SUBCONTRACTING AGREEMENT
Exhibit 99.8
This SUBCONTRACTING AGREEMENT (this “Agreement”), made this 31st day of August
2005, by and between Accordis Inc., a New York corporation (“Accordis”), and Reimbursement Services
Group Inc. (“RSG”), a New York corporation.
WHEREAS, HMS Holdings Corp., a New York corporation (“Holdings”) and the parent of RSG, and
Accordis Holding Corp., a New York corporation (“Accordis Holding”), have entered into a Stock
Purchase Agreement, dated August 31, 2005 (the “Stock Purchase Agreement”), pursuant to which
Accordis Holding has acquired on the date hereof, by the purchase of the outstanding capital stock
of Accordis from Holdings, the EMS Business and the Business Office Business of Accordis (as
defined in the Stock Purchase Agreement); and
WHEREAS, in connection with the transactions contemplated by the Stock Purchase Agreement, the
assets and obligations associated with the Reimbursement Business of Accordis (as defined in the
Stock Purchase Agreement) were distributed to Holdings and, in turn, to RSG; and
WHEREAS, Accordis is a party to certain contracts (the “Accordis Joint Contracts”) more
particularly described on Exhibit A to perform services for third parties that involve (i)
services of the Business Office Business (the “Business Office Services”) and (ii) the
Reimbursement Business (the “Reimbursement Services”), all as more particularly described on
Exhibit B and, in order to perform its obligations under the Accordis Joint Contracts,
Accordis desires to enter into a subcontracting arrangement with RSG and RSG desires to provide, as
subcontractor for Accordis, services related to the Reimbursement Business in connection with the
Accordis Joint Contracts; and
WHEREAS, RSG is a party to certain contracts (the “RSG Joint Contracts”) more particularly
described on Exhibit C to perform services for third parties that involve services of
Accordis and, in order to perform its obligations under the RSG Joint Contracts, RSG desires to
enter into a subcontracting arrangement with Accordis and Accordis desires to provide, as
subcontractor for RSG, Business Office Services in connection with the RSG Joint Contracts;
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth herein,
and for such other consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Appointment of Subcontractors. Accordis hereby appoints RSG to act as its
subcontractor under the Accordis Joint Contracts, and, in such capacity, to perform the obligations
of Accordis to provide the Reimbursement Services under and pursuant to the Accordis Joint
Contracts, as more fully described therein. RSG hereby acknowledges and accepts such appointment,
upon the terms set forth herein, and agrees to provide the Reimbursement Services as outlined in
this Agreement. Accordis and RSG each certify and affirm to the other that each will comply,
throughout the term of this Agreement, with all of the terms and conditions of each specified
Accordis Joint Contract, and any applicable law or
regulation, and other terms and conditions that may be in effect from time to time, each of which
is incorporated herein by reference and shall be considered part of this Agreement.
RSG hereby appoints Accordis to act as its subcontractor under the RSG Joint Contracts, and,
in such capacity, to perform the obligations of RSG to provide the Business Office services under
and pursuant to the RSG Joint Contracts, as more fully described therein. Accordis hereby
acknowledges and accepts such appointment, upon the terms set forth herein, and agrees to provide
the Business Office Services as outlined in this Agreement. Accordis and RSG each certify and
affirm to the other that each will comply, throughout the term of this Agreement, with all of the
terms and conditions of each specified RSG Joint Contract, and any applicable law or regulation,
and other terms and conditions that may be in effect from time to time, each of which is
incorporated herein by reference and shall be considered part of this Agreement.
Accordis and RSG each agree to cooperate with the other party in all ways reasonably necessary
to permit the other party to perform its obligations under the Accordis Joint Contracts and RSG
Joint Contracts and hereunder, including, without limitation, promptly forwarding to the other
party copies of all communications received from third parties to the Accordis Joint Contracts and
RSG Joint Contracts or other persons relating to such contracts, promptly answering any requests
submitted by the other party and rendering decisions regarding any approvals requested by the other
party.
2. Scope of Services and Costs — RSG. In connection with this Agreement, RSG will
provide the Reimbursement Services under the Accordis Joint Contracts and RSG Joint Contracts and
is and will be solely responsible for all associated costs, including but not limited to (i) timely
performance of the scope of the Reimbursement Services and (ii) invoice generation to the
applicable third party to the Accordis Joint Contracts or the RSG Joint Contracts for payment of
services rendered.
