Document:

exv10w6w4

 

Exhibit 10.6.4

STATE OF NEW JERSEY

DEPARTMENT OF HUMAN SERVICES

DIVISION OF MEDICAL ASSISTANCE AND HEALTH SERVICES

AND

AMERIGROUP NEW JERSEY, INC.

AGREEMENT TO PROVIDE HMO SERVICES

In accordance with Article 7, section 7.11.2A and 7.11.2B of the contract
between AMERIGROUP New Jersey, Inc. and the State of New Jersey, Department of
Human Services, Division of Medical Assistance and Health Services (DMAHS),
effective date October 1, 2000, all parties agree that certain sections of the
contract shall be amended to take effect November 1, 2003, as follows:

 

 

	1.	 	Article 4, “Provision of Health Care Services, “ Sections 4.1.5(C),
4.1.5(D), 4.1.6(A)3 and 4.1.7(C)13 shall be amended as reflected in
Article 4, Sections 4.1.5(C), 4.1.5(D), 4.1.6(A)3 and 4.1.7(C)13 attached
hereto and incorporated herein.
	 
	2.	 	Article 5, “Enrollee Services,” Sections 5.8.2(M) and 5.8.2(U) shall be
amended as reflected in Article 5, Sections 5.8.2(M) and 5.8.2(U) attached
hereto and incorporated herein.
	 
	3.	 	Article 8, “Financial Provisions,” Section 8.5.6 shall be amended as
reflected in Section 8.5.6 attached hereto and incorporated herein.
	 
	4.	 	Appendix, Section B, “Cost-Sharing Requirements for NJ FamilyCare Plan C,
Plan D and Plan H Beneficiaries”, B.5.2, Plan H co-pays shall be amended
as reflected in Section B, B.5.2 attached hereto and incorporated herein.

 

 

All other terms and conditions of the October 1, 2000 contract and
subsequent amendments remain unchanged except as noted above.

The contracting parties indicate their agreement by their signatures. AMERIGROUP

	 	 	 	 
	 	 	
          State of New Jersey
	    
        New Jersey, Inc.	 	
Department of Human Services
	 	 	 	 
	BY: /s/ Norine Yukon	 	
BY:	 
	
	 	
          Ann Clemency Kohler
	TITLE: President & CEO	 	
TITLE: Director, DMAHS
	DATE: 10/27/03	 	
DATE:	 
	 	 	 	

APPROVED AS TO FORM ONLY

Attorney General State of New

Jersey

BY: Deputy Attorney General

 

 

	 	 	an enrollee’s risk factors, 3) development of a plan of care, 4) referrals and
assistance to ensure timely access to providers, 5) coordination of care
actively linking the enrollee to providers, medical services, residential,
social, and other support services where needed, 6) monitoring, 7) continuity
of care, and 8) follow-up and documentation.
	 
	 	 	Centers for Medicare and
Medicaid Services (CMS) - formerly the Health Care
Financing Administration (HCFA) within the U.S. Department of Health and Human
Services.
	 
	 	 	Certificate of Authority—a license granted by the New Jersey Department of
Banking and Insurance and the New Jersey Department of Health and Senior
Services to operate an HMO in compliance with N.J.S.A. 26:2J-l et. seq.
	 
	 	 	Children’s Health Care Coverage Program--means the program established by the
“Children’s Health Care Coverage Act”, P.L. 1997, c.272 as a health insurance
program for targeted, low-income children.
	 
	 	 	Children with Special Health Care Needs—those children who have or are at
increased risk for chronic physical, — developmental, behavioral, or emotional
conditions and who also require health and related services of a type and
amount beyond that required by children generally.
	 
	 	 	Chronic Illness—a disease or condition of long duration (repeated inpatient
hospitalizations, out of work or school at least three months within a
twelve-month period, or the necessity for continuous health care on an ongoing
basis), sometimes involving very slow progression and long continuance. Onset
is often gradual and the process may include periods of acute exacerbation
alternating with periods of remission.
	 
	 	 	Clinical Peer—a physician or other health care professional who holds a
non-restricted license in New Jersey and is in the same or similar specialty as
typically manages the medical condition, procedure, or treatment under review.
	 
	 	 	CNM or Certified Nurse Midwife—a registered professional nurse who is legally
authorized under State law to practice as a nurse-midwife, and has completed a
program of study and clinical experience for nurse-midwives or equivalent.
	 
	 	 	CNP or Certified Nurse Practitioner—a registered professional nurse who is
licensed by the New Jersey Board of Nursing and meets the advanced educational
and clinical practice requirements beyond the two to four years of basic
nursing education required of all registered nurses.
	 
	 	 	CNS or Clinical Nurse Specialist—a person licensed to practice as a registered
professional nurse who is licensed by the New Jersey State Board of Nursing or
similarly licensed and certified by a comparable agency of the state in which
he/she practices.
	 
	 	 	Cold Call Marketing—any unsolicited personal contact with a potential enrollee
by an employee or agent of the contractor for the purpose of influencing the
individual to enroll

	 	 	 
	Amended as of November 1, 2003	 	
I-4

 

 

	 	C.	 	Up to twelve (12) inpatient hospital days required for social
necessity in accordance with Medicaid regulations.
	 
	 	D.	 	DDD/CCW waiver services: individual supports (which includes
personal care and training), habilitation, case management, respite,
and Personal Emergency Response Systems (PERS).

	4.1.5	 	INSTITUTIONAL FEE-FOR-SERVICE
BENEFITS - NO COORDINATION BY THE
CONTRACTOR
	 
	 	The following institutional services shall remain in the fee-for-service
program without requiring coordination by the contractor. In addition,
Medicaid beneficiaries participating in a waiver (except the Division of
Developmental Disabilities Community Care Waiver) or demonstration
program or admitted for long term care treatment in one of the following
shall be disenrolled from the contractor’s plan on the date of admission
to institutionalized care.

	 	A.	 	Nursing Facility care (Exception: if the admission is only
for inpatient rehabilitationlpostacute care services and is 30 days
or less, the enrollee will not be disenrolled. The contractor
remains financially responsible for services in this setting for 30
days. Thereafter, if the enrollee continues to receive services in
this setting, the enrollee will be disenrolled. The contractor will
no longer be financially responsible.) Not covered for NJ FamilyCare
Plans B and C.
	 
