CHRONIMED INC.
EXHIBIT 10.24
PHARMACY PARTICIPATION AGREEMENT WITH AETNA HEALTH MANAGEMENT, INC.
SPECIALTY PHARMACY
MAIL SERVICE VENDOR AGREEMENT
This Agreement is entered into by and between Aetna U.S. Healthcare,
Inc. on behalf of itself and its Affiliates (as defined below) (hereinafter
"Company") and CHRONIMED, INC. (hereinafter "Pharmacy"), to become effective on
May 1, 2000 ("Effective Date").
WHEREAS, Company contracts with health care providers to render
services to individuals entitled to receive health care services from or through
a Plan (as defined below); and
WHEREAS, Pharmacy wishes to contract with Company to provide
pharmaceutical services to said individuals on the following terms and
conditions;
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants, promises and undertakings herein and intending to be legally bound
hereby, the parties agree as follows:
1.0 PHARMACY SERVICES
1.1 Provision of Covered Services. Pharmacy shall provide Covered Services to
Members within the scope of Pharmacy's qualifications and licensure and
in accordance with generally accepted professional standards and the
terms of this Agreement. A detailed schedule of Covered Services covered
under this Agreement is attached as the SERVICES SCHEDULE and by
reference is made a part of this Agreement. Covered Services will be
provided pursuant to either a currently dated prescription order or in
response to a telephone request by a properly identified physician,
optometrist, physician assistant (where allowed by state law) or dentist.
Pharmacy shall provide Covered Services to those Members whose
eligibility is verified through the Company on-line claims adjudication
system or those Members who submit a current fully executed Company
designated enrollment form. This Agreement excludes all Internet Pharmacy
Services (as hereinafter defined).
1.2 Non-Discrimination. Pharmacy shall provide Covered Services to Members
without regard to the health status or health care needs of such Members.
Pharmacy shall not differentiate or discriminate in the provision of
Covered Services to Members on the basis of race, gender, creed,
ancestry, lawful occupation, age, religion, marital status, sexual
orientation, mental or physical disability, color, national origin, place
of residence, health status, source of payment for services, cost or
extent of Covered Services required, status as Members, or any other
grounds prohibited by law or this Agreement. Pharmacy shall provide
Covered Services to Members: (a) in no less than the same manner and in
accordance with at least the same standards as offered to Pharmacy's
patients who are not Members; and (b) in accordance with at least the
same standard of practice, care, skill and diligence customarily used by
similarly situated pharmacies at the time at which such services are
rendered.
1.3 Referrals to Vendors. Upon notice from Company that it has contracted
with a vendor of pharmaceuticals for specified Covered Services in
accordance with the applicable Plan, Pharmacy shall refer Members needing
such services to the specified vendors for Covered Services provided by
such vendors.
1.4 Individual Pharmacy Obligations. Pharmacy agrees that it and, if
applicable, each of its individual pharmacies shall comply with the
following obligations:
(a) cooperate with Company's Audit Unit and its policies, including
access by auditors to original prescriptions, and remit
overpayments identified during the course of an audit;
(b) provide all prescription drugs and supplies which are Covered
Services, including prescription drugs and supplies requiring
special order, except as referenced in section 1.3;
(c) compound prescriptions that are usually available at community
pharmacies and submit a claim for any compounded prescriptions via
the on-line claims adjudication system at the agreed upon
reimbursement terms set forth in the COMPENSATION SCHEDULE or as
otherwise directed by Company;
(d) provide all information required under the Omnibus Budget
Reconciliation Act ("OBRA"), 42 U.S.C. ss. 1396r-8(g)(1990), and
state law regarding utilization review and prescription drug
counseling (Prospective Drug Use Review Program) to Member or
Member's representative prior to release of the prescription to
Member or Member's representative;
(e) dispense and mail clean prescription drug orders within an average
of two (2) business days after receipt of prescription, excluding
holidays and weekends;
(f) dispense any quantity of prescription drugs as prescribed,
including any minimal quantities, up to a thirty (30) day supply
or as defined by the applicable Plan design;
(g) fill prescriptions with Generic equivalents, as permitted by
applicable law or regulation of the dispensing state which governs
the operation of such pharmacy and as defined in the Plan;
(h) not fill prescriptions:
(i) more than twelve (12) months after issuance for
non-controlled substances,
(ii) more than six (6) months after issuance for controlled
substances, or
(iii) if prohibited by applicable law or regulation;
(i) not refill a prescription unless, when the refill request is
received, at least fourteen (14) days prior to when the supply of
the prescription should have been consumed if taken as directed;
(j) provide pharmacist consultation services to Members through a
toll-free telephone number;
(k) send all prescriptions postage prepaid to the Member and
accompanied by product information and accessory warning labels,
where appropriate and required by law;
(l) maintain and utilize patient profiles as agreed upon by Company
and Pharmacy or as required by applicable state law;
(m) guarantee delivery of all orders;
(n) respond promptly to all inquiries by a Member as required in the
PARTICIPATION CRITERIA SCHEDULE, attached hereto and made a part
hereof;
(o) make arrangements for Members to immediately access prescription
items in urgent situations, including but not limited to
circumstances such as Pharmacy's shipment of the wrong item,
damaged items, or items that are shipped but not received; and
contact mail order specialty vendors designated by Company in
those situations when Pharmacy is unable to fill a Member's
prescription and arrange for such mail order to fill such
prescription within 24 hours.
1.5 Generic Drugs. Pharmacy agrees to fill each Member's prescription with
the appropriate Generic Drug as permitted by law unless the provider
ordering the prescription specifies otherwise. Pursuant to Members'
agreements with Company, Members have authorized the substitution of
Generic Drugs for Brand Name Drugs where permitted by state law.
1.6 Performance Guarantees. Pharmacy agrees to comply with the performance
guarantees that are listed in the PARTICIPATION CRITERIA SCHEDULE.
Failure of Pharmacy to comply with such performance guarantees shall
result in financial penalties as described in such schedule. Pharmacy
shall allow Company to audit Pharmacy's compliance with such performance
guarantees upon reasonable notice. Pharmacy shall allow Company to access
original prescriptions in order to audit compliance.
2.0 REPRESENTATION
2.1 Pharmacy Representation. Pharmacy represents that (a) Pharmacy has and
shall maintain throughout the term of this Agreement all appropriate
license(s), registrations and certification(s) mandated by governmental
regulatory agencies, including without limitation DEA certification and
an unrestricted license to perform its duties in the state(s) in which
Pharmacy provides Covered Services to Members; (b) Pharmacy shall comply
with all applicable federal and state laws related to this Agreement and
the services to be provided hereunder, including but not limited to
statutes and regulations related to fraud, abuse, discrimination,
disabilities, confidentiality, self-referral, false claims and
prohibition of kickbacks; (c) Pharmacy has and shall maintain throughout
the term of this Agreement professional liability and comprehensive
liability insurance in at least the minimum amounts required by the
PARTICIPATION CRITERIA; and (d) executing and performing Pharmacy's
obligations under this Agreement shall not cause Pharmacy to violate any
term or covenant of any other arrangement now existing or hereafter
executed.
