     

    Section
      34 Non-Discrimination

    34.1
      Equal Access to Benefit Package

    34.2
      Non-Discrimination

    34.3
      Equal Employment Opportunity

    34.4
      Native Americans Access to Services from Tribal or Urban Indian Health
      Facility

     

    Section
      35 Compliance
      with Applicable Laws

    35.1
      Contractor and DOHMH Compliance With Applicable Laws

    35.2
      Nullification of Illegal, Unenforceable, Ineffective or Void Contract
      Provisions

    35.3
      Certificate of Authority Requirements

    35.4
      Notification of Changes In Certificate of Incorporation

    35.5
      Contractor's Financial Solvency Requirements

    35.6
      Compliance With Care For Maternity Patients

    35.7
      Informed Consent Procedures for Hysterectomy and Sterilization

     

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    35.8
      Non-Liability of Enrollees For Contractor's Debts

    35.9
      DOHMH Compliance With Conflict of Interest Laws 

    35.10
      Compliance With New York State Public Health Law (PHL) Regarding External
      Appeals

    

    Section
      36 New York State Standard Contract Clauses and Local Standard Clauses

    Signature
      Page

    

    

     

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    APPENDICES

    

      A.
        New York State Standard Clauses

      B.
        Certification Regarding Lobbying

      C.
        New
        York State Department of Health Requirements for the Provision of Family
        Planning and Reproductive Health Services

      

      D.
        New
        York State Department of Health Marketing Guidelines 

      

      E.
        New
        York State Department of Health Member Handbook Guidelines

       

      F.
        New
        York State Department of Health Action and Grievance System Requirements
        for the
        MMC and FHPlus Programs

       

      G.
        New
        York State Department of Health Requirements for the Provision of Emergency
        Care
        and Services

       

      H.
        New York State Department of Health Requirements for the Processing
        of
        Enrollments and Disenrollments in the MMC and FHPlus Programs

       

      I.
        New
        York State Department of Health Guidelines for Use of Medical Residents and
        Fellows

      

      J.
        New
        York State Department of Health Guidelines for Contractor Compliance with
        the
        Federal ADA

      

      K.
        Prepaid Benefit Package Definitions of Covered and Non-Covered Services

      

      L.
        Approved Capitation Payment Rates

      

      M.
        Service Area, Benefit Options and Enrollment Elections 

      

      N.
        New
        York City Specific Contracting Requirements

      

      O.
        Requirements for Proof of Workers' Compensation and Disability Benefits
        Coverage

      

      P.
        RESERVED

      

      Q.
        RESERVED

      

      R.
        New
        York City Standard Local Clauses

    

     

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    APPENDIX
      F

    

    New
      York State Department of Health Action and Grievance System Requirements for
      MMC
      and FHPlus Programs

    

    

    F.1
      Action Requirements

    F.2
      Grievance System Requirements

    

    

    Appendix
      F

    January
      1, 2007

    F-1

    

    

    F.1

     

    Action
      Requirements

     

    1. Definitions

     

    a)
      Service Authorization Request means a request by an Enrollee, or a provider
      on
      the Enrollee's behalf, to the Contractor for the provision of a service,
      including a request for a referral or for a non-covered service.

     

    i)
      Prior
      Authorization Request is a Service Authorization Request by the Enrollee, or
      a
      provider on the Enrollee's behalf, for coverage of a new service, whether for
      a
      new authorization period or within an existing authorization period, before
      such
      service is provided to the Enrollee.

     

    ii)
      Concurrent Review Request is a Service Authorization Request by an Enrollee,
      or
      a provider on Enrollee's behalf, for continued, extended or more of an
      authorized service than what is currently authorized by the
      Contractor.

     

    b)
      Service Authorization Determination means the Contractor's approval or denial
      of
      a Service Authorization Request.

     

    c)
      Adverse Determination means a denial of a Service Authorization Request by
      the
      Contractor or an approval of a Service Authorization Request in an amount,
      duration, or scope that is less than requested.

     

    d)
      An
      Action means an activity of a Contractor or its subcontractor that results
      in:

     

    i)
      the
      denial or limited authorization of a Service Authorization Request, including
      the type or level of service;

     

    ii)
      the
      reduction, suspension, or termination of a previously authorized
      service;

     

    iii)
      the
      denial, in whole or in part, of payment for a service;

     

    iv)
      failure to provide services in a timely manner as defined by applicable
      State lawand
      regulation and Section 15 of this Agreement;

     

    v)
      failure of the Contractor to act within the timeframes for resolution and
      notification of determinations regarding Complaints. Action Appeals and
      Complaint Appeals provided in this Appendix; or

     

    vi)
      in
      rural areas, as defined by 42 CFR §412.62(f)(a), where enrollment in the MMC
      program is mandatory and there is only one MCO- the denial of an Enrollee's
      request
      to obtain services outside the MCO's network pursuant to 42 CFR
§438.52(b)(2)(ii).

     

    

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      F

    January
      1, 2007

    F-2

    

     

    2.
      General Requirements

     

    a)
      The
      Contractor's policies and procedures for Service Authorization Determinations
      and utilization review determinations shall comply with 42 CFR Part 438 and
      Article 49 of the PHL, including but not limited to the following:

     

    i)
      Expedited review of a Service Authorization Request must be conducted when
      the
      Contractor determines or the provider indicates that a delay would seriously
      jeopardize the Enrollee's life or health or ability to attain, maintain, or
      regain maximum function. The Enrollee may request expedited review of a Prior
      Authorization Request or Concurrent Review Request. If the Contractor denies
      the
      Enrollee's request for expedited review, the Contractor must handle the request
      under standard review timeframes. .

     

    ii)
      Any
      Action taken by the Contractor regarding medical necessity or experimental
      or
      investigational services must be made by a clinical peer reviewer as defined
      by
      PHL §4900(2)(a).

     

    iii)
      Adverse Determinations, other than those regarding medical necessity or
      experimental/investigational services, must be made by a licensed, certified
      or
      registered health care professional when such determination is based on an
      assessment of the Enrollee's health status or of the appropriateness of the
      level, quantity or delivery method of care. This requirement applies to Service
      Authorization Requests including but not limited to services included in the
      Benefit Package, referrals and out-of-network services.

     

    iv)
      The
      Contractor is required to provide notice by phone and in writing to the Enrollee
      and to the provider of Service Authorization Determinations, whether adverse
      or
      not, within the timeframe specified in Section 3 below. Notice to the provider
      must contain the same information as the Notice of Action for the
      Enrollee.

     

    v)
      The
      Contractor is required to provide the Enrollee written notice of any Action
      other than a Service Authorization Determinations within the timeframe specified
      in Section 4 below.

     

    3.
      Timeframes for Service Authorization Determinations

     

    a)
      For
      Prior Authorization Requests, the Contractor must make a Service Authorization
      Determination and notice the Enrollee of the determination by phone and in
      writing as fast as the Enrollee's condition requires and no more
      than:

    

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      F

    January
      1, 2007

    F-3

     

    i)
      In the
      case of an expedited review, three (3) business days after receipt of the.
      Service Authorization Request; or

     

    ii)
      In
      all other cases, within three (3) business days of receipt of necessary
      information, but no more than fourteen (14) days after receipt of the Service
      Authorization request.

     

    b)
      For
      Concurrent Review Requests, the Contractor must make a Service Authorization
      Determination and notice the Enrollee of the determination by phone and in
      writing as fast as the Enrollee's condition requires and no more
      than;

     

    i)
      In the
      case of an expedited review, one (1) business day after receipt of necessary
      information but no more than three (3) business days after receipt of the
      Service Authorization Request; or

     

    ii)
      In
      all other cases, within one (1) business day of receipt of necessary
      information, but no more than fourteen (14) days after receipt of the Service
      Authorization Request.

     

    c)
      Timeframes for Service Authorization Determinations may be extended for up
      to
      fourteen (14) days if:

     

    i)
      the
      Enrollee, the Enrollee's designee, or the Enrollee's provider requests an
      extension orally or in writing; or

     

    ii)
      The
      Contractor can demonstrate or substantiate that there is a need for additional
      information and how the extension is in the Enrollee's interest. The Contractor
      must send notice of the extension to the Enrollee. The Contractor must maintain
      sufficient documentation of extension determinations to demonstrate, upon SDOH's
      request, that the extension was justified.

     

    d)
      If the
      Contractor extended its review as provided in paragraph 3(c) above, the
      Contractor must make a Service Authorization Determination and notice the
      Enrollee by phone and in writing as fast as the Enrollee's condition requires
      and within three (3) business days after receipt of necessary information for
      Prior Authorization Requests or within one (1) business day after receipt of
      necessary information for Concurrent Review Requests, but in no event later
      than
      the date the extension expires.

     

    4.
      Timeframes for Notices of Actions Other Than Service Authorizations
      Determinations

     

    a)
      When
      the Contractor intends to reduce, suspend, or terminate a previously authorized
      service within an authorization period, it must provide the Enrollee with a
      written notice at least ten (10) days prior to the intended Action,
      except:

    

    Appendix
      F

    January
      1, 2007

    F-4

    

    

    i)
      the
      period of advance notice is shortened to five (5) days in cases of confirmed
      Enrollee fraud; or

     

    ii)
      the
      Contractor may mail notice not later than date of the Action for the
      following:

    

    A)
      the
      death of the Enrollee;

    B)
      a
      signed written statement from the Enrollee requesting service termination or
      giving information requiring termination or reduction of services (where the
      Enrollee understands that this must be the result of supplying the
      information);

    C)
      the
      Enrollee's admission to an institution where the Enrollee is ineligible for
      further services;

    D)
      the
      Enrollee's address is unknown and mail directed to the Enrollee is returned
      stating that there is no forwarding address;

    E)
      the
      Enrollee has been accepted for Medicaid services by another jurisdiction; or
       

    F)
      the
      Enrollee's physician prescribes a change in the level of medical
      care.

     

    b)
      The
      Contractor must mail written notice to the Enrollee on the date of the Action
      when the Action is denial of payment, in whole or in part, except as provided
      in
      paragraph F.I 6(b) below.

     

    c)
      When
      the Contractor does not reach a determination within the Service Authorization
      Determination timeframes described above, it is considered an Adverse
      Determination, and the Contractor must send notice of Action to the Enrollee
      on
      the date the timeframes expire.

     

    5.
      Format and Content of Notices

     

    a)
      The
      Contractor shall ensure that all notices are in writing, in easily understood
      language and are accessible to non-English speaking and visually impaired
      Enrollees. Notices shall include that oral interpretation and alternate formats
      of written material for Enrollees with special needs are available and how
      to
      access the alternate formats.

     

    i)
      Notice
      to the Enrollee that the Enrollee's request for an expedited review has been
      denied shall include that the request will be reviewed under standard
      timeframes, including a description of the timeframes.

     

    ii)
      Notice to the Enrollee regarding a Contractor-initiated extension shall
      include:

    A)
      the
      reason for the extension;

    B)
      an
      explanation of how the delay is in the best interest of the
      Enrollee;

    C)
      any
      additional information the Contractor requires from any source to make its
      determination;

    D)
      the
      right of the Enrollee to file a Complaint (as defined in Appendix F.2 of this
      Agreement)regarding the extension;

    

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      F

    January
      1, 2007

    F-5

    

    E)
      the
      process for filing a Complaint with the Contractor and the timeframes within
      which a Complaint determination must be made;

    F)
      the
      right of an Enrollee to designate a representative to file a Complaint on behalf
      of the Enrollee; and G) the right of the Enrollee to contact the New York State
      Department of Health regarding his or her Complaint, including the SDOH's
      toll-free number for Complaints. 

    

    iii)
      Notice to the Enrollee of an Action shall include:

    A)
      the
      description of the Action the Contractor has taken or intends to
      take;

    B)
      the
      reasons for the Action, including the clinical rationale, if any;

    C)
      the
      Enrollee's right to file an Action Appeal (as defined in Appendix F.2 of this
      Agreement), including:

    I)
      The
      fact that the Contractor will not retaliate or take any discriminatory action
      against the Enrollee because he/she filed an Action Appeal.

    II)
      The
      right of the Enrollee to designate a representative to file Action Appeals
      on
      his/her behalf;

    D)
      the
      process and timeframe for filing an Action Appeal with the Contractor, including
      an explanation that an expedited review of the Action Appeal can be requested
      if
      a delay would significantly increase the risk to an Enrollee's health, a
      toll-free number for filing an oral Action Appeal and a form, if
      used

    by
      the
      Contractor, for filing a written Action Appeal;

    E)
      a
      description of what additional information, if any. must be obtained by the
      Contractor from any source in order for the Contractor to make an Appeal
      determination;

    F)
      the
      timeframes within which the Action Appeal determination must be
      made;

    G)
      the
      right of the Enrollee to contact the New York State Department of Health with
      his or her Complaint, including the SDOH's toll-free number for Complaints;
      and

    H)
      the
      notice entitled "Managed Care Action Taken" for denial of benefits or for
      termination or reduction in benefits, as applicable, containing the Enrollee's
      fair hearing and aid continuing rights. 

    I)
      For
      Actions based on issues of Medical Necessity or an experimental or
      investigational treatment, the notice of Action shall also include;

    I)
      a
      clear statement that the notice constitutes the initial adverse determination
      and specific use of the terms "medical necessity" or
      "experimental/investigational”;

    II)
      a
      statement that the specific clinical review criteria relied upon in making
      the
      determination is available upon request; and

    III)
      a
      statement that the Enrollee may be eligible for an External Appeal.

     

    6.
      Contractor Obligation to Notice

     

    a)
      The
      Contractor must provide written Notice of Action to Enrollees and providers
      in
      accordance with the requirements of this Appendix, including, but not limited
      to, the following circumstances (except as provided for in paragraph 6(b)
      below):

    

    Appendix
      F

    January
      1, 2007

    F-6

     

    

    i)
      the
      Contractor makes a coverage determination or denies a request for a referral,
      regardless of whether the Enrollee has received the benefit;

     

    ii)
      the
      Contractor determines that a service does not have appropriate
      authorization;

     

    iii)
      the
      Contractor denies a claim for services provided by a Non-Participating Provider
      for any reason;

     

    iv)
      the
      Contractor denies a claim or service due to medical necessity;

     

    v)
      the
      Contractor rejects a claim or denies payment due to a late claim
      submission;

     

    vi)
      the
      Contractor denies a claim because it has determined that the Enrollee was not
      eligible for MMC or FHPlus coverage on the date of service;

     

    vii)
      the
      Contractor denies a claim for service rendered by a Participating Provider
      due
      to lack of a referral;

     

    viii)
      the
      Contractor denies a claim because it has determined it is not the appropriate
      payor; or

     

    ix)
      the
      Contractor denies a claim due to a Participating Provider billing for Benefit
      Package services not included in the Provider. Agreement between the Contractor
      and the Participating Provider.

     

    b)
      The
      Contractor is not required to provide written Notice of Action to Enrollees
      in
      the following circumstances:

     

    i)
      When
      there is a prepaid capitation arrangement with a Participating Provider and
      the
      Participating Provider submits a fee-for-service claim to the Contractor for
      a
      service that falls within the capitation payment;

     

    ii)
      if a
      Participating Provider of the Contractor itemizes or "unbundles" a claim for
      services encompassed by a previously negotiated global fee
      arrangement;

     

    iii)
      if a
      duplicate claim is submitted by the Enrollee or a Participating Provider, no
      notice is required, provided an initial notice has been issued;

     

    iv)
      if
      the claim is for a service that is carved-out of the MMC Benefit Package and
      is
      provided to a MMC Enrollee through Medicaid fee-for-service, however, the
      Contractor should notify the provider to submit the claim to
      Medicaid;

     

    v)
      if the
      Contractor makes a coding adjustment to a claim (up-coding or down-coding)
      and
      its Provider Agreement with the Participating Provider includes a provision
      allowing the Contractor to make such adjustments;

    

    Appendix
      F

    January
      1, 2007

    F-7

    

    vi)
      if
      the Contractor has paid the negotiated amount reflected in the Provider
      Agreement with a Participating Provider for the services provided to the
      Enrollee and denies the Participating Provider's request for additional payment;
      or

     

    vii)
      if
      the Contractor has not yet adjudicated the claim. If the Contractor has pended
      the claim while requesting additional information, a notice is not required
      until the coverage determination has been made.

     

    

    Appendix
      F

    January
      1, 2007

    F-8

     

    

    F.2

    Grievance
      System Requirements

     

    1.
      Definitions

     

    a)
      A
      Grievance System means the Contractor's Complaint and Appeal process, and
      includes a Complaint and Complaint Appeal process, a process to appeal Actions,
      and access to the State's fair hearing system.

     

    b)
      For
      the purposes of this Agreement, a Complaint means an Enrollee's expression
      of
      dissatisfaction with any aspect of his or her care other than an Action. A
      "Complaint" means the same as a "grievance" as defined by 42 CFR §438.400
      (b).

     

    c)
      An
      Action Appeal means a request for a review of an Action.

     

    d)
      A
      Complaint Appeal means a request for a review of a Complaint
      determination.

     

    e)
      An
      Inquiry means a written or verbal question or request for information posed
      to
      the Contractor with regard to such issues as benefits, contracts, and
      organization rules. Neither Enrollee Complaints nor disagreements with
      Contractor determinations are Inquiries.

     

    2.
      Grievance System - General Requirements

     

    a)
      The
      Contractor shall describe its Grievance System in the Member Handbook, and
      it
      must be accessible to non-English speaking, visually, and hearing impaired
      Enrollees. The handbook shall comply with Section 13.4 and The Member Handbook
      Guidelines (Appendix E) of this Agreement.

     

    b)
      The
      Contractor will provide Enrollees with any reasonable assistance in completing
      forms and other procedural steps for filing a Complaint, Complaint Appeal or
      Action Appeal, including, but not limited to. providing interpreter services
      and
      toll-free numbers with TTY/TDD and interpreter capability.

     

    c)
      The
      Enrollee may designate a representative to file Complaints, Complaint Appeals
      and Action Appeals on his/her behalf.

     

    d)
      The
      Contractor will not retaliate or take any discriminatory action against the
      Enrollee because he/she filed a Complaint. Complaint Appeal or Action
      Appeal.

    

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      F

    January
      1, 2007

    F-9

    

    

    e)
      The
      Contractor's procedures for accepting Complaints, Complaint Appeals and Action
      Appeals shall include:

     

    i)
      toll-free telephone number;

     

    ii)
      designated staff to receive calls;

     

    iii)
      ''live" phone coverage at least forty (40) hours a week during normal business
      hours;

     

    iv)
      a
      mechanism to receive after hours calls, including either:

    A)
      a
      telephone system available to take calls and a plan to respond to all such
      calls
      no later than on the next business day after the calls were recorded;
      or

    B)
      a
      mechanism to have available on a twenty-four (24) hour, seven (7) day a week
      basis designated staff to accept telephone Complaints; whenever a delay would
      significantly increase the risk to an Enrollee's health.

     

    f)
      The
      Contractor must ensure that personnel making determinations regarding
      Complaints, Complaint Appeals and Action Appeals were not involved in previous
      levels of review or decision-making. If any of the following applies,
      determinations must be made by qualified clinical personnel as specified in
      this
      Appendix:

     

    i)
      A
      denial Action Appeal based on lack of medical necessity.

     

    ii)
      A
      Complaint regarding denial of expedited resolution of an Action
      Appeal.

     

    iii)
      A
      Complaint, Complaint Appeal, or Action Appeal that involves clinical
      issues.

     

    3.
      Action Appeals Process

     

    a)
      The
      Contractor's Action Appeals process shall indicate the following regarding
      resolution of Appeals of an Action:

     

    i)
      The
      Enrollee, or his or her designee, will have no less than sixty (60) business
      days from the date of the notice of Action to file an Action Appeal. An Enrollee
      filing an Action Appeal within 10 days of the notice of Action or by the
      intended date of an Action, whichever is later, that involves the reduction,
      suspension, or termination of'previously approved services may request "aid
      continuing" in accordance with Section 25.4 of this Agreement.

     

    ii)
      The
      Enrollee may file a written Action Appeal or an oral Action Appeal. Oral Action
      Appeals must be followed by a written, signed, Action Appeal. The Contractor
      may
      provide a written summary of an oral Action Appeal to the Enrollee (with the
      acknowledgement or separately) for the Enrollee to review,

    Appendix
      F

    January
      1, 2007

    F-10

     

    modify
      if
      needed, sign and return to the Contractor. If the Enrolled or provider requests
      expedited resolution, of the Action Appeal, the oral Action Appeal does not
      need
      to be confirmed in writing. The date of the oral filing of the Action Appeal
      will be the date of the Action Appeal for the purposes of the timeframes for
      resolution of Action Appeals. Action Appeals resulting from a Concurrent Review
      must be handled as an expedited Action Appeal.

     

    iii)
      The
      Contractor must send a written acknowledgement of the Action Appeal within
      fifteen (15) days of receipt. If a determination is reached before the written
      acknowledgement is sent. the Contractor may include the written acknowledgement
      with the notice of Action Appeal determination (one notice).

     

    iv)
      The
      Contractor must provide the Enrollee reasonable opportunity to present evidence,
      and allegations of fact or law, in person as well as in writing. The Contractor
      must inform the Enrollee of the limited time to present such evidence in the
      case of an expedited Action Appeal. The Contractor must allow the Enrollee
      or
      his or her designee, both before and during the Action Appeals process, to
      examine the Enrollee's case file, including medical records and any other
      documents and records considered during the Action Appeals process. The
      Contractor will consider the Enrollee, his or her designee, or legal estate
      representative of a deceased Enrollee a party to the Action Appeal.

     

    v)
      The
      Contractor must have a process for handling expedited Action Appeals. Expedited
      resolution of the Action Appeal must be conducted when the Contractor determines
      or the provider indicates that a delay would seriously jeopardize the Enrollee's
      life or health or ability to attain, maintain, or regain maximum function.
      The
      Enrollee may request an expedited review of. an Action Appeal. If the Contractor
      denies the Enrollee's request for an expedited review, the Contractor must
      handle the request under standard Action Appeal resolution timeframes, make
      reasonable efforts to provide prompt oral notice of the denial to the Enrollee
      and send written notice of the denial within two (2) days of the denial
      determination.

     

    vi)
      The
      Contractor must ensure that punitive action is not taken against a provider
      who
      either requests an expedited resolution or supports an Enrollee's
      Appeal.

     

    vii)
      Action Appeals of clinical matters must be decided by personnel qualified to
      review the Action Appeal, including licensed, certified or registered health
      care professionals who did not make the initial determination, at least one
      of
      whom must be a clinical peer reviewer, as defined by PHL §4900(2)(a). Action
      Appeals of non-clinical matters shall be determined by qualified personnel
      at a
      higher level than the personnel who made the original
      determination.

    

    

    Appendix
      F

    January
      1, 2007

    F-11

     

    4.
      Timeframes for Resolution of Action Appeals

     

    a)
      The
      Contractor's Action Appeals process shall indicate the following specific
      timeframes regarding Action Appeal resolution:

     

    i)
      The
      Contractor will resolve Action Appeals as fast as the Enrollee's condition
      requires, and no later than thirty (30) days from the date of the receipt of
      the
      Action Appeal.

     

    ii)
      The
      Contractor will resolve expedited Action Appeals as fast as the Enrollee's
      condition requires, within two (2) business days of receipt of necessary
      information and no later than three (3) business days of the date of the receipt
      of the Action Appeal.

     

    iii)
      Timeframes for Action Appeal resolution may be extended for up to fourteen
      (14)
      days if:

    A)
      the
      Enrollee, his or her designee. or the provider requests an extension orally
      or
      in writing; or

    B)
      the
      Contractor can demonstrate or substantiate that there is a need for additional
      information and the extension is in the Enrollee's interest. The Contractor
      must
      send notice of the extension to the Enrollee. The Contractor must maintain
      sufficient documentation of extension determinations to demonstrate, upon SDOH's
      request, that the extension was justified.

     

    iv)
      The
      Contractor will make a reasonable effort to provide oral notice to the Enrollee,
      his or her designee, and the provider where appropriate, for expedited Action
      Appeals at the time the Action Appeal determination is made.

     

    v)
      The
      Contractor must send written notice to the Enrollee, his or her designee, and
      the provider where appropriate, within two (2) business days of the Action
      Appeal determination.

     

    5.
      Action Appeal Notices

     

    a)
      The
      Contractor shall ensure that all notices are in writing and in easily understood
      language and are accessible to non-English speaking and visually impaired
      Enrollees. Notices shall include that oral interpretation and alternate formats
      of written material for Enrollees with special needs are available and how
      to
      access the alternate formats.

     

    i)
      Notice
      to the Enrollee that the Enrollee's request for an expedited Action Appeal
      has
      been denied shall include that the request will be reviewed under standard
      Action Appeal timeframes, including a description of the timeframes. This notice
      may be combined with the acknowledgement.

    
 

    Appendix
      F

    January
      1, 2007

    F-12

    

    ii)
      Notice to the Enrollee regarding an Contractor-initiated extension shall
      include:

    A)
      the
      reason for the extension;

    B)
      an
      explanation of how the delay is in the best interest of the
      Enrollee;

    C)
      any
      additional information the Contractor requires from any source to make its
      determination;

    D)
      the
      right of the Enrollee to file a Complaint regarding the extension;

    E)
      the
      process for filing a Complaint with the Contractor and the timeframes within
      which a Complaint determination must be made;

    F)
      the
      right of an Enrollee to designate a representative to file a Complaint on behalf
      of the Enrollee; and 

    G)
      the
      right of the Enrollee to contact the New York State Department of Health
      regarding his or her their Complaint, including the SDOH's toll-free number
      for
      Complaints.

