Document:

EXHIBIT
                                              10.2

<PAGE>
                              SETTLEMENT AGREEMENT

                                        I.          PARTIES

       This Settlement Agreement and Release ("Agreement") is
entered into between (1) the United States of America, acting
through its Department of Justice and on behalf of the Office of
Inspector General of the United States Department of Health and
Human Services ("HHS-OIG") (collectively, the "United States")
(2) Staff Builders, Inc., (a Delaware corporation) , Staff
Builders, Inc. (a New York corporation) , Staff Builders
Services, Inc., Staff Builders International, Inc., Staff
Builders Home Health Care Services, Inc., St. Lucie Home Health
Agency, Inc., and Tender Loving Care Health Care Services, Inc.
(as successor in interest to Staff Builders, Inc.) (these
companies are collectively referred to as "Tender Loving Care"),
and (3) Robert G. Pina, Jr., and Sheila R. Pina (the "relators").
Collectively, all of the above will be referred to as "the
Parties."

                                        11.         PREAMBLE

       As a preamble to this Agreement, the Parties agree to the
following:

     A.        Tender Loving Care grants franchises to other
companies which provide, among other things, home health care
services to Medicare recipients.  One such former franchise was
Campo Care, Inc., located in or near Port St. Lucie, Florida, and
during the relevant time period it operated as a management
company providing home health care services to Medicare
recipients in and near Port St. Lucie, Florida. During the period
in or about 1990 to September 1996 Tender Loving Care submitted
claims to the Medicare program ("Medicare") , Title XVIII of the
Social Security Act, 42 U.S.C. 1395-1395ddd(1997), which included
claimed costs of Campo Care, Inc. for providing home health
services. In September 1996, Tender Loving Care purchased back
the franchise from Campo Care, Inc.

     B.       Robert G. Pina, Jr., and Sheila R. Pina are individual
residents of Florida.  On or about September 23, 1996, the
relators filed a qui tam action in a United States District Court
entitled United States ex rel. Pina v. Staff Builders, Inc., et
al., Civ. No. 96-86664 (S.D. Fla.) ("the Civil Action"). Mrs.
Pina is a former employee of Campo Care, Inc. and a current
employee of Tender Loving Care.

     C.       Tender Loving Care submitted or caused to be submitted
claims for payment to Medicare.

     D.       The United States contends that it has certain civil
claims against Tender Loving Care under the False Claims Act, 31
U.S.C. 3729-3733, and other federal statutes and/or common law
doctrines as specified herein, for engaging in the following
conduct as to services provided by Campo Care, Inc. and paid by
Medicare during the period between in or about 1990 to September
1996: (1) submitting claims for unallowable costs incurred to pay
medical doctors and/or others in exchange for referrals of
patients to receive home health care services (i.e. payment of
salaries of nurses or others to be stationed in the offices of
such medical doctors, expenses for vacations or trips taken by
such medical doctors, and other gratuities) ; (2) submitting
claims for fictitious or excessive vehicle mileage costs; (3)
submitting inflated and false lease costs for equipment and
office supplies; (4) submitting claims for unallowable costs for
salaries and related expenses of persons not providing home
health care services; (5) submitting claims for unallowable costs
associated with a tackle and bait shop owned by Mr. Campo that
were not incurred in connection with providing medical services;
and (6) submitting claims for unallowable costs for improper or
excessive bonuses (hereinafter collectively referred to as the
"Covered Conduct"). However, the Covered Conduct specifically
does not include the allegations regarding Medicaid in the
relators' qui tam complaint.

     E.       The United States also contends that it has certain
administrative claims against Tender Loving Care under the
provisions for permissive exclusion from the Medicare, Medicaid
and other federal health care programs, 42 U.S.C. 1320a-7(b),
and the provisions for civil monetary penalties, 42 U.S.C.
1320a-7, for the Covered Conduct.

     F.      Tender Loving Care denies the contentions of the United
States, as set forth in Paragraphs D & E above. Tender Loving
Care also denies the allegations in the relators'  qui tam
complaint.

       G. To avoid the delay, uncertainty, inconvenience, and
expense of protracted litigation of these claims, the Parties
reach a full and final settlement as set forth below.

                             III. TERMS AND CONDITIONS

       NOW, THEREFORE, in consideration of the mutual promises,
covenants and obligations set forth below, and for good and
valuable consideration as stated herein, the Parties agree as
follows:

     1.      Tender Loving Care agrees to pay the total sum of one
million four hundred thousand dollars ($1,400,000.00) (hereafter
the "Settlement Amount"). The payments for the settlement amount
shall be made as follows: Tender Loving Care hereby releases,
relinquishes, and transfers to the United States all interest in
one million four hundred thousand dollars ($1,400,000.00) of
suspended Medicare payments held by United Government Services,
LLC, its Medicare fiscal intermediary, which have been withheld
from payment to Tender Loving Care pursuant to the notice of
suspension dated May 5, 1999. Upon execution of this Agreement,
the suspended payments will be applied to satisfy Tender Loving
Care's payment obligations under this Agreement, and any excess

withholdings will be remitted to Tender Loving Care in accordance
with 42 1C. F. R.  405.372 (e)

        2.                        Tender Loving Care further agrees that:

          a.         The payment obligations described in Paragraph 1
of this Agreement shall be binding upon all of the entities
collectively referenced above as Tender Loving Care; and

          b.         This Agreement, and the obligations imposed
herein, shall be binding upon all successors, transferees, heirs
and assigns of Tender Loving Care (except that with respect to
the Corporate Integrity Agreement (CIA) with HHS-OIG, attached as
Exhibit A, the CIA is subject to any limitations contained in the
CIA as to successors, transferees, heirs and assigns of Tender
Loving Care).

     3.      Subject to the exceptions in Paragraphs 6 & 8 below, in
consideration of the obligations of Tender Loving Care set forth
in this Agreement, and subject to Paragraph 18 below (regarding
bankruptcy), the United States, on behalf of itself, its
officers, agents, agencies and departments, hereby releases for
the Covered Conduct Tender Loving Care and its present or former
directors, officers and employees (subject to the limitations in
paragraph 6 below) from any civil or administrative monetary
claims that the United States has or may have under the False
Claims Act, 31 U.S.C.  3729-3733, the Program Fraud Civil
Remedies Act, 31 U.S.C.  3801-3812, the Civil Monetary
Penalties Law, 42 U.S.C. S 1320a-7a, or the common law theories
of payment by mistake, unjust enrichment, and fraud.

     4.      In consideration of the obligations of Tender Loving
Care set forth in this Agreement, and subject to Paragraph 18
below (regarding bankruptcy), the HHS-OIG agrees to release and
refrain from instituting, directing or maintaining any
administrative claim or any action seeking exclusion from the
Medicare, Medicaid or other Federal health care programs (as,
defined in 42 U.S.C.  1320a-7b(f)) against Tender Loving Care
and its present or former directors, officers and employees under
42 U.S.C.  1320a-7a (Civil Monetary Penalties Law), or 42 U.S.C.
132Oa-7(b) (permissive exclusion), for the Covered Conduct,
except as reserved in Paragraph 6 herein, and as reserved in this
Paragraph. The HHS-OIG expressly reserves all rights to comply
with any statutory obligations to exclude Tender Loving Care from
the Medicare, Medicaid and other Federal health care programs
under 42 U.S.C.  1320a-7(a)(mandatory exclusion) based upon the
Covered Conduct. Nothing in this Paragraph precludes the HHS-OIG
from taking action against entities or persons, or for conduct
and practices, for which civil claims have been reserved in
Paragraph 6, below.

     5.       The United States agrees to pay the relators, jointly,
$252,000 as their share of the proceeds of the Civil Action,
pursuant to 31 U.S.C.  3730(d)(1). Upon receipt of payment, the
relators, and their attorneys, agree to release the United
States, its officers, agents, and employees, from any liability

related to the filing of the Civil Action, including any claims
arising under 31 U.S.C.  3730(c) (5), (d), and (d) (1) ; and
relators agree to release Tender Loving Care and its present and
former directors, officers, and employees from any liability
relating to all causes of action raised or could have been raised
in the Civil Action. This Agreement does not resolve claims the
relators may have against Tender Loving Care for attorneys' fees,
costs, and other reasonable expenses, pursuant to 31 U.S.C.
3730(d), which shall be separately negotiated between the
relators and Tender Loving Care. In addition, the relators, and
their attorneys, agree that this settlement is fair, adequate and
reasonable, and that they will not challenge the settlement or
this Agreement pursuant to 31 U.S.C. S 3730(d).

