EXHIBIT 10.9
[CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.]
NETWORK ACCESS AND REPRICING AGREEMENT
THIS NETWORK ACCESS AND REPRICING AGREEMENT (this "Agreement") is made and
entered into as of the first day of September 2002 by and between International
Health Partners, Inc., an Indiana corporation located at 120 Gibraltar Road,
Suite 107, Horsham Pennsylvania ("CARExpress"), and First Access, Inc. ("FA"), a
California corporation located at 25108 Marguerite Parkway, # 214, Mission
Viejo, California 92692.
WHEREAS, FA has arranged for CARExpress to access networks of credentialed
providers (a list of provider networks contracted with FA and with which
CAREXPRESS will be leasing from FA under this agreement is listed and each is
described under Exhibit B of this Agreement.); and
WHEREAS, CAREXPRESS desires to enjoy the benefit of the network's negotiated
contracted rates for purposes of providing individuals affiliated with
CAREXPRESS and who (or whose dependents) are entitled to such contracted rates
hereunder ("Cardholders") with the right to take the difference between the
contracted rates off of customary charges for services rendered by the preferred
providers in accordance with agreements between the Network(s) and such
providers;
WHEREAS, FA is in the business of automating the re-pricing of charges of
preferred provider (the "Network") -time using FA's patent pending repricing
system; and
WHEREAS, CAREXPRESS desires to purchase access to FA's patent pending repricing
system and services;
NOW THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which is acknowledged, CAREXPRESS
and FA agree as follows:
1. CAREXPRESS RESPONSIBILITIES
1.01. CAREXPRESS shall purchase FA's repricing services and access to the
Network(s) for its specified Cardholders by (1) paying the fees
specified in Article 4 below, (2) submitting to FA, no later than the
last day of the preceding month, a "full file" eligibility statement
(the "Statement") for the entire eligibility record which shall set
forth (a) the total number of Cardholders, including any deletions with
the appropriate termination dates and (b) the monthly fee due FA
hereunder, which fee shall be calculated in accordance with Section
4.02 below, and (3) submitting to FA no later than the last day of the
month, the name and identification number of each Cardholder for the
following month. All information required by this section shall be
provided in a form that is reasonably acceptable to FA.
1.02. At any time, CAREXPRESS may amend the Statement for the current month
to include the names of additional Cardholders of CAREXPRESS by
submitting to FA either a list of the name and identification number of
each such additional Cardholder or a new Statement reflecting the names
of such additional Cardholders. CAREXPRESS shall not be entitled to
prorate the fees due FA hereunder-in connection with any such
additional Cardholder; for each Cardholder listed on a Statement
(including any Cardholder added pursuant to this Section 1.01),
CAREXPRESS shall pay the applicable fee for the full calendar month in
accordance with Section 4.02 below.
1.03. CAREXPRESS may delete Cardholders from the Statement at any time by
submitting a Statement specifying the name and identification number of
any Cardholder to be so deleted; provided however that CAREXPRESS shall
not be entitled to prorate the monthly fee due FA hereunder with
respect to any such deleted Cardholder and shall pay FA the full
monthly fee for such deleted Cardholder for the month in which such
Statement was submitted.
1.04. CAREXPRESS agrees to communicate with and educate its Cardholders in
connection with the right to access the Network(s) and to obtain the
repricing services provided by FA hereunder.
1.05. Within two (2) business days after receipt by FA of any Statement from
CAREXPRESS satisfying the requirements set forth in Section 1.01 above
or any amended Statement from CAREXPRESS satisfying the requirements
set forth in Section 1.03 above, any and all Cardholders of CAREXPRESS
included in such Statement (or amended Statement) shall be entitled to
visit any provider in the Network(s) and to receive the contracted
prices for services rendered by such provider in accordance with the
contract between the Network(s) and such provider.