     

    iii)
      Notice to the Enrollee of Action Appeal Determination shall
      include:

    A)
      Date
      the Action Appeal was filed and a summary of the Action Appeal;

    B)
      Date
      the Action Appeal process was completed;

    C)
      the
      results and the reasons for the determination, including the clinical rationale,
      if any;

    D)
      If the
      determination was not in favor of the Enrollee, a description of

    Enrollee's
      fair hearing rights, if applicable;

    E)
      the
      right of the Enrollee to contact the New York State Department of
      Health

    regarding
      his or her Complaint, including the SDOH's toll-free number for

    Complaints;
      and 

    F)
      For
      Action Appeals involving Medical Necessity or an experimental or

    investigational
      treatment, the notice must also include:

    I)
      a
      clear statement that the notice constitutes the final adverse determination
      and
      specifically use the terms "medical necessity" or
      "experimental/investigational;"

    II)
      the
      Enrollee's coverage type;

    III)
      the
      procedure in question, and if available and applicable the name of the provider
      and developer/manufacturer of the health care service;

    IV)
      statement that the Enrollee is eligible to file an External Appeal and the
      timeframe for filing;

    V)
      a copy
      of the "Standard Description and Instructions for Health Care Consumers to
      Request an External Appeal" and the External Appeal application
      form;

    VI)
      the
      Contractor's contact person and telephone number;

    VII)
      the
      contact person, telephone number, company name and full address of the
      utilization review agent, if the determination was made by the
      agent;

    and

    VIII)
      if
      the Contractor has a second level internal review process, the notice shall
      contain instructions on how to file a second level Action Appeal and a statement
      in bold text that the timeframe for requesting an External Appeal begins upon
      receipt of the final adverse determination

    
 

    Appendix
      F

    January
      1, 2007

    F-13

    

    

    of
      the
      first level Action Appeal, regardless of whether or not a second level of Action
      Appeal is requested, and that by choosing to request a second level Action
      Appeal, the time may expire for the Enrollee to request an External
      Appeal.

     

    6.
      Complaint Process

     

    a)
      The
      Contractor' Complaint process shall include the following regarding the handling
      of Enrollee Complaints:

     

    i)
      The
      Enrollee, or his or her designee, may file a Complaint regarding any dispute
      with the Contractor orally or in writing. The Contractor may have requirements
      for accepting written Complaints either by letter or Contractor supplied form.
      The Contractor cannot require an Enrollee to file a Complaint in
      writing.

     

    ii)
      The
      Contractor must provide written acknowledgement of any Complaint not immediately
      resolved, including the name, address and telephone number of the individual
      or
      .department handling the Complaint, within fifteen (15) business days of receipt
      of the Complaint. The acknowledgement must identify any additional information
      required by the Contractor from any source to make a determination. If a
      Complaint determination is made before the written acknowledgement is sent,
      the
      Contractor may include the acknowledgement with the notice of the determination
      (one notice).

     

    iii)
      Complaints shall be reviewed by one or more qualified personnel.

     

    iv)
      Complaints pertaining to clinical matters shall be reviewed by one or more
      licensed, certified or registered health care professionals in addition to
      whichever non-clinical personnel the Contractor designates.

     

    7.
      Timeframes for Complaint Resolution by the Contractor

     

    a)
      The
      Contractor's Complaint process shall indicate the following specific timeframes
      regarding Complaint resolution;

     

    i)
      If the
      Contractor immediately resolves an oral Complaint to the Enrollee's
      satisfaction, that Complaint may be considered resolved without any additional
      written notification to the Enrollee. Such Complaints must be logged by the
      Contractor and included in the Contractor's quarterly HPN Complaint report
      submitted to SDOH in accordance with Section 18 of this Agreement.

     

    ii)
      Whenever a delay would significantly increase the risk to an Enrollee's health,
      Complaints shall be resolved within forty-eight (48) hours after receipt of
      all
      necessary information and no more than seven (7) days from the receipt of the
      Complaint.

    Appendix
      F

    January
      1, 2007

    F-14

    

    

    iii)
      All
      other Complaints shall be resolved within forty-five (45) days after the receipt
      of all necessary information and no more than sixty (60) days from receipt
      of
      the Complaint. The Contractor shall maintain reports of Complaints unresolved
      after forty-five (45) days in accordance with Section 18 of this
      Agreement.

     

    8.
      Complaint Determination Notices

     

    a)
      The
      Contractor's procedures regarding the resolution of Enrollee Complaints shall
      include the following:

     

    i)
      Complaint Determinations by the Contractor shall be made in writing to the
      Enrollee or his/her designee and include:

    A)
      the
      detailed reasons for the determination;

    B)
      in
      cases where the determination has a clinical basis, the clinical rationale
      for
      the determination;

    C)
      the
      procedures for the filing of an appeal of the determination, including a form,
      if used by the Contractor, for the filing of such a Complaint Appeal; and notice
      of the right of the Enrollee to contact the State Department of Health regarding
      his or her Complaint, including SDOH's toll-free number for
      Complaints.

     

    ii) If
      the Contractor was unable to make a Complaint determination because insufficient
      information was presented or available to reach a determination, the Contractor
      will send a written statement that a determination could not be made to the
      Enrollee on the date the allowable time to resolve the Complaint has
      expired.

     

    iii)
      In
      cases where delay would significantly increase the risk to an Enrollee's health,
      the Contractor shall provide notice of a determination by telephone directly
      to
      the Enrollee or to the Enrollee's designee, or when no phone is available,
      some
      other method of communication, with written notice to follow within three (3)
      business days.

     

    9.
      Complaint Appeals

     

    a)
      The
      Contractor's procedures regarding Enrollee Complaint Appeals shall include
      the
      following:

     

    i)
      The
      Enrollee or designee has no less than sixty (60) business days after receipt
      of
      the notice of the Complaint determination to file a written Complaint Appeal.
      Complaint Appeals may be submitted by letter or by a form provided by the
      Contractor.

     

    ii)
      Within fifteen (15) business days of receipt of the Complaint Appeal, the
      Contractor shall provide written acknowledgement of the Complaint Appeal,
      including the name. address and telephone number of the individual designated
      to

    Appendix
      F

    January
      1, 2007

    F-15

    

    respond
      to the Appeal. The Contractor shall indicate what additional information, if
      any, must be provided for the Contractor to render a determination.

     

    iii)
      Complaint Appeals of clinical matters must be decided by personnel qualified
      to
      review the Appeal, including licensed, certified or registered health care
      professionals who did not make the initial determination, at least one of whom
      must be a clinical peer reviewer, as defined by PHL §4900(2)(a).

    

    iv)
      Complaint Appeals of non-clinical matters shall be determined by qualified
      personnel at a higher level than the personnel who made the original Complaint
      determination.

     

    v)
      Complaint Appeals shall be decided and notification provided to the Enrollee
      no
      more than:

    A)
      two
      (2) business days after the receipt of all necessary information when a delay
      would significantly increase the risk to an Enrollee's health; or

    B)
      thirty
      (3.0) business days after the receipt of all necessary information in all other
      instances.

     

    vi)
      The
      notice of the Contractor's Complaint Appeal determination shall
      include:

    A)
      the
      detailed reasons for the determination;

    B)
      the
      clinical rationale for the determination in cases where the determination has
      a
      clinical basis;

    C)
      the
      notice shall also inform the Enrollee of his/her option to also contact the
      State Department of Health with his/her Complaint, including the SDOH's
      toll-free number for Complaints;

    D)
      instructions for any further Appeal, if applicable.

     

    10. Records

     

    a)
      The
      Contractor shall maintain a file on each Complaint, Action Appeal and Complaint
      Appeal. These records shall be readily available for review by the SDOH, upon
      request. The file shall include:

     

    i)
      date
      the Complaint was filed;

     

    ii)
      copy
      of the Complaint, if written;

     

    iii)
      date
      of receipt of and copy of the Enrollee's written confirmation, if
      any;

     

    iv)
      log
      of Complaint determination including the date of the determination and the
      titles of the personnel and credentials of clinical personnel who reviewed
      the
      Complaint;

     

    v)
      date
      and copy of the Enrollee's Action Appeal or Complaint Appeal;

    
 

    Appendix
      F

    January
      1, 2007

    F-16

     

    

    

    vi)
      Enrollee or provider requests for expedited Action Appeals and Complaint Appeals
      and the Contractor's determination;

     

    vii)
      necessary documentation to support any extensions;

     

    viii)
      determination and date of determination of the Action Appeals and Complaint
      Appeals;

     

    ix)
      the
      titles and credentials of clinical staff who reviewed the Action Appeals and
      Complaint Appeals; and

     

    x)
      Complaints unresolved for greater than forty-five (45) days.

    

    

    Appendix
      F

    January
      1, 2007

    F-17

    

    

    APPENDIX
      G

     

    SDOH
      Requirements for the Provision 

    of
      Emergency Care and Services

    

     

    

     

    

    Appendix
      G

    January
      1, 2007

    G-1

     

    

    

    SDOH
      Requirements for the 

    Provision
      of Emergency Care and Services

     

    1. Definitions

     

    a)
      "Emergency Medical Condition" means a medical or behavioral condition, the
      onset
      of which is sudden, that manifests itself by symptoms of sufficient severity,
      including severe pain, that a prudent layperson, possessing an average knowledge
      of medicine and health, could reasonably expect the absence of immediate medical
      attention to result in:

     

    i)
      placing the health of the person afflicted with such condition in serious
      jeopardy or, in the case of a pregnant woman, the health of the woman or her
      unborn child or, in the case of a behavioral condition, placing the health
      of
      the person or others in serious jeopardy; or

     

    ii)
      serious impairment to such person's bodily functions; or

     

    iii)
      serious dysfunction of any bodily organ or part of such person; or

     

    iv)
      serious disfigurement of such person.

     

    b)
      "Emergency Services"
      means
      covered inpatient and outpatient health care procedures, treatments or services
      that are furnished by a provider qualified to furnish these services and that
      are needed to evaluate or stabilize an Emergency Medical Condition including
      psychiatric stabilization and medical detoxification from drugs or
      alcohol.

     

    c)
      "Post-stabilization Care Services"
      means
      covered services, related to an emergency medical condition, that are provided
      after an Enrollee is stabilized in order to maintain the stabilized condition,
      or, under the circumstances described in Section 3 below, to improve or resolve
      the Enrollee's condition.

     

    2.
      Coverage and Payment of Emergency Services 

     

    a)
      The
      Contractor must cover and pay for Emergency Services regardless of whether
      the
      provider that furnishes the services has a contract with the
      Contractor.

     

    b)
      The
      Contractor shall cover and pay for services as follows:

     

    i)
      Participating Providers

     

    A)
      Payment by the Contractor for general hospital emergency department services
      provided to an Enrollee by a Participating Provider shall be at the rate or
      rates of payment specified in the contract between the Contractor
      and

    

    Appendix
      G

    January
      1, 2007

    G-2

    
 

    the
      hospital. Such contracted rate or rates shall be paid without regard to whether
      such services meet the definition of Emergency Medical Condition.

     

    B)
      Payment by the Contractor for physician services provided to an Enrollee by
      a
      Participating Provider while the Enrollee is receiving general hospital
      emergency department services shall be at the rate or rates of payment specified
      in the contract between the Contractor and the physician. Such contracted rate
      or rates shall be paid without regard to whether such services meet the
      definition of Emergency Medical Condition.

     

    ii)
      Non-Participating Providers

     

    A)
      Payment by the Contractor for general hospital emergency department services
      provided to an Enrollee by a Non-Participating Provider shall be at the Medicaid
      fee-for-service rate, inclusive of the capital component, in effect on the
      date
      that the service was rendered without regard to whether such services meet
      the
      definition of Emergency Medical Condition.

     

    B)
      Payment by the Contractor for physician services provided to an Enrollee by
      a
      Non-Participating Provider while the Enrollee is receiving general hospital
      emergency department services shall be at the Medicaid fee-for-service rate
      in
      effect on the date the service was rendered without regard to whether such
      services meet the definition of Emergency Medical Condition.

     

    c)
      The
      Contractor must advise Enrollees that they may access Emergency Services at
      any
      Emergency Services provider.

     

    d)
      Prior
      authorization for treatment of an Emergency Medical Condition is never
      required.

     

    e)
      The
      Contractor may not deny payment for treatment obtained in either of the
      following circumstances:

     

    i)
      An
      Enrollee had an Emergency Medical Condition, including cases in which the
      absence of immediate medical attention would not have had the outcomes specified
      in the definition of Emergency Medical Condition above.

     

    ii)
      A
      representative of the Contractor instructs the Enrollee to seek Emergency
      Services.

     

    f)
      A
      Contractor may not:

     

    i)
      limit
      what constitutes an Emergency Medical Condition based on lists of diagnoses
      or
      symptoms; or

    ii)
      refuse to cover emergency room services based on the failure of the provider
      or
      the Enrollee to give the Contractor notice of the emergency room
      visit.

    

    Appendix
      G

    January
      1, 2007

    G-3

     

    g)
      An
      Enrollee who has an Emergency Medical Condition may not be held liable for
      payment of subsequent screening and treatment needed to diagnose the specific
      condition or stabilize the patient.

     

    h)
      The
      attending emergency physician, or the provider actually treating the Enrollee,
      is responsible for determining when the Enrollee is sufficiently stabilized
      for
      transfer or discharge, and that determination is binding on the Contractor
      for
      payment.

     

    3.
      Coverage and Payment of Post-stabilization Care Services

     

    a)
      The
      Contractor is financially responsible for Post-stabilization Care Services
      furnished by a provider within or outside the Contractor's network
      when:

     

    i)
      they
      are pre-approved by a Participating . Provider, as authorized by the Contractor,
      or other authorized Contractor representative;

     

    ii)
      they
      are not pre-approved by a Participating Provider, as authorized by the
      Contractor, or other authorized Contractor representative, but administered
      to
      maintain the Enrollee's stabilized condition within one (1) hour of a request
      to
      the Contractor for pre-approval of further Post-stabilization Care
      Services;

     

    iii)
      they
      are not pre-approved by a Participating Provider, as authorized by the
      Contractor, or other authorized Contractor representative, but administered
      to
      maintain, improve or resolve the Enrollee's stabilized condition
      if;

    A)
      The
      Contractor does not respond to a request for pre-approval within one
      (l)hour;

    B)
      The
      Contractor cannot be contacted; or

    C)
      The
      Contractor's representative and the treating physician cannot reach an agreement
      concerning the Enrollee's care and a plan physician is not available for
      consultation. In this situation, the Contractor must give the treating physician
      the opportunity to consult with a plan physician and the treating physician
      may
      continue with care of the patient until a plan physician is reached or one
      of
      the criteria in 3(b) is met. 

     

    iv)
      The
      Contractor must limit charges to Enrollees for Post-stabilization Care Services
      to an amount no greater than what the organization would charge the Enrollee
      if
      he or she had obtained the services through the Contractor.

     

    b)
      The
      Contractor's financial responsibility to the treating emergency provider for
      Post-stabilization Care Services it has not pre-approved ends when:

     

    i)
      A plan
      physician with privileges at the treating hospital assumes responsibility for
      the Enrollee's care;

    

    Appendix
      G

    January
      1, 2007

    G-4

    

    

    ii)
      A
      plan physician assumes responsibility for the Enrollee's care through
      transfer;

     

    iii)
      A
      Contractor representative and the treating physician reach an agreement
      concerning the Enrollee's care or

     

    iv)
      The
      Enrollee is discharged.

     

    4.
      Protocol for Acceptable Transfer Between Facilities

     

    a)
      All
      relevant COBRA requirements must be met.

     

    b)
      The
      Contractor must provide for an appropriate (as determined by the emergency
      department physician) transfer method/level with personnel as
      needed.

     

    c)
      The
      Contractor must contact/arrange for an available, accepting physician and
      patient bed at the receiving institution.

     

    d)
      If a
      patient is not transferred within eight (8) hours to an appropriate inpatient
      setting after the decision to admit has been made, then admission at the
      original facility is deemed authorized.

     

    5.
      Emergency Transportation

     

    When
      emergency transportation is included in the Contractor's Benefit Package, the
      Contractor shall reimburse the transportation provider for all emergency
      ambulance services without regard to final diagnosis or prudent layperson
      standards.

    

    

    Appendix
      G

    January
      1, 2007

    G-5

    

    

    APPENDIX
      K

    PREPAID
      BENEFIT PACKAGE DEFINITIONS OF COVERED AND NON-COVERED
      SERVICES

    

    

    

    K.1
      Chart
      of Prepaid Benefit Package

    -
      Medicaid Managed Care Non-SSI (MMC Non-SSI)

    -
      Medicaid Managed Care SSI (MMC SSI)

    -
      Medicaid Fee-for-Service (MFFS)

    -
      Family
      Health Plus (FHPlus)

     

    K.2
      Prepaid Benefit Package Definitions of Covered Services

     

    K.3
      Medicaid Managed Care Definitions of Non-Covered Services

     

    K.4
      Family Health Plus Non-Covered Services

    
 

    Appendix
      K

    January
      1, 2007

    K-1

     

    

    

    APPENDIX
      K 

    PREPAID
      BENEFIT PACKAGE 

    DEFINITIONS
      OF COVERED AND NON-COVERED SERVICES

     

    1. General

     

    a)
      The
      categories of services in the Medicaid Managed Care and Family Health Plus
      Benefit Packages, including optional-covered services shall be provided by
      the
      Contractor to MMC Enrollees and FHPlus Enrollees. respectively, when medically
      necessary under the terms of this Agreement. The definitions of covered and
      non-covered services herein are in summary form; the full description and scope
      of each covered service as established by the New York Medical Assistance
      Program are set forth in the applicable NYS Medicaid Provider Manual, except
      for
      the Eye Care and Vision benefit for FHPlus Enrollees which is described in
      Section 19 of Appendix K.2.

     

    b)
      All
      care provided by the Contractor, pursuant to this Agreement, must be provided,
      arranged, or authorized by the Contractor or its Participating Providers with
      the exception of most behavioral health services to SSI or SSI related
      beneficiaries, and emergency services, emergency transportation, Family Planning
      and Reproductive Health services, mental health and chemical dependence
      assessments (one (1) of each per year), court ordered services, and services
      provided by Local Public Health Agencies as described in Section 10 of this
      Agreement.

     

    c)
      This
      Appendix contains the following sections:

     

    i)
      K.I -
      "Chart of Prepaid Benefit Package'' lists the services provided by the
Contractor
      to all Medicaid Managed Care Non-SSI Enrollees. Medicaid Managed Care SSI
      Enrollees, Medicaid fee-for-service coverage for carved out and wraparound
      benefits, and Family Health Plus Enrollees.

     

    ii)
      K.2 -
      ''Prepaid Benefit Package Definitions Of Covered Services" describes the covered
      services, as numbered in K. 1. Each service description applies to both MMC
      and
      FHPlus Benefit Package unless otherwise noted.

     

    iii)
      K.3
      - "Medicaid Managed Care Definitions of Non-Covered Services'' describes
      services that are not covered by the MMC Benefit Package. These services are
      covered by the Medicaid fee-for-service program unless otherwise
      noted.

     

    iv)
      K.4 -
      "Family Health Plus Non-Covered Services" lists the services that are not
      covered by the FHPlus Benefit Package. There is no Medicaid fee-for-service
      coverage available for any service outside of the FHPlus Benefit
      Package.

     

    

    

    K.I

     

    PREPAID
      BENEFIT PACKAGE

     

    

      
        	
                *

              	
                Covered
                  Services

              	
                MMC
                  Non-SSI

              	
                MMC
                  SSI

              	
                MFFS

              	 	
                FHPlus
                  **

              
	
                1.

              	
                Inpatient
                  Hospital Services

              	
                Covered,
                  unless admit date precedes Effective Date of

                Enrollment
                  (see § 6.8 of this Agreement)

              	
                Covered,
                  unless admit date precedes Effective Date of Enrollment (see § 6.8 of this
                  Agreement)

              	
                Stay
                  covered only when admit date precedes Effective Date of Enrollment
                  (see
                  §6.8 of this Agreement)

              	 	
                Covered,
                  unless admit date precedes Effective Date of Enrollment (see § 6.8 of this
                  Agreement)

              
	
                2

              	
                Inpatient
                  Stay Pending Alternate Level of Medical Care

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                3.

              	
                Physician
                  Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                4.

              	
                Nurse
                  Practitioner Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                5.

              	
                Midwifery
                  Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                6.

              	
                Preventive
                  Health Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                7.

              	
                Second
                  Medical/Surgical Opinion

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                8.

              	
                Laboratory
                  Services

              	
                Covered

              	
                Covered

              	
                HIV
                  phenotypic, virtual phenotypic and genotypic drug resistance
                  tests

              	 	
                Covered

              
	
                9.

              	
                Radiology
                  Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                10.

              	
                Prescription
                  and Non-Prescription (OTC) Drugs, Medical Supplies, and Enteral
                  Formula

              	
                Pharmaceuticals
                  and medical supplies routinely furnished or administered as part
                  of a
                  clinic or office visit, except Risperdal Consta [see Appendix K.3,
                  2. b
                  xi) of this Agreement]

              	
                Pharmaceuticals
                  and medical supplies routinely furnished or administered as part
                  of a
                  clinic or office visit, except Risperdal Consta [see Appendix K.3,
                  2.
                  b)xi) of this Agreement]

              	
                Covered
                  outpatient drugs from the list of Medicaid reimbursable prescription
                  drugs, subject to any applicable co-payments

              	 	
                Covered,
                  may be limited to generic. .Vitamins (except to treat an illness
                  or
                  condition), OTCs. and medical supplies are not covered

              
	
                11.

              	
                Smoking
                  Cessation Products

              	 	 	
                Covered

              	 	
                Covered

              
	
                12.

              	
                Rehabilitation
                  Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered
                  for short term inpatient, and limited to 20 visits per calendar
                  year for
                  outpatient PT and OT

              
	
                13.

              	
                EPSDT
                  Services/Child Teen Health Program (C/THP)

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              

      

    

    

    

    APPENDIX
      K

    January
      1, 2007 

    K-3

     

    
      	
              *
                See K 2 for Scope of Benefits 

            	 
	
              Note:
                If cell is blank there is no coverage

            	
              **
                No Medicaid fee for service-wrap around is available

              Subject
                to applicable co-pays

            

    

     

    

      
        	
                *

              	
                Covered
                  Services

              	
                MMC
                  Non-SSI

              	
                MMCSSI

              	
                MFFS

              	
                 

              	
                FHPlus
                  **

              
	
                14.

              	
                Home
                  Health Services

              	
                Covered

              	
                Covered

              	
                 

              	
                 

              	
                Covered
                  for 40 visits in lieu of a skilled nursing facility stay or
                  hospitalization, plus 2 post pal-turn home visits for high risk
                  women

              
	
                15

              	
                Private
                  Duty Nursing Services

              	
                Covered

              	
                Covered

              	
                 

              	
                 

              	
                Not
                  covered

              
	
                16

              	
                Hospice

              	
                 

              	
                 

              	
                Covered

              	
                 

              	
                Covered

              
	
                17.

              	
                Emergency
                  Services

                 

                Post-Stabilization
                  Care Services (see also Appendix G of this Agreement)

              	
                Covered
                  

                 

                Covered

              	
                Covered
                  

                 

                Covered

              	
                 

              	
                 

              	
                Covered
                  

                 

                Covered

              
	
                18.

              	
                Foot
                  Care Services

              	
                Covered

              	
                Covered

              	
                 

              	
                 

              	
                Covered

              
	
                19.

              	
                Eye
                  Care and Low Vision Services

              	
                Covered

              	
                Covered

              	
                 

              	
                 

              	
                Covered

              
	
                20.

              	
                Durable
                  Medical Equipment (DME)

              	
                Covered

              	
                Covered

              	
                 

              	
                 

              	
                Covered

              
	
                21.

              	
                Audiology,
                  Hearing Aids Services A/Products

              	
                Covered
                  except for hearing aid batteries

              	
                Covered
                  except for hearing aid batteries

              	
                Hearing
                  aid batteries

              	
                 

              	
                Covered
                  including hearing aid batteries

              
	
                22.

              	
                Family
                  Planning and Reproductive Health Services

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  Agreement

              	
                Covered
                  pursuant to Appendix C of Agreement

              	
                 

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement or through the DTP Contractor

              
	
                23.

              	
                Non-Emergency
                  Transportation

              	
                Covered
                  if included in Contractor's Benefit Package as

                per
                  Appendix M of this Agreement

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement

              	
                Covered
                  if not included in Contractor's Benefit Package

              	
                 

              	
                Not
                  covered, except for transportation to C/THP services for 19 and
                  20 year
                  olds

              
	
                24

              	
                Emergency
                  Transportation

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement

              	
                Covered
                  if not included in Contractor's Benefit Package

              	
                 

              	
                Covered

              

      

APPENDIX
      K

    January
      1, 2007 

    K-4

    

     

    
      	
              *
                See K 2 for Scope of Benefits 

            	 
	
              Note:
                If cell is blank there is no coverage

            	
              **
                No Medicaid fee for service-wrap around is available

              Subject
                to applicable co-pays

            

    

     

    

      
        	
                *

              	
                Covered
                  Services

              	
                MMC
                  Non-SSI

              	
                MMC
                  SSI

              	
                MFFS

              	 	
                FHPlus
                  **

              
	
                25.

              	
                Dental
                  Services

              	
                Covered
                  if included in Contractor's Benefit Package as per Appendix M of
                  this
                  Agreement, except orthodontia

                 

                 

              	
                Covered
                  if included in

                Contractor's
                  Benefit Package as per Appendix M of this Agreement, except
                  orthodontia

                 

              	
                Covered
                  if not included in the Contractor's Benefit Package, Orthodontia
                  in all
                  instances

                 

                 

              	 	
                Covered,
                  if included in Contractor's Benefit Package as per Appendix

                M
                  of this Agreement, excluding orthodontia

              
	
                26.