	 	B.	 	Inpatient psychiatric services (except for RTCs) for
individuals under age 21 and 65 and over — Services that are
provided:

	 	1.	 	Under the direction of a physician;
	 
	 	2.	 	In a facility or program accredited by the Joint
Commission on Accreditation of Health Care Organizations; and
	 
	 	3.	 	Meet the federal and State requirements.

	 	C.	 	Intermediate Care Facility/Mental Retardation Services -
Items and services furnished in an intermediate care facility for
the mentally retarded. Covered for NJ FamilyCare Plan A only.
	 
	 	D.	 	Waiver (except Division of Developmental Disabilities
Community Care Waiver) and demonstration program services. Covered
for NJ FamilyCare Plan A only.

	4.1.6	 	BENEFIT PACKAGE FOR NJ FAMILYCARE PLAN D

	 	A.	 	Services Included In The Contractor’s Benefits Package
for NJ FamilyCare Plan D.
	 	 	 	     The following services shall be
provided and case managed by the contractor:

	 	1.	 	Primary Care

	 	 	 
	Amended as of November 1, 2003	 	
N-10

 

 

	 	a.	 	All physicians services, primary and specialty
	 
	 	b.	 	In accordance with state certificationllicensure
requirements, standards, and practices, primary care providers
shall also include access to certified nurse midwifes, certified
nurse practitioners, clinical nurse specialists, and physician
assistants
	 
	 	c.	 	Services rendered at independent clinics that provide
ambulatory services
	 
	 	 	 	Federally Qualified Health Center primary care services

	 	2.	 	Emergency room services
	 
	 	3.	 	     Family Planning Services, including medical history and physical
examinations (including pelvic and breast), diagnostic and laboratory
tests, drugs and biologicals, medical supplies and devices, counseling,
continuing medical supervision, continuity of care and genetic counseling
	 
	 	 	 	Services provided primarily for the diagnosis and treatment of
infertility, including sterilization reversals, and related office
(medical and clinic) visits, drugs, laboratory services, radiological
and diagnostic services and surgical procedures are not covered by the
NJ FamilyCare program. Obtaining family planning services from
providers outside the contractor’s provider network is not available to
NJ FamilyCare Plan D enrollees, except for those Plan D enrollees with
program status code 380.
	 
	 	4.	 	     Home Health Care Services — Limited to skilled nursing for a home bound
beneficiary which is provided or supervised by a registered nurse, and
home health aide when the purpose of the treatment is skilled care; and
medical social services which are necessary for the treatment of the
beneficiary’s medical condition
	 
	 	5.	 	Hospice Services
	 
	 	6.	 	     Inpatient Hospital Services, including general hospitals, special
hospitals, and rehabilitation hospitals. The contractor shall not be
responsible when the primary admitting diagnosis is mental health or
substance abuse related.
	 
	 	7.	 	Outpatient Hospital Services, including outpatient surgery

	 	 	 
	Amended as of November 1, 2003	 	
IV-11

 

 

	 	12.	 	Durable Medical Equipment - excludes any equipment not listed in Appendix,
Section B.4.1, and not covered if not part of inpatient hospital discharge
plan
	 
	 	13.	 	Early and Periodic Screening, Diagnosis and Treatment (EPSDT) services
	 
	 	14.	 	Transportation Services, including non-emergency ambulance, invalid
coach, and lower mode transportation
	 
	 	15.	 	Hearing Aid Services
	 
	 	16.	 	Blood and Blood Plasma, except administration of blood, processing of
blood, processing fees and fees related to autologous blood donations are
covered.
	 
	 	17.	 	Cosmetic Services
	 
	 	18.	 	Custodial Care
	 
	 	19.	 	Special Remedial and Educational Services
	 
	 	20.	 	Experimental and Investigational Services
	 
	 	21.	 	Medical Supplies (except diabetic supplies)
	 
	 	22.	 	Infertility Services
	 
	 	23.	 	Rehabilitative Services for Substance Abuse
	 
	 	24.	 	Weight reduction programs or dietary supplements, except operations,
procedures or treatment of obesity when approved by the contractor
	 
	 	25.	 	Acupuncture and acupuncture therapy, except when performed as a form of
anesthesia in connection with covered surgery
	 
	 	26.	 	Temporomandibular joint disorder treatment, including treatment performed
by prosthesis placed directly in the teeth
	 
	 	27.	 	Recreational therapy
	 
	 	28.	 	Sleep therapy
	 
	 	29.	 	Court-ordered services
	 
	 	30.	 	Thermograms and thermography
	 
	 	31.	 	Biofeedback
	 
	 	32.	 	Radial keratotomy
	 
	 	33.	 	Respite Care
	 
	 	34.	 	Inpatient hospital services for mental health
	 
	 	35.	 	Inpatient and outpatient services for substance abuse
	 
	 	36.	 	Partial hospitalization

	 	 	 
	Amended as of November 1,
2003	 	
IV-17

 

 

	 	H.	 	An explanation of the process for accessing emergency services
and services which require or do not require referrals;
	 
	 	I.	 	A definition of the terms “emergency medical condition” and
“post stabilization care services” and an explanation of the
procedure for obtaining emergency services, including the need to
contact the PCP for urgent care situations and prior to accessing
such services in the emergency room;
	 
	 	J.	 	An explanation of the importance of contacting the PCP
immediately for an appointment and appointment procedures;
	 
	 	K.	 	An explanation of where and how twenty-four (24) hour per
day, seven (7) day per week, emergency services are available,
including out-of-area coverage, and procedures for emergency and
urgent health care service, including the fact that the enrollee has
a right to use any hospital or other setting for emergency care;
	 
	 	L.	 	A list of the Medicaid and/or NJ FamilyCare services not
covered by the contractor and an explanation of how to receive
services not covered by this contract including the fact that such
services may be obtained through the provider of their choice
according to regular Medicaid program regulations. The contractor
may also assist an enrollee or, where applicable, an authorized
person, in locating a referral provider;
	 
	 	M.	 	A notification of the enrollee’s right to obtain family
planning services from the contractor or from any appropriate
Medicaid participating family planning provider (42 C.F.R. §
431.51(b)); as well as an explanation that enrollees covered under
NJ FamilyCare Plan D (except PSC 380) may only obtain family
planning services through the contractor’s provider network, and
that family planning services outside the contractor’s provider
network are not covered services.
	 
