ANESTHESIOLOGY AGREEMENT
(RE: MEDICAL ADMINISTRATIVE AND PROFESSIONAL SERVICES)
THIS AGREEMENT, effective as of the first day of January, 1997, at
12:01 a.m., by and between SOUTH BROWARD HOSPITAL DISTRICT, a Florida special
taxing district (hereinafter referred to as "Hospital District"), and Sheridan
Healthcorp, Inc., a Florida Corporation (hereinafter referred to as "Sheridan").
R E C I T A L S:
The following recitals serve as a preamble to show the facts and
circumstances which have induced the parties to enter into this Agreement are
stated and set forth as follows:
(1) The powers and duties of South Broward Hospital District are
derived from the general laws of the state of Florida and from Ch. 24415, Laws
of Fla.(1947), as amended. Ch.24415, Laws of Fla. (1947), as amended, represents
the "Charter" of the Hospital District.
(2) Under the provisions of Ch. 165.031, Fla. Stat., the Hospital
District is also deemed to be a unit of local government.
(3) Under its Charter, the Hospital District has the power, among
others, to establish, construct, acquire, operate and maintain hospitals or
facilities for limited or extended care and treatment and any facilities which
are necessary and incidental to the operation thereof.
(4) Since 1953, the main hospital facility owned and operated by the
Hospital District has been Memorial Regional Hospital, a licensed 680 bed public
hospital facility located at 3501 Johnson Street, Hollywood, Florida. However,
the Hospital District does own and operate other health care facilities of a
lesser size at various locations within the jurisdictional limits of the
Hospital District. Further, the Hospital District owns and operates a 100 bed
public hospital known as Memorial Hospital West, in Pembroke Pines, Florida.
Hospital District operates, pursuant to a lease agreement, a 301 bed public
Hospital, known as Memorial Hospital Pembroke, also located in Pembroke Pines,
Florida. The term "The Hospital" as used herein means Memorial Regional
Hospital, Memorial Hospital West, Memorial Hospital Pembroke, collectively and
individually.
(5) Hospital District conducts its operations in accord with certain
rules, procedures, standard practices, and policies, which include, without
limitation, the charter, bylaws, standard practice rules and regulations of the
Hospital District, the bylaws and rules and regulations of the Hospital
District's medical staffs, the rules and regulations of the operational
departments of Hospital District, and other policies, practices and procedures
of the Hospital District, all as adopted and approved in the routine course of
the business of the Hospital District. Such rules, procedures, standard
practices and policies are hereinafter referred to as "Hospital District
Policies."
(6) Generally, Hospital District acts with respect to all matters
hereunder through its Chief Executive Officer, who is the executive exercising
overall authority with respect to the day-to-day operation and management of the
Hospital District. This authority may be delegated to the persons holding the
title of "Administrator" of each of the various hospitals of Hospital District,
or their designees.
(7) The name Memorial Regional Hospital is used as a fictitious name.
The names Memorial Regional Hospital, Memorial Hospital West, and Memorial
Hospital Pembroke have been registered by the Hospital District under the
provisions of the Fictitious Name Statute (Ch. 865.09, Fla. Stat.) with the
Division of Corporations of the Department of State, of the State of Florida.
South Broward Hospital District is the sole entity which has any interest in
operating the hospital enterprises known as Memorial Regional Hospital, Memorial
Hospital West, and Memorial Hospital Pembroke.
(8) Specifically, Hospital District requires the providing of
"Anesthesiologist Services," which term means physician services, as defined by
State law and Hospital District Policies (including, without limitation, Medical
Staff By-laws) relating to the administration of anesthesia, including, without
limitation:
(i) conducting a pre-anesthesiology evaluation, including,
without limitation, interviewing of patients, reviewing histories and making
appropriate physical examinations to determine the method of administering
anesthesia.
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(ii) providing anesthesia "standby" services to patients
and/or performing and/or directing administration of general, regional,
epidural, local, or nerve block anesthesia to patients, including, without
limitation, supervision and/or providing instructions to Non-Physician Personnel
or other assistants for the following types of surgery and/or procedures,
including, without limitation: Ear, Nose and Throat; Head and Neck, Vascular,
Open Heart, Thoracic, General Surgery, Orthopedic, Genito-Urinary,
Gynecological, Obstetrical, Neuroanesthesia, Eye Surgery, Oral Surgery, Plastic
Surgery, Pediatric, Electroconvulsive Therapy, Nerve blocks for Diagnosis or
Procedures for Control of Pain.
(iii) providing post anesthesia care, including, without
limitation, performing cardiopulmonary resuscitation of patients undergoing
surgery, or under anesthesia in emergency situations.
(iv) providing post operative pain relief.
(v) initiation, administration, supervision, and follow up
of patient controlled analgesia (P.C.A); and,
(vi) providing anesthesia management for delivery of out-
patient pain services.
It is understood and agreed that the specific Anesthesiologist Services
itemized in this section may be subject to change, during the term, based on the
changes in the standard of care governing the practice of Anesthesiology, and
based on changes within the scope of medical practice by Anesthesiologists. Any
such change shall be subject to the approval of Hospital District.
