Document:

exv10w20w7

Exhibit 10.20.7

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

Part 1: Parties to the Contract:

This Contract Amendment (the “Amendment”) is between the Texas Health and Human Services Commission
(HHSC), an administrative agency within the executive department of the State of Texas, having its
principal office at 4900 North Lamar Boulevard, Austin, Texas 78751, and Amerigroup Texas,
Inc. (HMO) a corporation organized under the laws of the State of Texas, having its principal
place of business at: 3800 Buffalo Speedway, Suite 400, Houston, Texas 77098. HHSC and HMO
may be referred to in this Amendment individually as a “Party” and collectively as the “Parties.”

The Parties hereby agree to amend their original contract, HHSC contract number 529-06-0280-00002
(the “Contract”) as set forth herein. The Parties agree that the terms of the Contract will remain
in effect and continue to govern except to the extent modified in this Amendment.

This Amendment is executed by the Parties in accordance with the authority granted in Attachment A
to the HHSC Managed Care Contract document, “HHSC Uniform Managed Care Contract Terms &
Conditions,” Article 8, “Amendments and Modifications.”

	 	 	 	 	 
	Part 2: Effective Date of 

	 	Part 3: Contract Expiration 
	 	Part 4: Operational Start Date:
	Amendment:

	 	Date	 	 
	 
	 	 	 	 
	March 1, 2011

	 	August 31, 2013
	 	STAR and CHIP HMOs: September 1, 2006
	 

	 	 	 	STAR+PLUS HMOs: February 1, 2007
	 

	 	 	 	CHIP Perinatal HMOs: January 1, 2007

Part 5: Project Managers:

	 	 	 

	HHSC:

	 	HMO:
	 
	 	 
	Scott Schalchlin

	 	Aileen McCormick
	Director, Health Plan Operations

	 	Amerigroup Texas, Inc.
	11209 Metric Boulevard, Building H

	 	3800 Buffalo Speedway, Suite 400
	Austin, Texas 78758

	 	Houston, Texas 77098
	Phone: 512-491-1866

	 	Phone: 713-218-5101
	Fax: 512-491-1969

	 	Fax: 713-218-8692
	 
	 	 
	 

	 	E-mail: amccorm@amerigroupcorp.com

Part 6: Deliver Legal Notices to:

	 	 	 

	HHSC:

	 	HMO:
	 
	 	 
	General Counsel

	 	Amerigroup Texas, Inc.
	4900 North Lamar Boulevard, 4th Floor

	 	3800 Buffalo Speedway, Suite 400
	Austin, Texas 78751

	 	Houston, Texas 77098
	Fax: 512-424-6586

	 	Fax: 713-218-8692

Part 7: HMO Programs and Service Areas:

This Contract applies to the following HHSC HMO Programs and Service Areas (check all that apply).
All references in the Contract Attachments to HMO Programs or Service Areas that are not checked
are superfluous and do not apply to the HMO.

 

 

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

þ Medicaid STAR HMO Program

	 	 	 	 	 

	Service Areas:

	 	o Bexar
	 	o Lubbock
	 

	 	þ Dallas
	 	þ Nueces
	 

	 	o El Paso
	 	þ Tarrant
	 

	 	þ Harris
	 	þ Travis

See Attachment B-6, “Map of Counties with HMO Program Service Areas,” for listing of counties
included within the STAR Service Areas.

þ Medicaid STAR+PLUS HMO Program

	 	 	 	 	 

	Service Areas:

	 	þ Bexar
	 	o Nueces
	 

	 	þ Harris
	 	þ Travis

See Attachment B-6.1, “Map of Counties with STAR+PLUS HMO Program Service Areas,” for listing of
counties included within the STAR+PLUS Service Areas.

