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PROSPECTUS SUPPLEMENT NO. 33 Filed pursuant to Rule 424(b)(3)
To the Prospectus dated January 24, 1997, Registration No.: 333-01926
As Supplemented to Date
340 Shares
of
Class B Common Stock of Doctors Health System, Inc.
This Prospectus Supplement No. 33 relates to the issuance by Doctors
Health System, Inc., a Maryland corporation ("Doctors Health") of 340 shares
of its Class B Common Stock, par value $.01 per share (the "Class B Common
Stock") pursuant to the Primary Care Participation Agreement (the
"Participation Agreement") to be entered into between Dr. Rahul E. Gilotra
("Physician"), and Doctors Health. This Prospectus Supplement should be read
in conjunction with the Prospectus dated January 24, 1997, the Prospectus
Supplement No. 1 dated March 14, 1997 which contains the Company's Quarterly
Report on Form 10-Q for the period ended December 31, 1996, the Prospectus
Supplement No. 14 dated May 16, 1997 which contains the Company's Quarterly
Report on Form 10-Q for the period ended March 31, 1997, and the Prospectus
Supplement No. 25 dated July 21, 1997 which contains a report of the
financial transaction of July 15, 1997.
Doctors Health's principal executive office is located at 10451 Mill Run
Circle, Tenth Floor, Owings Mills, Maryland 21117, telephone number (410)
654-5800.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT DOES NOT CONSTITUTE AN OFFER OF
ANY PERSON TO EXCHANGE OR SELL, OR A SOLICITATION FROM ANY PERSON OF AN OFFER
TO EXCHANGE OR PURCHASE, THE SECURITIES OFFERED BY THIS PROSPECTUS
SUPPLEMENT, OR THE SOLICITATION OF A PROXY FROM ANY PERSON, IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT NOR ANY DISTRIBUTION OF
THE SECURITIES TO WHICH THIS PROSPECTUS SUPPLEMENT RELATES SHALL UNDER ANY
CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED THEREIN
IS CORRECT AT ANY TIME SUBSEQUENT TO THE DATE HEREOF.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
See "Risk Factors" referred to on page S-2 hereof for certain information
that should be considered in connection with an investment in securities of
Doctors Health.
The date of this Prospectus Supplement is September 16, 1997.
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RISK FACTORS
Financial Performance of Doctors Health
Doctors Health has a limited operating history and for the fiscal year
ended June 30, 1996 and the six months ended December 31, 1996, recorded a
net loss of approximately $6.6 million and $6.7 million, respectively.
Doctors Health is likely to record a net loss for the fiscal year ending June
30, 1997. There can be no assurance that after the Closing Date Doctors
Health will earn operating profits.
Risk Factors set forth in the Prospectus dated January 24, 1997
The Risk Factors set forth in the Prospectus are incorporated herein by
reference and should be read carefully by investors.
PROPOSED PRIMARY CARE PARTICIPATION AGREEMENT AMONG DOCTORS HEALTH AND DR.
RAHUL E. GILOTRA
The following description of the transactions contemplated by the
Participation Agreement does not purport to be complete and is qualified in
its entirety by reference to the Participation Agreement, a copy of which is
attached to this Prospectus Supplement as Annex A and is incorporated herein.
Physician is urged to read the Participation Agreement in its entirety.
General
Pursuant to the Participation Agreement, (i) Physician agrees to
participate in the managed care agreements that Doctors Health enters into
with Payors who have contracted with Doctors Health with respect to HMO
managed care products ("DHS HMO Plans"), (ii) Physician agrees to provide
eligible persons who elect to enroll in DHS HMO Plans (each, a "DHS HMO
Member") with those primary care services customarily provided by primary
care physicians, as may be required by the DHS HMO Plans, (iii) Physician
will be paid cash in the amount of $11,900.00 upon execution of the
Participation Agreement and satisfactory completion of credentialling of
Physician by DHS, and (iv) DHS will issue to the Physician 340 shares of its
Class B Common Stock.
Access to Doctors Health Services; Credentialling
Pursuant to the Participation Agreement, Doctors Health agrees to provide
to Physician, once Physician has 100 DHS Members in his medical practice and
at no cost to Physician, access to the managed care component of Doctors
Health's information system, which offers patient registration, referral
tracking and management and data management capabilities. Doctors Health
will also undertake to credential Physician, at no cost to Physician.