	 	N.	 	A description of the process for referral to specialty and
ancillary care providers and second opinions;
	 
	 	O.	 	An explanation of the reasons for which an enrollee may
request a change of PCP, the process of effectuating that change,
and the circumstances under which such a request may be denied;
	 
	 	P.	 	The reasons and process by which a provider may request an
enrollee to change to a different PCP;
	 
	 	Q.	 	An explanation of an enrollee’s rights to disenroll or
transfer at any time for cause; disenroll or transfer in the first
90 days after the latter of the date the individual enrolled or the
date they receive notice of enrollment and at least every twelve
(12) months thereafter without cause and that the lock-in period
does not apply to ABD, DDD or DYFS individuals;

 

 

	 	R.	 	Complaints and Grievances/Appeals

	 	1.	 	Procedures for resolving complaints, as approved by the DMAHS;
	 
	 	2.	 	A description of the grievance/appeal procedures
to be used to resolve disputes between a contractor and an
enrollee, including: the name, title, or department,
address, and telephone number of the person(s) responsible
for assisting enrollees in grievance/appeal resolutions; the
time frames and circumstances for expedited and standard
grievances; the right to appeal a grievance determination
and the procedures for filing such an appeal; the time
frames and circumstances for expedited and standard appeals;
the right to designate a representative; a notice that all
disputes involving clinical decisions will be made by
qualified clinical personnel; and that all notices of
determination will include information about the basis of
the decision and further appeal rights, if any;
	 
	 	3.	 	The contractor shall notify all enrollees in
their primary language of their rights to file grievances
and appeal grievance decisions by the contractor;

	 	S.	 	An explanation that Medicaid/NJ FamilyCare Plan A enrollees,
and Plan D enrollees with a program status code of 380, have the
right to a Medicaid Fair Hearing with DMAHS and the appeal process
through the DHSS for Medicaid and NJ FamilyCare enrollees,
including instructions on the procedures involved in making such a
request;
	 
	 	T.	 	Title, addresses, phone numbers and a brief description of
the contractor’s plan
for contractor management/service personnel;
	 
	 	U.	 	The interpretive, linguistic, and cultural services
available through the contractor’s persennelplan;
	 
	 	V.	 	An explanation of the terms of enrollment in the
contractor’s plan, continued enrollment, automatic re-enrollment,
disenrollment procedures, time frames for each procedure, default
procedures, enrollee’s rights and responsibilities and causes for
which an enrollee shall lose entitlement to receive services under
this contract, and what should be done if this occurs;
	 
	 	W.	 	A statement strongly encouraging the enrollee to obtain a
baseline physical and dental examination, and to attend scheduled
orientation sessions and other educational and outreach
activities;
	 
	 	X.	 	A description of the EPSDT program, and language encouraging
enrollees to
make regular use of preventive medical and dental services;
	 
	 	Y.	 	Provision of information to enrollees or, where applicable, an
authorized person,
to enable them to assist them in the selection of a PCP;

	 	 	 
	Amended as of November 1, 2003	 	
V - 15

 

 

	 	KK.	 	An explanation of the appropriate uses of the Medicaid/NJ
FamilyCare identification card and the contractor identification
card;
	 
	 	LL.	 	A notification, whenever applicable, that some primary care
physicians may employ other health care practitioners, such as nurse
practitioners or physician assistants, who may participate in the
patient’s care;
	 
	 	MM.	 	The enrollee’s or, where applicable, an authorized person’s
signed authorization on the enrollment application allows release of
medical records;
	 
	 	NN.	 	Notification that the enrollee’s health status survey
(obtained only by the HBC) will be sent to the contractor by the
Health Benefits Coordinator;
	 
	 	00.	 	A notice that enrollment and disenrollment is subject to
verification and approval by DMAHS;
	 
	 	PP.	 	An explanation of procedures to follow if enrollees receive
bills from providers of
services, in or out of network;
	 
	 	QQ.	 	An explanation of the enrollee’s financial responsibility
for payment when services are provided by a health care provider
who is not part of the contractor’s organization or when a
procedure, treatment or service is not a covered health care
benefit by the contractor and/or by Medicaid;
	 
	 	RR.	 	A written explanation at the time of enrollment of the
enrollee’s right to terminate enrollment, and any other
restrictions on the exercise of those rights, to conform to 42
U.S.C. § 1396b(m)(2)(F)(ii). The initial enrollment information and
the contractor’s member handbook shall be adequate to convey this
notice and shall have DMAHS approval prior to distribution;
	 
	 	SS.	 	An explanation that the contractor will contact or
facilitate contact with, and require its PCPs to use their best
efforts to contact, each new enrollee or, where applicable, an
authorized person, to schedule an appointment for a complete,
age/sex specified  specific baseline physical, and for
enrollees with special needs who have been identified through a
Complex Needs Assessment as having complex needs, the development
of an Individual Health Care Plan at a time mutually agreeable to
the contractor and the enrollee, but not later than ninety (90)
days after the effective date of enrollment for children under
twenty-one (21) years of age, and not later than one hundred eighty
(180) days after initial enrollment for adults; for adult clients
of DDD, no later than ninety (90) days after the effective date of
enrollment; and encourage enrollees to contact the contractor
and/or their PCP to schedule an appointment;
	 
	 	TT.	 	An explanation of the enrollee’s` rights and
responsibilities which should include, at a minimum, the following,
as well as the provisions found in Standard X in NJ modified
QARI/QISMC in Section B.4.14 of the Appendices.

	 	 	 
	Amended as of November 1, 2003	 	
V - 17

 

 

	 	 	Individuals eligible through NJ FamilyCare Plans A, B, C, and only those
Plan D enrollees with a program status code of 380 and all children
groups shall receive protease inhibitors and other anti-retroviral agents
under the contractor’s plan. All other individuals eligible through NJ
FamilyCare with program status codes of 497-498, 300-301, 700-701, and
763, and all Plan H individuals shall receive protease inhibitors and
other anti-retrovirals (First Data Bank Specific Therapeutic Class Codes
W5C, W5B, W51, W5J, W5K, W5L, W5M and W5N) through Medicaid fee for
service and/or the AIDS Drug Distribution Program (ADDP).
	 
