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EXHIBIT 10.10
RISK CONTRACT MANAGEMENT AGREEMENT
THIS RISK CONTRACT MANAGEMENT AGREEMENT ("Agreement" is made and
entered into this 1st day of May, 1995 (the "Effective Date"), by and between
Elmhurst Physician Hospital Organization, L.L.C. (d/b/a ElmCare), an Illinois
limited liability company ("ElmCare") and North American Medical Management -
Illinois, Inc., an Illinois general business corporation ("NAMM").
W I T N E S S E T H:
WHEREAS, ElmCare operates as a physician-hospital organization ("PHO")
providing managed care contracting services to managed care payors, including
health maintenance organizations ("HMOs"), insurance companies and other third
party payors;
WHEREAS, ElmCare arranges for the provision of physician and hospital
services to be provided to subscribers and beneficiaries of third party payors'
health plans;
WHEREAS, ElmCare arranges for the provision of such services by
accepting both capitated payments and fee-for-service payments from third party
payors;
WHEREAS, NAMM is in the business of providing management and
administrative services to nonprofit corporations, physicians, PHOs, independent
practice associations ("IPAs") and other professional health care entities and
individuals;
WHEREAS, NAMM provides such services in connection with such
organizations' arrangement of health care services pursuant to capitated
arrangements with third party payors;
WHEREAS, ElmCare desires to obtain certain management and
administrative services of NAMM, on the terms and conditions described more
fully herein, in connection with the administration of ElmCare's capitated
arrangements with third party payors;
WHEREAS, NAMM desires to provide certain management and administrative
services to ElmCare, on the terms and conditions described more fully herein, in
connection with the administration of ElmCare's capitated arrangements with
third party payors, including the management of risks that ElmCare will
undertake with third party payors and the negotiation, monitoring and quality
assurance of capitated arrangements with third party payors;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein and other good and valid consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto covenant
and agree as follows:
ARTICLE 1.
DEFINITIONS
Unless otherwise defined herein, the capitalized terms used in this
Agreement shall have the following meanings:
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1.1. "Full Risk Contract" shall mean a risk contract in which
physician and hospital services are paid on a capitated or fixed per member
payment basis.
1.2. "Medical Services" shall mean general medical, specialty and other
health care services provided by physicians and other professional medical
personnel pursuant to Risk Contracts entered into by ElmCare.
1.3. "NAMM Surplus Percentage" shall mean:
(a) With respect to each Professional Risk Contract, a percentage
agreed to by ElmCare and NAMM prior to ElmCare's entering into such
contract, which percentage shall be as set forth in Schedule 1.3 or as
added thereto; and
(b) With respect to Full Risk Contracts, a percentage agreed to
by ElmCare and NAMM prior to ElmCare's entering into such contract,
which percentage shall be as set forth in Schedule 1.3 or as added
thereto.
1.4. "PODS" shall mean separately identifiable groups of physicians who
are contract providers with ElmCare, which groups will function under Risk
Contracts entered into by ElmCare as separate identifiable risk groups.
1.5. "Net Balance" shall mean, with respect to each Risk Contract, an
amount equal to the sum of.
(a) ElmCare's share of the net surplus, if any, of the "hospital
fund" paid under the applicable Risk Contract to ElmCare; plus
(b) The aggregate surplus or deficit of funds in all
internally-developed PODS risk pools and withholding pools that are
created by NAMM under Section 2.3(b) measured at year-end for the
applicable Risk Contract (for purposes of computing this amount, PODS
risk pools or withholding pools that have a deficit balance will be
deducted from PODS risk pools or withholding pools that have a surplus
balance); plus
(c) ElmCare's share of the net surplus or net deficit, if any, of
other risk pools or withholding pools created under the applicable Risk
Contract and paid to ElmCare (for purposes of computing this amount,
risk pools or withholding pools that have a deficit balance will be
deducted from risk pools or withholding pools that have a surplus
balance).
1.6. "Professional Risk Contract" shall mean a risk contract in which
physician, but not hospital, services are paid on a capitated or fixed per
member payment basis.
1.7. "Risk Contract" shall mean full service contracts between third
party payors and ElmCare pursuant to which third party payors reimburse ElmCare
for any portion of the Medical Services rendered by physicians is paid on a
capitated or fixed per member payment basis. Risk Contracts shall be set forth
in Schedule 1.3 hereto, and amended from time-to-time to reflect new and
terminated Risk Contracts.
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1.8. "Territory" shall mean the following zip code areas:
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Town Zip Code Town Zip Code
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Addison 60101 Lombard 60148
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Bensenville 60106 Northlake 60164
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Berkeley 00000 Xxx Xxxxx/Xxxxxxxx 00000
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Elmhurst 00000 Xxx Xxxxx Xxxxxxx/ Xxxxx Xxxx 00000
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Xxxxxxxx Xxxx 00000 Xxxxx Xxxx 60165
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Hillside 60162 Westchester 60154
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Itasca 60143 Wood Xxxx 60191
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ARTICLE 2.
RESPONSIBILITIES OF NAMM
2.1. Generally. While this Agreement is in effect, NAMM shall provide
such management and administrative services as are set forth in this Article 2.
2.2. Negotiation of Risk Contracts. NAMM shall negotiate with third
party payors Risk Contracts on behalf of ElmCare; provided, however, that NAMM
shall not have the authority to bind ElmCare or execute any agreements on behalf
of ElmCare, including but not limited to Risk Contracts. Any Risk Contract
negotiated by NAMM on behalf of ElmCare shall become binding upon ElmCare only
upon ElmCare's approval of such arrangement and execution of a definitive
agreement with the third party payor. Prior to NAMM negotiating any Risk
Contract on behalf of ElmCare, ElmCare shall provide NAMM with a list of
contracting parameters that NAMM shall utilize and use all reasonable efforts to
negotiate and include in Risk Contracts it negotiates on behalf of ElmCare.
Notwithstanding anything to the contrary, ElmCare shall have the ability to
negotiate and enter into specialty contracts that are not covered by this
Agreement and for which NAMM shall have no responsibility for administering. In
the event that ElmCare enters into such a specialty contract, ElmCare shall
provide NAMM with notice of ElmCare's entering into the agreement.
2.3. Administration of Risk Contracts. NAMM shall provide all
management and administrative services necessary and appropriate for the
administration of Risk Contracts entered into by ElmCare, including but not
limited to:
(a) Management of Risk. The management of actuarial risks that
ElmCare has undertaken with third party payors, the monitoring and
quality assurance of such Risk Contracts.