     6.       Notwithstanding any term of this Agreement,
specifically reserved and excluded from the scope and terms of
this Agreement as to any entity or person (including each of the
Tender Loving Care entities described herein) are any and all of
the following:

               (1) Any civil, criminal or administrative claims
arising under Title 26, United States Code (Internal Revenue
Code);

               (2) Any criminal liability;

               (3) Except as explicitly stated in this Agreement, any
administrative liability, including mandatory exclusion from
Federal health care programs;

               (4) Any liability to the United States (or its
agencies) for any conduct not described in the Covered Conduct;

               (5) Any Medicaid claims;

               (6) Any claims based upon such obligations as are
created by this Agreement;

               (7) Any express or implied warranty claims or other
claims for defective or deficient products or services, including
quality of goods and services, provided by Tender Loving Care;
and/or

               (8) Any civil or administrative claims against
individuals, including present or former directors, officers, or
employees of Tender Loving Care who have been or at any time in
the future (a) receive target letters from a criminal prosecutor,
(b) are criminally indicted or charged, (c) are convicted of a
crime, or (d) enter into a criminal plea agreement, related in
any manner to the Covered Conduct.

     7.       Tender Loving Care has entered into a Corporate
Integrity Agreement (CIA) with HHS-OIG, attached as Exhibit A,
which is incorporated into this Agreement by reference. Tender
Loving Care will upon execution of this Agreement begin to
implement its obligations under the CIA.

     8.      Tender Loving Care has provided sworn financial
disclosure statements ("Financial Statements") to the United
States and the United States has relied on the accuracy and
completeness of those Financial Statements in reaching this
Agreement. Tender Loving Care warrants that the Financial
Statements were thorough, accurate, and complete in all material
respects at the time they were provided and that there has been
no material change which has been undisclosed in writing to the
Civil Division, Department of Justice in the financial condition
of Tender Loving Care as of the date of this Agreement. Tender
Loving Care further warrants that it does not own or have a
material interest in any assets which have not been disclosed in
the Financial Statements or subsequent written disclosures to the
Civil Division, and that Tender Loving Care has made no material
misrepresentations on, or in connection with, the Financial
Statements. In the event the United States learns of asset(s) in
which Tender Loving Care had a material interest at the time of
this Agreement which were not disclosed in the Financial
Statements or subsequent written disclosures to the Civil
Division, Department of Justice, or in the event the United
States learns of a material misrepresentation by Tender Loving
Care, on, or in connection with, the Financial Statements, and in
the event such non-disclosure or misrepresentation changes the
estimated net worth of Tender Loving Care set forth on the
Financial Statements by one hundred thousand dollars
($100,000.00) or more, the United States may at its option: (1)
rescind this Agreement and file suit or reinstate its suit upon
the underlying claims described above; or (2) let the Agreement
stand and collect the full Settlement Amount plus one hundred
percent (100%) of the value of the net worth of Tender Loving
Care previously undisclosed up to two million dollars
($2,000,000). Tender Loving Care agrees not to contest any
collection action undertaken by the United States pursuant to
this provision, except as to the issues of whether there had been
such a non-disclosure or misrepresentation by Tender Loving Care.

     9.       In the event that the United States, pursuant to
paragraph 8, above, opts to rescind this Agreement, Tender Loving
Care expressly agrees not to plead, argue or otherwise raise any
defenses under the theories of statute of limitations, laches,
estoppel or similar theories, to any civil or administrative
claims which (1) are filed by the United States within 60
calendar days of written notification to Tender Loving Care that
this Agreement has been rescinded, and (2) relate to the Covered
Conduct, except to the extent these defenses were available on or
before September 23, 1996.

     10.      Tender Loving Care waives and will not assert any
defenses that it may have to any legal proceeding (i.e., criminal
prosecution or administrative actions) relating to the Covered

<PAGE>
Conduct, which defenses may be based in whole or in part on the
Double Jeopardy or Excessive Fines Clause of the Constitution or
the holding or principles set forth in United States v. Halper,
490 U.S. 435 (1989), and Austin v. United States, 509 U.S. 602 (1997),
and agrees that this Settlement is not punitive in nature or
effect for purposes of such legal proceeding. Nothing in this
paragraph or any other provision of this Agreement constitutes an
agreement by the United States concerning the characterization of
the Settlement Amount for purposes of the Internal Revenue Laws,
Title 26 of the United States Code.

     11.       Tender Loving Care fully and finally releases the
United States, its agencies, employees, servants, and agents from
any claims (including attorneys fees, costs, and expenses of
every kind and however denominated) which Tender Loving Care has
asserted, could have asserted, or may assert in the future
against the United States, its agencies, employees, servants, and
agents, related to the Covered Conduct and the United States,
investigation and prosecution thereof.

     12.       Although the United States does not believe that
Tender Loving Care is entitled to any award of restitution, the
Parties agree that should Tender Loving Care be awarded any
compensation or payment in any criminal proceeding for being an
alleged victim of fraud or misconduct by Mr. Jack Campo, Campo
Care, Inc. or others convicted of crimes relating to the Covered
Conduct, Tender Loving Care shall not accept such funds but shall
direct that such funds be paid to the United States in accordance
with instructions by the United States Attorney's Office.

     13.       The Settlement Amount that Tender Loving Care must pay
pursuant to this Agreement will not be decreased as a result of
the denial of claims for payment now being withheld from payment
by any Medicare carrier or intermediary, any payer for other
Federal health care programs or any State payer, related to the
Covered Conduct; and Tender Loving Care agrees not to resubmit to
any Medicare carrier or intermediary, any payer for others
Federal health care programs, or any State payer any previously
denied claims related to the Covered Conduct, and agrees not to
appeal any such denials of claims.

     14.       Tender Loving Care agrees that all costs (as defined
in the Federal Acquisition Regulations ("FAR") S 31.205-47 and in
Titles XVIII and XIX of the Social Security Act, 42 U.S.C.
1395-1395ggg (1997) and 1396-1396v (1997), and the regulations
promulgated thereunder) incurred by or on behalf of Tender Loving
Care and its present or former directors, officers, employees,
shareholders, and agents in connection with: (1) the matters
covered by this Agreement, (2) the Government's audit(s) and
civil and any criminal investigation(s) of the matters covered by
this Agreement, (3) Tender Loving Care's investigation, defense,
and corrective actions undertaken in response to the Government's

<PAGE>
audit(s) and civil and any criminal investigation(s) in
connection with the matters covered by this Agreement (including
attorney's fees), (4) the negotiation of this Agreement and the
CIA, (5) the payments made pursuant to this Agreement (and
attorneys (i) fees paid to the relators or their counsel), and
(6) the obligations under the CIA to (i) perform Review
Procedures as described in the CIA (except to the extent that
such Review Procedures are performed by Tender Loving Care), and
(ii) prepare and submit reports to the HHS-OIG, are unallowable
costs on Government contracts and under the Medicare program,
Medicaid program, or any other Federal health care program
(hereafter, "unallowable costs"). These unallowable costs will be
separately determined and accounted for in a non-reimbursable
cost center by Tender Loving Care, and Tender Loving Care will
not charge such unallowable costs directly or indirectly to any
contracts with the United States or any state Medicaid program,
or seek payment for such unallowable costs through any cost
report, cost statement, information statement or payment request
submitted by Tender Loving Care or any of its affiliates or
subsidiaries to the Medicare, Medicaid, any other Federa1 health
care programs.

       Tender Loving Care further agrees that within sixty (60)
days of the effective date of this Agreement, it will identify to
applicable Medicare and Tricare fiscal intermediaries, carriers
and/or contractors, and Medicaid or other Federal health care
program fiscal agents, any unallowable costs (as defined in this
paragraph) included in payments previously sought f rom the
United States, or any State Medicaid Program, including, but not
limited to, payments sought in any cost reports, cost statements,
information reports, or payment requests already submitted by
Tender Loving Care, or any of their affiliates or subsidiaries,
and will request, and agree, that such cost reports, cost
statements, information reports or payment requests, even if
already settled, be adjusted to account for the effect of the
inclusion of the unallowable costs. Tender Loving Care agrees
that the United States will be entitled to recoup from Tender
Loving Care any overpayment as a result of the inclusion of such
unallowable costs on previously-submitted cost reports,
information reports, cost statements or requests for payment. Any
payments due after the adjustments have been made shall be paid
to the United States pursuant to the direction of the Department
of Justice, and/or the affected agencies. The United States
reserves its rights to disagree with any calculations submitted
by Tender Loving Care or any of its affiliates or subsidiaries on
the effect of inclusion of unallowable costs (as defined in this
paragraph) on Tender Loving Care or any of its affiliates or
subsidiaries, cost reports, cost statements or information
reports. Nothing in this Agreement shall constitute a waiver of
the rights of the United States to examine or reexamine the
unallowable costs described in this Paragraph.

     15.       Tender Loving Care covenants to cooperate fully and
truthfully with the United States, investigation of individuals
and entities not specifically released in this Agreement, for the
Covered Conduct. Upon reasonable notice, Tender Loving Care will
make reasonable efforts to facilitate access to, and encourage
the cooperation of, its present or former directors, officers,
and employees for interviews and testimony, consistent with the
rights and privileges of such individuals, and will furnish to
the United States, upon reasonable request, all non-privileged
documents and records in its possession, custody or control
relating to the Covered Conduct.

