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EXHIBIT 10.12
AMENDMENT
RISK CONTRACT MANAGEMENT AGREEMENT
BY AND BETWEEN
ELMHURST PHYSICIAN HOSPITAL ORGANIZATION, LLC.
&
NORTH AMERICAN MEDICAL MANAGEMENT-ILLINOIS, INC.
MAY, 2000
The Risk Contract Management Agreement between Elmhurst Physician Hospital
Organization, LLC (ELMCARE), an Illinois limited liability company, and North
American Medical Management-Illinois, Inc. (NAMM), an Illinois general business
corporation, entered into on May 1, 1995, is hereby amended as follows:
ARTICLE I - DEFINITIONS
1.8 "Territory" - Omitted in its entirety.
ARTICLE 2 - RESPONSIBILITIES OF NAMM
2.3 (b) Allocation of Funds
ELMCARE shall, in good faith and based upon general parameters developed in
consultation with NAMM and approved by ELMCARE, allocate capitated payments
negotiated with third party payors under the Risk Contracts (to the extent that
the third party payor has not already allocated the capitated payments) among
the various ELMCARE contracting providers. In addition, ELMCARE shall, in good
faith and based upon general parameters developed in consultation with NAMM,
develop internal "risk pools" and withhold pools" to create incentives for
providers to efficiently provide services under the Risk Contracts (the "NAMM
Pools"). The NAMM pools need not coincide with or be identical to risk pools or
withhold arrangements established under the Risk Contracts. In creating the
amounts to fund such pools, NAMM shall subtract from the capitated payments
received under the Risk Contracts: (a) an amount determine by NAMM as the
aggregate capitated rates to be paid by ELMCARE to providers; and (b) the
Administrative Expense Charge due to NAMM under Section 4.3 below.
2.3 (g) Claims Payment.
NAMM will pay claims to be in compliance with Illinois prompt pay laws. Failure
to meet prompt pay requirements may result in interest penalties, as deemed by
Illinois prompt pay laws. If such penalties are incurred due to NAMM's lack of
payment of eligible claims, NAMM will pay 100% of the penalty cost, to be
identified by NAMM and deducted from NAMM's monthly administrative fee, or in
paid in a method mutually agreed to by NAMM & ELMCARE.
2.3 (m) - Omitted in its entirety.
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2.3 (o) - Licensure and Accreditation
NAMM shall assist and cooperate fully with ELMCARE and its contract providers
and shall provide such information in the possession of NAMM that is reasonably
necessary for ELMCARE and its contract providers to satisfy applicable licensure
and accreditation standards that are imposed upon ELMCARE by accrediting bodies
or by payors, with which ELMCARE contracts if such payor imposes standards upon
ELMCARE, including but not limited to National Committee on Quality Assurance
("NCQA) and Utilization Management Standards of the American Accreditation
Healthcare Commission (URAC).
2.6 - Medical Advisory - Omitted in its entirety.
ARTICLE 3 - REVENUES AND EXPENSES
Article omitted in its entirety.
ARTICLE 4 - COMPENSATION FOR ADMINISTRATIVE SERVICES
4.2 - Development Fee - Omitted in its entirety.
4.3-
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Administrative Expense Charge
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Professional Full Risk
Risk Contracts Contracts
- --------------------------------------------------------------------------------
Commercial Payors - 1st Yr $4.50 pmpm $6.51 pmpm
- 2nd Yr $4.60 pmpm $6.65 pmpm
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Medicare To be determined To be determined
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4.4 - Adjustment to Administrative Expense Charge - Omitted in its entirety.
6.1 - Term; Renewal.
Unless sooner terminated pursuant to this Article 6, the term of this Agreement
shall be two (2) years. This Agreement shall automatically renew at the end of
the initial term, and each subsequent term, for an additional one (1) year term,
unless either party provides the other party with written notice of its intent
to terminate the Agreement at least ninety (90) days prior to the end of the
then current term.
6.7 - Termination Due to Termination of Fritch. - Omitted in its entirety.
ARTICLE 10 - EXCLUSIVITY
10.1 - Exclusive Relationship with NAMM - Omitted in its entirety
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10.2 - Exclusivity Relationship with ELMCARE.
In the event that ELMCARE rejects or decides not to enter into a Risk Contract
with a third party payor and an investor in ELMCARE elects to pursue such Risk
Contract with the third party payor as permitted by the agreement between such
investor and ELMCARE, then NAMM may provide to the investor in ELMCARE with
respect to such Risk Contract services similar to those provided hereunder;
provided however, that the cost of providing such services shall be charged to,
and born entirely by, such investor in ELMCARE.
16.2 - Notice.
All notices, requests, demands and other communications required or permitted to
be given hereunder shall be sent by (a) certified mail, return receipt requested
or (b) facsimile to the parties or (c) commercial carrier that provides a signed
receipt verifying actual delivery at the address set forth below. Such notices
shall be deemed given seven (7) business days after being deposited in the
United States mail or when receipt acknowledged, if sent by facsimile:
If to ELMCARE: ELMCARE, LLC
855 Church Court
Elmhurst, Illinois 60126
Attn: Executive Director
Facsimile: 630-993-5619
If to NAMM: North American Medical Management -Illinois Inc
4415 West Harrison Street, Suite 300
Hillside, Illinois
Attn: President
Facsimile: 630-432-4077
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to be
effective as of May 1, 2000.
ELMHURST PHYSICIAN HOSPITAL NORTH AMERICAN MEDICAL
ORGANIZATION, L.L.C. MANAGEMENT - ILLINOIS, INC.
BY: /s/ Denise L. Meyers By: /s/ David Kanzler
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Denise L. Meyers David Kanzler
Title: Executive Director Title: Regional Vice President
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Date: May 22, 2000 Date: June 15, 2000
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