NORTH MISSISSIPPI HEALTH LINK, INC.

MANAGED CARE PROGRAMS

PRACTITIONER AMENDED AND RESTATED

STATEMENT OF POLICIES AND PROCEDURES ON APPOINTMENT, REAPPOINTMENT AND

CLINICAL PRIVILEGES

TABLE OF CONTENTS

PAGE ARTICLE 1. DEFINITIONS.............................................................................................. 1 ARTICLE 2. QUALIFICATIONS FOR PARTICIPATION ............................................. 4

Section 2.1. General.................................................................................................... 4 Section 2.2. Specific Practitioner Qualifications. ....................................................... 4 Section 2.3. No Entitlement to Appointment.............................................................. 5 Section 2.4. Information. ............................................................................................ 5 Section 2.5. Submission of Application...................................................................... 7 Section 2.6. Undertakings. .......................................................................................... 8 Section 2.7. Burden of Providing Information............................................................ 9 Section 2.8. Authorization to Obtain Information. ..................................................... 9 Section 2.9. Credentials Committee Procedure for Appointment............................. 12 Section 2.10. Credentials Committee Report. ............................................................ 12 Section 2.11. Delay of Credentials Committee’s Report. .......................................... 12 Section 2.12. Subsequent Action on the Physician Application. ............................... 13 Section 2.13. Subsequent Action on the Non-physician Application. ....................... 13 Section 2.14. Recredentialing Participating Practitioners. ......................................... 13 Section 2.15. Factors to Be Considered...................................................................... 14 Section 2.16. Credentials Committee Procedure for Reappointment......................... 15

ARTICLE 3. PROCEDURE FOR INVESTIGATION OF MANAGED CARE PROGRAM APPOINTEES.............................................................................................. 17

Section 3.1. Grounds for Action. .............................................................................. 17 Section 3.2. Investigative Procedure......................................................................... 18 Section 3.3. Procedure after Investigation or after Receiving Request for Investigation. 19 Section 3.4. Suspension of Privileges. ...................................................................... 20

ARTICLE 4. SUMMARY SUSPENSION OF APPOINTMENT PRIVILEGES............ 20

Section 4.1. Grounds for Summary Suspension. ...................................................... 20 Section 4.2. Credentials Committee Procedure. ....................................................... 21 Section 4.3. Care of Suspended Individual’s Patients. ............................................. 21

ARTICLE 5. PHYSICIAN HEARING WITH RESPECT TO CREDENTIALS COMMITTEE’S RECOMMENDATION........................................................................ 21

Section 5.1. Initiation of Hearing.............................................................................. 21 Section 5.2. Notice of Recommendation. ................................................................. 21 Section 5.3. Grounds for Hearing. ............................................................................ 23 Section 5.4. Unappealable Actions. .......................................................................... 23

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Section 5.5. Notice of Hearing and Statement of Reasons. ...................................... 23 Section 5.6. List of Witnesses................................................................................... 24 Section 5.7. Hearing Officer(s)................................................................................. 24 Section 5.8. Failure to Appear. ................................................................................. 24 Section 5.9. Postponements and Extensions. ............................................................ 24 Section 5.10. Representation. ..................................................................................... 25 Section 5.11. Admissibility of Evidence. ................................................................... 25 Section 5.12. Official Notice. ..................................................................................... 25 Section 5.13. Basis of Decision.................................................................................. 25 Section 5.14. Burden of Proof. ................................................................................... 26 Section 5.15. Adjournment and Conclusion............................................................... 26 Section 5.16. Deliberations and Recommendations of the Hearing Officer(s). ......... 26 Section 5.17. Disposition of Report of Hearing Officer(s). ....................................... 26 Section 5.18. Action by the Managed Care Board. .................................................... 27 Section 5.19. Action by the Corporate Board............................................................. 27

ARTICLE 6. PHYSICIAN HEARING WITH RESPECT TO PROPOSED MANAGED CARE BOARD OR CORPORATE BOARD ACTION .................................................. 27

Section 6.1. Initiation of Hearing.............................................................................. 27 Section 6.2. Notice of Proposed Action.................................................................... 28 Section 6.3. Grounds for Hearing. ............................................................................ 29 Section 6.4. Unappealable Actions. .......................................................................... 29 Section 6.5. Notice of Hearing and Statement of Reasons. ...................................... 30 Section 6.6. List of Witnesses................................................................................... 30 Section 6.7. Hearing Officer(s)................................................................................. 30 Section 6.8. Failure to Appear. ................................................................................. 31 Section 6.9. Postponements and Extensions. ............................................................ 31 Section 6.10. Representation. ..................................................................................... 31 Section 6.11. Admissibility of Evidence. ................................................................... 31 Section 6.12. Official Notice. ..................................................................................... 31 Section 6.13. Basis of Decision.................................................................................. 32 Section 6.14. Burden of Proof. ................................................................................... 32 Section 6.15. Adjournment and Conclusion............................................................... 32 Section 6.16. Deliberations and Recommendations of the Hearing Officer(s). ......... 33 Section 6.17. Disposition of Report of Hearing Officer(s). ....................................... 33 Section 6.18. Action by the Corporate Board............................................................. 33

ARTICLE 7. DENIAL, TERMINATION OR SUSPENSION OF NON-PHYSICIAN PRACTITIONER’S APPOINTMENT OR CLINICAL PRIVILEGES........................... 33

Section 7.1. Grounds for Automatic Denial, Termination, or Suspension. .............. 33 Section 7.2. Procedural Rights for Denial, Restriction or Termination of Clinical Privileges................................................................................. 34 Section 7.3. Grounds for Appeal............................................................................... 34

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Section 7.4. Appeals Process. ................................................................................... 34 Section 7.5. Action by the Corporate Board. ............................................................ 34

ARTICLE 8. EFFECT OF ADVERSE ACTION............................................................. 35 ARTICLE 9. EFFECT OF APPOINTMENT OR REAPPOINTMENT.......................... 35 ARTICLE 10. NOTICES.................................................................................................. 35

Section 10.1. Form and Delivery. ........................................................................... 35 Section 10.2. Waiver............................................................................................... 36

ARTICLE 11. AMENDMENTS ...................................................................................... 36 ARTICLE 12. ADOPTION .............................................................................................. 35

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ARTICLE 1. DEFINITIONS

The definitions apply to Health Link® documents, collectively known as the Health Link® Amended and Restated By-laws, which include: North Mississippi Health Link, Inc. Managed Care Programs Amended and Restated By-laws, Practitioner Amended and Restated Statement of Policies and Procedures on Appointment, Reappointment and Clinical Privileges, Provider Statement of Policies and Procedures on Appointment and Reappointment, and the Amended and Restated Delineation of Clinical Privileges Policy.

(1) “ABMS” shall mean the American Board of Medical Specialties;

(2) “ACGME” shall mean the Accrediting Council for Graduate Medical Education;

(3) “ADA” shall mean the American Dental Association;

(4) “Administrator” shall mean the President of North Mississippi Health Link, Inc. or his/her delegate, i.e., Vice President or Director;

(5) “AOA” shall mean the American Osteopathic Association;

(6) “AOB” shall mean the American Osteopathic Board of (Specialty);

(7) “authorized representative” shall mean the Provider’s representative or designee who is legally authorized to represent the Provider in the completion of the Provider’s Application, provide other required information and execute other legal documents on behalf of the Provider;

(8) “applicant” shall mean a Practitioner or a Provider or a Provider’s authorized representative applying to become a participant in Health Link® Preferred Provider Organization or any other managed care program operated by North Mississippi Health Link, Inc;

(9) “approved fellowship” shall mean a fellowship training program approved or recognized by the ABMS or the AOB of (Specialty);

(10) “approved residency training program” shall mean a residency training program approved or recognized by the ABMS or AOB of (Specialty);

(11) “board candidate” shall mean a physician who has committed his or her credentials to the ABMS or the AOB of (Specialty), has been accepted to

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the ABMS member board or the AOB of (Specialty) and has received notice of the date and time of the board examination;

(12) “board certified” shall mean that a physician has successfully completed certain published education and training requirements in a Specialty board program officially recognized by the ABMS and the American Medical Association or the American Osteopathic Association and the AOB of (Specialty) and has passed the required board certification;

(13) “Corporate Board” shall mean the Board of Directors of North Mississippi Health Link, Inc;

(14) “Corporation” shall mean North Mississippi Health Link, Inc;