3. Scope of Services and Costs — Accordis. In connection with this Agreement, Accordis
will provide the Business Office Services under the Accordis Joint Contracts and RSG Joint
Contracts and will be responsible for the associated costs, including but not limited to (i) timely
performance of the scope of the Business Office Services and (ii) invoice generation to the
applicable third party to the Accordis Joint Contracts or the RSG Joint Contracts for payment of
services rendered.
4. Payments. Accordis shall xxxx the third parties to the Accordis Joint Contracts
and the RSG Joint Contracts for the Business Office Services, and RSG shall xxxx the third parties
to the RSG Joint Contracts and the Accordis Joint Contracts for the Reimbursement Services.
Accordis and RSG shall each be responsible for the collection of the xxxxxxxx for the services
rendered by it and shall not have any obligation or liability with respect to the xxxxxxxx for
services of the other party, except that each party shall promptly remit to the other all payments
received with respect to the invoices of the other party.
5. Performance. Until such time as this Agreement shall be terminated in accordance
with the terms hereof, each of Accordis and RSG shall (i) perform the services
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required of it under the Accordis Joint Contracts and RSG Joint Contracts, as applicable, in a
workmanlike manner, in compliance with all of the terms and conditions of such contracts and this
Agreement applicable to such performance and render such performance in a manner reasonably
satisfactory to the third parties to the Accordis Joint Contracts and RSG Joint Contracts and (ii)
devote or shall cause its employees, affiliates or subcontractors to devote such time and activity
during business days and hours as is reasonably necessary for the proper performance of such
services. It is the intention of the parties hereto that RSG shall provide the Reimbursement
Services under the Accordis Joint Contracts as an independent contractor and not as a partner,
affiliate or employee of Accordis. It is the intention of the parties hereto that Accordis shall
provide the Business Office Services under the RSG Joint Contracts as an independent contractor and
not as a partner, affiliate or employee of Accordis. Accordis will act as the prime contractor
under the Accordis Joint Contracts and RSG will act as the prime contractor under the RSG Joint
Contracts, and neither party will be relieved from any obligation, provision or liability under
such the Accordis Joint Contracts or the RSG Joint Contracts, as applicable.
6. Term. This Agreement shall become effective on the date hereof and shall continue
until the earlier of (i) the expiration, assignment or other termination of all of the Accordis
Joint Contracts and RSG Joint Contracts, and (ii) the date that this Agreement, including any
amendments, renewals or extensions thereof, is terminated .
7. Indemnity. Each of Accordis and RSG (each an “Indemnifying Party”) hereby agrees
to indemnify, defend and hold the other (the “Indemnified Party”) harmless from and against all
claims (other than fraud) made by any third party against the Indemnified Party by reason of or
resulting from the Indemnifying Party’s failure to fulfill its obligations under this Agreement or
under the terms of the Accordis Joint Contracts and RSG Joint Contracts applicable to the
Indemnifying Party.
8. Warranties.
(a) Capacity to Contract. Accordis and RSG each represent and warrant to the other party that
it (i) has read the Accordis Joint Contracts and RSG Joint Contracts and all documents incorporated
therein, (ii) has the capacity to enter into this Agreement, and (iii) in entering this Agreement
will not violate any other agreement to which it may be bound for the performance of the
Reimbursement Services or the Business Office Services, as the case may be, under the Accordis
Joint Contracts, the RSG Joint Contracts or this Agreement.
(b) Standard of Conduct. Accordis and RSG each represent and warrant to the other party that
it shall be in full compliance with all applicable laws, rules, regulations and standards of
ethical conduct, now or hereafter in effect, and it shall indemnify, defend, and hold the other
party harmless of any damages caused by its violation of this provision. Each of Accordis and RSG
will be solely responsible for cognizance of and timely adherence to all applicable reporting and
disclosure requirements arising out of its services to be performed pursuant to the Accordis Joint
Contracts, RSG Joint Contracts and this Agreement, provided that neither party is responsible for,
or assuming, any legal compliance or reporting obligations imposed on the other party by applicable
law.
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(c) Special Certification. Accordis and RSG each represent and warrant to the other party
that neither it nor any of its affiliates is presently debarred, suspended, proposed for debarment,
declared ineligible, or voluntarily excluded from participation in transactions by the United
States Department of Health and Human Services or any other Federal or State department or agency.
