EXHIBIT 10.3
HEALTH INSURANCE CONTRACT
NO. 03-021G FOR THE
SOUTH WEST HEALTH REGION
BETWEEN
PUERTO RICO HEALTH INSURANCE ADMINISTRATION
AND
TRIPLE S, INC.
This Amendment entered into this 1st DAY OF JULY, 2005, at San Juan, Puerto
Rico, by and between PUERTO RICO HEALTH INSURANCE ADMINISTRATION, a public
instrumentality of the Commonwealth of Puerto Rico, organized under Law 72
approved on September 7, 1993, hereinafter referred to as the "ADMINISTRATION",
represented by its Executive Director, Nancy Vega Ramos and TRIPLE S, INC. a
domestic corporation duly organized and doing business under the laws of the
Commonwealth of Puerto Rico, with employer social security number ###-##-####,
hereinafter referred to as the "INSURER" represented by its Chief Executive
Director, SOCORRO RIVAS.
WITNESSETH
In consideration of the mutual covenants and agreements hereinafter set forth,
the parties, their personal representatives and successors, agree as follows:
WHEREAS: On June 13th, 2002, the ADMINISTRATION and INSURER entered into
Contract No. 03-021 for the South West Health Region, a three-year contract with
an effective date of July 1st, 2002 (the "Contract") subject to annual
renegotiations of the premiums. Said contract provides health insurance coverage
to all enrollees in and within the SOUTH WEST HEALTH AREA/REGION, composed of
the municipalities of ADJUNTAS, GUANICA, GUAYANILLA, JAYUYA, PENUELAS, PONCE AND
YAUCO
WHEREAS: Pursuant to an executive decision of the Governor of Puerto Rico,
Anibal Acevedo Vila, the Health Reform Program Plan is presently undergoing a
profound assessment that is being conducted by the designated EVALUATING
COMMISSION FOR THE HEALTH REFORM PROGRAM PLAN, in order to reevaluate
significant conceptual, organizational and operational changes in the government
health infrastructure and service delivery system in place.
WHEREAS: In view that the Commission's final report with the resulting findings
and recommendations to be implemented in the Health Reform Program Plan, will
not be final until August 2005, the ADMINISTRATION'S Board of Directors with the
Governor's approval has determined to extend the present contract term for an
additional one (1) year period.
WHEREAS: Considering that the contract termination date is due on June 30th,
2005 and pursuant to the terms of Article XXXVIII, the ADMINISTRATION hereby in
the best interest of the Commonwealth of Puerto Rico and the beneficiaries it
serves, has agreed with the INSURER to amend the contract only with respect to
the following Articles as provided herein.
HENCEFORTH: The Contract is hereby amended to read as follows:
ARTICLE I
DEFINITIONS
CONTRACT TERM: The contract term is for (4) four consecutives twelve months
periods after its effective date July 1st, 2002 until June 30, 2006.
Notwithstanding the aforesaid, the contract may be terminated at the
ADMINISTRATION's option, on December 31, 2005 with not less than (60) sixty days
prior notification to Insurer.
ARTICLE XVI
FINANCIAL REQUIREMENTS
ARTICLE XVI, PARAGRAPH (6) IS AMENDED AND SUBSTITUTED TO READ AS FOLLOWS,
EFFECTIVE, AS OF AUGUST 1, 2005:
6. The INSURER will be paid a fixed administrative cost fee and profit
of SIX DOLLARS WITH THIRTY CENTS ($6.30) pmpm included in the total
premium rate made by the Administration. Further, the INSURER's
aggregated net earnings (as defined and considering all INSURER's
Health Areas/Regions contracted with the ADMINISTRATION) in excess
of 2.5% of the total aggregated earned premium in this contract year
period will be shared with the ADMINISTRATION. The ADMINISTRATION
share apportionment of the earnings shall be 75% and the INSURER
share shall be 25%.