              	
                Court-Ordered
                  Services

              	
                Covered,
                  pursuant to court order (see also §10.9 of this Agreement)

              	
                Covered,
                  pursuant to court order (see also §10.9 of this Agreement)

              	 	 	
                Covered,
                  pursuant to court order (see also §10.9 of this
                  Agreement)

              
	
                27.

              	
                Prosthetic/Orthotic

                Services/Orthopedic
                  Footwear

              	
                Covered

              	
                Covered

              	 	 	
                Covered,
                  except orthopedic shoes

              
	
                28.

              	
                Mental
                  Health Services

              	
                Covered
                  subject to stop loss

              	 	
                Covered
                  for SSI Enrollees

              	 	
                Covered
                  subject to calendar year benefit limit of 30 days inpatient, 60
                  visits

                outpatient,
                  combined with chemical dependency services

              
	
                29.

              	
                Detoxification
                  Services

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                30.

              	
                Chemical
                  Dependence Inpatient Rehabilitation and 

                Treatment
                  Services

              	
                Covered
                  subject to stop loss

              	 	
                Covered
                  for SSI recipients

              	 	
                Covered
                  subject to calendar year benefit limit 30 days combined with mental
                  health
                  services

              
	
                31

              	
                Chemical
                  Dependence Outpatient

              	 	 	
                Covered

              	 	
                Covered
                  subject to calendar year benefit limits of 60 visits combined with
                  mental
                  health

                services

              
	
                32.

              	
                Experimental
                  and/or Investigational Treatment

              	
                Covered
                  on a case by case basis

              	
                Covered
                  on a case by case basis

              	 	 	
                Covered
                  on a case by case basis

              
	
                33.

              	
                Renal
                  Dialysis

              	
                Covered

              	
                Covered

              	 	 	
                Covered

              
	
                34.

              	
                Residential
                  Health Care Facility

                Services
                  (RHCF)

              	
                Covered
                  subject to stop loss, except for individuals in permanent
                  placement

              	
                Covered
                  subject to stop loss, except for individuals in permanent
                  placement

              	 	 	 

      

    

    

    

    APPENDIX
      K 

    January
      1.2007 

    K-5

     

    
      	
              *
                See K 2 for Scope of Benefits 

            	 
	
              Note:
                If cell is blank there is no coverage

            	
              **
                No Medicaid fee for service-wrap around is available

              Subject
                to applicable co-pays

            

    

    

    

    K.2

     

    PREPAID
      BENEFIT PACKAGE DEFINITIONS OF COVERED SERVICES

     

    Service
      definitions in this Section pertain to both MMC and FHPlus unless otherwise
      indicated.

     

    1.
      Inpatient Hospital Services

     

    Inpatient
      hospital services, as medically necessary, shall include, except as otherwise
      specified, the care, treatment, maintenance and nursing services as may be
      required, on an inpatient hospital basis, up to 365 days per year (366 days
      in
      leap year). The Contractor will not be responsible for hospital stays that
      commence prior to the Effective Date of Enrollment (see Section 6.8 of this
      Agreement), but will be responsible for stays that commence prior to the
      Effective Date of Disenrollment (see Section 8.5 of this Agreement).
      Among, other services, inpatient hospital services encompass a full range of
      necessary diagnostic and therapeutic care including medical, surgical, nursing,
      radiological, and rehabilitative services. Services are provided under the
      direction of a physician, certified nurse practitioner, or dentist.

     

    2.
      Inpatient Stay Pending Alternate Level of Medical Care

     

    Inpatient
      stay pending alternate level of medical care, or continued care in a hospital,
      Article 31 mental health facility, or skilled nursing facility pending placement
      in an alternate lower medical level of care, consistent with the provisions
      of
      18 NYCRR § 505.20 and 10 NYCRR Part 85.

     

    3.
      Physician Services

     

    a)
      "Physician services," whether furnished in the office, the Enrollee's home,
      a
      hospital, a skilled nursing facility, or elsewhere, means services furnished
      by
      a physician:

     

    i)
      within
      the scope of practice of medicine as defined in law by the New York State
      Education Department; and

     

    ii)
      by or
      under the personal supervision of an individual licensed and currently
      registered by the New York State Education Department to practice
      medicine.

     

    b)
      Physician services include the full range of preventive care services, primary
      care medical services and physician specialty services that fall within a
      physician's scope of practice under New York State law.

     

    c)
      The
      following are also included without limitations:

     

    i)
      pharmaceuticals and medical supplies routinely furnished or administered as
      part
      of a clinic or office visit:

    

    

    APPENDIX
      K

    January
      1, 2007

    K-6

     

    

    

    ii)
      physical examinations, including those which are necessary for employment,
      school, and camp;

     

    iii)
      physical and/or mental health, or chemical dependence examinations of children
      and their parents as requested by the LDSS to fulfill its statutory
      responsibilities for the protection of children and adults and for children
      in
      foster care;

     

    iv)
      health and mental health assessments for the purpose of making recommendations
      regarding a Enrollee's disability status for Federal SSI
      applications;

     

    v)
      health
      assessments for the Infant /Child Assessment Program (I CHAP);

     

    vi)
      annual preventive health visits for adolescents;

     

    vii)new
      admission exams for school children if required by the LDSS;

     

    viii)health
      screening, assessment and treatment of refugees, including completing SDOH/LDSS
      required forms;

     

    ix)
      Child/Teen Health Program (C/THP) services which are comprehensive primary
      health care services provided to persons under twenty-one (21) years of age
      (see
      Section 10.4 of this Agreement).

     

    4.
      Certified Nurse Practitioner Services

     

    a)
      Certified nurse practitioner services include preventive services, the diagnosis
      of illness and physical conditions, and the performance of therapeutic and
      corrective measures, within the scope of the certified nurse practitioner's
      licensure and collaborative practice agreement with a licensed physician in
      accordance with the requirements of the NYS Education Department.

     

    b)
      The
      following services are also included in the certified nurse practitioner's
      scope
      of services, without limitation:

     

    i)
      Child/Teen Health Program(C/THP) services which are comprehensive primary health
      care services provided to persons under twenty-one (21) (see Item 13 of this
      Appendix and Section 10.4 of this Agreement); 

     

    ii)
      Physical examinations, including those which are necessary for employment,
      school and camp.

    

    APPENDIX
      K

    January
      1, 2007

    K-7

     

    5.
      Midwifery Services

    SSA
§
      1905 (a)(l 7). Education Law § 6951 (i).

     

    Midwifery
      services include the management of normal pregnancy, childbirth and postpartum
      care as well as primary preventive reproductive health care to essentially
      healthy women as specified in a written practice agreement and shall include
      newborn evaluation, resuscitation and referral for infants. The care may be
      provided on an inpatient or outpatient basis, including in a birthing center
      or
      in the Enrollee's home as appropriate. The midwife must be licensed by the
      NYS
      Education Department.

     

    6.
      Preventive Health Services

     

    a)
      Preventive health services means care and services to avert disease/illness
      and/or its consequences. There are three (3) levels of preventive health
      services: 1) primary, such as immunizations, aimed at preventing disease; 2)
      secondary, such as disease screening programs aimed at early detection of
      disease; and 3) tertiary, such as physical therapy, aimed at restoring function
      after the disease has occurred. Commonly, the term "preventive care" is used
      to
      designate prevention and early detection programs rather than restorative
      programs.

     

    b)
      The
      Contractor must offer the following preventive health services essential for
      promoting and preventing illness:

     

    i)
      General health education classes.

    ii)
      Pneumonia and influenza immunizations for at risk populations.

    iii)
      Smoking cessation classes, with targeted outreach for adolescents and pregnant
      women.

    iv)
      Childbirth education classes. 

    v)
      Parenting classes covering topics such as bathing, feeding, injury prevention,
      sleeping, illness prevention, steps to follow in an emergency, growth and
      development, discipline, signs of illness, etc. vi) Nutrition counseling, with
      targeted outreach for diabetics and pregnant women. vii) Extended care
      coordination, as needed, for pregnant women. 

    viii)HIV
      counseling and testing.

     

    7.
      Second
      Medical/Surgical Opinions

     

    The
      Contractor will allow Enrollees to obtain second opinions for diagnosis of
      a
      condition, treatment or surgical procedure by a qualified physician or
      appropriate specialist, including one. affiliated with a specialty care center.
      In the event that the Contractor determines that it does not have a
      Participating Provider in its network with appropriate training and experience
      qualifying the Participating Provider to provide a second opinion, the
      Contractor shall make a referral to an appropriate Non-Participating Provider.
      The Contractor shall pay for the cost of the services associated with obtaining
      a second opinion regarding medical or surgical care, including diagnostic and
      evaluation services, provided by the Non-Participating Provider.

    APPENDIX
      K

    January
      1, 2007

    K-8

     

    

    

    8.
      Laboratory Services

    18NYCRR§505.7(a)

     

    a)
      Laboratory services include medically necessary tests and procedures ordered
      by
      a qualified medical professional and listed in the Medicaid fee schedule for
      laboratory services.

     

    b)
      All
      laboratory testing sites providing services under this Agreement must have
      a
      permit issued by the New York State Department of Health and a Clinical
      Laboratory Improvement Act (CLIA) certificate of waiver, a physician performed
      microscopy procedures (PPMP) certificate, or a certificate of registration
      along
      with a CLIA identification number. Those laboratories with certificates of
      waiver or a PPMP certificate may perform only those specific tests permitted
      under the terms of their waiver. Laboratories with certificates of registration
      may perform a full range of laboratory tests for which they have been certified.
      Physicians providing laboratory testing may perform only those specific limited
      laboratory procedures identified in the Physician's NYS Medicaid Provider
      Manual.

    

    c)
      For
      MMC only: coverage for HIV phenotypic. HIV virtual phenotypic and HIV genotypic
      drug resistance tests are covered by Medicaid fee-for-service.

     

    9.
      Radiology Services

    l8NYCRR§505.17(c)(7)(d)

     

    Radiology
      services include medically necessary services provided by qualified
      practitioners in the provision of diagnostic radiology, diagnostic ultrasound;
      nuclear medicine, radiation oncology, and magnetic resonance imaging (MRI).
      These services may only be performed upon the order of a qualified
      practitioner.

     

    10.
      Prescription and Non-Prescription (OTC) Drugs, Medical Supplies and Enteral
      Formulas

     

    a)
      For
      Medicaid fee-for-service only: Medically necessary prescription and
      non-prescription (OTC) drugs, medical supplies and enteral formula are covered
      when ordered by a qualified provider.

     

    b)
      MMC
      Enrollees are covered for prescription drugs through the Medicaid
      fee-for-service program. Pharmaceutical s and medical supplies routinely
      furnished or administered as part of a clinic or office visit are covered by
      the
      MMC Program. Self-administered injectable drugs (including those administered
      by
      a family member) and injectable drugs administered during a home care visit
      are
      covered by Medicaid fee-for-service if the drug is on the list of Medicaid
      reimbursable prescription drugs or covered by the Contractor, subject to medical
      necessity, if the drug is not on the list of Medicaid reimbursable prescription
      drugs.

     

    APPENDIX
      K

    January
      1, 2007

    K-9

     

    

    

    c)
      For
      Family Health Plus only:

     

    i)
      Prescription drugs are covered, but may be limited to generic medications where
      medically acceptable. All medications used for preventive and therapeutic
      purposes are covered, as well as family planning or contraceptive medications
      or
      devices.

     

    ii)
      Coverage includes enteral formulas for home use for which a physician or other
      provider authorized to prescribe has issued a written order. Enteral formulas
      for the treatment of specific diseases shall be distinguished from nutritional
      supplements taken electively. Coverage for certain inherited diseases of amino
      acid and organic acid metabolism shall include modified solid food products
      that
      are low-protein or which contain modified protein. Vitamins are not covered
      except when necessary to treat a diagnosed illness or condition.

     

    iii)
      Experimental and/or investigational drugs are generally excluded, except where
      approved in the course of experimental/investigational treatment.

     

    iv)
      Drugs
      prescribed for cosmetic purposes are excluded.

     

    v)
      Over-the-counter items are excluded with the exception of diabetic supplies,
      including insulin and smoking cessation agents. Non-prescription (OTC) drugs
      and
      medical supplies are not covered.

     

    11.
      Smoking Cessation Products

     

    a)
      MMC
      Enrollees are covered for smoking cessation products through the Medicaid
      fee-for-service program.

     

    b)
      For
      Family Health Plus only: At least two courses of smoking cessation therapy
      per
      person per year, as medically necessary are covered. A course of therapy is
      defined as no more than a ninety (90)day supply (an original prescription and
      two (2) refills, even if less than a thirty (30)day supply is dispensed in
      any
      fill). Duplicative use of one agent is not allowed (i.e., same drug/same dosage
      form/same strength). Both prescription and over-the-counter therapies/agents
      are
      covered; this includes nicotine patches, inhalers, nasal sprays, gum, and Zyban
      (bupropion).

     

    12.
      Rehabilitation Services

    18NYCRR§505.11

     

    a)
      Rehabilitation services are provided for the maximum reduction of physical
      or
      mental disability and restoration of the Enrollee to his or her best functional
      level. Rehabilitation services include care and services rendered by physical
      therapists. speech-language pathologists and occupational therapists.
      Rehabilitation services may be provided in an Article 28 inpatient or outpatient
      facility, in an Enrollee's home, in an approved home health agency, in the
      office of a qualified private practicing therapist or speech pathologist, or
      for
      a child in a school, pre-school or

    

    

    APPENDIX
      K

    January
      1, 2007

    K-10

     

    

    

    community
      setting, or in a Residential Health Care Facility (RHCF) as long as the
      Enrollee's stay is classified as a rehabilitative stay and meets the
      requirements for covered RHCF services as defined herein. For the MMC Program,
      rehabilitation services provided in Residential Health Care Facilities are
      subject to the stop-loss provisions specified in Section 3.13 of this Agreement.
      Rehabilitation services are covered as medically necessary, when ordered by
      the
      Contractor's Participating Provider.

     

    b)
      For
      Family Health Plus only: Outpatient visits for physical and occupational therapy
      is limited to twenty (20) visits per calendar year. Coverage for speech therapy
      services is limited to those required for a condition amenable to significant
      clinical improvement within a two month period.

     

    13.
      Early and Periodic Screening, Diagnostic and Treatment (EPSDT) Services Through
      the Child Teen Health Program (C/THP) and Adolescent Preventive
      Services

    18NYCRR§508.8

     

    Child/Teen
      Health Program (C/THP) is a package of early and periodic screening, including
      inter-periodic screens and, diagnostic and treatment services that New York
      State offers all Medicaid eligible children under twenty-one (21) years of
      age.
      Care and services shall be provided in accordance with the periodicity schedule
      and guidelines developed by the New York State Department of Health. The care
      includes necessary health care, diagnostic services, treatment and other
      measures (described in §1905(a) of the Social Security Act) to correct or
      ameliorate defects, and physical and mental illnesses and conditions discovered
      by the screening services (regardless of whether the service is otherwise
      included in the New York State Medicaid Plan). The package of services includes
      administrative services designed to assist families obtain services for children
      including outreach, education, appointment scheduling, administrative case
      management and transportation assistance.

     

    14.
      Home Health Services

    18NYCRR§505.23(a)(3)

     

    a)
      Home
      health care services are provided to Enrollees in their homes by a home health
      agency certified under Article 36 of the PHL (Certified Home Health Agency
      -CHHA). Home health services mean the following services when prescribed by
      a
      Provider and provided to a Enrollee in his or her home:

     

    i)
      nursing services provided on a part-time or intermittent basis by a CHHA or,
      if
      there is no CHHA that services the county/district, by a registered professional
      nurse or a licensed practical nurse acting under the direction of the Enrollee's
      PCP;

     

    ii)
      physical therapy, occupational therapy, or speech pathology and audiology
      services; and

    

    

    APPENDIX
      K

    January
      1, 2007

    K-11

     

    

    

    iii)
      home
      health services provided by a person who meets the training requirements of
      the
      SDOH, is assigned by a registered professional nurse to provide home health
      aid
      services in accordance with the Enrollee's plan of care, and is supervised
      by a
      registered professional nurse from a CHHA or if the Contractor has no CHHA
      available, a registered nurse, or therapist.

     

    b)
      Personal care tasks performed by a home health aide incidental to a certified
      home health care agency visit, and pursuant to an established care plan, are
      covered.

     

    c)
      Services include care rendered directly to the Enrollee and instructions to
      his/her family or caretaker such as teacher or day care provider in the
      procedures necessary for the Enrollee's treatment or maintenance.

     

    d)
      The
      Contractor must provide up to two (2) post partum home visits for high risk
      infants and/or high risk mothers, as well as to women with less than a
      forty-eight (48) hour hospital stay after a vaginal delivery or less than a
      ninety-six (96) hour stay after a cesarean delivery. Visits must be made by
      a
      qualified health professional (minimum qualifications being an RN with
      maternal/child health background), the first visit to occur within forty-eight
      (48) hours of discharge.

     

    e)
      For
      Family Health Plus only: coverage is limited to forty (40) home health care
      visits per calendar year in lieu of a skilled nursing facility stay or
      hospitalization. Post partum home visits apply only to high risk mothers. For
      the purposes of this Section, visit is defined as the delivery of a discreet
      service (e.g. nursing, OT, PT, ST. audiology or home health aide). Four (4)
      hours of home health aide services equals one visit.

     

    15.
      Private Duty Nursing Services - For MMC Program Only

     

    a)
      Private duty nursing services shall be provided by a person possessing a license
      and current registration from the NYS Education Department to practice as a
      registered professional nurse or licensed practical nurse. Private duty nursing
      services must be provided in the MMC Enrollee's home and can be provided through
      an approved certified home health agency, a licensed home care agency, or a
      private Practitioner.

     

    b)
      Private duty nursing services are covered only when determined by the attending
      physician to be medically necessary. Nursing services may be intermittent,
      part-time or continuous and must be provided in an Enrollee's home in accordance
      with the ordering physician's or certified nurse practitioner's written
      treatment plan.

     

    16.
      Hospice Services

     

    a)
      Hospice Services means a coordinated hospice program of home and inpatient
      services which provide non-curative medical and support services for Enrollees
      certified by a physician to be terminally ill with a life expectancy of six
      (6)
      months or less.

    
 

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    b)
      Hospice services include palliative and supportive care provided to an Enrollee
      to meet the special needs arising out of physical, psychological, spiritual,
      social and economic stress which are experienced during the final stages of
      illness and during dying and bereavement. Hospices must be certified under
      Article 40 of the New York State Public Health Law. All services must be
      provided by qualified employees and volunteers of the hospice or by qualified
      staff through contractual arrangements to the extent permitted by federal and
      state requirements. All services must be provided according to a written plan
      of
      care which reflects the changing needs of the Enrollee and the Enrollee's
      family. Family members are eligible for up to five visits for bereavement
      counseling.

     

    c)
      Medicaid Managed Care Enrollees receive coverage for hospice services through
      the Medicaid fee-for-service program.

     

    17.
      Emergency Services

     

    a)
      Emergency conditions, medical or behavioral, the onset of which is sudden,
      manifesting itself by symptoms of sufficient severity, including severe pain.
      that a prudent layperson, possessing an average knowledge of medicine and
      health, could reasonably expect the absence of medical attention to result
      in
      (a) placing the health of the person afflicted with such condition in serious
      jeopardy, or in the case of a behavioral condition, placing the health of such
      person or others in serious jeopardy;

    (b)
      serious impairment of such person's bodily functions; (c) serious dysfunction
      of
      any bodily organ or part of such person; or (d) serious disfigurement of such
      person are covered. Emergency services include health care procedures,
      treatments or services needed to evaluate or stabilize an Emergency Medical
      Condition including psychiatric stabilization and medical detoxification from
      drugs or alcohol. A medical assessment (triage) is covered for non-emergent
      conditions. See also Appendix G of this Agreement.

     

    b)
      Post
      Stabilization Care Services means services related to an emergency medical
      condition that are provided after an Enrollee is stabilized in order to maintain
      the stabilized condition, or to improve or resolve the Enrollee's condition.
      These services are covered pursuant to Appendix G of this
      Agreement.

     

    18.
      Foot Care Services

    

    a)
      Covered services must include routine foot care when the physical condition
      of
      any Enrollee (regardless of age) poses a hazard due to the presence of localized
      illness, injury or symptoms involving the foot, or when performed as a necessary
      and integral part of otherwise covered services such as the diagnosis and
      treatment of diabetes, ulcers, and infections.

     

    b)
      Services provided by a podiatrist for persons under twenty-one (21) must be
      covered upon referral of a physician, registered physician assistant, certified
      nurse practitioner or licensed midwife.

    

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    c)
      Routine hygienic care of the feet, the treatment of corns and calluses, the
      trimming of nails, and other hygienic care such as cleaning or soaking feet,
      is
      not covered in the absence of a pathological condition.

     

    19.
      Eye Care and Low Vision Services

    18NYCRR§505.6(b)(l-3)
      

    SSL§369-ee(l)(e)(xh)

     

    a)
      For
      Medicaid Managed Care only:

     

    i)
      Emergency, preventive and routine eye care services are covered. Eye care
      includes the services of ophthalmologist, optometrists and ophthalmic
      dispensers, and includes eyeglasses, medically necessary contact lenses and
      polycarbonate lenses, artificial eyes (stock or custom-made), low vision aids
      and low vision services. Eye care coverage includes the replacement of lost
      or
      destroyed eyeglasses. The replacement of a complete pair of eyeglasses must
      duplicate the original prescription and frames. Coverage also includes the
      repair or replacement of parts in situations where the damage is the result
      of
      causes other than defective workmanship. Replacement parts must duplicate the
      original prescription and frames. Repairs to, and replacements of, frames and/or
      lenses must be rendered as needed.

     

    ii)
      If
      the Contractor does not provide upgraded eyeglass frames or additional features
      (such as scratch coating, progressive lenses or photo-gray lenses) as part
      of
      its covered vision benefit, the Contractor cannot apply the cost of its covered
      eyeglass benefit to the total cost of the eyeglasses the Enrollee wants and
      bill
      only the difference to the Enrollee. The Enrollee can choose to purchase the
      upgraded frames and/or additional features by paying the entire cost of the
      eyeglasses as a private customer. For example, if the Contractor covers standard
      bifocal eyeglasses and the Enrollee wants no-line bifocal eyeglasses, the
      Enrollee must choose between taking the standard bifocal eyeglasses or paying
      the full price of the no-line bifocal eyeglasses (not just the difference
      between the cost of biofocal lenses and the no-line lenses). The Enrollee must
      be informed of this fact by the vision care provider at the time that the
      glasses are ordered.

     

    iii)
      Examinations for diagnosis and treatment for visual defects and/or eye disease
      are provided only as necessary and as required by the Enrollee's particular
      condition. Examinations which include refraction are limited to once every
      twenty four (24) months unless otherwise justified as medically
      necessary.

     

    iv)
      Eyeglasses do not require changing more frequently than once every twenty four
      (24) months unless medically indicated, such as a change in correction greater
      than Vi
      diopter,
      or unless the glasses are lost, damaged, or destroyed.

     

    v)
      An
      ophthalmic dispenser fills the prescription of an optometrist or ophthalmologist
      and supplies eyeglasses or other vision aids upon the order of a qualified
      practitioner.

    

    

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    vi)
      MMC
      Enrollees may self-refer to any Participating Provider of vision services
      (optometrist or ophthalmologist) for refractive vision services not more
      frequently than once every twenty four (24) months, or if otherwise justified
      as
      medically necessary or if eyeglasses are lost, damaged or destroyed as described
      above.

     

    b)
      For
      Family Health Plus only:

     

    i)
      Covered Services include emergency vision care and the following preventive
      and
      routine vision care provided once in any twenty-four (24) month
      period:

    A)
      one
      eye examination;

     

    B)
      either: one pair of prescription eyeglass lenses and a frame, or prescription
      contact lenses where medically necessary; and

     

    C)
      one
      pair of medically necessary occupational eyeglasses.

     

    ii)
      An
      ophthalmic dispenser fills the prescription of an optometrist or ophthalmologist
      and supplies eyeglasses or other vision aids upon the order of a qualified
      practitioner.

     

    iii)
      FHPlus Enrollees may self-refer to any Participating Provider of vision services
      (optometrist or ophthalmologist) for refractive vision services not more
      frequently than once every twenty four (24) months.

     

    iv)
      If
      the Contractor does not provide upgraded frames or additional features that
      the
      Enrollee wants (such as scratch coating, progressive lenses or photo-gray
      lenses) as part of its covered vision benefit, the Contractor cannot apply
      the
      cost of its covered eyeglass benefit to the total cost of the eyeglasses the
      Enrollee wants and bill only the difference to the Enrollee. The Enrollee can
      choose to purchase the upgraded frames and/or additional features by paying
      the
      entire cost of the eyeglasses as a private customer. For example, if the
      Contractor covers standard bifocal eyeglasses and the Enrollee wants no-line
      bifocal eyeglasses, the Enrollee must choose between taking the standard bifocal
      glasses or paying the full price for the no-line bifocal eyeglasses (not just
      the difference between the cost of bifocal lenses and no-line lenses). The
      Enrollee must be informed of this fact by the vision care provider at the time
      that the glasses are ordered. 

     

    v)
      Contact lenses are covered only when medically necessary. Contact lenses shall
      not be covered solely because the FHPlus Enrollee selects contact lenses in
      lieu
      of receiving eyeglasses.

     

    vi)
      Coverage does not include the replacement of lost, damaged or destroyed
      eyeglasses.

     

    vii)
      The
      occupational vision benefit for FHPlus Enrollees covers the cost of job-related
      eyeglasses if that need is determined by a Participating Provider through
      special testing, done in conjunction with a regular vision examination.
      Such

    

    

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    examination
      shall determine whether a special pair of eyeglasses would improve the
      performance of job-related activities. Occupational eyeglasses can be provided
      in addition to regular glasses but are available only in conjunction with a
      regular vision benefit once in any twenty-four (24) month period. FHPlus
      Enrollees may purchase an upgraded frame or lenses for occupational eyeglasses
      by paying the entire cost as a private customer. Sun-sensitive and polarized
      lens options are not available for occupational eyeglasses.