(9) The physicians providing the above referenced Anesthesiologist
Services pursuant to this Agreement are hereinafter referred to as
"Anesthesiologists." For purposes of this Agreement, the term "Anesthesiologist"
means a physician employed or otherwise retained by Sheridan to furnish
Anesthesiologist Services to patients; and to furnish other services to the
Hospital District pursuant to this Agreement, each of whom must, as a continuing
precedent of Hospital District's obligations hereunder:
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(i) hold a valid and unlimited license to practice medicine
in the State;
(ii) be either board eligible or board certified in a
recognized branch of Anesthesiology;
(iii) obtain and maintain appropriate membership in Hospital
District's Medical Staffs, with appropriate privileges necessary to provide
Anesthesiologist Services at the Hospital;
(iv) have formal training and experience in Anesthesiology;
(v) have skill in procedures and knowledge required in the
care of patients requiring Anesthesiologist Services; and
(vi) be approved by the Chief Executive Officer prior to
performing Anesthesiologist Services at the Hospital, in accordance with
existing Hospital and Medical Staff Bylaws, Rules and Regulations.
(vii) be fluent in the English language.
(10) Sheridan may retain the services of CRNAs, which term means
Certified Registered Nurse Anesthetists as defined by ss.464.012, Fla. Stat., to
assist Anesthesiologists in the performance of their duties under this
Agreement.
Each CRNA retained by Sheridan hereunder, shall perform services
hereunder within the framework of protocols established by an Anesthesiologist,
and shall, at all times be under the general direction and control of an
Anesthesiologist, who shall supervise and direct the specific course of medical
treatment.
All appointments of all CRNA's retained by Sheridan to perform services
under this Agreement must be approved by the Hospital District prior to such
appointment and all Sheridan's CRNA's must maintain the continuing approval of
the Hospital District.
Sheridan shall at all times be responsible for ensuring the
qualifications of its CRNA's and shall ensure that an Anesthesiologist shall
supervise, at all times, Sheridan's CRNA's while they are providing services to
patients.
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In each case involving the services of Sheridan's CRNA's, at least one
Anesthesiologist shall:
A. Monitor the course of anesthesia administration at frequent
intervals;
B. Remain physically present and available in the Surgical Suite,
for immediate diagnosis and treatment of emergencies (for purposes of this
Section, the term "Surgical Suite" shall mean the Hospital's Operating Rooms,
Recovery Rooms, and the Labor and Delivery Complex);
C. Direct no greater number of concurrent anesthesia procedures
than is permitted by Medicare regulations for reimbursement purposes;
D. Not perform any other services, including, without limitation
providing Anesthesiologist Services to other patients, while directing the
concurrent procedures under subsection (C) above.
(11) The proper operation of the Hospital, and the rendition of
Anesthesiologist Services at the Hospital, requires the performance of certain
duties which are medical administrative in nature by Anesthesiologists
designated as Medical Directors. The Medical Directors shall be Board Certified
in Anesthesiology, and be active in attending seminars and courses concerning
Anesthesiology and related medicine. The general responsibilities of the Medical
Director shall include, without limitation, the following:
(a) assumption and discharge of responsibility for medical direction
of the Anesthesiologist Services under Hospital District Policies;
(b) advising Hospital District, from a physician's perspective, and
within the scope of a physician's background and training, about the use,
availability, and selection of additional and replacement of anesthesia
equipment for Hospital. Sheridan shall assist Hospital District in evaluating,
from a physician's perspective, and within the scope of a physician's background
and training, medical equipment used in the rendition of anesthesia in the
Hospital.
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(c) serving as the official liaison for the Anesthesiologists with
the Administrator and Hospital District's Medical Staff;
(d) assisting in the inservice education of Hospital Personnel in
matters that affect the provision of anesthesia in the Hospital
(e) preparing and implementing a schedule of Anesthesiologist
coverage for the Hospital, in accord with the terms of this Agreement, and to
meet the staffing requirements required by the patient load;
(f) reviewing and responding appropriately to all questions
regarding the practice of medicine by Anesthesiologists posed by the
Administrator or Hospital District's Medical Staff;
(g evaluating on a regular basis the performance of each
Anesthesiologist;
(h) ensuring that all medical reports by Anesthesiologists are
complete and scrutinized for quality;
(i) developing and implementing a program of audit, peer review,
and continuing education for all Anesthesiologists with the concurrence of
Hospital District's Medical Staff and the Administrator;
(j) participating in establishment of procedures to improve the
quality of all services provided by Anesthesiologists and Hospital personnel
providing technical assistance to Anesthesiologists, and the cost effective
utilization of Hospital resources in connection with same; and additionally
participating in the Hospital's overall Quality Improvement Program in
accordance with Hospital District Policies and the policies of accrediting
organizations.
(k) ensuring the prompt preparation and filing, in accord with
Hospital District Policies, of reports of all examinations, procedures,
consultations, and other Anesthesiologist Services performed in the Hospital.
(l) participating in the educational programs conducted by Hospital
District or Medical Staff necessary to assure the Hospital District's overall
compliance with accrediting requirements and shall perform such other reasonable
teaching functions within the Hospital as Hospital District may request.
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The above services are hereinafter referred to as "Medical Administrative
Services."
(12) Sheridan is willing to retain and to provide to Hospital
District an Anesthesiologist to assume the position of Anesthesiology Medical
Director to perform Medical Administrative Services, and to retain and to
provide to Hospital District other Anesthesiologists to perform Anesthesiologist
Services and to retain and provide to Hospital District CRNA's under the
terms and conditions set forth below in this Agreement.