2.2 Qualified Personnel. Pharmacy also represents that it has established an
ongoing quality assurance/assessment program which shall include, but not
be limited to, credentialing of employees. Pharmacy shall supply to
Company the relevant documentation, including but not limited to internal
quality assessment protocols, state licenses and certifications, and
federal agency certifications and/or registrations upon request. Company
may audit compliance with this section upon prior notice. Pharmacy
further represents that all personnel employed by, associated or
contracted with Pharmacy (a) be licensed or certified and supervised
(when and as required by state law), and qualified by education, training
and experience to perform their professional duties, and (b) act within
the scope of their licensure or certification, as the case may be.
Company may audit Pharmacy's compliance with this section upon prior
notice.
3.0 PHARMACY COMPENSATION
3.1 Payment. Company shall, or when it is not the applicable Payor shall
notify each Payor to, pay Pharmacy for Covered Services rendered to
Members in accordance with the COMPENSATION SCHEDULE, attached hereto and
made a part hereof, which may be modified from time to time by Company.
Payments to Pharmacy for Covered Services shall be made within thirty
(30) days, or as required by law of acceptance of the pharmacy claim via
the on-line adjudication system. Payments to Pharmacy for Covered
Services shall be made within sixty (60) days, or as required by law, of
receipt of a complete, uncontested billing in the proper format submitted
to the designated claim processing center(s). Notwithstanding the
foregoing, Company shall, or when not the applicable Payor shall notify
Payors to pay for only those Covered Services for which the requirements
of section 4.1 and 4.2 were met. Company, on its behalf and on behalf of
Payors, reserves the right to perform utilization review (including
retrospective review) and to adjust or deny payment for medically
inappropriate services, admissions, or lengths of stay. Payments for
non-capitated Covered Services are subject to any and all valid and
applicable laws related to claims payment. Company reserves the right to
rebundle to primary procedure those services determined by Company to be
part of, incidental to, or inclusive of the primary procedure. Pharmacy
shall notify Company of any overpayments or payments made in error within
ten (10) business days of becoming aware of such overpayments or
erroneous payments, and shall return or arrange the return of any such
overpayments or payments made in error to Company, or to the Payor or
Member, as applicable.
3.2 Billing of Members. Under certain Plans, Members may be required to pay
Copayments, Coinsurance or Deductibles for certain Covered Services.
Pharmacy shall collect any applicable Copayments, Coinsurance and
Deductibles from Members. Copayments shall be collected at the time that
Covered Services are rendered. Except for applicable Copayments,
Coinsurance and Deductibles, Pharmacy may ▇▇▇▇ Members only in the
circumstances described below.
3.2.1 If the applicable Payor is not an HMO, Pharmacy may ▇▇▇▇ a Member
for Covered Services provided to the Member in the event that the
Payor becomes insolvent or otherwise breaches the terms and
conditions of its agreement to pay, provided that (A) Pharmacy
shall have first exhausted all reasonable efforts to obtain
payment from the Payor, and (B) Pharmacy shall not institute or
maintain any collection activities or proceed with any action at
law or in equity against a Member to collect any sums that are
owed by a Payor to Pharmacy unless Pharmacy provides at least
thirty (30) days prior notice to Company of Pharmacy's intent to
institute such an action.
3.2.2 Services that are not Covered Services may be billed to Members by
Pharmacy only if (A) the Members' Plan provides and/or Company
confirms that the services are not covered; (B) the Member was
advised in writing prior to the services being rendered that the
specific services are not Covered Services, and (c) the Member
agreed in writing to pay for such services.
Nothing in this section is intended to prohibit or restrict Pharmacy from
billing individuals who were not Members at the time that services were
rendered.
3.3 Company's Obligation to Pay. Company shall have no obligation to pay
Pharmacy for Covered Services in the event that a Payor or Member fails
to pay Pharmacy, except where Company is the underwriter of the
applicable Plan.
3.4 On-Line Edits. Pharmacy will allow all edits originating with Company's
claims processor to reach individual pharmacies. Pharmacy agrees that it
and all individual pharmacies shall respond appropriately to: (i) on-line
responses which indicate to Pharmacy that the drug in question may
adversely affect the Member's medical status; and (ii) edits regarding
utilization review programs.
3.5 Claims Submission. In order to be compensated hereunder for Covered
Services, Pharmacy agrees to submit itemized, accurate and complete
claims for Covered Services on behalf of Members utilizing the most
current version of the National Council for Prescription Drug Program
Telecommunication Standard ("NCPDP Standard") as the on-line claims
adjudication system (and shall upgrade to subsequent versions within six
(6) months of introduction of such NCPDP Standard) or a mutually
acceptable alternative in the event of on-line processing failure, to
Company's designated claims processor or at the time of service to the
Member. Pharmacy shall be able to accept on-line adjudication edits
according to the most current version of the NCPDP Standard. Pharmacy
agrees to submit claims in the amount as defined in the Compensation
Schedule. In no event shall the amount submitted be more than the rate
contained in the Compensation Schedule. HCFA 1500 transmitted claims or
paper submissions will be accepted for claims requiring an alternative
submission process. Universal Claim Forms and Tape Billing will not be
accepted for payment considerations. All claims submitted to Company or
its designated claims processor which assert claims against Company more
than sixty (60) days from the date the Covered Service was rendered will
not be paid. Pharmacy shall be responsible for payment of any electronic
transmittal fees that are incurred by the transmission of information to
and from Pharmacy (and individual pharmacies, where applicable) and
Company or its designated claims processor. Pharmacy shall not be
responsible for payment of claims processing fees to Company's claims
processor for the adjudication of claims by Company's claims processor.
3.6 Holding Members Harmless. If the applicable Payor is an HMO, Pharmacy
hereby agrees that in no event, including but not limited to non-payment
by the HMO, insolvency of the HMO or breach of this Agreement, shall
Pharmacy ▇▇▇▇, charge, collect a deposit from, seek remuneration or
reimbursement from, or have any recourse against a Member or persons
(other than the HMO) acting on a Member's behalf for Covered Services.
This provision shall not prohibit collection of Deductibles, Coinsurance,
or Copayments from Members in accordance with the terms of the Member's
Plan.
Pharmacy further agrees that (a) this provision shall survive termination
of this Agreement regardless of the cause giving rise to termination and
shall be construed for the benefit of Members, and (b) this provision
supersedes any oral or written agreement to the contrary now existing or
hereafter entered into between Pharmacy and a Member or persons acting on
a Member's behalf.
3.7 Pharmaceutical Manufacturer Volume Discounts. Pharmacy acknowledges that
Company has agreements with pharmaceutical manufacturers for the payment
of manufacturer volume discounts to Company. Pharmacy shall take no
action which would deny, diminish, usurp, jeopardize, or interfere with
Company's entitlement or pharmaceutical manufacturers payment to Company
of any manufacturer volume discounts owed to Company under an agreement
with a pharmaceutical manufacturer.
3.8 Coordination of Benefits. When a Payor is the primary payor under
applicable coordination of benefit principles, the Payor shall pay in
accordance with this Agreement, and when a Payor is secondary under said
principles, Payor's payment shall be limited as specified in the
applicable Plan. If the Plan fails to specify coordination of benefits
requirements, and unless prohibited by applicable law, Payor's payment
shall be limited to the amount which, together with the amount remitted
by the primary payor following all reasonable efforts by Pharmacy to
collect same, equals the compensation due to Pharmacy under this
Agreement, or if the primary payor fails to pay, Payor's payment shall be
in accordance with this Agreement. In no event shall amounts billed and
retained under coordination of benefits for Covered Services exceed
Pharmacy's contracted rate for such services.