     

    20.
      Durable Medical Equipment (DME)

    18
      NYCRR
§ 505.5(a)(l) and Section 4.4 of the NYS Medicaid DME, Medical and Surgical
      Supplies and Prosthetic and Orthotic Appliances Provider Manual

     

    a)
      Durable Medical Equipment (DME) are devices and equipment, other than
      medical/surgical supplies, enteral formula, and prosthetic or orthotic
      appliances, and have the following characteristics:

     

    i)
      can
      withstand repeated use for a protracted period of time;

    ii)
      are
      primarily and customarily used for medical purposes;

    iii)
      are
      generally not useful to a person in the absence of illness or injury; and iv)
      are usually not fitted, designed or fashioned for a particular individual's
      use.

    Where
      equipment is intended for use by only one (1) person, it may be
      either

    custom
      made or customized.

     

    b)
      Coverage includes equipment servicing but excludes disposable medical
      supplies.

     

    21.
      Audiology, Hearing Aid Services and Products

    18
      NYCRR
§ 505.31 (a)(1)(2) and Section 4.7 of the NYS Medicaid Hearing Aid Provider
      Manual

     

    a)
      Hearing aid services and products are provided in compliance with Article 37-A
      of the General Business Law when medically necessary to alleviate disability
      caused by the loss or impairment of hearing. Hearing aid services include:
      selecting, fitting and dispensing of hearing aids, hearing aid checks following
      dispensing of hearing aids, conformity evaluation, and hearing aid
      repairs.

     

    b)
      Audiology services include audiometric examinations and testing, hearing aid
      evaluations and hearing aid prescriptions or recommendations, as medically
      indicated.

     

    c)
      Hearing aid products include hearing aids, earmolds. special fittings, and
      replacement parts.

     

    d)
      Hearing aid batteries:

     

    i)
      For
      Family Health Plus only: Hearing aid batteries are covered as part of the
      prescription drug benefit.

    

    

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    ii)
      For
      Medicaid Managed Care only: Hearing aid batteries are covered through the
      Medicaid fee-for-service program.

     

    22.
      Family Planning and Reproductive Health Care

     

    a)
      Family
      Planning and Reproductive Health Care services means the offering, arranging
      and
      furnishing of those health services which enable Enrollees, including minors
      who
      may be sexually active, to prevent or reduce the incidence of unwanted
      pregnancy, as specified in Appendix C of this Agreement.

     

    b)
      HIV
      counseling and testing is included in coverage when provided as part of a Family
      Planning and Reproductive Health visit.

     

    c)
      All
      medically necessary abortions are covered, as specified in Appendix C of this
      Agreement.

     

    d)
      Fertility services are not covered.

     

    e)
      If the
      Contractor excludes Family Planning and Reproductive Health services from its
      Benefit Package, as specified in Appendix M of this Agreement, the Contractor
      is
      required to comply with the requirements of Appendix C.3 of this Agreement
      and
      still provide the following services:

     

    i)
      screening, related diagnosis, ambulatory treatment, and referral to
      Participating Provider as needed for dysmenorrhea, cervical cancer or other
      pelvic abnormality/pathology;

     

    ii)
      screening, related diagnosis, and referral to Participating Provider for anemia,
      cervical cancer, glycosuria, proteinuria, hypertension, breast disease and
      pregnancy.

     

    23.
      Non-Emergency Transportation

     

    a)
      Transportation expenses are covered for MMC Enrollees when transportation is
      essential in order for a MMC Enrollee to obtain necessary medical care and
      services which are covered under the Medicaid program (either as part of the
      Contractor's Benefit Package or by Medicaid fee-for-service). Non-emergent
      transportation guidelines may be developed in conjunction with the LDSS, based
      on the LDSS' approved transportation plan.

     

    b)
      Transportation services means transportation by ambulance, ambulette fixed
      wing
      or airplane transport, invalid coach, taxicab, livery, public transportation,
      or
      other means appropriate to the MMC Enrollee's medical condition; and a
      transportation attendant to accompany the MMC Enrollee. if necessary. Such
      services may include the transportation attendant's transportation, meals,
      lodging and salary; however, no salary will be paid to a transportation
      attendant who is a member of the MMC Enrollee's family.

    

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    c)
      When
      the Contractor is capitated for non-emergency transportation, the Contractor
      is
      also responsible for providing transportation to Medicaid covered services
      that
      are not part of the Contractor's Benefit Package.

     

    d)
      Non-emergency transportation is covered for FHPlus Enrollees that are nineteen
      (19) or twenty (20) years old and are receiving C/THP services.

     

    e)
      For
      MMC Enrollees with disabilities, the method of transportation must reasonably
      accommodate their needs, taking into account the severity and nature of the
      disability.

     

    24.
      Emergency Transportation

     

    a)
      Emergency transportation can only be provided by an ambulance service, including
      air ambulance service. Emergency ambulance transportation means the provision
      of
      ambulance transportation for the purpose of obtaining hospital services for
      an
      Enrollee who suffers from severe, life-threatening or potentially disabling
      conditions which require the provision of Emergency Services while the Enrollee
      is being transported.

     

    b)
      Emergency Services means the health care procedures, treatments or services
      needed to evaluate or stabilize an Emergency Medical Condition including, but
      not limited to, the treatment of trauma, burns, respiratory, circulatory and
      obstetrical emergencies.

     

    c)
      Emergency ambulance transportation is transportation to a hospital emergency
      room generated by a "Dial 911" emergency system call or some other request
      for
      an immediate response to a medical emergency. Because of the urgency of the
      transportation request, insurance coverage or other billing provisions are
      not
      addressed until after the trip is completed. When the Contractor is capitated
      for this benefit, emergency transportation via 911 or any other emergency call
      system is a covered benefit and the Contractor is responsible for payment.
      The
      Contractor shall reimburse the transportation provider for all emergency
      ambulance services without regard for final diagnosis or prudent layperson
      standard.

     

    25.
      Dental Services

     

    a)
      Dental
      care includes preventive, prophylactic and other routine dental care, services,
      supplies and dental \prosthetics required to alleviate a serious health
      condition, including one which affects employability. Orthodontic services
      are
      not covered.

     

    b)
      Dental
      surgery performed in an ambulatory or inpatieni setting is the responsibility
      of
      the Contractor, whether dental services are included in the Benefit Package
      or
      not. Inpatient claims and referred ambulatory claims for dental services
      provided in an inpatient or outpatient hospital setting for surgery,
      anesthesiology. X-rays, etc. are the responsibility of the Contractor. The
      Contractor shall set up procedures to prior approve dental services provided
      in
      inpatient and ambulatory settings.

     

    c)
      For
      Medicaid Managed Care only:

    

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    i)
      As
      described in Sections 10.15 and 10.27 of this Agreement, Enrollees may
      self-refer to Article 28 clinics operated by academic dental centers to obtain
      covered

    dental
      services if dental services are included in the Benefit Package. 

    ii)
      Professional services of a dentist for dental surgery performed in an
      ambulatory 01-inpatient setting are billed Medicaid fee-for-service if the
      Contractor does not include dental services in the benefit package.

     

    d)
      For
      Family Health Plus only: professional services of a dentist for dental surgery
      performed in an ambulatory or inpatient setting are not covered.

     

    26.
      Court Ordered Services

     

    Court
      ordered services are those services ordered by a court of competent jurisdiction
      which are performed by or under the supervision of a physician, dentist, or
      other provider qualified under State law to furnish medical, dental, behavioral
      health (including treatment for mental health and/or chemical dependence),
      or
      other covered services. The Contractor is responsible for payment of those
      services included in the benefit package.

     

    27.
      Prosthetic/Orthotic Orthopedic Footwear

     

    Section
      4.5, 4.6 and 4.7 of the NYS Medicaid DME, Medical and Surgical Supplies and
      Prosthetic and Orthotic Appliances Provider Manual

     

    a)
      Prosthetics are those appliances or devices which replace or perform the
      function of any missing part of the body. Artificial eyes are covered as part
      of
      the eye care benefit.

     

    b)
      Orthotics are those appliances or devices which are used for the purpose of
      supporting a weak or deformed body part or to restrict or eliminate motion
      in a
      diseased or injured part of the body.

     

    c)
      Medicaid Managed Care: Orthopedic Footwear means shoes, shoe modifications,
      or
      shoe additions which are used to correct, accommodate or prevent a physical
      deformity or range of motion malfunction in a diseased or injured part of the
      ankle or foot; to support a weak or deformed structure of the ankle or foot,
      or
      to form an integral part of a brace.

     

    28.
      Mental Health Services 

     

    a)
      Inpatient Services

     

    All
      inpatient mental health services, including voluntary or involuntary admissions
      for mental health services. The Contractor may provide the covered benefit
      for
      medically necessary mental health inpatient services through hospitals licensed
      pursuant to Article 28 of the PHL.

     

    b)
      Outpatient Services

    

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    Outpatient
      services including but not limited to: assessment, stabilization, treatment
      planning, discharge planning, verbal therapies, education, symptom management.
      case management services, crisis intervention and outreach services, chlozapine
      monitoring and collateral services as certified by the New York State Office
      of
      Mental Health (OMH). Services may be provided in-home, in an office or in the
      community. Services may be provided by licensed OMH providers or by other
      providers of mental health services, including clinical psychologists and
      physicians.

     

    c)
      Family
      Health Plus Enrollees have a combined mental health/chemical dependency benefit
      limit of thirty (30) days inpatient and sixty (60) outpatient visits per
      calendar year.

     

    d)
      MMC
      SSI Enrollees obtain all mental health services through the Medicaid
      fee-for-service program.

     

    29.
      Detoxification Services

     

    a)
      Medically Managed Inpatient Detoxification

     

    These
      programs provide medically directed twenty-four (24) hour care on an inpatient
      basis to individuals who are at risk of severe alcohol or substance abuse
      withdrawal, incapacitated, a risk to self or others, or diagnosed with an acute
      physical or mental co-morbidity. Specific services include, but are not limited
      to: medical management, bio-psychosocial assessments, stabilization of medical
      psychiatric / psychological problems, individual and group counseling, level
      of
      care determinations and referral and linkages to other services as necessary.
      Medically Managed Detoxification .Services are provided by facilities licensed
      by OASAS under Title 14 NYCRR § 816.6 and the Department of Health as a general
      hospital pursuant to Article 28 of the Public Health Law or by the Department
      of
      Health as a general hospital pursuant to Article 28 of the Public Health
      Law.

     

    b)
      Medically Supervised Withdrawal

     

    i)
      Medically Supervised Inpatient Withdrawal

     

    These
      programs offer treatment for moderate withdrawal on an inpatient basis. Services
      must include medical supervision and direction under the care of a physician
      in
      the treatment for moderate withdrawal. Specific services must include, but
      are
      not limited to: medical assessment within twenty four (24) hours of admission;
      medical supervision of intoxication and withdrawal conditions; bio-psychosocial
      assessments; individual and group counseling and linkages to other services
      as
      necessary. Maintenance on methadone while a patient is being treated for
      withdrawal from other substances may be provided where the provider is
      appropriately authorized. Medically Supervised Inpatient Withdrawal services
      are
      provided by facilities licensed under Title 14 NYCRR § 816.7.

     

    ii)
      Medically Supervised Outpatient Withdrawal

    

    

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    These
      programs offer treatment for moderate withdrawal on an outpatient basis.
      Required services include, but are not limited to: medical supervision of
      intoxication and withdrawal conditions; bio-psychosocial assessments; individual
      and group counseling; level of care determinations; discharge planning; and
      referrals to appropriate services. Maintenance on methadone while a patient
      is
      being treated for withdrawal from other substances may be provided where the
      provider is appropriately authorized. Medically Supervised Outpatient Withdrawal
      services are provided by facilities licensed under Title 14 NYCRR
§816.7.

     

    c)
      For
      Medicaid Managed Care only: all detoxification and withdrawal services are
      a
      covered benefit for all Enrollees. including those categorized as SSI or
      SSI-related. Detoxification Services in Article 28 inpatient hospital facilities
      are subject to the inpatient hospital stop-loss provisions specified in Section
      3.11 of this Agreement.

     

    30.
      Chemical Dependence Inpatient Rehabilitation and Treatment
      Services

     

    a)
      Services provided include intensive management of chemical dependence symptoms
      and medical management of physical or mental complications from chemical
      dependence to clients who cannot be effectively served on an outpatient basis
      and who are not in need of medical detoxification or acute care. These services
      can be provided in a hospital or free-standing facility. Specific services
      can
      include, but are not limited to: comprehensive admission evaluation and
      treatment planning;

    individual
      group, and family counseling; awareness and relapse prevention;

    education
      about self-help groups; assessment and referral services; vocational and
      educational assessment; medical and psychiatric consultation; food and housing;
      and HIV and AIDS education. These services may be provided by facilities
      licensed by the New York State Office of Alcoholism and Substance Abuse Services
      (OASAS) to provide Chemical Dependence Inpatient Rehabilitation and Treatment
      Services under Title 14 NYCRR Part 818. Maintenance on methadone while a patient
      is being treated for withdrawal from other substances may be provided where
      the
      provider is appropriately authorized.

     

    b)
      Family
      Health Plus Enrollees have a combined mental health/chemical dependency benefit
      limit of thirty (30) days inpatient and sixty (60) outpatient visits per
      calendar year.

    

    31. 
      Outpatient Chemical Dependency Services

     

    a)
      Medically Supervised Ambulatory Chemical Dependence Outpatient Clinic
      Programs

     

    Medically
      Supervised Ambulatory Chemical Dependence Outpatient Clinic Programs are
      licensed under Title 14. NYCRR Part 822 and provide chemical dependence
      outpatient treatment to individuals who suffer from chemical abuse or dependence
      and their family members or significant others.

     

    b)
      Medically Supervised Chemical Dependence Outpatient Rehabilitation
      Programs

    
 

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    Medically
      Supervised Chemical Dependence Outpatient Rehabilitation Programs provide full
      or half-day services to meet the needs of a specific target population of
      chronic alcoholic persons who need a range of services which are different
      from
      those typically provided in an alcoholism outpatient clinic. Programs are
      licensed by as Chemical Dependence Outpatient Rehabilitation Programs under
      Title 14 NYCRR § 822.9.

     

    c)
      Outpatient Chemical Dependence for Youth Programs

     

    Outpatient
      Chemical Dependence for Youth Programs (OCDY) are licensed under Title 14 NYCRR
      Part 823. OCDY programs offer discrete, ambulatory clinic services to
      chemically-dependent youth in a treatment setting that supports abstinence
      from
      chemical dependence (including alcohol and substance abuse)
      services.

     

    d)
      Medicaid Managed Care Enrollees access outpatient chemical dependency services
      through the Medicaid fee-for-service program.

     

    32.
      Experimental and/or Investigational Treatment

     

    a)
      Experimental and/or investigational treatment are covered on a case by case
      basis.

     

    b)
      Experimental and/or investigational treatment for life-threatening and/or
      disabling illnesses may also be considered for coverage under the external
      appeal process pursuant to the requirements of Section 4910 of the PHL under
      the
      following conditions:

     

    i)
      The
      Enrollee has had coverage of a health care service denied on the basis that
      such
      service is experimental and/or investigational, and

     

    ii)
      The
      Enrollee's attending physician has certified that the Enrollee has a
      life-threatening or disabling condition or disease:

     

    A)
      for
      which standard health services or procedures have been ineffective or would
      be
      medically inappropriate, or

     

    B)
      for
      which there does not exist a more beneficial standard health service or
      procedure covered by the Contractor, or

     

    C)
      for
      which there exists a clinical trial, and

     

    iii)
      The
      Enrollee's  provider, who must be a licensed, board-certified or
      board-eligible physician, qualified to practice in the area of practice
      appropriate to treat the Enrollee's life-threatening or disabling condition
      or
      disease, must have recommended either:

     

    A)
      a
      health service or procedure that, based on two (2) documents from the available
      medical and scientific evidence, is likely to be more beneficial to the Enrollee
      than any covered standard health service or procedure; or

    

    

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    B)
      a
      clinical trial for which the Enrollee is eligible; and

     

    iv)
      The
      specific health service or procedure recommended by the attending physician
      would otherwise be covered except for the Contractor's determination that the
      health service or procedure is experimental and/or investigational.

     

    33.
      Renal Dialysis

     

    Renal
      dialysis may be provided in an inpatient hospital setting, in an ambulatory
      care
      facility, or in the home on recommendation from a renal dialysis
      center.

     

    34.
      Residential Health Care Facility (RHCF) Services - For MMC Program
      Only

     

    a)
      Residential Health Care Facility (RHCF) Services means inpatient nursing home
      services provided by facilities licensed under Article 28 of the New York State
      Public Health Law, including AIDS nursing facilities. Covered services includes
      the following health care services: medical supervision, twenty-four (24) hour
      per day nursing care, assistance with the activities of daily living, physical
      therapy, occupational therapy, and speech/language pathology services and other
      services as specified in the New York State Health Law and Regulations for
      residential health care facilities and AIDS nursing facilities. These services
      should be provided to an MMC Enrollee:

     

    i)
      Who is
      diagnosed by a physician as having one or more clinically determined illnesses
      or conditions that cause the MMC Enrollee to be so incapacitated, sick, invalid,
      infirm, disabled, or convalescent as to require at least medical and nursing
      care; and

     

    ii)
      Whose
      assessed health care needs, in the professional judgment of the MMC Enrollee's
      physician or a medical team:

     

    A)
      do not
      require care or active treatment of the MMC Enrollee in a general or special
      hospital;

     

    B)
      cannot
      be met satisfactorily in the MMC Enrollee's own home or home substitute
      through provision of such home health services, including medical and other
      health and health-related services as are available in or near his or her
      community; and

     

    C)
      cannot
      be met satisfactorily in the physician's office, a hospital clinic, or other
      ambulatory care setting because of the unavailability of medical or other health
      and health-related services for the MMC Enrollee in such setting in or near
      his
      or her community.

     

    b)
      The
      Contractor is also responsible for respite days and bed hold days authorized
      by
      the Contractor.

     

    c)
      The
      Contractor is responsible for all medically necessary and clinically appropriate
      inpatient Residential Health Care Facility services authorized by the Contractor
      up to a sixty (60) day calendar year stop-loss for MMC Enrollees who are not
      in
      Permanent Placement Status as determined by LDSS.

    

    

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    K.3

     

    Medicaid
      Managed Care Prepaid Benefit Package Definitions of Non-Covered
      Services

     

    The
      following services are excluded from the Contractor's Benefit Package, but
      are
      covered, in most instances, by Medicaid fee-for-service:

     

    1.
      Medical Non-Covered Services

     

    a)
      Personal Care Agency Services

     

    i)
      Personal care services (PCS) are the provision of some or total assistance
      with
      personal hygiene, dressing and feeding; and nutritional and environmental
      support (meal preparation and housekeeping). Such services must be essential
      to
      the maintenance of the Enrollee's health and safety in his or her own home.
      The
      service has to be ordered by a physician, and there has to be a medical need
      for
      the service. Licensed home care services agencies, as opposed to certified
      home
      health agencies, are the primary providers of PCS. Enrollees receiving PCS
      have
      to have a stable medical condition and are generally expected to be in receipt
      of such services for an extended period of time (years).

     

    ii)
      Services rendered by a persona] care agency which are approved by the LDSS
      are
      not covered under the Benefit Package. Should it be medically necessary for
      the
      PCP to order personal care agency services, the PCP (or the Contractor on the
      physician's behalf) must first contact the Enrollee's LDSS contact person for
      personal care. The district will determine the Enrollee's need for personal
      care
      agency services and coordinate with the personal care agency to develop a plan
      of care.

     

    b)
      Residential Health Care Facilities (RHCF)

     

    Services
      provided in a Residential Health Care Facility (RHCF) to an individual who
      is
      determined by the LDSS to be in Permanent Status are not covered.

     

    c)
      Hospice Program

     

    i)
      Hospice is a coordinated program of home and inpatient care that provides
      non-curative medical and support services for persons certified by a physician
      to be terminally ill with a life expectancy of six (6) months or less. Hospice
      programs provide patients and families with palliative and supportive care
      to
      meet the special needs arising out of physical, psychological, spiritual, social
      and economic stresses which are experienced during the final stages of illness
      and during dying and bereavement.

     

    ii)
      Hospices are organizations which must be certified under Article 40 of the
      PHL.
      All services must be provided by qualified employees and volunteers of
      the

    

    

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    hospice
      or by qualified staff through contractual arrangements to the extent permitted
      by federal and state requirements. All services must be provided according
      to a
      written plan of care which reflects the changing needs of the
      patient/family.

     

    iii)
      If
      an Enrollee becomes terminally ill and receives Hospice Program services, he
      or
      she may remain enrolled and continue to access the Contractor's Benefit Package
      while Hospice costs are paid for by Medicaid fee-for-service.

     

    d)
      Prescription and Non-Prescription (OTC) Drugs, Medical Supplies, and Enteral
      Formula

     

    Coverage
      for drugs dispensed by community pharmacies, over the counter drugs,
      medical/surgical supplies and enteral formula are not included in the Benefit
      Package and will be paid for by Medicaid fee-for-service. Medical/surgical
      supplies are items other than drugs, prosthetic or orthotic appliances, or
      DME
      which have been ordered by a qualified practitioner in the treatment of a
      specific medical condition and which are: consumable, non-reusable, disposable,
      or for a specific rather than incidental purpose, and generally have no
      salvageable value (e.g. gauze pads, bandages and diapers). Pharmaceuticals
      and
      medical supplies routinely furnished or administered as part of a clinic or
      office visit are covered.

     

    2.
      Non-Covered Behavioral Health Services

     

    a)
      Chemical Dependence Services

     

    i)
      Outpatient Rehabilitation and Treatment Services

    

    A)
      Methadone Maintenance Treatment Program (MMTP)

    

    Consists
      of drug detoxification, drug dependence counseling, and rehabilitation services
      which include chemical management of the patient with methadone. Facilities
      that
      provide methadone maintenance treatment do so as their principal mission and
      are
      certified by OASAS under 14 NYCRR Part 828.

    

    B)
      Medically Supervised Ambulatory Chemical Dependence Outpatient Clinic
      Programs

    

    Medically
      Supervised Ambulatory Chemical Dependence Outpatient Clinic Programs are
      licensed under Title 14 NYCRR Part 822 and provide chemical dependence
      outpatient treatment to individuals who suffer from chemical abuse or dependence
      and their family members or significant others.

    

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    C)
      Medically Supervised Chemical Dependence Outpatient Rehabilitation
      Programs

     

    Medically
      Supervised Chemical Dependence Outpatient Rehabilitation Programs provide full
      or half-day services to meet the needs of a specific target population of
      chronic alcoholic persons who need a range of services which are different
      from
      those typically provided in an alcoholism outpatient clinic. Programs are
      licensed by as Chemical Dependence Outpatient Rehabilitation Programs under
      Title 14 NYCRR § 822.9.

     

    D)
      Outpatient Chemical Dependence for Youth Programs

     

    Outpatient
      Chemical Dependence for Youth Programs (OCDY) licensed under Title 14 NYCRR
      Part
      823, establish programs and service regulations for OCDY programs. OCDY programs
      offer discrete, ambulatory clinic services to chemically-dependent youth in
      a
      treatment setting that supports abstinence from chemical dependence (including
      alcohol and substance abuse) services.

     

    ii)
      Chemical Dependence Services Ordered by the LDSS

     

    A)
      The
      Contractor is not responsible for the provision and payment of Chemical
      Dependence Inpatient Rehabilitation and Treatment Services ordered by the LDSS
      and provided to Enrollees who have:

     

    I)
      been
      assessed as unable to work by the LDSS and are mandated to receive Chemical
      Dependence Inpatient Rehabilitation and Treatment Services as a condition of
      eligibility for Public Assistance or Medicaid, or

     

    II)
      have
      been determined to be able to work with limitations (work limited) and are
      simultaneously mandated by the LDSS into Chemical Dependence Inpatient
      Rehabilitation and Treatment Services (including alcohol and substance abuse
      treatment services) pursuant to work activity requirements.

     

    B)
      The
      Contractor is not responsible for the provision and payment of Medically
      Supervised Inpatient and Outpatient Withdrawal Services ordered by the LDSS
      under Welfare Reform (as indicated by Code 83).

     

    C)
      The
      Contractor is responsible for the provision and payment of Medically Managed
      Detoxification Services in this Agreement.

     

    D)
      If the
      Contractor is already providing an Enrollee with Chemical Dependence Inpatient
      Rehabilitation and Treatment Services and Detoxification Services and the LDSS
      is satisfied with the level of care and services, then the Contractor will
      continue to be responsible for the provision and payment of these
      services.

     

     

    

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    b)
      Mental
      Health Services

     

    i)
      Intensive Psychiatric Rehabilitation Treatment Programs (IPRT)

     

    Time
      limited, active psychiatric rehabilitation designed to assist a patient in
      forming and achieving mutually agreed upon goals in living, learning, working
      and social environments, to intervene with psychiatric rehabilitative
      technologies to overcome functional disabilities. IPRT services are certified
      by
      OMH under 14NYCRRPart587.

     

    ii)
      Day
      Treatment

     

    A
      combination of diagnostic, treatment, and rehabilitative procedures which,
      through supervised and planned activities and extensive client-staff
      interaction, provides the services of the clinic treatment program, as well
      as
      social training, task and skill training and socialization activities. Services
      are expected to be of six (6) months-duration. These services are certified
      by
      OMH under 14 NYCRR Part 587.