ARTICLE XVIII
PAYMENT OF PREMIUMS
IN ARTICLE XVIII, PARAGRAPHS (3) AND (5) ARE AMENDED AND SUBSTITUTED TO READ AS
FOLLOWS:
3. The monthly premiums for the months comprised within the contract term and
covered by this contract are as follows:
a) For all beneficiaries including all those who are sixty-five (65)
years and older who are Medicare beneficiaries with Part A or Parts
A
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and B and those who are sixty-five years and older who
are not Medicare recipients until July 31, 2005:
1) PER MEMBER PER MONTH RATE (PMPM) (BENEFICIARY) ESTABLISHED AT
SIXTY THREE DOLLARS ($63.00).
b) For all beneficiaries including all those who are sixty-five (65)
years and older who are Medicare beneficiaries with Part A or Parts
A and B and those who are sixty-five years and older who are not
Medicare recipients from August 1, 2005 to September 30, 2005:
1) PER MEMBER PER MONTH RATE (PMPM) (BENEFICIARY) ESTABLISHED AT
SIXTY FIVE DOLLARS WITH NINETY CENTS ($65.90).
c) For all beneficiaries including all those who are sixty-five (65)
years and older who are Medicare beneficiaries with Part A or Parts
A and B and those who are sixty-five years and older who are not
Medicare recipients from October 1st 2005 through June 30, 2006.
1) PER MEMBER PER MONTH RATE (PMPM) (BENEFICIARY) ESTABLISHED AT
SIXTY FIVE DOLLARS WITH NINETY CENTS ($65.90).
5. The INSURER shall not, at any time, increase the rate agreed in the
contract nor reduce the benefits agreed to as defined in Addendum I of
this contract.
Notwithstanding the aforesaid, the INSURER acknowledges that the
ADMINISTRATION reserves the right to modify any of the contract terms, to
the extent of reducing the agreed premium rates in order to reduce any
benefits coverage under Addendum I, in the event the ADMINISTRATION is not
afforded the necessary and sufficient state or federal funds required to
subsidized all or part of the health plan's benefits hereby covered.
Further, the aforementioned stipulated rates (established in Article XVIII
of this amendment) assume all beneficiaries including all those who are
sixty-five (65) years and older who are Medicare beneficiaries with Part A
or Part A and B, and those who are sixty-five (65) years and older who are
not Medicare recipients are enrolled with the INSURER. Should any
initiative related to the Medicare Modernization Project (as defined
herein) preclude enrollment of any portion of the Medicare Population with
the INSURER, said aforementioned rate will be subject to modification.
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ARTICLE XX
EDUCATION AND PREVENTIVE PROGRAM
IN ARTICLE XX PARAGRAPHS (1) THROUGH (12) ARE RESTATED, AMENDED AND SUBSTITUTED
TO READ AS FOLLOWS, EFFECTIVE AS OF AUGUST 1, 2005:
1. The INSURER will provide the component of health services as
described and detailed in this Article XX for the effective
implementation of the Health Plan's preventive medicine services.
The health services to be delivered by INSURER will be implemented
in accordance to the Department of Health policies, protocols and
guidance on lifestyle, HIV/AIDS, drug abuse and mother and child
care as established. The INSURER through the delivery of service
component will address, analyze and implement measures to provide
effective services seeking to reduce the principal causes of death
in the contracted region.
2. The INSURER secondary and tertiary Preventive Program activities
component to be implemented will address, analyze and implement
measures to provide effective clinical activities to address and
reduce the specific causes of morbidity and mortality in the
Area/Region.
3. The INSURER will develop and effectively implement a case management
system in order to monitor high risk cases and attend to the covered
health care needs of the beneficiaries and dependents within said
category.
a. A case management program which initially will be under
the responsibility of a nurse. Case management will not
be limited to the physician's offices or determined
center. Coordination of the services provided is
required within the community and the beneficiary's
home, if necessary.
