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PROSPECTUS SUPPLEMENT NO. 16/A Filed pursuant to Rule 424(b)(3)
To the Prospectus dated January 24, 1997, Registration No.: 333-01926
As Supplemented to Date
442 Shares
of
Class B Common Stock of Doctors Health, Inc.
This Prospectus Supplement No. 16/A relates to the issuance by Doctors
Health, Inc., a Maryland corporation ("Doctors Health") of 442 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. Donald E. Bartlett, Jr.
("Physician"), and Doctors Health. This Prospectus Supplement should be read
in conjunction with the Prospectus dated January 24, 1997, the Prospectus
Supplement No. 26 (shareholders letter agreement) and the Prospectus
Supplement No. 29 which contains the Company's Annual Report on Form 10-K for
the period ended June 30, 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.
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 October 8, 1997.
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RISK FACTORS
Financial Performance of Doctors Health
Doctors Health has a limited operating history and for the fiscal years
ended June 30, 1996 and 1997 recorded a net loss of $7.2 million and $16.2
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.
DONALD E. BARTLETT, JR.
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 ("Doctors Health HMO Plans"), (ii) Physician agrees to provide eligible
persons who elect to enroll in Doctors Health HMO Plans (each, a "Doctors Health
HMO Member") with those primary care services customarily provided by primary
care physicians, as may be required by the Doctors Health HMO Plans, (iii)
Physician will be paid cash in the amount of $7,732.90 upon execution of the
Participation Agreement and satisfactory completion of credentialling of
Physician by Doctors Health, and (iv) Doctors Health will issue to the Physician
442 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 Doctors Health 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 Doctors Health
HMO Plans. Physician is required pursuant to the Participation Agreement to
cooperate with Doctors Health in accepting Doctors Health HMO Members under the
Doctors Health 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 Doctors Health 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 Doctors Health 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, Doctors Health 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 Doctors Health HMO Members or the Doctors Health HMO Plans
for any covered services provided to Doctors Health 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 Doctors Health 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 Doctors Health 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 Doctors Health HMO members. Physicians are
required to (i) prepare and maintain customary medical records for services
provided to Doctors Health 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 Doctors Health 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
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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 coverage to Doctors Health 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
Doctors Health HMO Members. Doctors Health may use Physician's name, specialty,
telephone number and business location in marketing, descriptive and other
information relating to the Doctors Health HMO Plans. The Participation
Agreement provides that Physician may be precluded from participating in a
Doctors Health HMO product by one of the Doctors Health 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 Doctors
Health HMO Plan, provided that the payment terms of such Doctors Health 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 Doctors Health 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 Doctors Health HMO Member grievances.
Doctors Health 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
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" 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 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 Doctors Health 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
Donald E. Bartlett, Jr.
Annex B - Shareholders Letter Agreement, delivered to Physician as
Prospectus Supplement No. 26
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ANNEX A
PRIMARY CARE PARTICIPATION AGREEMENT
1. This Participation Agreement is entered into on __________________, 1997
(the "Effective Date") by Doctors Health, Inc. ("Doctors Health") and the
Physician whose name appears below.
2. Doctors Health 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.)
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 Doctors Health 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 Doctors Health and provision of
Physicians' financial statements and Medicare patient list and is subject
to modification to the extent the information received by Doctors Health
differs from the information provided on Exhibit B-3. This payment is
made based upon Physician's assurance to Doctors Health that he/she is an
actively practicing primary care physician who intends to enter into a
cooperative relationship with other Doctors Health affiliated physicians to
manage care to Doctors Health 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. Doctors Health agrees to provide Physician, once Physician has at least 100
Doctors Health Members, at no cost to the Physician, access to the Doctors
Health 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
Doctors Health (the "Doctors Health HMO Plans") those primary care services
customarily provided by primary care physicians to eligible patients, as
may be required by the Doctors Health HMO Plans. These patients are
referred to in this Agreement as the "Doctors Health HMO Members".
7. Doctors Health will credential Physician. Physician agrees to cooperate
with the Doctors Health credentialing and review process, all at no cost to
Physician.
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8. Physician agrees to participate in the managed care agreements that Doctors
Health enters into with Doctors Health HMO Plans. Physician agrees to
cooperate with Doctors Health in accepting Doctors Health HMO Members under
the Doctors Health 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
Doctors Health 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 Doctors Health of such Existing Primary Care Capitation
Contract. Physician agrees to use his or her commercially reasonable best
efforts to assist Doctors Health in replacing such Existing Primary Care
Capitation Contract with a Doctors Health HMO Plan, provided the payment
terms to the Physician under the Doctors Health HMO Plan are at or above
the payment terms of the Existing Primary Care Capitation Contract. Until
Doctors Health is able to replace the Existing Primary Care Capitation
Contract with a Doctors Health 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 Doctors Health and the Doctors Health HMO Plans.
Doctors Health provide all relevant provisions that may apply to Physician.
11. Physician agrees to work cooperatively and in good faith with Doctors
Health and the other Doctors Health affiliated physicians providing
services to the Doctors Health HMO Members. To this end, Physician will
use all reasonable efforts
- Prepare and maintain customary medical records for services provided
to Doctors Health HMO Members and provide the IPA with access to such
records without charge. Doctors Health 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 Doctors Health
affiliated physicians as part of arrangements with the Doctors Health
HMO Plans.
- Cooperate with Doctors Health'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 Doctors Health.
- Comply with Doctors Health policies and guidelines which Doctors Health
provides to physician.
12. Physician will participate in all utilization review, quality assurance and
credentialing programs operated by Doctors Health 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
Doctors Health 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 Doctors Health that are designed to resolve Doctors Health HMO Member
grievances.