Pursuant to the Participation Agreement, Physician agrees to cooperate with
the Doctors Health credentialling and review process at no cost to Physician.
Exclusive IPA Arrangement
Pursuant to the Participation Agreement, Physician agrees to participate
in the managed care agreements that Doctors Health enters into with DHS HMO
Plans. Physician is required pursuant to the Participation Agreement to
cooperate with Doctors Health in accepting DHS HMO Members under the DHS HMO
Plans, and agrees not to participate or contract with any other HMO or other
payor offering managed care or other risk-type plans directly or indirectly;
provided, however, that if Doctors Health chooses not to pursue a contract
with an identified HMO or is unable to negotiate such a contract within a
commercially reasonable time period, Physician shall be free to pursue a
contract with the identified HMO.
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Capitation Rates; Bonus Pool
The Participation Agreement provides that DHS will determine the
commercial and Medicare primary care base capitation rates using their good
faith best efforts to reflect the prevailing market rate for the county and
city in which Physician provides covered services (the "Primary Care Base
Capitation Rates"). The Primary Care Base Capitation Rates may be adjusted
for age and sex of the DHS HMO members. The Primary Care Base Capitation
Rate shall be adjusted by an amount up to ten percent each based upon (i) a
formula for Commercial HMO Members taking into account certain factors as
capitation panel size, DHS membership growth, scheduled office hours and
service and medical care coordination considerations; and (ii) a formula for
Medicare HMO Members taking into account the number of HMO Members served by
Physician's medical practice. The Commercial and Medicare formulas are set
forth on Exhibit D-21 of the Participation Agreement. All payments of the
Primary Care Base Capitation Rates will be made by Doctors Health directly to
Physician, by the fifth day of the month for the prior month's enrollment.
Physician agrees pursuant to the Participation Agreement not to seek or
collect or accept any reimbursement from DHS HMO Members or the DHS HMO Plans
for any covered services provided to DHS HMO Members, except for copayments
and coinsurance.
The Participation Agreement also provides that Physician may participate
in a bonus pool established by Doctors Health's affiliated physicians. The
amount of bonus awards are determined according to Doctors Health's primary
care bonus system, rewarding high clinical quality, appropriate utilization,
patient satisfaction and retention and the extent of cooperation with other
participating physicians, and Doctors Health. Based upon these factors,
Physician may receive a bonus based upon the surplus generated in Physician's
panel of DHS HMO Members, after managed care expenses, up to a maximum of 25%
of all Primary Care Base Capitation payments received by Physician that year
or the limits provided by applicable health care regulations. Bonus awards
for a calendar year, if any, will be paid by April of the following year.
There can be no assurance that a bonus will be paid in any given year or, if
paid, as to the amount of any bonus. A copy of Doctors Health's bonus system
for primary care physicians is on file at the offices of Doctors Health and
will be made available at the request of Physician.
Obligations of Physician
Pursuant to the Participation Agreement, Physician agrees to abide by and
comply with the relevant provisions of the agreements between Doctors Health
and the DHS HMO Plans. Doctors Health will provide Physician with all
relevant provisions that may apply to such Physician. In such connection,
the Participation Agreement provides that Physician shall work cooperatively
and in good faith with Doctors Health and the other Doctors Health affiliated
physicians providing services to the DHS HMO members. Physicians are
required to (i) prepare and maintain customary medical records for services
provided to DHS HMO Members and provide Doctors Health with access to such
records without charge, (ii) comply with and accept the payment conditions of
the Participation Agreement, (iii) comply with managed care medical standards
adopted by Doctors Health affiliated physicians as part of the arrangements
with the DHS HMO Plans, and (iv) cooperate with Doctors Health's efforts to
contact eligible Medicare and adult medicine patients in Physician's
practice, including providing mailing lists and the use of Physician's name
in correspondence, and (v) sign and submit in a timely manner authorizations,
consents, encounter data and other forms adopted by Doctors Health.
