Terms & Conditions

SEVARX PHARMACY NETWORK TERMS AND CONDITIONS FOR RETAIL, HOME INFUSION, LONG TERM CARE SERVICES

RECITALS

WHEREAS, SEVARX has contracted with Plan Sponsors or other payors to provide certain pharmacy benefit management services including administrative, network, and/or claims processing services in connection with the operation of that Plan.

WHEREAS, PHARMACY owns, operates or manages one or more duly licensed pharmacies qualified to provide Covered Prescription Services to Members;

WHEREAS, SEVARX desires to engage PHARMACY to provide Covered Prescription Services to Members in accordance with the Terms and Conditions, The SevaRx Pharmacy Network Participation Agreement, and the SevaRx State Supplement to the Pharmacy Participation Agreement (collectively, the “Agreement”);

NOW, THEREFORE, in consideration of the foregoing premises, mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

DEFINITIONS

1.1         “Affiliate” shall mean with respect to any person or entity, any other person or entity which directly or indirectly controls, is controlled by or is under common control with such person or entity.

1.2         “Average Wholesale Price” or “AWP” means the average wholesale price of a Prescription Drug based on the most current pricing information then available to SEVARX from the National Average Drug Acquisition Cost (“NADAC”) latest update at the date and time that the Prescription Drug is actually dispensed by PHARMACY. The AWP of a Prescription Drug shall be for the eleven (11) digit NDC corresponding to the Drug-specific, quantity-appropriate actual package size that PHARMACY dispensed at that date and time. SEVARX shall update AWP data no less than weekly.

1.3         “Brand Drug” shall mean a drug indicated by NADAC as “B” by NADAC’s Classification for Rate Setting.

1.4         “Claim” shall mean and refer to a PHARMACY’s billing or invoicing following National Counsel for Prescription Drug Programs (“NCPDP”) standards for a single prescription for Covered Prescription Services dispensed to a Member enrolled with a Plan in accordance with this Agreement.

1.5         “Claims Processor” shall mean SEVARX or a third-party pharmacy claims processor with which SEVARX may contract.

1.6         “Clean Claim” shall mean and refer to a Claim prepared in the standard format promulgated by the NCPDP which contains all of the information necessary for processing, that is compliant with all applicable legal requirements and regulations and is not found to be false, fraudulent, discrepant or otherwise ineligible by SEVARX.

1.7         “Co-payment” or “Cost Sharing Amount(s)” means the amount PHARMACY shall collect from a Member for providing a Covered Prescription Service in accordance with the Member’s Plan.

1.8         “Covered Prescription Services” means the prescriptions and other products and services that may be dispensed or provided by PHARMACY to which a Member is entitled to receive in accordance with and subject to the terms and conditions of the Plan.

1.9         “Dispensing Fee” means the agreed upon rates that SEVARX has agreed to pay PHARMACY for the provision of Covered Prescription Services to a Member. If none is listed herein, the Dispensing Fee shall be zero.

1.10         “Formulary” means the listing of drugs, pharmaceutical products, and devices that is covered by the applicable Plan and that is developed and revised by SEVARX which may be pursuant to direction from the applicable Plan.

1.11         “Generic Drug” shall mean a drug indicated by NADAC as “G” by NADAC’s Classification for Rate Setting.

1.12         “Lowest Market Price” or “LMP” shall mean the lowest price SEVARX pays for a particular Prescription Drug within the Network.

1.13         “Member” means an individual who is enrolled with a Plan Sponsor that is entitled to receive Covered Prescription Services.

1.14         “NADAC” means the National Average Drug Acquisition Cost list as set forth by CMS in the latest edition of the weekly NADAC Price File and based on the most current information then available to SEVARX in its systems at the time of adjudication of the Claim.

1.15         “Network” means the SEVARX’s pharmacy participation network(s) designed to offer access to Covered Prescription Services to Members under Plans.

1.16         “Pharmacy Reimbursement Rates” means the agreed upon rates that SEVARX has agreed to pay PHARMACY for the provision of, and payment for Covered Prescription Services.

1.17         “Plan” means the benefit to Members which may include, but is not limited to any Medicaid, Medicare Part D Plan, or other prescription drug plan, discount card programs and workers compensation programs that are operated, offered or provided by SEVARX or Plan Sponsors that entitle Members to receive reimbursement for, or payment of Covered Prescription Services.

1.18         “Plan Sponsor” means, including, but not limited to, an employer, health insurer, managed care organization, union health and welfare trust, government agency or third-party administrator that operates, offers or provides the Plan(s) through SEVARX.

1.19         “POS System” means the online or real time (point-of-sale) telecommunication system used by PHARMACY to communicate information including, but not limited to, Covered Prescription Services.

1.20         “Prescription Drug” means a pharmaceutical or pharmaceutical compound that under applicable law requires a prescription.

1.21         “Provider Manual” means but is not limited to the guidelines, policies and procedures regarding standards of practice, Plan specifications and additional terms and conditions to the Agreement to which PHARMACY is required to adhere. The Provider Manual is incorporated by reference into this Agreement.

1.22         “Specialty Drugs” means Prescription Drugs that are typically used to treat chronic or complex conditions, and typically have one or more of several key characteristics, including frequent dosing adjustments and intensive clinical monitoring to decrease the potential for drug toxicity and increase the probability for beneficial treatment outcomes; intensive patient training and compliance assistance to facilitate therapeutic goals; limited or exclusive product availability and distribution (if a drug is only available through limited specialty pharmacy distribution it is always considered a Specialty Drug); specialized product handling and/or administration requirements; or costs $600 or more on a monthly basis.  Specialty Drugs may be administered by any route of administration.  Specialty Drugs include biosimilars.  Specialty Drugs shall be deemed those drugs on the SEVARX ‘s Specialty Drug List, and any added to the Specialty Drug List after the Effective Date.

1.23         “Usual and Customary” or “U&C” means the lowest price PHARMACY would charge to a particular customer if such customer were paying cash for the identical Covered Prescription Services on the date dispensed. This includes any applicable discounts, including, but not limited to, advertised or sales prices, price matching, coupons, senior discounts, frequent shopper discounts, pharmacy provider’s savings or discount programs with or without an enrollment fee, any program that offers medication at no cost (e.g. a U&C of $0 should be submitted) and other special discounts offered to attract customers. The PHARMACY is required to report an accurate U&C and must not underreport or conceal U&C for prescription services.

PHARMACY RESPONSIBILITIES

2.1          Participation in Networks. PHARMACY agrees to participate in the Network(s) for Plans and may not terminate its participation in any Network or Plan unless allowed to do so by SEVARX, Plan, or applicable state law.  PHARMACY understands that it is not guaranteed access to all Networks.  If PHARMACY has multiple locations, SEVARX may terminate one or more of PHARMACY’s locations from participating under this Agreement without terminating all PHARMACY locations or the entire Agreement. PHARMACY may be terminated from one or more Networks without terminating PHARMACY from all Networks or this entire Agreement. PHARMACY understands that SEVARX or a Plan may create a custom network that may not include PHARMACY or all of its PHARMACY locations.

2.2          PHARMACY Participation Requirements

2.2.1       Authority to Execute this Agreement.  PHARMACY represents and warrants to SEVARX that the individual executing this Agreement on behalf of the PHARMACY has the legal power and authority to enter into this Agreement and bind obligations of this Agreement, including the addenda, exhibits and Provider Manual,  upon PHARMACY and all of the PHARMACY locations affiliated with PHARMACY in the NCPDP database (if more than one) which will be used by PHARMACY to provide Covered Prescription Services to Members.

2.2.2      Credentialing.  PHARMACY represents and warrants that it regularly monitors the operations at each of its locations and their pharmacists and maintains a credentialing program for itself and all such pharmacies.  SEVARX and its Plans have the right to monitor and oversee PHARMACY’s credentialing program.  Upon providing reasonable advance notice, and applicable state laws and regulations, SEVARX or Plan shall have onsite access to all records related to the credentialing of PHARMACY and all pharmacists or pharmacy personnel which provide Covered Prescription Services to Members.  Further, PHARMACY shall provide SEVARX or Plan with copies of such records.  PHARMACY also agrees to comply with additional credentialing requirements that may be imposed by a Plan. PHARMACY shall submit the information required of it in the applicable credentialing document provided to PHARMACY by SEVARX prior to the Agreement’s execution and thereafter shall provide SEVARX with updated licensing information at least thirty (30) days prior to the renewal date(s).

2.2.3      PHARMACY Information Changes.  PHARMACY shall notify SEVARX and NCPDP of changes regarding PHARMACY operations, ownership, contact information, and its location(s) and will, upon request, provide an updated, complete listing of its participating pharmacy locations.  In addition, PHARMACY shall notify SEVARX of any changes that could, in any way, affect Member access to PHARMACY, including but not limited to significant changes in hours of operation. PHARMACY understands that SEVARX relies on the information in the NCPDP database and certifies that the information contained therein is updated and accurate.

2.2.4      Addition or Deletion of Pharmacies.  PHARMACY shall provide SEVARX with at least thirty (30) days written notice prior to adding a new Pharmacy location, or deleting a Pharmacy location, for use in providing Covered Prescription Services to Members, which new Pharmacy location shall satisfy and comply with all terms and conditions of this Agreement and is subject to SEVARX’s approval.  PHARMACY shall immediately notify SEVARX of a pending or actual termination or suspension of a PHARMACY location(s).  In the event PHARMACY acquires or is acquired by, merges with, or otherwise becomes affiliated with another provider of pharmacy services that is already under contract with SEVARX to participate in SEVARX Network(s), this Agreement and the other agreement will each remain in effect and will continue to apply as they did prior to the acquisition, merger, or affiliation, unless SEVARX decides otherwise in its sole discretion.

2.2.5      Professional Liability Insurance. PHARMACY shall maintain professional liability insurance and general liability insurance in the minimum amounts of One Million Dollars ($1,000,000) per occurrence and Three Million Dollars ($3,000,000) aggregate coverage to insure against any claims for damages in connection with PHARMACY’s provision of services pursuant to this Agreement.  Upon request, PHARMACY shall provide proof of such coverage to SEVARX within ten (10) days of such request.