     

    iii)
      Continuing Day Treatment

     

    Provides
      treatment designed to maintain or enhance current levels of functioning and
      skills, maintain community living, and develop self-awareness and self-esteem.
      Includes: assessment and treatment planning; discharge planning; medication
      therapy; medication education; case management; health screening and referral;
      rehabilitative readiness development; psychiatric rehabilitative readiness
      determination and referral; and symptom management. These services are certified
      by OMH under 14 NYCRR Part 587.

     

    iv)
      Day
      Treatment Programs Serving Children

     

    Day
      treatment programs are characterized by a blend of mental health and special
      education services provided in a fully integrated program. Typically these
      programs include: special education in small classes with an emphasis on
      individualized instruction, individual and group counseling, family services
      such as family counseling, support and education, crisis intervention,
      interpersonal skill development, behavior modification, art and music
      therapy.

     

    v)
      Home
      and Community Based Services Waiver for Seriously Emotionally Disturbed
      Children

     

    This
      waiver is in select counties for children and adolescents who would otherwise
      be
      admitted to an institutional setting if waiver services were not provided.
      The
      services include individualized care coordination, respite, family support,
      intensive in-home skill building, and crisis response.

    

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    vi)
      Case
      Management

     

    The
      target population consists of individuals who are seriously and persistently
      mentally ill (SPMI), require intensive, personal and proactive intervention
      to
      help them obtain those services which will permit functioning in the community
      and either have symptomology which is difficult to treat in the existing mental
      health care system or are unwilling or unable to adapt to the existing mental
      health care system. Three case management models are currently operated pursuant
      to an agreement with OMH or a local governmental unit, and receive Medicaid
      reimbursement pursuant to 14 NYCRR Part 506. Please note: See generic definition
      of Comprehensive Medicaid Case Management (CMCM) under Item 3 - "Other
      Non-Covered Services."

     

    vii)
      Partial Hospitalization

     

    Provides
      active treatment designed to stabilize and ameliorate acute systems, serves
      as
      an alternative to inpatient hospitalization, or reduces the length of a hospital
      stay within a medically supervised program by providing the
      following:

    assessment
      and treatment planning; health screening and referral; symptom management;
      medication therapy; medication education; verbal therapy; case management;
      psychiatric rehabilitative readiness determination and referral and crisis
      intervention. These services are certified by OMH under NYCRR Part
      587.

     

    viii)
      Services Provided Through OMH Designated' Clinics for Children With A Diagnosis
      of Serious Emotional Disturbance (SED)

     

    These
      are
      services provided by designated OMH clinics to children and adolescents with
      a
      clinical diagnosis of SED.

     

    ix)
      Assertive Community Treatment (ACT)

     

    ACT
      is a
      mobile team-based approach to delivering comprehensive and flexible treatment,
      rehabilitation, case management and support services to individuals in their
      natural living setting. ACT programs deliver integrated services to recipients
      and adjust services over time to meet the recipient's goals and changing
      needs;

    are
      operated pursuant to approval or certification by OMH; and receive Medicaid
      reimbursement pursuant to 14 NYCRR Part 508.

     

    x)
      Personalized Recovery Oriented Services (PROS)

     

    PROS,
      licensed and reimbursed pursuant to 14 NYCRR Part 512, are designed to assist
      individuals in recovery from the disabling effects of mental illness through
      the
      coordinated delivery of a customized array of rehabilitation, treatment, and
      support services in traditional settings and in off-site locations. Specific
      components of PROS include Community Rehabilitation and Support. Intensive
      Rehabilitation, Ongoing Rehabilitation and Support and Clinical
      Treatment.

    

    

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    xi)
      Risperdal Consta, an injectable mental health drug used for management of
      patients with schizophrenia, furnished as part of a clinic or office
      visit.

     

    c)
      Rehabilitation Services Provided to Residents of OMH Licensed Community
      Residences (CRs) and Family Based Treatment Programs, as follows:

     

    i)
      OMH
      Licensed CRs*

     

    Rehabilitative
      services in community residences are interventions, therapies and activities
      which are medically therapeutic and remedial in nature, and are medically
      necessary for the maximum reduction of functional and adaptive behavior defects
      associated with the person's mental illness.

     

    ii)
      Family-Based Treatment*

     

    Rehabilitative
      services in family-based treatment programs are intended to provide treatment
      to
      seriously emotionally disturbed children and youth to promote their successful
      functioning and integration into the natural family, community, school or
      independent living situations. Such services are provided in consideration
      of a
      child's developmental stage. Those children determined eligible for admission
      are placed in surrogate family homes for care and treatment.

     

    *
      These
      services are certified by OMH under 14 NYCRR § 586.3 and Parts 594 and
      595.

     

    d)
      Office
      of Mental Retardation and Developmental Disabilities (OMRDD)
      Services

     

    i)
      Long
      Term Therapy Services Provided by Article 16-Clinic Treatment Facilities or
      Article 28 Facilities

     

    These
      services are provided to persons with developmental disabilities including
      medical or remedial services recommended by a physician or other licensed
      practitioner of the healing arts for a maximum reduction of the effects of
      physical or mental disability and restoration of the person to his or her best
      possible functional level. It also includes the fitting, training, and
      modification of assistive devices by licensed practitioners or trained others
      under their direct supervision. Such services are designed to ameliorate or
      limit the disabling condition and to allow the person to remain in or move
      to.
      the least restrictive residential and/or day setting. These services are
      certified by OMRDD under 14 NYCRR Part 679 (or they are provided by Article
      28
      Diagnostic and Treatment Centers that are explicitly designated by the SDOH
      as
      serving primarily persons with developmental disabilities). If care of this
      nature is provided in facilities other than Article 28 or Article 16 centers,
      it
      is a covered service.

     

    ii)
      Day
      Treatment

     

    

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    A
      planned
      combination of diagnostic, treatment and rehabilitation services provided to
      developmentally disabled individuals in need of a broad range of services,
      but
      who do not need intensive twenty-four (24) hour care and medical supervision.
      The services provided as identified in the comprehensive assessment may include
      nutrition, recreation, self-care, independent living, therapies, nursing, and
      transportation services. These services are generally provided in an ICF or
      a
      comparable setting. These services are certified by OMRDD under 14 NYCRR Pail
      690.

     

    iii)
      Medicaid Service Coordination (MSC)

     

    Medicaid
      Service Coordination (MSC) is a Medicaid State Plan service provided by OMRDD
      which assists persons with developmental disabilities and mental retardation
      to
      gain access to necessary services and supports appropriate to the needs of
      the
      needs of the individual. MSC is provided by qualified service coordinators
      and
      uses a person centered planning process in developing, implementing and
      maintaining an Individualized Service Plan (ISP) with and for a person with
      developmental disabilities and mental retardation. MSC promotes the concepts
      of
      a choice, individualized services and consumer satisfaction. MSC is provided
      by
      authorized vendors who have a contract with OMRDD, and who are paid monthly
      pursuant to such contract. Persons who receive MSC must not permanently reside
      in an ICF for persons with developmental disabilities, a developmental center,
      a
      skilled nursing facility or any other hospital or Medical Assistance
      institutional setting that provides service coordination. They must also not
      concurrently be enrolled in any other comprehensive Medicaid long term service
      coordination program/service including the Care at Home Waiver. Please note:
      See
      generic definition of Comprehensive Medicaid Case Management (CMCM) under Item
      3
      "Other Non-Covered Services."

     

    iv)
      Home
      And Community Based Services Waivers (HCBS)

     

    The
      Home
      and Community-Based Services Waiver serves persons with developmental
      disabilities who would otherwise be admitted to an ICF/MR if waiver services
      were not provided. HCBS waivers services include residential habilitation,
      day
      habilitation, prevocational, supported work, respite, adaptive devices,
      consolidated supports and services, environmental modifications, family
      education and training, live-in caregiver. and plan of care support services.
      \
      These services are authorized pursuant to a SSA § 1915(c) waiver from
      DHHS.

     

    v)
      Services Provided Through the Care At Home Program (OMRDD)

     

    The
      OMRDD
      Care at Home III, Care at Home IV, and Care at Home VI waivers, serve children
      who would otherwise not be eligible for Medicaid because of their parents'
      income and resources, and who would otherwise be eligible for an ICF/MR level
      of
      care. Care at Home waiver services include service coordination, respite and
      assistive technologies. Care at Home waiver services are authorized pursuant
      to
      a SSA § 1915(c) waiver from DHHS.

     

    

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    3.
      Other Non-Covered Services

     

    a)
      The
      Early Intervention Program (EIP) - Children Birth to Two (2) Years of
      Age

     

    i)
      This
      program provides early intervention services to certain children, from birth
      through two (2) years of age, who have a developmental delay or a diagnosed
      physical or mental condition that has a high probability of resulting in
      developmental delay. All managed care providers
      must
      refer
      infants and toddlers suspected of having a delay to the local designated Early
      Intervention agency in their area. (In most municipalities, the County Health
      Department is the designated agency, except: New York City - the Department
      of
      Health and Mental Hygiene; Erie County - The Department of Youth Services;
      Jefferson County -the Office of Community Services; and Ulster County - the
      Department of Social Services).

     

    ii)
      Early
      intervention services provided to this eligible population are categorized
      as
      Non-Covered. These services, which are designed to meet the developmental needs
      of the child and the needs of the family related to enhancing the child's
      development, will be identified on eMedNY by unique rate codes by which only
      the
      designated early intervention agency can claim reimbursement. Contractor covered
      and authorized services will continue to be provided by the Contractor.
      Consequently, the Contractor, through its Participating Providers, will be
      expected to refer any enrolled child suspected of having a developmental delay
      to the locally designated early intervention agency in their area and
      participate in the development of the Child's Individualized Family Services
      Plan (IFSP). Contractor's participation in the development of the IFSP is
      necessary in order to coordinate the provision of early intervention services
      and services covered by the Contractor.

     

    iii)
      SDOH
      will instruct the locally designated early intervention agencies on how to
      identify an Enrollee and the need to contact the Contractor or the Participating
      Provider to coordinate service provision.

     

    b)
      Preschool Supportive Health Services-Children Three (3) Through Four (4) Years
      of Age

     

    i)
      The
      Preschool Supportive Health Services Program (PSHSP) enables counties and New
      York City to obtain Medicaid reimbursement for certain educationally related
      medical services provided by approved preschool special education programs
      for
      young children with disabilities. The Committee on Preschool Special Education
      in each school district is responsible for the development of an Individualized
      Education Program (IEP) for each child evaluated in need of special education
      and medically related health services.

     

    ii)
      PSHSP
      services rendered to children three (3) through four (4) years of age in
      conjunction with an approved IEP are categorized as Non-Covered.

    

    

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    iii)
      The
      PSHSP services will be identified on eMedNY by unique rate codes through which
      only counties and New York City can claim reimbursement. In addition, a limited
      number of Article 28 clinics associated with approved pre-school programs are
      allowed to directly bill Medicaid fee-for-service for these services. Contractor
      covered and authorized services will continue to be provided by the
      Contractor.

     

    c)
      School
      Supportive Health Services-Children Five (5) Through Twenty-One (21) Years
      of
      Age

     

    i)
      The
      School Supportive Health Services Program (SSHSP) enables school districts
      to
      obtain Medicaid reimbursement for certain educationally related medical services
      provided by approved special education programs for children with disabilities.
      The Committee on Special Education in each school district is responsible for
      the development of an Individualized Education Program (IEP) for each child
      evaluated in need of special education and medically related
      services.

     

    ii)
      SSHSP
      services rendered to children five (5) through twenty-one (21) years of age
      in
      conjunction with an approved IEP are categorized as Non-Covered.

     

    iii)
      The
      SSHSP services are identified on eMedNY by unique rate codes through which
      only
      school districts can claim Medicaid reimbursement. Contractor covered and
      authorized services will continue to be provided by the Contractor.

     

    d)
      Comprehensive Medicaid Case Management (CMCM)

     

    A
      program
      which provides "social work" case management referral services to a targeted
      population (e.g.: pregnant teens, mentally ill). A CMCM case manager will assist
      a client in accessing necessary services in accordance with goals contained
      in a
      written case management plan. CMCM programs do not provide services directly,
      but refer to a wide range of service Providers. Some of these services are:
      medical, social, psycho-social, education, employment, financial, and mental
      health. CMCM referral to community service agencies and/or medical providers
      requires the case manager to work out a mutually agreeable case coordination
      approach with the agency/medical providers. Consequently, if an Enrollee of
      the
      Contractor is participating in a CMCM program, the Contractor must work
      collaboratively with the CMCM case manager to coordinate the provision of
      services covered by the Contractor. CMCM programs will be instructed on how
      to
      identify a managed care Enrollee and informed on the need to contact the
      Contractor to coordinate service provision.

    

    e)
      Directly Observed Therapy for Tuberculosis Disease

     

    Tuberculosis
      directly observed therapy (TB/DOT) is the direct observation of oral ingestion
      of TB medications to assure patient compliance with the physician's prescribed
      medication regimen. While the clinical management of tuberculosis is included
      in
      the Benefit Package, TB/DOT where applicable, can be billed directly to eMedNY
      by any SDOH approved Medicaid fee-for-service TB/DOT Provider. The

    

    

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    Contractor
      remains responsible for communicating, cooperating and coordinating clinical
      management of TB with the TB/DOT Provider.

     

    f)
      AIDS
      Adult Day Health Care

     

    Adult
      Day
      Health Care Programs (ADHCP) are programs designed to assist individuals with
      HIV disease to live more independently in the community or eliminate the need
      for residential health care services. Registrants in ADHCP require a greater
      range of comprehensive health care services than can be provided in any single
      setting, but do not require the level of services provided in a residential
      health care setting. Regulations require that a person enrolled in an ADHCP
      must
      require at least three (3) hours of health care delivered on the basis of at
      least one (1) visit per week. While health care services are broadly defined
      in
      this setting to include general medical care, nursing care, medication
      management, nutritional services, rehabilitative services, and substance abuse
      and mental health services, the latter two (2) cannot be the sole reason for
      admission to the program. Admission criteria must include, at a minimum, the
      need for general medical care and nursing services.

     

    g)
      HIV
      COBRA Case Management

     

    The
      HIV
      COBRA (Community Follow-up Program) Case Management Program is a program that
      provides intensive, family-centered case management and community follow-up
      activities by case managers, case management technicians, and community
      follow-up workers. Reimbursement is through an hourly rate billable to
      Medicaid.

    Reimbursable
      activities include intake, assessment, reassessment, service plan development
      and implementation, monitoring, advocacy, crisis intervention, exit planning,
      and case specific supervisory case-review conferencing.

     

    h)
      Adult
      Day Health Care

     

    i)
      Adult
      Day Health Care means care and services provided to a registrant in a
      residential health care facility or approved extension site under the medical
      direction of a physician and which is provided by personnel of the adult day
      health care program in accordance with a comprehensive assessment of care needs
      and individualized health care plan, ongoing implementation and coordination
      of
      the health care plan, and transportation.

    

    ii)
      Registrant means a person who is a nonresident of the residential health care
      facility who is functionally impaired and not homebound and who requires certain
      preventive, diagnostic, therapeutic, rehabilitative or palliative items or
      services provided by a general hospital, or residential health care facility;
      and whose assessed social and health care needs, in the professional judgment
      of
      the physician of record, nursing staff. Social Services and other professional
      personnel of the adult day health care program can be met in whole or in part
      satisfactorily by delivery of appropriate services in such program.

    

    

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    i)
      Persona] Emergency Response Services (PERS)

     

    Personal
      Emergency Response Services (PERS) are not included in the Benefit Package.
      PERS
      are covered on a fee-for-service basis through contracts between the -LDSS
      and
      PERS vendors.

     

    j)
      School-Based Health Centers

     

    A
      School-Based Health Center (SBHC) is an Article 28 extension clinic that is
      located in a school and provides students with primary and preventive physical
      and mental health care services, acute or first contact care, chronic care,
      and
      referral as needed. SBHC services include comprehensive physical and mental
      health histories and assessments, diagnosis and treatment of acute and chronic
      illnesses, screenings (e.g., vision, hearing, dental, nutrition, TB), routine
      management of chronic diseases (e.g., asthma, diabetes), health education,
      mental health counseling and/or referral, immunizations and physicals for
      working papers and sports.

    

    APPENDIX
      K

    January
      1, 2007

    K-35

     

     

    K.4

     

    Family
      Health Plus Non-Covered Services

     

    1. Non-Emergent
      Transportation Services (except for 19 and 20 year olds receiving C/THP
Services)

    2. Personal
      Care Agency Services

    3. Private
      Duty Nursing Services

    4. Long
      Term
      Care - Residential Health Care Facility Services

    5. Non-Prescription
      (OTC) Drugs and Medical Supplies

    6. Alcohol
      and Substance Abuse (ASA) Services Ordered by the LDSS

    7. Office
      of
      Mental Health/ Office of Mental Retardation and Developmental Disabilities
      Services

    8. School
      Supportive Health Services

    9. Comprehensive
      Medicaid Case Management (CMCM)

    10. Directly
      Observed Therapy for Tuberculosis Disease

    11. AIDS
      Adult Day Health Care

    12. HIV
      COBRA
      Case Management

    13. Home
      and
      Community Based Services Waiver

    14. Methadone
      Maintenance Treatment Program

    15. Day
      Treatment

    16. IPRT

    17. Infertility
      Services

    18. Adult
      Day
      Health Care

    19. School
      Based Health Care Services

    20. Personal
      Emergency Response Systems

    

    

    APPENDIX
      K

    January
      1, 2007

    K-36

    

     

    

    Schedule
      1 of Appendix N

    

    

    
      	
              SERVICE

            	
              FEE

            
	
              TB
                CLINIC

            	
              $125.00

            
	
              IMMUNIZATION

            	
              $50.00

            
	
              LEAD
                POISONING SCREENING

            	
              $15.00

            
	
              HIV
                COUNSELING AND TESTING VISIT

            	
              $96.47

            
	
              HIV
                COUNSELING AND NO TESTING

            	
              $90.12

            
	
              HIV
                POST TEST COUNSELING

              Visit
                Positive Result

            	
               

              $90.12

            
	
              LAB
                TEST

            	 
	
              HIV
                1 (ELISA Test)

            	
              $12.27

            
	
              HIV
                Antibody, Confirmatory (Western Blot)

            	
              $26.75

            
	
              DENTAL
                SERVICES

            	
              $108.00EX-10.1

Asset Purchase Agreement

by and among

Luxi Group, LLC,

Odimo Incorporated,

And

Ashford.com, Inc.

1

Dated as of April 6, 2007

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of April 6, 2007,
by and among Luxi Group, LLC, a New York limited liability company (the “Purchaser”), Odimo
Incorporated (“Odimo”), a Delaware corporation, and Ashford.com, Inc., a Delaware corporation and
wholly-owned subsidiary of Odimo, collectively referred to herein together with Odimo as the
“Seller”). Certain capitalized terms used in this Agreement are defined on Appendix 1
hereto.

RECITALS

WHEREAS, Seller was engaged in several businesses, one of which consists of an online jewelry,
diamond jewelry and watch retailing business at www.ashford.com (the “Business”);

WHEREAS, Purchaser desires to purchase from Seller and Seller desires to sell to Purchaser
certain of the assets of, or related to, the Business on the terms and conditions set forth herein;

WHEREAS, concurrent with and as a condition to the execution of this Agreement Purchaser,
Seller and the individuals and entities listed on Exhibit A will enter into confidentiality
and non-competition agreements.

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual representations,
warranties, covenants and promises contained herein, the adequacy and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

AGREEMENT

ARTICLE 1. THE TRANSACTION

1.1 Purchased Assets. Subject to the terms and conditions of this Agreement, at the Closing,
Seller hereby sells, transfers, conveys, assigns and delivers to Purchaser, and Purchaser hereby
purchases from Seller, all of Seller’s right, title and interest in, to and under the assets,
properties, goodwill and rights of Seller used in the conduct of the Business as set forth on
Schedule 1.1 hereto (collectively, the “Purchased Assets”).

1.2 Excluded Assets. Other than as provided in Section 1.1, all other assets of Seller (the
“Excluded Assets”) shall not be included in the Purchased Assets. The Excluded Assets shall
include:

(a) Cash. Cash, cash equivalents, merchant deposits in transit, deposits with credit
card companies and marketable securities;

(b) Accounts Receivable. Accounts receivable associated with sales and transactions
entered into prior to the Closing Date.

(c) All Debt. Any intercompany or intracompany receivable cash balances between
Seller and any of its Affiliates or between any of its Affiliates;

(d) Corporate Documents. Corporate seals, certificates of incorporation, minute
books, stock transfer records, or other records related to the corporate organization of Seller;

(e) Insurance Policies. All insurance policies;

(f) Claims. All claims, choses-in-action, rights in action, rights to tender claims
or demands to Seller’s insurance companies, rights to any insurance proceeds, and other similar
claims; and

(g) Rights Under Certain Agreements. All rights under a Transaction Agreement.

1.3 Assumed Liabilities. Purchaser agrees that at the Closing, Purchaser shall assume those
Liabilities of the Seller listed on Schedule 1.3 hereto (collectively, the “Assumed
Liabilities”).

1.4 Retained Liabilities. Other than the Assumed Liabilities, Purchaser shall not assume and
shall not be liable or responsible for any Liability of Seller, any direct or indirect subsidiary
of Seller (each, a “Subsidiary”) or any Affiliate of Seller (collectively, the “Retained
Liabilities”) whether arising before or after the Closing Date. Without limiting the foregoing, the
Retained Liabilities shall include, and Purchaser shall not be obligated to assume, and does not
assume, and hereby disclaims any of the following Liabilities of Seller, its Subsidiaries or its
Affiliates:

(a) Any Liability attributable to any assets, properties or Contracts that are not included
in the Purchased Assets;

(b) Any Liability for breaches of any Contract included in the Purchased Assets on or prior
to the Closing Date or any Liability for payments or amounts due under any such Contract on or
prior to the Closing Date;

(c) Any Liability to GSI Commerce, Inc. under the Asset Purchase Agreement by and between
Seller and Ashford.com, Inc. dated December 6, 2002;

(d) Any Liability for Taxes attributable to or imposed upon Seller or its Affiliates for any
period, or attributable to or imposed upon the Purchased Assets on or prior to the Closing Date,
including any Transfer Taxes;

(e) Any Liability for or with respect to any loan, other indebtedness, or account payable,
including any such Liabilities owed to Affiliates of Seller;

(f) Any Liability arising from accidents, occurrences, misconduct, negligence, breach of
fiduciary duty or statements made or omitted to be made (including libelous or defamatory
statements) on or prior to the Closing Date, whether or not covered by workers’ compensation or
other forms of insurance;

(g) Any Liability arising as a result of any legal or equitable action or judicial or
administrative proceeding initiated at any time, to the extent related to any action or omission
on or prior to the Closing Date, including any Liability for (i) infringement or misappropriation
of any Intellectual Property Rights or any other rights of any Person (including any right of
privacy or publicity); or (ii) violations of any Legal Requirements (including federal and state
securities laws);

(h) Any Liability incurred in connection with the making or performance of this Agreement and
the Transaction;

(i) Any Liability incurred in connection with a violation of or arising under Environmental
Laws or any other Legal Requirement;

(j) Any Liability for expenses and fees incurred by Seller incidental to the preparation of
the Transaction Agreements, preparation or delivery of materials or information requested by
Purchaser, and the consummation of the Transaction, including all broker, counsel and accounting
fees and Transfer Taxes;

(k) Any Liability arising out of transactions, commitments, infringements, acts or omissions
not in the ordinary course of business;

(l) Any Liability arising out of any Seller Benefit Plan or contract of insurance for
employee group medical, dental or life insurance plans;

(m) Any Liability for making payments of any kind to employees and independent contractors
(including as a result of the Transaction, the termination of an employee by Seller, or other
claims arising out of the terms of employment with Seller) or with respect to payroll taxes;

(n) Any Legal Requirement applicable to Seller, the Purchased Assets or the Retained
Liabilities on or prior to the Closing Date or any Liability for a violation of such a Legal
Requirement;

(o) Any Liability to any stockholders of Seller;

(p) Any Liability for credit balances, credit memos and all other amounts due to dealers,
distributors and customers;

(q) Any Liability related to or arising from the acquisition of the Business by Seller;

(r) Any Liability associated with the Federal CAN-SPAM Act or violations of Seller’s privacy
policies associated with collection, retention, use, transfer or sale of customer information; or

(s) Any costs or expenses incurred in connection with shutting down, deinstalling and
removing equipment not purchased by Purchaser.

ARTICLE 2. CONSIDERATION FOR TRANSFER

2.1 Purchase Price and Payment. Subject to the terms of this Agreement, as full consideration
for the sale, assignment, transfer and delivery of the Purchased Assets and the execution and
delivery of the Transaction Agreements by Seller to Purchaser, Purchaser is paying an aggregate
purchase price of $400,000 (the “Purchased Assets Purchase Price”), which price includes the
payment by Purchaser to Seller on March 23, 2007 of a deposit in the amount of $100,000 (the
“Deposit Amount”), payable by wire transfer of immediately available U.S. funds to Seller of
$300,000.

2.2 Allocation of Purchase Price. As soon as practicable after the Closing, Purchaser and
Seller shall agree to the allocation of the Purchase Price, as adjusted pursuant to
Section 2.1, among the various classes of Purchased Assets (as such classes are defined for
the purposes of Section 1060 of the Code). All allocations made pursuant to this
Section 2.2 shall be made in accordance with the requirements of Section 1060 of the Code.
None of the parties shall take a position on any Tax Return (including IRS Form 8594), before any
Tax Authority or in any judicial proceeding that is in any manner inconsistent with such allocation
without the written consent of the other parties to this Agreement or unless specifically required
pursuant to a determination by an applicable Tax Authority. The parties shall promptly advise each
other of the existence of any tax audit, controversy or litigation related to any allocation
hereunder.

