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FAIRFAX MEDICAL FACILITIES, INC.

Corporate Compliance Program

FMFI Corporate Compliance Program

Adopted: December 1, 2010Last Revised: May 2018

TABLE OF CONTENTS

Page

I. IntroductionII. Purpose of Compliance Plan.III. Adoption of Compliance Program

3.01 Action by Board3.02 Pre-existing Standards and Procedures3.03 Application of the Program3.04 Policy of Compliance with Existing Laws

IV. Compliance Oversight; Designation of Compliance Officer and Committee4.01 Compliance Officer4.02 Compliance Committee4.03 Duties of Board of Directors4.04 All Persons4.05 Subcontractors, Agents and Consultants4.06 Consequences of a Violation of Operation Compliance

V. Human Resource Issues5.01 Background Checks and Credentialing5.02 Reasonable Compensation Required5.03 Legal Review of Relationships with Other Healthcare Providers5.04 Exit Interviews on Termination of Employment5.05 Non-Discrimination5.06 Disciplinary Procedure5.07 Conflicts of Interest

VI. Training and EducationVII. Monitoring and Auditing

7.01 Generally7.02 Monitoring Techniques7.03 Advice from the Government or its Agents

VIII. Response and Prevention8.01 Reports of Suspected Violations8.02 Self-Reporting8.03 Methods of Reporting8.04 Responding to Reports8.05 Corrective Action8.06 Program Modification

IX. Government Investigations or Other Litigation9.01 General9.02 Preservation of Records

X. FAIRFAX MEDICAL FACILITIES, INC. Regulation

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10.01 General10.02 Federal Tort Claims Act

XI. Patient Care and Quality Issues11.01 Scope of Services11.02 Quality of Care and Patient Safety11.03 Patient Rights11.04 Vaccines for Children Program

XII. Billing Standards and Procedures12.01 General12.02 FAIRFAX MEDICAL FACILITIES, INC. Reimbursement12.03 Cost Reports12.04 Specific Billing Standards12.05 Assignment and Reassignment12.06 Waiver of Copayments and Deductibles12.07 Identity Theft Procedures12.08 Pharmacy Affairs and 340B Drug Pricing Program

XIII. Accounting and Financial ReportingXIV. Grant ComplianceXV. Anti-Kickback/Fraud and Abuse Standards and Procedures

15.01 Payments to Referral Sources15.02 Restrictions on Gifts and Gratuities15.03 Free or Below-Market-Cost Goods or Services

XVI. Patient Referrals16.01 Referrals Generally16.02 Self-Referral Proscriptions16.03 Marketing

XVII. Physician Relationships17.01 Recruitment17.02 Agreements with Physicians17.03 Medical Directors17.04 Space and Equipment Rental

XVIII. Antitrust ComplianceXIX. Confidentiality

19.01 General19.02 Patient Information19.03 Personnel Actions/Decisions

XX. Open Meetings

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EXHIBITS

Number Description4.01.A Compliance Officer Name and Contact Information4.01.B Compliance Officer Duties4.02 Compliance Committee4.04 Employee Certification9.01 Emergency Legal Response Plan9.02 Preservation of Records11.03 Patient’s Bill of Rights15.01 Federal Anti-Kickback Statute Safe Harbor

5 FMFI Corporate Compliance Program

FAIRFAX MEDICAL FACILITIES, INC.Operation Compliance

I. Introduction

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Section 4161 of the Omnibus Budget Reconciliation Act ("OBRA") of 1990 amended § 1861(aa) of the Social Security Act ("SSA") to establish federally qualified health centers ("FQHC") as entities to provide a new Medicare benefit effective October 1, 1991. The Health Centers Consolidation Act of 1996 consolidated the Health Center Program under Section 330 of the Public Health Service Act ("PHS Act"), codified at 42 U.S.C. § 254(b). Pursuant to 42 U.S.C. § 254(b), the Health Center Program is a national program designed to provide comprehensive primary health care services to medically underserved populations through planning and operating grants to health centers. Within the U.S. Department of Health & Human Services ("DHHS"), the Health Resources and Services Administration’s ("HRSA") Bureau of Primary Health Care (“BPHC”) administers: a) the Community Health Center (“CHC”) Program; and, b) its Cooperative Agreement that includes Primary Care Associations (“PCA”).

Fairfax Medical Facilities, Inc. is deemed a Section 330 entity by meeting any one of the following five circumstances. The category applicable to this Fairfax Medical Facilities, Inc. is marked.

Designation Description Check Designation Applicable to

Adopting Entity

Receives a grant under Section 330 of the PHS Act. √

Receives funding from a PHS Act grant under a contract with the recipient of a grant and meets the requirements to receive a grant under Section 330 of the PHS Act.

Does not receive a grant under Section 330 of the PHS Act but is determined by the Secretary of DHHS to meet the requirements for receiving such a grant (i.e., qualifies as a FQHC look-alike) based on the recommendation of the HRSA.

Categorized by Secretary of DHHS for purposes of Medicare Part B as a comprehensive Federally funded

√


Designation Description Check Designation Applicable to

Adopting Entity

health center as of January 1, 1990.

Operates as an outpatient health program or facility of a tribe or tribal Fairfax Medical Facilities, Inc. under the Indian Self-Determination Act or as an urban Indian Fairfax Medical Facilities, Inc. receiving funds under Title V of the Indian Health Care Improvement Act as of October 1, 1991.

II. Purpose of Compliance Plan.

FAIRFAX MEDICAL FACILITIES, INC. ("FMFI.") is committed to conducting itself in accordance with high levels of business ethics and in compliance with applicable laws. The Office of Inspector General (the “OIG”) of DHHS recognizes that voluntary compliance plans can be a significant factor in the battle to reduce fraud and abuse in federal and state healthcare programs. In light of increased fraud and abuse enforcement efforts and to maximize compliance with all applicable laws, FAIRFAX MEDICAL FACILITIES, INC. desires to implement this legal “Compliance Program” (the “Program”) as a demonstration of its good faith efforts to operate in accordance with the highest legal and ethical standards and to be the foundation for holding its employees accountable for assisting with its compliance efforts.

III. Adoption of Compliance Program

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III.01 Action by Board

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This Program was adopted on the 1st day of December 2010, by resolution of FAIRFAX MEDICAL FACILITIES, INC.'s Board of Directors (the "Board"). Modifications will be made from time to time. The Board is knowledgeable about the content and operation of the Program and will exercise reasonable oversight with respect to the implementation and effectiveness of the Program as set forth in Section 4.03.

III.02 Pre-existing Standards and Procedures

. 2 FMFI Corporate Compliance Program

In addition to this Program, FAIRFAX MEDICAL FACILITIES, INC. has established and maintains various practices, policies and procedures which are incorporated into the Program. This Program does not supersede or diminish any other policy or program of FAIRFAX MEDICAL FACILITIES, INC. which, in whole or in part, also addresses compliance issues. In particular, patient care is the primary mission of FAIRFAX MEDICAL FACILITIES, INC., and this Program does not supersede or diminish FAIRFAX MEDICAL FACILITIES, INC.'s patient care policies and procedures.

Persons are required to comply with all applicable laws, whether or not specifically addressed in the Program. The standards of conduct set forth in this Program cannot, nor were they anticipated to, cover every situation FAIRFAX MEDICAL FACILITIES, INC. will encounter. Rather, this Program is targeted to specific areas of risk facing FAIRFAX MEDICAL FACILITIES, INC. It is the responsibility of each Person to act honestly and with integrity in all dealings and to seek guidance when necessary.

III.03 Application of the Program

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The Program applies to FAIRFAX MEDICAL FACILITIES, INC.’s employees, officers, directors, volunteers, students and independent contractors. All of these individuals and/or groups are collectively referred to throughout this document as "Persons." If any Person is unclear as to (a) the existence of, interpretation of or application of any law, or (b) whether any action complies with the Program, policies or procedures, the Person should submit their question to the Compliance Officer or to another member of the Compliance Committee.

III.04 Policy of Compliance with Existing Laws

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It is the policy of FAIRFAX MEDICAL FACILITIES, INC. to comply with all applicable federal, state and local laws. The Program is intended to (a) promote legal and ethical behavior; (b) provide a guide for the conduct of all Persons; and (c) prevent and detect violations of law.

IV. Compliance Oversight; Designation of Compliance Officer and Committee

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IV.01 Compliance Officer

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A Compliance Officer will be appointed by the CEO. The name and contact information for the Compliance Officer are set forth in Exhibit 4.01.A. The CEO may alter the appointment


and the duties of the Person serving as the Compliance Officer at any time. The specific responsibilities of the Compliance Officer are listed in Exhibit 4.01.B. In general terms, it is the responsibility of the Compliance Officer to ensure that the Program is implemented and monitored. It is not the duty of the Compliance Officer to perform all compliance related tasks. Rather, the role of the Compliance Officer is to coordinate compliance activities conducted by Persons with appropriate training and knowledge. The Compliance Officer is responsible for review of all documents and records relevant to compliance activity. The Compliance Officer will regularly report compliance related matters to the CEO.

IV.02 Compliance Committee

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The CEO shall designate a Compliance Committee. The members of the Compliance Committee are set forth in Exhibit 4.02. The Compliance Committee is established to assist with implementation of the Program. The Compliance Committee meets quarterly and the duties of the Committee shall include but not be limited to:

a. Analyze the healthcare environment, the legal requirements with which the Fairfax Medical Facilities, Inc. must comply and specific risk areas for the Fairfax Medical Facilities, Inc.

b. Assess on an ongoing basis the existing policies and procedures relating to compliance concerns, the Fairfax Medical Facilities, Inc.'s actions in response to potential compliance violations, the Fairfax Medical Facilities, Inc.'s other internal and external mechanisms for promoting compliance.

c. Work with other employees and independent contractors of the Fairfax Medical Facilities, Inc. to promote compliance with the Program.