	8.5.7	 	EPSDT INCENTIVE PAYMENT
	 
	 	 	The contractor shall be paid separately, $10 for every documented
encounter record for a contractor-approved EPSDT screening examination.
The contractor shall be required to pass the $10 amount directly to the
screening provider.
	 
	 	 	The incentive payment shall be reimbursed for EPSDT encounter records
submitted in accordance with 1) procedure codes specified by DMAHS, and
2) EPSDT periodicity schedule.
	 
	8.5.8	 	ADMINISTRATIVE COSTS
	 
	 	 	The capitation rates, effective July 1, 2003, recognize costs for
anticipated contractor administrative expenditures due to Balanced
Budget Act regulations.
	 
	8.5.9	 	NJ FAMILYCARE PLAN H ADULTS
	 
	 	 	The contractor shall be paid an administrative fee for NJ FamilyCare
Plan H adults without dependent children, and restricted alien parents
excluding pregnant women, as defined in Article One.
	 
	8.6	 	HEALTH BASED PAYMENT SYSTEM (HBPS) FOR THE ABD POPULATION WITHOUT
MEDICARE
	 
	 	 	The DMAHS shall utilize a Health-Based Payment System (HBPS) for
reimbursements for the ABD population without Medicare to recognize
larger average health care costs and greater dispersion around the
average than other DMAHS populations. The contractor shall be reimbursed
not only on the basis of the demographic cells into which individuals
fall, but also on the basis of individual health status.
	 
	 	 	The Chronic Disability Payment System (CDPS) (University of California,
San Diego) is . the HBPS or the system of Risk Adjustment that shall be
used in this contract. The methodology for CDPS specific to New Jersey is
provided in the Actuarial Certification Letter for Risk Adjustment issued
separately to the contractor. Two base capitation rates and a DDD mental
health/substance abuse add-on are developed for this population. These
are:

	 	 	 
	Amended as of November 1, 2003	 	
VIII-9

 

 

COST-SHARING REQUIREMENTS FOR NJ

FAMILYCARE PLAN D AND PLAN H

COPAYMENTS FOR NJ FAMILYCARE - PLAN D AND PLAN H

Copayments will be required of parents/caretakers solely eligible through NJ
FamilyCare Plan D whose family income is between 151% and up to including 200%
of the federal poverty level. The same copayments will be required of children
solely eligible through NJ FamilyCare Plan D whose family income is between
201% and up to and including 350% of the federal poverty level. Exception -
Both Eskimos and Native American Indians under the age of 19 are not required
to pay copayments.

The total family limit (regardless of family size) on all cost-sharing may not
exceed 5% of the annual family income.

Below is listed the services requiring copayments and the amount of each copayment. -

	 	 	 	 	 
	 	 	SERVICE	 	AMOUNT OF COPAYMENT
	 	 	
	 	

	1.	 	
Outpatient Hospital Clinic Visits,

including Diagnostic Testing
	 	$5 copayment for each outpatient clinic visit
that is not for preventive services
	 	 	 	 	 
	2.	 	
Hospital Outpatient Mental Health Visits
	 	$25 copayment for each visit
	 	 	 	 	 
	3	 	
Outpatient Substance Abuse Services for

Detoxification
	 	$5 copayment for each visit
	 	 	 	 	 
	4.	 	
Hospital Outpatient Emergency Services
Covered for Emergency Services only,
including services provided in an outpatient
hospital department or an urgent care
facility. [Note: Triage and medical
screenings must be covered in all
situations.]
	 	$35 copayment; no copayment is required if
the member was referred to the Emergency
Room by his/her primary care provider for
services that should have been rendered in the
primary care provider’s office or if the member
is admitted into the hospital.
	 	 	 	 	 
	5.	 	
Primary Care Provider Services provided

during normal office hours
	 	$5 copayment for each visit (except for well-child
visits in accordance with the recommended schedule
of the American Academy of Pediatrics; lead screening
and treatment; age-appropriate immunizations;
prenatal care; or preventive dental services).
The $5 copayment shall only apply to the first
prenatal visit.

Amended as of November 1, 2003

 

 

	 	 	 	 	 
	 	 	SERVICE	 	AMOUNT OF COPAYMENT
	 	 	
	 	

	6.	 	
Primary Care Provider Services during
	 	$10 copayment for each visit non Office hours and for home visits
	 	 	 	 	 
	7.	 	
Podiatrist Services
	 	$5 copayment for each visit
	 	 	 	 	 
	8.	 	
Optometrist Services
	 	$5 copayment for each visit, except for newborns covered under
fee-for-service.
	 	 	 	 	 
	9.	 	
Outpatient Rehabilitation Services,
including Physical Therapy,
Occupational Therapy, and Speech Therapy
	 	$5 copayment for each visit
	 	 	 	 	 
	10.	 	
Prescription Drugs
	 	$5 copayment. If greater than a 34-day supply of a prescription drug
is dispensed, a $10 copayment applies.
	 	 	 	 	 
	11.	 	
Nurse Midwives
	 	$5 copayment for the first prenatal visit; $10 for
services rendered during non-office hours and
for home visits. No copayment for preventive
services or newborns covered under fee-for-service.
	 	 	 	 	 
	12.	 	
Physician specialist office visits during
	 	$5 copayment per visit normal office hours
	 	 	 	 	 
	13.	 	
Physician specialist office visits during

visits
	 	$10 copayment per visit non-office hours or home
	 	 	 	 	 
	14.	 	
Nurse Practitioners
	 	$5 copayment for each visit (except for preventive care services) $10

copayment per non-office hour visits
	 	 	 	 	 
	15.	 	
Psychologist Services
	 	$5 copayment for each visit
	 	 	 	 	 
	16.	 	
Laboratory and X-ray Services
	 	$5 copayment for each visit that is not part of an office visit

COPAYMENTS FOR NJ FAMILYCARE - PLAN H

Copayments will be required of individuals eligible through NJ FamilyCare Plan
H whose family income is between 151% and up to including 250% of the federal
poverty level.

The total family limit (regardless of family size) on all cost-sharing may not
exceed 5% of the annual family income.

Amended as of November 1, 2003

 

 

Below is listed the services requiring copayments and the amount of each
copayment.