ARTICLE 3. CLOSING AND CLOSING DELIVERIES

3.1 Closing; Time and Place. The closing of the purchase and sale provided for in this
Agreement (the “Closing”) shall occur at the offices of Fish & Richardson P.C., Citigroup Center,
52nd Floor, 153 East 53rd Street, New York, New York 10022-4611, at 2:00 P.M.
(the “Closing Time”) on the date of execution of this Agreement or at such other time or by such
other manner, including, but not limited to, the execution of this Agreement and all accompanying
documentation via facsimile, agreed to by the parties hereto (the “Closing Date”).

3.2 Deliveries by Seller. On the date hereof, Seller is (i) taking all reasonable steps
necessary to place Purchaser in actual possession and operating control of the Business and the
Purchased Assets and (ii) delivering the following items, duly executed by Seller as applicable,
all of which shall be in a form and substance reasonably acceptable to Purchaser and Purchaser’s
counsel:

(a) General Assignment and Bill of Sale. General Assignment and Bill of Sale covering
all of the applicable Purchased Assets, substantially in the form attached hereto as
Exhibit 3.2(a) (the “General Assignment and Bill of Sale”);

(b) Intellectual Property Assignment. Any and all documents necessary to properly
record the assignment to Purchaser of all of Seller’s right, title and interest in and to the
Seller Intellectual Property Rights, including the intellectual property assignment (the
“Intellectual Property Assignment”) substantially in the form of Exhibit 3.2(b) attached
hereto;

(c) Other Conveyance Instruments. Such other specific instruments of sale, transfer,
conveyance and assignment as Purchaser may request;

(d) FIRPTA. A FIRPTA Notification Letter, substantially in the form attached hereto
as Exhibit 3.2(d) (the “FIRPTA Notification Letter”);

(e) Request for Reconveyance of Deed of Trust; Payoff and Release Letters. Payoff and
release letters from creditors of Seller, together with UCC-3 termination statements with respect
to any financing statements filed against the Business or any of the Purchased Assets, terminating
all Encumbrances (including Tax liens) on any of the Purchased Assets;

(f) Support Agreements. Support Agreements covering at least 50% of the outstanding
 shares of capital stock of Seller, in substantially the form attached as Exhibit 3.2(f)
(the “Support Agreements”).

(g) Officer’s Certificate. A Certificate executed on behalf of Seller by its Chief
Executive Officer (the “Officer’s Certificate”), certifying that (i) all of the representations
and warranties of Purchaser in this Agreement are true and correct in all material respects
(considered collectively and individually) as of the date of this Agreement (or, to the extent
such representations and warranties speak as of an earlier date, they shall be true and correct in
all material respects as of such earlier date) and (ii) all of the representations and warranties
of Seller in this Agreement that contain an express materiality qualification shall have been true
and correct in all respects (considered collectively and individually) as of the date of this
Agreement;

(h) Secretary’s Certificate. A certificate of the Secretary of the Seller (the
“Secretary’s Certificate”) setting forth a copy of the resolutions adopted by the Board of
Directors of Seller authorizing and approving the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby;

(i) Certificates of Good Standing. A certificate from the Secretary of State of each
of Delaware, Florida and each other jurisdiction where the Business is conducted as to Seller’s
good standing and payment of all applicable Taxes;

(j) Consents. All Consents required (i) for the transfer of the Business and the
Purchased Assets; (ii) for the consummation of the Transaction; or (iii) to prevent a breach or
termination of any Material Contract;

(k) Termination of Licenses. To the extent there are any licenses, Contracts or
rights that grant any Subsidiary or Affiliate of the Seller the right to use the Seller
Intellectual Property, such licenses, contracts and rights shall be terminated as of the Closing
Date and Seller shall provide Purchaser executed copied of all termination agreements effecting
such terminations; and

(l) Trademark Settlement. A copy of the proposed settlement agreement with Federated
Department Stores regarding Seller’s use of the trademarks “ashford.com” and related logo in the
form attached hereto as Exhibit 3.2(l) (the “Trademark Settlement Agreement”).

3.3 Deliveries by Purchaser. At the Closing, Purchaser shall cause a wire transfer to the
Seller’s account, in the amount of the Purchase Price less the Deposit Amount.

ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SELLER

Except as specifically set forth on Schedule 4 (the “Seller Disclosure Schedule”)
attached to this Agreement (the parts of which are numbered to correspond to the individual Section
numbers of this Article 4), Seller hereby represents and warrants (without limiting any
other representations or warranties made by Seller in this Agreement or any other Transaction
Agreement) to Purchaser as follows:

4.1 Organization, Good Standing, Qualification. The Seller Disclosure Schedule sets forth
Seller’s jurisdiction of organization and each state or other jurisdiction in which Seller is
qualified to do business. Seller (i) is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; (ii) is duly qualified to conduct
business and is in corporate and tax good standing under the laws of each jurisdiction in which the
nature of its business (including the Business), the operation of its assets (including the
Purchased Assets) or the ownership or leasing of its properties (including the Real Property and
Personal Property) requires such qualification; and (iii) has full power and authority required to
own, lease and operate its assets and to carry on its business (including the Business) as now
being conducted and as presently proposed to be conducted.

4.2 Authority; Binding Nature of Agreements. Seller has all requisite power and authority to
execute and deliver this Agreement and all other Transaction Agreements to which it is a party and
to carry out the provisions of this Agreement and the other Transaction Agreements. The execution,
delivery and performance by Seller of this Agreement and the other Transaction Agreements have been
approved by all requisite action on the part of Seller. This Agreement has been duly and validly
executed and delivered by Seller. Each of this Agreement and the other Transaction Agreements
constitutes, or upon execution and delivery, will constitute, the legal, valid and binding
obligation of Seller, enforceable against Seller in accordance with its terms.

4.3 No Conflicts; Required Consents. The execution, delivery and performance of this Agreement
or any other Transaction Agreement by Seller do not and will not (with or without notice or lapse
of time):

(a) conflict with, violate or result in any breach of (i) any of the provisions of Seller’s
Certificate of Incorporation or bylaws; (ii) any resolutions adopted by the Board of Directors or
stockholders of Seller; (iii) any of the terms or requirements of any Governmental Approval held
by Seller or any of its employees or that otherwise relates to the Business or any of the
Purchased Assets; or (iv) any provision of any Material Contract;

(b) give any Governmental Authority or other Person the right to (i) challenge the
Transaction; (ii) exercise any remedy or obtain any relief under any Legal Requirement or any
Order to which Seller, or any of the Purchased Assets, is subject; (iii) declare a default of,
exercise any remedy under, accelerate the performance of, cancel, terminate, modify or receive any
payment under any Material Contract; or (iv) revoke, suspend or modify any Governmental Approval;

(c) cause Seller or Purchaser to become subject to, or to become liable for the payment of,
any Tax, or cause any of the Purchased Assets to be reassessed or revalued by any Tax Authority or
other Governmental Authority;

(d) result in the imposition or creation of any Encumbrance upon or with respect to any of
the Purchased Assets; or

(e) require Seller to obtain any Consent or make or deliver any filing or notice to a
Governmental Authority or any other Person.

4.4 Subsidiaries. None of the Purchased Assets is owned by any Subsidiary of Seller or any
other Entity and no portion of the Business is conducted by any Subsidiary of Seller or any other
Entity.

4.5 Transactions with Affiliates. No Affiliate (a) owns, directly or indirectly, any debt,
equity or other interest in any Entity with which Seller is affiliated, has a business relationship
or competes other than Affiliates that own less than two percent (2%) of the issued and outstanding
capital stock of a publicly-traded competitor of Seller; (b) is indebted to Seller, nor is Seller
indebted (or committed to make loans or extend or guarantee credit) to any Affiliate other than
with respect to any of Seller’s obligations to pay accrued salaries, reimbursable expenses or other
standard employee benefits; (c) has any direct or indirect interest in any asset (including the
Purchased Assets), property or other right used in the conduct of or otherwise related to the
Business; (d) has any claim or right against Seller, and no event has occurred, and no condition or
circumstance exists, that might (with or without notice or lapse of time) directly or indirectly
give rise to or serve as a basis for any claim or right in favor of any Affiliate against Seller;
and (e) is a party to any Material Contract or has had any direct or indirect interest in, any
Material Contract, transaction or business dealing of any nature involving Seller.

4.6 Material Contracts.

(a) Schedule 4.6 sets forth an accurate, correct and complete list of all Contracts
associated with the Business or the Purchased Assets to which any of the descriptions set forth
below may apply (the “Material Contracts”): (i) Personal Property Leases, Insurance, Contracts
affecting any Seller Intellectual Property or Seller’s information systems or software, Contracts
with employees or contractors, Seller Benefit Plans and Governmental Approvals; (ii) Any Contract
for capital expenditures or for the purchase of goods or services in excess of $5,000; (iii) Any
Contract obligating Seller to sell or deliver any product or service by or through the Business at
a price which does not cover the cost (including labor, materials and production overhead) plus
the customary profit margin associated with such product or service; (iv) Any Contract involving
financing or borrowing of money, or evidencing indebtedness, any liability for borrowed money, any
obligation for the deferred purchase price of property in excess of $5,000 or guaranteeing in any
way any Contract in connection with any Person; (v) Any joint venture, partnership, cooperative
arrangement or any other Contract involving a sharing of profits; (vi) Any advertising or
marketing Contract not terminable without payment or penalty on five (5) days notice; (vii) Any
Contract with respect to the discharge, storage or removal of effluent, waste or pollutants;
(viii) Any Contract affecting any right, title or interest in or to Real Property; (ix) Any
Contract relating to any license or royalty arrangement; (x) Any power of attorney, proxy or
similar instrument; (xi) The Charter, Bylaws and other organizational or constitutive documents of
Seller and any Contract among stockholders of Seller; (xii) Any Contract for the manufacture,
service or maintenance of any product of the Business; (xiii) Any Contract for the purchase or
sale of any assets other than in the ordinary course of business or for the option or preferential
rights to purchase or sell any assets; (xiv) Any requirement or output Contract; (xv) Any Contract
to indemnify any Person or to share in or contribute to the liability of any Person; (xvi) Any
Contract for the purchase or sale of foreign currency or otherwise involving foreign exchange
transactions; (xvii) Any Contract containing covenants not to compete in any line of business or
with any Person in any geographical area;(xviii) Any Contract related to the acquisition of a
business or the equity of any other Entity; (xix) Any other Contract which (i) provides for
payment or performance by either party thereto having an aggregate value of $5,000 or more;
(ii) is not terminable without payment or penalty on five (5) days (or less) notice; or (iii) is
between, inter alia, an Affiliate and Seller; (xx) Any other Contract that involves future
payments, performance of services or delivery of goods or materials to or by Seller of an
aggregate amount or value in excess of $5,000, on an annual basis, or that otherwise is material
to the Business or prospects of Seller; (xxi) Any Contract which is material to the Business; and
(xxii) Any proposed arrangement of a type that, if entered into, would be a Contract described in
any of (i) through (xxi) above.

(b) Seller has delivered to Purchaser accurate, correct and complete copies of all Material
Contracts (or written summaries of the material terms thereof, if not in writing), including all
amendments, supplements, modifications and waivers thereof. All nonmaterial contracts of Seller do
not, in the aggregate, represent a material portion of the Liabilities of Seller.

(c) Each Material Contract is currently valid and in full force and effect, and is
enforceable by Seller in accordance with its terms.

(d) (i) Seller is not in default, and no party has notified Seller that it is in default,
under any Contract. No event has occurred, and no circumstance or condition exists, that might
(with or without notice or lapse of time) (x) result in a violation or breach of any of the
provisions of any Material Contract; (y) give any Person the right to declare a default or
exercise any remedy under any Material Contract; or (z) give any Person the right to accelerate
the maturity or performance of any Material Contract or to cancel, terminate or modify any
Material Contract or otherwise have a Material Adverse Effect on Seller in connection with any
Material Contract; and (ii) Seller has not waived any of its rights under any Material Contract.

(e) Each Person against which Seller has or may acquire any rights under any Material
Contract is (i) Solvent and (ii) able to satisfy such Person’s material obligations and
liabilities to Seller.

(f)  The Material Contracts constitute all of the Contracts necessary to enable Seller to
conduct the Business in the manner in which such Business is currently being conducted and in the
manner in which such Business is proposed to be conducted.

4.7 Title; Sufficiency. Seller has good and marketable title to, is the exclusive legal and
equitable owner of, and has the unrestricted power and right to sell, assign and deliver the
Purchased Assets, including the goodwill of the ongoing and existing business symbolized by the
Purchased Assets or pertinent thereto, including all rights in any applications or issued
registrations thereof and including the right to sue for past, present and future infringement
thereof. The Purchased Assets are free and clear of all Encumbrances of any kind or nature, except
(a) restrictions imposed in any Governmental Approval and (b) Encumbrances disclosed on
Schedule 4.7 which are being removed and released concurrently with the Closing on the date
hereof. Upon Closing, Purchaser will acquire exclusive, good and marketable title or license to (as
the case may be) the Purchased Assets and no restrictions will exist on Purchaser’s right to
resell, license or sublicense any of the Purchased Assets or engage in the Business.

4.8 Intellectual Property.

(a) Schedule 4.8 lists all Seller Intellectual Property, specifying in each case
whether such Seller Intellectual Property is owned or controlled by or for, licensed to, or
otherwise held by or for the benefit of Seller, including all Registered Intellectual Property
Rights owned by, filed in the name of or applied for by Seller and used in the Business (the
“Seller Registered Intellectual Property Rights”).

(b) Each item of Seller Intellectual Property (i) is valid, subsisting and in full force and
effect, (ii) has not been abandoned or passed into the public domain and (iii) is free and clear
of any Encumbrances.

(c) The Seller Intellectual Property constitutes all the Intellectual Property Rights used in
and/or necessary to the conduct of the Business as it is currently conducted, and as it is
currently planned or contemplated to be conducted by Seller prior to the Closing and by Purchaser
following the Closing.

(d) Each item of Seller Intellectual Property either (i) is exclusively owned by Seller and
was written and created solely by employees of Seller acting within the scope of their employment
or by third parties, all of which employees and third parties as works made for hire, have, except
as provided in the U.S. Copyright Act, validly and irrevocably assigned all of their rights,
including Intellectual Property Rights therein, to Seller, and no third party owns or has any
rights to any such Seller Intellectual Property, or (ii) is duly and validly licensed to Seller
for use in the manner currently used by Seller in the conduct of the Business and, as it is
currently planned or contemplated to be used by Seller in the conduct of the Business prior to the
Closing and by Purchaser following the Closing.

(e) In each case in which Seller has acquired any Intellectual Property Rights from any
Person, Seller has obtained, except as provided in the U.S. Copyright Act, a valid and enforceable
assignment sufficient to irrevocably transfer all rights in such Intellectual Property Rights
(including the right to seek past and future damages and equitable relief with respect thereto) to
Seller. No Person who has licensed Intellectual Property Rights to Seller has ownership rights or
license rights to improvements made by Seller in such Intellectual Property Rights. Seller has not
transferred ownership of, or granted any exclusive license of or right to use, or authorized the
retention of any exclusive rights to use or joint ownership of, any Intellectual Property Rights
that is or was Seller Intellectual Property to any Person.

(f) There are no facts, circumstances or information that (i) would render any Seller
Intellectual Property invalid or unenforceable, (ii) would adversely affect any pending
application for any Seller Registered Intellectual Property Right, or (iii) would adversely affect
or impede the ability of Seller to use any Seller Intellectual Property in the conduct of the
Business as it is currently conducted or as it is currently planned or contemplated to be
conducted by Seller prior to Closing or by Purchaser following the Closing. Seller has not
misrepresented, or failed to disclose, and has no Knowledge of any misrepresentation or failure to
disclose, any fact or circumstances in any application for any Seller Registered Intellectual
Property Right that would constitute fraud or a misrepresentation with respect to such application
or that would otherwise affect the validity or enforceability of any Seller Registered
Intellectual Property Right.

(g) All necessary registration, maintenance and renewal fees in connection with each item of
Seller Registered Intellectual Property Rights have been paid and all necessary documents and
certificates in connection with such Seller Registered Intellectual Property Rights have been
filed with the relevant patent, copyright, trademark, domain name registries or other authorities
in the United States or foreign jurisdictions, as the case may be, for the purposes of maintaining
such Seller Registered Intellectual Property Rights. There are no actions that must be taken by
Seller within one hundred twenty (120) days following the Closing Date, including the payment of
any registration, maintenance or renewal fees or the filing of any responses to office actions,
documents, applications or certificates for the purposes of obtaining, maintaining, perfecting,
preserving or renewing any Registered Intellectual Property Rights. To the maximum extent provided
for by, and in accordance with, applicable laws and regulations or registration requirements,
Seller has recorded in a timely manner each such assignment of a Registered Intellectual Property
Right assigned to Seller with the relevant governmental authority and domain name registries,
including without limitation the United States Patent and Trademark Office (the “PTO”), the U.S.
Copyright Office or their respective counterparts in any relevant foreign jurisdiction, as the
case may be.

(h) Seller has taken all necessary action to maintain and protect (i) the Seller Intellectual
Property, and (ii) the secrecy, confidentiality, value and Seller’s rights in the Confidential
Information and Trade Secrets of Seller and those provided by any Person to Seller, including by
having and enforcing a policy requiring all current and former employees, consultants and
contractors of Seller to execute appropriate confidentiality and assignment agreements. All copies
thereof shall be delivered to Purchaser at Closing. Seller has no Knowledge of any violation or
unauthorized disclosure of any Trade Secret or Confidential Information related to the Business,
the Purchased Assets, or obligations of confidentiality with respect to such. Only the individuals
named in the Seller Disclosure Schedule, which describes their relationship with Seller, have had
access to such Trade Secrets and Confidential Information, and each such individual has signed a
confidentiality agreement with respect thereto.

(i) The operation of the Business as it is currently conducted, or as it is currently planned
or contemplated to be conducted by Seller prior to the Closing, does not and will not, and will
not when operated by Purchaser substantially in the same manner following the Closing, infringe or
misappropriate any Intellectual Property Rights of any Person, violate any right of any Person
(including any right to privacy or publicity), defame or libel any Person or constitute unfair
competition or trade practices under the laws of any jurisdiction, and Seller has not received
notice from any Person claiming that such operation infringes or misappropriates any Intellectual
Property Rights of any Person (including any right of privacy or publicity), or defames or libels
any Person or constitutes unfair competition or trade practices under the laws of any jurisdiction
(nor does Seller have Knowledge of any basis therefor).

(j) To Seller’s Knowledge, no Person is violating, infringing or misappropriating any Seller
Intellectual Property Right.

(k) There are no Proceedings before any Governmental Authority (including before the PTO)
anywhere in the world related to any of the Seller Intellectual Property, including any Seller
Registered Intellectual Property Rights.

(l) No Seller Intellectual Property is subject to any Proceeding or any outstanding decree,
order, judgment, office action or settlement agreement or stipulation that restricts in any manner
the use, transfer or licensing thereof by Seller or that may affect the validity, use or
enforceability of such Seller Intellectual Property.

(m) There is no Material Contract affecting any Seller Intellectual Property under which
there is any dispute regarding the scope of such Material Contract, or performance under such
Material Contract, including with respect to any payments to be made or received by Seller
thereunder.

(n) All Seller Intellectual Property will be fully transferable, alienable or licensable by
Purchaser without restriction and without payment of any kind to any third party. The consummation
of the Transaction as contemplated hereby will not result in any loss of, or the diminishment in
value of, any Seller Intellectual Property or the right to use any Seller Intellectual Property.

(o) Neither this Agreement nor the Transaction will result in (i) Purchaser granting to any
third party any right to, or with respect to, any Intellectual Property Right owned by, or
licensed to, Purchaser; (ii) Purchaser being bound by, or subject to, any non-compete or other
restriction on the operation or scope of its businesses, including the Business; or
(iii) Purchaser being obligated to pay any royalties or other amounts to any third party.

(p) There are no licenses, Contracts or rights that grant any Subsidiary of the Seller the
right to use any Seller Intellectual Property.

4.9 Suppliers and Affiliates. Seller has not entered into any Contract under which Seller
is restricted from selling, licensing or otherwise distributing any of its products to any class
of customers, in any geographic area, during any period of time or in any segment of the market.
There is no purchase commitment which provides that any supplier will be the exclusive supplier of
Seller or distributor. There is no purchase commitment requiring Seller to purchase the entire
output of a supplier.

4.10 Seller Products and Product Warranty. All products manufactured, processed, distributed,
shipped or sold by Seller in the context of operation of the Business and any services rendered by
Seller in the context of operation of the Business have been in conformity with all applicable
contractual commitments and all expressed or implied warranties. The Seller Disclosure Schedule
sets forth an accurate, correct and complete statement of all written warranties, warranty
policies, service and maintenance agreements of the Business. No products heretofore manufactured,
processed, distributed, sold, delivered or leased by Seller in the context of operation of the
Business are now subject to any guarantee, written warranty, claim for product liability, or patent
or other indemnity. All warranties are in conformity with the labeling and other requirements of
the Magnuson-Moss Warranty Act and other applicable laws.

4.11 Employees and Consultants.

(a) Employees and Contracts. No employee of Seller, including but not limited to the
individuals listed on Schedule 4.11 has been granted the right to continued employment by
Seller or to any material compensation following termination of employment with Seller.
Schedule 4.11 lists all employees of Seller, and each such employee’s job title and annual
compensation.

(b) Disputes. There are no claims, disputes or controversies pending or, to the
Knowledge of Seller, threatened involving any employee or group of employees or pertaining to any
Legal Requirement.

(c) WARN Act. Seller is in full compliance with the Worker Readjustment and
Notification Act (the “WARN Act”) (29 USC §2101) and similar applicable state or local laws,
including all obligations to promptly and correctly furnish all notices required to be given
thereunder in connection with any “plant closing” or “mass layoff” to “affected employees”,
“representatives” and any state dislocated worker unit and local government officials. No
reduction in the notification period under the WARN Act is being relied upon by Seller. The Seller
Disclosure Schedule sets forth an accurate, correct and complete list of all employees terminated
(except with cause, by voluntarily departure or by normal retirement), laid off or subjected to a
reduction of more than 50% in hours or work during the two full calendar months and the partial
month preceding this representation and warranty.

4.12 Seller Benefit Plans.

(a) Schedule 4.12(a) identifies each Seller Benefit Plan. Each Seller Benefit Plan has
been maintained in compliance in all material respects with its terms and with the requirements
under applicable law, including but not limited to ERISA and the Code.

(b) None of the Seller Benefit Plans is a (i) a Multiemployer Plan, (ii) a Defined Benefit
Plan, (iii) any plan that is subject to Section 412 of the Code, or (iv) a plan intended to be
qualified under Section  401(a) of the Code; and neither Seller nor any ERISA Affiliate has at any
time within the past six (6) years contributed to, maintained, or incurred any liability with
respect to any such plan.

(c) No Seller Benefit Plan provides benefits, including death or medical benefits (whether or
not insured), with respect to employees or former employees of Seller and its ERISA Affiliates
beyond retirement or other termination of service, other than coverage required by Section 4980B of
the Code and Sections 601 through 608 of ERISA (and, if applicable, comparable state law).

Nothing contained in any of the Seller Benefit Plans will obligate Purchaser to provide any
benefits to employees, former employees or beneficiaries of employees or former employees, or to
make any contributions to any plans from and after the Closing.

4.13 Compliance with Laws.

(a) Seller is, and at all times has been, in compliance in all material respects, with each
Legal Requirement that is applicable to Seller or any of Seller’s properties, assets (including
the Purchased Assets), operations or businesses (including the Business), and no event has
occurred, and no condition or circumstance exists, that might (with or without notice or lapse of
time) constitute, or result directly or indirectly in, a default under, a breach or violation of,
or a failure comply with, any such Legal Requirement. Seller has not received any notice from any
third party regarding any actual, alleged or potential violation of any Legal Requirement.

(b) To Seller’s knowledge, no Governmental Authority has proposed or is considering any Legal
Requirement that may affect Seller, Seller’s properties, assets (including the Purchased Assets),
operations or businesses (including the Business), or Seller’s rights thereto.

4.14 SEC Documents, Financial Statements.

(a)  As of their respective filing dates, each statement, report, registration statement
(with the prospectus in the form filed pursuant to Rule 424(b) of the Securities Act of 1933, as
amended (the “Securities Act”)), definitive proxy statement, and other filings filed with
the SEC by Seller since January 1, 2006 (collectively, the “Seller SEC Documents”)
complied as to form in all material respects with the requirements of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”) and the Securities Act and each of the Seller SEC
Documents was timely filed and did not contain any untrue statement of material fact or omitted to
state a material fact required to be stated therein or necessary to make the statements made
therein, in light of the circumstances in which they were made, not misleading, except to the
extent corrected, supplemented or superseded by a subsequently filed Seller SEC Document. To the
Seller’s knowledge, as of the date hereof, none of the Seller SEC Documents is subject to ongoing
SEC review or outstanding SEC comment.

(b) The financial statements of Seller, including the notes thereto, included in the Seller
SEC Documents (the “Seller Financial Statements”) (i) were complete and correct as of
their respective dates, (ii) complied as to form in all material respects with applicable
accounting requirements and with the published rules and regulations of the SEC with respect
thereto as of their respective dates; (iii) have been prepared in accordance with GAAP applied on
a basis consistent throughout the periods indicated and consistent with each other (except as may
be indicated in the notes thereto or, in the case of unaudited statements, included in Quarterly
Reports on Form 10-Q, as permitted by Form 10-Q of the SEC); and (iv) fairly present the
consolidated financial condition and results of operations of Seller as of the respective dates
and for the respective periods indicated therein (subject, in the case of unaudited statements, to
normal, recurring year-end adjustments). There has been no change in Seller accounting policies
except as described n the notes to the Seller Financial Statements. The Seller does not intend to
correct or restate, and there is not any basis to restate, any of the Seller Financial Statements.