þ CHIP HMO Program

	 	 	 	 	 

	Core Service Areas:

	 	o Bexar
	 	þ Nueces
	 

	 	þ Dallas
	 	þ Tarrant
	 

	 	o El Paso
	 	o Travis
	 

	 	þ Harris	 	 
	 
	 

	 	o Lubbock	 	 
	 
	 	 	 	 
	Optional Service Areas:

	 	o Bexar
	 	o Lubbock
	 

	 	o El Paso
	 	o Nueces
	 

	 	o Harris
	 	o Travis

See Attachment B-6, “Map of Counties with HMO Program Service Areas,” for listing of counties
included within the CHIP Core Service Areas and CHIP Optional Service Areas.

þ CHIP Perinatal Program

	 	 	 	 	 

	Core Service Areas:

	 	o Bexar
	 	o Nueces
	 

	 	o Dallas
	 	þ Tarrant
	 

	 	o El Paso
	 	o Travis
	 

	 	o Harris	 	 
	 
	 

	 	o Lubbock	 	 

 

 

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

	 	 	 	 	 

	Optional Service Areas:

	 	o Bexar
	 	o Lubbock
	 

	 	o El Paso
	 	o Nueces
	 

	 	o Harris
	 	o Travis

See Attachment B-6.2, “Map of Counties with CHIP Perinatal HMO Program Service Areas,” for a list
of counties included within the CHIP Perinatal Service Areas.

Part 8: Payment

Part 8 of the HHSC Managed Care Contract document, “Payment,” is modified to add the capitation
rates for Rate Period 5.

þ Medicaid STAR HMO PROGRAM

Capitation: See Attachment A, “HHSC Uniform Managed Care Contract Terms and Conditions,”
Article 10, for a description of the Capitation Rate-setting methodology and the Capitation Payment
requirements for the STAR Program. The following Rate Cells and Capitation Rates will apply to Rate
Period 5:

******REDACTED******

STAR SSI Administrative Fee: HHSC will pay STAR HMO a monthly Administrative fee of
******REDACTED****** per SSI Beneficiary who voluntarily enrolls in HMO in accordance with
Attachment A, “HHSC Uniform Managed Care Contract Terms and Conditions,” Article 10.

Delivery Supplemental Payment: See Attachment A, “HHSC Uniform Managed Care Contract
Terms and Conditions,” Article 10, for a description of the methodology for establishing the
Delivery Supplemental Payment for the STAR Program.

Bariatric Supplemental Payment: See Attachment A, “HHSC Uniform Managed Care Contract Terms
and Conditions,” Article 10, for a description of the methodology for establishing the Bariatric
Supplemental Payment for the STAR Program.

 

 

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

þ Medicaid STAR+PLUS HMO Program

Capitation: See Attachment A, “HHSC Uniform Managed Care Contract Terms and Conditions,”
Article 10, for a description of the Capitation Rate-setting methodology and the Capitation Payment
requirements for the STAR+PLUS Program. The following Rate Cells and Capitation Rates will apply to
Rate Period 5:

******REDACTED******

Bariatric Supplemental Payment: See Attachment A, “HHSC Uniform Managed Care Contract Terms
and Conditions,” Article 10, for a description of the methodology for establishing the Bariatric
Supplemental Payment for the STAR+PLUS Program.

þ CHIP HMO PROGRAM

Capitation: See Attachment A, “HHSC Uniform Managed Care Contract Terms and Conditions,”
Article 10, for a description of the Capitation Rate-setting methodology and the Capitation Payment
requirements for the CHIP Program. The following Rate Cells and Capitation Rates will apply to Rate
Period 5:

******REDACTED******

Delivery Supplemental Payment: See Attachment A, “HHSC Uniform Managed Care Contract Terms
and Conditions,” Article 10, for a description of the methodology for establishing the Delivery
Supplemental Payment for the CHIP Program. The CHIP Delivery Supplemental Payment is
******REDACTED****** for all Service Areas.