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(b) Allocation of Funds. NAMM shall, in good faith and based upon
general parameters developed by NAMM and approved by ElmCare, allocate
capitated payments negotiated with third party payors under the risk
contracts (to the extent that the third party payor has not already
allocated the capitated payments) among the various ElmCare contracting
providers. In addition, NAMM shall, in good faith and based upon
general parameters developed by NAMM and approved by ElmCare, develop
internal "risk pools" and "withhold pools" to create incentives for
providers to efficiently provide services under the Risk Contracts (the
"NAMM Pools"). The NAMM Pools need not coincide with or be identical to
risk pools or withhold arrangements established under the Risk
Contracts. In creating the amounts to fund such pools, NAMM shall
subtract from the capitated payments received under the Risk Contracts:
(a) an amount determined by NAMM as the aggregate capitated rates to be
paid by ElmCare to providers; and (b) the Administrative Expense Charge
due to NAMM under Section 4.3 below.
(c) Coordination of Benefits. NAMM shall coordinate benefits for
enrollees covered by Risk Contracts. NAMM shall coordinate benefits for
claims involving multiple payors, and use all reasonable efforts to
maximize reimbursement to the benefit of ElmCare and its contract
providers.
(d) Eligibility and Assignment. Except in the case of the initial
start-up of a Risk Contract or a major enrollment (defined as the
enrollment of 1,000 or more lives), NAMM shall process (including
electronic data input) all member eligibility information, including
additions, updates and deletions of such information, within two (2)
business days of receipt of such information from ElmCare or a third
party payor. In the case of the initial start-up of a Risk Contract or
a major enrollment (defined as the enrollment of 1,000 or more lives),
NAMM shall process (including electronic data input) all member
eligibility information, including additions, updates and deletions of
such information, within five (5) business days of receipt of such
information from ElmCare or a third party payor. In the event that NAMM
receives such information directly from a third party payor, NAMM shall
immediately provide ElmCare with a copy of such information.
Non-compliance with this subsection will entitle ElmCare to withhold
payment of the monthly fee due to NAMM under Section 4.3 until such
time as NAMM is substantially in compliance. With respect to assignment
of members to primary care physicians under the Risk Contracts, to the
extent such assignment is not performed by a third party payor, ElmCare
shall be responsible for assigning members to primary care physicians.
NAMM shall provide ElmCare with access to its computer systems as
necessary to permit ElmCare to have on-line access to eligibility
information.
(e) Claims Processing. NAMM agrees to process all physician,
hospital and other ancillary providers' service claims under Risk
Contracts. With respect to any claims received by NAMM that are not
"clean" claims, NAMM shall use its best efforts to make such claim a
"clean" claim for processing within five (5) business days. In the
event that NAMM is unable to make a claim a "clean" claim, then NAMM
shall return the claim to the originating provider and provide the
provider with notice of the adjudication problems/issues no later than
ten (10) business days after NAMM's original
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receipt of the claim. NAMM shall identify and eliminate payment of
duplicate claims, unauthorized claims and claims representing unbundled
services. NAMM shall develop policies and procedures designed to
address and eliminate duplicate claims, unauthorized claims and claims
representing unbundled services. All questions and inquiries from
ElmCare, physicians under contract with ElmCare and other providers
under contract with ElmCare regarding the processing and payment of
claims shall be directed to, and handled by, NAMM within a timely and
efficient manner.
(f) Electronic Interface. NAMM will use reasonable efforts to
interface electronically with those physician and other provider
offices that use Medical Manager(R) software or such other software as
is designated by ElmCare. NAMM also will use reasonable efforts to
interface electronically with physician and other provider offices for
claims submission by the physicians and other providers that utilize
other software. NAMM shall provide electronic data and interface with
the corporate office of ElmCare to provide ElmCare with access to all
financial and utilization data relating to ElmCare's performance under
the Risk Contracts, including but not limited to data related to NAMM's
administration of the PODS, PODS-specific utilization and financial
data, physician-specific utilization and financial data, aggregate
(i.e., for all of ElmCare) utilization and financial data, ancillary
provider utilization and financial data (including hospital and other
institutional providers), eligibility listings, claims history and case
management.
(g) Claims Payment. NAMM agrees to pay claims in accordance with
contracted or capitated rates under Risk Contracts, implementing
appropriate deductibles and co-insurance as applicable to the
enrollees' benefit plan under the Risk Contracts. NAMM agrees to pay
all "clean" undisputed claims within thirty (30) days of receipt of the
claim. Non-compliance with this subsection will entitle ElmCare to
withhold payment of the monthly fee due to NAMM under Section 4.3 until
such time as NAMM is substantially in compliance. With respect to
claims made from providers without contracts with ElmCare and without
contracts with NAMM, NAMM will use its best efforts to negotiate
payment rates for such non-contracting providers, which rates are
consistent with those applying to providers contracting with ElmCare.
With respect to claims made from providers without contracts with
ElmCare, but that have contracts with NAMM, NAMM shall use its best
efforts to provide ElmCare with the rates negotiated by NAMM under its
agreements with such other PHOs and IPAs. NAMM shall permit ElmCare to
audit NAMM's claims payment history.
(h) Reinsurance. NAMM shall use its best efforts in its
negotiations with payors under the Risk Contracts to standardize
reinsurance coverage and liability. NAMM shall apply and administer the
appropriate reinsurance relative to each Risk Contract for all
providers under the Risk Contracts.
(i) Enrollee Services. ElmCare will provide NAMM with eligibility
lists of enrollees under the Risk Contracts either as such lists are
provided by the applicable payor or as such lists are developed by
ElmCare. ElmCare and XXXX xxxxx xxxxxxx
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xxxxxxx xxxxxxxx instructions and materials to be distributed by NAMM
to enrollees under Risk Contracts. Through member service staffing,
NAMM shall respond to all enrollee inquiries, issues and informal
grievances, and shall use its best efforts to resolve such matters
within three (3) business days. Through appropriate clinical staffing,
NAMM shall respond to all enrollee inquiries, issues and informal
grievances related to patient care and case management issues, and
shall use its best efforts to resolve such matters within three (3)
business days. NAMM shall provide ElmCare with notice of all formal
grievances, and such matters shall be resolved jointly by ElmCare and
NAMM within the terms and conditions of the applicable Risk Contract
and rules and regulations of the State of Illinois applicable to such
grievance. NAMM shall cooperate fully with ElmCare to market the
services available from ElmCare and to maximize contract enrollment
under the Risk Contracts.
(j) Enrollee Education. NAMM shall make its facilities and staff
available at all reasonable times for use in a program of enrollee
health education, including education in the contribution each enrollee
can make to the maintenance of his/her health, instruction on personal
health care measures, nutritional education and counseling, information
about services available from ElmCare and information on generally
accepted medical standards for use and frequency of such services.
(k) Provider Services to ElmCare. NAMM shall provide the
following:
(i) Assist ElmCare in physician education relating to Risk
Contracts, and assistance in the selection of PODS formation.
(ii) Develop for ElmCare approval the following documents
relative to Risk Contracts:
(a) QA/UR plan;
(b) Member grievance plan;
(c) Case management protocols;
(d) Claim adjudication policies and procedures;
(e) Policies and procedures for addressing and
eliminating duplicate claims, unauthorized claims and claims
representing unbundled services; and
(f) Coordination of benefits policies and procedures.
