E. Any subcontract under paragraph A of Article XIV, or any subcontract entered into or renewed involving automated data processing systems or services, shall provide to the Secretary or his representative: 1. The right to inspect fully any and all work performed or being performed thereunder directly by the subcontractor or through arrangement with another party; 2. The right to obtain and use freely any data acquired or utilized by the subcontractor in the development and processing of claims or carrying out its functions under the subcontract; 3. The right to review without limitation all systems documentation, program logic, operating manuals, and all other operating methods and procedures involved in the performance of functions and duties under this agreement. Further, if more than 50 percent of the cost of development thereof has been paid out of Government funds, the Secretary shall have use of such information for health care or health care financing programs under the Act. F. Any subcontract under paragraph A of Article XIV, or any subcontract entered into or renewed under this agreement providing for the development of, or study of the feasibility for development of, a data processing system (including an automated data processing system), management procedures, internal or Medicare program instructional material or operating methods shall specify that the work product so produced shall inure to and remain the property of the Plan if more than 50 percent of the cost or price of such subcontract is to be paid from funds for the administration of programs under the Act, and, further, that the Secretary or his representative shall have the right of free and unrestricted use without further cost. G. Any subcontract under paragraph A of Article XIV or any subcontract entered into or renewed under this agreement involving automated data processing systems or services which required prior approval must provide that no lower tier subcontract for the performance of any functions or duties or parts thereof of such subcontracts, can be entered into without prior written approval of the Secretary and the Intermediary. Further, such subcontracts must provide for the Comptroller General of the United States and the Secretary (including their duly authorized representatives) the same right to examine subcontractor records as is provided in Article XX B of this agreement. H. Any agreement between the Plan and a medical consultant engaged by the Plan to review Medicare claims or health care utilization or to perform related services shall be deemed not to constitute a subcontract for purposes of this agreement. I. The Plan agrees to insert in its subcontracts under this agreement the applicable articles of Appendix A. J. The Plan agrees that no subcontract under this agreement shall provide for payment on a costplus-a-percentage-of-cost basis. K. It is understood and agreed that the foregoing provisions of this Article are not by way of limitation upon the Secretary's right, at the time of prior approval, to require the Plan to specify other terms and conditions requisite upon subcontractors performing functions and duties under this agreement. Article XVI A. In submitting data processing proposals for approval of the Secretary, such notification as required in Article XIV D shall include: 1. the design specifications and cost analysis of the proposed change; and B. When subcontracting, pursuant to Article XV, the Plan shall design data systems specifications, equipment performance requirement specifications, and other specifications to foster free and open competition and opportunity to responsible suppliers, including manufacturers, leasing companies and third party vendors. Article XVII NOMINATION, OR WITHDRAWAL OF NOMINATION BY A PROVIDER OF SERVICES A. The Intermediary may add other providers to the list of providers served by the Plan, except that no such provider of services may be added without the prior consent of the Plan. B. Deletions and additions to the list of providers resulting from the provisions of paragraph A of this Article shall be made on a timely basis. Article XVIII COMPLEMENTARY INSURANCE A. The Plan's complementary insurance claims process may be integrated with its Medicare insurance claims process in accordance with Regulations and General Instructions. When the insurance processes are totally or partially integrated, all direct costs shall be charged to the appropriate line of business and indirect costs shall be prorated on appropriate allocation bases consistent with the Plan's established principles of allocating indirect costs as stipulated in Article XIII B. Where the claims processes are separate, the Plan will bear the costs of transferring to its own operation, data needed on a routine or occasional basis in a manner prescribed by the Regulations and General Instructions. Where agreement has not been reached between the Intermediary and the Secretary on cost determinations concerning complementary insurance matters, these disputes will be subject to the fiscal disputes procedure of Article VI. B. The Medicare claims information which the Plan has access to for its own complementary insurance program may be disclosed to itself and to other complementary insurers but only in accordance with section 1106 of the Act and the regulations prescribed thereunder. Article XIX DIRECT COMMUNICATION WITH THE PLANS The Secretary may