1.06. FA reserves the right to terminate any individual enrollment of a
CAREEXPRESS member for failure to pay a medical provider accessed under
FA's program in a timely manner and/or in a manner consistent with that
agreed upon between the member and the provider. In such a situation,
FA will contact CARExpress with the details of the situation and allow
CARExpress to intervene and communicate with the member, and strive to
resolve the problem prior to cancellation of the member's access to the
networks.
1.07. In order to receive the contracted rates from FA's hospital PPO
partners, CAREXPRESS members must follow the pre-certification
procedure as outlined in the "NOTICE REGARDING HOSPITAL ACCESS" exhibit
C of this contract. Members who failure to follow these procedures will
not be entitled to receive the contracted rate.
2. FA RESPONSIBILITIES
2.01. FA agrees to provide to CAREXPRESS access to the FA Network(s)
described in Exhibit B of this agreement for CAREXPRESS' Cardholders in
accordance with this Agreement. FA warrants that all providers
participating in FA networks meet the following criteria:
i. Preferred providers are currently licensed and in good
standing in the states in which they practice and have had no
significant disciplinary history that will affect the equality
of patient care.
ii. Preferred providers are credentialed, at a minimum, according
to the principles of NCQA credentialling standards.
iii. Preferred providers carry professional liability insurance
consistent with the greater of state law or Professional
Association requirements or overwhelming regional standards of
Insurance coverage.
iv. Preferred providers shall call a toll free number to access
the "First Access" re-pricing system in order to obtain the
applicable fee schedule and collect the entire allowable
amount from the cardholder at the point of service.
v. Preferred providers shall accept the Network(s) allowable
amount for services provided in the provider's office as
payment in full. Preferred Providers are not obligated to
accept to the contracted rate if the member did not follow the
Hospital Pre-Certification or the member's terms and
conditions procedures as outlined in the attached Exhibit C.
vi. Alpha-numeric, CPT4 codes and provider offices with remote
administration may require a paper claim submission either
from the provider or the patient. In these instances, FA shall
reprice the provider encounter and communicate to both the
provider and the cardholder the contracted rate with an
Explanation of Benefits letter. The submission of a paper
claim, shall not release the provider from it's contractual
obligation of providing the cardholder the contracted rate.
2.03 FA shall provide repricing services for CAREXPRESS' Cardholders in
accordance with this Agreement.
2.04 FA shall provide CAREXPRESS with information on a monthly basis
regarding the amount of savings realized by Cardholders based on the
network's contracted rates for providers in the Network(s) which were
repriced using CAREXPRESS' dedicated toll-free number, including the
number of calls made using such number.
2.05 FA shall provide CARExpress with the option of using any or all of the
multiple networks listed in Exhibit B of this Agreement (including
their various sub-networks and contracted networks) throughout the
country. The FA Network(s) chosen can be on the basis of optimal
provider coverage for any CARExpress member or group account,
most competitive provider contract fees and/or most competitive access
fees. FA shall work with CAREXPRESS to identify the most appropriate
Network(s) for CAREXPRESS' cardholders.
3. TERM AND TERMINATION
The term of this Agreement shall commence upon execution by both parties hereto
and shall continue until terminated upon ninety days written notice (however
such notice may not be given until one (1) year after the effective date of this
Agreement) from one party to the other or until terminated in accordance with
Section 4.03 below; provided however that this Agreement shall be immediately
terminable by either party (in which event such party shall promptly notify the
other party) in the event the other party breaches any material obligation
hereunder. In the event of termination, all rights and obligations hereunder
shall cease, except for the provisions of Article 13 and Article 16, each of
which shall survive the termination of this Agreement. Notwithstanding the
preceding sentence, in the event this Agreement shall be terminated by either
party as permitted herein, CAREXPRESS shall remain liable for the payment of all
fees due FA for services furnished hereunder prior to such termination.
4. COMPENSATION & PRICING
4.01. MONTHLY MINIMUM: CARExpress shall pay to FA a monthly minimum equal to
[**] per month, regardless of the number of CARExpress members actively
using FA's services. Minimum fees shall accrue if not used and may be
applied toward all access fees or retained savings fees due to FA from
CARExpress. This monthly minimum shall commence on or before October
15, 2002.
** CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4.02. FA will provide the following services as a part of the paid fees:
toll-free provider referral service, pre-certification service,
physician, ancillary and facilities, repricing of all claims, claim
resolution and provider relations: HOSPITAL, EMERGENCY ROOM AND
ANCILLARY FACILITIES DISCOUNTS ARE SEPARATELY NEGOTIATED AND ARE NOT A
PART OF THIS AGREEMENT.
Monthly fee per cardholder per month: Actual fees will be credited
toward the monthly minimum
0-20,000 [**]
20,001 to 50,000 [**]
50,001 to 75,000 [**]
75,001 to 100,000 [**]
100,001 to 250,000 [**]
A. Monthly fees, to be paid no later than the 10th day of each
month for the month immediately preceding, based on the aggregate
number of all Cardholders listed on the Statements submitted for such
preceding month by CAREXPRESS to FA in accordance with Section 1.01 and
1.02 above, which fees shall be calculated by multiplying such total
number of Cardholders by the applicable monthly fee.
4.03. Retention of Earned Savings: CARExpress and FA have not completed
negotiations yet on the sharing of retained savings when CARExpress
group accounts choose to retain a percentage of the savings achieved
from use of the FA network. This contract will include those fees in a
separate exhibit when both parties have agreed on the terms.
4.04. FA may adjust its fees due hereunder after receiving an increase notice
from the Network(s). FA will provide written notice to CAREXPRESS at
least 60 days prior to the date of such adjustment. For a period of
fifteen days after the date of any such notice, CAREXPRESS shall have
the option to terminate this Agreement by giving written notice to FA
of the exercise of such option, such termination to be effective as of
the business day immediately preceding the effective date of the
proposed fee adjustment. FA will be limited, however, to a maximum of
10% increase once each year.
4.05. Subject to 4.06 below, in the event of any material breach of any term
of this Agreement by either party hereto which remains uncured after
thirty (30) days written notice by the non-breaching party to the
breaching party, or if such breach cannot be cured within said thirty
(30) day period, then the non-breaching party shall have the right to
terminate this Agreement by delivery of written notice to the other
party in the manner provided by this Agreement.
** CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4.06. If CAREXPRESS fails to pay within ten (10) days of receipt of billing,
FA may notify CAREXPRESS in writing of such failure to pay and issue
warning to CAREXPRESS that if payment in full for all previously billed
amounts is not received within fourteen (14) days from date of notice,
the Agreement may be terminated. If CAREXPRESS fails to pay in full all
previously billed invoices within the fourteen- (14) day period
following notification, FA may notify CAREXPRESS of such failure to pay
and immediately terminate this Agreement. Termination of the Agreement
does not relieve CAREXPRESS of the obligation to pay all moneys due.
5. COMMUNICATIONS
FA will cooperate with CAREXPRESS in the preparation and dissemination of the
materials required by Section 1.05 above. CAREXPRESS shall not use the First
Access(TM), ANY DOCTOR(TM) or the Network(s)'s trademarks, service marks or
tradenames in any advertisement or publication without the written consent of
FA. CAREXPRESS will submit all communications materials, including but not
limited to, I.D. cards, enrollment, and marketing materials, to FA for written
approval before distribution to any client or Cardholder.
6. NOTICES
Any notice required or given under this Agreement shall be in writing and
delivered in person, sent by certified or registered mail, return receipt
requested, or next day mail or courier, and addressed to the other party at the
address set forth below, or at such other address as the party may designate in
writing. Notices delivered in person or sent by next day mail or courier shall
be deemed to have been given on the day actually received. Notices sent by
registered or certified mail shall be deemed to have been given on the earlier
of the third day after the date such notice was sent or the day actually
received; provided however that if such day falls on a weekend or legal holiday,
receipt shall be deemed to occur on the business day following such weekend or
legal holiday.
International Health Partners, Inc.