     16.       This Agreement is intended to be for the benefit of
the Parties only, and by this instrument the Parties do not
release any claims against any other person or entity. Any
amounts described in this Agreement are not intended to have any
effect upon any other claim whatsoever with respect to third
Parties, including but not limited to the other named defendants
in the related qui tam lawsuit filed by the relators.

     17.       Tender Loving Care agrees that it will not seek
payment for any of the health care billings covered by this
Agreement from any health care beneficiaries or intermediaries or
its parents or sponsors. Tender Loving Care waives any causes of
action against these beneficiaries or their parents or sponsors
based upon the claims for payment covered by this Agreement.

     18.       The Parties expressly warrant that, in evaluating
whether to execute this Agreement, the Parties (i) have intended
that the mutual promises, covenants and obligations set forth
herein constitute a contemporaneous exchange for new value given
to Tender Loving Care within the meaning of 11 U.S.C. S
547(c)(1), and (ii) have concluded that these mutual promises,
covenants and obligations do, in fact, constitute such a
contemporaneous exchange. In the event that Tender Loving Care
(which includes any one of the entities defined above to be
included in the definition of Tender Loving Care) commences, or a
third party commences, within 91 days of the date of this
Agreement, any case, proceeding, or other action (a) under any
law relating to bankruptcy, insolvency, reorganization or relief
of debtors, seeking to have any order for relief of Tender Loving
Care's debts, or seeking to adjudicate Tender Loving Care as
bankrupt or insolvent, or (b) seeking appointment of a receiver,
trustee, custodian or other similar official for Tender Loving
Care or for all or any substantial part of Tender Loving Care's
assets, Tender Loving Care agrees as follows:

          a.         Tender Loving Care's obligations under this
Agreement may not be avoided pursuant to 11 U.S.C. Section 547,
and Tender Loving Care will not argue or otherwise take the
position in any such case, proceeding or action that: Tender
Loving Care's obligations under this Agreement may be avoided
under 11 U.S.C. Section 547; (ii) Tender Loving Care was
insolvent at the time this Agreement was entered into, or became
insolvent as a result of the payment made to the United States
hereunder; or (iii) the mutual promises, covenants and
obligations set forth in this Agreement do not constitute a
contemporaneous exchange for new value given to Tender Loving
Care.

          b.         In the event that Tender Loving Care's obligations
hereunder are avoided for any reason, including, but not limited
to, through the exercise of a trustee's avoidance powers under
the Bankruptcy Code, the United States, at its sole option, may
rescind the releases in this Agreement, and bring any civil
and/or administrative claim, action or proceeding against Tender
Loving Care for the claims that would otherwise be covered by the
releases provided for in this Agreement. If the United States
chooses to do so, Tender Loving Care agrees that any such claims,
actions or proceedings brought by the United States (including
any proceedings to exclude Tender Loving Care from participation
in Medicare, Medicaid, or other Federal health care programs) are
not subject to an "automatic stay" pursuant to 11 U.S.C. Section
362(a) as a result of the action, case or proceeding described in
the first clause of this Paragraph, and that Tender Loving Care
will not argue or otherwise contend that the United States,
claims, actions or proceedings are subject to an automatic stay;
(ii) that Tender Loving Care will not plead, argue or otherwise
raise any defenses under the theories of statute of limitations,
laches, estoppel or similar theories, to any such civil or
administrative claims, actions or proceeding which are brought by
the United States within 60 calendar days of written notification
to Tender Loving Care that the releases herein have been
rescinded pursuant to this Paragraph, except to the extent such
defenses were available on or before September 23, 1996; and
(iii) will not contest that the United States has a valid claim
against Tender Loving Care in the amount of $3 million, and the
United States may pursue its claim, inter alia, in the case,
action or proceeding referenced in the first clause of this
Paragraph, as well as in any other case, action, or proceeding.

               c.     Tender Loving Care acknowledges that its
agreements in this Paragraph are provided in exchange for
valuable consideration provided in this Agreement.

        19. Unless otherwise agreed to in writing between or among
any of the Parties, each Party to this Agreement will bear its
own legal and other costs incurred in connection with this
matter, including the preparation and performance of this
Agreement.

     20.       Tender Loving Care and the relators represent that
this Agreement is freely and voluntarily entered into without any
degree of duress or compulsion whatsoever.

     21.       This Agreement is governed by the laws of the United
States. The Parties agree that, except for matters arising under
the CIA, the exclusive jurisdiction and venue for any dispute
arising between and among the Parties under this Agreement will
be the United States District Court for the Southern District of
Florida, where the Civil Action was filed. Any issue arising
under the CIA will be handled in accordance with the Disputes
Resolution provision of the CIA.

        22. Promptly after this Agreement is executed, the United
States shall file a notice with the district court that the
United States is partially intervening in the Civil Action only
with respect to Staff Builders, Inc. and Staff Builders Home
Health Care, Inc. relating to Medicare allegations, and that the
United States, relators and defendants Tender Loving Care have
entered into a Settlement Agreement with said two defendants. The
notice of dismissal will state that the court retains
jurisdiction of this case for the purpose of enforcing the terms
of the Settlement Agreement. The notice of dismissal also shall
state that all of the relators' claims and causes of action are
hereby dismissed with prejudice as to defendants Staff Builders,
Inc. and Staff Builders Home Health Care, Inc., and that the
Covered Conduct against these two named defendants is dismissed
with prejudice as to the United States. Any claims of the United
States or the State of Florida regarding Medicaid will be
dismissed without prejudice as to the United States and the State
of Florida. The Parties agree that the court will retain
jurisdiction regarding enforcement of this Agreement.

     23.       This Settlement Agreement and the CIA that is
incorporated herein by reference constitute the complete
agreement between the Parties that involves the United States or
any of its agencies. This Agreement may not be amended except by
written consent of the Parties, except that only Tender Loving
Care and HHS-OIG must agree in writing to modification of the
CIA, as specified in the CIA.

     24.       The undersigned individuals signing this Agreement on
behalf of Tender Loving Care and the relators represent and
warrant that they are authorized by those Parties to execute this
Agreement. The undersigned United States signatories represent
that they are signing this Agreement in their official capacities
and that they are authorized to execute this Agreement.

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

       26.      This Agreement is effective on the date of signature
  of the last signatory to the Agreement.

THE UNITED STATES-OF AMERICA

DAVID W. OGDEN
Acting Assistant Attorney General

GUY A. LEWIS
United States Attorney
Southern District of Florida

Dated: 8/30/00                                     By: /s/ Laurie E. Rucoba
                                                   LAURIE E. RUCOBA
                                                   Assistant United States
Attorney
                                                   500 East Broward Boulevard
                                                   Suite 700
                                                   Ft. Lauderdale, Florida 33394
                                                   Bar No. A5500052
                                                   Telephone: (954) 356-7314
                                                   X3613
                                                   Facsimile: (954) 356-7190

Dated: 8/30/00                                     By: /s/ Joel D. Hesch
                                                   JOEL D. HESCH
                                                   Trial Attorney
                                                   Commercial Litigation Branch
                                                   Civil Division
                                                   U. S. Department of Justice

Dated: 8/24/00                                     By: /s/ Lewis Morris
                                                   LEWIS MORRIS
                                                   Assistant Inspector General
                                                   for Legal Affairs
                                                   Office of Counsel to the
                                                   Inspector General
                                                   Office of Inspector General
                                                   U.S. Department of Health and
                                                   Human Services

<PAGE>
        THE RELATORS Robert G. Pina. Jr., and Sheila R. -Pina

/s/ Gary Roberts                                   Dated: 8/21/00
GARY ROBERTS, Esq.
Counsel for Mr. and Mrs. Pina

<PAGE>
                         Tender Loving Care (COLLECTIVELY)

/s/ Frederick Robinson
FREDERICK ROBINSON, ESQ.
Fulbright & Jaworski, L.L.P.
Dated: August 25, 2000

  Counsel for Staff Builders, Inc. (a New York corporation),
  Staff Builders Services, Inc., Staff Builders International,
  Inc., Staff Builders Rome Health Care Services, Inc., St. Lucie
  Home Health Agency, Inc., and Tender Loving Care Health Care
  Services, Inc.

TOTAL P.02

<PAGE>
Tender Loving Care/Staff Builders, Inc. (a New York corporation)

/s/ Dale R. Clift                                  Dated: 8/21/oo
DALE R. CLIFT
President and Chief Operating Officer
Tender Loving Care/Staff Builders, Inc. (a New York corporation)

<PAGE>
               Staff Builders, Inc. (a Delaware corporation)

/s/ Stephen Savitsky                                       Dated: 8/21/00
STEPHEN SAVITSKY Chief Executive Officer
Staff Builders, Inc. (a Delaware corporation)

On behalf of Staff Builders, Inc. (a Delaware corporation)EXHIBIT
                                     10.3
CORPORATE INTEGRITY AGREEMENT
BETWEEN THE
OFFICE OF INSPECTOR GENERAL
OF THE
DEPARTMENT OF HEALTH AND HUMAN SERVICES
AND
TENDER LOVING CARE, INC.

