26-010 - HCM SAMPLE CONTRACT.docx

CONTRACT NO. «Contract Number» (“Contract”)

BETWEEN

ORANGE COUNTY HEALTH AUTHORITY, A PUBLIC AGENCY, dba ORANGE PREVENTION & TREATMENT INTEGRATED MEDICAL ASSISTANCE, dba CALOPTIMA HEALTH (“CalOptima”) And «Company Name» (“Contractor”) This Contract is made and entered into as of [insert date] (“Effective Date”), by and between the Orange County Health Authority, a public agency dba CalOptima Health, (“CalOptima”) and «Company Name», a «Business Entity», “Contractor.” CalOptima and Contractor may be referred to collectively as the “Parties” or each individually as a “Party.”

RECITALS

A. CalOptima desires to retain a contractor to provide «Description», as described in the Scope of Work in Exhibit A;

B. Contractor provides such services;

C. Contractor desires to perform these services for CalOptima; and D. CalOptima and Contractor desire to enter into this Contract on the terms and conditions set forth below.

NOW, THEREFORE, the Parties agree as follows:

1. Documents Constituting Contract. “Contract Documents” include the following documents in the order of descending precedence: (i) this Contract, inclusive of all its exhibits and addenda; (ii) CalOptima’s Request for Proposals «Current RFP Number» (“RFP”), if applicable, inclusive of any CalOptima revisions and addenda prior to the Effective Date; (iii) Contractor’s best and final offer dated [Insert Date of Best and Final Offer], if applicable, and; (iv) Contractor’s proposal dated [Insert Date Contractor’s Response to RFP] (“Proposal”). Any new terms and conditions attached to Contractor’s best and final offer, Proposal, invoices, or request for payment shall not be incorporated into the Contract Documents or be binding upon CalOptima unless expressly accepted by CalOptima in writing. All Contract Documents are incorporated into this Contract by this reference. No changes to the Contract or the Contract Documents will be binding upon CalOptima unless specifically confirmed in writing by an authorized representative of CalOptima. In the event of any conflict of provisions among the Contract and/or Contract Documents, the provisions shall prevail in the above-referenced descending order of precedence.

2. Scope of Work.

Contractor shall perform the work in accordance with (i) this Contract, including the Scope of Work in Exhibit A, (ii) the Contract Documents, (iii) the applicable standards and requirements of the Centers for Medicare and Medicaid Services (“CMS”), the California Department of Health Care Services (“DHCS”), and the California Department of Managed Health Care (“DMHC”), and (iv) all applicable laws.

3. Insurance.

3.1 At Contractor’s sole expense and prior to undertaking performance of services under this Contract and at all times during performance, Contractor must maintain insurance policies and amounts set forth in this Contract, as full-coverage insurance in accordance with applicable laws and industry standards. Contractor may not of its own initiative cause such insurance to be canceled or materially changed during the Term.

3.2 Contractor shall maintain the following insurance policies during the Term. For insurance purposes, “Occurrence” means any event or related exposure to conditions that result in injury or damage to persons, property, or CalOptima.

3.2.1 Commercial General Liability Insurance, including Contractual, Independent Contractors, Products/Completed Operations and Personal Injury Liability, with the following minimum limits of liability:

3.2.1.1 Primary Bodily Injury Liability with limits of $1,000,000 per Occurrence; and

3.2.1.2 Primary Property Damage Liability with limits of one million dollars $1,000,000 per Occurrence, or combined single limits of liability for Primary Bodily Injury and Primary Property Damage of $2,000,000 per Occurrence and in the aggregate.

3.2.2 If Contractor is on CalOptima’s premises, Automobile Liability with the following minimum limits of liability:

3.2.2.1 Primary Bodily Injury Liability with limits of $1,000,000 per Occurrence; and

3.2.2.2 Primary Property Damage Liability with limits of $1,000,000 per occurrence or combined single limits of liability for Primary Bodily Injury and Primary Property Damage of $2,000,000 per Occurrence and in the aggregate.

3.2.3 Workers’ Compensation Insurance within the limits established and required by the State of California.

3.2.4 Employer’s Liability with limits of $1,000,000.

3.2.5 Professional Liability with a combined single limit of at least $1,000,000 per Occurrence and in the aggregate.

3.2.6 Commercial crime policy covering employee theft and dishonesty, forgery and alteration, money orders and counterfeit currency, credit card fraud, wire transfer fraud, and them of client property with $1,000,000 limits per Occurrence.

3.2.7 Cyber Liability insurance with $1,000,000 for each Occurrence and $1,000,000 aggregate, covering first and third-party claims involving privacy violations, data breaches, information theft, damage to or destruction of electronic information, intentional and/or unintentional release of private information, alteration of electronic information, extortion and network security. Such coverage shall provide for costs of legal fees, forensic expenses, regulatory fines and penalties, notification expenses, credit monitoring and ID theft repair, public relations expenses, and costs of liability and defense.

