Document:

exhibit10-2.htm

    
      
        

      

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8-K

      Exhibit 10.2

       

      

      
        Contract
with Eligible Medicare Advantage (MA) Organization Pursuant
to

      

      
        Sections
1851 through 1859 of the Social Security Act for the
Operation

      

      
        of a
Medicare Advantage Coordinated Care Plan(s)

      

      
        

        CONTRACT
# H1657

      

      
        

        Between

      

      
         

        Centers
for Medicare & Medicaid Services (hereinafter referred to as
CMS)

      

      
         

        and

      

      
        

        Harmony Health Plans of
Illinois, Inc.

      

      
        

        (hereinafter
referred to as the MA Organization)

      

      
        

        CMS and
the MA Organization, an entity which has been determined to be an eligible
Medicare Advantage Organization by the Administrator of the Centers for Medicare
& Medicaid Services under 42 CFR 422.503, agree to the following for the
purposes of sections 1851 through 1859 of the Social Security Act (hereinafter
referred to as the Act):

      

      
        

        (NOTE:
Citations indicated in brackets are placed in the text of this contract to note
the regulatory authority for certain contract provisions. All references to Part
422 are to 42 CFR Part 422.)

      

      
        

        You must check off AND initial each
required Addendum type to reflect the coverage offered under the H (or R) number
associated with this contract

         

      

      
        	
                Addendum
      Type

              	
                Initials

              
	
                  X   Part
      D Addendum

              	
                        
      TF          

              
	
                ____ EGWP ( "800 Series" )
      MA-PD Addendum

              	 
	
                ____EGWP ("800 Series") MA-Only
      Addendum

              	 
	
                ____Variances/Waivers (Provided
      directly to Demonstration Organizations by CMS)

              	 
	
                ____Regional Preferred Provider
      Organization Addendum (Provided directly to RPPOs by
      CMS)

              	 

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article
I

      

      
        

        Term of
Contract

      

      
        

        The term
of this contract shall be from the date of signature by CMS' authorized
representative through December 31,2008, after which this contract may be
renewed for successive one-year periods in accordance with 42 CFR 422.505(c) and
as discussed in Paragraph A in Article VII below. [422.505]

      

      
        

        This
contract governs the respective rights and obligations of the parties as of the
effective date set forth above, and supersedes any prior agreements between the
MA Organization and CMS as of such date. MA organizations offering Part D also
must execute an Addendum to the Medicare Managed Care Contract Pursuant to
Sections 1860D-1 through 1860D-42 of the Social Security Act for the Operation
of a Voluntary Medicare Prescription Drug Plan (hereafter the "Part D
Addendum"). For MA Organizations offering MA-PD plans, the Part D Addendum
governs the rights and obligations of the parties relating to the provision of
Part D benefits, in accordance with its terms, as of its effective
date.

      

      
        

        Article
II

      

      
        

        Coordinated
Care Plan

      

      
        

        A.           The
Medicare Advantage Organization agrees to operate one or more coordinated care
plans as defined in 42 CFR 422.4(a)(l)(iii)), including at least one MA-PD
plan as required under 42 CFR 422.4(c), as described in its final Plan
Benefit Package (PBP) bid submission (benefit and price bid) proposal as
approved by CMS and as attested to in the Medicare Advantage Attestation of
Benefit Plan and Price, and in compliance with the requirements of this
contract and applicable Federal statutes, regulations, and
policies.

         

      

      
        B.           Except
as provided in paragraph (C) of this Article, this contract is deemed to
incorporate any changes that are required by statute to be implemented
during the term of the contract and any regulations or policies
implementing or interpreting such statutory provisions.

         

      

      
        C.           CMS
will not implement, other than at the beginning of a calendar year, requirements
under 42 CFR Part 422 that impose a new significant cost or burden on MA
organizations or plans, unless a different effective date is required by
statute. [422.521]

      

      
        

        Article
III

      

      
        

        Functions
To Be Performed By Medicare Advantage Organization

      

      
        

        A.
PROVISION OF BENEFITS

      

      
        1. The MA
Organization agrees to provide enrollees in each of its MA plans the basic
benefits as required under §422.101 and, to the extent applicable, supplemental
benefits under §422.102 and as established in the MA Organization's final
benefit and price bid proposal as approved by CMS and listed in the MA
Organization Plan Attestation of Benefit Plan and Price, which is-attached to
this contract. The MA Organization agrees to provide access to such benefits
as

      

      
        

        2

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        required
under subpart C in a manner consistent with professionally recognized standards
of health care and according to the access standards stated in
§422.112.

      

      
         

        2. The MA
Organization agrees to provide post-hospital extended care services, should an
MA enrollee elect such coverage, through a skilled nursing home facility
according to the requirements of section 1852(1) of the Act and §422.133. A
skilled nursing home facility is a facility in which an MA enrollee resided at
the time of admission to the hospital, a facility that provides services through
a continuing care retirement community, a facility in which the spouse of the
enrollee is residing at the time of the enrollee's discharge from the hospital,
or hospital, or wherever the enrollee resides immediately before admission for
extended care services. [422.133;
422.504(a)(3)]

      

      
        

        B.           ENROLLMENT
REQUIREMENTS

      

      
        

        1.           The
MA Organization agrees to accept new enrollments, make enrollments effective,
proeess voluntary disenrollments, and limit involuntary disenrollments, as
provided in subpart B of part 422.

      

      
        2.           The
MA Organization shall comply with the provisions of §422.110 concerning
prohibitions against discrimination in beneficiary enrollment, other than in
enrolling eligible beneficiaries in a CMA-approved special needs plan that
exclusively enrolls special needs individuals as consistent with
§§422.2,422.4(a)(l)(iv) and 422.52.

      

      
        

        [422.504(a)(2)]

      

      
        

        C.           BENEFICIARY
PROTECTIONS

      

      
        

        1.           The
MA Organization agrees to comply with all requirements in subpart M of part 422,
governing coverage determinations, grievances, and appeals. [422.504(a)(7)]

      

      
        2.           The
MA Organization agrees to comply with the confidentiality and enrollee record
accuracy requirements in §422.118.

      

      
        3.           Beneficiary Financial
Protections. The MA Organization agrees to comply with the following
requirements:

      

      
        

        (a)           Each
MA Organization must adopt and maintain arrangements satisfactory to CMS
to protect its enrollees from incurring liability for payment of any fees
that are the legal obligation of the MA Organization. To meet this
requirement the MA Organization must--

      

      
        (i)
Ensure that all contractual or other written arrangements with providers
prohibit the Organization's providers from holding any beneficiary enrollee
liable for payment of any fees that are the legal obligation of the MA
Organization; and

      

      
        (ii)
Indemnify the beneficiary enrollee for payment of any fees that are the legal
obligation of the MA Organization for services furnished by providers that do
not contract, or that have not otherwise entered into an agreement with the MA
Organization, to provide services to the organization's beneficiary enrollees.
[422.504(g)(1)]

        (b)  The
MA Organization must provide for continuation of enrollee health care
benefits- 

        (i) For
all enrollees, for the duration of the contract period for which CMS payments
have been
made; and

        (ii) For
enrollees who are hospitalized on the date its contract with CMS terminates, or,
in the event of the MA Organization's insolvency, through the date of discharge.
[422.504(g)(2)]

      

      
        

        3

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (c) In
meeting the requirements of this section (C), other than the provider contract
requirements specified in paragraph (C)(3)(a) of this Article, the MA
Organization may use~ (i) Contractual arrangements; (ii) Insurance acceptable to
CMS; (iii) Financial reserves acceptable to CMS; or (iv) Any other arrangement
acceptable to CMS. [422.504(g)(3)]

      

      
        

        D.           PROVIDER
PROTECTIONS

      

      
        

        1.           The
MA Organization agrees to comply with all applicable provider requirements in 42
CFR Part 422 Subpart E, including provider certification requirements,
anti-discrimination requirements, provider participation and consultation
requirements, the prohibition on interference with provider advice, limits on
provider indemnification, rules governing payments to providers, and limits on
physician incentive plans. [422.504(a)(6)]

      

      
         

        2.           Prompt
Payment.

      

      
        

        (a)           The
MA Organization must pay 95 percent of "clean claims" within 30 days of
receipt if they are claims for covered services that are not furnished
under a written agreement between the organization and the
provider.

      

      
        

        (i) The
MA Organization must pay interest on clean claims that are not paid within 30
days in accordance with sections 1816(c)(2) and 1842(c)(2) of the
Act.

      

      
        

        (ii) All
other claims from non-contracted providers must be paid or denied within 60
calendar days from the date of the request. [422.520(a)]

      

      
        

        (b)           Contracts
or other written agreements between the MA Organization and its providers must
contain a prompt payment provision, the terms of which are developed and agreed
to by both the MA Organization and the relevant provider. [422.520(b)]

         

      

      
        (c)           If
CMS determines, after giving notice and opportunity for hearing, that the MA
Organization has failed to make payments in accordance with subparagraph (2)(a)
of this section, CMS may provide--

      

      
        

        (i) For
direct payment of the sums owed to providers; and (ii) For appropriate reduction
in the amounts that would otherwise be paid to the MA Organization, to reflect
the amounts of the direct payments and the cost of making those payments. [422.520(c)]

      

      
        

        E.           QUALITY
IMPROVEMENT PROGRAM

      

      
        

        1. The MA
Organization agrees to operate, for each plan that it offers, an ongoing quality
improvement program as stated in accordance with Section 1852(e) of the Social
Security Act and 42 CFR 422.152. % Chronic Care Improvement
Program

      

      
        

        (a)            Each
MA organization (other than MA private-fee-for-service plans) must have a
chronic care improvement program and must establish criteria for participation
in the program. The CCIP must have a method for identifying enrollees with
multiple or sufficiently severe chronic conditions who meet the criteria for
participation in the program and a mechanism for monitoring enrollees'
participation in the program.

      

      
        

        (b)            Plans
have flexibility to choose the design of their program; however, in addition to
meeting the requirements specified above, the CCIP selected must be relevant to
the plan's MA

      

      
        

        4

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        population.
MA organizations are required to submit annual reports on their CCIP program to
CMS.

      

      
         

        3.           Performance Measurement and
Reporting: The MA Organization shall measure performance under its MA
plans using standard measures required by CMS, and report (at the organization
level) its performance to CMS. The standard measures required by CMS during the
term of this contract will be uniform data collection and reporting instruments,
to include the Health Plan and Employer Data Information Set (HEDIS), Consumer
Assessment of Health Plan Satisfaction (CAHPS) survey, and Health Outcomes
Survey (HOS). These measures will address clinical areas, including
effectiveness of care, enrollee perception of care and use of services; and
non­clinical areas including access to and availability of services, appeals
and grievances, and organizational characteristics. [422.152(b)(1),
(e)]

      

      
        

        4.           Utilization
Review:

      

      

      
        (a)           An
MA Organization for an MA coordinated care plan must use written protocols for
utilization review and policies and procedures must reflect current standards of
medical practice in processing requests for initial or continued authorization
of services and have in effect mechanisms to detect both underutilization and
over utilization of services. [422.152(b)]

      

      
        

        (b)           For
MA regional preferred provider organizations (RPPOs) and MA local preferred
provider organizations (PPOs) that are offered by an organization that is not
licensed or organized under State law as an HMOs, if the MA Organization uses
written protocols for utilization review, those policies and procedures must
reflect current standards of medical practice in processing requests for initial
or continued authorization of services and include mechanisms to evaluate
utilization of services and to inform enrollees and providers of services of the
results of the evaluation. [422.152(e)]

      

      
        

        5.           Information
Systems:

         

      

      
        (a) The
MA Organization must:

      

      
        (i)
Maintain a health information system that collects, analyzes and integrates the
data necessary to implement its quality improvement
program;

      

      
        (ii)
Ensure that the information entered into the system (particularly that received
from providers) is reliable and complete;

      

      
        (iii)
Make all collected information available to CMS. [422.152(f)(1)]

      

      
        

        6.           External
Review

      

      
        The MA
Organization will comply with any requests by Quality Improvement Organizations
to review the MA Organization's medical records in connection with appeals of
discharges from hospitals, skilled nursing facilities, and home health
agencies.

      

      
        

        F.           COMPLIANCE
PLAN

      

      
        The MA
Organization agrees to implement a compliance plan in accordance with the
requirements of §422.503(b)(4)(vi). [422.503(b)(4)(vi)]

      

      
        

        G.           COMPLIANCE
DEEMED ON THE BASIS OF ACCREDITATION

      

      
        CMS may
deem the MA Organization to have met the quality improvement requirements of §
1852(e) of the Act and §422.152, the confidentiality and accuracy of enrollee
records requirements of § 1852(h) of the Act and §422.118, the
anti-discrimination requirements of §1852(b) of the Act and §422.110, the access
to services requirements of §1852(d) of the Act and §422.112, and the advance
directives requirements of §1852(i) of the Act and §422.128,
the

      

      
        

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        provider
participation requirements of §1852(j) of the Act and 42 CFR Part 422, Subpart
F, and the applicable requirements described in §423.165, if the MA Organization
is fully accredited (and periodically reaccredited) by a private, national
accreditation organization approved by CMS and the accreditation organization
used the standards approved by CMS for the purposes of assessing the MA
Organization's compliance with Medicare requirements. The provisions of §422.156
shall govern the MA Organization's use of deemed status to meet MA program
requirements.

