Document:

a5454983ex10_2.htm

    Exhibit
      10.2

     

    
CORPORATE
      INTEGRITY AGREEMENT

    BETWEEN
      THE

    OFFICE
      OF INSPECTOR GENERAL

    OF
      THE

    DEPARTMENT
      OF HEALTH AND HUMAN
SERVICES

    AND

    MAXIMUS,
INC.

     

    I.           PREAMBLE

     

    Maximus,
      Inc., on behalf of the Maximus Consulting Segment, hereby enters into this
      Corporate Integrity Agreement (CIA) with the Office of Inspector General (OIG)
      of the United States Department of Health and Human Services (HHS) to promote
      compliance with the statutes, regulations, and written directives of Medicare,
      Medicaid, and all other Federal health care programs (as defined in 42 U.S.C.
§
1320a-7b(f)) (Federal health care program requirements). Contemporaneously
      with
      this CIA, Maximus is entering into a Settlement Agreement with the United
      States.

     

    II.           TERM
      AND SCOPE
      OF THE
CIA

     

    A.           The
      period of the compliance obligations assumed by Maximus under this CIA shall
      be
      five years from the effective date of this CIA, unless otherwise specified.
      The
      effective date shall be the date on which the final signatory of this CIA
      executes this CIA (Effective Date). Each one-year period, beginning with the
      one-year period following the Effective Date, shall be referred to as a
“Reporting Period.”

     

    B.           Sections
      VII, IX, X, and XI shall expire no later than 120 days after OIG’s receipt of:
      (1) Maximus’ final annual report; or (2) any additional materials submitted by
      Maximus pursuant to OIG’s request, whichever is later.

     

    
      C.           The
        scope
        of this CIA shall be governed by the following definitions: 

       

      1.
        “Covered Persons” includes:

    

     

    a.       all
      officers, directors, and employees of Maximus; and

     

    b.       all
      contractors, subcontractors, agents, and other persons who perform work under
      a
      contract that relates to maximizing Federal health care program reimbursement
      and/or who perform claiming functions relating to Federal health care
      programs;

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

       

    

    Notwithstanding
      the above, this term does not include part-time or per diem employees,
      contractors, subcontractors, agents, and other persons who are not reasonably
      expected to work more than 160 hours per year, except that any such individuals
      shall become “Covered Persons” at the point when they work more than 160 hours
      during the calendar year.

     

    2.
      “Relevant Covered Persons” includes Covered Persons involved in work performed
      under a contract that related to maximizing Federal health care program
      reimbursement and/or in the preparation or submission of claims for
      reimbursement from any Federal health program care program.

     

    III.
CORPORATE
INTEGRITY
OBLIGATIONS

     

    Maximus
      shall revise and enhance its existing Compliance Program such that it includes
      the following elements:

     

    A.
      Compliance Officer and Committee.

     

    1.
Compliance
Officer.
Within
      90 days after
      the Effective Date, Maximus shall appoint an individual to serve as its
      Compliance Officer and shall maintain a Compliance Officer for the term of
      the
      CIA. The Compliance Officer shall be responsible
      for developing and implementing policies, procedures, and practices designed
      to
      ensure compliance with the requirements set forth in this CIA and with Federal
      health care program requirements. The Compliance Officer shall be a member
      of
      senior management of Maximus, shall make periodic (at least quarterly) reports
      regarding compliance matters directly to the Board of Directors of Maximus,
      and
      shall be authorized to report on such matters to the Board of Directors at
      any
      time. The Compliance Officer shall not be or be subordinate to the General
      Counsel or Chief Financial Officer. The Compliance Officer shall be responsible
      for monitoring the day-to-day compliance activities engaged in by Maximus as
      well as for any reporting obligations created under this CIA.

     

    Maximus
      shall report to OIG, in writing, any changes in the identity or position
      description of the Compliance Officer, or any actions or changes that would
      affect the Compliance Officer’s ability to perform the duties necessary to meet
      the obligations in this CIA, within 15 days after such a change.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    2.
Compliance
      Committee.
Within 90 days after the Effective Date, Maximus shall appoint
      a
      Compliance Committee. The Compliance Committee shall, at a minimum, include
      the
      Compliance Officer and other members of senior management necessary to meet
      the
      requirements of this CIA (e.g., senior executives with relevant
      responsibilities such as quality assurance, contract management and oversight,
      audit, and operations). The Compliance Officer shall chair the Compliance
      Committee and the Committee shall support the Compliance Officer in fulfilling
      his/her responsibilities (e.g., shall assist in the analysis of the
      organization’s risk areas and shall oversee monitoring of internal and external
      audits and investigations).

     

    Maximus
      shall report to OIG, in writing, any changes in the composition of the
      Compliance Committee, or any actions or changes that would affect the Compliance
      Committee’s ability to perform the duties necessary to meet the obligations in
      this CIA, within 15 days after such a change.

     

    B.
      Written Standards.

     

    1.
Code
      of Conduct. Within
      90 days after the Effective Date, Maximus shall develop, implement, and
      distribute a written Code of Conduct to all Relevant Covered Persons. The Code
      will be distributed to all other Covered Persons within 150 days of the
      Effective Date. Maximus shall make the promotion of, and adherence to, the
      Code
      of Conduct an element in evaluating the performance of all employees. The Code
      of Conduct shall, at a minimum, set forth:

     

    
      	
               

            	
              a.

            	
              Maximus’
                commitment to full compliance with all Federal health care program
                requirements, including its commitment to fulfill all of its contractual
                obligations and prepare and submit accurate claims in manner that
                is
                consistent with such requirements;

            

    

     

    
      	
               

            	
              b.

            	
              Maximus’
                commitment to adhere to professional and ethical standards of conduct
                for
                consultants;

            

    

     

    
      	
            	
              c.

            	
              Maximus’
                requirement that all of its Covered Persons shall be expected to
                comply
                with all Federal health care program requirements and with Maximus’ own
                Policies and Procedures as implemented pursuant to Section III.B
                (including the requirements of this
                CIA);

            

    

     

    
      
        
        

      

      
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              d.

            	
              the
                requirement that all of Maximus’ Covered Persons shall be expected to
                report to the Compliance Officer, or other appropriate individual
                designated by Maximus, suspected violations of any Federal health
                care
                program requirements or of Maximus’ own Policies and
                Procedures;

            

    

     

    
      	
            	
              e.

            	
              the
                possible consequences to both Maximus and Covered Persons of failure
                to
                comply with Federal health care program requirements and with Maximus’ own
                Policies and Procedures and the failure to report such noncompliance;
                and

            

    

     

    
      	
            	
              f.

            	
              the
                right of all individuals to use the Disclosure Program described
                in
                Section III.E, and Maximus’ commitment to nonretaliation and to maintain,
                as appropriate, confidentiality and anonymity with respect to such
                disclosures.

            

    

     

    Within
      90
      days after the Effective Date, each Relevant Covered Person shall certify,
      in
      writing, that he or she has received, read, understood, and shall abide by
      Maximus’ Code of Conduct. Within 150 days after the Effective Date, all other
      Covered Persons shall certify, in writing, that he or she has received, read,
      understood, and shall abide by Maximus’ Code of Conduct. New Covered Persons
      shall receive the Code of Conduct and shall complete the required certification
      within 90 days after becoming a Covered Person or within 150 days after the
      Effective Date, whichever is later. New Relevant Covered Persons shall receive
      the Code of Conduct and shall complete the required certification within 30
      days
      after becoming a Relevant Covered Person or within 90 days after the Effective
      Date, whichever is later.

     

    Maximus
      shall periodically review the Code of Conduct to determine if revisions are
      appropriate and shall make any necessary revisions based on such review. Any
      revised Code of Conduct shall be distributed within 30 days after any revisions
      are finalized. Each Covered Person shall certify, in writing, that he or she
      has
      received, read, understood, and shall abide by the revised Code of Conduct
      within 30 days after the distribution of the revised Code of
      Conduct.

     

    2.
Policies
      and Procedures.
Within 90 days after the Effective Date, Maximus shall implement
      written Policies and Procedures regarding the operation of Maximus’ compliance
      program and its compliance with Federal health care program requirements. At
      a
      minimum, the Policies and Procedures shall address:

    
 

    
      
        
        

      

      
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              a.

            	
              the
                subjects relating to the Code of Conduct identified in Section
                III.B.1;

            

    

     

    
      	
               

            	
              b.

