INTEGRITY AGREEMENT BETWEEN THE OFFICE OF INSPECTOR GENERAL OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES AND RHINE DRUG COMPANY AND ANDY CARTER CLEMENTS, JR. I. PREAMBLE Rhine Drug Company and Andy Carter Clements, Jr. (collectively, Rhine Drug) hereby enter into this Integrity Agreement (IA) with the Office of Inspector General (OIG) of the United States Department ofHealth and Human Services (HHS) to promote compliance with the statutes, regulations, and written directives ofMedicare, Medicaid, and all other Federal health care programs (as defined in 42 U.S.C. § 1320a-7b(f)) (Federal health care program requirements). Contemporaneously with this IA, Rhine Drug is entering into a Settlement Agreement with the United States. II. TERM AND SCOPE OF THE IA A. This IA shall have a term of three years from the Effective Date. The Effective Date shall be the date on which the final signatory signs this IA. Each one-year period, beginning with the one-year period following the Effective Date, shall be referred to as a "Reporting Period." B. Sections VII, X, and XI shall expire no later than 120 days after OIG's receipt of: (1) Rhine Drug's final annual report; or (2) any additional materials submitted by Rhine Drug pursuant to OIG's request, whichever is later. C. The term "Covered Persons" includes: 1. Andy Carter Clements, Jr. (Carter Clements), and all employees of Rhine Drug Company; and 2. all contractors, agents, and other persons who are involved in the dispensing of prescription drugs or who perform billing functions on behalf ofRhine Drug. 1 Rhine Drug Integrity Agreement III. INTEGRITY OBLIGATIONS Rhine Drug shall establish and maintain a Compliance Program that includes the following elements: A. Posting ofNotice Within 60 days after the Effective Date, Rhine Drug shall post in a prominent place accessible to all patients and Covered Persons a notice that provides the HHS OIG Fraud Hotline telephone number (1-800-HHS-TIPS) as a confidential means by which suspected fraud or abuse in the Federal health care programs may be reported. B. Training and Education 1. Training. All Covered Persons shall receive at least three hours of training during the first Reporting Period. Training may be completed in-person or online. These training requirements may be satisfied by training courses that are submitted to 010, including any provided by the State Pharmacy Association or Medicare Part D plan prior to registration for the training course, for review and approval. At a minimum, the required training sessions must include the following topics: a. the Federal health care program requirements, including billing, coding and claim submission statutes, regulations, and program requirements and the requirements relating to dispensing of and billing for prescription drugs by Rhine Drug; b. State Board of Pharmacy requirements relating to the dispensing ofprescription drugs, including but not limited to prescription documentation requirements; c. Federal and state health care program requirements regarding the accurate submission ofpharmacy claims, including requirements regarding prescription refills, billing, and crediting requirements; and 2 Rhine Drug Integrity Agreement d. the Federal health care program requirements and State requirements relating documentation ofphysician orders for prescription drugs and documentation that the prescription drugs were dispensed. New Covered Persons shall receive at least three hours oftraining within 90 days after becoming a Covered Person. The OIG may, in its discretion, require that Covered Persons complete additional hours oftraining regarding the topics identified above, or additional topics, in the second and third years ofthe IA. The OIG shall provide notice to Rhine Drug ofsuch additional required training at least 180 days prior to the required completion date for such training. 2. Training Records. Rhine Drug shall maintain written documentation (e.g., written or electronic certificates of completion from the training provider) that all Covered Persons required to receive training have in fact completed such training. The documentation shall specify the type oftraining received, the individual who completed the training, and the date received. C. Review Procedures 1. General Description. a. Engagement ofIndependent Review Organization. Within 60 days after the Effective Date, Rhine Drug shall engage an individual or entity, such as an accounting, auditing, or consulting. firm (hereinafter "Independent Review Organization" or "IRO"), to perform the reviews listed in this Section III.C . .The applicable requirements relating to the IRO are outlined in Appendix A to this IA, which is incorporated by reference. b. Retention ofRecords. The IRO and Rhine Drug shall retain and make available to OIG, upon request, all work papers, supporting documentation, correspondence, and draft reports (those exchanged between the IRO and Rhine Drug ) related to the reviews. 