(c) Each of the principal executive officer and the principal financial officer of Seller (or
each former principal executive officer and each former principal financial officer of Seller, as
applicable) has made all certifications required by Rule 13a-14 or 15d-14 under the Exchange Act
or Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (“SOX”) and the rules and
regulations of the SEC promulgated thereunder with respect to the Seller SEC Documents, and the
statements contained in such certifications are true and correct. For purposes of the foregoing
sentence, “principal executive officer” and “principal financial officer” shall have the meanings
given to such terms in SOX. Neither Seller nor any of its Subsidiaries has outstanding, or has
arranged any outstanding, “extensions of credit” to directors or executive officers within the
meaning of Section 402 of SOX.

(d) Neither Seller nor any of its Subsidiaries is a party to, or has any commitment to become
a party to, any joint venture, off-balance sheet partnership or any similar contract or
arrangement (including any contract or arrangement relating to any transaction or relationship
between or among Seller and any of its Subsidiaries, on the one hand, and any unconsolidated
affiliate, including any structured finance, special purpose or limited purpose entity or Person,
on the other hand or any “off-balance sheet arrangements” (as defined in Item 303(a) of Regulation
S-K of the SEC)).

(e) Seller maintains a system of internal accounting controls sufficient to provide
reasonable assurance that: (i) transactions are executed in accordance with management’s general
or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with GAAP and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

(f) Seller has in place the “disclosure controls and procedures” (as defined in Rules
13a-15(e) and 15d-15(e) of the Exchange Act) required in order for the chief executive officer and
chief financial officer of Seller to engage in the review and evaluation process mandated by the
Exchange Act and the rules promulgated thereunder. Seller’s “disclosure controls and procedures”
are reasonably designed to ensure that all information (both financial and non-financial) required
to be disclosed by Seller in the reports that it files or submits under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified in the rules and
forms of the SEC, and that all such information is accumulated and communicated to Seller’s
management as appropriate to allow timely decisions regarding required disclosure and to make the
certifications of the chief executive officer and chief financial officer of Seller required under
the Exchange Act with respect to such reports.

4.15 Governmental Approvals.

(a) Seller has all Governmental Approvals that are necessary or appropriate in connection
with Seller’s ownership and use of its properties or assets (including the Purchased Assets) or
Seller’s operation of its businesses (including the Business). Seller has made all filings with,
and given all notifications to, all Governmental Authorities as required by all applicable Legal
Requirements. Schedule 4.15 contains an accurate, correct and complete list and summary
description of each such Governmental Approval, filing or notification. Each such Governmental
Approval, filing and notification is valid and in full force and effect, and there is not pending
or threatened any Proceeding which could result in the suspension, termination, revocation,
cancellation, limitation or impairment of any such Governmental Approval, filing or notification.
No violations have been recorded in respect of any Governmental Approvals, and Seller knows of no
meritorious basis therefor. No fines or penalties are due and payable in respect of any
Governmental Approval or any violation thereof.

(b) Seller has delivered to Purchaser accurate and complete copies of all of the Governmental
Approvals, filings and notifications identified in Schedule 4.16, including all renewals
thereof and all amendments thereto. All Governmental Approvals are freely assignable to Purchaser.

4.16 Proceedings and Orders.

(a) There is no Proceeding pending or, or to Seller’s Knowledge, threatened against or
affecting Seller, any of Seller’s properties, assets (including the Purchased Assets), operations
or businesses (including the Business), or Seller’s rights relating thereto. To Seller’s
Knowledge, no event has occurred, and no condition or circumstance exists, that might directly or
indirectly give rise to or serve as a basis for the commencement of any such Proceeding. Seller
has delivered to Purchaser true, accurate and complete copies of all pleadings, correspondence and
other documents relating to any such Proceeding. No insurance company has asserted in writing that
any such Proceeding is not covered by the applicable policy related thereto.

(b) Neither Seller, its officers, directors, agents or employees, nor any of Seller’s
properties, assets (including the Purchased Assets), operations or businesses (including the
Business), nor Seller’s rights relating to any of the foregoing, is subject to any Order or any
proposed Order.

4.17 Taxes.

(a) Seller and each of its Subsidiaries has timely filed all Tax Returns (as defined below)
that it was required to file, and such Tax Returns are true, correct and complete. All Taxes (as
defined below) shown to be payable on such Tax Returns or on subsequent assessments with respect
thereto have been paid in full on a timely basis, and no other Taxes are payable by Seller or any
Subsidiary with respect to any period ending prior to the date of this Agreement, whether or not
shown due or reportable on such Tax Returns, other than Taxes for which adequate accruals have been
provided in the Seller Financial Statements. No claim has been made by a Tax Authority in a
jurisdiction where Tax Returns are not filed by or on behalf of the Seller or any of its
Subsidiaries that the Seller or any such Subsidiary is or may be subject to taxation by that
jurisdiction. Seller and each of its Subsidiaries has withheld and paid over all Taxes required to
have been withheld and paid over, and complied with all information reporting and backup
withholding requirements, including maintenance of required records with respect thereto. Neither
Seller nor any Subsidiary has any liability for unpaid Taxes accruing after the date of its latest
Financial Statements except for Taxes incurred in the ordinary course of business. Except as
disclosed in the Seller SEC Documents, there are no liens for Taxes on the properties of Seller or
any of its Subsidiaries, other than liens for Taxes not yet due and payable.

(b) No Tax Returns of Seller or any of its Subsidiaries have been audited and no audit or
other administrative proceeding is pending or threatened. No judicial proceeding is pending or
threatened that involves any Tax or Tax Return filed or paid by or on behalf of the Seller or any
of its Subsidiaries. Neither the Seller nor any of its Subsidiaries is delinquent in the payment of
any Tax or has requested an extension of time to file a Tax Return and not yet filed such return.
Seller has delivered to Purchaser correct and complete copies of all Tax Returns filed, examination
reports, and statements of deficiencies assessed or agreed to by Seller or any of its Subsidiaries
for the last five (5) years. Neither Seller nor any of its Subsidiaries is delinquent in the
payment of any tax, has waived any statute of limitations in respect of any Tax or agreed to an
extension of time with respect to any Tax assessment or deficiency.

(c) Neither the Seller nor any Subsidiary of the Seller has been a member of an affiliated,
consolidated, combined or unitary group. Neither Seller nor any of its Subsidiaries is a party to
or bound by any tax indemnity agreement, tax sharing agreement, tax shelter vehicle or similar
contract. Neither Seller nor any of its Subsidiaries is a party to any joint venture, partnership,
or other arrangement or contract which could be treated as a partnership or “disregarded entity”
for United States federal income tax purposes.

(d) Neither Seller nor any of its Subsidiaries is obligated under any agreement, contract or
arrangement that may result in the payment of any amount that would not be deductible by reason of
Sections 162(m) or 280G of the Code.

(e) Neither Seller nor any of its Subsidiaries has been or, to its knowledge, will be required
to include any adjustment in Taxable income for any Tax period (or portion thereof) pursuant to
Section 481 or 263A of the Code or any comparable provision under state or foreign Tax laws as a
result of transactions, events or accounting methods employed prior to the Transaction other than
any such adjustments required as a result of the Transaction. Neither Seller nor any of its
Subsidiaries has filed any disclosures under Section 6662 of the Code or comparable provisions of
state, local or foreign law to prevent the imposition of penalties with respect to any Tax
reporting position taken on any Tax Return. Neither Seller nor any of its Subsidiaries has engaged
in a “reportable transaction” within the meaning of the Treasury Regulations under Section 6011 of
the Code. Neither the Seller nor any of its Subsidiaries has received a Tax opinion with respect to
any transaction relating to the Seller or any of its Subsidiaries other than a transaction in the
ordinary course of business. Neither Seller nor any of its Subsidiaries is currently or has been a
United States real property holding corporation (within the meaning of Section 897(c)(2) of the
Code) during the applicable periods specified in Section 897(c)(1)(A)(ii) of the Code.

(f) Neither Seller nor any of its Subsidiaries has been the “distributing corporation” (within
the meaning of Section 355(c)(2) of the Code) with respect to a transaction described in Section
355 of the Code within the five (5) year period ending as of the date of this Agreement. No Tax
Asset of the Seller or any of its Subsidiaries is currently subject to a limitation under Sections
382 or 383 of the Code or similar provisions of state, local or foreign law.

(g) Seller has treated itself as owner of each of the Purchased Assets for Tax purposes. None
of the Purchased Assets is the subject of a “safe-harbor lease” within the provisions of former
Section 168(f)(8) of the Code, as in effect prior to amendment by the Tax Equity and Fiscal
Responsibility Act of 1982. None of the Purchased Assets directly or indirectly secures any debt
the interest on which is tax exempt under Section 103(a) of the Code. None of the Purchased Assets
is “tax-exempt use property” within the meaning of Section 168(h) of the Code or limited use
property under Revenue Procedure 2001-28. None of the Purchased Assets are U.S. real property
interests as described in Section 897 of the Code.

(h) The Seller is a “United States person” within the meaning of Section 7701(a)(30) of the
Code.

4.18 Customers and Privacy. The Seller and its Subsidiaries (i) have fully complied with all
federal, state and local laws relating to privacy and data security and (ii) have complied with all
aspects of collecting and processing customer information and have fully complied with the CAN-Spam
Act when sending commercial emails to customers. The Seller and its Subsidiaries have fully
complied with the terms of their privacy policies, and have not used information collected in a
manner inconsistent in any way with such laws or privacy policies. The Seller’s use, license,
sublicense and sale of any data collected from users at any website operated by the Seller or its
Subsidiaries and any co-branded websites which the Seller manages have complied in all material
respects with the Seller’s applicable published privacy policy at the time such data was collected.
The sale of the Purchased Assets (i) will not violate any federal, state and local laws relating to
privacy and data security and (ii) will fully comply with Seller’s privacy policies. The Seller
has obtained any consent or permission required of any customer prior to the sale of any customer
information that may be included in the Purchased Assets.

4.19 Brokers. The Seller has no Liability or obligation to pay any fees or commissions to any
broker, finder, or agent with respect to the transactions contemplated by this Agreement for which
the Purchaser could become liable or obligated.

4.20 Solvency. Seller is not entering into the Transaction with the intent to hinder, delay or
defraud any Person to which it is, or may become, indebted. The Purchase Price is not less than the
reasonably equivalent value of the Purchased Assets. Seller’s assets, at a fair valuation, exceed
its liabilities, and Seller will be able after the Closing of the Transaction, to meet its debts as
they mature and will not become insolvent as a result of the Transaction. After the Closing of the
Transaction, Seller will have sufficient capital and property remaining to conduct the business in
which it will thereafter be engaged.

4.21 Board Approval. The Board of Directors of Seller has (i) approved and declared advisable
this Agreement and the Transaction and (ii) determined that the Transaction is in the best
interests of the stockholders of Seller and is on terms that are fair to such stockholders.

4.22 Material Third Party Consents. Schedule 4.22 lists all contracts that require a
novation or consent to the Transaction, prior to the Closing Date so that such contracts may remain
in full force and effect after the Closing which, if no novation occurs or if no consent to the
Transaction, would have a Material Adverse Effect on Purchaser’s ability to operate the Business in
the same manner as the Business was operated by Seller prior to the Closing Date.

4.23 No Other Agreement. Neither Seller, nor any of its Representatives, has entered into any
Contract with respect to the sale or other disposition of any assets (including the Purchased
Assets) or capital stock of Seller except as set forth in this Agreement.

4.24 Product Liability.

(a) The Business is not subject to any Liabilities or Damages arising from any injury to
person or property or as a result of ownership, possession or use of any its products manufactured,
processed, distributed, shipped or sold prior to the Closing Date. All such Liabilities and Damages
are fully covered by product liability insurance or otherwise provided for, and Seller shall
properly satisfy and discharge all such Liabilities and Damages. There are no, and within the last
twelve (12) months there have not been any, actions, claims or threats thereof related to product
liability against or involving Seller and no such actions, claims or threats have been settled,
adjudicated or otherwise disposed of within the last twelve (12) months.

(b) There are no citations, decisions, adjudications or written statements by any Governmental
Authority or consent decrees between any Governmental Authority and Seller stating that any of its
products is (i) defective or unsafe or (ii) fails to meet any standards promulgated by any such
standards.

4.25 Full Disclosure.

(a) Neither this Agreement nor any of the other Transaction Agreements, (i) contains or will
contain as of the Closing Date any untrue statement of fact or (ii) omits or will omit to state
any material fact necessary to make any of the representations, warranties or other statements or
information contained herein or therein (in light of the circumstances under which they were made)
not misleading.

(b) There is no fact (other than publicly known facts related exclusively to political or
economic matters of general applicability that will adversely affect all Entities comparable to
Seller) that may have a Material Adverse Effect on Seller.

(c) All of the information set forth in the Seller Disclosure Schedule, and all other
information regarding Seller or Seller’s properties, assets (including the Purchased Assets),
operations, businesses (including the Business), Liabilities, financial performance, net income
and prospects that has been furnished to Purchaser or any of its Representatives by or on behalf
of Seller or any of Seller’s Representatives, is accurate, correct and complete in all material
respects.

(d) Each representation and warranty set forth in this Article 4 is not qualified in
any way whatsoever except as explicitly provided therein, will not merge on Closing or by reason
of the execution and delivery of any Contract at the Closing, will remain in force on and
immediately after the Closing Date subject to the terms and conditions of this Agreement, is given
with the intention that liability is not limited to breaches discovered before Closing, is
separate and independent and is not limited by reference to any other representation or warranty
or any other provision of this Agreement, and is made and given with the intention of inducing
Purchaser to enter into this Agreement.

ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF PURCHASER

Except as specifically set forth on the Schedule 5 (the “Purchaser Disclosure
Schedule”) attached to this Agreement (the parts of which are numbered to correspond to the
applicable Section numbers of this Agreement), Purchaser hereby represents and warrants as of the
date hereof to Seller as follows:

5.1 Organization and Good Standing. Purchaser is a limited liability company duly organized,
validly existing and in good standing under the laws of its jurisdiction of organization.

5.2 Authority; Binding Nature of Agreements. Purchaser has all requisite power and authority
to execute and deliver this Agreement and all other Transaction Agreements to which it is a party
and to carry out the provisions of this Agreement and the other Transaction Agreements. The
execution, delivery and performance by Purchaser of this Agreement and the other Transaction
Agreements have been approved by all requisite action on the part of Purchaser. This Agreement has
been duly and validly executed and delivered by Purchaser. Each of this Agreement and the other
Transaction Agreements constitutes, or upon execution and delivery, will constitute, the legal,
valid and binding obligation of Purchaser, enforceable against Purchaser in accordance with its
terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium and other
similar laws and equitable principles related to or limiting creditors’ rights generally and by
general principles of equity.

5.3 No Conflicts; Required Consents. The execution, delivery and performance of this Agreement
or any other Transaction Agreement by Purchaser do not and will not (with or without notice or
lapse of time) conflict with, violate or result in any breach of (i) any of the provisions of
Purchaser’s Certificate of Formation; (ii) any resolutions adopted by Purchaser’s members or its
board of directors or committees thereof; (iii) any of the terms or requirements of any
Governmental Approval held by Purchaser or any of its employees or that otherwise relates to
Purchaser’s business; or (iv) any provision of a Contract to which Purchaser is a party.

5.4 Brokers. The Purchaser has no Liability or obligation to pay any fees or commissions to
any broker, finder, or agent with respect to the transactions contemplated by this Agreement for
which the Seller could become liable or obligated.

ARTICLE 6. POST CLOSING COVENANTS

6.1 Seller Intellectual Property.

(a) Seller agrees that, from and after the date hereof, it shall not, and it shall cause its
Representatives not to, use any of the Seller Intellectual Property. If Seller or any assignee of
Seller owns or has any right or interest in any Seller Intellectual Property that cannot be, or
for any reason is not, assigned to Purchaser at the Closing, Seller shall grant or cause to be
granted to Purchaser, at the Closing, a worldwide, royalty-free, fully paid up, perpetual,
irrevocable, transferable, sublicensable, and exclusive license to Exercise All Rights in and to
such Seller Intellectual Property.

(b) If Purchaser is unable to enforce its Intellectual Property Rights against a third party
as a result of any Legal Requirement that prohibits enforcement of such rights by a transferee of
such rights, Seller agrees to assign to Purchaser such rights as may be required by Purchaser to
enforce its Intellectual Property Rights in its own name. If such assignment still does not permit
Purchaser to enforce its Intellectual Property Rights against the third party, Seller agrees to
initiate proceedings against such third party in Seller’s name; provided, however, that Purchaser
shall be entitled to participate in such proceedings and provided further that Purchaser shall be
responsible for the costs and expenses of such proceedings.

6.2 Cooperation. After the Closing, upon the request of Purchaser, Seller shall execute and
deliver any and all further materials, documents and instruments of conveyance, transfer or
assignment as may reasonably be requested by Purchaser to effect, record or verify the transfer to,
and vesting in Purchaser, of Seller’s right, title and interest in and to the Purchased Assets,
free and clear of all Encumbrances, in accordance with the terms of this Agreement. After the
Closing, Seller shall (a) reasonably cooperate with Purchaser in its efforts to continue and
maintain for the benefit of Purchaser those business relationships of Seller existing prior to the
Closing and relating to the business to be operated by Purchaser after the Closing; (b) satisfy the
Retained Liabilities in a manner that is not detrimental to any of such relationships; (c) refer to
Purchaser all inquiries relating to such business; (d) promptly deliver to Purchaser (i) any mail,
packages and other communications addressed to Seller relating to the Business and (ii) any cash or
other property that Seller receives and that properly belongs to Purchaser; and (e) cooperate with
Purchaser as may be reasonably required in connection with the execution and closing of the
Trademark Settlement Agreement. Neither Seller nor any of its officers, employees, agents or
stockholders shall take any action that would tend to diminish the value of the Purchased Assets
after the Closing or that would interfere with the business of Purchaser to be engaged in after the
Closing, including disparaging the name or business of Purchaser.

6.3 Limited Power of Attorney. Effective upon the date hereof, Seller hereby irrevocably
appoints Purchaser and its successors, agents and assigns as its true and lawful attorney, in its
name, place and stead, with power of substitution, to take any action and to execute any instrument
which Purchaser may deem necessary or advisable to fulfill Seller’s obligations or rights under, or
to accomplish the purposes of, this Agreement, including, (i) to demand and receive any and all
Purchased Assets and to make endorsements and give receipts and releases for and in respect of the
same; (ii) to institute, prosecute, defend, compromise and/or settle any and all Proceedings with
respect to the Purchased Assets except those Proceedings listed on Schedule 6.3; (iii)  to
make any filings required to transfer any Seller Intellectual Property or any other Purchased
Assets; and (iv) to receive and open all mail, packages and other communications addressed to
Seller and relating to the Business. The foregoing power of attorney is a special power of attorney
coupled with an interest and is irrevocable.

6.4 Return of Purchased Assets. If, for any reason after the Closing, any of the Purchased
Assets are ultimately determined to be Excluded Assets or Retained Liabilities, respectively,
(i) Purchaser shall transfer and convey (without further consideration) to Seller, and Seller shall
accept, such assets; (ii) Seller shall assume, and agree to pay, perform, fulfill and discharge
(without further consideration) such liabilities; and (iii) Purchaser and Seller shall execute such
documents or instruments of conveyance or assumption and take such further acts which are
reasonably necessary or desirable to effect the transfer of such assets back to Seller and the
re-assumption of such liabilities by Seller.

6.5 Bulk Sales Indemnification. Subject to Section 7.2, Purchaser hereby waives compliance by
Seller with any applicable bulk sales Legal Requirements in connection with the Transaction.

6.6 Non-Disclosure and Non-Solicitation.

(a) Nonsolicitation of Customers. Seller agrees that it will not, directly or indirectly,
without the prior written approval of Purchaser, solicit or contact any customer of the Business,
Purchaser, or any potential customer with whom the Business or Purchaser has had any contact, or
from which it has received or to which it has submitted a proposal for products or services, for
the purpose of (i) any commercial pursuit which is in competition with the Business or the
businesses engaged in by Purchaser as of the date hereof, (ii) providing such customer or
potential customer products or services that are the same as or substantially similar to those
provided or offered to be provided by the Business or Purchaser as of the date hereof, or
(iii) taking away or interfering or attempting to interfere with any customer, trade, business or
patronage of the Business or Purchaser.

(b) Non-Solicitation Covenants: Assignment by Purchaser. The parties agree that if Purchaser
or any of its Affiliates shall transfer all or substantially all of the Purchased Assets (as
acquired by Purchaser under this Agreement, the covenants of Seller not to solicit contained in
this Section 6.6 may be assigned by Purchaser to any Person to whom may be transferred the
Business or the Purchased Assets by the sale or transfer of the Business and or Purchased Assets
or otherwise. It is the parties’ intention that these covenants of Seller shall inure to the
benefit of any Person that may succeed to the Business and Purchased Assets of Seller (as acquired
by Purchaser under this Agreement) with the same force and effect as if these covenants were made
directly with such successor

(c) Nondisclosure.

(i) Seller acknowledges that, in connection with the operation of Seller and the Business
prior to the Closing Date, Seller, either directly or indirectly or through its representatives,
has had access to confidential information relating to the Seller and the Business, including
technical, financial or marketing information, lists of vendors, suppliers and customers, ideas,
methods, developments, inventions, improvements, business plans, trade secrets, scientific or
statistical data, diagrams, drawings, specifications, or other proprietary information relating
thereto, including analyses, compilations, studies or other documents, record or data prepared by
Seller or its representatives which contain or otherwise reflect or are generated from such
information (“Confidential Information”) a portion of which is being sold as part of the Purchased
Assets (the “Purchased Confidential Information”).

(ii) Seller agrees that it will treat all Purchased Confidential Information as confidential,
preserve the confidentiality thereof and not use or disclose any Confidential Information for any
purpose or reason whatsoever, except to authorized representatives of Purchaser. If, however,
Confidential Information is disclosed, Seller will immediately notify Purchaser in writing and will
take all reasonable steps required to prevent further disclosure.

(d) Covenants: Remedy for Breach. The parties agree that, in the event of breach or
threatened breach of Seller’s covenants in this Section 6.6, the damage or imminent damage to the
value and the goodwill of Purchaser and the Business will be irreparable and extremely difficult
to estimate, making any remedy at law or in damages inadequate. Accordingly, the parties agree
that Purchaser shall be entitled to injunctive relief against Seller in the event of any breach or
threatened breach of any of such covenants by Seller, in addition to any other relief (including
damages) available to Purchaser under this Agreement or under applicable law. Seller acknowledges
and agrees that (i) the covenants and restrictions contained in this Section 6.6 are necessary,
fundamental and required for the protection of the Business and the business of Purchaser;
(ii) the covenants and restrictions contained in this Section 6.6relate to matters that are of a
special, unique and extraordinary value; (iii) Seller understands that Purchaser would not enter
into this Agreement if Seller did not agree to the provisions of this Section 6.6, and (iv) Seller
has received adequate and independent consideration in respect of such covenants and restrictions.

(e) Covenants: Scope and Choice of Law. It is the understanding of the parties that the scope
of the covenants contained in this Section 6.6, both as to time and area covered, are necessary to
protect the rights of Purchaser and the goodwill that is a part of the Business of Seller to be
acquired by Purchaser. It is the parties’ intention that these covenants be enforced to the
greatest extent (but to no greater extent) in time, area, and degree of participation as is
permitted by the law of that jurisdiction whose law is found to be applicable to any acts in
breach of these covenants. The prohibitions in each of subsections (a)-(c) in Section 6.6 above
shall be deemed, and shall be construed as separate and independent agreements between Purchaser
on the one hand, and Seller on the other. If any such agreement or any part of such agreement is
held invalid, void or unenforceable by any court of competent jurisdiction, such invalidity,
voidness, or unenforceability shall in no way render invalid, void, or unenforceable any other
part of them or any separate agreement not declared invalid, void or unenforceable; and this
Agreement shall in such case be construed as if the invalid, void, or unenforceable provisions
were omitted. Seller agrees not challenge, and not to permit encourage or assist any of its
Affiliates from challenging, the enforceability of the covenants contained in this Section 6.6.

6.7 Publicity. Neither Seller nor Purchaser shall issue any press release or public
announcement concerning this Agreement or the transactions contemplated hereby without obtaining
the prior written approval of the other party hereto, which approval will not be unreasonably
withheld or delayed, unless, in the sole judgment of Purchaser or Seller, disclosure is otherwise
required by applicable Law or by the applicable rules of any stock exchange on which Purchaser or
Seller lists securities, provided that, to the extent required by applicable law, the party
intending to make such release shall use its best efforts consistent with such applicable law to
consult with the other party with respect to the text thereof.

6.8 Ice.com Covenants. Purchaser acknowledges and agrees to be bound by the restrictions
contained in Sections 6.11(h) and 7.6 (the “Subject Provisions”) of the Asset Purchase Agreement
dated May 11, 2006 by and among Ice.com, Inc., Ice Diamond, LLC (the “Ice Parties”) and Seller
solely as such provisions apply to Purchaser with respect to the Purchased Assets, provided that in
the event Purchaser procures a release from the Ice Parties in respect of the application of the
Subject Provisions to the transactions contemplated under this Agreement, then Purchaser shall have
no continuing obligation under this paragraph.