2.3          Covered Prescription Services

2.3.1      Member Eligibility. Prior to dispensing Covered Prescription Services, PHARMACY shall verify that the person requesting such Covered Prescription Services is an eligible Member entitled to receive such Covered Prescription Services under the Plan. Such verification can be performed by using the POS System.  SEVARX shall not be liable for Covered Prescription Services PHARMACY provides to any person whose eligibility has not been so confirmed at the time such Prescription Drug was dispensed.

2.3.2      Dispensing.  PHARMACY shall and shall ensure that each PHARMACY location verify through the POS System whether the original or refill prescription for a Member is a Covered Prescription Service, provide Covered Prescription Services to each Member in a safe and professional manner and in accordance with applicable laws, benefit design and Formulary of the applicable Plan, this Agreement including the Provider Manual, and any other applicable document(s) or information made available or provided by SEVARX to PHARMACY including payer sheets.

2.3.3      Collection of Co-Pay or Cost Sharing Amounts.  SEVARX or its Claims Processor shall communicate to PHARMACY via POS System the Cost Sharing Amount due from Member for providing a Covered Prescription Service.  PHARMACY shall collect from Member the full Cost Sharing Amount (if any).  PHARMACY agrees that under no circumstances shall it at any time make any charges or claims against any Member, directly or indirectly.  Further, PHARMACY shall not seek reimbursement for Cost Sharing Amounts from SEVARX or Plans, or Plan Sponsors. This Section 2.3.3 shall survive the termination of this Agreement.

2.3.4      Formulary Adherence.  PHARMACY shall use its best efforts, in accordance with terms of this Agreement and applicable laws, to adhere to the Formulary as directed via POS System or other communications from SEVARX or Plan, unless such adherence is prohibited by law.

2.3.5      Generic Drug Dispensing.  PHARMACY shall dispense a Generic Drug Product equivalent for the prescribed Brand Drug Product to the Member so long as such substitution is permitted by applicable state law and so long as Member and Member’s physician has consented to such substitution where required by applicable law.

2.3.6      Drug Utilization Review.  For all Covered Prescription Services provided to Members, PHARMACY shall comply with any and all utilization review, medication therapy management, and other quality assurance programs of SEVARX and Plans whether communicated through the POS System or through another method.

2.3.7      Member Claims and Grievances.  PHARMACY shall immediately notify SEVARX of receipt of any member issues, grievances or claims filed or asserted by a Member against PHARMACY, subcontractor, agent and/or any pharmacist employed or contracted by PHARMACY.  PHARMACY shall cooperate with the Member, SEVARX and/or applicable Plan in identifying, investigating, and resolving all Member complaints, grievances and appeals.

2.3.8      Professional Judgment.  Parties acknowledge that the pharmacist responsible for dispensing Covered Prescription Services shall use his/her best independent professional judgment and such pharmacist may choose to dispense, or refuse to dispense, any prescription based on such judgment. This section shall not be construed as to allow a pharmacist to refuse to dispense a prescription to a Member solely for pharmacy reimbursement reasons or to steer such Member to PHARMACY’s own prescription drug programs.

2.3.9      Non-Discrimination.  PHARMACY shall comply with all applicable laws, rules, regulations and orders prohibiting discriminatory practices, including but not limited to the Americans with Disabilities Act. PHARMACY shall not differentiate or discriminate in the treatment of any Member because of the Member’s race, color, national origin, ancestry, religion, health status, sex, marital status, age, disability/handicap, sexual orientation, source of payment, or any other basis prohibited by law; and PHARMACY shall render services to Members in the same manner and in accordance with the same standards as offered to any other customer of PHARMACY.

2.3.10    Records.  PHARMACY shall keep and maintain records that comply with state and federal law, rules and regulations relating to Covered Prescription Services provided to Members under this Agreement for ten (10) years following the date of service or last date of this Agreement, whichever is later unless the time frame is extended for reasons specified by regulation or applicable law.

2.3.11    Signature Log. PHARMACY shall maintain a signature log that contains all of the customary information necessary for SEVARX to confirm proper receipt of the Covered Prescription Services including but not limited to the prescription number for the underlying Covered Prescription Service, the date on which the Claim was approved, the date on which the prescription was dispensed, the product dispensed, Cost Sharing Amounts, an authorization for release of information to SEVARX and Plan Sponsor in order to process the Claim and the signature of the Member or authorized agent (where permitted by law) confirming receipt of the prescription. PHARMACY shall maintain the signature log for a period of not less than ten (10) years or such longer period of time as mandated by applicable law. If PHARMACY chooses to use an alternative method for documentation of receipt of Covered Prescription Services, PHARMACY shall provide sufficient information to SEVARX whereby SEVARX will determine in its sole discretion whether such alternative method is acceptable.  Any such approval shall be obtained from SEVARX in writing.

2.4          Compliance

2.4.1      Licenses and Permits. PHARMACY represents and warrants that it has a compliance monitoring program through which it verifies, licenses and ensures as well as reviews any disciplinary actions (including without limitation debarment, exclusion or conviction) related to its locations or pharmacy personnel and takes appropriate measures to address any such disciplinary actions. PHARMACY shall obtain and maintain all federal, state and local approvals, licenses, accreditation, permits and certifications required to operate as a pharmacy at each location.  PHARMACY shall ensure that all pharmacists and pharmacy personnel that are contracted or employed by PHARMACY are properly licensed and maintain all necessary credentialing requirements to provide Covered Prescription Services.  All services shall be performed in accordance with the applicable standards of practice and in an ethical manner. PHARMACY shall provide SEVARX with (i) updated information related to the aforementioned approvals, licenses, accreditation, permits and certifications upon request by SEVARX or within thirty (30) days of any change to such information, but no less frequently than annually, (ii) notice within two (2) days of any suspension, revocation, condition, limitation or other restriction imposed on any of its licenses, permits, accreditation or certifications and (iii) notice within two (2) days of any suspension, revocation, condition, limitation, or other restriction on any pharmacist-in-charge’s license.

2.4.2      Regulatory Compliance.  PHARMACY and each of its locations, pharmacists and other pharmacy personnel shall be responsible for determining and complying with all applicable laws and  regulations that govern the provision of Covered Prescription Services and all other laws that may be implicated pursuant to the terms and obligations of this Agreement including without limitation any Plan Sponsor specific regulatory or legal provisions. Without limiting the generality of the foregoing, if any provision is required to be included in this Agreement by any law, regulation or related guidance applicable to Plan Sponsor(s), then SEVARX shall be entitled to unilaterally amend this Agreement to incorporate such provision without further action by the Parties. If a Party’s required performance under this Agreement is prohibited by or in conflict with any applicable law or regulation, then such Party shall only be required to perform to the extent allowed by such law or regulation. For the avoidance of doubt, any provision now or hereafter required to be included in this Agreement by any applicable law or regulation or any government authority of competent jurisdiction shall be deemed incorporated herein and binding upon and enforceable against the Parties whether or not such provision is expressly addressed in this Agreement or Provider Manual.

2.4.3      Debarment/Exclusion.  PHARMACY represents and warrants that neither the PHARMACY nor, to the best of PHARMACY’s knowledge, any PHARMACY location, pharmacist, subcontractor, or other personnel providing Covered Prescription Services to Members have been or will be debarred, excluded, or otherwise ineligible for participation in any state or federal health care programs or convicted of a felony.  If at any time PHARMACY becomes aware of any violation of this representation and warranty, PHARMACY shall notify SEVARX immediately in writing and shall prevent such personnel or PHARMACY location from providing Covered Prescription Services to Members. SEVARX reserves the right to immediately terminate the PHARMACY location from participating in its Networks or this Agreement.

2.4.4      Provider Manual.  PHARMACY shall comply with the Provider Manual.  Any of the rules, policies, procedures and guidelines adopted by SEVARX may be provided in the Provider Manual which may be modified from time to time. Any such changes are effective upon notice to PHARMACY or publication of the updated Provider Manual to SEVARX’s website or other means as determined by SEVARX and shall be binding on PHARMACY.

2.4.5      Mailing/Courier Prohibition.  PHARMACY represents that its primary method of dispensing or distributing Prescription Drugs, devices, or non-prescription drugs is not by mail or other common carrier, unless specifically approved in writing to do so by SEVARX and shall not solicit a Member to use PHARMACY’s mail delivery.

2.4.6       Unrequested Prescription Transfers. PHARMACY may only transfer a Member’s prescription(s) to another pharmacy upon the express consent of the Member, SEVARX or applicable Plan. Furthermore, to fullest extent allowed by applicable law, PHARMACY shall not solicit a Member to transfer any prescription to another pharmacy whether or not that other pharmacy is an affiliate of PHARMACY and regardless of the other pharmacy type. Notwithstanding the foregoing, in the event the transfer is due to the opening or termination or closing of a pharmacy currently providing services to Members, this section shall not apply.

2.4.7      SEVARX’s Plan Sponsors. PHARMACY shall not advise, counsel or solicit any Plan Sponsor to end or alter its relationship with SEVARX for any reason including but not limited to improving PHARMACY reimbursement.

2.4.8       Solicitation of Members. PHARMACY shall not advise, counsel or solicit any Members to end participation with their Plan Sponsor and shall not discourage or disparage the use of any program offered by a Plan Sponsor for any non-clinical reason including but not limited to improving PHARMACY reimbursement. PHARMACY shall not acquire patients via cold calling, unsolicited methods of acquiring a patient’s billing information, or by offering to contact the patient’s prescriber. Submission of Claims (either initial or refills) must be made with the Member’s knowledge and authorization.