	 	 	 	 	 
	 	 	SERVICE	 	AMOUNT OF COPAYMENT
	 	 	
	 	

	1.	 	
Outpatient Hospital Clinic Visits,

including Diagnostic Testing
	 	$5 copayment for each outpatient clinic
visit that is not for preventive services
	 	 	 	 	 
	2. 	 	
Independent Clinic Visits
	 	$5 copayment for each visit except for

preventive services
	 	 	 	 	 
	3.	 	
Hospital Outpatient Emergency Services
Covered for Emergency Services only,
including services provided in an
outpatient hospital department or an
urgent care facility. [Note: Triage and
medical screenings must be
covered in all situations.]
	 	$35 copayment; no copayment is required
if the member was referred to the
Emergency Room by his/her primary care
provider for services that should have
been rendered in the primary care provider’s
office or if the member is admitted into the
hospital.
	 	 	 	 	 
	4.	 	
Primary Care Provider Services provided

during normal office hours
	 	$5 copayment for each visit (except for
preventive services.)
	 	 	 	 	 
	5.	 	
Primary Care Provider Services during
non-office hours and for home visits
	 	$10 copayment for each visit
	 	 	 	 	 
	6. 	 	
Prescription Drugs
	 	$5 copayment. If greater than a 34-day
supply of a prescription drug is dispensed,
a $10 copayment applies.
	 	 	 	 	 
	7.	 	
Nurse Midwives, non-maternity services;
certified nurse practitioner, clinical
nurse specialist
	 	$5 copayment except for preventive
services; $10 for services rendered during
non-office hours and for home visits.
	 	 	 	 	 
	8.	 	
Physician specialist office visits during

normal office hours
	 	$5 copayment per visit
	 	 	 	 	 
	9.	 	
Physician specialist office visits during

non-office hours or home visits
	 	$10 copayment per visit
	 	 	 	 	 
	10.	 	
Laboratory and X-ray Services
of an office visit
	 	$5 copayment for each visit that is not part

Amended as of November 1,
2003exv10w23w1

 

Exhibit 10.23.1

	 	 	 
	STATE OF TEXAS	 	
HHSC CONTRACT No.: 529-00-139-J

COUNTY OF TRAVIS

AMENDMENT 10

TO THE AGREEMENT BETWEEN THE

HEALTH & HUMAN SERVICES COMMISSION

AND

AMERIGROUP TEXAS, INC.

FOR HEALTH SERVICES

TO THE

CHILDREN’S HEALTH INSURANCE PROGRAM

     THIS CONTRACT AMENDMENT (the “Amendment”) is entered
into between the HEALTH & HUMAN SERVICES COMMISSION (“HHSC”), an
administrative agency within the executive department of the State of Texas,
and AMERIGROUP Texas, Inc. (“CONTRACTOR”), a health
maintenance organization organized under the laws of the State of Texas,
possessing a certificate of authority issued by the Texas Department of
Insurance to operate as a health maintenance organization, and having its
principal office at 1200 Copeland Road, Suite 200, Arlington, Texas 76011.
HHSC and CONTRACTOR may be referred to in this Amendment individually as a
“Party" and collectively as the “Parties.”

     The Parties hereby agree to amend their original contract, HHSC contract
number 529-00-139 (the “Agreement”), as set forth in
Article 2 of this Amendment.

ARTICLE 1. PURPOSE.

Section 1.01  Authorization.

     This Amendment is executed by the Parties in accordance with
Article 8 of the Agreement.

Section 1.02  Effective Date of changes

     (a)  General effective date of changes.

     Except as provided in paragraph (b) of this Section
1.02 below, this Amendment is effective September 1, 2003, and
terminates on the Expiration Date of the Agreement, unless extended or
terminated sooner by HHSC in accordance with the Agreement.

     (b)  Notwithstanding the effective date established under paragraph (a) of
this Section 1.02, Section 2.04 of this
Amendment, which modifies Section 11.06 of the Agreement,
is effective November 1, 2003.

ARTICLE 2. AMENDMENT TO THE OBLIGATIONS OF THE PARTIES.

Section 2.01 General

		
	 	     “The Texas Legislature enacted Senate Bill 418
during its 78th Regular Session. Section 20 of the
bill adds Article 21.03 to Chapter 21, Subchapter E
of the Insurance Code. Article 21.30 provides:

		
	 	     If the commissioner of insurance, in
consultation with the commissioner of health
and human services, determines that a
provision of Section 3A, 3C-J, or 10-12,
Article 3.70-3C, or

			
	HHSC Contract 529-00-139-J	Page 1 of 10	 

 

 

		
	 	10-12, Article 3.70-3C of this code, as added
by Chapter 1024, Acts of the 75th Legislature,
Regular Session, 1997, Section 843.209 or
843.319 of this code, Subchapter J, Chapter
843 of this Code, or Article 21.52Z of this
code will cause a negative fiscal impact on
the state with respect to providing benefits
or services under Subchapter XIX, Social
Security Act (42 U.S.C. Section 1396 et seq.),
as amended, or Subchapter XXI, Social Security
Act (42 U.S.C. Section 1397aa et seq.), as
amended, the commissioner of insurance by rule
shall waive the application of that provision
to the providing of those benefits and
services.

		
	 	     Pursuant to this authority, TDI waived
application of Senate Bill 418 as it pertains to the
above-referenced provisions of the Insurance Code
for CHIP benefits and services. The intent of the
Parties to this Agreement is that, for the
above-referenced provisions of the Insurance Code,
the law in effect immediately prior to the effective
date of Senate Bill 418 will continue to govern the
CONTRACTOR’s performance under this Agreement.
Consequently, all citations in this Agreement to the
above-referenced provisions of the Insurance Code,
their predecessor statutes, and related
administrative rules refer to the laws and rules in
effect immediately prior to the effective date of
Senate Bill 418.”