Pursuant to the Participation Agreement, Physician will own and operate
all aspects of his medical practice and will remain responsible for all
operations of the medical practice, including all patient treatment decisions
and employee, office, lease and financial affairs. Doctors Health is not
engaged in the practice of medicine and will not interfere in any patient
treatment decisions. The Participation Agreement provides an agreement by
Physician not to differentiate or discriminate in the treatment of patients
as to the quality of services delivered because of race, sex, age, religion,
place of residence, health status or source of payment. Physician is
required to make arrangements for 24 hour seven day per week
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coverage to DHS HMO Members through other primary care physicians who
participate in the Doctors Health provider network.
Doctors Health will provide to Physician a list of other physicians and
other health care providers who provide medical services in the Doctors
Health provider network. Other than in cases of a bona fide emergency, the
Participation Agreement requires Physician to utilize the Doctors Health
provider network when arranging for additional medical services required by
DHS HMO Members. Doctors Health may use Physician's name, specialty,
telephone number and business location in marketing, descriptive and other
information relating to the DHS HMO Plans. The Participation Agreement
provides that Physician may be precluded from participating in a DHS HMO
product by one of the DHS HMO Plans. In such event, Doctors Health will
notify Physician, in writing, within 30 days of learning of such an action,
and will assist Physician, if requested, in seeking to overturn such an
action.
Existing Primary Care Capitation Contracts
The Participation Agreement provides that if Physician is a party,
directly or indirectly, to any primary care capitation contract, Physician
must notify Doctors Health of such contract and must use his commercially
reasonable best efforts to assist Doctors Health in replacing such contract
with a DHS HMO Plan, provided that the payment terms of such DHS HMO Plan are
at or above the payment terms of such existing contract.
Quality Assurance/Utilization Review Programs
Pursuant to the Participation Agreement, Physician will participate in
all utilization review, quality assurance and credentialling programs
operated by Doctors Health to assure or improve the quality and effective
utilization of health care services to the DHS HMO Members. In such
connection, Physician agrees (i) not to hold Doctors Health or any other
participants in such quality assurance/utilization review programs
responsible for reasonable recommendations made or actions taken in good
faith with respect to Physician, and (ii) to participate in all programs
developed by Doctors Health that are designed to resolve DHS HMO Member
grievances.
DHS Protocols
Pursuant to the Participation Agreement, Physician agrees to follow the
protocols and practice procedures which have been developed by Doctors
Health's affiliated physicians which are applicable to physician participants
in the Doctors Health provider network. In such connection, if Physician
should ever deem any aspect of such protocols to be medically inappropriate
or otherwise inappropriate for utilization, Physician may notify Doctors
Health in writing with sufficient specificity to enable Doctors Health to
respond to Physician's concerns.
Term; Termination
The Participation Agreement will terminate five years from its effective
date unless earlier terminated pursuant to its terms.
Doctors Health may terminate the Participation Agreement by notice in
writing to Physician (i) if Physician materially breaches the Participation
Agreement and such breach continues for 30 days after written notice is given
to Physician by Doctors Health specifying the nature of such breach, or (ii)
for "good cause." The Participation Agreement defines "good cause" to mean
the occurrence of any one of the following: (a) Physician's membership in any
professional organization is terminated for cause related to professional
conduct, or Physician resigns from any professional organizations under the
threat of disciplinary action for professional conduct, (b) Physician is
indicted for a charge of committing a felony or
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any misdemeanor involving moral turpitude, (c) Physician fails to comply with
rules, regulations and policies imposed with regard to Medicare programs or
fails to preserve his or her eligibility to participate in Medicare programs,
(d) physician fails to comply with any material Doctors Health protocols, (e)
Physician takes any action which puts a DHS HMO Member's health at risk, or
(f) Physician loses his or her license or certificate to practice medicine.
Physician may terminate the Participation Agreement upon 90 days written
notice to Doctors Health if Doctors Health fails to perform its obligations
to Physician to pay any amounts required to be paid by Doctors Health to
Physician.