            	
              measures
                to ensure that Maximus employees document in writing all recommendations
                and steps taken to maximize Federal health care
                reimbursement;

            

    

     

    
      	
               

            	
              c.

            	
              measures
                to ensure that quality assurance reviews are performed prior to
                submissions of recommendations for maximizing Federal health care
                program
                reimbursement;

            

    

     

    
      	
               

            	
              d.

            	
              measures
                to ensure that all Covered Persons engaged in the preparation and/or
                submission of claims are trained on the requirements of the relevant
                state
                and Federal health care programs;

            

    

     

    
      	
               

            	
              e.

            	
              measures
                to ensure that Maximus has adequate quality assurance oversight of
                any
                Covered Person engaged in the preparation and/or submission of claims
                to
                any Federal health care programs;
                and

            

    

     

    
      	
               

            	
              f.

            	
              measures
                designed to meet the requirements of Section 6032 of the Deficit
                Reduction
                Act.

            

    

     

    Within
      90
      days after the Effective Date, the relevant portions of the Policies and
      Procedures shall be distributed to all individuals whose job functions relate
      to
      those Policies and Procedures. Appropriate and knowledgeable staff shall be
      available to explain the Policies and Procedures.

     

    At
      least
      annually (and more frequently, if appropriate), Maximus shall assess and update,
      as necessary, the Policies and Procedures. Within 30 days after the effective
      date of any revisions, the relevant portions of any such revised Policies and
      Procedures shall be distributed to all individuals whose job functions relate
      to
      those Policies and Procedures.

     

    C.
      Training and Education.

     

    1.
General
      Training.
Maximus shall provide at least two hours of General Training to
      each
      Relevant Covered Person within 90 days after the Effective Date.
      Maximus shall provide at least one hour of General Training to other Covered
      Person within 150 days of the Effective Date This training, at a minimum, shall
      explain Maximus’:

     

    
      
        
        

      

      
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              a.

            	
              CIA
                requirements; and

            

    

     

    
      	
            	
              b.

            	
              Maximus’
                Compliance Program (including the Code of Conduct and the Policies
                and
                Procedures as they pertain to general compliance
                issues).

            

    

     

    New
      Covered Persons shall receive the General Training described above within 30
      days after becoming a Covered Person or within 90 days after the Effective
      Date,
      whichever is later. After receiving the initial General Training described
      above, each Covered Person shall receive at least one hour of General Training
      in each subsequent Reporting Period.

     

    2.
Specific
      Training.
Within 90 days after the Effective Date, each Relevant Covered
      Person shall receive at least four hours of Specific Training in addition to
      the
      General Training required above. Up to two hours of training with respect to
      quality assurance and contract oversight procedures conducted on or after
      January 1, 2007 through and including the CIA Effective date can count toward
      this training requirement. This Specific Training shall include a discussion
      of:

     

    
      	
            	
              a.

            	
              Maximus’
                policies and procedures about quality
                assurance;

            

    

     

    
      	
            	
              b.

            	
              Maximus’
                consulting contract oversight
                requirements;

            

    

     

    
      	
            	
              c.

            	
              Maximus’
                commitment to adhere to professional and ethical standards of conduct
                for
                consultants;

            

    

     

    
      	
            	
              d.

            	
              the
                Federal health care program requirements regarding the accurate coding
                and
                submission of claims;

            

    

     

    
      	
            	
              e.

            	
              policies,
                procedures, and other requirements applicable to the documentation
                requirements;

            

    

     

    
      	
            	
              f.

            	
              the
                personal obligation of each individual involved in the claims submission
                process to ensure that such claims are
                accurate;

            

    

     

    
      
        
        

      

      
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              g.

            	
              applicable
                reimbursement statutes, regulations, and program requirements and
                directives;

            

    

     

    
      	
            	
              h.

            	
              the
                legal sanctions for violations of the Federal health care program
                requirements; and

            

    

     

    
      	
            	
              i.

            	
              examples
                of proper and improper claims submission
                practices.

            

    

     

    New
      Relevant Covered Persons shall receive this training within 60 days after the
      beginning of their employment or becoming Relevant Covered Persons, or within
      90
      days after the Effective Date, whichever is later. A Maximus employee who has
      completed the Specific Training shall review a new Relevant Covered Person’s
      work, to the extent that the work relates to the delivery of patient care items
      or services and/or the preparation or submission of claims for reimbursement
      from any Federal health care program, until such time as the new Relevant
      Covered Person completes his or her Specific Training.

     

    After
      receiving the initial Specific Training described in this Section, each Relevant
      Covered Person shall receive at least 3 hours of Specific Training in each
      subsequent Reporting Period.

     

    3.           Certification.
      Each individual who is required to attend training shall certify, in
      writing, or in electronic form, if applicable, that he or she has received
      the
      required training. The certification shall specify the type of training received
      and the date received. The Compliance Officer (or designee) shall retain the
      certifications, along with all course materials. These shall be made available
      to OIG, upon request.

     

    4.           Qualifications
      of Trainer. Persons providing the training shall be knowledgeable about the
      subject area.

     

    5.           Update
      of Training. Maximus shall review the training annually, and, where
      appropriate, update the training to reflect changes in Federal health care
      program requirements, any issues discovered during internal audits or the
      Consulting Contract Review and any other relevant information.

     

    6.           Computer-based
      Training. Maximus may provide the training required under this CIA through
      appropriate computer-based training approaches. If Maximus chooses to provide
      computer-based training, it shall make available appropriately qualified
      and knowledgeable staff or trainers to answer questions or provide additional
      information to the individuals receiving such training.

     

    
      
        
        

      

      
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    D.
      Review Procedures.

     

    1.           General
      Description.

     

    a.           OIG
      Office of Audit Services (OAS). The OIG Office of Audit Services (OAS)
      shall perform a Consultant Contract Review and Claims Review. Maximus will
      reimburse OAS at the applicable annual hourly reimbursement rate (e.g. for
      FY
      2007 that rate is $100.41). Maximus will pay all OAS invoices within 30 days
      of
      the receipt of an invoice.

     

    b.           Frequency
      of Claims Review. The Claims Review shall be performed annually and shall
      cover each of the Reporting Periods. The OAS shall perform all components of
      each annual Claims Review.

     

    c.           Retention
      of Records. OAS and Maximus shall retain and make available to the Office
      of Counsel to the Inspector General (OCIG), upon request, all work papers,
      supporting documentation, correspondence, and draft reports related to the
      reviews.

     

    2.           Consulting
      Con tract Review. The Consulting Contract Review shall include a Contract
      Compliance Review and a Claims Review.

     

    
      a.
        Contract Compliance Review. Within 60 days of the end of the first
        Reporting Period, Maximus will provide OAS with a list of all consulting
        contracts or financial arrangements that relate in any way to Federal health
        care programs under which Maximus worked during the Reporting Period. For
        each
        contract or financial relationship, Maximus will identify: (1) the date of
        the
        contract or task order; (2) the parties to the contract or arrangement
        (“Client(s)”); (3) a brief description of the scope of work; (4) whether Maximus
        was paid on a contingency fee basis during the reporting period; (5) whether
        Maximus prepared and/or submitted claims for reimbursement under any Federal
        health care program under the contract; (6) the total amount of Maximus’
        revenues based on the contract.

    

    
       

      
        
          
          

        

        
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      b.
        OAS
        shall select a sample of 10% (or a minimum of 5 and a maximum of 15) of the
        contracts that involve or relate to claiming under federal healthcare programs
        to review (“Sample Contracts”). OAS shall also ensure that no more than one
        Sample Contract involves or relates to audit preparation services.

       

    

    c. For
      each of the Sample Contracts, OAS shall:

     

    
      
        	
              	
                1.

              	
                Review
                  terms of the contract (i.e. number of Federal revenue maximization
                  initiatives included);

              

      

      
        	
              	
                2.

              	
                Review
                  the criteria for the Federal program(s) involved;
                  

              

      

      
        	
              	
                3.

              	
                Obtain
                  the methodology used to determine the costs claimed;
                  and

              

      

      
        	
              	
                4.

              	
                Determine
                  if the methodology is in accordance with Federal and State
                  requirements.

              

      

    

     

    3.
Claims
      Review. OAS shall
      select minimum of 3 and a maximum 10 Sample Contracts on which to perform a
      Claims Review as follows:

     

    
      	
            	
              a.