120 Gibraltar Road
Suite 107
Horsham, PA. 19044
Attn: Dr. Dennis Bowers, CEO
First Access, Inc.
25108 Marguerite Parkway, # 214
Mission Viejo, CA 92691
Attn: Kimberly Darling, President
7. ASSIGNMENT
The rights and duties of either party shall not be transferred or assigned in
whole or in part without the prior written consent of the other; provided
however that either party may assign this Agreement to a present or future
affiliate, subsidiary or successor in interest who succeeds to all or
substantially all of the assets and operations of such party.
8. FORCE MAJEURE
Neither party shall be responsible for delays or failures of performance
resulting from acts beyond the control of such party. Such acts include, but are
not limited to, acts of god, strikes, lockouts, riots, acts of war, epidemics,
government regulations imposed after the effective date hereof, fire,
communication line failures, power failures, earthquakes or other disasters.
9. OWNERSHIP
CAREXPRESS acknowledges that all right, title and interest in and to the
proprietary concepts, methods, techniques, processes, adaptations and ideas that
pertain to FA's First Access patent pending repricing system or any derivative
work associated therewith (collectively, "Proprietary Information") shall remain
with FA. CAREXPRESS acknowledges that the Proprietary Information was developed
or acquired by FA through the expenditure of substantial time and expense, and
CAREXPRESS agrees, that without the prior written consent of FA, it shall not
copy or otherwise reproduce, misappropriate, distribute, disclose, transfer or
use any Proprietary Information except as expressly contemplated in this
Agreement.
10. RESPONSIBILITY TO AND RIGHTS OF THIRD PARTIES
CAREXPRESS acknowledges and agrees that (a) FA does not practice medicine or any
other profession, (b) FA does not control the provision of services to
CAREXPRESS' Cardholders, (c) FA has no responsibility for the care and treatment
of CAREXPRESS' Cardholders rendered by preferred providers in the Network(s),
such care and treatment being the sole responsibility of the preferred providers
in the Network(s), and (d) FA has no responsibility for any activities related
to the credentialing of preferred providers in the Network(s).
11. COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which taken together shall constitute one
and the same instrument.
12. SEVERABILITY
Should any provision of this Agreement be adjudged unlawful or invalid by any
court of competent jurisdiction, the remaining provisions shall remain in full
force and effect.
13. ATTORNEY'S FEES
In the event of any action or threatened action between the parties to enforce
the terms of this Agreement, in addition to any other relief it may be awarded,
the prevailing party shall be entitled to be reimbursed by the other party for
the prevailing party's costs incurred in connection therewith, including but not
limited to legal and expert witness fees.
14. ARBITRATION
14.01. Any controversy, dispute or claim arising out of or in connection with
this Agreement shall be resolved, upon the request of either party
hereto ("Request"), by final and binding arbitration ("Arbitration")
conducted in Orange County, California, in accordance with the
provisions hereof. Except as otherwise provided herein, the Arbitration
shall be commenced and conducted in accordance with the Rules of
Practice and Procedures of the Judicial Arbitration and Mediation
Services, Inc. ("JAMS") as in effect at the time ("JAMS Rules"). The
exact time and location of the Arbitration proceeding will be
determined by the arbitrator. The parties shall jointly select one
arbitrator from the Orange County JAMS panel of arbitrators. If the
parties are unable to agree upon an arbitrator within sixty (60) days
of the Request for Arbitration, the arbitrator shall be selected in
accordance with the JAMS Rules. All testimony in the Arbitration
proceeding shall be given under oath.
14.02. Commencement of any Arbitration pursuant hereto shall be subject to the
same statutes of limitations as would apply if the matter were to be
filed in a court of law or equity.