2. Claims Review. The IRO shall conduct a review ofRhine Drug's claims submitted to and reimbursed by the Medicare and Medicai~ programs, to 3 Rhine Drug Integrity Agreement determine whether the prescription drugs furnished by Rhine Drugs were dispensed according to a valid prescription, whether appropriate documentation of a valid prescription was maintained, and whether the claims were appropriately submitted and reimbursed for each three-month period during the term ofthis IA (Quarterly Claims Review) and shall prepare a Quarterly Claims Review Report, as outlined in Appendix B to this IA, which is incorporated by reference. The first three~month period for purposes of the Quarterly Claims Review requirement shall begin 30 days after the Effective Date. Each Quarterly Claims Review Report shall be submitted to OIG within 60 days following the end ofthe three-month period covered by the Quarterly Claims Review. 3. Independence and Objectivity Certification. Prior to performing the first Quarterly Claims Review, and annually thereafter, the IRO shall provide to Rhine Drug a certification that the IRO has (a) evaluated its professional independence and objectivity with respect to the reviews required under this Section III.C and (b) conclude4 that it is, in fact, independent and objective, in accordance with the requirements specified in Appendix A to this IA. The IRO's certification shall include a summary of all current and prior engagements between Rhine Drug and the IRO. D. Ineligible Persons I. Definitions. For purposes of this IA: a. an "Ineligible Person" shall include an individual or entity who: i. is currently excluded from participation in any Federal health care program; or n. has been convicted of (a) a criminal offense that is related to the delivery of an item or service under Medicare or any state health care program; (b) a criminal offense relating to neglect or abuse of patients; ( c) a felony criminal offense relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in connection with the delivery of a health care item or service or with respect to a government funded health care program (other than Medicare or a state health care program); or ( d) a felony criminal offense relating to the unlawful manufacture, distribution, prescription 4 Rhine Drug Integrity Agreement or dispensing of a controlled substance, but has not yet been excluded, debarred, suspended, or otherwise declared ineligible. b. "Exclusion List" means the HHS/OIG List of Excluded Individuals/Entities (available through the Internet.at http://www.oig.hhs.gov). 2. Screening Requirements. Rhine Drug stiall ensure that all prospective and current Covered Persons are not Ineligible Persons, by implementing the following screening requirements. a. Rhine Drug shall screen all prospective Covered Persons against the Exclusion List prior to engaging their services and, as part of the hiring or contracting process, shall require such Covered Persons to disclose whether they are Ineligible Persons. b. Rhine Drug shall screen all current Covered Persons against the Exclusion List within 30 days after the Effective Date and on a monthly basis thereafter. c. Rhine Drug shall require all Covered Persons to disclose immediately if they become an Ineligible Person. Rhine Drug shall maintain documentation (i.e., a print screen ofthe search results) in order to demonstrate that Rhine Drug: ( 1) has checked the Exclusion List and determined that its Covered Persons are not Ineligible Persons; and (2) has required its Covered Persons to disclose if they are an Ineligible Person. Nothing in this Section III.D affects Rhine Drug's responsibility to refrain from (and liability for) billing Federal health care programs for items or services furnished, ordered, or prescribed by an excluded person. Rhine Drug understands that items or services furnished by excluded persons are not payable by Federal health care programs and that Rhine Drug may be liable for overpayments and/or criminal, civil, and administrative sanctions for employing or contracting with an excluded person regardless of whether Rhine Drug meets the requirements of Section III.D. 3. Removal Requirement. IfRhine Drug has actual notice that a Covered Person has become an Ineligible Person, Rhine Drug shall remove such Covered 5 Rhine Drug Integrity Agreement Person from responsibility for, or involvement with, Rhine Drug's business operations related to the Federal health care program(s) from which such Covered Person has been excluded and shall remove such Covered Person from any position for which the Covered Person's compensation or the items or services furnished, ordered, or prescribed by the Covered-Person are paid in whole or part, directly or indirectly, by any Federal health care program(s) from which the Covered Person has been excluded at least until such time as the Covered Person is reinstated into participation in such Federal health care program(s). 