þ CHIP Perinatal Program

Capitation: See Attachment A, “HHSC Uniform Managed Care Contract Terms and Conditions,”
Article 10, for a description of the Capitation Rate-setting methodology and the Capitation Payment
requirements for the CHIP Perinatal Program.

******REDACTED******

Delivery Supplemental Payment: See Attachment A, “HHSC Uniform Managed Care Contract Terms
and Conditions,” Article 10, for a description of the methodology for establishing the Delivery
Supplemental Payment for the CHIP Perinatal Program. The CHIP Perinatal Delivery Supplemental
Payment is ******REDACTED****** for Perinates between 186% and 200% of the Federal Poverty Level
for all Service Areas.

 

 

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

Part 9: Contract Attachments:

Modifications to Part 9 of the HHSC Managed Care Contract document, “Contract Attachments,” are
italicized below:

A: HHSC Uniform Managed Care Contract Terms & Conditions — Version 1.17 is replaced with Version
1.18

B: Scope of Work/Performance Measures — Version 1.17 is replaced with Version 1.18 for all
attachments, except if noted.

     B-1: HHSC RFP 529-04-272, Sections 6-9

     B-2: Covered Services

               B-2.1 STAR+PLUS Covered Services

               B-2.2 CHIP Perinatal Program Covered Services

     B-3: Value-added Services

               B-3.1 STAR+PLUS Value-added Services

               B-3.2 CHIP Perinatal Program Value-added Services

     B-4: Performance Improvement Goals

               B-4.1 SFY 2008 Performance Improvement Goals

     B-5: Deliverables/Liquidated Damages Matrix

     B-6: Map of Counties with STAR and CHIP HMO Program Service Areas

               B-6.1 STAR+PLUS Service Areas

               B-6.2 CHIP Perinatal Program Service Areas

     B-7: STAR+PLUS Attendant Care Enhanced Payment Methodology

C: HMO’s Proposal and Related Documents

          C-1: HMO’s Proposal

          C-2: HMO Supplemental Responses

          C-3: Agreed Modifications to HMO’s Proposal

Part 10: Special Provision for Nueces Service Area

Attachment A, Section 10.04 is amended to include sub-part (b) as follows:

(b) In addition to the reasons set forth in Section 10.04(a), the Parties expressly understand and
agree that HHSC may, at any time, unilaterally adjust the Rate Period 2 STAR Program Capitation
Rates for the Nueces Service Area. HHSC is entitled to unilaterally adjust such rates,
prospectively and/or retrospectively, if it determines that: (1) the cumulative Rate Period 2
Encounter Data for all HMOs in the Nueces Service Area does not support the Capitation Rates; or
(2) economic factors in the Nueces Service Area significantly and measurably impact providers or
the delivery of Covered Services to Members. For adjustments made pursuant to this Section
10.04(b), HHSC will provide written notice at least ten (10) Business Days before: (1) the
effective date of a prospective adjustment; (2) offsetting Capitation Payments to recover
retrospective adjustments. Any adjustments to the Rate Period 2 Capitation Rates must meet the
actuarial soundness requirements of Attachment A, Section 10.03, “Certification of Capitation
Rates.”

 

 

	 	 	 
	 	Contractual Document (CD)	

Responsible Office: HHSC Office of General Counsel (OGC)

			
	 	 	 
	Subject: HHSC Managed Care Contract
	 	HHSC Contract No. 529-06-0280-00002-S

Part 11: Signatures:

The Parties have executed this Contract Amendment in their capacities as stated below with
authority to bind their organizations on the dates set forth by their signatures. By signing this
Amendment, the Parties expressly understand and agree that this Amendment is hereby made part of
the Contract as though it were set out word for word in the Contract.

	 	 	 

	Taxas Health and Human Services Commission

	 	Amerigroup Texas, Inc.
	 
	 	 
	/s/ Charles E. Bell, M.D.

	 	/s/ Aileen McCormick
	 

	 	 
	Charles E. Bell, M.D.