9. Termination.
(a) Termination for Insolvency or Bankruptcy. Either party may immediately terminate this
Agreement by giving written notice to the other party in the event of (i) the liquidation or
insolvency of the other party, (ii) the appointment of a receiver or similar officer for the other
party, (iii) an assignment by the other party for the benefit of all or substantially all of its
creditors, (iv) entry by the other party into an agreement for the composition, extension, or
readjustment of all or substantially all of its obligations, or (v) the filing of a meritorious
petition in bankruptcy by or against the other party under any bankruptcy or debtors’ law for its
relief or reorganization.
(b) Termination for Cause. In the event that either party is in default in the performance of
any of its duties or obligations set forth in this Agreement, and such default is not substantially
cured within sixty (60) days (or five (5) days, in the case of any failure to promptly remit
payments received with respect to the invoices of the other party) after written notice is given to
the defaulting party specifying the default, then the party not in default may, by giving written
notice thereof to the defaulting party, terminate the Agreement as of a date specified in such
notice of termination.
(c) Termination of Contract(s). In the event any of the Accordis Joint Contracts or RSG
Joint Contracts are terminated, the party receiving notice of such termination shall promptly give
written notice thereof to the other party hereto and the services related to such terminated
contract shall cease to be a part of this Agreement.
10. Modifications. Any modifications, amendments, supplements to or waivers of or
under this Agreement, or to any covenant, conditions, or limitations contained herein, are valid
only if in writing. Such modifications must be duly executed by both parties.
11. Non-Disclosure of Confidential Information. During the term of this Agreement,
each party (the “Receiving Party”) will receive, and have access to, confidential and proprietary
information of the other party (the “Disclosing Party”). Each Receiving Party shall keep
confidential, and cause their affiliates and instruct their officers, directors, employees and
advisors to keep confidential, all information relating to the Disclosing Party and its businesses,
except as required by law or administrative process and except for information that is available to
the public on the date hereof, or thereafter becomes available to the public other than as a result
of a breach of this Section 11. The covenant in this Section 11 shall continue in full force and
effect following the execution and delivery of this Agreement until the fifth anniversary of the
date hereof.
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12. Non-Solicitation. During the period beginning on the date hereof and ending on
the fifth anniversary of the date hereof (the “Non-Solicitation Term”), neither party shall solicit
for employment any employee of the other, or advise or recommend that any such employee leave his
or her employment; and RSG agrees not to offer, and have not offered, any person employed by
Accordis in the conduct of the Business Office Services any inducement outside of the ordinary
course of such person’s employment with Accordis that could reasonably be expected to influence
such person’s decision to remain with the Business Office Services. During the Non-Solicitation
Term, RSG shall not employ after the closing under the Stock Purchase Agreement any person engaged
in the operations of the Business Office Services as of or following the date hereof, except that
RSG may employ any person terminated by Accordis after the closing of the transactions contemplated
hereby with the prior written consent of Accordis Holding, such consent not to be unreasonably
withheld, conditioned or delayed.
13. Not An Exclusive Relationship. This agreement is not intended to be an exclusive
agreement for either party. Accordingly, there is no exclusive relationship between Accordis and
RSG, either express or implied, that would limit the activities of either party or restrict either
party from entering agreements with other entities for business engagements or from pursuing the
same on their own, other than the Accordis Joint Contracts and the RSG Joint Contracts.
14. Waiver. A failure by either party to exercise any right provided for herein or by
the applicable law will not be deemed a waiver of any right hereunder. The remedies provided
herein will be cumulative and will not be exclusive of any rights or remedies provided under law.
15. Successors and Assigns. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by, the respective successors and assigns of the parties hereto;
provided, however, that the obligations of Accordis hereunder may not be assigned without the
written consent of Holdings; and further provided that RSG may not assign this agreement except in
accordance with Section 8.12 of the Stock Purchase Agreement.
16. Severability. Each provision of this Agreement is severable. If any provision or
term hereof is determined, for any reason whatsoever, to be illegal or otherwise unenforceable, (i)
such provision shall be reformed and constructed in such a manner as to fulfill the intent of the
parties hereto to the greatest possible extent and (ii) such determination shall not affect the
validity of the remaining provisions and terms of this Agreement.