(15) “dentist” shall mean a person who has received a degree from a school accredited by the ADA Commission on Dental Accreditation and is licensed to practice dentistry by a state board of dental examiners;

(16) “enrollee” shall mean an employee, or dependent of an employee, who is eligible to receive health care services in accordance with an employer group contract that specifies the scope of health care services to be delivered under the managed care program;

(17) “licensure” shall mean a process by which a constituted authority or agency grants authorization to engage in a profession or a business after meeting the prerequisite requirements as defined by state or federal regulations;

(18) “Managed Care Board” shall mean the Board of Directors of the managed care programs;

(19) “managed care program(s)” shall include Health Link® PPO and any other managed care programs operated by the Corporation;

(20) “Medical Director” shall mean the Medical Director of the managed care programs operated by the Corporation who shall serve in such capacity pursuant to a written contract;

(21) “must or shall” means an imperative need and/or duty; an essential or indispensable item; mandatory;

(22) “Non-physician Practitioner” shall mean an individual other than a physician, dentist, or oral surgeon who is specialty trained and licensed by the state to provide health care services and patient care either with the

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direct supervision or under the direction of a physician or, if allowed by licensure, an independent practitioner;

(23) “participating Practitioner” shall mean a licensed health care professional who has agreed to and has been accepted by North Mississippi Health Link, Inc. to provide health care services to enrollees;

(24) “participating Provider” shall mean a licensed hospital, surgery center, other facility or an equipment supply company which provides health care services and has been accepted by North Mississippi Health Link, Inc. to provide health care services to enrollees and whose authorized representative has agreed to the terms for participation set forth by North Mississippi Health Link, Inc.;

(25) “physicians” shall mean doctors licensed to practice allopathic or osteopathic medicine;

(26) “PPO” shall mean the Preferred Provider Organization operated by the Corporation;

(27) “Practitioner” shall mean a physician, dentist, or an independent licensed health care professional;

(28) “Provider” shall mean a licensed hospital, surgery center, other facility or an equipment supply company which is licensed by the state as a facility or company for the provision of health care services;

(29) “Residency” shall mean training in a medical specialty in a program approved or recognized by the ABMS or the AOB of (Specialty) at the time the physician completes the training; any physician requesting clinical privileges must have satisfactorily completed the residency training program;

(30) “Service Agreement” shall mean a written and signed binding agreement between North Mississippi Health Link, Inc. and a Practitioner or a Provider;

(31) “Subscriber” shall mean an employer or other organization acceptable to the managed care program which enters into an agreement with the managed care program for the provision of health care services to its employees and their dependents.

Words used in this policy shall be read as the masculine or feminine gender, and as singular or plural, as the content requires. The captions or headings are for convenience

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only and are not intended to limit or define the scope or effect of any provision of this policy.

ARTICLE 2. QUALIFICATIONS FOR PARTICIPATION

Section 2.1. General. Participation in the managed care programs is a privilege which is extended only to professionally competent Practitioners who continuously meet the qualifications, standards and requirements set forth from time to time by the Managed Care Board and approved by the Corporate Board. Participation in the managed care programs is not a matter of right and shall not necessarily be extended to all professionally competent individuals. Participation in the managed care programs may be denied to a qualified individual by the Corporate Board based upon the needs of the managed care programs and other factors as determined from time to time by the Corporate Board in its sole discretion.

Section 2.2. Specific Practitioner Qualifications. Only Practitioners who satisfy the following requirements shall be eligible to participate in the managed care programs:

(a) Are licensed to practice in the state(s) in which such Practitioners will provide medical services to enrollees;

(b) Have provided proof of professional liability insurance coverage issued by an insurance carrier acceptable to the Corporate Board in a coverage amount not less than One Million Dollars ($1,000,000) per occurrence/Three Million Dollars ($3,000,000) aggregate unless the Practitioner is employed by an entity that is governed by state or federal law and then the requirement is determined by the legislative governing agency;

(c) Have provided the managed care program with a list of pending and past professional liability (malpractice) suits and decisions in which the applicant was involved;

(d) Have provided the managed care program with a copy of board certification and/or status, if any;

(e) At the discretion of the Administrator, the Managed Care Board, the Credentials Committee or the Medical Director, a managed care program representative has completed an evaluation form regarding the Practitioner’s office or clinic assessing the Practitioner’s compliance with practice standards, including but

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not limited to, universal precautions, handicapped access and patient medical records and confidentiality;

(f) Can document their:

(1) Background, experience, training and demonstrated competence in the Practitioner’s field of training;

(2) Adherence to the ethics of their profession;

(3) Good reputation and character;

(4) Demonstrated intent of providing high quality, cost-effective health care; and

(5) Ability to work harmoniously with others in a manner satisfactory to the Managed Care Board or the Corporate Board such that all patients treated by the Practitioner under the managed care program will receive quality care, and that the managed care program and the Practitioner will be able to work together in an orderly manner.

Failure of the Practitioner to provide the requested information will deem the application incomplete.

Section 2.3. No Entitlement to Appointment. No Practitioner shall be entitled to participation in the managed care program merely by virtue of the fact that such individual meets the credentialing criteria set forth in this policy. As stated in Section 2.1, participation in the managed care program may be denied to a qualified individual by the Corporate Board based upon the needs analysis of the managed care program and other factors as determined by the Managed Care Board or the Corporate Board.

Section 2.4. Information. Applications for appointment to the managed care program shall be in writing and shall be submitted on forms required by law and/or approved by the Managed Care Board and the Corporate Board. Such forms may be obtained from the Administrator. The application shall require detailed information concerning the applicant’s professional qualifications, including:

(a) Names of at least two (2) Practitioners who have had experience in observing or working with the applicant and who can provide adequate information pertaining to the applicant’s professional competence and character. Such references may not be associated or about to become associated with the applicant in professional practice or personally related to the applicant, and at least one (1)

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reference shall be from the same specialty area as the applicant. However, in the event that the references which meet the requirements of the preceding sentence are not readily available, the Credentials Committee in its sole and absolute discretion may waive or modify such requirements and in such case shall base its review upon such information as it deems appropriate;

(b) The location of offices and the names and addresses of other Practitioners with whom the applying Practitioner is associated and recent practice experience, availability, office hours and after hours coverage;

(c) Information on professional liability claims history, experience and litigation, and a certificate from the present professional liability insurance carrier stating the name of the company, the amount and classification of coverage, that the policy is in full force and effect and the carrier’s agreement to notify the managed care program of any changes in coverage;

(d) Information including documentation regarding investigations, limitations or sanctions of any kind imposed by any health care institution, professional health care society, licensing authority, or Centers for Medicare and Medicaid Services, the Office of Inspector General and any complaints of which the Practitioner has knowledge filed with such institutions, societies or authorities;

(e) Information as to whether the applicant’s medical staff appointments or clinical privileges have ever been relinquished, denied, revoked, suspended, reduced, subjected to probation or investigation or not renewed at any hospital, health care facility or managed care health plan;

(f) Information as to whether the applicant has ever withdrawn his/her application for appointment, reappointment and clinical privileges or resigned from the medical staff of any hospital, health care facility or managed care health plan before a final decision was made by the hospital’s, health care facility’s or managed care health plan’s governing board;

(g) Information as to whether the applicant’s membership in local, state or national professional societies, or license to practice the medical profession in any state, or Drug Enforcement Administration (“DEA”) license has ever been suspended, modified or terminated. The submitted application should include

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a copy of all the applicant’s current licenses to practice, as well as a copy of his/her DEA license, if applicable, professional school diplomas and certificates from all postgraduate training programs completed;

(h) The applicant’s compliance with continuing education requirements as may be imposed by law or applicable accreditation agencies;

(i) An unrestricted consent to the release of professional liability claims information requested by Health Link, Inc., either present or past;

(j) Information as to the applicant’s physical and mental ability to perform requested professional activities;

(k) Information as to whether the applicant has ever been named as a defendant in a criminal action and details about any such instance;

(l) The applicant’s curriculum vitae or chronological work history covering the past five (5) years, and an explanation of any interruptions in this work history exceeding six months;

(m) Results from a query of the National Practitioner Data Bank, the Health Integrity Protection Data Bank and the Office of Inspector General;

(n) The applicant’s signature; and

(o) Any such other information, in addition to that required in the application, if additional information is desired by the Credentials Committee, the Managed Care Board or the Corporate Board.