(iii) Cooperate with and assist ElmCare staff as necessary to
assure efficient and effective performance by ElmCare and its
physicians under the Risk Contracts, including but not limited to
cooperating and assisting ElmCare staff in addressing contract
issues, member services and case management.
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(iv) Allow ElmCare access to, and participation in,
NAMM-Texas national reinsurance contract upon the same terms and
conditions as provided to OTHER SIMILAR organizations that
participate in the NAMM-Texas national reinsurance contract. In
the event that the NAMM-Texas national reinsurance contract is
canceled or otherwise terminated, NAMM shall use its best efforts
to obtain reinsurance coverage from another third party upon
substantially the same terms and conditions.
(1) Provider Services to PODS. NAMM shall assist ElmCare and its
contracting physicians in the establishment of PODS, including but not
limited to performing the following services:
(i) Provide education and assistance to primary care
physicians in understanding the components key to PODS success
enabling the physicians to select PODS composition.
(ii) Provide financial models to primary care physicians to
enable them to better understand PODS funding, reimbursement,
incentive and bonus mechanisms.
(iii) As PODS are established, provide education and
assistance to primary care physicians enabling them to select
appropriate specialists to participate in the PODS.
(iv) Provide financial models to specialty physicians
explaining capitation and other applicable reimbursement
mechanisms in general, and explaining funding, reimbursement,
incentive and bonus mechanisms specific to their specialty within
their PODS.
(v) Provide assistance to PODS as needed to fully-develop the
PODS and its specialty physician network.
(vi) Assist PODS in selecting an appropriate medical
director/physician case manager, counsel PODS on the options
available for the use of the medical director/physician case
manager and assist in the establishment of the medical
director/physician case manager's duties within the PODS.
(vii) Provide appropriate quality and utilization management
staff to assist PODS in the implementation and administration of
the quality assurance/utilization management plan, case
management, protocols and guidelines established by ElmCare, and
to ensure adherence to clinical Risk Contract parameters.
(viii) Except as otherwise expressly stated herein, provide
all PODS-specific reports to PODS on a monthly basis or on such
other basis as agreed upon by the parties, including reports
indicating each PODS performance relative to
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other PODS performance; provided, however, that such reports shall
not include PODS-specific pricing information.
(ix) Coordinate with PODS to provide all concurrent
review/utilization authorization to ensure adherence to clinical
Risk Contract parameters.
(x) Arrange for cost-effective discharge planning and
utilization of ancillary contract providers.
(xi) Provide appropriate monthly and quarterly reports
relative to PODS fund status and bonus surplus checks instituting
the appropriate IBNR calculations as experienced by the PODS or as
necessary for ElmCare in general. This will be provided within
thirty (30) days following the end of each month or quarter.
Whether such reports and checks shall be provided on a monthly or
quarterly basis shall be determined by the board of managers of
ElmCare and reported to NAMM.
(xii) NAMM may recommend and implement, as approved by the
board of managers of ElmCare, other withhold or risk pool
arrangements on a PODS basis to create and reward effective
utilization of services under the Risk Contracts.
(xiii) Provide capitation checks and monthly eligibility
reports no later than (a) the twenty-second (22nd) day of each
month or (b) five (5) days after receipt of the last eligibility
report by NAMM, whichever is sooner.
(m) Actuarial Services. The parties acknowledge and agree that a
material part of this Agreement is the provision of actuarial formulas
developed by or through North American Medical Management, Inc., a
Texas corporation ("NAMM-Texas") and its President, Xx. Xxxxxxx X.
Xxxxxx, F.S.A. ("Fritch"). ElmCare and NAMM acknowledge and agree that,
notwithstanding NAMM's performance of services hereunder, all actuarial
formulas to be used by NAMM in its performance hereunder will be those
formulas developed by NAMM-Texas as modified for application for the
ElmCare marketplace and verified in writing by Fritch. Services of
NAMM-Texas and Fritch necessary to enable NAMM to perform under this
Agreement shall be included within annual budget developed under
Article 3. NAMM also shall cause Fritch to be available as reasonably
requested by ElmCare on an as needed basis for the provision of
consulting services to ElmCare, which services shall be considered
services covered under Section 2.14 of this Agreement.
(n) HEDIS Compliance. NAMM shall comply with, and provide
information to ElmCare necessary to assure compliance with, Health
Employer Data and Information Set ("HEDIS").
(o) Licensure and Accreditation. NAMM shall assist and cooperate
fully with ElmCare and its contract providers and shall provide such
information in the possession
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of NAMM that is reasonably necessary for Elmcare and its contract
providers to satisfy applicable licensure and accreditation standards
that are imposed upon ElmCare by ACCREDITING BODIES OR BY PAYORS WITH
which ElmCare contracts if such payor imposes standards upon ElmCare,
including but not limited to National Committee on Quality Assurance
("NCQA").
In connection with the provision of the services under this Article 2, NAMM
shall provide support services, personnel, administration, financial services,
data processing, debt collection, accounting services and other business
services necessary and appropriate for NAMM's performance hereunder.
Notwithstanding anything to the contrary, the parties acknowledge and agree
that: (a) all physicians who are obligated to provide services under Risk
Contracts entered into by ElmCare shall be solely responsible for, and shall
have complete authority, supervision and control over, the provision of all
Medical Services performed for subscribers; and (b) all diagnoses, treatments
and procedures related to Medical Services shall be provided and performed under
the supervision of such physicians as such physicians, in their sole discretion,
deem appropriate.
2.4. NAMM Personnel. NAMM shall employ or otherwise retain, at NAMM's
sole expense, and shall be responsible for selecting, training, supervising and
terminating all personnel as are reasonably necessary and appropriate for NAMM's
performance of its obligations hereunder. NAMM shall have the sole
responsibility for determining the salaries and employee benefits of all
personnel it employs, for paying such salaries and for providing such benefits.
All such personnel employed or retained by NAMM shall be qualified and
sufficiently experienced to enable them to perform their duties on behalf of
ElmCare. NAMM and ElmCare will review annually the appropriateness of the
staffing and the personnel supplied by NAMM. In employing and retaining such
personnel, NAMM shall abide by any and all applicable federal and state
employment related statutes, rules and regulations.
2.5. NAMM Administrator. Notwithstanding anything to the contrary,
while this Agreement is in effect, NAMM shall at all times provide an
administrator responsible for ensuring the performance of services by NAMM for
ElmCare. The administrator provided by NAMM to ElmCare shall provide services
exclusively for ElmCare while this Agreement is in effect. In the event that the
administrator is terminated or terminates his/her relationship with NAMM, NAMM
shall immediately notify ElmCare. Any individual selected by NAMM to replace the
NAMM administrator provided to ElmCare shall be mutually agreed upon by NAMM and
ElmCare.
