content: SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C.  20549
  
  
  
                                FORM 8-K
                             CURRENT REPORT 
  
  
      Pursuant to Section 13 or 15(d) of the Securities Exchange
                         Exchange Act of 1934
  
  
  
                      Date of Report: May 4, 1999
  
  
                      MAXICARE HEALTH PLANS, INC.
         (Exact name of registrant as specified in its charter)
  
  
  
      Delaware                  0-12024            95-3615709   
      (State or other        (Commission           (IRS Employer 
      jurisdiction of        File Number)          Identification No.)
      of incorporation)
                                                                    
  
  
                        1149 South Broadway Street
  
  
  
  
                          Los Angeles, California 
                  (Address of principal executive office)
                                   90015
                                (Zip Code) 
  
  
                           (213) 765-2000
         (Registrant's telephone number, including area code)
  
  
                           Not Applicable 
     (Former name or former address, if changed since last report)
  <PAGE>
   
  
  
  
  
  
  5. Other Events
  
  On April 16, 1999,  Maxicare  Health  Plans,  Inc. (the "Company") and
  Peter J. Ratican  ("Ratican"),  the  Company's  Chairman of the Board,
  President and  Chief  Executive  Officer  ("CEO")  announced  they had
  reached an agreement pursuant to  which  Ratican would be resigning as
  President and CEO  of  the  Company.  In  order  to  ensure an orderly
  transition, the  Company  and  Ratican  agreed  that such resignations
  would become effective on June  30, 1999 (the "Termination Date"). The
  Company's board of directors (the  "Board")  has formed a committee to
  identify an appropriate successor.  In addition, Ratican agreed not to
  stand for re-election to the Board  when  his term expires at the 1999
  Annual Meeting of Shareholders  which  is  scheduled for June 30, 1999
  (the "1999 Annual Meeting"). In connection with the foregoing, Ratican
  and the Company entered  into  a  Settlement Agreement dated April 16,
  1999 (the "Settlement Agreement"). The Settlement Agreement, which was
  negotiated between Ratican and representatives of the Board over a two
  month period, outlines the terms of the agreements between Ratican and
  the Company, including the amendment to Ratican's Employment Agreement
  and  certain  other  existing  agreements  and  the  terms  of  a  new
  consulting  agreement  (the   "Related  Agreements").  The  Settlement
  Agreement also provides on the  Effective Date, upon the occurrence of
  certain other events and subject  to certain limitations,  Ratican and
  the Company shall exchange  releases.  The Settlement Agreement became
  effective upon the expiration  of  Ratican's seven day recision period
  on April 24, 1999 (the  "Effective  Date"). On the Effective Date each
  of the Related Agreements  became  effective. The Settlement Agreement
  is attached hereto and made a part hereof as Exhibit 1.  
  
  In connection  with  the  Settlement  Agreement,  effective  as of the
  Effective Date, the Board agreed to nominate for re-election Thomas W.
  Field, Jr. and to nominate  for  election  as new directors, George H.
  Bigelow and Simon  Whitmey  (Messrs.  Bigelow  and Whitmey hereinafter
  referred to as the "New Directors")  for election for three year terms
  as directors at the 1999  Annual  Meeting. The New Directors will take
  the place of Mr.  Ratican  and  incumbent  director Alan S. Manne, who
  announced his retirement upon the  expiration  of his term at the 1999
  Annual Meeting. 
  
  Pursuant to the  Settlement  Agreement,  Ratican  and the Company have
  entered    into  a   four   year  non-exclusive  consulting  agreement
  commencing July  1,  1999  (  the  "Commencement  Date")  at an annual
  consulting fee of $500,000 (the "Consulting Fee") and the provision by
  the Company to Ratican of certain health and other benefits comparable
  to those currently  being  received  by  Ratican  under his Employment
  Agreement (the "Ratican Consulting Agreement"). The Ratican Consulting
  Agreement is attached hereto and made a part hereof as Exhibit 2.  The
  Ratican  Consulting  Agreement   provides  that  Ratican's  consulting
  services shall not interfere with his other business activities and he
  <PAGE>
  
  
  