4.0 COMPLIANCE WITH COMPANY RULES, POLICIES AND PROCEDURES
4.1 Compliance and Participation. Pharmacy shall comply fully with and be
bound by the Participation Criteria described in the PARTICIPATION
CRITERIA SCHEDULE (attached hereto and made a part hereof), the Provider
Policies and Services Manual, and shall also abide by the rules, policies
and procedures that Company has and will establish, including but not
limited to, those regarding (a) quality improvement/management; (b)
utilization management; (c) claims payment review; (d) Member grievances;
(e) provider credentialing; and (f) electronic submission of encounter
data, claims and other data required by Company. In addition to the
aforementioned, Pharmacy agrees to comply with precertification and other
requirements which are applicable to the dispensing of certain drugs.
Such requirements may include, but are not limited to, forwarding
physician supplied documentation to Company for review and approval,
follow up with physician, and return of prescriptions to Members with
appropriate explanation when certification for dispensing is denied by
Company. Pharmacy shall not return unfilled any prescription to a Member
unless Pharmacy provides a written explanation to Member the reason for
the return of the prescription. If Pharmacy receives an on-line response
that a prescription cannot be filled for reasons other than the drug is
not covered, Pharmacy shall contact either the Member or the prescribing
physician optometrist, physician assistant or dentist. Pharmacy
acknowledges and agrees that failure to comply with the terms of the
PARTICIPATION CRITERIA and Company's other rules, policies and procedures
may adversely affect any compensation due hereunder and could lead to
sanctions including, without limitation, termination of this Agreement.
Company may at any time modify the Participation Criteria and all Company
rules, policies and procedures.
4.2 Utilization Review. Company utilizes systems of utilization
review/quality improvement/peer review consistent with any applicable
federal and state laws to promote adherence to accepted standards for the
provision of Covered Services and to encourage Participating Providers to
control medical costs consistent with such standards. To this end,
Pharmacy agrees:
(a) To participate, as requested, and to abide by Company's
utilization review, disease management and quality improvement
programs and all other related programs (as modified from time to
time) and decisions with respect to all Members.
(b) To comply with Company utilization management requirements for all
Covered Services.
(c) To regularly interact and cooperate with Company's pharmacy
personnel.
(d) To cooperate with Participating Providers who prescribe
pharmaceuticals to Members.
(e) To abide by all Company credentialing criteria and procedures,
including but not limited to, site visits and Member profile and
pharmacy record reviews, and to submit to this process biannually
or annually when applicable.
4.3 Grievances. Pharmacy agrees to cooperate with and participate in
Company's applicable grievance procedures, provide Company with the
information necessary to resolve grievances, and abide by decisions of
the applicable grievance committees.
4.4 Notices and Reporting. Pharmacy shall (a) notify Company of any
litigation brought against Pharmacy; (b) notify Company of any actions
taken or investigations initiated by any government agency involving
Pharmacy or any health care entity in which Pharmacy holds more than a
five percent (5%) interest; (c) notify Company of any ownership interest
or position with another health maintenance organization or other managed
care organization or health plan; and (d) comply with any Company
requirements regarding reporting to Company within ten (10) days any loss
of licensure or accreditation, and claims by governmental agencies or
individuals regarding fraud, abuse, self-referral, false claims, or
kickbacks. All notices required by this section shall be provided to
Company within ten (10) business days of the date that Pharmacy acquired
knowledge of the occurrence of an event requiring notice, or earlier if
otherwise required by this Agreement. Upon Company's request, Pharmacy
shall provide all known details of the nature, circumstances and
disposition of any suits, claims, actions or investigations to Company.
4.5 Proprietary and Confidential Information. Pharmacy agrees that the
Proprietary Information is the exclusive property of Company or a third
party Payor and that Pharmacy has no right, title or interest in the
same. Pharmacy shall keep the Proprietary Information and this Agreement
strictly confidential and shall not disclose any Proprietary Information
or the contents of this Agreement to any third party, except to federal,
state and local governmental authorities having jurisdiction. Pharmacy
shall not use such materials, and shall at the request of Company return
such materials and any copies or abstracts thereof, upon termination of
this Agreement for whatever reason. In the event of a breach or a
threatened breach of this section by Pharmacy, Company shall have the
right of specific performance and injunctive relief in addition to any
and all other remedies and rights at law or in equity, and such rights
and remedies shall be cumulative.
4.6 Accreditation and Review Activities. Pharmacy shall implement all
activities reasonably necessary to assist Company to obtain external
accreditation by the National Committee for Quality Assurance or any
other similar organization selected by Company including, but not limited
to, cooperating in the auditing of Members' pharmacy records. Similarly,
Pharmacy shall fully cooperate with any review of Company or a Plan
conducted by a state or federal agency with authority over Company and/or
a Plan, as applicable.
5.0 INSURANCE
5.1 Pharmacy's Insurance. Pharmacy has and shall maintain throughout the term
of this Agreement professional liability and comprehensive liability
insurance in at least the minimum amounts specified in the PARTICIPATION
CRITERIA SCHEDULE.
6.0 INSPECTION OF RECORDS AND DATA ACCESS.
6.1 Access to Information. Pharmacy agrees that Company shall have access to
all data and information obtained, created or collected by Pharmacy
related to Members ("Information"). Such Information shall be jointly
owned by Pharmacy and Company and Pharmacy shall not enter into any
contract or arrangement whereby Company or Affiliates do not have
unlimited free and equal access to the Information in electronic or other
form or would be required to pay any access, transaction or other fee to
obtain such Information in electronic, written or other form. Information
shall not be directly or indirectly provided by Pharmacy to any
competitor of Company or Company Affiliates. Any and all information and
data provided to Pharmacy by Company or at Company's direction shall
remain the sole and exclusive property of Company and shall not be
disclosed by Pharmacy to any third party.
6.2 Confidentiality of Pharmacy Records. Pharmacy and Company agree that all
Member pharmacy records shall be treated as confidential so as to comply
with all state and federal laws regarding, among other things, the
confidentiality of patient records. According to the terms of Company HMO
enrollment forms, agreements with Members and applicable law, Company is
authorized to obtain information from Pharmacy without additional written
release by Member. Company shall have the right upon request to inspect
at all reasonable times any accounting, administrative, and pharmacy
records maintained by Pharmacy pertaining to Company, to Members, and to
Pharmacy's participation hereunder.
6.3 Provision of Records. Pharmacy agrees to provide Company and federal,
state and local governmental authorities having jurisdiction, upon
request, access to all books, records and other papers (including, but
not limited to, pharmacy and financial records) and information relating
to this Agreement and to those Covered Services rendered by Pharmacy to
Members and to maintain such books, records and papers and Information
for the longer of five (5) years from and after termination of this
Agreement or the period required by state law. All requested Information
shall be supplied within fourteen (14) days of the receipt of the
request, where practicable. This audit right may be extended to Payors
upon request of Company.
6.4 Pharmacy Records. Pharmacy shall maintain Information in a current,
detailed, organized and comprehensive manner and in accordance with
customary pharmacy practice and applicable state and federal laws.