communicate with the Plan concerning all matters covered under this agreement. The Secretary agrees that announcement of new policy will be communicated to the Intermediary prior to any distribution of such policy to the Plan. The Secretary will give the Intermediary concurrent notice when written communications are directed to the Plans and when significant issues arise. Article XX A. The Plan shall maintain adequate accounting records covering the use of funds under this agreement. The Plan agrees that the Intermediary, the Secretary and the Comptroller General of the United States (including their duly authorized representatives), until the expiration of three years after final payment for the term of this agreement or of the time periods for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41-CFR Part 1-20), whichever expires earlier, shall have access to and the right to examine, upon reasonable notice and at all reasonable times, any directly pertinent books, documents, papers, and records of the Plan, and those of any parent, affiliated or subsidiary organization performing under formal or informal arrangement any services or furnishing any supplies or equipment to the Plan, involving transactions related to this agreement. B. The Plan further agrees to include in all subcontracts under this agreement a provision to the effect that the subcontractor agrees that the Secretary and the Comptroller General of the United States (including their duly authorized representatives), until the expiration of 3 years after final payment under the subcontract, or of the time period for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20), whichever expires earlier, shall have access to and the right to examine, upon reasonable notice and at all reasonable times, any directly pertinent books, documents, papers. and records of such subcontractors, and those of any parent, affiliated or subsidiary organization performing under formal or informal arrangement involving transactions related to the subcontract. For purposes of this Article, the term "subcontract" excludes (1) purchase orders not exceeding $2,500, and (2) subcontracts or purchase orders for public utility service at published rates established for uniform application to consumers. C. The periods of access and examination described in paragraphs A and B, above, for records which relate to (1) appeals under the "Disputes" clause of this agreement, (2) litigation or the settlement of claims arising out of the performance of this agreement, or (3) costs and expenses of this agreement as to which exception has been taken by the Comptroller General or any of his duly authorized representatives, shall continue until such appeals, litigation, claims or exceptions have been disposed of. D. Each period this agreement is in effect, shall be a separate term of this agreement for purposes of this Article and "final payment" for a term of this agreement shall be deemed to have occurred on the date of the closing agreement in paragraph H of Article VI, setting forth the final administrative costs for the final period of such term. Article XXI INSPECTION AND EVALUATION A. The Secretary and Intermediary shall have the right to appraise Plan performance under this agreement. The Secretary shall also have the right at all reasonable times, and upon reasonable notice to the Intermediary and the Plan to inspect, or otherwise evaluate the work performed or being performed hereunder and the premises in which it is being performed. Pursuant thereto, the Secretary shall have the right to maintain onsite representatives on the premises of the Plans. B. If any inspection or evaluation is made by the Secretary on the premises of the Intermediary or the Plan, or onsite representatives of the Secretary are maintained on the premises of the Intermediary or Plans, the Intermediary shall provide and shall require his subcontractor to provide all reasonable facilities and assistance for the safety and convenience of the Secretary's representatives in the performance of their duties. All inspections and evaluations by the Secretary's representatives shall be performed in such a manner as will not unduly delay the work. If a written report of such inspection or evaluation is prepared which reflects deficiencies and/or proposes corrective action to be taken by the Intermediary or the Plan, a copy shall be furnished to the Intermediary and the Plan. Any corrective action determined by the Secretary to be taken by the Intermediary or the Plan as a result of such inspection or evaluation shall be communicated directly to the Intermediary and the Plan. Article XXII A. Except as otherwise provided in this agreement, any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be decided by a duly authorized representative of the Secretary who shall reduce his decision to writing and mail or otherwise furnish a copy thereof to the Intermediary and the Plan. This decision shall be final and conclusive unless, within 30 days from the date of receipt of such copy, the Intermediary or the Plan mails or otherwise furnishes to the Secretary a written appeal. The decision of the Secretary or his duly authorized representative for the determination of such appeals shall be final and conclusive unless determined by a court of competent jurisdiction to have been fraudulent, or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence. In connection with any