Maintenance of Liability Insurance
The Participation Agreement provides that Physician must maintain, at his
expense, general and professional liability insurance coverage of not less
than $1 million per claim and $3 million per year. Physician is required
pursuant to the Participation Agreement to provide Doctors Health with copies
of such policies or other evidence of compliance with such insurance
requirements and is required to notify Doctors Health of any changes or
cancellations to any such policy. In the event of a cancellation of a
policy, Physician is required to purchase an extension of coverage
endorsement within 10 days of written notice of discontinuance and must
provide Doctors Health with a copy of such endorsement. Pursuant to the
Participation Agreement, Physician must also notify Doctors Health promptly
when any patient of Physician files a claim or any notice of intent to
commence legal action alleging professional negligence against Physician, or
of the settlement of any such claim, or if a judgment is entered against
Physician in any such claim.
RESALE OF CLASS B COMMON STOCK
The shares of Class B Common Stock offered by this Prospectus Supplement
have been registered under the Securities Act of 1933, as amended. The
shares will be subject to the Stockholders Agreement attached hereto as Annex
B and therefore, will not be freely transferable. In addition, there is no
public market for the Class B Common Stock.
LEGAL MATTERS
The validity of the Class B Common Stock offered hereby have been passed
upon for the Company by Venable, Baetjer and Howard, LLP, Baltimore,
Maryland.-
ANNEXES
Annex A - Participation Agreement between Doctors Health System, Inc. and
Rahul E. Gilotra
Annex B - Shareholders Letter Agreement delivered to Physician as
Prospectus Supplement No. 26
ANNEX A
PRIMARY CARE PARTICIPATION AGREEMENT
1. This Participation Agreement is entered into on __________________, 1997
(the "Effective Date") by DOCTORS HEALTH, INC. ("DH") and the Physician
whose name appears below.
2. DH agrees to arrange for the provision of various management,
administrative and support services in connection with managed care
contracting, including contracting, marketing, care management and
information systems support. (For a description of these services see
Exhibit A-2 attached.)
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3. Physician or the Physician's group practice entity, if the Physician
participates as a partner or employee of a group practice entity, will be
paid a Signing Bonus in part cash and part shares of DH Class B Common
Stock, as set forth on Exhibit B-3 attached hereto and made a part
hereof. This payment will be made upon execution of this Agreement,
satisfactory credentialing of Physician by DH and provision of
Physicians' financial statements and Medicare patient list and is subject
to modification to the extent the information received by DH differs from
the information provided on Exhibit B-3. This payment is made based upon
Physician's assurance to DH that he/she is an actively practicing primary
care physician who intends to enter into a cooperative relationship with
other DH affiliated physicians to manage care to DH HMO Members.
4. This Agreement will expire five (5) years from the Effective Date of this
Agreement (the "Term"), unless earlier terminated pursuant to the terms
hereof.
5. DH agrees to provide Physician, once Physician has at least 100 DH
Members, at no cost to the Physician, access to the DH Information System
managed care components, offering Enrollment, Eligibility, Referral
Management and Data Management capabilities.
6. Physician agrees to provide to eligible persons who elect to enroll in an
HMO managed care product offered by any Payor who has contracted with DH
(the "DH HMO Plans") those primary care services customarily provided by
primary care physicians to eligible patients, as may be required by the
DH HMO Plans. These patients are referred to in this Agreement as the
"DH HMO Members".
7. DH will credential Physician. Physician agrees to cooperate with the DH
credentialing and review process, all at no cost to Physician.
8. Physician agrees to participate in the managed care agreements that DH
enters into with DH HMO Plans. Physician agrees to cooperate with DH in
accepting DH HMO Members under the DH HMO Plans, and agrees not to
participate or contract with any other HMO or other payor offering
managed care or other risk type plans directly or through another similar
entity or other IPA. However, if DH chooses not to pursue a contract
with an identified HMO or is unable to negotiate such a contract within a
commercially reasonable period, Physician shall be free to pursue a
contract with the identified HMO.
9. If Physician, as of the Effective Date, is a party (directly or
indirectly through another similar entity or IPA) to any primary care
capitation contract (each an "Existing Primary Care Capitation
Contract"), Physician agrees to notify DH of such Existing Primary Care
Capitation Contract. Physician agrees to use his or her commercially
reasonable best efforts to assist DH in replacing such Existing Primary
Care Capitation Contract with a DH HMO Plan, provided the payment terms
to the Physician under the DH HMO Plan are at or above the payment terms
of the Existing Primary Care Capitation Contract. Until DH is able to
replace the Existing Primary Care Capitation Contract with a DH HMO Plan,
the Physician shall be free to renew the Existing Primary Care Capitation
Contract for additional one year terms.