In consideration of the mutual promises contained below, the parties
herein agree as follows:
I. INCORPORATION OF RECITALS:
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The above Recitals are hereby accepted by the parties as true and
incorporated herein.
II. APPOINTMENT:
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2.1 Exclusivity. Hospital District hereby retains Sheridan and Sheridan
accepts such retention, to provide all Anesthesiologist Services at the Hospital
on an exclusive basis, and to provide Medical Administrative Services in
accordance with the terms of this Agreement in order to assure the consistency,
quality and availability of Anesthesiologist Services to Hospital Patients. The
exclusivity granted to Sheridan under this Section means that during the term of
this Agreement, and any extension thereof, Hospital District will not obtain
Medical Administrative Services for the Hospital from any other party, and
Hospital District will not grant privileges to perform Anesthesiologist
Services, to:
(i) any physician specializing in anesthesiology;
(ii) any anesthesiologist specializing in pain management
services, including, without limitation, out-patient and in-patient pain
management, epidural and subarachnoid narcotic administration;
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(iii) any physician specializing in patient controlled
analgesia ("PCA") including, without limitation, medical initiation, supervision
and follow-up of PCA; or
(iv) any CRNA;
(v) unless that Physician or CRNA has been employed
or retained by Sheridan as provided in this Agreement.
Nothing in this Agreement limits the privileges that may be granted to
physicians who are not:
(i) physicians specializing in Anesthesiology
(ii) anesthesiologists specializing in pain management; or
(iii) physicians specializing in PCA.
2.2 Sheridan Outside Activities. Hospital District acknowledges that
Sheridan is and will continue to be involved in performing medical and
administrative duties in the nature of those provided pursuant to this Agreement
for entities other than Hospital District. Sheridan shall not be prohibited from
engaging in such activities outside of Hospital, so long as Sheridan continues
to provide Anesthesiologist and Medical Administrative Services consistent with
Hospital District's needs and standards specified in this Agreement.
Sheridan further acknowledges that it will not use its position of
trust and confidence to gain an advantage for any facility competing with
Hospital District, nor will it disclose to a competitor of Hospital District any
planning, marketing, operational, or other information which could be considered
proprietary.
Sheridan further agrees that without permission of the Hospital
District neither it, nor its retained Anesthesiologists shall own, directly or
indirectly, any interest in any entity or organization that performs physician
or other health care services (other than Anesthesiologist Services) within the
geographical boundaries of the South Broward Hospital District. This permission
will not be unreasonably withheld. Activities to which Hospital District
consents are listed on Attachment A.
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The ownership of shares or options by Sheridan or by its retained
Anesthesiologists in Sheridan Healthcare, Inc., (hereinafter referred to as
"Sheridan Healthcare") or Sheridan Healthcorp, Inc., publicly traded
corporations, will not be considered a breach of this Agreement.
2.3 Independent Contracts. Pursuant to this Agreement, Sheridan may
make independent contracts or agreements with Anesthesiologists and CRNAs to
assist Sheridan in meeting Sheridan's obligations under this Agreement, but
Hospital District shall not be a party to, or be bound by, such agreements.
III. COVENANTS OF SHERIDAN:
3.1 Scheduling of Anesthesiologist Services. Sheridan shall provide
Anesthesiologists to perform Anesthesiologist Services to the Hospital District
through twenty-four (24) hours each day, seven (7) days each week, including
holidays. Sheridan shall establish schedules to be approved by the Administrator
for Anesthesiologists to ensure that Hospital District's needs for
Anesthesiologist Services are fully met, as reasonably determined by the Chief
Executive Officer. Said coverage shall include, without limitation, at least one
(1) Anesthesiologist physically present at Memorial Regional Hospital at all
times.
3.2 Individual Anesthesiologists. In the event that the Hospital
District shall advise Sheridan that it questions whether it is in the best
interest of the Hospital District or Sheridan for Sheridan to continue to
provide to Hospital District the services of any specific Anesthesiologist,
Sheridan will promptly meet with Hospital District in a conscientious and good
faith effort to reach a concurrence with Hospital District on such questions. If
no concurrence can be reached, Hospital District's recommendation will be
binding on Sheridan.
3.3 Medical Director Coverage. Hospital District and Sheridan agree
that the Anesthesiology Medical Directors of the Hospital District, and its
individual Hospitals shall be determined by mutual agreement. Sheridan may, at
its discretion, terminate the services of any Anesthesiology Medical Director.
Sheridan shall provide an Anesthesiologist acceptable to Hospital District to
assume the duties of any Medical Director whose services are terminated, or who
is absent from the Hospital for vacation, sick leave, or for any other reason.
Sheridan shall notify the Hospital District of the individual or individuals so
designated and such designation shall be subject to the approval of Hospital
District.
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3.4 Automatic Termination of Privileges. In the event that any
Anesthesiologist's or CRNA's affiliation with Sheridan is terminated for any
reason, then the Medical Staff privileges of such Anesthesiologist or CRNA at
the Hospital shall be terminated automatically. Upon termination of this
Agreement, the Medical Staff privileges of all of Sheridan's retained
Anesthesiologists and CRNA's shall be terminated automatically.