IV.03 Duties of Board of Directors

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The CEO has the responsibility for implementing, maintaining, and overseeing the Program; and, providing updates to the Board. Board oversight will include, but not be limited to: (a) authorization for the FAIRFAX MEDICAL FACILITIES, INC. to implement the Program; (b) approval of the structure for oversight and reporting of compliance activities; (c) receipt of periodic reports concerning the Program; (d) review of any special reports on any


compliance related activity; and (e) ensuring that appropriate actions are taken in response to reports of potential non-compliance.

Percent of annual income is based on annual IRS reporting documentation. The health care industry is defined as an aggregation and integration of sectors within the economic system that provides goods and services to treat patients with curative, preventive rehabilitative, and palliative care.

IV.04 All Persons

.

Each Person is responsible for his/her own conduct. In addition to the Committee and Compliance Officer, other personnel, upon request, shall assist in the implementation of Operation Compliance, as requested. Each Person is responsible for complying with all applicable laws and regulations in the performance of their duties, whether or not specifically addressed in the Program. It is the duty of each Person to be adequately trained to perform their duties and to comply with applicable law. It is the responsibility of each Person to act honestly and with integrity in all dealings and to seek appropriate guidance when necessary. The fact that a Compliance Officer is appointed does not diminish the responsibility of each Person to comply with the law and/or the Program. Each Person who is an employee of FAIRFAX MEDICAL FACILITIES, INC. will read the Program and complete the Employee Certification and Agreement of Compliance attached as Exhibit 4.04.

IV.05 Subcontractors, Agents and Consultants

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All Persons acting as agents, consultants and independent contractors will comply with the Program. Individuals who provide services to FAIRFAX MEDICAL FACILITIES, INC. are required to observe the same standards of conduct in this respect as employees. Personnel who work with consultants, independent contractors, and vendors or who process their invoices should be aware that the Program applies to such individuals or companies. All Persons are encouraged to monitor carefully the activities of contractors in their areas. Any irregularities, questions, or concerns on those matters should be directed to the Compliance Officer.

IV.06 Consequences of a Violation of Operation Compliance

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All Persons must carry out their duties in accordance with the Program. Conduct that does not comply with the Program, or does not comply with federal, state, or local law, (a) is not authorized by FAIRFAX MEDICAL FACILITIES, INC., (b) is outside the scope of any employment or other contractual relationship, and (c) may result in disciplinary action or termination of a contractual relationship. The form of discipline for FAIRFAX MEDICAL


FACILITIES, INC. employees will be imposed in accordance with FAIRFAX MEDICAL FACILITIES, INC. disciplinary policies as set forth in its Employee Manual [or other employment policies] on a case-by-case basis. Disciplinary actions also may apply to a Person's manager, supervisor or administrator, as applicable, who (a) directs or approves the Person's improper actions; (b) is aware of those actions and their impropriety, and does not act appropriately to correct such actions; or (c) otherwise fails to exercise appropriate supervision.

V. Human Resource Issues

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V.01 Background Checks and Credentialing

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FAIRFAX MEDICAL FACILITIES, INC. aspires to a standard of excellence and quality for all caregivers. To that end, FAIRFAX MEDICAL FACILITIES, INC. will check and verify the credentials of medical professionals and will monitor the quality of services provided through appropriate peer review or auditing mechanisms. All licensed or certified health care providers who work or volunteer at FAIRFAX MEDICAL FACILITIES, INC. must undergo a credentialing and privileging process, in accordance with the "Credentialing PIN," Policy Information Notice 02-22: Clarification of Bureau of Primary Health Care Credentialing and Privileging Policy Outlined in Policy Information Notice 01-16.

All prospective employees and medical professionals seeking employment will be required to provide information concerning (a) criminal convictions; (b) exclusions from any Federal Health Care Program; (c) sanctions by any Federal Health Care Program; and (d) civil monetary penalties imposed in connection with any Federal Health Care Program. Before employment commences, FAIRFAX MEDICAL FACILITIES, INC. will conduct a criminal background check, an OIG Cumulative Sanctions check (http://www.dhhs.gov/progorg/oig), a reference check, and will check any other required databases, including, but not limited to the Oklahoma sex offenders and violent crimes registries as required by 57 O.S. § 589. FAIRFAX MEDICAL FACILITIES, INC. also will require employees to sign affidavits as required by 57 O.S. § 589 and will make employment decisions consistent with such statute. FAIRFAX MEDICAL FACILITIES, INC. will consult the National Practitioner Data Bank ("NPDB") for physicians and other practitioners on whom the NPDB collects information.

FAIRFAX MEDICAL FACILITIES, INC. will not retain any Person it knows to have been convicted of a criminal offense related to health care or who is debarred by the General Services Administration (http://www.epls.gov) or is excluded, or otherwise ineligible for participation in any federal health care programs, as defined by 42 U.S.C. § 1320a-7b(f). Pending the resolution of criminal charges or proposed debarment or exclusion, such Persons can be temporarily removed from direct responsibility for or involvement in any Federal Health Care


Program by immediate action of the Chief Executive Officer ("CEO") or any individual designated by the CEO.

V.02 Reasonable Compensation Required

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Compensation paid to Persons must be reasonable and consistent with the fair market value of the services provided. Questions concerning compensation arrangements should be directed to the Compliance Officer or another member of the Compliance Committee.

V.03 Legal Review of Relationships with Other Healthcare Providers

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Employment and independent contractor agreements with healthcare professionals who refer patients to FAIRFAX MEDICAL FACILITIES, INC. must satisfy a number of complex federal and state laws that are specific to the healthcare industry (e.g., the employment and personal services exception in the Federal Physician Self-Referral Statute (a/k/a "Stark Law"), 42 U.S.C. § 1395nn, and the Federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7b). It is the intention of FAIRFAX MEDICAL FACILITIES, INC. for all of its relationships with other healthcare providers to be structured in a manner that is consistent with such laws. No Person should make a unilateral judgment about the availability of an exception to any law. The Compliance Officer will coordinate the services of approved Legal Counsel to ensure that all relationships with other healthcare providers are appropriate.

V.04 Exit Interviews on Termination of Employment

.

FAIRFAX MEDICAL FACILITIES, INC. will attempt to conduct an exit interview for all employees terminating employment for any reason. Inquiry shall be made at the exit interview concerning any potential wrongdoing of which such employee is aware. At that time, each such employee will be required to report any otherwise reportable incidents.

V.05 Non-Discrimination

.

The policy of FAIRFAX MEDICAL FACILITIES, INC. is to provide equal opportunity to all Persons without regard to race, color, sex, religion, national origin, age, disability, Vietnam era/disabled veteran status, or other bases prohibited by applicable law. FAIRFAX MEDICAL FACILITIES, INC. policy prohibits harassment of patients or employees related to these bases. FAIRFAX MEDICAL FACILITIES, INC. has implemented employee policies to assure equal


employment opportunity in all its policy decisions affecting recruitment, selection, assignment, promotion, training, and all other terms and conditions of employment.

All Persons are responsible to act in accordance with FAIRFAX MEDICAL FACILITIES, INC.'s employee policies

V.06 Disciplinary Procedure

.

The Program includes the possibility of disciplinary action for Persons who have failed to comply with (a) the Program; (b) other policies and procedures of FAIRFAX MEDICAL FACILITIES, INC.; and (c) applicable federal and state laws and regulations. Disciplinary action may also be appropriate where a Person should have, but failed, to detect a violation. Any violation of applicable federal or state laws or regulations or deviation from the appropriate standards of conduct of the Program will subject a Person to disciplinary action, which may include, but is not limited to, any one or more of the following:

oral counseling written counseling final written counseling suspension (used for investigational purposes only) termination

The form of discipline that will be appropriate will be imposed in accordance with FAIRFAX MEDICAL FACILITIES, INC.'s disciplinary policies on a case-by-case basis. The above referenced disciplinary actions also may apply to a Person's manager, supervisor, department chief. or administrator, as applicable, who (a) directs or approves the Person's improper actions; (b) is aware of those actions and their impropriety, but does not act appropriately to correct such actions; or (c) otherwise fails to exercise appropriate supervision.

V.07 Conflicts of Interest

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A conflict of interest may occur if any Person's outside activities, personal financial interests, or other personal interests influence or appear to influence his or her ability to make objective decisions in the course of the Person's job responsibilities. A conflict of interest may also exist if the demands of any outside activities hinder or distract a Person from the performance of his or her job or cause the individual to use FAIRFAX MEDICAL FACILITIES, INC. resources for other than FAIRFAX MEDICAL FACILITIES, INC. purposes. All Persons are obligated to ensure they remain free of conflicts of interest in the performance of their responsibilities at FAIRFAX MEDICAL FACILITIES, INC. as required by the FAIRFAX MEDICAL FACILITIES, INC.'s corporate bylaws and conflict of interest policy and in


accordance with 45 CFR § 74.42 and 42 CFR § 51c.304(b). If persons have any question about whether an outside activity or personal interest might constitute a conflict of interest, they must obtain the written approval of the CEO before pursuing the activity or obtaining or retaining the interest. Employees, officers, board members and agents involved with Health Center business are required to provide a written disclosure of the conflict of interest on a respective Conflict of Interest Questionnaire. Violations are subject to disciplinary action procedures. Individuals with real or apparent conflicts of interest are prohibited from participating in the selection, award, or administration of related contract.

VI. Training and Education

.