10. Physician agrees to abide by and comply with the relevant provisions of
the agreements between DH and the DH HMO Plans. DH provide all relevant
provisions that may apply to Physician.
11. Physician agrees to work cooperatively and in good faith with DH and the
other DH affiliated physicians providing services to the DH HMO Members.
To this end, Physician will use all reasonable efforts to:
- Prepare and maintain customary medical records for services
provided to DH HMO Members and provide the IPA with access to
such records without charge. DH agrees that all patient
records will be treated as confidential and will comply with
laws and regulations related to confidentiality and all ethical
standards for physicians regarding the confidentiality of
patient records.
- Comply with and accept payment conditions of this Agreement.
- Comply with managed care medical standards adopted by DH
affiliated physicians as part of arrangements with the DH HMO
Plans.
- Cooperate with DH'S efforts to contact eligible Medicare and
adult medicine patients in Physician's practice, including
providing mailing lists and use of Physician's name in
correspondence.
- Sign and submit in a timely manner authorizations, consents,
encounter data and other forms adopted by DH.
- Comply with DH policies and guidelines which DH provides to
physician.
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12. Physician will participate in all utilization review, quality assurance
and credentialing programs operated by DH and the IPA to assure or
improve the quality and effective utilization of health care services to
the IPA HMO Members ("QA/UR Programs"). Physician agrees not to hold DH
and other participants in the QA/UR Programs responsible for any
reasonable recommendations made or actions taken in good faith with
respect to Physician. Physician will participate in all programs
developed by DH that are designed to resolve DH HMO Member grievances.
13. Physician agrees not to differentiate or discriminate in the treatment of
patients as to the quality of services delivered to DH HMO Members
because of race, sex, age, religion, place of residence, health status or
source of payment, and to observe, protect and promote the rights of DH
HMO Members as patients.
14. Physician will in good faith make arrangements, with the support of
Physician's assigned DH representative, for twenty-four hours, seven days
a week coverage to DH HMO Members through other primary care physicians
who participate in the DH provider network to the extent the DH provider
network is adequate to provide such coverage in Physician's service area.
15. Physician agrees to respond within seven (7) days of receipt to any
written inquiry from DH regarding services provided to DH HMO Members or
any other matters relating to this Agreement, subject to all laws
regarding the confidentiality of medical records,.
16. DH will provide to Physician a list of other physicians and other health
care providers who provide medical services in the DH provider network.
Other than in cases of a bona-fide medical emergency or where DH and the
Physician have agreed the DH provider network is insufficient, Physician
agrees to utilize the DH provider network when arranging for additional
medical services required by DH HMO Members.
17. DH'S affiliated physicians have developed protocols and practice procedures
applicable to fellow physician participants in the DH provider network (the
"DH Protocols"). Physician agrees to follow the DH Protocols when treating
DH HMO Members. If Physician should ever deem any aspect of the DH
Protocols to be medically inappropriate or otherwise inappropriate for
utilization by Physician, Physician may notify DH in writing, with
sufficient specificity to enable DH to respond to Physician's concerns.
18. Physician will own and operate all aspects of his or her medical practice
and will remain responsible for all operations of the medical practice,
including all patient treatment decisions and employee, office, lease and
financial affairs. DH is not engaged in the practice of medicine and
will not interfere in any patient treatment decisions.
19. DH may use Physician's name, specialty, telephone number(s), and business
location(s) in marketing, descriptive, and other information relating to
the DH HMO Plans, and will include Physician as a member of the DH
provider network during this Agreement. Physician may nonetheless be
precluded from participating in a DH HMO Product by one of the DH HMO
Plans. In such an event, DH will notify Physician, in writing, within 30
days of learning of such an action, and will assist Physician, if
requested, in seeking to overturn such an action.