17. Entire Agreement. This Agreement constitutes the entire agreement of the parties
hereto with respect to the subject matter hereof and may not be modified or amended except in
writing signed by the parties hereto. All exhibits, documents, and schedules referenced in this
Agreement or attached to this Agreement are integral parts of this Agreement. In the event of any
conflict between the terms and conditions of this Agreement and any such exhibits, documents, or
schedules, the terms of this Agreement will be controlling unless otherwise stated.
18. Governing Law. Except to the extent that the terms hereof require interpretation
of the provisions of the Accordis Joint Contracts and RSG Joint Contracts, in
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which case the laws governing such contracts shall govern, this Agreement shall be construed in
accordance with and governed by the laws of the State of New York without regard to the conflicts
of law rules thereof.
19. Counterparts. This Agreement may be signed in two or more counterparts, each of
which shall be an original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or caused this Agreement
to be executed by their respective authorized officers, as of the day first above written.
| ACCORDIS INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| REIMBURSEMENT SERVICES GROUP, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
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EXHIBIT A
Accordis Joint Contracts
Los Angeles Department of Health Services
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EXHIBIT B
The Business Office Services
Accordis delivers business office services to public and private hospitals and clinics
nationwide. The company offers a combination of proprietary technology, expertise in patient
accounting, and knowledge of federal, state, and local healthcare claiming regulations.
Accordis’s services help hospitals increase revenue, accelerate cash, and reduce operating
costs.
The company’s services include all or a portion of patient accounting activities that make
up a healthcare provider’s revenue cycle. Such activities may include Medicaid application
assistance, third-party resource identification and validation, submission of bills to
primary and secondary payers, generation of patient statements, response to patient and
third-party payer questions, recovery of payments due, and proper accounting for payments,
contractual allowances and write-offs. Accordis owns and operates AccessLine, a proprietary
on-line account liquidation system that enables the company to consolidate account
information for patients, enhance account data obtained from clients through electronic
links to external databases, organize account information in a manner that facilitates
processing and recovery activities, generate claims to payers, and drive service center work
events. Accordis supports these activities through service centers located in Chicago, Los
Angeles and Ft. Lauderdale.
The Reimbursement Services
Medicare Bad Debt Service Description:
Through its Medicare Bad Debt Claiming Services, Reimbursement Services Group Inc. (“RSG”)
completes the documentation required to sustain the Medicare Bad Debt claim to the Client’s
Medicare intermediary for reimbursement. RSG performs these services for designated
Medicare fiscal reporting periods, as contractually specified. The services include the
following: (i) collection and storage of Client’s patient accounting and Medicare
remittance data for Client facilities; (ii) preparation of claims for cost report filings,
reopenings, or appeals, as appropriate; (iii) support for Medicare audits in which reports
produced by RSG are reviewed; (iv) reports showing performance on the Client’s Medicare
secondary accounts receivable, including assessment of the impact of collection practices,
line item report on findings and recommendations for improvement on future liquidations.
Medicare Disproportionate Share Service Description:
Through its Medicare Disproportionate Share Claiming Services, RSG completes the
documentation required to substantiate reimbursement by Medicare through
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disproportionate share hospital adjustments. RSG performs these services for designated
Medicare fiscal reporting periods, as contractually specified. The services include: (i)
collection and storage of Client’s patient accounting and Medicaid remittance data for
Client facilities; (ii) validation of Medicaid eligibility for all inpatient accounts, and
performance of special analysis and research as
required; (iii) preparation of claims for cost report filings, reopenings, or appeals, as
appropriate; (iv) support for Medicare audits in which reports produced by RSG are reviewed.
End Stage Renal Disease Claiming Service Description:
Through its End Stage Renal Dialysis (ESRD) Claiming Services, RSG completes the
documentation required to sustain the Medicare add-on reimbursement for ESRD via the annual
cost report. RSG performs these services for designated Medicare fiscal reporting periods,
as contractually specified. The service includes: (i) analysis and claim preparation,
through review of client and governmental data files; (ii) preparation of claims for cost
report filings, reopenings, or appeals, as appropriate; (iii) support for Medicare audits in
which reports produced by RSG are reviewed.
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EXHIBIT C
The RSG Joint Contracts
Bon Secours Health System
Allina Health Systems
University of Pennsylvania Health Systems
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