      

      
        

        H.
PROGRAM INTEGRITY

      

      
        1.           The
MA Organization agrees to provide notice based on best knowledge, information,
and belief to CMS of any integrity items related to payments from governmental
entities, both federal and state, for healthcare or prescription drug services.
These items include any investigations, legal actions or matters subject to
arbitration brought involving the MA Organization (or MA Organization's firm if
applicable) and its subcontractors (excluding contracted network providers),
including any key management or executive staff, or any major shareholders (5%
or more), by a government agency (state or federal) on matters relating to
payments from governmental entities, both federal and state, for healthcare
and/or prescription drug services. In providing the notice, the sponsor shall
keep the government informed of when the integrity item is initiated and when it
is closed. Notice should be provided of the details concerning any resolution
and monetary payments as well as any settlement agreements or corporate
integrity agreements.

      

      
        

        2.           The
MA Organization agrees to provide notice based on best knowledge, information,
and belief to CMS in the event the MA Organization or any of its subcontractors
is criminally convicted or has a civil judgment entered against it for
fraudulent activities or is sanctioned under any Federal program involving the
provision of health care or prescription drug services.

      

      
        

        I.
MARKETING

      

      
        1.           The
MA Organization may not distribute any marketing materials, as defined in 42 CFR
422.80(b) and in the Marketing Materials Guidelines for Medicare
Advantage-Prescription Drug Plans and Prescription Drug Plans (Medicare
Marketing Guidelines), unless they have been filed with and not disapproved by
CMS in accordance with §422.80. The file and use process set out at
§422.80(a)(2) must be used, unless the MA organization notifies CMS that it will
not use this process.

      

      
        2.           CMS
and the MA Organization shall agree upon language setting forth the benefits,
exclusions and other language of the Plan. The MA Organization bears full
responsibility for the accuracy of its marketing materials. CMS, in its sole
discretion, may order the MA Organization to print and distribute the agreed
upon marketing materials, in a format approved by CMS. The MA Organization must
disclose the information to each enrollee electing a plan as outlined in 42 CFR
422.111.

      

      
        3.           The
MA Organization agrees that any advertising material, including that labeled
promotional material, marketing materials, or supplemental literature, shall be
truthful and not misleading. All marketing materials must include the Contract
number. All membership identification cards must include the Contract number on
the front of the card.

      

      
        4.           The
MA Organization must comply with the Medicare Marketing Guidelines, as well as
all applicable statutes and regulations, including and without limitation
Section 1851(h) of the Act

      

      
        

        6

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        and 42
CFR §§422.80, 422.111 and 423.50. Failure to comply may result in sanctions as
provided in 42 CFR Part 422 Subpart O.

      

      
        

        Article
IV

      

      
        

        CMS
Payment to MA Organization

      

      
        

        A.          The
MA Organization agrees to develop its annual benefit and price bid proposal and
submit to CMS all required information on premiums, benefits, and cost
sharing, as required under 42 CFR Part 422 Subpart F. [422.504(a)(10)]

      

      
        

        B.          Methodology. CMS
agrees to pay the MA Organization under this contract in accordance with
the provisions of section 1853 of the Act and 42 CFR Part 422 Subpart G. [422.504(a)(9)]

      

      
        

        C.          Attestation of payment data
(Attachments A, B and C).

      

      
        As a
condition for receiving a monthly payment under paragraph B of this article, and
42 CFR Part 422 Subpart G, the MA Organization agrees that its chief executive
officer (CEO), chief financial officer (CFO), or an individual delegated with
the authority to sign on behalf of one of these officers, and who reports
directly to such officer, must request payment under the contract on the forms
attached hereto as Attachment A (enrollment attestation) and Attachment B (risk
adjustment data) which attest to (based on best knowledge,
information and belief, as of the date specified on the attestation form)
the accuracy, completeness, and truthfulness of the data identified on
these attachments. The Medicare Advantage Plan Attestation of Benefit Plan and
Price must be signed and attached to the executed version of this
contract.

      

      
        

        1.           Attachment
A requires that the CEO, CFO, or an individual delegated with the authority to
sign on behalf of one of these officers, and who reports directly to such
officer, must attest based on best knowledge, information, and belief that each
enrollee for whom the MA Organization is requesting payment is validly enrolled,
or was validly enrolled during the period for which payment is requested, in an
MA plan offered by the MA Organization. The MA Organization shall submit
completed enrollment attestation forms to CMS, or its contractor, on a monthly
basis. (NOTE: The forms included as attachments to this contract are for
reference only. CMS will provide instructions for the completion and submission
of the forms in separate documents. MA Organizations should not take any action
on the forms until appropriate CMS instructions become
available.)

      

      
        

        2.           Attachment
B requires that the CEO, CFO, or an individual delegated with the authority to
sign on behalf of one of these officers, and who reports directly to such
officer, must attest to (based
on best knowledge, information and belief, as of the date specified on the
attestation form)
that the risk adjustment data it submits to CMS under §422.310 are
accurate, complete, and truthful. The MA Organization shall make annual
attestations to this effect for risk adjustment data on Attachment B and
according to a schedule to be published by CMS. If such risk adjustment data are
generated by a related entity, contractor, or subcontractor of an MA
Organization, such entity, contractor, or subcontractor must similarly attest to {based on best
knowledge, information,
and belief, as of the date specified on the attestation form) the
accuracy, completeness, and truthfulness of the data. [422.504(1)]

      

      
        

        7

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        3. The
Medicare Advantage Plan Attestation of Benefit Plan and Price (which is attached
hereto) requires that the CEO, CFO, or an individual delegated with the
authority to sign on behalf of one of these officers, and who reports directly
to such officer, must attest (based on best knowledge,
information and belief, as of the date specified on the attestation form)
that the information and documentation comprising the bid submission
proposal is accurate, complete, and truthful and fully conforms to the Bid Form
and Plan Benefit Package requirements; and that the benefits described in the
CMS-approved proposal bid submission agree with the benefit package the MA
Organization will offer during the period covered by the proposal bid
submission. This document is being sent separately to the MA Organization and
must be signed . and attached to the executed version of this contract, and is
incorporated herein by reference. [422.502(1)]

      

      
        

        Article
V

      

      
        

        MA
Organization Relationship with Related Entities, Contractors, and
Subcontractors

      

      
        

        A.           Notwithstanding
any relationship(s) that the MA Organization may have with
related entities, contractors, or subcontractors, the MA Organization
maintains full responsibility for adhering to and otherwise fully complying
with all terms and conditions of its contract with CMS. [422.504(i)(l)]

      

      
        

        B.           The
MA Organization agrees to require all related entities, contractors, or
subcontractors to agree that--

      

      
        (1)           HHS,
the Comptroller General, or their designees have the right to inspect, evaluate,
and audit any pertinent contracts, books, documents, papers, and records of the
related entity(s), contractor(s), or subcontractor(s) involving transactions
related to this contract; and

      

      
        (2)           HHS,
the Comptroller General, or their designees have the right to inspect, evaluate,
and audit any pertinent information for any particular contract period for 10
years from the final date of the contract period or from the date of completion
of any audit, whichever is later. [422.504(i)(2)]

      

      
        

        C.           The
MA Organization agrees that all contracts or written arrangements into which the
MA Organization enters with providers, related entities, contractors, or
subcontractors (first tier and downstream entities) shall contain the
following elements:

      

      
        

        (1)           Enrollee
protection provisions that provide--

      

      
        (a)           Consistent
with Article III(C), arrangements that prohibit providers from holding an
enrollee liable for payment of any fees that are the legal obligation of the MA
Organization; and

        (b)           Consistent
with Article III(C), provision for the continuation of
benefits.

      

      
        (2)           Accountability
provisions that indicate that the MA Organization may only
delegate activities or functions to a provider, related entity, contractor,
or subcontractor in a manner consistent with requirements set forth at
paragraph D of this article.

      

      
        

        8

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (3) A
provision requiring that any services or other activity performed by a related
entity, contractor or subcontractor in accordance with a contract or written
agreement between the related entity, contractor, or subcontractor and the MA
Organization will be consistent and comply with the MA Organization's
contractual obligations to CMS. [422.504(i)(3)]

      

      
        

        D.           If
any of the MA Organization's activities or responsibilities under this contract
with CMS is delegated to other parties, the following requirements apply to
any related entity, contractor, subcontractor, or
provider:

      

      
        (1)           Written
arrangements must specify delegated activities and reporting
responsibilities.

        (2)           Written
arrangements must either provide for revocation of the delegation activities and
reporting requirements or specify other remedies in instances where CMS or the
MA Organization determine that such parties have not performed
satisfactorily.

        (3)           Written
arrangements must specify that the performance of the parties is monitored by
the MA Organization on an ongoing basis.

      

      
        (4)           Written
arrangements must specify that either--

      

      
        (a)           The
credentials of medical professionals affiliated with the party or parties will
be either reviewed by the MA Organization; or

      

      
        (b)           The
credentialing process will be reviewed and approved by the MA Organization and
the MA Organization must audit the credentialing process on an ongoing
basis.

      

      
        (5)           All
contracts or written arrangements must specify that the related entity,
contractor, or subcontractor must comply with all applicable Medicare laws,
regulations, and CMS instructions.

      

      
        

        [422.504(i)(4)]

      

      
        

        E.           If
the MA Organization delegates selection of the providers, contractors, or
subcontractors to another organization, the MA Organization's written
arrangements with that organization must state that the MA Organization
retains the right to approve, suspend, or terminate any such arrangement.
[422.504(i)(5)]

      

      
        

        F.           As
of the date of this contract and throughout its term, the MA
Organization

      

      
        (1)            Agrees
that any physician incentive plan it operates meets the requirements of
§422.208, and

      

      
        (2)            Has
assured that all physicians and physician groups that the MA Organization's
physician incentive plan places at substantial financial risk have adequate
stop-loss protection in accordance with §422.208(f). [422.208]

      

      
        

        9

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article
VI

      

      
        

        Records
Requirements

      

      
        

        A.
MAINTENANCE OF RECORDS

      

      
        1.           The
MA Organization agrees to maintain for 10 years books, records, documents, and
other evidence of accounting procedures and practices
that—

      

      
        (a)           Are
sufficient to do the following:

      

      
        (i)
Accommodate periodic auditing of the financial records (including data related
to Medicare utilization, costs, and computation of the benefit and price bid) of
the MA Organization.

      

      
        (ii)
Enable CMS to inspect or otherwise evaluate the quality, appropriateness and
timeliness of services performed under the contract, and the facilities of the
MA Organization.

      

      
        (iii)
Enable CMS to audit and inspect any books and records of the MA Organization
that pertain to the ability of the organization to bear the risk of potential
financial losses, or to services performed or determinations of amounts payable
under the contract.

      

      
        (iv)
Properly reflect all direct and indirect costs claimed to have been incurred and
used in the preparation of the benefit and price bid
proposal.

      

      
        (v)
Establish component rates of the benefit and price bid for determining
additional and supplementary benefits.

      

      
        (vi)
Determine the rates utilized in setting premiums for State insurance agency
purposes and for other government and private purchasers; and

      

      
        (b)           Include
at least records of the following:

      

      
        (i)
Ownership and operation of the MA Organization's financial, medical, and other
record keeping systems.

        (ii)
Financial statements for the current contract period and six prior
periods.

      

      
        (iii)
Federal income tax or informational returns for the current contract period and
six prior periods.

        (iv)
Asset acquisition, lease, sale, or other action.

        (v)
Agreements, contracts (including, but not limited to, with related or unrelated
prescription
drug benefit managers) and subcontracts.

        (vi)
Franchise, marketing, and management agreements.

        (vii)
Schedules of charges for the MA Organization's fee-for-service
patients.

        (viii)
Matters pertaining to costs of operations.

        (ix)
Amounts of income received, by source and payment.

        (x) Cash
flow statements.

        (xi) Any
financial reports filed with other Federal programs or State authorities.
[422.504(d)]

      

       

      
        2.           Access to facilities and
records. The MA Organization agrees to the following:

      

      
        (a) The
Department of Health and Human Services (HHS), the Comptroller General, or their
designee may evaluate, through inspection or other means-

      

      
        (i) The
quality, appropriateness, and timeliness of services furnished to Medicare
enrollees under the contract;

        (ii) The
facilities of the MA Organization; and

      

      
        

        10

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (iii) The
enrollment and disenrollment records for the current contract period and ten
prior periods.