All Anesthesiologists and CRNA's shall, by written agreement with
Sheridan, waive any and all rights to a hearing and appeal under the Medical
Staff By-laws with respect to termination of privileges under this Section, and
no other provision of this Agreement shall limit the operation of this Section.
Without limitation of the foregoing, this Agreement does not preclude
any Anesthesiologist or CRNA from reapplying for medical staff membership and
privileges following such automatic termination. Following such reapplication,
if such Anesthesiologist or CRNA qualifies for readmission to the medical staff
or the granting of clinical privileges in accord with the then current Hospital
District Policies, including, without limitation, bylaws, rules and regulations
of the Medical Staff, then such Anesthesiologist or CRNA will be granted such
membership or clinical privileges without regard to prior automatic termination
due to termination of this Agreement. By way of example, but without limitation
of the foregoing, after termination of this Agreement, any Anesthesiologist or
CRNA would not be eligible for granting of privileges at Memorial Regional
Hospital or Memorial Hospital West or Memorial Hospital Pembroke if such
privileges remain "closed" at Memorial Regional Hospital and Memorial Hospital
West and Memorial Hospital Pembroke, and limited to Anesthesiologists retained
by Sheridan, or any other party contracting with Hospital District following
termination of this Agreement.
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Further, without limitation of the foregoing, it is understood and
agreed that Sheridan shall not impose restrictions which would be applicable
after termination of this Agreement, by contract or otherwise, which
restrictions would prevent or limit Sheridan's retained Anesthesiologists and
CRNA's from contracting with Hospital District, directly or through contracts
similar to this contract, for the provision of Anesthesiologist Services to
Hospital District.
3.5 Ownership. The ownership and right of control of all reports,
records, and supporting documents prepared in connection with the operation of
the Hospital shall vest exclusively in Hospital District, provided, however,
that Sheridan shall have such right of access to such reports and records and
other supporting documentation as is necessary and as consistent with applicable
law and Hospital District Policies.
3.6 Sheridan Organizational Requirements. It is understood and agreed
that Sheridan, a corporation created pursuant to the laws of the State of
Florida, shall at all times: (1) be and remain legally organized and operated to
provide Anesthesiologist Services in a manner consistent with all State and
Federal laws, and (2) have and maintain a reasonably suitable replacement,
acceptable to Hospital District, as one of its members, directors or officers
who shall (a) be a Anesthesiologist, (b) discharge the duties of Anesthesiology
Medical Director, and (c) be engaged principally in the provisions of services
under this Agreement.
3.7 General Responsibilities. Each Anesthesiologist shall, as assigned
during the term of this contract, provide prompt Anesthesiology Services,
irrespective of sex, race, color, national origin, or ability to pay. Such
treatment shall be consistent with the facilities and equipment available and
with the prevailing professional standard of care.
3.8 Use of Premises. Sheridan agrees that its Anesthesiologists will
use the premises of the Hospital exclusively for the performance of services
hereunder, and will not do anything on the premises which is expressly
prohibited by the Administrator.
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3.9 Insurance.
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3.9-1 Amount. Sheridan shall obtain and maintain professional liability
insurance covering Sheridan and all of Sheridan's personnel including, without
limitation, each Anesthesiologist, and each CRNA, in the minimum amount of One
Million Dollars ($1,000,000) per claim and Three Million Dollars ($3,000,000) in
the annual aggregate, for the entire term of this Agreement, with company or
companies and under contracts deemed reasonably acceptable by Hospital District.
3.9-2 Continuous Claims Made Coverage. Sheridan shall maintain the
insurance required hereunder on a continuous claims made basis, or through the
purchase of tail coverage or prior acts coverage, if applicable, in the amount
described above for Sheridan and all of Sheridan's personnel, including, without
limitation, each Anesthesiologist, and each CRNA, to ensure coverage for claims
made after the termination of this Agreement, alleged to arise during the term
of this Agreement.
In the event Sheridan fails to provide Hospital District with proof of
continuous claims made coverage or tail coverage or prior acts coverage, as may
be applicable, as required under this Section within thirty (30) days prior to
the lapse of coverage under a claims made policy, then this Agreement shall be
Hospital District's authorization to purchase said tail coverage or prior acts
coverage as Sheridan's agent, for this limited purpose. This authorization shall
be irrevocable, upon Sheridan's failure to provide proof of tail coverage within
the time limit stated above after written notice from Hospital District.
Sheridan shall reimburse Hospital District for all costs associated with said
purchase, including, without limitation, broker's fees.
3.9-3 Proof of Insurance. Sheridan shall furnish Hospital District with
proof of insurance and shall furnish copies of all amendments and renewals to
each policy so long as this Agreement is in effect. Sheridan shall additionally
cause to be issued by such insurer or insurers a certificate thereof reflecting
such coverage which coverage shall be cancelable only upon at lease thirty (30)
days advance written notice from such insurer or insurers to Sheridan and
Hospital District. In all events, Sheridan shall provide Hospital District with
written notice of any change or cancellation in such coverage at least thirty
(30) days prior to the effective date of such change or cancellation. No
Anesthesiologist shall be permitted to perform Anesthesiologist Services at the
Hospital unless compliance with this Section is demonstrated to Hospital
District, to the satisfaction of the Administrator.