Pharmacy records shall include, but not be limited to, the Member's name,
address, telephone number as well as pertinent information regarding the
pharmaceuticals dispensed, the Member's known allergies and allergic
reactions to date and a pertinent medical history of Member. Pharmacy
shall consult the Member's record prior to the dispensing of each
prescription to the Member. Pharmacy shall make these records available
to (a) Company for the purpose of assessing quality of care, conducting
pharmacy evaluations and audits; and (b) applicable state and federal
authorities and their agents involved in assessing the quality of care or
investigating Member grievances or complaints.
6.5 Survival. These data access and records provisions shall survive the
termination of this Agreement regardless of the cause giving rise to the
termination.
7.0 TERM AND TERMINATION
7.1 Term and Renewal. This Agreement shall commence on the Effective Date
and, subject to the termination provisions contained herein, shall
continue in full force and effect for three (3) years from the effective
date. Thereafter, this Agreement shall automatically renew on May 1 of
each calendar year for successive terms of one (1) year each.
7.2 Termination without Cause. This Agreement may be terminated by either
party at any time without cause upon at least ninety- (90) days prior
written notice to the other party.
7.3 Termination for Breach. This Agreement may be terminated by either party
upon at least thirty (30) days prior written notice of such termination
to the other party upon default or breach by such party of one or more of
its obligations hereunder, unless such default or breach is cured within
thirty (30) days of the notice of termination.
7.4 Immediate Termination or Suspension. This Agreement may be immediately
terminated, or Pharmacy's, and/or individual pharmacy's, participation in
any or all Plans immediately suspended, by Company at its sole discretion
at any time due to (a) a suspension, withdrawal, expiration, non-renewal
or revocation of any state or local license, certificate or other legal
credential authorizing Pharmacy to operate; (b) a suspension or
revocation of Pharmacy's DEA number or other right to dispense controlled
substances; (c) Pharmacy's indictment, arrest or conviction for a felony
or for any criminal charge related to moral turpitude or the Pharmacy's
provision of Covered Services; (d) the cancellation, reduction,
limitation or termination of any insurance required by this Agreement;
(e) a suspension or debarment from participation in the Medicare or
Medicaid programs; (f) a filing in bankruptcy, the appointment of a
receiver, the marshaling of debts or assets, or the proposed settlement
of outstanding debts under applicable reorganization or insolvency laws
filed by or against Pharmacy; (g) any false statement or material
omission in the participation application and/or confidential information
forms and all other requested information, as determined by Company in
its sole discretion; (h) Pharmacy's submission of fraudulent claims or
failure to withdraw claims made for prescriptions which have been filled
but were never received by the Member for any reason; or (i) Company's
determination, in its sole discretion, that continuation of this
Agreement could pose, or is likely to pose, an immediate threat to Member
health or safety. Pharmacy shall provide immediate notice to Company of
any of the aforesaid events.
7.5 Obligations Following Termination. Following the effective date of any
termination of this Agreement, or any Plan, Pharmacy shall comply with
the following obligations. This section shall supersede any contrary
arrangements now existing or hereinafter made and shall survive the
termination of this Agreement, regardless of the cause of termination.
7.5.1 Upon Insolvency or Cessation of Operations. If this Agreement
terminates as a result of insolvency or cessation of operations of
a Company Affiliate that is an HMO, and as to Members of HMOs that
become insolvent or cease operations, then in addition to the
other obligations set forth in this section, Pharmacy shall
continue to provide Covered Services to all Members for the period
for which premium has been paid. This section shall be construed
to be for the benefit of Members. No modification to this section
shall be effective without the prior written approval of the
applicable regulatory agencies.
7.5.2 Obligation to Cooperate. Upon notice of termination of this
Agreement or of a Plan, Pharmacy shall cooperate fully with
Company and comply with Company procedures, if any, in the
transfer of Members to other providers.
8.0 MODIFICATIONS
8.1 Amendments. This Agreement constitutes the entire understanding of the
parties hereto and no changes, amendments, or alterations shall be
effective unless signed by both parties, except as expressly provided
herein. Notwithstanding the foregoing, at Company's discretion, Company
may amend this Agreement upon written notice to Pharmacy to comply with
any applicable law or regulation, or any order or directive of any
governmental agency.
8.2 Plan Participation. Company has and retains the right to designate
Pharmacy as a Participating Provider or non-participating provider in any
specific Plan. Company reserves the right to introduce new Plans to its
membership during the course of this Agreement. Pharmacy agrees that
Pharmacy will provide Covered Services to Members of such Plans under
applicable compensation arrangements determined by Company. Pharmacy
shall accept compensation in accordance with this Agreement for the
provision of any Covered Services to Members under a Plan, regardless of
whether or not Pharmacy is a Participating Provider in such Plan. Company
has or intends to seek a contract to serve Medicare and/or Medicaid
beneficiaries. Such beneficiaries shall be considered as Members.
Pharmacy shall be bound by all requirements applicable to such contract
and all rules and regulations of the Medicare and Medicaid programs.
9.0 RELATIONSHIP OF THE PARTIES
9.1 Independent Contractor Status. The relationship between Company and
Pharmacy and their respective employees and agents is that of independent
contractors, and none shall be considered an agent or representative of
the other for any purpose, nor shall any party or its agents or employees
hold themselves out to be an agent or representative of any other party
for any purpose. Company and Pharmacy will each be liable solely for
their own activities and those of their agents and employees, and neither
Company nor Pharmacy will be liable for the activities of the other or
the agents and employees of the other, including without limitation any
liabilities, losses, damages, injunctions, suits, actions, fines,
penalties, claims or demands of any kind or nature by or on behalf of any
person, party or governmental authority arising out of or in connection
with (a) any failure to perform any of the agreements, terms, covenants
or conditions of this Agreement; (b) any negligent act or omission or
other misconduct; (c) the failure to comply with any applicable laws,
rules or regulations; and (d) any accident, injury or damage. Pharmacy
acknowledges that all Member care and related decisions are the sole
responsibility of Pharmacy and that Company's procedures, protocols and
policies do not dictate or control Pharmacy's clinical decisions with
respect to the care of Members. Pharmacy agrees to indemnify and hold
harmless Company from any and all claims, liabilities and causes of
action, including costs and counsel fees, arising out of Pharmacy's care
of Members. This provision does not re quire Pharmacy to indemnify or
hold harmless Company (including costs and counsel fees) for the acts or
conduct of Company giving rise to liability and shall survive the
termination of this Agreement, regardless of the reason for termination.
9.2 Use of Name. Pharmacy shall not use Company names, logos, trademarks or
service marks in marketing materials or otherwise except as provided in
this Agreement, without prior written consent. Pharmacy consents to the
use of Pharmacy's name and other identifying and descriptive material in
provider directories and in other materials and marketing literature of
Company. If requested by Company, Pharmacy shall identify itself to the
public as a Participating Provider.
9.3 Interference with Contractual Relations. Pharmacy shall not (a) counsel
or advise, directly or indirectly, Payors, Sponsors or other entities who
are currently under contract with Company or any Affiliate to cancel,
modify, or not renew said contracts, (b) impede or otherwise interfere
with negotiations which Company or an Affiliate is conducting for the
provision of health insurance or Plans, or (c) use or disclose to any
third party membership lists acquired during the term of this Agreement
directly or indirectly for the purpose of soliciting individuals who were
or are Members or otherwise to compete with Company or any Affiliate.