      

      
        (b)  HHS,
the Comptroller General, or their designees may audit, evaluate, or inspect any
books, contracts, medical records, documents, papers, patient care
documentation, and other records of the MA Organization, related entity,
contractor, subcontractor, or its transferee that pertain to any aspect of
services performed, reconciliation of benefit liabilities, and determination of
amounts payable under the contract, or as the Secretary may deem necessary to
enforce the contract.

      

      
        (c)  The
MA Organization agrees to make available, for the purposes specified in section
(A) of this article, its premises, physical facilities and equipment, records
relating to its Medicare enrollees, and any additional relevant information that
CMS may require, in a manner that meets CMS record maintenance
requirements.

      

      
        (d)  HHS,
the Comptroller General, or their designee's right to inspect, evaluate, and
audit extends through 10 years from the final date of the contract period or
completion of audit, whichever is later unless-

      

      
        (i) CMS
determines there is a special need to retain a particular record or group of
records for a longer period and notifies the MA Organization at least 30 days
before the normal disposition date;

      

      
        (ii)
There has been a termination, dispute, or fraud or similar fault by the MA
Organization, in which case the retention may be extended to 10 years from the
date of any resulting final resolution of the termination, dispute, or fraud or
similar fault; or

      

      
        (iii)
HHS, the Comptroller General, or their designee determines that there is a
reasonable possibility of fraud, in which case they may inspect, evaluate, and
audit the MA Organization at any time. [422.504(e)]

      

      
        

        B.
REPORTING REQUIREMENTS

      

      
        1.           The
MA Organization shall have an effective procedure to develop, compile, evaluate,
and report to CMS, to its enrollees, and to the general public, at the
times and in the manner that CMS requires, and while safeguarding the
confidentiality of the doctor-patient relationship, statistics and other
information as described in the remainder of this section (B). [422.516(a)]

      

      
        2.           The
MA Organization agrees to submit to CMS certified financial information that
must include the following:

      

      
        (a) Such
information as CMS may require demonstrating that the organization has a
fiscally sound operation, including:

        (i) The
cost of its operations;

      

      
        (ii) A
description, submitted to CMS annually and within 120 days of the end of the
fiscal year, of significant business transactions (as defined in §422.500)
between the MA Organization and a party in interest showing that the costs of
the transactions listed in paragraph (2)(a)(v) of this section do not exceed the
costs that would be incurred if these transactions were with someone who is not
a party in interest; or

      

      
        (iii) If
they do exceed, a justification that the higher costs are consistent with
prudent management and fiscal soundness requirements.

      

      
        (iv) A
combined financial statement for the MA Organization and a party in interest if
either of the following conditions is met:

      

      
        

        11

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (aa)
Thirty-five percent or more of the costs of operation of the MA Organization go
to a party in interest.

      

      
        (bb)
Thirty-five percent or more of the revenue of a party in interest is from the MA
Organization. [422.516(b)]

        (v)Requirements for combined
financial statements.

      

      
        (aa) The
combined financial statements required by paragraph (2)(a)(iv) must display in
separate columns the financial information for the MA Organization and each of
the parties in interest.

        (bb)
Inter-entity transactions must be eliminated in the consolidated
column.

      

      
        (cc) The
statements must have been examined by an independent auditor in accordance with
generally accepted accounting principles and must include appropriate opinions
and notes.

      

      
        (dd) Upon
written request from the MA Organization showing good cause, CMS may waive the
requirement that the organization's combined financial statement include the
financial information required in paragraph (2)(a)(v) with respect to a
particular entity. [422.516(c)]

      

      
        (vi) A
description of any loans or other special financial arrangements the MA
Organization makes with contractors, subcontractors, and related
entities.

      

      
        (b)  Such
information as CMS may require pertaining to the disclosure of ownership and
control of the MA Organization. [422.504(f)(l)(ii)]

        (c)   Patterns
of utilization of the MA Organization's services.

      

      
        

        3. The MA
Organization agrees to participate in surveys required by CMS and to submit to
CMS all information that is necessary for CMS to administer and evaluate the
program and to simultaneously establish and facilitate a process for current and
prospective beneficiaries to exercise choice in obtaining Medicare services.
This information includes, but is not limited to:

        (a)  The
benefits covered under the MA plan;

        (b)  The
MA monthly basic beneficiary premium and MA monthly supplemental beneficiary
premium, if any, for the plan.

        (c)   The
service area and continuation area, if any, of each plan and the enrollment
capacity of each plan;

      

      
        (d)  Plan
quality and performance indicators for the benefits under the plan including
— (i) Disenrollment rates for Medicare enrollees electing to receive
benefits through the plan for
the previous 2 years;

      

      
        (ii)  Information on Medicare
enrollee satisfaction;

      

      
        (iii) The patterns of utilization of
plan services;

      

      
        (iv) The availability,
accessibility, and acceptability of the plan's services;

      

      
        (v)  Information on health outcomes
and other performance measures required by CMS;

        (vi) The recent record regarding
compliance of the plan with requirements of this part, as determined by CMS;
and

        (vii)  Other information determined
by CMS to be necessary to assist beneficiaries in making an informed choice
among MA plans and traditional Medicare;

        (e)   Information
about beneficiary appeals and their disposition;

      

      
        (f)    Information
regarding all formal actions, reviews, findings, or other similar actions by
States, other regulatory bodies, or any other certifying or accrediting
organization

        (g)   Any
other information deemed necessary by CMS for the administration or evaluation
of the Medicare program. [422.504(f)(2)]

      

      
        

        12

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        4.    The
MA Organization agrees to provide to its enrollees and upon request, to any
individual eligible to elect an MA plan, all informational requirements under
§422.64 and, upon an enrollee's, request, the financial disclosure information
required under §422.516. [422.504(f)(3)]

      

      
        5.    Reporting and disclosure
under ERISA.

      

      
        (a)           For
any employees' health benefits plan that includes an MA Organization in its
offerings, the MA Organization must furnish, upon.request, the information the
plan needs to fulfill its reporting and disclosure obligations (with respect to
the MA Organization) under the Employee Retirement Income Security Act of 1974
(ERISA).

      

      
        (b)           The
MA Organization must furnish the information to the employer or the employer's
designee, or to the plan administrator, as the term "administrator" is defined
in ERISA. [422.516(d)]

      

      
        6.           Electronic
communication. The MA Organization must have the capacity to communicate
with CMS electronically. [422.504(b)]

      

      
        7.           Risk Adjustment data.
The MA Organization agrees to comply with the requirements in §422.310 for
submitting risk adjustment data to CMS. [422.504(a)(8)]

      

      
        

        Article
VII

      

      
        

        Renewal
of the MA Contract

      

      
        

        A.           Renewal of contract:
In accordance with §422.505, following the initial contract period,
this contract is renewable annually only if-

      

      
        

        (1)           The
MA Organization has not provided CMS with a notice of intention not to renew;
[422.506(a)]

      

      
        (2)           CMS
and the MA Organization reach agreement on the bid under 42 CFR Part 422,
Subpart F; and [422.505(d)]

        (3)           CMS
informs the MA Organization that it authorizes a renewal.

      

      
        

        B.           Nonrenewal
of contract

      

      
        

        (1) Nonrenewal by the
Organization.

      

      
        

        (a)           In
accordance with §422.506, the MA Organization may elect not to renew its
contract with CMS as of the end of the term of the contract for any reason,
provided it meets the time frames for doing so set forth in subparagraphs (b)
and (c) of this paragraph.

        (b)           If
the MA Organization does not intend to renew its contract, it must
notify—

      

      
        (i) CMS,
in writing, by the first Monday in June of the year in which the contract would
end, pursuant to §422.506

      

      
        (ii) Each
Medicare enrollee, at least 90 days before the date on which the nonrenewal is
effective. This notice must include a written description of all alternatives
available for obtaining Medicare services within the service area including
alternative MA plans, Medigap options, and original Medicare and prescription
drag plans and must receive CMS approval prior to
issuance.

      

      
        (iii) The
general public, at least 90 days before the end of the current calendar year, by
publishing a CMS-approved notice in one or more newspapers of general
circulation in each community located in the MA Organization's service
area.

      

      
        

        13

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (c)  CMS
may accept a nonrenewal notice submitted after the applicable annual
non­ renewal notice deadline if—

      

      
        (i) The
MA Organization notifies its Medicare enrollees and the public in accordance
with subparagraph (l)(b)(ii) and (l)(b)(iii) of this section;
and

      

      
        (ii)
Acceptance is not inconsistent with the effective and efficient administration
of the Medicare program.

      

      
        (d) If
the MA Organization does not renew a contract under subparagraph (1), CMS
will not enter into a contract with the Organization for 2 years from the
date of contract separation unless there are special circumstances that
warrant special consideration, as determined by CMS. [422.506(a)]

        (2)CMS decision not to
renew.

      

      
        (a)  CMS
may elect not to authorize renewal of a contract for any of the
following reasons:

      

      
        (i) The
MA Organization's level of enrollment, growth in enrollment, or insufficient
number of contracted providers is determined by CMS to threaten the viability of
the organization under the MA program and or be an indicator of beneficiary
dissatisfaction with the MA plan(s) offered by the organization.

        (ii) For
any of the reasons listed in §422.510(a) [Article VIII, section (B)(1)(a) of
this contract], which would also permit CMS to terminate the
contract.

      

      
        (iii) The
MA Organization has committed any of the acts in §422.752(a) that would support
the imposition of intermediate sanctions or civil money penalties under 42 CFR
Part 422 Subpart O.

      

      
        (iv) The
MA Organization did not submit a benefit and price bid or the benefit and price
bid was not acceptable [422.505(d)]

      

      
        (b)  Notice. CMS shall
provide notice of its decision whether to authorize renewal of the contract
as follows:

      

      
        (i) To
the MA Organization by May 1 of the contract year, except in the event of
(2)(a)(iv) above, for which notice will be sent by September
1.

      

      
        (ii) To
the MA Organization's Medicare enrollees by mail at least 90 days before the end
of the current calendar year.

      

      
        (iii) To
the general public at least 90 days before the end of the current calendar year,
by publishing a notice in one or more newspapers of general circulation in each
community or county located in the MA Organization's service
area.

      

      
        (c)  Notice of appeal
rights. CMS shall give the MA Organization written notice of
its right to reconsideration of the decision not to renew in accordance
with § 422.644. [422.506(b)]

      

      
        

        14

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article
VII

      

      
        Modification
or Termination of the Contract

      

      
        

        A.           Modification
or Termination of Contract by Mutual Consent

      

      
        1.           This
contract may be modified or terminated at any time by written mutual
consent.

      

      
        (a)           If
the contract is modified by written mutual consent, the MA Organization must
notify its Medicare enrollees of any changes that CMS determines are appropriate
for notification within time frames specified by CMS. [422.508(a)(2)]

      

      
        

        (b)           If
the contract is terminated by written mutual consent, except as provided in
section (A)(2) of this Article, the MA Organization must provide notice to its
Medicare enrollees and the general public as provided in section B(2)(b)(ii) and
B(2)(b)(iii) of this Article. [422.508(a)(1)]

      

      
        2.           If
this contract is terminate'd by written mutual consent and replaced the day
following such termination by a new MA contract, the MA Organization is not
required to provide the notice specified in section B of this
article.

      

      
        

        [422.508(b)]

      

      
        

        B.           Termination
of the Contract by CMS or the MA Organization 

        1. Termination by
CMS.

      

      
        (a) CMS
may terminate a contract for any of the following
reasons:

      

      
        (i) The
MA Organization has failed substantially to carry out the terms of its contract
with CMS.

      

      
        (ii)The
MA Organization is carrying out its contract with CMS in a manner that is
inconsistent with the effective and efficient implementation of 42 CFR Part
422.

      

      
        (iii) CMS
determines that the MA Organization no longer meets the requirements of 42 CFR
Part 422 for being a contracting organization.

      

      
        (iv)
There is credible evidence that the MA Organization committed or participated in
false, fraudulent or abusive activities affecting the Medicare program,
including submission of false or fraudulent data.

      

      
        (v) The
MA Organization experiences financial difficulties so severe that its ability to
make necessary health services available is impaired to the point of posing an
imminent and serious risk to the health of its enrollees, or otherwise fails to
make services available to the extent that such a risk to health
exists.

      

      
        (vi) The
MA Organization substantially fails to comply with the requirements in 42 CFR
Part 422 Subpart M relating to grievances and appeals.

      

      
        (vii) The
MA Organization fails to provide CMS with valid risk adjustment data as required
under §422.310 and 423.329(b)(3).

      

      
        (viii)
The MA Organization fails to implement an acceptable quality improvement program
as required under 42 CFR Part 422 Subpart D.

      

      
        (ix) The
MA Organization substantially fails to comply with the prompt payment
requirements in §422.520.

      

      
        (x) The
MA Organization substantially fails to comply with the service access
requirements in §422.112.

      

      
        (xi) The
MA Organization fails to comply with the requirements of §422.208 regarding
physician incentive plans.