Education and training are a critical part of the Program. Education and training will involve not only new Persons, but all existing Persons. FAIRFAX MEDICAL FACILITIES, INC. requires participation by all Persons in regular compliance education training so that all Persons will be knowledgeable about the FAIRFAX MEDICAL FACILITIES, INC.'s standards of conduct and procedures for reporting potential problems to the Compliance Officer and other appropriate individuals. Additionally, FAIRFAX MEDICAL FACILITIES, INC. will disseminate educational materials which will explain the requirements of the Program. The Compliance Committee and management personnel will be involved in identifying areas that require training and the training process.

VII. Monitoring and Auditing

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VII.01 Generally

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Regular auditing and monitoring of compliance activities is an additional feature of the Program. Compliance reports created by ongoing monitoring, as well as follow-up reports of suspected wrongdoing, will be shared with the Compliance Officer, the Compliance Committee Management Personel and the Board, as needed.

VII.02 Monitoring Techniques

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FAIRFAX MEDICAL FACILITIES, INC. will utilize periodic and/or ad hoc risk assessments or audits by internal and/or external auditors. The risk assessments or audits will focus on those areas which have specific substantive exposure to government enforcement actions. If it is determined that any error or deviation is caused by improper procedures, misunderstanding of the rules, including fraud or other systemic problems, FAIRFAX


MEDICAL FACILITIES, INC. will take appropriate steps to correct the problem. To the extent that monitoring or auditing discloses that variations or deviations were not detected in a timely manner due to deficiencies in the Program, the Program or operational policies and procedures will be modified. Other techniques that may be used to monitor or assess risk and the effectiveness of the Program include: (a) site visits; (b) interviews; (c) reviews of written materials; and (d) trend analysis studies.

VII.03 Advice from the Government or its Agents

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To the extent any Person requests advice from the government or its agents charged with administering a Federal Health Care Program, FAIRFAX MEDICAL FACILITIES, INC. will document and retain a record of such request for advice and the Government's response. Each Person receiving such advice will be responsible for providing a copy of the advice, if written, or a memorandum describing the advice, if oral, to the Compliance Officer. Every effort will be made to obtain such advice in written form to maintain all advice received in one location, and to distribute such advice to the Compliance Officer and other appropriate personnel.

VIII. Response and Prevention

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VIII.01 Reports of Suspected Violations

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All Persons have a duty under this Program to report in good faith to the Compliance Officer or any member of the Compliance Committee any possible wrongdoing or violations of applicable federal and state laws and regulations. A "suspected violation" occurs when a Person has reasonable cause to believe that a violation of civil or criminal law or of this Program has occurred or will occur. While FAIRFAX MEDICAL FACILITIES, INC. will strive to maintain confidentiality of a Person's identity, if requested, it may become necessary for such Person's identity to become known or revealed during the investigation process. FAIRFAX MEDICAL FACILITIES, INC. will not retaliate or discriminate against any Person who makes a good faith report of a suspected violation by reason of that report being made. More specifically, FAIRFAX MEDICAL FACILITIES, INC. will not retaliate or punish in any way an employee for disclosing to appropriate authorities any credible evidence of (a) gross mismanagement of an agency contract or grant relating to covered funds; (b) a gross waste of covered funds; (c) a substantial and specific danger to public health or safety related to the implementation or use of covered funds; (d) an abuse of authority related to the implementation or use of covered funds; or (e) a violation of law, rule, or regulation related to an agency contract (including the competition for or negotiation of a contract) or grant awarded or issued relating to covered funds. FAIRFAX MEDICAL FACILITIES, INC. shall inform employees of this anti-retaliation requirement in the


Employee Handbook located on the organizational website portal. Notwithstanding the foregoing, it is a violation of this Program to make a report of a suspected violation which is knowingly false. The reporting methods set forth below apply to reports of suspected violations of law or of this Program. Other issues should be reported through the normal reporting structure for FAIRFAX MEDICAL FACILITIES, INC.

VIII.02 Self-Reporting

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To be effective, the Program depends to some extent on self-reporting and acceptance of responsibility by basically honest Persons who may have made mistakes out of lack of knowledge or inattention. To the extent a Person self-reports potential wrongdoing, both the self-reporting and the acceptance of responsibility will be taken into account by FAIRFAX MEDICAL FACILITIES, INC. as a mitigating factor in determining the form of discipline.

VIII.03 Methods of Reporting

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FAIRFAX MEDICAL FACILITIES, INC. desires to establish an open line of communication between all Persons and the Compliance Officer to provide for the successful implementation and operation of the Program. FAIRFAX MEDICAL FACILITIES, INC. has an open door and non-retribution policy available to all Persons acting in good faith to encourage communication, dialogue and the reporting of incidents of potential wrongdoing. If the Compliance Officer is unavailable, or if a Person suspects the Compliance Officer of condoning the activity being reported, the Person should make a report to a) another member of the Compliance Committee; b) the CEO; or c) the Board. Reports may be made orally or by e-mail or other written forms of communication. In addition to the methods of reporting described above, all Persons, employees and nonemployees, are eligible to make an anonymous report on a FAIRFAX MEDICAL FACILITIES, INC. Complaint Form. All reports, regardless of the form, must be dated, documented and properly retained. The Compliance Officer will maintain a log of all such reports, the investigation of each such report, and its results. This information may be included in reports prepared by the Compliance Officer for the Compliance Committee, CEO and the Board.

VIII.04 Responding to Reports

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When a report of a suspected violation is received on a matter that does not concern compliance issues, that report will be referred to the appropriate individual within FAIRFAX MEDICAL FACILITIES, INC. Whenever (a) the Compliance Officer, (b) a member of the Compliance Committee, (c) other management personnel, or (d) the Board learn of any


allegation of a suspected violation, from any source, which allegation may reasonably constitute a criminal or civil healthcare-related offense, the Compliance Officer will promptly conduct a preliminary review of such allegation. Advice from Legal Counsel may be sought to determine the seriousness of the allegation. The preliminary review will be completed within thirty (30) days of the receipt of the report, unless additional time is required for completion, and such time frame is approved by the CEO.

If the Compliance Officer reasonably determines that it is necessary to conduct an internal investigation of the alleged misconduct, the Compliance Officer will conduct such an internal investigation. The Compliance Officer should take appropriate steps to secure or prevent the destruction of documents and other evidence relevant to the investigation. The internal investigation will be completed within a timely manner as monitored by the Board. All internal investigations and their results will be reported to the Board. Persons under investigation may be removed from their current workstation or work activity pending completion of an investigation or preliminary review upon action by the Compliance Officer.

VIII.05 Corrective Action

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The Compliance Officer, or any other Person designated by the CEO or Board, may implement corrective action which is reasonably necessary to ensure compliance with the Program and any applicable laws and regulations. These corrective actions may include, when appropriate, prompt reimbursement of any improper payments to Federal Health Care Programs. If unlawful conduct is detected, all efforts will be made to stop the conduct immediately and to implement an action plan to avoid the conduct in the future. FAIRFAX MEDICAL FACILITIES, INC. will report violations to appropriate governmental authorities as required by law.

VIII.06 Program Modification

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The Program may be modified at any time, and from time to time, by the Board. The Compliance Officer will recommend changes as necessary. To the extent that monitoring or auditing discloses that variations or deviations were not detected in a timely manner due to deficiencies in the Program, the Program must be modified.

IX. Government Investigations or Other Litigation

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IX.01 General

. 12 FMFI Corporate Compliance Program

The policy of FAIRFAX MEDICAL FACILITIES, INC. is to cooperate with any reasonable and lawful demand by the government made in the course of a government investigation. FAIRFAX MEDICAL FACILITIES, INC. prohibits the obstruction of justice. Any Person receiving a legal document concerning FAIRFAX MEDICAL FACILITIES, INC., including a subpoena or warrant or notice of an investigation concerning FAIRFAX MEDICAL FACILITIES, INC., shall immediately notify the Compliance Officer or the CEO. Every Person will cooperate with FAIRFAX MEDICAL FACILITIES, INC.'s response to such an investigation. A copy of the Emergency Legal Response Plan is attached as Exhibit 9.01.

IX.02 Preservation of Records

X. .

FAIRFAX MEDICAL FACILITIES, INC. regularly destroys records in a manner that is consistent with the federal and state laws governing the retention of records

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10.01 General

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FAIRFAX MEDICAL FACILITIES, INC. will provide healthcare services to Medicare and Medicaid-eligible persons pursuant to (a) Section 1861(aa) of the Social Security Act and Section 330 of the PHS Act, codified at 42 U.S.C. § 254b; (b) Parts 51C, 405 and 491 of Title 42 of the Code of Federal Regulations; (c) Medicare Benefit Policy Manual, Chapter 13 – Rural Health Clinic (RHC) and Federally Qualified Health Center (FAIRFAX MEDICAL FACILITIES, INC.) Services; (d) 63 O.S. § 1-713.1; (e) Oklahoma Administrative Code 317:30-5-660 et seq; and (f) and any other requirements included in the participation agreements with CMS and OHCA.

10.02 Federal Tort Claims Act

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The Federally Supported Health Centers Assistance Act of 1992 and 1995 granted medical malpractice liability protection through the Federal Tort Claims Act ("FTCA") to HRSA-supported health centers. Under the PHS Act, employees of eligible health centers may be deemed to be federal employees qualified for protection under the FTCA. As an eligible health center, FAIRFAX MEDICAL FACILITIES, INC. will submit an original deeming and annual renewal deeming application to the DHHS Health Resources and Services Administration, Bureau of Primary Health Care.