20. During the calendar year 1997, DH will pay to Physician, and Physician
agrees to accept from DH as compensation for all covered services
provided by Physician to DH HMO Members the Primary Care Base Capitation
Rates as shall be set forth on Exhibit C-20 to be attached hereto and
made a part hereof. For calendar year 1998 and beyond, DH shall
establish in cooperation with DH participating primary care physicians a
Primary Care Base Capitation Rate that shall reflect at least the
prevailing market rate for the county or city in which the Physician
provides covered services.
21. The Primary Care Base Capitation Rates may be adjusted for age and sex of
the DH HMO Members. The Primary Care Base Capitation Rates will be
increased by an amount up to ten percent (10%) (the "Capitation Rate
Modifier"), according to a Medicare and Commercial formula established by
DH as set forth on Exhibit D-21 attached hereto and made a part hereof.
22. Physician will, in addition to the Primary Care Capitation payment, be
paid on a fee for service basis for certain identified services which are
not considered covered services according to the DH fee schedule that
will be approximately equal to cost and less than alternative specialist
expenditures.
23. In order to provide economic incentives for Physicians to provide the
best possible health care to DH HMO Members while fostering efficiencies
in utilization and quality assurance, DH's affiliated physicians have
established, and Physician will participate in, a bonus pool. The amount
of bonus awards are determined according to DH'S primary care bonus point
system, rewarding high clinical quality, appropriate utilization, patient
satisfaction and retention and the extent of cooperation with
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other participating physicians DH. Based upon this system, DH will fund
a primary care physician bonus pool which will be credited with 25% of
the managed care surplus remaining after deduction of the actual costs
associated with the provision of managed care services. The Physician
will receive a bonus based upon the net surplus in the bonus pool that is
generated in Physician's panel of DH HMO Members up to the limits
permitted by applicable health care regulations. The Primary Care
Capitation Rates for any year are guaranteed and never charged or offset
for any losses. Losses are the sole responsibility of DH. Bonus Awards
for calendar year 1996 will be paid by DH in April of 1997. Awards for
calendar year 1997 will be made in April of 1998 etc. (The DH "Bonus
Point System" for Primary Care Physicians is set forth on Exhibit F-23
attached hereto and made a part hereof.)
24. All Payments of the Primary Care Capitation Rate will be made by DH
directly to Physician, by the fifth business day of each month for the
prior month's enrollment. The Capitation Rate Modifier will be
calculated at the beginning of each quarter and used to determine the
following quarters' Primary Care Capitation Rate.
25. Physician understands that DH will be paid by the DH HMO Plans for all
services provided by Physician to DH HMO Members.
26. Physician agrees not to bill or collect any reimbursement from DH HMO
Members or the DH HMO Plans unless the service provided was not a covered
service under the DH HMO Plan and the DH HMO Member was given prior
written notice that the services would not be covered. However,
Physician may charge, bill, collect and keep from DH HMO Members any
copayments or coinsurance. Physician agrees that, whether or not there
is any unresolved dispute for payment, under no circumstances, including
but not limited to nonpayment by DH or DH insolvency, will Physician make
any claims, other than for copayments or coinsurance, against any DH HMO
Member for covered services.
27. Physician will maintain, at his or her expense, general and professional
liability insurance coverage of not less than $1,000,000 per claim and
$3,000,000 per year. Physician will provide DH with copies of the
policies or other evidence of compliance with the insurance requirements.
Physician will notify DH when any patient of Physician files a claim or
any notice of intent to commence legal action alleging professional
negligence against Physician or of the settlement of any such claim by
Physician or if a judgment is rendered against Physician in any such
legal action. Physician will promptly notify DH in writing of any
changes in or cancellations of any policy of insurance maintained by
Physician. If such policy is written on a claims made basis and such
coverage is discontinued, Physician will purchase an "Extension of
Coverage Endorsement" within ten (10) days of written notice of
discontinuance and shall provide DH with a copy of this endorsement.
28. This Agreement may be terminated by Physician upon 90 days prior written
notice to DH if DH fails to perform its obligations to Physician or to
pay any amounts required to be paid by DH to Physician.