appeal proceeding under this clause, the Intermediary and the Plan shall be afforded an opportunity to be heard and to offer evidence in support of its appeal. Pending final decision of a dispute hereunder, the Plan shall proceed diligently with the performance of the contract and in accordance with the Secretary's decision. B. This dispute clause does not preclude consideration of law questions in connection with decisions provided for in paragraph A above: Provided, that nothing in this contract shall be construed as making final the decision of any administrative official, representative, or board on a question of law. C. Disputes concerning the interpretation or application of regulations, and general instructions or administrative procedures in connection therewith shall not be subject to the provisions of this Article. In addition, this Article shall not apply to termination of this agreement under Article XXVI, Termination of Agreement. Article XXIII The Appendices attached hereto are a part of this agreement. Article XXIV TERM OF AGREEMENT This agreement shall begin on July 1, 1975, and end on September 30, 1976. It will be automatically renewed for a period of one year unless the Intermediary or the Plan gives notice of intention to terminate the agreement at least 6 months before the end of the current period. The Secretary shall have the authority to not approve renewal of a Plan subcontract by giving notice to the Intermediary and Plan at least 6 months prior to the end of the current term of the Plan subcontract. Article XXV MODIFICATION OF AGREEMENT A. This agreement may be modified or terminated at any time by mutual consent. B. If the Secretary finds that because of enactment of P.L. 92-603, or any other subsequent legislative changes, modification of this agreement is necessary to carry out the provisions of the Act, as amended, or to perform experiments and demonstration projects pursuant to legislative enactment, he may modify any of the functions, duties, parts thereof, or any other services to be performed by the In termediary and the Plan. Prior to any such modification, the Secretary shall afford the Intermediary and the Plan an opportunity to consult and participate in planning for adjustments which might be necessary and thereafter provide the Intermediary and the Plan written notice that the modification is to be made within 90 days after a date specified in the notice. C. Within 10 days of receipt of the Secretary's notification provided in paragraph B of this Article, the Plan may terminate this agreement upon 90 days written notice to the Secretary and the Intermediary, and shall not be required to implement any modifications of this agreement provided for in such notification during such 90 day period. D. Any costs referred to in Article XXVI of this agreement, as being applicable if incurred at the termination of this agreement, shall be allowable if incurred in the effectuation of any of the aforementioned provisions. Article XXVI TERMINATION OF AGREEMENT A. The Intermediary or the Plan may terminate this agreement at any time upon 180 days notice to the Secretary, to the public, and to its providers of services. B. The Secretary, notwithstanding any other provisions of this agreement, may terminate this subcontract upon notification to the Intermediary and the Plan within 90 days after July 1, 1975, provided that the termination shall be effective as of a date not less than 90 days following the date of such notification as specified therein. C. If the Secretary finds, after 60 days notice and opportunity for hearing to the Intermediary and the Plan that: 1. the Plan failed substantially to carry out this agreement, or 2. the continuation of some or all of the functions provided for in this agreement is disadvantageous or is inconsistent with the efficient administration of Title XVIII of the Act, the Secretary may terminate this agreement at any time upon 120 days notice to the Plan and to its providers of services. D. If this agreement is terminated by either the Secretary, the Intermediary or the Plan in any manner provided in this agreement (including non-renewals under Article XXIV), any funds advanced to the Plan under this agreement which have not been expended or encumbered in accordance with the terms of this agreement prior to the date the agreement was terminated, shall be returned to the Intermediary, and any funds determined to be due the Intermediary or the Plan, after the application of Article VI, shall be paid to such party. Prior to final payment under this agreement, the Plan shall execute and deliver an assignment to the Intermediary, in such form as he may prescribe, of refunds, rebates, credits, or other amounts (including interest thereon) which are due the Plan and which are properly allocable to costs for which the Plan has been reimbursed under this agreement. In determining the amount due to either party, reimbursable costs shall be determined in accordance with paragraph B of Article XIII. E. Any costs referred to under this Article shall be allowable if incurred in the implementation of any of the aforementioned provisions. Article XXVII CONTINUANCE OF FUNCTIONS AND DUTIES UNDER PRIOR AGREEMENT It is understood and agreed that the continuance of performance after June 30, 1975, of any function or duty undertaken under the agreement between the Plan and the Intermediary pursuant to sections |