  
  
  will be  free  to  engage  in  such  other  business  activities as he
  desires; provided,  however,  he  shall  be  prohibited from rendering
  services to an  HMO  competitor  of the Company in California, Indiana
  or  Louisiana  during  the  first   year  of  the  Ratican  Consulting
  Agreement. The Ratican Consulting Agreement is terminable prior to the
  Commencement Date under certain circumstances such as a termination of
  Ratican's Employment Agreement as a  result of his death or incapacity
  or for  "Cause",  as  defined  in  the  Employment  Agreement,  by the
  Company. After the Commencement Date, the Ratican Consulting Agreement
  may be terminated voluntarily by Ratican or for "Cause", as defined in
  the  Consulting  Agreement,  by  the  Company.    In  the  event  of a
  termination of the Consulting Agreement after the Commencement Date as
  a result of  Ratican's  death  or  incapacity,  Ratican  or his estate
  would receive the Consulting  Fee  due  for  the remainder of the four
  year   term.   The   Ratican   Consulting   Agreement   provides   for
  indemnification  by   the   Company   to   Ratican  under  appropriate
  circumstances and  the  advancement  of  legal  fees  and expenses for
  indemnification actions  and  in  the  event  of  a dispute thereunder
  subject to certain requirements. 
  
  If  the Company,  after  notice  and  time  to  cure, fails to pay the
  Ratican Consulting Fee  and  is  determined  to  be  in  breach of the
  Ratican Consulting Agreement  (a  "Company  Default"), (i) Ratican may
  terminate the  Ratican  Consulting  Agreement,  declare  the remaining
  balance due thereunder immediately  payable and receive the discounted
  value thereof; (ii)  the  Amended  Note (as defined below) will become
  non-recourse; and (iii) Ratican will continue to accrue benefits under
  the SERP (as defined below) through June 30, 2003. 
  
  To assist in the  transition,  Elwood  I.  Kleaver, Jr. ("Kleaver"), a
  current board member, has agreed to become the Company's Interim Chief
  Operating Officer  ("COO")  beginning  April  24,  1999  (the "Kleaver
  Commencement  Date")  pursuant  to  a  consulting  agreement  with the
  Company dated April  16,  1999  (the  "Kleaver Consulting Agreement").
  Under the Kleaver Consulting Agreement, Kleaver agrees to serve as COO
  for a period of  no  less  than  four  months  (the "Initial Term") at
  $40,000 per  month  (the  "Kleaver  Consulting  Fee").    Although the
  Kleaver Consulting Agreement is non-exclusive and Kleaver may continue
  and/or finish any of  his  existing consulting arrangements; Kleaver's
  other  consulting  services  may  not  materially  interfere  with the
  performance of his duties as COO. In addition,  during the term of the
  Kleaver  Consulting  Agreement,  Kleaver   may   not  enter  into  new
  consulting or  employment  agreements  without  prior  approval of the
  Board and will be  prohibited  from  working  for  a competitor of the
  Company in California, Indiana  and  Louisiana. The Kleaver Consulting
  Agreement may be terminated  (i)  upon  Kleaver's death or disability;
  (ii) for "Cause",  as  defined  in  the  Kleaver Consulting Agreement;
  (iii) for any reason other than  as  set  forth  in (i) or (ii) as set
  forth above or (iv)  after  August  24,  1999,  upon thirty days prior
  notice.  In the event of a termination of the Kleaver Consulting
  <PAGE>
  
  
  
  
  
  Agreement pursuant  to  (iii)  Kleaver  would  be  entitled to receive
  either the  unpaid  portion  of  the  Kleaver  Consulting  Fee for the
  Initial Term or if the termination is after the Initial Term, $40,000.
  The Kleaver Consulting  Agreement  is  attached hereto and made a part
  hereof as Exhibit 3. 
  
  Pursuant to the terms of the Kleaver Consulting Agreement, the Company
  has granted Kleaver, effective as  of  the Commencement Date,  options
  to purchase 50,000 shares of  the Company's common stock (the "Kleaver
  Options") pursuant to the Company's 1995 Stock Option Plan at $ 5.3125
  per share, the closing market  price  of the Company's common stock on
  the last trading day  immediately  preceding  the effectiveness of the
  option grant.  The Kleaver Options have  a ten year term and vest at a
  rate of 6,000  shares  per  month  during  the  Initial Term and 4,000
  shares per month thereafter.   All  vested options will be exercisable
  for a period of one year after the termination of Kleaver's consulting
  services to the Company (or employment by the Company, if applicable).
  The Stock Option  Agreement  between  Kleaver  and the Company setting
  forth the terms of the Kleaver  Options  is attached hereto and made a
  part hereof as Exhibit 4.
  