Section 2.02 Modification to Section 10.02, Time and manner
of premium payment

     Section 10.02, Time and manner of premium payment, is
modified with the addition of a new subsection (d), as follows:

		
	 	     “Section 10.03 Time and manner of Premium Payment
	 
	 	     (d) For the period beginning September 1, 2003
and ending August 31, 2004, CONTRACTOR will be
entitled to a payment in accordance with this
subsection (d). CONTRACTOR will be paid based on per
member/per month premiums and new and current
enrollment figures (including disenrollment
adjustments to previous monthly enrollment totals).
The Administrative Services Contractor will convey
premiums payable information to CONTRACTOR for data
reconciliation and to the Management Services
Contractor. CONTRACTOR must reconcile the data and
report any errors to the Management Services
Contractor by the cut-off date of the next month.
The Management Services Contractor will pay
CONTRACTOR by the first business day following the
14th day of each month. CONTRACTOR must accept
payment for premiums by direct deposit into
CONTRACTOR’s account. For the period beginning
September 1, 2003 and ending August 31, 2004, the
premium rates are:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	CSA #	 	Under Age 1	 	Ages 1-5	 	Ages 6-14	 	Ages 15-18
	
	 	
	 	
	 	
	 	

	CSA #2
	 	$	326.77	 	 	$	66.51	 	 	$	43.56	 	 	$	86.65	 
	CSA #6
	 	$	332.14	 	 	$	67.60	 	 	$	44.30	 	 	$	88.82	 

		
	 	     CONTRACTOR does not bill HHSC, the
Administrative Services Contractor, other state
agencies, or institutions for the monthly premium
payment.”

			
	HHSC Contract 529-00-139-J	Page 2 of 10	 

 

 

Section 2.03 Modifications to Article 11, CHIP Eligibility,
Enrollment, Disenrollment, And Cost-Sharing, of the Agreement

     Sections 11.01, 11.02, 11.03, and 11.04
are replaced with the following language:

		
	 	     “Section 11.01 
CHIP Eligibility.” (a) Generally.

		
	 	     CHIP eligibility will be determined by the
Administrative Services Contractor. The
Administrative Services Contractor will enroll and
disenroll eligible individuals into and out of CHIP.
Parents or guardians will enroll eligible
individuals into a health plan.
	 
	 	     (b) Continuous coverage for first six months.
	 
	 	     A child who is CHIP-eligible will have six
months of continuous coverage. An exception to this
occurs for children enrolled between July 1, 2003
and October 1, 2003, who initially receive 12 months
of continuous coverage, at the time of enrollment.
However, these children will actually begin the
renewal process in the fourth month of coverage and
complete a six-month term of coverage.
	 
	 	     Through September 30, 2003, MEMBER is covered
as of the first day of the month following the
MEMBER’S enrollment. If a MEMBER’S enrollment occurs
after the monthly enrollment cut-off, the MEMBER
will be covered on the first day of the second month
following the month of enrollment. Upon enrollment,
a MEMBER will be issued a Member identification card
by HEALTH PLAN. Coverage will be in effect for an
initial term of six months or the extended time
period for a pregnant MEMBER.
	 
	 	     As of October 1, 2003, children enrolling in
CHIP for the first time, or returning to CHIP after
disenrollment, will be subject to a waiting period
before coverage actually begins. The waiting period
for a child is determined by the date on which
he/she is found eligible for CHIP, and extends for a
duration of 3 months. If the child is found eligible
for CHIP on or before the 15th day of a month, then
the waiting period begins on the first day of that
same month. If the child is found eligible on or
after the 16th day of a month, then the waiting
period begins on the first day of the next month.
Please refer to the table below for examples of how
the waiting period affects the beginning of
coverage. A child will remain covered for a term of
6 continuous months.
	 
	 	     (c) Pregnant Members and infants.
	 
	 	     CONTRACTOR, through electronic means, or the
providers, through calls to the provider hotline,
will notify the Administrative Services Contractor
when a pregnancy is diagnosed. Pregnant members,
with the exception of Legal Permanent Residents and
other legally qualified aliens who are not barred
from Medicaid due to federal eligibility
restrictions, will be referred to Medicaid for
eligibility determination. Those members who are
determined to be

			
	HHSC Contract 529-00-139-J	Page 3 of 10	 

 

 

		
	 	Medicaid eligible will be disenrolled from the
CONTRACTOR. Medicaid coverage will be coordinated to
begin immediately after CHIP eligibility ends so
that there is no gap in health care coverage. In the
event the CONTRACTOR remains unaware of a member’s
pregnancy until delivery, the delivery will be
covered by CHIP. The Administrative Services
Contractor will suspend the Member’s eligibility
expiration date after notification of the delivery
is received. The Administrative Services Contractor
will unsuspend the mother’s eligibility expiration
date and set the mother’s eligibility expiration
date at the later of (1) the end of the second month
following the month of the baby’s birth or (2) the
date when the mother’s eligibility would have
expired if it had not been suspended during her
pregnancy.
	 
	 	     To further ensure the reliability of the data,
families also will be encouraged to notify the
Administrative Services Contractor by phone or in
writing when delivery of a baby to a CHIP-enrolled
Member occurs.
	 
	 	     Most newborns born to CHIP members or CHIP
heads of household will be Medicaid eligible.
Eligibility of newborns must be determined for CHIP
before enrollment can occur. The CHIP Administrative
Services Contractor should be notified as soon after
delivery as possible. For newborns determined to be
CHIP-eligible, the baby will be covered from the
beginning of the month of birth.
	 
	 	     (d) Span of coverage.
	 
	 	     If a Member’s effective date of coverage occurs
while the Member is confined in a hospital, the
CONTRACTOR is responsible for the Member’s costs of
Covered Services beginning on the Effective Date of
Coverage. For each day that the Member is
hospitalized beginning on the Effective Date of
Coverage, HHSC will pay to CONTRACTOR $700 for
non-ICU care and $1400 for ICU care. If a Member is
disenrolled while the Member is confined in a
hospital, CONTRACTOR’s responsibility for the
Member’s costs of Covered Services terminates on the
Date of Disenrollment. Six months after the
Implementation Date, the Parties will review
CONTRACTOR’s data, and if either party believes that
these payments are insufficient, either Party can
instigate the Change Order process set out in
Article 8. The Parties agree to negotiate any
requested Change Order in good faith.”

		
	 	     Section 11.02 Enrollment

		
	 	     “To enroll in CONTRACTOR’s health plan, the
Member’s permanent residence must be located within
CONTRACTOR’s CSA.

		
	 	     HHSC makes no guarantees or representations to
CONTRACTOR regarding the number of eligible Members
who will ultimately be enrolled into CONTRACTOR’s
health plan.