FAIRFAX MEDICAL FACILITIES, INC. employees are covered by the FTCA whether they are full-time or part-time. Licensed or certified health care practitioner contractors working full-time (i.e., on average at least 32.2 hours per week) or part-time providers of services in the fields of family practice, general internal medicine, general pediatrics, or obstetrics and gynecology are also covered under the FTCA. The FTCA coverage is restricted to acts or omissions which: (a) occur on or after the effective date of the FAIRFAX MEDICAL FACILITIES, INC.'s coverage (i.e., approval of deeming application); (b) are within the approved scope of FAIRFAX MEDICAL FACILITIES, INC.'s approved grant application; and (c) are within the scope of employment, contract for services, or duties as an officer or director of the FAIRFAX MEDICAL FACILITIES, INC.

If any Person has questions about the application of the FTCA to any particular service or situation, he or she should present the questions to the Compliance Officer.

XI. Patient Care and Quality Issues

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XI.01 Scope of Services

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FAIRFAX MEDICAL FACILITIES, INC. will provide all required outpatient primary, preventive, and enabling health services as defined in Section 330(b)(1)(A) of the PHS Act, codified at 42 U.S.C. § 254(b), and provide additional health services as defined in Section 330(b)(2) of the PHS Act as appropriate and necessary, either directly or through established written arrangements and referrals.

FAIRFAX MEDICAL FACILITIES, INC. shall only provide those services that it is permitted to provide pursuant to applicable statutes and regulations which include the following: (a) physician services; (b) services and supplies incident to the services of physicians; (c) nurse practitioner (NP); physician assistant (PA); certified nurse midwife (CNM); clinical psychologist (CP), and clinical social worker (CSW) services; (d) services and supplies incident to the services of NPs, PAs, CNMs, CPs, and CSWs; (e) dental services, including dentist and dental hygienist; (f) visiting nurse services to the homebound in an area where CMS has determined that there is a shortage of home health agencies; (g) otherwise covered drugs that are furnished by, and incident to, services of FAIRFAX MEDICAL FACILITIES, INC.; (h) outpatient diabetes self-management training and medical nutrition therapy for beneficiaries with diabetes or renal disease; (i) preventive primary health services when furnished by or under the direct supervision of a physician, NP, PA, CNM, CP, or CSW; and (j) other medical professionals and services deemed within project scope of service.

XI.02 Quality of Care and Patient Safety


.

FAIRFAX MEDICAL FACILITIES, INC. is committed to the delivery of safe, effective, efficient, compassionate, and satisfying patient care. All Persons should treat patients with warmth, respect, and dignity and provide care that is both necessary and appropriate. The commitment to quality of care and patient safety is an obligation of every Person. Accordingly, if any Person has a question about whether the quality or patient safety commitments of FAIRFAX MEDICAL FACILITIES, INC. are being fully met, that Person is obligated to raise this concern with the Compliance Officer or CEO.

XI.03 Patient Rights

.

Patients must be treated in a manner that preserves their dignity, autonomy, self-esteem, civil rights, and involvement in their own care. FAIRFAX MEDICAL FACILITIES, INC. makes no distinction in the availability of services or in the care provided based on age, gender, disability, race, color, religion, or national origin. FAIRFAX MEDICAL FACILITIES, INC. seeks to involve patients in all aspects of their care, including giving consent for treatment and making healthcare decisions. As applicable, each patient or patient representative must be provided with a clear explanation of care including, but not limited to, diagnosis, treatment plan, right to refuse or accept care, care decision dilemmas, advance directive options, estimates of treatment costs, and an explanation of the risks, benefits, and alternatives associated with available treatment options.

XI.04 Vaccines for Children Program

.

FAIRFAX MEDICAL FACILITIES, INC., as a provider enrolled in the federal Vaccines for Children Program ("VCF Program"), will comply with the statutory program requirements set forth at Section 1928 of the Social Security Act (42 U.S.C. § 1396s) and the terms of its provider agreement with the Centers for Disease Control ("CDC").

XII. Billing Standards and Procedures

.

XII.01 General

.

Honesty and accuracy in billing, the making of claims for payment, and the submission of cost reports is vital. FAIRFAX MEDICAL FACILITIES, INC. is committed to maintaining the accuracy of every claim and cost report it processes, prepares and submits. Each Person who has


responsibility for the preparation and submission of claims and/or cost reports is expected to monitor compliance with applicable laws and rules. Specifically, FAIRFAX MEDICAL FACILITIES, INC. is committed to compliance with the Federal False Claims Act, 31 U.S.C. § 3729 et seq. and the Oklahoma Medicaid Program Integrity Act, 56 O.S. § 1001 et seq. and other statutes and regulations related to the submission of claims. Any false, inaccurate or questionable claims or cost reports should be reported immediately to the Compliance Officer or a member of the Compliance Committee.

XII.02 FAIRFAX MEDICAL FACILITIES, INC. Reimbursement

.

a. Medicare Payment

. Generally, Medicare pays FAIRFAX MEDICAL FACILITIES, INC.’s (which are considered suppliers of Medicare services) an all-inclusive per visit payment amount based on reasonable costs as reported on the FAIRFAX MEDICAL FACILITIES, INC.’s cost report.

b. Medicaid Payment

. Generally, Medicaid pays FAIRFAX MEDICAL FACILITIES, INC.'s a facility-specific prospective payment system ("PPS") rate per visit determined according to the methodology described in OAC 317:30-5-664.12.

Occasionally, FAIRFAX MEDICAL FACILITIES, INC. may furnish services beyond the scope of those services covered under the Medicare or Medicaid FAIRFAX MEDICAL FACILITIES, INC. benefits. If covered under another separate Medicare/Medicaid benefit category, the services may be separately billed in accordance with applicable Medicare/Medicaid regulations. Since these services are not FAIRFAX MEDICAL FACILITIES, INC. services, any related costs associated with such services must be removed from allowable costs on FAIRFAX MEDICAL FACILITIES, INC.'s cost reports, as appropriate. See, Section 12.03 below.

FAIRFAX MEDICAL FACILITIES, INC. will adhere to the terms of its participation agreement with the Centers for Medicare and Medicaid Services ("CMS") and the Oklahoma Health Care Authority ("OHCA"). Such agreements incorporate by reference numerous laws and regulations. FAIRFAX MEDICAL FACILITIES, INC. will monitor revisions to such participation agreements to ensure that it remains in compliance with all of the contractual terms.

XII.03 Cost Reports

.

FAIRFAX MEDICAL FACILITIES, INC. shall complete and submit to both CMS and OHCA an annual cost report to identify all incurred costs applicable to furnishing covered


services. For Medicare, FAIRFAX MEDICAL FACILITIES, INC. shall complete Form CMS-222-92, Independent Rural Health Clinics and Freestanding Federally Qualified Health Center Cost Report. For Medicaid, FAIRFAX MEDICAL FACILITIES, INC. will complete an annual report in a form prescribed by OHCA. Such reports shall be completed accurately and in accordance with generally accepted accounting principles and the rules and regulations prescribed by both CMS and OHCA.

XII.04 Specific Billing Standards

.

All Persons must refrain from inaccurate or false billing or cost reporting practices. In particular, Persons will refrain from the following:

a. Billing for items or services not covered as a FAIRFAX MEDICAL FACILITIES, INC. benefit or not provided or rendered.

b. Misrepresenting the services actually rendered.

c. Filing duplicate claims.

d. Falsely indicating that a particular health care professional attended a procedure or that services were otherwise rendered in a manner they were not.

e. Billing for services or items that are not medically necessary.

f. Falsely certifying that certain services were medically necessary.

g. Failing to provide medically necessary services or items.

h. Including non-covered or unallowable costs on a cost report.

i. Misclassifying costs or claiming undocumented costs.

Persons who prepare or submit claims should be alert for these and other errors. No Person should submit any false claim to any payor. A bill or cost report should be submitted only when appropriate legible documentation has been maintained and is available for audit and review.

XII.05 Assignment and Reassignment

.

If there is any question whether FAIRFAX MEDICAL FACILITIES, INC. may bill for a particular service, either on behalf of a physician or allied health professional or on its own behalf, the question should be directed to the CEO for review. Persons should not submit claims


for services provided by other entities or claims prepared by other entities, including outside consultants, without approval from the CEO. Special care should be taken in reviewing these claims, and Persons should request documentation from outside entities, if necessary, to verify the accuracy of the claims.

XII.06 Waiver of Copayments and Deductibles

.

FAIRFAX MEDICAL FACILITIES, INC. will not routinely waive co-payments or deductibles except to the extent consistent with applicable laws and regulations. Waivers based on a determination of financial hardship of a particular patient are permissible under certain circumstances. No waivers are permitted except upon the approval of the CEO. FAIRFAX MEDICAL FACILITIES, INC. will make a reasonable collection effort for all coinsurance or deductible amounts. Waiver of co-payment or deductible is permitted where it is pursuant to a negotiated discount with a health plan and there is full disclosure of the waiver.

XII.07 Identity Theft Procedures

.

FAIRFAX MEDICAL FACILITIES, INC. will implement appropriate policies and procedures to identify potential instances of financial and medical identity theft.

XII.08 Pharmacy Affairs and 340B Drug Pricing Program

.

FAIRFAX MEDICAL FACILITIES, INC. has submitted a registration request to the Office of Pharmacy Affairs ("OPA") and will notify the OPA of any changes to its participation information as required. The quarterly deadlines for data submission to OPA are (a) December 1 for the quarter beginning January 1; (b) March 1 for the quarter beginning April 1; (c) June 1 for the quarter beginning July 1; and (d) September 1 for the quarter beginning October 1. It is FAIRFAX MEDICAL FACILITIES, INC.'s responsibility to inform its wholesaler or manufacturer that it is registered for the 340B discount prices when it places an order.