PREAMBLE

   Staff Builders, Inc. (a New York corporation), Staff Builders
Services, Inc., Staff Builders International, Inc., Staff
Builders Home Health Care Services, Inc., St. Lucie Horne Health
Agency, Inc. and Tender Loving Care Health Care Services, Inc.
(as successor-in- interest to Staff Builders Inc.) (all of these
are referred to collectively as "Tender Loving Care") hereby
enters into this Corporate Integrity Agreement ("CIA") with the
Office of Inspector General ("OIG") of the United States
Department of Health d Human Services ("HHS"). The intent of this
CIA is to promote compliance by Tender Loving Care's officers,
directors, employees, contractors and agents who provide home
health services and/or are engaged in the preparation and/or
submission of claims, cost reports or other requests for
reimbursement for such services ("Covered Persons") 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").  The term Covered Persons does not include
part-time or per diem employees 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 any 12 month period.
Contemporaneously with this CIA, Tender Loving Care is entering
into a Settlement Agreement with the United States, and this CIA
is incorporated by reference into the Settlement Agreement.

Prior to the execution of this CIA, Tender Loving Care
established a compliance program that includes corporate
integrity policies and procedures and, as represented by Tender
Loving Care, is aimed in part, at ensuring that Tender Loving
Care's participation in Federal health care programs is in
conformity with the Federal health care program requirements.
Pursuant to this CIA, Tender Loving Care agrees to continue the
operation of its compliance program during the term of this CIA
in a manner that meets the requirements of this agreement. Tender
Loving Care may modify its compliance program as appropriate, but
at a minimum, Tender Loving Care shall ensure that it complies
with the integrity obligations that are enumerated in this CIA.

11.       TERM OF THE CIA

     The period of the compliance obligations assumed by Tender
Loving Care under this CIA shall be five years from the effective
date of the Medicare Prospective Payment System ("PPS")
reimbursement for home health services (unless otherwise
specified). For purposes of this CIA, the effective date of PPS
will be deemed to be the earlier of the actual implementation
date of PPS by the Health Care Financing Administration ("HCFA")
or December 1, 2000. The effective date of this CIA shall be the
date on which the final signatory of this CIA executes this CIA.

     Sections VIL VIII, IX, X and XI shall remain in effect until
Tender Loving Care submits all information required by OIG as
part of the final Annual Report.

 III.        CORPORATE INTEGRITY OBLIGATIONS

     Tender Loving Care hereby agrees to establish or maintain,
as appropriate, a Compliance Program that includes the following
elements:

      A. Compliance Officer and Committee.

             1. Compliance Officer. Tender Loving Care has
appointed an individual to serve as its Compliance Officer.  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 is and shall continue to be a member of senior management
of Tender Loving Care, shall make periodic (at least quarterly)
reports regarding compliance matters directly to the CEO and/or
President and/or to the Board of Directors of Tender Loving Care,
and shall be authorized to report on such matters to the Board of
Directors at any time. The Compliance Officer shall be
responsible for monitoring the day-to-day compliance activities
engaged in by Tender Loving Care as well as for any reporting
obligations created under this CIA.

       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, must be reported
 to OIG, in writing, within 15 days of such a change.

            2. Compliance Committee. To the extent not already
accomplished, within 90 days of the effective date of this CIA,
Tender Loving Care shall appoint a Compliance Committee. The
Compliance Committee shall, at a minimum, include the Compliance
Officer and any other members of senior management necessary to
meet the requirements of this CIA ( e.g.., senior executives of
each major department, such as billing, clinical, human
resources, 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).

      Any changes in the membership 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, must be reported to OIG, in writing,
within 15 days of such a change.

      B. Written Standards.

             1. Code of Conduct. Prior to the execution of this
CIA, Tender Loving Care established a Code of Conduct that as
represented to the OIG, meets the requirements of this Section
III.B. 1.  To the extent not already accomplished, the Code of
Conduct shall be distributed to all Covered Persons within 120
days of the effective date of this CIA. Tender Loving Care 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 the following:

                  a. Tender Loving Care's commitment to full
                  compliance with all Federal health care program
                  requirements, including its commitment to prepare
                  and submit accurate claims for reimbursement
                  consistent with such requirements;

                  b. Tender Loving Care's requirement that all
                  Covered Persons shall be expected to comply with
                  all Federal health care program requirements and
                  with Tender Loving Care's own Policies and
                  Procedures as implemented pursuant to section
                  111.B (including the requirements of this CIA);

                  c. the requirement that all of Tender Loving
                  Care's Covered Persons shall be expected to report
                  to the Compliance Officer or other individual
                  designated by Tender Loving Care any suspected
                  violations of any Federal health care program
                  requirements or of Tender Loving Care's own
                  Policies and Procedures;

                  d. the possible consequences to both Tender Loving
                  Care and Covered Persons of failure to comply with
                  all Federal health care program requirements and
                  with Tender Loving Care's own Policies and
                  Procedures or of failure to report such
                  non-compliance; and

                  e. the right of all individuals to use the
                  Confidential Disclosure Program as described in
                  section III.E, and Tender Loving Care's commitment
                  to maintain confidentiality, as appropriate, and
                  non-retaliation with respect to disclosures.

     To the extent not already accomplished, within 120 days of
the effective date of the CIA, each Covered Person shall certify,
in writing, that he or she has received, read, understood, and
will abide by Tender Loving Care's Code of Conduct. New Covered
Persons shall receive the Code of Conduct and shall complete the
required certification within two weeks after becoming a Covered
Person or within 120 days of the effective date of the CIA,
whichever is later.

     Tender Loving Care shall annually review the Code of Conduct
to determine if revisions are appropriate and shall make any
necessary revisions based on such a review. Any significant
changes in the Code of Conduct shall be distributed within 30
days of finalizing such changes. Covered Persons shall certify
that they have received, read, understood and will abide by the
revised Code of Conduct within 30 days of the distribution of
such revisions.

           2. Policies and Procedures. To the extent not already
accomplished, within 120 days of the effective date of this CIA,
Tender Loving Care shall implement written Policies and
Procedures regarding the operation of Tender Loving Care's
compliance program and its compliance with Federal health care
program requirements. At a minimum, the Policies and Procedures
shall address:

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

                  b. the preparation of true and accurate claims for
                  reimbursement (including cost reports or
                  equivalent reporting mechanisms) submitted to the
                  Federal health care programs; and

                  c. compliance with federal health care program
                  requirements prohibiting kickback arrangements and
                  the establishment of  certain self-referral
                  arrangements; including, but not limited to, the
                  anti-kickback statute found at 42 U.S.C.   1320a
                  - 7b(b)(1) & (2), 42 U.S. C.  1320a-7a(a)(7) and
                  42 U.S.C. 1320a-7(b)(7) and the Ethics in Patient
                  Referrals Act (commonly known as the "Stark law")
                  found at 41 U.S.C.  1395nn.

                  The Policies and Procedures shall be available to
                  OIG, upon request. Within 120 days of the
                  effective date of the CIA, the relevant portions
                  of the Policies and Procedures shall be made
                  available to all individuals whose job functions
                  are related to those Policies and Procedures.
                  Appropriate and knowledgeable staff should be
                  available to explain the Policies and Procedures.

                      At least annually (and more frequently if
appropriate), Tender Loving Care shall assess and update as
necessary the Policies and Procedures. Within 30 days of the
effective date of any revisions, The relevant portions of any
such revised Policies and Procedures shall be made available to
all individuals whose job functions are related to Those Policies
and Procedures.
                         I

         C. Training and Education.

                1. General Training. Within 90 days of the
     effective dare of this CIA, Tender Loving Care shall notify
     all Covered Persons of the key terms of this CIA and Tender
     Loving Care's Compliance Program, Within 90 days of the
     effective date of PPS, Tender Loving Care shall provide at
     least one hour of general training to the first group of
     Covered Persons as specified below. This training shall
     explain Tender Loving Care's

                a. CIA requirements; and

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

                All training materials shall be made available to
                OIG, upon request.

     Those Covered Persons who have already received at least one
hour of general training on the Compliance Program within one
hundred and twenty (120) days prior to the Effective Date of this
CIA need only to be trained about the existence and requirements
of this CIA.

     Tender Loving Care will provide this general training to
thirty-five percent of all Covered Persons, including the Covered
Persons at the Port St. Lucie facility and the Tender Loving Care
headquarters, within 90 days of the effective date of PPS. Tender
Loving Care will provide general training to all the remaining
Covered Persons no later than one year after the effective date
of this CIA. New Covered Persons shall receive the general
training described above within 30 days of becoming a Covered
Person or within 90 days after the effective date of PPS,
whichever is later. After receiving the initial training
described above, each Covered Person shall receive at least one
hour of refresher training sessions annually.