2.5         Delegation. PHARMACY understands that SEVARX relies on PHARMACY to provide the services contemplated herein. Accordingly, PHARMACY shall not delegate any service, activity or obligation required of it in this Agreement to an Affiliate or third party without the express written consent of SEVARX (which such consent shall not be deemed to create any liability for SEVARX unless required by applicable law) and any applicable Plan Sponsor as necessary. Such consent shall not be given until SEVARX has been provided with a copy of the agreement between PHARMACY and the delegate that includes provisions stating (i) that the agreement will terminate immediately if SEVARX or Plan Sponsor revokes its consent on the delegation and (ii) that the delegate shall perform its services in accordance with the contractual requirements and obligations of any applicable Plan Sponsor, SEVARX and this Agreement.

SEVARX RESPONSIBILITIES

3.1          Process Claims and Payment.  SEVARX shall process and arrange for payment of Clean Claims in the manner prescribed by this Agreement and subject to payment of such Claims by the applicable Plan Sponsor.  SEVARX may contract with a third party for claims processing or other obligations SEVARX has agreed to provide pursuant to the terms of this Agreement.

3.2          Right to Audit.

3.2.1      Records. In accordance with industry standards and practices, applicable law, boards of pharmacy requirements, Plan Sponsor requirements, and this Agreement, PHARMACY shall keep and maintain accurate and complete records and accounts of all transactions including patient records and information, data, purchase verification information, prescription files and other related and applicable files, drug purchase invoices, signature logs, records to validate U&C and other related documents related to the provision of Covered Prescription Services (collectively “Records”).  PHARMACY shall maintain all such Records for at least ten (10) ten years from the date the Covered Prescription Service is dispensed or longer if required by law Plan Sponsor or government authority.

3.2.2      Access.  Upon reasonable notice as required by law and when possible for audits where fraud, waste or abuse is not suspected, during PHARMACY’s regular business hours, and subject to applicable state and federal laws regarding the confidentiality of records, SEVARX or its authorized agent, Plan Sponsors, government authorities and their authorized representatives (“Auditor(s)”) shall have the right, for the term of the Agreement and for two (2) years thereafter (or such longer or shorter period of time as mandated by applicable law or a government program), either onsite, via desktop, telephonic, or other means, to review, audit, examine, and reproduce any of the PHARMACY’s records related to the provision of Covered Prescription Services pursuant to this Agreement, including but not limited to: accuracy of Claims, appropriateness of billing, investigation of Member grievances or complaints, compliance with quality assurance, and compliance with other SEVARX and Plan programs.  PHARMACY shall provide the information necessary for any such audit at its own cost.

3.2.3      Audit Results. With the exception of telephone audits, SEVARX or the Auditors shall notify PHARMACY in writing of the audit findings based on the documentation provided to SEVARX or the Auditors (“Initial Audit Report”). PHARMACY shall have thirty (30) days or longer, as required by law, from the date of the Initial Audit Report to provide supplemental information which shall be reviewed and SEVARX or the Auditors shall determine whether such information is acceptable based on terms of this Agreement, Plan specific requirements, or Provider Manual requirements. Except for telephone audits, based on PHARMACY’s response to the Initial Audit Report, SEVARX or the Auditor’s shall issue a Final Audit Report which shall include the final findings, remaining audit discrepancies, methods used to calculate such discrepancies, and any payments due to SEVARX.  SEVARX may offset any amounts owed from future payments to PHARMACY or PHARMACY shall have thirty (30) days from the date of the Final Audit Report to reimburse SEVARX for such amounts. In the event SEVARX or the Auditors in their sole discretion finds that any errors or audit discrepancies are material or based on fraud, waste or abusive practices, PHARMACY shall pay to SEVARX all reasonable costs incurred in connection with the audit, including costs and expenses incurred to identify and correct such errors and/or discrepancies.

3.2.4      In the event PHARMACY disputes the Final Audit Report findings, PHARMACY may request a review within thirty (30) days or longer if required by law after receiving the Final Audit Report.  Guidelines for this process are outlined in the Provider Manual.

COMPENSATION AND BILLING

4.1          Compensation.  For Covered Prescription Services performed in accordance with the term and conditions of this Agreement, SEVARX shall pay PHARMACY the Pharmacy Reimbursement Rates and Dispensing Fees as forth in Exhibit A, less the applicable Cost Sharing Amount.  Note that Pharmacy Reimbursement Rates and Dispensing Fees vary from Plan to Plan.  Refer to Exhibits, Addendums, Schedules, Provider Manual, or the on-line transaction response for Plan or network reimbursement. The on-line transaction response pricing prevails, unless an overpayment is made to PHARMACY.  Compensation is determined based on the NADAC price for the specific 11-digit NDC number or equivalent NDC from a different manufacturer for a particular Prescription Drug and paid at the lesser of: the Plan or Network specific Pharmacy Reimbursement Rates or other reference based pricing plus applicable Dispensing Fee, PHARMACY’s submitted cost amount, LMP or PHARMACY’s U&C. Approved Claims for Covered Prescription Services shall be paid on average thirty (30) days from the date SEVARX determines that PHARMACY submitted a Clean Claim to SEVARX according to the following cycle: Clean Claims submitted between the first day of the month and the fifteenth day of the month shall be paid no later the seventh day of the following month, and Clean Claims submitted between the sixteenth day of the month and the last day of the month shall be paid no later than the twenty first day of the following month. Additional information on rejected or disputed Claims shall be submitted to SEVARX within fourteen (14) days of SEVARX’s request for such information.  SEVARX reserves the right to refuse payment of any such Claims that are not submitted within the time periods provided. The above payment timelines for Clean Claims shall be modified as needed to comply with State specific laws, rules, and regulations.  

4.2          Incorrect Payments.  SEVARX may make adjustments to recoup from PHARMACY any overpayments made or to address any errors in the POS System either via offsetting such overpayment amount from future payments to PHARMACY, or requiring PHARMACY to remit payment to SEVARX within thirty (30) days of notice of overpayment.  PHARMACY acknowledges that it is obligated to review remittances received from SEVARX to confirm accuracy.  PHARMACY shall have thirty (30) days from receipt of a remittance to review and notify SEVARX of any discrepancy.  Otherwise, PHARMACY will be deemed to have confirmed the accuracy of payments made by SEVARX for Claims processed pursuant to such remittance.

4.3          Payment in Full.   The Pharmacy Reimbursement Rate plus Dispensing Fee in addition to any Cost Sharing Amount for which a Member is responsible for based on their Plan, shall be considered full and final payment for the Covered Prescription Service rendered. PHARMACY shall not seek any further payment from Member, SEVARX, or Plan regardless of the payment amount or whether such amount is less than PHARMACY’s U&C.

4.4          Claims Submission.  PHARMACY shall only be compensated for Clean Claims that are electronically submitted via POS System in real time to Claims Processor for Covered Prescription Services dispensed.  A Clean Claim must be submitted to Claims Processor within thirty (30) days of the date of service. A Claim shall not be considered a “Clean Claim” if SEVARX determines in its sole discretion that such Claim is discrepant, false and/or fraudulent, by an individual not authorized under applicable law or regulation to write or direct the related prescription, or written or directed by an individual who is excluded from participation in any federal health care program. Additionally, any Claim that is mailed in violation of this Agreement shall not be considered a “Clean Claim”.

4.5          Fees.  PHARMACY may be subject to and is solely responsible for the payment of any and all transaction fees that may be associated with transmitting Claims to the Claims Processor as further outlined in Exhibit A.  Further, PHARMACY may incur other fees associated with Claims reversals, or other services provided by Claims Processor in relation to Claims transmission and payments. Any of the transaction fee amounts listed in Exhibit A may be modified by SEVARX in its sole discretion upon at least thirty (30) days prior written notice to PHARMACY.

4.6          Claim Adjustments.  PHARMACY shall electronically adjust all credits, duplicate claims, returned, and unclaimed prescriptions within fourteen (14) calendar days after the original fill date. Failure to dispense claims within guidelines may result in audit and/or reversal of affected claims.

4.7          Hold Harmless.  PHARMACY agrees that under no circumstances may PHARMACY make any charges or claims against any Member, directly or indirectly, for Covered Prescription Services, with the exception of permitted Co-payments and/or Cost Sharing Amounts; and in no event, including but not limited to non-payment by SEVARX or a Plan, the insolvency of SEVARX and/or a Plan, termination of this Agreement or breach of this Agreement, may PHARMACY bill, charge, collect a deposit from, seek compensation, remuneration or reimbursement from, or have any recourse against Members. This Section shall survive termination of the Agreement.

4.8          SEVARX Disclaimer of Liability.  PHARMACY acknowledges and agrees that SEVARX operates as an intermediary between Plans and PHARMACY with respect to payments due under this Agreement and that Claim Pharmacy Reimbursement Rates and Dispensing Fee amounts due hereunder are the sole and exclusive responsibility of Plans Sponsors. PHARMACY further acknowledges and agrees that SEVARX is not obligated to pay PHARMACY for Claims relating to a Plan if a Plan Sponsor fails to provide SEVARX with payment related to Claims, and SEVARX has no liability to PHARMACY for non-payment or for any delay in payment from a Plan Sponsor.

TERM AND TERMINATION

5.1          Term.  This Agreement shall commence upon the date written above (“Effective Date”) and shall continue uninterrupted unless terminated pursuant to the terms set forth below.

5.1.1.     Termination With Cause. In the event that a Party materially breaches the terms of this Agreement, the Non-Breaching Party may terminate this Agreement if the other Party has failed to cure such breach within thirty (30) calendar days after the non-breaching Party gives written notice of such breach.

5.1.2      Termination Without Cause. SEVARX may terminate this Agreement or any individual Network, exhibit, amendment or addendum by providing PHARMACY thirty (30) calendar days advance written notice (or such longer notice period as required by applicable law). Termination of any individual Network, exhibit, amendment or addendum shall not be deemed to be a termination of this Agreement as it relates to other non-terminated Networks, exhibits, amendments or addenda.

