Agent Appointment Application

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Agent Appointment Application

Anthem Blue Cross is the trade name of Blue Cross of California. Anthem Blue Cross and Anthem Blue Cross Life and Health Insurance Company are independent licensees of the Blue Cross Association. ®ANTHEM is a registered trademark. The Blue Cross name and symbol are registered service marks of the Blue Cross Association.

18080CABENABC 1/12

Agent Sales Support P.O. Box 9074 Oxnard, CA 93031-9074

SECTION 1: APPOINTMENT TYPE

Direct appointment Farmers agent Subagent appointment EGIA INC.

Agency name Agent name Agent/Agency TIN (Tax ID no.) or EIN

General agent appointment

General agent name General Agent TIN (Tax ID no.) or EIN

SECTION 2: AGENT INFORMATION

Agent/Agency name Agent TIN (Tax ID no.) or EIN

Physical address City State ZIP code

Mailing address (if different from above) City State ZIP code Business phone no. Business fax no. Primary email address

License type (attach a copy) Life Fire & Casualty

Organizational type Individual/Sole proprietor Partnership Corporation LLC Other ___________________________ Are you bilingual?

Yes No

If yes, what language(s) do you speak? Has your agent license ever been suspended,

revoked, or terminated? Yes No

If yes, please explain Are you currently appointed with Anthem Blue Cross? Yes No If yes, please enter your TIN

Agent TIN (Tax ID no.) or EIN Errors & Omissions coverage is required. Please attach a copy of your certificate.

Check box once you have attached your E&O certificate.

As stated in the agent agreement, do you understand that production requ irements must be met in order to maintain your contract with Anthem Blue Cross? Yes No

PLEASE NOTE: This application cannot be processed unless all questions have been answered and copies of your license and E&O certificate, and a check for $23.00 made payable to Anthem Blue Cross have been sent.

SECTION 3: AUTHORIZATION

I understand that commissions are payable by Anthem Blue Cross. However, in the case of Individual business being sold throug h a General Agency or when a special arrangement exists where a commission is split, a General Agency may be responsible for commission payment. In those cases, under no circumstances whatsoever shall I have any claim against Anthem Blue Cross for compensation, expenses or any other payment. I also understand that Anthem Blue Cross reserves the right to terminate my appointment and that I am solely responsible for my training, supplies and correspondence with Anthem Blue Cross. I acknowled ge that I have read, understand and agree with the terms of the agent agreement.

Agent signature

X

Date

Regional sales manager/Regional sales representative signature

X

Date If applicable: Subagent signature

X

Date General agent signature

X

Date

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Beneficiary Designation Sheet

Anthem Blue Cross is the trade name of Blue Cross of California. Anthem Blue Cross and Anthem Blue Cross Life and Health Insurance Company are independent licensees of the Blue Cross Association. ®_{ANTHEM is a registered trademark. The Blue Cross name and}

symbol are registered service marks of the Blue Cross Association.

18081CABENABC 1/12

Agent Sales Support P.O. Box 9074 Oxnard, CA 93031-9074 SECTION 1: AGENT INFORMATION

Agent name Agent TIN License no.

Address City State ZIP code

If appointed by Anthem Blue Cross/Anthem Blue Cross Life and Health Insurance Company (Anthem), I acknowledge that I may appoint a beneficiary to receive eligible renewal commissions pursuant to section 3.4 of the Agent Agreement. I acknowledge that I have been provided a copy and have read the Agent Agreement, including section 3.4, and designate the following as my beneficiary for purposes of section 3.4 of the Agent Agreement.

I acknowledge that Anthem shall only be obligated to recognize the Beneficiary on record with Anthem. If the Beneficiary designated by me here predeceases me, Anthem shall have no obligation to recognize and pay commissions to my general estate or to a successor beneficiary not named here. If any Beneficiary designated by me should die while receiving commissions pursuant to this section, I agree that Anthem shall have no obligation to recognize and pay commissions to the estate of the Bene ficiary or any beneficiary there under.

My submission of this beneficiary designation shall supersede any and all prior beneficiary designations I may have provided to Anthem.

Agent signature

X

Date

SECTION 2: BENEFICIARY - For the purpose of paragraph 3.4 of the Agent Agreement

Name Relationship to Agent Social security no.

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BCASH0033C Rev. 5/08

Anthem Blue Cross is the trade name of Blue Cross of California. Independent licensee of the Blue Cross Association.

® ANTHEM is a registered trademark of Anthem Insurance Companies, Inc. The Blue Cross names and symbols are registered marks of the Blue Cross Association.

How does Direct Deposit work? Agents authorize Anthem Blue Cross to deposit commission payments directly into their checking accounts by Electronic Funds Transfer (EFT).

How will Direct Deposit beneﬁt me? Advantages to agents include: Convenience

Faster receipt of commission payments No checks lost in the mail

Easily view your statements online £

£ £ £

How can I apply for Direct Deposit? Apply for Direct Deposit as follows:

Complete the Authorization Form on the reverse side of this page. Attach a voided check.

Submit completed form and voided check.

Mail: Anthem Blue Cross

Attn: Broker Services/EFT P.O. Box 9074

Oxnard, CA 93030-9074

Fax: 805-713-7191

Attn: Broker Services EFT 1.

2. 3.

What else do I need to know? By using the Authorization Form on the reverse side of this page to apply for EFT: Agent requests direct deposit by electronic funds transfer for his/her own purposes and convenience.

Agent recognizes that EFT is only available with this request for monthly commissions payable for Individual, Senior and Small Group business. Agent recognizes that EFT shall be subject to all rules, procedures and requirements of the banking institutions involved and of any concerned regulatory agencies.

Agent represents and warrants that this request for payment of commissions via EFT is signed by its duly authorized representative. This Individual will be the account’s contact person and he/she hereby represents and warrants that he/she is authorized to make this request on behalf of the Agent.

For more information, contact your Regional Sales Manager or call Broker Services at 800-678-4466.

£

Agent Direct Deposit

The fast, easy way to get paid

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Agent information (please print)

Paid TIN* name _____________________________________________ Paid TIN* no. ________________________________________ Account contact ____________________________________________ E-mail address _______________________________________ Agent mailing address ___________________________________________________________________________________________ *Tax Identiﬁcation Number

Bank information

Bank name ________________________________________________ Bank phone _________________________________________ Bank address _________________________________________________________________________________________________ Name on bank account ___________________________________________________________________________________________ Checking account no. _________________________________________ Transit/ABA no. _______________________________________

Authorization — must be signed by the authorized bank account holder

Agent hereby represents and warrants that this request for payment of commissions via EFT is signed by Agent’s duly authorized representative. This Individual will be the account’s contact person and he/she hereby represents and warrants that he/she is authorized to make this request on behalf of the Agent.

I hereby authorize Anthem Blue Cross or its affiliates to initiate deposits (credits) of my monthly commissions, and/or corrections to the previous credits, to the financial institution listed above. If necessary, Anthem Blue Cross or its affiliates may process withdrawal adjustments to this account in the event of overpayment. I understand that start and change requests may require up to 30 days processing prior to the effective date and during that time NONE of my commission check will be direct deposited. Stop requests will take effect in the next process cycle. This authority is to remain in full force and effect until I revoke it by giving 30 days prior written notice to Anthem Blue Cross, I also understand I will no longer receive a paper statement, but will only be able to view deposits and/or commissions online, unless I have checked the box below.