This section shall survive the termination of this Agreement. In the
event of a breach or a threatened breach of this section by Pharmacy,
Company shall have the right of specific performance and injunctive
relief in addition to any and all other remedies and rights at law or in
equity, and such rights and remedies shall be cumulative.
9.4 Consideration for this Agreement. Pharmacy agrees that nothing of value,
other than as set forth in this Agreement, was demanded or exchanged by
Company in return for participation in the Company pharmacy network or
signing of this Agreement.
10.0 COMPANY'S OBLIGATIONS AND DISPUTE RESOLUTION
10.1 Company's Obligations. Company or Payors shall provide Pharmacy with a
means to identify Members and other Participating Providers, an
explanation of benefits available to Members, administrative
requirements, a listing of physicians, hospitals and ancillary providers
in Company's network and timely notification of significant changes in
this information. Company will enable Pharmacy to check eligibility.
Company will include Pharmacy in the applicable Provider Directory(s) and
will make the directory available to Members. Company shall provide a
dispute resolution mechanism whereby Pharmacy may raise issues regarding
the obligations of either party under this Agreement. Pharmacy agrees to
utilize this dispute resolution procedure prior to submitting a complaint
to any regulatory agency or instituting any legal action.
10.2 Dispute Resolution/Arbitration
10.2.1 Dispute Resolution. Company shall provide an internal mechanism
whereby Pharmacy may raise issues, concerns, controversies or
claims regarding the obligations of the parties under this
Agreement. Pharmacy shall utilize this internal mechanism prior
to submitting a complaint to any regulatory agency or
instituting any arbitration or other permitted legal proceeding.
Discussions and negotiations held specifically pursuant to this
Section 10.2.1 shall be treated as compromise and settlement
negotiations for purposes of applicable rules of evidence.
10.2.2 Submission of Claim or Controversy to Arbitration. Any
controversy or claim arising out of or relating to this
Agreement or the breach, termination, or validity thereof,
except for temporary, preliminary, or permanent injunctive
relief or any other form of equitable relief, shall be settled
by binding arbitration administered by the American Arbitration
Association ("AAA") and conducted by a sole Arbitrator
("Arbitrator") in accordance with the AAA's Commercial
Arbitration Rules ("Rules"). A stenographic record shall be made
of all testimony in any arbitration in which any disclosed claim
or counterclaim exceeds $250,000. The arbitration shall be
governed by the Federal Arbitration Act, 9 U.S.C. ▇▇.▇▇. 1-16,
to the exclusion of state laws inconsistent therewith or that
would produce a different result, and judgment on the award
rendered by the Arbitrator (the "Award") may be entered by any
court having jurisdiction thereof. An Award for $250,000 or more
shall be accompanied by a short statement of the reasoning on
which the Award rests.
10.2.3 Appeal of Arbitration Award. Within thirty (30) days of receipt
of an Award of $250,000 or more (which shall not be binding if
an appeal is taken), a party may notify the AAA of its intention
to appeal the Award to a second Arbitrator (the "Appeal
Arbitrator"), designated in the same manner as the Arbitrator
except that the Appeal Arbitrator must have at least twenty (20)
years' experience in the active practice of law or as a judge.
The Appeal Arbitrator shall not take new testimony or other
evidence and shall not modify or replace the Award except for
clear error of law. The Award, as confirmed, modified or
replaced by the Appeal Arbitrator, shall be final and binding,
and judgment thereon may be entered by any court having
jurisdiction thereof.
10.2.4 Confidentiality. Except as may be required by law or to the
extent necessary in connection with a judicial challenge,
permitted appeal, or enforcement of an Award, neither a party
nor an arbitrator may disclose the existence, content, record,
status or results of a negotiation or arbitration. Any
information, document, or record (in whatever form preserved)
referring to, discussing, or otherwise related to a negotiation
or arbitration, or reflecting the existence, content, record,
status, or results of a negotiation ("Negotiation Record") or
arbitration ("Arbitration Record"), is confidential and each
party to this Agreement shall (i) protect Negotiation and
Arbitration Records from unauthorized use or disclosure with at
least the same degree of care it uses to protect its own
confidential information of a similar nature; (ii) use
Negotiation and Arbitration Records only for the purpose(s)
expressly set forth in, and in accordance with, the terms of
this Agreement; (iii) not disclose or otherwise permit any third
person or entity access to Negotiation or Arbitration Records
except with the other party's prior written consent; and (iv)
take any and all other steps necessary to safeguard Negotiation
and Arbitration Records against disclosure to third parties. The
arbitration hearing shall be closed to any person or entity
other than the arbitrator, the parties, witnesses during their
testimony, and attorneys of record. Upon the request of a party,
an arbitrator may take such actions as are necessary to enforce
this Section 10.2.4, including the imposition of sanctions.
10.2.5 Pre-hearing Procedure for Arbitration. The parties will
cooperate in good faith in the voluntary, prompt and informal
exchange of all documents and information (that are neither
privileged nor proprietary) relevant to the dispute or claim,
all documents in their possession or control on which they rely
in support of their positions or which they intend to introduce
as exhibits at the hearing, the identities of all individuals
with knowledge about the dispute or claim and a brief
description of such knowledge, and the identities,
qualifications and anticipated testimony of all experts who may
be called upon to testify or whose report may be introduced at
the hearing. The parties and Arbitrator will make every effort
to conclude the document and information exchange process within
sixty (60) calendar days after all pleadings or notices of
claims have been received. At the request of a party in any
arbitration in which any disclosed claim or counterclaim exceeds
$250,000, the Arbitrator may also order pre-hearing discovery by
deposition upon good cause shown. Such depositions shall be
limited to a maximum of three (3) per party and shall be limited
to a maximum of six- (6) hours' duration each. As they become
aware of new documents or information (including experts who may
be called upon to testify), all parties remain under a
continuing obligation to provide relevant, non-privileged
documents, to supplement their identification of witnesses and
experts, and to honor any understandings between the parties
regarding documents or information to be exchanged. Documents
that have not been previously exchanged, or witnesses and
experts not previously identified, will not be considered by the
Arbitrator at the hearing. Fourteen (14) calendar days before
the hearing, the parties will exchange and provide to the
Arbitrator (a) a list of witnesses they intend to call
(including any experts) with a short description of the
anticipated direct testimony of each witness and an estimate of
the length thereof, and (b) premarked copies of all exhibits
they intend to use at the hearing.
10.2.6 Arbitration Award. The arbitrator may award only monetary relief
and is not empowered to award damages other than compensatory
damages and, in the arbitrator's discretion, pre-award interest.
The Award shall be in satisfaction of all claims by all parties.
Arbitrator fees and expenses shall be borne equally by the
parties. Postponement and cancellation fees and expenses shall
be borne by the party causing the postponement or cancellation.
Fees and expenses incurred by a party in successfully enforcing
an Award shall be borne by the other party. Except as otherwise
provided in this Agreement, each party shall bear all other fees
and expenses it incurs, including all filing, witness, expert
witness, transcript, and attorneys' fees.