3.3 Within five days of the Effective Date and prior to commencing performance of any services or its receipt of any compensation under the Contract, Contractor shall furnish to CalOptima, with additional insured endorsements, broker-issued Certificates of Insurance showing the required insurance coverages for Contractor. Contractor’s Certificates of Insurance shall additionally comply with the following:

3.3.1 CalOptima’s officers, officials, directors, employees, agents, and volunteers are to be covered as additional insureds with respect to liability arising out of work or operations performed by or on behalf of Contractor, including materials, parts, or equipment furnished in connection with such work or operations. This provision applies to Contractor’s General Liability policy, as applicable, and must be on ISO form CG 20 10 or equivalent.

3.3.2 For any claims related to this Contract, the Contractor’s insurance coverage shall be primary insurance with respect to CalOptima, its officers, officials, directors, employees, agents, and volunteers. This provision applies to the Contractor’s General Liability and Workers’ Compensation and Employers’ Liability policies, as applicable.

3.3.3 Contractor’s insurance carrier agrees to waive all rights of subrogation against CalOptima and its elected or appointed officers, officials, directors, agents, and employees for losses paid under the terms of any policy which arise from work performed by the Contractor for CalOptima. This provision applies to the Contractor’s General Liability and Workers’ Compensation and Employers Liability policies.

3.3.4 Insurance is to be placed with insurers with a current A.M. Best rating of no less than A- VII, unless otherwise acceptable to CalOptima.

3.3.5 Contractor shall furnish CalOptima with original certificates and amendatory endorsements affecting required coverage. CalOptima may require complete, certified copies of all required insurance policies, including endorsements, at any time in the event of a claim, legal need, or request from an agency with authority over CalOptima.

3.3.6 CalOptima reserves the right to approve or reject any deductibles or self-insured retentions. CalOptima may require the Contractor to purchase coverage with a lower deductible or retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention or deductible.

3.3.7 All deductibles and retentions that the aforementioned policies contain are the responsibility of the Contractor and in no way shall CalOptima be responsible for payment of the deductibles/retentions.

3.3.8 If Contractor maintains higher limits than the minimums required in this Contract, CalOptima requires and shall be entitled to coverage for the higher limits maintained by Contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to CalOptima.

3.3.9 Require the insurance carrier to provide thirty days’ prior written notice of cancellation to CalOptima.

3.4 If Contractor fails or refuses to maintain or produce proof of the insurance required by CalOptima, CalOptima may terminate this Contract upon written notice to Contractor. Such termination shall not affect Contractor’s right to be paid for its time and materials expended prior to notification of termination. Contractor waives the right to receive compensation and agrees to indemnify CalOptima for any claims arising from work performed if CalOptima informs Contractor that the insurance or certificates are unsatisfactory.

3.5 The requirement for carrying the required insurance shall not derogate from the provisions for indemnification of CalOptima.

3.6 Contractor shall require each of its subcontractors who perform services related to this Contract, if any, to maintain insurance coverage that meets all of the requirements set forth in this Contract.

4. Limitation Of Liability. EXCEPT FOR BREACHES OF CONFIDENTIALITY OBLIGATIONS UNDER THE CONTRACT, DAMAGES ARISING FROM PERSONAL INJURY OR INJURY TO PHYSICAL PROPERTY, INDEMNIFICATION OBLIGATIONS, THE OBLIGATION OF INSURANCE UNDER THE CONTRACT, OR AS OTHERWISE EXPRESSLY SET FORTH IN THIS CONTRACT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY LOST PROFITS OR FOR ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL OR INDIRECT DAMAGES ARISING FROM OR RELATED TO THE CONTRACT, REGARDLESS OF THE CAUSE OF ACTION, EVEN IF THE PARTIES HAVE BEEN APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES

5. Indemnification.

5.1 To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless CalOptima and its respective officers, directors, agents, volunteers, consultants and employees (individually and collectively referred to as “Indemnified Parties”) against any and all third-party claims, losses, demands, damages, costs, expenses, or liability to the extent caused by Contractor’s, or its officers, employees, subcontractors, agents, or representatives’, breach of this Contract, negligence, recklessness, or intentional conduct, except to the extent any such loss was caused by the gross negligence, recklessness, or intentional misconduct of CalOptima. Contractor shall defend the Indemnified Parties in any claim or action based upon any such alleged acts or omissions at its sole expense, which shall include all costs and fees, including attorneys’ fees, cost of investigation, defense, and settlement or awards. CalOptima may make all reasonable decisions with respect to its representation in any legal proceeding. Contractor’s duty to defend herein is wholly independent of and separate from the duty to indemnify and such duty to defend shall exist except for claims arising through the sole negligence or sole willful misconduct of CalOptima

5.2 Contractor’s obligation to indemnify hereunder is in addition to any liability Contractor may have to CalOptima for a breach by Contractor of any of the provisions of this Contract. Under no circumstances shall the insurance requirements and limits set forth in this Contract be construed to limit Contractor’s indemnification and duty to defend obligation or other liability hereunder

5.3 Contractor’s indemnification and duty to defend obligations shall survive the expiration or earlier termination of this Contract until such time as any action against the Indemnified Parties for such a matter indemnified hereunder is fully and finally barred by the applicable statute of limitations, including those set forth under the California Government Claims Act (Cal. Gov. Code §900 et seq.).