		
	 	     The Administrative Services Contractor will
electronically transmit to CONTRACTOR new Member
information, PCP selections, and change information
applicable to active Members five (5) business days
prior to the first day of each month. This monthly
transmittal date is defined as the “cut-off date.” A
six-month term of coverage begins on the first day
of the month following transmittal of new member
data to

			
	HHSC Contract 529-00-139-J	Page 4 of 10	 

 

 

		
	 	CONTRACTOR. CONTRACTOR must accept all persons who
reside within CONTRACTOR’s CSA and who choose to
enroll in CONTRACTOR’s health plan without regard to
the Member’s health status or any other factor.
	 
	 	     A Member is enrolled in the health plan
initially selected for six (6) months, beginning
with the date that the individual is first covered
by that health plan or the applicable time period if
the Member is pregnant as is set out in section
11.01(c). However, CONTRACTOR must accommodate
Member requests to change health plans for
exceptional reason or good cause including, but not
limited to:

	 	(a)	 	permanent relocation from a CHIP Service Area; or
	 
	 	(b)	 	permanent relocation within
CONTRACTOR’s CSA that necessitates a change
in the Member’s Primary Care Provider that
CONTRACTOR cannot accommodate within the
prescribed TDI access standards.

		
	 	     Additional reasons that qualify as an
exceptional reason or good cause will be determined
by HHSC on a case-by-case basis or by rule. Members
may change health plans the first day of the month
following the month in which exceptional reason or
good cause situation occurred, in accordance with
the same cut-off processing timeframes applied to
new Members. All changes must be handled through the
Administrative Services Contractor. If a Member
changes health plans while the Member is confined in
a hospital, the health plan from which the Member is
moving is responsible for all charges until the
Member is discharged.
	 
	 	     There is no retroactive
enrollment in CHIP.”

		
	 	Section 11.03
Re-enrollment

		
	 	     “At the beginning of the fourth month of
coverage, the Administrative Services Contractor
will send a notice to the family outlining the next
steps for renewal or continuation of coverage. The
Administrative Services Contractor will also send a
notice to CONTRACTOR regarding its Members and to a
community-based outreach organization providing
follow-up assistance in the Members’ areas. To
promote continuity of care for children eligible for
re-enrollment, CONTRACTOR may facilitate
re-enrollment through reminders to Members and other
appropriate means. Failure of the family to respond
to the Administrative Services Contractor’s renewal
notice will result in disenrollment from the plan
and from CHIP.”

		
	 	Section 11.04 Disenrollment due to loss of
eligibility.
	 
	 	     “For those Members who are disenrolled because
they are no longer eligible for CHIP, CONTRACTOR
will receive from the Administrative Services
Contractor notice informing CONTRACTOR that the
Members’ coverage will end on a particular date.
Disenrollment due to loss of eligibility includes,
but is not limited to:

	 	•	 	“Aging-out” when a child turns nineteen;

			
	HHSC Contract 529-00-139-J	Page 5 of 10	 

 

 

	 	•	 	Failure to re-enroll at the conclusion of the
6-month term of coverage;
	 
	 	•	 	Change in health insurance
status, such as a child enrolling in an
employer-sponsored health plan;
	 
	 	•	 	Failure to meet monthly cost-sharing obligation;
	 
	 	•	 	Death of a child;
	 
	 	•	 	The child permanently moves out of the state; and
	 
	 	•	 	Data match with the
Medicaid system indicates dual enrollment in
Medicaid and CHIP.

		
	 	     In most cases, if a child is disenrolled from
CHIP, the child loses his or her CHIP eligibility
and will have to re-apply for a determination of
CHIP eligibility. Children not subject to
re-application include, but are not necessarily
limited to:
	 
	 	     Children who meet reinstatement requirements
after disenrollment due to failure to meet
cost-share obligation; and,
	 
	 	     Children who successfully re-enroll in the
first month after disenrollment due to failure to
re-enroll by the conclusion of their 6-month term of
coverage.
	 
	 	     Regardless of the reason for retroactive
disenrollment, recoupment of premium payments by
HHSC shall be in accordance with section 10.05.
Under no circumstances may HHSC recoup premiums paid
for a period greater than two (2) months.”

Section 2.04 Modification to Section
11.06, Cost-Sharing, of the Agreement

          Section 11.06, Cost-Sharing is
replaced with the following language:

          Section 11.06 Cost-Sharing.

		
	 	     “Health care providers within CONTRACTOR’s
network are responsible for collecting all Member
co-payments and deductibles at the time of service.
Co-payments that families must pay vary according to
their income level. Applicable co-payments effective
as of November 1, 2003 are listed in Cost Sharing
table below. No co-payments apply, at any income
level, to well-child or well-baby visits or
immunizations.
	 
	 	     Upon notification from the Administrative
Services Contractor that a family is approaching its
cost-sharing limit for the term of coverage,
CONTRACTOR will generate and mail to the Member a
new Member ID card, showing that the Member’s
cost-sharing obligation for that term of coverage
has been met. No cost-sharing may be collected from
these Members for the balance of their term of
coverage.
	 
	 	     Except for costs associated with unauthorized
non-emergency services provided to a Member by
out-of-network providers and for non-covered
services, the co-payments and deductibles outlined
in the table below are the only amounts that a
provider may collect from a CHIP-eligible family.

			
	HHSC Contract 529-00-139-J	Page 6 of 10	 

 

 

		
	 	     Federal law prohibits charging co-payments or
deductibles to Members of Native American Tribes. The
Administrative Services Contractor will notify
CONTRACTOR of Members who are Native Americans and
who are not subject to cost-sharing requirements.
CONTRACTOR is responsible for educating providers
about the cost-sharing waiver for this population.
	 
	 	     A CONTRACTOR’s monthly premium payment will not
be reduced for a family’s failure to make its premium
payment. There is no relationship between the per
member/per month amount owed to an CONTRACTOR for
coverage provided during a month and the family’s
payment of its premium obligation for that month.