13. Physician agrees not to differentiate or discriminate in the treatment of
patients as to the quality of services delivered to Doctors Health 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 Doctors Health HMO Members as patients.
14. Physician will in good faith make arrangements, with the support of
Physician's assigned Doctors Health representative, for twenty-four hours,
seven days a week coverage to Doctors Health HMO Members through other
primary care physicians who participate in the Doctors
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Health provider network to the extent the Doctors Health 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 Doctors Health regarding services provided to Doctors Health
HMO Members or any other matters relating to this Agreement, subject to all
laws regarding the confidentiality of medical records.
16. 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 medical
emergency or where Doctors Health and the Physician have agreed the Doctors
Health provider network is insufficient, Physician agrees to utilize the
Doctors Health provider network when arranging for additional medical
services required by Doctors Health HMO Members.
17. Doctors Health's affiliated physicians have developed protocols and
practice procedures applicable to fellow physician participants in the
Doctors Health provider network (the "Doctors Health Protocols").
Physician agrees to follow the Doctors Health Protocols when treating
Doctors Health HMO Members. If Physician should ever deem any aspect of
the Doctors Health Protocols to be medically inappropriate or otherwise
inappropriate for utilization by Physician, Physician may notify Doctors
Health in writing, with sufficient specificity to enable Doctors Health 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. Doctors Health is not engaged in the practice of
medicine and will not interfere in any patient treatment decisions.
19. Doctors Health may use Physician's name, specialty, telephone number(s),
and business location(s) in marketing, descriptive, and other information
relating to the Doctors Health HMO Plans, and will include Physician as a
member of the Doctors Health provider network during this Agreement.
Physician may nonetheless be precluded from participating in a Doctors
Health HMO Product by one of the Doctors Health HMO Plans. In such an
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.
20. During the calendar year 1997, Doctors Health will pay to Physician, and
Physician agrees to accept from Doctors Health as compensation for all
covered services provided by Physician to Doctors Health 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, Doctors Health shall establish in cooperation with Doctors Health
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 Doctors Health HMO Members. The Primary Care Base Capitation Ratewill
be increased by an amount up to ten percent (10%) (the "Capitation Rate
Modifier"), according to a Medicare and Commercial formula established by
Doctors Health 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 (as set forth on
Exhibit E-22 attached) which are not considered covered services according
to the Doctors Health 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 Doctors Health HMO Members while fostering
efficiencies in utilization and quality assurance, Doctors Health's
affiliated physicians have established, and Physician will participate in,
a bonus pool. The amount of bonus awards are determined according to
Doctors Health's primary care bonus point system, rewarding high clinical
quality, appropriate utilization, patient satisfaction and retention and
the extent of cooperation with other participating physicians Doctors
Health. Based upon this system, Doctors Health will fund a primary care
physician bonus pool which will be credited with 25% of the managed care
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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 Doctors Health 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 Doctors Health. Bonus Awards for
calendar year 1996 will be paid by Doctors Health in April of 1997. Awards
for calendar year 1997 will be made in April of 1998 etc. (The Doctors
Health "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 Doctors
Health 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. (For an illustration of
the flow of the healthcare dollar and an example of the PCP compensation
model, see Exhibit G-24 and Exhibit H-24 (attached), respectively.)
25. Physician understands that Doctors Health will be paid by the Doctors
Health HMO Plans for all services provided by Physician to Doctors Health
HMO Members.
26. Physician agrees not to bill or collect any reimbursement from Doctors
Health HMO Members or the Doctors Health HMO Plans unless the service
provided was not a covered service under the Doctors Health HMO Plan and
the Doctors Health HMO Member was given prior written notice that the
services would not be covered. However, Physician may charge, bill,
collect and keep from Doctors Health 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 Doctors Health or Doctors Health insolvency, will Physician
make any claims, other than for copayments or coinsurance, against any
Doctors Health 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 Doctors Health with copies of
the policies or other evidence of compliance with the insurance
requirements. Physician will notify Doctors Health 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 Doctors Health 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 Doctors Health with a copy of this
endorsement.
28. This Agreement may be terminated by Physician upon 90 days prior written
notice to Doctors Health if Doctors Health fails to perform its obligations
to Physician or to pay any amounts required to be paid by Doctors Health to
Physician.
29. Doctors Health 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 Doctors Health 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 Doctors Health Protocols.
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- Physician takes any action which puts a Doctors Health HMO Members'
health at risk.
- Physician loses his/her license or certificate to practice medicine.
30. To the extent required to enable Doctors Health 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 Donald E. Bartlett, Jr., M.D.
DOCTORS HEALTH, INC.
By:________________________(SEAL)
Stewart B. Gold, President
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EXHIBIT A-2
Schedule of Services
I. 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 Doctors Health Referral Management Program
provides for the maintenance of referral directories; authorization of
Doctors Health referrals to network providers; clinical review of
referrals for appropriateness, according to Doctors Health physician
approved criteria; and tracking and reporting of referral patterns to
identify outliers and encourage recommendations for change.
C. Utilization Management. The Doctors Health 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 Doctors Health 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.
II. Data Management. The Doctors Health 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.
III.Patient Services. Doctors Health 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.
IV. Third Party Administration. The Doctors Health Third Party Administration
services provide for the appropriate adjudication of claims, coordination
of benefits, subrogation services and integration with the reinsurance
carrier.
A-7
<PAGE>
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
$ 442,125.00.
2. The number of Physician's active (1) Medicare patients is 287.
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 $ 7,732.90.
2. 221 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.
- - - -------------------
(1) Patients who have made at least one office visit to Physician during the
last two years.
A-8