5.1.3      Immediate Termination. Notwithstanding the above, this Agreement may be immediately terminated by SEVARX in the event of any of the following: (i) loss or revocation of PHARMACY’s license at one or all of its locations, loss of required liability coverage or other failure by PHARMACY to satisfy credentialing requirements; (ii) reasonable suspicion of fraud or fraudulent billing practices by PHARMACY, its employees, contractors, or agents; (iii) PHARMACY or any of its principals becomes or is excluded from participating from any government programs; (iv) PHARMACY engages in any conduct tending to injure the business reputation of SEVARX, or which may pose a threat to the health, safety or well-being of Members; (v) SEVARX determines in its sole discretion that PHARMACY or any of its pharmacies or personnel have violated SEVARX’s policies and procedures including without limitation, rejecting or redirecting Members to other programs at the point of sale for any non-clinical reason, implementing any systematic block of Plans or any automated reversal process; or (vi) PHARMACY otherwise is unable to fulfill its obligations pursuant to the terms of this Agreement.  Note that for PHARMACY with multiple locations, SEVARX or a Plan Sponsor may suspend, revoke or terminate one or more pharmacy locations, but not all PHARMACY locations from participation in one or more or all Networks. The termination of one or more PHARMACY locations shall not prevent any subsequent termination of this Agreement or any individual PHARMACY location by SEVARX. Any non-terminated PHARMACY locations shall continue to provide the services and obligations of this Agreement and any related documentation.

5.1.4      Bankruptcy. Either PHARMACY or SEVARX may terminate this Agreement immediately upon delivering written notice to the other Party in the event the other Party makes an assignment for the benefit of creditors, files a petition in bankruptcy, or is adjudicated insolvent or bankrupt.

5.1.5      Termination and Appeal. In the event of termination by SEVARX, SEVARX shall provide written notice to PHARMACY describing the reasons for termination and, if applicable, information regarding the termination appeal process.

5.2          Effect of Termination. Unless otherwise stated herein, termination of the Agreement shall not impact the obligations and rights of the Parties with respect to transactions that occurred prior to the effective date of Termination. SEVARX reserves the right to notify Plan Sponsors and/or Members regarding any termination, suspension or revocation and PHARMACY agrees to cooperate with SEVARX and/or Plan Sponsors.

MEDICARE PART D

6.1          Medicare Part D Pharmacy Network Requirements.  Pharmacies participating in SEVARX’s Medicare Part D pharmacy network must comply with the following terms and conditions.  Capitalized terms used herein but not otherwise defined elsewhere in this Agreement shall have the meanings set forth in applicable federal regulations and CMS guidelines.  Should Pharmacy not participate in SEVARX’s Medicare Part D network, this Section 6 shall not modify PHARMACY’S current relationship with SEVARX.

Any Covered Prescription Services provided by PHARMACY in connection with a Medicare Part D Sponsor’s Medicare Part D plan will be consistent and comply with the Plan Sponsor’s contractual obligations as a Medicare Part D Sponsor.  42 CFR § 423.505(i)(3)(iii).

In the event PHARMACY delegates any activity or responsibility related to the provision of Covered Prescription Services to subcontractor(s), the subcontractor(s) will be subject to the terms and conditions of this Agreement.  PHARMACY will ensure its agreements with subcontractor(s), if any, provide that the subcontractor(s) will comply with all of the terms and conditions of this Agreement.  42 CFR § 423.505(i)(3) and (4).  Notwithstanding the provisions of this paragraph, PHARMACY shall not delegate services under this Agreement, unless it receives written permission from SEVARX.

Medicare Part D Sponsors retain ultimate responsibility for complying with the terms of their CMS contract.  42 CFR § 423.505(i).

6.1.1      Requirements Applicable to All Providers.  PHARMACY agrees to participate in the Medicare Part D prescription drug benefit program(s) administered by SEVARX and to provide Covered Prescription Services to Members, pursuant to the terms and conditions of this Agreement.