5.4 In the event of any conflict between this section on indemnity and the indemnification provisions set forth elsewhere in the Contract, including any business associate agreement (“BAA”) between the Parties, the indemnification provisions in the BAA or elsewhere in the Contract shall be interpreted to relate only to matters within the scope of the BAA or those other Contract provisions.

5.5 The terms of this Section shall survive the termination of this Contract.

6. Independent Contractor. Contractor, including all subcontractors, agents, and employees of the Contractor, in performance of this Contract, will act in an independent capacity, and not as officers or employees of CalOptima. Contractor’s relationship with CalOptima in the performance of this Contract is that of an independent contractor and nothing in this Contract shall be construed as creating a partnership, joint venture, or agency. Contractor’s personnel performing services under this Contract shall be at all times under Contractor’s exclusive direction and control and shall be employees of Contractor and not employees of CalOptima. Contractor shall pay all wages, salaries and other amounts due its employees, agents, and/or subcontractors in connection with this Contract and will be responsible for all reports and obligations respecting them, such as social security, state and federal income tax withholding, other payroll taxes, unemployment compensation, workers’ compensation, and similar matters. Contractor shall file all required returns related to such taxes, contributions, and payroll deductions.

7. Personnel.

7.1 Contractor Staffing. Contractor shall ensure that only fully qualified Contractor personnel are assigned to perform the Professional Services under the Contract, and such Contractor personnel shall perform services diligently and in a timely manner, according to the applicable professional and technical standards.

7.2 Any CalOptima property damaged by Contractor, its subcontractors, or by the personnel of either, will be subject to repair or replacement by Contractor at no cost to CalOptima.

8. Compensation.

8.1 CalOptima agrees to pay, and Contractor agrees to accept as full compensation for the faithful performance of this Contract, the rates, charges, and other payment terms identified in Exhibit B.

8.2 CalOptima will not reimburse Contractor any expenses incurred in connection with its performance of the services, unless such reimbursement is specifically authorized in Exhibit B. Each expense reimbursement request, when authorized in Exhibit B must include receipts or other suitable documentation.

8.3 Contractor’s requests for payments and reimbursements must comply with the requirements of CalOptima. CalOptima will not make payment for work that fails to meet the standards of performance set forth in the Contract, and will not pay any fees, expenses, or costs whatsoever incurred by contractor in rendering additional services not authorized in writing by CalOptima under this contract.

8.4 In no event shall the total compensation payable to Contractor for the services performed under this Contract exceed the maximum cumulative payment obligation, as set forth in Exhibit B, without the express prior written authorization of CalOptima. Contractor acknowledges and agrees that CalOptima shall not be liable for any fees, expenses or compensation in excess of the maximum cumulative payment obligation.

8.5 The maximum cumulative payment obligation includes all applicable federal, state, and local taxes and duties, except sales tax, which is shown separately, if applicable. Contractor is responsible for submitting any withholding exemption forms (e.g., W-9) to CalOptima. Such forms and information should be furnished to CalOptima before payment is made. If taxes are required to be withheld on any amounts otherwise to be paid by CalOptima to Contractor due to Contractor’s failure to timely submit such forms, CalOptima will deduct such taxes from the amount otherwise owed and pay them to the appropriate taxing authority and shall have no liability for or any obligation to refund any payments withheld.

9. Confidential Material.

9.1 During the Term, either Party may have access to confidential material or information (“Confidential Information”) belonging to the other Party or the other Party’s customers, vendors, or partners. Confidential Information includes the disclosing Party’s computer programs and codes, business plans, customer/member lists and information, financial records, partnership arrangements, projections, methodologies, data, reports, agreements, intellectual property, trade secrets, licensing plans, and other proprietary information, or other information, materials, records, writings or data that is marked confidential or that due to its character and nature, a reasonable person under like circumstances would treat as confidential. CalOptima’s Confidential Information also includes all user information, patient information, and clinical data that comes into CalOptima’s possession, custody or control. Confidential Information will be used only for the purposes of this Contract and related internal administrative purposes. Each Party agrees to protect the other’s Confidential Information at all times and in the same manner as each protects the confidentiality of its own confidential materials, but in no event with less than a reasonable standard of care.