CHIP COST SHARING

(as of November 1, 2003)

	 	 	 	 	 
	 	 	 	Charge
	At or below 100% of FPL	 	 	(Changes in Bold)
	
	 	 	

	Enrollment Fee	 	 	
$0
	Monthly Premium	 	 	
$0
	Office Visit	 	 	
$ 3
	ER	 	 	
$3
	Generic Drug	 	 	
$0
	Brand Drug	 	 	
$3
	Co-pay Cap	 	 	
1.25% (of family’s income)
	Deductible, non-institutional	 	 	
$0
	Deductible, institutional	 	 	
$0
	Facility Co-pay, Inpatient	 	 	
$10
	Facility Co-pay, Outpatient	 	 	
$0
	101% to 150% of FPL	 	 	
Charge
	Enrollment Fee	 	 	
$ 0
	Monthly Premium	 	 	
$15
	Office Visit	 	 	
$ 5
	ER	 	 	
$5
	Generic Drug	 	 	
$0
	Brand Drug	 	 	
$5
	Co-pay Cap	 	 	
1.25% (of family’s income)
	Deductible, non-institutional	 	 	
$0
	Deductible, institutional	 	 	
$0
	Facility Co-pay, Inpatient (per admission)	 	 	
$25
	Facility Co-pay, Outpatient	 	 	
$0
	151% to 185% of FPL	 	 	
Charge
	Enrollment Fee	 	 	
$ 0
	Monthly Premium	 	 	
$20 per mo./per family
	Office Visit	 	 	
$7
	ER	 	 	
$50
	Generic Drug	 	 	
$5
	Brand Drug	 	 	
$20
	Co-pay Cap	 	 	
2.5% (of family’s income)
	Deductible, non-institutional	 	 	
$0
	Deductible, institutional	 	 	
$0
	Facility Co-pay, Inpatient (per admission)	 	 	
$50
	Facility Co-pay, Outpatient	 	 	
$0
	186% to 200% of FPL	 	 	
Charge
	Enrollment Fee	 	 	
$0
	Monthly Premium	 	 	
$25 per mo./per family

			
	HHSC Contract 529-00-139-J	Page 7 of 10	 

 

 

CHIP COST SHARING

(as of November 1, 2003)

	 	 	 	 	 
	Office Visit	 	 	
$10
	ER	 	 	
$50
	Generic Drug	 	 	
$5
	Brand Drug	 	 	
$20
	Co-pay Cap	 	 	
2.5% (of family’s income)
	Deductible, non-institutional	 	 	
$0
	Deductible, institutional	 	 	
$0
	Facility Co-pay, Inpatient (per admission)	 	 	
$100
	Facility Co-pay, Outpatient	 	 	
$0

	Section2.05 Modification to Article 12, Scope of
CHIP Covered Services, of the Agreement

	 	Section
12.07 is deleted in its entirety and new Section 12.07
is added as follows.
	 
	 	“Section 12.07
Court-ordered Commitments.

		
	 	     [Deleted]
	 
	 	     Section 12.07 In-patient Psychiatric.
	 
	 	     HHSC will reimburse CONTRACTOR for members
receiving services on an inpatient basis in a
psychiatric facility on August 31, 2003, for the
lengths of their stays, based on their contracted
rates with providers. Inpatient psychiatric services
may not extend more than 45 days, including the
length of stay before August 31, 2003.
	 
	 	     The process for reimbursement will be
consistent with new enrollee hospital and
supplemental reimbursement claims submitted on the
Supplemental Claims Form for CHIP Health Plans.”

Section 2.06 Modification to Article
13, Member Services, of the Agreement

	 	Section 13.01 is replaced with the
following language: “Section 13.01 Member Education.
	 

		
	 	     “CONTRACTOR must, at a minimum, develop and
implement health education initiatives that educate
Members about:

	 	(a)	 	How the HMO system operates;
	 
	 	(b)	 	How to obtain services, including:

	 	(1)	 	Accessing OB/GYN and
plan requirements concerning specialty
care;
	 
	 	(2)	 	Emergency services;
	 
	 	(3)	 	Behavioral health care services;

			
	HHSC Contract 529-00-139-J	Page 8 of 10	 

 

 

	 	(4)	 	Care and treatment, under CONTRACTOR’s
plan, for Members with disabilities and
Children with Special Health Care Needs;
and
	 
	 	(5)	 	Early Childhood Intervention (ECI) Services;

	 	(c)	 	Covered Services, limitations
and any Value-added Services offered by
CONTRACTOR;
	 
	 	(d)	 	Member co-payments, if applicable; and
	 
	 	(e)	 	The value of screening and preventive care.

		
	 	     CONTRACTOR also must provide child-oriented,
disease specific-information, and educational
materials to Members.

		
	 	     CONTRACTOR must educate members about the following:

	 	•	 	Requirement that pregnant
members notify CONTRACTOR upon learning of
pregnancy,
	 
	 	•	 	Requirement that
Medicaid-eligible members receive services
through Medicaid,
	 
	 	•	 	The more comprehensive scope
of services provided through Medicaid,
	 
	 	•	 	Automatic newborn coverage
until age one year provided in Medicaid for
babies of mothers enrolled in Medicaid at the
time of delivery,
	 
	 	•	 	Requirement that if a CHIP
member does not notify CONTRACTOR of
pregnancy until or after delivery, the
newborn will have to go through eligibility
determination with the CHIP Administrative
Services Contractor for Medicaid and CHIP
before enrollment can begin.

		
	 	     In addition to the above requirements,
CONTRACTOR must make any additional educational
initiatives outlined in its Proposal appropriately
available to Members.”

			
	HHSC Contract 529-00-139-J	Page 9 of 10	 

 

 

ARTICLE 3. REPRESENTATIONS AND AGREEMENT OF THE PARTIES

     The Parties contract and agree that the terms of the Agreement will remain
in effect and continue to govern except to the extent modified in this
Amendment.

     By signing this Amendment, the Parties expressly understand and agree that
this Amendment is hereby made a part of the Agreement as though it were set out
word for word in the Agreement.

     IN WITNESS HEREOF, HHSC and the CONTRACTOR have each caused this Amendment
to be signed and delivered by its duly authorized representative.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	AMERIGROUP TEXAS, INC.	 	HEALTH AND HUMAN SERVICES COMMISSION
	 
	By:	 	 	 	By:	 	 	 	 	 	 
	 	 	

	 	 	 	 	 	 	 	 
	 	 	James D. Donovan, Jr.	 	Albert Hawkins
	 	 	President and CEO	 	Commissioner
	 
	Date:	 	 	 	Date:	 	 	 	 	 	 
	 	 	

	 	 	 	

			
	HHSC Contract 529-00-139-J	Page 10 of 10

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