Authorized signature _______________________________________________ Name (print) ________________________________ Date ______ Title (if applicable) ________________________________________________ Phone no. __________________________________

n Check here if you must continue receiving a paper statement.

Submit completed Direct Deposit Authorization including voided check to:

Mail: Anthem Blue Cross Fax: 805-713-7191

Attn: Broker Services/EFT Attn: Broker Services/EFT P.O. Box 9074

Oxnard, CA 93030-9074

Agent Direct Deposit Authorization

Electronic Funds Transfer (EFT) of Agent Commissions

Direct Deposit to Checking Account Only

FOR ANTHEM BLUE CROSS USE ONLY

Date received ______________ Processed by _______________ Start date _________________ Date completed _____________

Check one: _____ Add new EFT _____ Change existing EFT _____ Cancel existing EFT Attach a voided check here

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0217CABENABC-CA 1/12 Page 1 of 15

Anthem Blue Cross Agent Agreement

This Agent Agreement together with any attachments hereto (the "Agreement") is made effective this _________ day of __________ 20_____ by and between Blue Cross of California dba Anthem Blue Cross, a health care service plan regulated by the California Department of Managed Health Care (“Anthem Blue Cross”), Anthem Blue Cross Life and Health Insurance Company, a life, health and disability insurer regulated by the California Department of Insurance (“Anthem Blue Cross Life and Health”) (collectively “Anthem Blue Cross") and _________________________________, ("Agent"). In consideration of the mutual covenants and agreements contained herein, Anthem and Agent agree as follows:

ARTICLE I - TERM AND TERMINATION

1.1 This Agreement shall become effective following execution by the parties and shall continue in effect until terminated as provided in this Agreement.

1.2 Termination and Modification: This Agreement may be terminated at any time by Agent or ANTHEM BLUE CROSS by either party giving thirty (30) days prior written notice thereof to the other party. The effective date of termination shall be the first day of the month following the 30-day notice period unless said notice specifies a later date. ANTHEM BLUE CROSS may modify this Agreement upon thirty (30) days prior written notification, except as provided in Section 3.1, any such modification shall not affect Agent’s rights in connection with business written with effective dates prior to the effective date of modification of this Agreement.

1.3 Termination for Cause: ANTHEM BLUE CROSS may terminate this Agreement for cause without

prior written notice to Agent at any time for any of the following occurrences: a. If Agent is a natural person, the death of Agent,

b. Revocation, suspension or expiration of Agent and/or any of its sub-agents’ licenses by the applicable state department of insurance,

c. Commission of a fraudulent, illegal, deceitful or dishonest act as determined by ANTHEM BLUE CROSS, including, but not limited to, failing to provide truthful, accurate and relevant medical information obtained with respect to an applicant for insurance,

d. Violation by Agent of any rule, policy, procedure or guideline of ANTHEM BLUE CROSS, e. Agent’s failure to comply with any provision of this Agreement, or

f. Threatening or acting in an abusive manner toward ANTHEM BLUE CROSS or any of its employees, agents, or representatives, or any Group, Subscriber or Individual Policyholder/ Member or prospective Group, Subscriber or Individual Policyholder/Member

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0217CABENABC-CA 1/12 Page 2 of 15 ARTICLE II - OBLIGATIONS OF AGENT

2.1 Agent shall use best efforts to solicit from members of the general public domiciled in California applications for only ANTHEM BLUE CROSS Individual Enrollment Plan Programs, Group Plan programs and Medicare Supplement Plan Programs identified in the commission schedules attached to and made a part of this Agreement. Agent is not authorized to solicit on behalf of ANTHEM BLUE CROSS, nor will Agent earn commissions for conversion programs or any other programs that ANTHEM BLUE CROSS shall decline to offer through Agent. Agent shall generally perform under this Agreement as described in such administrative guidelines, bulletins, directives, manuals or the like as ANTHEM BLUE CROSS may publish for agents from time to time.

2.2 Agent will service ANTHEM BLUE CROSS members enrolled through applications submitted by Agent or assigned by ANTHEM BLUE CROSS. Such service will include but not be limited to, the following:

a. acting as liaison between the member and ANTHEM BLUE CROSS if requested by ANTHEM BLUE CROSS or the member, and including but not limited to, the following:

i. assisting the member to take the proper action in connection with ANTHEM BLUE CROSS coverage when there is a change of address, change in marital status or change in dependent status.

ii. assisting a family member/dependent obtain coverage when he or she is no longer entitled to coverage as a family member – e.g., when a dependent child reaches the limiting age, or upon a divorce or dissolution of marriage.

b. maintaining a working and current knowledge of ANTHEM BLUE CROSS products and the ability to explain benefits and/or coverage.

2.3 Agent agrees to maintain such license as is necessary to transact business on behalf of ANTHEM BLUE CROSS. Agent further agrees to notify ANTHEM BLUE CROSS immediately of any expiration, termination, suspension or other action by the Department of Insurance, or any other governmental agency affecting said license(s). By entering into this Agreement, Agent represents that the license(s) of Agent has not previously been subject to suspension, termination or other disciplinary action by any governmental authority. By entering into this Agreement, Agent represents that Agent has never been convicted of a felony or a misdemeanor involving fraud, dishonesty, breach of trust, theft, misappropriation of money, or breach of any fiduciary duty. Agent further agrees to notify ANTHEM BLUE CROSS in writing immediately upon receiving notice of any misdemeanor or felony charges or any actions including but not limited to convictions by any governmental agency for commission of any act involving fraud, dishonesty, breach of trust, theft, misappropriation of money, or breach of any fiduciary duty. ANTHEM BLUE

CROSS reserves the right to require Agent to reimburse ANTHEM BLUE CROSS for any

appointment fees and any processing fees imposed by ANTHEM BLUE CROSS associated with the appointment of Agent and fees associated with terminating Agent’s appointment.

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furnished to Agent for that purpose by ANTHEM BLUE CROSS. Agent shall use best efforts to ensure that each application is fully and truthfully completed by the applicant and the completed application fully and accurately reflects and discloses the circumstances, including the health, of persons for whom coverage is sought in the application. Agent further agrees to use best efforts to direct every applicant to review the sections of ANTHEM BLUE CROSS’s application regarding the instructions for completing the health history questions and rescission. Agent further agrees to use best efforts to advise every applicant that in no event will the applicant have any coverage unless and until it is reviewed and approved by ANTHEM BLUE CROSS and a contract is issued, or if ANTHEM BLUE CROSS requires a written waiver, until the applicant agrees to accept coverage subject to the terms of such waiver.

2.5 Agent is not authorized to, and agrees not to, enter into, alter, deliver or terminate any contract on behalf of ANTHEM BLUE CROSS, extend the time for payment of charges, or bind ANTHEM BLUE CROSS in any way without the prior written approval of ANTHEM BLUE CROSS. Agent further agrees that ANTHEM BLUE CROSS reserves the right to reject any and all applications submitted by Agent.

2.6 Monies received by Agent for or on behalf of ANTHEM BLUE CROSS shall be received and held by Agent in a fiduciary capacity, shall not be commingled by Agent with personal funds of Agent, and shall be remitted to ANTHEM BLUE CROSS by no later than five (5) calendar days from the day of receipt.