11.0 MISCELLANEOUS
11.1 Waiver. 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 thereof. To be effective, all waivers
must be in writing and signed by the party to be charged.
11.2 Governing Law. This Agreement shall be governed in all respects by the
laws of the Commonwealth of Pennsylvania. Pharmacy agrees that any action
brought under this Agreement shall be solely and exclusively brought in
the courts of the Commonwealth of Pennsylvania, ▇▇▇▇▇▇▇▇▇▇ County, it
being acknowledged that Company is a Pennsylvania corporation which
maintains its headquarters in said county and that this Agreement will be
executed by Company in said county. Pharmacy irrevocably consents to the
personal jurisdiction of the courts of the Commonwealth of Pennsylvania.
11.3 Liability. Notwithstanding section 11.2, Company's liability, if any, for
damages to Pharmacy for any cause whatsoever arising out of or related to
this Agreement, and regardless of the form of the action, shall be
limited to Pharmacy's actual damages which shall not exceed the amounts
actually paid to Pharmacy by Company under this Agreement during the
twelve (12) month period immediately prior to the date the cause of
action arose. Company shall not be liable for any indirect, incidental,
punitive, exemplary, special or consequential damages of any kind
whatsoever sustained as a result of a breach of this Agreement or any
action, inaction, alleged tortious conduct, or delay by Company.
11.4 Statute of Limitations. Notwithstanding section 11.2, no action,
regardless of form, arising out of or related to this Agreement may be
brought by any party more than twelve (12) months after such cause of
action has arisen.
11.5 Severability. Any determination that any provision of this Agreement or
any application thereof is invalid, illegal or unenforceable in any
respect in any instance shall not affect the validity, legality and
enforceability of such provision in any other instance, or the validity,
legality, or enforceability of any other provision of this Agreement.
11.6 Inconsistencies. If any term or provision of this Agreement is
inconsistent with a term or provision of a non-insured Plan, then as to
individuals entitled to receive Covered Services through said Plan, the
term or provision of the Plan shall prevail.
11.7 Assignment. This Agreement shall not be assignable or transferable, in
whole or in part, by Pharmacy, including, without limitation, by (a) sale
or transfer of (i) capital stock or comparable equity interests, or (ii)
controlling voting interests, (b) operation of law in connection with a
merger or (c) sale of all or substantially all of the assets of Pharmacy,
without the prior written consent of Company, its successors or assigns.
Any assignment, whether in compliance with the foregoing or otherwise,
shall be binding upon and for the benefit of the parties hereto and their
successors and assigns.
11.8 Affirmative Action. Company is an Equal Opportunity Employer which
maintains an Affirmative Action Program. To the extent applicable to
Pharmacy, Pharmacy agrees to comply with the following, as amended from
time to time: Executive Order 11246, the Vietnam Era Veterans
Readjustment Act of 1974, the Drug Free Workplace Act of 1988, Section
503 of the Rehabilitation Act of 1973, any similar legislation regarding
transactions relating to any Company or an Affiliate's government
contract, and any rules and regulations promulgated under such laws.
11.9 Headings. The headings contained in this Agreement are included for
purposes of convenience only, and shall not affect in any way the meaning
or interpretation of any of the terms or provisions of this Agreement.
11.10 Notices. Any notice required to be given pursuant to the terms and
provisions hereof shall be effective only if given in writing and sent by
overnight delivery service with proof of receipt, or by certified mail
return receipt requested. Notices shall be sent to the following
addresses (which may be changed by giving notice in conformity with this
Section):
To Pharmacy at:
Chronimed, Inc.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and to Company at:
Aetna U.S. Healthcare
Pharmacy Management
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
11.11 Non-Exclusivity. This Agreement is not exclusive, and nothing herein
shall preclude either party from contracting with any other person or
entity for any purpose.
11.12 Entire Agreement. This Agreement (including any attached schedules)
constitutes the complete and sole contract between the parties and
supersedes any and all prior or contemporaneous oral or written
communications or proposals not expressly included herein.
11.13 Regulatory Requirements. Upon written request from Company, Pharmacy
agrees to re-execute this Agreement in its current form in the name of
the Company HMO, and to accept any amendment hereto as may be required by
regulatory authorities.
11.14 Construction. Each party acknowledges that it has had the opportunity to
be represented by counsel of its choice with respect to this Agreement.
In view of the foregoing and notwithstanding any otherwise applicable
principles of construction or interpretation, this Agreement shall be
deemed to have been drafted jointly by the parties and, in the event of
any ambiguity, shall not be construed or interpreted against the drafting
party.
11.15 Disclaimer of Representations and Warranties. Company makes no
representation, warranty or guarantee, including, without limitation, any
representation, warranty or guarantee as to any volume of business, the
volume or type of Covered Services to be provided by Pharmacy pursuant to
this Agreement, the number of Providers who may prescribe products
dispensed by Pharmacy, or the number of Members who may utilize Pharmacy.
12.0 DEFINITIONS
When used in this Agreement, all capitalized terms shall have the following
meanings:
12.1 Affiliate. An Affiliate, with respect to Company, means any corporation,
partnership or other legal entity (including any Plan) directly or
indirectly owned or controlled by, or which owns or controls, or which is
under common ownership or control with, Company.
12.2 Average Wholesale Price. The current average wholesale price of a
prescription drug listed in the Medi-Span weekly price updates (or any
other similar publication designated by Company) on the day that Pharmacy
submits a claim for adjudication.
12.3 Brand Name Drug. A prescription drug with a proprietary name assigned to
it by the manufacturer or distributor and so indicated by Medi-Span or
any other similar publication designated by Company. Brand Name Drug does
not include those drugs classified as Generic Drugs pursuant to Section
12.8.
12.4 Coinsurance. The portion of the usual, customary and reasonable fee for
the Covered Services that the Member is required to pay after application
of any applicable Copayments or Deductibles.
12.5 Copayment. A charge required under a Plan that must be paid by a Member
at the time of the provision of Covered Services.
12.6 Covered Services. Those Medically Necessary Services which a Member is
entitled to receive under the terms and conditions of a Plan.
12.7 Deductible. An amount that a Member must pay for Covered Services per
specified period in accordance with the Member's Plan before benefits
will be paid.
12.8 Emergency Services. Those services necessary to treat a medical condition
manifesting itself by acute symptoms of sufficient severity (including
severe pain) such that a prudent layperson, who possesses an average
knowledge of health and medicine, could reasonably expect the absence of
immediate medical attention to result in: (a) placing the health of
individual (or, with respect to a pregnant woman, the health of the woman
and her unborn child) in serious jeopardy; (b) serious impairment to
bodily functions; or (c) serious dysfunction of any bodily organ or part;
or such broader definition required by applicable law.
12.9 Generic Drug. A prescription drug, whether identified by its chemical,
proprietary, or non-proprietary name, that is accepted by the U.S. Food
and Drug Administration as therapeutically equivalent and interchangeable
with drugs having an identical amount of the same active ingredient.
12.10 Internet Pharmacy Services. Pharmacy services and products provided,
serviced or administered, directly or indirectly, by any provider,
including but not limited to any pharmacy provider providing or servicing
customers or providers, through the internet, the World Wide Web, or any
other similar electronic medium. Internet Pharmacy Services shall include
all prescriptions (whether the original fill or a refill) submitted to a
provider, directly or indirectly, via the internet, the World Wide Web,
or any other similar electronic medium.