            	
              For
                each of the Sample Claim Contracts, OAS shall randomly select and
                review a
                sample of 50 claims submitted by
                Maximus;

            

    

    
      	
            	
              b.

            	
              OAS
                shall determine whether the claims were correctly coded, submitted,
                and
                reimbursed based on review of supporting
                documentation.

            

    

    
      	
            	
              c.

            	
              Systems
                Review. If
                Maximus’ Claims Review identifies an
                Error

            

    

     

    Rate
      of 5%
      or greater, OAS shall also conduct a Systems Review. Specifically, for each
      claim in the Claims Review that resulted in an Overpayment, OAS shall perform
      a
“walk through” of the system(s) and process(es), that generated the claim to
      identify any problems or weaknesses that may have resulted in the identified
      Overpayments. OAS shall provide its observations and recommendations on
      suggested improvements to the system(s) and the process(es) that generated
      the
      claim.

     

    
      
        
        

      

      
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    4.  Notification
      to Parties Affected by Results of Consulting Con tract Review. In
      accordance with Section III.H. 1, Maximus shall notify in writing within 30
      days
      the Client and the appropriate representative of the relevant state and/or
      federal health care program affected by the results of the Consulting Contract
      Review. If the Client is affected by the results of the claims review, Maximus’
notification will include a quantification of the potential overpayment. Maximus
      shall make available to OIG all documentation that reflects Maximus compliance
      with this section. Nothing in this Agreement will affect any rights of any
      Client of Maximus to review and appeal with the affected federal health care
      program any potential overpayment identified by the OAS audit.

     

    5.  Claims
      Review Report. OAS shall prepare a report based upon the Consulting
      Contract Review.

     

    E.
      Disclosure Program.

     

    Within
      90
      days after the Effective Date, Maximus shall establish a Disclosure Program
      that
      includes a mechanism (e.g., a toll-free compliance telephone line) to
      enable individuals to disclose, to the Compliance Officer or some other person
      who is not in the disclosing individual’s chain of command, any identified
      issues or questions associated with Maximus’ policies, conduct, practices, or
      procedures with respect to a Federal health care program believed by the
      individual to be a potential violation of criminal, civil, or administrative
      law. Maximus shall appropriately publicize the existence of the disclosure
      mechanism (e.g., via periodic e-mails to employees or by posting the
      information in prominent common areas).

     

    The
      Disclosure Program shall emphasize a nonretribution, nonretaliation policy,
      and
      shall include a reporting mechanism for anonymous communications for which
      appropriate confidentiality shall be maintained. Upon receipt of a disclosure,
      the Compliance Officer (or designee) shall gather all relevant information
      from
      the disclosing individual. The Compliance Officer (or designee) shall make
      a
      preliminary, good faith inquiry into the allegations set forth in every
      disclosure to ensure that he or she has obtained all of the information
      necessary to determine whether a further review should be conducted. For any
      disclosure that is sufficiently specific so that it reasonably: (1) permits
      a determination of the appropriateness of the alleged improper practice; and
      (2)
      provides an opportunity for taking corrective action, Maximus shall conduct
      an
internal
      review of the allegations set forth in the disclosure and ensure that proper
      follow-up is conducted.

     

    
      
        
        

      

      
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    The
      Compliance Officer (or designee) shall maintain a disclosure log, which shall
      include a record and summary of each disclosure received (whether anonymous
      or
      not), the status of the respective internal reviews, and any corrective action
      taken in response to the internal reviews. The disclosure log shall be made
      available to OIG upon request.

     

    F.
      Ineligible Persons.

     

    1.           Definitions.
For
      purposes of this CIA:

     

    a.
      an
“Ineligible Person” shall include an individual or entity who:

     

    i.           is
      currently excluded, debarred, suspended, or otherwise ineligible to participate
      in the Federal health care programs or in Federal procurement or nonprocurement
      programs; or

     

    ii.           has
      been convicted of a criminal offense that falls within the ambit of 42 U.S.C.
§
1320a-7(a), but has not yet been excluded, debarred, suspended, or otherwise
      declared ineligible.

     

    b.
      “Exclusion Lists” include:

     

    i.           the
      HHS/OIG List of Excluded Individuals/Entities (available through the Internet
      at
http://www.oig.hhs.gov); and

     

    ii.           the
      General Services Administration’s List of Parties Excluded from Federal Programs
      (available through the Internet at
http://www.epls.gov).

     

    c.
      “Screened Persons” include officers, directors, employees, contractors, and
      agents of Maximus.

     

    2.          
      Screening Requirements. Maximus shall ensure that all Screened Persons are
      not Ineligible Persons, by implementing the following screening
      requirements.

     

    
      
        
        

      

      
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    a. Maximus
      shall screen all Screened Persons against the Exclusion Lists prior to engaging
      their services and, as part of the hiring or contracting process, shall require
      such Screened Persons to disclose whether they are Ineligible
      Persons.

     

    b. Maximus
      shall screen all Screened Persons against the Exclusion Lists within 90 days
      after the Effective Date and on an annual basis thereafter.

     

    c. Maximus
      shall implement a policy requiring all Screened Persons to disclose immediately
      any debarment, exclusion, suspension, or other event that makes that person
      an
      Ineligible Person.

     

    d. Maximus
      will include in all future contacts a requirement that Contractors who perform
      functions for Maximus that relate to or affect claiming to federal healthcare
      programs screen personnel against the Exclusion Lists prior to allowing
      personnel to work on Maximus projects that relate to claiming under federal
      health care programs.

     

    Nothing
      in
      this Section affects the responsibility of (or liability for) Maximus to refrain
      from billing Federal health care programs for items or services furnished,
      ordered, or prescribed by an Ineligible Person. Maximus understands that items
      or services furnished by excluded persons are not payable by Federal health
      care
      programs and that Maximus may be liable for overpayments and/or criminal, civil,
      and administrative sanctions for employing or contracting with an excluded
      person regardless of whether Maximus meets the requirements of Section
      III.F.

     

    3.
Removal
      Requirement. If
      Maximus has actual notice that a Screened Person has become an Ineligible
      Person, Maximus shall remove such Screened Person from responsibility for,
      or
      involvement with, Maximus’ business operations related to the Federal health
      care programs and shall remove such Screened Person from any position for which
      the Screened Person’s compensation or the items or services furnished, ordered,
      or prescribed by the Screened Person are paid in whole or part, directly or
      indirectly, by Federal health care programs or otherwise with Federal funds
      at
      least until such time as the Screened Person is reinstated into participation
      in
      the Federal health care programs.

     

    
      
        
        

      

      
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    4. Notification
      of Affected Parties of Ineligible Person: If Maximus has actual notice of
      that it has employed an Ineligible Person, Maximus will notify in writing within
      30 days any person or entity who has submitted or will likely submit claims
      to
      any Federal health care program for work performed by the Ineligible Person
      on
      behalf of Maximus.

     

    5. Pending
      Charges and Proposed Exclusions. If Maximus has actual notice that a
      Screened Person is charged with a criminal offense that falls within the ambit
      of 42 U.S.C. §§ 1320a-7(a), 1320a-7(b)(1)-(3), or is proposed for exclusion
      during the Screened Person’s employment or contract term, Maximus shall take all
      appropriate actions to ensure that the responsibilities of that Screened Person
      have not and shall not adversely affect the quality of care rendered to any
      beneficiary, patient, or resident, or the accuracy of any claims submitted
      to
      any Federal health care program.

     

    G. Notification
      of Government Investigation or Legal Proceedings.

     

    Within
      30
      days after discovery, Maximus shall notify OIG, in writing, of any ongoing
      investigation or legal proceeding known to Maximus conducted or brought by
      a
      governmental entity or its agents involving an allegation that Maximus has
      committed a crime or has engaged in fraudulent activities. This notification
      shall include a description of the allegation, the identity of the investigating
      or prosecuting agency, and the status of such investigation or legal proceeding.
      Maximus shall also provide written notice to OIG within 30 days after the
      resolution of the matter, and shall provide OIG with a description of the
      findings and/or results of the investigation or proceedings, if
      any.