2.7 Forms and Advertising:

a. Agent agrees to use only such material as provided by ANTHEM BLUE CROSS or approved in writing by ANTHEM BLUE CROSS before use, including, but not limited to: advertising in all forms, whether print or electronic; web sites and banner ads; promotional materials, enrollment and billing forms; and sales collateral.

b. Agent agrees not to make use of any advertisement, website, or any other material in which the name, logo, product name or any service mark of ANTHEM BLUE CROSS, any of its affiliates or its licensor (“ANTHEM BLUE CROSS Marks”) is used without ANTHEM BLUE

CROSS's written consent. Agent agrees to promptly cooperate with ANTHEM BLUE

CROSS's reasonable requests to amend new or previously-approved materials as necessary, in ANTHEM BLUE CROSS's sole discretion, to comply with ANTHEM BLUE CROSS

requirements.

c. Agent agrees not to make use of any advertisement, website or any other communication issued by Agent which could be mistaken for an advertisement, website or any other communication issued by ANTHEM BLUE CROSS.

d. Agent agrees not to use any ANTHEM BLUE CROSS Marks in the URL (domain name) of any website or internet "redirect" owned, controlled or used by Agent.

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amended from time to time. Any references to the Blue Brands made by Agent in its own materials are subject to review and approval by ANTHEM BLUE CROSS. Agent agrees to promptly cooperate with ANTHEM BLUE CROSS's reasonable requests to amend new or previously-approved materials as necessary, in ANTHEM BLUE CROSS’s sole discretion, to comply with the aforementioned Brand Regulations or ANTHEM BLUE CROSS

requirements.

f. LIQUIDATED DAMAGES: Agent agrees that any unauthorized use of the ANTHEM BLUE CROSS Marks will injure ANTHEM BLUE CROSS, although the amount of damage would be difficult to determine. Therefore, Agent agrees to pay ANTHEM BLUE CROSS, as liquidated damages and not as a penalty, $5,000.00 for each use of ANTHEM BLUE CROSS’s service mark(s), name or logo without ANTHEM BLUE CROSS's prior written consent plus $50.00 for each day of each such unauthorized use. (For the purpose of assessing the $50.00 per day per use damages, each individual unauthorized appearance of ANTHEM BLUE CROSS Marks, name or logo shall be a separate unauthorized use. For example, and not limiting the generality of the foregoing, each individual copy of a newspaper advertisement containing an unauthorized use published on any one day shall be a separate unauthorized use and each individual copy of any edition of a telephone directory containing an unauthorized use on each day between the initial distribution of that edition and its replacement with another edition shall be a separate unauthorized use.)

The following will only be applicable to Medicare Advantage and/or Part D Contracts:

Materials for Medicare Advantage and/or Part D Products will be in compliance with CMS regulations and/or guidance and with any other laws relating to the marketing and/or sale of such products.

2.8 Agent agrees to maintain complete records (1) of all transactions pertaining to applications submitted to and accepted by ANTHEM BLUE CROSS, (2) as may be required by the California Department of Insurance, or California Department of Managed Health Care or any other governmental entity, (3) in connection with Agent’s relationship with ANTHEM BLUE CROSS. Any and all records described above or as may otherwise relate to Agent’s activities in connection with ANTHEM BLUE CROSS business shall be accessible and available to representatives of ANTHEM BLUE CROSS who may audit them from time to time while this Agreement is in effect or within one (1) year after termination thereof.

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2.10 Agent agrees that ANTHEM BLUE CROSS has the right to discontinue, modify, or exercise all lawful rights in connection with any of its benefit contracts or programs without liability to Agent. Agent may sell only those products specifically authorized.

2.11 Agent shall seek compensation for performing under this Agreement only from ANTHEM BLUE CROSS. Agent is an independent contractor and shall have no claim to compensation except as provided in this Agreement and shall not be entitled to reimbursement from ANTHEM BLUE CROSS for any expenses incurred in performing this Agreement. Agent further agrees that to the extent of any indebtedness of Agent to ANTHEM BLUE CROSS, ANTHEM BLUE CROSS shall have a first lien against any commissions due Agent, and such indebtedness may be deducted at ANTHEM BLUE CROSS’s option from commissions due to Agent.

2.12 Agent agrees to maintain the confidentiality of any trade secret or proprietary information of ANTHEM BLUE CROSS. Agent’s obligations under this paragraph 2.12 shall survive termination of this Agreement.

2.13 Agent will attend, at Agent’s sole expense, at least one (1) ANTHEM BLUE CROSS-sponsored training seminar each calendar year.

2.14 Gifts or Payments to Induce Enrollment

a. Agent will not use providers to offer anything of value to induce plan enrollees to select them as a provider;

b. Agent will not offer gifts or payment as an inducement to enroll in the organization; c. Agent will not offer cash gifts, including charitable contributions made on behalf of people

attending a marketing presentation, and including gift certificates and gift cards that can be readily converted to cash

ARTICLE III - OBLIGATIONS OF ANTHEM BLUE CROSS

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coverage, Agent shall receive first year and renewal commissions. Such commissions shall be based on the commission schedules attached hereto and shall be paid on net premium charges actually received by ANTHEM BLUE CROSS on applications issued by ANTHEM BLUE CROSS that are produced by the Agent. ANTHEM BLUE CROSS may modify or replace its commission schedule on thirty (30) days prior written notice to Agent, and such modified or replacement schedule shall apply to all other policies effective following the effective date of such modification or replacement.

ANTHEM BLUE CROSS may discontinue or modify the payment of all Commissions should the law require. Any such discontinuance or modification of the payment of Commissions shall be effective as required by the applicable law. ANTHEM BLUE CROSS shall provide notice of such discontinuance as soon as practicable.

The following will only be applicable to Medicare Advantage and/or Part D Contracts:

Notwithstanding the terms set forth in this Agreement or Commission Schedules, the compensation to Agent for Medicare Advantage and/or Part D Products will be in compliance with CMS regulations and/or guidance and with any other laws relating to the marketing and/or sale of such products.

3.2 Renewal Commissions

The following will only be applicable to Individual and Family, Medicare Supplement and Group Contracts:

Renewal commissions shall be payable to Agent by ANTHEM BLUE CROSS as long as all of the following conditions are satisfied:

a. ANTHEM BLUE CROSS retains the policy in force produced by Agent (such retention

being at ANTHEM BLUE CROSS’s option), and b. This Agreement remains in effect, and

c. At least six (6) Individual and/or Medicare Supplement policies or in the case of group at least one (1) small group under ANTHEM BLUE CROSS group contracts written by the Agent, remain in effect, and

d. In the case of small group business, no other Agent is designated in writing as “Agent of Record,” by the employer of the group. For Individual and Family Plans no change in the “Agent of Record” has been requested and accepted by ANTHEM BLUE CROSS pursuant to Section 3.8 of this Agreement.

The following will only be applicable to Medicare Advantage and/or Part D Contracts: Notwithstanding the terms set forth in this Agreement or Commission Schedules, renewal

commissions for Medicare Advantage and/or Part D Products will be paid in compliance with CMS regulations and/or guidance and with any other laws relating to the marketing and/or sale of such products.