      

      
        

        15

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (xii) The
MA Organization substantially fails to comply with the marketing requirements in
422.80.

      

      
        (b) Notice. If CMS
decides to terminate a contract for reasons other than the grounds specified in
section (B)(1)(a) above, it will give notice of the termination as
follows:

      

      
        (i) CMS
will notify the MA Organization in writing 90 days before the intended date of
the termination.

      

      
        (ii) The
MA Organization will notify its Medicare enrollees of the termination by mail at
least 30 days before the effective date of the
termination.

      

      
        (iii) The
MA Organization will notify the general public of the termination at least 30
days before the effective date of the termination by publishing a notice in one
or more newspapers of general circulation in each community or county located in
the MA Organization's service area.

      

      
         

        (c) Immediate termination of
contract by CMS.

      

      
        (i) For
terminations based on violations prescribed in paragraph (B)(l)(a)(v) of this
article, CMS will notify the MA Organization in writing that its contract has
been terminated effective the date of the termination decision by CMS. If
termination is effective in the middle of a month, CMS has the right to recover
the prorated share of the capitation payments made to the MA Organization
covering the period of the month following the contract
termination.

      

      
        (ii) CMS
will notify the MA Organization's Medicare enrollees in writing of CMS'decision
to terminate the MA Organization's contract. This notice will occur no later
than 30 days after CMS notifies the plan of its decision to terminate this
contract. CMS will simultaneously inform the Medicare enrollees of alternative
options for obtaining Medicare services, including alternative MA Organizations
in a similar geographic area and original Medicare.

      

      
        (iii) CMS
will notify the general public of the termination no later than 30 days after
notifying the MA Organization of CMS' decision to terminate this contract. This
notice will be published in one or more newspapers of general circulation in
each community or county located in the MA Organization's service
area.

      

      
        (d)           Corrective action
plan

      

      
        (i) General. Before
terminating a contract for reasons other than the grounds specified in section
(B)(l)(a)(v) of this article, CMS will provide the MA Organization with
reasonable opportunity, not to exceed time frames specified at 42 CFR Part 422
Subpart N, to develop and receive CMS approval of a corrective action plan to
correct the deficiencies that are the basis of the proposed
termination.

        (ii)
Exception. If a
contract is terminated under section (B)(l)(a)(v) of this article, the MA
Organization will not have the opportunity to submit a corrective action
plan.

      

      
        (e)           Appeal rights. If CMS
decides to terminate this contract, it will send written notice to the MA
Organization informing it of its termination appeal rights in accordance with 42
CFR Part 422 Subpart N. [422.510]

      

      
        

        2.
Termination by the MA Organization

      

      
        (a)            Cause for
termination. The MA Organization may terminate this contract if CMS fails
to substantially carry out the terms of the contract.

        (b)            Notice. The MA
Organization must give advance notice as follows:

      

      
        (i) To
CMS, at least 90 days before the intended date of termination. This notice must
specify the reasons why the MA Organization is requesting contract
termination.

      

      
        

        16

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        (ii) To
its Medicare enrollees, at least 60 days before the termination effective date.
This notice must include a written description of alternatives available for
obtaining Medicare services within the service area, including alternative MA
and MA-PD plans, PDP plans, Medigap options, and original Medicare and must
receive CMS approval.

      

      
        

        (iii) To
the general public at least 60 days before the termination effective date by
publishing a CMS-approved notice in one or more newspapers of general
circulation in each community or county located in the MA Organization's
geographic area.

      

      
        

        (c)           Effective date of
termination. The effective date of the termination will be determined by
CMS and will be at least 90 days after the date CMS receives the MA
Organization's notice of intent to terminate.

      

      
        

        (d)           CMS' liability. CMS'
liability for payment to the MA Organization ends as of the first day of the
month after the last month for which the contract is in effect, but CMS shall
make payments for amounts owed prior to termination but not yet
paid.

      

      
        

        (e)           Effect of termination by the
organization. CMS will not enter into an agreement with the MA
Organization for a period of two years from the date the Organization has
terminated this contract, unless there are circumstances that warrant special
consideration, as determined by CMS. [422.512]

      

      
        

        Article
IX

         

      

      
        Requirements
of Other Laws and Regulations

      

      
        A.           The
MA Organization agrees to comply with--

      

      
        (1)           Federal
laws and regulations designed to prevent or ameliorate fraud, waste,
and abuse, including, but not limited to, applicable provisions of Federal
criminal law, the False Claims Act (31 USC 3729 et seq.), and the
anti-kickback statute (section 1128B(b) of the Act): and

        (2)           HIPAA
administrative simplification rules at 45 CFR parts 160,162, and 164. [422.504(h)]

      

      
        

        B.           The
MA Organization maintains ultimate responsibility for adhering to and otherwise
fully complying with all terms and conditions of its contract with CMS,
notwithstanding any relationship(s) that the MA organization may have with
related entities, contractors, or subcontractors. [422.504(i)]

      

      
        

        C.           In
the event that any provision of this contract conflicts with the provisions of
any statute or regulation applicable to an MA Organization, the provisions
of the statute or regulation shall have full force and
effect.

      

      
        

        17

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article
X

      

      
        

        Severability

      

      
        

        The MA
Organization agrees that, upon CMS' request, this contract will be amended to
exclude any MA plan or State-licensed entity specified by CMS, and a separate
contract for any such excluded plan or entity will be deemed to be in place when
such a request is made. [422.504(k)]

      

      
        

        Article
XI

      

      
        

        Miscellaneous

      

      
        

        A.           Definitions.
Terms not otherwise defined in this contract shall have the meaning given
to such terms in 42 CFR Part 422.

      

      
        

        B.           Alteration
to Original Contract Terms. The MA Organization agrees that it has not altered
in any way the terms of this contract presented for signature by CMS. The
MA Organization agrees that any alterations to the original text the MA
Organization may make to this contract shall not be binding on the
parties.

      

      
        

        C.           Approval
to Begin Marketing and Enrollment. The MA Organization agrees that it
must complete CMS operational requirements prior to receiving CMS approval
to begin Part C marketing and enrollment activities. Such activities
include, but are not limited to, establishing and successfully testing
connectivity with CMS systems to process enrollment applications
(or contracting with an entity qualified to perform such functions on the
MA Organization's Sponsor's behalf) and successfully demonstrating
capability to submit accurate and timely price comparison data. To
establish and successfully test connectivity, the MA Organization
must,

      

      
        1)
establish and test physical connectivity to the CMS data center, 2) acquire user
identifications and passwords, 3) receive, store, and maintain data necessary to
perform enrollments and send and receive transactions to and from CMS, and 4)
check and receive transaction status information.

      

      
        

        D.           Incorporation
of Applicable Addenda. All addenda checked off and initialed on the
cover sheet of this contract by the MA Organization are hereby incorporated
by reference.

      

      
        

        18

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      In witness whereof, the parties hereby execute this
contract.

       

      
        	
                FOR
      THE MA ORGANIZATION

              	 
	
                Todd
      Farha

              	
                President &
      CEO

              
	
                Printed
      Name

                 

              	
                Title

              
	
                  /s/  Todd
      Farha

              	
                9/4/07

              
	
                Signature

              	
                Date

                 

              
	
                Harmony Health Plans
      of Illinois, Inc.

              	
                8735 Henderson Rd,
      Tampa, FL 33634

              
	
                Organization

              	
                Address

              
	 	 
	
                FOR
      THE CENTERS FOR MEDICARE & MEDICAID SERVICES

              
	
                /s/ David A.
      Lewis

              	
                10/29/07

              
	
                David
      A. Lewis

              	
                Date

              
	
                Director

              	 
	
                Medicare
      Advantage Group

              	 
	
                Center
      for Beneficiary Choices

              	 
	 	 

      

      
         

        

      

      
        

      

      
        

        19

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        ATTACHMENT
A

      

      
        

        ATTESTATION OF ENROLLMENT
INFORMATION

      

      
        RELATING TO CMS PAYMENT TO A MEDICARE
ADVANTAGE ORGANIZATION

      

      
        

        Pursuant
to the contract(s) between the Centers for Medicare & Medicaid Services
(CMS) and (INSERT NAME
OF MA ORGANIZATION), hereafter referred to as the MA Organization,
governing the operation of the following Medicare Advantage plans (INSERT PLAN IDENTIFICATION NUMBERS
HERE). the MA Organization hereby requests payment under the contract,
and in doing so, makes the following attestation concerning CMS payments to the
MA Organization. The MA Organization acknowledges that the information described
below directly affects the calculation of CMS payments to the MA Organization
and that misrepresentations to CMS about the accuracy of such information may
result in Federal civil action and/or criminal prosecution. This attestation
shall not be considered a waiver of the MA Organization's right to seek payment
adjustments from CMS based on information or data which does not become
available until after the date the MA Organization submits this
attestation.

      

      
        

        1.            The
MA Organization has reported to CMS for the month of (INDICATE MONTH AND
YEAR) all new enrollments, disenrollments, and changes in enrollees'
institutional status with respect to the above-stated MA plans. Based on best
knowledge, information, and belief as of the date indicated below, all
information submitted to CMS in this report is accurate, complete, and
truthful.

      

      
        

        2.            The
MA Organization has reviewed the CMS monthly membership report and reply listing
for the month of (INDICATE MONTH AND
YEAR) for the above-stated MA plans and has reported to CMS any
discrepancies between the report and the MA Organization's records. For those
portions of the monthly membership report and the reply listing to which the MA
Organization raises no objection, the MA Organization, through the certifying
CEO/CFO, will be deemed to have attested, based on best knowledge, information,
and belief as of the date indicated below, to their accuracy, completeness, and
truthfulness.

      

      
        

        (INDICATE
TITLE [CEO, CFO, or delegate]) on behalf of

      

      
        

        (INDICATE
MA ORGANIZATION)

      

      
        

        DATE

      

      
        

        20

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        ATTACHMENT
B

      

      
        

        
          	
                   

                	
                  ATTESTATION OF RISK ADJUSTMENT
      DATA INFORMATION RELATING TO CMS PAYMENT TO A MEDICARE ADVANTAGE
      ORGANIZATION

                

        

      

      
        

        Pursuant
to the contract(s) between the Centers for Medicare & Medicaid Services
(CMS) and (INSERT NAME
OF MA ORGANIZATION), hereafter referred to as the MA Organization,
governing the operation of the following Medicare Advantage plans (INSERT PLAN IDENTIFICATION NUMBERS
HERE), the
MA Organization hereby requests payment under the contract, and in doing so,
makes the following attestation concerning CMS payments to the MA Organization.
The MA Organization acknowledges that the information described below directly
affects the calculation of CMS payments to the MA Organization or additional
benefit obligations of the MA Organization and that misrepresentations to CMS
about the accuracy of such information may result in Federal civil action and/or
criminal prosecution.

      

      
        

        The MA
Organization has reported to CMS during the period of (INDICATE DATES) all
(INDICATE TYPE OF DATA
-INPATIENT HOSPITAL.
OUTPATIENT HOSPITAL. OR PHYSICIAN) risk adjustment data
available to the MA Organization with respect to the above-stated MA plans.
Based on best knowledge, information, and belief as of the date indicated below,
all information submitted to CMS in this report is accurate, complete, and
truthful.

      

      
        

        (INDICATE
TITLE [CEO, CFO, or delegate]) on behalf of

      

      
        

        (INDICATE
MA ORGANIZATION)

      

      
        

        DATE

      

      
        

        21

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        ADDENDUM TO MEDICARE MANAGED CARE
CONTRACT PURSUANT TO

      

      
        SECTIONS 1860D-1 THROUGH 1860D-42 OF
THE SOCIAL SECURITY ACT

      

      
        FOR THE OPERATION OF A VOLUNTARY
MEDICARE PRESCRIPTION

      

      
        DRUG PLAN

      

      
        

        The
Centers for Medicare & Medicaid Services (hereinafter referred to as "CMS")
and Harmony Health Plans of
Illinois, Inc.,
a Medicare managed care-organization (hereinafter referred to as the
MA-PD Sponsor) agree to amend the contract (H1657 ) governing the MA-PD
Sponsor's operation of a Part C plan described in Section 1851(a)(2)(A) of the
Social Security Act (hereinafter referred to as "the Act") or a Medicare cost
plan to include this addendum under which the MA-PD Sponsor shall operate a
Voluntary Medicare Prescription Drug Plan pursuant to sections 1860D-1 through
1860D-42 (with the exception of section 1860D-22 and 1860D-31) of the
Act.

      

      
        

        This
addendum is made pursuant to Subpart L of 42 CFR Part 417 (in the case of cost
plan sponsors offering a Part D benefit) and Subpart K of 42 CFR Part 422 (in
the case of an MA-PD Sponsor offering a Part C plan).

      

      
        

        NOTE: For
purposes of this addendum, unless otherwise noted, reference to an "MA-PD
Sponsor" or "MA-PD Plan" is deemed to include a cost plan sponsor or a MA
private fee-for-service contractor offering a Part D benefit.