                2. Specific Training. Within 120 days of the
effective date of this CIA, each Covered Person who works
primarily in the Corporate Quality Assurance and Billing
Departments and is involved in the preparation or submission of
claims for reimbursement (including cost reports or equivalent
reporting mechanisms) from any Federal health care program
(hereinafter referred to as "Relevant Covered Persons") shall
receive at least 6 hours of specific training in addition to the
general training required above. This specific training shall
include a discussion of

                  a. the submission of accurate bills for services
                  rendered to Federal health care program patients;

                  b. policies, procedures and other requirements
                  applicable to the documentation of medical
                  records;

                  c. the personal obligation of each individual
                  involved in the billing process to ensure that
                  such billings are accurate;

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

                  e. the legal sanctions for improper billings; and

                  f. examples of proper and improper billing
                  practices.

All training materials shall be made available to OIG, upon
request.  Persons providing the training must be knowledgeable
about the proper coding and billing for services rendered to
Federal health care program beneficiaries.

If Tender Loving Care has provided specific training that
satisfies the requirements set forth above in Section III.C.2 to
Relevant Covered Persons within one hundred and twenty (120) days
prior to the Effective Date of this CIA, OIG shall credit that
training for purposes of satisfying Tender Loving Care's specific
training obligations for the first year of this CIA.

      New Relevant Covered Persons shall receive this training
within 30 days of the beginning of their employment or becoming
Relevant Covered Persons or within 120 days of the effective date
of PPS, whichever is later. A Tender Loving Care 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
preparation or submission of claims for reimbursement from any
Federal health care program, until such time as the new Relevant
Covered Person completes the applicable training.

      After receiving the initial training described in this
section, every Relevant Covered Person shall receive refresher
training sessions annually during the period of this CIA. These
refresher training sessions shall provide thorough and meaningful
training on the items specified above in Section III.C.2.

             3. Certification. Each individual who is required to
attend training shall certify, in writing, or in electronic form,
if available, 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 his or her
designee) shall retain the certifications, along with all course
materials. These shall be made available to OIG, upon request.

      D. Review Procedures.

       1. Retention of Independent Review Organization. Within 120
days of the effective date of this CIA, Tender Loving Care shall
retain an independent review organization ("IRO"), such as an
accounting, auditing, or consulting firm, to perform review
engagements to assist Tender Loving Care in evaluating its
billing and coding practices and its compliance obligations
pursuant to this CIA and the Settlement Agreement. The IRO must
have expertise-in the billing, coding, reporting (including
preparation of cost reports), and other requirements of Federal
health care programs from which Tender Loving Care seeks
reimbursement.

      2. Types of Reviews to Be Conducted.

     a) Tender Loving Care shall conduct a Billing Review in
accordance with the provisions outlined below in Section III.D.4
using its internal audit personnel. The internal audit personnel
conducting the Billing Review must have expertise in the billing,
coding, reporting, and other requirements of the Federal health
care programs from which Tender Loving Care seeks reimbursement.

     b) The IRO(s) shall conduct two separate engagements. First,
the IRO shall conduct a review to determine whether Tender Loving
Care has performed the internal Billing Reviews in conformance
with agreed-upon procedures described below in Section III.D.4
(Verification Review). Second, the IRO shall conduct a review to
determine whether Tender Loving Care has complied with the
obligations assumed under this CIA and the Settlement Agreement
(Compliance Review).

     3. Frequency of Billing, Verification and Compliance
Reviews. The Billing and Verification Reviews shall be performed
annually and shall cover each of the one-year periods beginning
with the effective date of PPS. The Compliance Review shall be
performed by the IRO for the first one-year period beginning with
the effective date of PPS.

      4. Design of Billing Reviews.

      a) Selection of Facilities Subject to Review: The annual
Billing Review shall consist of a review of a sample of Medicare
claims from each of one-tenth of the total number of distinct
Tender Loving Care Medicare certified home health locations'
("TLC Medicare Locations"). In addition, every year the Billing
Review shall include a review of a sample of Medicare claims for
the Port St. Lucie location. Tender Loving Care shall

      I     For purposes of the audit provisions of this CIA, the
term "locations" means physical locations, staffed by
administrators and other personnel where clinical records are
maintained and from which Tender Loving Care provides Medicare
services. The term location is not synonymous with a Medicare
provider number and the Parties recognize that one Medicare
provider number may apply to more than one location. The term
"locations" does not include Tender Loving Care "drop sites" -
that is, sites utilized solely for purposes of dropping off
patient records and payroll documentation which is then
transported to other Tender Loving Care locations. Tender Loving
Care has represented to the OIG that the drop sites are
maintained for the convenience-of the caregivers, no clinical
records are maintained at the drop sites and no administrators
are located at such sites. select the other TLC Medicare
Locations to be reviewed (other than the Port St. Lucie location)
at random with all TLC Medicare Locations in the universe of
potential selections. If, during the term of this CIA, either the
OIG or Tender Loving Care determines that a method other than a
random selection method would identify a sample of more pertinent
locations for review, the Parties agree to consider adopting that
alternative method of selection, subject to final approval by the
OIG. If, during the term of this CIA, the number of TLC Medicare
Locations increases substantially, either TLC or the OIG may
propose an alternate percentage or population of such locations
to be reviewed in accordance with this Section III.D.4 subject to
final review by the OIG.

     b) Selection of Units for Review and Protocol for Review:
Except for the Port St. Lucie location, for each Medicare
location selected, Tender Loving Care shall review a randomly
selected sample of 30 units (each unit shall consist of the file
of a Medicare beneficiary as it represents all claims submitted
for thirty days of service). For the Port St. Lucie location, the
sample size of units subject to review shall be determined
through the use of a probe sample. The probe sample must contain
at least 30 sample units from a representative universe of units
and cannot be used as part of the full sample. The full sample
must contain a sufficient number of units so that when the sample
results are projected to the population of units for the Port St.
Lucie location, the projection provides a minimum 90% confidence
level and precision of at least twenty-five percent (25%).

      Each of the unit samples referenced above must be selected
through random number sampling. In addition, unless otherwise
agreed by the OIG and Tender Loving Care, the sample of TLC
Medicare Locations subject to annual audit shall be selected
through random number sampling. To generate the random samples,
Tender Loving Care shall use OIG's Office of Audit Services
Statistical Sampling Software, also known as "RAT-STATS", which
is available through the Internet at 66
www.hhs.gov/progorg/oas/ratstat.html."

      Tender Loving Care shall review the sample units in
accordance with section I of the Tender Loving Care audit tool,
Client Case and Documentation (attached hereto as Exhibit A).

       c) Components for Inclusion in Billing Review Reports: Each
annual Billing Review and its corresponding report shall include
the following components:

      1. Billing Review Objective: a clear statement of the
objective intended to be achieved by the Billing Review and the
procedures or combination of procedures that will be applied to
achieve the objective.

      2. Billing Review Population: the identity of the
population, which is the group about which information is needed
and an explanation of the methodology used to develop the
population and provide the basis for this determination.

      3. Sources of Data: a full description of the source of the
information upon which the Billing Review conclusions will be
based, including the legal or other standards applied, documents
relied upon, payment data, and/or any contractual obligations.

      4. Sampling Unit: a definition of the sampling unit, which
is any of the designated elements that comprise the population of
interest. For the Billing Review, a sampling unit shall be the
file of a Medicare beneficiary representing all claims submitted
for that beneficiary for up to thirty days of service.

      5. Sampling Frame: the identity of the sampling frame, which
is the totality of the sampling units from which the sample will
be selected.

       d) Findings of Billing Review: Tender Loving Care's annual
Billing Reviews shall provide:

                  1. Findings regarding Tender Loving Care's billing
            operations (including, but not limited to, operations
            of the billing systems, internal control, and the
            strengths, weaknesses and effectiveness of the
            systems);

                  2. Findings regarding whether Tender Loving Care
            is submitting accurate claims for services billed to
            Federal health care programs. The analysis will focus
            on the risk areas identified in this CIA and any
            applicable risk areas identified in the OIG's
            Compliance Program Guidance for Home Health Agencies,
            63 Federal Register 42409 (August 7, 1998). For
            example, the analysis will examine whether Federal
            health care patients met coverage criteria (e.g.,
            homebound) when they received services from Tender
            Loving Care;

                  3. Findings regarding Tender Loving Care's
            compliance with the requirements of the Federal health
            care programs for home health services. Specifically,
            the reviews shall provide findings regarding whether
            Tender Loving Care is submitting accurate information
            to Federal health care programs regarding home health
            patients and whether Tender Loving Care is meeting all
            requirements of the Federal health care programs;

            4. Findings regarding Tender Loving Care's procedures
            to correct inaccurate billings or codings for claims
            submitted to Federal health care programs; and

            5. Findings regarding the steps Tender Loving Care is
            taking or has taken to bring its operation into
            compliance or to correct programs identified by any
            audits or by any Regional Home Health Intermediary and
            whether the problems have been corrected.