	 	By: Aileen McCormick
	Deputy Executive Commisssioner for Health Services

	 	Title: President and CEO
	Date: 2/8/11

	 	Date: January 19, 2011exv10w28

Exhibit 10.28

REYNOLDS AMERICAN INC.

INDEPENDENT DIRECTORS’ COMPENSATION SUMMARY (Effective 1/1/2011)

	1.	 	Fees/Expense Reimbursement

	Fees:           	•	 	Board retainer fee of $60,000 per year. (Not paid to Non-Executive Chairman.)
	 
	 	•	 	Non-Executive Chairman retainer fee of $270,000 per year.
	 
	 	•	 	Non-Executive Chairman transitional services fee of $120,000 (one year, commencing Nov. 2010).
	 
	 	•	 	Committee Chair retainer fees:

	 	 	 	$20,000 per year for the Audit and Finance Committee Chair;
	 
	 	 	 	$10,000 per year for the Compensation and Leadership Development Committee Chair; and
	 
	 	 	 	$10,000 per year for the Corporate Governance and Nominating Committee Chair.

	 	•	 	Committee meeting attendance fees of $1,500 per meeting. (Not paid to Non-Executive
Chairman.)
	 
	 	•	 	Board meeting attendance fees of $1,500 per meeting. (Not paid to Non-Executive
Chairman.)

	 	 	 	Fees are payable quarterly in arrears, but may be deferred in 25% increments in cash and/or in deferred stock units until
termination of active directorship or until a selected year in the future. To be tax effective, an irrevocable deferral
election must be made in the year prior to the year fees would otherwise be payable.

			
		Expense Reimbursement:	 	Directors are reimbursed for actual expenses incurred in connection with attendance at Board and
committee meetings, including transportation and lodging expenses.

	2.	 	Equity Incentive Award Plan

	 	•	 	Upon election to the Board, an independent director receives an initial grant of 3,500
deferred stock units or, at the director’s election, 3,500 shares of RAI common stock.
	 
	 	•	 	Annual grant of 4,000 deferred stock units (8,000 for Non-Executive Chairman) made at the
time of the Annual Meeting and immediately vested. Director can elect to receive
non-deferred award of 4,000 shares of RAI common stock (8,000 for Non-Executive Chairman) in
lieu of deferred stock units.
	 
	 	•	 	Quarterly grants of deferred stock units on the last day of each calendar quarter. Number
of deferred stock units equal to $10,000 ($20,000 for Non-Executive Chairman) divided by the
average of the closing price of a share of RAI common stock (as reported on the NYSE) for
each business day during the last month of such calendar quarter.
	 
	 	•	 	Initial and annual deferred stock units paid per director’s election in cash or RAI common
stock, and quarterly deferred units paid in cash only, following termination of active
directorship per director’s election in either a lump sum or in up to ten annual
installments.

	3.	 	Life Insurance

Option to receive $50,000 or $100,000 non-contributory coverage while an active director. Imputed
income will be calculated based on director’s end-of-year age and coverage amount.

	4.	 	Excess Liability Insurance

Eligible to receive $10,000,000 in Excess Liability coverage. No cash payment required; the fair
market value will be imputed income to directors each year. Policy requires that directors have at
least $300,000 underlying liability limit under a homeowner’s or other personal liability policy.
Directors are obligated to pay for claims up to $300,000 not covered by this policy.

	5.	 	Business Travel Accident Insurance

$500,000 non-contributory coverage while an active director.

	6.	 	Matching Grants

Match of 1:1 for Educational/Arts/Cultural/Charitable Organizations — combined $10,000 maximum.

	7.	 	Director Education Programs

	 	•	 	Directors may attend one outside director education program per year at RAI’s expense.
	 
	 	•	 	Directors are reimbursed for actual expenses incurred in connection with attendance at
director education programs, including transportation and lodging expenses.

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