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article I

      

      
        Medicare Voluntary Prescription Drug
Benefit

      

      
        

        
          	
                  A.

                	
                  The
      MA-PD Sponsor agrees to operate one or more Medicare Voluntary
      Prescription Drug Plans as described in its application and related
      materials, including but not limited to all the attestations
      contained therein and all supplemental guidance, for Medicare
      approval and in compliance with the provisions of this addendum,
      which incorporates in its entirety the Solicitation For
      Applications for New Medicare Advantage Prescription
      Drug Plan (MA-PD) Sponsors, released on January 16,
      2007 [applicable to Medicare Part C contractors] or the Solicitation for
      Applications for New Cost Plan Sponsors, released on January 16,
      2007 [applicable to Medicare cost plan contractors]
      (hereinafter collectively referred to as "the addendum"). The MA- PD
      Sponsor also agrees to operate in accordance with the regulations at 42
      CFR §423.1 through 42 CFR §423.910 (with the exception of Subparts Q,
      R, and S), sections 1860D-1 through 1860D-42 (with the exception of
      sections 1860D-22(a) and 1860D-31) of the Social Security Act, and
      the applicable solicitation identified above, as well as all other
      applicable Federal statutes, regulations, and policies. This addendum
      is deemed to incorporate any changes that are required by statute to
      be implemented during the term of this addendum and any regulations
      or policies implementing or interpreting such statutory
      provisions.

                

        

      

      
        

        
          	
                  B.

                	
                  CMS
      agrees to perform its obligations to the MA-PD Sponsor consistent with
      the regulations at 42 CFR §423.1 through 42 CFR §423.910 (with the
      exception of Subparts Q, R, and S), sections 1860D-1 through 1860D-42
      (with the exception of sections 1860D-22(a) and 1860D-31) of the
      Social Security Act, and the applicable solicitation, as well as all
      other applicable Federal statutes, regulations, and
    policies.

                

        

      

      
        

        
          	
                  C.

                	
                  CMS
      agrees that it will not implement, other than at the beginning of a
      calendar year, regulations under 42 CFR Part 423 that impose new,
      significant regulatory requirements on the MA-PD Sponsor. This
      provision does not apply to new requirements mandated by
      statute.

                

        

      

      
        

        
          	
                  D.

                	
                  This
      addendum is in no way intended to supersede or modify 42 CFR, Parts
      417,422 or 423. Failure to reference a regulatory requirement in this
      addendum does not affect the applicability of such requirements to
      the MA-PD Sponsor and CMS.

                

        

      

      
        

      

      
        Article II

      

      
        

      

      
        Functions to be Performed by the
MA-PD Sponsor

      

      
        

        A.
ENROLLMENT

      

      
        

        1.  MA-PD
Sponsor agrees to enroll in its MA-PD plan only Part D-eligible beneficiaries
as they are defined in 42 CFR §423.30(a) and who have elected to enroll in MA-PD
Sponsor's Part C or Section 1876 benefit.

      

      
        

        2

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        
          	
                  2.

                	
                  If
      the MA-PD Sponsor is a cost plan sponsor, the MA-PD Sponsor acknowledges
      that its Section 1876 plan enrollees are not required to elect enrollment
      in its Part D plan.

                

        

      

      
        

        B.
PRESCRIPTION DRUG BENEFIT

      

      
        

        
          	
                  1.

                	
                  MA-PD
      Sponsor agrees to provide the required prescription drug coverage as
      defined under 42 CFR §423.100 and, to the extent applicable, supplemental
      benefits as defined in 42 CFR §423.100 and in accordance with Subpart C of
      42 CFR Part 423. MA-PD Sponsor also agrees to provide Part D benefits as
      described in the MA-PD Sponsor's Part D bid(s) approved each year by CMS
      (and in the Attestation of Benefit Plan and Price, attached
      hereto).

                

        

      

      
        
          	
                  2.

                	
                  MA-PD
      Sponsor agrees to calculate and collect beneficiary Part D premiums in
      accordance with 42 CFR §§423.286 and
423.293.

                

        

      

      
        
          	
                  3.

                	
                  If
      the MA-PD Sponsors is a cost plans sponsor, it acknowledge that its Part D
      benefit is offered as an optional supplemental service in accordance with
      42 CFR §417.440(b)(2)(ii).

                

        

      

      
        

        C.           DISSEMINATION
OF PLAN INFORMATION

      

      
        

        1.      MA-PD
Sponsor agrees to provide the information required in 42 CFR
§423.48.

      

      
        

        
          	
                  2.

                	
                  MA-PD
      Sponsor agrees to disclose information related to Part D benefits to
      beneficiaries in the manner and the form specified by CMS under 42 CFR
      §§423.128 and 423.50 and in the "Marketing Materials Guidelines for
      Medicare Advantage-Prescription Drug Plans (MA-PDs) and Prescription Drug
      Plans (PDPs)."

                

        

      

      
        

        
          	
                  3.

                	
                  MA-PD
      Sponsor certifies that all materials it submits to CMS under the File and
      Use Certification authority described in the Marketing Materials
      Guidelines are accurate, truthful, not misleading, and consistent with CMS
      marketing guidelines.

                

        

      

      
        

        D.           QUALITY
ASSURANCE/UTILIZATION MANAGEMENT

      

      
        

        MA-PD
Sponsor agrees to operate quality assurance, cost, and utilization management,
medication therapy management programs, and support electronic prescribing in
accordance with Subpart D of 42 CFR Part 423.

      

      
        

        E.           APPEALS
AND GRIEVANCES

      

      
        

        MA-PD
Sponsor agrees to comply with all requirements in Subpart M of 42 CFR Part 423
governing coverage determinations, grievances and appeals, and
formulary exceptions. MA-PD Sponsor acknowledges that these requirements
are separate and distinct from the appeals and grievances requirements
applicable to the MA-PD Sponsor through the operation of its Part C or cost plan
benefits.

      

      
        

        3

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        F.           PAYMENT
TO MA-PD SPONSOR

      

      
        

        
          	
                  1.

                	
                  MA-PD
      Sponsor and CMS agree that payment paid for Part D services under the
      addendum will be governed by the rules in Subpart G of 42 CFR Part
      423.

                

        

      

      
        

        
          	
                  2.

                	
                  If
      the MA-PD Sponsor is participating in the Part D Reinsurance Payment
      Demonstration, described in 70 FR 9360 (Feb. 25,2005), it affirms that it
      will not seek payment under the demonstration for services provided to
      employer group enrollees.

                

        

      

      
        

        G.           BID
SUBMISSION AND REVIEW

      

      
        

        If the
MA-PD Sponsor intends to participate in the Part D program for the future year,
MA-PD Sponsor agrees to submit a future year's Part D bid, including all
required information on premiums, benefits, and cost-sharing, by the applicable
due date, as provided in Subpart F of 42 CFR Part 423 so that CMS and the MA-PD
Sponsor may conduct negotiations regarding the terms and conditions of the
proposed bid and benefit plan renewal. MA-PD Sponsor acknowledges that failure
to submit a timely bid under this section may affect the sponsor's ability to
offer a Part C plan, pursuant to the provisions of 42 CFR
§422.4(c).

      

      
        

        H.   COORDINATION WITH OTHER
PRESCRIPTION DRUG COVERAGE

      

      
        

        
          	
                  1.

                	
                  MA-PD
      Sponsor agrees to comply with the coordination requirements with State
      Pharmacy Assistance Programs (SPAPs) and plans that provide other
      prescription drug coverage as described in Subpart J of 42 CFR Part
      423.

                

        

      

      
        

        
          	
                  2.

                	
                  MA-PD
      Sponsor agrees to comply with Medicare Secondary Payer procedures as
      stated in 42 CFR §423.462.

                

        

      

      
        

        I.     SERVICE AREA
AND PHARMACY ACCESS

      

      
        

        
          	
                  1.

                	
                  The
      MA-PD Sponsor agrees to provide Part D benefits in the service area for
      which it has been approved by CMS to offer Part C or cost plan benefits
      utilizing a pharmacy network and formulary approved by CMS that meet the
      requirements of 42 CFR
§423.120.

                

        

      

      
        

        
          	
                  2.

                	
                  The
      MA-PD Sponsor agrees to ensure adequate access to Part D-covered drugs at
      out-of-network pharmacies according to 42 CFR
  §423.124.

                

        

      

      
        

        
          	
                  3.

                	
                  MA-PD
      Sponsor agrees to provide benefits by means of point-of-service systems to
      adjudicate prescription drug claims in a timely and efficient manner in
      compliance with CMS standards, except when necessary to provide access in
      underserved areas, I/T/U pharmacies (as defined in 42 CFR §423.100), and
      long-term care pharmacies (as defined in 42 CFR
  §423.100).

                

        

      

      
        

        4

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        
          	
                  4.

                	
                  MA-PD
      Sponsor agrees to contract with any pharmacy that meets the MA-PD
      Sponsor's reasonable and relevant standard terms and conditions. If MA-PD
      Sponsor has demonstrated that it historically fills 98% or more of its
      enrollees' prescriptions at pharmacies owned and operated by the MA-PD
      Sponsor (or presents compelling circumstances that prevent the sponsor
      from meeting the 98% standard or demonstrates that its Part D plan design
      will enable the sponsor to meet the 98% standard during the contract
      year), this provision does not apply to MA-PD Sponsor's
    plan.

                

        

      

      
        

        
          	
                  5.

                	
                  The
      provisions of 42 CFR §423.120(a) concerning the TRICARE retail pharmacy
      access standard do not apply to MA-PD Sponsor if the Sponsor has
      demonstrated to CMS that it historically fills more than 50% of its
      enrollees' prescriptions at pharmacies owned and operated by the MA-PD
      Sponsor. MA-PD Sponsors excused from meeting the TRICARE standard are
      required to demonstrate retail pharmacy access that meets the requirements
      of 42 CFR §422.112 for a Part C contractor and 42 CFR §417.416(e) for a
      cost plan contractor.

                

        

      

      
        

        J.  COMPLIANCE PLAN/PROGRAM
INTEGRITY

      

      
        

        MA-PD
Sponsor agrees that it will develop and implement a compliance plan that applies
to its Part D-related operations, .consistent with 42 CFR
§423.504(b)(4)(vi).

      

      
        

        K.   LOW-INCOME
SUBSIDY

      

      
        

        MA-PD
Sponsor agrees that it will participate in the administration of subsidies for
low-income individuals according to Subpart P of 42 CFR Part
423.

      

      
        

        L.   BENEFICIARY FINANCIAL
PROTECTIONS

      

      
        

        The MA-PD
Sponsor agrees to afford its enrollees protection from liability for payment of
fees that are the obligation of the MA-PD Sponsor in accordance with 42 CFR
§423.505(g).

      

      
         

        
          M.   RELATIONSHIP WITH RELATED
ENTITIES, CONTRACTORS, AND SUBCONTRACTORS 

        

      

      
        

        
          	
                  1.

                	
                  The
      MA-PD Sponsor agrees that it maintains ultimate responsibility for
      adhering to and otherwise fully complying with all terms and conditions of
      this addendum.

                

        

      

      
        

        
          	
                  2.

                	
                  The
      MA-PD Sponsor shall ensure that any contracts or agreements with
      subcontractors or agents performing functions on the MA-PD Sponsor's
      behalf related to the operation of the Part D benefit are in compliance
      with 42 CFR §423.505(i).

                

        

      

      
        

        5

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        N.     CERTIFICATION
OF DATA THAT DETERMINE PAYMENT

      

      
        

        MA-PD
Sponsor must provide certifications in accordance with 42 CFR
§423.505(k).

      

      
        

      

      
        

      

      
        Article III

      

      
         Record Retention and Reporting
Requirements

      

      
        

        A.           MAINTENANCE
OF RECORDS

      

      
        

        MA-PD
Sponsor agrees to maintain records and provide access in accordance with 42 CFR
§§423.504(d) and 505(d) and (e).

      

      
        

        B.           GENERAL
REPORTING REQUIREMENTS

      

      
        

        The MA-PD
Sponsor agrees to submit to information to CMS according to 42 CFR §§423.505(f),
423.514, and the "Final Medicare Part D Reporting Requirements," a document
issued by CMS and subject to modification each program year.

      

      
        

        C.           CMS
LICENSE FOR USE OF PLAN FORMULARY

      

      
        

        PDP
Sponsor agrees to submit to CMS each plan's formulary information, including any
changes to its formularies, and hereby grants to the Government[, and any person
or entity who might receive the formulary from the Government,] a non-exclusive
license to use all or any portion of the formulary for any purpose related to
the administration of the Part D program, including without limitation publicly
distributing, displaying, publishing or reconfiguration of the information in
any medium, including www.medicare.gov, and
by any electronic, print or other means of distribution.

      

      
        

        Article IV HIPAA
Transactions/Privacy/Security

      

      
        

        
          	
                  A.