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0217CABENABC-CA 1/12 Page 7 of 15 3.3 Assignment Rights

Assignment rights apply only to Individual Enrollment Plan Programs and Medicare Supplement Plan Programs, and commissions on no other programs shall be assignable.

a. If all the following conditions are satisfied, Agent may assign any or all business written under this Agreement to another licensed agent:

i. The assignment must be in writing, permanent and irrevocable, notarized and in a form acceptable to ANTHEM BLUE CROSS, and

ii. The terms of the assignment must be determined by ANTHEM BLUE CROSS not to prejudice the interests of ANTHEM BLUE CROSS, and iii. Under the terms of the assignment, the agent to whom the business is

assigned must expressly agree to assume all Agent’s obligations and responsibilities to ANTHEM BLUE CROSS with respect to the business assigned, and

iv. The loss ratio of Agent’s business in the aggregate, and, in the case of an assignment of only a portion of Agent’s business, the loss ratio of both the portion retained and the portion assigned, must be no worse than ANTHEM BLUE CROSS’s average loss ratio for individual plan business, and

v. The Agent to whom the business would be assigned either has a standard ANTHEM BLUE CROSS Individual Plans Agent Agreement in force and good standing, or is acceptable to ANTHEM BLUE CROSS and qualifies for and enters into a standard Individual Plans Agent Agreement with ANTHEM BLUE CROSS, and

vi. At the time of assignment, at least six (6) individual ANTHEM BLUE CROSS benefit agreements written by Agent are in force in Agent’s book of ANTHEM BLUE CROSS business, and

vii. Except as provided in paragraph 3.4b below, this Agreement is in force and good standing at the time of assignment. Since any agent to whom Agent’s business may be assigned would represent the interests of ANTHEM BLUE CROSS with respect to said business, ANTHEM BLUE CROSS reserves the right to decline to approve, in its sole and absolute discretion, any assignment.

b. Since any agent to whom Agent’s business may be assigned would represent the interests of ANTHEM BLUE CROSS with respect to said business, ANTHEM BLUE CROSS reserves the right to decline to approve, in its sole and absolute discretion, any assignment.

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0217CABENABC-CA 1/12 Page 8 of 15 3.4 Termination Rights

The following will only be applicable to All Contracts:

Subject to the requirements and conditions set forth in the applicable Schedules, commissions shall be payable after termination of the Agreement as follows:

a. Subject to sections 3.2, 3.5b and 3.8 of this Agreement, if this Agreement is terminated without cause, pursuant to Section 1.2, ANTHEM BLUE CROSS shall continue to pay commissions for individual policies/plans subsequent to the date of termination, if at the time of termination and all times thereafter at least six (6) individual and/or Medicare supplement plans/policies written by Agent remain in effect. For group business, ANTHEM BLUE CROSS shall continue to pay commissions if at least one (1) group ANTHEM BLUE CROSS benefit agreement written by Agent remains in effect and no other Agent is designated in writing as Agent of Record by the group.

b. If this Agreement is terminated with cause pursuant to Section 1.3(a), the Beneficiary designated in the Agreement may receive renewal commissions for a period of ten (10) years from the date of the Agent's death if Beneficiary satisfies the requirements of this section. In order to receive payments under this section, Beneficiary must provide proof to ANTHEM BLUE CROSS's satisfaction that Beneficiary has obtained all necessary licenses and is appointed by ANTHEM BLUE CROSS within three (3) months of the Agent's death and maintained such license and appointment throughout the ten (10) years following the Agent’s death. If Beneficiary cannot establish to ANTHEM BLUE CROSS's satisfaction that Beneficiary is both licensed and appointed as set forth in this section, no commissions due to Agent shall be payable to Beneficiary under this section. Any payments under this section shall commence upon Beneficiary establishing the conditions set forth in this section and will expire ten (10) years after Agent's death or upon the Beneficiary’s failure to maintain the necessary licensure or appointment required by this section. Agent understands that the Beneficiary benefit under this section 3.4b applies only to Individual and Family Contracts and Medicare Supplement Plan programs written by Agent, and that commissions for other programs are not transferable upon Agent’s death.

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d. Agent understands that the Beneficiary benefit under section 3.4b applies only to Individual and Family Contracts and Medicare Supplement plan programs written by Agent.

e. Notwithstanding any other provision of this Section 3.4, renewal commissions for Medicare Advantage and/or Part D Products will be paid in compliance with CMS regulations and/or guidance and with any other laws relating to the marketing and/or sale of such products.

f. Agent understands that he has no Termination Rights under this section 3.4 as to any Business assigned to another agent.

3.5 Loss of Renewal Commissions:

a. No further commissions shall be payable to Agent should ANTHEM BLUE CROSS terminate this Agreement for cause under paragraph 1.3.

b. If Agent is receiving commissions pursuant to Termination Rights under 3.4, above, no further commissions shall be payable if:

i. Agent fails to immediately remit to ANTHEM BLUE CROSS any funds received on behalf of ANTHEM BLUE CROSS, or

ii. Agent shall be indebted to ANTHEM BLUE CROSS for more than sixty (60) days, or

iii. Agent induces or attempts to induce any ANTHEM BLUE CROSS member to give up ANTHEM BLUE CROSS coverage or replace an ANTHEM BLUE CROSS benefit agreement with coverage by any other company unless such change is clearly in the best interest of the ANTHEM BLUE CROSS member and does not adversely affect ANTHEM BLUE CROSS’s loss ratio, or iv. Agent purports to act, or represents that he is entitled to act, in any way on

behalf of ANTHEM BLUE CROSS, or

v. Agent commits any act of fraud or dishonesty or breaches any fiduciary duty or does anything which would have been a material breach of this Agreement had this Agreement remained in effect, or

vi. Agent fails to notify ANTHEM BLUE CROSS of any change of Agent’s address within 90 days.

c. The provisions of paragraph 3.5b, above, shall survive termination of this Agreement.

3.6 ANTHEM BLUE CROSS will pay to Agent compensation due within thirty (30) days following the

end of each calendar month based on subscription charges actually received and reconciled by

ANTHEM BLUE CROSS, and either due or received and reconciled by ANTHEM BLUE CROSS,

whichever is later, during the calendar month on Agent-generated business, except that ANTHEM

BLUE CROSS reserves the right to accumulate commissions until commissions due equal at

least $25.00. If a return subscription charge is due on Agent-generated business, ANTHEM BLUE

CROSS will charge back to Agent the amount of commission previously paid to Agent on the

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In the event that an error is made in the calculation and/or payment of commissions under this Agreement, regardless of who made the error or the reason for the error, the parties agree that the correction of the error requiring payments to Agent or recovery of payments from Agent shall be made retroactively for a maximum of twelve (12) months for all policies except Medicare Advantage and/or Part D products, which shall be in accordance with CMS guidelines, from the date the error was discovered by ANTHEM BLUE CROSS. This section shall not limit in any way

ANTHEM BLUE CROSS’s right to collect any indebtedness of Agent to ANTHEM BLUE CROSS

under this section, through offset of commissions or otherwise, as set forth in this Agreement. This section 3.6 shall not be applicable to any refunds due under Section 3.9 of this Agreement. 3.7 Except to the extent responsibility is expressly and explicitly delegated under this Agreement,

ANTHEM BLUE CROSS shall be responsible for, and may exercise its discretion in connection with, all aspects of the underwriting and administration of any ANTHEM BLUE CROSS products including, but not limited to, the following:

a. the design, benefit configuration and rates of such products; and

b. the establishment of underwriting procedures and criteria to be used in the acceptance or rejection of risks; and

c. the establishment and holding of reserves; and d. the payment or denial of claims; and

e. the preparation and issuance of Benefit Agreements and Benefit Certificates. 3.8 The following will only be applicable to Individual and Family Contracts:

ANTHEM BLUE CROSS in its sole and absolute discretion may refuse to appoint any Agent or

do business with any sub-agent of Agent. ANTHEM BLUE CROSS in its sole and absolute discretion may recognize and accept a request for a change of Agent of Record from an Individual Policyholder/Member only after the Individual Policyholder/Member has been effective with ANTHEM BLUE CROSS for twelve (12) consecutive months. After an Individual Policyholder/Member has been effective with ANTHEM BLUE CROSS for twelve (12) consecutive months, ANTHEM BLUE CROSS may, in its sole and absolute discretion, accept a

maximum of one Agent of Record change request from an Individual Policyholder/Member every twelve (12) months.