FAIRFAX MEDICAL FACILITIES, INC. will comply with the requirements of the 340B Program as codified in Section 340b of the PHS Act and will maintain fully auditable records that demonstrate compliance with all program requirements. In particular, FAIRFAX MEDICAL FACILITIES, INC. will refrain from the following:

a. Diverting or dispensing drugs purchased under the 340B Program to non-patients;

b. Accepting "double discounts" (i.e., a Medicaid rebate and a 340B drug discount);


c. Restocking inventory with drugs from another manufacturer (i.e., retrospective inventory replenishment must be National Drug Code specific); and

d. Inappropriately billing Medicaid for outpatient drugs administered to Medicaid patients (i.e., may only bill at the 340B acquisition cost plus the approved dispensing fee).

XIII. Accounting and Financial Reporting

.

All financial reports, accounting records, research reports, expense accounts, time sheets and other documents must accurately and clearly represent the relevant facts or the true nature of the transaction or costs and expenses associated therewith. The assets and liabilities of FAIRFAX MEDICAL FACILITIES, INC. must be accounted for properly in compliance with all tax and financial reporting requirements, generally accepted accounting principles, and established FAIRFAX MEDICAL FACILITIES, INC. accounting and financial policies and procedures. There must be no false or artificial FAIRFAX MEDICAL FACILITIES, INC. financial records made nor should there by any unrecorded FAIRFAX MEDICAL FACILITIES, INC. assets. All items of income and expense and all assets and liabilities shall be entered on the financial records of FAIRFAX MEDICAL FACILITIES, INC. All reports submitted to governmental authorities shall be accurately made, including, but not limited to Form 990, Return of Fairfax Medical Facilities, Inc. Exempt from Income Tax, submitted annually to the Internal Revenue Service ("IRS"). FAIRFAX MEDICAL FACILITIES, INC. accounting personnel and other Persons whose responsibilities fall within the financial areas must review, be familiar with and comply with all accounting and financial policies and procedures. FAIRFAX MEDICAL FACILITIES, INC. will deposit and maintain advances of Federal funds in insured accounts whenever possible as required by 45 CFR § 74.22(i)(2).

XIV. Grant Compliance

As a nonprofit Fairfax Medical Facilities, Inc. receiving HRSA funds, FAIRFAX MEDICAL FACILITIES, INC. will comply with Federal cost principles found at 2 CFR § 230, "Cost Principles for Non-Profit Fairfax Medical Facilities, Inc.s" (formerly Office of Management and Budget ("OMB") Circular A-122). FAIRFAX MEDICAL FACILITIES, INC. does not offer abortion services. FAIRFAX MEDICAL FACILITIES, INC. will maintain financial management systems in accordance with 45 CFR § 74.21 which requires grantees' financial management systems (a) to provide for accurate, current, and complete disclosure of the financial results (45 CFR § 74.21(b)(1)); (b) to ensure that accounting records are supported by source documentation (45 CFR § 74.21(b)(7)); and (c) to provide effective control over and accountability of all funds, property, and other assets so that recipients adequately safeguard all such assets and assure they are used solely for authorized purposes (45 CFR § 74.21(b)(3)).


FAIRFAX MEDICAL FACILITIES, INC. will maintain written procedures for determining the reasonableness, allocability, and allowability of costs in accordance with the provisions of the applicable Federal cost principles and the term and conditions of the grant (45 CFR § 74.21(b)(6)). FAIRFAX MEDICAL FACILITIES, INC. also will establish written procurement procedures that include certain provisions set forth in 45 CFR § 74.44.

XV. Anti - Kickback/Fraud and Abuse Standards and Procedures

.

XV.01 Payments to Referral Sources

. FAIRFAX MEDICAL FACILITIES, INC. expects all Persons to refrain from conduct which violates any anti-kickback/fraud and abuse laws (the "Anti-kickback Statute"). 42 U.S.C. § 1320a-7a and 63 O.S. § 1-742. These laws prohibit (a) direct, indirect and disguised payments in exchange for the referral of patients; (b) the submission of false, fraudulent or misleading claims to any government entity or third party payor; and (c) making false representations to any person or entity in order to gain or retain participation in a Federal or State Health Care Program or to obtain payment for any service. A violation of the Anti-kickback Statute may constitute a false or fraudulent claim under the False Claims Act.

This Program prohibits any Person from paying or accepting a payment to induce the referral of a patient to or by FAIRFAX MEDICAL FACILITIES, INC. No one acting on behalf of FAIRFAX MEDICAL FACILITIES, INC. may offer gifts, loans, rebates, services, or payment of any kind to a referral source for FAIRFAX MEDICAL FACILITIES, INC., related to a patient, nor may anyone acting on behalf of FAIRFAX MEDICAL FACILITIES, INC. accept gifts, loans, rebates, services or payment of any kind related to the referral of a patient by FAIRFAX MEDICAL FACILITIES, INC. without consulting the CEO. This applies to all oral or written agreements pursuant to which physicians or other healthcare providers receive any remuneration from FAIRFAX MEDICAL FACILITIES, INC. A number of safe harbor regulations have been adopted under the Federal Anti-Kickback Statute. e.g., 42 CFR § 1001.952.

A safe harbor specifically applicable to health centers is codified at 42 CFR § 1001.952(w). The text of the safe harbor is attached as Exhibit 15.01. Generally, the safe harbor excludes from the reach of the Anti-kickback Statute any remuneration between: (i) a health center and (ii) an individual or entity providing goods, items, services, donations, loans, or a combination of these to the health center pursuant to a contract, lease, grant, loan, or other agreement, provided that such agreement contributes to the health center's ability to maintain or increase the availability, or enhance the quality, of services provided to a medically underserved population served by the health center, and is not conditioned in any way upon the referral of patients and/or business by FAIRFAX MEDICAL FACILITIES, INC. to the individual or entity providing such items to FAIRFAX MEDICAL FACILITIES, INC.


Analysis of an activity under the Anti-kickback Statute and the safe harbors is complex and depends upon the specific facts and circumstance of each case. No Person should make a unilateral judgment on the availability of a safe harbor for a payment practice, investment, discount, or other arrangement. Any questions should be brought to the attention of the Compliance Officer for review with Legal Counsel prior to implementation. Rentals of space and equipment, agreements for professional services, management services, and consulting services will be brought to the attention of the Compliance Officer.

XV.02 Restrictions on Gifts and Gratuities

.

(a) Gifts from Patients

. No Person will solicit tips, personal gratuities or gifts from patients nor will any person accept monetary tips or gratuities. Any Person may accept non-monetary gratuities and gifts of a nominal value from patients. All Persons are expected to exercise good judgment and discretion in accepting gifts. If a patient or another individual wishes to present a monetary gift, the patient will be told about this policy. When an employee receives a gift that violates this policy, the gift should be returned to the donor and reported to the Compliance Officer.

(b) Gifts Influencing Decision - Making

. No Persons shall accept gifts, favors, services, entertainment or other things of value to the extent that decision-making or actions affecting a patient or FAIRFAX MEDICAL FACILITIES, INC. might be influenced. Gifts may be received by employees when they are of such limited value that they could not reasonably be perceived by anyone as an attempt to affect the judgment of the recipient. For example, token promotional gratuities from suppliers, such as advertising novelties (e.g., key chains) marked with the donor's name, or edibles (e.g., cookies) are not prohibited under this policy.

(c) Gifts to Referral Sources

. Gifts of nominal value may be provided to a referral source if made without intent to induce a referral. If a gift is to be made to a referral source which will result in that individual receiving gifts from FAIRFAX MEDICAL FACILITIES, INC. or any of its employees valuing over $300.00 in a calendar year, that gift must be approved in advance by the Compliance Officer. Cash gifts to referral sources are prohibited. Non cash gifts are permissible only if made without regard to the volume or value of business received by FAIRFAX MEDICAL FACILITIES, INC. from the referral source.


XV.03 Free or Below - Market - Cost Goods or Services

.

It is the policy of FAIRFAX MEDICAL FACILITIES, INC. that goods, assets or services, including space, equipment, drugs, or medical supplies, must not be provided or received at no cost or at a below market cost, unless otherwise permitted by applicable laws and regulations, specifically the safe harbor applicable to health centers set forth at 42 CFR 1001.952(w). Any situations involving free or below-market-cost goods or services must be brought to the attention of the Compliance Officer.

XVI. Patient Referrals

.

XVI.01 Referrals Generally

.

FAIRFAX MEDICAL FACILITIES, INC. policy is that patients, or their legal representatives, are free to select their healthcare providers and suppliers. The choice of a hospital, a diagnostic facility, a home health agency, or a supplier should be made by the patient with guidance from his or her physician as to which providers are qualified and medically appropriate.

XVI.02 Self - Referral Proscriptions

.

Federal law, 42 U.S.C. § 1395nn, popularly known as "the Stark Law," prohibits a physician's referral of a patient to an entity with which the physician has a financial relationship in many instances. All arrangements or transactions of FAIRFAX MEDICAL FACILITIES, INC. involving self-referral by a physician will be referred to the Compliance Officer. The Compliance Officer in conjunction with Legal Counsel, if necessary, shall decide if an appropriate exception to the self-referral statutes exists.

XVI.03 Marketing

.


Marketing material will be clear, correct, non-deceptive, and fully informative. FAIRFAX MEDICAL FACILITIES, INC. will not engage in inappropriate patient solicitation or "high pressure" marketing.

XVII. Physician Relationships

.

XVII.01 Recruitment .

The recruitment and retention of physicians require special care to comply with applicable laws and regulations. Recruitment will be conducted in relation to community needs. Each recruitment package or commitment will be in writing and consistent with applicable laws and regulations, including, but not limited to the Stark Law recruitment exception set forth at 42 CFR § 411.357(e), and will be reviewed by the Compliance Officer in consultation with Legal Counsel.