2.6. NAMM Medical Advisor. While this Agreement is in effect, NAMM
shall provide a medical advisor responsible for providing medical advice for
ElmCare (the "NAMM Medical Advisor"). The role and responsibility of the NAMM
Medical Advisor shall be as set forth in Schedule 2.6. In the event that the
NAMM Medical Advisor is terminated or terminates his/her relationship with NAMM,
NAMM shall immediately notify ElmCare.
2.7. Non-Exclusivity. Subject to the obligations of NAMM under Section
10.2 below, in recognition of the fact that the nonmedical management and
administrative personnel provided to ElmCare by NAMM pursuant to this Agreement
may, from time-to-time, perform services for
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third parties, this Agreement shall not prevent NAMM from performing such
services for others nor shall it restrict NAMM from using the personnel who
perform services for elmcare hereunder to provide services for other third
parties. Notwithstanding anything to the contrary, the administrator described
in Section 2.5 shall provide services exclusively for ElmCare.
2.8. Quality Assurance, Risk Management and Utilization Review. NAMM
shall assist ElmCare in the establishing and monitoring the implementation of
procedures to promote the consistency, quality, appropriateness and medical
necessity of Medical Services provided by Physicians pursuant to or in
connection with Risk Contracts. NAMM shall provide administrative support for
such procedures and, in connection with Risk Contracts, shall monitor
participation in ElmCare's quality assurance, risk management and utilization
review programs.
2.9. Reports. No later than the last day of each month immediately
following the applicable month during which this Agreement is in effect, NAMM
shall provide ElmCare with the following reports pertaining to the operation of
ElmCare:
(a) A report detailing the cases involving the coordination of
benefits and their status; and
(b) A report, on both a PODS-specific and aggregate for all of
ElmCare basis, detailing utilization and funds status and distribution.
All reports to be delivered by NAMM under this Section 2.9 and elsewhere in this
Agreement shall be provided in a form mutually agreed upon by NAMM and ElmCare.
NAMM shall develop, and provide to ElmCare no later than May 1, 1995, a manual
that shall include the mutually agreed upon format of all reports to be
delivered by NAMM to ElmCare under this Section 2.9 and elsewhere in this
Agreement. Upon reasonable request, NAMM shall make available to ElmCare the
information and data underlying and supporting all such reports.
2.10. PODS Administration and Accounting. NAMM shall administer
payments received pursuant to Risk Contracts on a PODS basis. NAMM shall provide
the accounting and reporting mechanisms necessary to report payments received
and expenses incurred pursuant to Risk Contracts on a PODS basis.
2.11. Administration of Funds.
(a) Establishment, Authority, and Administration. ElmCare shall
establish an account at a financial institution of ElmCare's selection
for the purposes of administering funds under the Risk Contracts.
ElmCare shall provide NAMM with access to such account and with
signature authority on such account for the purposes of administering
funds and claims payment as set forth in this Agreement. The parties
acknowledge that they intend for payments from payors to be received by
ElmCare and deposited into such account by ElmCare; however, in the
event that NAMM receives a payment from a payor, NAMM shall deposit the
payment in the account on behalf of ElmCare and shall notify ElmCare of
the receipt of the payment and the amount of the deposit. XXXX
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shall make all payments to PODS and other providers under the Risk
Contracts with funds from such account.
(b) Limitation of Distribution Amount. Notwithstanding
anything to the contrary, NAMM shall not write a check or otherwise
distribute funds from the account for the purposes of claims payment,
which check or distribution is in excess of Ten Thousand Dollars
($10,000.00), without the prior consent of ElmCare staff designated by
ElmCare as having approval authority.
(c) Limitation on Self Dealing. Notwithstanding anything to
the contrary, NAMM's authority to access the account and administer
funds hereunder shall not entitle NAMM to write checks or otherwise
distribute funds to, or for the benefit, of NAMM. All payments to NAMM
for the provision of services under this Agreement shall be
administered and paid by ElmCare.
2.12. Licenses and Permits. NAMM shall maintain all federal, state and
local licenses and permits necessary for it to perform its obligations
hereunder.
2.13. Other Providers. Upon ElmCare's reasonable request, NAMM shall
perform administrative services reasonably necessary and appropriate to recruit
potential physicians and other providers to contract with ElmCare, and shall
provide ElmCare with model agreements to document ElmCare's service arrangements
with such physicians and other providers. It will be and remain the
responsibility of ElmCare to interview, select, contract with, supervise,
compensate, control and terminate relationships with physicians and other
providers performing Medical Services or other professional services on behalf
of ElmCare, and NAMM shall have no authority or responsibility with respect to
such matters; provided, however, that, upon ElmCare's reasonable request, NAMM
shall assist in the interview, selection and negotiation of arrangements with
such physicians and other providers.
2.14. Additional Consulting Services. In addition to performing its
obligations hereunder, NAMM also may provide additional business and financial
management, consultation and advice as may, from time-to-time, be requested by
ElmCare. In the event that ElmCare requests such services, NAMM shall indicate
to ElmCare that the services requested are not covered under this Agreement and
that NAMM shall assess an additional hourly or fixed charge for services, and
NAMM shall indicate to ElmCare the amount of such hourly or fixed charge and,
prior to performing such services, NAMM shall obtain ElmCare's approval of the
fixed or hourly charge and NAMM's performance of such services.
2.15. Insurance. NAMM shall, at its sole expense, obtain and maintain
with commercial carriers or in the form of self-insurance or some combination
thereof, appropriate workers' compensation coverage for NAMM's employees, and
casualty and comprehensive general liability insurance covering NAMM, NAMM's
employees and NAMM's property in such amounts, on such basis and upon such terms
and conditions as are reasonable in light of NAMM's business. NAMM shall provide
ElmCare with certificates of such coverage annually, and shall notify ElmCare of
any termination or change in such coverage.
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2.16. NAMM Performance Standards. NAMM shall perform its obligations
hereunder diligently and in good faith, and it shall cooperate fully with
ElmCare to provide its services hereunder to the reasonable satisfaction of
ElmCare.
ARTICLE 3.
REVENUES AND EXPENSES
3.1. Budgeted Administrative Expenses. For each year during which this
Agreement is in effect, NAMM shall prepare and submit to ElmCare, not less than
forty-five (45) days prior to the beginning of the next contract year, a budget
of ElmCare's ordinary and necessary administrative expenses incurred in
connection with Risk Contracts, which expenses shall include NAMM's ordinary and
necessary business expenses to be incurred in performing its obligations under
this Agreement ("Budgeted Administrative Expenses"). Such budget shall represent
NAMM's good faith estimate of its actual expenses that will be incurred in
performing hereunder. Such budget shall not include an estimate of any
additional consulting services to be provided pursuant to Section 2.14. Using
this budget, NAMM shall prepare an administrative expense charge schedule, which
schedule will vary based on each month's actual membership enrollment. The
administrative expense charge schedule for the first contract year is set forth
in Section 4.3 below. In every contract year following the initial contract year
hereunder, NAMM also shall provide, as part of the budget process described in
this section, information regarding the most recent year it has actual costs of
administering Chicago-area risk contracts for IPAs and PHOs with which NAMM has
agreements. NAMM and ElmCare shall mutually agree upon NAMM's estimates of
Budgeted Administrative Expenses and NAMM's administrative expense charge
schedule within forty-five (45) days following submission of such materials to
ElmCare.