The following will only be applicable to Medicare Supplement Contracts:

Compensation shall be payable only for so long as the Medicare Plan Policyholder maintains a Policy with ANTHEM BLUE CROSS and Agent remains the "Agent of Record" for the Medicare Plan Policyholder, as recognized by both the Medicare Plan Policyholder and ANTHEM BLUE CROSS.

The following will only be applicable to Medicare Advantage and/or Part D and Specialty Contracts:

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0217CABENABC-CA 1/12 Page 11 of 15 3.9 Refunds.

The following will only be applicable to Individual and Family, Medicare Supplement and Group Contracts:

Upon notice to Agent from ANTHEM BLUE CROSS, Agent shall refund ratably to ANTHEM BLUE CROSS any commissions at the same rate at which commissions were originally paid to Agent on policies/plans that are rescinded, canceled, terminated, subject to a premium refund or retroactive reduction in premiums. Such refunds and reductions in premiums shall include, but not be limited to, refunds required by federal health care reform and any similar state law and shall not be construed as errors or be subject to the time limits set forth in Section 3.6 of this Agreement. Any refunds under this section 3.9 shall constitute a debt of Agent due and owing to ANTHEM BLUE CROSS and upon providing notice to Agent, ANTHEM BLUE CROSS may deduct the refund amount from commissions due or that may become due to AGENT after the date of notice of such request for payment. Notice of premium refunds required by federal health care reform and any similar state law shall be provided by ANTHEM BLUE CROSS to Agent in the manner set forth in section 6.6(d) of this Agreement. Notice of all other refunds under this section 3.9 shall be provided to Agent through commission statements and may be provided to Agent after any refunds are deducuted from commissions that become due and payable to Agent. This section shall not limit in any way ANTHEM BLUE CROSS’s right to collect any indebtedness of Agent to ANTHEM BLUE CROSS under this Agreement, through offset of commissions or otherwise, as set forth in this Agreement.

The following will only be applicable to Medicare Advantage and/or Part D Contracts:

Anthem Blue Cross shall recover commission paid to Agents relating to the sale of Medicare Advantage and Part D plans in accordance with all CMS Guidelines.

ARTICLE IV - DISPUTE RESOLUTION

4.1 ANTHEM BLUE CROSS and Agent agree to meet and confer in good faith on all matters affecting this Agreement. The parties agree that any unresolved dispute will be resolved by binding arbitration in accordance with the Commercial Rules of the American Arbitration Association.

ARTICLE V - INDEMNITY

5.1 Neither ANTHEM BLUE CROSS nor Agent shall be liable to any third party for an act or failure to act of the other party to this Agreement.

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5.3 ANTHEM BLUE CROSS agrees to indemnify and save Agent, including partners, directors, officers and employees of Agent, harmless from any and all liability, losses, damages, costs or expenses arising out of any and every claim, demand, lawsuit or cause of action asserted against Agent by a third party, which claim, demand, lawsuit or cause of action results from or arises in connection with any negligent or otherwise wrongful act or omission of ANTHEM BLUE CROSS, including any breach of this Agreement, or of any director, officer or employee of ANTHEM BLUE CROSS. Such indemnity shall include reasonable attorney fees.

5.4 Should ANTHEM BLUE CROSS and Agent each claim indemnity from the other under paragraphs 5.2 and 5.3 of this ARTICLE V hereof and should it be determined that each is entitled to some indemnity from the other under the terms of said paragraphs, then the amount of indemnity due from each to the other shall be determined according to comparative fault principles.

5.5 The obligations of this ARTICLE V will survive termination of this Agreement as to acts or omissions committed during the term of this Agreement.

ARTICLE VI - GENERAL PROVISIONS

6.1 ANTHEM BLUE CROSS and Agent shall comply with all laws and regulations applicable to their businesses, their licenses and the transactions into which they enter.

6.2 Agent agrees to execute and comply with all of the terms of the Business Associate Agreement attached to and made part of this Agreement. Agent further agrees to execute a revised Business Associate Agreement at any time during the term of this Agreement upon the request of ANTHEM BLUE CROSS.

6.3 Agent agrees that in performing under this Agreement, Agent is acting in a fiduciary capacity to ANTHEM BLUE CROSS. Agent shall act in the best interests of ANTHEM BLUE CROSS. Agent shall not permit other interests, activities or responsibilities to interfere with faithful performance under this Agreement. Agent will not induce, or attempt to induce, the replacement of ANTHEM BLUE CROSS coverage with the coverage of another carrier, if it is not in the best interests of the ANTHEM BLUE CROSS Policyholder/Member.

6.4 Neither this Agreement nor the right to receive money hereunder may be assigned without the

prior written consent of ANTHEM BLUE CROSS, and any assignment made contrary to this provision shall be void as to ANTHEM BLUE CROSS. This Agreement is personal to Agent, and duties hereunder shall not be delegated or subcontracted by Agent. Agent shall not use sub-agents except in strict accordance with section 6.5 below.

6.5 Subject to the following, Agent may use sub-agents in Agent’s performance under this Agreement:

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b. Agent will ensure that any person used by Agent as a sub-agent in performance under this Agreement is properly licensed and fully qualified as necessary to act in such capacity. Agent shall, at Agent’s sole cost and expense, file whatever documents with the California Department of Insurance as are necessary for any sub-agent to lawfully act in that capacity. Furthermore, should ANTHEM BLUE CROSS instruct Agent to discontinue the use of any sub-agent, Agent shall be responsible, at Agent’s sole cost and expense, for filing any documents with the California Department of Insurance as may be required to properly terminate a sub-agent’s authority to so act.

c. Agent shall submit to ANTHEM BLUE CROSS a sub-agent Application for Appointment which form shall be supplied by ANTHEM BLUE CROSS; no other form of application for appointment will be accepted by ANTHEM BLUE CROSS. Agent shall be responsible for the accuracy and completeness of such application submitted and shall ensure that each person for whom such application is submitted shall have read, understood and personally signed such application. Agent shall not, without the express written permission of ANTHEM BLUE CROSS, contract with, engage or otherwise enter into a relationship with sub-agents to sell any Plans/Policies of ANTHEM BLUE CROSS if

ANTHEM BLUE CROSS has previously terminated the appointment or designation of

such sub-agent with ANTHEM BLUE CROSS. ANTHEM BLUE CROSS reserves the right to require Agent to pay appointment and processing fees imposed by ANTHEM BLUE CROSS, if any, for the appointment and any termination of the appointment of such sub-agents.

d. Agent shall be responsible for the payment of any and all compensation, of whatever kind, including, but not limited to, commissions, service fees or expense allowances due to or claimed by any sub-agent. Agent agrees to indemnify, defend and save ANTHEM BLUE CROSS harmless from and against any claim for reimbursement, compensation or other payment made by a sub-agent.

e. Agent shall be responsible for the appropriate training and guidance of sub-agents to the extent that sub-agents are used in the marketing of ANTHEM BLUE CROSS products. Agent shall be responsible to ANTHEM BLUE CROSS for the acts or omissions of sub-agents.

f. Agent agrees that if he is required under this Agreement to procure and maintain a certain level of Errors and Omissions Insurance in a form satisfactory to ANTHEM BLUE CROSS, such requirement shall apply to agents. Agent shall ensure that each sub-agent used in the marketing of ANTHEM BLUE CROSS products procures and maintains any required Errors and Omissions Insurance, or Agent shall include each sub-agent as an additional named insured under Agent’s coverage or otherwise ensure that this requirement is satisfied by each sub-agent used in the marketing of ANTHEM BLUE CROSS products.

