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Health Care Transactions Addendum to Paymode-X® Operating Rules

This Health Care Transactions Addendum to the Paymode-X Operating Rules (this "Addendum") shall apply to each Network Member that uses the Paymode-X Processing Services to send or receive either an Electronic Funds Transfer order, or an Electronic Remittance Advice, or both, in connection with the conduct of any Transactions, all as defined herein. The Parties hereby agree to the following terms and conditions with respect to all Transactions:

I. Definitions

A. Agreement:

The Network Member's Agreement and the Operating Rules, including all exhibits, attachments, and amendments thereto, each as amended from time to time.

B. Business Associate:

Business Associate shall have the meaning set forth in 45 C.F.R. § 160.103.

C. Electronic Funds Transfer, or "EFT":

A DPA sent by a Disburser as part of a Transaction.

D. Electronic Remittance Advice, or "ERA":

Information on the disposition of a health care claim made to a Disburser for payment (including, without limitation, a provider name, patient name, date of service, amount billed, amount allowed, and reason for any claim denial) sent, received, or created as part of a Transaction.

E. Health Care Clearinghouse:

Health Care Clearinghouse shall have the meaning set forth in 45 C.F.R. § 160.103.

F. Identified Transaction:

Identified Transaction shall have the meaning set forth in Section II(A) hereof.

G. Nonstandard Format:

A Transaction format that does not comply with the Standards.

H. Protected Health Information:

Protected Health Information shall have the meaning set forth in 45 C.F.R. § 160.103.

I. Standards:

The standard(s) adopted by the Secretary of the U.S. Department of Health and Human Services for Transactions in accordance with 45 C.F.R. Part 162, Subpart P.

J. Transaction:

Health Care Payment and Remittance Advice transaction, as defined in 45 C.F.R. Part 162, Subpart P.

K. Transaction Account Information:

The bank account number and routing transit number of a Collector's Transaction Account(s), and the Employer Identification Number of the Collector.

L. Transaction Reference:

A Reassociation Trace Number or trace segment included in a Transaction as part of an Automated Clearinghouse Network CCD+ record, or any similar reassociation trace number associated with a file form other than CCD+ (e.g., CTX). A Transaction Reference shall include the payment reference number supplied by Disburser or, in the absence of such a payment reference number, the DPA number assigned by Paymode-X.


Any capitalized terms used, but not otherwise defined, in this Addendum shall have the same meaning as those terms have under the Operating Rules.

II. Obligations of the Parties

A. Identification and Transmission of Transactions:

The Parties acknowledge that Paymode-X is not responsible for ascertaining whether any EFTs or ERAs must comply with the Standards. Disburser shall therefore identify, by a code, file format, or other signal, as determined by the Parties, each Transaction that Disburser intends to conduct through use of the Processing Services in accordance with the Standards (each an "Identified Transaction"). With respect to each Identified Transaction, Paymode-X shall (1) apply any edits needed to ensure that the appropriate Collector or its designee can receive, upon request, an EFT and/or ERA, including a Transaction Reference, (i) in a format that complies with the Standards and (ii) in any other Nonstandard Format mutually agreed upon by Paymode-X and the Collector, or, (2)  if Paymode-X has insufficient data to conform the Identified Transaction to the Standards, notify the Disburser that the Identified Transaction has been rejected, in which case Paymode-X shall have no further responsibilities with respect to such Identified Transaction.

B. Nonstandard Format:

(i) If a Collector has requested, and Paymode-X has agreed to provide, any Identified Transaction (or any portion thereof) in a Nonstandard Format, the Parties acknowledge that Paymode-X is a Business Associate of such Collector and acts as a Health Care Clearinghouse for such Collector.

(ii) If Paymode-X has agreed to accept from a Disburser any Identified Transaction (or any portion thereof) in a Nonstandard Format, the Parties acknowledge that Paymode-X is a Business Associate of such Disburser and acts as a Health Care Clearinghouse for such Disburser.