     

    H. Reporting.

     

    1.
      Notification of Affected Parties of Potential Problems with Consulting
      Con
      tract.

     

    a.
      Definition of Potential Problems with Consulting Con tract. For
      purposes of this CIA, an “Potential Problems with Consulting Contract” shall
      mean information that would lead a reasonable person to believe that entities
      for whom Maximus has performed work under a consulting contract have, based
      on
      recommendations or work done by Maximus representatives, submitted claims that
      are not reimbursable under the applicable legal and regulatory provisions of
      a
      federal healthcare program.

     

    
      
        
        

      

      
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    b.
      Reporting of Potential Problems with Consulting Con tract. If, at any
      time, Maximus identifies or learns of any Potential Problem with a Consulting
      Contract, Maximus shall notify the Client and the appropriate representative
      of
      the relevant state and/or federal health care program of the potential problem
      and take remedial steps where possible within 60 days after identification
      (or
      such additional time as may be agreed to by the appropriate representative
      of
      the relevant federal health care program) to correct the problem In addition,
      within 60 days after identification, Maximus will undertake a review to
      determine any other contracts that are affected by the issue identified and
      notify the Client(s) and the appropriate representative of the relevant state
      and/or federal health care program of the issue.

     

    2.
      Reportable Events.

     

    a.  Definition
      of Reportable Event. For purposes of this CIA, a “Reportable Event” means
      anything that involves:

     

    i. the
      Reporting of Potential Problems with Consulting Con tract that
      will likely result in a substantial financial impact;

     

    ii. a
      matter that a reasonable person would consider a probable violation by Maximus
      of criminal, civil, or administrative laws applicable to any Federal health
      care
      program for which penalties or exclusion may be authorized; or

     

    iii. the
      filing of a bankruptcy petition by Maximus; A
      Reportable Event may be the result of an isolated event or a series of
      occurrences.

     

    b. 
      Reporting of Reportable Events. If Maximus determines (after a
      reasonable opportunity to conduct an appropriate review or investigation of
      the
      allegations including consultation with the Client) through any means that
      there
      is a Reportable Event, Maximus shall notify OIG, in writing, within 30 days
      after making the determination that the Reportable Event exists. The report
      to
      OIG shall include the following information:

     

    
      
        
        

      

      
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    i. If
      the Reportable Event is Potential Problem with a Consulting Contract , the
      report to OIG shall be made at the same time as the notification to the affected
      party as required in Section III.H.1, and shall include the affected party’s
      name, address, and contact person to whom the Notification was
      sent;

     

    ii. a
      complete description of the Reportable Event, including the relevant facts,
      persons involved, and legal and Federal health care program authorities
      implicated;

     

    iii. a
      description of Maximus’ actions taken to correct the Reportable Event;
      and

     

    iv. any
      further steps Maximus plans to take to address the Reportable Event and prevent
      it from recurring.

     

    v.  If
      the Reportable Event involves the filing of a bankruptcy petition, the report
      to
      the OIG shall include documentation of the filing.

     

    IV.           NEW
BUSINESS
UNITS
      OR LOCATIONS

     

    In
      the
      event that, after the Effective Date, Maximus changes locations or sells,
      closes, purchases, or establishes a new business unit or location related to
      the
      furnishing of items or services that may be reimbursed by Federal health care
      programs, Maximus shall notify OIG of this fact as soon as possible, but no
      later than within 30 days after the date of change of location, sale, closure,
      purchase, or establishment. This notification shall include the address of
      the
      new business unit or location, phone number, fax number, each new business
      unit
      or location shall be subject to all the requirements of this CIA.

     

    V.           IMPLEMENTATION
      AND
ANNUAL
      REPORTS

     

    A.
      Implementation Report. Within 120 days after the Effective Date, Maximus
      shall submit a written report to OIG summarizing the status of its
      implementation of the requirements of this CIA (Implementation Report). The
      Implementation Report shall, at a minimum, include:

     

    
      
        
        

      

      
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    1.  the
      name, address, phone number, and position description of the Compliance Officer
      required by Section III.A, and a summary of other noncompliance job
      responsibilities the Compliance Officer may have;

     

    2.  the
      names and positions of the members of the Compliance Committee required by
      Section III.A;

     

    3.  a
      copy of Maximus’ Code of Conduct required by Section III.B.1;

     

    4.  a
      copy of all Policies and Procedures required by Section III.B.2;

     

    5.  the
      number of individuals required to complete the Code of Conduct certification
      required by Section III.B. 1, the percentage of individuals who have completed
      such certification, and an explanation of any exceptions (the documentation
      supporting this information shall be available to OIG, upon
      request);

     

    6.  the
      following information regarding each type of training required by Section
      III.C:

     

    a. 
a
      description of such training, including a summary of the topics covered, the
      length of sessions and a schedule of training sessions;

     

    b. 
      the number of individuals required to be trained, percentage of individuals
      actually trained, and an explanation of any exceptions.

     

    A
      copy of
      all training materials and the documentation supporting this information shall
      be available to OIG, upon request.

     

    7.  a
      description of the Disclosure Program required by Section III.E;

     

    8.  a
      description of the process by which Maximus fulfills the requirements of Section
      III.F regarding Ineligible Persons;

     

    9.  the
      name, title, and responsibilities of any person who is determined to be an
      Ineligible Person under Section III.F; the actions taken in response to the
      screening and removal obligations set forth in Section III.F; and the actions
      taken to notify the State or governmental entity for which the ineligible person
      performed work on behalf of Maximus;

     

    
      
        
        

      

      
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    10.
      a list
      of all of Maximus’ locations (including locations and mailing addresses); the
      corresponding name under which each location is doing business; the
      corresponding phone numbers and fax numbers;

     

    11. a
      description of Maximus’ corporate structure, including
      identification of any parent and sister companies, subsidiaries, and their
      respective lines of business; and

     

    12. the
      certifications required by Section V.C.

     

    B.
      Annual Reports. Maximus shall submit to OIG annually a report with
      respect to the status of, and findings regarding, Maximus’ compliance activities
      for each of the five Reporting Periods (Annual Report).

     

    Each
      Annual Report shall include, at a minimum:

     

    1.  any
      change in the identity, position description, or other noncompliance job
      responsibilities of the Compliance Officer and any change in the membership
      of
      the Compliance Committee described in Section III.A;

     

    2.  a
      summary of any significant changes or amendments to the Policies and Procedures
      required by Section III.B and the reasons for such changes (e.g., change
      in contractor policy);

     

    3.  the
      number of individuals required to complete the Code of Conduct certification
      required by Section III.B. 1, the percentage of individuals who have completed
      such certification, and an explanation of any exceptions (the documentation
      supporting this information shall be available to OIG, upon
      request);

     

    4.  the
      following information regarding each type of training required by Section
      III.C:

     

    a.  a
      description of such training, including a summary of the topics covered, the
      length of sessions and a schedule of training sessions;

     

    b.  the
      number of individuals required to be trained, percentage of individuals actually
      trained, and an explanation of any exceptions.

     

    
      
        
        

      

      
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    A
      copy of
      all training materials and the documentation supporting this information shall
      be available to OIG, upon request.

     

    5.  a
      complete copy of all reports prepared pursuant to Section III.D, along with
      a
      copy of the OAS’s engagement letter (if applicable);

     

    6.  Maximus’
      response and corrective action plan(s) related to any issues raised by the
      reports prepared pursuant to Section III.D;

     

    7.  a
      summary of Reportable Events (as defined in Section III.H) identified during
      the
      Reporting Period and the status of any corrective and preventative action
      relating to all such Reportable Events;

     

    8.  a
      report of the aggregate Notifications of Potential Problems with Consulting
      Contracts broken down into the following categories: State or governmental
      entity(s); description of cause for problem; and other states or governmental
      entity(s) with same or similar methodology.

     

    9.  a
      summary of the disclosures in the disclosure log required by Section III.E
      that
      relate to Federal health care programs.

     

    10.
      any
      changes to the process by which Maximus fulfills the requirements of Section
      III.F regarding Ineligible Persons;

     

    11. the
      name, title, and responsibilities of any person who is determined to be an
      Ineligible Person under Section III.F; the actions taken by Maximus in response
      to the screening and removal obligations set forth in Section III.F; and the
      actions taken to notify all states or governmental entity(s) under whose
      contract the Ineligible Person performed work on behalf of Maximus;

     

    12. a
      summary describing any ongoing investigation or legal proceeding required to
      have been reported pursuant to Section III.G. The summary shall include a
      description of the allegation, the identity of the investigating or prosecuting
      agency, and the status of such investigation or legal proceeding;

     

    13. a
      description of all changes to the most recently provided list of Maximus’
locations (including addresses) as required by Section V.A.12; the corresponding
      name under which each location is doing business; the corresponding phone
      numbers and fax numbers;

    

    
      
        
        

      

      
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    14.
      the
      certifications required by Section V.C.