14.03. The arbitrator shall have the power to grant all legal and equitable
remedies provided by California or federal law, provided however, that
the arbitrator (a) shall not have the power to award punitive or
exemplary damages and (b) shall be bound by applicable statutory and
case law in rendering a decision. The decision of the arbitrator shall
be in writing and shall include written findings of fact and
conclusions of law. The decision of the arbitrator shall be final and
unreviewable for any error of any kind, except (i) if the Arbitration
was not conducted in accordance with the provisions hereof or the JAMS
Rules (except to the extent the JAMS Rules are not provided for
herein), or (ii) for those reasons set forth in California Code of
Civil Procedure Section 1286.2, provided, however, that the
arbitrator's decision shall not be subject to review because of any
claimed error in interpreting, following or applying applicable law in
deciding the matter subject to the Arbitration.
14.04. Judgment upon any award rendered by the arbitrator may be entered in
any court having jurisdiction thereof and the award may be judicially
enforced.
15. GOVERNING LAW
The laws of the State of California shall govern this Agreement, without giving
effect to its conflicts of law provisions.
16. CONFIDENTIALITY AND NON-COMPETITION
16.01. Each party may, in the course of the relationship established by this
Agreement, disclose to the other party in confidence non-public
information concerning such party's earnings, volume of business,
methods, systems, practices, plans and other confidential or
commercially valuable proprietary information, including any
confidential and proprietary information of third parties which FA is
contractually obligated to protect, such as information regarding
negotiated contracted rates of preferred providers in the Network(s)
and information related to the methodology of re-pricing claims
hereunder (collectively, "Confidential Information"). Each party
acknowledges that the disclosing party (or if applicable, a third party
to whom FA is contractually obligated) shall at all times be and remain
the owner of all Confidential Information disclosed by or on behalf of
such party, and that the party to whom Confidential Information is
disclosed may use such Confidential Information only in furtherance of
the purposes and obligations of this Agreement. The party to whom any
Confidential Information is disclosed shall use its best efforts,
consistent with the manner in which it protects its own Confidential
Information, to preserve the confidentiality of any such Confidential
Information which such party knows or reasonably should know that the
other party (or if applicable, a third party to whom FA is
contractually obligated) deems to be Confidential Information. Neither
party shall use for its own benefit, or disclose to third parties any
Confidential Information of the other party without such other party's
written consent.
16.02. CAREXPRESS agrees that, during the term of this Agreement and for a
period of eighteen months after the termination thereof by either
party, CAREXPRESS shall not influence or seek to influence, directly or
indirectly, any of FA's customers, business partners, vendors and
affiliates to avoid, discontinue or limit such entity's business
relationship with FA, (2) enter into any business relationship with
FA's business partners, vendors and affiliates who are involved with
FA's patent pending telephonic repricing services or whose names and
roles may be disclosed to CAREXPRESS under this Agreement.
FA agrees that, during the term of this Agreement and for a period of
eighteen months after the termination thereof by either party, FA shall
not influence or seek to influence, directly or indirectly, any of
CAREXPRESS' customers, business partners, vendors and affiliates to
avoid, discontinue or limit such entity's business relationship with
CAREXPRESS, (2) enter into any business relationship with CAREXPRESS'
business partners, vendors and affiliates who are involved with
CAREXPRESS' contracted card services or whose names and roles may
services or whose names and roles may be disclosed to FA under this
Agreement.
16.03. This Agreement and the terms hereof shall remain confidential and
neither party shall disclose this Agreement or the terms hereof to any
other party, except as required by law.
17. ARTICLE HEADINGS
The Article headings included in this Agreement are for the convenience of the
parties only and shall not affect the construction or interpretation of this
Agreement.
18. ENTIRE AGREEMENT
This Agreement contains the entire agreement and understanding of the parties'
subject matter hereof and shall supersede any and all prior and concurrent
agreements, whether oral or written, between the parties regarding the subject
matter hereof. The parties acknowledge and agree that neither of them has made
any representations with respect to the subject matter of this Agreement, or any
representation inducing the execution and delivery hereof except such
representations as are specifically set forth herein, and each of the parties
hereto acknowledges that it has relied on its own judgment in entering into the
same.
19. NO AGENCY
No agency is created by the terms of this Agreement, and CAREXPRESS shall have
no authority to obligate FA in any way, contractually or otherwise.