  In connection with the  Settlement  Agreement, Ratican and the Company
  have amended certain agreements between  them.  Effective on April 24,
  1999, Ratican and the Company entered into Amendment No. 4 ("Amendment
  No.4")  dated  April  16,  1999  to  Ratican's  Amended  and  Restated
  Employment Agreement, as amended (the "Employment Agreement") pursuant
  to  which  Ratican  and  the   Company  agreed:  (i)  to  shorten  the
  termination  date  of  such  agreement  from  April  1,  2001  to  the
  Termination Date; (ii) that  Ratican  would  no  longer be entitled to
  future or potential performance  bonuses, sales bonuses, severance pay
  upon the expiration of the term  of the Employment Agreement, or stock
  option grants under the terms  of the Employment Agreement; (iii) that
  during the period  from  the  Effective  Date  through the Termination
  Date, Ratican's powers and duties would be limited to those powers and
  duties  designated  by  the  Executive  Committee  of  the  Board (the
  "Executive  Committee");    and  (iv)  the  termination  of  Ratican's
  employment pursuant to Amendment No. 4 on the Termination Date and the
  election of the New  Directors  at  the  1999 Annual Meeting would not
  trigger any payments to Ratican as  a result of a "Change of Control",
  as such term is defined  in  Amendment  No. 4. Amendment No. 4 between
  Ratican and the Company is attached  hereto  and made a part hereof as
  Exhibit 5. 
  
  In connection with the Settlement  Agreement, as of the Effective Date
  adjustments were also made to Ratican's outstanding option agreements.
  Ratican's Senior Executives Stock  Option  Agreement (the "1996 Option
  Agreement") with respect to options  granted under the Maxicare Health
  Plans, Inc. Senior Executives 1996 Stock Option Plan (the "1996 Option
  Plan") was amended  so  that:  (i)  the  term  of  the options granted
  thereunder (the "1996 Plan Options") was shortened to January 1, 2005
  <PAGE>
  
  
  
  
  
  (the "Option Term"); (ii) the exercise price of the options granted on
  July 26, 1996, January 1,  1997  and  January 1, 1998 was reduced from
  $14.75, $22.25 and 10.88, respectively,  to $7.2875 or $1.875 over the
  average closing trading price of  the Company's common stock price for
  April 19, 1999 through April 23,  1999  or $5.4125  and (iii) the 1996
  Plan  Options  would  remain  exercisable  through  the  Option  Term,
  notwithstanding  the  termination  of  Ratican's  employment  with the
  Company  or  the  termination  of  the  Ratican  Consulting Agreement.
  Amendment No.1 dated  April  16,  1999  to  the  1996 Option Agreement
  between Ratican  and  the  Company  dated  as  of  April  1,  1996 and
  Amendment Number Two dated  April  16,  1999  to the 1996 Option Plan,
  which reflect the  foregoing,  are  attached  hereto  and  made a part
  hereof as Exhibits  6  and  7,  respectively.  In  addition, as of the
  Effective Date, the Company and  Ratican  entered into Amendment No. 2
  dated April 16, 1999 ("Amendment No.  2 to the 1989 Option Agreement")
  to the option agreement dated as  of  August 31, 1989, as amended (the
  "1989 Option Agreement") pursuant  to  which the 1989 Option Agreement
  was amended  to  extend  Ratican's  ability  to  exercise  the options
  granted thereunder ("the 1989  Plan  Options")  until December 5, 2000
  (the original option term  of  the  1989  Plan  Options under the 1989
  Option  Agreement),  notwithstanding   the  termination  of  Ratican's
  employment with the Company on the  Termination Date.  Amendment No. 2
  to the 1989 Option Agreement is attached hereto and made a part hereof
  as Exhibit 8. 
  
  In connection with the Settlement Agreement, as of the Effective Date,
  the terms of the  Maxicare  Health  Plans, Inc. Supplemental Executive
  Retirement  Plan  (the  "SERP")  were  amended  so  that  Ratican will
  continue to accrue benefits  under  the  SERP  during  the term of the
  Ratican Consulting Agreement. Amendment No.  3 to the SERP dated April
  16, 1999  is attached hereto and made a part hereof as Exhibit 9. 
  