Section 2.5. Submission of Application. The application for participation in the managed care program shall be submitted by the applicant to the Administrator. It must be accompanied by payment of such processing fees as may be established by the Corporate Board. After receiving references and other information or materials deemed pertinent, the Administrator shall determine the application to be complete and transmit the application and all supporting materials to the Credentials Committee for evaluation. An application shall be deemed incomplete if the need arises for new, additional or clarifying information at any time during the evaluation. It is the responsibility of the applicant to provide a complete application, including adequate responses from references, if applicable. An incomplete application will not be processed. If the application is not complete within one hundred eighty (180) days from the date of the

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signature on the application, the application shall be returned to the applicant with notification that his/her application is no longer being considered by the managed care program. A record shall be kept of all returned applications with the reason for return.

Section 2.6. Undertakings. The following undertakings shall apply to every applicant seeking appointment or reappointment to the managed care program as a condition of consideration of such application and as a condition of continued appointment if granted:

(a) Execution of a participation agreement that upon appointment or reappointment to the managed care program, the Practitioner or the Practitioner’s employer shall agree to:

(1) participate as a provider of health care services in the managed care program;

(2) provide continuous care and supervision to all enrollees in the managed care program for whom the individual has responsibility;

(3) abide by all policies of the managed care program, including all bylaws,

(4) policies and rules and regulations as shall be in force from time to time during the time the individual is appointed to the managed care program;

(5) provide the managed care program with new or updated information, as it occurs, that is pertinent to any question on the application form;

(b) A statement that the applicant has received and had an opportunity to read a copy of the bylaws, policies and rules and regulations as are in force at the time his/her application is processed and all amendments or revisions thereto adopted from time to time, and that the applicant has agreed to be bound by the terms thereof in all matters relating to consideration of his/her application without regard to whether or not he/she is granted appointment to the managed care program;

(c) A statement of the applicant’s willingness to appear for personal interviews in regard to his/her application;

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(d) A statement that any material misrepresentation or misstatement in or omission from the application, if not corrected upon notification, whether intentional or not, shall constitute cause for automatic and immediate rejection of the application resulting in denial of appointment without a right to a hearing or an appeal under Article 5, 6 or 7, and a statement that an appointment granted prior to the discovery of such misrepresentation, misstatement or omission, if not corrected upon notification, may result in summary dismissal from the managed care program without a right to a hearing or an appeal under Article 5, 6 or 7 in the sole discretion of the Corporate Board;

(e) An agreement that the applicant will abide by generally recognized principles of medical ethics and the professional standards of care of the medical profession and that the applicant will render health services to enrollees in the same manner, in accordance with the same standards and within the same time availability as those services are offered to other private patients, consistent with existing medical, ethical and legal requirements for providing continuity of care to any patient; and

(f) An agreement that the Practitioner or the Practitioner’s practice shall notify affected enrollees of the termination of a Practitioner from the practice site.

Each applicant for appointment and reappointment shall sign a statement specifically agreeing to these undertakings as part of the application.

Section 2.7. Burden of Providing Information. The applicant shall have the burden of producing adequate information for a proper evaluation of his/her competence, character, ethics and other qualifications, and of resolving any doubts about such qualifications. The applicant shall have the burden of providing evidence that all the statements made and information given on the application are true and correct. Until the applicant has provided all information requested by the managed care program, the application for appointment or reappointment will be deemed incomplete and will not be processed. Should an incident occur during the course of an appointment year, the appointee has the burden to provide information about such an incident sufficient for the Credentials Committee’s review and assessment.

Section 2.8. Authorization to Obtain Information. The following statements are express conditions applicable to any managed care program applicant and any appointee to the managed care program. By applying for appointment or reappointment, the individual expressly accepts these conditions during the processing and consideration of his/her application, whether or not he/she is granted appointment or reappointment.

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(a) Release of Liability and Grant of Immunity. The individual submitting an application recognizes that in accordance with the Health Care Quality Improvement Act of 1986, as amended, and Mississippi Code Annotated 41-63-1, et seq., as amended, persons, entities and organizations participating in professional review activities are immune from liability for damages for disclosures made and actions taken as is provided in such laws.

The individual expressly releases the managed care program, the members of any committee of the managed care program, the Corporate Board, the Managed Care Board, the Corporation, any of their employees, agents or authorized representatives and any third parties from any and all liability for loss, damage or injury of any nature arising from any acts, communication, documents, recommendations or disclosures involving the individual concerning the following and grants absolute immunity to the managed care program, the members of any committee of the managed care program, the Corporate Board, the Managed Care Board, the Corporation, and any of their employees, agents or authorized representatives, and any third parties as to all matters concerning the following:

(1) Applications for appointment, reappointment, and clinical privileges or the delineation of clinical privileges;

(2) Evaluations, actions or inactions concerning appointment, reappointment, and clinical privileges or the delineation of clinical privileges;

(3) Exclusion from participation in the managed care program or denial of clinical privileges requested on the basis of need (or other criteria established by the Managed Care Board and the Corporate Board), poor patient satisfaction, cost efficiency or poor clinical outcomes;

(4) Proceedings for suspension or for revocation of appointment, or any other disciplinary sanction;

(5) Summary suspension;

(6) Hearings and appellate reviews;

(7) Medical care evaluations;

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(8) Utilization reviews;

(9) Other activities relating to the quality of patient care or professional conduct;

(10) Matters of inquiries concerning the individual’s professional qualifications, credentials, clinical competence, character, ethics or behavior; or

(11) Any other matter that might directly or indirectly have an effect on the individual’s competence, on patient care or on the orderly or efficient operation of the managed care program.

(b) Authorization to Obtain Information. The individual specifically authorizes the managed care program and its representatives to consult with any third party who may have information bearing on the individual’s professional qualifications, credentials, clinical competence, character, ethics, behavior or any other matter reasonably having a bearing on the individual’s satisfaction of the criteria for initial and continued appointment to the managed care program. This authorization also covers the right to inspect or obtain any and all communications, reports, records, statements, documents, recommendations or disclosures to said third parties that may be relevant to such questions. The individual also specifically authorizes such third parties to release such information to the managed care program and its authorized representatives upon request.

(c) Authorization to Release Information. Similarly, the individual specifically authorizes the managed care program and its representatives to release such information to other health care entities which solicit such information for the purpose of evaluating the applicant’s professional qualifications pursuant to the applicant’s request for appointment, reappointment or the delineation of clinical privileges.

Section 2.9. Credentials Committee Procedure for Appointment.

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(a) The Credentials Committee may examine the evidence of the character, professional competence, qualifications, prior behavior, cost efficiency, patient satisfaction, clinical outcomes and ethical standing of the applicant and may determine, through information contained in references given by the applicant and from other sources available to the Credentials Committee, whether the applicant has established and satisfied all of the necessary qualifications for participation in the managed care program.

(b) The Credentials Committee may consider the evaluation of office locations for recognized standards such as compliance with HIPAA, infection control procedures, safety, medical records, and other recognized standards for office based Practitioners, if applicable.

(c) The Credentials Committee may consider the managed care program’s need for the applicant’s services.

(d) The Credentials Committee shall have the right to require the applicant to meet with the Credentials Committee to discuss any aspect of the applicant’s application or qualifications.

(e) The National Practitioner Data Bank, the Healthcare Integrity Protection Data Bank, and the Office of Inspector General shall be queried for all Practitioner applicants upon their request for appointment.

Section 2.10. Credentials Committee Report. Not later than one-hundred eighty (180) days from the date of the signature on the completed application, the Credentials Committee shall make a written report and recommendation with respect to the applicant to the Managed Care Board. The Chairman of the Credentials Committee or his/her designee shall be available to the Managed Care Board or its appropriate committee to answer any questions that may be raised with respect to the recommendation.

Section 2.11. Delay of Credentials Committee’s Report. If the recommendation of the Credentials Committee to the Managed Care Board is not made within one hundred eighty (180) days, the Chairman of the Credentials Committee shall send (or cause to be sent) a letter to the applicant explaining the delay.