            CIA Compliance Review: For the first year of the term
            of the CIA, the IRO shall conduct a Compliance Review
            to provide an assessment of whether Tender Loving Care
            has complied with the terms of the Settlement Agreement
            and this CIA. The report produced by the IRO shall
            include section-by-section findings regarding Tender
            Loving Care's fulfillment of the its obligations under
            this CIA. The report shall also contain a determination
            whether Tender Loving Care has complied with its
            obligations not to charge to, or otherwise seek payment
            from, Federal or State payors for unallowable costs (as
            defined in the Settlement Agreement) and its obligation
            to identify to any such applicable payors any
            unallowable costs included in payments previously
            sought from the United States or any State Medicaid
            program in accordance with the side letter agreement on
            this issue entered between the OIG and Tender Loving
            Care.

            6. Billing and Compliance Review Reports: The IRO(s)
            and Tender Loving Care's audit staff will produce
            written reports for each Billing, Verification and
            Compliance Review. The reports shall include all of the
            information required to be provided by this CIA in each
            respective Review. A complete copy of these reports
            will be included in each of the annual Reports
            submitted to the OIG. The Billing Review reports shall
            include the methodology used to make each
            determination, the review results, and the
            identification of overpayments.

            7. OIG Review. In the event the OIG has reason to
            believe that: (a) Tender Loving Care's Billing,
            Verification or Compliance Reviews fail to conform to
            the requirements of this CIA or (b) the findings of the
            reports of such Reviews are inaccurate, the OIG may, at
            its sole discretion, conduct its own review to
            determine whether the Billing, Verification or
            Compliance Reviews comply with the requirements of the
            CIA and/or the findings of the. reports of such Reviews
            are inaccurate. Tender Loving Care agrees to pay for
            the reasonable cost of any such review' performed by
            the OIG or any of its designated agents so long as it
            is initiated before one year after the final report is
            submitted. Prior to proceeding with such an independent
            review, the OIG shall notify Tender Loving Care of its
            intent to do so and its reasons for believing such a
            review is necessary, and shall in good faith attempt to
            resolve any Billing, Verification or Compliance Review
            issues without proceeding with an independent review.

      E. Confidential Disclosure Program.

      Tender Loving Care has established and will maintain for the
term of this CIA a Confidential Disclosure Program, which
includes 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
Tender Loving Care's policies, 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. Tender Loving Care shall continue to
publicize the existence of the confidential disclosure mechanism
(e.g., via periodic e-mails to employees or by posting the
information in prominent common areas).

      The Confidential Disclosure Program shall continue to
emphasize a non-retribution, non-retaliation policy, and shall
continue to include a reporting mechanism for anonymous,
confidential communications. 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 sufficient information 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, Tender Loving Care shall conduct an internal
review of the allegations set forth in such a disclosure and
ensure that proper follow-up is conducted.

      The Compliance Officer (or his or her designee) shall
maintain a confidential disclosure log, which shall include a
record and summary of each disclosure received, the status of the
respective internal reviews, and any corrective action taken in
response to the internal reviews.  The confidential disclosure
log shall be available to OIG, upon request.

      F. Ineligible Persons.

             1. Definition. For purposes of this CIA, an
"Ineligible Person" shall be any individual or entity who: (a) is
currently excluded, debarred or otherwise ineligible to
participate in the Federal health care programs or in Federal
procurement or non-procurement programs; or (b) has been
convicted of a criminal offense related to the provision of
health care items or services, but has not yet been excluded,
debarred or otherwise declared ineligible.

           2. Screening Requirements. Tender Loving Care shall not
hire or engage as contractors any Ineligible Person. To prevent
hiring or contracting with any Ineligible Person, Tender Loving
Care shall screen all prospective employees and prospective
contractors prior to engaging their services by: (a) requiring
applicants to disclose whether they are Ineligible Persons; and
(b) reviewing the General Services Administration's List of
Parties Excluded from Federal Programs (available through the
Internet at http://epls.amet.gov) and the HHS/OIG List of
Excluded Individuals/Entities (available through the Internet at
http://www.hhs.gov/oig) (these lists will hereinafter be referred
to as the "Exclusion Lists").

            3. Review and Removal Requirement. Within 120 days of
the effective date of this CIA, Tender Loving Care shall review
its list of current employees and contractors against the
Exclusion Lists. Thereafter, Tender Loving Care shall review the
list semi-annually. In addition, Tender Loving Care shall require
employees and contractors to disclose immediately any debarment,
exclusion or other event that makes the employee an Ineligible
Person.

      If Tender Loving Care has notice that an employee or
contractor has become an Ineligible Person, Tender Loving Care
shall remove such person from responsibility for, or involvement
with, Tender Loving Care's business operations related to the
Federal health care programs and shall remove such person from
any position for which the person's salary or the items or
services rendered, ordered, or prescribed by the 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 person is reinstated into participation in the Federal
health care programs.

            4. Pending Charges and Proposed Exclusions. If  Tender
Loving Care has notice that an employee or contractor is charged
with a criminal offense related to any Federal health care
program, or is proposed for exclusion during his or her
employment or contract, Tender Loving Care shall take all
appropriate actions to ensure that the responsibilities of that
employee or contractor 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 of discovery, Tender Loving Care shall notify
OIG, in writing, of any ongoing investigation or legal proceeding
conducted or brought by a governmental entity or its agents
involving an allegation that Tender Loving Care 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. Tender Loving Care shall also
provide written notice to OIG within 30 days of the resolution of
the matter, and shall provide OIG with a description of the
findings and/or results of the proceedings, if any.

      H. Reporting

            1. Overpayments

                  a. Definition of Overpayments. For purposes of
                  this CIA, an " overpayment" shall mean the amount
                  of money Tender Loving Care has received in
                  excess of the amount due and payable under any
                  Federal health care program requirements. Tender
                  Loving Care may not subtract any underpayments
                  for purposes of determining the amount of
                  relevant "overpayments", but may report both the
                  overpayment and underpayment numbers to the OIG.

                  b. Reporting of Overpayments. If, at any time,
                  Tender Loving Care identifies or learns of any
                  overpayments, Tender Loving Care shall notify the
                  payor (e.g. Medicare fiscal intermediary or
                  carrier) and repay any identified overpayments
                  within 30 days of discovery (or such additional
                  time as may be agreed to by the payor) and take
                  remedial steps within 60 days of discovery (or
                  such additional time as may be agreed to by the
                  payor) to correct the problem, including
                  preventing the underlying problem and the
                  overpayments from recurring. Notification and
                  repayment to the contractor should be done in
                  accordance with the contractor policies, and for
                  Medicare contractors, must include the
                  information contained on the Overpayment Refund
                  Form, provided as Attachment B to this CIA.

            2. Material Deficiencies.

                  a. Definition of Material Deficiency. For
                  purposes of this CIA, a "Material Deficiency"
                  means anything that involves:

                  (i) a substantial overpayment; or

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

                  A Material Deficiency may be the result of an
                  isolated event or a series of occurrences.

                  b. Reporting of Material Deficiencies. If Tender
                  Loving Care determines that there is a Material
                  Deficiency, Tender Loving Care shall notify OIG,
                  in writing, within 30 days of making the
                  determination that the Material Deficiency exists.
                  The report to the OIG shall include the following
                  information:

                  (i) If the Material Deficiency results in an
                  overpayment, the report to the OIG shall be made
                  at the same time as the notification to the payor
                  required in section III.H. 1, and shall include
                  all of the information on the Overpayment Refund
                  Form, as well as:

                  (A) the payor's name, address, and contact person
                  to whom the overpayment was sent; and

                  (B) the date of the check and identification
                  number (or electronic transaction number) on which
                  the overpayment was repaid/refunded;

                  (ii) a complete description of the Material
                  Deficiency, including the relevant facts, persons
                  involved, and legal and Federal health care
                  program authorities implicated;

                  (iii) a description of Tender Loving Care's
                  actions taken to correct the Material Deficiency;
                  and

                  (iv) any further steps Tender Loving Care plans to
                  take to address the Material Deficiency and
                  prevent it from recurring.

IV.   NEW BUSINESS UNITS OR LOCATIONS

     In the event that, after the effective date of this CIA,
Tender Loving Care changes locations or purchases or establishes
new business units related to the furnishing of items or services
that may be reimbursed by Federal health care programs, Tender
Loving Care shall notify OIG of this fact as soon as possible,
but no later than within 30 days of the date of change of
location, purchase or establishment. This notification shall
include the location of the new operation(s), phone number, fax
number, Medicare provider number(s) (if any), and the
corresponding contractor's name and address that has issued each
Medicare provider number. All Covered Persons at such locations
shall be subject to the applicable requirements in this CIA (e.g,
completing certifications and undergoing training).