                	
                  MA-PD
      Sponsor agrees to comply with the confidentiality and enrollee
      record accuracy requirements specified in 42 CFR
      §423.136.

                

        

      

      
        

        
          	
                  B.

                	
                  MA-PD
      Sponsor agrees to enter into a business associate agreement with the
      entity with which CMS has contracted to track Medicare beneficiaries'
      true
out-of-pocket costs.

                

        

      

      
        

        6

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article V

      

      
        Addendum Term and
Renewal

      

      
        

        A.           TERM
OF ADDENDUM

      

      
        

        This
addendum is effective from the date of CMS' authorized representative's
signature through December 31, 2008. This addendum shall be renewable for
successive one-year periods thereafter according to 42 CFR §423.506. MA-PD
Sponsor shall not conduct Part D-related marketing activities prior to October
1, 2007 and shall not process enrollment applications prior to November 15,
2007. MA-PD Sponsor shall begin delivering Part D benefit services on January 1,
2008.

      

      
        

        B.           QUALIFICATION
TO RENEW ADDENDUM

      

      
        

        
          	
                  1.

                	
                  In
      accordance with 42 CFR §423.507, the MA-PD Sponsor will be
      determined qualified to renew this addendum annually only
      if—

                

        

      

      
        
          	
                  (a)

                	
                  CMS
      informs the MA-PD Sponsor that it is qualified to renew its addendum;
      and

                

        

      

      
        
          	
                  (b)

                	
                  The
      MA-PD Sponsor has not provided CMS with a notice of intention not to renew
      in accordance with Article VII of this
addendum.

                

        

      

      
        

        2.                Although
MA-PD Sponsor may be determined qualified to renew its addendum under
this Article, if the MA-PD Sponsor and CMS cannot reach agreement on the Part D
bid under Subpart F of 42 CFR Part 423, no renewal takes place, and the failure
to reach agreement is not subject to the appeals provisions in Subpart N of 42
CFR Parts 422 or 423. (Refer to Article XI for consequences of non­renewal
on the Part C contract and the ability to enter into a Part C
contract.)

      

      
        

      

      
        Article
VI

      

      
        Nonrenewal of
Addendum

      

      
        

        A.           NONRENEWAL
BY THE MA-PD SPONSOR

      

      
        

        
          	
                  1.

                	
                  MA-PD
      Sponsor may non-renew this addendum in accordance with 42 CFR
      423.507(a).

                

        

      

      
        
          	
                  2.

                	
                  If
      the MA-PD Sponsor non-renews this addendum under this Article, CMS cannot
      enter into a Part D addendum with the organization for 2 years unless
      there are special circumstances that warrant special consideration, as
      determined by CMS.

                

        

      

      
        

        B.           NONRENEWAL
BY CMS

      

      
        

        CMS may
non-renew this addendum under the rules of 42 CFR 423.507(b). (Refer to Article
X for consequences of non-renewal on the Part C contract and the ability to
enter into a Part C contract.)

      

      
        

        7

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        Article VII

      

      
        
          	
                   

                	
                  Modification or Termination of
      Addendum by Mutual
Consent

                

        

      

      
        

        This
addendum may be modified or terminated at any time by written mutual consent in
accordance with 42 CFR 423.508. (Refer to Article X for consequences of
non-renewal on the Part C contract and the ability to enter into a Part C
contract.)

      

      
        

      

      
        

      

      
        Article
VIII

      

      
         Termination of Addendum by
CMS

      

      
        

        CMS may
terminate this addendum in accordance with 42 CFR 423.509. (Refer to Article X
for consequences of non-renewal on the Part C contract and the ability to enter
into a Part C contract.)

      

      
        

      

      
        Article IX

      

      
        Termination of Addendum by the MA-PD
Sponsor

      

      
        

        
          	
                  A.

                	
                  The
      MA-PD Sponsor may terminate this addendum only in accordance with 42
      CFR 423.510.

                

        

      

      
        

        
          	
                  B.

                	
                  CMS
      will not enter into a Part D addendum with an organization that has
      terminated its addendum within the preceding 2 years unless there are
      circumstances that warrant special consideration, as determined by
      CMS.

                

        

      

      
        

        
          	
                  C.

                	
                  If
      the addendum is terminated under section A of this Article, the MA-PD
      Sponsor must ensure the timely transfer of any data or files. (Refer
      to Article X for consequences of non-renewal on the Part C contract
      and the ability to enter into a Part C
  contract.)

                

        

      

      
        

      

      
        Article X

      

      
        Relationship Between Addendum and
Part C Contract or 1876 Cost Contract

      

      
        

        
          	
                   

                	
                  A.
      MA-PD Sponsor acknowledges that, if it is a Medicare Part C contractor,
      the termination or nonrenewal of this addendum by either party may require
      CMS to terminate or non-renew the Sponsor's Part C contract in the event
      that such non­renewal or termination prevents the MA-PD Sponsor from
      meeting the requirements of 42 CFR §422.4(c), in which case the Sponsor
      must provide the notices specified in this contract, as well as the
      notices specified under Subpart K of 42 CFR Part 422. MA-PD Sponsor also
      acknowledges that Article X.B. of this addendum may prevent the sponsor
      from entering into a Part C contract for two years following an addendum
      termination or non-renewal where such non-renewal or termination prevents
      the MA-PD Sponsor from meeting the requirements of 42 CFR
      §422.4(c).

                

        

      

      
        

        8

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        
          	
                  B.

                	
                  The
      termination of this addendum by either party shall not, by itself, relieve
      the parties from their obligations under the Part C or cost plan
      contracts to which this document is an
  addendum.

                

        

      

      
        

        
          	
                  C.

                	
                  In
      the event that the MA-PD Sponsor's Part C or cost plan contract (as
      applicable) is terminated or nonrenewed by either party, the
      provisions of this addendum shall also terminate. In such an event,
      the MA-PD Sponsor and CMS shall provide notice to enrollees and the
      public as described in this contract as well as 42 CFR Part
      422, Subpart K or 42 CFR Part 417, Subpart K, as
      applicable.

                

        

      

      
        

        Article XI 

        Intermediate
Sanctions

      

      
        

        The MA-PD
Sponsor shall be subject to sanctions and civil monetary penalties, consistent
with Subpart O of
42 CFR Part 423.

      

      
        

        Article XII 

        Severability

      

      
        

        Severability
of the addendum shall be in accordance with 42 CFR
§423.504(e).

      

      
        

        Article XII

        Miscellaneous

      

      
        

        
          	
                  A.

                	
                  DEFINITIONS:
      Terms not otherwise defined in this addendum shall have the meaning
      given such terms at 42 CFR Part 423 or, as applicable, 42 CFR Part 422
      or Part 417.

                

        

      

      
        

        
          	
                  B.

                	
                  ALTERATION
      TO ORIGINAL ADDENDUM TERMS: The MA-PD Sponsor agrees that it has not
      altered in any way the terms of the MA-PD addendum presented for
      signature by CMS. MA-PD Sponsor agrees that any alterations to the
      original text the MA-PD Sponsor may make to this addendum shall not
      be binding on the parties.

                

        

      

      
        

        
          	
                  C.

                	
                  ADDITIONAL
      CONTRACT TERMS: The MA-PD Sponsor agree to include in this addendum
      other terms and conditions in accordance with 42 CFR
      §423.505(j).

                

        

      

      
        

        
          	
                  D.

                	
                  CMS
      APPROVAL TO BEGIN MARKETING AND ENROLLMENT ACTIVITIES: The MA-PD
      Sponsor agrees that it must complete CMS operational
      requirements related to its Part D benefit prior to receiving CMS
      approval to begin MA-PD plan- marketing activities relating to its
      Part D benefit. Such activities include, but are not limited to,
      establishing and successfully testing connectivity with CMS systems
      to process enrollment applications (or contracting with an entity
      qualified to perform

                

        

      

      
        

        9

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        such
functions on MA-PD Sponsor's behalf) and successfully demonstrating the
capability to submit accurate and timely price comparison data. To establish and
successfully test connectivity, the PDP Sponsor must, 1) establish and test
physical connectivity to-the CMS data center, 2) acquire user identifications
and passwords, 3) receive, store, and maintain data necessary to perform
enrollments and send and receive transactions to and from CMS, and 4) check and
receive transaction status information.

      

      
        

        10

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        In
witness whereof, the parties hereby execute this contract
modification.

         

      

      
        	
                
                  FOR
      THE MA-PD SPONSOR

                

                 

              	 
	
                Todd
      Farha

              	
                President &
      CEO

              
	
                Printed
      Name

                 

              	
                Title

              
	
                  /s/  Todd
      Farha

              	
                9/4/07

              
	
                Signature

              	
                Date

                 

              
	
                Harmony Health Plans
      of Illinois, Inc.

              	
                8735 Henderson Rd,
      Tampa, FL 33634

              
	
                Organization

              	
                Address

              
	 	 
	
                FOR
      THE CENTERS FOR MEDICARE & MEDICAID SERVICES

              
	
                /s/ David A.
      Lewis

              	
                10/29/07

              
	
                David
      A. Lewis

              	
                Date

              
	
                Director

              	 
	
                Medicare
      Advantage Group

              	 
	
                Center
      for Beneficiary Choices

              	 
	 	 

      

      
        

        11

      

      

      
        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

      

      
        PART C/D BENEFIT PLAN(S) DESCRIPTION
TO BE ATTACHED TO MA CONTRACT

      

      
        

        SECTION 1876/PART D OPTIONAL
SUPPLEMENTAL BENEFIT PLAN DESCRIPTION TO BE ATTACHED TO SECTION 1876
CONTRACT

         

         

        12EX-10.1

WAUWATOSA SAVINGS BANK

EXECUTIVE DEFERRED

COMPENSATION PLAN

Amended and Restated Effective as of September 1, 2006

	 	 	 	 	 	 	 	 	 
	ARTICLE I ESTABLI
	 	SHMENT OF PLAN AND PURPOSE                    1
	 	 	 	 
	ARTICLE II
	 	DEFINITIONS
	 		1	
	ARTICLE III
	 	ELIGIBILITY
	 		3	
	ARTICLE IV
	 	COMPENSATION DEFERRAL AND DISTRIBUTION ELECTIONS
	 		3	
	ARTICLE V
	 	PARTICIPANT ACCOUNTS
	 		4	
	ARTICLE VI
	 	VESTING
	 		5	
	ARTICLE VII
	 	DISTRIBUTIONS
	 		6	
	ARTICLE VIII
	 	ADMINISTRATION OF THE PLAN
	 		7	
	ARTICLE IX
	 	CLAIMS PROCEDURES
	 		8	
	ARTICLE X
	 	AMENDMENT OR TERMINATION OF PLAN
	 		8	
	ARTICLE XI
	 	PLAN FUNDING
	 		9	
	ARTICLE XII
	 	GENERAL PROVISIONS
	 		9	

1

WAUWATOSA SAVINGS BANK

AMENDED AND RESTATED

EXECUTIVE DEFERRED COMPENSATION PLAN

ARTICLE I

Establishment of Plan and Purpose

1.01 Establishment of Plan. Wauwatosa Savings Bank (the “Company”) hereby established
the Wauwatosa Savings Bank Executive Deferred Compensation Plan (the “Plan”), effective as of
September 1, 2006.

1.02 Purpose of Plan. Under the Plan, selected senior management and highly
compensated employees are permitted to defer, until a future designated date, a portion of the
compensation which may otherwise be payable to them at an earlier date. By allowing key management
employees to participate in the Plan, the Company expects the Plan to benefit it and its
Subsidiaries by attracting and retaining the most capable individuals to fill its executive
positions. Furthermore, the Plan is a deferred compensation arrangement intended to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”). Final Treasury
Regulations under Code Section 409A were issued in April 2007, and require non-qualified deferred
compensation plans to be in compliance with said Final Treasury Regulations by no later than
December 31, 2008. Accordingly, the Plan has been amended and restated, effective September 1,
2006, to comply with Final Treasury Regulations issued under Code Section 409A.

ARTICLE II

Definitions

	 	 	 
	As used herein, the following words shall have the following meanings:

	2.01

	 	Definitions.
	
 
	 	 

(a) Account. The bookkeeping account maintained for each Participant pursuant to
Article V below.

(b) Administrator. The person or persons selected pursuant to Article VIII below to
control and manage the operation and administration of the Plan.

(c) Beneficiaries. Those persons or entities designated by a Participant on the
Beneficiary Designation Election Form (Exhibit A hereto) to receive his benefits under the Plan
upon his death.