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3.10 Risk Management Obligation. Any "incident" known to Sheridan
occurring in the Hospital that could result in liability to Sheridan or Hospital
District shall be reported immediately to Hospital District. For purposes of
this Agreement, an "incident" is defined as any happening or occurrence which is
not consistent with the routine operation of the Hospital or of the routine care
of a particular patient. It may be an accident or a situation such as lost or
damaged property or a condition which could result in an accident.
3.11 Alteration of Premises. Sheridan shall not make, or suffer to be
made, any alterations to the premises of the Hospital or any part thereof, even
at Sheridan's own expense, without the written consent of the Hospital District.
3.12 Equal Employment Opportunity. Without limiting any provision
herein set forth, Sheridan expressly agrees to abide by any and all applicable
Federal and/or State Equal Employment Opportunity Statutes, Rules and
Regulations including, without limitation, Title VII of the Civil Rights Act of
1964, the Equal Employment Opportunity Act of 1972, the Age Discrimination and
Employment Act of 1967, the Equal Pay Act of 1963, the National Labor Relations
Act, the Fair Labor Standards Act, the Rehabilitation Act of 1973, and the
Occupational Safety and Health Act of 1970 -- all as may be, from time to time,
modified or amended. Sheridan agrees that its Anesthesiologists and CRNAs shall
not engage in any conduct which would be considered harassment or discrimination
in any manner under applicable law or Hospital District Policies, including,
without limitation, racial, sexual, gender, or handicap.
3.13 Collegiality. Sheridan recognizes and acknowledges that the role
of each Anesthesiologist and CRNA provided by Sheridan hereunder requires him or
her to work in a cooperative and harmonious manner with his or her colleagues on
the Medical Staff, as well as professional, technical, and other personnel of
the Hospital, including, without limitation, the Chief Executive Officer and
other administrative personnel of Hospital District. Each Anesthesiologist and
CRNA provided by Sheridan hereunder shall work in a cooperative manner to
promote the best interests of Hospital District and the patients he or she is
treating. It is understood and agreed that Anesthesiologists will be held to a
higher standard of cooperation under this section than those standards required
for other members of the Medical Staff who not Hospital based providers.
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3.14 Exclusive Ownership. Except as provided otherwise herein, all
patient revenues and all non-patient revenues identified with other departments,
the Hospital, or Hospital District in general, shall be the exclusive property
of Hospital District. Without limiting the generality of the foregoing, it is
specifically understood and agreed as follows:
3.15 Gifts and Grants. Hospital District shall receive and be vested in
full ownership of all gifts and grants of money or other property to or for use
with respect to the Hospital, from any source whatsoever.
3.16 Other Non-Patient Revenues. Hospital District shall receive and be
vested in full ownership of all other non-patient revenues of the Hospital.
3.17 Applicable Standards. Sheridan shall reasonably provide Medical
Administrative and Anesthesiologist Services in such a manner as will ensure
that all duties are performed and services provided hereunder, as may be
required by law or regulation, including, without limitation, any standard,
ruling or regulation of the Joint Commission on Accreditation of Health
Organizations, the Department of Health and Human Services or any other Federal,
State or local government agency, corporate entity or individual exercising
authority with respect to, or affecting the Hospital. Sheridan shall ensure that
all Medical Administrative and Anesthesiologist Services are rendered in a cost
effective, efficient manner, and in accord with the prevailing professional
standard of care as defined by Ch. 766, Fla. Stat., in conformity with the
prevailing professional standard of care, as defined by ss.766, Fla. Stat.
3.18 CRNA's. All CRNAs retained by Sheridan under this Agreement must
be licensed and, within two years, certified in accord with Ch. 464.012, Fla.
Stat., with special training in Anesthesia. All CRNAs performing services at the
Hospital under this Agreement, must be approved by the Medical Staff, and may
only perform such procedures as are approved by the Medical Staff, and each will
have a thirty (30) day period of observation during which all physical
examinations performed on patients will be reviewed by an Anesthesiologist.
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All notes and orders written by the CRNA will be countersigned by an
Anesthesiologist.
All CRNAs provided by Sheridan shall be employees of Sheridan and be
under the sole direction and control of Sheridan and Anesthesiologists, and
shall be covered as a named insured under the professional liability insurance
required under Section 3.9 of this Agreement.
Sheridan shall obtain and maintain workers' compensation coverage for
all CRNAs providing services under this Agreement, and shall provide Hospital
District with proof of such coverage.
IV. COVENANTS OF HOSPITAL DISTRICT:
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4.1 Operational Requirements. Hospital District shall, after
considering the recommendations of Sheridan provide such facilities, equipment,
supplies, utilities, janitorial, laundry, and other support services as Hospital
District shall deem necessary for the functioning of the Hospital.
4.2 Hospital District-Supplied Personnel. Hospital District shall
employ, terminate, and when it deems appropriate, reinstate such personnel as
Hospital District deems necessary for the proper operation of the Hospital.