4. The responsibilities of the INSURER under the Disease Management
Program will include the following:
a. A program developed by the INSURER shall develop
standardized procedures to address major public health
conditions such as ASTHMA, DIABETES, HYPERTENSION AND
CONGESTIVE HEART FAILURE. This program shall include
identification, treatment, protocols / guidelines and
surveillance / monitoring. Quarterly reports will be
required detailing the results of the disease management
programs.
5. The INSURER develop and effectively implement a Prenatal Care
Program which will include, but not limited to:
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a. The INSURER will assure that all pregnant women are
screened for alcohol using the following Interview
Instrument titled "TWEAK" from Department of Health
Guidelines.
b. The INSURER will assure that all pregnant women will
obtain counseling for the HIV test. Prenatal care and
HIV testing and services will continue to be covered
benefits under this contract.
c. The INSURER will assure that all pregnant women,
following an HIV test positive results are allowed to be
treated following the Department of Health's guidelines
for the utilization of ZDV in pregnant women and
neonatal infants to reduce the risk of mother-infant HIV
transmission.
d. The INSURER will assure the increase of pregnant
beneficiaries enrolled in prenatal care in the first
trimester.
e. The INSURER will assure that pregnant women classified
as high risk will be referred to the Case Management
Program.
f. The INSURER will provide the ADMINISTRATION quarterly
reports detailing all services rendered to mother and
child, classified by age groups and listing the number
of pregnant women that have: (i) received prenatal care
on each month during the reporting period; (ii)
counseled as to HIV testing; (iii) referred to the HIV
Treatment Programs.
6. The INSURER will develop and effectively implement a Providers
Education Program. It is required that all primary care providers
(pcp) receive 25 hours of orientation and education on managed care
topics including documentation, quality and other health topics of
interest.
a. The INSURER agrees to comply and assure that all
participating providers will comply with the federal and
local laws referred in Article XV paragraph (11) (g) of
this contract.
b. The INSURER will assure the submission by the
participating provider of all the protocols and formats
requested by the Department of Health, Department of the
Family, Department of Education and Department of
Justice, as contained in the RFP formats.
7. The INSURER will develop and effectively implement incentive-based
programs whereby the providers are motivated toward compliance with
all
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requirements of the Health Plan's Preventive Medicine Services, such
as EPSDT, Immunizations, Prenatal Care, Preventive Annual
Examination, Mammograms, PAPS, PSA, SIGMO and other related
services.
a. The INSURER will assure that all providers comply with
EPSDT (Early Periodic Screening Diagnosis and Treatment)
Program and the Guidelines for Adolescent Preventive
Services (GAPS) from the American Medical Association.
8. The ADMINISTRATION shall evaluate the Preventive Services through
Department of Health guidelines, HEDIS and the other applicable
performance standards.
9. The INSURER will provide the ADMINISTRATION quarterly reports
detailing the services rendered by INSURER under the Preventive
Services as established herein.
10. The ADMINISTRATION shall have the right to require any special
report and audit the compliance with these requirements as needed.
Non-compliance shall be a determining factor in non-renewal of this
contract or breach there of as defined in Article XX.
11. The INSURER will implement the ADMINISTRATION's Universal Plan for
Health Education and Preventive Services ("Plan Universal de
Educacion y Prevencion", for its name in Spanish, or the "Universal
Plan"); for the component of the health services as described as
detailed in this Article XX. The Plan also includes requirements on
performance measures and performance improvement projects on Disease
Management Activities listed on the Universal Plan description.
12. The primary preventive, health education and community outreach
activities of the Health Plan's Preventive Program, which emphasize
in disease prevention and health promotion, shall be the
responsibility of the Department of Health. In collaboration with
the Department of Health, the Insurer will cooperated with the
Department of Health efforts in the development of surveillance
methodology to identify compliance with this program.