XVII.02 Agreements with Physicians

.

All agreements with physicians in which the physician is receiving goods or services from FAIRFAX MEDICAL FACILITIES, INC. or providing goods and services to FAIRFAX MEDICAL FACILITIES, INC. shall be submitted in advance to the Compliance Officer for review and approval. Where a physician is to be paid for time spent working for the benefit of FAIRFAX MEDICAL FACILITIES, INC., the Compliance Officer or CEO shall document the reasonableness of the rate paid and the need for the service. Compensation decisions will be made without regard to the volume of referrals from the physician. All such agreements will specify the particular duties or responsibilities of the physician.

XVII.03 Medical Directors

.

FAIRFAX MEDICAL FACILITIES, INC. Medical Director contracts will be in writing and approved prior to execution by the Compliance Officer in consultation with Legal Counsel. All such contracts shall specifically set forth the duties of the Medical Director. Compensation will be paid only for duties which are actually performed. Compensation will not be paid for tasks the physician is already obligated to perform by contract, law, or as a member of the medical staff.

XVII.04 Space and Equipment Rental

.


Space and equipment rental contracts involving FAIRFAX MEDICAL FACILITIES, INC. and/or any of its employed or independent contractor physicians must be (a) in writing, (b) for a term of not less than one (1) year, (c) specify the space or equipment to be leased, (d) specify the time period when the space or equipment may be used, and (e) provide for payment at fair market value not related to the volume or value of business generated. All space and equipment lease agreements will be approved in advance by the Compliance Officer, in consultation with Legal Counsel.

XVIII. Antitrust Compliance

.

All Persons must comply with applicable antitrust and similar laws which regulate competition. Examples of conduct prohibited by the antitrust laws include (a) agreements to fix prices; (b) bid rigging; (c) collusion (including price sharing) with competitors; (d) boycotts; (e) certain exclusive dealing; (f) price discrimination agreements; (g) unfair trade practices including bribery, misappropriation of trade secrets, deception, intimidation, and similar unfair practices. All Persons are expected to seek advice from their supervisor, department head, the Compliance Officer when confronted with business decisions involving a risk of violation of the antitrust laws.

XIX. Confidentiality

.

XIX.01 General

.

FAIRFAX MEDICAL FACILITIES, INC. and all Persons are in possession of and have access to a broad variety of confidential, privileged, sensitive and/or proprietary information, the inappropriate release of which could be injurious to patients, to other individuals, and to FAIRFAX MEDICAL FACILITIES, INC. itself. Each Person has an obligation to actively protect and safeguard confidential, privileged, sensitive and/or proprietary information in a manner designed to prevent the unauthorized or unlawful disclosure of such information. All Persons shall strive to maintain the confidentiality of patient and other confidential information in accordance with applicable legal and ethical standards.

XIX.02 Patient Information

.

All Persons have an obligation to conduct themselves in accordance with the principle of maintaining the confidentiality of patient information consistent with all applicable laws and regulations. In particular, it is FAIRFAX MEDICAL FACILITIES, INC.’s policy to protect the


privacy of individually identifiable health information ("IIHI") pursuant to the requirements of HIPAA, 42 U.S.C. § 201, et seq. and any amendments thereto, the regulations promulgated thereunder, 42 CFR Parts 160 and 164, and applicable Oklahoma law. The HIPAA privacy regulations comprehensively regulate when and how FAIRFAX MEDICAL FACILITIES, INC., Persons, and business associates may use and disclose IIHI. Additionally, it is FAIRFAX MEDICAL FACILITIES, INC.’s policy to protect the privacy of electronic IIHI pursuant to the security regulations promulgated under HIPAA, 45 CFR Parts 160, 162, and 164. In general, these regulations (i) regulate the internal use and external disclosure of IIHI, specifying when patient authorization is required, and the required contents of such authorization; (ii) restrict the amount of patient information shared between physicians, business associates, and other care givers to the minimum necessary; (iii) require business associate agreements prior to disclosing to a business associate (iv) require the designation of a privacy official; (v) require training of employees on patient confidentiality; (vi) establish safeguards to prevent privacy breaches(vii) allow patients to review and request amendments to their medical records; and (viii) require notification of certain breaches of unsecured IIHI. If questions arise regarding an obligation to maintain the confidentiality of information or the appropriateness of releasing such information, the immediate supervisor or the Compliance Officer should be consulted for guidance.

XIX.03 Personnel Actions/ Decisions

.

Salary, benefit and other personal information relating to Persons shall be treated as confidential. Personnel files, payroll information, disciplinary matters and similar information shall be maintained in accordance with applicable laws. All Persons will be expected to exercise due care to prevent the release or sharing or information beyond those persons who may need to know such information to fulfill their job description. Reports made pursuant to the Program shall be deemed personnel reports.

XX. Open Meetings

.

Pursuant to 63 O.S. § 1-713.1, the FAIRFAX MEDICAL FACILITIES, INC. Board shall be considered a public body for purposes of the Oklahoma Open Meeting Act ("OMA"), 25 O.S. § 301 et seq., and meetings shall be open to the extent required by the OMA.

202880



COMPLIANCE PROGRAM

EXHIBIT 4.01.A

COMPLIANCE/SAFETY OFFICER

Board of Directors appoints annually - Effective September 20, 2016.

FAIRFAX MEDICAL FACILITIES, INC.160 N MainFairfax, OK 74637918-642-3100 ext 225

Fax: 918-642-5639Office: 918-642-3100, Ext 225


FAIRFAX MEDICAL FACILITIES, INC.Compliance Program

Exhibit 4.01.B

COMPLIANCE OFFICERJOB DUTIES

SUMMARY:

The Compliance Officer oversees the Program and is responsible for implementing and monitoring the program to ensure that it provides an effective method for the prevention and detection of violations of federal and state law.

FAIRFAX MEDICAL FACILITIES, INC. RELATIONSHIPS:

Reports directly to the President/CEO and to the Board of Directors.

MAJOR TASKS, DUTIES AND RESPONSIBILITIES:

General Oversight:

Oversee the initial implementation and ongoing development of the Program.

Review, coordinate and provide guidance to formulate policies and procedures regarding compliance-related activities that are designed to effectively detect and prevent compliance violations.

Interact with members of the CEO, the Compliance Committee, the Board and other persons to ensure an understanding of the Fairfax Medical Facilities, Inc.'s initiatives towards compliance and to ensure consistency among the various departments and service areas.

Periodically evaluate and report the implementation and progress of the Program to the CEO, the Compliance Committee and the Board. Identify possible revisions to the Program on an ongoing basis, as appropriate, to meet changes in the Fairfax Medical Facilities, Inc.'s needs and in the changing healthcare industry environment and oversee their implementation.


Establish mechanisms to disseminate modifications to the Program in a timely manner to all Persons.

Education and Training:

Coordinate and monitor the development of ongoing and annual education and training of all persons regarding compliance-related activities.

Work closely with the Compliance Committee to regularly review and update the education, training and standards of conduct to reflect the current federal, state and local, laws and regulations.

Ensure that all persons providing medical services to patients of, or on behalf of, the Fairfax Medical Facilities, Inc., are aware of the Program.

Documentation:

Coordinate the logging of advice received from governmental authorities.

Ensure that a clear, comprehensive summary of key definitions (such as medical necessity, homebound, etc.) and the importance of documenting compliance with such definitions is prepared and appropriately disseminated on a regular basis.

Coordinate a system for maintaining documentation establishing that appropriate persons have received annual and ongoing training on compliance-related activities and have completed written certifications of understanding regarding the Program.

Coordinate a system for maintaining documentation of any reports received of suspected compliance violations, of the nature of any investigation conducted and any conclusions or findings there from, and of the corrective or responsive actions taken, if any.

Auditing and Monitoring:

Coordinate and implement processes and mechanisms for internally auditing and monitoring compliance within the Fairfax Medical Facilities, Inc. on an ongoing basis.

Identify and monitor designated indicators of compliance within the Fairfax Medical Facilities, Inc.

Reporting Mechanisms, Enforcement, Responsive/Corrective Actions:

Develop policies and processes that encourage all persons to report suspected fraud and other improprieties without fear of retaliation.


Monitor and respond to any questions, concerns and reports of possible violations reported through any means.

Independently investigate, or coordinate an independent investigation of, compliance related matters, including developing and implementing a responsive or corrective plan of action, where appropriate.

Coordinate any investigation with Legal Counsel in accordance with the investigation protocol established by the Fairfax Medical Facilities, Inc.

Document the facts of any violations of the Fairfax Medical Facilities, Inc.'s compliance program or related compliance policies and procedures including documentation of the specific violation, reference to historical disciplinary action for similar offenses, evaluation of the violator's work history and designation of any responsive or corrective actions taken.

Coordinate personnel issues to ensure that appropriate background checking and reporting is in operation, to ensure that introductory compliance training is provided to all new employees at the time of their employment and that ongoing training is provided on at least an annual basis, and to ensure that appropriate steps are taken to enforce the standards for conduct and the related policies and procedures consistently throughout the Fairfax Medical Facilities, Inc.



Compliance Program

Exhibit 4.02

COMPLIANCE COMMITTEE

Title or Position Contact Numbers Date

CEO 918-642-3100 Ext 233 11/15/2016

CFO 918-642-3100 Ext 229 11/15/2016

CQI Coordinator 918-642-3100 Ext 225 09/20/2016

Director of Nursing 918-642-3100 Ext 232 11/27/2017

HR Director 918-642-3100 Ext 257 10/22/2017

Billing Specialist 918-642-3100 Ext 219 11/15/2016

IT Director 918-642-3100 Ext 243 01/10/2017

1


COMPLIANCE PROGRAM

Exhibit 4.04

CERTIFICATION AND AGREEMENT OF COMPLIANCE

I am currently employed by, or under contract with, FAIRFAX MEDICAL FACILITIES, INC.