V. FINANCIAL ARRANGEMENT:
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5.1 Sheridan Charges. Sheridan shall, from time to time, establish and
amend the Schedule of Charges for Anesthesiologist Services (the Fee Schedule)
to be rendered to patients by Sheridan. Whenever Sheridan desires to change the
Fee Schedule or to add a new procedure during the term, Sheridan shall promptly
provide the Chief Operating Officer with written notice of such change or new
procedure, specifying the existing fee, and the proposed amount of increase or
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decrease. Sheridan shall obtain the approval of the Administrator prior to
implementing such change or new procedure, which approval shall not be
unreasonably withheld. If the Administrator fails to respond within 90 days from
receipt of same, approval shall be deemed to have been given. Sheridan shall
provide the Chief Operating Officer with a copy or copies of such Schedule or
Schedules of Charges upon request, at any time during the term. All fees for
Anesthesiologist Services shall be reasonable and competitive with fees charged
for similar Anesthesiologist Services elsewhere in the community, and shall not
violate any law or regulation governing such fees, including, without
limitation, Federal Medicare Statutes and Regulations. Such charges are separate
and distinct from the charges made by Hospital District for Hospital Services
furnished to patients. It is understood and agreed that the Fee Schedule does
not incorporate by reference any negotiated discounts between Hospital District
and any third party payors. Relationships between third party payors shall be as
specified in Section 5.5 of this Agreement.
5.2 Schedule of Hospital District Charges. Hospital District shall,
from time to time, establish and amend a schedule of charges for services other
than Anesthesiologist Services to be rendered to patients, which charges shall
be separate and distinct from the charges made by Sheridan for Anesthesiologist
Services.
5.3 Sheridan Billing and Collection. Sheridan shall separately bill and
collect at its risk and expense for Anesthesiologist Services furnished by
Sheridan to patients at the Hospital. Hospital District shall take all steps
reasonably requested by Sheridan to provide information to assist in the billing
and collection of fees for those Anesthesiologist Services.
5.4 Hospital District Billing and Collection. Hospital District shall
perform appropriate billing and collection functions for all Hospital Services
at the Hospital by Hospital District. Sheridan shall take all steps reasonably
requested by Hospital District to provide information to assist in the billing
and collecting of fees for those services.
5.5 Third Party Payors.
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A. Sheridan agrees to accept Medicare assignment plus any supplemental
or additional insurance as payment in full for all Anesthesiologist Services
rendered at the Hospital for all Medicare patients.
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B. Sheridan recognizes that Hospital District is a participant in
various third party payment plans, which include, without limitation, insurance
companies, "managed care" companies, as such term is commonly used in the health
care industry and other third party payors. Generally, the term managed care is
understood to mean a program whereby health care costs are controlled or reduced
through the monitoring of the necessity and cost effectiveness of services
provided; either through prospective, concurrent, or retrospective review.
C. Sheridan agrees to negotiate in good faith with managed care
companies (including by way of example, and without limitation, Health
Maintenance Organizations, and Preferred Provider Organizations) and other third
party payors for the provision of Anesthesiologist Services at rates less than
Sheridan's full rates.
D. Sheridan agrees to provide Anesthesiologist Services at Memorial
Regional Hospital, Memorial Hospital West and other South Broward Hospital
District facilities to managed care companies and other third party payors at
the lowest rates of compensation offered by Sheridan to that managed care
company or third party payor for Anesthesiologist Services at any hospital or
health care facility within the geographic boundaries of Dade and Broward
Counties.
E. In the event that Hospital District enters into a contract to
provide services with a particular third party payor, Sheridan will either
maintain an existing contract, or, if Sheridan does not have an existing
contract, Sheridan shall attempt, in good faith, to enter into or participate in
a contract to provide services with that third party payor. In the event
Sheridan cannot reach agreement with that third party payor within 60 days, then
Hospital District shall use its best efforts and participate in negotiations
between Anesthesiology Associates and the third party payor for an additional 30
days.
F. Sheridan shall ensure that all of its retained Anesthesiologists
providing services at Hospital District's facilities are bound by the terms of
the Agreement with the third party payor, with respect to services provided on
behalf of Sheridan in accordance with the requirements of this section.
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5.6 Subsidy for Services Rendered to Patients of the Sunlife Program.
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A. Hospital District established a program at Memorial Regional
Hospital for the treatment of all patients requiring the services of an Ob/Gyn
specialist, who present to Memorial Regional Hospital and who do not have a
physician. This program involved retaining Ob/Gyn specialists through a
corporation known as Sunlife Ob/Gyn Services of Hollywood, Inc. The program is
hereinafter referred to as the "Sunlife Program."
B. Generally, patients of the Sunlife Program are indigent, but in
rare instances such a patient may not be indigent, or may have private health
insurance or Medicare or Medicaid.
C. Previously, Hospital District operated a program to provide
anesthesia care to obstetrical patients of the Sunlife Program, through the use
of certain Certified Registered Nurse Anesthetists (CRNA's) who were employed by
Hospital District, but generally under the physician supervision of Sheridan.
D. The parties believed that greater operational efficiencies and a
more economic use of resources can be achieved by consolidating delivery and
supervision of all anesthesia services under the auspices of Sheridan. In order
to achieve this goal, Hospital District terminated its use of employed Certified
Registered Nurse Anesthetists so that the services provided by Sheridan to
Hospital District, included, without limitation, the Anesthesiologist and
Certified Registered Nurse Anesthetist services for patients of the Sunlife
Program.
E. This change increased Sheridan's obligations to Hospital District to
provide indigent care.