9.2 For the purposes of this Section, Confidential Information does not include information which: (i) is already known to the other Party at the time of disclosure; (ii) is or becomes publicly known through no wrongful act or failure of the receiving Party; (iii) is independently developed without use or benefit of the other Party’s Confidential Information or proprietary information; (iv) is lawfully received from a third party that is not under and does not thereby breach an obligation of confidentiality; or (v) is a public record, not exempt from disclosure, pursuant to California Public Records Act, Government Code Section 6250 et seq., applicable provisions of California Welfare and Institutions Code, or other state or federal laws, regardless of whether such information is marked as confidential or proprietary.

9.3 Disclosure of the Confidential Information will be restricted to the receiving Party’s employees, consultants, suppliers, or agents, who are bound by confidentiality obligations no less stringent than those in this Section, on a “need to know” basis in connection with the services performed under this Contract. The receiving Party may disclose Confidential Information pursuant to legal, judicial, or administrative proceeding or otherwise as required by law; provided, however, that the receiving Party gives reasonable prior notice, if not prohibited by applicable law, to the disclosing Party and assists the disclosing Party, at the disclosing Party’s expense, to obtain protective or other appropriate confidentiality orders, and further provided that a required disclosure of Confidential Information or proprietary information to an agency or court does not relieve the receiving Party of its confidentiality obligations with respect to the other Party.

9.4 Contractor shall establish and maintain environmental, safety, and facility procedures, data security procedures and other safeguards against the unauthorized access, destruction, loss, or alteration of CalOptima’s Confidential Information in the possession, custody, or control of Contractor. Those security procedures and other safeguards shall be no less rigorous than those maintained by Contractor for its own information of a similar nature.

9.5 Upon written request of the disclosing Party, the receiving Party shall promptly return to the disclosing Party or destroy all documents, notes, and other tangible materials representing the disclosing Party’s Confidential Information and all copies thereof. This obligation to return materials or copies thereof does not extend to automatically generated computer backup or archival copies generated in the ordinary course of the receiving Party’s information systems procedures, provided that the receiving Party shall make no further use of such copies.

9.6 If a breach of the obligations under this Section occurs, the injured Party may be entitled to such equitable relief and any and all other remedies available at law or in equity to prevent further breach, including injunctive relief without the necessity to prove actual monetary damages or post a bond. This Section 8 in no way limits the liability or damages that may be assessed against a Party if another Party breaches any of the provisions of this Section.

9.7 This Contract does not require or permit Contractor to create, receive, maintain, use, or transmit protected health information (“PHI”). As such, no BAA is required for this Contract; provided, however, that if Contractor or its employees, agents, or subcontractors access or receive, whether intentionally or unintentionally, PHI regarding CalOptima members during the Term, CONRACTOR and its employees, agents, and subcontractors shall immediately notify CalOptima, protect such PHI from any additional disclosure, not use or disclose that PHI in any way that would violate a federal or state privacy or security law, its implementing regulations, or any other state or federal law, and execute a BAA with CalOptima, as necessary and requested by CalOptima.

10. California Public Records Act. As a local public agency, CalOptima is subject to the California Public Records Act (California Government Code Sections 6250 et seq.) (the “PRA”). Contractor hereby acknowledges that any materials, documents, data, or similar items are subject to disclosure upon public request, unless exempt from disclosure under the provisions of the PRA. CalOptima may be required to reveal certain information pursuant to the PRA believed to be proprietary or confidential by Contractor. If Contractor discloses information that it believes to be proprietary or confidential to CalOptima, it shall mark such information as “Confidential,” “Proprietary,” or “Restricted” or other similar marking. Unless Contractor marks its materials as “Confidential,” “Proprietary,” or “Restricted,” and also notifies CalOptima in writing that Contractor has so marked each piece of material, then CalOptima will not be responsible to take any actions to protect any Contractor’s materials under the PRA that are not so marked. If CalOptima receives a request under the PRA that potentially encompasses Contractor materials that have been properly marked, CalOptima will provide Contractor with notice thereof to allow Contractor to take actions it deems appropriate to prevent disclosure of the marked material. Within five days from receipt of CalOptima’s notice, Contractor shall notify CalOptima if it intends to object to production of Contractor’s information; otherwise CalOptima will respond to the PRA request according to the requirements of the PRA. Contractor agrees to defend, indemnify, and hold harmless CalOptima, its officers, agents, employees, members, subsidiaries, joint venture partners, and predecessors and successors in interest from and against any claim, action, proceeding, liability, loss, damage, cost, or expense, including attorneys’ fees, and any costs awarded to the person or entity that sought Contractor’s marked material, arising out of or related to CalOptima’s failure to produce or provide the Contractor-marked material (collectively referred to for purposes of this Section as “Public Records Act Claims”). Contractor shall pay to CalOptima any expenses or charges relating to or arising from any such Public Record Act Claimsd as they are incurred by CalOptima.

