AETNA SELLS PITTSBURGH HMO TO COVENTRY.

NASHVILLE, Tenn.--(BUSINESS WIRE)--Dec. 19, 1995--Combining their strong managed health care presence in the Pittsburgh market, Aetna Health Plans (AHP) and Coventry Corporation (Nasdaq/NM:CVTY) agreed to an arrangement under which Coventry will acquire PARTNERS Health Plan of Pennsylvania, Inc., including AHP's 81 percent ownership interest.

The agreement is subject to certain closing conditions, including regulatory approval. PARTNERS is the holding company for Aetna Health Plans of Western Pennsylvania, Inc., which serves 16,400 HMO members in the Pittsburgh area.

AHP will continue to offer the HMO, which is fully accredited by the National Committee for Quality Assurance (NCQA), to Pittsburgh-based employees of its multisite customers.

AHP and Coventry are also exploring the formation of a joint marketing arrangement to provide managed health care services to multisite customers with headquarters in Pittsburgh. This agreement would combine the strengths of Coventry's local Pittsburgh managed care business and AHP's managed care capabilities in many markets across the United States.

"We welcome the additional 16,400 members to our health plan," said Larry Kugelman, Coventry's president and chief executive officer. "We're gratified to have been chosen by one of the nation's leading health plans to provide the best possible service to its customers. Clearly, our success in the Pittsburgh market was a compelling factor in AHP selecting our company to participate in this important strategic alliance."

Allen Maltz, senior vice president of AHP, said, "AHP's goal is to be one of the top three players in each of the markets in which we compete. In Pittsburgh, we did not see the opportunity to achieve a top three position in the near term. We had a relatively small HMO presence in Pittsburgh and felt that our best approach would be to collaborate with a strong local HMO like Coventry that shares our commitment to quality and dedication to customer service."

After the acquisition of AHP's shares is completed, Coventry will effect the buyout of the remaining 19 percent of PARTNERS' common stock at the same per-share price of approximately $5,275. Those shares are owned by a group of Pittsburgh-area physicians.

HealthAmerica Pennsylvania, Coventry's Pittsburgh HMO, administers managed care benefits for more than 400,000 members in Pennsylvania, including more than 250,000 in southwestern Pennsylvania. Coventry, based in Nashville, Tennessee, is a managed health care company that provides a wide range of health benefits and services to a broad cross-section of employer and government-funded groups in Pennsylvania, Ohio, West Virginia, Missouri, Illinois, Virginia and Florida. The company operates from regional headquarters in Pittsburgh and Harrisburg, Pennsylvania; St. Louis, Missouri; Richmond, Virginia; and Jacksonville, Florida.

Aetna Health Plans is one of the country's leading managed health care companies. In addition to providing health care coverage through health maintenance organizations, preferred provider organizations, point-of-service plans and traditional fee- for-service plans, AHP also offers specialty health and group insurance products. In total, AHP products and services reach more than 20 million Americans in over 200 markets.

CONTACT: Aetna Health Plans

Walter J. Cherniak, 203/636-5751

or

Coventry Corporation

Richard H. Jones, 615/391-2440