Document:

exh10_2.htm

Exhibit 10.2

    AMENDING
      AGREEMENT

    

    

    THIS
      AGREEMENT made the 29th day of June, 2007

    

    

    BETWEEN:

    LML
      PAYMENT SYSTEMS INC., a corporation continued  under the laws
      of the Yukon Territory

    

    (“LML”)

    

    AND:

    BEANSTREAM
      INTERNET COMMERCE INC., a corporation incorporated under the laws of
      British Columbia

     

    (“Beanstream”)

    

    AND:

    CRAIG
      THOMSON, an individual residing at 4787 Amblewood Drive, Victoria,
      British Columbia, V8Y 2S2

    

    (the
      “Employee”)

    

    WHEREAS:

    

    
      	
              A.

            	
              Beanstream
                and the Employee are parties to an employment agreement dated December
                1,
                2006 (the “Original Agreement”) whereby Beanstream has
                retained the services of the Employee in acting as its President
                and Chief
                Executive Officer;

            

    

    

    
      	
              B.

            	
              Pursuant
                to an Arrangement Agreement dated April 30, 2007 as amended by an
                amending
                agreement dated May 24, 2007 between LML and Beanstream, LML acquired
                all
                of the issued and outstanding shares in the capital stock of Beanstream;
                and

            

    

    

    
      	
              C

            	
              The
                parties now wish to make certain amendments to the Original Agreement
                upon
                the terms and conditions set out in this
                Agreement;

            

    

    

    NOW,
      THEREFORE, in consideration of the mutual covenants and agreements set forth
      herein and other valuable consideration (the receipt and sufficiency of which
      is
      hereby acknowledged), the parties hereto covenant and agree as
      follows:

     

    

      
        	
                1.

              	
                Section
                  3.6 and Section 3.7 of the Original Agreement are deleted in their
                  entirety.

              

      

      

      
        	
                2.

              	
                The
                  following provision is added to the Original Agreement as a new
                  Section
                  3.6:

              

      

       

    

    “3.6           The
      Employee is eligible to be awarded options to purchase Common Shares in the
      capital stock of LML by the Stock Option Committee of LML or the Compensation
      Committee of LML, as the case may be.”

     

    
      	
              3.

            	
              All
                provisions of the Original Agreement which are not amended by this
                Agreement remain unchanged and the amendments contemplated in Sections
                1
                and 2 hereof  taken together with all other unamended provisions
                of the Original Agreement form the employment agreement between Beanstream
                and the Employee as if such amendments formed part of the Original
                Agreement.

            

    

    

    IN
      WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
      on
      the day and year first above written.

     

    
      	
              LML
                PAYMENT SYSTEMS INC.

            	 	 
	 	 	 
	
              Per:
                /s/ Patrick H. Gaines

            	 	 
	
              Authorized
                Signatory

            	 	 
	 	 	 
	
              BEANSTREAM
                INTERNET COMMERCE INC.

            	 	 
	 	 	 
	
              Per:
                /s/ Craig Thomson

            	 	 
	
              Authorized
                Signatory

            	 	 
	 	 	 
	
              CRAIG
                THOMSON

            	 	 
	 	 	 
	
              /s/
                Craig Thomson

            	 	
              /s/
                Chris Koide

            
	
              Signature

            	 	
              Witness
                Signature

            
	 	 	 
	 	 	
              Chris
                Koide

            
	 	 	
              Print
                Witness Nameexh10-1.htm

    
      

    

    Back
      to Form 8-K

    Exhibit
      10.1

     

    

    
      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
        # H0967

    

    
      

      Between

    

    
       

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

    

    
       

      and

    

    
      

      WellCare
        Health Insurance 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

    

    
      

      5

    

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    
      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 enrolles 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 enrolles 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

               

            
	
              WellCare
                Health Insurance 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 WellCare
        Health Insurance of Illinois, Inc., a Medicare managed
        care-organization (hereinafter referred to as the MA-PD Sponsor) agree to
        amend
        the contract (H0967 ) 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

               

            
	
              WellCare
                Health Insurance 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

       

       

      12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}]]