Section 2.12. Subsequent Action on the Physician Application. The recommendation of the Credentials Committee shall be transmitted by the Chairman of

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the Credentials Committee, together with all necessary supporting documentation, including the complete application, to the Managed Care Board. The Credentials Committee shall make its recommendation that the applicant be approved for participation in the managed care program (and the scope of the applicant’s participation), that the application be deferred for further consideration or that the applicant be rejected for participation in the managed care program. The Chairman of the Credentials Committee or his/her designee shall be available to the Managed Care Board or its appropriate committee to answer any questions that may be raised with respect to the recommendation. If the Credentials Committee proposes to make a recommendation adverse to the applicant as described in Section 6.3 of this policy which entitles the applicant to a hearing, the Credentials Committee shall proceed as set forth in Article 5. If the Credentials Committee’s recommendation does not entitle the applicant to a hearing under Section 6.3 of this policy, the Managed Care Board shall act upon the recommendation of the Credentials Committee within one hundred and twenty (120) days of receipt of such recommendation and shall forward its proposed action to the Corporate Board. If the Managed Care Board proposes to take action adverse to the applicant as described in Section 5.3 of this policy, the Managed Care Board shall proceed as set forth in Article 6. If the Managed Care Board’s proposed action does not entitle the applicant to a hearing under Section 5.3 of this policy, the Corporate Board shall act upon the proposed action of the Managed Care Board within sixty (60) days of receipt of such proposed action and shall promptly notify the applicant of its action. If the Corporate Board affirms the favorable proposed action of the Managed Care Board, the Administrator shall notify the applicant that he/she has been appointed to the managed care program for an initial appointment term of thirty-six (36) months, subject to the Practitioner’s compliance with the managed care program’s requirements. If the Corporate Board proposes to take adverse action, the Corporate Board shall proceed as set forth in Article 6.

Section 2.13. Subsequent Action on the Non-physician Application. The recommendation of the Credentials Committee shall be transmitted by the Chairman of the Credentials Committee, together with all necessary supporting documentation, including the complete application, to the Managed Care Board. The Managed Care Board makes a recommendation to the Corporate Board which makes a final decision as set forth in Article 7.

Section 2.14. Recredentialing Participating Practitioners. Participating Practitioners shall be recredentialed within thirty-six (36) months of the previous credentialing date. Participating Practitioners shall be responsible for completing the reappointment application form approved by the Managed Care Board. The reappointment application shall contain the same statements required in an initial application as provided in Section 2.4 and Section 2.6 of this policy. The reappointment application shall be submitted to the Administrator at least three (3) months prior to the expiration of the participating Practitioner’s then current appointment. Reappointment, if

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granted, shall be for a period of thirty-six (36) months (unless the Corporate Board establishes a shorter period of appointment). If an application is filed and such application has not been finally acted upon prior to the expiration of the current appointment, the current appointment shall continue in effect until such time as the application is finally acted upon. The time of continuation is limited to thirty (30) days past the thirty-six (36) month credentialing deadline. At the end of such time, the Practitioner's agreement with the managed care program is terminated and the Practitioner must re-submit an application for further consideration.

Participation in the managed care program is not a matter of right and shall not necessarily be extended to all professionally competent individuals seeking reappointment to the managed care program. Participation in the managed care program may be denied to a qualified individual seeking reappointment by the Corporate Board based upon the needs of the managed care program at such time and other factors established by the Corporate Board and based upon the policies of the Managed Care Board and the Corporate Board with respect to the operation of the managed care program from time to time.

Section 2.15. Factors to Be Considered. Each recommendation concerning reappointment of a person currently participating in the managed care program may consider:

(a) The participant’s ethical behavior, clinical competence, cost efficiency, patient satisfaction and clinical judgement in the treatment of patients;

(b) The participant’s compliance with the managed care program’s bylaws, policies and rules and regulations as are in force;

(c) For office-based Practitioners, the managed care program may evaluate the Practitioner’s office or clinic assessing the compliance with practice standards including, but not limited to, universal precautions, handicapped access, patient medical records and HIPAA compliance;

(d) The participant’s behavior in the managed care program, including cooperation with other participating Practitioners or Providers;

(e) The participant’s capacity to satisfactorily treat patients as indicated by the results of the managed care program’s quality assurance activities or other reasonable indicators of continuing qualification;

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(f) The participant’s satisfactory completion of such continuing education requirements as may be imposed by law, the managed care program or applicable accreditation agencies;

(g) A review of complaints by subscribers and enrollees, results of quality review and sanctions, utilization management and enrollee satisfaction surveys;

(h) The managed care program’s need for participating Practitioners;

(i) Other relevant findings from the managed care program’s quality assurance activities; and

(j) Any such other information, in addition to that required in the application for reappointment, if additional information is desired by the Credentials Committee, the Managed Care Board or the Corporate Board.

Section 2.16. Credentials Committee Procedure for Reappointment.

(a) The Credentials Committee will review all pertinent information available, including all information provided from other committees of the managed care program and from the managed care program’s management, as well as quality assurance or utilization review information, patient outcome information and Practitioner practice pattern information and data from hospitals where a participating Practitioner has medical staff privileges for the purpose of determining its recommendations for reappointment to the managed care program.

(b) The National Practitioner Data Bank, the Healthcare Integrity Protection Data Bank, and the Office of Inspector General shall be queried for all participating Practitioners requesting reappointment or every thirty-six (36) months, or at any other time in the sole discretion of the managed care program, whichever is more frequent.

(c) Any Practitioner answering “NO” to question 13, Section D, of the application, “Are you capable of performing all the services required by your agreement with, or the professional staff bylaws of, the Managed Care Entity to which you are applying, with or without reasonable accommodation, according to accepted standards of professional performance and without posing a direct threat to the safety of patients?”, will be given the opportunity to

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explain his or her answer, including reasons and options to meet the requirement for an affirmative answer prior to the final decision of the Credentials Committee.

(d) The Credentials Committee shall thereafter submit its report and recommendation to the Managed Care Board. If the Credentials Committee’s recommendation is adverse to the participating Physician Practitioner as described in Section 5.3 of this policy, the Credentials Committee shall proceed as set forth in Article 5. The Chairman of the Credentials Committee or his/her designee shall be available to the Managed Care Board or its appropriate committee to answer any questions that may be raised with respect to the recommendation. If the Managed Care Board proposes to take action on the participating Physician Practitioner’s application for reappointment which may entitle the individual to a hearing under Section 5.3, it shall proceed as provided in Article 6 and shall notify the affected individual of its proposed action. If the Corporate Board proposes to take action on the participating Physician Practitioner’s application for appointment which may entitle the individual to a hearing under Section 5.3, it shall proceed as provided in Article 6 and shall notify the affected individual of its proposed action. If the application for reappointment has not been finally acted upon prior to the end of the appointment term, the current appointment shall continue until thirty (30) days past the thirty-six (36) month credentialing deadline. At the end of such time, the Physician Practitioner's agreement with the managed care program is terminated and the Physician Practitioner must re-submit an application for further consideration. If the Managed Care Board proposes favorable action for reappointment which is affirmed by the Corporate Board, the participating physician Practitioner shall be reappointed to the managed care program for a new appointment term of thirty-six (36) months, subject to the Physician Practitioner’s compliance with the managed care program’s requirements.

(e) For Non-physician Practitioners, the Credentials Committee shall submit its report and recommendation to the Managed Care Board. If the Credentials Committee’s recommendation is adverse to the participating Non-physician Practitioner as described in Section 7.2 of this policy, the Credentials Committee shall proceed as set forth in Article 7. The Chairman of the Credentials Committee shall forward its recommendation to the Managed Care Board or its appropriate committee as set forth in Article 7. If the

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application for reappointment has not been finally acted upon prior to the end of the appointment term, the current appointment shall continue until thirty (30) days past the thirty-six (36) month credentialing deadline. At the end of such time, the Non-physician agreement with Health Link is terminated and the Non-physician Practitioner must re-submit an application for further consideration. If the Managed Care Board proposes favorable action for reappointment which is affirmed by the Corporate Board, the participating Non-physician Practitioner shall be reappointed to the managed care program for a new appointment term of thirty-six (36) months, subject to the Non-physician Practitioner’s compliance with the managed care program’s requirements.

ARTICLE 3. PROCEDURE FOR INVESTIGATION OF

MANAGED CARE PROGRAM APPOINTEES

Section 3.1. Grounds for Action. Whenever, on the basis of information and belief, the Chairman of the Credentials Committee, the Administrator, the Chairman of the Managed Care Board or the President of the Corporation has cause to question:

(a) The clinical competence of any managed care program appointee;

(b) The care or treatment of a patient or patients or management of a case by any managed care program appointee;

(c) The known or suspected violation by any managed care program appointee of applicable ethical standards or the bylaws, policies, rules or regulations of the managed care program, including, but not limited to, the managed care program’s quality assurance, risk management and utilization review programs;

(d) The behavior or conduct on the part of any managed care program appointee that is considered lower than the standards of the managed care program or disruptive of the orderly operation of the managed care program, including the inability of the appointee to work harmoniously with others; or

(e) The failure to timely report or respond to a request for information, a written request for an investigation of the matter shall be addressed to the Credentials Committee making specific reference to the activity or conduct which gave rise to the request.