29. DH may terminate this Agreement by notice in writing to Physician for
good cause, or if Physician materially breaches this Agreement and such
breach continues for a period of thirty (30) days after written notice is
given to Physician by DH specifying the nature of the breach. Good cause
means:
- Physician's membership in any professional organization is
terminated for cause related to professional conduct, or Physician
resigns from any professional organizations under the threat of
disciplinary action for professional conduct.
- Physician is indicted upon a charge of committing a felony or any
misdemeanor involving moral turpitude.
- Physician fails to comply with rules, regulations and policies
imposed with regard to the Medicare programs or to preserve his or
her eligibility to participate in the Medicare programs.
- Physician fails to comply with any material DH Protocols.
- Physician takes any action which puts a DH HMO Members' health at
risk.
- Physician loses his/her license or certificate to practice medicine.
30. To the extent required to enable DH and the IPA to comply with Section
952 of the Medicare and Medicaid Amendments of 1980, or regulations
promulgated pursuant thereto, Physician shall until the expiration of
four (4) years after the furnishing of services under this Agreement,
make available, upon written request, to the Secretary of Health and
Human Services or the Comptroller General of the United States, or to any
of their duly authorized representatives, this Agreement and such of
Physician's books, documents and records as are necessary to certify the
nature and extent of costs under this Agreement.
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PRINTED NAME OF PHYSICIAN PHYSICIAN
_____________________________ By: ____________________ (SEAL)
Please Attach Business Card , M.D.
DOCTORS HEALTH, INC.
By:______________________(SEAL)
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EXHIBIT A-2
Schedule of Services
1. Care Management includes:
a. Credentialing and Provider File Maintenance. In compliance with
NCQA standards, the credentialing process gathers information on our
member providers, performs primary source verification, provides
automatic recredentialing activities and alerts providers when items
need to be renewed and/or reevaluated.
b. Referral Management. The DH Referral Management Program provides
for the maintenance of referral directories; authorization of DH
referrals to network providers; clinical review of referrals for
appropriateness, according to DH physician approved criteria; and
tracking and reporting of referral patterns to identify outliers and
encourage recommendations for change.
c. Utilization Management. The DH Utilization Management Program
reviews and tracks the utilization of healthcare services,
particularly inpatient stays, to facilitate appropriate hospital
admissions; provides recommendations for alternate site care and
assists with the coordination of these services; provides clinical
review of procedural necessity; and works with the physician to
identify practice pattern trends.
d. Case Management. The DH Case Management Program offers to
physicians the skills of registered nurses and licensed clinical
social workers in order to assist in the coordination of the care
and services required by patients with catastrophic and/or chronic
illnesses or injuries. The case manager works in conjunction with
the physician, patient and family to identify healthcare needs,
develop a plan of care, establish realistic treatment goals,
coordinate and monitor necessary resources, and evaluate treatment
progress.
2. Data Management. The DH Data Management service coordinates the receipt
and maintenance of payor eligibility and benefit plan information. It
also allows for the coordination and integration of a variety of data
components to yield meaningful reports which will reflect the overall
performance of a provider network, i.e., utilization, costs and quality.
3. Patient Services. DH provides all Participating Physicians, access to
nurse triage and patient advocacy services. Through these services,
specially trained nurses are available by phone to answer questions
regarding access to services, treatment alternatives and self care
options.
4. Third Party Administration. The DH Third Party Administration services
provide for the appropriate adjudication of claims, coordination of
benefits, subrogation services and integration with the reinsurance
carrier.
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EXHIBIT B-3
SIGNING BONUS
Physician's Signing Bonus is based upon the following representations made by
Physician:
1. Physician's gross primary care collections for the 1996 calendar year
were $170,000.00.
2. The number of Physician's active(1)Medicare patients is 350.
Based upon and subject to the accuracy of the information provided herein,
Physician's Signing Bonus shall be an amount equal to :
1. Cash in the amount of $ 11,900.00.
2. 340 shares of Class B Common Stock of Doctors Health.
A Prospectus describing Doctors Health and its affiliates is enclosed. Please
direct your attention to pages 8 to 16 of the Prospectus which describes the
risk factors which you should consider in evaluating an investment in the
securities offered under the Prospectus and in this Agreement. We will provide
updated information about this company in the form of a Prospectus Supplement.
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(1) Patients who have made at least one office visit to Physician during the
last two years.
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