4. Pending Charges and Proposed Exclusions. IfRhine Drug has actual notice that a Covered Person is charged with a criminal offense that falls within the scope of42 U.S.C. §§ 1320a-7(a), 1320a-7(b) (1 )-(3), or is proposed for exclusion during the Covered Person's employment or contract term, Rhine Drug shall take all appropriate actions to ensure that the responsibilities ofthat Covered Person have not and shall not adversely affect the quality of care rendered to any beneficiary or the accuracy of any claims submitted to any Federal health care program. E. Notification of Government Investigation or Legal Proceeding Within 30 days after discovery, Rhine Drug shall notify OIG, in writing, ofany ongoing investigation or legal proceeding known to Rhine Drug conducted or brought by a governmental entity or its agents involving an allegation that Rhine Drug or Carter Clements has committed a crime or has engaged in fraudulent activities. This notification shall include a description ofthe allegation, the identity of the investigating or prosecuting agency, and the status ofsuch investigation or legal proceeding. Rhine Drug shall also provide written notice to OIG within 30 days after the resolution ofthe matter, and shall provide OIG with a description ofthe findings and/or results ofthe investigation or proceeding, if any. F. Overpayments I. Definition ofOverpayments. An "Overpayment" means any funds that Rhine Drug receives or retains under any Federal health care program to which Rhine Drug, after applicable reconciliation, is not entitled under such Federal health care program. 2. Repayment ofOverpayments. If, at any time, Rhine Drug identifies any Overpayment, Rhine Drug shall repay the Overpayment to the appropriate payor (~, Medicare contractor) in accordance with the requirements of the Centers for Medicare and Medicaid Services (CMS) overpayment statute and regulations, 42 U.S.C. § 1320a-7k(d ) and 42 C.F .R. §§ 401.301-305, and any applicable CMS guidance. Rhine 6 Rhine Drug Integrity Agreement Drug should follow the payo r's policies regarding the form of notification and the repayment process for any Overpayment refunds. Any questions regarding the repayment process should be directed to the payor. G. Reportable Events 1. Definition ofReportable Event. For purposes of this IA, a "Reportable Event" means anything that involves: a. a substantial Overpayment; b. a matter that a reasonable person would consider· a probable violation of criminal, civil, or administrative laws applicable to any Federal health care program for which penalties or exclusion may be authorized; c. the employment ofor contracting with a Covered Person who is an Ineligible Person as defined by Section 111.D. l .a; or d. the filing ofa bankruptcy petition by Rhine Drug. A Reportable Event may be the result of an isolated event or a series of occurrences. 2. Reporting ofReportable Events. IfRhine Drug determines (after a reasonable opportunity to conduct an appropriate review or investigation ofthe allegations) through any means that there is a Reportable Event, Rhine Drug shall notify OIG, in writing, within 30 days after making the determination that the Reportable Event exists. 3. Reportable Events under Section 111.G.J.a and 111.G.J.b. For Reportable Events under Section III.G.l.a and b, the report to OIG shall include: a. a complete description of all details relevant to the Reportable Event, including, at a minimum, the types ofclaims, transactions or other conduct giving rise to the Reportable Event; the period during which the conduct occurred; and the names of entities and individuals believed to be implicated, including an explanation oftheir roles in the Reportable Event; 7 Rhine Drug Integrity Agreement b. a statement ofthe Federal criminal, civil or administrative laws that are probably violated by the Reportable Event, if any; b. the Federal health care programs affected by the Reportable Event; c. a description of the steps taken by Rhine Drug to identify and quantify any Overpayments; and d. a description ofRhine Drug's actions taken to correct the Reportable Event and prevent it from recurring. Ifthe Reportable Event involves an Overpayment, within 60 days of identification of the Overpayment, Rhine Drug shall repay the Overpayment, in accordance with the requirements of 42 U.S.C. § 1320-7k(d) and 42 C.F.R. § 401.301-305 (and any applicable CMS guidance) and provide OIG with a copy of the notification and repayment. 4. Reportable Events under Section /11.G.J.c. For Reportable Events under Section IIl.G. l .c, the report to OIG shall include: a. the identity ofthe Ineligible Person and the job duties performed by that individual; b. the dates ofthe Ineligible Persons employment or contractual relationship; c. a description of the Exclusion List screening that Rhine Drug ·completed before and/or during the Ineligible Person's employment or contract and any flaw or breakdown in the screening process that led to the hiring or contracting with the Ineligible Person; d. a description of how the Ineligible Person was identified; and e. a description of any corrective action implemented to prevent future employment or contracting with an Ineligible Person. 