As a condition of my employment or contractor status, I have readily available to me the FAIRFAX MEDICAL FACILITIES, INC. Compliance Program. I have unrestricted on-line access to the Compliance Plan for my use during my employment at FAIRFAX MEDICAL FACILITIES, INC. I have asked any questions that I may have had about the manual and the applicable compliance policies and procedures that have been implemented. I acknowledge and understand that I am responsible for adhering to and following all of the policies and procedures of FAIRFAX MEDICAL FACILITIES, INC., including those related to the Compliance Program.

I understand and acknowledge that I am responsible for conducting myself in accordance with the Compliance Program. I understand that my failure to do so may result in disciplinary action, up to and including termination.

I understand and acknowledge that I am responsible for attending annual compliance training as a condition of my employment.

I further represent that I am responsible for reporting, in good faith, to FAIRFAX MEDICAL FACILITIES, INC. any potential violations of any applicable law or regulation.

____________________________________________ ____________________________Employee Name (please print) Position

____________________________________________ ______________________________Employee Signature Date



Compliance Program

Exhibit 9.01

EMERGENCY LEGAL RESPONSE PLAN

PURPOSE: To assure a legally appropriate, factually accurate, procedurally standardized and mutually cooperative response by FAIRFAX MEDICAL FACILITIES, INC. in the event of: (A) receipt of service of a summons notifying FAIRFAX MEDICAL FACILITIES, INC. that it has been named in a lawsuit or other legal proceeding, (B) receipt of any information about a governmental investigation, (C) contact, informal or otherwise, by a governmental investigator who wants to ask the employee questions, (D) receipt of a written auditor's request for records, (E) receipt of a service of subpoena by a governmental agency, (F) receipt of service of a search warrant, or (G) contact by the Media about a governmental investigation or other legal matter involving FAIRFAX MEDICAL FACILITIES, INC.

A. SUMMONS. If served with a lawsuit involving FAIRFAX MEDICAL FACILITIES, INC.:

1. Provide a complete copy of the lawsuit and summons to the Compliance Officer as soon as possible who will proptly notify the CEO.

2. The CEO, or his/her appropriate designee, will notify Legal Counsel for FAIRFAX MEDICAL FACILITIES, INC. as soon as possible.

B. KNOWLEDGE OF A GOVERNMENTAL INVESTIGATION. If any employee of FAIRFAX MEDICAL FACILITIES, INC. becomes aware of an investigation by a governmental agency or otherwise, or the possibility of such an investigation, concerning FAIRFAX MEDICAL FACILITIES, INC.:

1. The employee will notify his/her supervisor and the Compliance Officer as soon as possible, providing all information and or documents in the possession of the employee relative to the investigation.

2. The Compliance Officer will notify the CEO as soon as possible.

3. The CEO, or his/her appropriate designee, will contact designated Legal Counsel as soon as possible.

4. Any employee who is contacted by a government investigator will attempt to identify the agency and/or agent who is doing the investigation by requesting that the agent provide to the employee a copy of his/her photo identification badge, including the agent's individual name, title, the agency whom he/she represents,


his/her badge number and any other information which enables the employee to verify that the government investigator is authorized to conduct the investigation.

5. If the employee has any questions about the authority of the government investigator, the employee should refer the government investigator to the Compliance Officer or the CEO prior to providing any documents or other information relating to FAIRFAX MEDICAL FACILITIES, INC. or any of its employees or agents to the investigator.

C. RIGHTS OF ANY INDIVIDUAL EMPLOYEE DURING A GOVERNMENTAL INVESTIGATION INTO A CRIME: Every employee has certain rights in the event of a criminal investigation by the government. While the following list is not intended to represent all of the rights that an individual employee may have in a particular investigation, it is intended to provide each employee with a basic understanding of the fundamental rights available to any individual during the course of a government investigation into a crime:

1. Right to Not Answer Questions . An employee does not have to answer any questions of a criminal or governmental investigator.

2. Right to Presence of Legal Counsel . Even if an employee chooses to answer questions of a criminal investigator, the employee may request that his/her legal counsel be present.

3. Right to Cease Answering Questions . If an employee chooses to answer questions of a criminal investigator, whether or not his/her legal counsel is present, that employee can cease answering questions at any time during the interview.

4. Right to Schedule Unannounced Interviews/Interrogations . An employee who chooses to answer questions of a criminal investigator can schedule the interview at the employee's convenience. This means, for example, that an individual employee does not have to answer questions at the employee's home if the criminal investigator arrives unannounced.

5. Right Not to Produce Records, Documents, Evidence . Employees are under no obligation to provide any information, documents or other evidence to investigators unless the investigators produce a valid subpoena or search warrant. If an employee has any questions about the validity of the subpoena or search warrant that is produced, the employee should notify the Compliance Officer, and competent counsel will be provided to the employee for purposes of determining the validity of the subpoena or search warrant.

6. CAUTION TO EMPLOYEES . If an employee chooses to answer questions of the criminal investigator, the employee should be careful to be absolutely accurate about his/her answers because making a false statement to a governmental agent


can be a crime. For this reason, the employee should tell the criminal investigator if the employee is at all uncertain about the truth or accuracy of the statements made by the employee or about the information provided by the employee.

D. SERVICE WITH A WRITTEN AUDITOR'S REQUEST FOR RECORDS. If served with a written audit request for records, whether from the Center for Medicare and Medicaid Services ("CMS"), the Fairfax Medical Facilities, Inc.'s fiscal intermediary, a private insurance company or another source, the following will be observed:

1. Do not provide any records or items in response to the request immediately, but inform the auditor that the request will be responded to by its due date after a more complete search for relevant materials has occurred.

2. Provide a copy of the request to the Compliance Officer as soon as possible.

E. SERVICE OF A SUBPOENA BY A GOVERNMENTAL AGENCY ON AN EMPLOYEE. A subpoena is a legal document that can be issued by an attorney on behalf of a governmental agency. Generally speaking, a subpoena is not a court order. If any employee of FAIRFAX MEDICAL FACILITIES, INC. is served with a subpoena to produce records or documents (or a subpoena duces tecum, which is a subpoena for documents), the employee will take the following steps:

1. Obtain Identifying Information . Request that the governmental agent allow you to make a copy of the agent's identification badge, or at a minimum, make a written note of the name of the agency and the name of the agent who served the subpoena.

2. Copy of the Subpoena . Be sure to retain a copy of the subpoena that is served.

3. Date of Service . Note the date that you received service of the subpoena and sign your initials by any handwritten notes that you take.

4. Date for Production of Information. Read through the subpoena to identify the date by which the documents or testimony being requested must be provided.

1. Do Not Immediately Produce Records or Information . Do not provide any records or items in response to the subpoena immediately, but inform the agent that the subpoena will be responded to by its due date after a more complete search for relevant materials has occurred.

2. Notify the CEO and Compliance Officer. Anytime that a subpoena is issued, the information to be produced must be done so within a limited time frame. It is important therefore, that every employee immediately notify the CEO and Compliance Officer of FAIRFAX MEDICAL FACILITIES, INC. about the service of subpoena.


F. SERVICE OF A SEARCH WARRANT ON AN EMPLOYEE. A search warrant differs from a subpoena in that a search warrant has already been presented to a judge, and the judge has made a preliminary finding that the governmental agency issuing the search warrant has a reasonable basis to believe that a crime is being committed and that searching for the records or information being requested will lead to seizure of evidence that the crime is being committed. Unlike service of a subpoena, if an employee of FAIRFAX MEDICAL FACILITIES, INC. is served with a search warrant, documents and records will need to be secured and produced more immediately. Employees who are contacted by a governmental agent with a search warrant must take the following steps:

1. Note Identifying Information . If a governmental agent serves a search warrant on an employee, the employee should note the agency and agent serving the search warrant.

2. Immediately Contact the Compliance Officer . If any employee is contacted by a governmental agent who presents the employee with a search warrant, the employee should notify the governmental agent that FAIRFAX MEDICAL FACILITIES, INC.'s Corporate Compliance Plan requires the employee to notify FAIRFAX MEDICAL FACILITIES, INC.'s Compliance Officer immediately. The employee should then contact the Compliance Officer immediately.

3. Immediately Contact Legal Counsel . The Compliance Officer, or his or her designee, will immediately contact Legal Counsel that has been designated by FAIRFAX MEDICAL FACILITIES, INC. to assist with a response to a governmental investigation. A request should be made to the agent in charge of the search that the search be delayed until counsel can arrive. If the agent does not agree, do not hinder or obstruct the agent, but proceed with contacting Legal Counsel.

4. Coordination by Compliance Officer . The Compliance Officer, or his or her designee, will serve as the designated spokesperson for FAIRFAX MEDICAL FACILITIES, INC. in its response to and coordination with the governmental agent. The Compliance Officer, or his or her designee, will remain in the area of investigation. All other employees should be removed from the area being investigated, if possible.

5. Copy of Search Warrant . The agents are required to provide a copy of the search warrant including a description of the items for which they are looking. The Compliance Officer should obtain that document.

6. No Right to Detain Employees . Agents have no right to detain employees at the workplace.

7. Maintain Detailed Record of Areas Searched and Items Seized . The Compliance Officer should note what areas are being searched and what items are seized by


law enforcement officials. Request that you be allowed to retain a copy of any records seized, where possible.