12.11 Medically Necessary Services. Unless otherwise defined in an applicable
Plan or by applicable law, health care services that are appropriate and
consistent with the diagnosis in accordance with accepted medical
standards and which are likely to result in demonstrable medical benefit,
and which are the least costly of alternative supplies or levels of
service which can be safely and effectively provided to the patient.
Medically Necessary Services do not include custodial or supportive care
or rest cures, or services or supplies provided for the convenience of
the patient, the patient's family, or the provider. When used in relation
to hospital inpatient care, Medically Necessary Services only include
those services and supplies that cannot be safely and satisfactorily
provided at home, in a physician's office, as an outpatient service, or
in any lesser facility. Medically Necessary Services must be related to
diagnosis or treatment of an existing illness or injury, except for
preventive and well baby care. Health services are not Medically
Necessary Services if they are experimental services. Medical necessity,
when used in relation to services, shall have the same meaning as
Medically Necessary Services.
12.12 Member. An individual covered by or enrolled in a Plan.
12.13 Participating Provider. Any pharmacy, physician, hospital, skilled
nursing facility, or other individual or entity involved in the delivery
of health care or ancillary services who or which has entered into and
continues to have a current valid contract with Company to provide
Covered Services to Members, and has been credentialed by Company or its
designee consistent with Company's credentialing policies.
12.14 Payor. An employer, insurer, health maintenance organization, labor
union, organization or other person or entity which has agreed to be
responsible for funding benefit payments for Covered Services provided to
Members under the terms of a Plan.
12.15 Plan. Any health benefit product, plan or program issued, administered,
or serviced by Company or one of its Affiliates, including but not
limited to HMO, preferred provider organization, indemnity, Medicaid,
Medicare and Worker's Compensation.
12.16 Proprietary Information. The information developed by or belonging to
Company or any third party Payor including, but not limited to, mailing
lists, patient lists, employer lists, Company rates and procedures,
product relation information and structure, utilization review
procedures, formats and structure and related information and documents
concerning Company's systems and operations of its Plans.
12.17 Sponsor. An entity that has contracted with Company to issue, administer,
or service a Plan. Sponsors shall include without limitation employer
groups sponsoring or offering a self-insured Plan to their employees.
IN WITNESS WHEREOF, the undersigned parties have executed this Agreement,
intending to be bound thereby.
PHARMACY COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
------------------------ ----------------------
Printed Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ Printed Name: ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇
-------------------- ------------------
Title: President Title: Vice President of Aetna
--------- -----------------------
Date: May 15, 2000 Date: May, 17, 2000
------------ -------------
License No. _________________________________
National Association of Boards of Pharmacy
NABP No. :_________________________
PROVIDER:
SERVICES:
A. Pharmacy agrees to provide the Covered Services to Members, subject to
the conditions set forth in the Specialty Pharmacy Mail Service Vendor
Agreement:
1. Filling of prescriptions for prescription biologicals, drugs, and
medications. The supply and number of refills for each
prescription will be as allowed by the Member's Plan and
applicable federal and state laws and regulations.
2. Pharmacy shall dispense XXXX, as provided from time to time by
Company.
B. Unless the Member's Plan provides otherwise, the following are not
covered benefits, and neither Company nor Payor will make payment to
Pharmacy therefor. Confirmation of whether a service is covered or not in
accordance with a Member's Plan is made to Pharmacy on-line upon
submission by Pharmacy of prescription data.
1. XXXX;
2. XXXX;
3. XXXX;
4. XXXX;
5. XXXX;
6. XXXX;
7. XXXX;
8. XXXX;
9. XXXX; and
10. XXXX.
COMPENSATION:
A. Subject to the terms of this Agreement and the terms of the
applicable Plan, Pharmacy shall accept reimbursement for Covered
Services ("Reimbursement Rate") in accordance with the following:
The Reimbursement Rate for each prescription drug dispensed
shall be equal to the lesser of:
(i) XXXX ; or
For Brand Name and Generic Drugs XXXX:
(i) XXXX, or
(ii) XXXX.
B. Compensation: Payor
The compensation per claim payable by Payor to Pharmacy, subject
to the terms of this Agreement and the applicable Plan, shall be
equal to:
(i) XXXX
(ii) XXXX.
(iii) XXXX.
C. Compensation: Member
(i) Pharmacy acknowledges that the Copayment/Co-insurance is an
integral part of the Health Benefit Plan selected by the
Payor and agrees that it will not waive or discount the
applicable Copayment/Co-insurance under any circumstance.
Pharmacy will not ▇▇▇▇ Members for amounts in excess of the
Deductible, Copayments, and/or Co-insurance provided for in
Member's Plan.
(ii) In cases where the Reimbursement Rate is less than the
Copayment, Pharmacy agrees to charge the Member the
Reimbursement Rate. There shall be no additional
compensation from Payor in such cases.
DEFINITIONS:
D. Maximum Allowable Cost (MAC). The compensation level established
by Company for Generic Drugs for which there are more than one
manufacturer ("Multi-Source"), as modified from time to time.
E. Maximum Allowable Cost List (MAC List). The list of Generic Drugs
for which reimbursement to Pharmacy shall be paid according to
prices established by Company, as modified from time to time.
Shipping and Handling Charges. XXXX.
F. Ancillary Supplies XXXX.
EXHIBIT A
--------------------------------------------------------------------------------------
DISPENSING
THERAPEUTIC CATEGORIES DISCOUNT FEE SPECIAL COMMENTS
--------------------------------------------------------------------------------------
ALL Blood Derivatives AWP -XX* XXXX XXXX
(Immune Globulins, Factors)
not defined below
--------------------------------------------------------------------------------------
ALL Injectable Medications AWP -XX XXXX
not defined below
--------------------------------------------------------------------------------------
Growth Hormone:
(i) XXXX AWP -XX XXXX
(ii) XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
Non-Injectable Medications; AWP -XX XXXX XXXX
e.g. Ancillary, Oral,
Suppositories, Compounds and
inhalers.
--------------------------------------------------------------------------------------
Diabetes Care Products AWP -XX XXXX XXXX
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
DISPENSING
SPECIFIC PRODUCT DISCOUNT FEE SPECIAL COMMENTS
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX XXXX XXXX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
XXXX AWP -XX XXXX
--------------------------------------------------------------------------------------
I. BUSINESS CRITERIA
A. APPLICABILITY
1. These criteria shall apply to each Pharmacy applicant for
participation and each Pharmacy participating in Plans, and
shall be enforced at the sole discretion of Company.
2. Each participating Pharmacy must continue to meet the
following criteria for the duration of participation in the
Plans.
B. GENERAL
1. For purposes of the following criteria, the terms
"Pharmacy" and "Pharmacist" includes each of the pharmacies
covered by the terms of the Agreement and each of those
pharmacies' respective pharmacists.
2. The Pharmacy and each of its Pharmacists must meet all
standards set by governmental agencies, including, but not
limited to, the State Board of Pharmacy, the Drug Device
and Cosmetic Board, the Drug Enforcement Administration,
and the Food and Drug Administration.