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Section 3.2. Investigative Procedure. The Credentials Committee shall meet as soon as practicable after receiving the request and if, in the opinion of the Credentials Committee:

(a) The request for an investigation contains information sufficient to warrant a recommendation, the Credentials Committee, in its discretion, shall make a recommendation to the Managed Care Board, with or without a personal interview with the appointee; or

(b) The request for an investigation does not at that point contain information sufficient to warrant a recommendation to the Managed Care Board, the Credentials Committee shall immediately investigate the matter or appoint a subcommittee to do so (the “Investigating Committee”):

(1) The Investigating Committee shall consist of up to three (3) persons, any of whom may or may not hold appointments to the managed care program. The Investigating Committee shall not include any individual who has a perceived or actual conflict of interest.

(2) The Credentials Committee or the Investigating Committee, if used, shall have available to it the full resources of the managed care program to aid in its work, as well as the authority to use outside consultants as required. The Committee(s) may also require a medical examination of the appointee by a physician or physicians satisfactory to the Committee(s) and shall require that the results of such examination be made available for the Committee’s consideration.

(3) The individual with respect to whom an investigation has been requested may be offered an opportunity to meet with the Investigating Committee before it makes its report. At this meeting (but not, as a matter of right, in advance of it,) the individual shall be informed of the general nature of the evidence supporting the investigation requested and shall be invited to discuss, explain or refute it. The interview shall not constitute a hearing, and none of the procedural rules provided in this policy with respect to hearings shall apply. A summary of such interview shall be made by the Investigating Committee and included with its report to the Credentials Committee.

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(4) If an Investigating Committee conducts an investigation, the Credentials Committee may accept, modify or reject the recommendation it receives from that Committee.

Section 3.3. Procedure after Investigation or after Receiving Request for Investigation.

(a) In acting after the investigation or after receiving the request for the investigation, the Credentials Committee may:

(1) Recommend that no action is justified;

(2) Issue a written warning;

(3) Issue a letter of reprimand;

(4) Impose terms of probation;

(5) Impose a requirement for consultation;

(6) Recommend suspension of appointment;

(7) Recommend revocation of managed care program appointment or reduction in clinical privileges; or

(8) Make such other recommendations as it deems necessary or appropriate.

(b) For the physician Practitioner, the Credentials Committee’s recommendation shall be forwarded to the Managed Care Board. The Credentials Committee shall proceed as provided in Article 5 if the Credentials Committee’s recommendation entitles the affected individual to a hearing on the Credentials Committee’s recommendation as provided in Section 5.3.

(c) For the Non-physician Practitioner, the Credentials Committee’s recommendation shall be forwarded to the Managed Care Board. The Credentials Committee shall proceed as provided in Article 7 if the Credentials Committee’s recommendation entitles the affected individual to an appeal.

(d) If the Credentials Committee’s recommendation does not entitle the individual to a hearing or an appeal in accordance with this policy, a report of the action taken and reasons therefor shall be made and delivered to the Managed Care Board. The Managed

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Care Board shall proceed as provided in Article 6 or 7 if the Managed Care Board’s proposed action entitles the affected individual to a hearing on the Managed Care Board’s proposed action as provided in Section 5.3 or an appeal as provided in Section 7.3. If the Managed Care Board’s proposed action does not entitle the individual to a hearing in accordance with this policy, a report of the proposed action and the reasons shall be made and delivered to the Corporate Board through the Chairman of the Managed Care Board. In the event the Corporate Board proposes to modify the Managed Care Board’s proposed action and such action would entitle the individual to a hearing in accordance with Section 5.3 of this policy or an appeal in accordance with Section 7.4, the Administrator shall so notify the affected individual of such individual’s right to a hearing or an appeal in accordance with Article 6 or 7.

Section 3.4. Suspension of Privileges. At any time during the investigation, either the Credentials Committee, with the approval of the Managed Care Board, or the Corporate Board may suspend the appointment of a participating Practitioner pending an investigation concerning the professional conduct or competence of the Practitioner or where the failure to take such action may result in an imminent danger to the health of any individual. This suspension shall be deemed administrative in nature, for the protection of the managed care program and/or its patients. Such suspension shall not indicate the validity of the charges and shall not remain in effect for more than fourteen (14) days (without the written consent of the affected individual) unless so authorized by the Corporate Board. If the suspension exceeds the fourteen (14) day period, the individual will be notified of his/her right to a hearing or an appeal as provided in Article 5, 6, or 7 as appropriate. If such suspension is imposed, the Medical Director shall assign another participating Practitioner to care for the suspended individual’s patients, if applicable.

ARTICLE 4. SUMMARY SUSPENSION OF APPOINTMENT PRIVILEGES

Section 4.1. Grounds for Summary Suspension.

(a) The Chairman of the Credentials Committee or, in his/her absence, his/her designee, the Chairman of the Managed Care Board or the President of the Corporation shall have the authority to summarily suspend a participating Practitioner pending an investigation concerning the professional conduct or competence of the Practitioner or whenever failure to take such action may result in an imminent danger to the health of any individual. Such suspension shall not imply final finding of responsibility for the

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situation that caused the suspension.

(b) Such summary suspension shall become effective immediately upon imposition, shall immediately be reported in writing to the Credentials Committee, the Administrator, the Chairman of the Managed Care Board and the President of the Corporation, and shall remain in effect unless or until modified by the Corporate Board.

Section 4.2. Credentials Committee Procedure. Any person who exercises authority under Section 4.1 to summarily suspend appointment privileges shall immediately report this action to the Administrator, the Credentials Committee, the Chairman of the Managed Care Board and the President of the Corporation to take further action in the matter. At that point, the Credentials Committee shall take such further action as is required by Article 3. The Credentials Committee shall report to the Managed Care Board and the Corporate Board within fourteen (14) days of the date of such suspension. The summary suspension shall remain in force until modified by the Corporate Board. If the summary suspension exceeds fourteen (14) days, the affected individual will be notified of his/her right to a hearing or an appeal as provided in Article 5, 6, or 7 as appropriate.

Section 4.3. Care of Suspended Individual’s Patients. Immediately upon the imposition of a summary suspension, the Medical Director shall assign another participating Practitioner to care for the suspended individual’s patients, if applicable.

ARTICLE 5. PHYSICIAN HEARING WITH RESPECT TO

CREDENTIALS COMMITTEE’S RECOMMENDATION

Section 5.1. Initiation of Hearing. A physician applicant or a participating physician Practitioner in the managed care program shall be entitled to a hearing based on an adverse recommendation made by the Credentials Committee regarding those matters enumerated in Section 5.3. The purpose of the hearing shall be for the hearing officer to consider the evidence and to recommend a course of action to the Managed Care Board. The hearing shall be conducted in as informal a manner as possible, subject to the rules and procedures set forth in this policy.

Section 5.2. Notice of Recommendation. When a recommendation adversely affecting the individual is proposed by the Credentials Committee, which, according to this policy, entitles an individual to a hearing on that proposed adverse recommendation, notice shall be given (or caused to be given) by the Administrator in writing to the affected individual. This notice shall contain:

(a) A statement of the proposed recommendation by the Credentials

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Committee and a statement of the general reason for the proposed recommendation;

(b) A statement that the individual has the right to request a hearing on the recommendation;

(c) Any request for a hearing shall be the earlier of 45 days from date of mailing or 30 days of the physician Practitioner’s receipt of a proposed adverse action. Failure to timely request a hearing shall be deemed a waiver of the hearing rights.

(d) The following summary of the individual’s right in the hearing:

If a hearing is requested on a timely basis, the hearing shall be before a hearing officer or officers appointed by the Administrator. At such hearing, you have the following rights:

(1) the right to be represented by an attorney or other person of your choice;

(2) the right to have a record made of the proceedings, a copy of which may be obtained by you upon payment of the reasonable charges associated with the preparation thereof;

(3) the right to call, examine and cross-examine witnesses;

(4) the right to present evidence determined to be relevant by the hearing officer(s), regardless of whether such evidence would be admissible in a court of law;

(5) the right to submit a written statement at the close of the hearing.