• PHARMACY shall not employ or contract for the provision of Covered Prescription Services with any individual or entity excluded from participation in the Medicare and Medicaid program under Section 1128 or 1128A of the Social Security Act. PHARMACY certifies that no such excluded person currently is employed by or under contract with PHARMACY.  PHARMACY shall review the Office of Inspector General and General Services Administration exclusion files and verify on a monthly basis, or as often as required by CMS guidelines, that the persons it employs for Covered Prescription Services are in good standing.  42 CFR § 423.752(a)(6); Prescription Drug Benefit Manual, Ch. 9 section 50.6.8.  Each year during the Term of this Agreement, or as often as required by CMS, PHARMACY shall provide a written attestation to SEVARX confirming PHARMACY’S compliance and PHARMACY’S subcontractors’ (if any) compliance with the requirements of this paragraph.  PHARMACY shall immediately disclose to SEVARX any debarment, exclusion, or other event that makes its employees or subcontractor(s) ineligible to perform work related to federal healthcare programs.
• PHARMACY must distribute written notice instructing Members to contact their Medicare Part D plan to obtain a coverage determination or request an exception if the Member disagrees with the information provided by the PHARMACY. PHARMACY must use the form notice (Form No. CMS-10147 entitled “Medicare Prescription Drug Coverage And Your Rights”) and may not deviate from the content of this notice.  42 CFR § 423.562(a)(3).
  • Retail Pharmacies – The notice must be provided to the Member at the point-of-sale if the PHARMACY receives an online adjudication system transaction response of rejected or paid indicating the claim is not covered by Part D. The notice instructs Members about their right to contact their Part D plan to request a coverage determination, including an exception.
  • Mail Order Pharmacies – The notice must be delivered to the Member via the Member’s preferred method of communication (fax, electronic, or first class mail) as expeditiously as the Member’s health condition requires, but no later than seventy-two (72) hours from the PHARMACY’s receipt of the original transaction response indicating the claim is not covered by Part D.
• PHARMACY must report compliance concerns and suspected or actual misconduct related to the Medicare Part D program. PHARMACY may report fraud, waste, and abuse anonymously to SEVARX’s confidential Medicare Fraud, Waste, and Abuse email address at cnichols@sevarx.com or by calling 219-881-8397 x2165.  PHARMACY’S filing of a report in good faith will not receive reprisal of any sort whatsoever.  PHARMACY is protected from retaliation for complaints filed in good faith under the False Claims Act, as well as by other applicable federal and state anti-retaliation protections.  31 U.S.C. § 3730(h).
• PHARMACY shall submit a report in writing to SEVARX within thirty (30) days of PHARMACY’s knowledge of any and all civil judgements and other adjudicated actions or decisions against the PHARMACY related to the delivery of any healthcare item or services (regardless of whether the civil judgement or other adjudicated action or decision is the subject of a pending appeal).
• In accordance with CMS guidelines, payments made for a Member’s Cost Sharing Amount by any entity – including a safety net provider – that has an obligation to pay for covered Medicare Part D drugs on behalf of Medicare Part D Members, or which voluntarily elects to use public funds for that purpose, will not count toward that Member’s True Out-of-Pocket costs (“TrOOP”) expenditures. PHARMACY shall let SEVARX know of the Member, and if any of the Claim(s) for which the Cost Sharing Amount is waived, so that SEVARX may delete those amounts from the Member’s TrOOP as required under the Medicare Part D program.
• PHARMACY will comply with applicable federal and state laws and regulations and CMS instructions. 42 CFR § 423.505(i)(4)(iv).
• PHARMACY will comply with state and federal privacy and security requirements, including the confidentiality and security provisions stated in Medicare Part D regulations at 42 CFR § 423.136.
• PHARMACY will maintain, for the current contract period and ten (10) prior years, all books, contracts, medical records, patient care documentation, and other records of PHARMACY relating to Covered Prescription Services, in their original format for the greater of three (3) years of the period required by state law and allow those records to be transferred to an electronic format that replicated the original prescription for the remaining seven (7) of the 10-year record retention requirement. 42 CFR § 423.505(d); CMS Application (Records Retention).
• PHARMACY will give the U.S. Department of Health and Human Services (“HHS”) and U.S. Comptroller General, and their authorized designees, the right to inspect, evaluate, collect, and audit all books, contracts, computers or other electronic systems, medical records, patient care documentation, and other records relating to Medicare Part D Covered Prescription Services during the Term of this Agreement and for a period of ten (10) years following termination or expiration of this Agreement for any reason, or until completion of any audit, whichever is later. This provision shall survive termination of the Agreement.  PHARMACY agrees that CMS or its designees may have direct access to PHARMACY’S books, contracts, systems, records, including medical records and documentation relating to the Medicare Part D program, on PHARMACY’s premises.  42 CFR § 423.505(i)(2).  HHS, the Comptroller General, or their designees have the right to audit, evaluate, collect, and inspect any records under this section directly from SEVARX, the Plan Sponsor, or a related entity, as applicable.
• PHARMACY will ensure Members are not held liable for fees that are the responsibility of SEVARX. PHARMACY agrees that in no event, including, but not limited to, nonpayment by SEVARX, SEVARX’S insolvency, or SEVARX’S breach of this Agreement, shall PHARMACY or its subcontractors bill, charge, or collect a deposit from, seek compensation, remuneration, reimbursement, or payment from, or have recourse against Members for Covered Prescription Services provided pursuant to this Agreement.  This provision shall not prohibit the collection Cost Sharing Amounts or charges for non-Covered Prescription Services, where applicable.  PHARMACY further agrees that this provision shall survive the termination of this Agreement, regardless of the cause giving rise to termination and shall not be construed to be for the benefit of the applicable Member(s).  42 CFR § 423.505(i)(3)(i).  In addition, PHARMACY understands and agrees that dual eligible (Medicare/Medicaid) Members may not be responsible for any or may only be responsible for reduced Cost Sharing Amounts for Medicare Part D Covered Prescription Services.
• If CMS, SEVARX, or a Medicare Part D Sponsor contracted with SEVARX determines that PHARMACY has not performed satisfactorily under this Agreement, CMS, SEVARX, or Plan Sponsor may revoke any of the activities or reporting responsibilities delegated to PHARMACY by this Agreement. 42 CFR § 423.505(i)(4)(ii).
• SEVARX and Medicare Part D Sponsor will monitor the performance of PHARMACY on an ongoing basis, including, but not limited to, ongoing audits performed by or on behalf of SEVARX, which assess whether PHARMACY is in compliance with Medicare Part D requirements. 42 CFR § 423.505(i)(4)(iii).  PHARMACY will give SEVARX the right to inspect, evaluate, and audit all books, contracts, medical records, patient care documentation, and other records, and PHARMACY shall cooperate with SEVARX and Medicare Part D Sponsor as necessary to support SEVARX’s and Medicare Part D Sponsor’s monitoring strategy.  If PHARMACY refuses to provide documentation as requested by SEVARX to demonstrate compliance with this Agreement and CMS’s directives, SEVARX reserves the right to assess up to a $500 per day fee per PHARMACY location until the requirement has been met.
• Payment of Claims. With respect to Medicare Part D Claims only, SEVARX shall post, mail, or otherwise transmit payment to PHARMCY for Clean Claims submitted by PHARMACY (with the exception of claims submitted by mail order pharmacies or by pharmacies that are located in, or contracted with, a long-term care facility) as follows:
  • For Clean Claims submitted electronically, fourteen (14) calendar days after the date on which the Clean Claim is received by SEVARX; and
  • For Clean Claims submitted in a format other than electronically, thirty (30) calendar days after the date on which the Clean Claim is received by SEVARX.
  • For purposes of this subsection, “Date of Receipt of Claim” shall mean: (a) for Claims submitted electronically, the date on which the Claim is transferred; and (b) for Claims submitted in a format other than electronically, on the fifth (5^th) day after the postmarked date of the Claim or the date specified in the time stamp of the transmission, whichever is sooner.
• Mail order pharmacies are required to have protocols in place to ensure Member access to urgently needed medications.
• PHARMACY shall submit each Claim to SEVARX, online and at the point-of-sale, in the most current NCPDP format for processing and payment, and in accordance with this Agreement, unless the Member expressly requests that the Claim not be submitted online and instead opts to pay the full cost at the point-of-sale. 42 CFR 423.120(c)(3).  PHARMACY will exercise professional judgement and follow quality practice standards in performing a drug utilization review (“DUR”) based on a discussion with the Member and a review of PHARMACY’S patient profile for that Member.
• PHARMACY will submit Claims for Members through the POS System. 42 CFR § 423.505(b)(17).  In the event PHARMACY submits claims data on behalf of SEVARX, PHARMACY, in addition to SEVARX, will certify to CMS regarding the accuracy, completeness, and truthfulness of the data and acknowledge that the claims data submitted on behalf of SEVARX will be used for the purposes of obtaining federal reimbursement.
• As communicated through the POS System, PHARMACY will provide Members with access to negotiated pricing and charge Members the correct Cost Sharing Amount, including that which applies to individuals qualifying for low income subsidy as indicated through the POS System. 42 CFR 423.104(g)(1).
• Unless otherwise required or allowed by law, PHARMACY will inform Members of any differential in price between the Medicare Part D covered drug being purchased and the lowest-priced Generic Drug that is therapeutically equivalent and bioequivalent, and available at the PHARMACY, if one exists. PHARMACY must provide this notice after the drug is dispensed at point-of-sale or, in the case of dispensing by mail service, at the time of delivery of the drug.  42 CFR § 423.132.
• PHARMACY agrees to cooperate with all quality assurance activities designed to reduce medication errors and adverse drug interactions as required by CMS or SEVARX, including, but not limited to, establishing an internal medication error identification and reduction system. 42 CFR § 423.153(c)(4).
• PHARMACY-initiated activities are activities conducted by PHARMACY at the request of the Member, or as a matter of a course of treatment, and occur when meeting with the Member as part of the professional relationship between PHARMACY and Member. Permissible activities include:
  • Distributing unaltered, printed materials created by CMS, such as reports from Medicare Plan Finder, the “Medicare & You” handbook, or “Medicare Options Compare” (from https://www.medicare.gov) including in areas where care is delivered.
  • Providing the names of Part D Sponsors with which they contract or participate or both.
  • Answering questions or discussing the merits of a Part D plan or plans, including Cost Sharing Amounts and benefit information including in areas where care is delivered.
  • Referring Members to other sources of information, such as State Health Insurance Assistance Program representatives, plan marketing representatives, State Medicaid Office, local Social Security Offices, CMS’s website at https://www.medicare.gov, or 1-800-MEDICARE.
  • Referring Members to Part D marketing materials available in common areas.
  • Providing information and assistance in applying for the low-income subsidy.
  • Announcing new or continuing affiliations with Part D Sponsors, once a contractual agreement is signed. Announcements may be made through any means of distribution. 42 CFR § 423.2266(c).
• PHARMACY shall not refuse to provide services or attempt to disenroll any Member, or deny, limit, or condition coverage or the furnishing of Covered Prescription Services to Members based on health factors such as medical condition (including mental as well as physical illness), claims experience, receipt of health care, medical history, genetic information, evidence of insurability (including conditions arising out of acts of domestic violence), and disability. 42 CFR § 423.505(b)(3).
• Member data may not be used by PHARMACY to market or sell any other goods or services.
• PHARMACY shall complete the following steps if overriding CMS’s Opioid Care Coordination edit: PHARMACY shall consult with the prescriber and document discussion; if the prescriber confirms intent and PHARMACY agrees with said therapy, PHARMACY may submit the appropriate override code. PHARMACY is cautioned that they shall only submit an override code upon completion AND documentation of the care coordination activities.  Existence of documentation on overridden edits is subject to auditing by SEVARX.  In conjunction with this edit, PHARMACY is encouraged to review the patient’s record in their state’s Prescription Drug Monitoring Program.
• PHARMACY shall comply with the following provisions if performance of services will occur at any offshore location. For purposes of this section “performance of services offshore” means if PHARMACY or an approved subcontract receives, processes, transfers, handles, stores or accesses SEVARX data at any offshore location (i.e. outside of the United States or the U.S. territories).
  • PHARMACY will have in place and implement policies and procedures to ensure that the personally-identifiable information with respect to Members remains secure;
  • PHARMACY will be prohibited from accessing (a) data which is not associated with SEVARX’s Medicare business; or (b) other SEVARX data which is not required for PHARMACY to perform services.
  • SEVARX will have the right to terminate this Agreement immediately upon notice to PHARMACY upon the discovery of a significant security breach related to PHARMACY’s offshore activities, which right will be in addition to any other termination rights that SEVARX has under this Agreement.
  • SEVARX will have the right to conduct an audit, at least annually, of PHARMACY’s offshore activities to enable SEVARX to evaluate the continuation of its relationship with PHARMACY, which right will be in addition to SEVARX’s other audit rights under this Agreement, and SEVARX will share the results of such audits with CMS upon its request in accordance with applicable law.
  • PHARMACY will ensure that the provisions set forth in this section are included in binding executed agreements between PHARMACY and any and all of its offshore subcontractors to which it has delegated the performance of any services (if delegation is permitted by SEVARX).
  • PHARMACY will examine options that would enable it to reduce or eliminate its need to access personally identifiable information offshore, determine the feasibility of such options, and present all such reasonable options to SEVARX for consideration.