3.2. Audit of NAMM Expenses. NAMM shall provide to ElmCare copies of
its limited procedure audit and review of cost allocations within thirty (30)
days of their completion. NAMM will attempt to share its cost of performing such
limited procedure audit and review of cost allocations with all other Chicago
area NAMM clients. In addition, ElmCare, at its option and sole expense, has the
right to audit NAMM's actual expenses incurred in connection with its provision
of services hereunder. NAMM shall cooperate in good faith with ElmCare and
provide ElmCare with reasonable access to information necessary to permit
ElmCare to perform such audit.
ARTICLE 4.
COMPENSATION FOR ADMINISTRATIVE SERVICES
4.1. Generally. ElmCare and NAMM acknowledge that NAMM will incur costs
on behalf of ElmCare in performing its obligations hereunder. Accordingly,
ElmCare shall compensate NAMM for its administrative services as set forth in
this Article 4.
4.2. Development Fee. On the last day of each month from 1, 1994
until June 30, 1995, ElmCare shall pay to NAMM a development fee for NAMM's
ordinary and necessary business expenses incurred before June 30, 1995 in
rendering services on behalf of ElmCare. Expenses incurred by NAMM following
June 30, 1995 shall be included with the Budgeted Administrative Expenses.
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4.3. Monthly Administrative Fee. For each month during which this
Agreement is in effect, ElmCare shall pay to NAMM a monthly fee in the amount of
the sum of:
-----------------------------------------------------------
Administrative Expense Charge
-----------------------------------------------------------
Professional Risk Contracts Full Risk Contracts
--------------------------------------------------------------------------------
Commercial Payors $4.50 pmpm $6.00 pmpm
--------------------------------------------------------------------------------
Medicare 4.0% of premium amount 4.5% of premium amount
--------------------------------------------------------------------------------
Such monthly amounts shall be paid to NAMM on the tenth (10th) day of each month
following month in which ElmCare receives payments under such Risk Contracts.
4.4. Adjustment to Administrative Expense Charge. The parties
acknowledge that the monthly fees paid pursuant to Section 4.3 are intended to
reimburse NAMM for its actual expenses incurred in performing its obligations
hereunder. Accordingly, the parties agree that they shall review the amounts as
described in Section 3.1. The parties shall, in good faith, determine whether
to increase or decrease such payments as is necessary, based upon the enrollment
in ElmCare Risk Contracts, so that the aggregate annual amount of payments made
to NAMM shall approximate its actual costs in performing its obligations
hereunder.
ARTICLE 5.
CLINICAL PERFORMANCE BONUS PAYMENTS
5.1. Generally. For each year during which this Agreement is in effect,
ElmCare shall pay to NAMM the amount, if any, determined pursuant to this
Article 5 as a clinical performance bonus.
5.2. Determination of Net Surplus. At the end of each year during which
this Agreement is in effect, or more frequently as determined by NAMM and
ElmCare, ElmCare and NAMM shall determine (a) the Net Balance for each
Professional Risk Contract multiplied by (b) the NAMM Surplus Percentage for
that contract. NAMM shall aggregate the amounts so computed for all Risk
Contracts (such aggregate amount is referred to as the "NAMM Clinical Bonus").
In the event that the NAMM Clinical Bonus is a positive number, ElmCare shall
pay to NAMM an amount equal to the NAMM Clinical Bonus so computed.
5.3. Payment of Clinical Bonus. Within thirty (30) days of the
determination of the NAMM Clinical Bonus, ElmCare shall pay to NAMM the amount,
if any, due under Section 5.2.
ARTICLE 6.
TERM AND TERMINATION
6.1. Initial Term; Renewal. Unless sooner terminated pursuant to this
Article 6, the initial term of this Agreement shall be five (5) years from the
Effective Date. This Agreement shall automatically renew at the end of the
initial term, and each subsequent term, for an
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additional one (1) year term, unless either party provides the other party with
written notice of its intent to terminate the Agreement at least ninety (90)
days prior to the end of the then current term.
6.2. Termination by Mutual Agreement. This Agreement may be terminated
at any time prior to the end of the then current term by the mutual written
agreement of the parties hereto, and such termination shall be effective as of
the date specified in such mutual written agreement.
6.3. Termination for Material Breach. Either party may terminate this
Agreement prior to the end of the then current term, by giving written notice to
the other party, if the other party fails or neglects to perform, keep or
observe any material term, provision, condition or covenant contained in this
Agreement and the same is not cured or being cured to the non-breaching party's
reasonable satisfaction within thirty (30) days after the non-breaching party
gives the other party written notice specifying the nature and extent of such
material breach; provided that if such breach reasonably requires more than
thirty (30) days to cure, the non-breaching party shall not terminate this
Agreement if measures to cure the breach are undertaken within thirty (30) days
of such notice and thereafter are diligently pursued and corrected.
6.4. Termination for Insolvency. Either party may terminate this
Agreement immediately and without notice in the event that an application is
made by the other party for the appointment of a receiver, trustee or custodian
for any of the other party's assets; a petition under any section or chapter of
the federal Bankruptcy Code or any similar law or regulation is filed by or
against the other party and is not dismissed within sixty (60) days; the other
party makes an assignment for the benefit of his creditors; or the other party
becomes insolvent or fails generally to pay his debts as they become due.
6.5. Termination Due to Legislative or Administrative Changes. In the
event that any legislation, regulation or government policy is passed or
adopted, or any judicial interpretation or ruling is made, that has a material
adverse affect on ElmCare's ability to obtain reimbursement from Medicare or
Medicaid or any other third-party payor due to the existence of any provision of
this Agreement, then the parties agree to negotiate in good faith to modify the
terms of this Agreement to comply with such legislation, regulation, policy,
interpretation or ruling. If the parties cannot reach an agreement on such
modification, either party may terminate this Agreement by providing the other
party with written notice of its intent to terminate the Agreement at least
thirty (30) days prior the effective date of termination, which date shall be
set forth in such notice.
6.6. Termination Due to Change in Control or Merger. In the event of a
"change in control" of NAMM or NAMM merges or consolidates, is dissolved, or
sells all or substantially all of its assets, then NAMM shall give ElmCare at
least ninety (90) days' prior written notice of the effective date of such event
and ElmCare, at its option, may terminate this Agreement by providing NAMM with
written notice of its intent to terminate this Agreement within ninety (90) days
of the receipt of NAMM's notice. For purposes of this Section 6.6, any of the
following shall constitute a "change in control" of NAMM: (a) the sale or
transfer of fifty percent (50%) or more of the stock of NAMM; or (b) the
granting of the right to elect a majority of the board of
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directors of NAMM to an individual or entity that/who does not have such right
as of the Effective Date.