  As of the Effective  Date,  Ratican's  promissory note in the original
  principal amount  of  $2,229,028.13,  (the  "Original  Balance") dated
  February 18, 1997, and related  loan  documents (the "1997 Note") were
  also amended.   Pursuant  to  the  terms  of  the Amended and Restated
  Promissory Note dated April  16,  1999  (the "Restated 1997 Note") the
  term of the 1997 Note was extended from April 1, 2001 to June 30, 2003
  (the "Maturity Date").  In  addition,  the Restated 1997 Note provides
  that on the Maturity Date, in  lieu of payment of the Original Balance
  and all accrued interest  thereon  (the  "Maturity Balance"),  Ratican
  may fully satisfy  his  obligations  under  the  1997 Note through the
  payment to the Company for payment to the applicable state and Federal
  tax authorities the applicable  minimum  state and federal withholding
  amounts and FICA taxes due  from  Ratican resulting from the reduction
  of the Maturity Balance  to  zero  (the "Applicable Taxes"); provided,
  however, in the event  the  Ratican Consulting Agreement is terminated
  for Cause or voluntarily by Ratican or Ratican fails to timely pay the
  Applicable Taxes,  the  Restated  1997  Note  provides  that  the full
  Maturity Balance will remain due. The Restated 1997 Note also provides
  <PAGE>
  
  
  
  
  
  that Ratican may withdraw,  at  any  time,  all  or any portion of the
  150,000 shares of the Company's  common  stock  held by the Company as
  collateral under  the  Note  and  substitute  in  lieu  thereof, cash,
  treasury notes, U.S. government  backed securities or other collateral
  acceptable  to  Maxicare  valued  at  not  less  than  $800,000.    As
  previously discussed, the Restated 1997 Note becomes non-recourse upon
  the occurrence  of  a  Company  Default  under  the Ratican Consulting
  Agreement.  The Restated 1997 Note, Amendment One dated April 16, 1999
  to the Loan Agreement between  the  Company and Ratican dated February
  18, 1997  and  Amendment  One  dated  April  16,  1999  to  the Pledge
  Agreement between the  Company  and  Ratican  dated  February 18, 1997
  effectuating the foregoing are attached  hereto and made a part hereof
  as Exhibits 10, 11  and  12,  respectively.     In connection with the
  Ratican Settlement  Agreement,  the  Company  also cancelled Ratican's
  promissory note in the amount of $143,118, dated July 1998.
  
  Item 7.  Financial Statements and  Exhibits.
  
            (b) Exhibits. 
  
  
       10.3l    1.  The Settlement and  Release Agreement between
                    Peter   J.  Ratican  ("Ratican") and Maxicare
                    Health    Plans,    Inc.    (the   "Company")
                    dated April 16, 1999;
  
       10.3m    2.  The Consulting Agreement  between Ratican and
                    the Company dated April 16, 1999;
  
       10.91    3.  The Consulting  Agreement  between  Elwood I.
                    Kleaver,  Jr.  ("Kleaver")  and  the  Company
                    dated April 16, 1999; 
  
       10.91a   4.  Stock Option  Agreement  between  Kleaver and
                    the Company dated April 16, 1999; 
  
       10.3n    5.  Amendment No. 4 dated  April  16, 1999 to the
                    Amended   and    Restated    Employment   and
                    Indemnification       Agreement       between
                    Ratican and the Company  dated as of April 1,
                    1996;
  
       10.82c   6.  Amendment No. 1 dated  April  16, 1999 to the
                    Stock Option  Agreement  between  Ratican and
                    the Company dated April 1, 1996;
  
       10.84b   7.  Amendment Number Two dated  April 16, 1999 to
                    the  Maxicare   Health   Plans,  Inc.  Senior
                    Executives 1996 Stock Option Plan;
  <PAGE>
  
  
  
  
  
  
       10.14b   8.  Amendment No. 2 dated  April  16, 1999 to the
                    Stock Option  Agreement  between  Ratican and
                    the     Company      dated     August     31,
                    1989;
  
       10.87c   9.  Amendment No. 3 dated  April  16, 1999 to the
                    Supplemental Executive Retirement Plan;
  
       10.3o    10. Ratican's   Amended   and   Restated  Secured
                    Promissory Note dated April 16, 1999;
  
       10.3p    11. Amendment One  dated  April  16,  1999 to the
                    Loan  Agreement   between   Ratican  and  the
                    Company dated February 18, 1997; and
  
       10.3q    12. Amendment One  dated  April  16,  1999 to the
                    Pledge  Agreement  between  Ratican  and  the
                    Company dated February 18, 1997.
  
       99.10    13. Press Release dated April 19, 1999 announcing
                    management transition and Board changes.
  <PAGE>
  
  
  
  
  
  
  
  
                             SIGNATURES
  
             Pursuant to the requirements of the Securities and Exchange
  Act of 1934, the Registrant has  duly  caused this report to be signed
  on its behalf by the undersigned hereunto duly authorized.
  