5. Reportable Events under Section IIl.G.1.d. Ifthe Reportable Event involves the filing of a bankruptcy petition, the report to the 01G shall include 8 Rhine Drug Integrity Agreement documentation ofthe bankruptcy filing and a description of any Federal health care program requirements implicated. 6. Reportable Events Involving the Stark Law. Notwithstanding the reporting requirements outlined above, any Reportable Event that involves solely a probable violation ofsection 1877 of the Social Security Act, 42 U.S.C. §1395nn (the Stark law) should be submitted by Rhine Drug to CMS through the self-referral disclosure protocol (SRDP), with a copy to the OIG. IfRhine Drug identifies a probable violation ofthe Stark law and repays the applicable Overpayment directly to the CMS contractor, then Rhine Drug is not required by this Section III.F to submit the Reportable Event to CMS through the SRDP. IV. SUCCESSOR LIABILITY; CHANGES TO LOCATIONS OR BUSINESS; NEW EMPLOYMENT OR CONTRACTUAL ARRANGEMENT · A. Sales or Purchase of a Location or Business In the event that, after the Effective Date, Rhine Drug Company or Carter Clements proposes to (a) sell any or all of its locations or businesses that are subject to this IA (whether through a sale ofassets, a sale ofstock, or other type oftransaction), or (b) purchase or establish a new location or business related to the furnishing of items or services that may be reimbursed by any Federal health care program, the IA shall be binding on the purchaser ofany such location or business and any new location or business (and all Covered Persons at each new location or business) shall be subject to the requirements ofthis IA, unless otherwise determined and agreed to in writing by OIG. If, in advance ofa proposed sale or proposed purchase, Rhine Drug Company or Carter Clements wishes to obtain a determination by OIG that the proposed purchaser or the proposed acquisition will not be subject to the requirements ofthe IA, Rhine Drug Company or Carter Clements (as applicable) must notify OIG in writing ofthe proposed sale or purchase at least 30 days in advance. This notification shall include a description ofthe location or business to be sold or purchased, a brief description ofthe terms of the transaction and, in the case of a proposed sale, the name and contact information of the proposed purchaser. B. New Employment or Contractual Arrangement At least 30 days prior to Carter Clements becoming an employee or contractor with another party related to the furnishing ofitems or services that may be reimbursed by any Federal health care program, Carter Clements shall notify OIG ofhis plan to 9 Rhine Drug Integrity Agreement become an employee or contractor and must provide OIG with the name, location, status (employee or contractor) and an explanation of Carter Clements's responsibilities with respect to such potential employer or contractor. In addition, prior to Carter Clements becoming an employee or contractor with another party related to the furnishing ofitems or services that may be reimbursed by any Federal health care program, Carter Clements a shall notify that party of this IA. This notification shall include a copy of the IA and statement indicating the remaining term ofthe IA. The IA shall continue to apply to Carter Clements following the start of the new employment or contractual rela~ionship, unless otherwise agreed to in writing by the OIG. V. IMPLEMENTATION REPORT, IRO REPORTS AND ANNUAL REPORTS A. Implementation Report Within 90 days after the Effective Date; Rhine Drug shall submit a written report to OIG summarizing the status of its implementation of the requirements ofthis IA (Implementation Report). The Implementation Report shall, at a minimum, include: 1. a copy of the notice required by Section III.A, a description ofwhere the notice is posted, and the date the notice was posted; 2. the following information regarding the IRO: (a) identity, address, and phone number; (b) a copy of the engagement letter; ( c) information to demonstrate that the IRO has the qualifications outlined in Appendix A to this IA; and ( d) a certification from the IRO regarding its professional independence and objectivity with respect to Rhine Drug; 3. a copy ofthe search result print screens demonstrating that Rhine Drug has screened all Covered Persons against the Exclusion List, as required by section III.D, within 30 days ofthe Effective Date; 4. a list of all.of Rhine Drug's locations (including locations and mailing addresses), the corresponding name under which each location is doing business, and each location's Medicare and state Medicaid program provider number(s), and/or supplier number(s); and 5. a certification by Carter Clements that: (a) he or she has reviewed the IA in its entirety, understands the requirements described within, and maintains a 10 Rhine Drug Integrity Agreement