6.7. Termination Due to Termination of Xxxxxx. In the event that, at
any time prior to January 1, 1998, Fritch terminates his employment with, or is
terminated by, NAMM-Texas, ElmCare, at its option, may terminate this Agreement
by providing NAMM with thirty (30) days' prior written notice.
6.8. Termination Due to Continuing Losses. At the end of each twelve
(12) month period while this Agreement is in effect (i.e., annually), NAMM shall
determine whether ElmCare has a net "deficit" under all Risk Contracts in
aggregate. In the event that ElmCare experiences a net "deficit" under all Risk
Contracts in aggregate, then ElmCare, at its option, may terminate this
Agreement by providing NAMM with thirty (30) days' prior written notice, unless
NAMM and ElmCare mutually agree upon a plan of correction designed to eliminate
the deficit (in which case the Risk Contracts for which the plan of correction
is developed will be re-examined at the end of the following year). For purposes
of this Section 6.8, a "deficit" will be deemed to exist with respect to a Risk
Contract if the funds available to ElmCare under that Risk Contract (including
any funds held in risk pools or withholding pools) are insufficient to pay
ElmCare's obligations to providers (including but not limited to ElmCare's
obligation related to current payables and IBNR claims) under that Risk
Contract.
6.9. Effect of Termination. Upon termination of this Agreement, for
whatever reason:
(a) Neither party shall have any further obligations hereunder,
except for: (i) obligations accruing prior to the effective date of
termination; (ii) obligations under this Section 6.9; and (iii)
obligations, promises or covenants set forth here that are expressly
stated herein to extend beyond termination.
(b) NAMM shall surrender and deliver to ElmCare all books and
records in NAMM's possession pertaining to ElmCare's business and all
data and information relating to ElmCare's business, except as
otherwise expressly provided in this Agreement.
(c) Each party shall provide the other party with reasonable
access to records and documents pertaining to the parties' performance
under this Agreement for the purposes of defending against law suits,
preparing income tax returns and other reasonable purposes. Such access
shall be provided upon receipt of prior written notice of the need for
access, and such access shall occur during the normal business hours of
the party making the records and documents available.
(d) NAMM shall provide a final accounting of its Annual Expenses
for that period of the contract year prior to the effective date of
termination, and the parties shall compute payments due pursuant to
Article 4 by treating the effective date of termination as if it is a
year end. In the event that the effective date of termination does not
coincide with the end of any Risk Contract's year or term, then the
determination of whether a payment is due to NAMM pursuant to Article 5
from a net surplus payment made by the third party payor under that
Risk Contract shall be made on a pro rata. basis (i.e., by
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multiplying the amount of the net surplus by a fraction the numerator
of which is the number of days in the year preceding the effective date
of termination and the denominator of which is three hundred sixty-five
(365)).
(e) The parties shall fully cooperate in resolving and finalizing
all matters relating to the parties' performance under this Agreement.
ARTICLE 7.
RECORDS, DOCUMENTS AND DATA
7.1. Records and Reports. In performing its obligations hereunder, NAMM
and its employees will generate records and reports pertaining to the business
of ElmCare, which records and reports shall be kept in the format as determined
by ElmCare. All such records and reports shall be and remain the property of
ElmCare. Nothing in this section shall, or shall be deemed to, limit access by
patients of ElmCare to their medical records as permitted by law.
7.2. Data. In performing its obligations hereunder, NAMM and its
employees will generate data and information, including but not limited to
computer tapes and data, pertaining to the business of ElmCare and pertaining to
the provision of services under Risk Contracts. All such data and information
shall be and remain the property of ElmCare.
7.3. Access to Documents by NAMM. While this Agreement is in effect,
ElmCare shall provide reasonable access to such documents, records and data of
ElmCare as necessary to permit NAMM to perform its obligations hereunder. Such
access shall be provided upon receipt of prior written notice of the need for
access, and such access shall occur during the normal business hours of ElmCare.
ARTICLE 8.
RESPONSIBILITIES OF ELMCARE
8.1. Medical Services. While this Agreement is in effect, ElmCare shall
arrange for, through agreements with physicians, IPAs, professional corporations
and other physician organizations, the provision of Medical Services necessary
to perform under Risk Contracts entered into by ElmCare. Notwithstanding
anything to the contrary, physicians providing such services shall exercise
independent medical judgment and shall have full authority over all Medical
Services and clinical decisions pertaining to the delivery of medical care.
8.2. Quality Assurance, Risk Management and Utilization Review. With
the assistance of NAMM as set forth in Section 2.8, ElmCare shall adopt and
monitor the implementation of quality assurance, risk management and utilization
review programs designed to monitor and evaluate the quality of Medical Services
provided by physicians and other providers and to evaluate the professional
skills of potential contracting providers (including, but not limited to,
determining whether each provider may provide services under Risk Contracts and
the scope and conditions of such services) prior to permitting such providers to
render services pursuant to Risk Contracts.
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8.3. Provider Agreements. ElmCare will have with each physician or
physician group with whom/which it contracts a provider agreement that shall
require, among other things, that:
(a) Each physician shall be licensed to practice medicine in the
State of Illinois without restriction on his/her license;
(b) Each physician shall maintain all state and federal licenses
to dispense controlled substances; and
(c) Each physician shall maintain in full force and effect
professional liability insurance with commercial carriers licensed to
provide insurance in the State of Illinois with policy limits of at
least $1,000,000 per occurrence and $3,000,000 in the aggregate.
8.4. Insurance. ElmCare shall, at its sole expense, obtain and maintain
with commercial carriers or in the form of self-insurance or some combination
thereof, appropriate workers' compensation coverage for ElmCare's employees, and
casualty and comprehensive general liability insurance covering ElmCare,
ElmCare's employees and ElmCare's property in such amounts, on such basis and
upon such terms and conditions as are reasonable in light of ElmCare's business.
ElmCare shall provide NAMM with certificates of such coverage annually, and
shall notify NAMM of any termination or change in such coverage.
ARTICLE 9.
REPRESENTATIONS AND WARRANTIES
As a condition to entry into this Agreement, each party represents and
warrants to the other party that the statements set forth in this Article 9 are
true and correct as of the Effective Date.
9.1. Authority to Enter into Agreements; Enforceability. Each party has
full corporate power and authority to enter into and to carry out the terms and
provisions of this Agreement, and the transactions contemplated hereby; all
corporate proceedings have been taken and all corporate authorizations have been
obtained by such party which are necessary to authorize the execution and
delivery of this Agreement and this Agreement is a legal, valid, and binding
obligation of such party enforceable in accordance with its terms.
9.2. Organization and Standing. Each party is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Illinois. Each party has all requisite corporate power and authority to own,
lease, and operate its properties and to carry on its business as it is now
being conducted.