6.6 Notice

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0217CABENABC-CA 1/12 Page 14 of 15 Address:

Anthem Blue Cross/Anthem Blue Cross Life and Health Insurance Company P.O. Box 9074

Oxnard, CA 93031-9074 Email Addresses:

[email protected] (Individual and Small Group); and [email protected] (Senior)

Facsimile: 805-713-7191

b. Any notice or demand shall be deemed to have been given as of the date of deposit in the United States mail with postage prepaid or, in the case of delivery other than by mail, on the date of actual delivery at the appropriate address.

c. If either party changes its Address, such party shall change its Address for notice by giving notice of the new Address as provided in this section.

d. Administrative guidelines, bulletins, directives manuals, product updates, rate updates, the notice set forth in Section 3.9 of this Agreement and similar communications shall be published and provided to Agent by ANTHEM BLUE CROSS by posting on the agent web portal at www.anthem.com/ca or other site as designated by ANTHEM BLUE CROSS.

6.7 This Agreement, the Agent Appointment Application, Signature Sheet, Business Associate Agreement, Medicare Advantage and Part D Broker Contract Addendum, the Commission Schedules, any other attachments referenced in the Agreement and any amendments to any of the preceding shall constitute the entire Agreement between the Parties. Subject to ANTHEM BLUE CROSS’s right of modification set out in section 1.2, no modification or amendment to this Agreement shall be effective unless it is in writing, attached to and made a part of this Agreement, and is executed by a duly authorized representative of Agent and by an officer of

ANTHEM BLUE CROSS.

6.8 Agent expressly agrees that this Agreement supersedes any prior agreement(s) between Agent

and ANTHEM BLUE CROSS including business placed by Agent in ANTHEM BLUE CROSS

prior to the effective date of this Agreement. Agent agrees that Agent’s rights to commissions in connection with business placed in ANTHEM BLUE CROSS by Agent prior to the effective date of this Agreement will be determined in accordance with the terms of this Agreement.

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6.10 The fact that ANTHEM BLUE CROSS may not have insisted upon strict compliance with this Agreement with respect to an act or transaction of Agent shall not relieve Agent from the obligation to perform strictly in accordance with the terms of this Agreement with regard to any other act or transaction. ANTHEM BLUE CROSS shall at all times be entitled to expect Agent to perform strictly in accordance with terms of this Agreement. The fact that ANTHEM BLUE CROSS may not have asserted a right under this Agreement shall not be construed to be a waiver of such right nor deny ANTHEM BLUE CROSS the ability to assert or enforce such right at some future date during the term of this Agreement.

Agent Anthem Blue Cross

By: ____________________________________ By: _____________ Printed Name: ___________________________ Printed Name: Mary Floyd________________ Title: __________________________________ Title: Vice President Sales________________ Date: __________________________________ Date: ________________________________

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Broker BA Agreement (Template revised January 2011) Form No: BKR0001

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BUSINESS ASSOCIATE AGREEMENT

This agreement (“Agreement”) is effective on the date executed by Business Associate and is between the Brokerage/Broker/ Agency/Agent named in the execution process of this Agreement (“Business Associate”) and WellPoint, Inc. on behalf of its affiliates* who are Covered Entities or Business Associates and who have a business relationship with Business Associate, if any (hereinafter collectively “Company”). The purpose of this Agreement is to comply with the requirements of the Health Insurance Portability and Accountability Act of 1996 and its implementing regulations (45 C.F.R. Parts 160-64), any applicable state privacy laws, any applicable state security laws, any applicable implementing regulations issued by the Insurance Commissioner or other regulatory authority having jurisdiction and the requirements of the Health Information Technology for Economic and Clinical Health Act, as incorporated in the American Recovery and Reinvestment Act of 2009 (the “HITECH Act”) and any regulations adopted or to be adopted pursuant to the HITECH Act that relate to the obligations of business associates. Business Associate recognizes and agrees it is obligated by law to meet the applicable provisions of the HITECH Act.

All capitalized terms in this Agreement that are not defined in this Agreement will have the meaning ascribed to those terms by 45 C.F.R. Parts 160-164, or applicable insurance regulations that are applicable to Company’s relationship with Business Associate.

A. Privacy of Protected Health Information and Nonpublic Personal Financial Information. 1. Permitted and Required Uses and Disclosures. Business Associate is permitted or required to

Use or disclose Protected Health Information (“PHI”) it requests, creates or receives for or from Company (or another business associate of Company) only as follows:

a) Functions and Activities on Company’s Behalf. Business Associate is permitted to request, Use and disclose PHI it creates or receives for or from Company (or another business associate of Company), consistent with the Privacy Rule and the HITECH Act, only as described in this Agreement, or other agreements during their term that may exist between Company and Business Associate.

b) Business Associate’s Operations. Business Associate may Use PHI it creates or receives for or from Company as necessary for Business Associate’s proper management and administration or to carry out Business Associate’s legal responsibilities. Business Associate may disclose such PHI as necessary for Business Associate’s proper management and administration or to carry out Business Associate’s legal responsibilities only if:

(i) The Disclosure is Required by Law; or

(ii) Business Associate obtains reasonable assurance evidenced by written contract, from any person or organization to which Business Associate will disclose such PHI that the person or organization will:

a. Hold such PHI in confidence and Use or further disclose it only for the purpose for which Business Associate disclosed it to the person or organization or as Required by Law; and

b. Notify Business Associate (who will in turn promptly notify Company) of any instance of which the person or organization becomes aware in which the confidentiality of such PHI was breached.

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d) Minimum Necessary and Limited Data Set. In any instance when Business Associate Uses, requests or discloses PHI under this Agreement or in accordance with other agreements that exist between Company and Business Associate, Business Associate shall utilize a Limited Data Set, if practicable. Otherwise, Business Associate may Use or disclose only the minimum amount of PHI necessary to accomplish the intended purpose, except that Business Associate will not be obligated to comply with this minimum necessary limitation with respect to:

(i) Disclosure to or request by a Health Care Provider for Treatment;

(ii) Use for or Disclosure to an Individual who is the subject of Company’s PHI, or that Individual’s Personal Representative;

(iii) Use or Disclosure made pursuant to an authorization compliant with 45 C.F.R. §164.508 that is signed by an Individual who is the subject of Company’s PHI to be used or disclosed, or by that Individual’s Personal Representative;

(iv) Disclosure to the United States Department of Health and Human Services (“HHS”) in accordance with Section C(5) of this Agreement;

(v) Use or Disclosure that is Required by Law; or

(vi) Any other Use or Disclosure that is excepted from the Minimum Necessary limitation as specified in 45 C.F.R. §164.502(b)(2).

e) Use by Workforce. Business Associate shall advise members of its workforce of their obligations to protect and safeguard PHI. Business Associate shall take appropriate disciplinary action against any member of its workforce who uses or discloses PHI in contravention of this Agreement.