V.            IMPLEMENTATION AND ANNUAL REPORTS

     A. Implementation Report . Within 150 days after the
effective date of this CIA, Tender Loving Care shall submit a
written report to OIG summarizing the status of its
implementation of the requirements of this CIA.  This
Implementation Report shall include:

            1. the name, address, phone number and position
            description of the Compliance Officer required by
            section III.A;

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

            3. a copy of Tender Loving Care's Code of Conduct
            required by section

            4. the summary of the Policies and Procedures required
            by section III.B.2;

            5. a description of the training (required by section
            III.C) that has been conducted to date, including a
            description of the targeted audiences, length of
            sessions, which sessions were mandatory and for whom,
            percentage of attendance, and a schedule of when the
            training sessions were held;

            6. a certification by the Compliance Officer:

                      a. that the Policies and Procedures required
                      by section III.B have been developed, are
                      being implemented, and have been made
                      available to all appropriate Covered Persons;

                      b. that all Covered Persons have completed the
                      Code of Conduct certification required by
                      section III.B.1; and

                      c. as to the percentage of the Covered
                      Persons, including those at the Port. St.
                      Lucie and headquarters locations, who have
                      completed the applicable training and executed
                      the certification(s) required by section III.C

                      The documentation supporting this
                      certification shall be available to OIG, upon
                      request.

              7. a description of the Confidential Disclosure
Program required by section III-E;

              8. the identity of the IRO(s) and the proposed
start and completion dates of the first Verification Review and
the Compliance Review;

              9. a summary of personnel actions (other than
hiring) taken  pursuant to section III  F.;

             10. a list Of all of Tender Loving Care's locations
(including locations and mailing addresses, the corresponding
name under which each location is doing business, the
corresponding phone numbers and fax numbers, each location's
Medicare provider identification number(s) and the contractor's
name and address that issued each provider identification number;

              11.  to the extent not already furnished to OIG, or
if modified, a description of Tender Loving Care's corporate
structure, including identification of any parent and sister
companies, subsidiaries and their respective lines of business;
and

              12. The Certification required by section V.C.

           B. Annual Reports
                          Tender Loving Care shall submit to OIG
Annual Reports with respect to the status of audit findings
regarding of Tender Loving Care's compliance activities for each
of the five one-year periods beginning on the effective date of
PPS (The one-year period covered by each Annual Report shall be
referred to as "the Reporting Period").

     Each Annual Report shall include:

              1. any change in the identity or position
description of the Compliance Officer and/or members of the
Compliance Committee described in section

              2. a certification by the Compliance Officer that:

                      a. all Covered Persons have completed the
                      annual Code of Conduct certification required
                      by section III.B. 1;

                      b. a11 Covered Persons have completed the
                      applicable training and executed the
                      certification(s) required by section III.C;

                      c. Tender Loving Care has complied with its
                      obligations under the Settlement Agreement:
                      (i) not to resubmit to any Federal health care
                      program payors any previously denied claims
                      related to the Covered Conduct addressed in
                      the Settlement Agreement, and not to appeal
                      any such denials of claims., and (ii) not to
                      charge to or otherwise seek payment from
                      Federal or state payors for unallowable costs
                      (as defined in the Settlement Agreement) and
                      to identify and adjust any past charges or
                      claims for unallowable costs in accordance
                      with The side letter agreement entered between
                      Tender Loving Care and the OIG.

              The documentation supporting this certification
shall be available to OIG, upon request.

              3. 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);

              4. a description of the training required by
section III.C conducted during The Reporting Period, including a
description of the targeted audiences, length of sessions, which
sessions were mandatory and for whom, percentage of attendance,
and a schedule of when the training sessions were held;

              5. a complete copy of all reports prepared pursuant
to the Billing, Validation and Compliance Reviews, including a
copy of the methodology used, along with a copy of the IRO's
engagement letter;

              6. Tender Loving Care's response and corrective
action plan(s) related to any issues raised by the IRO(s);

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

              8. a report of the aggregate overpayments that have
been returned to the Federal health care programs. Overpayment
amounts should be broken down into the following categories:
Medicare, Medicaid (report each applicable state separately) and
other Federal health care programs;

              9. a summary of the disclosures in the confidential
disclosure log required by section III.E that; (a) relate to
Federal health care programs; or (b) allege abuse or neglect of
patients;

              10. a description of any personnel actions (other
than hiring) taken by Tender Loving Care as a result of the
obligations in section III F, and the name, title and
responsibilities of any person that falls within the ambit of
section III.F.4, and the actions taken in response to the
obligations set forth in that section.;

              11. 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;
and

              12. a description of all changes to the most
recently provided list (as updated) of Tender Loving Care's
locations (including locations and mailing addresses) as required
by section V.A.10, the corresponding name under which each
location is doing business, the corresponding phone numbers and
fax numbers, each location's Federal health care program provider
identification number(s), and the contractor name and address
that issued each provider identification number, and

              13. The certification required by section V.C.

                      The first Annual Report shall be received by
the OIG no later than one year and 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 tbat: (1) except as otherwise described in the
applicable report, Tender Loving Care is in compliance with all
of the requirements of This CIA, to the best of his or her
knowledge; and (2) the Compliance Officer has reviewed the Report
and has made reasonable inquiry regarding its content and
believes that the information is accurate and truthful.

I

          D. Designation of Information: Tender Loving Care shall
clearly identify any portions of its submissions that it believes
are trade secrets, or information that is commercial or financial
or privileged or confidential, and Therefore exempt from
disclosure under the Freedom of Information Act ("FOIA'), 5
U-S,C.  552. Tender Loving Cue shall refrain from identifying
any information as exempt from disclosure if that information
does not meet the criteria for exemption from disclosure under
F01A.

     V1. Notifications and Submission of Reports

           Unless otherwise stated in writing after the effective
date of this CIA, all notifications and reports required underr
this CIA shall be submitted to the following entities:

     OIG:
                      Civil Recoveries Branch - Compliance Unit
                      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, SW
                      Washington, DC 20201

                      Phone 202.619.2078
                      Fax202,205,0604

     Tender Loving Care:

                      Reriee J. Silver, Esq.
                      Vice President And General Counsel
                      Tender Loving Care/Staff Builders
                      1983 Marcus Avenue
                      Lake Success, NY 11042
                      Phone 516.327,3372
                      Fax 516.327.8636

      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.

      V11. 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 Tender Loving Care's books, records, and other documents
      and supporting materials and/or conduct on-site reviews of
      any of Tender Loving Care's locations for The purpose of
      verifying and evaluating(a) Tender Loving Care's compliance
      with the terms of this CIA and (b) Tender Loving Care's
      compliance with the requirements of the Federal health care
      programs in which it participates, The documentation
      described above shall be made available by Tender Loving
      Cue 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
      Tender Loving Care's employee's, 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. Tender Loving Care agrees to assist 01P
      or its duly authorized representative(s) in contacting and
      arranging interviews with such individuals upon OIG's
      request. Tender Loving Care's employees may elect to be
      interviewed with or without a representative of Tender
      Loving Care present.

VIII.     DOCUMENT AND RECORD RETENTION

          Tender Loving Care shall maintain for inspection all
documents and records relating to reimbursement from the federal
health care programs, or to compliance with this CIA, for six
years or longer if otherwise required by law).

     JX.   Disclosures

          Consistent with HHS's FOIA procedures, set forth in 45
C.F.R- Part 5. the OIG shall make a reasonable effort: to notify
Tender Loving Care prior to any release by OIG of information
submitted by Tender Loving Care pursuant to its obligations under
this CIA and identified upon submission by Tender Loving Care as
trade secrets, or information that is commercial or financial and
privileged or confidential, under the FUIA rules. With respect To
such releases, Tender Loving Care shall have the rights set forth
at 45 C.F.R. 5.65(d). Tender Loving Care shall refrain from
identifying any information as exempt from release if that
information does not meet the criteria for exemption from
disclosure under FOIA. Nothing In this CIA, or any communication
or report made pursuant to this CIA, shall constitute or be
construed as any waiver by Tender Lover Care of Tender Loving
Care's attorney-client, work product or other applicable
privileges.

Not withstanding that fact, the existence of any such privileges
does not affect Tender Loving Care's obligation to comply with
the provisions of this CIA.

     X.    BREACH AND DEFAULT PROVISIONS

          Tender Loving Care 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, Tender Loving Care
and OIG hereby agree that failure to comply with certain
obligations 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 become
due) for each day Tender Loving Care fails to have in place any
of the following:

                      a. Compliance Officer (or Acting Compliance
                      Officer) as described by section III.A. 1;

                      b. a Compliance Committee as described by
                      section III.A.2,

                      c. a written Code of Conduct as described by
                      section III.B.1;

                      d. written Policies & Procedures as described
                      by section III,B.2;

                      e. a  requirement that Covered Persons be
                      trained as described in section W,C; and

                      f. a Confidential Disclosure Program as
                      described in section III.E.

                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 Tender Loving Care fails to retain an IRO, as
required in section 111.1).

                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 Tender Loving Care fails to meet any of the
deadlines for the submission of the Implementation Report or The
Annual Reports to OIG.