  
                                  MAXICARE HEALTH PLANS, INC. 
                                  (Registrant)
  
  
  Date:  May 4, 1999              By:     /s/ Richard A. Link      
                                          Richard A. Link
                                      Chief Financial Officer
metadata_documents: [{"type": "8-K", "sequence": "1", "description": "FORM 8-K", "secsgml_size_bytes": 18186}]
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text: SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C.  20549
  
                                FORM 8-K
                             CURRENT REPORT 
  
      Pursuant to Section 13 or 15(d) of the Securities Exchange
                         Exchange Act of 1934
  
                      Date of Report: May 4, 1999
  
                      MAXICARE HEALTH PLANS, INC.
         (Exact name of registrant as specified in its charter)
  
      Delaware                  0-12024            95-3615709   
      (State or other        (Commission           (IRS Employer 
      jurisdiction of        File Number)          Identification No.)
      of incorporation)
                                                                    
  
                        1149 South Broadway Street
  
                          Los Angeles, California 
                  (Address of principal executive office)
                                   90015
                                (Zip Code) 
  
                           (213) 765-2000
         (Registrant's telephone number, including area code)
  
                           Not Applicable 
     (Former name or former address, if changed since last report)
  5. Other Events
  
  On April 16, 1999,  Maxicare  Health  Plans,  Inc. (the "Company") and
  Peter J. Ratican  ("Ratican"),  the  Company's  Chairman of the Board,
  President and  Chief  Executive  Officer  ("CEO")  announced  they had
  reached an agreement pursuant to  which  Ratican would be resigning as
  President and CEO  of  the  Company.  In  order  to  ensure an orderly
  transition, the  Company  and  Ratican  agreed  that such resignations
  would become effective on June  30, 1999 (the "Termination Date"). The
  Company's board of directors (the  "Board")  has formed a committee to
  identify an appropriate successor.  In addition, Ratican agreed not to
  stand for re-election to the Board  when  his term expires at the 1999
  Annual Meeting of Shareholders  which  is  scheduled for June 30, 1999
  (the "1999 Annual Meeting"). In connection with the foregoing, Ratican
  and the Company entered  into  a  Settlement Agreement dated April 16,
  1999 (the "Settlement Agreement"). The Settlement Agreement, which was
  negotiated between Ratican and representatives of the Board over a two
  month period, outlines the terms of the agreements between Ratican and
  the Company, including the amendment to Ratican's Employment Agreement
  and  certain  other  existing  agreements  and  the  terms  of  a  new
  consulting  agreement  (the   "Related  Agreements").  The  Settlement
  Agreement also provides on the  Effective Date, upon the occurrence of
  certain other events and subject  to certain limitations,  Ratican and
  the Company shall exchange  releases.  The Settlement Agreement became
  effective upon the expiration  of  Ratican's seven day recision period
  on April 24, 1999 (the  "Effective  Date"). On the Effective Date each
  of the Related Agreements  became  effective. The Settlement Agreement
  is attached hereto and made a part hereof as Exhibit 1.  
  
  In connection  with  the  Settlement  Agreement,  effective  as of the
  Effective Date, the Board agreed to nominate for re-election Thomas W.
  Field, Jr. and to nominate  for  election  as new directors, George H.
  Bigelow and Simon  Whitmey  (Messrs.  Bigelow  and Whitmey hereinafter
  referred to as the "New Directors")  for election for three year terms
  as directors at the 1999  Annual  Meeting. The New Directors will take
  the place of Mr.  Ratican  and  incumbent  director Alan S. Manne, who
  announced his retirement upon the  expiration  of his term at the 1999
  Annual Meeting. 
  
  Pursuant to the  Settlement  Agreement,  Ratican  and the Company have
  entered    into  a   four   year  non-exclusive  consulting  agreement
  commencing July  1,  1999  (  the  "Commencement  Date")  at an annual
  consulting fee of $500,000 (the "Consulting Fee") and the provision by
  the Company to Ratican of certain health and other benefits comparable
  to those currently  being  received  by  Ratican  under his Employment
  Agreement (the "Ratican Consulting Agreement"). The Ratican Consulting
  Agreement is attached hereto and made a part hereof as Exhibit 2.  The
  Ratican  Consulting  Agreement   provides  that  Ratican's  consulting
  services shall not interfere with his other business activities and he
  will be  free  to  engage  in  such  other  business  activities as he
  desires; provided,  however,  he  shall  be  prohibited from rendering
  services to an  HMO  competitor  of the Company in California, Indiana
  or  Louisiana  during  the  first   year  of  the  Ratican  Consulting
  Agreement. The Ratican Consulting Agreement is terminable prior to the
  Commencement Date under certain circumstances such as a termination of
  Ratican's Employment Agreement as a  result of his death or incapacity
  or for  "Cause",  as  defined  in  the  Employment  Agreement,  by the
  Company. After the Commencement Date, the Ratican Consulting Agreement
  may be terminated voluntarily by Ratican or for "Cause", as defined in
  the  Consulting  Agreement,  by  the  Company.    In  the  event  of a
  termination of the Consulting Agreement after the Commencement Date as
  a result of  Ratican's  death  or  incapacity,  Ratican  or his estate
  would receive the Consulting  Fee  due  for  the remainder of the four
  year   term.   The   Ratican   Consulting   Agreement   provides   for
  indemnification  by   the   Company   to   Ratican  under  appropriate
  circumstances and  the  advancement  of  legal  fees  and expenses for
  indemnification actions  and  in  the  event  of  a dispute thereunder
  subject to certain requirements. 
  