You shall also have the right to receive the written recommendation of the hearing officer, including a statement of the basis for the recommendation, and to receive a written final decision of the managed care program, including a statement of the basis for the decision. Your right to a hearing may be forfeited if you fail without good cause to appear.

Section 5.3. Grounds for Hearing. No proposed action or inaction, or recommendation for action or inaction, other than those hereinafter enumerated shall constitute grounds for a hearing:

(a) Denial of initial participation in the managed care program;

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(b) Denial of reappointment to the managed care program;

(c) Reduction in clinical privileges;

(d) Limitations on, or denial of, privileges requested;

(e) Revocation of appointment to the managed care program; and

(f) Suspension or summary suspension of appointment privileges which exceeds fourteen (14) days.

Section 5.4. Unappealable Actions. Neither voluntary relinquishment of appointment to the managed care program nor the imposition of a requirement for retraining, additional training or continuing education, no matter whether imposed by the Credentials Committee, the Managed Care Board or the Corporate Board, shall constitute grounds for a hearing but shall take effect without a hearing. A physician Practitioner seeking reappointment to the managed care program shall not be entitled to a hearing if the physician Practitioner is denied appointment or reappointment on the basis that the physician Practitioner failed to supply the managed care program with the required evidence of satisfactory physical and mental health within the required time period.

Section 5.5. Notice of Hearing and Statement of Reasons. If a hearing is requested by the affected individual, the Administrator shall schedule the hearing and shall give (or cause to be given) written notice to the affected individual of its time, place and date. The notice shall include a proposed list of witnesses (if any) who will give testimony at the hearing in support of the proposed action. The hearing shall be no sooner than thirty (30) days after the date of notice of the hearing unless an earlier hearing date has been agreed to in writing by the parties. The notice and the information contained in the notice may be amended or added to at any time, even during the hearing, so long as the additional material is relevant, and the individual and his/her counsel have sufficient time, but in no case more than thirty (30) days, to study this additional information and rebut it.

Section 5.6. List of Witnesses. A list of the individuals so far as are then reasonably known, who will give testimony or evidence in support of the proposed action at the hearing, shall be enclosed with the notice of the hearing as provided in Section 5.5 of this policy. The individual requesting the hearing shall also provide a list of the names of the witnesses who will give testimony or evidence on his/her behalf and a summary of other information to be offered at the hearing. This information shall be given to the Administrator within ten (10) days after receiving notice of the hearing. The witness list of either party may be supplemented or amended during the course of the hearing, provided that reasonable notice of the change is given to the other party.

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Section 5.7. Hearing Officer(s). When a hearing is requested, the Administrator shall appoint a hearing officer (or several hearing officers). Such appointment shall include designation of a Chairman if more than one hearing officer is appointed. Knowledge of the matter involved shall not preclude any individual from serving as a hearing officer. The hearing officer(s) shall not include any individual(s) who have a perceived or actual conflict of interest.

The hearing officer (or Chairman if there is more than one hearing officer) shall act to ensure that all participants in the hearing have a reasonable opportunity to be heard and to present all oral and documentary evidence, that decorum is maintained throughout the hearing and that no intimidation is permitted. The hearing officer(s) shall determine the order of procedure throughout the hearing and shall have the authority and discretion, in accordance with this policy, to make rulings on all questions which pertain to matters of procedure and to the admissibility of evidence. In all instances, the hearing officer(s) shall act in such a way that all information relevant to the appointment or reappointment of the person requesting the hearing is considered by the hearing officer(s) in formulating the recommendations. It is understood that the hearing officer(s) is acting at all times to see that all relevant information is made available for his/her deliberations and recommendations.

Section 5.8. Failure to Appear. Failure, without good cause, of the individual requesting the hearing to appear and proceed at such a hearing shall be deemed to constitute voluntary acceptance of the proposed recommended action.

Section 5.9. Postponements and Extensions. Postponements and extensions of time beyond any time limit set forth in this policy may be requested by any party but shall be permitted by the hearing officer(s) only upon a showing of good cause.

Section 5.10. Representation. The individual requesting the hearing shall be entitled to representation at the hearing by an attorney or other person of the individual’s choice to examine witnesses and present his/her case. The Chairman of the Credentials Committee shall appoint a person to support the recommendations that gave rise to the hearing and to examine and cross-examine witnesses at the hearing.

Section 5.11. Admissibility of Evidence. The hearing shall not be conducted according to rules of law relating to the examination of witnesses or presentation of evidence. Any relevant evidence shall be admitted by the hearing officer(s) if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious affairs, regardless of the admissibility of such evidence in a court of law. Each party shall have the right to submit a memorandum of points and authorities, and the hearing officer(s) may request such a memorandum to be filed following the close of the hearing. The hearing officer(s) may interrogate the witnesses, call additional witnesses or request documentary evidence if he deems it appropriate.

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Section 5.12. Official Notice. The hearing officer(s) shall have the discretion to take official notice of any matters, either technical or scientific, relating to the issue under consideration which could have been judicially noticed by the courts of this state. Participants in the hearing shall be informed of the matters to be officially noticed, and such matters shall be noted in the record of the hearing. Either party shall have the opportunity to request that a matter be officially noticed or to refute the noticed matter by evidence or by written or oral presentation of authority. Reasonable additional time shall be granted, if requested, to present written rebuttal of any evidence admitted on official notice.

Section 5.13. Basis of Decision. The decision of the hearing officer(s) shall be based on the evidence produced at the hearing. This evidence may consist of the following:

(a) Oral testimony of witnesses;

(b) Memoranda of points and authorities presented in connection with the hearing;

(c) Any information regarding the person who requested the hearing so long as that information has been admitted into evidence at the hearing and the person who requested the hearing had the opportunity to comment on and, by other evidence, refute it;

(d) Any and all applications, references and accompanying documents;

(e) All officially noticed matters; and

(f) Any other evidence that has been admitted.

Section 5.14. Burden of Proof. At any hearing conducted under this article, the following rules governing the burden of proof shall apply:

(a) The Credentials Committee shall first come forward with evidence in support of its recommendation. Thereafter, the burden shall shift to the person who requested the hearing to come forward with evidence in his/her support.

(b) After all of the evidence has been submitted by both sides, the hearing officer(s) shall recommend in favor of the recommendation proposed by the Credentials Committee unless he finds that the individual who requested the hearing has proved that the proposed recommendation that prompted the hearing was unreasonable, not sustained by the evidence or otherwise unfounded.

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Section 5.15. Adjournment and Conclusion. The hearing officer(s) may adjourn the hearing and reconvene the same at the convenience of the participants without special notice. Upon conclusion of the presentation of oral and written evidence, the hearing shall be closed.

Section 5.16. Deliberations and Recommendations of the Hearing Officer(s). Within twenty (20) days of the receipt of the hearing transcript, the hearing officer(s) shall conduct his/her deliberation outside the presence of any other person and shall render a recommendation, accompanied by a report, which shall contain a concise statement of the reasons justifying the recommendation made, and shall deliver such report to the Chairman of the Credentials Committee.

Section 5.17. Disposition of Report of Hearing Officer(s). Upon its receipt, the Chairman of the Credentials Committee shall forward the hearing officer’s report and recommendation, along with all supporting documentation, to the Managed Care Board for further action. The Administrator shall send a copy of the report and recommendations to the individual who requested the hearing and to the members of the Credentials Committee.

Section 5.18. Action by the Managed Care Board. The Managed Care Board shall act upon the proposed recommendation of the Credentials Committee and the report of the hearing officer(s). The Managed Care Board may affirm, modify or reverse the recommendation of the Credentials Committee or the hearing officer(s) or, in its discretion, refer the matter for further review and recommendation. The Managed Care Board shall take action within one hundred and twenty days (120) days after receipt of the hearing officer’s recommendation. Copies of the Managed Care Board’s decision shall be delivered to the affected individual and the Chairman of the Credentials Committee. If the matter is referred for further review and recommendation, this further review process and report back to the Managed Care Board shall in no event exceed one hundred and twenty days (120) days in duration, except as the parties may otherwise agree. The Managed Care Board shall then have one hundred and twenty days (120) days to act upon the report resulting from the further review process. The Managed Care Board shall forward its proposed action to the Corporate Board for final action.