2. Prohibitions on Unauthorized Requests, Use or Disclosure.

a) Business Associate will neither Use nor disclose Company’s PHI it creates or receives from Company or from another Business Associate of Company, except as permitted or required by this Agreement or as Required by Law or as otherwise permitted in writing by Company. This Agreement does not authorize Business Associate to request, Use, disclose, maintain or transmit PHI in a manner that will violate 45 C.F.R. Parts 160-164.

b) Business Associate will not develop any list, description or other grouping of Individuals using PHI received from or on behalf of Company, except as permitted by this Agreement or in writing by Company. Business Associate will not request, Use or disclose any list, description or other grouping of Individuals that is derived using such PHI, except as permitted by this Agreement or in writing by Company.

3. Sub-Contractors and Agents. Business Associate will require any of its subcontractors and agents to provide reasonable assurance, evidenced by written contract, that subcontractor or agent will comply with the same privacy and security obligations as Business Associate with respect to such PHI, including the obligations described in Section 4 herein.

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1. Maintain a privacy policy and procedure for Business Associate’s organization, which must identify an officer of the organization that is responsible for enforcement.

2. All employees of Business Associate that handle or access PHI must undergo ongoing training regarding the safeguarding of PHI.

3. Ensure that any third party that Business Associate contracts with or relies upon for the provision of services to WellPoint also maintains a framework for compliance with the HIPAA Privacy and Security rules.

4. Implement a contingency plan for responding to emergencies and/or disruptions in your business, to ensure, to the extent reasonable, that services provided to WellPoint are not interrupted and the integrity and safety of all PHI is maintained.

5. Establish and implement a data back up program that ensures Business Associates’ ability to provide Company with retrievable, exact copies of PHI, upon Company’s request.

6. Maintain and exercise an audit plan to respond to internal and external security threats and violations. The audit plan should document the scope and frequency of audits and the audit procedure.

7. Document how security breaches that are discovered will be addressed.

8. Maintain technology policies and procedures that ensure the protection of PHI on hardware and software utilized by Business Associate.

9. Maintain all PHI received or created in paper form in a secure location with restricted access. 10. Utilize encryption for the electronic transmission of PHI to Company and/or to any other third

party, as directed by Company or as required for the provision of services to Company.

11. To the extent that Business Associate stores, processes and/or transmits cardholder data (e.g., credit card numbers and other related information, as such term is defined by the Payment Card Industry, (PCI) Data Security Standards), Business Associate shall comply with all PCI Data Security Standards.

Business Associate shall provide Company with information concerning the aforementioned safeguards and/or other information security practices as they pertain to the protection of Company’s PHI, as Company may from time to time request. Upon reasonable advance request, Business Associate shall provide WellPoint access to Business Associate’s facilities used for the maintenance or processing of PHI, and to its books, records, practices, policies and procedures concerning the Use and Disclosure of PHI, in order to determine Business Associate’s compliance with this Agreement.

B. PHI Access, Amendment and Disclosure Accounting.

1. Access. Business Associate will promptly upon Company’s request make available to Company or, at Company’s direction, to the Individual (or the Individual’s Personal Representative) for inspection and obtaining copies any PHI about the Individual which Business Associate created or received for or from Company and that is in Business Associate’s custody or control, so that Company may meet its access obligations pursuant to and required by applicable law, including but not limited to 45 C.F.R. 164.524, and where applicable, the HITECH Act. Business Associate shall make such information available in electronic format where directed by the organization.

2. Amendment. Business Associate will, upon receipt of notice from Company, promptly amend or permit Company access to amend any portion of the PHI which Business Associate created or received for or from Company, pursuant to and required by applicable law, including but not limited to 45 C.F.R. Part 164.526.

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3. Disclosure Accounting. So that Company may meet its Disclosure accounting obligations pursuant to and required by applicable law, including but not limited to 45 C.F.R. Part 164.528: a) Disclosure Tracking. Business Associate will promptly, but no later than within seven (7) days

of the Disclosure, report to Company for each Disclosure, not excepted from Disclosure accounting under Section B.3(b) below, that Business Associate makes to Company or a third party of PHI that Business Associate creates or receives for or from Company, (i) the Disclosure date, (ii) the name and (if known) address of the person or entity to whom Business Associate made the Disclosure, (iii) a brief description of the PHI disclosed, and (iv) a brief statement of the purpose of the Disclosure (items i-iv,collectively, the “disclosure information”). For repetitive Disclosures Business Associate makes to the same person or entity (including Company) for a single purpose, Business Associate may provide (x) the disclosure information for the first of these repetitive Disclosures, (y) the frequency, periodicity or number of these repetitive Disclosures and (z) the date of the last of these repetitive Disclosures. Business Associate further shall provide any additional information, to the extent required by the HITECH Act or any regulation adopted pursuant thereto.

b) Exceptions from Disclosure Tracking. Business Associate need not report Disclosure of information or otherwise account for Disclosures of PHI that this Agreement or Company in writing permits or requires (i) for the purpose of Company’s Treatment activities, Payment activities, or Health Care Operations (except where such recording or accounting is required by the HITECH Act), and as of the effective dates for any such requirements, (ii) to the Individual who is the subject of the PHI disclosed, to that Individual’s Personal Representative or to another person or entity authorized by the Individual (iii) to persons involved in that Individual’s Health Care or Payment for Health Care; (iv) for notification for disaster relief purposes, (v) for national security or intelligence purposes, (vi) to Law Enforcement Officials or Correctional Institutions regarding Inmates; or (vii) disclosed in a limited data set.

Business Associate need not report any Disclosure of PHI that was made before April 14, 2003. c) Except as provided below in subsection d) below, Business Associate will not respond directly to an Individual’s request for an accounting of Disclosures. Business Associate will refer the Individual to Company so that Company can coordinate and prepare a timely accounting to the Individual.

d) Disclosure through an Electronic Health Record. However, when Business Associate is contacted directly by an individual based on information provided to the individual by Company, Business Associate shall make the accounting of disclosures available directly to the individual, but only if required by the HITECH Act or any related regulations.

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5. Disclosure to U.S. Department of Health and Human Services. Business Associate shall make its internal practices, books, and records relating to the Use and Disclosure of PHI received from Company (or created or received by Business Associate on behalf of Company) available to the Secretary of the United States Department of Health and Human Services, for purposes of determining Company’s compliance with 45 C.F.R. Parts 160-164. Unless the Secretary directs otherwise, Business Associate shall promptly notify Company of Business Associate’s receipt of such request, so that Company can assist in compliance with that request.

C. Breach of Privacy and Security Obligations.

1. Reporting. Business Associate will report to Company: (i) any Use or Disclosure of PHI (including Security Incidents) not permitted by this Agreement or in writing by Company;(ii) any Security Incident; (iii) any Breach, as defined in the HITECH Act; or (iv) any other breach of a security system, or the like, as such may be defined under applicable state law (collectively a “Breach”). Except as described in subparagraph “e)” below, Business Associate will, without unreasonable delay, but no later than within one business day after Business Associate’s discovery of a Breach, make the report by sending a report to Business Associate’s assigned service support unit or by such other reasonable means of reporting as may be communicated to Business Associate by Company, after Business Associate discovers such Breach. Business Associate shall cooperate with Company in investigating the Breach and in meeting Company’s obligations under the HITECH Act, and any other security breach notification laws or regulatory obligations.

a) Report Contents. To the extent such information is available Business Associate’s report will at least:

(i) Identify the nature of the non-permitted or prohibited access, Use or Disclosure, including the date of the Breach and the date of discovery of the Breach;

(ii) Identify the PHI accessed, used or disclosed, and provide an exact copy or replication of the PHI, as appropriate, in a format reasonably requested by Company, and to the extent available;

(iii) Identify who caused the Breach and who received the PHI;

(iv) Identify what corrective action Business Associate took or will take to prevent further Breaches;

(v) Identify what Business Associate did or will do to mitigate any deleterious effect of the Breach; and

(vi) Provide such other information, including a written report, as Company may reasonably request.

b) Examples of Security Incidents. Company requires prompt notification from Business Associate if Business Associate experiences any Security Incidents that impact the confidentiality, integrity or availability of Company data or information systems. Below are some examples: (i) Business Associate’s information systems are exposed to malicious code, such as a

virus or worm, and such code could be transmitted to Company data or systems. (ii) Unauthorized access is granted or obtained to servers or workstations that contain

Company data or Business Associate discovers that Company data is being used, copied, or destroyed inappropriately.