  If  the Company,  after  notice  and  time  to  cure, fails to pay the
  Ratican Consulting Fee  and  is  determined  to  be  in  breach of the
  Ratican Consulting Agreement  (a  "Company  Default"), (i) Ratican may
  terminate the  Ratican  Consulting  Agreement,  declare  the remaining
  balance due thereunder immediately  payable and receive the discounted
  value thereof; (ii)  the  Amended  Note (as defined below) will become
  non-recourse; and (iii) Ratican will continue to accrue benefits under
  the SERP (as defined below) through June 30, 2003. 
  
  To assist in the  transition,  Elwood  I.  Kleaver, Jr. ("Kleaver"), a
  current board member, has agreed to become the Company's Interim Chief
  Operating Officer  ("COO")  beginning  April  24,  1999  (the "Kleaver
  Commencement  Date")  pursuant  to  a  consulting  agreement  with the
  Company dated April  16,  1999  (the  "Kleaver Consulting Agreement").
  Under the Kleaver Consulting Agreement, Kleaver agrees to serve as COO
  for a period of  no  less  than  four  months  (the "Initial Term") at
  $40,000 per  month  (the  "Kleaver  Consulting  Fee").    Although the
  Kleaver Consulting Agreement is non-exclusive and Kleaver may continue
  and/or finish any of  his  existing consulting arrangements; Kleaver's
  other  consulting  services  may  not  materially  interfere  with the
  performance of his duties as COO. In addition,  during the term of the
  Kleaver  Consulting  Agreement,  Kleaver   may   not  enter  into  new
  consulting or  employment  agreements  without  prior  approval of the
  Board and will be  prohibited  from  working  for  a competitor of the
  Company in California, Indiana  and  Louisiana. The Kleaver Consulting
  Agreement may be terminated  (i)  upon  Kleaver's death or disability;
  (ii) for "Cause",  as  defined  in  the  Kleaver Consulting Agreement;
  (iii) for any reason other than  as  set  forth  in (i) or (ii) as set
  forth above or (iv)  after  August  24,  1999,  upon thirty days prior
  notice.  In the event of a termination of the Kleaver Consulting
  Agreement pursuant  to  (iii)  Kleaver  would  be  entitled to receive
  either the  unpaid  portion  of  the  Kleaver  Consulting  Fee for the
  Initial Term or if the termination is after the Initial Term, $40,000.
  The Kleaver Consulting  Agreement  is  attached hereto and made a part
  hereof as Exhibit 3. 
  
  Pursuant to the terms of the Kleaver Consulting Agreement, the Company
  has granted Kleaver, effective as  of  the Commencement Date,  options
  to purchase 50,000 shares of  the Company's common stock (the "Kleaver
  Options") pursuant to the Company's 1995 Stock Option Plan at $ 5.3125
  per share, the closing market  price  of the Company's common stock on
  the last trading day  immediately  preceding  the effectiveness of the
  option grant.  The Kleaver Options have  a ten year term and vest at a
  rate of 6,000  shares  per  month  during  the  Initial Term and 4,000
  shares per month thereafter.   All  vested options will be exercisable
  for a period of one year after the termination of Kleaver's consulting
  services to the Company (or employment by the Company, if applicable).
  The Stock Option  Agreement  between  Kleaver  and the Company setting
  forth the terms of the Kleaver  Options  is attached hereto and made a
  part hereof as Exhibit 4.
  