11. Modifications. CalOptima may modify the Contract upon written notice to Contractor at any time should such modification be required by CMS, DHCS, the DMHC, Covered California, any other regulator with jurisdiction over the Parties, or any applicable statute or regulation (“Regulatory Amendment”). Any other modifications of the Contract that are not Regulatory Amendments shall be executed only by a written amendment to the Contract, signed by CalOptima and Contractor. Execution of amendments shall be contingent upon Contractor’s notification to CalOptima, and CalOptima’s approval, of any increase or decrease in the price of this Contract or in the time required for Contractor’s performance.

12. Assignments.

12.1 Contractor may not assign, transfer, or delegate any interest herein, either in whole or in part, without the prior written consent of CalOptima, which consent may be withheld in its sole discretion. If CalOptima provides such prior written consent, Contractor acknowledges and agrees that such assignment, transfer, or delegation may additionally be subject to the prior written approval of DHCS. Any assignment, transfer, or delegation made without CalOptima’s express written consent shall be void.

12.2 An assignment is: (1) the change of more than 50% of the ownership or equity interest in Contractor (whether in a single transaction or in a series of transactions); (2) the change of more than 50% of the directors or trustees of Contractor (whether in a single transaction or in a series of transactions); (3) the merger, reorganization, or consolidation of Contractor with another entity with respect to which Contractor is not the surviving entity; and/or (4) a change in the management of Contractor from management by persons appointed, elected or otherwise selected by the governing body of Contractor (e.g., the Board of Directors) to a third-party management person, company, group, team or other entity.

13. Subcontracts. Contractor may not subcontract or delegate its obligations or the performance of services under this Contract without CalOptima’s prior written consent, which CalOptima may exercise in its sole discretion. CalOptima-approved subcontractors are listed in Addendum 2 to Exhibit A.

14. Term. This Contract shall commence on the Effective Date and shall continue in full force and effect through «Current Expiration» (“Initial Term”), unless earlier terminated as provided in this Contract. At the end of the Initial Term, CalOptima may, at its option, extend this Contract for up to «Extended Term spelled» («Extended Term») additional consecutive one year terms (“Extended Terms”), provided that if CalOptima does not exercise its option to extend at the end of the Initial Term, or any Extended Term, the remaining options shall automatically lapse. The Initial Term together with any Extended Terms constitute the “Term” of this Contract.

15. Termination.

15.1 Termination without Cause. CalOptima may terminate this Contract at any time, in whole or in part, for its convenience and without cause, by giving Contractor thirty days’ prior written notice. Upon termination, CalOptima shall pay Contractor all fees and other charges due and payable for services satisfactorily performed and accepted by CalOptima as of the termination date. Thereafter, Contractor shall have no further claims against CalOptima under this Contract and Contractor shall refund CalOptima any fees paid by CalOptima for services or deliverables that remain unperformed or undelivered as of the effective date of termination, including a pro-rata refund for any prepaid fees for terminated subscriptions and/or licenses calculated as of the effective date of termination under this section.

15.2 Termination for Unavailability of Funds. In recognition that CalOptima is a governmental entity and its operations and budgets are determined on an annual basis, CalOptima shall have the right to terminate this Contract as follows:

15.2.1 CalOptima may terminate this Contract if it does not receive funding from the State of California or the federal government, as applicable, for any fiscal year.

15.2.2 In the event of termination for Unavailability of Funds, CalOptima agrees to promptly pay Contractor all fees and other charges due and payable for services satisfactorily performed and accepted by CalOptima as of the termination date. Contractor shall not be entitled to payment for any other items, including lost or anticipated profit on work not performed, administrative costs, attorneys’ fees, or consultants’ fees.

15.3 Termination for Insolvency. CalOptima may immediately terminate this Contract upon notice to Contractor for (i) Contractor’s bankruptcy, (ii) if a federal or state proceeding for the relief of debtors is undertaken by or against Contractor; or (iii) if Contractor makes an assignment for the benefit of creditors.

15.4 Termination for Breach. Either Party may at its option, terminate this Contract by notice to the other Party if the other Party breaches one of its obligations under this Contract and fails to cure that breach or default within thirty days after receiving notice identifying that breach, provided that the non-breaching party may terminate the Contract immediately upon written notice if the non-breaching Party reasonably determines that cure of the default within thirty days is impossible. The rights described in this Section to terminate this Contract shall be in addition to any other remedy available to the non-breaching Party, whether under this Contract or in law or equity, on account of that breach.

15.5 Notwithstanding the foregoing, CalOptima may terminate this Contract immediately upon written notice following Contractor’s breach of requirements regarding Insurance or Confidential Material, or as required by a government regulator with jurisdiction over CalOptima.

15.6 Effect of Termination.:

15.6.1 Upon contract expiration or receipt of a termination notice from CalOptima, Contractor shall promptly discontinue all services (unless CalOptima’s notice directs otherwise) and deliver or otherwise make available to CalOptima all documents, reports, software programs, and any other products, data and such other materials, equipment, and information, including Confidential Information, or equipment provided by CalOptima, as may have been accumulated by Contractor in performing this Contract, whether completed or in process. If Contractor personnel were granted access to CalOptima’s premises and issued a badge or access card, such badge or access card shall be returned prior to departure.