     

    The
      first
      Annual Report shall be received by OIG no later than 60 days after the end
      of
      the first Reporting Period. Subsequent Annual Reports shall be received by
      OIG
      no later than the anniversary date of the due date of the first Annual
      Report.

     

    C.  Certifications.
      The Implementation Report and Annual Reports shall include a certification
      by
      the Compliance Officer that:

     

    1.  to
      the best of his or her knowledge, except as otherwise described in the
      applicable report, Maximus is in compliance with all of the requirements of
      this
      CIA;

     

    2.  he
      or she has reviewed the Report and has made reasonable inquiry regarding its
      content and believes that the information in the Report is accurate and
      truthful; and

     

    D.  Designation
      of Information. Maximus shall clearly identify any portions of its
      submissions that it believes are trade secrets, or information that is
      commercial or financial and privileged or confidential, and therefore
      potentially exempt from disclosure under the Freedom of Information Act (FOIA),
      5 U.S.C. § 552. Maximus shall refrain from identifying any information as exempt
      from disclosure if that information does not meet the criteria for exemption
      from disclosure under FOIA.

     

    VI.
NOTIFICATIONS
      AND
SUBMISSION
      OF
REPORTS

     

    Unless
      otherwise stated in writing after the Effective Date, all notifications and
      reports required under this CIA shall be submitted to the following
      entities:

     

    OIG:

    Administrative
      and Civil Remedies Branch

    Office
      of
      Counsel to the Inspector General

    Office
      of
      Inspector General

    U.S.
      Department of Health and Human Services

    Cohen
      Building, Room 5527

    330
      Independence Avenue, S.W.

    Washington,
      DC 20201

    Telephone:
      202.619.2078

    Facsimile:
      202.205.0604

    

    
      
        
        

      

      
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    Maximus:

    Adelaide
      Mayhew

    MAXIMUS,
      Inc.

    1356
      Beverly Road

    McLean,
      Virginia 22101

    Fax
      (703)
      251-8240

     

    Unless
      otherwise specified, all notifications and reports required by this CIA may
      be
      made by certified mail, overnight mail, hand delivery, or other means, provided
      that there is proof that such notification was received. For purposes of this
      requirement, internal facsimile confirmation sheets do not constitute proof
      of
      receipt.

     

    VII.          OIG
      INSPECTION,
AUDIT,
      AND
REVIEW
      RIGHTS

     

    In
      addition to any other rights OIG may have by statute, regulation, or contract,
      OIG or its duly authorized representative(s) may examine or request copies
      of
      Maximus’ books, records, and other documents and supporting materials and/or
      conduct on-site reviews of any of Maximus’ locations for the purpose of
      verifying and evaluating: (a) Maximus’ compliance with the terms of this CIA;
      and (b) Maximus’ compliance with the requirements of the Federal health care
      programs in which it participates. The documentation described above shall
      be
      made available by Maximus to OIG or its duly authorized representative(s) at
      all
      reasonable times for inspection, audit, or reproduction. Furthermore, for
      purposes of this provision, OIG or its duly authorized representative(s) may
      interview any of Maximus’ employees, contractors, or agents who consent to be
      interviewed at the individual’s place of business during normal business hours
      or at such other place and time as may be mutually agreed upon between the
      individual and OIG. Maximus shall assist OIG or its duly authorized
      representative(s) in contacting and arranging interviews with such individuals
      upon OIG’s request. Maximus’ employees may elect to be interviewed with or
      without a representative of Maximus present.

     

    VIII.         DOCUMENT
      AND RECORD
RETENTION

     

    Maximus
      shall maintain for inspection all documents and records relating to work
      performed under a contract that relates to reimbursement from the Federal health
      care programs, or to compliance with this CIA, for 6 years (or longer if
      otherwise required by law) from the Effective Date.

     

    
      
        
        

      

      
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    IX.           DISCLOSURES

     

    Consistent
      with HHS’s FOIA procedures, set forth in 45 C.F.R. Part 5, OIG shall make a
      reasonable effort to notify Maximus prior to any release by OIG of information
      submitted by Maximus pursuant to its obligations under this CIA and identified
      upon submission by Maximus as trade secrets, or information that is commercial
      or financial and privileged or confidential, under the FOIA rules. With respect
      to such releases, Maximus shall have the rights set forth at 45 C.F.R. §
5.65(d).

     

    X.           BREACH
      AND DEFAULT
PROVISIONS

     

    Maximus
      is
      expected to fully and timely comply with all of its CIA
      obligations.

     

    A.
      Stipulated Penalties for Failure to Comply with Certain Obligations. As a
      contractual remedy, Maximus and OIG hereby agree that failure to comply with
      certain obligations as set forth in this CIA may lead to the imposition of
      the
      following monetary penalties (hereinafter referred to as “Stipulated Penalties”)
      in accordance with the following provisions.

     

    1.
      A
      Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
      the
      date the obligation became due) for each day Maximus fails to establish and
      implement any of the following obligations as described in Section
      III:

     

    a.  a
      Compliance Officer;

     

    b.  a
      Compliance Committee;

     

    c.  a
      written Code of Conduct;

     

    d.  written
      Policies and Procedures;

     

    e.  the
      training of Covered Persons;

     

    f.  a
      Disclosure Program;

     

    g.  Ineligible
      Persons screening and removal requirements; and

     

    h.  notification
      of Government investigations or legal proceedings.

     

    
      
        
        

      

      
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    2. A
      Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
      the
      date the obligation became due) for each day Maximus fails to pay an invoice
      of
      OAS within 30 days of the receipt from OAS as required in Section
      III.D.

     

    3. A
      Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
      the
      date the obligation became due) for each day Maximus fails to submit the
      Implementation Report or any Annual Reports to OIG in accordance with the
      requirements of Section V by the deadlines for submission.

     

    4. A
      Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
      the
      date the obligation became due) for each day Maximus fails to notify affected
      parties of a Potential Problem with Consulting Contract in accordance with
      requirements of Section III.H

     

    5. A
      Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
      the
      date the obligation became due) for each day Maximus fails to submit the annual
      Consulting Contract Review in accordance with the requirements of Section
      III.D.

     

    6. A
      Stipulated Penalty of $1,500 for each day Maximus fails to grant access as
      required in Section VII. (This Stipulated Penalty shall begin to accrue on
      the
      date Maximus fails to grant access.)

     

    7. A
      Stipulated Penalty of $5,000 for each false certification submitted by or on
      behalf of Maximus as part of its Implementation Report, Annual Report,
      additional documentation to a report (as requested by the OIG), or otherwise
      required by this CIA.

     

    8. A
      Stipulated Penalty of $1,000 for each day Maximus fails to comply fully and
      adequately with any obligation of this CIA. OIG shall provide notice to Maximus
      stating the specific grounds for its determination that Maximus has failed
      to
      comply fully and adequately with the CIA obligation(s) at issue and steps
      Maximus shall take to comply with the CIA. (This Stipulated Penalty shall begin
      to accrue 10 days after Maximus receives this notice from OIG of the failure
      to
      comply.) A Stipulated Penalty as described in this Subsection shall not be
      demanded for any violation for which OIG has sought a Stipulated Penalty under
      Subsections 1-6 of this Section.

     

    B.
      Timely Written Requests for Extensions. Maximus may, in advance of the
      due date, submit a timely written request for an extension of time to perform
      any act or file any notification or report required by this CIA. Notwithstanding
      any other provision in this Section, if OIG grants the timely written request
      with respect to an act, notification, or
      report,
      Stipulated Penalties for failure to perform the act or file the notification
      or
      report shall not begin to accrue until one day after Maximus fails to meet
      the
      revised deadline set by OIG. Notwithstanding any other provision in this
      Section, if OIG denies such a timely written request, Stipulated Penalties
      for
      failure to perform the act or file the notification or report shall not begin
      to
      accrue until three business days after Maximus receives OIG’s written denial of
      such request or the original due date, whichever is later. A “timely written
      request” is defined as a request in writing received by OIG at least five
      business days prior to the date by which any act is due to be performed or
      any
      notification or report is due to be filed.