  In connection with the  Settlement  Agreement, Ratican and the Company
  have amended certain agreements between  them.  Effective on April 24,
  1999, Ratican and the Company entered into Amendment No. 4 ("Amendment
  No.4")  dated  April  16,  1999  to  Ratican's  Amended  and  Restated
  Employment Agreement, as amended (the "Employment Agreement") pursuant
  to  which  Ratican  and  the   Company  agreed:  (i)  to  shorten  the
  termination  date  of  such  agreement  from  April  1,  2001  to  the
  Termination Date; (ii) that  Ratican  would  no  longer be entitled to
  future or potential performance  bonuses, sales bonuses, severance pay
  upon the expiration of the term  of the Employment Agreement, or stock
  option grants under the terms  of the Employment Agreement; (iii) that
  during the period  from  the  Effective  Date  through the Termination
  Date, Ratican's powers and duties would be limited to those powers and
  duties  designated  by  the  Executive  Committee  of  the  Board (the
  "Executive  Committee");    and  (iv)  the  termination  of  Ratican's
  employment pursuant to Amendment No. 4 on the Termination Date and the
  election of the New  Directors  at  the  1999 Annual Meeting would not
  trigger any payments to Ratican as  a result of a "Change of Control",
  as such term is defined  in  Amendment  No. 4. Amendment No. 4 between
  Ratican and the Company is attached  hereto  and made a part hereof as
  Exhibit 5. 
  
  In connection with the Settlement  Agreement, as of the Effective Date
  adjustments were also made to Ratican's outstanding option agreements.
  Ratican's Senior Executives Stock  Option  Agreement (the "1996 Option
  Agreement") with respect to options  granted under the Maxicare Health
  Plans, Inc. Senior Executives 1996 Stock Option Plan (the "1996 Option
  Plan") was amended  so  that:  (i)  the  term  of  the options granted
  thereunder (the "1996 Plan Options") was shortened to January 1, 2005
  (the "Option Term"); (ii) the exercise price of the options granted on
  July 26, 1996, January 1,  1997  and  January 1, 1998 was reduced from
  $14.75, $22.25 and 10.88, respectively,  to $7.2875 or $1.875 over the
  average closing trading price of  the Company's common stock price for
  April 19, 1999 through April 23,  1999  or $5.4125  and (iii) the 1996
  Plan  Options  would  remain  exercisable  through  the  Option  Term,
  notwithstanding  the  termination  of  Ratican's  employment  with the
  Company  or  the  termination  of  the  Ratican  Consulting Agreement.
  Amendment No.1 dated  April  16,  1999  to  the  1996 Option Agreement
  between Ratican  and  the  Company  dated  as  of  April  1,  1996 and
  Amendment Number Two dated  April  16,  1999  to the 1996 Option Plan,
  which reflect the  foregoing,  are  attached  hereto  and  made a part
  hereof as Exhibits  6  and  7,  respectively.  In  addition, as of the
  Effective Date, the Company and  Ratican  entered into Amendment No. 2
  dated April 16, 1999 ("Amendment No.  2 to the 1989 Option Agreement")
  to the option agreement dated as  of  August 31, 1989, as amended (the
  "1989 Option Agreement") pursuant  to  which the 1989 Option Agreement
  was amended  to  extend  Ratican's  ability  to  exercise  the options
  granted thereunder ("the 1989  Plan  Options")  until December 5, 2000
  (the original option term  of  the  1989  Plan  Options under the 1989
  Option  Agreement),  notwithstanding   the  termination  of  Ratican's
  employment with the Company on the  Termination Date.  Amendment No. 2
  to the 1989 Option Agreement is attached hereto and made a part hereof
  as Exhibit 8. 
  
  In connection with the Settlement Agreement, as of the Effective Date,
  the terms of the  Maxicare  Health  Plans, Inc. Supplemental Executive
  Retirement  Plan  (the  "SERP")  were  amended  so  that  Ratican will
  continue to accrue benefits  under  the  SERP  during  the term of the
  Ratican Consulting Agreement. Amendment No.  3 to the SERP dated April
  16, 1999  is attached hereto and made a part hereof as Exhibit 9. 
  