C. Privacy, Security, and Standards:

Disburser is solely responsible for the privacy and security of any data, including, but not limited to, Protected Health Information and any Transaction Account Information, maintained or made available by Disburser, except for data maintained by Paymode-X expressly for Disburser. Except as required by applicable law or contract, Paymode-X is not responsible for protecting the privacy or security of any Protected Health Information disclosed to Paymode-X in connection with any Transaction, provided, however, that Paymode-X shall protect, in accordance with and to the extent required by the Health Care Information Privacy Addendum to the Operating Rules, Protected Health Information received by Paymode-X as part of the ERA component of any Identified Transaction. Except as required by applicable law, Paymode-X is not responsible for ensuring compliance with the Standards of any transaction except as set forth in subsection II.A above for an Identified Transaction.

D. EFT-Only Disbursers:

If Disburser transmits no ERAs through the Network in connection with an Identified Transaction, the following additional terms apply:

(i) If requested by Disburser and permitted by Section II(D)(ii) hereof, Paymode-X will provide to Disburser Collector's Transaction Account Information for each Identified Transaction.

(ii) The Parties acknowledge that Paymode-X protects Network Members’ confidentiality and does not release a Network Member's Transaction Account Information without the Network Member’s consent. Paymode-X shall disclose a Collector's Transaction Account Information to a Disburser only if such Collector has agreed to such disclosure in accordance with Section II(E) of this Addendum. Paymode-X makes no representations or warranties with respect to the accuracy of the Transaction Account information provided to Disburser pursuant to this Section II(D)(ii).

(iii) Paymode-X is not responsible for providing, and shall not be liable for failing to provide, an ERA or similar information from Disburser to any Client or third party.

E. Disclosure of Transaction Account Information:

If the Network Member is enrolled as a Collector and receives an EFT through Paymode-X with respect to which the Disburser will provide an ERA through another source, the Network Member authorizes Paymode-X to release to such Disburser the Transaction Account Information required to allow the Disburser to prepare and deliver an ERA that complies with the Standards.

F. Indemnification:

In addition to the indemnification obligations set forth in the Agreement, you specifically agree to indemnify and hold harmless Paymode-X and its affiliates, officers, directors, employees and agents from and against any claim or damages (including attorney fees) arising directly or indirectly from our processing of any Transaction, including our handling of any EFT or ERA, unless and to the extent that the claim or damages arise out of Paymode-X's failure to perform its obligations in a manner that would subject us to liability for a breach of our obligations as set forth in this Addendum.

III. Terms and Termination

A. Term:

The term of this Addendum shall begin on October 16, 2003 (the "Effective Date") and shall continue until terminated in accordance with Section III(B) hereof.

B. Termination:

Automatically: This Addendum shall terminate automatically upon termination of the Agreement or termination of the Network Member's use of the Processing Services.

(i) For Cause: Either party may terminate this Addendum for a material breach by the other party if such breach is not cured within thirty (30) days of receipt of written notice thereof.

IV. General Provisions

A. Amendment:

Paymode-X shall amend this Addendum as necessary to ensure that the Parties comply with regulations governing the privacy, security, and format of the Transactions. Paymode-X will prepare any necessary amendment(s) to this Addendum and provide it/them to applicable Network Members by means of an e-mail notice to such Network Members highlighting the changes and by posting the changes at The Parties agree that such amendment shall be deemed effective immediately upon receipt of such e-mail notice by the Network Member, or upon such later date as shall be specified in the notice or in the amendment itself.

B. Entire Agreement:

This Addendum, together with the Agreement and Operating Rules, constitute the entire agreement between the Parties concerning the subject matter hereof, and supersede all prior oral and/or written agreements between the Parties relating thereto. If there is a conflict between this Addendum and any other provision(s) of the Agreement or Operating Rules, the terms of this Addendum shall prevail.

C. Governing Law:

This Addendum is governed by and interpreted according to (i) U.S. federal law and (ii) the law of the State of New York, without reference to the principles of conflicts of law of the U.S. and of such state.

D. Regulatory References:

A reference in this Addendum to a section or subpart of any regulation shall mean that section or subpart as in effect from time to time.

E. Survival:

The obligations of the Parties under Section II(F) of this Addendum shall survive the termination of this Addendum indefinitely.

F. Third-Party Beneficiaries:

There are no third-party beneficiaries of this Addendum and no other person or entity shall have rights arising from the same.

Version 2.0 (9/2009)