(iii) Business Associate experiences an attack or the compromise of a server or workstation containing Company information requiring that it be taken offline.

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c) Unsuccessful Security Incidents. Except as noted in C. 1 (e) below, the parties acknowledge and agree that this section constitutes notice by Business Associate to Company of the ongoing existence and occurrence of attempted but Unsuccessful Security Incidents (as defined below) for which no additional notice to Company shall be required. “Unsuccessful Security Incidents” shall include, but not be limited to, pings and other broadcast attacks on Business Associate’s firewall, port scans, unsuccessful log-on attempts, denials of service and any combination of the above, so long as no such incident results in unauthorized access, use or disclosure of PHI.

d) Breach of Unsecured Protected Health Information. A Breach of Unsecured Protected Health Information includes any Breach as defined in the HITECH act or regulations adopted pursuant thereto.

e) Medicare Vendor Reporting Requirements –To the extent that Business Associate is subject to any Center for Medicare and Medicaid (“CMS”) incident reporting requirements (including applicable timeframes for such reporting) as detailed in the services agreement between Company and Business Associate (including any amendments, exhibits or addenda), Business Associate shall comply with all such reporting requirements, in addition to those imposed hereby.

2. Breach. Without limiting the rights of the parties elsewhere set forth in the Agreement or available under applicable law, if Business Associate breaches its obligations under this Agreement, Company may, at its option:

a) Exercise any of its rights of access and inspection under paragraph 4 of section A of this Agreement

b) Require Business Associate to submit to a plan of monitoring and reporting, as Company may determine appropriate to maintain compliance with this Agreement and Company shall retain the right to report to the Secretary of HHS any failure by Business Associate to comply with such monitoring and reporting; or

c) Immediately and unilaterally, terminate the Agreement, without penalty to Company or recourse to Business Associate, and with or without an opportunity to cure the breach. Company’s remedies under this Section and set forth elsewhere in this Agreement or in any other agreement between the parties shall be cumulative, and the exercise of any remedy shall not preclude the exercise of any other. If for any reason Company determines that Business Associate has breached the terms of this Agreement and such breach has not been cured, but Company determines that termination of the Agreement is not feasible, Organization may report such breach to the U.S. Department of Health and Human Services.

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7 of 11 D. Compliance with Standard Transactions.

1. If Business Associate conducts in whole or part Standard Transactions, for or on behalf of Company, Business Associate will comply, and will require any subcontractor or agent involved with the conduct of such Standard Transactions to comply, with each applicable requirement of 45 C.F.R. Part 162 for which HHS has established Standards. Business Associate will comply by a mutually agreed date, but no later than the date for compliance with all applicable final regulations, and will require any subcontractor or agent involved with the conduct of such Standard Transactions, to comply, with each applicable requirement of the Transaction Rule 45 C.F. R. Part 162. Business Associate agrees to demonstrate compliance with the Transactions by allowing Company to test the Transactions and content requirements upon a mutually agreeable date. Business Associate will not enter into, or permit its subcontractors or agents to enter into, any trading partner agreement in connection with the conduct of Standard Transactions for or on behalf of Company that:

a) Changes the definition, data condition or use of a data element or segment in a Standard Transaction.

b) Adds any data elements or segments to the maximum defined data set;

c) Uses any code or data element that is marked “not used” in the Standard Transaction’s Implementation Specification or is not in the Standard Transaction’s Implementation Specification; or

d) Changes the meaning or intent of the Standard Transaction’s Implementation Specification.

2. Concurrence for Test Modification to Standard Transactions. Business Associate agrees and understands that there exists the possibility that Company or others may request from HHS an exception from the uses of a Standard in the HHS Transaction Standards. If this request is granted by HHS, Business Associate agrees that it will participate in such test modification.

3. Incorporation of Modifications to Standard Transactions Business Associate agrees and understands that from time-to-time, HHS may modify and set compliance dates for the Transaction Standards. Business Associate agrees to incorporate by reference into this Agreement any such modifications or changes.

4. Code Set Retention (Only for Plans). Both parties understand and agree to keep open code sets being processed or used in the Agreement for at least the current billing period or any appeal period, whichever is longer.

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8 of 11 E. Obligations upon Termination.

1. Return or Destruction. Upon termination, cancellation, expiration or other conclusion of the Agreement, Business Associate will if feasible return to Company or destroy all PHI, in whatever form or medium (including in any electronic medium under Business Associate’s custody or control), that Business Associate created or received for or from Company, including all copies of and any data or compilations derived from and allowing identification of any Individual who is a subject of the PHI. Business Associate will complete such return or destruction as promptly as possible, but not later than 30 days after the effective date of the termination, cancellation, expiration or other conclusion of Agreement. Business Associate will identify any PHI that Business Associate created or received for or from Company that cannot feasibly be returned to Company or destroyed, and will limit its further Use or Disclosure of that PHI to those purposes that make return or destruction of that PHI infeasible and will otherwise continue to protect the security any PHI that is maintained pursuant to the security provisions of this Agreement for so long as the PHI is maintained. Within such 30 days, Business Associate will certify in writing to Company that such return or destruction has been completed, will deliver to Company the identification of any PHI for which return or destruction is infeasible and, for that PHI, will certify that it will only Use or disclose such PHI for those purposes that make return or destruction infeasible.

2. Continuing Privacy and Security Obligation. Business Associate’s obligation to protect the privacy and security of the PHI it created or received for or from Company will be continuous and survive termination, cancellation, expiration or other conclusion of this Agreement, so long as the data is maintained.

F. General Provisions.

1. Definitions. The capitalized terms in this Agreement have the meanings set out in 45 C.F.R. Parts 160-164, as it may be amended from time to time. As of the execution date of this Agreement, the following are some of the relevant definitions set out in the Code of Federal Regulations.

a) Disclosure means the release, transfer, provision of, access to, or divulging in any other manner of information outside the entity holding the information.

b) Electronic Media means (1) Electronic storage media including memory devices in computers (hard drives) and any removable/transportable digital memory medium, such as magnetic tape or disk, optical disk, or digital memory card; or (2) Transmission media used to exchange information already in electronic storage media. Transmission media include, for example, the internet (wide-open), extranet (using internet technology to link a business with information accessible only to collaborating parties), leased lines, dial-up lines. Private networks, and the physical movement of removable/transportable electronic storage media. Certain transmissions, including of paper, via facsimile, and of voice, via telephone, are not considered transmissions via electronic media, because the information being exchanged did not exist in electronic form before the transmission.

c) Individual means the person who is the subject of Protected Health Information.

d) Individually Identifiable Health Information means information that is a subset of Protected Health Information, including demographic information collected from an Individual; and:

(i) is created or received by a Health Care Provider, Health Plan, Employer, or Health Care Clearinghouse; and