Section 5.19. Action by the Corporate Board. Within sixty (60) days, the Corporate Board shall act upon the Managed Care Board’s proposed action. The Corporate Board takes final action by affirming, modifying or reversing the proposed action or, in its discretion, referring the matter for further review and recommendation. Copies of the action taken by the Corporate Board shall be delivered to the affected individual, the Chairman of the Credentials Committee and the Chairman of the Managed Care Board.

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ARTICLE 6. PHYSICIAN HEARING WITH RESPECT TO

PROPOSED MANAGED CARE BOARD OR CORPORATE BOARD ACTION

Section 6.1. Initiation of Hearing. A physician applicant holding appointment to the managed care program shall be entitled to a hearing before a hearing officer(s) appointed by the managed care program whenever the Managed Care Board or the Corporate Board intends to take action which would adversely affect the individual, if such proposed action entitles the individual to a hearing as provided in Section 6.3 of this policy. The hearing provided for in this article shall be available only under such circumstances where a hearing was not available under the provisions of Article 5 because the recommendation of the Credentials Committee did not adversely affect the applicant or individual holding appointment to the managed care program. Further, a hearing based on the Corporate Board’s proposed adverse action shall be available only under such circumstances where a hearing on the Managed Care Board’s proposed action was not available because the proposed action of the Managed Care Board did not adversely affect the applicant or individual holding appointment to the managed care program. An applicant holding an appointment to the managed care program is entitled to no more than one (1) hearing under this policy. The purpose of the hearing shall be for the hearing officer(s) to consider the evidence and to recommend a course of action to the Managed Care Board or the Corporate Board, as appropriate. The hearing shall be conducted in as informal a manner as possible, subject to the rules and procedures set forth in this policy.

Section 6.2. Notice of Proposed Action.

(a) When the Managed Care Board or the Corporate Board proposes to take adverse action, the affected individual shall be given notice by the Administrator in writing. This notice shall contain:

(1) A statement of the proposed adverse action to be taken by the Managed Care Board or the Corporate Board and a statement of the general reasons for the proposed adverse action;

(2) A statement that the individual has the right to request a hearing on the proposed adverse action;

(3) Any request for a hearing shall be the earlier of 45 days from date of mailing or 30 days of the physician Practitioner’s receipt of a proposed adverse action. Failure to timely request a hearing shall be deemed a waiver of the hearing rights.

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(4) The following summary of rights in the hearing:

If a hearing is requested on a timely basis, the hearing shall be before a hearing officer or officers appointed by the Administrator. At such hearing, you have the following rights:

(a) the right to be represented by an attorney or other person of your choice;

(b) The right to have a record made of the proceedings, a copy of which may be obtained by you upon payment of the reasonable charges associated with the preparation thereof;

(c) the right to call, examine and cross-examine witnesses;

(d) the right to present evidence determined to be relevant by the hearing officer(s), regardless of whether such evidence would be admissible in a court of law;

(e) the right to submit a written statement at the close of the hearing.

You shall also have the right to receive the written recommendation of the hearing officer(s), including a statement of the basis for the recommendation, and to receive a written final decision of the managed care program, including a statement of the basis for the decision. Your right to a hearing may be forfeited if you fail without good cause to appear.

(b) A request for a hearing shall be made in writing to the Administrator. In the event the affected individual does not request a hearing in the time and manner herein set forth, he/she shall be deemed to have waived his/her right to such hearing and to have accepted the proposed adverse action of the Managed Care Board or the Corporate Board, as appropriate.

Section 6.3. Grounds for Hearing. No proposed action or inaction, or recommendation for action or inaction, other than those hereinafter enumerated shall constitute grounds for a hearing:

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(a) Denial of initial participation in the managed care program;

(b) Denial of reappointment to the managed care program;

(c) Reduction in clinical privileges;

(d) Limitations on, or denial of, privileges requested;

(e) Revocation of appointment to the managed care program; and

(f) Suspension or summary suspension of appointment privileges which exceeds fourteen (14) days.

Section 6.4. Unappealable Actions. Neither voluntary relinquishment of appointment to the managed care program nor the imposition of a requirement for retraining, additional training or continuing education, no matter whether imposed by the Credentials Committee, the Managed Care Board or the Corporate Board, shall constitute grounds for a hearing but shall take effect without a hearing. A physician Practitioner seeking reappointment to the managed care program shall not be entitled to a hearing if the physician Practitioner is denied appointment or reappointment on the basis that the physician Practitioner failed to supply the managed care program with the required evidence of satisfactory physical and mental health within the required time period.

Section 6.5. Notice of Hearing and Statement of Reasons. If a hearing is requested by the affected individual, the Administrator shall schedule a hearing and shall give written notice to the affected individual of the hearing’s time, place and date. The notice shall include a list of witnesses (if any) who will give testimony in support of the adverse action proposed to be taken by the Managed Care Board or the Corporate Board. The hearing shall be no sooner than thirty (30) days after the date of the notice of the hearing unless an earlier hearing date has been specifically agreed to in writing by the parties.

Section 6.6. List of Witnesses. A list of the names of the individuals so far as are reasonably known who will give testimony at the hearing shall be enclosed with the notice of the hearing as provided in Section 6.2 of this policy. The individual requesting the hearing shall also provide a list of the names of the individual witnesses who will give testimony or evidence on his/her behalf and a summary of other information to be offered at the hearing. This information shall be given to the Administrator within ten (10) days after the individual receives notice of the hearing. The witness list of either party may, in the discretion of the hearing officer(s), be supplemented or amended during the hearing.

Section 6.7. Hearing Officer(s). When a hearing is requested, Administrator shall appoint a hearing officer (or several hearing officers). Such appointment shall include designation of a Chairman if more than one hearing officer is appointed.

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Knowledge of the matter involved shall not preclude any individual from serving as a hearing officer. The hearing officer(s) shall not include any individual(s) who have a perceived or actual conflict of interest.

The hearing officer (or Chairman if there is more than one hearing officer) shall act to ensure that all participants in the hearing have a reasonable opportunity to be heard and to present all oral and documentary evidence, that decorum is maintained throughout the hearing and that no intimidation is permitted. The hearing officer(s) shall determine the order of procedure throughout the hearing and shall have the authority and discretion, in accordance with this policy, to make rulings on all questions which pertain to matters of procedure and to the admissibility of evidence. In all instances, the hearing officer(s) shall act in such a way that all information relevant to the appointment or reappointment of the person requesting the hearing is considered by the hearing officer(s) in formulating the recommendation. It is understood that the hearing officer(s) is acting at all times to see that all relevant information is made available for his/her deliberations and recommendations.

Section 6.8. Failure to Appear. Failure of the individual requesting a hearing to appear without good cause shall be deemed to constitute acceptance of the proposed adverse action of the Managed Care Board or the Corporate Board.

Section 6.9. Postponements and Extensions. Postponements and extensions of time beyond any time limit set forth in this policy may be requested by the individual but shall be permitted only by the hearing officer(s) upon a showing of good cause.

Section 6.10. Representation. The individual requesting a hearing shall be entitled to representation at the hearing by an attorney or other person of the individual’s choice and to examine witnesses and present his/her case.

Section 6.11. Admissibility of Evidence. The hearing shall not be conducted according to the rules of law relating to the examination of witnesses or presentation of evidence. Any relevant evidence shall be admitted if it is the sort of evidence which responsible people are accustomed to rely on in the conduct of serious affairs regardless of the admissibility of such evidence in a court of law. The individual shall have the right to submit a memorandum of points and authority.

Section 6.12. Official Notice. The hearing officer(s) shall have the discretion to take official notice of any matters, either technical or scientific, relating to the issue under consideration which could have been judicially noticed by the courts of this state. Participants in the hearing shall be informed of the matters to be officially noticed, and such matters shall be noted in the record of the hearing. Either party shall have the opportunity to request that a matter be officially noticed or to refute the noticed matter by evidence or by written or oral presentation of authority. Reasonable additional time shall be granted, if requested, to present written rebuttal of any evidence admitted on official

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notice.

Section 6.13. Basis of Decision. The recommendation of the hearing officer(s) shall be based on the evidence produced at the hearing. This evidence may consist of the following:

(a) Oral testimony of witnesses;

(b) Memoranda of points and authorities presented in connection with the hearing;

(c) Any information regarding the person who requested the hearing so long as that information has been admitted into evidence at the hearing and the person who requested the hearing had the opportunity to comment on and, by other evidence, refute it;

(d) Any and all applications, references and accompanying documents;

(e) All officially noticed matters; and

(f) Any other evidence that has been admitted.