9.3. Litigation. Except as otherwise disclosed in writing to the other
party, each party represents and warrants that there are no suits, actions, or
legal, administrative, arbitration or other proceedings or governmental
investigations pending, filed, or initiated by, or to the best of its knowledge,
threatened against or directly involving the party that may materially and
adversely affect the operations or financial status of such party or its ability
to perform hereunder.
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9.4. Compliance with Laws and Other Instruments. To the best of its
knowledge, the business and operations of each party have been and are being
conducted in accordance with all applicable laws, ordinances, and rules and
regulations of all authorities, the violation of which, individually or in the
aggregate, would materially and adversely affect the business or operations of
each party. Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will conflict with, result
in a violation or breach of any term or provision of, or constitute a default
under, the organizational documents of each party, or any statute, order,
judgment, writ, injunction, decree, license, permit, rule, or regulation of any
court or any governmental or regulatory body, or any indenture, mortgage, lease,
contract, agreement, instrument, commitment or other arrangement to which any
party is a party or by which it is or may be bound, which conflict, violation,
breach or default would materially and adversely affect the operations of the
party.
9.5. Material Misstatements or Omissions. No representation or warranty
by a party contained in this Agreement or in any certificate, schedule or
exhibit furnished to the other party under this Agreement contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements and facts contained therein not materially misleading.
ARTICLE 10.
EXCLUSIVITY
10.1. Exclusive Relationship with NAMM. While this Agreement is in
effect, ElmCare shall not contract with, or purchase the services of, any other
third party for the provision services similar to those provided by NAMM under
this Agreement without the prior written consent of NAMM, which consent may be
withheld by NAMM for any reason. Notwithstanding anything to the contrary,
ElmCare's employment of management and administrative personnel shall not
constitute or be deemed to constitute a violation of this Section 10.1.
10.2. Exclusive Relationship with ElmCare. While this Agreement is in
effect, NAMM shall not contract with, offer or provide services similar to those
provided hereunder to any third party within the Territory without the prior
written consent of ElmCare, which consent may be withheld by ElmCare for any
reason. Notwithstanding the preceding, in the event that ElmCare rejects or
decides not to enter into a Risk Contract with a third party payor and an
investor in ElmCare elects to pursue such Risk Contract with the third party
payor as permitted by the agreement between such investor and ElmCare, then NAMM
may provide to the investor in ElmCare with respect to such Risk Contract
services similar to those provided hereunder; provided, however, that the cost
of providing such services shall be charged to, and born entirely by, such
investor in ElmCare.
ARTICLE 11.
RELATIONSHIP OF THE PARTIES
The parties hereby acknowledge and agree that, in performing their
respective duties under this Agreement, they are at all times acting and
performing as independent contractors, and nothing in this Agreement is intended
or should be construed to create an employer/employee, partnership, joint
venture or other relationship. The employees of NAMM whose services are
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provided pursuant to this Agreement are employees of NAMM and are not in any way
considered to be employees of ElmCare. It is distinctly understood and agreed
that NAMM and its employees shall at all times be acting as independent
contractors and not as servants or employees of ElmCare. The employees of NAMM
are not covered by Workmen's Compensation insurance or unemployment insurance
carried by ElmCare, nor are the employees of NAMM entitled to participation or
receipt of any employee benefits of ElmCare, including but not limited to
health, life and disability insurance, pension, annuity benefits, educational
allowances, reimbursement for dues or licensing fees, paid time off and
professional liability insurance. NAMM agrees that it will carry and maintain
such insurance including but not limited to Workmen's Compensation and
unemployment insurance, as may be required by law, and, further, that it will
comply with all laws applicable to it and with all tax or any other requirements
of all governmental bodies with respect to any income or compensation,
withholding, F.I.C.A., or other requirement applicable to it as and if required
by law.
ARTICLE 12.
INDEMNIFICATION
12 1. Indemnification of ElmCare. NAMM shall indemnify and hold
ElmCare, its employees, agents, representatives, successors and assigns harmless
from and against (a) any damage or deficiency resulting from any
misrepresentation, breach of warranty or nonfulfillment of any agreement on the
part of NAMM under this Agreement, or from any misrepresentation or omission
from any certificate or other instrument furnished or to be furnished to ElmCare
in accordance with the provision of this Agreement; (b) any grossly negligent or
willful act or omission by NAMM or its employees, directors, officers, or
agents; and (c) all actions, suits, proceedings, demands, assessments, judgment,
costs and expenses, including reasonable attorney's fees and expenses, incident
to any of the foregoing.
12.2. Indemnification of NAMM. ElmCare shall indemnify and hold NAMM,
its employees, agents, representatives, successors and assigns harmless from and
against (a) any damage or deficiency resulting from any misrepresentation,
breach of warranty or nonfulfillment of any agreement on the part of ElmCare
under this Agreement, or from any misrepresentation or omission from any
certificate or other instrument furnished or to be furnished to NAMM in
accordance with the provision of this Agreement; (b) any grossly negligent or
willful act or omission by ElmCare or its employees, directors, officers, or
agents; and (c) all actions, suits, proceedings, demands, assessments, judgment,
costs and expenses, including reasonable attorney's fees and expenses, incident
to any of the foregoing.
12.3. Defense of Claims. In the event that any claim is asserted
against a party which it is entitled to indemnification hereunder (the
"Indemnified Party"), the Indemnified Party shall promptly after learning of
such claim notify the other party (the "Indemnifying Party") thereof in writing;
provided, however, that the failure of the Indemnified Party to give prompt
notice of such claim as aforesaid shall not relieve the obligation of the
Indemnifying Party with respect to such claim. The Indemnifying Party shall have
the right, by giving written notice to the Indemnified Party within ten (10)
calendar days after receipt from the Indemnified Party of notice of such claim,
to conduct at its expense the defense against such claim in its own name, or,
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if the Indemnifying Party shall fail to give such notice, it shall be deemed to
have elected not to conduct the defense of the subject claim, and in such event
the Indemnified Party shall have the right to conduct such defense and to
compromise and settle the claim without prior consent of the Indemnifying Party.
In the event that the Indemnifying Party elects to conduct the defense of the
subject claim, the Indemnified Party will cooperate with and make available to
the Indemnifying Party such assistance and materials as may be reasonably
requested by him, all at the expense of the Indemnifying Party, and the
Indemnified Party shall have the right at its expense to participate in the
defense, provided that the Indemnified Party shall have the right to compromise
and settle the claim only with the prior written consent of the Indemnifying
Party. No legal proceeding in which the Indemnified Party is named as a party
shall be settled by the Indemnifying Party without the Indemnified Party's prior
written consent unless such settlement or compromise (a) affects no substantive
rights of the Indemnified Party, (b) involves no admission of fault by the
Indemnified Party, and (c) creates no obligations or liabilities for the
Indemnified Party. Any judgment entered or settlement agreed upon in the manner
provided herein shall be binding upon the Indemnifying Party, and shall
conclusively be deemed to be an obligation with respect to which the Indemnified
Party is entitled to indemnification hereunder.