  As of the Effective  Date,  Ratican's  promissory note in the original
  principal amount  of  $2,229,028.13,  (the  "Original  Balance") dated
  February 18, 1997, and related  loan  documents (the "1997 Note") were
  also amended.   Pursuant  to  the  terms  of  the Amended and Restated
  Promissory Note dated April  16,  1999  (the "Restated 1997 Note") the
  term of the 1997 Note was extended from April 1, 2001 to June 30, 2003
  (the "Maturity Date").  In  addition,  the Restated 1997 Note provides
  that on the Maturity Date, in  lieu of payment of the Original Balance
  and all accrued interest  thereon  (the  "Maturity Balance"),  Ratican
  may fully satisfy  his  obligations  under  the  1997 Note through the
  payment to the Company for payment to the applicable state and Federal
  tax authorities the applicable  minimum  state and federal withholding
  amounts and FICA taxes due  from  Ratican resulting from the reduction
  of the Maturity Balance  to  zero  (the "Applicable Taxes"); provided,
  however, in the event  the  Ratican Consulting Agreement is terminated
  for Cause or voluntarily by Ratican or Ratican fails to timely pay the
  Applicable Taxes,  the  Restated  1997  Note  provides  that  the full
  Maturity Balance will remain due. The Restated 1997 Note also provides
  that Ratican may withdraw,  at  any  time,  all  or any portion of the
  150,000 shares of the Company's  common  stock  held by the Company as
  collateral under  the  Note  and  substitute  in  lieu  thereof, cash,
  treasury notes, U.S. government  backed securities or other collateral
  acceptable  to  Maxicare  valued  at  not  less  than  $800,000.    As
  previously discussed, the Restated 1997 Note becomes non-recourse upon
  the occurrence  of  a  Company  Default  under  the Ratican Consulting
  Agreement.  The Restated 1997 Note, Amendment One dated April 16, 1999
  to the Loan Agreement between  the  Company and Ratican dated February
  18, 1997  and  Amendment  One  dated  April  16,  1999  to  the Pledge
  Agreement between the  Company  and  Ratican  dated  February 18, 1997
  effectuating the foregoing are attached  hereto and made a part hereof
  as Exhibits 10, 11  and  12,  respectively.     In connection with the
  Ratican Settlement  Agreement,  the  Company  also cancelled Ratican's
  promissory note in the amount of $143,118, dated July 1998.
  
  Item 7.  Financial Statements and  Exhibits.
  
            (b) Exhibits. 
  
       10.3l    1.  The Settlement and  Release Agreement between
                    Peter   J.  Ratican  ("Ratican") and Maxicare
                    Health    Plans,    Inc.    (the   "Company")
                    dated April 16, 1999;
  
       10.3m    2.  The Consulting Agreement  between Ratican and
                    the Company dated April 16, 1999;
  
       10.91    3.  The Consulting  Agreement  between  Elwood I.
                    Kleaver,  Jr.  ("Kleaver")  and  the  Company
                    dated April 16, 1999; 
  
       10.91a   4.  Stock Option  Agreement  between  Kleaver and
                    the Company dated April 16, 1999; 
  
       10.3n    5.  Amendment No. 4 dated  April  16, 1999 to the
                    Amended   and    Restated    Employment   and
                    Indemnification       Agreement       between
                    Ratican and the Company  dated as of April 1,
                    1996;
  
       10.82c   6.  Amendment No. 1 dated  April  16, 1999 to the
                    Stock Option  Agreement  between  Ratican and
                    the Company dated April 1, 1996;
  
       10.84b   7.  Amendment Number Two dated  April 16, 1999 to
                    the  Maxicare   Health   Plans,  Inc.  Senior
                    Executives 1996 Stock Option Plan;
  10.14b   8.  Amendment No. 2 dated  April  16, 1999 to the
                    Stock Option  Agreement  between  Ratican and
                    the     Company      dated     August     31,
                    1989;
  
       10.87c   9.  Amendment No. 3 dated  April  16, 1999 to the
                    Supplemental Executive Retirement Plan;
  
       10.3o    10. Ratican's   Amended   and   Restated  Secured
                    Promissory Note dated April 16, 1999;
  
       10.3p    11. Amendment One  dated  April  16,  1999 to the
                    Loan  Agreement   between   Ratican  and  the
                    Company dated February 18, 1997; and
  
       10.3q    12. Amendment One  dated  April  16,  1999 to the
                    Pledge  Agreement  between  Ratican  and  the
                    Company dated February 18, 1997.
  
       99.10    13. Press Release dated April 19, 1999 announcing
                    management transition and Board changes.
  SIGNATURES
  
             Pursuant to the requirements of the Securities and Exchange
  Act of 1934, the Registrant has  duly  caused this report to be signed
  on its behalf by the undersigned hereunto duly authorized.
  
                                  MAXICARE HEALTH PLANS, INC. 
                                  (Registrant)
  
  Date:  May 4, 1999              By:     /s/ Richard A. Link      
                                          Richard A. Link
                                      Chief Financial Officer