6.1.2      Requirements Applicable to Long-Term Care Pharmacies.

• PHARMACY shall have at least thirty (30) days and up to ninety (90) days to submit Claims to SEVARX for payment of Medicare Part D Claims. 42 CFR § 423.505(b)(20).
• PHARMACY must dispense drugs and report information as required by 42 CFR § 423.154.
• When the Member is not the person presenting the prescription directly to the pharmacist or the PHARMACY’s staff, PHARMACY shall comply with the following CMS requirement. When there is an issue with the requested prescription order, the physician or other prescriber may prescribe a different medication or request for an exception through the Medicare Part exception process: (a) if PHARMACY is offsite of the LTC facility, PHARMACY must send (fax or deliver) the Form No. CMS-10147 entitled “Medicare Prescription Coverage And Your Rights” notice to the Member, the Member’s representative, prescriber, or an appropriate staff person at the LTC facility as expeditiously as the Member’s health condition requires, but no later than seventy-two (72) hours from the PHARMACY’s receipt of the original transaction response indicating that the drug is not covered by Part D; (b) if PHARMACY is onsite at the LTC facility, PHARMACY must deliver the notice to the location in the LTC facility designated to accept the notice.  PHARMACY should indicate to the LTC facility staff that the LTC facility staff is responsible for providing the Member (or his or her representative) and his or her treating physician with the notice consistent with the timing set forth in (a) above and for placing a copy of the notice in the Member’s file at the LTC facility.  42 CFR § 423.562(a)(3).
• Performance and Service Criteria Specific to Long Term Care Pharmacies.
  • Comprehensive Inventory and Inventory Capacity. PHARMACY must provide a comprehensive inventory of SEVARX’S and Sponsors’ formulary drugs commonly used in the long term care setting.  In addition, PHARMACY must provide a secure area for physical storage of drugs, with the necessary added security as required by federal and state law for controlled substances.  This is not to be interpreted that the PHARMACY will have inventory or security measures outside the normal business setting.
  • Pharmacy Operations and Prescription Orders. PHARMACY must provide the services of a dispensing pharmacist to meet the requirements of pharmacy practice for dispensing prescription drugs to LTC residents, including, but not limited to, the performance of DUR.  In addition, PHARMACY must conduct DUR to routinely screen for allergies and drug interactions, to identify potential adverse drug reactions, to identify inappropriate drug usage in the LTC population, and to promote cost effective therapy in the LTC setting.  PHARMACY must also be equipped with pharmacy software and systems sufficient to meet the needs of prescription drug ordering and distribution to an LTC facility.  Further, PHARMACY must provide written copies of the PHARMACY’S policies and procedures manual and said manual must be available at each LTC facility nurses’ unit.  PHARMACY is also required to provide ongoing in-service training to ensure that LTC facility staff is proficient in the PHARMACY’s processes for ordering and receiving medications.  PHARMACY must be responsible for return and reuse, and/or disposal of unused medications following discontinuance, discharge, or death as permitted by State Boards of Pharmacy.  Controlled substances and out-of-date substances must be disposed of within state and federal guidelines.
  • Special Packaging. PHARMACY must have the capacity to provide specific drugs in Unit of Use Packaging, Bingo Cards, Cassettes, Unit Dose or other special packaging commonly required by LTC facilities.  PHARMACY must have access to, or arrangements with, a vendor to furnish supplies and equipment including, but not limited to, labels, auxiliary labels, and packing machines for furnishing drugs in such special packaging required by the LTC setting.
  • IV Medications. PHARMACY must have the capacity to provide IV medications to the LTC resident as ordered by a qualified medical professional.  PHARMACY must have access to specialized facilities for the preparation of IV prescriptions (clean room).  Additionally, PHARMACY must have access to or arrangements with a vendor to furnish special equipment and supplies as well as IV trained pharmacists and technicians as required to safely provide IV medications.
  • Compounding/Alternative Forms of Drug Composition. PHARMACY must be capable of providing specialized drug delivery formulations as required for some LTC residents.  Specifically, residents unable to swallow or ingest medications through normal routes may require tablets split or crushed or provided in suspensions or gel forms, to facilitate effective drug delivery.
  • Pharmacist On-Call Service. PHARMACY must provide on-call, 24-hours a day, 7 days a week service with a qualified pharmacist available for handling calls after hours and to provide medication dispensing available for emergencies, holidays, and after hours of normal operations.
  • Delivery Service. PHARMACY must provide for delivery of medications to the LTC facility up to 7 days each week (up to 3 times per day) and in between regularly scheduled visits as needed for emergencies. Emergency delivery service must be available 24 hours per day, 7 days a week.  Specifically, delivery arrangements will be determined through an agreement between the PHARMACY and the LTC facility.  PHARMACY must provide safe and secure exchange systems for delivery of medication to the LTC facility.  In addition, PHARMACY must provide medication cassettes, or other standard delivery systems, that may be exchanged on a routine basis for automatic restocking.  The PHARMACY delivery of medication to carts is a part of routine “dispensing.”
  • Emergency Boxes. PHARMACY must provide an “emergency” supply of medications as required by the facility and in compliance with state requirements.
  • Emergency Log Books. PHARMACY must provide a system for logging and charging for medications used from emergency/first dose stock.  Further the PHARMACY must maintain a comprehensive record of a resident’s medication order and drug administration.
  • Miscellaneous Reports, Forms, and Prescription Ordering Supplies. PHARMACY must provide reports, forms, and prescription ordering supplies necessary for the delivery of quality PHARMACY care in the LTC setting.  Such reports, forms, and prescription ordering supplies may include, but will not necessarily be limited to, pharmacy order forms, monthly management reports to assist the LTC facility in managing orders, medication administration records, treatment administration records, interim order forms for new prescription orders, and boxes/folders for order storage and reconciliation in the facility.
  • Home Infusion Access. PHARMACY shall ensure that the professional services and ancillary supplies necessary for the proper administration of home infusion drugs are in place prior to dispensing such Part D home infusion drugs.

6.1.3      Requirements Applicable to Home Infusion Pharmacies.

• PHARMACY must distribute written notice instructing Members to contact their Medicare Part D plan to obtain a coverage determination or request an exception if the Member disagrees with the coverage information provided by the PHARMACY. To satisfy this requirement, PHARMACY must use the form notice (Form No. CMS-10147 entitled “Medicare Prescription Drug Coverage And Your Rights”) and may not deviate from the content of this notice.  The notice must be provided to the Member as expeditiously as possible, but no later than seventy-two (72) hours from the PHARMACY’S receipt of the original transaction response indicating the Claim is not covered by Part D.  For Members who are brought service by the home infusion PHARMACY, the PHARMACY may also choose to deliver the notice in person with delivery of home infusion drugs or through an infusion nurse, as long as the next scheduled visit is within 72 hours of the receipt of the transaction code indicating the claim cannot be covered by Part D.  42 CFR § 423.562(a)(3).
• Participating Home Infusion providers may be required to attest to having complied with CMS Home Infusion standards and provide the attestation to SEVARX or its agents upon request. Home Infusion providers, at a minimum, hereby agree to provide (42 CFR § 423.120(a)(4)):
  • Delivery of home-infused drugs in a form that can be administered in a clinically appropriate fashion;
  • Infusible Part D drugs for both short-term acute care and long-term chronic care therapies;
  • Assurance that the professional services and ancillary services necessary for home infusion therapy are in place before dispensing Part D home infusion drugs; and
  • Delivery of home infusion drugs within 24 hours of discharge from an acute care setting, or later if so prescribed.

INDEMNITY AND LIMITATION OF LIABILITY

7.1          Indemnity by PHARMACY.  PHARMACY shall indemnify and hold harmless SEVARX, Plans, Plan Sponsors and their respective affiliates, shareholders, directors, officers, employees and agents from and against any and all claims, causes of action, obligations, liability, judgments, damages, losses, costs, fees, and expenses (including reasonable attorneys’ fees) that relate to or arise from PHARMACY’s or its officers, directors, employees, or agents (i)  breach of any term, representation, or warranty under this Agreement or (ii) PHARMACY’s act or omission of any its obligations under this Agreement. This provision shall survive termination of this Agreement.

7.2          Indemnity by SEVARX.  SEVARX shall indemnify and hold harmless PHARMACY and their respective affiliates, shareholders, directors, officers, employees and agents from and against any and all claims, causes of action, obligations, liability, judgments, damages, losses, costs, fees, and expenses (including reasonable attorneys’ fees) that relate to or arise from SEVARX’s or its officers, directors, employees, or agents breach of any term, representation, or warranty under this Agreement.

7.3          Limitation of Liability. NOTWITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT, SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES AS A RESULT OF THE PERFORMANCE OR ANY DEFAULT IN THE PERFORMANCE OF THEIR RESPECTIVE OBLIGATIONS UNDER THIS AGREEMENT.

7.4          Penalties. In the event SEVARX and/or Plan Sponsors incur penalties or other charges that result from PHARMACY’s actions, inactions, or other failure to comply with this Agreement or applicable laws or regulations, PHARMACY shall owe and pay such penalties or other charges immediately upon notice from SEVARX.

CONFIDENTIAL INFORMATION AND PRIVACY

8.1          Confidentiality.  PHARMACY, shall maintain the confidentiality of any confidential or proprietary information of SEVARX including, but not limited to, pricing, marketing, or product information; Formulary information; terms of this Agreement; and any other information designated as confidential or proprietary by SEVARX (collectively, “SEVARX Confidential Information”). Confidential Information shall not include information that: (a) is generally available to the public, (b) is now or later becomes available to the public through a source other than PHARMACY, or (c) is received from a third party which had the right to disclose the information.  SEVARX Confidential Information shall not be used by or for the benefit of PHARMACY directly or indirectly, except as may be necessary to carry its obligations pursuant to this Agreement. Immediately upon the expiration or other termination of this Agreement, PHARMACY shall return to SEVARX any and all copies of SEVARX Confidential Information.  The obligations of confidentiality in the Agreement shall survive any termination of this Agreement.  If PHARMACY is compelled by law or court order to disclose any SEVARX Confidential Information, PHARMACY will immediately notify SEVARX before making such disclosure. PHARMACY shall reasonably protect against destruction, loss, alteration, or unauthorized disclosure any Confidential Information of SEVARX or Plan Sponsor and any protected health information (PHI) in its or its personnel or subcontractor’s control.

8.2          Privacy and Security of Protected Health Information.  Parties shall ensure compliance with the requirements of the HIPAA Privacy Rule, the HIPAA Security Rule and the Health Information Technology for Economic and Clinical Health Act (“HITECH Act”), and any other applicable HIPAA Regulations in the performance of this Agreement.  Parties will ensure that any exchange, disclosure or release of PHI will be only in accordance with HIPAA, HITECH Act or federal and state laws or under a court order or subpoena and only as necessary to fulfill the obligations of this Agreement.

8.3          Marks and Logos.  PHARMACY shall allow SEVARX and Plan Sponsors to use PHARMACY’s name and information in directories and communications to Plans and Members.  Parties agree that any and all trademark, service marks, or other intellectual property will remain the sole and exclusive property of the respective Party and shall not be used by a Party in any manner not authorized by the other Party.

MISCELLANEOUS

9.1          Entire Agreement. This Agreement, including the Provider Manual and any Exhibits, Schedules or Addenda attached hereto, contains the entire agreement and understanding between the PHARMACY and SEVARX with respect to the provision of Covered Prescription Services to Members. This Agreement supersedes all prior oral or written negotiations, agreements or understandings between the parties with respect to the subject matter of this Agreement. In the event of conflict between the terms of this Agreement and the Provider Manual, the terms of the Provider Manual shall control.

9.2          Amendment. This Agreement, including Provider Manual, Schedules, Exhibits and Addenda to which this Agreement refers or which are attached hereto, may be amended (i) by a dated written amendment mutually signed by the PHARMACY and SEVARX or (ii) unilaterally by SEVARX upon thirty (30) days written notice to PHARMACY for any reason including in order to comply with any changes in applicable law and/or to address regulatory requirements or guidance, which shall become effective at the end of the thirty (30) day notice period or sooner if required by applicable law or regulation.

9.3          Waiver. The failure of either Party to enforce any one or more of the provisions hereof shall not be construed to be a waiver of the other Party’s responsibilities or obligations under such provision(s) or of the right of such Party to enforce each such provision.

9.4          Severability; Headings. In the event that any provision in this Agreement, shall be found by any government agency, court or arbitrator of competent jurisdiction to be invalid, illegal or unenforceable, such provision shall be construed and enforced as if it had been narrowly drawn so as not to be invalid, illegal or unenforceable, and the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby. The headings of paragraphs in this Agreement are for convenience and reference only and are not intended to and shall not define or limit the scope of the provisions to which they relate.