F. During the term of this Agreement, in and for consideration of
Anesthesiologist and Certified Registered Nurse Anesthetist services for all
indigent patients of Hospital District, including, without limitation, patients
of the Sunlife Program, provided by Sheridan under this Agreement, Hospital
District shall pay Sheridan the amount of Four Hundred Fifty Thousand and No/100
Dollars ($450,000.00) per year, payable in equal installments of Thirty Seven
Thousand Five Hundred and 00/100 Dollars ($37,500.00) per month.
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Said monthly payments shall be payable on the first day of each month,
for that month, during the term of this Anesthesiology Agreement.
5.7 Compensation for Services of Sheridan. Sheridan shall be entitled
to all collections for Anesthesiologist Services furnished by Sheridan to
patients as billed and collected by Sheridan. Sheridan accepts such amounts
separately billed and collected by Sheridan plus payment of the subsidy for
Sunlife patients under Section 5.6, above, as Sheridan's sole compensation for
administrative services, Anesthesiologist Services, and all other items or
services provided pursuant to this Agreement. It is understood and agreed that
nothing in this Agreement shall be construed as a guarantee of income to
Sheridan (with the exception of payments under Section 5.6, above), and under no
circumstance shall Hospital District be liable to Sheridan for payment of any
additional sums, including, without limitation, payment for Anesthesiologist
Services rendered to indigent patients.
Without limiting the above, with the exception of payments under
Section 5.6, above, Sheridan and Anesthesiologists shall not seek, or be
entitled to, any reimbursement from Hospital District for care rendered to
indigent patients, including, without limitation, participation in any program
established by Hospital District to reimburse the Medical Staff, either
collectively or individually, for care rendered to indigent patients.
VI. TERM AND TERMINATION OF AGREEMENT:
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6.1 Contract Term. This Agreement shall be effective as of the First
day of January,1997,and shall run for a term of Thirty Six(36) months therefrom,
subject to Section 6.2 hereof.
6.2 Termination.This Agreement may be sooner terminated on the first
to occur of the following:
6.2-1 Termination of Agreement. In the event Hospital District and
Sheridan shall mutually agree in writing, this Agreement may be terminated on
the terms and date stipulated therein.
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6.2-2 Termination for Failure to Maintain Required Insurance. In all
circumstances in which Sheridan has given thirty (30) days advance written
notice of a change or cancellation of insurance under Section 3.9 herein,
Sheridan shall have fifteen (15) days from the date of such notice to obtain the
insurance coverage required herein.
In the event that such coverage cannot be obtained within fifteen (15)
days from the date of said notice, Hospital District may secure Anesthesiologist
Services from any other party, at its sole discretion, and this Agreement may be
terminated fifteen (15) days thereafter, at the sole option of Hospital
District.
6.2-3 Termination Due to Legislative or Administrative Changes. In the
event that there shall be a change in the Medicare or Medicaid Acts, regulations
or general instructions (or application thereof), the adoption of new
legislation, or a change in any other third party payor reimbursement system,
any of which materially adversely affects or impairs the reimbursement which
Hospital District or Sheridan may receive for their respective services
furnished to patients of the Hospital, either party may, by notice, propose a
new basis for compensation for the services furnished pursuant to this
Agreement. If such notice of new basis is given and if Sheridan and Hospital
District are unable within thirty (30) days thereafter to agree upon a new basis
for compensation, either party may terminate this Agreement by thirty (30) days
notice to the other on any future date specified in such notice.
6.2-4 Termination Due to Change of Control of Sheridan. In the event of
a change in control of Sheridan, pursuant to Section 7.4 below, Hospital
District may terminate this Agreement upon thirty (30) days advance written
notice.
6.2-5 Optional Termination. After the first six (6) months of this
Agreement, this Agreement may be terminated by either party, without cause, upon
written notice given six (6) months in advance of the intended date of
termination.
6.2-6 Effects of Termination. Upon termination of this Agreement, as
hereinabove provided, neither party shall have any further obligations hereunder
except for (i) obligations accruing prior to the date of termination and (ii)
obligations, promises or covenants contained herein which are expressly made to
extend beyond the term of this Agreement, including, without limitation,
indemnities and professional liability tail coverage, if applicable.
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VII. MISCELLANEOUS:
--------------
7.1 Status of Sheridan. It is expressly acknowledged by the parties
hereto that Sheridan is an "independent contractor" and nothing in this
Agreement is intended nor shall be construed to create an employer/employee
relationship, or to allow Hospital District to exercise control or direction
over the manner or method by which Sheridan or Anesthesiologists perform the
Anesthesiologist Services which are the subject matter of this Agreement;
provided always that the Services provided hereunder by Sheridan shall be
provided in a manner consistent with the standards governing such Services and
the provision of this Agreement. Sheridan understands and agrees that (1)
Hospital District will not withhold, on behalf of Sheridan or any
Anesthesiologist pursuant to this Agreement, any sums for income tax,
unemployment insurance, Social Security, or any other withholding pursuant to
any law or requirement of any governmental body relating to Sheridan or
Anesthesiologists, or make available to Sheridan or Anesthesiologists any of the
benefits afforded to employees of Hospital District; and (2) all of such
payments, withholdings, and benefits, if any, are the sole responsibility of
Sheridan. In the event the Internal Revenue Service should question or challenge
the "independent contractor" status of Sheridan or Anesthesiologists, the
parties hereto mutually agree that both Sheridan and Hospital District shall
have the right to participate in any discussion or negotiation occurring with
the Internal Revenue Service, irrespective of whom such discussions or
negotiations concern, or by whom such discussions or negotiations are initiated.