Section 6.14. Burden of Proof. At any hearing conducted under this article, the following rules governing the burden of proof shall apply:

(a) The Managed Care Board or the Corporate Board, as appropriate (or a representative thereof), shall first come forward with evidence in support of its proposed adverse action. Thereafter, the burden shall shift to the person who requested the hearing to come forward with evidence in his/her support.

(b) After all the evidence has been submitted by both sides, the hearing officer(s) shall recommend in favor of the action proposed by the Managed Care Board or the Corporate Board unless he/she finds that the individual who requested the hearing has proved that the proposed action that prompted the hearing was unreasonable, not sustained by the evidence or otherwise unfounded.

Section 6.15. Adjournment and Conclusion. The hearing officer(s) may adjourn the hearing and reconvene the same at the convenience of the participants without special notice. Upon conclusion of the presentation of oral and written evidence, the hearing shall be closed.

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Section 6.16. Deliberations and Recommendations of the Hearing Officer(s). Within twenty (20) days of the receipt of the hearing transcript, the hearing officer(s) will conduct his/her deliberation outside the presence of the individual and shall render a decision accompanied by a written report which shall contain a concise statement of his/her recommendation and the reasons therefor. A copy of the report shall be forwarded to the Administrator.

Section 6.17. Disposition of Report of Hearing Officer(s). Upon its receipt, the Administrator shall forward the hearing officer’s report and recommendation, along with all supporting documentation, to the Corporate Board for further action. The Administrator shall send a copy of the report and recommendations to the individual who requested the hearing and to the members of the Managed Care Board.

Section 6.18. Action by the Corporate Board. Within sixty (60) days, the Corporate Board shall act upon the Managed Care Board’s proposed action. The Corporate Board takes final action by affirming, modifying or reversing the proposed action or, in its discretion, referring the matter for further review and recommendation. Copies of the action taken by the Corporate Board shall be delivered to the affected individual, the Chairman of the Credentials Committee and the Chairman of the Managed Care Board.

ARTICLE 7. DENIAL, TERMINATION OR SUSPENSION OF NON-PHYSICIAN PRACTITIONER’S APPOINTMENT OR CLINICAL PRIVILEGES

Section 7.1. Grounds for Automatic Denial, Termination, or Suspension. The grounds for automatic denial, termination or suspension of a Non-physician Practitioner’s appointment and clinical privileges, without the right to an appeal, include:

(a) If applicable, the preceptor physician is no longer a participating Practitioner in the managed care program either voluntarily or involuntarily; or

(b) The Non-physician Practitioner ceases to be an employee of a participating preceptor physician or the corporation of record with managed care program credentialing that employed both the physician preceptor and the Non-physician Practitioner, if applicable, at the time of credentialing or recredentialing; or

(c) The Non-physician Practitioner’s license or certification expires, is revoked or is suspended.

Section 7.2. Procedural Rights for Denial, Restriction or Termination of Clinical Privileges. When the Credentials Committee makes any type of adverse

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recommendation, except those listed in Section 7.1, regarding clinical privileges (i.e., limitation, restriction or termination of the scope of practice previously granted, or limitation, restriction, non-inclusion or termination of Health Link participation status), the Non-physician applicant or the participating Non-physician Practitioner shall be notified, in writing, by a general statement of the reason for the recommendation by the Administrator. The Non-physician Practitioner shall be entitled to an appeal by submitting additional written information for consideration within 45 days from the date of mailing or 30 days of the Practitioner’s receipt of such notification, whichever is earlier, to the Administrator. Failure to appeal through the submission of additional information within the allotted time frame shall be deemed as a waiver of rights for additional consideration and the Credentials Committee’s recommendation will be forwarded to the Managed Care Board.

Section 7.3. Grounds for Appeal. The grounds for an appeal shall be limited to the following:

(a) There was substantial failure to comply with North Mississippi Health Link, Inc. Managed Care Programs Amended and Restated By-laws, Amended and Restated Statement of Policies and Procedures on Appointment, Reappointment and Clinical Privileges, and the Amended and Restated Delineation of Clinical Privileges Policy.

(b) The recommendation for denial, restriction or termination was arbitrary or capricious.

Section 7.4. Appeals Process. Upon receipt of additional written information from the Non-physician Practitioner and the request for further consideration of the Credentials Committee’s recommendation, the Administrator shall forward the request for further consideration, the additional information, the Credentials Committee’s recommendation and other applicable information to the Managed Care Board. The Managed Care Board may affirm, modify or reverse the Credentials Committee’s recommendation within one hundred and twenty (120) days. The Managed Care Board’s proposed action shall be forwarded to the Corporate Board.

Section 7.5. Action by the Corporate Board. Within sixty (60) days, the Corporate Board shall act upon the proposed action made by the Managed Care Board. The Corporate Board takes final action by affirming, modifying, or reversing the proposed action or, in its sole discretion, referring the matter for further review and recommendation. Copies of the action taken by the Corporate Board shall be delivered to the affected individual, the Chairman of the Credentials Committee and the Chairman of the Managed Care Board by the Administrator. The Corporate Board action is final.

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ARTICLE 8. EFFECT OF ADVERSE ACTION

A Practitioner seeking appointment or reappointment who has received a final adverse decision, or a Practitioner who has had his/her appointment terminated by virtue of corrective action, shall not be eligible to reapply for appointment for a period of five (5) years, unless the decision itself, or other provisions of this policy, provide otherwise, or the Corporate Board waives the five (5) year waiting period. Any such re-application shall be processed as an initial application, and the applicant shall submit such additional information as the Credentials Committee, the Managed Care Board or the Corporate Board may require to demonstrate that the basis for the earlier adverse action no longer exists.

ARTICLE 9. EFFECT OF APPOINTMENT OR REAPPOINTMENT

Practitioners who are appointed or reappointed to participate in a managed care program shall be entitled to exercise only those clinical privileges specifically granted by the Managed Care Board and the Corporate Board pursuant to the Delineation of Clinical Privileges Policy. A Practitioner who is appointed or reappointed to the managed care program must meet the requirements for delineation of clinical privileges as set forth in the Delineation of Clinical Privileges Policy prior to participating in the managed care program. The managed care program shall delineate clinical privileges based upon the requesting Practitioner’s qualifications and credentials in his/her area of practice, specialty or subspecialty.

ARTICLE 10. NOTICES

Section 10.1. Form and Delivery. Whenever notice is required to be given to any person, it may be given in writing mailed to the address as it is listed with the Administrator. Notices given by mail shall be deemed to be given when they are deposited in the United States mail, postage prepaid. Notice to any person may also be given, and is deemed effective upon personal delivery of written notice to the person, upon telephone notice to the person, upon facsimile transmission, upon placement of a copy of the notice in the person’s hospital mail box or upon system courier hand-delivery.

Section 10.2. Waiver. Whenever any notice is required to be given, a written waiver thereof signed by the person entitled to such notice, whether before or after the time stated therein, shall be deemed to be equivalent to such notice. Any person who attends any meeting without protesting at the commencement of the meeting the lack of notice thereof shall be conclusively deemed to have waived notice of such meeting.

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ARTICLE 11. AMENDMENTS

The Managed Care Board may recommend amendments to this policy to the Corporate Board. The Corporate Board shall have final authority to amend this Practitioner Amended and Restated Statement of Policies and Procedures on Appointment, Reappointment and Clinical Privileges and to adopt new policies by an affirmative vote of a majority of the Corporate Board. New or amended policies shall be effective when adopted. All applications in process at the time of the adoption of new or amended policies shall be processed under the policies in place at the time the application for appointment, reappointment or clinical privileges was received. All applications for appointment, reappointment or clinical privileges received after the adoption of the new or amended policies shall be processed according to the terms of the new or amended policies.

ARTICLE 12. ADOPTION

This Practitioner Amended and Restated Statement of Policies and Procedures on Appointment, Reappointment and Clinical Privileges of the managed care programs operated by North Mississippi Health Link, Inc. is adopted by majority vote of the whole Corporate Board on the 7th day of December, 2004, and replaces the Mississippi Health Ventures, Inc. Managed Care Program’s Statement of Policies and Procedures on Appointment, Reappointment and Clinical Privileges dated December 5, 1995, and shall be effective on this December 7, 2004.

NORTH MISSISSIPPI HEALTH LINK, INC. By: Gerald Wages NMHS Vice President External Affairs By: T. Homer Horton, M.D. Medical Director