9.5          Dispute Resolution. The parties agree that they will attempt in good faith to resolve any dispute that may directly or indirectly arise out of or relate to this Agreement. If the parties are unable to resolve such dispute within thirty (30) calendar days after initial notice, each Party may, by notice to the other, have such dispute referred to a senior officer of each Party. Such officer shall attempt to resolve the dispute by good faith negotiation within thirty (30) calendar days after receipt of such notice. If the designated officers are not able to resolve such dispute within such thirty (30) calendar-day period, then the dispute shall be submitted, upon the motion of either Party, to arbitration to be conducted in accordance with the appropriate rules of the American Arbitration Association (“AAA”) in Indiana.  All such arbitration proceedings shall be administered by the AAA. The arbitration panel shall consist of three arbitrators. One arbitrator shall be appointed by each Party.  The third arbitrator, who shall act as chairman of the arbitration panel, shall be appointed by the other two arbitrators. If any arbitration is commenced against any Party hereto with respect to the subject matter contained in this Agreement, the Party prevailing in such arbitration shall be entitled, in addition to such other relief as may be granted in such proceeding, to a reasonable sum from the non-prevailing parties for attorney’s fees, expenses, and costs in such arbitration, which sum shall be determined in such arbitration. The parties agree that the decision of the arbitrators shall be final and binding as to each of them.

9.6          Notices. Unless otherwise provided for in the Agreement, written notice must be provided as set forth below. All notices called for hereunder shall be effective upon receipt. Notices required to be given pursuant to this Agreement related to breach, dispute, non-payment by SEVARX, and termination shall be in writing, postage prepaid, and shall be sent by certified mail, return receipt requested, or by an overnight delivery service which provides a written receipt evidencing delivery, to the address listed below. All other notices shall be given in the manner described above, or by facsimile, electronic mail (“email”), or US Mail, postage prepaid, to the other Party at the facsimile, email or mail address designated below.

 

SEVARX:                                                                        PHARMACY:

SEVARX Inc.                                                                  Name:                   ____________________________

10996 Four Seasons Place, Suite 100C                         Street Address:               ____________________________

Crown Point, IN 46307                                                  City, State, ZIP:                ____________________________

Attention: Provider Relations                                        Phone:                  ____________________________

Email: provider@seva-rx.com                                       Fax:                      ____________________________

Email:                   ____________________________

 

9.7          Independent Contractor. PHARMACY and SEVARX maintain no affiliation or relationship with each other except that of independent parties contracting solely to effectuate the purposes of this Agreement.  This Agreement does not create a joint venture, partnership, employment, or other relationship between the Parties.

9.8          Business Associate Relationship.  To the extent that SEVARX acts as a Business Associate of PHARMACY, and in accordance with HIPAA, SEVARX shall adhere to the applicable requirements established for Business Associates set forth in Exhibit B.

9.9          Third Party Beneficiaries.  This Agreement shall be binding on the Parties hereto and their respective successors and assigns and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns.  Nothing in this Agreement shall be construed to create any rights or obligations except among the Parties hereto; no person or entity shall be regarded as a third party beneficiary of this Agreement.

9.10       Governing Law. The laws of the State of Indiana shall govern this Agreement without giving effect to the conflicts of laws provision thereof. All disputes involving this Agreement shall take place in Indiana without exception.

9.11       Assignment. Neither Party shall have the right to assign this Agreement to a third party without the prior written consent of the other Party, which consent shall not be unreasonably withheld; provided, however, that SEVARX shall have the right to assign this Agreement without prior written notice to PHARMACY to any Affiliated entity, or in connection with a merger, reorganization, transfer, sale of assets, or a change of control or ownership. Any permitted assignee shall assume all obligations of its assignor under this Agreement.

9.12       Force Majeure. Noncompliance with the obligations hereunder for reasons of force majeure such as acts of God; war or civil commotion; destruction of production facilities and materials; fire, earthquake, hurricane or storm; labor disturbances; failure of public utilities or common carrier; or any other causes beyond the reasonable control of the parties, and if such parties have been unable to avoid or overcome the effects of the aforementioned reasons through the exercise of commercially reasonable efforts, the Party claiming an event of force majeure shall give prompt written notice to the other Party and shall not be deemed to be in breach of the terms of this Agreement .

9.13       Execution. This Agreement may be executed in two or more counterparts and, as so executed, shall constitute one and the same agreement binding on all parties. In addition, for purposes of executing this Agreement, a document (or signature page thereto) signed and transmitted by electronic format such as pdf or facsimile machine shall be treated as an original document. The signature of any Party thereon, for purposes hereof, shall be considered as an original signature, and the document transmitted shall be considered to have the same binding effect as an original signature on an original document.

EXHIBIT A

1. NATIONAL retail, Home Infusion, Long Term Care PHARMACY NETWORK
   1. PHARMACY shall receive the following Pharmacy Reimbursement Rates and Dispensing Fees for Clean Claims submitted on behalf of Members of all applicable Plans in the National Retail Pharmacy Network (“National Network”), unless a separate schedule or addendum applies.
   2. Subject to the Section 4.1 (Compensation) of the Agreement, the Pharmacy Reimbursement Rates for the National Network shall equal the lower of PHARMACY’s U&C Price, the submitted cost amount, or the following Pharmacy Reimbursement Rates:

PHARMACY REIMBURSEMENT RATES
All Days’ Supply	All applicable Prescription Drug Products	See Pharmacy Network Participation Agreement

 

2. In the event an exact NADAC match for an NDC is not found, the following logic will apply as applicable in the following order:

1. 1. NADAC+ fallback logic shall apply when no exact match for an NDC is found, but an NDC from the same manufacturer for the same product is found. In this case, the price for that NDC that is found (“NADAC+ Price”) shall be used and PHARMACY’s reimbursement shall be the NADAC+ Price plus a Dispensing Fee as listed in the Pharmacy Network Participation Agreement.
   2. Default Rates shall apply when no exact match for an NDC and no NDC from the same manufacturer for the same product is found. In this case, a flat AWP discount of AWP-19% plus a Dispensing Fee of $1.00 (“Brand Drug Default Rate”) shall be used for applicable Brand Drugs, and a flat AWP discount of AWP-88% plus a Dispensing Fee of $1.00 (“Generic Drug Default Rate”) shall be used for applicable Generic Drugs.
2. OTC Claims and Claims with an ingredient cost under $15.00 will process at the lower of U&C, submitted cost, NADAC+$1.00, or AWP-19%+1.00 for Brand Drugs and AWP-88%+$1.00 for Generic Drugs.
3. The reimbursement for vaccines and vaccine administration fees for the administration of Covered Vaccines to applicable Members shall be AWP-20% plus fifteen dollars ($15.00).

2. NARROW RETAIL PHARMACY NETWORK

1. PHARMACY shall receive the following Pharmacy Reimbursement Rates and Dispensing Fees for Clean Claims submitted on behalf of Members of all applicable Plans in the Narrow Retail Pharmacy Network (“Narrow Network”), unless a separate schedule or addendum applies. One (1) national retail pharmacy chain with more than eight thousand (8,000) locations is excluded from the Narrow Network.
2. Subject to the Section 4.1 (Compensation) of the Agreement, the Pharmacy Reimbursement Rates for the National Network shall equal the lower of PHARMACY’s U&C Price, the submitted cost amount, or the following Pharmacy Reimbursement Rates:

PHARMACY REIMBURSEMENT RATES
All Days’ Supply	All applicable Prescription Drug Products	see Pharmacy Network Participation Agreement

 

1. In the event an exact NADAC match for an NDC is not found, the following logic will apply as applicable in the following order:
   1. NADAC+ fallback logic shall apply when no exact match for an NDC is found, but an NDC from the same manufacturer for the same product is found. In this case, the price for that NDC that is found (“NADAC+ Price”) shall be used and PHARMACY’s reimbursement shall be the NADAC+ Price plus a Dispensing Fee as listed in the Pharmacy Network Participation Agreement.
   2. Default Rates shall apply when no exact match for an NDC and no NDC from the same manufacturer for the same product is found. In this case, a flat AWP discount of AWP-19% plus a Dispensing Fee of $1.00 (“Brand Drug Default Rate”) shall be used for applicable Brand Drugs, and a flat AWP discount of AWP-88% plus a Dispensing Fee of $1.00 (“Generic Drug Default Rate”) shall be used for applicable Generic Drugs.
2. OTC Claims and Claims with an ingredient cost under $15.00 will process at the lower of U&C, submitted cost, NADAC+$1.00, or AWP-19%+1.00 for Brand Drugs and AWP-88%+$1.00 for Generic Drugs.
3. The reimbursement for vaccines and vaccine administration fees for the administration of Covered Vaccines to applicable Members shall be AWP-20% plus fifteen dollars ($15.00).

Exhibit A to the Medicare Part D Addendum

1. Medicare Part d retail, Home Infusion, Long Term Care PHARMACY NETWORK
2. 1. PHARMACY shall receive the following Pharmacy Reimbursement Rates and Dispensing Fees for Clean Claims submitted on behalf of Members of all applicable Plans in the Medicare Part D Retail Pharmacy Network (“Med D Network”), unless a separate schedule or addendum applies.

1. 2. Subject to the Section 4.1 (Compensation) of the Agreement, the Pharmacy Reimbursement Rates for the Med D Network shall equal the lower of PHARMACY’s U&C Price, the submitted cost amount, or the following Pharmacy Reimbursement Rates:

PHARMACY REIMBURSEMENT RATES
All Days’ Supply	All Prescription Drug Products	See the Pharmacy Network Participation Agreement.

1. 1. In the event an exact NADAC match for an NDC is not found, the following logic will apply as applicable in the following order:
   2. NADAC+ fallback logic shall apply when no exact match for an NDC is found, but an NDC from the same manufacturer for the same product is found. In this case, the price for that NDC that is found (“NADAC+ Price”) shall be used and PHARMACY’s reimbursement shall be the NADAC+ Price plus a Dispensing Fee as listed in the Pharmacy Network Participation Agreement.
   3. Default Rates shall apply when no exact match for an NDC and no NDC from the same manufacturer for the same product is found. In this case, a flat AWP discount of AWP-19% plus a Dispensing Fee of $1.00 (“Brand Drug Default Rate”) shall be used for applicable Brand Drugs, and a flat AWP discount of AWP-88% plus a Dispensing Fee of $1.00 (“Generic Drug Default Rate”) shall be used for applicable Generic Drugs.
2. OTC Claims and Claims with an ingredient cost under $15.00 will process at the lower of U&C, submitted cost, NADAC+$1.00, or AWP-19%+1.00 for Brand Drugs and AWP-88%+$1.00 for Generic Drugs.