15.6.2 If (i) Contractor receives a termination notice from CalOptima and stops satisfactorily performing services prior to the termination date, as determined by CalOptima in its discretion, or (ii) CalOptima receives a termination notice from Contractor, CalOptima may take over the services and may award another party a contract to complete the services under this Contract. If CalOptima takes over the services, CalOptima shall have no further obligation to pay Contractor for services rendered by Contractor after CalOptima assumed responsibility for those services under this section

15.6.3 In the event of termination by for Contractor’s insolvency or breach, Contractor will be liable for all reasonable costs incurred by CalOptima of such a termination.

16. Dispute Resolution

16.1 Meet and Confer. If either Party has a dispute arising under or related to this Contract, the Parties shall informally meet and confer to try and resolve the dispute. The Parties shall meet and confer within thirty days of a written request submitted by either Party in an effort to settle any dispute. At each meet-and-confer meeting, each Party shall be represented by persons with final authority to settle the dispute. If either Party fails to meet within the thirty-day period, that Party shall be deemed to have waived the meet-and-confer requirement, and at the other Party’s option, the dispute may proceed immediately to arbitration under this contract.

16.2 Subject to the California Government Claims Act (Cal. Gov. Code §900 et seq.) governing claims against public entities, either Party may submit the dispute for resolution exclusively through confidential, binding arbitration, instead of through trial by court or jury, in Orange County, California. The Parties may agree in writing prior to commencing the arbitration on the dispute resolution rules and arbitration service that will be used to resolve the dispute. If the Parties cannot reach such an agreement, the arbitration will be conducted by Judicial Arbitration and Mediation Services (“JAMS”) in accordance with the commercial dispute rules then in effect for JAMS; provided, however, that this Contract shall control in instances where it conflicts with JAMS’s (or the applicable arbitration service’s) rules. The arbitration shall be conducted on an expedited basis by a single arbitrator. The Parties prefer that the arbitrator be a retired judge of the California Superior, Appellate, or Supreme Court or of a United States court sitting in California. If no such retired judge is available, the arbitrator may be an attorney with at least fifteen years of experience, including at least five years in managed health care. If the Parties are unable to agree on the arbitrator within thirty days of the date that the arbitration service accepts the arbitration, the arbitrator shall be selected by the arbitration service from a list of four potential arbitrators (all of whom shall be on arbitration services’ panel of arbitrators) submitted by the Parties, two from each side; provided, however, that nothing stated in this section shall prevent a Party from disqualifying an arbitrator based on a conflict of interest. In making decisions about discovery and case management, it is the Parties’ express agreement and intent that the arbitrator at all times promote efficiency without denying either Party the ability to present relevant evidence. In reaching and issuing decisions, the arbitrator shall have no jurisdiction to make errors of law and/or legal reasoning. The Parties shall share the costs of arbitration equally, and each Party shall bear its own attorneys’ fees and costs.

16.3 Exclusive Remedy. With the exception of any dispute that under applicable laws may not be settled through arbitration, arbitration is the exclusive method to resolve a dispute between the Parties arising out of or relating to this Contract that is not resolved through the meet-and-confer processes.

16.4 Waiver. By agreeing to binding arbitration, the Parties acknowledge that they are waiving certain substantial rights and protections which otherwise may be available if a dispute between them was determined by litigation in a court, including the right to a jury trial, attorneys’ fees, and certain rights of appeal.

17. Information and Cyber Security. Contractor must have policies, procedures, and practices that address its information and cyber security measures, safeguards, and standards, including at least the following:

17.1 Access Controls. Access controls, including Multi-Factor Authentication, to limit access to Contractor’s information systems and any CalOptima information that Contractor maintains or can access.

17.2 Encryption. Use of encryption to protect any CalOptima information, in transit and at rest, that Contractor maintains or can access.

17.3 Security. Safeguards for the security of the information systems and CalOptima information that Contractor maintains or can access, including hardware and software protections such as network firewall provisioning, intrusion and threat detection controls designed to protect against malicious code and/or activity, physical security controls, and personnel training programs that include phishing recognition and proper data management hygiene.

17.4 Software Maintenance. Software maintenance, support, updates, upgrades, third-party software components and bug fixes such that the software is, and remains, secure from vulnerabilities in accordance with the applicable industry standards.

17.5 Network Security. Network security that conforms to generally recognized industry standards and best practices.

17.6 “Multi-Factor Authentication” means authentication through verification of at least two of the following types of authentication factors: (i) knowledge factors, such as a password; (ii) possession factors, such as a token or text message on a mobile phone; (iii) inherence factors, such as a biometric characteristic; or (iv) any other industry standard and commercially accepted authentication factors.

