TALBERT MEDICAL MANAGEMENT HOLDINGS CORPORATION
                            1996 STOCK INCENTIVE PLAN

                                ELIGIBLE DIRECTOR
                       NONQUALIFIED STOCK OPTION AGREEMENT

          THIS AGREEMENT dated as of the 21st day of November, 1996, between
TALBERT MEDICAL MANAGEMENT HOLDINGS CORPORATION, a Delaware corporation (the
"Corporation"), and ___________________________ (the "Director").

                               W I T N E S S E T H

          WHEREAS, the Corporation has adopted and the stockholders of the
Corporation have approved the Talbert Medical Management Holdings Corporation
1996 Stock Incentive Plan (the "Plan").

          WHEREAS, pursuant to Article 7 of the Plan, the Corporation has
granted an option (the "Option") to the Director upon the terms and conditions
evidenced hereby, as required by the Plan, which Option is not intended as and
shall not be deemed to be an incentive stock option within the meaning of
Section 422 of the Code.

          NOW, THEREFORE, in consideration of the services rendered and to be
rendered by the Director, the Corporation and the Director agree to the terms
and conditions set forth herein as required by the terms of the Plan.

          1.   OPTION GRANT.  This Agreement evidences the grant to the
Director, as of September 17, 1996 (the "Award Date"), of an Option to purchase
an aggregate of ______ shares of Common Stock, par value $.01 per share, under
Article 7 of the Plan, subject to the terms and conditions and to adjustment as
set forth herein or pursuant to the Plan.

          2.   EXERCISE PRICE.  The Option entitles the Director to purchase
(subject to the terms of Sections 3 through 6 below) all or any part of the
Option shares at a price per share of $29.17, which amount represents the Fair
Market Value of the shares on the Award Date.

          3.   OPTION EXERCISABILITY AND TERM.  Subject to adjustment pursuant
to Section 7.6 of the Plan, the Option shall become and remain exercisable:  (i)
at the rate of 25% on the later of 90 days after the Award Date or 60 days after
the date of commencement of trading of the Common Stock on a national securities
exchange or quotation system (the "Initial Award Date") and (ii) at the rate of
25% per annum commencing on the first anniversary of the Initial Award Date and
each of the next two anniversaries thereof.  The Option shall terminate on
September 16, 2006 unless earlier terminated in accordance with the terms of
Section 7.7 of the Plan.





          4.   SERVICE AND EFFECT OF TERMINATION OF SERVICE.  The Director
agrees to serve as a director in accordance with the provisions of the
Corporation's Articles of Incorporation, bylaws and applicable law.  If the
Director's services as a member of the Board shall terminate, this Option shall
terminate at the times and to the extent set forth in Section 7.5 of the Plan.

          5.   GENERAL TERMS.  The Option and this Agreement are subject to, and
the Corporation and the Director agree to be bound by, the provisions of the
Plan that apply to the Option.  Such provisions are incorporated herein by this
reference.  The Director acknowledges receiving a copy of the Plan and reading
its applicable provisions.  Capitalized terms not otherwise defined herein shall
have the meaning assigned to such terms in the Plan.

          6.   GRANT CONDITIONED UPON LISTING OF SHARES.  Notwithstanding
anything else contained herein to the contrary, this Option is expressly
conditioned upon the commencement of trading of the shares of the Corporation's
Common Stock on a national securities exchange or quotation system.  In the
event that the Corporation's Common Stock does not commence trading on a
national securities or quotation system exchange within twelve (12) months from
the Award Date, this Option shall be null and void.

          7.   NONTRANSFERABILITY.  The Option and any other rights of the
Director under this Agreement or the Plan are nontransferable as provided in
Section 1.8 of the Plan.

          IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

                              TALBERT MEDICAL MANAGEMENT
                              HOLDINGS CORPORATION
                              (a Delaware corporation)

                              By:  ________________________________
                              Title: President and Chief Executive Officer

                              DIRECTOR

                              ____________________________________
                              (Signature)
                              ____________________________________
                              (Print Name)
                              ____________________________________
                              (Address)





                              ____________________________________
                              (City, State, Zip Code)

                                CONSENT OF SPOUSE

          In consideration of the execution of the foregoing Stock Option
Agreement by Talbert Medical Management Holdings Corporation, I,
_____________________________, the spouse of the Director therein named, do
hereby agree to be bound by all of the terms and provisions thereof and of the
Plan.

DATED:  ______________________, 1997.


                              ____________________________________
                              Signature of Spouse