8. Employees Have Same Rights re: Interviews by Governmental Investigators . The Compliance Officer will remind all of the employees that remain in the area for the purpose of facilitating the search and seizure about their rights as individual employees during a criminal investigation. Those rights are listed in Section C above.

9. Cooperation with Computer Data Extraction . If computer stored records are being searched and/or seized, only a FAIRFAX MEDICAL FACILITIES, INC. employee familiar with FAIRFAX MEDICAL FACILITIES, INC.'s information systems should cooperate with the agents in extracting the information from the computer.

10. Obtain Copy of Government Inventory of Items Seized . The agents are required to leave an inventory of the items seized. The Compliance Officer should obtain a copy of the inventory before the agents depart. Notwithstanding, the Compliance Officer should maintain a separate record of areas searched and items seized to ensure the accuracy of the government inventory.

11. Seizure of Privileged Documents (Attorney - Client communications, Physician - Patient Records) . If agents seize any documents containing privileged information, the Compliance Officer should notify the government agents that the records being seized are privileged, should assert the privilege, and should ask the agents to keep the privileged documents in a sealed envelope, to be segregated from the other items seized. The Compliance Officer should note on the inventory being prepared by the Compliance Officer that the privileged nature of the documents was asserted to the government agents. This will help to secure the records until Legal Counsel can deal with the privileged nature of the documents.

G. OBSTRUCTION OF AGENTS PROHIBITED. The steps outlined in this policy and procedure are designed to protect the rights of the individual employees and Fairfax Medical Facilities, Inc. in the event of certain types of government investigations. In following this policy and procedure, no employee should obstruct any government agent from conducting his/her search in a lawful and orderly manner.

H. DESTRUCTION OF RECORDS PROHIBITED. FAIRFAX MEDICAL FACILITIES, INC. regularly destroys its records in a manner that is consistent with the laws governing record retention. However, once an employee or FAIRFAX MEDICAL FACILITIES, INC. has reason to believe that certain records or documents may be the subject of a governmental investigation, those records should be retained and should not be destroyed.


I. MEDIA. Any contacts from reporters or other members of the news media regarding any investigation concerning FAIRFAX MEDICAL FACILITIES, INC. or any legal matter concerning FAIRFAX MEDICAL FACILITIES, INC. shall be immediately referred to the Compliance Officer. No employee will provide any information regarding any government investigation or other legal matter to any representative of the media.


Preservation of RecordsExhibit 9.02

Accounting Records Number of Years to RetainBank statements and deposit slips 3

Payroll – time cards 3Expense reports 6

Subsidiary ledger (A/P & A/R) 6Monthly trial balance 6

Checks (payroll and general) 8Payroll – time reports, earnings records 8

Vouchers (vendors) 8Audit reports Permanently

Corporate Records Number of Years to RetainMortgages, notes, leases (expired) 8

Bylaws, charters, operating certificates, minutes, cash books, stock & bond records, checks (for

taxes, property, important contracts, agreements, copyright & trademark

registrations, deeds, labor agreements, patents, proxies, pension records

Permanently

Tax returns and working papers Permanently

Correspondence Number of Years to RetainGeneral 3

Purchase, shipping and receiving, license 6Legal & tax Permanently

Insurance Number of Years to RetainExpired policies 4

Accident and fire inspection reports 6Group disability records, safety reports 8

Claims (after settlement) 10

Personnel Number of Years to RetainExpired contracts, daily time reports 6

Disability & sick benefits records, terminated personnel files

6

Withholding tax statements 6

Purchasing and Sales Number of Years to RetainPurchase orders, requisitions 3

Sales contracts, sales invoices 3

Shipping & Receiving Number of Years to RetainExport declarations, freight bills 4

Manifest, reports, waybills 4Patient’s Bill of Rights

Exhibit 11.03


You Have the Right To:

Be treated with courtesy, dignity, respect, and receive services that are necessary to your care without regard to race, color, creed, national origin, gender, age, sexual preference, or disability

Know the name of the health care providers and other people caring for you Be told what your condition is, what treatment is recommended, how to expect your condition to

change, and what, if any, follow-up care is needed Know the reason for tests and treatments, and understand the benefits, risks, and discomforts of

any procedures or treatments, and to participate in the decisions regarding your care Refuse to consign a consent form until you understand it Refuse treatment and understand the medical results of your refusal Know that the center participates in educational activities, and be notified that supervised health

professionals may provide health care Confidentiality of all communications and information. The health provider will not reveal

confidential information without your consent, unless provided for by law or by the need to protect the welfare of the individual or public interest

Examine and receive an explanation of your bill Security for yourself and your belongings

You Have the Responsibility To:

Treat other patients and health staff with courtesy Provide upon request necessary records for registration, billing, ability/authority to consent for

treatment Provide a correct and complete medical history, including information about past illnesses,

medications, hospitalizations, or other related information Ask questions if you do not understand papers you are asked to sign, or information given to you Take part in your care and cooperate with the treatment plan you and your provider have agreed

upon Keep appointments and be on time for them Pay for care when received Tell our staff when you are not pleased with our care Accept the results if you refuse treatments or do not follow instructions Keep your personal belongings in a safe place

Fairfax Medical Facilties, Inc. receives HHS funding and has Federal Public Health Service (PHS) deemed status with respect to certain health or health-related claims, including medical malpractice claims, for itself and its covered individuals.

For non-emergency afterhours care please call (918) 574-6127


Federal Anti-Kickback Statute Safe Harbor42 CFR § 1001.952(w)


Exhibit 15.01

(w) Health centers. As used in section 1128B of the Act, “remuneration” does not include the transfer of any goods, items, services, donations or loans (whether the donation or loan is in cash or in-kind), or combination thereof from an individual or entity to a health center (as defined in this paragraph), as long as the following nine standards are met—

(1)(i) The transfer is made pursuant to a contract, lease, grant, loan, or other agreement that—

(A) Is set out in writing;

(B) Is signed by the parties; and

(C) Covers, and specifies the amount of, all goods, items, services, donations, or loans to be provided by the individual or entity to the health center.

(ii) The amount of goods, items, services, donations, or loans specified in the agreement in accordance with paragraph (w)(1)(i)(C) of this section may be a fixed sum, fixed percentage, or set forth by a fixed methodology. The amount may not be conditioned on the volume or value of Federal health care program business generated between the parties. The written agreement will be deemed to cover all goods, items, services, donations, or loans provided by the individual or entity to the health center as required by paragraph (w)(1)(i)(C) of this section if all separate agreements between the individual or entity and the health center incorporate each other by reference or if they cross-reference a master list of agreements that is maintained centrally, is kept up to date, and is available for review by the Secretary upon request. The master list should be maintained in a manner that preserves the historical record of arrangements.

(2) The goods, items, services, donations, or loans are medical or clinical in nature or relate directly to services provided by the health center as part of the scope of the health center's section 330 grant (including, by way of example, billing services, administrative support services, technology support, and enabling services, such as case management, transportation, and translation services, that are within the scope of the grant).

(3) The health center reasonably expects the arrangement to contribute meaningfully to the health center's ability to maintain or increase the availability, or enhance the quality, of services provided to a medically underserved population served by the health center, and the health center documents the basis for the reasonable expectation prior to entering the arrangement. The documentation must be made available to the Secretary upon request.

(4) At reasonable intervals, but at least annually, the health center must re-evaluate the arrangement to ensure that the arrangement is expected to continue to satisfy the standard set forth in paragraph (w)(3) of this section, and must document the re-evaluation contemporaneously. The documentation must be made available to the Secretary upon request. Arrangements must not be renewed or renegotiated unless the health center reasonably expects the standard set forth in paragraph (w)(3) of this section to be satisfied in the next agreement


term. Renewed or renegotiated agreements must comply with the requirements of paragraph (w)(3) of this section.

(5) The individual or entity does not (i) require the health center (or its affiliated health care professionals) to refer patients to a particular individual or entity, or

(ii) restrict the health center (or its affiliated health care professionals) from referring patients to any individual or entity.

(6) Individuals and entities that offer to furnish goods, items, or services without charge or at a reduced charge to the health center must furnish such goods, items, or services to all patients from the health center who clinically qualify for the goods, items, or services, regardless of the patient's payor status or ability to pay. The individual or entity may impose reasonable limits on the aggregate volume or value of the goods, items, or services furnished under the arrangement with the health center, provided such limits do not take into account a patient's payor status or ability to pay.

(7) The agreement must not restrict the health center's ability, if it chooses, to enter into agreements with other providers or suppliers of comparable goods, items, or services, or with other lenders or donors. Where a health center has multiple individuals or entities willing to offer comparable remuneration, the health center must employ a reasonable methodology to determine which individuals or entities to select and must document its determination. In making these determinations, health centers should look to the procurement standards for recipients of Federal grants set forth in 45 CFR 74.40 through 74.48.

(8) The health center must provide effective notification to patients of their freedom to choose any willing provider or supplier. In addition, the health center must disclose the existence and nature of an agreement under paragraph (w)(1) of this section to any patient who inquires. The health center must provide such notification or disclosure in a timely fashion and in a manner reasonably calculated to be effective and understood by the patient.

(9) The health center may, at its option, elect to require that an individual or entity charge a referred health center patient the same rate it charges other similarly situated patients not referred by the health center or that the individual or entity charge a referred health center patient a reduced rate (where the discount applies to the total charge and not just to the cost-sharing portion owed by an insured patient).

For purposes of this paragraph, the term “health center” means a Federally Qualified Health Center under section 1905(l)(2)(B)(i) or 1905(l)(2)(B)(ii) of the Act, and “medically underserved population” means a medically underserved population as defined in regulations at 42 CFR 51c.102(e).


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