(d) Change of Control. (i) Any “person” (as such term is used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other than
Lamplighter Financial, MHC (“MHC”) becomes the beneficial owner, directly or indirectly, of a
majority of the capital stock of Wauwatosa Holdings, Inc. in a transaction or transactions subject
to either the notice provisions of the Change in Bank Control Act of 1978 (12 U.S.C. § 1817 (j), as
amended from time to time), or approval under the Bank Holding Company Act of 1956 (12 U.S.C. §
1841, as amended from time to time); (ii) during any period of two consecutive years, the
individuals, who at the beginning of any such period constituted the directors of Wauwatosa
Holdings, Inc., cease for any reason to constitute at least a majority thereof; (iii) Wauwatosa
Holdings, Inc. files a report or proxy statement with the Securities and Exchange Commission and/or
the Federal Reserve Board disclosing in response to Item 5.01 of Form 8-K or Item 5 of Part II of
Form 10-Q, each promulgated pursuant to the Exchange Act or Item 6(e) of Schedule 14A promulgated
thereunder, or successor Items, that a change in control of Wauwatosa Holdings, Inc. has or may
have occurred pursuant to any contract or transaction; or (iv) any person other than Wauwatosa
Holdings, Inc. or MHC becomes the owner of more than 25% of the voting securities of the Company.
However, notwithstanding the foregoing provisions, a reorganization of Wauwatosa Holdings, Inc. and
MHC in which the shareholders of Wauwatosa Holdings, Inc. prior to such reorganization, the members
of MHC and any members of the public, which acquire shares of such entity pursuant to a public
offering of securities approved in advance by the board of directors of MHC, together control the
successor entity shall not constitute a “Change in Control” hereunder.

(e) Company. Wauwatosa Savings Bank, a Wisconsin-chartered savings bank, or a
successor thereof.

(f) Compensation. The total of the Participant’s base salary, commissions, bonuses
and other cash incentive pay, which shall include amounts deferred by the Participant under this
Plan or any other employee benefit plan of the Company. In all cases, Compensation shall include
only compensation paid while a Participant in the Plan and employed by the Company or a Subsidiary.
Compensation shall not include any severance or salary continuation payments.

(g) Participants. Such senior management and highly compensated employees of the
Company or a Subsidiary whom the Administrator has identified as eligible to defer Compensation
hereunder and who elect to participate by deferring Compensation.

(h) Plan. The Wauwatosa Savings Bank Executive Deferred Compensation Plan, as stated
herein and as amended from time to time.

(i) Plan Year. The period beginning on September 1, 2006 and ending on December 31,
2006, and, thereafter, each 12-month period ending on each subsequent December 31.

(j) Separation from Service. Separation from Service means the Participant’s
retirement or other termination of employment with the Company within the meaning of Code Section
409A. No Separation from Service shall be deemed to occur due to military leave, sick leave or
other bona fide leave of absence if the period of such leave does not exceed six months or, if
longer, so long as the Participant’s right to reemployment is provided by law or contract. If the
leave exceeds six months and the Participant’s right to reemployment is not provided by law or by
contract, then the Participant shall have a Separation from Service on the first date immediately
following such six-month period.

Whether a Separation from Service has occurred is determined based on whether the facts and
circumstances indicate that the Company and the Participant reasonably anticipated that no further
services would be performed after a certain date or that the level of bona fide services the
Participant would perform after such date (whether as an employee or as an independent contractor)
would permanently decrease to no more than 49% of the average level of bona fide services performed
over the immediately preceding 36 months (or such lesser period of time in which the Participant
performed services for the Company). The determination of whether a Participant has had a
Separation from Service shall be made by applying the presumptions set forth in the Treasury
Regulations under Code Section 409A.

(k) Subsidiary. An entity of which the Company is the direct or indirect beneficial
owner of not less than 50% of all issued and outstanding equity interest of such entity.

(l) Unforeseeable Emergency. A severe financial hardship of a Participant resulting
from an illness or accident of the Participant or of the Participant’s spouse or dependent (as
defined in Code Section 152(a)), loss of the Participant’s property due to casualty, or other
similar extraordinary and unforeseeable circumstances beyond the control of the Participant. The
existence of an Unforeseeable Emergency shall be determined by the Administrator in its sole
discretion.

ARTICLE III

Eligibility

3.01 Conditions of Eligibility. The Administrator shall, from time to time, specify
the senior management and highly compensated employees of the Company or a Subsidiary eligible to
participate herein. Eligibility to participate in the Plan for one Plan Year does not guarantee
eligibility for a subsequent Plan Year.

3.02 Commencement of Participation. An individual identified as eligible to
participate in the Plan for that Plan Year shall, by electing a deferral of Compensation on the
Deferral Election Form with Distribution Options (Exhibit B hereto) provided by the Administrator,
commence participation as of (a) the first day of such Plan Year or (b) such later date in that
Plan Year as he first becomes eligible to participate in the Plan.

3.03 Termination of Participation. A Participant’s right to defer Compensation
hereunder shall cease as of the earlier of the (a) termination of his employment with the Company
and all Subsidiaries or (b) failure of the Administrator to designate him as eligible to
participate herein.

ARTICLE IV

Compensation Deferral and Distribution Elections

4.01 Amount and Manner of Deferral.

(a) Each Participant must make an annual election with respect to his Compensation deferrals.
The Participant must return the Deferral Election Form with Distribution Options to the
Administrator no later than the date specified by the Administrator, which date shall be prior to
(i) the first day of the Plan Year for which the Compensation is to be deferred, (ii) in the case
of a new Participant, the 30th day after first becoming eligible to participate in the
Plan, with respect to Compensation earned for services performed subsequent to the election, or
(iii) in the case of the first Plan Year, September 30, 2006, with respect to Compensation earned
for services performed subsequent to the election. The Deferral Election Form with Distribution
Options shall become irrevocable as of the date it is to be effective.

(b) The Participant must indicate on the Deferral Election Form with Distribution Options the
amount of his Compensation for such Plan Year, or portion thereof, which he elects to defer
hereunder. A Participant may defer (i) up to 80% of his salary or commissions and/or (ii) up to
100% of his bonus or incentive pay; provided, however, that (A) the Participant may not defer less
than $5,000 in a Plan Year (or a prorated amount for any period shorter than a full Plan Year) and
(B) the Participant’s deferral election for a Plan Year shall relate to Compensation earned by him
during such Plan Year, whether or not paid during that Plan Year.

(c) If a Participant elects to defer a portion of his salary or commissions, the Company shall
reduce the Participant’s salary or commissions by an equal amount in each pay period during the
Plan Year of deferral. If a Participant elects to defer all or a portion of his bonus or incentive
pay, the Company shall reduce each such Compensation payment by the percentage elected by the
Participant.

4.02 Cessation of Deferral. In the event of an Unforeseeable Emergency, a Participant
may request in writing that deferrals elected by the Participant hereunder cease for the then
current Plan Year. If the Administrator determines that such an Unforeseeable Emergency exists, the
Participant’s deferrals for such Plan Year shall cease for the remainder of the Plan Year. In
addition, if required in order for a Participant to receive a hardship distribution under any
tax-qualified retirement plan subject to Code Section 401(k) maintained by the Company or a
Subsidiary, the Participant’s deferrals under this Plan shall cease for the remainder of the Plan
Year.

4.03 Distribution of Account.

(a) Each Participant shall elect, at the time the Participant files his Deferral Election Form
with Distribution Options, the calendar year in which such deferrals, as well as any investment
earnings attributable to such Compensation deferrals, are to be distributed to him. All payments
shall be made in the form of a cash lump sum in accordance with Section 7.01. The year of
distribution may be any year subsequent to the year of deferral, including any year prior to or
following the Participant’s Separation from Service. Notwithstanding the foregoing, if the
Participant fails to elect a time for distribution, such amount will be distributed no later than
December 31 of the calendar year in which the Participant Separates from Service with the Company
and all Subsidiaries.

(b) A Participant may change the date as of which any portion of his Account is to be
distributed to him by filing a Change of Distribution Options Form (Exhibit C hereto) with the
Administrator, provided that (i) the election shall not take effect until at least 12 months after
the date on which the election is made and (ii) the first payment with respect to which such
election is made is deferred for at least five years from the date such payment would otherwise
have been made.

(c) Notwithstanding anything in the Plan to the contrary, a Participant who previously
designated the calendar year in which his or her Compensation deferrals shall be distributed may
elect to change the calendar year in which the Participant receives his or her Compensation
deferrals by filing with the Company a Transition Year Election Form (Exhibit D hereto), provided
that such election is made by December 31, 2008. For elections after December 31, 2008, please
refer to Section 4.03(b).

ARTICLE V

Participant Accounts

5.01 Establishment of Account. The Company shall credit the amounts deferred by a
Participant under Section 4.01 to the Participant’s Account.

5.02 Investment Elections.

(a) A Participant may file an Investment Election Form (Exhibit E hereto) with the
Administrator setting forth the investment alternatives used to value his Account. The initial
investment options available to each Participant are (i) the Moody’s A Long-Term Corporate Bond
Rate, adjusted as of the first day of each Plan Year to equal the average yield for the month of
September of the previous Plan Year and (ii) the total return of the Standard & Poor’s 500 Index
for the applicable calendar quarter.

(b) All investment elections must be in increments of 10%. If a Participant does not file an
Investment Election Form, the Account shall be deemed to be invested in the Moody’s A Long-Term
Corporate Bond Rate option, or such similar option as designated by the Administrator.

(c) The Participant may change his investment options as of each January 1 or July 1 by
delivering to the Administrator a new Investment Election Form at least 15 days prior to such
effective date.

(d) The Company can change, add or eliminate investment options in its sole discretion upon
advance notice to each Participant, in which case the Participant shall be given an opportunity to
reallocate his investments among the available alternatives; provided, however, that upon a Change
of Control, the Company may not change the investment choices available to Participants hereunder
without the consent of a majority of the Participants.

(e) A Participant’s Account shall reflect only the performance of such investment options and
the Participant shall have no property right or security interest in the actual investment
performance of any assets that may be invested by the Company to provide for the payment of
benefits under this Plan.

5.03 Maintenance of Account.

(a) At the end of each calendar quarter, the Administrator shall (i) increase the Account of
each Participant by (A) the amount, if any, of his Compensation deferred during any calendar
quarter, (B) any income or gains resulting as if the Account, computed in accordance with
subsection (b) below, were invested pursuant to the timely-filed Investment Election Form in effect
for such quarter and (ii) decrease the Account by (A) any withdrawals from the Account during the
calendar quarter and (B) any losses resulting as if the Account, computed in accordance with
subsection (b) below, were invested pursuant to the timely-filed investment election in effect for
such calendar quarter.

(b) For purposes of computing the investment return on the Account for any calendar quarter,
the principal balance as of the first day of the relevant quarter shall equal the balance as of the
end of the preceding quarter, increased by 50% of the Participant’s Compensation deferral
contributions, if any, credited to the Account during the quarter pursuant to Section 4.01 hereof,
and decreased by any distribution made to the Participant or his Beneficiaries during the quarter.

ARTICLE VI

Vesting

Subject to the rights of the Company’s creditors as described in Article XI, the Account of a
Participant, including all earnings and losses attributable thereto, shall at all times be fully
vested and nonforfeitable.

ARTICLE VII

Distributions

7.01 Distribution of Account Pursuant to Election. Each Participant’s Account, or
portion thereof, shall be distributed to him in a lump sum cash payment immediately following the
last day of the third calendar quarter of the Plan Year in which such amount is to be distributed
pursuant to the Participant’s election made in accordance with Section 4.03 of the Plan, but no
later than December 31 of that Plan Year; provided, however, that any amount that is distributable
upon the Participant’s Separation from Service that occurs in the fourth quarter of a Plan Year
shall be distributed in a lump sum cash payment immediately following the last day of such calendar
quarter, but no later than the March 15th immediately after the last day of such
calendar quarter.

7.02 Distribution of Account Due to Death.

(a) Upon the Participant’s death, any balance remaining in his Account shall be paid to his
Beneficiary or Beneficiaries in a lump sum cash payment (i) on the first day of the fourth calendar
quarter of the Plan Year in which the Participant’s death occurred; or (ii) if the Participant’s
death occurs during the fourth quarter of a Plan Year, then immediately following the last day of
such quarter, but no later than the March 15th immediately after the last day of such
calendar quarter.

(b) Each Participant may designate a Beneficiary or Beneficiaries to whom the Participant’s
Account shall be distributed in the event he dies before his entire Account is distributed to him.
Any such designation shall be made in writing on a form provided by the Company. The Participant
may make or change the Beneficiary designation under this Section 7.02 at any time prior to death.
If the Participant has not designated a Beneficiary under the Plan, or if no designated Beneficiary
is living on the date of distribution hereunder, the Account shall be paid to the duly appointed
and qualified executor or other personal representative of the Participant to be distributed in
accordance with his will or applicable intestacy law, or in the event that there shall be no such
representative duly appointed and qualified within six months after the date of death, then to such
persons who, at the date of the Participant’s death, would be entitled to share in the distribution
of his personal estate under the provisions of the applicable statute then in force governing the
descent of intestate property, in the proportions specified in such statute.