12.4. Survival. The terms and conditions of this Article 12 shall
survive termination of this Agreement.
ARTICLE 13.
CONFIDENTIALITY
13.1. Confidential Information. In connection with the NAMM's
performance under this Agreement, it is anticipated that NAMM and/or its
affiliates, representatives, agents or advisors (such individuals are referred
to herein as "Representatives") will be furnished with certain confidential and
proprietary information related to the business of ElmCare (herein collectively
referred to as "Confidential Information"). Confidential Information includes
not only written information but also information transferred orally, visually,
electronically or by any other means, together with the notes, analyses, or
studies, including all drafts, prepared by ElmCare or one of its Representatives
incorporating any nonpublic information that is provided to NAMM or its
Representatives. In consideration of furnishing the Confidential Information,
and as a condition to such disclosure, NAMM agrees to the following:
(a) Confidential Information will be used by NAMM and its
Representatives solely for the purpose of providing services to ElmCare
under this Agreement, and for no other purpose.
(b) NAMM and its Representatives will keep all Confidential
Information secret and strictly confidential and will not disclose it
to anyone, except to a limited group of employees and directors who are
actually engaged in performing services under this Agreement. NAMM
agrees also to disclose Confidential Information only to such
Representatives on a need-to-know basis. Each person to whom such
Confidential Information is disclosed must be advised of the terms of
this Agreement and must agree to abide by such terms by executing a
written statement of confidentiality, a copy of which shall be provided
to ElmCare.
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13.2. Exceptions. Confidential Information does not include: (a)
information which is in the public domain or enters the public domain through no
fault of NAMM; (b) information known by NAMM prior to commencement of the
discussions between NAMM and ElmCare that resulted in this Agreement; (c)
information rightfully disclosed to NAMM by a third party (other than ElmCare)
without continuing restrictions on its use; or (d) disclosure of information as
may be required by law, provided that NAMM provides ElmCare a reasonable
opportunity to intervene to obtain a protective order to, or to otherwise
lawfully, prevent such disclosure from being required.
13.3. Survival. The terms and conditions of this Article 13 shall
survive termination of this Agreement.
ARTICLE 14.
DISPUTE RESOLUTION
Any dispute arising out of or in connection with this Agreement,
including a claimed breach of the terms hereof, shall be resolved by arbitration
conducted in the Chicago metropolitan area by the American Arbitration
Association in accordance with its rules then in existence. The arbitrators
shall not contravene or vary in any respect any of the terms or provisions of
this Agreement. The award of the arbitrators shall not be binding, but may be
appealed by either party to a court of proper jurisdiction, but no sooner than
one hundred twenty (120) days following the arbitrator's award.
ARTICLE 15.
NON-SOLICITATION OF EMPLOYEES
While this Agreement is in effect, neither party shall solicit or hire
any employee of the other party.
ARTICLE 16.
MISCELLANEOUS
16.1. Expenses. Each party agrees to pay its own expenses incurred in
connection with the negotiation and execution of this Agreement.
16.2. Notice. All notices, requests, demands and other communications
required or permitted to be given hereunder shall be sent by (a) certified mail,
return receipt requested or (b) by facsimile to the parties or (c) commercial
carrier that provides a signed receipt verifying actual delivery at the
addresses set forth below. Such notices shall be deemed given seven (7) business
days after being deposited in the United States mail or when receipt
acknowledged, if sent by facsimile:
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If to ElmCare: ElmCare, L.L.C.
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Executive Director
Facsimile: (000) 000-0000
If to NAMM: North American Medical Management - Illinois, Inc.
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxx 00000
Attn: President
Facsimile: (000) 000-0000
or to such other addresses as the parties may specify in writing.
16.3. Waiver of Terms. Any of the terms or conditions of this Agreement
may be waived at any time by the party that is entitled to the benefit thereof,
but only by a written notice signed by the party waiving such terms or
conditions. The waiver of any term or condition shall not be construed as a
waiver of any other term or condition of this Agreement.
16.4. Amendment of Agreement. This Agreement may be amended,
supplemented or modified at any time, but only by a written instrument duly
executed by both ElmCare and NAMM. Such amendments shall be effective as of the
date specified therein.
16.5. Governing Law. This Agreement shall be construed, and the rights
and liabilities of the parties hereto determined, in accordance with the
internal laws of the State of Illinois; provided, however, that the conflicts of
law principles of the State of Illinois shall not apply to the extent that they
would operate to apply the laws of another state.
16.6. Partial Invalidity. In case any one or more of the provisions
contained herein shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision or
provisions had never been contained herein.
16.7. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and the successors and permitted
assigns of ElmCare and NAMM; provided, however, that except as expressly
permitted under the terms hereof, none of the rights or obligations of the
parties hereunder may be assigned without the prior written consent of the other
party.
16.8. Titles and Headings. Titles and headings to sections herein are
for purposes of reference only, and shall in no way limit, define, or otherwise
affect the provisions herein.
16.9. Entire Agreement. This Agreement, including any appendices,
schedules or other exhibits presently or subsequently attached hereto,
constitutes the entire agreement between the
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Parties with respect to the subject matter hereof, and supersedes all prior
agreements, whether written or oral, between the parties with respect to the
subject matter hereto.
16.10. No Third Party Rights. The parties agree that it is their
specific intention to create no third party rights by virtue of this Agreement.
16.11. Approvals. Except as otherwise expressly provided herein,
whenever the consent or approval of either party is required by the terms of
this Agreement, such consent shall not be unreasonably withheld or delayed.
16.12. Cost of Legal Action. In the event any party to this Agreement
takes legal action to enforce any of the terms of this Agreement, including
arbitration as set forth above, the prevailing party to such action shall be
entitled to reimbursement for such party's reasonable expenses, including but
not limited to reasonable attorneys' fees, incurred in such action.
16.13. Force Majeure. Neither party shall be liable or deemed to be in
default for any delay or failure in performance under this Agreement or for any
interruption of service resulting from acts of God, civil or military authority,
acts of public enemy, war, accidents, fires, explosions, earthquakes,
hurricanes, tornadoes, floods, failure of transportation, strikes or other work
interruptions by either party's employees, or by any other similar cause beyond
the reasonable control of either party.
16.14. References to Time. All references to days in this Agreement
shall be references to calendar days, unless expressly stated otherwise.
16.15. Photocopies are Originals. Any photocopy or photostatic
reproduction of a fully-executed version of this Agreement shall constitute an
original hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to
be effective as of the date first written above.
ELMHURST PHYSICIAN HOSPITAL NORTH AMERICAN MEDICAL
ORGANIZATION, L.L.C. MANAGEMENT - ILLINOIS, INC.
/s/ Xxxxxx X. Xxxxxx /s/
---------------------------------------- -----------------------------------
Its: Executive Director Its: President
--------------------------------- ----------------------------
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