18. General Provisions.

18.1 Non-Exclusive Relationship. This is a non-exclusive relationship between CalOptima and Contractor. CalOptima may have any of the services that are the subject of this Contract performed by CalOptima personnel or enter into contractual arrangements with one or more contractors who can provide CalOptima with similar or like services.

18.2 Compliance with Applicable Law and Policies. Contractor warrants that, in the performance of this Contract, it shall, at its own expense, observe and comply with all applicable federal, state, and local laws, and CalOptima vendor policies relating to services under the Contract that are in effect when this Contract is signed or that come into effect during the Term and are available to Contractor on CalOptima’s website.

18.3 Names and Marks. Neither Party shall use the name, logo or other proprietary mark of the other Party in any press release, advertising, promotional, marketing or similar publicly disseminated material without obtaining the other Party’s express written approval of the material and consent to such use.

18.4 Choice of Law. This Contract shall be governed by and construed in accordance with all laws of the State of California. If any Party institutes legal proceedings to enforce or interpret this Contract, venue and jurisdiction shall be in the County of Orange, California.

18.5 Force Majeure. When satisfactory evidence of a cause beyond a Party’s control is presented to the other Party, and nonperformance is unforeseeable, beyond the control, and not due to the fault of the Party not performing, a Party shall be excused from performing its obligations under this Contract during the time and to the extent that it is prevented from performing by such cause, including any incidence of fire, flood, acts of God, commandeering of material, products, plants or facilities by the federal, state or local governments, or a material act or omission by the other Party. A Party invoking this clause shall provide the other Party with prompt written notice of any delay or failure to perform that occurs by reason of force majeure. If the force majeure event continues for a period of 30 days, the Party unaffected by the force majeure event may terminate this Contract upon notice to the other Party without further liability or obligation to the other Party.

18.6 Notices. All notices required or permitted under this Contract must be in writing and delivered to the addresses set forth below. Any notice not related to termination of this Contract may be sent electronically to the other Party’s e-mail address listed in this section or such other address as may be provided by a Party to the other Party from time to time. If notice relates to termination of this Contract, such notice must be sent by registered or certified mail, postage prepaid, return receipt requested, or by any other overnight delivery service that delivers to the noticed destination and provides proof of delivery to the sender. Notices shall be effective (i) when first received by the party, or (ii) upon refusal of delivery by the Party to which it was sent. Any Party whose address changes during the term shall promptly notify the other Party in writing. If CalOptima cannot complete notice under this Section because Contractor’s addresses are incorrect and/or Contractor failed to notify CalOptima of the change, CalOptima may provide notice, including for Contract termination, in any manner reasonably calculated to give Contractor actual notice

CalOptima Health

505 City Parkway West

Orange, CA 92868

18.7 Notice of Labor Disputes. Whenever Contractor has knowledge that any actual or potential labor dispute may delay this Contract, Contractor shall immediately notify and submit all relevant information to CalOptima.

18.8 No Liability of County of Orange. As required under Ordinance No. 3896 of the County of Orange, State of California, as amended, the Parties agree that the obligations of CalOptima under this Contract are solely the obligations of CalOptima, and the County of Orange, State of California, shall have no obligation or liability related to this Contract. [County of Orange Ordinance No 3896, codified in Orange County Municipal Code Section 4-11-7(a)]

18.9 Entire Agreement. This Contract, including all exhibits, addenda, and Contract Documents, contains the entire agreement between Contractor and CalOptima with respect to the subject matter of this Contract, and it supersedes all prior written or oral and all or contemporaneous oral agreements, representations, understandings, discussions, negotiations, and commitments between Contractor and CalOptima, whether express or implied, with respect to the subject matter of this Contract.

18.10 Waiver. Any failure of a Party to insist upon strict compliance with any provision of this Contract shall not be deemed a waiver of such provision or any other provision of this Contract. To be effective, a waiver must be in a writing that is signed and dated by the Parties. A waiver by either of the Parties of a breach of any of the covenants, conditions, or agreements to be performed by the other Party shall not be construed to be a waiver of any succeeding breach of the Contract or of any other covenant or condition of the Contract. Any information delivered, exchanged, or otherwise provided hereunder shall be delivered, exchanged, or otherwise provided in a manner that does not constitute a waiver of immunity or privilege under applicable law.

18.11 Survival. The following provisions of this Contract shall survive termination or expiration of this Contract: Indemnification, Independent Contractor, Confidential Material, California Public Records Act, Effect of Termination, Dispute Resolution, Names and Marks, Choice of Law, No Liability of County of Orange, this Interpretation, Third-Party Beneficiaries), Successors and Assigns and any other Contract provisions that by their nature are intended to survive termination or expiration of this Contract.

18.12 Severability. If any section, subsection or provision of this Contract, or the application of such section, subsection or provision, is held invalid or unenforceable by any court of competent jurisdiction, the remainder of this Contract, other than that to which it is held invalid, shall remain in effect.