7.03 Unforeseeable Emergency. In the event of an Unforeseeable Emergency, a
Participant may request in writing, using the Hardship Distribution Form (Exhibit F hereto), that
all or any portion of his Account be paid prior to the normal time for payment of such amount. The
Administrator shall, in its reasonable judgment, determine whether the Participant could not
satisfy the emergency through reimbursement or compensation by insurance or otherwise, by
liquidation of other assets (provided such liquidation, in itself, would not create a financial
hardship) or by ceasing deferrals hereunder. Only if the Administrator determines that such an
Unforeseeable Emergency exists, the Company shall pay to the Participant an amount equal to the
lesser of (a) the amount requested or (b) the amount reasonably necessary to alleviate the
hardship, which in each case may include amounts necessary to pay federal, state or local income
taxes and penalties reasonably anticipated to result from the distribution.

7.04 Delay of Distribution. Notwithstanding the foregoing:

(a) If any Account or portion thereof is distributable in connection with the Participant’s
Separation from Service with the Company or a Subsidiary, and if at the time of such Separation
from Service the Participant is a “Key Employee” as defined in Code Section 416(i) (without
reference to paragraph 5 thereof), payment of such amounts shall not be made until the first day of
the seventh month following the Participant’s Separation from Service.

(b) If the Company reasonably anticipates that any distribution to a Participant of any
portion of his Account would result in a limitation of the Company’s deduction with respect to such
payment under Code Section 162(m), the Company shall direct the Administrator to delay the payment
of such amount until the earliest date at which the Company reasonably anticipates that its
deduction under Code Section 162(m) will not be limited because of such payment, or the calendar
year in which the Participant Separates from Service with the Company and its Subsidiaries.

ARTICLE VIII

Administration of the Plan

8.01 Appointment of Administrator. The Company shall, in writing, appoint one or more
persons to serve as the Plan Administrator. Any person, including an employee of the Company or a
Subsidiary, shall be eligible to serve as Administrator. Persons serving as Administrator may
resign by written notice to the Company and the Company may appoint or remove such persons by
written notice. An Administrator consisting of more than one person shall act by a majority of its
members at the time in office and may authorize any one or more of its members to execute any
document or documents on behalf of the Administrator, in which event the Administrator shall notify
the Company of the member or members so designated. No person serving as Administrator shall vote
or decide upon any matter relating solely to himself or solely to any of his rights or benefits
pursuant to the Plan.

8.02 Powers and Duties of Administrator. The Administrator shall administer the Plan
in accordance with its terms and shall have all powers necessary to carry out the provisions of the
Plan. The Administrator shall interpret the Plan and shall determine all questions arising in the
administration, interpretation, and application of the Plan, including, but not limited to,
questions of eligibility and the status and rights of employees, Participants and other persons.
Any such determination by the Administrator shall be conclusive and binding on all persons. The
regularly kept records of the Company shall be conclusive and binding upon all persons with respect
to a Participant’s date and length of employment, time and amount of Compensation and the manner of
payment thereof, type and length of any absence from work and all other matters contained therein
relating to Participants.

8.03 Plan Expenses. The expenses incurred by the Administrator in the proper
administration of the Plan shall be paid by the Company.

8.04 Limitation of Authority. The Administrator shall not add to, subtract from, or
modify any of the terms of the Plan, change or add to any benefits prescribed by the Plan, or waive
or fail to apply any Plan requirement for benefit eligibility.

ARTICLE IX

Claims Procedures

9.01 Procedure for Denial of Benefits. In the event that a claim for benefits under
the Plan of a Participant or Beneficiary (the “Claimant”) is denied in whole or in part by the
Administrator, the Administrator will notify the Claimant of the denial. Such notification will be
in writing within 90 days of the date the claim is received by the Administrator and will include:
(i) the specific reason for the denial; (ii) specific references to pertinent Plan provisions on
which denial is based; (iii) a description of any additional material and information necessary
for the Claimant to perfect his claim and an explanation of why the material or information is
necessary; and (iv) an explanation of the appeals process.

9.02 Appeal. The Claimant has 60 days from the date he receives notice of a claim
denial to file a written request for review of the denial with the Administrator. The
Administrator will review the claim denial and inform the Claimant in writing of its decision
within 60 days of the date the review request is received by the Administrator. This decision will
be final.

ARTICLE X

Amendment or Termination of Plan

10.01 Partial Termination. The board of directors of the Company may partially terminate the
Plan by freezing future accruals if, in its judgment, the tax, accounting, or other effects of the
continuance of the Plan, or potential payments thereunder, would not be in the best interests of
the Company.

10.02 Complete Termination. Subject to the requirements of Code Section 409A, in the event of
complete termination of the Plan, the Plan shall cease to operate and the Company shall pay out to
the Participant his or her benefit as if the Participant had terminated employment as of the
effective date of the complete termination. Such complete termination of the Plan shall occur only
under the following circumstances and conditions:

(i) The Administrator may terminate the Plan within 12 months of a corporate
dissolution taxed under Code Section 331, or with approval of a bankruptcy court pursuant
to 11 U.S.C. §503(b)(1)(A), provided that the amounts deferred under the Plan are included
in the Participant’s gross income in the latest of (i) the calendar year in which the Plan
terminates; (ii) the calendar year in which the amount is no longer subject to a
substantial risk of forfeiture; or (iii) the first calendar year in which the payment is
administratively practicable.

(ii) The board of directors of the Company may terminate the Plan within the 30 days
preceding a Change in Control (but not following a Change in Control), provided that the
Plan shall only be treated as terminated if all substantially similar arrangements
sponsored by the Company are terminated so that the Participant and all participants under
substantially similar arrangements are required to receive all amounts of compensation
deferred under the terminated arrangements within 12 months of the date of the termination
of the arrangements. For these purposes, “Change in Control” shall be defined in
accordance with the Treasury Regulations under Code Section 409A.

(iii) The board of directors of the Company may terminate the Plan provided that (i)
the termination and liquidation does not occur proximate to a downturn in the financial
health of the Company; (ii) all arrangements sponsored by the Company that would be
aggregated with this Plan under Treasury Regulations Section 1.409A-1(c) if the Participant
covered by this Plan was also covered by any of those other arrangements are also
terminated; (iii) no payments other than payments that would be payable under the terms of
the arrangement if the termination had not occurred are made within 12 months of the
termination of the arrangement; (iv) all payments are made within 24 months of the
termination of the arrangements; and (v) the Company does not adopt a new arrangement that
would be aggregated with any terminated arrangement under Treasury Regulations Section
1.409A-1(c) if the Participant participated in both arrangements, at any time within three
years following the date of termination of the arrangement.

ARTICLE XI

Plan Funding

11.01 Unfunded Plan. The Plan is intended to be an unfunded plan maintained solely
for the purpose of providing deferred compensation for a select group of management or highly
compensated employees for purposes of Title I of the Employee Retirement Income Security Act of
1974.

11.02 Unsecured Rights. The right of the Participant or his Beneficiary to receive a
distribution under the Plan will be an unsecured claim against the general assets of the Company,
and neither the Participant nor his Beneficiary nor any other person will have any rights in or
against any amount credited to the Account or any other specific assets of the Company. All
amounts credited to the Accounts will constitute general assets of the Company.

11.03 Trust Agreement. Notwithstanding the provisions of Section 11.02, the Company
may enter into a trust agreement whereby the Company will agree to contribute amounts to a trust
for the purpose of accumulating assets to fund benefit payments to the Participants. The Company
has the sole discretion to determine the amounts to contribute to the trust. Such trust agreement
will be substantially in the form of a model trust agreement set forth in Internal Revenue Service
Revenue Procedure 92-64, or any subsequent Revenue Procedure, and will include provisions required
in such model trust agreement that all assets of the trust will be subject to the creditors of the
Company in the event of insolvency. The obligations of the Company to the Participant thereunder
may be satisfied in all or in part with the assets of the trust. Any assets of the trust remaining
after all obligations hereunder with respect to the Participant have been satisfied will be paid to
the Company.

ARTICLE XII

General Provisions

12.01 Nontransferability. No Participant or Beneficiary may sell, assign, transfer
encumber or otherwise dispose of the right to receive payments hereunder. A Participant’s rights to
benefit payments under the Plan are not subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment or garnishment by creditors of a Participant
or a Beneficiary.

12.02 Employment Not Guaranteed Plan. The establishment of this Plan and the
designation of an employee as a Participant shall not give any Participant the right to continued
employment with the Company or any Subsidiary or limit the right of the Company or any Subsidiary
to dismiss the Participant or modify the terms of employment of any Participant.

12.03 Notice. Any and all notices, designations or forms provided for herein shall be
in writing and delivered personally or by certified mail, return receipt requested, addressed, in
the case of the Company, to the Corporate Secretary at 11200 West Plank Court, Suite 100,
Wauwatosa, Wisconsin 53226 and, in the case of a Participant or Beneficiary, to his home address as
shown on the records of the Company. The addresses referenced herein may be changed by a notice
delivered in accordance with the requirement of this Section 12.03.

12.04 Limitation on Liability. In no event shall the Company, Administrator or any
employee, officer or director of the Company be liable to any Participant, former Participant or
Beneficiary or other person for any claim, loss, liability or expense incurred with respect to the
Plan, other than the payment of benefits hereunder.

12.05 Special Distribution Provision. Notwithstanding anything to the contrary
contained herein, in the event that (a) the Internal Revenue Service prevails in a claim that all
or any portion of the Participant’s Account constitutes taxable income to the Participant or his
Beneficiary for any taxable year of such Participant prior to the taxable year in which such amount
is distributed to him, or (b) legal counsel satisfactory to the Company and the Participant renders
an opinion that the Internal Revenue Service would likely prevail in such a claim, the affected
portion of the Participant’s Account shall be immediately distributed to the Participant (or his
Beneficiary). For purposes of this Section 12.05, the Internal Revenue Service shall be deemed to
have prevailed in a claim if such claim is upheld by a court of final jurisdiction, or if the
Company or the Participant, based upon an opinion of legal counsel satisfactory to the Company and
the Participant, fails to appeal a decision of the Internal Revenue Service, or a court of
applicable jurisdiction, with respect to such claim, to an appropriate Internal Revenue Service
appeals authority or to a court of higher jurisdiction within the appropriate time period.

12.06 Taxes. The Company shall have the right to deduct from all amounts paid
pursuant to the Plan any amount required by law to be withheld to satisfy a tax obligation. The
Participant, his Beneficiary or his estate shall be solely liable for the payment of any tax
obligation that arises from a payment under the Plan.

12.07 Incapacity of Recipient. Subject to applicable state law, if any person
entitled to a payment under the Plan is deemed by the Administrator to be incapable of personally
receiving and giving a valid receipt for such payment, then, unless and until claim therefor shall
have been made by a duly appointed guardian or other legal representative of such person, the
Administrator may provide for such payment or any part thereof to be made to any other person or
institution then contributing toward or providing for the care and maintenance of such person. Any
such payment shall be a payment for the account of such person and a complete discharge of any
liability of the Administrator, the Company and the Plan therefor.

12.08 Severability. Any provision of this Plan prohibited by law shall be ineffective
to the extent of any such prohibition, without invalidating the remaining provisions hereof. The
illegal or invalid provisions shall be fully severable and this Plan shall be construed and
enforced as if the illegal or invalid provisions had never been inserted in this Plan.

12.09 Headings. All articles and headings under this Plan are intended merely for
convenience and shall in no way be deemed to modify or supplement the actual terms and provisions
stated thereunder.

12.10 Applicable Law. The Plan shall be construed and administered under the laws of
the State of Wisconsin except to the extent preempted by federal law.

12.11 Acceleration of Payments. Except as specifically permitted herein or in other
sections of this Plan, no acceleration of the time or schedule of any payment may be made
hereunder. Notwithstanding the foregoing, payments may be accelerated hereunder by the Company, in
accordance with the provisions of Treasury Regulation Section 1.409A-3(j)(4) and any subsequent
guidance issued by the United States Treasury Department. Accordingly, payments may be
accelerated, in accordance with requirements and conditions of the Treasury Regulations (or
subsequent guidance) in the following circumstances: (i) as a result of certain domestic relations
orders; (ii) in compliance with ethics agreements with the Federal government; (iii) in compliance
with ethics laws or conflicts of interest laws; (iv) in limited cash-outs (but not in excess of the
limit under Code Section 402(g)(1)(B)); (v) in the case of certain distributions to avoid a
non-allocation year under Code Section 409(p); (vi) to apply certain offsets in satisfaction of a
debt of the Participant to the Company; (vii) in satisfaction of certain bona fide disputes between
the Participant and the Company; or (viii) for any other purpose set forth in the Treasury
Regulations and subsequent guidance.

2

• * *

IN WITNESS WHEREOF, the Company has amended and restated this Wauwatosa Savings Bank Executive
Deferred Compensation Plan, effective September 1, 2006.

	 	 	 
	 	 	WAUWATOSA SAVINGS BANK
	Date: February 19, 2008

	 	

	
 
	 	By: Richard C. Larson
	
 
	 	Its: Chief Financial Officer

3

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