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ARTICLE XXI
MENTAL HEALTH PROGRAM
DIRECT PROVIDERS DEMONSTRATION PROJECT AND SMART CARD ROLL-OUT
MEDICARE MODERNIZATION PROJECT INITIATIVE
IN ARTICLE XXI, PARAGRAPH 4 IS INCORPORATED TO READ AS FOLLOWS:
4. MEDICARE MODERNIZATION PROJECT INITIATIVE
4.1 The INSURER acknowledges the present initiatives and engagement
efforts the ADMINISTRATION is conducting for the evaluation of the
Health Plan's total infrastructure for health services delivery.
This acknowledgement entails the INSURER's recognition and
acceptance of the ADMINISTRATION intended purpose to substantially
modify or terminate the present Health Plan coverage for its
Medicare beneficiaries, among other changes, to comply accordingly
with new terms and conditions mandated under the Medicare, Medicaid
Program to the extent these modifications are required for
enhancing, flexibilizing and affording the best comprehensive and
financial affordable coverage under Law 72 to the Medicare
population within Commonwealth's budget limitations.
4.2 The INSURER shall collaborate and assist the ADMINISTRATION as
deemed necessary to ensure a proper transition of services to its
beneficiaries in the event the coverage and access of services of
its Medicare population is modified or terminated as a result of the
Medicare Modernization Act legislative and regulatory developments
taking place or that may be implemented during this contract term.
ARTICLE XXVIII
EFFECTIVE DATE AND TERM
IN ARTICLE XXVIII, PARAGRAPHS (1), (3) ARE AMENDED AND SUBSTITUTED, PARAGRAPH
(5) AND (6) ARE INCORPORATED, TO READ AS FOLLOWS:
1. This contract shall be in effect starting at 12:01 AM, Puerto Rico
time on July 1, 2002, the first day that coverage begins and payment
of the premium is due until either June 30th, 2006, or otherwise at
the Administration's option until December 31, 2005.
3. This contract may be extended, or modified by the ADMINISTRATION,
upon acceptance by INSURER, for any subsequent period of time if
deemed in the best interest of the beneficiaries, the ADMINISTRATION
and the Government of Puerto Rico.
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5. The ADMINISTRATION hereby reserves its right to set aside the terms
set forth on paragraph (1) and either, terminate this contract on
December 31, 2005, with no less than (60) sixty days prior notice,
in the best interest of the Government of Puerto Rico.
6. In the event the ADMINISTRATION determines to exercise the option to
terminate this contract, or in the event the contract term expires
without the parties reaching an agreement, or either, the INSURER
determines not to continue its participation under the health plan,
a two (2) months transition period will be guaranteed by the
INSURER, which will commence after the effective date of
termination, or contract expiration date or the non-renewal
notification date to the ADMINISTRATION, as applicable with the
corresponding payment by the ADMINISTRATION to INSURER of premiums
for said transition period.
THE PRESENT AMENDMENTS TAKE PRECEDENCE AND SHALL PREVAIL OVER ANY REMAINING
SECTIONS AND ARTICLES OF THE CONTRACT WHICH ARE MAINTAINED BUT COULD CONFLICT
WITH THESE AMENDMENTS.
This being the amendment that the parties have agreed to, each party places its
initials at the margin of each of the pages contained herein, and affixes below
its signature. In San Juan, Puerto Rico, on this 10 DAY OF OCTOBER, 2005.
/s/
- --------------------------------------------------
NANCY VEGA RAMOS, MHS, HIA, MHP
EXECUTIVE DIRECTOR
PUERTO RICO HEALTH INSURANCE ADMINISTRATION
/s/
- --------------------------------------------------
SOCORRO RIVAS
CHIEF EXECUTIVE OFFICER
TRIPLE-S, INC.
/s/
- --------------------------------------------------
LUIS A. MARINI, DMD
CHIEF EXECUTIVE OFFICER
TRIPLE-C, INC.
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