18.13 Interpretation. The terms of this Contract are the result of negotiation between the Parties. Accordingly, any rule of construction of contracts (including California Civil Code Section 1654) that ambiguities are to be construed against the drafting party shall not be employed in the interpretation of this Contract.

18.14 Third Party Beneficiaries. There are no intended third-party beneficiaries of this Contract. Nothing in this Contract shall be construed as conferring any rights on any other persons.

18.15 Successors and Assigns. Except as otherwise expressly provided in this Contract, this Contract will be binding on, and will inure to the benefit of, the successors and permitted assigns of the Parties. Nothing in this Contract is intended to confer upon any party other than the Parties or their respective successors and permitted assigns any rights or obligations under or by reason of this Contract, except as expressly provided in this Contract.

18.16 Without Limitation. Any reference in the Contract to “includes” or “including” means inclusion without limitation, unless otherwise distinguished within the text.

18.17 Authority to Execute. The persons executing this Contract on behalf of the Parties warrant that they are duly authorized to execute this Contract and that by executing this Contract the Parties are formally bound.

18.18 Counterparts. This Contract may be executed and delivered in one or more counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.

18.19 Recitals and Exhibits. The recitals, exhibits, and addenda attached to this Contract are made a part of the Contract by this reference.

[Signatures on following page]

IN WITNESS WHEREOF, these Parties have, by their duly authorized representatives, executed this Contract No. «Contract Number» on the day and year last shown below.

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EXHIBIT A

Scope of Work This Exhibit A, including Addendum 1, describes the services that Contractor provides under the Contract. If there is any conflict or inconsistency between the other provisions of the Contract and this Exhibit A, this Exhibit A shall control.

1. Definitions.

1.1. CalOptima Content: all information and materials provided by CalOptima, its agents or employees (regardless of form) to Contractor under this Contract, including User information, patient information control (excluding patient information, if any, that is solely owned by the patient as provided by law) , clinical data, as well as CalOptima trade secrets or proprietary information and any and all updates or modifications thereto and/or derivatives thereof made by Contractor for CalOptima.

1.2. Deliverables: all the materials/services that Contractor provides under this Contract and that are designated as a “Deliverable”.

1.3. Documentation: all operations and user manuals (operational, educational, and otherwise) made available by Contractor to CalOptima, any report, specification or other written work product produced by Contractor for or at the request of CalOptima, and all other written materials related to the Software or any of the Services, provided, that Documentation shall not include written materials relating to the source code (and not the binary code) of the Software.

1.4. Intellectual Property: patents, copyrights, trademarks, trade secrets, and other proprietary information.

1.5. Professional Services: services that require specialized education, knowledge, labor, judgment, experience, or skill and that are provided by individuals employed by the Contractor.

1.6. Software: the software described in the Documentation and Contract Documents, including Addendum 1 to this Exhibit A, the RFP and Contractor’s best and final offer, that meets all of CalOptima’s business and clinical requirements set forth in the Contract Documents, including the RFP.

1.7. Software Updates: all error corrections, maintenance releases, updates, upgrades, revisions, modifications, and enhancements of the Software that Contractor makes generally available to its licensees and their authorized end users.

1.8. Software as a Service: a method of software delivery and licensing in which software is accessed online via a subscription

1.9. User: any authorized employee or contractor of CalOptima who uses the Software in connection with the authorized business and clinical activities of CalOptima under the Contract.

1.10. Hosting Service: providing the infrastructure and technology to store and run a software application on remote servers, allowing users to access and use the software online.

2. Services.

2.3.1. User IDs and Passwords. Contractor shall provide Users with unique identification numbers and passwords upon CalOptima’s request or enable CalOptima to create such User identification numbers and passwords within CalOptima’s authorized use of the Software. Upon receipt of CalOptima’s proper written notice to Contractor, Contractor shall immediately make all additions, changes, and deletions to the User identification numbers and passwords assigned to approved CalOptima personnel.

2.3.2. CalOptima Network Access. To the extent Contractor receives access to CalOptima’s network, Contractor shall use such access solely to meet its obligations under the Contract.

2.3.3. URL Ownership. Each Party shall retain exclusive ownership of its respective URLs and Hyperlinks.

2.3.4. Safeguards and Security Backup. Contractor has established and will maintain an information security program containing appropriate administrative, technical and physical measures, including industry-standard Internet firewall technology, to protect CalOptima data against accidental or unlawful destruction, alteration, unauthorized disclosure, or access consistent with applicable laws. In addition, Contractor has established and shall maintain a commercially reasonable business continuity and disaster recovery plan and will follow such plan, including maintaining procedures for the reconstruction of lost CalOptima Content received or processed under this Contract and correcting, at CalOptima’s request, any destruction, loss or alteration of any CalOptima Content caused by Contractor.