     

    
      
        
        

      

      
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    C.
      Payment of Stipulated Penalties.

     

    1.  Demand
      Letter. Upon a finding that Maximus has failed to comply with any of the
      obligations described in Section X.A and after determining that Stipulated
      Penalties are appropriate, OIG shall notify Maximus of: (a) Maximus’ failure to
      comply; and (b) OIG’s exercise of its contractual right to demand payment of the
      Stipulated Penalties (this notification is referred to as the “Demand
      Letter”).

     

    2.  Response
      to Demand Letter. Within 10 days after the receipt of the Demand Letter,
      Maximus shall either: (a) cure the breach to OIG’s satisfaction and pay the
      applicable Stipulated Penalties or (b) request a hearing before an HHS
      administrative law judge (ALJ) to dispute OIG’s determination of noncompliance,
      pursuant to the agreed upon provisions set forth below in Section X.E. In the
      event Maximus elects to request an ALJ hearing, the Stipulated Penalties shall
      continue to accrue until Maximus cures, to OIG’s satisfaction, the alleged
      breach in dispute. Failure to respond to the Demand Letter in one of these
      two
      manners within the allowed time period shall be considered a material breach
      of
      this CIA and shall be grounds for exclusion under Section X.D.

     

    3.  Form
      of Payment. Payment of the Stipulated Penalties shall be made by certified
      or cashier’s check, payable to: “Secretary of the Department of Health and Human
      Services,” and submitted to OIG at the address set forth in Section
      VI.

     

    4.  Independence
      from Material Breach Determination. Except as set forth in Section X.D. 1
      .c, these provisions for payment of Stipulated Penalties shall not affect or
      otherwise set a standard for OIG’s decision that Maximus has materially breached
      this CIA, which decision shall be made at OIG’s discretion and shall be governed
      by the provisions in Section X.D, below.

     

    
      
        
        

      

      
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    D.
      Exclusion for Material Breach of this CIA.

     

    1.
      Definition of Material Breach. A material breach of this CIA
      means:

     

    a.  a
      failure by Maximus to report a Reportable Event, take corrective action, and
      make the appropriate refunds, as required in Section III.H;

     

    b.  a
      repeated or flagrant violation of the obligations under this CIA, including,
      but
      not limited to, the obligations addressed in Section X.A;

     

    c.  a
      failure to respond to a Demand Letter concerning the payment of Stipulated
      Penalties in accordance with Section X.C; or

     

    d.  a
      failure to engage OAS in accordance with Section III.D.

     

    2.
      Notice of Material Breach and Intent to Exclude. The parties agree that
      a material breach of this CIA by Maximus constitutes an independent basis for
      Maximus’ exclusion from participation in the Federal health care programs. Upon
      a determination by OIG that Maximus has materially breached this CIA and that
      exclusion is the appropriate remedy, OIG shall notify Maximus of: (a) Maximus’
material breach; and (b) OIG’s intent to exercise its contractual right to
      impose exclusion (this notification is hereinafter referred to as the “Notice of
      Material Breach and Intent to Exclude”).

     

    3.
      Opportunity to Cure. Maximus shall have 30 days from the date of
      receipt of the Notice of Material Breach and Intent to Exclude to demonstrate
      to
      OIG’s satisfaction that:

     

    a.  Maximus
      is in compliance with the obligations of the CIA cited by OIG as being the
      basis
      for the material breach;

     

    b.  the
      alleged material breach has been cured; or

     

    c.  the
      alleged material breach cannot be cured within the 30-day period, but that:
      (i)
      Maximus has begun to take action to cure the material breach; (ii) Maximus
      is
      pursuing such action with due diligence; and (iii) Maximus has provided to
      OIG a
      reasonable timetable
      for curing the material breach.

     

    
      
        
        

      

      
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    4.
      Exclusion Letter. If, at the conclusion of the 30-day period, Maximus
      fails to satisfy the requirements of Section X.D.3, OIG may exclude Maximus
      from
      participation in the Federal health care programs. OIG shall notify Maximus
      in
      writing of its determination to exclude Maximus (this letter shall be referred
      to hereinafter as the “Exclusion Letter”). Subject to the Dispute Resolution
      provisions in Section X.E, below, the exclusion shall go into effect 30 days
      after the date of Maximus’ receipt of the Exclusion Letter. The exclusion shall
      have national effect and shall also apply to all other Federal procurement
      and
      nonprocurement programs. Reinstatement to program participation is not
      automatic. After the end of the period of exclusion, Maximus may apply for
      reinstatement by submitting a written request for reinstatement in accordance
      with the provisions at 42 C.F.R. §§ 1001.3001-.3004.

     

    E.
      Dispute Resolution

     

    1.  Review
      Rights. Upon OIG’s delivery to Maximus of its Demand Letter or of its
      Exclusion Letter, and as an agreed-upon contractual remedy for the resolution
      of
      disputes arising under this CIA, Maximus shall be afforded certain review rights
      comparable to the ones that are provided in 42 U.S.C. § 1320a-7(f) and 42 C.F.R.
      Part 1005 as if they applied to the Stipulated Penalties or exclusion sought
      pursuant to this CIA. Specifically, OIG’s determination to demand payment of
      Stipulated Penalties or to seek exclusion shall be subject to review by an
      HHS
      ALJ and, in the event of an appeal, the HHS Departmental Appeals Board (DAB),
      in
      a manner consistent with the provisions in 42 C.F.R. § 1005.2-1005.2 1.
      Notwithstanding the language in 42 C.F.R. § 1005.2(c), the request for a hearing
      involving Stipulated Penalties shall be made within 10 days after receipt of
      the
      Demand Letter and the request for a hearing involving exclusion shall be made
      within 25 days after receipt of the Exclusion Letter.

     

    2.  Stipulated
      Penalties Review. Notwithstanding any provision of Title 42 of the United
      States Code or Title 42 of the Code of Federal Regulations, the only issues
      in a
      proceeding for Stipulated Penalties under this CIA shall be: (a) whether Maximus
      was in full and timely compliance with the obligations of this CIA for which
      OIG
      demands payment; and (b) the period of noncompliance. Maximus shall have the
      burden of proving its full and timely compliance and the steps taken to cure
      the
      noncompliance, if any. OIG shall not have the right to appeal to the DAB an
      adverse ALJ decision related to Stipulated Penalties. If the ALJ agrees with OIG
      with regard to a finding of a breach of this CIA and orders Maximus to pay
      Stipulated Penalties, such Stipulated Penalties shall become due and payable
      20
      days after the ALJ issues such a decision unless
      Maximus requests review of the ALJ decision by the DAB. If the ALJ decision
      is
      properly appealed to the DAB and the DAB upholds the determination of OIG,
      the
      Stipulated Penalties shall become due and payable 20 days after the DAB issues
      its decision.

     

    
      
        
        

      

      
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    3.  Exclusion
      Review.
Notwithstanding any provision of Title 42 of the United States
      Code
      or Title 42 of the Code of Federal Regulations, the only issues in a proceeding
      for exclusion based on a material breach of this CIA shall be:

     

    a.  whether
      Maximus was in material breach of this CIA;

     

    b.  whether
      such breach was continuing on the date of the Exclusion Letter; and

     

    c.  whether
      the alleged material breach could not have been cured within the 30-day period,
      but that: (i) Maximus had begun to take action to cure the material breach
      within that period; (ii) Maximus has pursued and is pursuing such action with
      due diligence; and (iii) Maximus provided to OIG within that period a reasonable
      timetable for curing the material breach and Maximus has followed the
      timetable.

     

    For
      purposes of the exclusion herein, exclusion shall take effect only after an
      ALJ
      decision favorable to OIG, or, if the ALJ rules for Maximus, only after a DAB
      decision in favor of OIG. Maximus’ election of its contractual right to appeal
      to the DAB shall not abrogate OIG’s authority to exclude Maximus upon the
      issuance of an ALJ’s decision in favor of OIG. If the ALJ sustains the
      determination of OIG and determines that exclusion is authorized, such exclusion
      shall take effect 20 days after the ALJ issues such a decision, notwithstanding
      that Maximus may request review of the ALJ decision by the DAB. If the DAB
      finds
      in favor of OIG after an ALJ decision adverse to OIG, the exclusion shall take
      effect 20 days after the DAB decision. Maximus shall waive its right to any
      notice of such an exclusion if a decision upholding the exclusion is rendered
      by
      the ALJ or DAB. If the DAB finds in favor of Maximus, Maximus shall be
      reinstated effective on the date of the original exclusion.