7.2 Notices. Any notice, demand, or communication required, permitted,
or desired to be given hereunder, shall be deemed effectively given when
personally delivered or mailed by prepaid Certified Mail, Return Receipt
Requested, addressed as follows:
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SHERIDAN: HOSPITAL DISTRICT:
- --------- ------------------
Attn: Vice President and Administrator
General Counsel Memorial Regional Hospital
Sheridan Healthcorp, Inc. 3501 Johnson Street
4651 Sheridan Street, Suite 200 Hollywood, Florida 33021
Hollywood, Florida 33021
. . . or to such other addresses and to the attention of such other persons or
officers as either party may designate by written notice.
7.3 Governing Law. This Agreement has been executed and delivered in,
and shall be interpreted, construed, and enforced pursuant to and in accordance
with, the laws of the State. All duties and obligations of the parties created
hereunder are performable in Broward County, Florida, and Broward County,
Florida shall be the sole and exclusive venue for any litigation, special
proceedings, or other proceedings as between the parties that may be brought or
arise out of or in connection with or by reason of this Agreement.
7.4 Assignment. No assignment of this Agreement or the rights and
obligations hereunder shall be valid without the specific written consent of
both parties. Without limitation of the foregoing, it is understood and agreed a
change in the control of Sheridan Healthcorp, Inc., or Sheridan Healthcare,
Inc., (whether directly or indirectly, including, without limitation, through
change in the type of corporation, merger, consolidation, or management
agreement, or sale or other transfer of more than 50% of the ownership of any of
the above specified corporations, or in the event that Mitchell Eisenberg and
Lewis Gold shall no longer be actively engaged or employed in the day to day
business of Sheridan) shall be considered an assignment of this Agreement, and
in such event, Hospital District may terminate this Agreement upon thirty (30)
days advance written notice.
7.5 Waiver of Breach. The waiver by either party of a breach or
violation of any provision of this Agreement shall not operate as, or be
construed to be, a waiver of any subsequent breach of the same or other
provision hereof.
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7.6 Enforcement. In the event Hospital District or Sheridan resorts to
legal action to enforce the terms and provisions of the Agreement, the
prevailing party shall be entitled to recover the cost of such actions so
incurred including, without limitation, reasonable attorney's fees, costs and
expenses, at both trial and appellate levels.
7.7 Gender and Number. Whenever the context hereof requires, the gender
of all words shall include the masculine, feminine, and neuter and the number of
all words shall include the singular and plural.
7.8 Force Majeure. Neither party shall be liable nor deemed to be in
default for any delay or failure in performance under this Agreement or for
other interruption of service deemed resulting, directly or indirectly, from
acts of God, civil or military authorities, acts of the public enemy, war,
accidents, fires, explosions, earthquakes, floods, failure of transportation,
strikes or other work interruptions by Hospital District's employees or any
similar or dissimilar cause beyond the reasonable control of either party.
7.9 Severability. In the event any provision of this Agreement is held
to be unenforceable for any reason, the unenforceability thereof shall not
affect the remainder of the Agreement, which shall remain in full force and
effect and enforceable in accordance with its terms.
7.10 Article and Other Headings. The article and other headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.
7.11 Time of Essence. Time shall be of the essence with respect to this
Agreement.
7.12 Public Relations. Sheridan agrees that neither it nor its retained
Anesthesiologists shall make any statements to the press or to any media
representatives concerning matters relating to this Agreement or the performance
of duties hereunder without the consent of the Administrator.
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7.13 Entire Agreement. This Agreement supersedes all previous contracts
and constitutes the entire Agreement between the parties. Without limitation of
the foregoing, this Agreement, upon its effective date, terminates and replaces
entirely that certain Agreement between the parties dated October 1, 1990, and
all Amendments thereto. Neither party shall be entitled to benefits other than
those specified herein. No oral statements or prior written material not
specifically incorporated shall be of any force and effect and no changes in or
additions to this Agreement shall be recognized unless incorporated herein by
amendment signed by both parties, such amendments to become effective on the
date stipulated in such amendments. The parties specifically acknowledge that in
entering into and executing this Agreement, they rely solely upon the
representation and agreements contained in this Agreement, and no others.
IN WITNESS WHEREOF, South Broward Hospital District, a political
subdivision of the State of Florida, has caused this Agreement to be executed in
its corporate name by its duly authorized undersigned Chief Executive Officer on
the date and year written below.
IN WITNESS WHEREOF, Sheridan Healthcorp, Inc., a Florida Corporation,
has caused this Agreement to be executed in its corporate name by its duly
authorized undersigned Vice-President on the date and year written below.
SHERIDAN HEALTHCORP, INC.: SOUTH BROWARD HOSPITAL DISTRICT:
___________________________________ ___________________________________
Jay A. Martus Frank V. Sacco
Vice-President Chief Executive Officer
DATE: ________________________ DATE: ____________________________
APPROVED AS TO FORM AND CONTENT:
___________________________________
Clarke Walden, General Counsel
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