2. MEDICARE VACCINE REIMBURSEMENT. The reimbursement for vaccines and vaccine administration fees for the administration of Covered Medicare Vaccines to Members in the applicable Medicare Networks, as described above, shall be AWP-20% plus twenty dollars ($20.00).

Exhibit B – Business Associates Agreement

This Business Associate Agreement, dated as of the later date of signature of the Parties (this “Agreement”), supplements and is made a part of the SevaRx Pharmacy Network Participation Agreement (the “Participation Agreement”) by and between SevaRx, Inc. (“Business Associate”) and [PHARMACY] (“Covered Entity”).  Covered Entity and Business Associate may be referred to herein collectively as the “Parties” or individually as a “Party.”

WHEREAS, Covered Entity and Business Associate are entering into or are Parties to the Participation Agreement pursuant to which Business Associate provides certain services to Covered Entity.  In connection with such services, Business Associate creates, receives, maintains, or transmits Protected Health Information from or on behalf of Covered Entity, which information is subject to protection under the Federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), the Health Information Technology for Economic and Clinical Health Act (“HITECH”), and related regulations promulgated by the Secretary.

WHEREAS, in light of the foregoing and the HIPAA Rules, Business Associate and Covered Entity agree to be bound by the following terms and conditions.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

1. Definitions

1. General Definitions. The following terms used in this Agreement shall have the same meaning as those terms in the HIPAA Rules: Breach, Data Aggregation, Designated Record Set, Disclosure, Health Care Operations, Individual Minimum Necessary Notice of Privacy Practices, Protected Health Information, Required by Law, Security, Security Incident, Subcontractor, Unsecured Protected Health Information, and Use.
2. Specific Definitions.
   1. “Business Associate” shall generally have the same meaning as the term “business associate” at 45 CFR 160.104, and in reference to the Party to this Agreement, shall mean SevaRx, Inc.
   2. “Covered Entity” shall generally have the same meaning as the term “Covered Entity” at 45 CFR 160.103, and in reference to the Party to this Agreement, shall mean [PHARMACY].

• “HIPAA Rules” shall mean the Privacy, Security, Breach Notification, and Enforcement Rules at 45 CFR Part 160 and Part 164.

2. Business Associate Agreements.

Business Associate agrees to:

1. Not Use or Disclose Protected Health Information other than as permitted or required by this Agreement or as Required by Law;
2. Use appropriate safeguards, and comply with Subpart C of 45 CFR Part 164 with respect to electronic Protected Health Information, to prevent Use or Disclosure of Protected Health Information other than as provided for by this Agreement;
3. Report to Covered Entity any Use or Disclosure of Protected Health Information not provided for by this Agreement of which it becomes aware, including Breaches of Unsecured Protected Health Information as required by 45 CFR 164.410, and any Security Incident of which it becomes aware;
4. In accordance with 45 CFR 164.502(e)(1)(ii) and 164.308(b)(2), if applicable, ensure that any Subcontractors that create, receive maintain, or transmit Protected Health Information on behalf of Business Associate agree to the same restrictions, conditions, and requirements that apply to Business Associate with respect to such information;
5. Make available Protected Health Information in a Designated Record Set to Covered Entity as necessary to satisfy Covered Entity’s obligations under 45 CFR Part 164.524 including forwarding to Covered Entity a request to make available Protected Health Information in a designated record that Business Associate receives directly from the Individual within thirty (30) days of Business Associate’s receipt of the request.
6. Make any amendment(s) to Protected Health Information in a Designated Record Set as directed or agreed to by Covered Entity pursuant to 45 CFR Part 164.526, or take other measure as necessary to satisfy Covered Entity’s obligations under 45 CFR Part 164.526 including forwarding to Covered Entity a request for amendment that Business Associate receives directly from the Individual within thirty (30) days of Business Associate’s receipt of the request.
7. Maintain and make available the information required to provide an accounting of Disclosures to Covered Entity as necessary to satisfy Covered Entity’s obligations under 45 CFR Part 164.528 including forwarding to Covered Entity a request for accounting of Disclosures that Business Associate receives directly from the Individual within thirty (30) days of Business Associate’s receipt of the request;
8. To the extent that Business Associate is to carry out one or more of Covered Entity’s obligations under Subpart E of CFR Part 154 under this Agreement, comply with the requirements of Subpart E that apply to Covered Entity in the performance of such obligation(s); and
9. Make its internal practices, books, and records available to the Secretary for purposes of determining compliance with HIPAA Rules

3. Permitted Use and Disclosures by Business Associate.

1. Business Associate may only Use or Disclose Protected Health Information as necessary to perform the services set forth in this Agreement or the Participation Agreement and is authorized to Use Protected Health Information to de-identify information in accordance with 45 CFR 164.514(a)-(c) and Use the de-identified information as permitted by this Agreement, the Participation Agreement, or Law.
2. Business Associate may Use or Disclose Protected Health Information as Required by Law.
3. Business Associate agrees to make Uses and Disclosures and requests for Protected Health Information only as Minimally Necessary for the purpose of the Use, Disclosure, or request, as the case may be.
4. Business Associate may not Use or Disclose Protected Health Information in a manner that would violate Subpart E of 45 CFR Part 164 if done by Covered Entity except for the specific Uses and Disclosures set forth below.
5. Business Associate may Use Protected Health Information for the proper management and administration of Business Associate or to carry out the legal responsibilities of Business Associate.
6. Business Associate may Disclose Protected Health Information for the proper management and administration of Business Associate or to carry out the legal responsibilities of Business Associate, provided the Disclosures are Required by Law, or Business Associate obtains reasonable assurances from the person to whom the information is disclosed that the information will remain confidential and Used or further Disclosed only as Required by Law or for the purposes for which it was disclosed to the person, and the person notifies Business Associate of any instances which it is aware in which the confidentiality of the information has been breached.
7. Business Associate may provide Data Aggregation services relating to Health Care Operations of Covered Entity.

4. Provisions for Covered Entity to Inform Business Associate of Privacy Practices and Restrictions.

1. Covered Entity shall notify Business Associate of any limitation(s) in the Notice of Privacy Practices of Covered Entity under 45 CFR 164.520, to the extent that such limitation(s) may affect Business Associate’s Use or Disclosure of Protected Health Information.
2. Covered Entity shall notify Business Associate of any changes in, or revocation of, the permission by an Individual to Use or Disclose his or her Protected Health Information, to the extent that such changes may affect Business Associate’s Use or Disclosure of Protected Health Information.
3. Covered Entity shall notify Business Associate of any restriction on the Use or Disclosure of Protected Health Information that Covered Entity has agreed to or is required to abide by under 45 CFR 164.522, to the extent that such restriction may affect Business Associate’s Use or Disclosure of Protected Health Information.

5. Permissible Requests by Covered Entity.

Covered Entity shall not request Business Associate to Use or Disclose Protected Health Information in any manner that would not be permissible under Subpart E of 45 CFR Part 164 if done by Covered Entity, except Business Associate may Use or Disclose Protected Health Information for Data Aggregation or management and administration and legal responsibilities of Business Associate in accordance with this Agreement and the Participation Agreement.

6. Term and Termination.

1. Term. The Term of this Agreement shall continue through the period that Business Associate provides services to Covered Entity.
2. Termination for Cause. A Party may terminate this Agreement by giving notice to the other upon the commission by the other Party of a Breach under the HIPAA Rules.
3. Obligations of Business Associate Upon Termination. Upon termination of this Agreement for any reason, Business Associate, with respect to Protected Health Information received from Covered Entity, or created, maintained, or received by Business Associate on behalf of Covered Entity, shall:
   1. Retain only that Protected Health Information which is necessary for Business Associate to continue its proper management and administration or to carry out its legal responsibilities;
   2. Return to Covered Entity, or if agreed to by Covered Entity, destroy, the remaining Protected Health Information that Business Associate still maintains in any form;
   3. Continue to use appropriate safeguards and comply with Subpart C of 45 CFR Part 164 with respect to electronic Protected Health Information to prevent Use or Disclosure of Protected Health Information, other than as provided for in this Section, for as long as Business Associate retains the Protected Health Information.
   4. Not Use or Disclose the Protected Health Information retained by Business Associate other than for the purposes for which such Protected Health Information was retained and subject to the same conditions set out at Sections III(e) and (f) above which applied prior to termination;
   5. Return to Covered Entity, or if agreed to by Covered Entity, destroy, the Protected Health Information retained by Business Associate for its proper management and administration or to carry out its legal responsibilities; and
   6. Obtain or ensure the destruction of Protected Health Information created, received, or maintained by Subcontractors.

4. Survival. The obligations of Business Associate under this Section VI shall survive the termination of this Agreement.

7. Miscellaneous

1. Regulatory References. A reference in this Agreement to a section in the HIPAA Rules means the section as in effect or amended.
2. Amendment. The Parties agree to take such action as is necessary to amend this Agreement from time to time as is necessary for compliance with the requirements of the HIPAA Rules and any other applicable Law.
3. Interpretation. Any ambiguity in this Agreement shall be interpreted to permit compliance with the HIPAA Rules.
4. Limitation of Liability. BUSINESS ASSOCIATE’S AGGREGATE LIABILITY FOR ANY DAMAGES ARISING FROM OR IN CONNECTION WITH THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT PAID BY COVERED ENTITY TO BUSINESS ASSOCIATE (EXCLUDING POSTAGE, IF ANY) DURING THE 12 MONTH PERIOD BEFORE THE CLAIM AROSE, REGARDLESS OF THE FORM OF ACTION.