     

    4.  Finality
      of Decision.
The review by an ALJ or DAB provided for above shall not be
      considered to be an appeal right arising under any statutes or regulations.
      Consequently, the parties to this CIA agree that the DAB’s decision (or the
      ALJ’s decision if not appealed) shall be considered final for all purposes under
      this CIA.

    

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    XI.          
      EFFECTIVE
      AND BINDING
      AGREEMENT

     

    Maximus
      and OIG agree as follows:

     

    A.  This
      CIA shall be binding on the successors, assigns, and transferees of
      Maximus;

     

    B.   This
      CIA shall become final and binding on the date the final signature is obtained
      on the CIA;

     

    C.   This
      CIA constitutes the complete agreement between the parties and may not be
      amended except by written consent of the parties to this CIA;

     

    D.   OIG
      may agree to a suspension of Maximus’ obligations under the CIA in the event of
      Maximus’ cessation of participation in Federal health care programs. If Maximus
      withdraws from participation in Federal health care programs and is relieved
      of
      its CIA obligations by OIG, Maximus shall notify OIG at least 30 days in advance
      of Maximus’ intent to reapply as a participating provider or supplier with any
      Federal health care program. Upon receipt of such notification, OIG shall
      evaluate whether the CIA should be reactivated or modified.

     

    E.   The
      undersigned Maximus signatories represent and warrant that they are authorized
      to execute this CIA. The undersigned OIG signatory represents that he is signing
      this CIA in his official capacity and that he is authorized to execute this
      CIA.

     

    F.    This
      CIA may be executed in counterparts, each of which constitutes an original
      and
      all of which constitute one and the same CIA. Facsimiles of signatures shall
      constitute acceptable, binding signatures for purposes of this CIA.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    ON
      BEHALF
      OF MAXIMUS

     

     

     

    
      	
              /s/
                DAVID R. FRANCIS

            	 	 	July
              20, 2007	 
	
              DAVID
                R. FRANCIS

              General
                Counsel and Secretary

              MAXIMUS,
                Inc.

            	 	 	DATE	 

    

     

     

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    
      ON
        BEHALF OF THE OFFICE OF INSPECTOR GENERAL

      OF
        THE DEPARTMENT OF HEALTH AND HUMAN SERVICES

       

       

      
        	
                /s/
                  GREGORY E. DEMSKE

              	 	 	7/20/07	 
	
                GREGORY
                  E. DEMSKE

                Assistant
                  Inspector General for Legal Affairs

                Office
                  of Inspector General

                U.S.
                  Department of Health and Human Services

              	 	 	DATE	 

      

       

       

      29a5454983ex10_3.htm

    Exhibit
      10.3

     

    
      

       

      DEFERRED
        PROSECUTION

       

      Maximus,
        Inc., ("Maximus"), a Virginia corporation, by its undersigned attorneys,
        pursuant to authority granted by its Board of Directors, and the United States
        Attorney's Office for the District of Columbia ("the Office"), enter into
        this
        Agreement.

       

      Statement
        of Facts

       

      1.       Maximus
        is a government services company that provides program management, operations,
        and information technology services to State and local governments. Maximus
        has
        more than 5,200 employees in more than 220 offices in North America and
        Australia.

       

      2.       The
        District of Columbia Child and Family Services Agency ("CFSA") is an agency
        of
        the government of the District of Columbia. CFSA's mission is to provide
        services that promote the safety and well-being of children who either are
        placed into foster care or known to CFSA because they have suffered abuse
        and
        neglect.

       

      3.       Targeted
        Case Management ("TCM") is a means of providing specialized case management
        services, such as assessment of client circumstances to identify needed
        services, to a targeted population. By implementing a TCM program, a local
        governmental agency, such as CFSA, can be reimbursed by the Federal government
        for a portion of the costs that it incurs helping individuals obtain access
        to
        specified social services. In the District of Columbia, the Federal government
        reimburses 70% of the costs of providing covered TCM services.

       

      4.       Commencing
        in 1999, Maximus was awarded a contract to provide program management to
        CFSA.
        At the time that Maximus was awarded the CFSA contract, CFSA was in
        court-ordered receivership under the supervision of United States District
        Judge
        Thomas F. Hogan because Judge Hogan had determined that CFSA was providing
        a
        constitutionally inadequate level of services
        to the children for whom it was responsible.

      

       

      
        
           

        

        
          Final
            Page 1

          
            

          

        

        
           

        

         

      

      5.       One
        cause of CFSA's failure to provide adequate services to its constituency
        was a
        chronic lack of money. To remedy this problem, Maximus' contract with CFSA
        provided that Maximus would, on CFSA's behalf, "pursue and obtain additional
        Title XIX Medicaid and other federal revenue for health care and administrative
        costs for children and families receiving services from the CFSA." To this
        end,
        Maximus agreed to develop "a new cost reporting protocol and claiming
        methodology allowing CFSA to receive significantly enhanced Title XIX revenue,"
        an assessment of the billing rates CFSA was using, and modification
        of the State Plan and cost allocation plan to maximize federal participation."
        For its efforts, Maximus was to receive approximately 10% of all federal
        reimbursement revenues that it obtained on behalf of CFSA.

       

      6.       Among
        the financial optimization recommendations that Maximus made for CFSA was
        that
        CFSA implement a TCM program. Maximus caused the District of Columbia State
        Plan
        for medical assistance to be amended to authorize CFSA to receive federal
        reimbursement in connection with a TCM program under which it would provide
        its
        core services to its pre-existing constituency.

       

      7.       Federal
        reimbursement regulations require that TCM claims for reimbursement be supported
        by documentation sufficient to identify the date, type and recipient of the
        service for which reimbursement is sought. Proxies for service documentation,
        such as time studies and cost allocation plans, are not sufficient to support
        a
        claim for a Medicaid service. Maximus knew of these documentation requirements
        and understood that claims for reimbursement could not be submitted without
        complying with these documentation requirements.

       

      
        
           

        

        
          Final
            Page 2

          
            

          

        

        
           

        

      

       

      8.      
        After Maximus began working on behalf of CFSA, Maximus employees quickly
        determined that CFSA could not document the provision of many services and
        certainly could not
        document that it was providing monthly TCM services to each child for which
        it
        was responsible. Maximus knew that CFSA had insufficient documentation of
        TCM
        claims because it had, on several occasions, reviewed CFSA's electronic and
        paper files for the purpose of identifying such documentation and concluded
        that
        the documentation was largely not present. Nonetheless, Maximus employees,
        including a former company vice-president, decided to cause CFSA to claim
        TCM
        reimbursement, on a monthly basis, for each child who had been placed in
        the
        care of CFSA. Stated another way, Maximus caused CFSA to request TCM
        reimbursement as if the files of every child in placement indicated that
        each
        child was receiving a TCM service every month when, as Maximus then well
        knew,
        that was not true. These placement-based claims were submitted without regard
        for whether any services had been performed or whether any services had been
        documented as performed. From July, 1999, through March, 2002, Maximus submitted
        monthly claims for reimbursement of TCM services for every child in placement
        at
        CFS A, regardless of whether the service had been either performed or
        documented.

       

      9.     
         Because of the decision to claim Federal reimbursement based upon
        placement, Maximus caused CFSA to submit 26,863 undocumented claims for Medicaid
        reimbursement. The Federal government sustained a loss of $12.15 million
        due to
        the submission of the undocumented claims. Those claims were ultimately
        withdrawn after a government audit and the prior payments to CFSA were
        adjusted.

       

      10.     Maximus
        continued submitting claims based upon placement until March, 2002, when
        CMS
        conducted an audit of CFSA's TCM claims. During the audit, CMS investigators
        learned that less than half of the sampled claims that Maximus had caused
        CFSA
        to submit possessed supporting documentation. Maximus thereupon, on behalf
        of
        CFSA, withdrew all of the
        claims
        that it previously had submitted on behalf of CFSA. The claims were then
        resubmitted using the services-based methodology.