20. AUTHORITY
Each person signing this Agreement on behalf of a party hereto represents that
he or she is duly authorized to do so on behalf of such party and that such
party has taken all necessary action in order to be bound by the terms hereof.
In witness whereof, this Agreement is executed this 18th day of September, 2002.
International Health Partners, Inc.
By: /s/ R. Dennis Bowers
---------------------------------------------
Dr. R. Dennis Bowers:
Title: CEO
First Access, Inc.
By: /s/ Kimberly Darling
---------------------------------------------
Kimberly Darling
Title: President
EXHIBIT A
CAREXPRESS agrees to satisfy the following requirements for each Cardholder who
is entitled to access the Network(s) and to receive FA's repricing services
pursuant to this Agreement:
1. CAREXPRESS shall provide each new member with identification cards containing
the appropriate toll-free number which card must be presented to the Network(s)
provider prior to the time that healthcare services are rendered to the
Cardholders or dependents;
2. CAREXPRESS shall communicate with and educate its Cardholders concerning
applicable procedures to be followed in connection with access to FA's repricing
services hereunder.
Exhibit B
Provider Networks
Following are the summary descriptors of each of the PPO networks that comprise
the FA networks that CARExpress will be leasing from FA. These networks will be
amalgamated into an overall data base on the CARExpress website, allowing
CARExpress members to identify participating providers, their location and
specialty descriptors.
PPO Name #Hospitals #doctors #ancillary facilities
- --------------------------------------------------------------------------------
1. PPO NEXT 3,700 337,307 3,800
2. International Med Care 4,000 350,000 75,000
EXHIBIT C
MEMBER TERMS AND CONDITIONS
1. Member understands that is not an insurance plan or program. No
payments to medical providers or members will be made by CAREEXPRESS
savings plan.
2. CAREEXPRESS provides savings to its members on medical services through
a number of medical networks. In order to access these networks and the
related discounts, member or member's dependents must pay the medical
providers promptly. Payments on all medical bills are due and payable
at the time of service. The member has no out-of-network benefits and
must use a contracted provider in order to receive any benefits.
3. As a service to members, CAREEXPRESS company Medical savings program
may provide network rate information to medical providers under this
program. If the information provided results in an underpayment to a
medical provider, member agrees to pay the medical provider for any
shortages within ten (10) days of notice to such member of the
inappropriate reimbursement. If the information provided results in an
overpayment to a medical provider, CAREEXPRESS Company will assist
member to the best of its ability to collect any such amount from the
appropriate party.
4. Neither CAREEXPRESS Company nor any of its affiliates, nor any network
accessed shall be liable for any payment to a provider accessed under
the CAREEXPRESS company program, or any refusal of participating
providers to accept the network rates offered under this program.
CAREEXPRESS company savings, its affiliates or any network accessed is
not an insurer, guarantor or underwriter of the responsibility or
liability of Member for Member's or Member's dependent's medical care
or any other goods or services provided to Member or Member's
dependents.
5. The providers listed in this directory are subject to change without
notice. Member may call CAREEXPRESS company provider referral line at
800-769-1259 for current provider information.
6. Participating Medical Providers are independent contractors and,
CAREEXPRESS Company and its affiliates and its contracted networks are
not responsible for health care provided or the omission of the
provision of health care by any provider. CAREEXPRESS Company does not
practice medicine or in any manner interfere with or participate in the
provider-patient relationship. All health care decisions are between
the patient and a provider. The selection of a provider is the
obligation and decision of the patient and is not based upon the
credentialing or any recommendation by CAREEXPRESS Company, its
affiliates or its contracted networks.
7. CAREEXPRESS company Medical savings reserves the right to terminate any
member for failure to pay a medical provider accessed under the
CAREEXPRESS company Medical savings program under the terms provided.
8. Members may cancel their CAREEXPRESS company Medical savings program at
any time upon written notice to the company and return of the ID cards.