                4. A Stipulated Penalty of $2,000 (which shall
begin to accrue on the date the failure to comply began) for each
day Tender Loving Care employs or contracts with an Ineligible
Person and the person: (i) has responsibility for, or involvement
with, Tender Loving Care's business operations related to the
federal health care programs; or (ii) is in a position for which
the person's salary or the items or services rendered, ordered,
or prescribed by the person are paid in whole Or part, directly
or indirectly, by Federal health care pros or otherwise with
Federal funds (the Stipulated Penalty described in this paragraph
shall not be demanded for any time period during which Tender
Loving Care can demonstrate that it did not discover the person's
exclusion or other ineligibility after making a reasonable
inquiry (as described in section ULF) as to the status of the
person):

                5. A Stipulated Penalty of $ 1,500 for each day
Tender Loving Care fails to grant access to the information or
documentation as required in section VU of this CLA,(This
Stipulated Penalty shall begin to accrue on the date Tender
Loving Care fails to grant access.)

                6. A Stipulated Penalty of $1,000 for each day
Tender Loving Care fails to comply fully and adequately with any
obligation of this CLA. not already covered in paragraphs 1-5. In
its notice to Tender Loving Care, OIG shall state the specific
grounds for its determination that Tender Loving Care has failed
to comply fully and adequately with the CIA obligation(s) at
issue and steps the Tender Loving Care must take to comply with
the CIA. (This Stipulated Penalty shall begin To accrue 10 days
after the date that OIG provides notice to Tender Loving Care of
the failure to comply.) With respect to the Stipulated Penalty
provison described in this section X.A,6 only, the OIG shall not
seek a Stipulated Penalty if Tender Loving Care demonstrates to
the OIG's satisfaction that the alleged failure to comply could
not be cured within The 10-day period, but that. (i) Tender
Loving Care has begun to take action to cure the failure to
comply, (ii)Tender Loving Care is pursuing such action with due
diligence, and (iii) Tender Loving Care has provided to OIG a
reasonable timetable for curing the failure to comply.

          R. Timely Written Requests for Extensions Tender Loving
Care 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 Tender Loving Care 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 two business days after Tender
Loving Care 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.

           C. Payment of Stipulated Penalties.

                1. Demand Letter. Upon a finding that Tender Loving
Care has failed to comply with any of the obligations described
in section XA and after determining that Stipulated Penalties are
appropriate, OIG shall notify Tender Loving Care of, (a) Tender
Loving Care's failure to comply; and (b) the OIG's exercise of
its contractual right to demand payment of the Stipulated
Penalties (this notification is hereinafter referred to as the
'Demand Letter').

                2. Response to Demand Letter. Within 10 days of the
receipt of the Demand Letter, Tender Loving Care 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 ("ALF") to dispute OIG's determination
of noncompliance, pursuant to the agreed upon provisions set
forth below in section X.E. In the event Tender Loving Care
elects to request an ALJ hearing, the Stipulated Penalties shall
continue to accrue until Tender Loving Care cures, to OIG's
satisfaction, the alleged breach in dispute. Failurle 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 XD,

                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 VT.

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

           D. EXCLUSION FOR MATERIAL BREACH OF THIS CIA

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

                      a. a failure by Tender Loving Care to report a
                      material deficiency, take corrective action
                      and make the appropriate refunds, as required
                      in section ULH; I

                      b. a: repeated or flagrant violation of the
                      obligations under this CIA, including, but not
                      limited to, the obligations addressed in
                      section

                      c. a failure to respond to a Demand Lettcr
                      concerning the payment of Stipulated Penalties
                      in accordance with section XC; or

                      d. failure to retain oruse an Independent
                      Review Organization 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 Tender
Loving Care constitutes an independent basis for Tender Loving
Care's exclusion from participation in The Federal health care
programs. Upon a determination by 6IG that Tender Loving Care has
materially breached this CIA and that exclusion should be
imposed, OIG shall notify Tender Loving Care of (a) Tender Loving
Care's  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. Tender Loving Care 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. Tender Loving Care is in full compliance
                     with this CIA;

                     b. the alleged material breach has been cured;
                     or

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

              4. Exclusion Letter. If at the conclusion of the
30-day period, Tender Loving Care fails to satisfy the
requirements of section X.D.3, OIG may exclude Tender Loving Care
from participation in the Federal health care programs. OIG will
notify Tender Loving Care in writing of its determination to
exclude Tender Loving Care (this letter shall be referred to
hereinafter as the "Exclusion Letter"). Subject to the Dispute
Resolution provisions in section XE, below, the exclusion shall
go into effect 30 days after the date of the Exclusion Letter.
The exclusion shall have national effect and shall also apply to
all other Federal procurement and non-procurement programs.
Reinstatement to program participation is not automatic. If at
the end of the period of exclusion, Tender Loving Care wishes to
apply for reinstatement, Tender Loving Care must submit a written
request for reinstatement in accordance with the provisions at 42
C.F.R. 1001.3001,30P4.

          E. Dispute Resolution

                1. Review Rights. Upon OIG's delivery to Tender
Loving Care 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, Tender Loving Care shall be
afforded certain review rights comparable to the ones that are
provided in 42 LJ,S-C- 1320a-70 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 ALJ and, in the event of an appeal by
TLC or the 01 the Departmental Appeals Board ("DAB"), in a manner
consistent with the provisions in 42 C.F.R. 1005.2-1005,21.
Notwithstanding the language in 42 C.F.R. I 005.2(c), the
request for a hearing involving Stipulated Penalties shall be
made within 10 days of the receipt of the Demand Letter and the
request for a hearing involving exclusion shall be made within 25
days of receipt of the Exclusion Letter.

                2. Stipulated Penalties Review. Notwithstanding any
provision of Title 42 of the United States Co or Chapter 42 of
the Code of Federal Regulations, the only issues in a proceeding
for Stipulated Penalties under this CIA shall be: (a) whether
Tender Loving Care was in full and timely compliance with the
obligations of this CIA for which The OIG demands payment, (b)
the period of noncompliance, and (c) with respect to a Stipulated
Penalty authorized under section X.A.6 only, whether the failure
to comply could not be cured within the 1O-day period, but that
by the end of that period (i) Tender Loving Care had begun to
take action to cure the failure to comply, (ii)Tender Loving Care
was and is pursuing such action with due diligence, and (iii)
Tender Loving Care had provided to OIG a reasonable timetable for
curing the material breach which is being followed. Tender Loving
Care shall have the burden of proving its fall and timely
compliance and the steps taken to cure the noncompliance, if any.
If the ALJ agrees with OIG with regard to a finding of a breach
of This CIA and orders Tender Loving Care to pay Stipulated
Penalties, such Stipulated Penalties shall become due and payable
20 days after the ALJ issues such a decision unless Tender Loving
Care 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.

                3. Exclusionn Review. Notwithstanding any provision
of Title 42 of the United States Code or chapter 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 Tender Loving Care 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) Tender Loving Care had begun to take
                           action to cure the material breach within
                           that period,

                           (ii) Tender Loving Care has pursued and
                           is pursuing such action with due
                           diligence; And

                           (iii) Tender Loving Care provided to OIG
                           within that period a resonable timetable
                           for curing the material breach and Tender
                           Loving Care 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 The Tender Loving Care, only after a DAB
     decision in favor of OIG. Tender Loving Care's election of
     its contractual right To appeal to the DAB shall not
     abrogate the OIG's authority to exclude Tender Loving Care
     upon the issuance of an ALJs decision in favor of the OIG.
     If the ALJ sustains the determination of the 01G, and
     determines that exclusion is authorized, such exclusion
     shall take effect 20 days after the ALI issues such a
     decision, notwithstanding that Tender Loving Care may
     request review of the ALI decision by the DAB. If the DAB
     finds in favor of OIG after an decision adverse to OIG, the
     exclusion shall take effect 20 days after the DAB decision.

                4. Finality of Decision. The review by an ALI 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
ALI's decision if not appealed) shall be considered final for all
purposes under this CIA.

     XI EFFECTIVE AND BINDING AGREEMENT

          Consistent with the provisions in the Settlement
Agreement pursuant to which this CIA is entered, and into which
this CIA is incorporated, Tender Loving Care and OIG agree as
follows:

          A. This CIA shall be binding on the successors, assigns,
and transferees of Tender Loving Care. However, OIG shall waive
this successor liability provision upon receipt of verified proof
to the OIG's satisfaction that Tender Loving Care has wholly
divested itself of any interest or involvement, direct or
indirect, in the transferred or assigned entity, that the
successor is an independent entity unrelated in any manner to
Tender Loving Care, that the successor has acquired its interest
at fair market value in an arms' length transaction, and that the
successor has policies, procedures and practices in effect to
ensure its compliance with the requirements of Medicare, Medicaid
and all other Federal health care programs;

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

          C. Any modifications to this CIA shall be made with the
prior written consent of the parties to this CIA; and

          D. The undersigned Tender Loving Care 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.

                           ON BEHALF OF TENDER LOVING CARE

/s/ Dale R. Clift                             August 18, 2000
Dale R. Clift                                 Date
President & Chief Operating Officer
Tender Loving Care

ON BEHALF OF THE OFFICE OF INSPECTOR GENERAL
OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES

/s/ Lewis Morris                           August, 2000
LEWIS MORRIS                               DATE
Assistant Inspector General for Legal Affairs
Office of Inspector General
U. S. Department of Health and Human Services

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