       

      
        
           

        

        
          Final
            Page 3

          
            

          

        

        
           

        

         

      

      Acceptance
        of Responsibility for Submitting Undocumented Claims

       

      11.      Maximus
        accepts and acknowledges responsibility for its behavior as set forth in
        the
        preceding Statement of Facts by entering into this Agreement and by, among
        other
        things, the extensive remedial actions that it has taken to date, its continuing
        commitment of full cooperation with the Office and other governmental agencies,
        its agreement to pay restitution and substantial monetary fines, and the
        other
        undertakings it has made as set forth herein. Maximus agrees that it will
        not contest the admissibility into evidence of the Statement of Facts
        in
        any subsequent criminal proceedings occurring in the event of breach of this
        Agreement. Maximus agrees that the foregoing Statement of Facts is true and
        accurate.

       

      Deferral
        of Prosecution

       

      12.       The
        United States reserves the right to file an Information (the "Information")
        in
        the United States District Cowl for the District of Columbia charging Maximus
        with a violation of Title 18, United States Code, Section 1347 arising out
        of
        the Statement of Facts recited above. In consideration
        of Maximus' entry into this Agreement and its commitment to (a) accept and
        acknowledge responsibility for its conduct; (h) cooperate with this Office;
        (c)
        make the payment specified in this Agreement; (d) comply with Federal criminal
        laws; and (e) otherwise comply with all of the terms of this Agreement, this
        Office will defer filing the Information for 24 (twenty-four) months following
        the signing of this Agreement. Maximus expressly waives indictment and all
        rights to a speedy trial and to a jury trial pursuant to the Sixth Amendment
        of
        the United States Constitution, Title 18, United States Code, Section 3161,
        Federal Rule of Criminal
        Procedure 48(b), and any applicable Local Rules of the United States District
        Court for the District of Columbia for the period during which this Agreement
        is
        in effect.

       

      
        
           

        

        
          Final
            Page 4

          
            

          

        

        
           

        

      

       

      13.           The
        Office agrees that, if Maximus is in compliance with all of its obligations
        under this Agreement, the Office will, at the expiration of the period of
        deferral (including any extensions thereof), decline to file the Information
        against Maximus. Except in the event of a violation by Maximus of any term
        of
        this Agreement, the Office will bring no additional charges against Maximus
        relating to its development and implementation of a TCM reimbursement
        methodology on behalf of CFSA. In the event of a violation by Maximus of
        any
        teen of this Agreement, this Office may file the Information referred to
        in
        paragraph 12. This Agreement does not provide any protection against prosecution
        for any offenses except as set forth above and does not apply to any individual
        or entity other than Maximus.

       

      14.           Maximus
        expressly agrees that it shall not, through its present or future attorneys,
        board of directors, agents, officers, or management employees, make any public
        statement contradicting any statement of fact contained in the Statement
        of
        Facts. Any such contradictory public statement by Maximus, its present or
        future
        attorneys, board of directors, agents, officers, or management employees
        shall
        constitute a breach of this Agreement, and Maximus would thereafter be subject
        to prosecution pursuant to the terms of this Agreement. The decision of whether
        any public statement by any such person contradicting a fact contained in
        the
        Statement of Facts will be imputed to Maximus for the purpose of determining
        whether Maximus has breached this Agreement shall be at the sole reasonable
        discretion of the Office. Should the Office decide in its sole reasonable
        discretion to no Maximus of a public statement by any such person that in
        whole
        or in part contradicts a statement of fact contained in the Statement of
        Facts,
        Maximus may avoid breach of the Agreement by publicly repudiating such statement
        within 48 hours after such notification.

       

      
        
           

        

        
          Final
            Page 5

          
            

          

        

        
           

        

      

       

      15.           Pursuant
        to a civil settlement, Maximus agrees to pay $30,500,000.00 to the United
        States
        Treasury as more fully set forth in the Settlement Agreement dated July 20,
        2007, by and among the United States of America, acting through the United
        States Department of Justice and on behalf of the Office of the Inspector
        General of the Department of Health and Human Services, relator Benjamin
        Turner,
        and Maximus.

       

      Revised
        ComplianceProgram

       

      16.           Maximus
        has previously adopted a corporate compliance program that sets forth the
        standards by which individuals employed by or associated with Maximus will
        conduct themselves in order to protect and promote organizational integrity,
        and
        to ensure compliance with Federal and state law. To strengthen this program,
        Maximus will revise its compliance program accord with Section 8B2.1 of the
        United States Sentencing Guidelines.

       

      17.           Maximus
        also has agreed to revise and enhance its compliance program and to
        cooperate in periodic reviews of its claiming services under Federal health
        care
        programs as set forth in the Corporate Integrity Agreement dated July 20,
        2007,
        between the Office of the Inspector General of the Department of Health and
        Human Services and Maximus.

       

      Breach
        of the Agreement

       

      18.           In
        the event that the Office, in its sole reasonable discretion, determines
        that
        Maximus has violated any provision of this Agreement, including Maximus'
        failure
        to meet its obligations under this Agreement: (a) all statements made by
        or on
        behalf of Maximus to the Office, including but not limited to the Statement
        of
        Facts, or any testimony given by Maximus or by any agent of Maximus before
        a
        grand jury, or elsewhere, whether before or after the date of this
        Agreement, shall be admissible for the truth of the matter in evidence in
        any
        and all criminal proceedings hereinafter brought by the Office against Maximus;
        and (b) Maximus shall not assert any claim under the United States Constitution,
        Rule of the Federal Rules of Criminal Procedure, Rule 410 of the Federal
        Rules
        of Evidence, or any other Federal rule, that statements made by or on behalf
        of
        Maximus before or after the date of this Agreement, or any leads derived
        therefrom, should be suppressed or otherwise excluded from evidence. It is
        the
        intent of this Agreement to waive any and all rights in the foregoing
        respects.

       

      
        
           

        

        
          Final
            Page 6

          
            

          

        

        
           

        

      

       

      19.         In
        the case of the willful and knowing material breach of this Agreement, any
        prosecution of Maximus relating to the offenses described in the Statement
        of
        Facts that are not time barred by the applicable statute of limitations as
        of
        the date of this Agreement may be commenced against Maximus notwithstanding the
        expiration of any applicable statute of limitations during the deferred
        prosecution period and up to the determination of any such willful and knowingly
        material breach. Maximus' waiver of the statute of limitations is knowing
        and
        voluntary and in express reliance on the advice of counsel.

       

      20.         Maximus
        agrees that, in the event that the Office determines during the period of
        deferral of prosecution described above (or any extensions thereof) that
        Maximus
        violated any provision of this Agreement, a one-year extension of the period
        of
        deferral of prosecution may be imposed in the sole reasonable discretion
        of the
        Office and, in the event of additional violations, such additional one-year
        extensions as appropriate, but in no event shall the total term of the
        deferral-of-prosecution period of this Agreement exceed five years.

       

      The
        Office'sDiscretion

       

      21.         Maximus
        agrees that it is within the Office's sole reasonable discretion to choose,
        in
        the event of a violation, the remedies contained above, or instead to choose
        to
        extend the period of
        deferral of prosecution. Maximus understands and agrees that the exercise
        of the
        Office's discretion under this Agreement is un-reviewable by any court. Should
        the Office determine that Maximus has violated this Agreement, the Office
        shall
        provide notice to Maximus of that determination and provide Maximus with
        an
        opportunity to make a presentation to the Office to demonstrate that no
        violation occurred, or, to the extent applicable, that the violation should
        not
        result in the exercise of those remedies or in an extension of the period
        of
        deferral of prosecution.

       

      
        
           

        

        
          Final
            Page 7

          
            

          

        

        
           

        

      

       

      22.           Maximus
        agrees that DeMaurice F. Smith of Patton Boggs, LLP, its signatory to this
        Agreement, is authorized, pursuant to authority granted by its Board of
        Directors, to enter into this Agreement on behalf of the company.

       

      23.           This
        Agreement may be executed in counterparts, each of which constitutes an original
        and all of which constitute one and the same Agreement.

       

       

      
        	 	7-23-07	 	7-23-07	 
	 	Date	 	Date	 
	 	 	 	 	 
	 	/s/
                DeMaurice F. Smith	 	/s/
                Sarah T. Chasson	 
	 	
                DeMaurice
                  F. Smith

                Patton
                  Boggs, LLP

                Representative
                  for Maximus 

              	 	
                Sarah
                  T. Chasson

                Assistant
                  United States Attorney

                District
                  of Columbia

              	 
	 	 	 	 	 
	 	 	 	 	 

      

       

       

      Final
        Page
        8

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