C. PHARMACY STANDARDS
1. All areas of the Pharmacy must be clean and reflect a
professional image. In particular, the prescription
department, including the counter and drug storage area
must be clean, uncluttered, washed and/or dusted regularly,
well lighted, and generally maintained in such a manner as
to allow for maximum efficiency and minimum opportunity for
errors.
2. The Pharmacy must have a library of current appropriate
professional reference materials.
D. PHARMACY REQUIREMENTS
1. Pharmacy Inventory
a. An adequate inventory of prescription drugs
necessary to fill Member's prescriptions in
accordance with the applicable Plan must be carried
by the Pharmacy.
b. All solutions and reconstitutions of prescription
drugs must be made with distilled water, except
ophthalmic solutions and other special solutions
which shall be prepared with sterile, distilled
water or other sterile vehicles.
2. Responsibilities of Pharmacist
a. The Pharmacist on duty shall have full authority to
make and implement decisions on all matters
requiring professional judgment.
b. The Pharmacist shall provide written information
concerning dosage administration, precautions,
storage conditions, and other appropriate
information when a new prescription medication is
dispensed to any Member or such Member's
representative. Any intervention performed by a
Pharmacist must be noted on the subject Member's
patient profile or prescription record.
c. The Pharmacist shall be readily accessible to
Members for consultation on a designated toll free
number.
d. The ratio of Pharmacists who oversee and approve or
disapprove the final dispensing of prescriptions to
the number of prescriptions which they oversee and
approve or disapprove shall not exceed three hundred
(300) prescriptions per day per Pharmacist.
e. Each Pharmacist must participate in and abide by
peer review mechanisms adopted by Company.
3. Formulary
a. Pharmacy shall support Company's Formulary.
E. AVAILABILITY/DELIVERY
1. The Pharmacy shall provide customer service coverage
twenty-four (24) hours a day, seven (7) days a week with
access to representatives able to respond to Member's
questions and concerns regarding their prescription drugs.
2. The Pharmacy must provide overnight delivery service in
emergency situations or when the specific prescription drug
requires such overnight delivery.
3. The Pharmacy must obtain a signed receipt upon delivery of
any controlled substances, skeletal muscle relaxants and
anti-viral agents, or as required by applicable law or
regulation.
F. INSURANCE
1. During the entire term of this Agreement, Pharmacy shall
maintain insurance at minimum levels required from time to
time by Company, but in no event less than: (a)
professional liability insurance at a minimum level of one
million dollars ($1,000,000) per claim and two million
dollars ($2,000,000) in the annual aggregate, except in
cases where this level of insurance exceeds that required
by applicable state law, in which instance Pharmacy shall
maintain the maximum level of professional liability
insurance required by law; (b) comprehensive general
liability insurance at a minimum level of one million
dollars ($1,000,000) per claim and two million dollars
($2,000,000) in the annual aggregate. Pharmacy's insurance
shall cover the acts and omissions of Pharmacy as well as
Pharmacy's agents and employees. Memorandum copies of such
policies shall be delivered to Company upon request.
Pharmacy must notify Company at least thirty (30) days in
advance of the cancellation, limitation or material change
of said policies.
G. COMPENSATION
1. The Pharmacy must possess the ability to submit claims by
means of the Company electronic claims system, as updated
from time to time.
2. The applicable Deductible or Copayment amount shall not be
waived for each prescription that a Member fills. Pharmacy
shall make all reasonable efforts to collect applicable
Copayment and Deductible amount.
3. The Pharmacy shall not offer premiums or discounts to
patients participating in Company Plans.
H. PHARMACY RECORDS
1. The Pharmacy must utilize complete up-to-date patient
medication records for Members. In addition to the
patient's name, address, telephone number, and pertinent
information regarding the medications dispensed, the Member
records shall include information regarding a Member's
known allergies and allergic reactions to date and a
pertinent medical history of the Member. The Member's
medication record must be consulted prior to dispensing any
prescribed medication to a Member.
2. The Pharmacy must permit appropriate Company
representatives and appropriate state and/or federal
officials to have access to Members' records, and shall
permit the copying of said records to comply with
regulatory and quality assessment reviews.
I. PHILOSOPHY
1. Pharmacy must be supportive of the philosophy and concept
of managed care and Company. Pharmacy shall not
differentiate or discriminate in the treatment of, or in
the access to treatment of, patients on the basis of their
status as Members, or other grounds identified in the
Agreement.
2. Pharmacy shall have the right and is encouraged to discuss
with his or her patients pertinent details regarding the
diagnosis of the patient's conditions, the nature and
purpose of any recommended treatment, the potential risks
and benefits of any recommended treatment, and any
reasonable alternatives to such recommended treatment.
3. Pharmacy's obligations under the Agreement not to disclose
Proprietary Information do not apply to any disclosures to
a patient determined by Pharmacy to be necessary or
appropriate for the care of a patient, except to the extent
such disclosure would otherwise violate Pharmacy's legal or
ethical obligations.
4. Pharmacy is encouraged to discuss Company's provider
reimbursement methodology with Pharmacy's patients who are
Members, subject to Pharmacy's general contractual and
ethical obligations not to make false or misleading
statements. Accordingly, Proprietary Information does not
include descriptions of the methodology under which
Pharmacy is reimbursed, although such Proprietary
Information does include the specific rates paid by Company
due to their competitively sensitive nature.
II. PROFESSIONAL CRITERIA
A. CONTINUING EDUCATION
1. Each Pharmacist shall continue his/her professional
education through participation in continuing education
programs.
III. PROFESSIONAL COMPETENCE AND CONDUCT
A. GENERAL
1. Each Pharmacist working at the Pharmacy must be of sound
moral character and must not have been indicted, arrested,
or convicted of criminal charges related to moral turpitude
or the practice of pharmacy related services.
2. Each Pharmacist working at the Pharmacy must not have
engaged in any unprofessional conduct, unacceptable
business practices or any other act or omission which may
raise concerns about possible future substandard
professional performance, competence or conduct.
B. NOTIFICATION OF ADVERSE ACTIONS OR LIMITATIONS
1. Pharmacy shall provide immediate notice to Company of any
adverse action relating to said Pharmacy's license(s)
and/or certification(s). "Adverse action" includes, but is
not limited to: denial; fine; monitoring; probation;
suspension; letter of concern, guidance, censure, or
reprimand; expiration without renewal; subject to
disciplinary action or other similar action or limitation;
restriction, counseling; loss in whole or in part; censure;
administrative letter; non-renewal; voluntary or
involuntary surrender of licensure or status to avoid, or
in anticipation of, any of the adverse actions listed; and
initiation of investigations, inquiries or other
proceedings that could lead to any of the actions listed.
Any such adverse actions may be grounds for action,
including without limitation, denial, termination, or other
sanctions imposed pursuant to Company's
credentialing/quality improvement programs.
IV. PERFORMANCE ASSESSMENTS
Please see attached Performance Assessments
These criteria may be modified at the sole discretion of Company.
SPECIALTY PHARMACY NETWORK
Performance Assessments
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Payment for
Failure to
meet
Performance Performance Frequency Annual
Review Standard Sub-Category Standard of Review Maximum Category Category
Category Item Measurement Weighting Measurement and Payout Per Year Weighting $ at Risk
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[STRICKEN AS CONFIDENTIAL]
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