ARTICLE 7. INDEMNIFICATION

7.1 Survival of Representations and Warranties. All representations, warranties, covenants,
conditions and agreements contained herein or in any other instrument or other document delivered
pursuant to this Agreement or in connection with the Transaction shall survive the execution and
delivery of this Agreement, the consummation of the Transaction and any investigation or audit made
by any party hereto provided, however, that (a) all representations and warranties relating to
Taxes shall survive until six (6) months after the expiration of the statute of limitation
applicable to such Taxes has expired (including all waivers and extensions thereof), (b) all
representations and warranties of Seller or Purchaser contained in Sections 4.1, 4.2, 4.3, 4.7,
4.8(a), 4.13, 4.16 and 4.18, 5.1, 5.2 or 5.3 shall survive until the expiration of the applicable
statute of limitations; (c) all representations and warranties other than those referred to in
clauses (a) or (b) above shall survive for a period of 12 months from the Closing Date and (d) any
claim for indemnification based upon a breach of any such representation or warranty and asserted
prior to end of the applicable survival period by written notice in accordance with
Section 8.2 shall survive until final resolution of such claim. The representations and
warranties contained in this Agreement (and any right to indemnification for breach thereof) shall
not be affected by any investigation, verification or examination by any party hereto or by any
Representative of any such party or by any such party’s Knowledge of any facts with respect to the
accuracy or inaccuracy of any such representation or warranty.

7.2 Indemnification by Seller. Subject to the limitations set forth in this Article 7,
Seller shall indemnify, defend and hold harmless Purchaser and its Representatives (each a
“Purchaser Indemnitee”) from and against any and all Damages, whether or not involving a
third-party claim, including attorneys’ fees and related defense costs and expenses (collectively,
“Purchaser Damages”), arising out of, relating to or resulting from (a) any breach of a
representation or warranty of Seller contained in this Agreement or in any other Transaction
Agreement; (b) any breach of a covenant of Seller contained in this Agreement or in any other
Transaction Agreement; (c) Excluded Assets or Retained Liabilities; or (d) any noncompliance with
applicable bulk sales or fraudulent transfer Legal Requirements in connection with the Transaction.

7.3 Procedures for Indemnification. Promptly after receipt by a Purchaser Indemnitee of
written notice of the assertion or the commencement of any Proceeding by a third-party with respect
to any matter referred to in Section 7.2, the Indemnitee shall give written notice thereof
to the Seller, and thereafter shall keep the Seller reasonably informed with respect thereto;
provided, however, that failure of the Indemnitee to give the Seller notice as provided herein
shall not relieve the Seller of its obligations hereunder except to the extent that the Seller is
prejudiced thereby. The Seller shall have the right to join in the defense of said claim, action or
proceeding at Seller’s own cost and expense and, if the Seller agrees in writing to be bound by and
to promptly pay the full amount of any final judgment from which no further appeal may be taken and
if the Indemnitee is reasonably assured of the Seller’s ability to satisfy such agreement, then at
the option of the Seller, the Seller may take over the defense of such claim, action or proceeding,
except that, in such case, the Indemnitee shall have the right to join in the defense of said
claim, action or proceeding at its own cost and expense and provided that whether or not
the Seller takes over defense of a claim, the Seller shall not admit any liability with respect to,
or settle, compromise or discharge, such claim without the Indemnitees’s prior written consent
(which consent shall not be unreasonably withheld); provided further that the
Seller shall not agree, without the Indemnitee’s consent, to the entry of any Judgment or
settlement, compromise or decree that provides for injunctive or other nonmonetary relief affecting
the Indemnitee.

7.4 Remedies Cumulative. The remedies provided in this Agreement shall be cumulative and shall
not preclude any party from asserting any other right, or seeking any other remedies, against the
other party.

7.5 Maximum Amounts. The aggregate liability of the Seller to indemnify Purchaser Indemnitees
entitled to indemnification for Damages under Section 7.2 or any breach of this Article 7 shall in
no event exceed the Purchased Assets Purchase Price; provided, however, that this first sentence of
this Section 7.5 shall not apply to any Damages arising in connection with those matters listed on
Schedule 7.5. Notwithstanding anything to the contrary contained in this Agreement nothing
herein shall foreclose, limit or prevent Purchaser from seeking and obtaining, as and to the extent
permitted under applicable law, specific performance by Seller of any of its obligations under this
Agreement or injunctive relief against the Seller against Seller’s activities in breach of this
Agreement (including, without limitation, the obligations provided for under Article 7).

7.6 Liability of Purchaser. The fact that Purchaser is not obligated to indemnify Seller
hereunder shall not be construed so as to limit the rights or remedies that Seller may otherwise
have against Purchaser, whether under this Agreement or applicable law, in the event of (a) any
breach or inaccuracy of a representation or warranty of Purchaser contained in this Agreement or
(b) any failure by Purchaser to perform or comply with any covenant given by Purchaser contained in
this Agreement.

ARTICLE 8. MISCELLANEOUS PROVISIONS

8.1 Expenses. Each party shall pay it own costs and expenses in connection with this Agreement
and the Transaction (including the fees and expenses of its advisers, accountants and legal
counsel).

8.2 Notices. All notices and other communications hereunder shall be in writing and shall be
deemed given if delivered personally or by commercial delivery service, or mailed by registered or
certified mail (return receipt requested) or sent via facsimile (with confirmation of receipt) to
the parties at the following addresses (or at such other address for a party as shall be specified
by like notice):

(a) if to Purchaser, to:

Eli Katz

Chief Executive Officer

Luxi Group, LLC

415 Madison Avenue, 16th Floor

New York, NY 10017

Facsimile No.:

Telephone No.:

with a copy to:

Fish & Richardson P.C.

153 East 53rd Street, 52nd Floor

New York, NY 10022-4611

Attention: Peter Fields, Esq.

Facsimile No.: (212) 258-2291

Telephone No.: (212) 641-2266

(b) if to Seller, to:

Amerisa Kornblum

President

Odimo Incorporated

14051 NW 14th Street, Sunrise Florida, 33323

Facsimile No.:

Telephone No.: (954) 835-2233

with a copy to:

Berman Rennert Vogel & Mandler, P.A.

Bank of America Tower at International Place, 29th Floor

100 S.E. Second Street

Miami, Florida 33131

Attention: Charles Rennert, Esq.

Facsimile No.: (305) 347-6463

Telephone No.: (305) 577-4171

8.3 Interpretation. Whenever the words “include,” “includes” or “including” are used in this
Agreement, they shall be deemed, as the context indicates, to be followed by the words “but
(is/are) not limited to.”

8.4 Counterparts; Facsimile Delivery. This Agreement may be executed in one or more
counterparts and delivered by facsimile, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been signed by each of the
parties and delivered to the other parties, it being understood that all parties need not sign the
same counterpart.

8.5 Entire Agreement; Nonassignability; Parties in Interest. This Agreement and the documents
and instruments and other agreements specifically referred to herein or delivered pursuant hereto,
including the Appendices, Exhibits and the Seller Disclosure Schedule, (a) constitute the entire
agreement among the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, both written and oral, among the parties with respect to the subject
matter hereof, (b) are not intended to confer upon any other Person any rights or remedies
hereunder and (c) shall not be assigned by operation of law or otherwise except as otherwise
specifically provided.

8.6 Severability. In the event that any provision of this Agreement, or the application
thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of this Agreement will continue in full force and effect and the
application of such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further agree to replace such
void or unenforceable provision of this Agreement with a valid and enforceable provision that will
achieve, to the extent possible, the economic, business and other purposes of such void or
unenforceable provision.

8.7 Governing Law; Jurisdiction and Venue; Waiver Of Jury Trial. This Agreement shall be
governed by and construed in accordance with the laws of Florida without reference to such state’s
principles of conflicts of law. Each of the parties hereto irrevocably consents to the jurisdiction
of any state court located within the State of Florida in connection with any matter based upon or
arising out of this Agreement or the matters contemplated herein, agrees that process may be served
upon them in any manner authorized by the laws of the State of Florida for such persons and waives
and covenants not to assert or plead any objection which they might otherwise have to such
jurisdiction and such process. THE PARTIES HERETO IRREVOCABLY WAIVE THE RIGHT TO A JURY TRIAL IN
CONNECTION WITH ANY ACTIONS, SUITS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
MERGER OR THE TRANSACTIONS CONTEMPLATED HEREBY.

8.8 Rules of Construction. The parties hereto agree that they have been represented by counsel
during the negotiation, preparation and execution of this Agreement and, therefore, waive the
application of any law, regulation, holding or rule of construction providing that ambiguities in
an agreement or other document will be construed against the party drafting such agreement or
document.

8.9 Incorporation of Appendices, Exhibits and Schedules. The Appendices, Exhibits and
Schedules identified in this Agreement are incorporated herein by reference and made a part hereof.

8.10 Assignment. Neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by any of the parties hereto, in whole or in part (whether by operation
of law or otherwise), without the prior written consent of the other party, and any attempt to make
any such assignment without such consent shall be null and void. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.

8.11 Attorneys’ Fees. In any action at law or suit in equity to enforce this Agreement or the
rights of any of the parties hereunder, the prevailing party in such action or suit shall be
entitled to receive a sum for its attorneys’ fees and all other costs and expenses incurred in such
action or suit.

8.12 Further Assurances. Each party agrees (a) to furnish upon request to each other party
such further information, (b) to execute and deliver to each other party such other documents, and
(c) to do such other acts and things, all as another party may reasonably request for the purpose
of carrying out the intent of this Agreement and the Transaction.

[Signatures Follow On a Separate Page]

2

IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed on its behalf
by their respective officers thereunto duly authorized all as of the date first written above.

“Purchaser”

LUXI GROUP, LLC

By: /s/ Eli Katz

Name: Eli Katz

Title: Chief Executive Officer

“Seller”

ODIMO INCORPORATED

By: /s/ Amerisa Kornblum

Name: Amerisa Kornblum

Title: President

ASHFORD.COM, INC.

By: /s/ Amerisa Kornblum

Name: Amerisa Kornblum

Title: President

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APPENDIX 1

CERTAIN DEFINITIONS

“Affiliate” shall mean any member of the immediate family (including spouse, brother,
sister, descendant, ancestor or in-law) of any officer, director or stockholder of Seller or any
corporation, partnership, trust or other entity in which Seller or any such family member has a
five percent (5%) or greater interest or is a director, officer, partner or trustee. The term
Affiliate shall also include any entity which controls, or is controlled by, or is under common
control with any of the individuals or entities described in the preceding sentence.

“Agreement” shall mean the Asset Purchase Agreement to which this Appendix 1 is
attached (including the Seller Disclosure Schedule and all other appendices, schedules and exhibits
attached hereto), as it may be amended from time to time.

“Business” shall have the meaning set forth in the first Recital.

“Closing” shall have the meaning specified in Section 3.1.

“Closing Date” shall have the meaning specified in Section 3.1.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Confidential Information” shall mean all Trade Secrets and other confidential and/or
proprietary information of a Person, including information derived from reports, investigations,
research, work in progress, codes, marketing and sales programs, financial projections, cost
summaries, pricing formula, contract analyses, financial information, projections, confidential
filings with any state or federal agency, and all other confidential concepts, methods of doing
business, ideas, materials or information prepared or performed for, by or on behalf of such Person
by its employees, officers, directors, agents, representatives, or consultants. Information shall
not be deemed Confidential Information hereunder if (i) such information becomes available to or
known by the public generally through no fault of Seller or (ii) disclosure is required by law or
the order of any governmental authority under color of law, provided, however, that prior to
disclosing any information pursuant to this clause (ii), Seller shall, if possible, give prior
written notice thereof to Purchaser and, at Purchaser’s election, either provide Purchaser with the
opportunity to contest such disclosure or seek to obtain a protective order narrowing the scope of
such disclosure and/or use of the Confidential Information; or (iii) Seller reasonably believes
that such disclosure is required in connection with the defense of a lawsuit against Seller.
Nothing herein shall be construed as prohibiting Purchaser from pursuing any other available remedy
for such breach or threatened breach, including the recovery of damages..

“Consent” shall mean any approval, consent, ratification, permission, waiver or
authorization (including any Governmental Approval).

“Contract” shall mean any agreement, contract, consensual obligation, promise,
understanding, arrangement, commitment or undertaking of any nature (whether written or oral and
whether express or implied), whether or not legally binding.

“Contract Affiliates” shall mean Entities which are parties to Affiliate Agreements whereby
such entities are compensated for sales resulting from the directions of customers to websites
maintained by the Business.

“Copyrights” shall mean all copyrights, including in and to works of authorship and all
other rights corresponding thereto throughout the world, whether published or unpublished,
including rights to prepare, reproduce, perform, display and distribute copyrighted works and
copies, compilations and derivative works thereof.

“Damages” shall mean and include any loss, damage, injury, decline in value, lost
opportunity, Liability, claim, demand, settlement, judgment, award, fine, penalty, Tax, fee
(including any legal fee, accounting fee, expert fee or advisory fee), charge, cost (including any
cost of investigation) or expense of any nature.

“Defined Benefit Plan” shall mean either a plan described in Section 3(35) of ERISA or a
plan subject to the minimum funding standards set forth in Section 302 of ERISA and Section 412 of
the Code.

“Encumbrance” shall mean any lien, pledge, hypothecation, charge, mortgage, security
interest, encumbrance, equity, trust, equitable interest, claim, preference, right of possession,
lease, tenancy, license, encroachment, covenant, infringement, interference, Order, proxy, option,
right of first refusal, preemptive right, community property interest, legend, defect, impediment,
exception, reservation, limitation, impairment, imperfection of title, condition or restriction of
any nature (including any restriction on the voting of any security, any restriction on the
transfer of any security or other asset, any restriction on the receipt of any income derived from
any asset, any restriction on the use of any asset and any restriction on the possession, exercise
or transfer of any other attribute of ownership of any asset).

“Entity” shall mean any corporation (including any non-profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture, estate, trust or
company (including any limited liability company or joint stock company).

“Environmental Laws” shall have the meaning specified in Section 4.19.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” shall mean each trade or business, whether or not incorporated, that
would be treated as a single employer with Seller under Section 4001 of ERISA or Section 414(b),
(c), (m) or (o) of the Code.

“Exchange Act” shall have the meaning specified in Section 4.16(a).

“Excluded Assets” shall have the meaning specified in Section 1.2.

“Exercise All Rights” shall mean to exercise or practice any and all rights now or
hereafter provided by law (by treaty, statute, common law or otherwise) anywhere in the world to
inventors, authors, creators and/or owners of intellectual or intangible property; including the
right to make, use, disclose, sell, offer to sell, distribute, import, rent, lease, lend,
reproduce, prepare derivative works of and otherwise modify, perform and display (whether publicly
or otherwise), broadcast, transmit, use and/or otherwise exploit such intellectual or intangible
property and/or any product, component or service embodying, related to or subject to such
intellectual or intangible property; and the right to assign, transfer, license and/or sublicense
(with the right to sublicense further) any of the foregoing, and the right to have and/or authorize
others to do any of the foregoing.

“FIRPTA Notification Letter” shall have the meaning specified in Section 3.2(d).

“GAAP” means U.S. generally accepted accounting principles in effect on the date on which
they are to be applied pursuant to this Agreement, applied consistently throughout the relevant
periods.

“General Assignment and Bill of Sale” shall have the meaning specified in
Section 3.2(a).

“Governmental Approval” shall mean any: (a) permit, license, certificate, concession,
approval, consent, ratification, permission, clearance, confirmation, exemption, waiver, franchise,
certification, designation, rating, registration, variance, qualification, accreditation or
authorization issued, granted, given or otherwise made available by or under the authority of any
Governmental Authority or pursuant to any Legal Requirement; or (b) right under any Contract with
any Governmental Authority.

“Governmental Authority” shall mean any: (a) nation, principality, state, commonwealth,
province, territory, county, municipality, district or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi
governmental authority of any nature (including any governmental division, subdivision, department,
agency, bureau, branch, office, commission, council, board, instrumentality, officer, official,
representative, organization, unit, body or Entity and any court or other tribunal);
(d) multinational organization or body; or (e) individual, Entity or body exercising, or entitled
to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or
taxing authority or power of any nature.

“Hazardous Materials” shall have the meaning specified in Section 4.19.

“Indemnitee” shall have the meaning specified in Section 7.3.

“Intellectual Property Rights” shall mean any or all rights in and to intellectual
property and intangible industrial property rights, including, without limitation, (i) Patents,
Trade Secrets, Copyrights, Trademarks and (ii) any rights similar, corresponding or equivalent to
any of the foregoing anywhere in the world.

“Knowledge” An individual shall be deemed to have “Knowledge” of a particular fact or other
matter if: (i) such individual is actually aware of such fact or other matter or (ii)  a prudent
individual could be expected to discover or otherwise become aware of such fact or other matter in
the course of conducting a reasonably comprehensive investigation concerning the truth or existence
of such fact or other matter. Seller and Purchaser shall be deemed to have “Knowledge” of a
particular fact or other matter if any of their respective directors, officers or employees with
the authority to establish policy for the company has actual knowledge of such fact or other matter
after due and diligent inquiry.

“Legal Requirement” shall mean any federal, state, local, municipal, foreign or other law,
statute, legislation, constitution, principle of common law, resolution, ordinance, code, Order,
edict, decree, proclamation, treaty, convention, rule, regulation, permit, ruling, directive,
pronouncement, requirement (licensing or otherwise), specification, determination, decision,
opinion or interpretation that is, has been or may in the future be issued, enacted, adopted,
passed, approved, promulgated, made, implemented or otherwise put into effect by or under the
authority of any Governmental Authority.

“Liability” shall mean any debt, obligation, duty or liability of any nature (including any
unknown, undisclosed, unmatured, unaccrued, unasserted, contingent, indirect, conditional, implied,
vicarious, derivative, joint, several or secondary liability), regardless of whether such debt,
obligation, duty or liability would be required to be disclosed on a balance sheet prepared in
accordance with generally accepted accounting principles and regardless of whether such debt,
obligation, duty or liability is immediately due and payable.

“Material Adverse Effect” means (i) with respect to Purchaser, any event, change or effect
that, when taken individually or together with all other adverse events, changes and effects, is or
is reasonably likely (a) to be materially adverse to the condition (financial or otherwise),
properties, assets, liabilities, business, operations, results of operations or prospects of
Purchaser or its subsidiaries, taken as a whole or (b) to prevent or materially delay consummation
of the Transaction or otherwise to prevent Purchaser or its subsidiaries from performing their
obligations under this Agreement and (ii) with respect to Seller or the Business, any event, change
or effect that, when taken individually or together with all other adverse events, changes and
effects, is or is reasonably likely (a) to be materially adverse to the condition (financial or
otherwise), properties, assets (including Purchased Assets), liabilities, business, operations,
results of operations or prospects of Seller, its Subsidiaries, or the Business or (b) to prevent
or materially delay consummation of the Transaction or otherwise to prevent Seller or its
Subsidiaries from performing their obligations under this Agreement.

“Material Contracts” shall have the meaning specified in Section 4.6.

“Multiemployer Plan” shall mean a plan described in Section 3(37) of ERISA.

“Non-Assignable Asset” shall have the meaning specified in Section 1.5(a).

“Officer’s Certificate” shall have the meaning specified in Section 3.2(f).

“Order” shall mean any: (a) temporary, preliminary or permanent order, judgment,
injunction, edict, decree, ruling, pronouncement, determination, decision, opinion, verdict,
sentence, stipulation, subpoena, writ or award that is or has been issued, made, entered, rendered
or otherwise put into effect by or under the authority of any court, administrative agency or other
Governmental Authority or any arbitrator or arbitration panel; or (b) Contract with any
Governmental Authority that is or has been entered into in connection with any Proceeding.

“Patents” shall mean all United States and foreign patents and utility models and
applications therefor and all reissues, divisions, re-examinations, renewals, extensions,
provisionals, continuations and continuations-in-part thereof, and equivalent or similar rights
anywhere in the world in inventions and discoveries, including invention disclosures related to the
Business or any Purchased Assets.

“Person” shall mean any individual, Entity or Governmental Authority.

“Personal Property” shall mean all personal property, office furnishings and furniture,
display racks, shelves, decorations, supplies and other tangible personal property used in the
Business or in connection with the Purchased Assets.

“Personal Property Leases” shall mean all rights in, to and under leases of personal
property to which Seller is a party.

“Proceeding” shall mean any action, suit, litigation, arbitration, proceeding (including
any civil, criminal, administrative, investigative or appellate proceeding), prosecution, contest,
hearing, inquiry, inquest, audit, examination or investigation that is, has been or may in the
future be commenced, brought, conducted or heard at law or in equity or before any Governmental
Authority or any arbitrator or arbitration panel.

“PTO” shall have the meaning specified in Section 4.10(g).

“Purchase Price” shall have the meaning specified in Section 2.1(a).

“Purchased Assets” shall have the meaning specified in Section 1.1.

“Purchaser Damages” shall have the meaning specified in Section 7.2.

“Purchaser Disclosure Schedule” shall have the meaning specified in Article 5.

“Real Property” shall mean land, buildings, structures, easements, appurtenances,
improvements and fixtures located thereon.

“Registered Intellectual Property Rights” shall mean all United States, international and
foreign: (i) Patents, including applications therefor; (ii) registered Trademarks, applications to
register Trademarks, including intent-to-use applications, or other registrations or applications
related to Trademarks; (iii) Copyright registrations and applications to register Copyrights; and
(iv) any other Intellectual Property Rights that is the subject of an application, certificate,
filing, registration or other document issued by, filed with, or recorded by, any state, government
or other public legal authority at any time.

“Representatives” shall mean officers, directors, employees, attorneys, accountants,
advisors, agents, distributors, licensees, shareholders, subsidiaries and lenders of a party. In
addition, all Affiliates of Seller shall be deemed to be “Representatives” of Seller.

“Retained Liabilities” shall have the meaning specified in Section 1.4.

“Secretary’s Certificate” shall have the meaning specified in Section 3.2(g).

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Seller Benefit Plans” shall mean any “employee benefit plan,” as defined in Section 3(3)
of ERISA, any employment, severance or similar contract or arrangement, or any plan, policy, fund,
program or contract or arrangement providing for compensation, bonus, profit-sharing, stock option,
or other stock related rights or other forms of incentive or deferred compensation, vacation
benefits, insurance coverage (including any self-insured arrangements), health or medical benefits,
disability benefits, workers’ compensation, supplemental unemployment benefits, and post-employment
or retirement benefits (including compensation, pension, health, medical or life insurance or other
benefits) that is maintained, administered, or contributed to by any ERISA Affiliate.

“Seller Disclosure Schedule” shall have the meaning specified in Article 4.

“Seller Financial Statements” shall have the meaning specified in Section 4.16(b)

“Seller Intellectual Property” shall mean all Intellectual Property Rights related to the
Business, the Purchased Assets and held by Seller, whether owned or controlled, licensed, owned or
controlled by or for, licensed to, or otherwise held by or for the benefit of Seller including the
Seller Registered Intellectual Property Rights.

“Seller Registered Intellectual Property Rights” shall have the meaning specified in
Section 4.10(a).

“Seller SEC Documents” shall have the meaning specified in Section 4.16(a).

“Solvent” shall mean, as to any Person at any time, that (a) the fair value of the property
of such Person is greater than the amount of such Person’s liabilities (including disputed,
contingent and unliquidated liabilities) as such value is established and liabilities evaluated for
purposes of Section 101(32) of the Bankruptcy Code; (b) the present fair saleable value of the
property of such Person is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured; (c) such Person is able
to realize upon its property and pay its debts and other liabilities (including disputed,
contingent and unliquidated liabilities) as they mature in the normal course of business; (d) such
Person does not intend to, and does not believe that it will, incur debts or liabilities beyond
such Person’s ability to pay as such debts and liabilities mature; and (e) such Person is not
engaged in business or a transaction, and is not about to engage in business or a transaction, for
which such Person’s property would constitute unreasonably small capital.

“SOX” shall have the meaning specified in Section 4.16(c).

“Subsidiary” shall have the meaning specified in Section 1.4.

“Survival Date” shall have the meaning specified in Section 7.1.

“Tax” (and, with correlative meaning, “Taxes” and “Taxable”) means any net income,
alternative or add-on minimum tax, gross income, gross receipts, sales, use, ad valorem, transfer,
franchise, profits, license, withholding, payroll, employment, excise, severance, stamp,
occupation, premium, property, environmental or windfall profit tax, custom, duty or other tax,
governmental fee or other assessment or charge of any kind whatsoever, together with any interest
or any penalty, addition to tax or additional amount and any interest on such penalty, addition to
tax or additional amount, imposed by any Tax Authority.

“Tax Authority” means Governmental Authority responsible for the imposition, assessment or
collection of any Tax (domestic or foreign).

“Tax Return” shall mean any return, statement, declaration, notice, certificate or other
document that is or has been filed with or submitted to, or required to be filed with or submitted
to, any Governmental Authority in connection with the determination, assessment, collection or
payment of any Tax or in connection with the administration, implementation or enforcement of or
compliance with any Legal Requirement related to any Tax.

“Trade Secrets” shall mean all trade secrets under applicable law and other rights in
know-how and confidential or proprietary information, processing, manufacturing or marketing
information, including new developments, inventions, processes, ideas or other proprietary
information that provide Seller with advantages over competitors who do not know or use it and
documentation thereof (including related papers, blueprints, drawings, chemical compositions,
formulae, diaries, notebooks, specifications, designs, methods of manufacture and data processing
software, compilations of information) and all claims and rights related thereto.

“Trademarks” shall mean any and all trademarks, service marks, logos, trade names,
corporate names, universal resource locator (“url”), Internet domain names and addresses and
general-use e-mail addresses, and all goodwill associated therewith throughout the world.

“Transaction” shall mean, collectively, the transactions contemplated by this Agreement.

“Transaction Agreements” shall mean this Agreement and all other agreements, certificates,
instruments, documents and writings delivered by Purchaser and/or Seller in connection with the
Transaction, including but not limited to the Transition Services Agreement.

“Transfer Taxes” shall mean all federal, state, local or foreign sales, use, transfer, real
property transfer, mortgage recording, stamp duty, value-added or similar Taxes that may be imposed
in connection with the transfer of Purchased Assets to Purchaser, together with any interest,
additions to Tax or penalties with respect thereto and any interest in respect of such additions to
Tax or penalties.

“WARN Act” shall have the meaning specified in Section 4.16(e)

4

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